Sitting of 13 February 1913

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

MOTOR TRAFFIC.
Report from the Select Committee brought up, and read [Inquiry not completed];
Report to lie upon the Table, and to be printed. [No. 519.]
Minutes of Proceedings to be printed. [No. 519.]

STREET ACCIDENTS CAUSED BY VEHICLES.
Return presented relative thereto [Address 12th February; Mr. Ellis Griffith]; to lie upon the Table, and to be printed.

SHOPS ACT, 1912.
Copy presented of Order made by the Council of the county borough of West Ham, and confirmed by the Secretary of State for the Home Department, extending the provisions of Section 4 of the Act to certain classes of Shops within the county borough, and fixing the day on which the Shops are to be closed for the weekly half-holiday [by Act]; to lie upon the Table.
Copy presented of Order made by the Council of the county borough of West Ham, and confirmed by the Secretary of State for the Home Department, extending the provisions of Section 4 of the Act to certain classes of Shops within the county borough and fixing the early closing day and the closing hours on the other days of the week for the same Shops [by Act]; to lie upon the Table.
Copy presented of Order made by the Secretary for Scotland, dated 8th February, 1913, revoking the closing order for the burgh of Paisley under the Shop Hours Act, 1904, confirmed by the Secretary for Scotland on the 3rd January, 1906, so far as it relates to Fleshers' Shops [by Act]; to lie upon the Table.

AGRICULTURAL CREDIT AND CO- OPERATION IN GERMANY.
Copy presented of Report to the Board of Agriculture and Fisheries of an Inquiry into Agricultural Credit and Agricultural Co-operation in Germany; with some Notes on German Live Stock Insurance by J. R. Cahill [by Command]; to lie upon the Table.
LOCAL TAXATION (IRELAND) RETURNS.
Copy presented of Returns of Local Taxation in Ireland for the year 1911–12 [by Command]; to lie upon the Table.
RAILWAY, ETC., BILLS.
Copy presented of Report by the Board of Trade upon all the Bills and Provisional Orders of Session 1913 relating to Railways, Canals, Tramways, Railless Electric Traction, Harbours, and Tidal Waters, and the supply of Electricity, Gas, and Water [by Command]; to lie upon the Table.
SEAMEN AND FISHERMEN.
Copy presented of Return of the Deaths of Seamen and Fishermen reported to the Board of Trade in the year ended 30th June, 1912 [by Command]; to lie upon the Table.
PAUPERISM (ENGLAND AND WALES) (MONTHLY STATEMENTS).
Return presented relative thereto [ordered 6th February; Mr. Herbert Lewis]; to lie upon the Table, and to be printed.
COLONIAL REPORTS (ANNUAL).
Copy presented of Report, No. 750 (Straits Settlements, Annual Report for 1911) [by Command]; to lie upon the Table.

NATIONAL HEALTH INSURANCE COMMISSION (ENGLAND).
Copy presented of Order dated 12th February, 1913, made under Section 78 of the Act by the Insurance Commissioners, entitled the National Health Insurance

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(Transfer of Deposit Contributors) Order, 1913 [by Command]; to lie upon the Table.
Copy presented of Provisional Regulations, dated 12th February, 1913, made by the Insurance Commissioners, entitled the National Health Insurance (Claims for Exemption) Regulations (England), 1913 [by Act]; to lie upon the Table, and to be printed. [No. 520.]

PUBLIC BILLS (ALLOCATION OF TIME).
Paper laid upon the Table by the Clerk of the House. Return relative thereto [ordered 3rd December, 1912; Mr. Wright]; to be printed.
ORAL ANSWERS TO QUESTIONS.

  Russia.
  Lord ROBERT CECILasked the Secretary of State for Foreign Affairs whether he could see his way to take any steps, whether by reference to international arbitration or otherwise, for the removal of the restrictions of residence and travel in Russia imposed on Jewish subjects of His Majesty; and whether, if the obstacle to his doing so arises from the Anglo-Russian Treaty of Commerce, 1859, he will obtain the opinion of the Law Officers as to the true construction of the treaty?
  The SECRETARY of STATE for FOREIGN AFFAIRS (Sir E. Grey): I can only refer the hon. Member to the numerous answers I have lately given to questions in Parliament on this subject, the last of which was to the hon. Member for South Manchester on the 7th of last month. The question of the interpretation of the Anglo-Russian Treaty of Commerce of 1859 has been most fully considered more than once since then by the Law Officers of the Crown.

  Angolan Labourers.
  Mr. EDMUND HARVEYasked what is the total number of Angolan labourers, exclusive of Cabendas, which have been repatriated to the mainland of Africa since the commencement of repatriation in 1909?
  Sir E. GREY: As far as the figures are available the number of servicaes repatriated to Angola appears to be about
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  2,300, of which number about 1,700 were repatriated last year.
  Mr. HARVEY: Will the right hon. Gentleman give any particulars that are possible in the forthcoming White Paper?
  Sir E. GREY: I will inquire whether everything is included.

  Fernando Po (Slave Trading).
  Mr. FERENSasked whether His Majesty's Government has received allegations of slave trading practices for the supply of labour for Fernando Po; whether the attention of the Spanish Government has been officially called to these allegations; and whether the commander of a British warship has been informed of this traffic and urged to keep a look out for any vessels engaged in slave trading?
  Sir E. GREY: We have received information that there have been irregularities affecting British subjects in the recruitment of labourers for Fernando Po under the pretence that they were to be sent elsewhere, and also in their contracts and in regard to their departure from the island. The circumstances have been brought to the notice of the Spanish Government who are considering them. The commander of H.M.S. "Dwarf" has furnished information on the subject and will continue to watch for any further irregularities.

  Persia.
  Mr. MORRELLasked whether there is now any prospect of the carrying out of the proposals for an adequate loan to the Persian Government to enable them to restore order in that country?
  Sir E. GREY: Good progress is being made with the arrangements for an advance to the Persian Government for immediate requirements, and there is every reason to hope that they will shortly be concluded. The question of obtaining a substantial loan to Persia from financiers will then be considered.
  Sir JOHN LONSDALE: Is the right hon. Gentleman aware that in existing conditions British trade is completely paralysed owing to the impossibility of protecting caravans?
  Mr. SPEAKER: The hon. Member must give notice of that question.
  Colonel YATEasked the Secretary of State for Foreign Affairs whether, though the actual length of mileage may not be the best comparison available, still, failing something better, he will meanwhile see to it that the concession granted by the Persian Government to the British syndicate shall not be less in length of mileage than that granted to the Russian syndicate, and that the British syndicate be given a preferential right to further extension similar in extent to the number of miles by which the concession to the Russian syndicate in the North for the three lines of railway from Julfa to Tabriz, from Tabriz to Urumia, and from Tabriz to Kazvin exceeds in total length the concession granted to the British syndicate for the line from Mohammerah to Khorramabad in the South?
  Sir E. GREY: So far as the mileage of the two railways can be compared in the absence of a survey—a calculation which is admittedly a mere speculation having regard to the mountainous character of the country between Mohammerah and Khorramabad I should be inclined to estimate that the line from Mohammerah, or a point adjacent thereto, to Khorramabad will only be a little shorter than the Russian projects if the preferential extensions are included; if they are not included, the Mohammerah railway will be considerably the longer of the two. I am not satisfied that comparison of mileage is any indication of the value or commercial advantages of the respective projects.
  Sir J. D. REES: Does not the Russian concession include an option of extension of 250 miles, and does not that make it a far more valuable concession?
  Sir E. GREY: No; I do not think it does. First of all, it is only a possibility of extension, and even when that is included the total mileage will only be a little more than the mileage from Mohammerah to Khorramabad.
  Colonel YATE: Can the right hon. Gentleman say how many more miles?
  Sir E. GREY: It is impossible to give more than a rough estimate until the survey is made, because it cannot be possible to go direct.
  Colonel YATEasked the Secretary of State for Foreign Affairs whether the two years' option granted by the Persian Government to the British syndicate for the construction of a railway line from
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  Mohammerah to Khorramabad is a concession similar in every respect to that granted to the Russian syndicate, or whether it may be transformed into a mere contract; and, if so, why has this distinction been drawn; and will he take steps to insure absolute equality of treatment between the Russian and British syndicates?
  Sir E. GREY: The hon. and gallant Member may rest fully assured that His Majesty's Government will afford the British syndicate all necessary support to secure their interests. As, however, I am not yet in possession of sufficiently precise information in regard to the Russian project, I am not in a position to draw comparisons between the conditions of the British and Russian projects. The option granted to the British syndicate is to build a line as a State railway for the Persian Government, or to build one under the terms of a concession; the choice of these alternatives is not to be made until the survey is completed, but it is the intention to settle details as to management, etc., before the survey is started, and the conditions attaching respectively to a concession or a contract will, I anticipate, differ in form rather than in substance.
  Colonel YATE: Have similar conditions been applied to the Russian as to the British syndicate?
  Sir E. GREY: I am not possessed of sufficiently precise information in regard to the Russian project to be able to give details of the concession.
  Colonel YATE: Will the right hon. Gentleman see that the British syndicate does not suffer in any way in comparison with the Russian?
  Sir E. GREY: Certainly. I do not think that the British syndicate with their option for two years run any risk of being placed at a disadvantage compared with the Russian.

  War in Balkans.
  Mr. WALTER GUINNESSasked the Secretary of State for Foreign Affairs (1) whether he has any official information showing that after the occupation of Prisrend the Servian troops set houses on fire and shot men, women, and children as they ran out, and that the massacre is estimated by various refugees to have amounted to between 500 and 900;

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  (2) whether he has any official information showing that when the Servian troops occupied Lyuma they tied women and children together, saturated them with petroleum and set them on fire besides stripping many men and stabbing them to death with bayonets, and that the total number who thus perished is estimated as between 500 and 600; (3) whether he has received any report from the Consul-General at Salonica as to the statement that the Greeks tied together seventy-five Turkish prisoners of war and drowned them in the River Vardar; (4) whether he has any official information showing that the Greeks massacred many Albanians at Prishtina and executed many of the most prominent Albanians and Kutzo Vlach inhabitants of Karaferia after so-called trial by court-martial; (5) whether his attention has been drawn to the report of the Comité de Publication des Atrocités des Coalisés Balkaniques, which gives particulars of a massacre at Serres in which, at the lowest estimate, 1,700 Turks perished; and whether he has received any conformation of it; and (6) whether his attention has been drawn to the Report of the Comité de Publication des Atrocités des Coalisés Balkaniques, which states that, during the first forty-eight hours of the occupation of Strumitza by the Bulgarian troops, thirty-four Moslems were massacred, including two old men and five children; that after the departure of Colonel Mitoff, the Bulgarian Lieutenant Volcheff, the Servian Commandant, Ivan Gribitz, the Comitadji Chief Tshacof, and four others, were constituted as a tribunal, and condemned and executed 591 persons during twenty-three days, in most cases by bayonet stabs or after some horrible mutilation; whether he has any Consular Reports confirming these statements; and whether he has any information as to the punishment of those responsible for such atrocities?
  Sir E. GREY: As regards the first four questions concerning events alleged to have occurred at Prisrend, Lyuma, on the Vardar, and at Prishtina and Karaferia, I have received no information from any official source bearing out the statements made. As regards the last two, relating to outrages alleged to have been perpetrated at Serres and Strumnitza, the report of the committee referred to has not come under my notice. I have, however, received Consular Reports containing statements substantially the same, though
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  naturally not based on personal knowledge. The hon. Gentleman is already aware, from replies returned to him on the 16th, 21st, and 28th, of the action which I took on these reports. I shall take similar steps in the case of any further reports of the same kind which may reach me, when there seems to be foundation for them, but in this connection I would recall attention to the remarks I made in replying to the hon. Gentleman on the 28th ultimo.
  Mr. W. GUINNESS: In the case of those first four questions as to which the right hon. Gentleman has got no official report, has his attention been called to the statements of the Roman Catholic Bishop of Prishtina at Vienna and other refugees, and can he inquire into the matter?
  Sir E. GREY: It is impossible for us, while the war is going on, to undertake in the districts which are at present the theatre of warlike operations, over which we have no control, the duty of investigating charges made from any quarter.
  Mr. W. GUINNESS: Can the right hon. Gentleman not reassure our Moslem fellow-subjects by at least expressing the horror that he feels at these well authenticated cases which have reached him, and expressing some friendly hope that the allied Governments would take steps to prevent a repetition of them?
  Sir E. GREY: Of course statements of that kind, from whatever quarter they came, must be most painful and distressing reading. So far as I am concerned I must repeat that the hon. Member never seems to attach the weight which ought to be attached to the action which we have taken. Whenever reports have reached me from the Consul, even though not based on personal knowledge or first-hand information, and for which there appears to be foundation, I have brought it to the notice of the Governments concerned, either the Bulgarian, Servian, or Greek Governments, whichever it might be, and I have expressed the expectation that they would take steps to put a stop to anything of this kind, or to prevent it from happening. The replies that have been received both from the Bulgarian and Servian Governments state that any outrages of this kind will be punished, and that the outrages which did occur, so far as their information went, had been committed by irregular bands and not by troops.
  Mr. WHITEHOUSE: Is it within the knowledge of the right hon. Gentleman that the Bulgarian and Servian Governments, through the troops, are disarming the whole of the population in the occupied territory as rapidly as possible, and that they are doing their best to restore order in the country?
  Mr. W. GUINNESS: May I also ask whether it is not stated on good authority that, after disarming the population, they proceed to massacre them? [HON. MEMBERS: "No," "Hear, hear."]

  Crown Jewels (Dublin).
  Captain FABERasked the Chief Secretary whether anything has transpired to throw light on the subject of the theft of the Dublin Crown jewels; and whether, either now or at any time since the robbery, information relating to the crime has been available which, for the sake of shielding any individual, has not been used?
  Mr. GINNELL: On a point of Order, Sir. I desire to ask your ruling on the second part of this question. It asks, in effect, whether the Chief Secretary is or is not guilty of the crime of conferring immunity from the criminal law upon some person. In the first place, the Chief Secretary has been directly charged and has not explicitly denied the charge. In the second place, the accused person—
  Mr. SPEAKER: The hon. Member, I understand, is putting a question.
  Mr. GINNELL: Yes, certainly.
  Mr. SPEAKER: The question seems to me of very much the same character as that already asked by the hon. Member.
  Mr. GINNELL: On a point of Order. May I ask, Sir, whether it is in order to ask a Member in the position of the Chief Secretary a question the answer to which may incriminate him?
  Mr. SPEAKER: If it will have that result, he is not bound to answer.
  The CHIEF SECRETARY for IRELAND (Mr. Birrell): Nothing whatever has been discovered to throw any new light on the mystery of the theft of the Crown Jewels; nor is there any evidence whatever in existence at the present moment which would justify the arrest or prosecution of any person. The story, which someone must have invented out of
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  spite, that anyone is being shielded from prosecution is simply a lie; and I am sorry to have to add that it has lately been revived in connection with the name of Lord Haddo. The introduction of his lordship's name into the matter is a particularly cruel outrage, for, as already stated, he was not in Ireland for months before or after the robbery; he had no connection with the Office of Arms, and was only inside that office once in his life.
  Mr. GINNELL: May I ask on what grounds, except Kane's report, did the Chief Secretary ask Lord Haddo to say that he was absent from Dublin at the time?
  Mr. BIRRELL: I inquired about the movements of Lord Haddo, because I regret that in some infamous newspapers in this country his name was connected with the crime.
  Mr. GINNELL: Will the right hon. Gentleman say why Lord Haddo was not produced before the Commission?
  Earl WINTERTONasked who were the persons holding official positions entitling them to have access, or acting as clerks or secretaries to those entitled to have access, to the Dublin Crown Jewels at the time immediately preceding their theft; and how many of those persons have subsequently resigned their offices, with the reasons given in each ease?
  Mr. BIRRELL: The only person entitled to have access to the Crown Jewels was Sir Arthur Vicars, Ulster King-of-Arms. The persons employed in the Office of Arms immediately preceding the theft of the jewels were Mr. Burtchaell, secretary to Sir Arthur Vicars, Mr. Horlock, clerk, and Miss Gibbon, typist. These persons were in the personal employment of Sir Arthur Vicars, and their employment ceased on his removal from office. Mr. Burtchaell was subsequently placed in charge of the office and has since been appointed Athlone Pursuivant. The officials attached to the office at the time were Mr. Mahony, Cork Herald, Mr. Shackleton, Dublin Herald, and Mr. Goldney, Athlone Pursuivant. In October, 1907, it was decided, with the approval of the Crown, that the Office of Arms, Dublin Castle, should be reconstructed. This involved the retirement of the Dublin Herald, and the Athlone Pursuivant, who were notified accordingly and resigned office. Mr. Mahony, the Cork Herald, resigned in 1910, assigning no reason for doing so.
  Earl WINTERTON: Will the right hon. Gentleman say on what date Mr. Shackleton resigned his post?
  Mr. BIRRELL: I am afraid I do not remember the exact date.
  Mr. GINNELL: Will the Chief Secretary inform the House about the missing duplicate key of the strong room? Has it yet been discovered?
  Mr. BIRRELL: I do not know what the hon. Member means. There were two or three keys opening this particular safe, all of which were in the possession of Sir Arthur Vicars.
  Mr. GINNELL: Are they available now?
  Mr. BIRRELL: I think so; yes.
  Mr. GINNELL: No.
  Mr. GINNELLasked what persons, other than officials and their assistants, had access, through relationship and acquaintance with officials and familiarity with the police, to the room in Dublin Castle in which the Crown Jewels were kept at the time those jewels were stolen in 1907?
  Mr. BIRRELL: I know of no such persons.
  Mr. GINNELL: Can the right hon. Gentleman inform the House why, during the last five years, he has not been able to get anybody in Ireland to believe his version of the story?

  Cattle Driving (County Kildare).
  Captain CRAIGasked whether the Chief Secretary has received information of a cattle drive which took place last week on the property of Mr. W. B. Murphy, Lallymore, in county Kildare; whether the adjoining tenants have demanded that this property should be sold and distributed amongst them; whether this cattle drive has been carried out with a view to compelling the landlord to sell his property; whether any arrests have been made or anyone made amenable; and whether, in view of this intimidation, the Congested Districts Board or Estates Commissioners will intervene to compel the landlord to sell?
  Mr. BIRRELL: The police authorities inform me that thirty head of cattle and forty-four sheep were driven off the lands of Mr. Murphy on the night of the 20th January. No person so far has been made amenable, but the police are taking
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  special precautions in order to prevent a repetition of the offence. A memorial from the tenants on the estate asking the Estates Commissioners to acquire the untenanted land was received by them in 1910, and an inspector has recently visited the property, and his report is awaiting consideration by the Commissioners. At present they cannot make any statement as to what action they may take in the matter.

  County Donegal (Lord Lieutenant).
  Captain CRAIGasked how many names have been submitted for the position of His Majesty's Lieutenant for county Donegal, vacant by the death of the late Duke of Abercorn; if the Chief Secretary is aware that Mr. J. B. Mullin, who is a candidate for the office, is a tradesman in Londonderry city; and if he intends to recommend him for the appointment?
  Mr. BIRRELL: The high office referred to in the question is not one which is filled up from a list of candidates, and any applications for it are irregular and improper. No name has as yet been selected by the Lord Lieutenant for submission to His Majesty. The gentleman referred to in the question has written to me to say that he is no more a tradesman than the hon. and gallant Member, but as to this I know nothing. The appointment does not rest with me.
  Sir J. LONSDALE: Is the right hon. Gentleman aware that if this candidate or this gentleman is appointed to the position, it will be regarded in the North of Ireland as a reward for political services in connection with a recent by-election?
  Mr. BIRRELL: I object altogether to anybody's name being mentioned in connection with an office of this sort. There are no candidates, and anybody who is a candidate will not get it.

  Road Surveyors and Deputies (County Kerry).
  Mr. NEWMANasked the number and salaries of road surveyors and deputies in the county of Kerry at the present time as compared with the number employed under the grand jury system prior to 1898; whether the Chief Secretary is aware that in August of last year the Kerry County Council passed over the names of two duly qualified candidates for the post of deputy and gave the appointment to the son of an existing deputy surveyor though without the neces-

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  sary qualification; whether the Local Government Board refused to sanction the appointment; and whether, in view of the importance of tourist traffic to county Kerry, the Local Government Board will insist on the appointment of officials holding the necessary qualifications irrespective of their creed or nationality?
  Mr. BIRRELL: There are now in county Kerry one county surveyor, with a salary of £1,000 a year; one assistant surveyor and clerk, with £160 a year; and five assistant surveyors at £150 a year. In April, 1898, there were one county surveyor at £730, three assistant surveyors at £80 a year each, and three others, with salaries of £70, £50, and £40 a year, respectively. The Local Government Board have no information as to the number of qualified candidates for the vacant position of assistant surveyor last year. The county council appointed the son of one of the existing assistant surveyors, who had for some time previously been assisting his father in his work; but, as he had not the necessary qualifications, the Board requested the council to proceed to a new appointment. The council asked that the selected candidate should be allowed an opportunity of qualifying as assistant surveyor at the next examination, and the Board, having made inquiries as to his experience and qualifications, consented. Pending the result of the examination, the Board do not propose to take any further action in the matter.
  Mr. NEWMAN: Is it not the fact that this appointment was vacant as long ago as last summer, and that it has been kept open all that time?
  Mr. BIRRELL: I went into the case, and the gentleman really had very considerable external qualifications. There is no doubt that in many respects he was a very competent person, but he had not the technical qualification which the Board thought necessary for the post, and it stands over for him to be tested by examination.
  Mr. NEWMAN: How long has the position to be kept open for this gentleman to learn his work?
  Mr. BIRRELL: The examination will be held very soon indeed.

  Evicted Tenants (Reinstatement, Ireland).
  Mr. LYNCHasked whether the Estates Commissioners will this year re-
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  instate any evicted tenants in West Clare; if so, how many, and within what limit of time; and whether, if the delay be caused by reason of land not being available, the Congested Districts Board will use the powers at their disposal to obtain the land necessary?
  Mr. BIRRELL: The Estates Commissioners are not in a position at present to state the number of holdings they can provide during the current year for evicted tenants on such untenanted land in county Clare as they may be able to acquire in the year. It is not at present possible to state how much land can be so acquired in that county or to estimate how much of it, if acquired, will have to be utilised by them in the enlargement of small holdings in the neighbourhood.
  Mr. LYNCH: Is the right hon. Gentleman aware that with proper business management all these questions could be disposed of in a week, instead of which they have been kept alive in a most vicious way for years?
  Mr. BIRRELL: I am sure a week would not be enough.

  Kilrush (County Clare) Water Supply.
  Mr. LYNCHasked the Chief Secretary for Ireland how many towns of the size of Kilrush, West Clare, in Ireland, have a gravitation water supply; whether he can give the average cost of such schemes and the proportion by which the rates were burdened in consequence; whether the general health of these towns is better than that of Kilrush; and whether, in view of the cost of a water scheme in Kilrush and of the fact that the money is required for housing schemes, the Local Government Board will give attention to the representations of all the local bodies interested, including the urban council, and forbear from pressing this water scheme?
  Mr. BIRRELL: The information asked for in the first part of the question is not available. With regard to the last paragraph, I would refer the hon. Member to the replies given to his previous questions on this subject.
  Mr. LYNCH: May I ask the right hon. Gentleman to give more weight to the representations of these local bodies who know the facts, and as well also of their Parliamentary representative?
  Mr. BIRRELL: I have already done so, and I will again consider it.

  River Shannon Floods.
  Sir WALTER NUGENTasked the Chief Secretary if he has received resolutions from the local public boards in Athlone and county Westmeath dealing with the distress created by the Shannon floods; and whether, in view of the fact that this state of things is periodically recurring, he will appoint a small Commission to report on the whole matter and suggest what steps should be taken to deal with the same?
  Mr. BIRRELL: I have received several resolutions on the subject. The question was fully dealt with by the Royal Commission on Irish public works in 1887 and no useful purpose would be served by the appointment of a small commission. The difficulty is mainly one of finance, but the rival claims of drainage and nagivation have also to be considered.

  Land Purchase (Ireland).
  Mr. DUFFYasked the Chief Secretary if the question of making an offer to Viscount Gough for the purchase of the holdings situate in the town of Gort has been considered; and, having regard to the fact that proceedings are at present going on for the settlement of the agricultural portion, will he represent to the Estates Commissioners the wisdom of keeping in their hands the entire estate until such time as steps have been taken to include the town holdings in the sale?
  Mr. BIRRELL: I have nothing to add to my reply to the question of the hon. Member on this subject on 10th instant.
  Mr. DUFFY: Can the right hon. Gentleman inform us is it the intention of the Estates Commissioners to deal with the agricultural portion of the estate, and, having dealt with it, then take up the town?
  Mr. BIRRELL: I believe the Commissioners are making an offer for the purchase of the holdings in the town at the earliest possible moment.
  Mr. DORISasked when the Congested Districts Board intend to proceed for the compulsory acquisition of the congested estates in West Mayo, which landlords have refused to sell voluntarily?
  Mr. BIRRELL: The Board do not at present anticipate the necessity of having to put in force their compulsory powers in the case of any estates in West Mayo. In some cases in which it was thought
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  that compulsion would be necessary there is now reason to believe that voluntary sales may be carried out.
  Mr. DUFFYasked the Chief Secretary whether he is aware of all the circumstances connected with the sale to Mr. John A. O'Flaherty of the farm land situate at Oranmore, townland of Frenchfort, on the estate of Miss Dora Creagh; is he aware that Mr. O'Flaherty, at the time of signing the agreement to purchase, was a grazing tenant, letting the land to small tenants at a large profit; is he aware that Mr. O'Flaherty is an absentee in New Zealand, a gentleman occupying an important public position under the Government in that country; does he know that four other tenants, small and uneconomic, have holdings on this estate and have applied for an enlargement of the same; and, seeing that it was never intended, under the Acts of 1903 and 1909, that money should be advanced by the State to enable men like Mr. O'Flaherty to acquire such lands, will he cause the Estates Commissioners to make special investigation into the circumstances of this case before they take on themselves the responsibility of vesting this farm in Mr. O'Flaherty?
  Mr. BIRRELL: I would refer the hon. Member to the reply given to his question on this subject on the 16th January to which I have nothing to add.
  Mr. DUFFY: Is the right hon. Gentleman aware that this is a case of a permanent resident in a foreign country in a public position, and in view of the fact that there are a large number of uneconomic holdings in the neighbourhood, will he consider the matter before assigning the holding over to this absentee?
  Mr. BIRRELL: That was the exact question put by the hon. Member to me before, but I will recall the attention of the Estates Commissioners to the matter.
  Mr. LARDNERasked whether it is proposed to have the Return under the Irish Land Purchase Acts (Command Paper 6130) brought up to date; and, if so, when the continuation Paper will be issued?
  Mr. BIRRELL: I propose to have the Return brought up to the end of the last financial year and issued as early as possible next Session.
  Mr. LYNCHasked the Vice-President of the Department of Agriculture

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  (Ireland), how many lettings on the eleven months' system have been granted by the Board in the Vandeleur demesne, West Clare; whether he is aware that the failure to carry out the provisions of the Act in regard to this property has caused in Kilrush discontent which has found expression in resolutions of all public bodies in that town; and whether the Board will make over the demesne to the Estates Commissioners?
  Mr. BIRRELL: Grazing over such lands at Kilrush Forestry Centre as were not included in the plan of planting operations for the season 1912–13 was let in eight lots by public auction in March, 1912. These lettings will expire in February, 1913. Another lot was let from March to November, 1912. With regard to the last part of the question, I would refer the hon. Member to the reply given to his question on this subject on 16th ultimo.
  Mr. LYNCH: Can the right hon. Gentleman say under what Section of the last Land Act this action has been taken?
  Mr. BIRRELL: I should like notice of that.

  Old Age Pensions.
  Mr. O'DOWDasked the Chief Secretary the grounds on which the Local Government Board based their decision given on 31st January ultimo, in the appeal case of Patrick Lally, No. C.A. 2653, Tubbercurry, county Sligo, sub-committee, by which they refused the applicant an old age pension granted him by the local pension committee; whether he is aware that Lally's age has been testified to by the sworn affidavit of Mr. Charles Brett, of Achonry, a respectable Protestant gentleman; whether he is aware that the entries in Mr. Brett's family Bible were examined by Rev. Canon Daly, P.P. and Mr. P. J. Henry, J.P., members of the committee, and that these entries show Mr. Brett himself to be seventy-eight years; and, if so, whether, seeing that Mr. Brett positively swears he remembers Lally's birth in 1842, he will order a fresh investigation of the case?
  Mr. BIRRELL: Patrick Lally's claim for a pension was disallowed by the Local Government Board on appeal on the grounds that the evidence produced before them was not sufficient to warrant them in holding that Lally had established his claim to be at least seventy years old. I have no power to order a fresh investiga-
  1168
  tion of this case, which cannot be reconsidered by the Board unless it comes before them again on appeal.

  Labourers Acts (Ireland).
  Mr. LARDNERasked the Chief Secretary for Ireland whether he is aware that, on 23rd December, 1906, John Marron lodged with the clerk of the Cootehill (No. 2) Rural District Council a representation in Form 1, under the Labourers Act, applying to have a cottage erected on the farm of James Carey, in the townland of Aughnamullen, Anny electoral district, county Monaghan; that this representation was duly considered and accepted on behalf of Marron at a meeting of the rural district council, held on 15th February, 1907; that at the Local Government inquiry under the Labourers Act, held in December, 1907, Marron appeared and gave evidence in support of his representation before the inspector, who approved of Marron as a suitable person for a labourer's cottage and passed his claim and the site for the cottage; that the cottage was not completed till the year 1912, and the letting thereof was considered at a meeting of the rural district council held on 2nd August, 1912, when Marron attended with the intention of getting possession from the council, but instead the council decided to give the cottage to a man named Joseph Kennedy; whether he will state while Joseph Marron, who is a bonâ-fide labourer with a wife and family, who first applied for the cottage and waited five years for it, was passed over for Kennedy, who was not resident in the district and is not a labourer insured as an employed person, but a speculator yearly in conacre lettings and grazing takes, and who never applied for the cottage; will he state whether the council acted within their rights in passing over Marron for Kennedy; whether the Local Government Board have any power to deal with the case; and, if so, what action they have taken or intend to take?
  Mr. BIRRELL: The facts of the case are even more complicated than would appear from the question, as there was a third applicant who considered that he had some claim to the cottage. The Local Government Board, after carefully considering Marron's complaints, have come to the conclusion that the case is not one calling for their interference. The question whether the council were acting within their legal rights is one which could only be determined by a Court of Law.

  Newry Licensing Prosecution.
  Mr. MOONEYasked the Chief secretary whether he is aware that during the last six months six summonses have been issued by the Royal Irish Constabulary against Mrs. Margaret Byrne, licensed vintner, of Margaret Street, Newry, for alleged breaches of the licensing laws; whether he is aware that in each case the police prosecution failed and the cases were dismissed; whether Mrs. Byrne has been put to considerable expense in defending these cases; and whether he will take steps to see that this licence holder is not subjected to a repetition of such charges?
  Mr. BIRRELL: The police authorities inform me that Mrs. Byrne has been summoned on five occasions during the past nine months for breaches of the licensing laws. While in each of these cases the charge against Mrs. Byrne was dismissed, the parties found drinking on the premises on three of the occasions were convicted and fined. I have no reason to believe that the police are doing any more than their duty in regard to the supervision of this public-house.
  Mr. MOONEY: Is the right hon. Gentleman aware that with the last case the chairman of the bench said there was not a particle of evidence to justify the charge—the action of the police?
  Mr. BIRRELL: I will call the attention of the police to this matter, but I am not at all disposed to induce them to relax their vigilance.

  Irish Land Commission (Secretaryship).
  Mr. GINNELLasked on whose nomination, at what date, and at what salary, Mr. C. T. Beard became secretary to the Irish Land Commission; what positions he held prior to that time; where, if at all, he acquired the special knowledge of Irish Land Laws which that position requires; what qualifications and previous experience were alleged to make his claim superior to that of officials of many years' service in that Department; whether the work for which he is paid is now done by those officials and could not be done by him without them; and whether he is one of the salaried officials who must be maintained and pensioned out of Irish revenue under the Government of Ireland Bill?
  Mr. BIRRELL: Mr. Beard was appointed secretary to the Irish Land Commission
  1170
  from the 1st October, 1910, at a salary of £1,200 per annum. The appointment was made by the Land Commission with the consent of the Lord Lieutenant under the authority of Section 45 of the Land Act of 1881. Mr. Beard had been for upwards of thirty-two years in the permanent Civil Service of the Crown, and at the date of his appointment he was a first-class clerk on the staff of the Chief Secretary's Office, Dublin Castle. During the six years immediately preceding his appointment to the Land Commission he was successively clerk in charge of the Irish Office, London, and private secretary to the Chief Secretary. In appointing Mr. Beard as their secretary the Land Commissioners selected the gentleman, who, in their opinion, was by reason of his qualification and experience best fitted for the post, and he has since proved his competency to their entire satisfaction. Mr. Beard's duties are mainly connected with land purchase, and as that is a "reserved service," under the Government of Ireland Bill, the provisions of that Bill with respect to the salaries and pensions of existing Irish officers will not apply to his office.

  Local Government Board, Ireland (Appointment of Inspectors).
  Mr. GINNELLasked whether temporary inspectors under the Local Government Board for Ireland usually become permanent in name or in fact; what qualifications, examinations, or knowledge of the matters to be inspected are required; whether local government officials of experience are eligible; whether it was in open competition, and, if not, on whose nomination, with what examination, and with what salary and average annual expenses Mr. Alfred Tennyson obtained that position; where and when he had acquired the qualifying knowledge and experience in local government; what had been his salary before this appointment; and whether he is one of the salaried officials intended to be maintained and pensioned out of Irish revenue under the Government of Ireland Bill?
  Mr. BIRRELL: Persons temporarily employed as inspectors under the Local Government Board occasionally obtain permanent appointments if they prove themselves fully competent. No examinations are prescribed for temporary inspectors, and local government officials are eligible for such appointments. Mr. Tennyson, who had previously passed a first-class Civil Service examination, was employed temporarily in connection with the Old

  1171
  Age Pensions Act by the Vice-President of the Local Government Board at a time when there was great pressure in the Department charged with the administration of that Act, and is still attached to that Department. His salary is £350 a year with the usual travelling allowances. He is not pensionable, and is in the same position as regards the Irish Government as other temporary officers who can be removed at any time.
  Mr. GINNELL: Will the right hon. Gentleman say is this the same person whom the Chief Secretary as President of the Board of Education appointed Junior Examiner to that Board, and who before his probationary period had expired, resigned in order to avoid dismissal.
  Mr. BIRRELL: No, Sir. Really I think that is not a fair way of dealing with a young man, even though he may happen to have the misfortune of being a relative of mine. He started his official life by passing with great distinction an examination for a clerkship in the House of Lords. Finding that office not sufficient for his energies, he desired to be transferred to the Board of Education, which he could only be on terms of probation. He was there for a short time, when I am sorry to say, his health broke down. He went away and resided for a year farming in British Columbia. He returned perfectly restored in health, and without any operation or movement on my part the Vice-President of the Irish Local Government Board gave him this purely temporary appointment, from which he could be dismissed on a week's notice, in the Old Age Pensions Department. He has there conducted himself exceedingly well, and has won very good reports. I only wish the hon. Member discharged his duties equally well.

  Nigeria (Mineral Rights).
  Mr. TOUCHEasked the Secretary of State for the Colonies whether the mineral rights in Nigeria are reserved to the Government or in whom they are vested?
  The SECRETARY of STATE for the COLONIES (Mr. Harcourt): In Northern Nigeria, and in part of Southern Nigeria, the Government succeeded to all the mining rights which had been acquired by the Niger Company. In the rest of Southern Nigeria the Government has assumed the right, by legislation, to direct
  1172
  under what conditions and by whom it may be carried on, the surface rights of the occupants of the land being duly protected.
  Mr. J. WARD: Can the right hon. Gentleman persuade the Administration to make similar provisions with regard to mining rights at home?
  Mr. HARCOURT: I have to do only with mining rights outside this country.

  Government Offices (Edinburgh).
  Mr. JAMES HOGGEasked the hon. Member for St. George's-in-the-East, as representing the First Commissioner of Works, whether the competition for the designs for the proposed new Government offices in Edinburgh will be unrestricted; and, if not, what restrictions are proposed?
  Mr. WEDGWOOD BENN (Lord of the Treasury): The conditions of the competition have not yet been settled, but the present intention is that it shall be an open one.
  Mr. J. HOGGE: Before the terms are settled, can we have an opportunity of knowing what they are?
  Mr. W. BENN: Perhaps the hon. Gentleman will put a question on the Paper a little later on, when we have had an opportunity of consulting Sir Robert Lorimer further.
  MARQUESS of TULLIBARDINE: Is not this really a question for the Committee who have been entrusted with the matter?
  Mr. W. BENN: I do not think it is necessarily a matter for the Committee to decide; but the Commissioners will be glad to have the benefit of the opinion of Members of the Committee?
  MARQUESS of TULLIBARDINE: Would it not be better for the Committee to resign?
  Mr. JAMES HOGGEasked whether it is proposed to adhere to the present site for the proposed new Government buildings in Edinburgh?
  Mr. W. BENN: The answer is in the affirmative.

  Leamington Post Office (Pay of Workmen).
  Mr. TYSON WILSONasked the hon. Member for St. George's-in-the-East,

  1173
  as representing the First Commissioner of Works, if he is aware that Messrs. Colbourne, contractors, of Swindon, who have the contract for the erection of a new post office at Leamington, are not paying their workmen on that job the proper rate of pay when they are working overtime; and whether he will compel this firm to pay all arrears of overtime pay, or remove them from the list of contractors who are invited to tender for work for his Department?
  Mr. W. BENN: The First Commissioner is aware of the facts and has called on the contractor to refund to the workmen the arrears of overtime wages.

  Westminster Hall (Scaffolding).
  Mr. KINGasked whether the scaffolding about to be erected in Westminster Hall will have to remain erected for several months; and how much of the hall's floor-space will be occupied by it?
  Mr. W. BENN: The First Commissioner regrets that this restoration and inspection are necessary. Operations have been delayed owing to the continuous sittings of Parliament, but can now be deferred no longer. The scaffolding will be required in the positions where erected for some months. About one-half of the floor area immediately beneath the scaffolding for four bays of the roof will be taken up, but Adequate passage will be provided.
  Mr. SWIFT MacNEILL: In order to provide the passages would the hon. Gentleman remove even temporarily the hideous images there?

  Calton Gaol, Edinburgh.
  Mr. FREDERICK WHYTEasked whether the Office of Works has made any estimate of the cost of removing the Calton Gaol from its present site; whether any search for a new site has been or will be made; and whether the question of an alternative site for the proposed new Government buildings, other than the Calton site, has been considered and decided?
  Mr. W. BENN: The removal of the Calton Gaol and the acquisition of a new site is not a matter to be settled by the First Commissioner of Works, and no estimate of the cost of such removal and acquisition has been prepared by him. Another site for the proposed new Government buildings was considered, but the decision was in favour of the Calton Prison site.
  Mr. J. HOGGE: Will the hon. Gentleman say where the other site was?
  Mr. W. BENN: In St. James' Square.
  MARQUESS of TULLIBARDINE: Can the hon. Gentleman give us any particular reason why the hon. Member for East Edinburgh (Mr. J Hogge) should prefer the preservation of a gaol instead of public buildings?
  Mr. J. HOGGE: May I say—
  Mr. SPEAKER: I deprecate these personal exchanges.

  Palace of Westminster (Alterations).
  Mr. KINGasked for further information concerning the projected alterations in the House; whether the new staircase will be completed before the House reassembles on the 6th March; and whether the promised accommodation for hon. Members' secretaries will be available for lady secretaries?
  Mr. W. BENN: The First Commissioner will place in the Tea Room drawings of the proposed new staircase. The alterations necessary to make available the new room in Westminster Hall will not be undertaken for some months, and the precise details are not settled. The First Commissioner will fall in with the wishes of hon. Members generally as to the use to be made of the new room.
  Mr. MACPHERSONasked whether, in view of the fact that the staircase from the Strangers' Lobby to the Terrace is quite inadequate, he will see that a new staircase is built; and, if so, whether he will place the plans for the proposed staircase in the Tea Room so that Members of the House may see them?
  Mr. W. BENN: As I stated in previous answer, a new staircase is now being constructed, and the First Commissioner will cause the drawings of it to be exhibited in the Tea Room.
  Sir C. KINLOCH-COOKE: Has the hon. Gentleman considered the advantage of a lift?
  Mr. W. BENN: That was considered, but the other scheme was thought preferable.

  House of Commons (Private Members' Opportunities).
  Mr. KINGasked the Prime Minister whether he is aware that owing to the late commencement of next Session, combined

  1175
  with the early date of Easter, the opportunity of private Members, especially for private Members' Bills, Will be reduced to an unusual extent in the coming Session; and whether, with the object of encouraging private Members to bring forward practical proposals, he will propose such alterations to the usual procedure as will extend their opportunities?
  The PRIME MINISTER (Mr. Asquith): I do not know what alterations my hon. Friend has in his mind. I am not aware of any practicable course that the Government could take to give effect to his suggestion.
  Mr. KING: Will the right hon. Gentleman assure us that if he takes away any facilities from private Members he will give them back as much as he takes away?
  The PRIME MINISTER: That is too large an undertaking.

  NATIONAL INSURANCE ACT.

    AMENDING BILL.
    Mr. GODFREY LOCKERLAMPSONasked the Prime Minister (1) whether he will give this House an adequate opportunity of discussing Amendments to the National Insurance Act at an early date, and (2) whether he will give facilities for a Bill to amend the National Insurance Act so that an insured person can recover from the Insurance Fund the expenses of emergency medical treatment which he may have incurred outside the district in which his panel doctor operates?
    The PRIME MINISTER: As I have repeatedly stated, it would be premature at present to make any further announcement with regard to the business of next Session.
    Mr. HARRY LAWSON: Will the right hon. Gentleman consider whether an opportunity might not be given in connection with the Bill for the Amendment of the National Insurance Act which he promised yesterday?
    The PRIME MINISTER: I will certainly consider that.

    REDUCED CONTRIBUTIONS.
    Major HOPEasked the Secretary to the Treasury how many employed contributors in Scotland have been permitted to pay the reduced contributions under Clause 47 of the National Insurance Act;
    1176
    and how many of these are agricultural labourers?
    The FINANCIAL SECRETARY to the TREASURY (Mr. Masterman): The special provisions of Section 47 of the Act are in operation as regards about 17,190 insured persons in Scotland. It is not possible to give the numbers of any particular class of persons included in this total.
    Major HOPE: Is the right hon. Gentleman aware that of the agricultural labourers of Midlothian only 8 per cent. have found the Section any advantage to them, although it was framed for their peculiar circumstances?
    Mr. MASTERMAN: It was framed to meet exceptional cases, and if only 8 per cent. wish those exceptional arrangements I think it was worth doing.

    SANATORIUM BENEFIT.
    Mr. DUNCAN MILLARasked the Secretary to the Treasury if he can state the hospital accommodation within the county of Lanark available for the purpose of the administration of sanatorium benefit; the arrangements made by the county insurance committee with the public health department of the county of Lanark and other local authorities having the management of existing hospitals and sanatoria for the accommodation of insured persons; and the expense in administering the sanatorium benefit within the county during the first six months since the National Insurance Act came into operation?
    Mr. MASTERMAN: I am informed that the present number of beds available for the institutional treatment of tuberculosis in the county of Lanark is 183; that the cost of providing sanatorium benefit within the county up to the 15th ultimo was £645 15s. 1d., and that arrangements have been made in conjunction with the public health authority for the immediate admission to sanatoria of all tuberculous insured persons in the county who are recommended for institutional treatment.
    Sir HENRY CRAIKasked the Secretary to the Treasury whether an insured person named Walter Green, 295, Banbury Road, Oxford, was recommended for immediate sanatorium treatment on the 10th January, when the tuberculosis officer examined him; and whether he will explain why no such provision has yet been made, although the patient is living in a small cottage with his mother and brother

    1177
    and is a source of infection to his family and the neighbours?
    Mr. MASTERMAN: I am informed that the medical adviser reported this case to the insurance committee on 24th January. Acting on his report the committee have taken steps to secure the admission of the patient to the Radcliffe Infirmary, where he will be accommodated in a few days. At present his case is unsuitable for a sanatorium, but if he improves they propose to send him to a sanatorium for a substantial period.

    DISPENSERS.
    Mr. TOUCHEasked whether a dispenser whose experience is much more extensive than that of a dispenser to a doctor or institution, and who has been engaged in business on his own account for twenty-eight years but is not a member of the Pharmaceutical Society, is authorised to go on the panel to dispense prescriptions which do not contain scheduled poisons; and if it is in the power of the Commissioners to make regulations whereby experienced men of this type can be placed on the panel, especially in districts where the public have no other adequate means of conveniently obtaining medicines?
    Mr. MASTERMAN: I do not think I can add anything to the many previous answers which I have given to similar questions, except that the matter is now receiving consideration.
    Mr. CASSEL: Can the right hon. Gentleman consider further the suggestion I made yesterday, which he appeared to regard favourably, of a small Committee of Inquiry?
    Mr. MASTERMAN: I have considered it, and also the report of a deputation which was received yesterday. Perhaps I may be able to make a statement on the subject to-morrow.
    Mr. MILDMAYasked the Secretary to the Treasury whether he is aware that many doctors are intimating to insured patients residing at a greater distance than three miles from a qualified chemist that they will be unable to dispense medicines for this class as in the past, in consequence of the amount of intricate clerical work now required of them in this connection; and will he explain how it is intended that this difficulty should be met in view of the inability of working men to
    1178
    afford the expense or the time for a journey of over three miles to a chemist?
    Mr. MASTERMAN: I know of no reason why any such intricate clerical work as is suggested in the question should be required from doctors dispensing medicines in rural areas. Doctors dispensing in such areas may be permitted to receive a flat rate per insured person where the capitation system is in force, or per prescription where the attendance system is in force.
    Mr. MILDMAY: Is the right hon. Gentleman aware that doctors have the power and are exercising the power of refusing to dispense medicines for those living at a greater distance than three miles from a chemist, and how does he propose that the difficulty shall be met?
    Mr. MASTERMAN: I am not sure about that. I do not think any case of that sort has been brought to my notice. I will look into the matter.

    CONTRIBUTION CARDS.
    Lord ROBERT CECILasked the Postmaster-General whether, where a man is employed by the Post Office for part of his time only at a wage of less than 7s. a week and fills up his time with other employment, bringing his weekly wage over that amount, the Post Office decline to stamp his insurance card; and, if so, for what reason?
    The POSTMASTER-GENERAL (Mr. Herbert Samuel): In the absence of fuller particulars I am unable to reply definitely to the Noble Lord's question. Probably the person to whom he refers is a deliverer of letters paid by means of an allowance to the postmaster and employed for not more than eighteen hours a week. Such employment has been specified by the Insurance Commissioners as a "subsidiary employment." within the meaning of Section 1 of Part II. of the First Schedule to the Act; and a person so employed is not liable to compulsory insurance in respect of such employment.

    SICKNESS BENEFIT.
    Mr. BARNESasked the Secretary to the Treasury if he is aware that many persons in Scotland have applied for sick benefit, in accordance with the terms of the National Insurance Act, for whom no benefit has yet been forthcoming from the head office; is he aware that indignation has been expressed at the dilatory methods of the authorities; and will he

    1179
    make inquiry and see that the cash payments are at once made to those entitled to them?
    Mr. MASTERMAN: I have no knowledge of any such delay as is suggested on the part of approved societies in Scotland in paying sickness benefit to their members, but if my hon. Friend will give me information as to any particular case, with the name of the society concerned, I will have inquiries made.
    Mr. BARNES: I sent the right hon. Gentleman that information?
    Mr. MASTERMAN: I cannot for the moment recall it.

    PROVISIONAL REGULATIONS.
    Mr. GODFREY LOCKER-LAMPSONasked which of the provisional Regulations issued by the Insurance Commissioners are still in force; which of them have now lapsed altogether; and which of them have been made substantive?
    Mr. MASTERMAN: I will circulate the information with the Votes and Proceedings. [See Written Answers this date.]
    Mr. CASSEL: Will the right hon. Gentleman consider the advisability of framing together the Regulations and Orders that have been made, with an index—it would be a great facility to all who have to use the very voluminous documents?
    Mr. MASTERMAN: I agree; that is quite a good suggestion. I am very anxious as soon as I can get anything permanent in the matter to present it to the House.
    Mr. GODFREY LOCKER-LAMPSONasked whether, in the issue of Regulations and Orders by the Insurance Commissioners, a note can be placed at the head of each Regulation stating the Clause and Section of the National Insurance Act under which such Regulation is issued, so that the public may know in how many cases the National Insurance Act is being altered by Regulation?
    Mr. MASTERMAN: The Regulations themselves indicate under which Section of the National Insurance Act they are issued, but I will bring the suggestion of the hon. Member to the notice of the Commissioners. The Commissioners have no power to alter the Act by Regulation, nor have they done so.

    MEDICAL BENEFIT.
    Mr. NEWDEGATEasked whether, in view of the inconvenience suffered by patients, he can now state whether kidney belts will be included among appliances supplied under the National Insurance Act?
    Mr. MASTERMAN: As I stated on the 11th instant, the suggestion is receiving consideration.
    Mr. NEWDEGATE: What will happen to these people who are suffering while these things are being considered?
    Mr. MASTERMAN: The whole question of the schedule, including the suggestions, are under consideration. I have no doubt there will be some speedy result.
    Mr. NEWDEGATE: How long is it likely to be?
    Mr. MASTERMAN: That I cannot say off-hand; a few days, I should think.
    Mr. RUPERT GWYNNEasked what an insured person is to do who has paid into the insurance fund as soon as the Act came into operation, and who, after being ill at Steyning for a few weeks, has gone to Eastbourne to recruit, and on again becoming ill there has been unable to obtain medical attendance under the National Insurance Act, having applied to four different doctors, all of whom refused to attend to her, in consequence of which she has had to pay herself for medical attendance?
    Mr. MASTERMAN: The proper course in such a case would have been for the insured person to have notified the Eastbourne insurance committee. If the hon. Member will supply me with particulars of the case which he has in mind I will make inquiries.
    Mr. GWYNNE: If the committee does not meet for a fortnight, has the insured person, though ill, to wait till then?
    Mr. MASTERMAN: The insurance committee must make arrangements with its permanent officials to meet such cases.
    Sir PHILIP MAGNUS: Will the right hon. Gentleman undertake to simplify the Regulations under which an insured person, changing temporarily his residence, can obtain medical benefit? They seem very complicated now.
    Mr. MASTERMAN: If the hon. Member or hon. Members can make the Regula-

    1181
    tions more simple for the general convenience in accordance with the Act I shall only be too glad to lay them before the Commissioners.
    Mr. GWYNNEasked the Secretary to the Treasury whether money has been sent by the Insurance Commissioners to approved societies for the payment of benefits; whether he is aware that in many cases secretaries of friendly societies have had to advance sickness and maternity benefit out of their own pockets, and have not yet received repayment; and whether friendly societies or their secretaries are expected in the first instance to finance the Government scheme?
    Mr. MASTERMAN: The sum of £1,226,405 had been issued by the English Commission up to the 11th instant to societies approved under the National Insurance Act for payment of benefits and expenses of administration. Some 700 societies have elected to finance their own expenditure subject to reimbursement under the proviso to Section 26 (1) of the Act instead of giving security to the Commissioners under that Section. This course has been voluntarily adopted by the societies, and subject to a reserve pending audit, the amount expended is promptly repaid from the National Health Insurance Fund month by month upon application. Every approved society which has given security and has applied for funds has received the funds required for the payment of insurance benefits and no such friendly society is expected in the first instance to finance the Government scheme.

    MIDLAND RAILWAY FRIENDLY SOCIETY.
    Mr. NEWDEGATEasked the Secretary to the Treasury whether he is aware that, although since 1879 Midland Railway employés may not have been technically compelled to join the Midland Railway Friendly Society on receiving employment, yet that candidates for such employment would have had a poor chance of being taken on who refused to become members of that friendly society; and whether, under these circumstances, he will strongly advise the Registrar of Friendly Societies to withhold his consent to any diminution of insurance benefits promised by that society?
    Mr. MASTERMAN: I have no knowledge of any facts on which the suggestion in the first part of the question is based. The amendments in question appear to
    1182
    have been duly adopted in manner provided by the rules of the society, and therefore it would not appear to be competent for the Registrar to refuse to register them, since they are not contrary to law, as has been explained several times in answer to previous questions. The Registrar acts in accordance with his statutory duty, and it would be impossible to ask him to adopt a course which would conflict with that duty.

    MEDICAL PANEL.
    Mr. FREDERICK HALLasked the Secretary to the Treasury if approved societies have in a number of instances refused to accept certificates for sick pay allowances under the National Insurance Act which have been signed by doctors who are not on the panel; under what regulations this action has been taken; whether it applies in all cases, even although it may be difficult for an insured person to get a certificate from a panel doctor; and if he will consider as to a modification of this procedure?
    Mr. MASTERMAN: As I have stated in answer to several similar questions, it rests with societies to determine what evidence of sickness they will require, subject to appeal to the Commissioners under Section 67.
    Mr. F. HALL: Is it not a fact that insured persons have now been informed that the certificates of non-panel doctors will be accepted?
    Mr. MASTERMAN: Perhaps I may refer the hon. Gentleman to the speech I delivered here yesterday; I dealt very fully with the whole question.
    Mr. F. HALL: Has that attitude not been adopted in consequence of the action of some of the insured people who could not previously obtain a medical certificate from non-panel doctors?
    Mr. MASTERMAN: There has never been any change in policy; and there has never been any attitude adopted except one, and that is the attitude of carrying out the National Insurance Act.

    Domestic Produce.
    Colonel BURNasked the Prime Minister, with reference to his statement at Leven that the census of production proved that out of a total production of commodities valued at £706,000,000 the exports amounted to only £176,000,000, whether his attention has been drawn to

    1183
    the fact that the Annual Trade Returns for 1907 show that the exports of domestic produce were valued at £426,000,000, of which more than £341,000,000 were classed as manufactures; and whether he will explain the discrepancy between these two statements?
    The PRIME MINISTER: I was referring to the completely manufactured products of industry—goods in their final stage. The figures which I gave in my speech—i.e., a total of 716 millions—not, as suggested, 706 millions—out of which 176 millions were exported, will be found on page 26 of the final Report of the Census of Production of the United Kingdom, 1907 [Cd. 6320], and I would refer the hon. and gallant Member to that document for the calculations on which these figures are based.
    Colonel BURN: Is it a correct inference from the figures in question that less than one-half of the manufactured exports represent British labour?
    The PRIME MINISTER: That is very disputable.

    Rural Credit Banks Bill.
    Mr. HAMERSLEYasked the Prime Minister whether next Session he will arrange to give facilities for the consideration and passage of the Rural Credit Banks Bill?
    The PRIME MINISTER: I can make no promise as to next Session, but the claims of this Bill will receive consideration.

    Crown Prosecutions (Ireland).
    Mr. SWIFT MacNEILLasked the Chief Secretary whether he is aware that the hon. and learned Member for South Tyrone is himself Crown Prosecutor, paid out of moneys voted by Parliament, at the Assizes for the county of Cavan, a position to which he is appointed on each occasion by the Attorney-General for Ireland, as his representative on behalf of the Crown; and whether he will consider the advisability of making the position of Crown Prosecutor not compatible with a seat in the House of Commons?
    Mr. BIRRELL: The hon. and learned Member for South Tyrone is Senior Crown Prosecutor for county Cavan. By long standing custom a Crown Prosecutor continues to act as such after his appointment, and is not reappointed at each Assizes by the Attorney-General. It is not
    1184
    considered desirable to make the change in the position suggested in the question.
    Mr. SWIFT MacNEILL: Does not the right hon. Gentleman see that under the present system a Gentleman may be advising resistance to the Government one day, and prosecuting, as representing the Government in a criminal case the next?
    Mr. BIRRELL: The Attorney-General has complete control over these prosecuting counsel and if any of them overstep the proper limits he can remove them.
    Mr. SWIFT MacNEILL: Is the right hon. Gentleman aware that some of these prosecuting counsel actually criticise the action of the Executive Government in criminal administration? Has he seen a question to-day, put down by this Gentleman, in reference to the number of cases in which the Lord Lieutenant has exercised the prerogative of mercy?
    Mr. BIRRELL: It is very wrong to criticise the Executive, particularly for a person occupying such an office as that of Crown Prosecutor. I hope in future they will refrain from doing so.

    Land Valuation.
    Captain CRAIGasked whether, in cases where a provisional valuation has been objected to, upon the owner agreeing not to plead the statute of limitation for the collection of the halfpenny tax under the Finance Act, the assessment may be allowed to remain outstanding until the original valuation is fixed?
    Mr. MASTERMAN: I would refer the hon. Member to the provisions of Section 27 (6) of the Finance (1909–10) Act, 1910, which deal in an equitable manner with the class of case to which he alludes.

    Postal and Telegraph Facilities (Annathill, Lanarkshire).
    Mr. DUNCAN MILLARasked the Postmaster-General whether, having regard to the local feeling existing in Annathill, Lanarkshire, in favour of the provision of a local telegraph and telephone service, and of the establishment of a branch Post Office Savings Bank there, he will consider as to providing such facilities at the Annathill post office?
    Mr. HERBERT SAMUEL: As the hon. Member was informed in June last, the small amount of business likely to be transacted would not warrant the provision of

    1185
    a telegraph or telephone call office at Annathill, and there has been no change in the circumstances since then. I am making inquiry concerning the provision of savings bank facilities at Annathill, and will communicate with the hon. Member on that point.
    Mr. DUNCAN MILLARasked whether, having regard to the inconvenience caused to the public by the collection of letters at Annathill post office, in Lanarkshire, at 6.15 p.m., and to the fact that the letters are not dispatched from the post office until 8.7 p.m., he will take steps to have the collection delayed until a later hour and the box kept open until at least 7 p.m.?
    Mr. HERBERT SAMUEL: The letters leave Annathill post office at 6.15 p.m., and are dispatched by the 8.7 p.m. train from Glenboig. A collection from Annathill as late as 7.0 p.m. would involve additional expense which would not be warranted by the circumstances.

    Telephone Service.
    Mr. NORTON - GRIFFITHSasked the Postmaster-General (1) if he is aware of the delays which take place in the installation or extension of the telephone service throughout the Midlands; that many weeks elapse before a service can be obtained, yet alone repairs to existing services; and whether, in view of the importance of the matter to one of the leading industrial centres of this country, he will have special inquiries made with a view to giving a quick service to those requiring a telephone; (2) if the delays in connection with the installation of telephones in the Birmingham district are caused through the number of men not being sufficient to cope with the demand; and if he will inquire as to whether any addition to the present engineering staff can be made; and (3) if he is aware that the Birmingham post office telephone authority has stated that certain routes at Darlaston are full and that they cannot take any more subscribers until additions have been made, which, it is stated, will take some months; and, in view of the importance of this industrial centre and the inconvenience and loss of trade which is likely to result through such delays, if he can state what steps he proposes to take in the matter?
    Mr. HERBERT SAMUEL: I am aware that in the Birmingham district, as in some other parts of the country, there is
    1186
    delay in providing lines for new subscribers, and in some cases for existing subscribers who remove to new addresses. Owing to the diminution of construction works by the National Telephone Company during the last few years of their licence, large numbers of new underground lines are now required, and numerous exchanges have to be provided or extended in addition to those constructed by the Post Office last year. Such works necessarily occupy a considerable time, but they are being urgently pressed on, and the ordinary staff is being increased for the purpose as rapidly as good workmen can be obtained.
    Sir J. D. REES: Is the right hon. Gentleman aware that on the occasion of the last great storm, when the telephones were under private management, the repairs were proceeded with promptly; and is he aware that it is believed that it is red tape that is strangling the repairs?
    Mr. HERBERT SAMUEL: Those questions have nothing to do with the question of storms.
    Mr. BRADY: May I ask the right hon. Gentleman, in reference to the delay, is it not a fact that a considerable delay over twelve months—has taken place in Dublin in consequence of the lack of mains, and will the activity spoken of be extended to that city to lay down the mains for the purpose of supplying the telephones?
    Mr. HERBERT SAMUEL: Yes, as I have already stated in reply to previous questions, every effort is being made to meet the arrears of construction work in Dublin which followed on the transfer of the system.

    Post Office (Scotland).
    MARQUESS of TULLIBARDINEasked the Postmaster-General what is the profit or loss in running the Post Office in Scotland in the last year of which there is a record, excluding the cost of taking over the National Telephone business?
    Mr. HERBERT SAMUEL: For the year ended the 31st March, 1911, the net profit in running the Post Office in Scotland is estimated at £310,000.
    MARQUESS of TULLIBARDINE: Could not something like £300 of it be spared for the islands of the West Coast?
    Mr. HERBERT SAMUEL: Yes, we are spending more than £300 on the islands of the West Coast.

    Telegraph Service, Scotland (Deficit).
    MARQUESS of TULLIBARDINEasked the Postmaster-General why he has particularly chosen the Board of Agriculture in Scotland as the Department which ought to subscribe towards the deficit in respect of the telegraph service to the islands of Rhum, Eigg, Muck, and Canna; and why the Postal Department, the Northern Lights Commissioners, the Admiralty, or the War Office have not been approached in a similar manner in the matter?
    Mr. HERBERT SAMUEL: I suggested that the Board of Agriculture in Scotland might take part in the telegraph guarantees to which the Noble Lord refers, because that Department already contributes in other cases. The Post Office now bears two-thirds of the loss under every telegraph guarantee. It has not been the practice of the Northern Lights Commissioners, the Admiralty, or the War Office to take part in guarantees.
    MARQUESS of TULLIBARDINE: Has not the Board of Agriculture probably less to do with the questions concerned, and the other Departments more, and might not the right hon. Gentleman approach the other Departments; incidentally may I ask if he has approached the Board of Agriculture yet?
    Mr. HERBERT SAMUEL: Yes, some communications have passed between the Department and the Board of Agriculture, which acts on behalf of the inhabitants to develop the district. I do not know that the War Office, and to some slighter extent the Admiralty, are very much concerned in these matters.

    Postal and Telegraph Rates (Overseas).
    Mr. HARRY LAWSONasked the Postmaster-General whether his attention has been drawn to the Postal and Telegraphic Conference now sitting at Tokio; whether he is aware of the disproportion between the telegraphic rates between this country and North China and Japan and the new rates to Hong Kong; and whether he will make representations in favour of lower rates for Press and general messages to the Great Northern Telegraph Company and the Eastern Extension Telegraph Company?
    Mr. HERBERT SAMUEL: My attention has been drawn to the conference in question; and I am glad to know that one of its results is likely to be a substantial reduction in the rates for ordinary and Press telegrams between this country and China and Japan.

    Central Telegraph Office (Medical Advisers).
    Mr. WILLIAM THORNEasked whether it is in contemplation to withdraw from the officers of the Central Telegraph Office the privilege of selecting their own medical advisers; if not, whether he will inquire into the circumstances under which surprise visits have been paid by Post Office medical officers to the homes of patients of private practitioners; and whether he will direct that such visits shall not be paid in future unless grave reasons to suspect malingering exists?
    Mr. HERBERT SAMUEL: I have no intention of withdrawing from officers of the Central Telegraph Office the privileges in question. The practice that visits should occasionally be paid by the headquarters medical staff is of long standing, and I see no reason for modifying it.

  ROYAL NAVY.

    ARTISANS' RATINGS.
    Sir C. KINLOCH-COOKEasked the First Lord of the Admiralty whether he is aware that on His Majesty's ship "Bellerophon," first battle squadron, naval shipwrights have been ordered to scrub a portion of the flying deck daily and carpenter's mates to clean finger plates on cabin doors; and, seeing that these duties are an infringement of the Admiralty letter specifying that artisan ratings must be employed at the work of their craft, will he make inquiries into the matter and see that the spirit of this letter is duly carried out?
    The FIRST LORD of the ADMIRALTY (Mr. Churchill): Nothing is known at the Admiralty of the circumstance referred to, and I am advised that it is not considered necessary to make inquiry.

    CAUSEWAY AT HAULBOWLINE.
    Mr. F. HALLasked the First Lord if he has received a resolution from the Freemount Division of the Hibernian Order as to the urgent necessity for proceeding with the scheme of the proposed Cause-

    1189
    way from Paddy's Block, Ringaskiddy, to Haulbowline; if he will state what particular interest the Hibernian Order has in this proposal; the nature of its urgency; the date when the decision to carry out the work was come to; the purpose of the works; and the reasons for the delay to which this organisation has found it necessary to call attention?
    The PARLIAMENTARY SECRETARY to the ADMIRALTY (Dr. Macnamara): The resolution referred to by the hon. Member does not appear to have been received. The question of building a bridge between Paddy's Block and Haul-bowline has been before the Admiralty from time to time, and I hope to examine the subject personally when I visit Haul-bowline to hear petitions, but I cannot give any undertaking in the matter.
    Mr. F. HALL: Would the right hon. Gentleman like me to bring the resolution under his notice?
    Dr. MACNAMARA: Yes. I should be glad to see it.

    ARREST OF SEAMEN BY CIVIL AUTHORITIES.
    Sir C. KINLOCH-COOKEasked the First Lord whether he can explain the arrangements under which local police authorities at the Home ports have been instructed to hand over to naval custody men belonging to His Majesty's ships who may be arrested for minor offences; can he give any precedent for such an order; and will he state the Act of Parliament giving the Lords of the Admiralty powers to assume jurisdiction over the police?
    Mr. CHURCHILL: The object of the arrangements in question was to prevent a certain inequality of treatment which was involved in the previous somewhat haphazard system under which seamen who were found drunk in the streets might be taken in custody by the police or handed over to a naval patrol, the result being that men might be punished by the civil or naval authority. Punishment by the former carries with it certain additional consequences to the men in regard to service privileges, honours, and marks of distinction, and it is with a view to the adoption of a more even and equitable treatment that the arrangements were proposed. The legal aspect of the matter is being dealt with by my right hon. Friend the Home Secretary in his reply to-day to a similar question.

    LOSS OF PAY (CONTRACTORS' MEN).
    Mr. FALLEasked whether all the contractors' men working on His Majesty's ship "King George V." at Portsmouth lost two days' work and pay on the occasion of His Majesty's visit, and if he can give the reason for this state of affairs; and if he will take steps to make up for the loss to these men if such loss is not due to any fault of their own?
    Dr. MACNAMARA: The dockyard workmen employed on His Majesty's ship "King George V." were employed elsewhere on the day of His Majesty's visit, and received their usual pay. No doubt the hon. Member has in mind the case of the men employed by the machinery and gun-mounting contractors, as to whom I am making further inquiry. It would certainly not be the wish of the Admiralty that they should suffer any financial loss in the circumstances.

    Depredations of Trawlers.
    Mr. MACPHERSONasked the Secretary for Scotland whether his attention has been drawn to the depredations of trawlers around the coast of Northern Scotland; and whether he will provide additional fishery cruisers in that region to secure effective policing of the coasts?
    The SECRETARY for SCOTLAND (Mr. McKinnon Wood): A few complaints of illegal trawling on the North coasts of Scotland have been inquired into recently and found to be well founded, but there is no reason to suppose that the depredations have been such as the present fleet of cruisers cannot effectively check.

    Small Holdings.
    Mr. MACPHERSONasked the Secretary for Scotland whether he has received any complaints from the Highlands of Scotland with reference to the inactivity of the Board of Agriculture; whether he is aware that thousands of applicants have applied for holdings; and whether, in view of the fact that in some of the counties no steps have been taken to satisfy those applicants, he will consider the advisability of appointing additional Sub-Commissioners to cope with the work?
    Mr. McKINNON WOOD: The reply to the first and second parts of the question is in the affirmative; inquiries have been made by the Board in every county in Scotland from which applications have been received; the appointment of additional Sub-Commissioners would not facili-

    1191
    tate procedure, because the Board has already received as many reports from the present Sub-Commissioners as it can deal with at present. Where necessary we have appointed competent men to make special reports, as in the case of Lewis, but the permanent appointment of more Sub-Commissioners is not at present necessary.
    Mr. MACPHERSONasked whether a Sub-Commissioner has visited the farm of Balgown, Ardwall, near Stanraer, Wigtownshire; whether he has measured it for small holdings; whether suitable applicants are available for these holdings; and, if so, whether they will be able to take these holdings over?
    Mr. McKINNON WOOD: The reply to the first part of the question is in the affirmative. The Board of Agriculture is considering a proposal to form a settlement on the farm, but it is too soon to make a statement on the subject.

CAPTAIN SCOTT'S ANTARCTIC EXPEDITION.

  MEMORIAL SERVICE, ST. PAUL'S CATHEDRAL.
  Colonel YATE: I beg to ask the hon. Member for St. George's-in-the-East, as representing the First Commissioner of Works, a question of which I have given him private notice: Whether it would be possible for a few seats to be reserved in St. Paul's Cathedral to-morrow to enable any Members of this House who wish to do so to attend the memorial service to Captain Scott?
  Mr. WEDGWOOD BENN: The seating accommodation at St. Paul's does not concern the First Commissioner, but on receipt of the hon. and gallant Member's question he communicated with the proper authorities and desired that some seats should be reserved for Members of Parliament.

GLASGOW CARTERS' STRIKE.
Mr. MacCALLUM SCOTT: I beg to ask the President of the Board of Trade a question, of which I have given him private notice: Whether any steps have been taken by the Board of Trade to bring about a settlement of the carters' strike in Glasgow?
The PRESIDENT of the BOARD of TRADE (Mr. Buxton): I understand the
1192
carters are now in negotiation under the auspices of the Glasgow Chamber of Commerce, and I hope for satisfactory results.

ORDERS OF THE DAY.

  BUSINESS OF THE HOUSE.
  Mr. BONAR LAW: Perhaps the Prime Minister would make a statement about the business for to-day and to-morrow?
  The PRIME MINISTER: To-day we take the Appropriation Bill, and the discussion on Indian Finance; thereafter the Report stage and Third Reading of the Railways Bill, the Third Reading of the Pensions (Governors of Dominions) Bill, and—I understand it is agreed—the four Charities Bills and the Employment of Children Bill—which is also, I believe, substantially agreed.
  To-morrow the House will meet at Twelve o'clock, and the first Order will be the Third Reading of the Appropriation Bill, and the concluding stages of the Bills I have mentioned to-day, and thereafter the Adjournment Motion.
  Sir FREDERICK BANBURY: I object to the Employment of Children Bill very much.

MARCONI COMMITTEE.

  EVIDENCE OF MR. MAXSE.
  Sir ALBERT SPICER: I desire to ask you, Mr. Speaker, a question in relation to the report presented on behalf of the Marconi Wireless Telegraph Company, Limited, Agreement, as to what action you propose to take in the matter?
  Mr. SPEAKER: I have read the Report presented by the hon. Member on behalf of the Committee, and it does not appear to me that I have to take any action—at least not to initiate any action. I shall act, of course, ministerially as Spokesman of the House if the House thinks fit at any future time to take any action. But I do not think it would be according to precedent or right for me to take any action on my own initiative, and I shall wait until I am instructed by a Resolution of the House. I do not know whether the Prime Minister wishes to make any statement in regard to the matter. I think the indication would come from him as to what action he thinks the House might properly take.
  The PRIME MINISTER: Perhaps I may say that, like the majority of Members, I have only had time to give a very cursory perusal to the Report of the Committee cir-
  1224
  culated this morning. I understand that the Committee has adjourned for this Session. In the circumstances, and having regard to the stage of the Session we have reached, and of the importance, as all experience shows, of proceeding in matters of this kind only after full opportunity of consideration and deliberation, I am not prepared to assume the responsibility of advising the House to take any immediate action.
  Captain MURRAY: May I ask whether the Prime Minister will consider the advisability of referring the report to the Committee of Privileges?
  The PRIME MINISTER: I do not know why I should do that. It is not a question of privilege at all.
  Mr. JOHN WARD: Does the right hon. Gentleman think it necessary to take any further proceedings whatever relating to this case, in view of the fact that the gentleman has refused to substantiate the accusations he made?
  The PRIME MINISTER: I do not think I could usefully add anything to what I have said.

CONSOLIDATED FUND (APPROPRIA TION) (No. 2) BILL.
Considered in Committee, and reported without Amendment; to be read the third time To-morrow (Friday).
EAST INDIA (FINANCE).

  PURCHASES OF SILVER (MESSRS. SAMUEL MONTAGU AND COMPANY).
  Mr. RUPERT GWYNNE: I beg to move, "That a Select Committee be appointed to inquire into the administration of Indian Finance and Currency by the Secretary of State for India and Council of India, and the responsibility and powers vested in the Finance Committee, in special relation to the recent purchases of silver and the distribution of cash balances."
  I think it will be generally admitted on both sides of the House that the opportunities which we have for discussing Indian affairs are far too few, and therefore it is a matter of regret that this opportunity which has been afforded to us for discussing financial questions in relation to India should come on at a time

  1225
  when hon. Members are worn out and anxious to get away. The terms of my Motion are not so wide as many of those who are interested in Indian affairs would wish to see them, but on the present occasion it has been thought advisable to somewhat limit the terms of this Motion because there are other matters affecting the finances of India which require attention, but which I feel would be dealt with better by a Royal Commission, and these particular matters relating to the purchase of silver and the distribution of cash balances seem to be matters which might be more properly and more promptly dealt with by a Select Committee. I should like to say at once that my first complaint against the India Office is the difficulty which we on this side of the House have experienced during the last four months in obtaining information as to the recent purchases of silver. I do not for a moment blame the hon. Member for Accrington (Mr. Harold Baker), on whose shoulders the responsibility has fallen of answering the various questions which have been put to him, but I think that one may fairly say that the powers of prevarication which the India Office have exhibited are as fully developed as it would be possible for any Government Department to exhibit. We have been forced time after time to put question after question before we could get at the real facts of the case. A short time ago the Prime Minister resented somewhat a suggestion made by the Leader of the Opposition when he stated in this House that information on this subject had to be extracted from the Government as if we were drawing teeth. As I have been one of those who have endeavoured to bring about that process, I should like to take one example of this prevarication and this reluctance on the part of the India Office to give information. At the start no one was aware of what had taken place with regard to the placing of this contract. We were all in the dark, and I put down a question asking for a copy of the contract with Messrs. Samuel Montagu and Company for the purchase of silver and a copy of the terms on which they were instructed to purchase, and this is the reply I received:—
  "Mr. H. Baker: No formal contract for the purchase of silver was entered into with Messrs. Samuel Montagu and Company. Letters of instruction were sent on each occasion, and, with the hon. Member's permission, I will circulate copies of them with the Votes, together with a specimen of the contract notes that were furnished in respect of the several purchases."
  1226
  I then put the following supplementary question:—
  "May I ask if he will give the complete correspondence and not merely extracts from certain letters, as he has done previously?"
  To which the Under-Secretary replied:—
  "No, I think it was complete."—[OFFICIAL REPORT, 19th November, 1912, col. 96, Vol. XLIV.]
  That was on the 19th November, 1912. When I had looked through the correspondence which I had been given, I put down another question on the 22nd of November, in which I asked the Under-Secretary of State for India—
  "if lie will give the complete correspondence which has taken place this year between the India Office and Messrs. Samuel Montagu and Company in regard to the purchases of silver, instead of extracts from certain letters, as already furnished?"
  The Financial Secretary (Mr. H. Baker) replied:—
  "The correspondence circulated in accordance with the hon. Member's previous question consisted of the full text of the letters instructing Messrs. Samuel Montagu and Company to purchase, and of such letters from the firm as were mentioned therein. In no case was an extract given. I am now circulating with the Votes copies of such other letters as were received relating to the various orders and to the terms."—[OFFICIAL REPORT, 22nd November, 1912, col. 678, Vol. XLIV.]
  I read through those letters, and I found that reference was made to other correspondence which did not appear. Consequently, on the 27th of November, I asked the Under-Secretary:—
  "If he will give copies of the replies of Messrs. Samuel Montagu and Company to the letter written to them by the India Office on 3rd September and 11th September of this year, which has been omitted from the correspondence asked for on 22nd November?"
  The Financial Secretary replied:—
  "I am circulating with the Votes a copy of the firm's reply to the letter of the 11th September, which was omitted by an oversight from the correspondence previously circulated."
  When I got that information I then found that there was other information which had been kept back, and I asked for the White Paper containing the full and complete correspondence, and on the 17th December a White Paper was issued, from which there was omitted the beginnings and endings of all letters, which may not be very material in ordinary cases, but in this particular case it is important, because it is necessary to see who had written and who had signed these various papers. The important thing is that when eventually we did get this White Paper, after four different efforts to get the complete correspondence, and when it became patent what I wanted to get at, we found that the letter of 8th January, 1912, had been deliberately kept back the whole time.

  1227
  This letter was a most remarkable production, and it is so fantastic that I will ask the House to allow me to read it:—
  "January 8th, 1912.
  "To Sir Felix Schuster, dated 8th January, 1912. "We venture to make a suggestion to you with regard to silver purchases for the Indian Government which you may consider as of value.
  "From our careful study of the statistical position of the Indian Treasury reserves, it appears to us that the time is not far distant when it will be considered prudent for them to strengthen themselves by coining rupees.
  "You will not fail to have remarked, if you have read our circular, that The net is being spread in the sight of the bird.' If, therefore, you postpone your purchases until you are absolutely pressed for currency, the chances are that you will have no other supply available beyond that that is being nursed for you by Indian speculators. The inevitable result being that you will have to pay more or less whatever you are asked by them."
  4.0 P.M.
  [HON. MEMBERS: Hear, hear.] Hon. Members who say "Hear, hear" will perhaps wait my comment upon that. They must not think I have finished when I have done reading. I shall have a few observations to offer:—
  "Our proposal is this: We receive consignments from special clients of our own, of silver peculiarly adapted to coinage purposes, averaging about £50,000 per week, which we have to sell at the market prices.
  "We suggest that we put this silver down to your account at the market prices ruling on the days we make the sale, and deposit it in the Bank of England for your account.
  "We should not in the least disturb the market because we should make no purchases for the Council 'at fixing,' and, what is most important, no one would have the remotest idea that you were buying, and prices would not, as has been the invariable case in the past, be run up against you, as the amount of silver passing through our hands is, as you can well imagine, vastly more than £50,000 per week.
  "Putting silver into the Bank of England is such an everyday occurrence just now, that our doing so would create no comment.
  "We particularly do not care about approaching Edwin Montagu on this matter for reasons that must be obvious to you.
  "We do not see, however, that our close relationship to this gentleman should militate against the Indian Council's doing business with us if they conscientiously think that it is to their advantage to do so."
  That is followed the next day by this short, but significant letter:—
  "Dear Sir Felix Schuster,
  "Of course there would be no need for the Bank of England to be made acquainted with your purchases. They need only be told that they are to receive the silver against loans. This method, would, I think, close every possibility of a leakage.
  "Yours very truly.
  "E. L. FRANKLIN."
  Up to that time, so far as the India Office was concerned, it had not occurred to the Secretary of State or to any of his financial advisers so far as we can find out, that there was any reason for them to alter the ordinary process by which they had in the past been in the habit of making their purchases of silver. They had had no
  1228
  reason to complain of the way in which the Bank of England had carried through their business in the past. It had been the custom of the India Office when silver was required to instruct the Bank of England who, in their turn, instructed one of the bullion brokers to make the purchases. So far as we can see the India Office, far from being dissatisfied with the Bank of England, were so satisfied that in 1906 they entered into an agreement with the Bank of England to carry out the purchases on specially reduced terms for seven years. Yet, after the receipt of this letter from Messrs. Samuel Montagu and Company, it seems to have suddenly occurred to Sir Felix Schuster that something must be wrong with the way in which the work had been carried out through the Bank of England. This heaven-born inspiration which seized Mr. Franklin of Messrs. Samuel Montagu and Company, or Sir Felix Schuster, or all of them at the same time, seems to have had great authority with the Financial Committee of the India Office. Let me take this letter sentence by sentence:—
  "We venture to make a suggestion to you with regard to silver purchases for the India Government which yon may consider of value. From our careful study of the statistical position of the India Treasury reserves, it appears to us that the time is not far distant when it will he considered prudent for them to strengthen themselves by coining rupees."
  I do not know what special information Messrs. Samuel Montagu and Company had with regard to the India Treasury Reserves, but apparently their information must have been greater than the India Office themselves possessed, because in answer to a question on 12th November the hon. Member for Accrington said to me this:—
  "In January rupees in the Reserves of the Indian Government had not fallen so low as to show purchases would be required."
  And yet Messrs. Samuel Montagu and Company knew they would be required. That only shows they had considerable knowledge and had carefully studied the position of affairs. Let us go on to the next sentence:—
  "You will not have failed to have remarked if you had read our circular that 'the net is being spread in the sight of the bird.' If, therefore, you postpone your purchases until you are actually pressed for currency, the chances are you will have no other supply available beyond that that is being nursed for you by Indian speculators, the inevitable result being that you will have to pay more or less whatever you are asked by them."
  If you turn to Sir Guy Fleetwood Wilson's speech, which he made on 1st March last year—which was after this letter was

  1229
  written—in introducing the Indian Budget, you will see he said this—
  "The absorption of rupees in the intervening three years has been about 32 crores; and, by whatever test the figures are tried, it is clear that the demand has been less active than in the early years of the century, when the resourses of our Mints were severely strained to meet the calls of trade for silver currency. This change in the habits of India, swift and momentous in its possibilities, has defeated the calculations of the silver speculators. It has also absolved me from the necessity of undertaking fresh coinage, in spite of no inconsiderable pressure from interested quarters."
  That is a very remarkable statement, because, if that was true, it distinctly contradicts the Messrs. Montagu's letter. The suggestion that anyone could make a corner in silver is positively fantastic. Let us deal with this mysterious ring in India who were going to corner the Government in silver. It is common knowledge that there is a big native financier of the name of Choonilal, who is, I believe, chairman of the Specie Bank out there, who had been buying up considerable quantities of silver in the expectation I imagine of a rise in price. You may buy things for a rise in price without trying to corner them. It is a totally different thing to buy certain quantities of a thing because you think the price is going up from saying you are going to make a corner, and make it impossible for the whole world to buy except through you. The world's output of silver is from £25,000,000 to £28,000,000 worth per year. Choonilal and those associated with him had not accumulated more than £5,000,000 worth, and that had been accumulated out of the preceding year's output. How can it be suggested, therefore, they were going to corner the whole of the £25,000,000 or £28,000,000 worth in 1912? It was admittedly a matter of surprise in the bullion market that that group had been able to hang on to their silver so long. Surprise was expressed in various bullion circulars week by week that they were able to hold on so long to their silver. Yet it is suggested this man and those associated with him were going to corner the silver of the whole world, and that the India Office was going to be entirely dependent upon them—
  "Our proposal is this. We receive consignments from special clients of our own of silver peculiarly adapted to coinage purposes, averaging about £50,000 per week, which we have to sell at the market prices.
  "We suggest that we put this silver down to your account at the market prices ruling on the days we make the sale, and deposit it in the Bank of England for your account."
  What do they mean by "silver peculiarly adapted to coinage purposes?" Silver either comes from the mines or it is re-coinage. If it comes from the mines, it is either high or low quality silver. If
  1230
  it is low quality, it is not suitable for coinage, but, if it is high quality, it is suitable. Why do Messrs. Samuel Montagu and Company say their silver is peculiarly adapted for coinage purposes? A stockbroker might as well write and say he has some specially good Consols to sell. Messrs. Samuel Montagu and Company have no different silver from that in which other bullion brokers deal—
  "We should not in the least disturb the market because we should make no purchases for the Council at fixing' and what is most important no one would have the remotest idea that you were buying and prices would not, as has been the invariable case in the past, be run up against you."
  That statement is absolutely untrue, because it did disturb the market, and the price did go up. If it was true, they would be able to put £50,000 worth of silver per week quietly to the account of the India Office without raising the price in anyway, then they were not acting in the best interests of those clients who had entrusted them with the sale of the silver. Did not the Secretary of State see they were placing themselves in an impossible position? They were entrusted by certain clients to sell silver at the best prices, and those best prices were the market prices, but they were trying to keep the market prices down by secrecy, and by doing so they must have been acting unfairly to those clients; otherwise, the statement is not true. It may surprise right hon. and hon. Gentlemen opposite that one should want justice for other people when he is not himself interested. I do not know from whom the silver came, but we are entitled to look at the bona fides of a firm who are acting in a dual capacity. Can they act fairly in a dual capacity when they are going to keep down the prices? As a matter of fact, that paragraph is not true. They did not confine themselves to buying £50,000 worth in this way from their own clients. A large proportion was bought abroad from other sources. If you follow the contract notes throughout, you will see a great deal was bought in the market and not in this secret way.
  "We particularly do not care about approaching Edwin Montagu on this matter for reasons that must be obvious to you."
  There the India Office quite directly had their attention called to the undesirability of placing this work with a firm so closely connected with the Under-Secretary of State. Lord Crewe, speaking in another place on 14th November, defended this action in the following words:—
  "It must be remembered that as a matter of fact Mr. Montagu has no more to do with the finance of India at the India Office than he has to do with the

  1231
  finance of the Panama Canal, and he has no more connection with the firm of Samuel Montagu and Company than with the firm of Marshall and Snelgrove."
  I do not in the least wish to make any attack or any suggestion that this contract was obtained for Messrs. Samuel Montagu and Company either by the influence of or at the wish of the Under-Secretary of State. I admit at once without reservation that I do not believe that at the time this letter was writen or when it was received the Under-Secretary of State knew nothing about it at all. On the contrary, to use an expression of which Messrs. Samuel Montagu and Company themselves seem rather fond, I think they spread their net and the Under-Secretary was the bird they caught. I think, so far as the Under-Secretary of State is concerned, he might say not "spare me from my friends," but "save me from my relations." He has been placed in a most unfortunate position, and my only regret is that he is not here himself to-day in order that I may make these statements in his presence. Let me say at once that is not my fault. We have not proceeded with this discussion until there has been ample time for the Under-Secretary to come back from India three or four times. [An HON. MEMBER "Why should he come?"] Because it is most desirable that when a question of this sort is being raised there should be an official representative of the India Office in this House. Entirely apart from the fact that there is this charge in connection with his own family, in his own position—
  The PRIME MINISTER (Mr. Asquith): What is the charge against the Under-Secretary?
  Mr. GWYNNE: I have said distinctly I make no charge against the Under-Secretary. This charge is against the Government for having permitted contracts to be given to the family of the Under-Secretary, and, quite apart from the fact that the Under-Secretary is connected with the firm of Messrs. Samuel Montagu and Company, when there was a question of an investigation or allegation of any kind against the India Office, I think it would have been much better if he came back so as to be in his place, quite apart from personal consideration, because we have had to get the information from someone who obviously was not in the same position to give it as the Under-Secretary would himself have been. So far as regards Lord Crewe's sugges-
  1232
  tion that the Under-Secretary had no more to do with the finance of the India Office than with the finance of the Panama Canal, I must remind the Noble Lord that the Under-Secretary, whatever his position or whatever part he takes in the discussions of the Finance Committee, is, so far as this House is concerned, the sole representative of the India Office, and it is his duty often to explain the financial policy of the India Office, and therefore it was his duty to know what was going on in the Finance Committee so that he could keep the House informed, and, if they wished it, to inform them of the transactions and the work of that Department. So far as the second suggestion of Lord Crewe is concerned, that, the Under-Secretary has no more to do with the firm of Messrs. Samuel Montagu and Company than with the firm of Messrs. Marshall and Snelgrove, that is really putting it too high. I think it would be quite impossible to conceive of any case in which a Member of the Government could be more closely connected with a firm than the Under-Secretary is with the firm of Messrs. Samuel Montagu and Company.
  It is very unpleasant to have to go into details of this kind; it is difficult to do so in the absence of the hon. Gentleman, but I think that after Lord Crewe's statement I am bound to remind the House exactly what the situation of this firm is. There is, first, Lord Swaythling, and then there is Mr. Gerald Montagu, both of them brothers of the Under-Secretary. There is Sir Stuart Samuel, brother of the Postmaster-General and cousin of the Under-Secretary. There is Mr. Franklin, who was so prominent in carrying on these negotiations, and who is a brother-in-law not only of the Under-Secretary, but, I think I am right in saying, of the Postmaster-General as well. Therefore, here is this firm as closely connected as it is possible to be with the Under-Secretary. The firm is also, to a certain extent, closely connected with the Radical party. Lord Swaythling supports Lord Crewe in the other House; Sir Stuart Samuel supports the Government in this House. Added to that, there is a further connecting link, and that. is Sir Felix Schuster. He is chairman of the Finance Committee of the India Office, and also happens to be Messrs. Samuel Montagu and Company's banker or chairman of the bank, and therefore there is a connection there. Any one of these connections might not be very strong, but putting them all together it does make a case, at any rate strong

  1233
  enough. [An HON. MEMBER: "What case?"] [Another HON. MEMBER: "What about the Chamberlain family?"]
  Mr. SPEAKER: I must ask the hon. Gentleman to refrain from making a regular fire of questions during the whole of the speech. If he will restrain himself, he will have an opportunity of speaking later on. It is not fair to the hon. Member at the conclusion of every sentence to interrupt with cries of "Why?" "What case?" "When?" and so on. That is not the way to conduct debates in this House.
  Mr. GWYNNE: I do not think it can be said that the Under-Secretary has no more connection with the firm than he has with Messrs. Marshall and Snelgrove. I think the Noble Lord understated the case, and it would have been much better if he had frankly said in the other House that the connection was very close. It would have carried much more weight in the House than trying to deny it. Coming now to the question of the Bank of England, Mr. Franklin wrote to Sir F. Schuster on 9th January, 1912:—
  "Of course there would be no need for the Bank of England to be made acquainted with your purchases; they need only be told that they are to receive the silver against loans. This method would, I think, close every possibility of leakage."
  I should like to ask the India Office why was there this secrecy from the Bank of England, and why were there these elaborate plans to deceive them, because that is what it amounts to? Some bank had to be trusted. Why should the Union of London and Smiths Bank and its officials be trusted, and yet all these elaborate precautions be taken to deceive the Bank of England? What had they done? If they had divulged anything in the past, any secret, let the right hon. Gentleman say there was such, and I will take that as an excuse. So far as we know no complaint was made against them, yet we find this plot going on and all these contortions to avoid anyone in the Bank of England knowing anything about it. What has been the result of keeping this transaction from the Bank of England, apart front the fact that it created a want of confidence in the whole transaction? The direct result was that £661,000 of purchases had to be postponed because they did not want to place it in the Bank of England. They did not want the Bank of England to know what was going on, and that had to be done at a cost of £4,900. If there was a necessity, and it has been suggested by the Government that there
  1234
  was a necessity, that the silver should be bought from some other source, and that the same firm of bullion brokers should not be employed for this purpose as in the past, why could not the Bank of England have been taken into the confidence of the Secretary of State? Why did he not say to them, "We are afraid of this corner and of having the price forced up, and we want to change our tactics, and want to have it done through you."?
  Let me explain to the House why it was particularly desirable that if this purchase must be made it should have been made through the Bank of England, in order that you might have had some third or interested party. There have been suggestions in one place and in another, in the Press and in this House, as to whether Messrs. Samuel Montagu and Company acted as dealers as well as brokers, and they themselves in their correspondence resented the suggestion. The Under-Secretary told me here distinctly several times that they acted as brokers only. Now my opinion of the bullion market is that all the bullion brokers at times carry on transactions which are really, and would be more properly called, dealing transactions than they would be brokerage. In some of their transactions it is impossible to say whether they are acting as brokers or as dealers. Let me give you two examples of these transactions, and I could give a great many more. These two, I think, will show even to laymen that it was quite reasonable to suggest that the firm were acting as dealers as well as brokers. On the 25th June, 1912, Messrs. Montagu wrote to the India Office:—
  "We have debited you for to-morrow some silver coin, which will work out very favourably for you … If the coin should not be desired we will, of course, substitute silver bars with pleasure."
  Surely they were acting as dealers if they made a purchase, and then offered to substitute something else if that did not suit. That was a transaction of buyer and seller and could not properly be called brokerage. Take another case, on the 21st May, they wrote:—
  "We have purchased according to contracts enclosed £39,000 for delivery, 1st June. We have fixed the price at 1–32nd of a penny above cash price in order to compensate ourselves for loss of interest."
  It seems to me quite clear that they were acting as dealers if they had bought silver and then held it over for the India Office at a different price. I am not suggesting there is dishonesty or anything wrong in acting in that capacity because that is done in the bullion market, but what I do

  1235
  say is that it is all the more reason why you should have had a bank like the Bank of England, some third party, to watch these things and see that the firm were acting rightly between the buyer and seller, and if there is buying and selling of silver, such as is in these contracts, to see that the price paid is a right one. It is obvious that the fact that the Bank of England should not have been employed is an unfortunate thing about this transaction. When we asked this question and try to get out whether they were acting as brokers or dealers they quite resented it. Yet on the 13th November, 1912, Messrs. Montagu wrote to the India Office:—
  "While we would be glad to give you any information you ask, we regret that it is quite impossible for us to give the names of our clients from whom we purchase silver … Although your orders have been large, they formed at times but a portion of our business (which involves a considerable number of clients), and supposing we felt justified in divulging the names of those clients with whom we did business on the same days as with you it is no more practicable to disentangle from the list those which provide your silver than to identify the grape from which any given drop of wine had been obtained."
  If they cannot identify one seller from another it shows that they were acting as owners of that silver, and that is a statement which requires explanation. In face of that letter it is positively astounding to find that on the 24th of May before the investigations began, the India Office wrote to Messrs. Samuel Montagu and Company:—
  "As the time is approaching when you will be taking delivery of silver for us, I write to mention a point that has arisen in connection with our purchases in the past, viz., the marking. for purposes of identification of the seller, of bars or boxes of silver shipped for us. We have at times bought Mexican dollars, and among these counterfeits have been discovered on delivery at the Mints in India, in respect of which we have had occasion to claim refunds from the sellers … I suppose all bars or boxes will bear distinguishing marks which will enable them easily to be traced to the source of supply?"
  Messrs. Montagu wrote on the 26th May:—
  "All the bars we ship have identification marks and the same applies to our dollar boxes."
  If this is the case why was it that in November they were not able to distinguish one seller from another. Either one letter or the other was untrue. At any rate, it requires explanation. It was suggested by the Secretary of State in another place that this silver had been bought so well that hundreds of thousands of pounds were saved for the Government of India. That was the chief justification for having placed this contract with the firm in question. Obviously whether silver was bough well or not must be a matter of conjecture.
  1236
  It is a thing no one can say at the present time, or ever will be able to say, because the circumstances have not arisen. He is entitled to say that when the firm commenced purchasing in March the price of silver was 26 5–8ths, and that when they finished buying in October the price was roughly 29, the average price at which the whole £5,000,000 was bought being 28¼. Is it not fair comment to say that the Indian speculators, the people who made a corner in silver, could have bought the same quantity of silver without raising the price above 25? Does it look like an extraordinary deal on the part of Messrs. Montagu to have raised the price to nearly 29. It might well be remarked here that the order was given back to the Bank of England the day after I asked my first question in the House, and five days after I put it on the Paper. It may be a coincidence, but it is a curious thing, and the fact remains that they did go back. Since silver has been bought from the Bank of England the price of silver has not appreciably risen at all. The Government may possibly say, "Look at the way in which silver was run up in, former years." My answer is that in former years the Government bought very large quantities of silver. Those purchases were for a period of four years, and the orders were given in quite a different way. They had to buy at once. There was no buying forward for two months, and the silver had to be bought, so to speak, at forced sales. Even if we take the former purchases, if we are going to compare at all, we must compare like with like. The purchases began in 1904, and we find that in 1904, when the Government began buying, the price was raised 2d. Yet last year, when the Government placed the order, the price was raised very nearly 3d. When they talk about the hundreds of thousands of pounds they have saved, will the Government turn to Messrs. Montagu's own "Bullion Circular," in which they say that—
  "Silver is quoted at 29 1–8; much the highest price since October, 1907."
  Yet at that highest price they went and bought £600,000 worth, and the rest of the £2,000,000 was bought at just under 29, to be exact, 28⅞. I do not say that any other firm would have bought better, but it is not a good excuse to say that this transaction is fully justified merely because the silver was bought so cheap. Lord Crewe asked whether a firm of this standing was going to sell their souls for the mere sake of £7,500 commission? I do not

  1237
  suggest that the firm would sell their souls for any sum, nor do I suggest that the question of commission was of great import to them, but why were they so anxious to obtain this order if the commission was of no moment to them? Why did they go to these contortions and write these letters to obtain the order, if it was of no moment to them to have it. I do not suppose they suggest that they were acting merely as philanthropists towards the India Office in this matter. They were doing it as a matter of business, because they knew that the knowledge of Government purchases was of the greatest value. The knowledge of that fact would be of the same use to any firm which carries on business in the same market as Messrs. Samuel Montagu themselves. It is perfectly clear to my mind that Messrs. Montagu were told at the start that they were to buy at least £2,000,000 of silver, for they wrote this letter on the 5th of July to the India Office:—
  "We have to-day bought for you £12,000 silver thus completing your last order of £250,000. We enclose contract.
  "Having now purchased for you the whole £2,000,000 that was suggested when first you gave us au order, we take the opportunity of saying how much we appreciate the confidence that you have placed in us in giving us so much freedom in carrying on the business."
  The India Office then wrote back:—
  "I am directed to acknowledge the receipt of your letter of the 5th instant, reporting the completion of the purchase of silver to the value of £2,000,000 on behalf of the Secretary of State for India in Council. In reply, I am to convey to you his Lordships cordial thanks for the satisfactory manner in which you have carried out the transaction and the secrecy which has been observed."
  When I asked in this House when that information was given, the answer I got was:—
  "No such information was given to the firm either in writing or orally. The reference in the firm's letter of 5th July appears to have been made under a misapprehension."
  Why was it not contradicted at the time. They wrote and acknowledged the letter, yet when we used it for the purpose of showing that they knew in advance that large purchases were going to be made, the India Office turned round and denied it. The value of it is this: That without knowing how much was going to be bought, the very fact of knowing that the Government were going to buy told these people that the price of silver would not go down, but would very likely go up. To have a certain knowledge that silver would not go down was of itself of great value to anyone in the silver market, because the silver market fluctuates quickly and greatly. They had the certain knowledge that for
  1238
  the next six or eight months silver would not go down, which was of enormous value, and it carried with it the strong probability that it would go up, which is of great value. It would affect not only the silver market, but many other interests in which a firm dealing in silver are concerned, such as silver securities and so forth. It may be fairly said that someone must have this knowledge and this advantage. I quite agree. But I think that the best traditions of English public life make it quite clear that whoever is to gain the advantage, the people to gain it should not be relations of Ministers.
  There is another point. If this business was to be given to the firm in question, the House is entitled to say, and I believe Members on both sides will agree would say, that provided the order was given—I do not think it was right that it should be given—the greatest care should have been exercised in carrying out the transaction in the most businesslike way possible. Instead of that, I do not think it is unfair comment to say that it was carried out in a loose way, in a way which no limited company would stand if taken by their officers. The whole question of brokerage fees is an important matter. It was arranged verbally, and not confirmed in writing until after the order for the first £500,000 had been given. When I noticed the transaction of May 21st, I asked what sum was being paid, the cash prices and the date. I was told that it was a verbal arrangement; that they could not trace the date, and that it was either the 20th or 21st May. I was afterwards told that it was arranged on the telephone, and that no record was kept. I asked—
  "Does not the India Office think it necessary to keep a careful note of all conversations, telephone messages, and interviews, relating to business transactions, in case of dispute afterwards?
  "Mr. H. Baker: No."
  Even gentlemen on the Turf, who carry on their transactions in rather a loose way, take the trouble to write them down in a note book. I am sorry, for a good many reasons, that a careful note of all these transactions was not taken, for we might have got some more literary productions of the same fantastic nature as that of 8th January which would have been amusing reading, if nothing more. For a Government Department to carry on business like this without any note of conversations or arrangements in matters dealing with millions of pounds is unbusinesslike. Supposing anything had happened to the parties who were

  1239
  carrying on these conversations; suppose Sir Felix Schuster had been taken ill, and a dispute had arisen, how should we have found out what really took place at the conversations? It would be a matter of conflicting evidence, or, perhaps, of no evidence at all. Would any firm carry on its business in this way? One of the worst complaints we have against the Government with regard to this matter is the slack, careless way in which it was carried out. It is not as if it was carried out by two parties. We have a big firm on the one side, consisting of several persons, and on the other side the India Office. Sometimes the letters were written by Sir Felix Schuster, sometimes by Mr. Abrahams, at others times by Mr. Robinson, Mr. Badock, Mr. Jacquet, and Mr. Newmarch. The same parties appear to have written letters, and to have had telephone communications and verbal interviews, and yet no note was kept. It is impossible to conceive anything more unbusinesslike than this transaction. If, as Lord Crewe said, this order was given to the firm because it was only temporary, and in order to get over a difficulty and obtain secrecy, why was not the work transferred to the Bank of England until it was disclosed in this House. It was public knowledge. All the world knew, and the money market knew in August that the Government were buying through Messrs. Montagu. Their own circular of 22nd August states that the Government had been shipping £750,000 worth of silver, yet after that circular was issued, and after the Indian Mint began coining it, orders were still given to the firm. It could not have then secured secrecy. It is fair comment to say that it was only after we had dragged the matter out in the House that. the orders went back to the proper channel, the Bank of England. The most remarkable statement made in regard to this contract was the statement of the Prime Minister on 12th December, in answer to the Leader of the Opposition. He said:—
  "I cannot accept for a moment that there is anything unusual. On the contrary, in all essentials, the transaction, so far as I am aware, has been in strict conformity with the practice of the present and previous Administration."
  The Prime Minister is entitled to speak for his own Administration, but certainly not for Administrations formed from this side of the House, if he suggests that anything of that sort went on. It is certainly a new style in Government Depart-
  1240
  mental work, which we on this side of the House do not wish to copy. The whole question of this contract requires a great deal of explanation. We have only to refer to the utterances of the present Chancellor of the Exchequer, the present Lord Chancellor and other prominent Members of the Radical party who a few years ago sat on this side of the House, when they indignantly attacked this party because certain Members of it were interested or had shares in limited companies which held Government contracts. The present Chancellor of the Exchequer used strong language, as he generally does, in expressing himself. He said that in these matters they should be like Cæsar's wife, above suspicion. He went on to say:—
  "When once these rules are broken by any person in high position, it leads to the complete demoralisation of the whole Civil Service. It is setting a dangerous precedent."
  If the Government had frankly admitted in this House that there had been a mistake, if they had given us an opportunity of discussing it in the House, and had taken the opportunity of explaining it in the House at an earlier period, they would not only have been in a much stronger position themselves, but they would have saved much discomfort and disquietude in India.
  There is only one other point in regard to my Motion, and that is in regard to the cash balances. That is a more lasting question than the question of the contract, and therefore is, in its way, more important. That the balances at present, or latterly, have been far too large, must, I think, be admitted on all sides of the House. When we consider that during the last two years we have had at times as much as £45,000,000 of Indian money in this country entirely at the discretion of the Secretary of State, it must be admitted that that is a matter which requires investigation, because any system which allows balances to be accumulated to that extent should at any rate be revised, and so far as the cash balances themselves are concerned, we see that they have been gradually growing. I doubt whether there is another part of our Empire which would tolerate the keeping of £45,000,000 of their money over here, and handling it entirely as one or two men in the City think proper. The cash balances have been quickly growing. In 1908 they were £5,000,000; in 1909, £10,000,000; in 1910, £16,000,000; 1911–12, £19,000,000. The amount is excessive, and the rate of interest is small. I do not say that the

  1241
  rate of interest was smaller than should have been obtained, but at any rate it was not sufficient to justify these large balances. Whatever rates could have been got, I do not think balances to such an extent should have been kept here. With regard to the employment of these balances, I cannot help feeling that it is unfortunate that they should have been deposited so largely with banks whose governors are so directly connected with the India Council. We have been told that that question has been separately considered and approved by the Secretary of State. I have no doubt the Secretary of State had a good reason for coming to that decision. At any rate, I think it regrettable that so large a sum as £3,000,000 last year should have been deposited with one bank—London Union and Smiths—whose chairman is Chairman of the Finance Committee. I do not say that as much interest was not given as if it had been employed at another bank, but this kind of thing gives a feeling of suspicion and uneasiness, both here and in India, and I think the Secretary of State would have been wiser if he had said these members of the Finance Committee would please him much better if they did not lend sums to banks with which they are directly connected.
  As far as the approved borrowers go, I quite recognise that there is a long list. I do not wish to make an unfair attack on Messrs. Montagu in this matter, but let us remember that these balances have largely increased, and that the amounts lent to various firms have been increased, and what may at one time be a use, if multiplied by eight or ten, becomes an abuse; and it is again regrettable that that particular firm, bearing in mind its close connection with the Government, should for two years have been the largest borrowers on the approved list. I do not think we can be too careful in regard to the management and manipulation of Indian money. We must remember that the people of India have no direct representative in this country. They have no one to look after their interests except the Secretary of State, and even those of us who take an interest in Indian affairs very seldom have an opportunity of raising them in this House. Lord Curzon the other day, in referring to the power which the Secretary of State wields over these finances, said that he is almost omnipotent. He is a financial autocrat. Surely, if that is the case—and Lord Curzon ought to know with his experience in that country—it is only
  1242
  right that he should see that that patronage and the power of dealing with these vast sums should be placed in the hands of men who have no interests which may be antagonistic to the interests of India. No one doubts for a moment the ability or the honesty of the members of the Finance Committee, but no one can deny that Sir Felix Schuster and others have interests, and are engaged in other undertakings which, at times, may not be strictly the same interests as those of India. They have large interests in the money market of the City of London. It does not follow that what is good for the money market here is good for India. Those interests may be brought into conflict, and although they may wish in every way to subordinate their own interests for the good of India, yet there are times at any rate which may give grounds for suspicion that that will not be the case. In order to show that this is not merely an idea which exists on this side of the House, but is felt very strongly in India, I should like to read a short quotation from the "Times" of India, a paper which I think carries great weight in that country, and is looked upon generally as an impartial organ:—
  "No definite personal distrust has been created during the discussion. But it cannot be denied that an uncomfortable feeling has arisen around operations which the public should have no possible excuse for contemplating otherwise than with absolute confidence Honourable men may always be trusted, when performing a public duty, to resist the influence of their professional or financial environment. All the same, it is not a politic thing, to say the least, to put men even of invulnerable integrity in a position in which they may have to decide between two interests, one of them much closer to them than the other. To put it more directly, no one whose interest is associated with the London money market should have a determining, or even an influential, voice when a decision has to be taken between the financial interests of India and those of the city."
  That conveys very fairly the feeling which is held in regard to this matter in India, and I feel that the Government will be acting in their own interests, as well as in the interests of this country and India, if they grant a Select Committee to inquire into these two matters and generally into the question of Indian finance. There is a precedent for demanding a Select Committee to inquire into such a thing as this, because I see that Mr. Gladstone in 1871 moved for a Select Committee to inquire into the financial administration of India. That Committee was appointed, and I hope the Prime Minister will see his way to follow that precedent.
  Captain CRAIG: I beg to second the Motion.
  The FINANCIAL SECRETARY to the WAR OFFICE (Mr. Harold Baker): The hon. Member covered, in the course of his speech, a great variety of transactions, and I listened to him with considerable curiosity, as I imagine many other Members of the House did. For three months past he has conducted a campaign through the medium of questions investigating the particular problem to which he has referred. He began that series of questions in a very proper spirit, with a very natural demand for information upon a certain point which seemed to call for inquiries, but he did undoubtedly, before the end, degenerate into a state of mind which, I am sorry to say, it is clear from his speech this afternoon still prevails, and in which he regarded a number of transactions, the facts of which have been completely exposed and made clear to him, still with the same attitude of suspicion as at the beginning. He ended his speech by saying that no doubt all these matters were perfectly correct, and no objection could be taken to them, but that still they gave grounds for suspicion. He ended by saying in so many words that he did not doubt the honesty of one single person whose name had been mentioned in connection with this affair, but still at the same time there was very good reason for suspecting everybody. I propose, as far as I can, to go through the various points which he has mentioned, and deal with them one by one; and I think before I have finished I shall have shown to the satisfaction of the House that though there may be grounds for suspicion in the mind of a person who is temperamentally inclined in that way at the beginning, that when the facts are fully explained no one with any honesty or impartiality in his mind can say there is a shred of justification for suspicion at the end.
  The hon. Member began by accusing the India Office of having pursued a consistent course of prevarication in giving answers to the questions which he had put. I will take that at the beginning, because, though personally I am considerably touched by that charge, I have equal confidence that in the face of that charge I can show that he had no justification whatever for anything of the sort. I really find it difficult to know what the hon. Member was referring to when he said that information had not been freely given to him at his demand. What is it that he means? I know quite well that his Leader used the phrase "drawing teeth." It was
  1244
  a phrase which my right hon. Friend at the time, very properly, objected to very strongly, because either it is a phrase which might apply equally well to all questions addressed to any Minister or it is one which carries with it some meaning which has no connection with the matter in hand. What are the facts? I will mention some of the most important items—I am sorry it is necessary to do this—I wish it had not been necessary—on which the hon. Member has asked for information, and we will see what happened. On 29th October he asked for a very important piece of information—the names of those who were on the list of approved borrowers. It was a breach of confidence that those names should be disclosed at all. Such a thing has never been done in any single case probably in the history of the Money Market, but simply and solely so that the India Office should show that they had nothing to conceal from the very beginning, and that the hon. Member in his inquiries should not be able to say he had been met by a refusal, I gave him on the spot, without any hesitation at all, an absolute promise that he should have those names. Then in the ordinary course he repeated his question a few days later, and, when the question was repeated, at once he was given the list of approved borrowers.
  Mr. GWYNNE: I made no charge against the India Office of having suppressed information in regard to cash balances. I said my charge against the India Office was of prevarication in regard to the silver purchases.
  5.0 P.M.
  Mr. BAKER: I am very glad to hear that the hon. Member has withdrawn, at any rate, that charge. It is very difficult to know what charge he is persisting in. At any rate, in bringing it forward, I think it was not irrelevant, considering that a general charge of prevarication
  might be preferred, to show that the India Office had not, even on the point of the cash balances, withheld any information for which they had been asked at any stage of the proceedings without very good reasons. The hon. Member confines his charge of prevarication and withholding of knowledge to the silver question. On that very same day, 29th October, he asked a question which was quite as important in connection with the whole discussion, namely, what were the names of the firms

  1245
  or agencies through which the India Office purchased silver, and at once, without delay or prevarication, I told him it was the firm of Messrs. Samuel Montagu and Company. On 19th November, it is quite true, he asked the names of those who had sold silver to Messrs. Samuel Montagu and Company. That was refused, because the practice of the bullion market is not to give the Secretary of State the names of those who sell silver, either when purchases have been made by the brokers employed by the Bank of England, or now when they have been made through Messrs. Samuel Montagu and Company. The only relevancy of that question is as to whether Messrs. Samuel Montagu and Company acted as brokers or dealers in these transactions. I shall deal with that satisfactorily, I think, before I sit down.
  Then the hon. Gentleman laid great stress on the fact that the correspondence had not been given to him exactly as he asked for it. I think if he will look fairly at the questions put and the answers given at the time, he will see that is not strictly so. He asked on 14th November for the contract between Messrs. Samuel Montagu and Company and the India Office in respect of silver, and the terms on which they were instructed to purchase. That information was given to him in full that day. Having asked for the terms of the contract, he asked in a supplementary question for a copy of the correspondence which it was impossible to give then, but it was given at the first possible moment. He returned to that question—originally a supplementary question—on 22nd November, and then he got the information, with certain exceptions which were specified to him at the time. I really was astonished in the course of his speech at his alleging that there had been some correspondence withheld at the time, though it was said to be complete, whereas by his own ingenuity he had discovered that it was not complete. He was assured at the time that it was not complete, and that certain excoptions had been made. On 27th November he specified two particular letters which were omitted. One of these was non-existent. It was a letter which existed only in the imagination of the hon. Member. The other letter was one of a perfectly trivial description, and it was given to him. On 27th November he asked for these letters. He was quite well aware on 22nd November that exceptions had been specified. He was
  1246
  told that if he wanted them he should have them. Then he said that, after all, the most important thing was the letter of 8th January, 1912—the letter on which he based such a large part of his speech. All I have to say to the hon. Member in connection with the withholding of that letter at the beginning, is that, as the White Paper shows, and as indeed the phraseology of the letter itself shows, it was purely a private letter, that it was not part of the contract between the India Office and Messrs. Samuel Montagu and Company, and that it was in no sense an official letter at all. In spite of that, it was given to him, and it is printed in the White Paper, and the hon. Member has made such use of it as he could to-day.
  I wish to turn to that letter, and I will reply specifically to each point he raised, but before I come to that—inasmuch as this letter of 8th January, 1912, is really preliminary to the actual contract, and as the hon. Member, who, I think, showed a very proper desire to save time because it was not germane to the purpose, did not describe all the attendant circumstances and state the exact reason why the Government of India approached Messrs. Samuel Montagu and Company—I think I must in a few words explain to the House how matters stood. The India Office does not purchase silver in every year. It only has to purchase silver when it requires it for replenishing its reserves of rupees when it finds that its reserves of rupees are sinking, and that it may be necessary to coin rupees. It was thought they might have to coin in 1910. There was a possibility in 1911 that they might have to do so, and that possibility became a probability in 1912. All forecasts in these matters are always difficult at the India Office. But in 1912, it became quite evident to those who brought experienced minds to bear on this matter that coinage would have to take place in the course of the year. The test which the India Office applies is that on 1st October they should have £16,000,000 of rupees—that is twenty-four crores—in the reserves. It is not always easy to apply that rule, because while coinage may appear to be necessary, still they cannot be sure that in the course of the next few months there may not be a great influx of rupees, which will avoid the necessity for it. At any rate, in the middle of February, 1912, they knew that they were six crores short of the total rupees they considered necessary that they should hold in reserve.
  The PRIME MINISTER: That is the Government of India?
  Mr. BAKER: Yes; the Government of India were then aware, although not certain of the exact amount, that coinage would be necessary. It seemed to them probable that some purchase of silver would be necessary. The Secretary of State, of course, was informed of these facts, and he had to consider very carefully the question of buying silver. The purchase of silver had not been performed for several years, and the situation had changed a good deal since the last time that it was bought. He had to take account of three special difficulties, some of which confronted his predecessors, but not all. He had to consider, first of all, that there were large fluctuations in the price of silver. In the ten years, 1902 to 1911, silver varied in price between 24⅛d. and 30⅞d. per standard troy ounce—a change of 27 per cent. The Secretary of State had to consider that. He also had to consider that there were very strong reasons for believing that silver was being held up by speculators, both in Bombay and in London, in anticipation of purchases by the India Office. The hon. Member said that was a fantastic supposition. Fantastic was the word he used and he said there was no ground for it. He said that there was no corner: but these are, after all, matters of degree. It is quite sufficient if the Secretary of State had—and there is plenty of documentary evidence to show he had—adequate ground for believing that silver might be held up against the Indian Government in a way which might increase the price against him. He felt that he would be perfectly justified in considering whether some other course could not be adopted. As to the holding up of silver by speculators in order to raise the price against the Secretary of State in case he came into the market, there is overwhelming evidence, and it is quite impossible to deny it. That was very much operative in the mind of the Secretary of State. Then he had to consider another factor of very great importance, namely, that the silver market itself is an extremely limited one. There are, all told, not more than four firms engaged in the silver bullion market. They are Messrs. Sharps and Wilkins; Messrs. Pixley and Abell, Messrs. Mocatta and Goldsmid, and Messrs. Samuel Montagu and Company; and if silver was to be purchased it had to be purchased,
  1248
  whoever was employed as the intermediary, through one of these four firms. That was the state of affairs, and, as the hon. Member informed the House quite truly, the purchases made by the Indian Government had formerly been made through the Bank of England. The Bank of England had invariably employed either Messrs. Mocatta and Goldsmid or Messrs. Sharps and Wilkins. Secrecy was of the utmost importance. It was of the essence of the whole transaction. If the manœuvres of the speculators were to be defeated. it was perfectly necessary to adopt some method of preventing from knowing that the Secretary of State was coming into the market to purchase silver for the purpose of coinage. If the Secretary of State had in that dilemma carried out the previous practice and gone to the Bank of England, who would have employed one of these two firms, that would have been advertising the fact that the Secretary of State was purchasing silver, and the price would undoubtedly have been raised. It is almost a matter of common knowledge—I do not think it is denied—that one, if not two of the firms were acting for the speculators who were holding up silver against the Secretary of State. It may be said, "Why not go to the Bank of England and allow them to employ, as intermediaries, Messrs. Samuel Montagu and Company?" That was impossible. The Bank of England had already on the 10th February informed the Secretary of State that they had entered into an arrangement with the two firms of Messrs. Mocatta and Goldsmid, and Messrs. Sharps and Wilkins, by which they would much prefer to buy silver only through them. That arrangement was to continue up to 31st March in this year. There remained only two firms through which the Secretary of State could act, namely, Messrs. Samuel Montagu and Company, and Messrs. Pixley and Abell. I understand that Messrs. Pixley and Abell is a firm of very high standing indeed, but it is a firm whose operations are carried on on a smaller scale than those of Messrs. Samuel Montagu and Company, and as it was possible that a very extensive purchase of silver might be required, the Secretary of State decided that, though the standing and reputation of the two firms were equal, it was his duty to choose Messrs. Samuel Montagu and Company,
  That is a very short summary, and I am afraid it is no more, of the circumstances under which the Secretary of State came to choose the firm of Messrs. Samuel

  1249
  Montagu and Company for this purpose. The hon. Member, when referring to the letter of 8th January, made a good deal of superficial play about the exact operations by which the contract was formed, and the precise negotiations entered into between Messrs. Samuel Montagu and Company and their representatives and the India Office itself. I will now turn to the letter of 8th January. I may say, parenthetically, that the hon. Member adopted the method which he adopted previously at Question Time of paraphrasing words used in a letter and putting a meaning on them which they do not bear and drawing an inference which is not justified. He said that he would read the letter through. He read it through and said he would not be content with that. I knew it, and that he would not be content unless he went on to alter the phrasing to find some foundation for his allegations. He began by quoting a passage by which Messrs. Samuel Montagu and Company say—
  "it appears to us that the time is not far distant when it will be considered prudent for them (the Indian Treasury) to strengthen themselves by coining rupees."
  He asked how had they any such, knowledge. The necessity had not then arisen. It did not arise until August, 1912. I would go too far in wasting the time of the House in explaining the position which the hon. Member tried to maintain that by using these words "the time is not far distant" they are contradicting something which he alleges was the case in January, 1912. The time was not far distant. It did arrive, but not in January, 1912. He then went on to read:—
  "If, therefore, you postpone your purchases until you are absolutely pressed for currency, the chances are that you will have no other supply available beyond that that is being nursed for you by Indian speculators."
  I agree that perhaps it was a rather extravagant statement on the part of Messrs. Montagu to say that there would be no other supply, and that perhaps that would be putting it too high, but it is unfair to take these words written before a contract was made by a business firm and then to say it was misleading. The fact was that there was, if not a complete corner in silver, at any rate a very considerable holding by speculators. I think that that is something which could not have been misunderstood and certainly was not misunderstood by anybody except the hon. Member who draws attention to it to-day. Then he went on:—
  "We receive consignments from special clients of our own of silver peculiarly adapted to coinage purposes,
  1250
  averaging about £50,000 per week, which we have to sell at the market prices."
  There the hon. Member surprised me, because, if anything, I thought he was a very close student of this correspondence, and he said, "What on earth is the meaning of that? Of course there is only one quality; it must be the right quality." If he had looked at the letter further on in this same White Paper he would have found the statement made—
  "We have at times bought Mexican dollars, and among these counterfeits have been discovered on delivery at the Mints in India, in respect of which we have had occasion to claim refunds from the sellers. The authorities in India have also found fault with, and asked not to be supplied with, certain sorts of bars, viz., Raritan bars and 'D.R.W.' bars. In view of the contingency of any faults being found with silver shipped for us, I suppose all bars or boxes will bear distinguishing marks which will enable them easily to be traced to the source of supply."
  That is a fortunate illustration ready to my hand. It shows that those who purchase silver have to be very careful about the grade and quality of silver, and it was a very proper phrase to put in a letter of this kind. Then he draws attention to the passage in which Messrs. Samuel Montagu and Company say, "No one would have the remotest idea that you are buying." The hon. Member said. "How unfair. You are going to conceal from the other people that the Secretary of State is the person who is buying." Why no one enters into a transaction of this nature and gives this information. You never know who is buying and selling. The transaction is conducted by a broker, and neither party has the faintest idea of the identity of the other. It would be not only against public interests, but would have been a gross breach of all custom if in this case the identity of the Secretary of State had been allowed to leak out.
  Mr. GWYNNE: The hon. Gentleman is either misquoting me or has misunderstood me. What I said was it would be unfair to say that they were keeping down the market price of silver and at the same time acting fairly for those people for whom they were selling. In keeping down the market price of silver they were not acting in the best interests of those for whom they were selling.
  Mr. BAKER: Surely the hon. Member will see that they are only keeping down the price of silver by concealing a fact which is always concealed, and the existence of this condition is normal instead of being, as the hon. Member would seem

  1251
  to imply, abnormal. He also read the passage in which they said—
  "We particularly do not care about approaching Edwin Montagu on this matter for reasons which must be obvious to you."
  I can only say in reference to that what everyone can understand that no one regrets more sincerely than I do that the hon. Member (Mr. Montagu) is unable to be here to make the defence which, I am sure, he could make with complete propriety to the case made in this House this afternoon. Then the hon. Member quoted the following letter of the 9th January, and said why should there be secrecy against the Bank of England? There, again, I must apologise to the House for detaining them when no explanation whatever is necessary. The letter quite clearly does not imply that the Bank of England is not to have knowledge, but the point is that other people should not know that silver was deposited on behalf of the Secretary of State. The hon. Member then went on to ask why Messrs. Samuel Montagu and Company could not have been employed through the Bank of England. I have already dealt with that point, and shown that the hands of the Bank of England were tied by their own voluntary agreement with the other firms, so that they were quite unable to employ Messrs. Samuel Montagu and Company if they wished, or, at any rate, they had a moral obligation to have recourse to the other two firms.
  I pass on to those matters which the hon. Gentleman raises with regard to the actual execution of this contract. I confess I did think that he would drop the allegation in which he persisted this afternoon that Messrs. Samuel Montagu and Company had been acting not as brokers for the Secretary of State in this transaction, but actually as dealers. I think, in fairness to Samuel Montagu and Company, that I ought to say a word on this. We would really seem, from the hon. Member's speech, to be considering this afternoon the administration of Samuel Montagu and Company rather than the administration of the India Office itself. What are the facts? Samuel Montagu and Company were instructed definitely to buy on behalf of the Secretary of State, and the same thing appeared on the contract notes which have been exhibited, and which show that they bought on behalf of the Secretary of State. They definitely
  1252
  state that they were acting as brokers. The hon. Member asks why the names of the sellers were not disclosed. They never have been disclosed in such a case, and the three other firms, competitors, as they must be of Samuel Montagu and Company, in this matter have put in writing that it would be a breach of confidence if it were done in this particular instance. The very moment that this question was raised by the hon. Member in this House as to whether Samuel Montagu and Company had acted as brokers or dealers, they offered their books to the Secretary of State for his inspection, and the Secretary of State had a full opportunity to investigate them if he had so chosen. He did not accept it, but in order to defeat suspicion he reserved the right to do so at any time in future if he thought it necessary. The Secretary of State has full confidence in this firm which had relations with the India Office ever since 1887, and nothing has occurred in the House or elsewhere which has made it necessary for him to subject them to the indignity of a search of this description.
  When the Select Committee sat dealing with the case of the seat of the hon. Member for Whitechapel, there was one special instance of a sale and the name of the seller which was raised, and without any consideration of difficulty it was handed to the Committee by the representative of Samuel Montagu and Company. I will only add one point as to that. The hon. Member has attached a great deal of importance to this question as to whether Samuel Montagu and Company acted as brokers or dealers, and also said that the India Office should have acted through the Bank of England. If the Bank of England had been employed, how were they going to prevent that? How were they going to prevent Samuel Montagu and Company acting as dealers and not as brokers? What difference would it have made? Nothing of any sort has been produced to lead the mind of any man whose mind is not perverted by suspicion to imagine that Samuel Montagu and Company did anything but what was regular. The hon. Member referred to the question of postponing delivery, and suggested that a great deal of additional cost had been incurred. The reason for postponement was very simple. The purchasing of silver began in March The contracts were for forward delivery—usually at two months—as they always are when silver is not yet required. The

  1253
  delivery of a very large amount was postponed, the total being no less than £660,000, and an extra brokerage was entailed, and there was additional cost. Against that you have to set again the interest which accrued to the India Office from the later payment of the money and also, and most important of all, and what was the governing motive in the mind of the Secretary of State at the time, secrecy was maintained, and the price was prevented from rising against them. I do not think that the hon. Member really can claim to make any capital out of that matter. It was part of a deliberately arranged policy of secrecy between the Secretary of State and the other parties in order to secure that the India Office should get the silver at the cheapest price possible.
  Then as to identification marks. Again I must apologise to the House for going into an explanation which is elementary to those who are acquainted with the practice of the bullion market, but the hon. Member did so misrepresent the facts that really I am compelled to give this explanation to the House. The hon. Member has alleged that I have given a false answer to a question on that point. On the same day one of these brokers on the bullion market buys silver from a selling client who wants to sell it—sells it to a buying client who wants to have it. Those two operations are two sides of the same transaction, but in due course, in many cases two months afterwards, and not on that day, the seller delivers to the buying firm silver which is of a specified weight and quality. No buyer in the bullion market ever buys certain specific bars a, b, and c. They buy silver of a certain weight and quality, and nothing else. The bars delivered eventually are not necessarily the bars which were bought at the time under any contract for brokerage. Then when the buyer comes at a later day to receive on such a contract, there is no means of knowing that he gets these bars—a, b, and c. The broker cannot say. No broker who ever operated in the silver market could do so. It would be quite impossible. He cannot possibly allocate them to a particular contract made on behalf of the particular buyer. He can, of course, place the actual sellers of these bars. That is the whole point and purpose of the identification marks themselves. The effect is that Samuel Montagu and Company could not possibly show that against each particular contract, and
  1254
  there were a great number, with the India Office they had also a specific contract with a seller for the particular bars delivered. That is not the way in which the operation is carried on. All they can show is, when the due date arrives, that the bars are of the requisite quality asked for. I hope hon. Members will recollect the explanation given by the hon. Gentleman on that subject, and will compare it with mine and observe the differences which appear.
  I now pass to his next point, and that was whether there had been a saving or not by purchasing through Samuel Montagu and Company. The hon. Member said it was a matter of conjecture. I am afraid it must be. I remember a story about somebody who, having gone into a certain examination, had a proposition in Euclid to do, but he was not sure that he had succeeded in proving it, though he said he had made it extremely probable. I can make it appear extremely probable that there was a great saving by purchasing through Samuel Montagu and Company. You have the price of silver, you have the restricted market, four brokers only, and you have also the question of speculation for a rise. I am going to put this question to the best test there is—I do not say it is very good, because it is impossible that the result can be more than conjectural; I give it for what it is worth. The first purchase of silver was on the 4th March; the first actual shipment did not take place until the 9th August. The first suggestion that the Secretary of State was a purchaser at all was on the 9th August. That was in the bullion circular of Messrs. Mocatta and Goldsmidt. This appeared in print on the 9th August, and I think we may fairly assume that the rumour that the Secretary of State was purchasing existed on the 7th August. The price of silver on the 7th August was 27 11–16ths. Ten days later, after that rumour first began to spread, on the 17th August, the price was 29 1–8th. It was the rumour which sent it up.
  There may have been other factors to be taken into consideration, but here you have the fact that after this rumour the price rose above what it was during the five months' period of secrecy; and if there could be such a rise in consequence of the rumour, the House may judge what must have been the saving in the period of secrecy. It must have been a very large sum indeed. Taking all the purchases made up to the 9th August, the date up to

  1255
  which secrecy was maintained, the purchases up to that point were made at the price of 27 3–8ths. Taking the period from the 9th August to the 24th September, which may fairly be called the period of suspicion when there was considerable suspicion about the Secretary of State's purchases, the price during that period was 28 3–4ths. After 24th September, when it was known that the Government were purchasing, and in the later purchases made from November up to January through the Bank of England, the purchases were made at the cost of 29 3–16ths. There you have three periods—the period of secrecy, the period of suspicion, and the period of certainty. In the period of secrecy the price was 27 3–8ths; in the period of suspicion it was 28 3–4ths; in the period of certainty it was 29 3–16ths. [An HON. MEMBER: "The hon. Gentleman has made a mistake in his figures, because on the White Paper the price is given at 28 1–8th."] I have given the average prices. If anyone has any doubt on this subject I may mention that other people concerned in the market have admitted that the Secretary of State, by the method he adopted, succeeded in keeping the price low, and in bringing about a considerable gain to the India Office.
  Mr. BONAR LAW: What other people admitted it?
  Mr. BAKER: If the right hon. Gentleman wants to know the name, it was Messrs. Mocatta and Goldsmidt. If you take the figures I have given over the periods stated, I estimate that we have effected a saving in connection with the purchases of silver of £175,000, and anybody able to judge probably may give good reasons for stating that the amount was very much more than that. Now I come to a point somewhat personal to the hon. Member, and I am very sorry to have to dispel an illusion under which I fear he is labouring. He said that our return to the Bank of England was caused by the questions put to me in this House. The hon. Member said there is no complaint as to the Bank of England, but I would like to point out what is very much overlooked, that when you go to the Bank of England in order to purchase silver, you have to pay them a commission, in addition to the ordinary commission, on the purchases. Although there is no reason to complain, from the year 1900 the Bank of England received the sum of
  1256
  £34,700 by way of extra commission from the India Office, an outlay which would have been avoided in purchases made direct through brokers. Although we have no reason to complain of the Bank of England as to the way they have done the work, it is a more costly proceeding to purchase through the Bank of England. An extravagant Conservative Government from 1900 to 1906 paid £1,250 over and above the ordinary brokers percentage on each million of silver purchased. But when the present Government came into power one of the first acts in 1906 was to reduce these extravagant and excessive terms of the Bank of England to one-eighth on the first £2,000,000, instead of one-eighth on all the purchases. Negotiations are in progress by which we hope with great confidence that the amount given to the bank employed will be considerably reduced. The hon. Member suggested that it was in panic, in consequence of public exposure, that the India Office had given up their friends and deserted Samuel Montagu and Company and rushed back to the Bank of England in order to resume transactions through them. What is the fact? From the first Samuel Montagu and Company were told that these transactions were to be of a temporary and exceptional nature, and that there was no hope of their continuance. It was stated to a member of the firm, who told the Select Committee that they understood it was a temporary measure, and that was confirmed by Lord Swaythling in the House of Lords.
  The hon. Member apparently suspects everybody, but it so happens that there is a record in the India Office dated 15th October—before the hon. Member put a single question in this House to me—which says that the need of secrecy is withdrawn. It was then thought that further purchases possibly might not be required. That was on 15th October, but on the 18th the Government of India telegraphed that they would require another £1,000,000 worth of silver. Mark the dates. On 24th October the Secretary of State received a letter from the Bank of England, in which they claimed that under certain correspondence which passed in the year 1906 they had an exclusive right to these transactions, and that it was a breach of that agreement to employ Samuel Montagu and Company at all. It was quite evident to anybody, whether they have a legal mind or not, that on the correspondence they had no such right at

  1257
  all, but the Secretary of State was informed by Lord Inchcape that a collateral agreement to that effect had been made orally. The Secretary of State accepted that, and decided to carry out that engagement, which existed up to the 31st March, 1913. That was on 24th October. Actually that letter arrived on the same day on which the first question was put upon the Order Paper by the hon. Member as to these matters. The hon. Member put a question as to through what firms purchases had been made. That was answered on the 29th. On the 30th October, £1,000,000 of silver was ordered to be purchased through the Bank of England. If hon. Members will look fairly at these dates, they will see that it became necessary that the Secretary of State, in accordance with the agreement, should go back to the Bank of England in order to carry out the small purchases of silver through them, and not through Samuel Montagu and Company.
  The hon. Member next made a great point as to the internal maladministration of the India Office. The fact is that the brokerage charges made by Samuel Montagu and Company were arranged in a conference. It is quite true that the actual figure does not appear in the first letter, and only appears in a later one, but the later letter refers back to the oral arrangement which was made; and more than that, the brokerage amount was an amount which could not have been varied in any possible particular; it was the brokerage always charged on every transaction in the silver bullion market. It was because the charge was so normal, so certain, and so inevitable, that, by an oversight, it was omitted from the first letter, and put only into the second letter. From the beginning there never could have been any variation in the rate of brokerage, and the hon. Member can make no point of the fact that by a mere oversight it was omitted from the first letter. I have dealt with all the questions raised by the hon. Member, but, before concluding, I wish to make allusion to a second subject, one rather apart—I mean the question of the list of approved borrowers. There is no need to go into that in any considerable detail, but the hon. Member did suggest even there that the amounts of the balances lent to borrowers had increased so much that Samuel Montagu and Company profited in some way from those increased amounts.
  1258
  I think I can confute that plea. If you take the years 1900 to 1906, you will find that taking the maximum of those loans to borrowers held on any one day, Messrs. Samuel Montagu and Company's proportion of the whole amount was 9.5. If you take the later years, when the Liberal Government was in power, from that time onwards you will find that that has only increased to 9.66. The hon. Gentleman is welcome to the difference between 9.5 and 9.66. Those figures are quite correct, and I think they prove conclusively that no unfair advantage has accrued to Messrs. Samuel Montagu and Company under the Liberal Government. I regret I am not able in the course of my speech to deal with those rather larger questions which must arise, and which no doubt will be dealt with by those following me.
  I have dealt to the best of my ability with those specific allegations and ground for suspicion which have been brought forward by the hon. Member in connection with the India Office transactions with Messrs. Samuel Montagu and Company. I can assure him and the whole House that as far as inquiry goes, whether by Select Committee or by any other body, the very last people who would resist it are the India Office themselves. They have nothing to conceal in this matter, and they court the fullest investigation. As to whether an inquiry, so far as Messrs. Samuel Montagu and Company are concerned, should take place, I venture to suggest, speaking for myself, that not one scrap of evidence has been produced to show any necessity for an inquiry. The hon. Gentleman referred to the fact that these questions and answers, and these allegations, and these expressions of suspicion had created a serious effect. Yes, I believe that is right; I believe they have created a very serious effect, and I think there is a very serious responsibility on those who now know that they have by their proceedings of the last few months done a great deal, unjustly and unfairly, to cast suspicion on the reputation of the English Government of India. I have no more to say. That suspicion, which the hon. Member adhered to, even at the very end of his speech, and seemed to think was the natural element in which he must live and breathe and move, is, I fear, not confined to him. The right hon. Gentleman the Leader of the Opposition has brought suspicion from being a mere attitude of mind into a place into which it is a cardinal point of party policy. As far

  1259
  as these transactions with which I have been dealing are concerned, we can show that the hon. Member who moved has not any case, but has even wilfully perverted it beyond the point to which a reasonable man would take it.
  Mr. BONAR LAW: I need not assure the House I am not going to follow the hon. Gentleman into the mass of detail which quite properly he has read out. I shall say a little about the last point which he raised, but in the meantime, I desire to say that I do not intend, in the very short speech which I shall make, to deal with those larger questions which are connected with the finances of India. Questions of that kind are extremely difficult, and I am bound to say, among all the subjects which I have tried to understand, there is none which has seemed to me more complicated or difficult than the question of currency, of exchange, and of credit on which business rests. Those questions are all connected with Indian finance. I am not going to deal with them this afternoon, not even with the smaller point as to whether or not those large cash balances should be kept in London, or whether there should be coinage of silver in India. Those are smaller questions, but even in regard to them, from the little examination I have been able to give them, I think there is room for some difference of opinion. As to whether a mint in India is to the advantage of India, on that again I express no opinion. The points which have been raised to-day, and which are specially dealt with in this Resolution, are really two, The hon. Member, like my hon. Friend, dealt in the end of his speech with the question of the cash balances. It has been suggested that it is awkward that Sir Felix Schuster, who is Chairman of the Finance Committee of India, should also be chairman of the bank which does business with India. Of course, other things being equal, that is a disadvantage, but I am certainly not going to press that point here, for this reason: If we are to have business men to guide the India Office, they must be business men who know something about the subject, and precisely the kind of experience which Sir Felix Schuster has got is the kind which is useful to the India Office. Therefore, I think the Government of India would be unduly tied if they felt bound to take as financial adviser, someone not connected with the bank which does business with India.
  1260
  In a case of that sort all that I say is this—and perhaps I go further than most politicians, since I have a business point of view of looking at these things—all that one has the right to ask in a case of that kind, is that there should not be any conflict of interests between the two bodies. In my opinion, so far as I have seen, there is no conflict of interests in this case. The bank has the use of the money for which it pays the ordinary market rate, and this kind of transaction went on before Sir Felix Schuster was financial adviser. The only point I make in regard to these financial balances is, that after looking into them very closely, I do not think the Government of India got as large a rate of interest as they ought to be able to get. [Mr. ANNAN BRYCE made an interruption which was inaudible.] The hon. Member is a great financial expert, but perhaps he will allow me to develop my own argument. I do not think they got as large a rate of interest as they ought to get. I have looked at the figures given to my hon. Friend, and I find, taking the years 1910 and 1911, the two years for which complete returns are given, the rate of interest obtained by the Government of India was fully 1 per cent. less than the Bank of England rate. I think that was distinctly lower than the Government of India might obtain without any risks whatever.
  Mr. ANNAN BRYCE: No, no.
  Mr. BONAR LAW: I have a little experience. I was for a very long time a director of a bank, and, without being dogmatic, I must be allowed to express that as my opinion. In my opinion it ought to be got—
  Mr. ANNAN BRYCE: They are short terms.
  Mr. BONAR LAW: But there is no need of short terms. They have a very large amount of money to dispose of, and it is quite obvious that they must have the right to call some of it up on short notice. I would not suggest that any of it should be lent for a long time. It is not that I have in my mind, but I see no reason why the loans should not be so arranged to fall in at stated intervals.
  Mr. ANNAN BRYCE: So they are.
  Mr. BONAR LAW: The hon. Gentleman has a very strong opinion on this

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  subject, but I am bound to say, and I think I have some reason for saying it, that you could lend that money on an average of years with perfect security at something like a half per cent. below the Bank of England rate. That is my belief. If that is possible, it would mean a saving to this country on the £15,000,000 of something like £75,000 per year. I know that under the present arrangement one of the reasons why they get such a low rate is that the Government of India insist on a particular kind of collateral security.
  The PRIME MINISTER: From the borrower.
  Mr. BONAR LAW: I do not think that is necessary. All they want to have is absolute security for the loan. I do not think the particular kind of security is necessary. Without being dogmatic I do say I think it is worth while that inquiry should be held, and perhaps the right hon. Gentleman would examine into it and see if there is not ground for a reasonably higher rate of interest than that obtained now. I think inquiry of that kind at least ought to be made. The other subject is the question of the silver coinage. The hon. Gentleman who has just spoken made reference to a remark which I made when I was asking for a date for this subject, and on that occasion I said the question seemed to me like "drawing teeth." The right hon. Gentleman took exception to the phrase, and said he was sorry I had used it, but I do not think he was present in the House while these questions were going on as frequently as I was. It really did seem to me the way in which the information was got was, as it were, tooth by tooth, instead of making a clear statement. That was all I meant, and if the right hon. Gentleman refers to the question, when I asked for the Debate, he will see I distinctly stated then that in the public interest, and in the interest of the Government themselves, the moment they found there was suspicion in regard to this matter, they ought, in justice to themselves, to have taken time to explain the whole thing to the House to get rid of that suspicion, and bring the matter to a head. That was all I had in mind by pressing it in that way.
  The hon. Gentleman has said that I have made charges of corruption in party politics on suspicion. I wish to point out to the House that, though I have made charges of corruption or suspicion of corruption, I have never suggested, and I
  1262
  have never had in my mind, the smallest suspicion that there was any personal ground of suspicion against any Member who sits on the Government Bench. That is not what I meant by corruption. The kind of corruption I think we have a right to fear, is not that Cabinet Ministers, like the right hon. Gentleman, or his colleagues, will try to enrich themselves out of the public purse; there is no fear of that at all. I never suggested it.
  The PRIME MINISTER: Or their families?
  6.0 P.M.
  Mr. BONAR LAW: And the families. I believe that when a man makes political life his ambition, he sinks the smaller things, and even money, however important it may be, becomes a secondary consideration for the sake of the higher ambition; and that he would not, even from the most selfish motives, for the fear of losing the thing to which he attaches the greatest value, listen to something much less, and which is secondary. I have never entertained that kind of suspicion. The suspicion which I do entertain, and which I think is more dangerous to the State, is that of using patronage in order to help your political party, and to strengthen the political machine. That is what I mean. I do not say, and I do not suggest, that even that kind arises in connection with this matter, although there was a possibility of it. I say at once I do not for a moment suggest that the right hon. Gentleman, the Postmaster-General, as I have far too much respect for his ability to suggest anything of the kind, had anything to do with this transaction. On the contrary, I give him credit if he had known of it, knowing what politics are, he would have done his best to stop it, and would have stopped it if he could. I say the same of the Under-Secretary of State for India, and I take exactly the same view. I believe that among all those who feel aggrieved by this transaction, there is nobody who had so much right to feel aggrieved as the Under-Secretary of State for India. He was in a position of peculiar delicacy in this matter. Such a transaction which might directly affect him and his political future ought not to have been entered into without his knowledge by his brother's firm. They took the purely business point of view, that as long as the Under-Secretary knew nothing about it, it was all right; but if they did not protect him, I think the India Office ought to

  1263
  have protected him, and pointed out clearly the nature of the transaction which was carried out by the firm with which he was so closely connected. There is no charge of that kind, but I do say this: after looking into it as closely as I could, that this business was just as unwise in the public interest as could be undertaken by any Government Department. That is my belief. I will tell the House why. It is not like giving a public contract with
  the Government where there is competition and where the most you can give is some slight favour. It is far more important than that. It is a far greater advantage to the firm which gets such a contract as this. What is the advantage? To any firm whose business it is to deal in silver the obtaining of this contract gives them without any doubt the means—I do not suggest that they took advantage of it—of making money practically to any extent they chose. That is the real effect, and it is obvious. My hon. Friend has pointed out that the knowledge that the Government of India were buying, and still more the knowledge given to the firm at the outset that they were going to buy right away £2,000,000, gave them the means of making money by dealing in silver on their own account. If they chose to buy they would know exactly the moment to sell, when the Government of India ceased to buy, and they could make practically any money they chose out of the transaction. No honest firm would do that, and I do not suggest that this firm did it. But there were other indirect ways of which business firms might think. For instance, there is a tremendous amount of business done in exchange. That exchange depends in Eastern countries—not in India—on the price of silver. The knowledge that this firm had, that silver was going to keep firm and probably rise, gave them the means of dealing with that exchange in a way that no other firm in London could, and they had the possibility of making any amount of money in that way. The point is that by giving this contract you do give a particular firm a means of making money to whatever extent they think reasonable, and I say that, of all the firms in London, the very last to which such a special privilege should have been given, unless there was special necessity, was the firm of Messrs. Samuel Montagu and Company. I do not think that that would be disputed.
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  In business life the principle which is daily acted on is that we should help our friends. If a friend of mine can do my business as well as anybody else I give him the business. But if that becomes the principle in Government contracts nothing could be more fatal to the purity of administration. The very opposite principle ought to apply. If a firm has any special connection with the Government or with the party it ought to be a handicap rather than an advantage to them in obtaining business. I think that will be admitted. The view of the Government in these circumstances is pretty evident. I remember that the first Debate to which I listened in this House was a Debate on the Address on the question of contracts, and if anyone wants to know what the views of the Government are let them read the Debate on that Amendment. What was it? I remember it well, because, as I say, it was the first Debate to which I listened in this Houe. Every one of the speakers who were making charges against my colleagues, as they afterwards became, said that there was no charge of corruption and no charge of improper motive. The speeches were full of "Cæsar's wife," and of "avoiding even the appearance of evil"; but they said that the Government had put themselves into a position where they would be suspected, and that that was enough to open the floodgates of corruption. I have some extracts here, but I do not know that it is worth while to read them. I am sure the Prime Minister remembers them.
  The PRIME MINISTER: I did not take part in the Debate.
  Mr. BONAR LAW: No, I do not think the Prime Minister is very fond of that particular form of controversy, but probably he voted. The speeches contained very unpleasant insinuations, but every one of the speakers repeatedly said that there was no charge of improper motives against anyone, and that their whole contention was that the Government ought to avoid suspicion. Can anyone imagine a case more likely to raise suspicion than the giving of this special privilege to this particular firm? We all know what their position is. The partners are related in the closest way to Members of the Government, and to one Member who is connected with the Department concerned. But I do not think that that is the worst feature. I do not think that that is a connection which should have precluded them

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  more than any other. But look at the relations in which they stand to the Radical party. One member of the firm is a supporter of the right hon. Gentleman in this House, and was made a Baronet. The late head of the firm was made a Peer by the present Government. A firm of that kind is the last to whom such a contract ought to be given. It all comes down to this: Was there any necessity for departing from the previous custom in this matter? That is the whole question. Unless that can be shown the Government have at least made a mistake. I am not going to find fault with the literary correspondence of Messrs. Samuel Montagu and Company, but I really must refer again to what the hon. Gentleman describes as the vivid and graphic language. They are a business firm trying to get an order, and they are pushing their wares to the best of their ability, just as other people push theirs. Substantially they say, "The inevitable result will be that you will have to pay more or less whatever you are asked." The hon. Gentleman said, "These speculators are holding silver against the Government." How in the world can you hold silver against the Government? If a man holds silver he does not injure the Government; he only injures the Government by buying against them. Just see how this corner works. I am sure there are business men present who know what a corner is, and understand the whole transaction. It is not an easy thing in any case, but the way in which a corner is brought about is by getting your power over the "bears," the people who have sold the particular commodity in the expectation that they will make a profit. It is comparatively easy to make a corner in that way for this reason, that the material is sold for delivery on a particular date, and if you cannot deliver it on that date, then your buyer has you in his power, and can force you to pay practically any price that he chooses to demand.
  But how in the world are you going in that way to corner the consumer? Think what it means. Of the total quantity of silver which comes to this market, something like three-fifths, or nearly two thirds, is used in industry and art and that kind of thing. You can only corner the Indian Government by cornering the whole silver trade at the same time. One is in precisely the same boat as the other. How would they proceed to do it? The silver they hold does not help them in the least. The silver is coming into the
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  market, and the Government would buy it. The only way they can corner the Government is by going in and buying the silver as it comes week by week into the London market. See how the Government could deal with that. They would at once stop buying. They are under no compulsion to buy. The hon. Gentleman said that they did not need to buy at all till August, and these purchases began in January. How would these "wicked speculators" get on? Let the Government of India refrain from buying for three months. Seven and a half millions would come into the market, and these people would have to buy and hold. That is assuming that they are raising the price against the Government. If the Government held off for six months, fifteen millions would come in, and the speculators would have to buy it all at inflated prices. The only way that they could make a profit out of it, after buying the fifteen millions, would be to sell to the Government of India something like half the quantity, and to sell the remainder at a price which they cannot get. Obviously, to say that the inevitable result would be that you will have to pay any price you are asked is simply nonsense, and though the letter was written to Sir Felix Schuster, I think he must have smiled when he read it. I do not think it was intended seriously, but it had its effect.
  I read the speech of the Secretary of State for India in the House of Lords the other day, and I do not remember any speech which amused me more. He pointed out that in the last ten years there had been a fluctuation in the price of silver of so much. "Now," he said, "suppose we had made this contract at the highest point of difference between these prices, we would have paid three millions sterling more than we have done by buying the silver through Messrs. Samuel Montagu and Company." "Of course," he went on to say, "I do not suggest that we have made that saving, but we have saved hundreds of thousands of pounds." How does he prove that? Because in the course of ten years the price of silver has risen 50 per cent., therefore we must have saved hundreds of thousands of pounds by buying it through Messrs. Samuel Montagu and Company. I do not see any other object in giving the figures. Secrecy, I admit, was desirable if you could get it. I quite admit that. If you buy you will probably raise the price, however much secrecy you use. But what I do not

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  understand is the ground on which the Government decided that they were less likely to get secrecy through employing the Bank of England than through employing Messrs. Samuel Montagu and Company. In these letters Messrs. Samuel Montagu and Company say that they are constant sellers, and that is one of the inducements held out. There are only four firms engaged in this bullion market. These people will watch it as a cat will watch a mouse. They will watch every transaction to try to find out if there is any buying and where it is coming from. If Messrs. Samuel Montagu and Company, who are not large brokers, instead of being regular sellers, became heavy buyers, do you suppose that these people did not notice it? As a matter of fact, since the hon. Gentleman has given me the opinion of a firm engaged in the bullion trade, I will tell him this. I have made inquiries of those who are actually in closest touch with the silver market, and they tell me on information which I believe to be quite undoubted, and which the Government can verify if they choose to go into it, that at a very early stage there was a suspicion which amounted to certainty that Messrs. Samuel Montagu and Company were buying for the Indian Government. I do not see how it could be otherwise.
  What in the world, then, is the good of all this mystery? What is the good of all these tricks of exchange? What is the good of these suggestions, that it is necessary to hide it from the Bank of England for fear they would take advantage of it? When the hon. Gentleman said that there was nothing of that kind he was quite wrong. Some bank had to be trusted. What reason had they to suppose that there ought to be a conspiracy between Messrs. Samuel Montagu and Company and the India Office to hide the transaction from the Bank of England for fear that the Bank of England would do an injury to the public service? Why ought we to suppose that the Bank of England could not have done it as well? The hon. Gentleman says because they would have employed brokers who were known to act for the Government. Yes, but he has told us that there are only four. All business must be done by these firms. Everybody knows that these firms are employed by the Bank of England, and do an immense business outside the Bank of England. Why should one suppose that they would be discovered
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  any more than anyone else? More than that, the whole basis of this change is that you were afraid of a corner. Well, now, who is better able to deal with that—Lord Crewe or the Bank of England? If you had trusted the Bank of England, as you have trusted it in the past, why should not you have gone to them and said, "Can you buy in such a way as to do it as secretly as anyone else?" From what I know of the Bank of England, and from their whole history, if the Governor had not been able to say, "Yes, we can," he would have said, "Do it through somebody else."
  I put another point which was not dealt with by the hon. Gentleman. My hon. Friend said, "Why did they not go to the Bank of England, and—if the facts are as you say—get them to employ Messrs. Samuel Montagu and Company?" What was the answer? The hon. Gentleman said that in 1910, two years before this time, the Bank of England had told them that there was a moral obligation to employ two particular brokers. If there was that moral obligation, it is precisely the same moral obligation which was broken by the India Office in taking away business from the Bank of England. Do they really say that the facts are as they thought them? Do they really say that they were bound to take the opinion of the Bank of England two years before. and that they ought not to have trusted the Bank of England again, gone to them and said, "Will you not in this case employ Messrs. Samuel Montagu and Company?" If they had done that they would have produced precisely the same result, and all this suspicion, which in itself is bad, would have been saved to the Government, and saved to the country—which is more important. I must say that I was surprised at one remark made by the hon. Gentleman the Financial Secretary. I thought he was familiar with the details of this business. He said that to have employed the Bank of England they would have paid a bigger commission. He is quite wrong. If he will look at the correspondence he will find that precisely the same commission would have been paid if the Bank of England had been employed as to Messrs. Samuel Montagu and Company.
  Mr. BAKER: Will the right hon. Gentleman allow me? I really think he is wrong on that point. In addition, there would have been the commission paid to the broker.
  Mr. BONAR LAW: If the hon. Gentleman will read the correspondence of 1907 he will see what the bargain was. He ought to know that the bargain was that the rate was to be ¼ per cent. on the first £2,000,000 and ⅛ per cent. on all subsequent millions. If they had employed the Bank of England for the whole amount, precisely the same commission would have been paid in the one case as in the other.
  Mr. BAKER: We would have had to pay ⅛ per cent. to the broker as well.
  Mr. BONAR LAW: Not at all! Really that shows an amount of ignorance that is surprising. The Bank of England made a bargain, and the letters show that these rates are to include the fee to them and the fee to the brokers as well. The only effect, therefore, of employing Messrs. Samuel Montagu and Company would have been that the country would have paid precisely the same amount, but that Messrs. Samuel Montagu would have had to be content with a smaller commission. That is the whole matter. As regards this question of having saved money. I say it is purely conjectural. Nobody can tell. But there is this fact, which at least is as near a proposition in Euclid as anything the hon. Gentleman can give: Messrs. Samuel Montagu bought £5,000,000, and in buying it they raised the price something like 10 per cent. The order was then taken from them and given to the Bank of England, and they, according to the correspondence, bought £1,000,000—I suppose they are still buying—I suppose I am right in saying that they have bought £2,000,000 since? What happened? Messrs. Samuel Montagu and Company raised the price 10 per cent. The Bank of England bought £2,000,000, and have not raised the price a single percentage. I do not say that is due to better buying. I do say that we would have a better right to say that the Government have saved money by buying through the Bank of England and by taking away the order from Messrs. Samuel Montagu than they can say they have saved money by having taken it away from the Bank of England and giving it to Messrs. Samuel Montagu. That is really all I want to say. I do think that the case for the special necessity which justifies this special method of dealing has not been made out. I am not going to make any charge against Messrs. Samuel Montagu. A business firm has a right to push its business. It is the Government alone who are responsible, if there is any blame in the
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  matter. More than that, in looking through the correspondence, they have so far as I can see done their best to do the business satisfactorily.
  So far from suggesting that it has been a tremendous scoop for them in which they have acted dishonestly, I think they must have actually lost money by this transaction. I do not see how it can be otherwise. In the letter which they wrote begging for the business they showed clearly that they expected the price would go up. That is their reason for the advice they gave. They are dealers in silver, and naturally, holding that view, they would have held silver on their own account in the hope of making a profit. Obviously they could not do that after they were trusted by the Government. Of necessity—at least they would be departing from all commercial morality—if after they were trusted by the Government they continued to deal for themselves, and the result of that must have been, in my opinion, that instead of making £7,500, they would have lost a great deal more. I do not suggest that they did think of that, and I do not ask for an inquiry into that matter. It does not concern the Government. It is a question for a private firm. I do not believe they did that. If they are satisfied to leave it where it is so am I. It is no business of mine. I am quite ready to accept the statement that they have made no improper use of the information given. I do not think we have put this case unfairly. I think I have a right to say that you cannot be too careful in cases of this kind, and that the very last thing that you ought to do is to give Government business, which must be of special value, to a firm which is specially connected with the Government. I do not know whether the right hon. Gentleman thinks that some further inquiry of some kind is desirable. The only point really that I think in the public interest an inquiry is of importance is in regard to the investment of cash balances on the one hand, and also I think it is useful for the sake of future dealings of this kind to try and find out whether all this melodramatic secrecy had any result. I think both these things might be worth inquiring into. So far as I am concerned I make no charge of corruption, either against the Government or against Messrs. Samuel Montagu and Company. I say only that in my view a very grave mistake was made in taking the business from the Bank of England. I think the Government treated the Bank of England

  1271
  most unfairly. I think if there is one thing that the whole traditions of this country show, it is—I am sure the right hon. Gentleman the Prime Minister will agree—that the Bank of England does look upon itself as something in the nature of almost a Cabinet; that they do regard their responsibility as as grave as that of any Member of the Government; and I think if proof were needed of that—though it is a very small kind of proof—the suggestion was made that the Bank of England had written a letter—I heard an hon. Gentleman ask was there any connection between the two? Well, I have tried to get information about this, but I would just as soon have thought of going to the Prime Minister as going to the Governor of the Bank of England. I believe—and I am sure I am right—that they act for the Government of the day, whatever it is; and that the last thing they would do would be to give information in a matter of this kind that would be used by the Leader of the Opposition against the Government. I think the Bank of England have been badly treated. I think it was a mistake from the beginning to the end, and I hope the hon. Gentleman will give us an indication that mistakes of this kind will not be made again.
  The PRIME MINISTER: I have listened with great interest to the speech of the right hon. Gentleman. With its general tone and tenour, I have no reason to make any complaint. The right hon. Gentleman gave us at the outset—and I was very glad to hear it—a definition, or at least a more extended exposition than we have hitherto had, of his view of what I may call "the ethics of political corruption." In the course of that exposition he was good enough to acquit himself and my right hon. and learned Friends who sit on this Bench, of any charge of complicity contrary to the public interest, in the various transactions. I am quite sure the right hon. Gentleman said that in full sincerity, nor have I ever thought, to do him justice, that he ever thought anything worse. I should like to take the opportunity on these observations of his to say that I think terms like "corruption" and "suspicion of corruption" are too freely employed in the vocabulary of the present day. Although we know quite well in this House the sense in which they are used, they are read, interpretated, and understood in a very different sense by people outside.
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  No one knows better than those I am addressing on both sides of the House that if any man in this country of decent abilities and character wants to further his own personal and pecuniary interests, the last thing he would do would be to take up politics as a profession. That I believe to be the case—indeed, I am sure it is the case! I do not say anything about individuals either on one side or the other, but I do not think I am exaggerating or taking an exaggerated view of our individual and corporate life, when I say that we could have taken our pigs to a much more profitable market in almost any part of this country, and in any career in the world than in the career of politics. I was glad to hear, and to have got, that very explicit statement of the right hon. Gentleman. It is desirable that it should be understood everywhere in the country on all sides that when allegations of this kind are made, they do not affect and are not intended to affect—
  Mr. BONAR LAW: By me.
  The PRIME MINISTER: I take the right hon. Gentleman as the spokesman of his party—are not intended to affect the personal integrity and honour of individuals. That by the way. I was particularly glad to hear the right hon. Gentleman say what he did—because, although the hon. Gentleman who made this Motion disclaimed quite pointedly and explicitly any intention of making reflections on my hon. Friend the Under-Secretary, yet there was a passage in his speech which I hope, upon reflection, he will see was not only totally unnecessary to his argument, but was calculated to give, at any rate, some kind of colour to the imputation which he did not expressly and directly make. May I say, in passing, that while I very much regret the absence of my hon. Friend, I take the whole responsibility. He went to India at the request of the Viceroy, and in the opinion of the Government, for the very useful purpose of studying at first hand—before any of these questions were raised—Indian policy and Indian administration. I know from communications I have had from him that he was most anxious to return and deal personally with these matters, but I took upon myself the responsibility of telling him that he ought not to curtail his visit, which is in the public interest. If I was wrong, the fault is mine and not his. When the hon. Gentleman elaborated at some length the

  1273
  various relationships and connections of my hon. Friend with members of this particular firm I cannot conceive what object he had in view, or how in any way he advanced his argument, unless it was to suggest, at any rate, that there was some kind of indirect, subterranean connection between the giving of this contract to Messrs. Samuel Montagu and Company and the presence of my hon. Friend in the position of Under-Secretary for India. I know he disclaimed that.
  Mr. GWYNNE: To which passage is the right hon. Gentleman referring?
  The PRIME MINISTER: To the passage which is in the recollection of the House. I took particular note of it at the time: I listened to it with very great regret, and I am sure the hon. Gentleman did not intend the interpretation which everybody who heard it would naturally put upon it. That brings me to what the right hon. Gentleman who has just sat down said upon that subject. I quite agree with him that any Government—I do not care which party is in office—ought to show scrupulous care in giving contracts or employment in the public service to persons who are directly or indirectly connected either by relationship or business with any of their members. I do not think you can be too scrupulous, and although I should hardly like to accept the phrase of the right hon. Gentleman that such firms or persons ought to be regarded as handicapped, certainly they ought not to be entitled to preferential treatment, and they ought not to be employed in competition with others, unless a case of clear superiority in the public interest for that particular purpose can be established and made out. There, I think, we are on common ground. And the real question to which the whole of this controversy of the silver contract is now reduced is whether the India Office—of course, many of us had no direct connection at the time with the matter; it was a Departmental matter, but we take full responsibility for it—when this contract was entered into about the spring of last year, were, or were not, acting in the interest of the people and Government of India in this contract which they made. That is the whole point. If, as I think, and as they think, acting in that interest and that interest alone, they choose the wisest and best course, then the right hon. Gentleman will not dispute that the mere fact that the firm employed happened to be connected by
  1274
  ties of blood, or whatever it may be, with Members of the Government, ought to prevent the Government or the Secretary of State from employing those they thought best able in the interests of India to carry out this particular contract. Let us see how that worked out.
  The Financial Secretary to the War Office, in his admirable speech, has covered the ground completely, and I am not going to travel again over what he said; but in reply to the points raised by the right hon. Gentleman, let me point this out. Two things are not disputed; in the first place that there was an exceptional need which came, not from here, but from India, which was made out by the Government of India to the Secretary of State for a supply of silver for coinage purposes in 1912. The reserve supplies had been considerably reduced. Fresh coinage had not taken place I think for several years, at any rate, for some considerable time past, and there was a prospective and anticipated deficit of the necessary supplies which had to be made good during the course of the summer and autumn. That is not disputed. For the purpose of making good that supply, silver had to be purchased and purchased here in England, for this is the market, the largest—I am not sure that it is not the only market—but certainly the largest and most elastic market in the world for the purchase of silver. Further, it is conceded—the right hon. Gentleman most frankly made the admission just now in the speech he made—that for the purpose of carrying out the particular transaction, secrecy, I will not say was essential, but certainly was desirable.
  Mr. BONAR LAW: Secrecy, as far as practicable.
  The PRIME MINISTER: Secrecy, as far as possible, because even if the market were in a normal state, the fact that a purchase like the Secretary of State, under the stress of necessity, had to make within a comparatively limited space of time, and that he was coming into the market to purchase so large a figure as £6,000,000 sterling of silver—51,000,000 ozs. of silver—must necessarily have the effect of raising the price of silver, and of increasing the inducements to holders of silver, to stand out for a higher price than they otherwise would have got. Then, I do not think that the right hon. Gentleman seriously disputes what I think has been quite established by my hon. Friend and colleague

  1275
  that there was, I will not say a corner—the phrase "corner" has never been used, so far as I know, certainly not on this side of the House, and not in any of the documents of the India Office, or of Messrs. Samuel Montagu and Company—I will not say that there was a corner, but there was then what is called a speculative position for a rise. I am not so well versed as the right hon. Gentleman is in this terminology, but it is no doubt a fact. And, remember, in this matter, though I do not in the least degree depreciate the right hon. Gentleman as an authority—I very much regret that the India Office could not have taken him into counsel—he is an expert in this matter—although I do not appreciate his authority in any way, the India Office had to act on the authority and advice of their expert counsellors, and it was the opinion of those counsellors, both in India, and Bombay particularly, where speculative manipulation or organisation had reached its largest dimensions, it was the opinion of the expert advisers of the India Office, both in India and in this country, that there was such a position, and that it would be in the power of those who had made their arrangements in advance, in anticipation of some such necessity, to raise the price of silver as against the Secretary of State, if he was known to be coming into the market to purchase it, and to compel him to pay a much higher price than was necessary, and therefore to inflict a heavy fine upon the revenues of India.
  These being the facts, and they are really admitted facts, was it not the plain duty of the Secretary of State, acting on the best advice he could command, to take such steps as would enable him first to obtain within the time prescribed the large amount he required, and next, to obtain it under such conditions of secrecy or, at any rate, ignorance on the part of the public, particularly those who were speculating in the market, so that they might not know that whatever purchases were being made, were made on behalf of the Government of India? I say it was his bounden duty to take whatever steps he thought necessary for the attainment of these two ends. What were the possible courses to which he might resort? He might have gone, as the right hon. Gentleman says he ought to have gone, to the Bank of England. If he did not go to the Bank of England, I do not think it is
  1276
  disputed that the only firm in the market who were capable of carrying out a transaction of this kind—perhaps I may assert this—were Messrs. Samuel Montagu. I am not going to say a word against the Bank of England. I agree entirely as to the services it has rendered and is rendering to the Government of this country; but it was no reflection whatever upon the Bank of England that in this particular case, and in these particular circumstances, the Secretary of State did not go to them. And the reason has been given by my hon. Friend, and really it is not controverted by the right hon. Gentleman. The reason was this: the Bank of England employ, whether under a binding contract or honourable obligation. I do not care—it is totally immaterial—they employ, and conceive themselves bound to employ as brokers for transactions of this nature, two firms—I need not mention their names—out of four available in the London market, who had, in all previous transactions of this kind, acted on behalf of the Bank of England acting for the Secretary of State in buying silver in the market.
  Of course, you cannot better advertise the fact that the Secretary of State was the real purchaser in the background in these transactions than to make your purchases through the medium of the Bank of England, or directly or indirectly to employ either of these firms. I agree it is difficult to say what the precise effect would be measured in terms of price; but looking at it from the prudent business point of view, secrecy being the object, time being important, the amount involved being very considerable, any wise business man would have done what the Secretary of State in Council had done, and would have said, "This is an exceptional case in which I must go to a broker whom I have never hitherto employed, and who is capable of carrying out transactions of this kind." The right hon. Gentleman says, I do not know on what authority, that Messrs. Samuel Montagu were more dealers than brokers. As far as I know, they are brokers on a very large scale. There are only four brokers in the market, and I do not believe Messrs. Samuel Montagu's position is second to any of the others. Then the right hon. Gentleman made a statement, not made before, which I confess a good deal surprised me. He said he had been informed in the City—as I understood him the information came from the City—that at a very early stage of these transactions, not-

  1277
  withstanding the precautions taken, there was a suspicion that the Montagu purchases were being made on behalf of the Government. I do not know what the right hon. Gentleman's authority is, but I can give him—I think it has been quoted already—very strong authority; in fact, the best authority in a different sense, namely, the weekly circular of Messrs. Mocatta and Goldsmidt, who are, after all, one of the most important of the four firms concerned in this market. As late as the 9th August—these purchases having been going on ever since the month of March—in their weekly circular they state:—
  "Things within a few days of our last circular were more or less affected by the Bank Holiday, the price falling to 27 9–16 in the absence of buyers. Since then, however, there has been a somewhat unexpected and sudden recovery. and to-day's price is 28 1–16. The reason for this rise is very difficult to trace and appears to be chiefly due to the rumour that the Indian Government has been, and is, buying in the market, and that a large portion of the present, stock in England itself is supposed to be held by them."
  Between the Bank Holiday and the date of this circular, 9th August, the effect of that rumour was to raise the price from 27 9–16 to 25 1–16d. How is that reconcilable with the suggestion that during all these earlier months—April, May, June, and July—it had been known, or even rumoured, that the purchasers were Messrs. Montagu acting on behalf of the Government?
  Mr. BONAR LAW: I would like to remind the right hon. Gentleman that brokers do not put into their circulars everything they know.
  The PRIME MINISTER: No, Sir. The right hon. Gentleman has an advantage of me there. I am quite sure he is speaking the truth, but what I am entitled to assume is that they do put into their circulars things that they do know:—
  "Since then, however, there has been a somewhat unexpected and sudden recovery, and to-day's price is 28 1–16."
  And the reason they give for that rise that took place between the Bank Holiday and the 9th August is the rumour that the Indian Government has been buying, and that is absolutely inconsistent that any credible rumour was prevalent in the market previously. Then the right hon. Gentleman said, and it was his last point, that he is not satisfied that a real saving resulted from the employment of Messrs. Samuel Montagu and Company. Let me say, in passing, that when you are judging in these matters that is not really conclusive. The question we have to consider is whether the Government were well
  1278
  advised in the course they took, having regard to the circumstances which then existed? I think I have shown conclusively that they were. They adopted the course which any wise and prudent man of business dealing with his own affairs, and still more acting as trustee on behalf of his beneficiaries, would have pursued. I think the evidence goes much beyond that and shows that they were justified by the result. Let me quote once more the actual figures. The first period before these rumours got into circulation—they originated the first week in August—Messrs. Montagu and Company had purchased £2,300,000 worth of silver at an average price of 27⅜. Then the rumours got into circulation, and the price went up. The second period, from the 9th August to the 24th September, which is the date of the last purchase by Messrs. Montagu and Company, they purchased £2,700,000 worth, and the average price was 28¾, a rise of a quarter per cent. Then in the subsequent period, when purchasing through the Bank of England was resumed, Messrs. Montagu, having fulfilled their contract, from November to January in the present year £2,000,000 was purchased at an average price of 29 3–16. I agree that there was other factors. My hon. Friend expressly stated that there are other factors that had determined the price of silver than a particular contract put on to the market by a particular individual. It is very difficult to isolate these different factors, and to say how much of any particular rise or fall is due to one or another or a combination of circumstances. But so far as you call judge, at any rate we are entitled to say that the price of silver was less while Messrs. Montagu were purchasing in secrecy, and it rose after it became known or after it was suspected that they were purchasing on behalf of the Secretary of State for India, and rose still higher when the task of purchasing was entrusted to the Bank of England.
  Sir F. BANBURY: If I may say so as an old broker, is it not a fact that after a big purchase, and the market is depleted of its stock, the last buyer has always to pay a higher price?
  The PRIME MINISTER: That depends on whether or not more stock has come into the market in the meantime, if I may say so to an old broker. That is another factor in the case. I say that the whole thing being more or less conjectural, if

  1279
  I have established my first proposition, which I think I have, that it was a prudent course to take in advance, I have gone some way in establishing that events justified the course we took. That being so, I agree with the statement which the right hon. Gentleman made at the close of his speech that there really is no case for any further inquiry into this matter. Now I come to deal with another matter which I think is very important, more important even than this question of the Montagu contract, and that is the question of the balances. It was referred to by the Leader of the Opposition, and rather briefly by the hon. Member who raised this question. I regard it as a very important matter, and I wish to say two or three words about it. I dare say it is familiar to most of us how these balances arise and how they are dealt with. Ever since 1838, in the days of the old East India Company, it has been the practice, since the transfer of the Government of India to the Crown in 1858, for the Secretary of State to lend out in the London market these cash balances at interest. It has the advantage that it enables the India Office to obtain interest on money which if they left it at the Bank of England would not secure any interest at all. In the last three years circumstances have been very exceptional. Up to May, 1909, it had been the habit of successive Secretaries of State to lend out the available balances to what are called approved borrowers. A list of these borrowers was kept and added to from time to time, and it amounts now I think to some sixty firms. I do not think it is an exaggeration to say that they represent in the money market of England a large number of firms of the highest repute. The balances of the Secretary of State are lent out upon approved security to these approved borrowers. I think the Leader of the Opposition rather criticised the security.
  Mr. BONAR LAW: All I meant was that I did not see any necessity for having a very narrow list.
  The PRIME MINISTER: It may be that the list was a little too narrow, but at any rate the security is of a very high class, and I do not believe there has ever been any appreciable loss on these advances to approved borrowers. Perhaps the Secretary of State has been a little too cautious in this matter, but at any rate he has been justified by the result. That has always
  1280
  been the practice. In May, 1909, a new departure was taken in connection with these cash balances for exceptional reasons, which are set out in the White Paper which has been circulated. I am not going to go into those details. The cash balances in the years 1909, 1910, and 1911 were exceptionally large, and the Secretary of State and his Finance Committee found it impossible to get the approved borrowers to absorb the whole of the available balances. The consequence was that for the first time the surplus that could not be lent to the approved borrowers was placed upon deposit at various large bankers of very high position. In the first instance I think three banks were selected. Then the number was raised to six, and, finally, it was raised to seven. No one will dispute that the banks selected were of the highest reputation in the City of London and they had head offices in London. Those advances were in the form of advances to borrowers on approved security or in the form of deposits, a method which was adopted in 1909, and they were made upon the advice of the Finance Committee and the Secretary of State.
  It has always been the habit of successive Secretaries of State to have upon the Indian Council and, of course, upon the Finance Committee, one or more representatives of the highest class of the banking world in London. At first there was Mr. Le Marchant, and then Lord Inchcape, and when he retired Lord Morley appointed as his successor Sir Felix Schuster, and then Lord Crewe appointed Mr. Lawrence Currie. No one will dispute that these were the strongest men amongst the banking community of London, and when it is said, as I have heard it said, that deposits were made after the system of deposit began in 1909 with banks of which one or more of these gentlemen were governors or directors, that is perfectly true. At the same time the list of bankers with whom the deposits were made has been constantly enlarged. I am told that bankers often refused deposits because the charge exacted by the brokers of the India Office was higher than they could afford to pay, and no kind of favouritism and partiality of any sort was ever shown. It is important to remember that every week these advances, whether made upon security or by deposit in joint stock banks, were submitted for approval to the Finance Committee, which comprises, in addition to eminent bankers, very distinguished Indian experts, such as Sir Charles Egerton

  1281
  and Sir Theodore Morison. So you have the joint opinion of these estimable men as to whether or not these particular borrowers, securities, or banks were for the time being proper securities. That system of deposits continued for three years, and it has now come to an end because the surplus balances during the last two years have been very largely applied in paying off the floating debt of India, which has been reduced by very many millions. I do not complain in the least of the questions that have been put and the legitimate curiosity which has been shown in regard to this system. It is perfectly natural, indeed it is very desirable, that the House of Commons should keep in touch with these matters, and I thought it right to go into the matter at some length in order that the House may be assured that every possible precaution was taken in very exceptional circumstances to secure that the revenues of India were applied to the very best possible advantage.
  Sir J. ROLLESTON: Will the right hon. Gentleman explain to the House how these balances arose? I was rather disappointed that he did not do so.
  7.0 P.M.
  The PRIME MINISTER: I said they were explained in great detail in the White Paper, and it was to save the time of the House that I did not go into details. I may say that, in the first place, owing to a very large active movement of trade in this country and India, a large number of bills were sold by the Secretary of State which were met by rupees in India, and they were due to unexpected excesses in the Indian revenue, particularly in regard to opium and under-spendings on the part of railway companies and other companies in India. I wish in conclusion to say this: I think this question of the balances, and, to some extent, perhaps, the other question, opens up matters of very large importance. It opens up the question of the location and management of the balances of the Government of India and the organisation of and responsibility for the financial side of the India Office; and in their turn these questions lead up to a consideration of the system adopted in relation to the maintenance of the exchange value of the India currency. In all these matters the India Office, if I may say so, has lived on as a kind of survival and development of the old parent commercial company, the East India Company. Neither the Government of India nor the India Office are indifferent to their
  1282
  importance, and we think, and they agree with us in the view, that, although an inquiry into matters so technical by a Select Committee of this House would not probably be the best means of obtaining the desirable result, we have reached the stage at which there should be a thorough investigation of these matters by an expert body, I think, in preference, I should say a Royal Commission, but at any rate by an expert body which can go into the whole question, the organisation of the India Office, the use of the balances, the maintenance of the standard of currency, and in particular—it is most important in this matter to have Indian opinion with us—as to how far we are dealing fairly as between India and the United Kingdom with regard to the manner in which we employ the surplus revenues. I think I may say this Debate will have served a very useful purpose if it enables us to put on record with the general assent of both sides that the time has come for the institution of such an inquiry which will, I hope, be attended with beneficent results, both to the United Kingdom and to India.
  Mr. TOUCHE: I listened with great satisfaction to the concluding sentences of the Prime Minister's speech, because they show the Government recognise the time has come when an investigation should be made, not into the narrow question of the recent purchases, but into the much larger and more important question of the administration of India Office finance. I regret, as no doubt all the Members of the House regret, the absence of the Under-Secretary of State (Mr. Montagu) during this Debate, but I think all will agree that the defence of the India Office has in no way suffered from his absence. I do not wish to refer to the atmosphere of suspicion about which a great deal has been said but I think it has been largely owing to the methods adopted by the India Office themselves. The Financial Secretary to the War Office (Mr. H. Baker), in his able statement, took pride in the fact that he had not been reticent, but that he had given a very full and complete and ready answer to the questions addressed to him across the floor of the House. I would like, however, to remind him that some of the information asked for and supplied by him had been asked for by me a good many months earlier, and had been refused by the Under-Secretary of State for India. I do not know whether that means the hon. Member for Accrington is of a

  1283
  more frank disposition than the Under-Secretary of State for India. Perhaps it only means that the hon. Member for Eastbourne (Mr. R. Gwynne) is more persistent in his inquiries than I could ever hope to be. I cannot claim, like the hon. Baronet who represents the City (Sir F. Banbury), to be an old broker, although I have come into contact with a good many brokers and have seen a good many transactions; but, as one who has some knowledge of City affairs, I felt it quite an education to sit here to-day and listen to the views of politicians upon these intricate questions of buying and selling. They have given me quite a new light upon many subjects. I was particularly pleased to observe the simple faith which the Prime Minister has in brokers' circulars. He evidently believes they tell the truth, the whole truth, and nothing but the truth. Apparently they are a much more guileless body of people than we have hitherto supposed.
  Let it be admitted for the sake of argument that the procedure adopted by the Government had the advantage of securing secrecy and that the market did not know that Messrs. Samuel Montagu and Company were buying for the India Office, then we have got this state of things: Messrs. Samuel Montagu and Company were known in the market to be large buyers, not for the India Office, but for some other client. It was also pretty well understood that the Government of India. if not actually buyers at the moment, would soon be buyers, so the result of this secrecy was to give the dealers in and sellers of silver the notion that they had not only one big buyer, but two big buyers. Everybody who has had any experience of dealings knows that if you wish to put the price up the best way is to let it be supposed there is more than one big buyer. It seems to me, therefore, this elaborate programme of secrecy, if it had been successful—I do not for a moment think it was—would have had the result of putting up the price instead of cheapening the price. I am personally much more interested in the larger questions referred to by the Prime Minister in his concluding observations than in any of the smaller and narrower transactions which have been discussed at great length to-day. I am much more interested in the broad questions of policy. The question of the silver purchases is undoubtedly important, but it is only a by-product of
  1284
  the present administration, faulty as I think it, of the India Office. It is the failure of the India Office methods which has created the situation from which the recent troubles have sprung, and I am a little surprised that during the Debate today we have heard so much about the silver purchases and so little about the policy which has made it necessary for the Government of India to buy these large quantities of silver within a very short period of time, and also about the policy which has produced those large balances belonging to India which have been in the London money market in recent years. It is the general policy pursued by the Government of India which encouraged this ring of native speculators to attempt to put up the price against the Government, and to "spread the net in sight of the bird," as stated in Messrs. Samuel Montagu and Company's letter. It has to a certain extent been successful, because, when the Government did buy, it made the price considerably higher than that which had been ruling for a good many years. It was that policy which gave the enterprising firm of Messrs. Samuel Montagu and Company the opportunity, I will not say of poaching, but of competing on the Bank of England territory on the plea that they were in a position to outwit the speculators.
  I think it is desirable in considering this question that we should distinguish between the policy which led to the recent purchases and the agents who were employed in making the recent purchases. India's complaint would have been strong if there had been no employment at all of Messrs. Samuel Montagu and Company. The complaint which India makes is that the India Office juggles with the balances of India, and interferes in the business of exchange and currency in a way which is prejudicial to India's interests and contrary to the recommendations of the Committee on whose Report the present monetary arrangements of India are based. Whether that Report represents the last words of wisdom in the question is not a matter we need discuss at this moment. I do not think it does. A certain system having been adopted, it was the duty of the India Office to give it free play and a fair chance, and that is what they have not done. They have tampered with India's system of exchange; they have interfered with it as no Government should interfere. A system of exchange should, as far as possible, be automatic; the less

  1285
  a Government interferes with its working the better. The India Office does not allow it to be automatic; it is always dealing in exchange; it has become one of the biggest money trusts of the world. I submit the India Office have no right to interfere with the natural course of exchange beyond restricting fluctuations within the bullion points of about 1s. 3 7–8d. and 1s. 41–8d., or 1s. 45–32d., which is the whole basis of the present currency system of India. The public, in other words, should always be able to buy from the Government of India rupees at not less than 1s. 41–8d., and to sell them at s. 37–8d.
  This is not a question which can be discussed as a single issue. The purchase of silver, the sale of Council Bills, the sale of telegraphic transfers, the large balances, and the Gold Standard Reserve, are all intermixed and all related to one another. One cannot take one branch of the subject and deal with it apart from the others without leaving the question very incompletely considered. The subject receives far, far too little attention from this House, and I am afraid does not carry with it that element of public interest which is involved in questions of a more lively, personal character. I hope, however, the House will grant me their indulgence while I recall to their attention the system of currency and the system of exchange which exists with regard to the financial affairs of India. It must be remembered that the rupee is used for nearly all internal transactions with the natives, and I think it will continue to be so used for a long time in India notwithstanding the gold standard.
  Gold is used in financial circles and to some extent for hoarding, but silver is, and will long remain, the coinage of the people. The coinage of the silver rupee is a very profitable Government monopoly and it is the duty of the Government to see that there is always a sufficient supply. They took upon themselves that responsibility when they closed the mints. When people here wish to make payments in India and owing to the balance in favour of India's trade, these remittances to India have been very large lately, they pay gold to the India Office and receive a credit for rupees in India. The effect of that is to diminish the rupees in the possession of the Government in India and to replace it by gold in the possession of the Secretary of State in London. Such transactions as these enable the Secretary of State by selling
  1286
  Council Bills to bring over here not only the amount required for home charges, which is some £16,000,000 or £17,000,000, but they enable him to provide a margin for contingencies. In the old days a margin of a few millions was considered ample. Now it goes far beyond that. The Secretary of State goes on accepting gold here and giving rupees in India, thereby transferring money from India here. The result is that these immense cash balances have been growing year by year. It was reiterated in yesterday's White Paper, that the explanation of these large balances, or at any rate one of the chief explanations, is the excess of the sales of bills and telegraphic transfers over the Budget Estimate. These transactions are not required for the needs of the Secretary of State at all, nor for the needs of the Government of India. Why are they engaged in? We are told it is to help trade. That is a protectionist doctrine which naturally appeals to me, but it should be remembered that the Government is not the only channel for getting money here or sending it out, nor is the Secretary of State for India the only medium of exchange. There are transactions to and fro with other British Territories without their aid.
  Assuming it to be right to sell transfers beyond the requirements of the Secretary of State it should not be done below the rate of 1s. 4⅛d. The undertaking they have given is to sell at is. 4⅛d. This is done in order to give automatic stability to exchange. Gold then would be received by the Government here and rupees would be paid out in India. The gold received here would be used in buying silver to be sent out to India and minted there to take the place of the rupees sold. The difference between the cost of the rupees, which is 9d. or 10d., and the token value, which is 1s. 4d., would go to the credit of the gold standard reserve, so that the gold standard reserve cannot be treated as a question apart from the silver purchases. That was the automatic system established in India, and it would have worked very well if it had not been interfered with by the India Office. One criticism and fear at the time it was established was that it might lead to a redundancy of currency in India. It was therefore intended that sales of bills and transfers should only be made at 1s. 4⅛d., and not as the Secretary of State has been doing below that rate. The Secretary of State would not then be used as the constant

  1287
  channel for commercial remittances, as the remitters would not buy more than they had actual necessity for at that rate, knowing it to be the maximum. That in itself would have been a check upon redundancy of currency, and the large balances would not have accumulated here. The Secretary of State has not observed these provisions. He has sold continuously below the bullion point of 1s. 4⅛d., and has thus deprived the gold standard reserve of profit, and has increased the risk of redundancy of currency. I think the risk of redundancy of currency has often been greatly exaggerated.
  The Secretary of State's operations have had this effect: they have depressed the rates against the interests of those who export British manufactures to India, especially Manchester. He has accumulated these large balances of gold here instead of buying silver automatically and placing the profit to the gold standard reserve again robbing the gold standard reserve. That is how it was intended the gold standard reserve was to be built up. When money is flowing to India a reserve is being created to meet the demand when the flow is the other way. Some day exchange will be the other way. There will be famine or bad trade or disturbance and an adverse trade balance, and people will be sending remittances home. They will then bring their rupees to buy gold, and if the Government refuse them gold against rupees, the whole currency system will break down. If they grant gold the profit on coinage, which they are now making, and some of which they are spending as if it were revenue, will all have to be given back to the public. If they do not build up a reserve, they may be compelled to refuse to give gold for rupees, with disastrous results to the Indian trade by the destruction of confidence in the currency system. Under adverse trade conditions in India exchange can only be guaranteed in so far as the Indian Gold Standard Reserve suffices to guarantee it.
  What has the India Office been doing? It has not been using the gold received in London for the purpose of replacing rupees, but it has been keeping the money here and lending it at 2½ per cent. to bankers and approved borrowers, people who have done nothing for India, when, to a more or less extent, the Government themselves were actually borrowing at 3½ per cent., and more
  1288
  than that, because they were placing loans at a discount, the price being 90 to 97. I cannot see any justification for a policy of that sort, and the only shadow of justification is that during the adverse conditions which prevailed in 1908 the Gold Standard Reserve had to be brought into use, and was applied in paying gold for rupees, and thus became choked with rupees. In October, 1908, the total reserve was £18,000,000. Of that the sterling portion had been reduced below £6,000,000, making a balance of £12,000,000 represented entirely by rupees. They had about 1,808 lakhs of rupees, which were valued for reserve purposes at is. 4d., but were only worth 9d. or 10d. There was no gold in the reserve. It barely proved enough in that year for the first moderate strain put upon it. This glut of rupees, which was exceptional, took place in 1908. It affords the only shadow of excuse which the Government had for not completing the ordinary programme. I daresay they thought they were doing the best they could do under the circumstances. They used that temporary glut of rupees as an excuse for not making provision to meet the expanding trade of India and providing for the inevitable demand for rupees. For four or five years they bought no silver. There might have been some justification for going short for a limited period, but there was none for going short for a period of four or five years. They might during that time have bought gradually month after month without disturbing the market, but they kept off, and they lent money in London at 2½ per cent. until a time approached when they were compelled to buy an enormous quantity of silver in a period of a few months. There may have been a certain amount of Oriental magnificence about it, but it is not business.
  The members of the India Council did not foresee the demand for rupees. They underestimated the position. They might have been forgiven if it was the only time, but it was not the first time nor the second. It was the third time. They had been warned against the dangers of drifting into a position of that sort. They ran the risk, and so caused a great deal of unnecessary anxiety to traders and bankers. I venture to think that this much-abused firm of Messrs. Samuel Montagu and Company made a much better estimate of the statistical position than the India Council did. They saw the position into which the India Council was drifting. That was the

  1289
  very origin of their letter of 8th January last year. Other people also had seen the statistical position. Everybody seems to have seen where the India Office was drifting except the India Office itself. Native speculators made a better estimate than those distinguished financiers who at present control the finances of the India Office. That was the position which the India Council had gambled themselves into, and having arrived at a time when they were compelled to buy very large quantities of silver during a very short period, naturally under these circumstances they were made to pay a higher price than otherwise they would have had to pay. You cannot make an absolute corner in silver, but you cannot go into the market and buy large quantities within a limited period without putting up the price. I admit that to some extent that difficulty may have been met by the employment of Messrs Montagu and Company. It clearly was not wholly met. There was a substantial advance of the price, and there was also all this undignified procedure and subterfuge and these manœuvres, which make very unpleasant reading in the White Paper, and which were not worthy of a great Government. One hon. Member who has spoken has pointed out that the annual output of silver in the world is limited. It is pretty well known what it will be, where it will come from, and what proportion will be required for arts and manufacture. The India Office actually drifted into a position where they were compelled to buy within a single year an amount equal to nearly the whole of the silver output during that year which was available for the purposes of coinage.
  We have discussed whether a profit or loss has been made by this transaction. I have no hesitation in expressing the opinion that the policy of the India Office led to their having to pay some hundreds of thousands of pounds more than they need have done for the silver. In the four years 1908, 1909, 1910, and 1911, the price of bar silver was 24 and a fraction. There is nothing very abnormal about that. If we go back about ten years the rate was about the same. It was much higher at one period during the interval, and the reason why it was so much higher was that the India Office were then doing what they are doing now. They had got into a position where they had to make enormous purchases in a short period of time, during the years 1906 and 1907. In the months between 5th March and 15th
  1290
  August, 1912, the India Office bought at an average of 27 11–16ths, whilst the rate was 24 3–8ths in the corresponding period of the year before. We are told this purchase at 27 11–16ths was made during the period of secrecy. We have had a division into three periods, a period of secrecy, a period of suspicion, and a period of certainty. During the period of supposed secrecy they were paying nearly 3d. per ounce more than the price ruling during the corresponding period of the year before. I believe, although brokers do not put it in their circulars, that includes the period in which it was rumoured persistently that large purchases were being made on behalf of the India Office. In the two months, August and September, over £3,000,000 was purchased at an average price of 4⅛d. per ounce higher than the price which ruled in the year before. That was an advance of something like 17 per cent.
  Fourpence an ounce on 50,000,000 ounces represents a loss of over £800,000. I do not believe they could have carried on these operations for a period of years without raising the price to some extent. But even 3d. an ounce would have represented £625,000, therefore it is no exaggeration to say that by delaying their purchases until the last moment the India Office have had to pay an additional price of some hundreds of thousand pounds. Lending money at 2½ per cent. does not go very far towards making good losses of that sort, yet we are told that the transaction resulted in financial advantage to the India Office—I think the expression used by the Financial Secretary to the War Office to-day was that there was an enormous saving. If people can delude themselves into taking that sort of view they ought not to be in charge of important financial affairs. That there was a need to buy was obvious to everybody but the India Office advisers. It would have existed in any case. It only required a bountiful harvest to make the demands acute. The complaint made against the Council is that they deliberately ran alternative risks; first, of having to buy, in the words of Messrs. Samuel Montagu and Company's fatherly letter, paying more or less what the Indian speculators asked, or of having to face a shortage of rupees and being obliged for the third time to refuse to give rupees in India by telegraphic transfer against sovereigns tendered in London at 1s. 4 5–32d. The action of the Secretary of State for India

  1291
  has practically been an encouragement to speculation in silver. All this scandal, trouble, and suspicion would have been avoided if the ordinary course had been followed, and the India Council had not speculated.
  Nothing causes more resentment in India than the way in which India's cash balances are exploited for the benefit of the London Money Market; I will not say for the benefit of certain financial groups in London, because I do not want to say anything invidious about the borrowers. It is the principle of having the funds here, and lending them in the Money Market when India has need of them to which I take exception. The total securities in cash held in London have grown from £24,071,000 on the 25th June, 1909, to £45,590,000 on the 14th June, 1912. I make an exception in favour of the gold standard reserve which represents nearly £18,000,000 of that amount, but the cash balances, irrespective of that reserve, have grown very steadily.
  The figures were set forth in the paper circulated by the India Office yesterday, showing that the balance on 31st March, 1908, was £4,607,000; 1909, £7,983,000; 1910, £12,779,000; 1911, £16,696,000; and 1912, £18,390,000. That is an extraordinary position of affairs. Most Chancellors live by borrowing, but with the India Office the reverse process is followed. These large balances create a bad impression in India, the impression that the poor peasants there are being unduly taxed, and give colour to the complaint that Indian revenues are being systematically underestimated and Indian expenditure systematically overestimated. Perhaps that is owing to the fact that there is no permanent European population in India to give that vigorous criticism to the Budget that it deserves. For whose benefit are these large balances accumulated here? Can it be claimed that they are for the benefit of India? The money is withdrawn from India, where some of it might be used to reduce taxation. It is lent to London bankers and approved borrowers at low rates of interest. The Government have been urged to make these surplus balances available to the public in India during the crop season. That was urged again on the 18th September, 1911, at the meeting of the Governor-General's Council. At that season the Presidency Bank rates for loans usually advance to 7 or 8 per cent.
  1292
  It was suggested that the Government should grant loans against the security of Government paper. What reply did the Government make? The reasons for a refusal are stated in the White Paper published yesterday, in which it is said:—
  "It is not the practice to lend to other institutions and firms in India."
  That is, institutions other than the Presidency Banks. It is something to be told that the Government's procedure is entirely hide-bound by practice, and that they will never make a new departure. What was the employment of Messrs. Montagu and Company but a new departure? The White Paper says that "they do not consider it desirable." That is no answer at all. The proposed borrowers are told that they ought to go to the Presidency Banks and borrow from them. There have often been times when the Presidency Banks either declined or were not in a position to lend on Government paper.
  The refusal to lend to the public in India is a very short-sighted action. It means a loss of interest to the Government, a loss of market and price for Government loans, a check on the free movement of crops, and a loss of benefit to India's trade. I see the extraordinary statement made in the White Paper that if loans were made by the Government upon rupee paper it would do harm to rupee paper. I can imagine nothing more calculated to help the Government issues of rupee paper. The banks would hold more Government paper as an investment during the monsoon months if they knew they could borrow on it freely from the Government. The removal of these balances to London from India for the benefit of the London Money Market has caused great uneasiness in financial circles in India. I have already referred to the Gold Standard Reserve. I do not wish to speak on that at any great length. The object of that is to maintain exchange at its present level. That Gold Standard Reserve is the key to the whole situation. There are two important things about it. All profits on the coinage of silver should go to it. They may all have to be paid away to the public irrespective of current liabilities. That has not been done. The coinage profits have not all gone to it; they have been diverted to other purposes, and I say that is utterly unsound and indefensible finance. The second point is that the gold reserve should be kept liquid, even at the cost of the loss

  1293
  of interest. It is most needed at times of disturbance and financial pressure, and in so far as it is not liquid and not available it is no reserve at all. It has not been kept liquid. The most liquid form would be gold, but we find it invested in depreciating securities. Nearly £17,000,000 is in sterling securities, a large part in Consols, and showed a depreciation a short time ago, when a valuation was made, of over £1,000,000 sterling. That is what happens in the time of our prosperity when all the land is blooming and burgeoning under the irrigating influence of the Chancellor of the Exchequer's finance. Imagine what would happen in the time of adversity, in the time of panic, and in the time when we were, perhaps, engaged in war, when the people were drawing money out of the savings banks, and when the whole of these securities had been thrown on the investment market. They would be practically unsaleable and the whole system of exchange would break down.
  Failure of rains or political troubles might easily overtake India and lead to an enormous strain on the reserve. I take the view that the bulk of this gold reserve ought to be in London, because it is in London it will be wanted to meet drawings from India in times of adverse trade conditions—in other words, to buy silver rupees from persons remitting home, giving gold in London. If any balances are to be kept in London—I would prefer' to see this fund kept here—and if any balances are to be lent to banks or approved borrowers, I would rather see the gold standard reserve balances lent to them than invested in depreciating securities. The only justification for putting them into depreciating securities is that gold produces no interest. That criticism would be gone if the money were lent on the London money market, when it would be in a much more available condition than if placed in Consols. The experience of 1907–8 ought to have taught the Government the inadequacy of the reserve. It very nearly broke down under the first moderate strain put upon it. If the adverse conditions had lasted a few weeks longer, or if the Indian public had lost confidence in the efficacy of the reserve to check the fall, and had begun to remit their capital home, the Gold Standard Reserve would have been completely wiped out and panic would have followed. Yet, with such a lesson before him, the Secretary of State actually fails to build up the reserve, and fails to see that it is put into
  1294
  a liquid form. Even the profit on bills sold by the Secretary of State to restore the Gold Standard Reserve after it had been depleted was actually added to the general balances of the Government of India. The hon. Member for Accrington (Mr. Baker) told me that was the usual practice. It was not the usual practice under a proper application of the system supposed to be in vogue. I fear that the hon. Gentleman did not sufficiently understand the significance of the course he was then advocating. Even since attention has been drawn to the diversion of profits on coinage and that bad finance has been stopped, we are told that the proper course is only going to be followed until the reserve reaches the sum of £25,000,000. No one can possibly say that £25,000,000 is sufficient. No one can say that £50,000,000 would be sufficient. Indian exports of merchandise increased in the last two years by £26,000,000, and £50,000,000 or £60,000,000 might not prove a sufficient reserve in time of strain; so that what is now being done by the Government is a mere pretence of doing the right thing. It is an utterly indefensible system of finance which treats the profits of coinage or exchange as available for purposes other than the reserve established to maintain the Exchange.
  There has been the most extra ordinary confusion with regard to the various reserves. We see the paper currency reserve which has to meet obligations which can only be demanded in silver largely held in gold. On the other hand, a portion of the Gold Standard Reserve is now systematically held in silver. This is sheer muddling. On 26th November I asked why the paper currency reserve was held in gold to meet obligations which can only be demanded in silver. I should like to give the answer, because it was an example of disingenuousness:—
  "It is not the case that the obligations against which the paper currency reserve is held can only be demanded or met in silver."—[OFFICIAL REPORT, 26th November, 1912, col. 989, Vol. XLIV]
  Observe the interpolation of those words "or met." That is not what I asked. Of course you can meet a silver obligation in gold at its face value if you wish to do so. You are entitled to pay rupees at ls. 4d. in gold, if you are fool enough to do so, instead of paying in rupees at the token value, which would only cost 9d.
  The present monetary system of India is based on the recommendations which

  1295
  assume the free coinage of gold. As far back as 1900 the Indian public were informed by the then Finance Minister that the Government intended to constitute a Royal Mint for the unrestricted coinage of gold in India. For reasons best known to themselves, that has never been done. Several questions have been put on the subject. We are told that there is objection to a Royal Mint. Why, I do not know. What about Australia? The suggestion is thrown out that the desire of India for a gold mint will be satisfied by allowing the coinage of a 10 rupee piece, or 13s. 4d. So far as I know, no one wants a gold coin of that sort. If you are going to give India a gold coin, why spoil it by giving a coin which will be very little known, whose international use will be greatly diminished, and which will be of no use outside India except as bullion, whereas sovereigns are used everywhere? The more we can make the British sovereign circulate the better. The advantage of the sovereign as an Empire coin is shown by the fact that a great many Australian sovereigns go to India every year, and many of them are passed on to Egypt. If you want to give the natives confidence in your gold standard you should have unrestricted coinage of sovereigns and half-sovereigns as you have here. That would strengthen their confidence, and it would enable the native, in a time of famine, to convert his gold ornaments without being subjected to the squeeze of the village jeweller. It would also mean that the profits of the assay and the refinement of the gold produced by the Indian mines would be retained in India. Mining would be encouraged and developed by the saving of freight and insurance and other expenses.
  I think enough has been said on this rather dry subject to show that there is a strong case for some kind of inquiry. I am only afraid, if it takes the form suggested by the Prime Minister, a good many years may elapse before any reforms are carried out, but there are many matters here which undoubtedly do call for investigation, not in any partisan spirit. I have not the slightest desire to make any party capital out of the questions. There is the question of interference with the automatic working of exchange; there is the question of speculating in silver; there is the injustice of handing over Indian balances to be played with here. Just imagine what Canada or
  1296
  Australia would say if it were proposed to deal with their balances as the India Office is dealing with the balances of India. There is the insufficiency of the Gold Standard Reserve, and there is its lack of availability in time of need. I do not think it is necessary to go into any other evil, especially evils of a personal character. There are subjects enough to justify an inquiry, and I trust that what has been said to-day by the Prime Minister will be given practical effect to at a very early date.
  The POSTMASTER-GENERAL (Mr. Herbert Samuel): As my name has been mentioned in the Debate, in terms to which I take no exception whatever, as that of a Member of the Government who is connected by ties of relationship with the members of the firm of Samuel Montagu and Company, I should like to be allowed to say just this: Without entering at all into the question whether or not the employment of that firm in the purchase of silver by the India Office was wise or unwise, or whether it was necessary or unnecessary, I should like, as a matter of personal explanation, to say I had no part or lot in it at all from first to last, and I was, as a matter of fact, totally unaware that there was any question of employing that firm, or that they were buying silver, until the purchase had been completed; and though no one, indeed, has suggested anything to the contrary, I thought it desirable, if the House would kindly grant me leave, to make that brief, explicit statement.
  Mr. MILLS: I do not propose to enter into the question of the method pursued by the Government and the Council of India for the purchase of silver, but I think the House will agree that this Debate, and the inquiry which gave rise to it, has raised the whole question of the financial relations between this country and India. Attacks have been made upon the policy of the India Council, mostly originating from outside the House. It has been stated in the Press that India is being bullied in her finance by this country, and that her commercial progress is being strangled by the selfishness of London financiers. These criticisms have, I believe, attracted great attention in India, and it seems to me that they may do a great deal of harm to our rule in India if the Government do not take strong steps to give them the freest possible discussion and notice here. Amongst other matters, a great deal of criticism has been directed

  1297
  against the size of the cash balances which the India Council keep in London and their method of employing them. These criticisms fall under two heads. There is personal criticism and criticism on the ground of policy. The first objection is that certain members of the Finance Committee of the India Council have lent part of the balances to firms with which they are personally connected. I do not wish to say anything on that, but I should like to say one or two words on the question of general policy. It has been asserted frequently in this Debate that these cash balances are excessive, and that they are employed in such a way as to be an advantage to the London Money Market, and a disadvantage to the taxpayers of India. May I deal with the second of these suggestions first? May I assume, for the sake of argument, that the size of these balances is justifiable and normal? If we take it for granted that it is right and necessary for the Government of India that you should have a balance of something like £20,000,000 in this country, the question arises how you are going to employ them. There are only two ways in which the India Council can possibly use these balances. Either it can let them lie idle in the Bank of England or else it can put them out at interest. I do not think anyone will suggest that it would be to the interest of the Indian taxpayer that these balances should be allowed to lie idle in the Bank of England. It is quite obvious that these very large sums bring in a very substantial revenue to the Indian people, and therefore, if they can be lent with safety, I do not suppose that anyone will object to their employment. The only question that remains is whether they can be employed with security and safety, or whether they cannot be.
  Before we discuss the question of how they are to be lent, it is essential that the House should remember the nature of these balances. They are not permanent balances in any sense of the word, but they are, as far as I gather, accumulations of weekly payments to the Secretary of State for India, with which he has to provide for large periodical payments in London. Therefore large sums of money have to be drawn from these balances periodically, and therefore it stands to reason that the balances cannot be invested in securities, but must be employed in some other way. If you have got large sums of money in your hands
  1298
  under these circumstances, the only possible place where you can employ them is on the London market. I do not think that is a matter of disagreement in any part of the House. That is exactly what the India Council have done. They have lent them to various discount houses and approved borrowers on certain selected securities, and as these balances have got to be kept in such a liquid state, and as they have got to be readily accessible at the required time, the question of security becomes of the very first importance. The India Council are in the habit of lending on Home Government securities and on India Stocks with the usual 5 per cent. margin, and this margin gives the India Council complete security. If the borrower were to fail to repay the loan at the required date the India Council would be able to sell the securities which it had in its hands and the 5 percent. margin would be ample to cover it against any possible depreciation.
  An HON. MEMBER: Not enough.
  Mr. MILLS: That is the almost universal practice in the City of London, and I do not think first-class securities, such as Home Government and Indian Government securities, are likely to have a greater fall than 5 per cent. while the Government have them on their hands. But there is another class of security which the India Council lend on, and their action has been a good deal criticised in this respect. They are accustomed to lend on short dated Indian floaters, that is Government guaranteed railway bonds without margin. I think the India Council were justified in this course. It must be remembered that the Secretary of State has to make a large number of loans during the course of the year on the London Money Market. It is therefore very essential to him that the credit of the Indian Government should be maintained and that Indian Stocks should be popular. One of the best ways of popularising Indian securities and keeping up their price is to make it to the advantage of the discount houses to hold these Indian securities because the Government of India will take them as security for loans and will take up this system of lending on these securities without margin in order to popularise Indian securities. I think they can do it in this case without any risk because these floaters are all short dated, and therefore in the event of the borrower not being able to repay his loan at the required time, the Government

  1299
  of India would naturally take the security, which would be repaid to them in full in a very short space of time. But of late years the situation has arisen that the Finance Committee of the India Council have been unable to lend the whole of their balances in this way because these balances have reached such a high figure. There are two main reasons why they cannot lend any more on the Money Market; first of all, probably because the large discount houses to whom they consider it advisable to lend will not take any more money, or perhaps the market, as a whole, has not got any more of the particular securities which they are willing to accept; because the India Council will only lend on selected securities, and I quite agree with the right hon. Gentleman (Mr. Bonar Law) when he says it would be extremely desirable for the India Council to enlarge the list of securities which they would take. For instance, I think they might with great propriety take first-class bills, as the Bank of England and all other banks, so far as I know, are willing to do as security for loans.
  8.0 P.M.
  The question before the Indian Government was how they were going to employ this surplus balance. It was suggested in this House, in a supplementary question, that the India Council should lend this money from account to account on the Stock Exchange. This rather horrified me because it is breaking the only principle upon which it is permissible in the interests of India to lend this money. You are not lending on first-class security. You are speculating. If you lend money in this way you are lending it on ordinary Stock Exchange securities, subject to immense fluctuations, and we all know very well that in time of panic, if the borrower fails and the India Council had to liquidate these securities, very likely he would not be able to do so at all, or, if he did so, he would sustain a very large loss. The only method that remains for the Indian Government is to employ its surplus by putting it on deposit with the London Clearing Banks. Three main objections have been stated to that method. The first is, that the interest is not high enough; the second, that there is no security given for these deposits; and the third, that the deposits are so useful to them that the banks would exercise undue influence on the India Council to increase the balances to such
  1300
  a size that they would have something over to lend to the banks. As to the first objection that the interest received by the India Council is not high enough, the House will remember that these deposits are only made for short periods, as the India Council has to recall them when they require them for their payments. Therefore the banks could only lend them in the short loan markets, or else by bills falling due on the same day as the loans. The banks cannot give the same rate of interest as they could do if the deposits were with them for a longer period, and if they could put them to more profitable use. Therefore the rate cannot be the highest rate. It has to be a rate at something approximating to the market rate of the day. We have heard it said that the India Council borrow at 3 per cent., and lend at 2 per cent. That is only half the truth, if I may say so, and it is rather a misleading way of putting the case. It is perfectly true to say that there were times when in fact it did happen that the India Council were borrowing at 3½, per cent. and lending at 2½ per cent. and under; but I think anyone who reads the financial articles in the "Times" will see that the India Council has a large amount of money out at 4¾ per cent. It is not a fair thing in making a case of this sort that that statement should be made. Everybody knows that no individual or Government can possibly borrow money for a long period, or even for a number of years, at the same rate as they could exact for loans and deposits of a few weeks run.
  Then, as to the second objection, that the India Council should not lend to the clearing banks without security, I do not think that has ever been seriously advanced by responsible people. The deposits in these banks amount to about £600,000,000, and an enormous percentage remains with them without security asked. It is because the public in this country believe the banks can repay these deposits that our credit exists, and that our trade which rests on that credit goes on. People who say that the clearing banks cannot receive £5,000,000, £6,000,000, or £7,000,000 without giving security for it, are attacking the very basis on which our credit rests. The third and last criticism is that this money is so important to the banks that the bankers in London would exercise undue influence in order to compel the India Council to pile up exceedingly large balances so that they might get some on deposit for themselves. This charge has

  1301
  not been made in this House actually, but it has been made in articles in the Press. I think people who say this seem to have a misconception as to the duty of a banker. After all, a banker deals in money exactly in the same way as a grocer deals in hams. A grocer's profit does not depend on the number of hams he has in his possession, but it depends on whether he can dispose of them at a profit. Some people have lost sight of the fact that these deposits are of extreme usefulness when money is tight; but it follows that because the India Council has £18,000,000 on the London money market money will not be tight, and that the banks will not be able to lend the money profitably, together with the rest of the money they have on their hands, in comparison with which the deposits of the India Council are almost insignificant?
  I have tried to show that, granted these balances are to be kept at this very high level, they have been employed by the India Council in the only possible and legitimate way. I am far from assenting to the view that these balances are normal. It seems to me that it is a question of Indian finance as opposed to English finance. I hesitate to express an opinion on the subject, but I gather from the White Paper and from speeches made by Members of the Government that the present size of these balances does not represent the settled policy of the Government, but are rather due to accidental circumstances such as the trade boom in India which has made the India Council think it right to spend a large amount of money on telegraphic transfers. Then there is the difficulty of estimating in advance the revenue and expenditure of India owing to the uncertainty of the harvest. There is also the fact that the India Council have raised loans, whether they are wanted or not. I do not know to what extent these circumstances are a justification of the Government or not. I would only say that anybody who looks at the fluctuations during the year of Indian securities, will see that it would have made a very great difference to the Indian taxpayer if the Government had not raised their loans at the beginning of the calendar year, but had waited until towards the end of the calendar year in order to make certain whether the money would be wanted or not. I do not know sufficiently of Indian matters to say whether that is an adequate justification of the action of the
  1302
  Indian Government. As to the selling of Council Bills and the business in telegraphic transfers, I quite agree with the policy to a certain extent. I agree that it is of inestimable benefit to the trader in India during busy times that these telegraphic transfers should be sold. It gives him the great advantage of turning over his money quickly, and of doing more business than would be possible if he had to ship the money over from England. The question is not whether Council Bills should be sold at all, but whether they should be sold practically without limit, and that is one matter which I think could be usefully discussed by the Commission the Prime Minister proposes to set up.
  I wish to refer to the question which was mentioned by my hon. Friend the Member for North Islington (Mr. Touche), namely, the Gold Standard Reserve. Articles have appeared on this subject in the Press which savour more of electioneering pamphlets than the serious discussion of an extremely difficult financial problem. Here again the Government of India have been accused of pandering to the interests of London financiers. I would like to examine the policy of the Government in this particular. I do not think it is necessary to discuss when and how the reserve was founded, but I think it would be as well to remind the House of its objects and nature, because I think a great deal of the attack is due to misapprehension of its functions. Many people seem to regard this Gold Standard Reserve as an ordinary currency reserve. Of course, it is nothing of the sort. The system we enjoy in India is not an ordinary gold standard, but a gold exchange standard. The object of the Government has been to maintain the value of the rupee by giving it a fixed relation to gold, and this is done by enabling India to meet her foreign indebtedness at a fixed rate of exchange between the rupee and the sovereign. The Gold Standard Reserve was instituted in order to maintain the stability of this exchange. We are told that because we do not allow India a gold currency and the free coinage of gold, we are therefore robbing her of her birthright. That may be very good oratory, but it seems to me remarkably bad finance.
  I think everybody will agree that a token coinage, if you have a decently honest Government, is quite sufficient to meet the needs of internal exchange, provided that you have assured the people that they will

  1303
  be able to meet their indebtedness in a commodity generally acceptable all over the world—that is to say in gold. This is exactly what you have done for the people in India by the Gold Standard Reserve. The Government of India can sell exchange on London at fifteen rupees to the £1, and therefore the Indian buyer can settle his indebtedness in gold in London. London, being the commercial centre of the world, that will allow him to settle his indebtedness in gold in Europe, America, or anywhere else. It seems to me that this is good for India and good for England. In bad times in India the price of the rupee will depreciate enormously, and, if there is a bad season there, exports will fall off, and therefore you would have an increased demand for sterling grants in India, and they would fetch more rupees, so that the value of the rupee in relation to gold would fall. Of course, it would follow there would be great loss to the people of India, and the people of England, and incidentally the Government of India, which has to exchange the rupee for gold. Anybody who looks at the Gold Standard Reserve will realise that it meets the requirements of India without a more expensive system of gold currency.
  I hope that the Royal Commission, when it is set up, will not listen to the type of argument we have had in these articles in the Press about India. I hope also if they deal with the question of gold currency they will consider it as business men and not on sentimental grounds. To my mind, the rupee is as good as the sovereign. I hope they will take into consideration the fact that Indian experts are very much divided as to whether a gold currency is wanted in India or not. I hope they will take into consideration the further fact that India already absorbs about one-third of the total annual gold production of the world. In spite of that, gold is not in general use in India. I would ask this question—if she absorbs one-third of the gold production without having gold in general use, how much would she have to absorb in order that she might have a gold currency, and would she not absorb so much as seriously to disarrange the whole international trade of the world? I do not wish to give an opinion about it, but it is a very serious question, and I hope that well-meaning enthusiasts will not attempt to settle it on grounds of sentiment instead of finance. It has been suggested by someone—I rather think my
  1304
  hon. Friend the Member for North Islington (Mr. Touche) held this view—that although the policy of the Gold Standard Reserve is right, yet the method of handling that reserve is wrong. It has been urged that this Gold Standard Reserve should be kept here in gold and not in securities, or alternatively that it should be kept in India and not here.
  My hon. Friend the Member for North Islington said that recent depreciation of securities in England has caused a loss of over a million pounds to the taxpayer in India, because this reserve was invested in securities here. I would remind him of two things. First, I am glad to say our present Chancellor of the Exchequer is not permanent. We shall not always enjoy the present system of finance, and I am confident that when we have got a more reasonable method of finance we shall not have this depreciation of securities, and therefore the Indian owner of these securities has perhaps passed through his worst time. Besides, I would like to point out that the statement is only a half truth, for, though it is correct to say that the depreciation of securities has entailed a loss of a million, yet the net profit, taking depreciation and interest together, to the people of India through this system of holding the gold reserve in securities here is something rather over £2,000,000. Of course this system does put upon these London financiers the responsibility of finding gold for the market price of these securities, but I do not think that the people who are always inveighing against the greed of the City of London as opposed to the poverty of the Indian taxpayer need worry their heads very much about it. The second objection is that this money should be kept in India. If it is kept in India it has got to be kept in gold, for it is obvious that it cannot be kept in rupee securities, which is all they have got. What is the result? I think my hon. Friend suggested that the proper function of the gold standard was to keep gold in India in order to be paid out to the people of India in exchange for rupees. It seems to me that the policy of our Gold Standard Reserve is rather to avoid anything of the sort, as this gold after all is not going to stay in India. It is going to be shipped to England. To avoid this, this system is set up. The result is that if this reserve is kept in gold in India it is obvious that this money is intended for bad times and not for good, because in good times the natural bulk of trade,

  1305
  being always in India's favour and against this country, automatically maintains the value of the rupee.
  But suppose you have bad seasons, that the crop fails and exports fall off. You would have people importing from England and a diminution of exports to England. You would have many people in India wanting to pay money in London, and you would have few people in London wanting to pay money in India. Therefore the Secretary of State here will not be able to sell his Council Bills except at a ridiculous price, because there will be nobody who wants them to pay debts in India, and the Government who are going to maintain the value of the rupee can only do so by selling exchange on London at the fixed rate of fifteen to the £1. What is going to happen is merely this, that this gold which was taken with such difficulty from London to India has got to be shipped all the way back to London before it can be of the slightest use to the taxpayer of India. If you have this reserve kept in London in gold and securities so that you can always meet any stress of this sort, I believe this principle is sound, but I do think it might be modified in the direction of giving the India Council a bigger hold of gold in proportion to their holding of securities, because their holding of securities is so large to my mind in proportion that it puts an extra strain upon the Bank of England and the City of London in time of great stress. I have only discussed a few of the questions of great importance to our finance, as this is, which have been discussed in this Debate, and which have been much discussed during the last few months. I do think that the policy of the Government has been rather obscure and uncertain. I do not in any way wish to make a party attack because I think that the main lines of Indian financial policy are agreed upon between the two parties however much we may disagree as to their application, but I think it is difficult to ascertain on what line of policy the Government do mean to proceed. I think this discussion has aroused a certain amount of interest in India, and the impression is being tried to be created there that we are exploiting India for our own benefit. That is a most undesirable impression to create, and it can best be met by the fullest possible discussion of these matters. Therefore I am extremely glad to think that the Prime Minister is going to set up a Royal Com-
  1306
  mission on which the whole financial policy of India may be thoroughly discussed and ventilated.
  Mr. BRYCE: In his very interesting and able speech the hon. Gentleman who has just sat down has so completely and so crushingly answered the complaints of the conduct of the Indian Government finance which were made by the hon. Member for North Islington that I do not propose to discuss more than one or two points to which he did not allude. I endorse absolutely every statement which has been made with regard to the finance of the Government of India by the hon. Member who has just sat down. The only statement which I do not agree with was when he appeared to indicate that the present low price of gilt-edged securities was owing to the management of the present Chancellor of the Exchequer. That was probably a jeu d' esprit to which he did not mean to attach very much importance. At all events, this is not the time to enter into a discussion of that rather thorny question. The hon. Member said that, according to his idea, there was only the one possible method of the Government of India treating these balances, and that was to keep them here. But the idea which has caused so much discussion and so much complaint in India, is that it might be possible to employ the balances in India and not here. I entirely agree that the proper place to keep the balances is here; but in India there is an impression among a certain school that it is very much more for the benefit of the people of India that the balances should be employed there. At the same time it should have been remembered that the idea has not received any substantial support from any substantial body of responsible opinion in India. The Karachi Chamber of Commerce has been under the influence of a gentleman who displays great ability and ingenuity in maintaining a particular thesis, but that thesis has not found support in any other responsible body in India. The Karachi Chamber of Commerce asked the Chambers of Commerce of Bombay and Calcutta their opinion with regard to the views which it held, and both those bodies not only indicated no sympathy, but indicated positive opposition to the views which the Karachi Chamber of Commerce holds under the leadership of Mr. Webb.
  I have absolutely no opinion in favour of the idea of keeping the balances there, and in India itself, discussions on the ques-

  1307
  tion with Indian merchants, and my own experience of India, which has extended over a number of years, teach me that it would be absolutely impossible for the Government of India to make as good a use of the balances in the interests of the people of India themselves as is the case if they are kept here. I notice that the hon. Member for North Islington did not seem to be quite consistent in different parts of his speech with regard to the possibility of employing these balances. At one time he seemed to indicate that it would be better to have them there in order to meet the trade requirements of India, and at another time he seemed to think it would be dangerous to have them there for that very purpose. I hold the view that it is not necessary for the trade purposes of India to keep the balances there at all. Those trade requirements are met with absolute satisfaction by the principle under which the Secretary of State meets the requirements for trade purposes, namely, the sale of Council Bills and telegraphic transfers. It he were to allow the adoption of other methods than those he now employs of furnishing the necessary funds, what recourse would the trade of India have. The only other possible method of getting the money necessary to move the crops at different seasons would be to import gold, but already the import of gold is an extremely serious danger for the world at large. If in addition to that we also added the maintenance of the gold standard in India, and if, in addition the money to move the crops had to be got in a form different from the present, the sale of Council Bills and telegraphic transfers, the amount of gold required annually by India would, instead of being something like one-third the gold supply, be something like two-thirds. Therefore, it is of the greatest possible importance that the Secretary of State should continue the methods which he at present employs.
  There was rather an interesting illustration why certain parties favour the idea of employing the balances in India, and it is the fact which has not been mentioned so far in the House that the Indian Specie Bank actually used the money of the Government of India for the purpose of making these large purchases of silver, by means of which they drove up the price of silver against the Government of India. The Government of India had a large deposit with the Bank of Bombay, who lent money to the Indian Specie Bank, who used it to
  1308
  purchase silver, and so drove up the price of silver against the Government in India. There is no market in India in which money can be lent, save on securities, in a shape which it would be absolutely impossible for the Government to accept. The idea of employing the Government balances in India is an absurdity. If they did use them there the value of money which is at present on the average rather higher than the value in London, would fall below the level of the Money Market here, supposing the balances continued as they are at present. I noticed a case this morning of the violent fluctuations which take place in the money markets of India. The rate of the Bengal Bank was at 8 per cent., and today it is at 7 per cent., and money is really not lendable in India at over 5 per cent. The reason of that is due to the failure of the autumn rains in the Punjab, with the result that the supplies of wheat have been very small and exports from Karachi have in consequence ceased.
  This may seem a small factor in the movements of a great market, but, it is a factor which effects the value of money in Calcutta and in Bombay to the extent of no less than 2 per cent. in the course of a short time. I want to particularly back up the suggestion made by the hon. Member for Uxbridge (Mr. Mills), namely, that the reference to the Royal Commission should include the whole question of the employment of gold in India and the coinage of gold in India, in addition to the subjects mentioned by the Prime Minister. It is important that the Commission should inquire carefully into these matters with a view to prevent a sudden drain of gold into India, which would be a very serious danger to the welfare of the whole world. The reference also should deal with the question of the possibility of minting gold for India. These may appear to be comparatively small points, but they are of surpassing importance. The Government of India may have been unduly cautious, but I remember regarding with the utmost anxiety the new start they made twenty years ago with regard to establishing a gold standard for the rupee. I thought it would inevitably break down, and at that time there was just the same cry against the Government that there is now as to the inalienable right of the people of India to have three coins of gold. I have been astonished at the manner in which the Government of India, in very difficult times, and on numerous occasions, have

  1309
  managed to steer their barque through the whirlpools with which they were surrounded. So far from there being any ground of complaint as to their conduct of the finance of India, all the monetary authorities of the world feel universal admiration for the way in which they have performed their task.
  Mr. BIGLAND: I, for one, am exceedingly pleased that the Prime Minister has been willing to indicate that he would go further than the Member for Eastbourne (Mr. R. Gwynne) in his request that a Select Committee should investigate this subject of Indian finance. I feel that we are indebted to the Prime Minister for rightly apprehending the feeling of this House, and I believe the feeling of the country, that not only is it desirable to have a Select Committee, but that it is desirable to have a Royal Commission to look into the matters which have become not only vital to us as a commercial people, but also vital to the whole of the business world. I am not one of those who seek to criticise the Government with regard to the way they have conducted the purchases of silver if they consider for a moment that their first duty is to buy that silver at the lowest price. If I, as a manufacturer or consumer of raw product wished to obtain at any given moment a very large quantity of any raw material to use in my manufactory, then the policy that the Government have lately followed would be exactly the right policy. The question I wish to put to the hon. Gentleman opposite is, has he apprehended the wide view that ought to be taken with regard to these purchases, not to obtain that silver at the lowest price, but to have in his mind the effect of his action as the dominating factor to settle the exchange of millions of people all over the world. If I am right, the duty of the Government was not to think whether they could save £170,000 in the actual price they paid for a metal, because that is what silver has become, and it is treated to-day just as pig-iron or any other metal. I was one of those who thirty years ago, when the bimetallist matter was fought out, was absolutely against any talk of bimetallism. I believe in the idea of monometallism. One great banker in Liverpool—I refrain from mentioning his name, and he has passed over to the majority, who had also been a banker in China and in India, and had come home—said to me twenty-five years ago, "As sure as you find ninety-five to one hundred millions sterling of
  1310
  gold obtained out of the earth per annum, then the question will be for ever settled of the possibility of getting bimetallism to come back to settle the currency of the world."
  I have watched that prophecy for a long time, and to-day the hundred millions that he foretold has come about, and there would be no possible need of us discussing this question of silver with regard to India if a certain thing had not happened. That certain thing was the action of the Indian Government in fixing the rupee value at is. 4d., and refusing the free coinage of silver. After the first famine, as I understand it, the position of India was this. That the natives brought in their silver bangles and ornaments to the silversmith and asked for them to be converted into rupees, but they were told that the action of the Government had prevented that. For generations prior to that Act being passed, it had been the habit of the natives in times of distress to bring their silver bangles and ornaments of all kinds to the silversmith and obtain rupees at a fixed value. That having ceased the native was told by the silversmith, "From now and for ever you must cease to hoard silver, and all your reserves must be gold." They never bank in India; they keep their savings in their homes; they hide them or put them on their wives, in bangles on the wrists, or on the ankles in the way of ornament. They were told by the silversmiths of India, "From now and for ever you must only hoard gold, because gold would never change in value, so that whenever the time of trouble comes you can bring your gold to us and we will give you cash equal to a fixed value." From that date there has been a tendency in India to discard the hoarding of silver and to begin to hoard gold. We who study these questions of the values of produce the world over, relative to their exchange value, have been horrified to find that these 300,000,000 of people, having been taught by their silversmiths, whenever they realise over their needs more than the actual needs of their family, leaving with them the difference which was their property, to put it into gold reserve in the form of either ornament or coin and hidden away, that that action taken by so many millions has resulted in the drawing out of the world, as the last speaker has said, of one-third to one-fourth of the total annual production of gold. We stand today in a state of nervous tremor as to whether that will go on and increase.

  1311
  The production of the gold of the earth is roughly ninety-five millions per year. We estimate that thirty millions per year is used in the arts and sciences, which leaves sixty-five millions available for currency, but if India absorbs thirty millions out of the sixty-five millions then you have only thirty-five millions in gold to be distributed amongst all the great countries of the world to arrange for their increased volume of trade and to be the basis of their currency and their exchanges. This is a vital issue for all of us, and I sincerely trust that this Royal Commission which is about to be appointed will have the power given it to investigate the whole issue of this matter of exchange because, if I understand the position aright, the people of India's interest and the people of England's interest are absolutely antagonistic. It is to the interest of the people of India that the exchange should fall because then when they sell their linseed or cotton or wheat or whatever it may be, they, as it were, receive a better price for their product. When the Lancashire spinner tries to sell his calico goods in India, if the rate of exchange goes up, then the Lancashire man's interest is diametrically opposed to the agricultural interest of the farmer of India. It is for the Government to find the absolute stable position between both parties and to act fairly. To my mind the action of the Government was wrong in refraining from buying silver for five years, and after that period of five years to enter the market as an enormous purchaser. The result has been a very serious loss to many thousands of innocent traders. I have only to quote my own case. I am trading to-day in a commodity for Manchuria. I did not know a year ago that the Government of this country were going to start buying an enormous quantity of silver which would alter the whole rate of exchange with regard to the whole of the Eastern produce of the world coming to the Western markets.
  I say that all the citizens of the Empire have a right to know what action the Government are going to take if it will affect the course of exchange. The Government, when they apprehended that there must of necessity be an increase in the coinage of India, should have come honestly into the market and said, "For the next twelve months we will require 8,000,000 ounces of silver per month, and we are prepared to receive tenders." Or
  1312
  they might have said that they had decided to buy so much silver per month, and allowed the market to take its natural course. In the first instance they would have lost money. But I know, as a large operator in the produce markets of the world, that if the largest buyer's requirements are less than the market expects, if he names a requirement for a price for twelve months, the market will anticipate a fall, break the market for him, and tender below the cash price to get the twelve months' contract. So that while for one twelve months the Government might lose money by exposing their hands, in the next twelve months it is quite possible that, with an increased production in silver, they would actually cause a break in the market by saying, "This year we will require only 5,000,000 ounces per month," whereas the year before they had asked for tenders for 8,000,000 ounces per month. Secrecy in the market where a nation is engaged is not the first item to be considered. Whatever happened, the Government had an enormous profit between the price they paid for the silver and the price at which they issued it as coinage to the people of India. They had a fabulous profit, and it did not matter much to the finances of India whether or not there was a penny per ounce difference.
  I claim that it is up to the Government of this country so to act that every individual trader in the Empire can know and judge for himself whether the requirements of the Government will increase in such a way that in the contracts that he makes for the ensuing twelve months he must allow for an advance in the exchange of the world. Thousands of men in different parts of the world, in arranging their business, as they have to do, for months ahead of the actual day to day business, have to calculate this question of the price of silver. It is rather ironical to take up a paper written a short time ago to a former Member of this House, Mr. Morton Frewen, by one of the Senators of the American Parliament, on this very question of silver, before the present issue was at all before the country, and to find that this Senator seemed to have foreseen just what has happened. He says:—
  "But that a great civilised Government should be making a profit as to-day of 50 per cent. by selling currency of unlimited legal tender to 300,000,000 of its citizens, that the currency of India should be manipulated as to-day by a few officials whose purchases or non-purchases of silver bullion elevate or depress all the world's exchange with China—this is so opposed to every theory of your own economists that I must not venture to press the point further."

  1313
  This Senator was on a Committee appointed to consider the possibility of America, England, and Germany uniting to find some possible way out of this difficulty with regard to silver exchange, and to bring about to some extent some balance or equivalent between the silver and gold exchanges. He was unsuccessful in his efforts, because it was found that the interests of the Government of India, acting for the people of India, who wish to ship their goods to these three great buying markets, were entirely at variance with the interests of the people of the United States, Germany, and England, who wish to ship goods to the Indian market. It is up to the Commission which has been proposed by the Prime Minister so to consider the conflicting interests of the people of India and of the people of these great trading nations that some way shall be found to prevent a 50 per cent. rise, such as the hon. Gentleman has told us took place in silver between 1902 and 1912. It is awful to think that the basis on which the exchange transactions for half the people of the world are taking place fluctuates 50 per cent. What should we think if the value of the sovereign fluctuated nearly 50 per cent.?
  We have the admission of the representative of the Government that during ten years the value of the basis of exchange for half the people of the world fluctuated 50 per cent. Cruel injustice must have been done during these violent fluctuations, and it is for us, as the greatest trading Empire in the world, to endeavour to make it possible that this exchange shall remain steady, so that the people, both buyers and sellers, shall have some even basis of exchange. This Debate will have been of the utmost value not only to us in this country, but to the people of China, India, and all the trading communities of the world, if through the effort we have made there is appointed a Royal Commission which hears evidence and devises some way out of the difficulty, which threatens to be one of the most serious dangers that the trading community of the world has ever had to face. One cannot conceive What might happen if on the present basis of gold reserve the great trading people got nervous and asked for their gold. It would create such a panic in the world as we business men have never seen. It is to the vital interests of the trading community of this country that the Government have agreed to ap-
  1314
  point a Royal Commission in order that this question may be investigated and, I sincerely trust, solved.
  Mr. COTTON: I would call your attention, Mr. Deputy-Speaker, to the fact that we have not got a House.
  Mr. DEPUTY-SPEAKER: The House cannot be counted at this hour.
  Sir GEORGE SCOTT ROBERTSON: I agree with the last speaker in the pleasure with which I heard the announcement of the Prime Minister that he intended to have a Committee, or more than that, a Royal Commission, thoroughly to examine many of these questions which are agitating the minds of people at the present moment. But I want, in a few minutes I shall speak, to put the point of view of the Indian taxpayer, the ryot. In the beginning of this Debate nobody referred at all to the Indian taxpayer, either directly or indirectly, until the Prime Minister made his speech, and since then, with one or two exceptions, no other references have been made to the people of India. The last speaker also was so overwhelmed with the importance to the world at large—and I admit it is of very serious importance—of this particular question of the gold absorption by India that he looked at it entirely from the Western point of view which causes so much agitation in India at the present time. That is what the Indian people accuse us of doing; of sacrificing their interests to the Western or other point of view, and not looking at the case from their point of view. Indian opinion at the present time is perhaps somewhat hard clearly to define. We know, for instance, that the Indian commercial community, the Anglo-Indians, are quite satisfied with the present condition of the cash balances.
  There is one exception, and one which the hon. Member who has just sat down knows perfectly well, and that is the Karachi Chamber of Commerce. That chamber proposed to other Chambers of Commerce in India that there should be a joint protest against the amount of the cash balances which remained in this country, and all of them unanimously disagreed. They pointed out the convenience it was to the Indian trader. As to the absorption of gold in India, of course, the circumstances are peculiar at the present moment in the enormous exports from India compared with her imports. Gold,

  1315
  of course, goes to India, and the hon. Member, I think, imagines that it is all absorbed. Large quantities are, no doubt, but some part of that gold finds its way into the Treasury. Just, for instance, see how enormously the gold has increased in the paper currency reserve of the last two years. It now stands at £18,000,000. In the last returns of the currency department, we find that although over eleven crores of rupees in gold were absorbed, there was also an equal quantity of silver absorbed. The true inference from that is this: that the people of India in the last two or three years have increased very greatly in prosperity. That is the meaning of it. Gold is used very extensively in India at the present time. The Commissioner for one of the Punjab Divisions says that the gold paid out from the Treasury there is returned as land revenue by the people. We know that the Punjab wheat is moved very greatly by gold, and we know that in Bombay remittances are sent up country in gold. Gold is making way.
  9.0 P.M.
  The question of the absorption of gold will be one of those very interesting questions that will come before the Royal Commission. Anything one states now is, of course, of comparatively little value. It is a personal opinion. What one wants is an authoritative Royal Commission of experts who will take all the evidence, and from their standing and position in the political, scientific, and commercial world, will be able to give some sort of a decision which may be, we hope, authoritative. There is not the slightest doubt now that the Fowler Committee is altogether out of date. You will, of course, find that Mr. Webb, of the Karachi Chamber of Commerce, and his supporters, quote the Fowler Committee almost as if it was inspired doctrine. It is fourteen years old. It attacked problems experimentally. Obviously, conditions have changed very much. Now these questions should be thoroughly examined, especially from the point of view of the Indian people. They feel very strongly that their interests are being sacrificed to those of the Occidental world. It is important that they should be disabused of any feeling of that kind, and also taught, if possible, that the relation between the Eastern and the Western in trade is mutual, and that there can be no disaster, for instance, to the West with-
  1316
  out it eventually falling also on the East. The Gold Standard Reserve is another question which would be referred to this Committee for very careful examination. Expert evidence would be collected. I am not going over all these questions in detail. They have been so excellently and thoroughly dealt with that it is not necessary to do so. But I would just like to say a word or two about the opinion of India upon this silver question and the methods of the Secretary of State in dealing with the silver question. The "Times of India," which especially devotes itself to this question—and with great impartiality—has pointed out, very truly, how unimportant these, I had almost said, sordid squabbles between bullionist brokers are from the Indian point of view. They say, in effect: Supposing all that has been alleged (and which, by the way, has been withdrawn) had been true, what does it matter to us? We want the great questions settled. We want the question of the cash balances settled. We also want settled this Gold Standard Reserve, and all the great and important questions which bear specially and peculiarly upon the Indian taxpayer. These are the questions which have to be determined and desided upon.
  The "Statesman" and, in fact, all, I think, of the Anglo-Indian newspapers, apart from the "Times of India," are agreed that there was an iniquitous conspiracy from one point of view, and a perfectly justifiable commercial combination from the other point of view, to corner silver. The "Statesman" waxes very sarcastic on this subject, and says: You want to proclaim, of course, on the housetops that you are going to buy silver so that a ring of gamblers may feather their nests at the expense of the English taxpayer. That is really what the Secretary of State, with the help of the Indian Government, set himself to prevent. I congratulate him very heartily upon his success. I do not agree at all with the remarks made which seem to imply that he failed. On the other hand I think the more carefully you examine the correspondence and the more you study the opinions of the experts, the more you will find that Lord Crewe's estimate is not very far wrong when he stated that hundreds of thousands of pounds sterling have been saved to the Indian taxpayer by these secret purchases. I will not refer to it any more. The whole question

  1317
  has been very thoroughly threshed out, and I merely say this, that, speaking from the point of view of the people of India, watching with wonder and some suspicion the curious controversy going on in this country, I am most glad and am extremely grateful to the Prime Minister that he is going to set up this authoritative Royal Commission so as to allow these people to know everything that can be said on the one side or the other.
  Colonel YATE: I wish to say a ward or two upon one point and that is in connection with the India Office balances and with the management and administration by the India Office of these balances. The right hon. Gentleman the Prime Minister explained to us how largely these balances had increased during the years 1909, 1910, 1911, and he went on to tell us that the reason they had increased is explained in this White Paper. Everybody will be glad to think that the Royal Commission will give a very much more weighty and authoritative explanation than is to be found in this White Paper. These balances are raised—the words here "are supplied"—almost entirely from the proceeds of the sale of weekly Council Bills, and as the hon. Member for Uxbridge said these bills have been sold during the past three years practically without limit. Is that policy of selling Council Bills without limit to continue or not, or is it to be set aside? I called attention to it first of all in the Budget debate last year in this House, and I brought to the notice of this House how the cash balance in 1907, the year after the present Government came into power, was only £4,600,000, and that this had increased gradually to £7,000,000, £12,000,000, £16,000,000, and last year to £18,000,000. I pointed out that according to the Budget statement of the Secretary of State the amount required for India in England amounted to about £16,000,000 or £17,000,000 a year, and that the Secretary of State had been drawing for the last few years from £25,000,000 to £27,000,000 annually from India, and had apparently started banking on his own account with the balance in England. I said I did not think that was ever done before.
  I asked the Under-Secretary to try and explain it, but he could not do so at that time. I followed this up on 3rd September last by asking a question of the hon. Gentleman representing the Secretary of State for India in this House as to whether the Secretary of State made these
  1318
  loans to banks and firms from balances through a full time paid official without the intervention of any person carrying on any form of financial business. I was told the answer was in the negative, and that loans were made by the Secretary of State's broker. I put further questions as to what was the percentage or commission of the Secretary of State's broker, and I was informed that the figure was fixed at 1 per cent. on deposits and on loans 2½ per cent. up to £5,000,000, and 1½ per cent. beyond that. Later on I found out from the Return issued that the percentage paid to this broker during 1908, the year after the Government came into office, was only £2,642, that in 1909 it was £6,300, and that in 1910 it was £12,700. That seems to me a very large amount to pay. And the question arises, what was the necessity for all these great payments to the broker? The Prime Minister told us that the Secretary of State in Council had to rely upon the advice of his expert advisers at the India Office on the Indian Council, and the Prime Minister gave us the names of the Finance Committee of the India Office Council, and the names he gave us were: General Sir Charles Egerton, Sir Theodore Morrison, and Mr. Krishna Gupta, in addition to Sir Felix Schuster and Mr. Lawrence Currie. I venture to ask, why is it that upon this Finance Committee of the India Office Council no advantage has been taken of the expert finance Ministers that India has possessed for many years passed.
  We have had many eminent finance Ministers in India, and not a single one of those are on the Indian Council. We have Sir Charles Egerton, a famous general, who spent all his life in India, but who does not possibly know any more about finance than I do. We have Sir Theodore Morrison, who was a professor of a college in India, and who looks after Indian students in England, but I do not suppose he knows much about finance. We have Mr. Krishna Gupta, an eminent member of the Indian Civil Service, who, if I remember aright, wrote a very able treatise upon the fisheries of Bengal, but who has no knowledge of finance or banking business in England that I know of. I hope the present Royal Commission will go into the question as to the administration of the funds held by the Secretary of State. I should like to ask why is it that no finance Ministers who have returned from India at the end of their service are appointed to the Finance Committee of the India

  1319
  Office? These finance Ministers have had great experience. They come to England at a comparatively early age. Indian Civil servants retire at fifty-five, after thirty-five years' service A man goes out to India at twenty, and comes home at fifty-five. If he goes out at twenty-two or twenty-three years of age, he comes home at fifty-seven or fifty-eight. All these experienced finance men come here, and why is it that the Secretary of State never appoints any one of them to his Council. Instead of that he appoints upon the Finance Council an Army man, a schoolmaster and a Fisheries man. I say that is not financial business, and I trust that the matter may be raised before the Royal Commission, and that some better and more suitable arrangement may be made for the administration of its finances by the India Office.
  Mr. MacCALLUM SCOTT: I would like to join in the expressions of regret that the Under-Secretary for India is not here. I am sure the House would have benefited very greatly from his assistance and intervention in the Debate. The ability and knowledge he has displayed in Indian matters, and, still more, the sympathy with Indian opinion that he has displayed on many occasions make him conspicuous among the list of those who have occupied office in respect to India in this House. I would like to assure him if he were here, on the part of those who have watched his career with a somewhat critical eye that with regard to the attacks that have been made upon him and his family he has our entire sympathy and confidence and respect. I have listened very carefully to this Debate with a view to gathering what are the main lines of attack and criticism upon the India Office. As far as I can see there are two main lines. First of all there is the attack presented by the hon. Member who moved the Motion now before the House which was purely personal; and in the second place there was the criticism based upon the very broad lines of financial policy which was voiced by the hon. Member for Islington and others, but which has been more largely voiced outside the House, the chief exponent being Mr. Webb, the Chairman of the Karachi Chamber of Commerce. This Motion is one which raises questions of a broad general policy, and it is one asking for the appointment of a Select Committee. In the speech of the hon. Member who moved it there was an entire absence
  1320
  of any criticism in regard to the broad financial policy of the India Office, and he concentrated his attack, which was entirely a pure personal one, upon one particular contract. He did not deal with the general financial policy either in India or in London, but he dealt entirely with this one contract, and the whole of his case was that this was a corrupt bargain between the officials of the India Office and this particular firm, and he charged this firm with not having acted in good faith and with having deceived the India Office as to the nature of the transaction. But the hon. Member did not make his charge definitely or openly, and he always withdrew when there was any suggestions as to the real nature of his charge. At the same time the hon. Member said he was not making any charge of corruption or undue influence, but his attitude was very much like that of the numerous critics who have recently collapsed in the Marconi Inquiry. Practically the charges were hinted and suggested in the same way by the hon. Member. Going outside I might refer to an article I have found in a paper which circulates in South Hackney. It is called "Our Flag," and contains an article by "Rupert Gwynne, M.P.," and in it I find the real gist of the charge which the hon. Member is making. He says:—
  "From time to time it is necessary for the Secretary of State for India to buy silver for the Government for the coinage of rupees. Hitherto the practice has been for the Secretary of State to notify to the Bank of England the sum required. The Bank in return has instructed a firm of brokers to make the necessary purchases. This year the Secretary of State for India departed from this practice and instructed Messrs. Samuel Montagu and Company to make the purchases. The close relationship of the Under-Secretary for India and the Postmaster-General with this firm is shown by a glance at the genealogical table below."
  This article is illustrated with a genealogical table, showing the descent of the members of this family for many generations. A little lower down I find the following passage:—
  "No one in the silver market would think that the Government would have the audacity to take the work away from the Bank of England and place it direct with the firm of Messrs. Samuel Montagu and Company."
  What is the meaning of this genealogical table inserted in this financial article like a table of statistics if it is not a charge of corruption? The hon. Member in his long speech dealt with no question of general financial policy, although there are many such questions which might have been raised. There is the question of the establishment of a mint in India, the gold currency reserve, the question of the balances which are retained by the India Office in

  1321
  London, the sale of Indian Bills, and telephone transfers in excess of the India Office requirements, and the issue of the balances in the way of loans. All these are important aspects raised by this Motion, but which were not glanced at in the speech of the hon. Member who moved it, and he confined himself entirely to this one contract and to the family relations of the firm, which was the principal in this contract. The speech might have been made by one absolutely ignorant of Indian financial problems, because it showed no knowledge and threw no light upon any of these questions. The hon. Member's financial lexicon seems to consist simply of Burke's Peerage, "Who's Who," and Dodd's Parliamentary Companion. The hon. Member was—
  "'Willing to wound and yet afraid to strike,'"
  and his charges have found form outside this House. I will quote a passage from the "Pall Mall Gazette" for 31st October last:—
  "It is quite evident now that the scandals of India Office finance going to be brought into the light of day. Only an Edmund Burke could do full justice to their magnitude. The venality of the Nabobs of an earlier era, the evils of Tammany Hall, the revelations of Radical rapacity in other directions in recent years, all became insignificant when compared with the vast and impudent perversities which have been organised in Whitehall in the last six or seven years."
  A little later on the article says:—
  "Sometimes institutions and corporations have derived benefit, while the individuals really concerned are in the background. At other times the 'benefits' have been more directly individual."
  And the last sentence is:—
  "We repeat, that this is going to be a very nasty business."
  That is, put in somewhat more lurid and highly coloured language, the charge suggested throughout the whole speech of the hon. Member who moved this Motion. What is the answer to these charges? I think it is both complete and satisfactory. An answer has been made from the Front Bench already, and I will not go into the question in detail. In the first place, the purchase of silver through this particular firm was a transaction which was for the direct benefit and advantage of the Indian taxpayer and Indian finance. It defeated a ring of speculators—I do not mean to cast any aspersion on them whatever, because they were engaged in a legitimate transaction—who were rigging the silver market against the Government. This transaction over the whole series of purchases has led to a saving of hundreds of thousands of pounds—at a minimum estimate £175,000—and possibly reaching to many
  1322
  times that sum. That is the first answer as regards the particular transactions. Now as regards the firm itself and the relationship of the Under-Secretary to that firm, there are two points to be noticed. First, the Under-Secretary is not himself a member of that firm and has no financial interest in it; and, in the second place he is not a member of the Financial Council at the India Office. He has no part in its deliberations, and had no share in and
  was not responsible in any degree for its decision to give this particular contract. I would like to quote the words of Lord Curzon in referring to the relationship of the Under-Secretary to the Financial Council. In the Debate in the House of Lords, on 14th November, he said:—
  "We know from what we have heard to-night, that he is not even it member of the firm for which his brother has spoken, and I can state from my own experience of the India Office—I was Under-Secretary there myself—that the Under-Secretary has nothing to do, or next to nothing to do, with the Finance Committee."
  Leaving altogether apart the suggestion of corruption and malpractice and undue influence, we come to an aspect of the criticism which was mentioned by the right hon. Gentleman the Leader of the Opposition. I frankly recognise that he dealt with the whole subject in a thoroughly proper and unexceptionable spirit. I take no exception, and I think no one on this side of the House takes any exception, to the tone or nature of his criticism in any respect. He said: "It may be all very well in business to benefit your friends, to put something in the way of your friends, but it ought to be the opposite maxim which prevails in politics. If those who have political power and influence have got friends or relatives in business they ought resolutely to avoid having any financial dealings with firms with which their relatives are connected." I agree. That is a sound general maxim, and it ought always to be followed unless there is some good, definite, urgent reason to the contrary in the particular case, and in this particular case it is submitted there was an overwhelming reason to the contrary. The Government was faced with this ring of speculators in silver. The only way of defeating it was to find some firm not in touch with it which could act quite independently, and it so happened that out of the four firms which were available this particular firm was the only one which could enable the Government of India to break down this financial ring. In these circumstances, I think everyone who looks at the subject with an impartial

  1323
  and unbiassed mind will agree with the view Lord Crewe expressed in the House of Lords in the same Debate. He said:—
  "The facts being as they are, I cannot think that we should have been right in obedience to a possible prejudice against the blood relationship of the Under-Secretary and the head of the firm, to have sacrificed this great benefit, although I entirely agree that in such matters appearances are important and cannot altogether be ignored."
  Mr. CASSEL: Is the hon. Member in order in quoting from the speech of a Noble Lord in another place?
  Mr. DEPUTY-SPEAKER: I think the hon. Member is not quoting the speech in the sense in which it is forbidden in this House, namely, to make an attack upon a speaker in the other House, who is not here to reply. The quotation did not appear to me to be of that nature at all.
  Mr. MacCALLUM SCOTT: I am sorry if I have even seemed to be out of order. I will leave the purely personal aspect of the case, and come to the more substantial case which has been presented against the financial policy of the India Office. That case had been chiefly worked up and published through the activity of Mr. Webb, the chairman of the Karachi Chamber of Commerce. He may be said to be the only public man in India who has taken that view, and the local newspaper of his district has referred to him as carrying on his agitation single-handed. Then there was the series of articles in the "Times" of last November, which were said to be by an Indian correspondent. I think we may not be far wrong in tracing the inspiration of those articles to somewhere about the region of Karachi. What is the gist of that criticism? It is that the India Office has departed altogether from the principles laid down by the Currency Committee; that it has refused to establish an Indian Mint; that it has refused to take measures to promote the circulation of gold in India and the import of gold into India; that it has invested the Council Reserve in silver and securities instead of keeping it locked up in gold; that it has maintained cash balances to an inordinate degree in London; that it has sold bills and telegraphic transfers far beyond its requirements, and that it has been lending these cash balances in London at a small rate of interest, instead of using them in India. That is substantial criticism. There is a substantial case on which I frankly
  1324
  do not pretend to form a definite and conclusive opinion for myself. These are very highly technical matters on which no Member of this House has a right to speak without knowledge and very prolonged experience and study of these questions, and for my part, having Ministers on the Front Bench who enjoy the confidence of this House and who are advised by highly trained experts in Indian affairs, I am quite prepared to accept their assurance that the policy of the India Office on these matters is sound and in accordance with the best interests of India.
  There are two aspects of these technical charges to which I think an ordinary lay Member may make some reference. The first is that this criticism of Mr. Webb, which took the form of a series of articles in the "Times," is not endorsed by the "Times" newspaper itself. The "Times" newspaper expressly dissociated itself from the view expressed in these articles. The criticism of the "Times" is of quite a different nature; it is more of the nature of that which was put forward just now by the hon. Member who preceded me. It is a criticism about the constitution and manning of the India Office; it is as to whether it is well manned. There is much to be said in support of the overhauling of the India Office, just as much as there is to be said in favour of the present overhauling of the Civil Services of this country and of India by Royal Commissions. I would have been very glad if the Prime Minister, when he made the announcement of a Commission of Inquiry to-day had made some announcement also that the India Office shall he subjected to the same process of rigid examination and criticism that other Civil Services are being subjected to. My next point is a different one. These articles purported to represent Anglo-Indian opinion, but it is obvious to anyone who has studied the Anglo-Indian newspapers that they completely misrepresent Anglo-Indian opinion. I will call attention to one of these articles published on 4th November to show that a claim was made that they represented Indian opinion:—
  "But the Government's constituency extends far beyond the purlieus of India, and embraces the whole of India. There, wherever the financial question is understood, wherever large industrial and commercial interests are centred, there is deep indignation at the manner in which the resources of a poor country are diverted to feed the money interests of the wealthiest city in the world."
  And here is a second quotation:—
  "The interests of these banks are bound up with cheap remittances to India; it is nothing to them if

  1325
  Indian interests suffer or if the Indian taxpayer pays. Small wonder is it, if, ground between the joint stock and the exchange bank Indian interests have been reduced to powder and she has been compelled to see her resources diverted to the bolstering up of depreciated securities, to financing the city and frequently to arresting the natural flow of bullion to her shores."
  There you have a direct claim that they represented practically a unanimous Indian opinion, and now I come from November to January, and here I have a "Times" article containing a review of Anglo-Indian opinion based upon an examination of the files of the Anglo-Indian newspapers for the three previous months. It is dated the 20th of January, and refers to the series of articles published in November last. It says:—
  "Generally it may be said that careful examination of the tiles of the principal Anglo-Indian newspapers for the last two or three months shows that while the views of our Anglo-Indian correspondent have altogether failed to secure widespread support, our contention in connection with them that the whole problem of Indian financial management should be re-examined by an independent and representative commission, is supported in influential quarters and is not contested by any important organ of Anglo-Indian opinion."
  It is clear that this criticism, whatever it may be, represented the views only of a few isolated individuals in India, and did not represent views of the Indian commercial community to any appreciable extent. My last remark is this, that this criticism, the manner in which it has been presented, the charges and insinuations which have been mixed up with it, must have undoubtedly have a dangerous and perhaps disastrous effect in India. The hon. Member made charges of corruption. It would be a disaster to this country, a disaster to India, and a disaster to the Indian Government, if the people of India were ever in large numbers convinced that their Government was a corrupt Government, and that their resources were being squandered in the financial interests of the City of London, instead of the interests of the Indian taxpayers being the first consideration of the India Office. If the hon. Member who moved this Motion believed in those charges which he insinuated—
  Mr. GWYNNE: I made no insinuations. I made direct charges in certain cases. made no charges of corruption.
  Mr. MacCALLUM SCOTT: I think the hon. Member was absent when I examined the whole case which he made, and I think I showed successfully that he had insinuated charges of corruption, both against Ministers and Members of the Government. That was certainly the meaning that any unprejudiced person would make
  1326
  out of the speech. Why did he drag in the genealogical tree instead of a table of statistics, if he did not mean to insinuate charges of corruption? Why did he ransack "Burke's Peerage," "Who's Who," and "Dodd's Parliamentary Companion" if not for that purpose, if his object was purely financial. If he believed in those charges, he was thoroughly justified in making them whatever might be the consequences in India, because if there was any truth in them it was more desirable that they should be unmasked and put a stop to rather than continue unsuspected until a final calamity was reached. But if he did not believe in them, and was merely repeating rumours and fishing for information, and trying generally to discredit the Government, if that were all, then I can only say that in view of the terrible result which the dissemination of such rumours and scandals and beliefs might have in India, his conduct can only be described as infamous.
  Mr. W. E. HARVEYrose in his place, and claimed to move "That the Question be now put," but Mr. Deputy-Speaker withheld his assent, and declined then to put that Question. Debate resumed.
  Mr. GWYNNE: In view of the statement which the Prime Minister made early in the afternoon that he intended to set up a Royal Commission to inquire into the larger question of the administration of the Financial Department of the India Office, I beg leave to withdraw the Motion standing in my name to set up a Select Committee, because I feel that Royal Commissions will cover a wider ground, and will carry more weight than a Select Committee would have done. But I must add that it is a matter of regret to me, and I think to many of my friends on this side of the House that the Prime Minister did not see his way clear to allow some committee of investigation to thoroughly inquire into the whole question of the purchase of silver by Messrs. Samuel Montagu and Company. One thing was perfectly clear that in their answers the Prime Minister and the Financial Secretary to the War Office never attempted in any way to defend the India Office in the thoroughly unbusinesslike way—
  Mr. ROBERT HARCOURT: Is the hon. Member entitled to go into the general subject when asking the House for leave to withdraw his Motion?
  Mr. DEPUTY-SPEAKER: The hon. Member moved a substantive Motion, and has the right to reply. In doing so, I understand he is asking leave to Withdraw the Motion.
  Mr. GWYNNE: I have no intention of going into the whole question again, but merely wish to put on record that I think it is a matter for regret that the Prime Minister has not seen his way to have the question of the silver purchases more fully, or indeed at all, investigated at the present time. I think I am perfectly justified in making that statement when I ask the leave of the House to withdraw my Motion. I should like to say, in answer to the hon. Member for the Bridgeton Division (Mr. MacCallum Scott), that I made no insinuations either in this House or out of it. I made certain definite charges, which I am perfectly prepared to stand by. [HON. MEMBERS: "What are they?] If you wish it, I will enumerate them; but I do not think it will be in order for me to go into that again. One charge I made has not been touched upon, which is that this transaction, if it was to be given to Messrs. Samuel Montagu and Company to carry out, was, so far as the India Office was concerned, carried out in a most unbusinesslike way. That is a charge the Prime Minister should have dealt with when he was purporting to deal with my charges. No answer was made at all. I did make a very strong point that the India Office in this matter had not taken the ordinary precaution, which any business firm would have taken, to put on record their telephone messages, their interviews and their meetings with the firm, by which important matters of business were transacted. That being so, I think I am quite justified in commenting on it. If that is procedure which the Prime Minister thinks of no importance, we differ. I quite realise that in setting up a Royal Commission we may have the larger question dealt with, which, after all, is the most important matter, and one which all in this House will wish to see dealt with. I hope that so far as these transactions are concerned that the publicity given to them will deter the Government in future, or make them more careful in passing on these large contracts to their friends and relations—[HON. MEMBERS: "Oh, oh!"]—I stand by that—and from carrying them on in the very unbusinesslike way which they have done. I beg leave to withdraw the Motion.
  1328
  Leave to withdraw Motion withheld.
  Sir JOHN JARDINE: I desire to express my complete satisfaction with the way in which the Financial Secretary to the War Office and the Prime Minister dealt with every part of the numerous charges, accusations, or insinuations which the hon. Member levelled in so large a number and with such great detail at the transaction of the Secretary of State for India with the firm of Messrs. Montagu and Company. Every point worthy of notice was wholly answered. The conclusion I arrive at is that the Secretary of State for India, from the beginning to the end, carefully, cautiously, and succesfully managed the negotiations with the firm for the buying of silver in the interests of India, and in such a way as in all probability to save a large sum of money. As to the slight matter of not recording a word or two in conversation, or everything said over the telephone, I should doubt if that is the practice of business men in the city. A great deal of business is done without any registration of the bargains they make there. When we come to the question of lending money to banks and financial institutions, it has been said to-day that questions were not properly answered, as if there had been a desire. to conceal facts, even when hon. Members. put plain questions. I do not in the least concur with that view. The first question on the subject was one I put down a few months ago, when I wanted to know something about the handling of these large balances, what they were, and what was the security for getting them back. A very definite statistical answer was given, and is on the records of the House, and I did not think it my duty to put any further question because the answer was so full, and the effect was generally to satisfy the public mind with definite information, which is more than suspicions, rumours, or insinuations, or any kind of gossip.
  As regards the lending of money on securities or on deposit, I am satisfied with the promise made by the Prime Minister that he will appoint some Select Committee or Royal Commission to inquire into the matter, not because anything has arisen in the course of this Debate to promote suspicion. Because the amounts are so large, and the question is connected with that of exchange, gold currency, relation between the exchange and the India Office, and the Presidency

  1329
  Banks in India; because the interests are so large and depend so much on the experience of the past, especially the year 1838 and more recent years, and because there is a good deal of division of opinion among financial and currency experts on this question, I think it is a good thing that the public should be informed that that is the Prime Minister's intention. I entirely concur with the warning given by my hon. Friend of the Bridgeton Division (Mr. MacCallum Scott), as to the dangerous nature of Motions which are brought forward, and supported, in the way this one has been brought forward. Anyone acquainted with the old saying, that every man has his price, will feel that this kind of talk will fall on fertile soil. It has been said in one of the superior Courts here, that public men have a high interest and property in their character, and that those characters are not to be lightly assailed. That is the reason why the Courts refuse to admit to their records petitions and documents which contain libels, insinuations, or charges against persons of dignity, or those who hold great offices under the Crown. I feel sure that a speech containing numerous insinuations—so we all regard them on this side—is likely, if published in India, to do a good deal of damage, not only to the belief of the Indians in the purity of official life here in the House of Commons even, and in the India Office certainly, but the officials out there will be looked upon with the same kind of suspicion, and that is a very dangerous thing for the Government of India and a very great hardship and shame to which to expose such men as are doing the work of the Government out there. I would, therefore, join in the exhortation that the hon. Member (Mr. Dundas White) made on that important part of the speech. I think a Motion like this, so supported, deserves to be withdrawn, and I am glad the hon. Member has taken that resolution, late though it be.
  Mr. HOGGErose in his place, and claimed to move "That the Question be now put," but Mr. Speaker withheld his assent and declined then to put that Question. Debate resumed.
  Lord HUGH CECIL: I am not surprised that hon. Members are rather uneasy under this discussion. I should certainly vote for the Motion if it was pressed to a division, but as the Prime Minister has promised an inquiry into a large part of a
  1330
  subject that alters the case. If it were a Motion directly censuring the conduct of the India Office I should vote for it without the smallest hesitation. This is really a matter of very great gravity, and not to be put aside by the tone which the hon. Member thinks it right to assume. I do not intend to speak with authority—it would be presumptuous and impertinent for me to do so—on the details of the silver market or the technicalities of finance, but I have been familiar ever since I have been very young with the traditions of public life, and the manner in which these matters are, and have been in the past, commonly treated by Parliament, and both the speakers from the Government Bench—although the Prime Minister treated the matter more gravely and in a better spirit—and other speakers seemed to me very imperfectly to realise how serious a breach, I do not say of public honesty or of public purity, but of public delicacy, has been committed by this contract and the manner in which it has been handled. Let me make quite clear the distinction. I do not think for a moment that what was done was in any sense corrupt. I think what has been done is very grossly indelicate, and that public money has been most indelicately dealt with and the traditions of public life have sustained serious injury. I think my hon. Friend has done a great public service in calling attention to the matter, and I am convinced that though the Government, naturally enough, according to the ordinary customs, defend what is done, such a thing will not again be done after what has been said here to-night and outside.
  10.0 P.M.
  Assume all that the Government say to be well founded and sound argument about the necessity of what was done; suppose it to be perfectly true that they were driven to do this, and that the necessities of the public service imperatively required it; even so, they are greatly to blame for the manner in which it was done. I do not think their speeches show, or that the House generally seems to appreciate sufficiently gravely what a serious departure from all ordinary official rules it is to give a lucrative contract, at the solicitation of the firm who received it, to a near relative of a Member of the Government in the very Department that granted that contract. That is a most unseemly thing. It may have been necessary in the public interests to do it, but it was, on the face of it, a most unseemly and indelicate thing to do. It is quite contrary to all the traditions of

  1331
  public life, and it is perfectly absurd to represent it as an ordinary transaction. When I first heard of it, I felt that such a thing has never been heard of in the ordinary practice of official life in the past. I am not able quite to agree with the right hon. Gentleman (Mr. Bonar Law) when he says there is no danger in this matter of corruption growing up, because Ministers have, if there was no other reason to consider, the motive of self-interest to prevent them indulging in anything of the kind. We must remember that though in our country we believe corruption is still impossible, we are very unusual in that respect. It would not be seemly to mention particular countries, but I doubt whether there is any other great country, at any rate there are not very many, among whom gross personal corruption of Ministers of the Crown is not known to exist. It is therefore a very real danger, and the objection to what I call an indelicate transaction is just this, that though there is no real harm done it makes a precedent for a transaction which really is corrupt, and this transaction might easily be made a precedent for a transaction which was really corrupt, and which really was a sacrifice of the public interests to private advantage. I do not for a moment think this was, I have not the least doubt it was not, but I think it was done in a manner which shows the importance of dealing with these matters with the most scrupulous care, and which covers the Government and the India Office with discredit.
  If this strange condition of the silver market prevailed and it was really necessary to do it, the first thing that ought to have been done was to enter a Minute in the India Council noting how very exceptional the transaction was, noting how very much open to criticism it was, and pointing these things out in order that it might never be drawn into a precedent. Then, when the matter was carried through and the silver had been obtained, the Government should not have lost a moment in taking Parliament fully into their confidence, and explaining the very exceptional circumstances which induced them to do what they have recognised to be an irregularity. If that had been done, no reasonable criticism could have been made, except in so far as the particular circumstances called for it—no criticism I mean on the seemliness of what had been done—but as it has been done, it has been
  1332
  done with every circumstance which might naturally aggravate suspicion and induce it. No satisfactory answer has yet been given by the Members of the Government to the question why the Bank of England was not taken into confidence in the whole matter, why it was not consulted, and why the matter was not carried through in accordance with its advice. There is no real reason why the Bank of England should not have been consulted. No reason has been given for the secrecy in respect to the Bank of England. How is it possible to give the Government the credit for a real sense of the danger they were incurring and of the suspicions they were exciting when they would not take that obvious course of first of all approaching the Bank of England before they went into any separate bargain with Samuel Montagu or anyone else? That was the natural and the obvious course, but from the beginning of the transaction to the end, they, as it were, assumed the garments of guilt. They did everything in their power to suggest that there was something wrong in the transaction in which they were engaged. I quite believe there was nothing wrong, but I think there was a consciousness that these imputations might be made, and that consciousness made them uneasy, and made them, as anxieties are apt to do, lose their head in the matter, and not see that frankness and openness were the very things they ought to study when engaged upon a business of this kind.
  I greatly regret that the matter has been treated by hon. Members behind the Government, and to some extent by the Financial Secretary—I do not say by the Prime Minister—as though this were not a matter which properly engaged the attention of the House of Commons. [An HON. MEMBER: "No."] The hon. Member really does not appreciate what is the real danger. It is that corruption should grow up. I greatly regret that hon. Members behind the Government have shown no sign of their sense of the gravity of the issue. I am quite sure that every party in this country stands to lose unless we are scrupulous in insisting that the Government shall not merely avoid corruption, but shall give no occasion for suspicion of corruption. It is quite impossible to say that the Government have done that in this case. They have given that suspicion, and I think it is profoundly to be regretted that no protest

  1333
  has come from their own side against conduct which tends to lower the traditions of public life. [Interruption.] I do not know what the hon. Member means. Whenever the Government transgress, we shall certainly point out that there has been a gross failure to observe the traditions of public life. [An HON. MEMBER: "Divide."] You are only prolonging discussion by interrupting. I greatly regret that the Government have so treated this subject. I am satisfied that the stain which has been left on the reputation of those concerned is a real one—not the stain of corruption, but the stain of want of discretion and delicacy. I am sure they have lowered the traditions of public life in dealing with this matter in the way they have done. If they had dealt with it in a franker way, they would have removed whatever elements of suspicion there are in the matter. [An HON. MEMBER: "Divide."] I am not going to be put down by the hon. Member. If he does not feel as I do, that this is a serious matter, I can only say he is less acquainted with the traditions of public life than he ought to be, and, above all, most unsuited to be a democratic Member, because of all the dangers which threaten democracy corruption is the greatest. Unless you maintain the tradition of scrupulous delicacy in dealing with public money, then assuredly you are opening the door to corruption. I hope the Government will lay this lesson to heart and take care that their reputation is not again stained as it has been by the transaction which we have been discussing to-night.
  Motion put, and negatived.

  RAILWAYS (No. 2) BILL.
  Order for consideration of Bill, as Amended, read.
  Bill, as Amended, considered.

  NEW CLAUSE.—(Duration of Act.)
  This Act shall continue in force for five years after the passing thereof and no longer, unless continued by Parliament.
  Mr. FREDERICK WHYTE: I beg to move, "That the Clause be read a second time."
  When a new Clause similar to the one I am now moving appeared on the Paper, I, in common with a great many Members,
  1334
  imagined that the Government would offer no objection to it. Our reason for supposing that was that this is frankly an experimental measure. I think all parties concerned in it, and certainly the traders themselves, are very much in the dark about it. They would have liked to have seen a limit set to the time of its operation. I do not think the President of the Board of Trade last night gave us adequate reasons for the course he took, especially in view of the fact that the Amendment in itself is, I believe, in the opinion of the majority in this House, quite unexceptionable. We had one reason given to us by the hon. Member for North Somerset, namely, that what would happen would be that at the end of three or five years, as the case may be, the measure would be put in to the Expiring Laws Continuance Bill, and so continued from year to year. I conceive, if this is a proper measure, it is just such a one as should be placed in the scope of that Bill. A great many Bills are included in the Schedule of the Expiring Laws Continuance Act which should be removed. It should be reserved exclusively for Bills of this kind. We have the precedent in this case of another experimental measure, namely, the Minimum Wage Act, which was passed in the early part of this Session. Clause 6, Sub-section (2), of that Act places a time limit of three years on the duration of it, and I think I am entitled to maintain that this measure now before the Committee has in some degree been brought forward in unexplored territory, and even if the supporters of the measure say it is not a step in the dark, and that the traders are wrong in saying so, the acceptance of this new Clause would remove the uneasiness which the traders feel. That such uneasiness prevails was made plain on 22nd August, 1911, on the Motion for the Adjournment, when hon. Members on both sides of the House rose and pressed the Government to explain what was the pledge given to the railway companies. That uneasiness found further forcible expression both on the Second Reading and the Committee stage of this Bill, and I maintain it would be greatly alleviated if the President of the Board of Trade could see his way to accept this new Clause. In that case, the traders would know that at a given period, if there was anything to debate upon, the measure would of necessity come up again for discussion. They would know by the very fact that a time limit was

  1335
  established that it would be very much easier to have the question reopened in Parliament than it can possibly be if the measure is left without any time limit of any sort. I am sure it would greatly smooth the small remaining part of the passage of the Bill through Parliament if the right hon. Gentleman would accept this proposal or, indeed, any other time limit in regard to the Bill. I wish to refer to a question not unconnected with the time limit, namely, the suggestion—I will not call it the promise—the Government has made that inquiry should be made into the general question of railway management. Nobody could be more explicit on this particular point than was the Chancellor of the Exchequer on the Second Reading of the Bill. He said:—
  "My right hon. Friend the President of the Board of Trade is considering the matter, and he is hopeful of being able to make an announcement at no distant date."
  He went on—
  "I am sure that something should be done. No one is satisfied with the situation now."
  In another place he said—
  "I think there certainly ought to be some further investigation into the position. It is one of the necessities of the situation."
  If the right hon. Gentleman can accept those points or accept this Clause or as an alternative make a definite pledge that a full inquiry will be given, this Bill will receive a greater measure of Parliamentary assent on the Third Reading than it is likely otherwise to get.
  Mr. C. BATHURST: I desire to second this new Clause. There is an outstanding debt due to the traders of this country in respect of many grievances as to which repeated promises have been made to deal with them. An attempt was made to deal with them in the former Bill introduced this Session which has now been withdrawn and we are left in a condition of doubt and indefiniteness, in consequence of this one Clause Bill, as to whether and when these grievances are to be met. In these circumstances, it is only fair to the traders that some limit should be placed on this Bill so that meantime the Government may have an opportunity of introducing those Clauses which are not in this Bill.
  The PRESIDENT of the BOARD of TRADE (Mr. Buxton): I do not think I can add much to what I have already said on the part of the Government in oppos-
  1336
  ing this proposal, which is in substance the same as the proposal we had last night. The House should remember that the undertaking given by the Government was not, as some seem to think, conditional for a particular time and to come to an end at an early period when the events connected with that time had ceased to exist. It was a condition of the acceptance of the Report of the Royal Commission, through the Conciliation Boards, to improve the pay and conditions of labour, and to impose on the railway companies obligations which have led already to a considerable increase in pay and improvement in the conditions of work. I understand that it was not intended that this should apply to the first series of this matter, but to successive series as well. The Conciliation Boards and the machinery connected with them are current, and I am glad to think that so far they have worked smoothly and satisfactorily, and will continue their operations, and will be current when this Clause will come into operation. From the trader's point of view it is an advantage that there should be these Conciliation Boards. Strikes are very serious from the trader's point of view, and everybody desires that they should be avoided. The object of this Bill is to remove a stumbling block from the path of the railway companies by removing a doubt which has arisen from time to time in reference to the method by which they can meet the increased charges due to improved wages and conditions of labour. That is the extent to which the Bill goes and the object with which it was introduced. The hon. Gentleman who seconded the Amendment, said, as to a Clause discussed the other night, that it would operate on wages after 1914, which, I think, was the date of that Clause. The same argument applies to this proposal, and if a particular time limit is fixed, it would operate on the wages after that date. It would not be in conformity with the undertaking of the Government; and, secondly, it would be destructive of the main object of the Bill if my hon. Friend's Amendment were adopted. The hon. Member in support of the time limit mentioned that there were other questions, besides wages, in which the traders were interested. Obviously, it is the duty of the Government at no distant date, to deal with the various questions which were contained in Railways (No. 1 Bill). I hope the House will support the Government in rejecting a time

  1337
  arrangement which would not be in the interest of the traders, which I am sure would be detrimental to the men, and which would be opposed to the undertaking which the Government gave.
  Mr. STEPHEN WALSH: I spoke upon a very similar Amendment last night, and I feel that a few words ought to be said against this one. I think it is desirable that both the leading Ministers and subordinate Ministers should be in their places when statements are being made as to the reasons for a particular line of action. We were asked last night by the Parliamentary Secretary to the Board of Trade to remember the conditions under which the Government's promise was made. We are told that as a matter of fact the promise was not made so much as a settlement of a particular strike or great difficulty existing at the time, as to enable certain Conciliation Boards to be continued. I do not know whether there is a time limit applying to those Boards or not, but I believe there is, and I see no reason why in regard to a measure of this character its continuance should not always be within the competence of Parliament to determine. Indeed, neither the right hon. Gentleman nor his subordinate officer has given a single reason to the House why the matter should be taken out of the competence of Parliament itself. Still, I would ask the House to remember that two cases, very similar in character and in their national gravity occurred—one the railway strike, and the other the strike of miners a little later. They were both of overwhelming national importance, and they were both dealt with on very similar lines. The State is represented by the Ministers on that Bench, and this House was asked to consider the best thing to do. They were both matters affecting the very low wages of the people engaged in very fundamental toil, and that was really the reason why this House was invoked to assent to a Bill of this character. The men were being very badly under-paid, and the Bill is to enable the railways to lift up those wages. The same conditions applied in the case of the coal mines. An inquiry was held by the leading officers of the State. They admitted the case of the men, and they said, "This is unique; we will put a time limit to it. The men are entitled to very much better wages; we will lay down a condition which will guarantee to them a certain minimum wage, but we will limit the operation." The right hon. Gentleman
  1338
  himself has very carefully refrained from making any attempt to discriminate between those two cases. They are both alike in fundamentals; they both originated because of the cruelly low wages of the men. They asked this House because of those low wages to assent to certain proposals in one case, the Minimum Wage Act for miners, and in the other case this Bill which is now under consideration. I am not, of course, setting one case against the other, but I submit if it was right to put a time limit of three years in the Coal Act, unless Parliament otherwise determined, that it is equally right that a similar principle should be adopted in this Bill. The hon. Member for Wilton (Mr. C. Bathurst) submitted an Amendment for three years last night. He spoke of the grievances of the traders, which have been for many years before this House and with which no honest attempt has been made to grapple. There is not the slightest doubt but that those grievances have a right to be settled, not as a result of a bargain on this Bill, but on their own merits. I hope that that attempt will come, and speedily, because all of us know how very serious are the grievances under which the traders of the country labour, particularly in the matter of owners' risk. Apart from that, I submit it is not the proper way for such grievances as those to be settled by coming to a bargain as to the duration, limit or no limit, of a Bill of this character. I would ask the attention of the House to what is in the newspapers to-day. [An HON. MEMBER made an observation which was inaudible.] This matter has not been mentioned before, but even if it had I am not to be debarred from mentioning it because of the fact of one or two discontented railway directors sitting on this side of the House.
  What is the case to-day? The "Times" to-day contains the record of the railway dividends that have just been declared. In some cases those dividends are the highest that have been paid for forty years. In the case of the London and North-Western Company a half-yearly dividend of 8 per cent. is declared, which has not been decleared before for about thirteen years. The amount of money for the previous half-year has got well on to over half a million. They carried £220,000 to the reserve fund—a greater figure than has been carried for a number of years. The same kind of thing applies to the Great Western. In the Midland a very

  1339
  similar condition prevails, with greater dividends than have been declared for many years. On the great mineral lines, the exclusively mineral lines, the dividends are also largely increased. I submit that is a condition of things which justifies this House in asking that a time limit shall be imposed. We, of course, are perfectly aware of the compact that has been entered into with the railway directors on both sides, and we know with what cool indifference they are treating our entreaties. We know perfectly well they can sit quiet in this House and that the Government will come to their assistance, and that this Bill is to be driven through without any single Amendment of any importance being accepted. I have listened to a great deal of the Debate, and I say distinctly that no Amendment of any real importance has been accepted. There have been offers qualified by a good many "ifs" and "buts," and assurances that the right hon. Gentleman was not able to make a definite offer, but would do his best to get something if something else followed; but it does not require many years' experience of this House to know what is the value of that kind of offer. We have all been made acquainted with the genuine alarm felt by the traders of the country. We know that handsome profits are being made upon the wages already paid. If slightly better wages are being paid, the railway companies are more than compensated by increased profits. The public are already being bled; and the process ought to be stopped at the earliest possible moment. I regret that the three years' limit has not been again submitted. At any rate five years is sufficient time to enable railway companies to justify their case, and at the end of that time Parliament ought to resume its competence to deal with cases of this kind. If, at the end of five years, we find that the measure is a good one it can be continued; but if we find that the measure is bad, as I believe it to be in inception, and in detail, it ought to be within the competence of Parliament to bring it to an end.
  Mr. PETO: I find myself in agreement with almost all that the hon. Member for Ince has said. There are, however, two points on which I differ with him. The first is that, although he is supporting an Amendment moved in the interests of the traders, he does not seem to see that the interests of the traders and the interests
  1340
  of those whom he represents are on this matter, as I believe they are on most economic questions, identical. Nor can I agree that the President of the Board of Trade has not inserted a single Amendment of any importance. I recognise to the full that the right hon. Gentleman has met a very difficult situation with the utmost impartiality he could command, and has done his best to get out of the impossible situation created by the very improvident bargain entered into last year. The Bill has been materially amended. At the same time I could not help thinking that perhaps the right hon. Gentleman was consulting the Attorney-General as to whether this Amendment could not be accepted. His sole argument against it was that there was no specific word in the agreement of August last limiting its operation to any particular period. The Memorandum issued to the House states that the Bill carries out the undertaking given by the railway companies on the settlement of the railway strike. Therefore it seems to me obvious that there can be no question that in respect to the whole of this agreement, which relates simply to the conditions that existed at that time that some term must be placed on its operations. This extraordinary arrangement is, I venture to say, made for the first time in any Bill presented to Parliament enabling a particular industry in this country to hand on by Act of Parliament, to the other industries of the country the obligations that they may incur in the future in regard to the labour staff that they employ.
  There are three reasons why I support this Amendment. I shall state them categorically. The first is that I say it is perfectly impossible for the Railway and Canal Commissioners to carry out the terms of the arrangement entered into by this Bill justly and equitably till they have full details of the accounts provided by the railway companies, a course advocated by the Committee that reported so lately as 1909. The trading community of the country will then be in a position to know precisely in respect to what particular traffic and what particular part of the conveyance of that traffic or terminal charges the increase is charged; and what is put on for transport, and what for terminal charges. They will be able to see then how to adjust the burdens which it is proposed to place upon them under this Bill. That appears to me absolutely essential before any questions that are

  1341
  brought under this Bill can be equitably and judicially decided. I do not believe that it is possible for this great commercial country to go on for a period of another five years without statutory recognition of the fact that it is the duty of the railway companies to produce not only financial accounts but statistical accounts which will be able to justify them—if it is possible to justify them—in the increase of the present exorbitant rates for the carriage of the goods traffic of this country. The second reason is that this Bill must be limited because of the cost of the carriage of goods in this country which is at the present time so enormously greater than that of every other country that I do not believe for a moment that that state of things will be allowed to remain for a period of another five years. When we consider the economies which can be effected in handling goods before they get on to the rails and before they are ever started on their journey, then we shall see the whole reason and basis of this Bill removed. Then I want to point out the fact to which the hon. Member for the Ince Division alluded, and that is that at the present time certain railways in this country are earning large dividends, and besides earning dividends are experiencing now a period of unparalleled prosperity.
  The net and gross receipts in the case of the Welsh railways have increased enormously for 1912 as compared with 1911. I will give the House the percentage in the case of the Taff Vale, Barry, and the Rhymney Companies. In the first case the gross receipts increased by 11 per cent; in the second ease by 18 per cent.; and in the third case by 8½ per cent. The result was that the net dividend increased by 1¼ per cent., 3 per cent., and 1 per cent. respectively. I say if that was the result in the case of the mineral-carrying railways, where they have got a simple problem to meet, and a largely increased bulk to carry, is it not possible for the railways of this country, where they have a more difficult problem to meet, through their management, not to provide similar or somewhat similar results? The moment that happens the whole justification for this Bill is gone, and therefore we are bound to apply a time limit to this arrangement, which I regard as a wholly improvident arrangement. The bald fact is that the traders of this country are handicapped by our railways in comparison with the foreign competition we have to meet to a gigantic extent to-day; and, therefore, if we are to have any
  1342
  relief in future, if we are to carry on the trade of the country and give employment it is absolutely childish that it should be urged by these great railway corporations that it is impossible for them to increase the remuneration of their employés without having power to add to railway rates, which at the present time are three times greater than those of the United States of America and are over double he rates in France, Germany, and Holland. I think that is a disgrace to this country. I do not believe this should be allowed to continue for a period of five years, and, therefore, I beg the House to accept this Amendment to put an end to a condition of affairs that permits no improvement in the conditions of labour unless we impose a further handicap upon the trade that employs the labour of the country.
  Mr. WATSON RUTHERFORD: The whole trading community of the United Kingdom, as represented by almost all its organised bodies, looks with the greatest possible amount of suspicion upon this Bill. They do not like it; it causes them grave misgivings. It starts by throwing the necessity for complaint upon the traders, and I think that the suggestion that it should have a reasonable time limit to see how it works is the only thing we can do now to meet this general suspicion. This is not a political matter, and I trust that the House, as a whole, will see that it is a most reasonable suggestion that a five years time-limit should be put into this Bill.
  Sir A. MARKHAM: I desire again to impress upon the House that in passing this Bill without a time limit it must prove disastrous to the traders. Nothing in this Bill gives us any information to enable us to arrive at what the cause of the increased rates is. Traders will go to the Court without having any information to enable them to say what cause the railway company has for putting on the increased cost on any particular service. The President of the Board of Trade said last night that it will have the effect of making the railway companies separate their charges. It has been repeatedly recommended that these accounts should be separated in order that the country should know what the cost of working this monopoly is at the present time. Anyone who has had any experience before the Railway Commissioners knows that the railway companies hold all the trump cards and the

  1343
  traders hold none. This Bill must place a burden on the traders of the country. I know that we must let this Bill go through, but I think I am entitled to say in the interests of the trading community that it is perfectly monstrous for the Board of Trade not to have safeguarded the interests of the traders and the community at large by insisting upon separate accounts. The savings effected by railway companies and the large profits they have made during the last twelve months owing to the general prosperity of the trade of the country; also the dividends have been very substantial, but, notwithstanding that, when trade gets bad the railway companies will still be entitled to keep on charging the higher rates whether the state of trade justifies it or not.
  Can the President of the Board of Trade give us an assurance that he will ask the railway companies to separate their accounts? I have asked him several times in the House, and he seems to remain perfectly indifferent to what, after all, is the crux of the whole question. If the railway companies by amalgamation are going to make economies, is it not reasonable to say that at the end of five years this Bill should cease to operate? I know that we are bound by the pledge of the Government. We are in that difficult position, but because the Government have foolishly entered into this agreement without a time limit, is it reasonable when trade is likely to be on the down grade that the railway companies should be able to pay increasing dividends at the expense of the community. Nevertheless, the President of the Board of Trade is willing to allow that state of things to go on, giving to what is a pure monopoly the right to continue those charges. This Bill is not only antagonistic to the trader at large, but it is a premium on bad management. However bad the management, and however inefficient the general conduct of railways, it is of no matter to the railway companies. Up go the rates, and the trader has to pay them, because when he gets into court he has no means whatever of proving his case. It is interesting to notice that although this Bill is of such enormous importance to the trading community there is not a single right hon. Gentleman on the Front Bench opposite. I was going to say I hoped there was some right hon. Gentleman opposite who would support those on this side below the Gangway who feel so
  1344
  strongly on this subject. If my hon. Friend goes to a Division, I shall certainly support him.
  Mr. C. E. PRICE: I have never known a Bill which has been so strongly opposed by Members on this side of the House, and I am quite satisfied if we were free to vote on this Bill it would be lost. Unfortunately, we are bound by the Prime Minister's pledge, but the Amendment before the House is one which does not destroy that pledge. The pledge is fulfilled, and at the end of five years we have an opporutnity of revising what the House has done. The reason I think everybody should support this Amendment is this: Last night I unfortunately referred to the Act of 1894 when I was really speaking of the Act of 1888 whereby railway companies were allowed to revise their rates. That Act was not so much opposed by large traders, such as coal-owners, but when it came into operation it was found that it very materially and injuriously affected the interests of the small traders, or, if you like, the large traders who deal in small things. When a traveller goes to a town and collects the whole of their orders, they are able to include the whole of the goods in one consignment, and get a lower rate; but, supposing any customers send an order between the visits of the traveller, it is necessarily small, and the charges are extremely high. The Act has proved very disastrous indeed to the small traders of the country. I maintain, if the directors of railway companies had been as anxious to consider the conditions of their workers as they have been during the last ten or twelve years to increase their dividends, there would have been no strike. The hon. Member for Ince (Mr. S. Walsh) gave the figures with regard to the London and North-Western. I happen to have some figures which cover a period of ten years, going back to 1901. The Midland Railway Company in that period have increased their dividends by 40 per cent., the North-Eastern by 16 per cent., the Great Northern by 50 per cent., the Lancashire and Yorkshire by 20 per cent., the Metropolitan and District by 45 per cent., and the London, Chatham and Dover by 60 per cent. I am not going to say that these dividends are too high, but I do say that the increased dividends which have been earned in this period warranted the railway companies in considering what they should do

  1345
  for their servants. In order that the House may realise the condition of the servants whilst the companies were paying these high dividends, let me give some figures. The largest group of railway employés in England and Wales earn from 23s. to 25s. per week. In Scotland they get from 19s. to 20s., and in Ireland from 12s. to 15s. I have no hesitation in saying that these wages at this time of day are a positive scandal. Every manufacturer knows, and everyone in the habit of dealing with wages knows, that you may have an increase in wages and at the same time a decrease in the actual cost of production. Suppose a railway company increases a driver's wages by 5s. per week, are they warranted on account of that in claiming an increase of rates? It is the easiest thing in the world to put on extra trucks, or, for passenger traffic, extra carriages, and whilst there is an increase of wages for the men employed on these trains the company may at the same time be working at less cost by reason of increased carrying power. I hoped something would have been done with the Bill so that railway companies would not be able to justify increased rates on wages alone, whether or not they have been able to work on the whole at a lower cost. That they have been able to work more cheaply is proved by these increased dividends. I say this Bill is unwarranted. The only reason for it is the pledge of the Prime Minister, and this proposal does not destroy the pledge of the Prime Minister.
  Mr. MORTON: Certainly it does appear to me that when it is admitted by all independent authorities, and when the Government cannot deny it, that the Bill is a bad one, they might agree to limit it to five years, when we may have a Government which will be more independent. It was admitted by the President of the Board of Trade that he could not allow any Amendment to this Bill without the consent of the railway directors. We have a right to ask: Does the Government represent the railway directors or the nation? It is well known that if the Government took off their Whips they would not get a single Liberal vote except from the few they have in the railway interest among them, and I doubt whether even they would like to go against their constituents. This is a very moderate proposal, and cannot damage even the railway directors. Considering we have a Liberal Government in power, or in the power of the railway directors, should I
  1346
  say, and when we have a so-called Liberal majority, I think it is a shocking state of things that the Board of Trade and the Liberal Government should be entirely under the authority of the railway companies. The sooner we get rid of that state of affairs, lock, stock and barrel, the better.
  11.0 P.M.
  Mr. HUDSON: I would appeal to the right hon. Gentleman to accept this Clause. It will not in any way endanger the Bill or hinder the Government in carrying out their pledge. I have several reasons for urging that. The first is, that the scheme which has been set up so far as the men are concerned can be terminated or amended at the desire of either party at the end of 1914, after notice is given. There is another point which materially affects the whole situation. Since 1900 we have witnessed an evolution in the methods of manipulating traffic upon our railways. There has been a vital change during that period. That change is continually going on, and it may be anticipated that during the next five years there will be far more rapid progress than there has been during the last five years. We are now witnessing a scientific organisation with regard to the handling of traffic. If hon. Members have noted some of the recent announcements, even with regard to some of the very small railways, such as the Taff Vale Railway, they will have seen that they are adopting the control system, which is set up to control traffic in very wide areas. It means that they avoid congestion of traffic at various points on the system and thus save in management a very large sum. This system is but in its infancy. The Midland Railway Company were the first to largely adopt it, and they are to-day saving very large sums of money thereby. Neither the companies nor the traders know what the cost of working will be five years hence in consequence of these alterations. Where there has been a normal cost of management up to about 63 per cent. of the total receipts over a number of years, it might reasonably be expected that in the next five years the total cost of management will be reduced to under 50 per cent. In consequence of that there will be no need whatever for this Bill to operate, and it would be a fitting time to take a review of the whole situation. So far as I am concerned, as representing the railway men, I have no objection to these improved methods of management, provided that those who do the work have

  1347
  an adequate opportunity of reaping their share of it. And then, of course, the trader should have an opportunity as well of taking a share of this advantage. You have your Americanised engine which takes one and a-half times the weight of traffic they took formerly, and you are adopting now everything that the genius of man can devise in order to save in the working expenses, and from all these points of view it would be, I think, wise on the part of the Government to give a limit of time at the end of which they can take a further view of the whole of the circumstances and thus satisfy all parties concerned in this matter. For these reasons I appeal to the Government to accept the Amendment, which would do no damage whatever.
  Mr. STEPHEN COLLINS: I trust the Government will accept this Amendment. The hon. Member (Mr. Hudson) has spoken about economies which have been put in force by the railway companies lately. I believe it is common knowledge that, if not directly, at any rate indirectly, they have increased their charges to traders during the last few years. For instance, I believe they have now dropped out altogether paying any claims for goods carried at owners' risk, whereas formerly their custom was to meet traders when gross negligence on the part of their servants was proved in handling the goods. They have also considerably enlarged the list of goods which they refuse to carry at the common risk unless packed in a particular manner suitable to themselves. Then as to demurrage. I believe they have become far more strict than formerly. So altogether the companies have been having a general tightening up in favour of themselves and to the disadvantage of the traders. I hope that will be taken into consideration by the President in considering whether he will accept this Amendment, and on the general Bill, if it is passed to-night, I hope and trust the railway companies, in the time of their success, will remember so many of their poorly paid employés, and let them share in their success.
  Sir A. MOND: I feel that the Debate to-night must surely make it evident to the Government how strong the feeling is in favour of a time limit being inserted in the Bill. I have been very doubtful as to the propriety or utility of having a time limit, and I was greatly influenced by the
  1348
  arguments of the President of the Board of Trade that it would interfere with the existence of the Conciliation Boards, which we all wish to see preserved. But since I have learned that the Conciliation Boards themselves have a time limit, and that we have no guarantee that they will continue for more than another three years, I do not see how the argument that the time limit will interfere with the existence of the Conciliation Boards holds good. In fact it is rather the other way. The fact that Parliament would have an opportunity if it so chose—a rather remote contingency—of being able to refuse an arrangement which was merely come to in order to reestablish Conciliation Boards on a new basis, would be rather a guarantee that Conciliation Boards will remain in existence, and if it did not I cannot see any justification for this Bill remaining on the Statute Book. Surely it can never have been intended, when the Government gave this pledge—and there is not a single word in the pledge that has been published in the memorandum or the speech of the right hon. Gentleman which mentions the question of an indefinite time—that the railway companies should be put in the position that they should have exceptional advantages as far as the traders were concerned on this question whether Conciliation Boards should be continued or not, and whether or not the whole consideration on which this pledge was given has ceased to exist. I cannot conceive whether or not that was the intention. Our difficulty has been that the pledge has been given, and that it must be honourably observed, but the words of the pledge do not bear out a single contention of the President of the Board of Trade. There is nothing in the pledge that makes it a breach of it to insert the period of five years or any definite period. After all, Parliament can repeal this Act any year, whatever pledge any Government gives. That is obvious. But the repealing of an Act is a very much stronger and more difficult measure than simply grappling with the automatic renewal of an Act. Parliament would never dream of interfering with the Act without very good cause. I cannot see that as regards the pledge of the Conciliation Boards the right hon. Gentleman has made out his case. He advanced another argument yesterday, namely, that the railway companies, if there was a time limit, would endeavour to raise rates as much as possible during these five years. I have

  1349
  enough confidence in the sanity of railway directors and managers to know that they would do nothing of the kind. The Act would not be on the Statute Book twelve months if they carried out a policy of that kind. Has the right hon. Gentleman read how the Act of 1894 came into existence? It was because in 1892 and 1893 they endeavoured to carry out a policy of that kind. The Act was carried out with great celerity to prevent anything of that sort being done. Everybody knows that the proceedings before the Railway and Canal Commissioners will be little else than a farce, because a trader when he gets there is in an absolutely hopeless condition. Railway experts appear, accounts are thrown at him, and he is asked to prove that they are not reasonable, or that they are not properly allocated. It is almost impossible to do so. That is one reason why the Act of 1894 has been used so little. I do say in all sincerity that the Board of Trade must be made to feel that we want more sympathy than we have had all through the Debates up to now. I ask him seriously to accept the Amendment, and thus give the traders of the country the feeling that they have in him a champion who will look into matters in the near future.
  Mr. CHARLES DUNCAN: I think the House will agree with me that, there is no greater champion of economy in this House than the hon. Baronet, the Member for the City of London (Sir F. Banbury). Time after time he has moved Resolutions in this House putting limitations on Money Votes on the ground that he does not wish to give the Government a blank cheque. It has been pathetic to sit during the Debates on this Bill and find that one of the greatest orators in the House has not been able to make a speech on this Bill, and for once he remained silent. What is the position now? It seems to me that if the Bill goes through, instead of giving a blank cheque for one year as the hon. Baronet would have said on a Money Resolution, we are giving to the railway companies a blank cheque of a perpetual character. It is against its perpetual character that the Amendment before the House is aimed. No reason has been advanced why the conditions laid down in the Bill should continue for ever. This is called a time limit, but it is only a conditional time limit. The House of Commons would give the Bill a run for five years, but would always reserve in its
  1350
  own hands the responsibility and duty of putting an end to it if the conditions warranted it.
  Suppose a railway company does advance the wages of its workers and gets thereby a justification for increasing certain rates, there is nothing to prevent it later on from reducing the wages of its men—and we have no guarantee that they will not do so—and there is nothing in this Bill to prevent them going on reaping the advantages of the increased rates, while the men who were instrumental in bringing this Bill to the attention of the House may lose the advantages that were intended to be given to them during the late dispute. As far as management is concerned railways are in a condition of chaos. We have proof of this in the way in which in recent years numbers of the railway companies have come together and obtained running powers over each others lines. We have also seen that they are abolishing the different parcels offices, and in this way great economies are being effected. But there is no getting over the fact that you have an enormous number of Boards of Directors of the various railway companies in this country, and the mere fact that a Bill of this description is going through with no time limit of any character will have a tendency to perpetuate the chaos existing on the railway system to-day, whereas if the House of Commons continues to retain within its own power the chance of limiting the operation of this Act there would always be an incentive to the railway directors to keep endeavouring to improve their systems and bring them up to date.
  The ATTORNEY-GENERAL (Sir Rufus Isaacs): I am afraid that the greater part of this Debate has proved once again, if that were necessary, that this Bill is not very popular. It is necessary to remind the House that at a time of great stringency and difficulty a promise was made by which the Government is bound; and the view taken in the House of Commons was that it meant that a Bill should be introduced. My right hon. Friend has said to the House more than once, and he has repeated it through me, that it would be much better to leave the matter open to Parliament in the future to deal with this measure as it can with any other measure. If we inserted the Amendment, it would look as if the intention of Parliament was that the Bill should be limited. But that was not the pledge given by the Government. When an obligation is incurred

  1351
  everybody is ready to bear his share of the burden, to put his hands in his pocket, and almost to pay money in a time of great stringency and difficulty; but, unfortunately, when that period of stringency and difficulty has passed, hands do not go into pockets but rather button them. The Government is bound by the pledge it has made, and ought to be supported in carrying out what the whole House, or the vast majority of the House, wanted at that moment in the interests of the vast majority of the people, and which the vast majority of the people also supported.
  Sir A. MARKHAM: When the Government gave this pledge was there any undertaking given by them to the railway companies that the traders should not have full facilities for ascertaining before the charges were raised what was the cost to the railway companies of dealing with any particular traffic, irrespective of the future?
  Sir RUFUS ISAACS: I was pointing out—
  Sir A. MARKHAM: You are going to raise the rates, and I have got to pay.
  Sir RUFUS ISAACS: I was pointing out to the House how the matter stands with regard to the Government, and why it is that the Government cannot give way to the views which have been expressed
  Mr. POINTER: Am I to understand that this question of the time limit was definitely discussed with the directors?
  Sir RUFUS ISAACS: No, I do not say so; it was stated by the Government that there should be no time limit in the Bill, but that it should be left to Parliament to deal with if it thought fit, and whenever it thought fit. The effect of a time limit would be to take away the benefit of the valuable Clause introduced by my right hon. Friend yesterday, which gives an opportunity for reconsideration in the interests of the traders from time to time. I submit that it is much better to leave the matter to Parliament. Another Parliament might be returned which would take a different view, and it is entirely a matter for Parliament to deal with. I do submit that this is a case in which the House should support the Government in carrying out the undertaking which they have given.
  Mr. HIGHAM: My right hon. Friend has not quite apprehended the effect of
  1352
  this Amendment. It is not going to put an end to the Bill in five years, if adopted. If this Amendment be carried then in the fifth year the Bill will pass into the Expiring Laws Continuance Bill, if the Government so desire, and we shall have the opportunity of discussing the question. An important matter like this ought to remain in the hands of Parliament. It is a very different thing to have a Bill included in the Expiring Laws Continuance Bill from having to pass a new Bill. In the latter case we are entirely at the mercy of another place and does the House think that a Bill repealing this Bill would be passed in another place. That Bill would thus have to be passed three times, whereas under the Expiring Laws Continuance Bill the Bill could be discussed each year. If the cost of working has kept up during the five years by proper conditions to the men no one will wish to repeal the measure, and it will automatically be carried each year. We all know there are Acts of Parliament in existence which every Member of the Government wishes were in the Expiring Laws Continuance Act and which we cannot repeal on account of the other place. If we pass this Bill without a time limit we shall regret it every year as the years go by. I do appeal to the President of the Board of Trade to accept this proposal which does not invalidate the promise or weaken it in any way. If he does so, we will be more ready to support him during the remainder of the night. We recognise the pledge the Government have to carry out, but we ask some concession for the traders and that they shall not be bound for all those years.
  Mr. HAROLD SMITH: I cannot help, on looking round the House, asking those who are in charge of this Bill, "Where are their friends?" [An "HON. MEMBER: "Where are yours?"] There are very few of them in this House, and those who will support the Government in the Division Lobbies show little enthusiasm for the Bill and are now in the smoke rooms or the library. In view of the criticisms which this Bill has received, criticism which I am sure my hon. Friends opposite will see has not come from this side of the House in any party spirit, but which they will agree has mainly come from the Benches which support the Government—under those circumstances I do not really think that the Government are doing a wise thing or a proper thing in using the machinery which they always have at their disposal to run

  1353
  through a Bill of this sort which has not been attacked in any party spirit, and a Bill which in the minds of those who have considered it arouses great hostility and great opposition. What is the only justification the Attorney-General put forward a few minutes ago for the refusal of this Amendment? It is that the Government have given a pledge. In his very first words he commented on the unpopularity of his own Bill. What is Democratic Government? Surely, the first elementary principle of Democratic Government is that no Government ought to pass a Bill which the representatives of the people in the House of Commons consider unpopular.
  We have it from the lips of the Attorney-General himself that he regards this Bill as unpopular. He went on to justify the passing of an unpopular Bill because the Government had given a pledge. I understand that he says it is always unpopular to pay a debt. It is always unpopular to pay a debt which one ought never to have incurred. This is one of those debts. The Government incurred it when, having lost their heads at a critical moment, they gave, under circumstances with which they were unable to grapple, a pledge which will be very serious to the trading community generally. The Attorney-General said that this was a debt of honour. Although I am opposed to the Bill, I am glad to find that the Government have some conscience left when a debt of honour has to be paid, and I hope they will carry that principle in other directions. The Attorney-General used one piece of special pleading which was quite unworthy of him, when he said that this House could not bind a future House of Commons. That is the veriest platitude and does not carry us any further. The Attorney-General is the first to realise that there is a great difference between repealing a Bill and having to pass it again at the end of five years. If there is so little in the Amendment why does he not accept it? I can only add my protest to those already made in every quarter of the House. I believe that if the Bill is passed in its present form the Government will deal a damaging blow to the trading community and do enormous injury to the millions of people who use the railways. They will benefit nobody except themselves and the people to whom they gave the pledge which I believe everyone now regrets. The right hon. Gentleman says that Parliament is free to decide that question. The House will be free only if
  1354
  the Government take off the official Whips, and if they do that I have not the slightest doubt as to the result of the Division.
  Mr. ROWNTREE: Those of us who differ from the Government on this point are not trying to prevent the carrying out of the Prime Minister's pledge. That pledge was given at a time of hurry and commotion, and certain things were not thought of. The President of the Board of Trade admitted yesterday that the question of Ireland was not thought of, and we have had to make special arrangements in regard to that. The Attorney-General has just admitted that a limit of time was not mentioned. Surely it is right for the House of Commons to determine as to the length of time that this pledge shall be carried on. The Attorney-General said that it would be a simpler thing for those of us who objected to this proposal to repeal the Bill. But surely directly any Motion was made to repeal the Bill the representatives of the Government would say that a pledge had been given that could not be broken, and we should be in the same position as we find ourselves to-night. My fundamental objection to this proposal is that just at the time when the nation is increasingly in favour of giving a minimum standard of wages this House is practically saying: "When you raise your wages and give a minimum you are going to raise your cost of working." I consider that an absolute fallacy. When you give a decent minimum wage you are not necessarily raising the cost of that production. It is for that reason I am extremely anxious that there should be a time limit to this Bill, so that the question may be raised in the proper way at a future time. The statement I have made is borne out by the figures that have been quoted in respect to the takings of the railway companies for the last half-year. Many of the railway companies have done better than they have done for years. [An HON. MEMBER: "Forty years."] Yes, forty years. Many of them, I am glad to say, have been paying this higher rate of wages. Yet even so, many of them, I am glad to say it, have made a larger profit than for forty years. I think that that shows that those of us on both sides of the House that ask for a time limit are on solid ground. I ask the Government to grant us this request. In making it we are not, we believe, interfering with the pledge the Prime Minister gave.
  Mr. ROWLANDS: Earlier I presented a petition against this Bill from a number of traders, not only in my own Constituency, but throughout the country. I entirely agree with the sentiments of the hon. Member for York that we wish to see the Prime Minister able honourably to redeem his pledge. While we wish that we think there are certain conditions under which it can be done without in any way compromising his position. The acceptance of the time limit will not in any way interfere with the redemption of that pledge. The Amendment has not been read carefully enough. It says:—
  "This Act shall continue in force for five years after the passing thereof and no longer, unless continued by Parliament."
  "No longer unless continued by Parliament." There, to my mind, is the entire saving of the position of the Government. I endorse everything he has said as to the difficulty at any time of repealing an Act of Parliament when it is once upon the Statute Book. But if we had this time limit, then at the end of five years, when the question came up for reconsideration we could offer our criticisms, and, to my mind, what is far more important, you would have the railway directors anxious to facilitate the Government in dealing with the grievances of the traders. The grievances of the traders have to come up, and the sooner they are dealt with the better. That opportunity will arise if this Act is passed only for a period of five years. Therefore, as one who is desirous of supporting the Prime Minister in the redemption of his pledge made under difficult circumstances, when the minds perhaps not only of the Government, but of people throughout the country, were not in the most cool and deliberate state, I would appeal to the Government to accept this Amendment. We must stand by the Government in the carrying out of its pledge, but we have a right also to safeguard to the fullest extent the interests of the traders of the country, and also to see that whatever the traders have to pay goes directly into the pockets of the employés. I beg the Government to accept this Amendment It relieves the difficulty and I am sure it is only an act of justice to the traders of the country.
  Mr. JOWETT: Listening to the Debate on this new Clause one feels instinctively the truth of the remark made by an hon. Gentleman opposite that this Bill has no
  1356
  friends. Look where you will no hon. Member has a word in favour of the Bill. One naturally asks the question why on earth is the Government averse to accepting the proposition now before the House? The only reply I imagine that would meet the case is this that for once the hon. and learned Member for Waterford is not the dictator of the Government. It is the Noble Lord the Member for Kensington who is the dictator, and if the Government would simply go behind the Speaker's chair and persuade the Noble Lord to allow them to accept this new Clause they would please their followers as well as the Opposition
  Sir RYLAND ADKINS: I quite agree with the Attorney-General that there is a debt of honour to be redeemed, and if one ought not to be too meticulous in one's criticisms of the position of the Government, and if I understand my right hon. Friend aright I think he said there was no mention made in the negotiations with the railway representatives of the time limit. What does it mean? It means that it would be very unfair to the railway representatives to fix a time limit. I submit to the Government that there is nothing in the pledge which forbids the fixing of a time limit if there is a considerable period allowed to begin with. While we are all anxious to assist the Government in discharging the pledge which they gave in a moment of national crisis, I think it is desirable that the House of Commons should indicate that that pledge is really carried out by an arrangement which insures the matter coming up for discussion after a reasonable period without having to resort to the inconvenient method of moving to repeal the Act. I am authorised by the Member for Perth to say that if the Government would consent to the Second Reading of this Clause—there is no need to fix five years, and if the Government would accept six, seven, or eight years—[HON. MEMBERS: "Oh, oh!" "No," and "Four years."]—I still adhere to my argument that the real point is not exactly five years, but to have a period which ensures this measure automatically coming up for reconsideration at a stated period. I ask for some reasonable period. If the Government accepted this Clause, then it would be a matter for reasonable Debate exactly what the period should be. I associate myself with all that has been said as to the desirability of having a period fixed, but I say that it should be long enough to carry out the pledge of the Government.
  Sir NORVAL HELME: As one who belongs to the commercial classes I desire to say how thoroughly they appreciated the efforts of the Government at the time when the railway strike was paralysing the industries of the country, and knowing the full responsibility that rested upon the Government their decision was gladly welcomed when they promised the railway companies that on the advance of wages provision should be made for it by an increase of rates. Under these circumstances, while I recognise the loyalty of the Government in carrying out by this Bill their undertaking, I appeal to them not to go beyond that promise after the expression of opinion in this House. I think the Government would be well advised if they would meet the feelings which have been expressed, and by some arrangement let it be felt and recognised that there is a strong force of public opinion which has to be reckoned with.
  Mr. BUXTON: I wish to fully recognise the feeling of the House in this matter. I appreciate the loyalty of my hon. Friends to the Government, and I am sure that, as the Minister in charge of the Bill, they recognise that I have had a very difficult task. I am grateful for the kindness and the loyalty which has actuated those who have supported me, very often, I know, against their own desires. The Debate has developed very largely, and it has been entirely on one side. I have stated more than once that in my opinion the undertaking of the Government was a continuous one. But circumstances—[HON. MEMBERS: "Oh"]—Perhaps hon. Members will wait till I have done. The feeling of the House generally has to be recognised in this matter. A large number of hon. Members behind me, who up till now have given the Government their support, as also hon. Members on that side of the House, have appealed to us, without exception, to allow this Clause, or something similar to it, to be inserted in the Bill. I have, therefore, taken it upon myself to be in communication with the Prime Minister about it. He is unable to be here. He did not know this was coming on in this way, but he authorises me to say that in his opinion, if a limited time is fixed and it is understood by the wording of the Clause this Bill continues in the Expiring Laws (Continuance) Bill until Parliament otherwise directs, he would not consider in the circumstances that in any way a breach of the undertaking. I think the House will
  1358
  accept that. The Act will come to an end after five years, but the wording of the Amendment I would accept would show that after that it would be included in the Expiring Laws (Continuance) Bill till Parliament otherwise directed. I see opposite me some of those who have been interested in this matter and with whom I have had negotiations, and I would like to remind them I did myself point out that it is difficult to resist some period of years. I said I would resist it because I felt I was bound to resist it, and I would do it if I felt I could carry the House with me. It is clear that is not so. I have it from the Prime Minister that, with the conditions I have mentioned, the undertaking of the Government would be carried out, and, therefore, I shall be prepared to accept this Amendment if the words are in the direction I have indicated.
  Lord CLAUD HAMILTON: I acquit the right hon. Gentleman the President of the Board of Trade of any attempt whatever on his part to depart from the engagement into which the Government of which he is a Member entered with us in August, 191], but, after what he has said about the Prime Minister, I cannot aquit that right hon. Gentleman of an endeavour on his part to do that which I think is contrary to the honour of a statesman and the honour of an English gentleman—trying to depart—[HON. MEMBERS: "Oh!"]—yes, trying to depart from a solemn engagement—[HON. MEMBERS: "Withdraw."] I withdraw nothing—a solemn engagement which he entered into during the discussions between the right hon. Gentleman and the railway companies in respect to the Trade Unions dispute in August, 1911. The House will remember that the agreement was forced upon us against our will and against our better judgment. I was one of those—I do not mind saving—who never doubted for a moment that we had the country at our back, and that it would have supported us against an unjustifiable strike for which there was no possible reason whatever, so far as the railway employés were concerned. [An HON. MEMBER: "£1 a week." Another HON. MEMBER: "16s. a week."]
  When it was represented to us that if we did not come to terms with our men not only would national interests be involved, but we might be brought into international complications, we then, contrary to our convictions and better judgment, agreed, having regard to the interests of the whole

  1359
  community, to come to terms with the Government. In those terms no time limit was either suggested or mentioned. And now, because there is a show of opposition on the part of certain Gentlemen sitting on that side of the House, and a few hon. Gentlemen on this side of the House, the Prime Minister, who has not felt it his duty to come here during these three nights of Debate in redemption of his debt of honour—[Interruption]—not only to us, but to the country as well—he has not seen that it was his duty to come here except for ten minutes. He now sends a message, and instead of coming here in person, he delivers it to the President of the Board of Trade, that he thinks a time limit which was never mentioned in these negotiations is a proper thing to insert in this Bill. I say it is a gross breach of honour on the part of the Prime Minister. He departs, in making that proposition, from the solemn agreement entered into on behalf of the community of this country with the railway companies in order to terminate that strike. [An HON. MEMBER: "Toe the line."] So far as I am concerned, and the railway I represent, and the other railways, I believe, we will repudiate such a proposition on the part of the Government.
  12.0 M.
  Mr. HILLS: I wish the House would take itself back to August, 1911, when this strike was settled. Do Members know the circumstances under which the strike was settled? Do they know the pressure that was put upon the railway directors and managers to settle that strike? Let them ask themselves—if at that time a Bill had been brought forward immediately, and that Bill was limited to three or five years, would anybody have regarded that as a redemption of the pledge of the Government? After what we have heard, after the speech of the President of the Board of Trade, I should like to know, what becomes of the eloquent speech of the Attorney-General? He said, truly, in that speech that there was no time limit needed. In his speech he appealed to the House to pass this Bill as being only a redemption of the Prime Minister's pledge. I quite accept the fact that there is a strong feeling in some quarters of the House against the Bill; I do not quarrel with that; but is not a debt of honour higher than a feeling of that sort? The Attorney-General's words are far more eloquent than any I could use to tell the House that the only way to redeem that
  1360
  debt is to pass this Bill. Now the House is told that there is an easier way to escape from that debt. They know they are not paying that debt. They know, as the President of the Board of Trade has said, that the pledge given by the Prime Minister as the responsible head of the Government and of the Liberal party was a continuous pledge. They know very well there is no time limit. When you say you will do a thing, you do not mean you will do it for a certain time, you mean you will go and do it, and that that pledge is to be redeemed. I ask the Government, and I ask the Liberal party, when is a promise not a promise? When its fulfilment is inconvenient. I hope the House will redeem its own honour, for its own honour is involved in this question.
  Mr. J. H. THOMAS: I did not intend to take part in this discussion, but having regard to the last two speeches it is well that the House should know something else about the 19th August than has ever yet been stated, even by me. It is quite true, as the noble Lord (Lord Claud Hamilton) said, that pressure was put upon the railway companies.
  Mr. HILLS: Upon both sides.
  Mr. THOMAS: It is equally true that pressure was put upon us. [AN HON. MEMBER: "By the military."] On the 19th August we had, at two o'clock in the afternoon, five of the trunk lines of this country absolutely paralysed.
  Lord CLAUD HAMILTON: By intimidation.
  Mr. MacVEAGH: Listen to an Ulster Orangeman on intimidation.
  Mr. THOMAS: I will answer that intimidation at once. Let us see exactly what the intimidation was. I have said, and it is assented to, that on the 19th August these men were out. This is a copy of a circular issued on the 16th August by the hon. Baronet's company; it is similar to that which was issued by every other railway company as private and confidential to their station masters:—
  "Great Northern Railway. The Government having assured the railway companies that they will provide ample protection to enable them to carry on their services, the railway company will, in the event of a general strike, give an effective though restricted service to the public, and to this end the Great Northern Company rely upon the local support of their staff."
  Three days before the strike here was the pledge given of the military

  1361
  by the Government. Then we talk about a debt of honour to the men? Let me follow that for a moment. The strike was not justified, the Noble Lord said. Let us see. Three times in this House in 1910 and 1911 I myself begged and pleaded with the Board of Trade to do something to compel the railway companies to keep their contract. I, in face of the hostility of the men, in face of demands for my resignation, in face of condemnation from all quarters, said I am going to stand for conciliation. I know conciliation was in danger. I wanted to give conciliation a chance, and I pleaded with the Government to take some strong line which would compel the railway companies to observe that contract. The hon. Member (Mr. Hills) remembers that he had to try and defend his own company when an arbitrator had given an award of 20s. a week to carmen, and by a subterfuge they employed casual men in order to give them 19s.
  Mr. HILLS: That is entirely untrue. The charge was made and I contradicted it, I believe to the satisfaction of the House except the hon. Member.
  Mr. THOMAS: I am speaking within the recollection of the House. The answer of the hon. Gentleman was that the statement made by me was not borne out by the evidence that he then had, but on further inquiry his company altered it at his own request.
  Mr. HILLS: No, no.
  Mr. THOMAS: Let us see about the debt of honour. If the Government was under a debt of honour in this matter what, again becomes of the hon. Gentleman's company? Last week a Commissioner re-ported—
  Mr. SPEAKER: I fail to see what this has to do with the question of limiting this Bill to five years. It is raking up old scores.
  Mr. THOMAS: I most certainly would not have introduced it were it not for the noble Lord and the hon. Member.
  Mr. SPEAKER: They were surely entitled to point out that at a certain time a promise was given and was not, in their judgment, being kept, but I do not see that the hon. Member is relevant in going into other matters which preceded the particular promise which was then made.
  Mr. THOMAS: I am submitting that when the promise was made by the Government, which the hon. Member accuses the Government of breaking, the Government were equally responsible to them for another promise that I am saying has been broken on their side.
  Mr. SPEAKER: How does that affect the question of limiting the Bill to five years? That is the point now.
  Mr. THOMAS: I was led to believe that the debt of honour was included in the five years. At all events I will not pursue that question further than this. Coming to the question of the five years let us see exactly the situation. There was no agreement made that August beyond 1915. Let that be perfectly clear. No matter what the Board of Trade or anyone else says. I challenge anyone to deny that there is any agreement fixed up by any railway company in the country which goes beyond 1915. That in itself is twelve months beyond the period of the conciliation scheme. I do not hesitate to say I hope the conciliation scheme will continue, but I am not unmindful of the fact that there are thousands of railwaymen at this moment anxious to break it up, because they feel that they are not getting fair treatment. We want conciliation. We want this scheme to continue. Supposing this proposal is carried—and I now realise that it is accepted by the Government—what happens? You are in this more fortunate position. In 1914 new agreements will be made. When these new agreements are made the railway companies will be in a position to say to the House when this Bill is reviewed here: "Here are fresh contracts which impose further responsibilities upon us." I submit that it is the strongest possible argument for the Government accepting this particular Amendment. I hope it will not be necessary to refer to the events of August, 1911. I wish it to be distinctly understood that, whatever pressure was brought to bear on the railway. companies, there was, as I know, equal pressure brought to bear on the representatives of the men. We who were in the position of leaders did something in defiance of our men. We have felt that there was an honour and duty attached to us, and we have fulfilled our obligation. I hope that, whatever the result of this Debate may be, the railway companies will recognise their obligation, because, if they do not, the conciliation scheme, or any other scheme, will not prevent what happened before.
  Sir FREDERICK BANBURY: The right hon. Gentleman has agreed to a course which has taken me by surprise. He has had considerable negotiation with the representatives of the railway companies upon this Bill. The representatives of the railway companies informed him two or three days ago that if they accepted the three Amendments he carried yesterday, it was on condition that he would refuse any other Amendments to the Bill. That being so, the right hon. Gentleman indicated last night that he would accept a further Amendment in breach of the agreement which he had arrived at with the representatives of the railway companies. Those representatives met him this afternoon, and being anxious if possible to come to a peaceable solution, they made a proposal which was accepted by the right hon. Gentleman at six o'clock this evening in the Foreign Secretary's Room, but not one single word was said about any other Amendment being accepted, and we left the room under the impression that he would stand or fall by the agreement at which he had arrived. That is the plain fact as to what has taken place. Under those conditions we are, of course, in a very difficult position, and I really cannot say, speaking only as an individual member of my board, what we ought to do, but my own belief is—[HON. MEMBERS: "Withdraw the Bill," and "Refuse to accept the Bill."]—my own belief is that we ought to say to the Government that as they have failed to carry out their pledge we will have nothing more to do with it. I cannot take that responsibility upon my shoulders myself, and I am inclined to think that the real course which we ought to follow is to adjourn the Debate.
  Mr. MacCALLUM SCOTT: I listened with very close attention to the somewhat incoherent remarks of the Noble Lord and English gentleman who made such a violent attack on the personal honour of the Prime Minister. I was endeavouring to understand what he imagined to be a breach of faith or a broken pledge. The Government promised to introduce this Bill. It has introduced the Bill, and has recommended it to this House, and has used its influence in the strongest way with this House. There has been considerable reluctance on the part of many Members on both sides to accept this Bill, but the House is accepting the Bill. This has been a very crowded Session. We are meeting in exceptional circumstances. I do not suppose
  1364
  that the Noble Lord will deny that this Bill is a measure of first-class importance, involving great interests and deserving of the fullest discussion. We are not able to give it full discussion this Session. We are not able to consider it fully on its merits and discuss all those important aspects. Yet, without considering it fully on its merits, or discussing all those important aspects which ought to be discussed, the House has been willing to pass this measure. But no Government, no Cabinet, by any pledge which it can give, has any power to bind this House. If this House thinks that the lines of this Bill are deserving of further consideration, the House, while fulfilling the Government's pledge in passing the Bill, has got a perfect right to insert in this Bill a statutory provision securing that at least in five years there will be another opportunity of considering the lines on which the Bill is framed. I submit that the Government has absolutely and fully fulfilled its pledge and that its honour stands unshaken in the matter.
  Question, "That the Clause be read a second time," put, and agreed to.
  Clause added to the Bill.
  Mr. GEORGE TERRELL: I beg to move, after the word "charge," to insert the words "for the carriage of goods other than agricultural produce, products of the United Kingdom."
  I do not wish to repeat the arguments used when moving this Amendment in Committee; but there was a great deal of misunderstanding as to its effect on the part of hon. Members opposite. I think even the Chairman of the Committee regarded it to some extent as an Amendment involving the fiscal question. It is nothing of the sort. Objection was taken on the opposite side that this was a protectionist Amendment seeking to protect agriculture in preference to other industries. One hon. Member suggested that cotton should be likewise excepted, and another suggested coal, while the Attorney-General, who is very capable in avoiding difficult issues, suggested biscuits. This Amendment simply seeks to put agriculture on the basis on which it is at present, so that by the passage of this Bill it should not be hampered in any way. The ground which I took was that in regard to agriculture there were at present certain rates for the carriage of agricultural produce from inland towns to

  1365
  London; that there were certain through rates from continental towns which involved carriage by sea and by land to London; that for the continental trade there was a great deal of competition between the different railway companies, who own their own lines of steamers; and that, if this Bill is passed, the rates for continental produce would remain exactly as they are at present. That seems to me the only outcome of the Bill in its present form. I pointed out to the Committee that agriculture in this country was an industry heavily taxed in many directions, that any fresh burden put upon it would react on the agricultural labourers, and that it was a poor way of showing sympathy for them if we were by this Bill to put them at a disadvantage in regard to foreign competition.
  I ask for no Protection, but I do ask that the agriculturists, and particularly the agricultural labourers, who would be hit by this Bill, should not be put in a worse position than they are to-day. That is a request which I again repeat to the House; in fact, I will carry it a stage further, and ask the President of the Board of Trade whether he will deal with it in this way, that any increase which is put on the rates for British goods from inland towns to London should be similarly put on the through rates for continental goods sent to London. To illustrate my case, the rate paid on English milk from a town like Chppenham to London is 1s. 5d. per churn; the rate from France to London is 2s. 6d. If by the operation of this Bill the rate from Chippenham to London was increased to 2s., then I ask that the increase of 7d. should be put on the through rate from France to London. That is reasonable, it is only fair, and if you do not do it you put agriculturists at a greater disadvantage than they are in to-day in dealing with foreign competition, and you will also lessen their chance of increasing the pay of the agricultural labourer, which to-day does not represent a fair living wage. I appeal to the President of the Board of Trade, I appeal to hon. Members below the Gangway opposite, who profess to represent the interests of labour, and who are anxious enough so long as that labour is of a trade union character. They are full of sympathy for their fellow trade unionists, but I am afraid they have very little sympathy for the down-trodden agricultural labourer. Every vote given in opposition to this Amendment will be a vote hitting the
  1366
  agricultural labourer. It will be carefully watched. When hon. Members start their land campaign—
  Mr. SPEAKER: The hon. Member must confine himself to the Amendment.
  Mr. G. TERRELL: The Amendment speaks for itself. I trust that the President of the Board of Trade, having given way in regard to Ireland, and in regard to the time, will see his way to give some concession to the agricultural interests which I have at heart.
  Mr. PETO: I beg to second the Amendment.
  The argument generally used on the other side was that if exception were made in favour of agriculturists, similar exceptions would have to be made for other trades. I think that agriculture is in a peculiar position, and that we are justified in asking that, at any rate, the agriculturists of the United Kingdom should be regarded from an exceptional standpoint. The Members of the Labour party realise fully in this Bill what I think has not been fully realised by the Government, namely, that it is not in the interests of the wage-earning classes to pass a Bill which will impose fresh burdens on the trade of the country and so tend inevitably to diminish employment. That argument is irresistible in its strength when you 'apply it to this particular case of agriculture. It is desired by all parties in the House to increase the intensive cultivation of land and the number of people who are cultivating the land. Therefore, if you carry out that intention there will be a larger number of very small men producing those provisions referred to in the Amendment, and the average producer will therefore be less able to compete with the great railways and to defend himself against this proposed increase in rates. It is precisely upon small consignments of agricultural produce that the rates press most heavily to-day, and therefore, any general increase in rates will inevitably press much more hardly upon the small trader generally, and the small agriculturist in particular, who is not able to consign very large quantities of goods to the railway company. Therefore, I hold that there is an entirely separate case to be made out for agricultural produce—which is needed by the wage-earning classes, who have, not only as possible members of the agricultural community but as consumers of this produce, a direct

  1367
  and personal interest in seeing that there is no increase in the cost put upon it by increased rates charged by the railway companies and it is on that ground that I feel justified fully in seconding this Amendment.
  The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. J. M. Robertson): Both the mover and the seconder of this Amendment have, I think, themselves indicated that it is not possible to accept this Amendment. Members on both sides of the House who are in full sympathy with the claims of agriculturists have made it clear that they could not assent to a reservation in the case of agriculture, and that if agricultural products were to be removed from the scope of this Bill they were bound to raise the claims of their constituents engaged in other industries. Hon. Members who represent districts famous in the cotton industry, for instance, point out that if agriculture is to be given special facilities under this Bill they would have to make a similar demand for everything connected with the cotton industry. If one industry is to be reserved from the operation of the Bill, obviously all the other industries will make the same claim, and this absolute antagonism of interests all round must, I think, be recognised as making the acceptance of this proposal impossible. It really cannot be accepted.
  Mr. CLYNES: So many appeals have been made by the mover and seconder of this Amendment that I rise just to say that we have our definite point of view as to how railway companies should be treated in respect of charges imposed upon this or any other industry. If the wages of postal employés are increased we are not expected to pay more for our stamps, and if the conditions of railway servants are improved you should not permit the railway companies to impose additional charges upon the goods they carry. The remedy for this is the Labour party's remedy of making railways national property like the Post Office.
  Mr. G. TERRELL: I beg to withdraw the Amendment.
  Amendment, by leave, withdrawn.
  Mr. C. BATHURST: I beg to move, in Paragraph (c) after the word "whole" ["is not, in the whole, greater"], to insert the words, "having regard to all relevant circumstances."
  1368
  This was a matter debated at some little length in Committee upon a similar Amendment moved from the other side of the House, and the only difference between the Amendment moved by the hon. Gentleman opposite and the Amendment which I am now moving is the insertion of the word "relevant," in consequence of a suggestion that was made by the Attorney-General in the course of his speech on that Amendment. It is perfectly clear that this proposal, at any rate, is not one that conflicts in any way with the pledge which the Government gave to the railway companies. In fact, so far from conflicting with the pledge which the Government gave, unless the Government intend that all these relevant circumstances shall in future, as in the past, be taken into account, they will in fact be stretching their pledge in the interests of the railway companies and against the interests of the traders, so as to inflict a quite unnecessary and unjustifiable burden upon the traders of the country. I should like to ask the Government whether they do intend by the Amendment which they propose presently to move, assuming this is defeated, to go beyond the undertaking given, and to limit the discretion which has hitherto been exercised by the Railway and Canal Commissioners in dealing with the question whether an increase of rate is or is not justified. It is common knowledge that in the past there has been the power to take into account all the circumstances, including the economies which, as has been pointed out in this Debate, can so well be effected nowadays, in reduced cost of raw materials, or in other ways, including even railway amalgamation and working agreements between one company and another.
  These are circumstances which have been taken into account in the past, and we ask that they shall be taken into account in the future. The President of the Board of Trade, speaking yesterday upon a similar Amendment, assured us that they would be taken into account. The right hon. Gentleman has an Amendment which I for my part would be quite willing to accept, but the right hon. Gentleman is not going to move it. He has met the railway directors, as the hon. Baronet has already explained, at six o'clock last evening in the Foreign Secretary's Office with the result that he proposes to move a different Amendment, for kindly allowing me to see which I am bound to thank him. After consultation

  1369
  with my friends I must say that it does not carry out the purpose of the original Amendment put on the Paper, and does in fact carry out what the railway directors claimed in this House the other day under this Bill, and which we as traders entirely repudiate, unless it is intended to go outside the jurisdiction hitherto exercised by the Railway and Canal Commissioners. I would like to remind the House quite shortly what the right hon. Gentleman told the Committee on this matter to show that the new Amendment of the right hon. Gentleman does not quite tally with the assurance which he gave to the Committee. Either my Amendment or the Amendment of the right hon. Gentleman is going to be carried, and we have to choose between the two.
  Mr. SPEAKER: I would point out that if the hon. Member's Amendment be negatived, that, of course, disposes of the question, and no other Amendment on the same subject can be proposed.
  Mr. C. BATHURST: I am very grateful to you for putting it in that way, for I sincerely hope my Amendment will be carried and the right hon. Gentleman's Amendment will not be brought in.
  Mr. SPEAKER: There is the danger that if the hon. Member's Amendment be negatived, the subject matter cannot be introduced in the Bill.
  Mr. C. BATHURST: I think, Sir, you will agree with me that it will be quite impossible to discuss this Amendment without also taking into account the proposals which the right hon. Gentleman is going to submit to the House.
  Mr. SPEAKER: That is the very reason why I say that if the hon. Member's Amendment be negatived, we cannot afterwards take the Amendment of the President of the Board of Trade, and, therefore, the hon. Member is prejudicing it by moving his Amendment.
  Mr. C. BATHURST: If I understand your ruling, Sir, and your advice to be that I should withdraw my Amendment with the possibility of effecting the same purpose by possibly amending the right hon. Gentleman's Amendment, I will save the time of the House by asking to withdraw. I, therefore, ask leave to withdraw the Amendment on that footing.
  Amendment, by leave, withdrawn.
  Mr. BUXTON: I beg to move after the word "justified" ["increase of rate or charge as justified"] to insert the words "Provided that nothing in this section shall be construed as preventing the Commissioners from taking into account any circumstances which are relevant to the determination whether an increase of rates or charges is or is not greater than is reasonably required for the purpose of meeting the said rise in the cost of working."
  I am glad the hon. Gentleman has withdrawn his Amendment because if negatived, as it would have been, I should not have been able to move this Amendment. The House will remember that we discussed this question as to how far the Bill, as drawn, carried out what undoubtedly we had in our minds, namely, to make it clear that, in considering the increase of rates due to the increased cost of wages and improved conditions of labour the Commissioners would have full discretion to take into account relative circumstances. That was the object we had in proposing this proviso, as I stated clearly to the House more than once yesterday. The hon. Member said it did not carry out the intention. He had some suspicion in his mind that it had been doctored or altered or whittled down by the railway directors. I can assure him that while I naturally, and I think properly, discussed its terms with the representatives of the railway companies, I afterwards submitted it to the hon. Gentleman himself and gave him a copy of what I intended to propose. My right hon. Friend last night read the words which appear on the Paper, but said that he did not commit himself to them. We altered the words into those I will read in a moment, but I can assure the hon. Gentleman that the intention is the intention expressed last night, and if he is "smelling a rat," I can assure him there is not the minutest mouse in this Amendment to which he need object. We want to make it clear that in considering a rate under this Bill the Commissioners will be entitled to consider all relevant circumstances just as they can at present in regard to the increase of any other rate. If the hon. Gentleman can show that these words do not carry out that desire, we shall be very glad to consider any remarks he has to make. I will move the Amendment in these words instead of in the words on the Paper. There is no real material alteration, and we consider that they more accurately carry out the intention.
  Mr. BARNES: Do not these words imply that the Commissioners, if they think proper, can consider that the railway companies may sustain a claim to make up from the traders the whole amount of any increase of wages that may be given? That would in my opinion be the interpretation likely to be put on the words, and if so it seems to me that instead of being an improvement on the words on the Paper they are really going back to the position which existed before the words on the Paper were put down.
  Sir RUFUS ISACS: There really is not any alteration in that sense. The first words in the Amendment now propos3d, "Provided that nothing in this Section shall be construed as preventing the Commissioners from taking into account any circumstances," are exactly the same as they appear on the Paper, and then it goes on, "which are relevant to the determination whether the increase of rates or charges is or is not greater than is reasonably required for the purpose of meeting said rise in the cost of working." That is exactly what is intended and what we said last night. The only point raised was that there might be some doubt or ambiguity. We put the words in so that there should be no difficulty about it, and we have taken the words bodily from the preceding Sub-section.
  Mr. C. BATHURST: I beg to move to leave out from the proposed Amendment the words "for the purpose of meeting the said rise in the cost of working."
  I may remind the House that last night the railway directors in this House were extremely apprehensive when the Attorney-General adumbrated the Amendment which he has now put down in this particular form. The hon. Member for Durham (Mr. Hills)—I regret he is not present—said in so many words that what the Commissioners should consider was, what amount should be added to the charges which the consignors of goods would have to pay as representing the equivalent of the amount which would be added to the remuneration of the employés of the railway companies—in fact the very point which has just been put by the hon. Member for the Blackfriars Division of Glasgow. In affect this will be the instruction to the Commissioners, that in future they must not use their discretion in considering all the circumstances which may make for economy on the railways and which have hitherto been credited to the account
  1372
  of the trader when these matters were under consideration, but that they must limit their consideration to the actual amount by which the employés' remuneration has been increased, and by that full amount they will be justified in adding to the charges imposed on the trader. That is exactly what the railway companies want, and that is exactly what we, as traders, do not want them to have, because it will very seriously limit the jurisdiction of the Railway Commissioners, as hitherto exercised in the interest of the traders of the country.
  I move to omit these last words in order to leave the Amendment substantially as it was moved by the hon. Gentleman opposite and afterwards put down on the Paper by the Government. If you are going to add these words you are asking the Railway Commissioners to take into account those circumstances which are relevant to the determination of the increase which is reasonably required "for the purpose of meeting said rise in the cost of working." "Said rise in the cost of working" is the rise which is consequent on an addition to the remuneration of the railway employés. It is exactly what we traders say is unfair. We say that in the future as in the past, the Railway Commissioners should have absolute latitude and discretion in considering all the circumstances of the case, and in giving to the traders, to some extent, the benefit of the economies the railway companies are able to effect; and that you should not impose on the traders the whole of the additional cost which may be considered as resulting from an increase in the remuneration of the employés. It is a technical point not at all easy to put to the House. If the House could get this Amendment down on a sheet of paper, they would see that these last words do, in effect, limit the discretion of the Railway and Canal Commissioners to the detriment of the trader and to the advantage of the railway companies.
  Mr. GRETTON: I rise to second the Amendment to the proposed Amendment.
  I think I can put the point of view which I hold very shortly to the House. Clearly these words would not be inserted unless there was some reason, and the reason is that there has been a conference. We are entitled, on that account, to look rather carefully at the meaning that would be attached to this section. This proviso is intended to give a discretion to the Commissioners. These

  1373
  words clearly do, as my hon. Friend has just said, limit that discretion. They take away with one hand what has already been given with the other. I want to point out that this seems to me to be the crux of the whole matter, and that these words, which we want to omit, prejudge the case. They assume that a rise has taken place in the cost of working, when, as a matter of fact, that is exactly what the Commissioners have to judge. There need be no rise in the cost of working resulting from increase of wages, because economies may be effected in the management and other directions. But these words assume that that rise most necessarily take place, and they confine the consideration of the Commissioners in determining how far the rates may be raised, to one ground alone, namely, that of the railway companies proving that they have given higher wages. With these words attached to the proviso, no other circumstances can be considered by the Commissioners under this Bill. I look, in the first place, with great suspicion to the word "relevant." It might be held by legal construction that the word "relevant" might be relative only to this Bill, and that no other circumstances outside the four corners of the Bill would be considered relevant in considering the matters with which the Bill deals. But that, at any rate, is a rather finer point, and, as I am not a lawyer, I do not propose to argue it. We have a clear issue; these are limiting words which are going back, as we contend, upon what the House, in all except one quarter, agreed to last night, and therefore I contend that these words should not be passed.
  Sir RUFUS ISAACS: I cannot help thinking that we should not have had this discussion had it not been for the fact that the words have been inserted as the result of some discussion with the directors, and are therefore looked upon with some suspicion. If these words are considered, however, it will be seen that they do nothing except make quite plain what we said last night, and what we intended. The proviso says that the Commissioners shall not be prevented from taking into account any circumstances "which are relevant to the determination whether an increase of rates or charges is or is not greater than is reasonably required for the purpose of meeting the said rise in the cost of working." What is the purpose? It is "of meeting the said rise in the cost of working." Consequently, all the Commissioners have to do is to remember all
  1374
  relevant circumstances in order to determine whether the increase is greater or not greater than is reasonably required for the purpose, exactly as it would have been if the Amendment of the hon. Member for Wilton (Mr. Bathurst) had been carried. That is the purpose; there is no other purpose dealt with in the Bill; it is the purpose of meeting the rise in the cost of working. The hon. Member will see that there is really no division of opinion between us. We mean exactly the same thing. If I had introduced the words last night there would have been no discussion. It is all due to the odour of suspicion that clings round the result of conferences. These words neither add to nor take away; they satisfy the directors; and they make plain what the intention of the Bill is. What we are doing is carrying into effect what the hon. Member for Wilton desires.
  Sir ALFRED MOND: Owing to the Amendment not being on the Paper, we are in a little difficulty in snaking up our minds on this drafting point. I regret that the President of the Board of Trade did not find it possible before this discussion to give us a draft of his Amendment so that we could have discussed it previously. A great deal of trouble would thus have been saved. I, personally, cannot see that very much is bound up in the matter. It seems to me quite unnecessary to add the words. The word "purpose" must refer to something, and the only thing it can refer to is plain. I do not think the whole Amendment makes much difference to the Bill, one way or the other. Nobody can say what view the Commissions may take on the point until it comes to be interpreted by them. I do not wish to commit those I act for in any way. As we have not seen this Amendment before, we do not wish to enter any objection to it if the Government say it carries out the arrangement made last night.
  1.0 A.M.
  Mr. WATSON RUTHERFORD: It was understood, at all events by some of us, that as a result of the very exhaustive discussion that took place last night on this point, that these words would be left out by the Government on Report. It is very difficult, at a moment's notice, on a manuscript Amendment, for those who are not used to looking carefully at the effect of the exact wording, to see what is the precise idea which has called forth this

  1375
  counter-proposal which we have here to-night from the Government. But, if you look carefully at the words, and look also at the place where it is proposed to insert them in the Bill, I think it will be fairly obvious that there is a very great distinction between the one set of words and the other. If there was no great distinction between the one set of words and the other, why propose the words to-night that have been changed? I think it is fairly clear why these words are proposed in a different shape. There are two reasons. One is that they mean something altogether different, and the other is that they are the result, as we now understand, of a conference which the Board of Trade has been having, in the course of this afternoon, with the railway companies.
  I think the House is very tired of listening to the question of broken pledges, but here we have got another illustration. The pledge that was given last night was that words would be introduced on Report by the Government, and those words were practically settled in the form in print on the Paper. [HON. MEMBERS: "No."] The meaning of those words was this, that when the Commissioners came to deal with the question of what the amount of increase should be on the rates, they were not merely to take into account the extra wages that were being paid. but should take into account all kinds of surrounding circumstances, which bore on the question as to whether or not that was a fair increase. I understand that that was the effect—and not only the effect, but the actual words—of what the Government last night undertook should be inserted upon Report here, now.
  When we look at the words now proposed by the Government, we find that they have been carefully altered this afternoon, so that when this alteration is taken into consideration, the Railway Commissioners will be bound to give, notwithstanding any other outside facts, as much increase on the rates as they actually have given in wages. That is to say, the whole effect of taking additional circumstances into consideration is wiped out again by the altered words, and I think the House, if it really did consider this question on the merits, would see two things—first of all, that the Government has broken the pledge that was given last night, deliberately broken the pledge; and secondly, that the effect of the altered words is this, that no other outside circumstances would really be taken into con-
  1376
  sideration at all in allowing the increase, but that the whole of the increase in wages would be represented by the increase in rates. Some very strong language has been used, which some of us have listened to, already in this Debate, but it seems to me that not a single word of that language was too strong to express, in proper words, one's opinion of the course that is now being adopted over this Amendment. It is the same kind of thing, exactly. Here we have the President of the Board of Trade; when the railway directors came to see him this afternoon, he did what they wanted. When he was here last night, face to face with the commonsense of the Committee, he agreed to what the Committee wanted. He gave us a pledge last night, which did not prevent him from eating that pledge this afternoon.
  Mr. DEPUTY-SPEAKER (Mr. Whitley): We are now supposed to be discussing an Amendment to the proposed Amendment, to leave out the concluding words. I do not see how you can raise any general question. It is strictly the more technical question.
  Mr. WATSON RUTHERFORD: I agree it does seem to raise a very technical objection, but when you come to look at the meaning of it, you see that by leaving out these words the whole sense and the meaning and benefit that was intended to be got from the words agreed to last night is being taken away. I think it is a disgraceful proceeding, and one which ought not to be allowed.
  Mr. BUXTON: I do not know what the hon. Gentleman has in his mind. Can he explain in what way this differs from the undertaking which I gave to the House last night? In our opinion, it is exactly the undertaking we gave last night. The House knows, and the hon. Gentleman, if he was here last night, must know quite well, that, the words my right hon. Friend read last night were words carefully thought out. The hon. Member said that my right hon. Friend was practically reading the words to the Committee last night, but if he was here—
  Mr. WATSON RUTHERFORD: I was.
  Mr. BUXTON: Then he knows quite well that he was reading words drafted on the spur of the moment, and he would certainly alter them—
  Mr. WATSON RUTHERFORD: He is too clever for that—
  Mr. BUXTON: Then it is no good arguing with the hon. Member.
  Sir A. MARKHAM: I do not want to detain the House at this late hour—[HON. MEMBERS: "Divide! divide!"]—but when hon. Members call "Divide, divide," they should remember that this is a question affecting great industrial interests, affecting important organisations, and all the trading interests of the country. The Government have put down a manuscript Amendment, and that at the last moment, which hon. Members have not had the time to read. They could have had this Amendment printed long since, and have put it into our hands. I submit to the Attorney-General, and to the House, that when the Government are passing legislation in this drastic form they should give the traders of this country an opportunity of seeing these Amendments on the Paper, so that we can refer them to our own Solicitors. I am not a lawyer, but I am called upon, at the last moment, to construe an Amendment which I do not understand, and it is for this purpose that I want to get a reply from the Attorney-General. I have a copy of the Amendment, and, so far as I understand it, it means this, that the Commissioners will have to determine whether an increase of rates or charges is or is not greater than is reasonably required for the purpose of meeting rises in the cost of working. Does not this clearly mean that any savings that railway companies may make by amalgamation or by increased economies is not to form part of the decreased cost or the benefit that the railway companies are to be given. The traders will have the burden, and what the Commission only have to have regard to is the increase due to the increased cost to be paid for labour. Let me remind the House of what the President of the Board of Trade said last night. It was as follows:—
  "Mr. C. Bathurst: Do I understand it is not intended by this Bill to fetter the existing discretion of the Commissioners in taking into account such economies?"
  "Mr. Buxton: The words I used were that, as regards the 'unreasonableness.'"—[OFFICIAL REPORT, 12th February, 1913, col. 1055.]
  Mr. BUXTON: It should not be "unreasonableness," but "reasonableness."
  Sir A. MARKHAM: Very well, if that is a misprint that will explain the matter. Will the Attorney-General tell us whether it is definitely clear to his mind and to minds of his colleagues sitting by slim that if a complaint has been made by
  1378
  a trader as to a charge being excessive the Commissioners will have regard to the fact that the trader is saving money in other directions by other economies, and that the trader is entitled to say "you are not to have any increase of rates because you have increases in other directions."
  Sir RUFUS ISAACS: Certainly I can give my hon. Friend that assurance. The Commissioners are entitled to take into account all the circumstances which will determine this particular point. What they have to do, according to this Amendment, is to take into account the circumstances which are relevant in order to determine whether or not the increase is relevant or not. They are entitled to take into account all relevant circumstances. We have provided that all relevant circumstances should be taken into account after full consideration. We say in plain terms that nothing in this Bill shall prevent their taking into account all relevant circumstances. I hope my hon. Friend will accept that.
  Mr. PETO: By putting in the words which the Attorney-General now proposes he does not deal with the main question that is put to the Commissioners as to whether taking into consideration all relevant circumstances relating to the case, an increase is justified or not. What I want to provide is that consideration should be given to the question of whether an increase of rates and charges is or is not justified or whether it is or is not greater than is reasonably required, I think that is essential I think if the Attorney-General is going to give us this Amendment it is absolutely essential that it should be altered in some manner or else it should be inserted as we ask at the end of Sub-section (c).
  Mr. HIGHAM: I think the Clause as amended by the President of the Board of Trade is clear and definite, and I think the misconstruction that has been placed upon it arises from dwelling too much on the last two lines and in not noticing the first two lines of the Clause. The present law has been made very clear. In one of the celebrated cases Mr. Justice Wright distinctly said that if it is shown that all elements of cost and economy have been taken into consideration they have the power to deal with it. It combines cost and economy, and in all cases they have dealt with it on that basis. Last night the Committee had fear that under paragraphs (a), (b) and (c) of the Clause the

  1379
  element of economy would be omitted by the Commissioners, and the Amendment brought in by the President of the Board of Trade is to obviate that fear. I think it does clearly obviate it. It says distinctly "Provided that nothing in this section shall be construed as preventing the Commissioners from taking into account any circumstances which are relevant." Now they will decide whether circumstances are relevant and what economies are relevant. Therefore, this Clause automatically protects the traders.
  Mr. C. BATHURST: I ask leave to withdraw my Amendment, as I am quite sure the House is not in a position clearly to understand the point.
  Amendment to proposed Amendment, by leave, withdrawn.
  Question again proposed, "That the words proposed be there inserted."
  Mr. PETO: I beg to move at the end of the Amendment, to add the words, "or is justified." I want to make it perfectly clear that what is contemplated in the Amendment is not only the question of a greater or less increase in rate, but whether any increase in rate is justified or not. These words might perhaps read better earlier in the Amendment, where I first suggested them, but if they are not inserted you are not leaving to the Railway and Canal Commissioners whether, when they have considered all the circumstances, there is any increase justified at all. If the words remain as they are, it assumes that a rise of some kind is justified, and it is only a question whether the rate claimed is greater than is justified under the circumstances.
  Mr. C. BATHURST: I beg to second.
  Sir RUFUS ISAACS: These words are quite unnecessary and out of place, because if the hon. Member will look for a moment he will see that the proviso comes in after the various conditions which are laid down by the Bill, and all that the proviso does is that when these conditions have been satisfied, there comes the next question whether an increase is greater or not as is reasonably required for the purpose, and then they have to take into account all relevant circumstances in order to determine that. The proviso preserves to the Commissioners the discretion which is vested in them for that purpose.
  Mr. PETO: Does the right hon., Gentleman mean that they must hear the case without taking these circumstances into consideration, and that only after the increase is found to be justified they are to consider the relative question of economy?
  Amendment to the proposed Amendment negatived.
  Proposed words there added.
  Mr. BARNES: I beg to move after the word "justified" ["or charge as justified"] to insert the words "Provided that the improvements made shall be published by the Commissioners, giving the rates of wages which had been paid to the different sections of the staff and the increase which had been held to justify the increased rate or charge."
  I have put down this Amendment again to-day mainly for the purpose of getting some more explicit information from the President of the Beard of Trade as to his intentions. Last night we discussed the matter upon its merits, and from what I could glean from the House on both sides there was a very general desire that this information should be obtained somehow or other. I know this Amendment of mine does not carry us very far, because it would only give us the rate of wages paid before and after the change in those cases where traders brought forward a complaint; but I understood from the President of the Board of Trade last night that he was willing that the Board of Trade should publish some figures relative to the rates of wages on the railways generally, and I can only say now, that if I understood him rightly and he is willing to carry out that promise, as I understood it, I for my part would not press this Amendment.
  Mr. WATSON RUTHERFORD: I beg to second the Amendment.
  Mr. BUXTON: Last night I suggested that we should endeavour to obtain as far as we could the information which is desired in connection with the rise in wages and improved conditions under this Act and under the Conciliation Boards, which two, of course, go together, and that I should publish from time to time as official the information and the results of the Conciliation Boards, and, so far as is thought advisable, the judgments and reasons given by the Commissioners, and any other information available. I am not now in a position to say to what that infor-

  1381
  mation will amount. Though I cannot exactly indicate at the present moment the extent of that information, I am certainly anxious to go as far as I can.
  Mr. BARNES: Will the right hon. Gentleman say what he means by "so far as is advisable"? Surely it is in the interests of everyone that the facts that emerge from the Conciliation Boards should be published.
  Mr. BUXTON: I was not aware I said that. What I said was in connection with the judgments of the Commissioners. I do not suppose there will be any difficulty on their part in publishing their judgments and reasons in some accessible form. As far as I am concerned, I am anxious to get that information, and I do not expect any difficulty in getting it from the Commissioners. What I said was, I would publish any information I could.
  Mr. WARDLE: I want to ask the right hon. Gentleman one question. Will the information which he says he is willing to publish be published at an early date?
  Mr. BUXTON: It is difficult to publish at an early date information as to the working of this Act which has not yet come into force. I am afraid I cannot undertake that.
  Amendment, by leave, withdrawn.
  Motion made, and Question proposed, "That the Bill be now read the third time."
  Mr. BARNES: I am not going to detain the House more than two or three minutes but I hope a vote will be taken against this Bill, and for my part if that vote is taken I shall certainly vote against it. In the Debate which took place an hour ago I heard one or two hon. Members—
  Mr. DEPUTY-SPEAKER: I did not know the hon. Member was rising to move anything. Perhaps I should say I had notice from the hon. Member for Newcastle-under-Lyme (Mr. Wedgwood) that he intended to make a Motion on the Third Reading. Of course as I have called on the hon. Member for the Blackfriars Division he is entitled to proceed if he chooses.
  Mr. WEDGWOOD: I have no objection to the hon. Member sneaking now.
  Mr. BARNES: I beg to move as an Amendment to leave out the word "now" and at the end of the Question to add the words "upon this day three months."
  Mr. DEPUTY-SPEAKER: That is the point. The hon. Member for Newcastle-under-Lyme had given notice to the Chair of his desire to move that the Bill be read this day three months.
  Mr. BARNES: I shall move it if you will allow me, and I shall say only a few words. I heard some Members a short time ago express the opinion that if this Bill were found to be working well, and if the workmen got increased wages, for their part they would not mind at the end of five years continuing the Bill because of this rise in wages and these improved conditions of labour. I disagree absolutely with that sentiment. If working men cannot get increased rates of wages and increased comfort without that being passed on, and without arrangements being made in this House whereby the monopolists can pass it on to the consumer and the trader, then it seems to me that we are in a parlous position, and, therefore, I am against the Bill, root and branch. I quite understand the position in which the Government find themselves. A promise was made. The House was not consulted about that promise, and, therefore, for my part I feel absolutely absolved from any responsibility in regard to it. But still I recognise that the Government is in a peculiar position, having made a promise that a Bill of this character should be passed. But what was the promise?
  As has been said over and over again, it was that a Bill would be passed making up to the railway companies any increased charges consequent upon a rise of wages following on the strike. The strike is already two years old, and, therefore, it seems to me that we have already got beyond a reasonable time limit; but it becomes absurd when we consider that this Bill is to continue for another five years, nothwithstanding anything that may take place during that period, as a result of which the railway companies may increase their dividends, as they are already increasing them. I heard figures given by an hon. Member showing the returns of various railway companies. It so happens that I have some figures which bring the position of the companies right up almost to date. I have here a diagram showing the position of the various companies in regard to the price of stock and the returns on that stock from the beginning of 1908 to the end of the year 1912. I find, for instance, that the Great Northern Railway Company return shows that their stock

  1383
  was £4 13s. 3d. at the time of the strike in September, 1911, and at the end of December, 1912 that £4 13s. 3d. had increased to £5 8s. Take the three railway companies in Scotland. The stock of one increased from £5 2s. 9d. to £5 12s. 6d., another from £4 8s. 9d. to £4 18s. 6d., and so on. I find the Great Northern Railway Company has increased its dividend, and the price of its stock has also increased since 1908, and is increasing now. In fact, that applies to nearly all the railways. From the end of last year pretty nearly every railway company has stocks rising and returns to shareholders rising.
  From these figures there seems no reason why there should be any provision made for a long term of years to enable these companies—as I still believe this Bill will enable them—to put on the trader practically the whole cost of any increased wages given to their workmen. I have here a letter sent to the hon. Member for West Ham (Mr. W. Thorne) by the secretary of one of his branches on the Great Northern Railway—this railway that has experienced prosperity for all except its low-paid workmen. Last month an application was made for a rise of wages. Yard labourers are being paid in the North, two years after the strike, the magnificent wage of nineteen shillings a week. They vary from that to twenty-two shillings a week. Tube sweepers are paid nineteen shillings a week, and so on. Because this branch of the Gas Workers and General Labourers' Union ask for an increase on these miserable rates seven of them were discharged and young fellows at lower wages taken on in their place. There is nothing in these facts to justify the House in passing a Bill of this sort giving increased power to these railway companies, in spite of the fact that they are not carrying out their obligations—nothing to justify these railway companies getting five years of increased power to go on sweating their workers, or, if they give an increase of wages, turning it over on to the trader. As I am totally opposed to this form of syndicalism I intend to vote against this Bill, and I hope a large number of hon. Members, will vote with me.
  Mr. WEDGWOOD: I wish to second the Amendment for the rejection of this Bill, and I think the fact that it is unpopular in this House, and the prospect of its being exceedingly unpopular in the country is
  1384
  our main justification for rejecting the measure. What will happen? As soon as this Bill is passed you will have all over the country constituents—many of them small traders in country districts—complaining that this House in the year 1913 passed an Act of Parliament which enables the railway companies, already regarded in many districts as the chief enemy of industry in those districts, to further increase the local rates on produce—farm produce and manufacturers' produce. We shall have complaints coming in to us in shoals in consequence of the passing of this Bill. I wish, in seconding its rejection to-night, to point out that this Bill has been brought in by a Liberal Government, and I do hope that it will not be used as a political weapon by hon. Members opposite against the Liberal Government. After all, hon. Members opposite know that they, as well as we on this side, have to a large extent been responsible for this Bill being brought in.
  It was hon. Members on the other side, just as much as hon. Members on this side, who pressed to have the strike ended at all costs, even by this gigantic bribe to the railway companies. I think it, would be most deplorable, therefore, if, after we have passed this Bill into law, that a great agitation be got up against it in the country, and if it should be used as other measures, which were originally of a non-party character, have been used before now against the party in power, for, in this case, the weapon would be of an extremely deadly nature. I want to exempt myself and some other Members on these benches from any sort of charge of breaking any kind of pledge in voting against the Third Reading of this measure. I certainly, and I think a great many other hon. Members below the Gangway, deeply regret that that pledge was given by the Prime Minister in August, 1911. We feel that if the Government, instead of bribing the railway companies, had brought such pressure to bear upon them as was brought to bear upon the men; if there had been the suggestion of a receivership, as was made in the time of the coal strike; if the railway directors had been told that the railway service would be carried on with the men, but without the railway directors, then I think pressure of that sort would have produced exactly the same result, that is to say the cessation of the strike, and we should have had this country without this grievous burden to bear, due to

  1385
  the legislation now being passed into law in order to carry out the promise made by the Prime Minister. I think it ought to be quite clear that that promise was a conditional promise.
  The Prime Minister said he would do all he could to pass through the House such an Act, but he by no means pledged any individual Member of the House. And it is absolutely necessary that we should recognise that Members of this House cannot be bound by any pledges made by any other Member of this House. We are responsible to our constituents alone, and therefore we are not bound even by a promise made by a Prime Minister that every one of his followers would vote for any Bill; and that promise was, of course, not made. There is another reason why we should vote against the Bill, and that is that the railway companies have not played up to their part of the bargain. Since the great strike, if only one-tenth of the stories one sees in the Labour newspapers are true, it cannot be doubted that victimisation has been going on. People who have held advanced views and have taken part in agitation have been dismissed. I have in my mind the case of a man, whom I have been helping to some extent, who has been thrown out of employment, and for whom I see nothing but emigration. The cases we see in the newspapers, especially from the Midlands, show that there is a spirit among the directors of desiring to weed out all dangerous elements, as they consider them, from among their employés. I do not think that is playing the game. It is not carrying out the spirit of the promise they made when the strike was brought to an end, that in return for the Bill they would reinstate all the men who had gone out, and not penalise any of them by reason of the strike.
  I do not complain in the least of the fact that the railway companies are now able to pay bigger dividends in consequence of the good trade. But I do not think we ought to overlook the fact that they are getting a very good share of the improvement in trade. What I do object to is the fact that we are, by passing this Bill, definitely improving railway property all over the country. The very fact that this Bill is passed to-night, instead of being thrown out, will undoubtedly make a difference of about five points in the price of ordinary railway stock all over the country. You are giving to the railway com-
  1386
  panies power to increase their rates on a scale they have not been able to do up to now, and the very fact that you are giving them this power will improve the value of their property by five per cent. Five per cent. improvement in the value of the ordinary railway stocks in the country, which amount to something like five hundred millioms, would give a bonus to the railway companies of twenty-five millions. That means a million pounds in interest a year, equivalent to an improvement in rates of that amount. Thus, a probable increase in the earnings of the railways of a million pounds a year would result from the passing of this Bill. That is a very substantial bonus to give to any vested interest, and I do submit to hon. Members that we ought not to increase the power and wealth of these vested interests. We ought to remember that everybody who invested his capital in railways before the present day, took into account all the facts of the case. But now, whenever the railway servants get increased pay the investor knows it will be got back in increased rates. If, by altering the conditions of the control of the Government over railway companies, you increase the value of the stock, you do something to rob the rest of the community for the benefit of one particular interest.
  There is one other point to which I wish to refer, and that is that in passing this Bill we are practically doing away with the traders' complaint altogether. We know that under the Act of 1894 there have been very few actual complaints from traders, and very few cases in which rates have been brought down through complaints. But in future, the position of a trader making a complaint will be an absolutely impossible one. He will not be able to prove anything concerning an entire railway system. We may regard it as certain that there will be no complaints from traders before the Railway Commissioners. We are leaving, from now, entirely in the hands of the railway companies, what the freights shall be. I feel certain that that state of affairs cannot endure. The railway companies are combining together more and more for these great trusts, and it is undoubted that, as they combine together, so freight rates will increase more and more, and particularly these through freight rates which are at present competitive, but which will cease to be competitive when the great railway companies really get together.

  1387
  Therefore we shall be faced with a, position of affairs where the Government and the Railway Commissioners will have no control whatever over the freight rates charged by the railway companies—because the latter cannot act, except on the complaints of traders, and subject to the maximum increase, which is at present 50 per cent. in advance of the present rates. That position cannot possibly endure for long. I feel certain that as traders are brought face to face with conditions such as that, there will come an overwhelming outcry for the nationalisation of the railways. Though, personally, I am opposed to nationalisation, though I wish to see competition amongst the railway companies, I do think that after we have passed this Bill into law, the position of those of us who dislike a national service, and I do not want to see the State the only master in this country, will be weakened, and we shall be driven logically into the position of curbing the trusts in the only possible way by buying them out at a figure which will leave them a further handsome margin. I am opposed to the Bill, and I shall go into the Lobby against it, but I think that before very long those hon. Members who vote in favour of the Bill will be agitating against it.
  Mr. J. M. HENDERSON: Being connected with a railway company, I rise with very great diffidence to say a few words on this subject. I should like to bring a reasonable spirit to bear. Figures have been given by some of my hon. Friends which I know to be absolutely ridiculous. So far from the railways being prosperous, they are needy at present. A few of them, with mineral traffic, may be making money, but they have not all got mineral traffic—only a few. My hon. Friend spoke of the London and South-Western Railway. A few years ago their stock was over 200, to-day it is 135.
  Mr. WEDGWOOD: Yes, but Consols fell down also.
  Mr. J. M. HENDERSON: The London and South-Western, some time ago, stood at 200, now it is 122. [HON. MEMBERS: "Divide, divide."] I do not want to raise any discussion. I am just as anxious as other hon. Members are that everybody should be prosperous, including the working man. I recognise, and everybody recognises, that the first claim on all industry is the working man's wages. It
  1388
  always has been said in this House that the railway companies have no souls to be saved, but bodies to be kicked. Everybody has something to say against them, but nobody has anything to say in their favour. What is the result of it all? It becomes rather a serious matter, and it is a very short-sighted policy to adopt—this constant crabbing of the railway companies. After all, they have a duty to perform—a duty to the community—and if they are to be in the position of performing that duty they have got to have proper assistance and proper consideration. What is to happen if you deprive them of all means of performing that duty? At the present moment trade is extending throughout the country. You want more competition, you want bigger stations, and where is the money to come from? People will not invest their money in railway stock to-day. Therefore you will only be starving the railways, and they will not be able to meet the demand. Then what will happen? The Government may take them over, and I hope so—no one will welcome that more heartily than I should. But what will happen? They will take them over, like the telegraphs, and there will be £1,000,000 of loss every year. The Minimum Wage Bill, passed for the coal miners, was a totally different affair. The result was that though it added three halfpence or so to the cost per ton of coal, the price was raised to the consumer by 1s. 6d. Hon. Members speak of the railway companies as being inimical to the interests of outsiders or workmen, but they are not so to the extent that is made out. During late years there has been great competition of motor traffic, and the suburban traffic of the railways has been largely injured by that, and also by motor travelling. When a man becomes associated with a railway company he does not lose all his human instincts and desires, and we are not all the villains people think. I say, for those with whom I act, and so far as I am concerned, that this Bill shall not be used in any other way than to advance the trade of the country, and the best interests of everyone connected with them.
  2.0 A.M.
  Mr. SUTTON: I shall not keep the House for more than two or three minutes. It is not very often that I get up to speak, but on account of the large number of letters I have received from traders, the Manchester Chamber of Commerce and other bodies in Manchester, I feel it my duty on the Third Reading of this Bill to

  1389
  enter my protest against the Bill, and I hope the House will reject it in the Division lobby. I think this ought to be a lesson to the Government, at least in the future never to enter into any pledge with any railway or other company, even when a strike is on—
  An HON. MEMBER: Nor to intervene in a strike.
  Mr. SUTTON: I would not say not to intervene in a strike, but not to give a pledge which they are not certain to carry out. I think everyone will recognise that the Government has had a very hard job, and, indeed, the Attorney-General and the President of the Board of Trade have admitted it. The Attorney-General said they had a debt of honour which must be paid, but it is to be hoped that the debt of honour will not be paid and that it will be defeated to-night. Let me say that, so far as I am concerned, and I believe so far as my colleagues on the Labour Benches are concerned, we shall vote against the Bill because we believe it is the wrong way of raising the wages of the working man. Figures have been given to-night by different Members of the House with reference to wages paid to employés on the railways at the present time. Since the railway strike the companies have already raised their rates on the passenger traffic. People going to Blackpool have an extra threepence to pay, and those who come to London for one day have an extra shilling put on. I think, therefore, the railway companies during the last few months have been able to recoup themselves without there being any need to raise the freightage. This is inviting the railway companies to exploit the traders, and I am of the opinion of the hon. Member for Newcastle-under-Lyme (Mr. Wedgwood) that the only way in which we can prevent this taking place in the future is to nationalise the railways of the country, and I hope that will be done. I hope the House will defeat the Bill because it is a bad Bill. It is going to exploit the traders as it has already exploited the public, and I hope a large majority will be given against it.
  Mr. JOWETT: I want to offer my sympathy, if I may do so without offence, to the right hon. Gentleman the President of the Board of Trade for the very great and awkward task he has had given to him as a legacy from his right hon. colleague the Chancellor of the Exchequer, who is really the villain of the piece. The Chancellor
  1390
  of the Exchequer has done more for vested interests than any other Minister who has been in office since I closely followed politics. I am sorry the right hon. Gentleman is not here. It would surely have been an education to him to see how unpopular his bargain is, and I should have liked him to hear what I have to say. He has been responsible for encouraging agreements between different railway companies which has enhanced their income, increased the capital value of their shares, and, over and above that, has made a bargain which the Government regards as a pledge of honour in order to settle a strike in that huckstering way which seems to be characteristic of him. He is a born hucksterer. He cannot help it, and if he ever gets to the gates of Heaven he will bargain with Peter. If he goes elsewhere he will have a deal with his Satanic Majesty. It is in his nature to have a deal. The result of the present deal is this—that we are going to determine that wages of railway workers, if they are raised, shall be raised at the cost of the public. Literally, what does it mean? It is beating the dog with his own tail. The working men do not want their wages raised in that way. It is no use increasing the wages of the working man unless the increase is to come from those who can afford to pay.
  Of the £126,000,000 total income of the railways of this country, £78,000,000 goes in working expenses and £48,000,000 to the shareholders. It may be all very well for my hon. Friend (Mr. J. M. Henderson) to say that it reckons out at a small percentage per pound on the share capital, but that is not saying what is actually the fact, namely, that there is £198,000,000 of watered capital which consists of mere entries in books. He does not state in addition to that that the railway companies have never carried out a policy of allowing sufficient for depreciation, and their capital is a fictitious capital. Any ordinary business concern which had failed to reckon depreciation when it had landed in the position in which the railway companies have landed themselves, would have had to write their capital down repeatedly. They would have had to say that their pound shares must be written down to five shillings, and if the railway companies did that their share capital would have appeared less. Before the strike a hundred thousand men were working for a pound a week or less for the railway companies. That was a disgrace

  1391
  to civilisation, for the removal of which the public ought not to be called to pay, and I shall gladly vote against the Bill.

SUPERANNUATION (No. 2) BILL.
Order for Committee read, and discharged. Bill withdrawn.
Question put, "That the word 'now' stand part of the Question."
The House divided: Ayes, 135; Noes, 31.

Division No. 604.]

AYES.

[2.9 a.m.

Abraham, William (Dublin, Harbour)

Havelock-Allan, Sir Henry

O'Connor, John (Kildare, N.)

Acland, Francis Dyke

Hayden, John Patrick

O'Connor, T. P. (Liverpool)

Addison, Dr. Christopher

Hayward, Evan

O'Doherty Philip

Ainsworth, John Stirling

Hazleton, Richard

O'Kelly, E. P. (Wicklow, West)

Allen, A. A. (Dumbarton)

Helme, Sir Norval Watson

O'Malley, William

Allen, Rt. Hon. Charles P. (Stroud)

Henderson, J. M. (Aberdeen)

O'Neill, Dr. Charles (Armagh, S.)

Baker, Harold T. (Accrington)

Herbert, General Sir Ivor (Mon., S.)

O'Sullivan, Timothy

Balfour, Sir Robert (Lanark)

Higham, John Sharp

Parry, Thomas Henry

Beauchamp, Sir Edward

Horne, C. Silvester (Ipswich)

Pease, Rt. Hon. J. A. (Rotherham)

Beck, Arthur Cecil

Howard, Hon. Geoffrey W. A.

Phillips, John (Longford, S.)

Benn, W. (Tower Hamlets, St. Geo.)

Hughes, Spencer Leigh

Pringle, William M. R.

Bentinck, Lord H. Cavendish-

Isaacs, Rt. Hon. Sir Rufus

Pryce-Jones, Colonel E.

Boland, John Plus

Jones, Edgar R. (Merthyr Tydvil)

Radford, G. H.

Booth, Frederick Handel

Jones, J. Towyn (Carmarthen, E.)

Reddy, Michael

Brady, Patrick Joseph

Jones, William (Carnarvonshire)

Redmond, John E. (Waterford)

Brunner, John F. L.

Joyce, Michael

Redmond, William (Clare, E.)

Burns, Rt. Hon. John

Keating, Matthew

Redmond, William Archer (Tyrone, E.)

Buxton, Rt. Hon. S. C. (Poplar)

Kennedy, Vincent Paul

Roberts, Charles H. (Lincoln)

Carlile, Sir Edward Hildred

Kilbride, Denis

Robertson J. M. (Tyneside)

Cawley, H. T. (Lancs., Heywood)

King, Joseph

Robinson, Sidney

Chapple, Dr. William Allen

Lambert, Richard (Wilts, Cricklade)

Roch, Walter F. (Pembroke)

Clancy, John Joseph

Lardner, James C. R.

Rose, Sir Charles Day

Clough, William

Law, Hugh A. (Donegal, West)

Rowlands, James

Crumley, Patrick

Lewis, John Herbert

Rowntree, Arnold

Cullinan, John

Low, Sir Frederick (Norwich)

Samuel, Rt. Hon. H. L. (Cleveland)

Dawes, James Arthur

Lundon, Thomas

Scanlan, Thomas

Doris, William

Lynch, A. A.

Scott, A MacCallum (Glasgow)

Duffy, William J.

Macnamara, Rt. Hon. Dr. T. J.

Sheehy, David

Esmonde, Dr. J. (Tipperary, N.)

MacNeill, J. G. Swift (Donegal, South)

Simon, Rt. Hon. Sir John Allsebrook

Farrell, James Patrick

Macpherson, James Ian

Smyth, Thomas F. (Leitrim S.)

Ffrench, Peter

MacVeagh, Jeremiah

Strauss, Edward A. (Southwark, West)

Field, William

M'Ghee, Richard

Taylor, Theodore C. (Radcliffe)

Fitzgibbon, John

McKenna, Rt. Hon. Reginald

Taylor, Thomas (Bolton)

Flavin, Michael Joseph

Markham, Sir Arthur Basil

Tennant Harold John

Gibbs, George Abraham

Marshall, Arthur Harold

Toulmin, Sir George

Gladstone, W. G. C.

Meagher, Michael

Trevelyan, Charles Philips

Greig, Colonel J. W.

Molloy, Michael

Ure, Rt. Hon. Alexander

Griffith, Ellis J.

Molteno, Percy Alport

Verney, Sir Harry

Guest, Hon. Frederick E. (Dorset, E.)

Morgan, George Hay

Ward, W. Dudley (Southampton)

Gwynn, Stephen Lucius (Galway)

Morison, Hector

Webb, Henry

Hackett, John

Muldoon, John

White, J. Dundas (Glasgow, Tradeston)

Harcourt, Rt. Hon. L. (Rossendale)

Munro, Robert

White, Patrick (Meath, North)

Harcourt, Robert V. (Montrose)

Murray, Captain Hon. A. C.

Whyte, A. F. (Perth)

Harmsworth, C. B. (Beds, Luton)

Neilson, Francis

Harvey, A. G. C. (Rochdale)

Nolan, Joseph

TELLERS FOR THE AYES.—Mr. Illingworth and Mr. Gulland.

Harvey, T. E. (Leeds, West)

O'Brien, Patrick (Kilkenny)

NOES.

Adamson, William

Gretton, John

Sanders, Robert A.

Bathurst, Charles (Wilts, Wilton)

Hogge, James M. (Edinburgh, E.)

Smith, Albert (Lancs., Clitheroe)

Bentham, G. J.

Jowett, Frederick William

Sutton, John E.

Bowerman, Charles W.

O'Grady, James

Thorne, William (West Ham)

Brace, William

Parker, James (Halifax)

Walsh, S. (Lancs., Ince)

Bridgeman, W. Clive

Peto, Basil Edward

White, Sir Luke (Yorks, E.R.)

Bryce, John Annan

Pointer Joseph

Whitehouse, John Howard

Chaloner, Colonel R. G. W.

Price, C. E. (Edinburgh, Central)

Wilson, W. T. (Westhoughton)

Clynes, John R.

Richardson, Thomas (Whitehaven)

Dalrymple, Viscount

Roberts, G. H. (Norwich)

TELLERS FOR THE NOES.—Mr. Barnes and Mr. Wedgwood.

Duncan, C. (Barrow-in-Furness)

Rutherford, Watson (L'pool, W. Derby)

Glanville, Harold James

Bill read the third time and passed.

HERRING FISHERY (BRANDING) BILL.
Order for Second Reading read, and discharged. Bill withdrawn.
PENSIONS (GOVERNORS OF DOMINIONS) BILL.
Read the third time, and passed.
BETTING INDUCEMENTS BILL [Lords].
Order for Second Reading read, and discharged. Bill withdrawn.
SAMUEL ROBINSON'S TRUST CHARITY BILL.
Read a second time, and committed to a Committee of the Whole House for to-morrow (Friday).—[Mr. Charles Allen.]
BEVERLEY CHARITIES BILL.
Read a second time, and committed to a Committee of the Whole House for to-morrow.—[Mr. Charles Allen.]
WHITBY CHARITIES BILL.
Read a second time, and committed to a Committee of the Whole House for to-morrow.—[Mr. Charles Allen.]
HABERDASHERS' COMPANY LOAN FUND BEARING INTEREST CHARITY BILL.
Read a second time, and committed to a Committee of the Whole House for to-morrow.—[Mr. Charles Allen.]

EMPLOYMENT OF CHILDREN BILL.
Order for consideration of Bill (as amended in the Standing Committee) read.
Mr. BOOTH: I object.
The SECRETARY of STATE for the HOME DEPARTMENT (Mr. McKenna): With the leave of the House, I do not propose to go on with this Bill if there is opposition to it, but I would remind my hon. Friends that the Bill has been very folly considered by all Departments directly interested. They have come to a general agreement, and I can assure my hon. Friend (Mr. Booth), that those who have made a study of the Bill are satisfied that it would be of inestimable advantage to the children. Of course, if my hon. Friend, in spite of that information, insists in opposing the Bill, I have no alternative but not to proceed with it.
Lord H. CAVENDISH-BENTINCK: May I appeal to the hon. Gentleman opposite to withdraw his opposition?
1394
This Bill is demanded by the conscience of the country, and is practically an agreed measure. The hon. Gentleman is doing himself and his own party an injustice by opposing it.
Mr. T. E. HARVEY: I would add my voice to that appeal.
Mr. BOOTH: I submit that these appeals, are not at all fair. To bring forward a controversial Bill of this kind at this stage of the Session, and to try to get it through is almost inhuman. This has been a private Member's Bill, and it is opposed in all parts of the House for very different reasons. I opposed the Second Reading, and have pointed out a large number of objections. I have found that none was met in Committee. To say that interests have been met is simply to burke the question. The stand I took was on behalf of the liberty of the people and of the poor, and to say that business interests have been met is to say that the whole thing is viewed from a wrong standpoint. The hon. Baronet the Member for the City of London indicated earlier to-day that he was decidedly opposed to this Bill. I have not changed my views. I could name two or three score of Members of the House who want considerable alterations made in the Bill. I ask whether it is at all fair that we should enter on a controversial Bill of this kind now, and consider Amendments to which I attach the utmost importance? I ask whether it is fair, at this time, when we have done the great work of the Session, that we should be asked to stay behind and enter on a new controversy?
Mr. SPEAKER: Does the hon. Member move the Amendment which stands in his name?
Mr. BOOTH: Yes, I shall, if there is any determination to go on with the Bill.
Mr. McKENNA: In view of what has been said, I do not propose to proceed with the Motion.
Consideration, as amended (in the Standing Committee) deferred till to-morrow.

INDIAN AND SUPPLEMENTAL MAILS.
Resolved, "That the Contract, dated the 14th day of January, 1913, between the Postmaster-General and the South Eastern and Chatham Railway Companies Managing Committee for the conveyance of the

1395
Indian Mails in both directions between Dover and Calais, and other Mails from Dover and Folkestone to Calais and Boulogne, respectively, be approved.—[Mr. Gulland.]
The Orders for the remaining Government business were read and postponed.
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Whereupon Mr. Speaker, pursuant to the Order of the House of 14th October, proposed the Question, "That this House do now adjourn."
Question put, and agreed to.
Adjourned accordingly at Twenty-three minutes after Two a.m., Friday, 14th February, 1913

  Hong Kong (Army and Navy Services).
  Hong Kong (Army and Navy Services).
  Customs and Excise Department.
  Customs and Excise Department.
  Elementary School Teachers (Superannuation).
  Elementary School Teachers (Superannuation).
  British Beekeepers' Association.
  British Beekeepers' Association.
  Old Age Pensions.
  Old Age Pensions.
  Money Raised (Hong Kong).
  Money Raised (Hong Kong).
NATIONAL INSURANCE ACT.
  SANATORIUM BENEFIT.
  SANATORIUM BENEFIT.
  DOMESTIC SERVANTS.
  DOMESTIC SERVANTS.
  PROVISIONAL REGULATIONS.
  PROVISIONAL REGULATIONS.
  Land Values (Net Receipts).
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  National Education (Ireland).
  National Education (Ireland).
  Land Purchase (Ireland).
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  Untenanted Land (County Meath).
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  Castleisland Parish Committee.
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ROYAL NAVY.
  SUPERINTENDING ELECTRICAL ENGINEER.
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  ARREST OF SEAMEN BY CIVIL AUTHORITIES.
  ARREST OF SEAMEN BY CIVIL AUTHORITIES.
  Reserve of Officers (Captain A. D. Snow).
  Reserve of Officers (Captain A. D. Snow).
  Dorchester Barracks (Compensation Clause).
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  Rifle Ranges.
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  Metropolitan Police (Relatives of Deceased Constables).
  Metropolitan Police (Relatives of Deceased Constables).
  India Office Contracts (Fair-Wages Clause).
  India Office Contracts (Fair-Wages Clause).
  Director of Public Instruction, Bengal.
  Director of Public Instruction, Bengal.
  African Affairs.
  African Affairs.
  House Flies.
  House Flies.
  Wheat and Flour (Imports, 1911).
  Wheat and Flour (Imports, 1911).
  Agricultural Labourers (Wages).
  Agricultural Labourers (Wages).
  Metropolitan District Railway.
  Metropolitan District Railway.
  Load-Line Tables (Loss of Steamship "Zelia").
  Load-Line Tables (Loss of Steamship "Zelia").
  Telegraphic Communication (Athy, Dublin and Carlow).
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  Kew Gardens (Increase of Staff Pay).
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NATIONAL INSURANCE ACT, 1911.
Provisional Regulations, dated 12th February 1913, made by the Insurance Commissioners entitled the National Health insurance (Claims for Exemption) Regulations (England), 1913; Laid before the House (pursuant to Act) and to be printed. (No. 213.)
ESTABLISHED CHURCH (WALES) BILL.
Petitions against; of persons signing (18): Read, and ordered to lie on the Table.
CONSOLIDATION BILLS.
Second Report from the Joint Committee made, and to be printed. (No. 214.)

ESTABLISHED CHURCH (WALES) BILL.
Debate on the Amendment to the Motion for the Second Reading, viz., that the Bill be read 2a this day three months resumed (according to Order).
THE LORD BISHOP OF ST. ALBANS: My Lords, I think of all the arguments which have been brought before your Lordships' House in defence of this Bill, perhaps the most striking was one which was adduced by my right rev. friend the Bishop of Hereford, when he stated that this had been argued mainly as a question of Disendowment, and that, as the question of Disendowment was practically settled by the question of Disestablishment, as a matter of fact there is no good arguing it further. I think my right rev. friend must have been a little astonished at the speeches which followed his own, and I do not think he could have complained, after hearing those speeches, that there was any desire to shirk the question of the Establishment of the Church. I shall for my own part, in the few observations I make to-night, touch very little on the question of endowment. I simply say, on the question of endowment, that there are three points in this Bill with reference to tithes, with reference to commutation, and with reference to curates, that seem to me to make the title "a mean little Bill" absolutely deserved. As to the point which
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has been made that it is sufficient for the Church to be able to raise funds enough for its maintenance from year to year without the help of endowments, I should only like to say that a significant comment upon that is found in the fact that the Calvinistic Methodists are doing all they can now to accumulate endowments and a Member of Parliament has in this very year given £50,000 to the Calvinistic Methodist Endowment Fund. I venture to say that if there had not been a real need of endowment there would scarcely have been this desire to accumulate this fund, and there could hardly have been this generous donation of which, I assure your Lordships, I speak only in terms of praise.
But let me pass on from this question of Disendowment to the question of Disestablislunent. The particular point I want to argue is the moral right of Parliament to dismember the Church of England. When I come to the history of the Church in Wales I cannot help noticing what was brought out so forcibly by the most rev. Primate last night, that long before there was a Parliament in existence there was in existence a vigorous Church in Wales; long before Parliament existed there were representatives in Convocation of the Church in Wales. But there is one point that I should like, if I may, to add to that. It is that during the last seven centuries there can be no question whatever that the Church in Wales has been an integral part of the English Church, and certainly in the earlier part of that time the Church—that is, the entire Church of which the Church in Wales formed a part—was taking a very remarkable part in the assertion of British liberty and the development of what I may call the self-consciousness of the nation to which we belong.
Perhaps I may be allowed to give two or three instances. In 1213, on August 4, a Council was held at St. Albans, the See City which I represent, called by Justiciar, the chief Minister of the Norman Kings, and the Archbishop of Canterbury, and attended by Bishops and Barons, and, what is the remarkable thing, by representatives of townships on Royal demesnes, each sending a reeve and four legal men. The ostensible cause for which this Council was convened was to discuss the question of assessment for the plunder that had been alleged to have been wrought upon the Church, but, as a matter of fact, the Council when

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convened discussed the general question of the government of the country. Bishop Stubbs, who will be admitted to be our first authority on constitutional history, says the Council was one of the most important things in the development of British liberty, and one of those gatherings which ultimately led to the creation of the House of Commons.
That year was a remarkable one, for a little later in it, on the 25th of August, a similar Council was held at St. Paul's, when Henry the First's Charter was produced; and on November 7 of that same year a Council was convened by the King at Oxford when four discreet men of the shire were to take the place of the four legal men of the Royal desmesnes. History does not tell us whether that Council at Oxford was ever held, but the fact that it was convened in this memorable year 1213, and convened largely, let me say, by the aid of the Bishops, who took part with the Barons and others in summoning these gatherings, shows that the Church at that time was vindicating the liberties of the British nation; and the Church at that time, without any question whatever, included the Church in Wales. I should like to add this further point. In all that turbulent twelfth century, which was characterised by considerable wars in Wales, the one fact which was helpful and which led to an ultimate conciliation, was the fact that the Church in Wales was then one with the Church in England, and just as in earlier centuries we find that the unity of the Church led the heptarchy to become one kingdom, so the unity of the Church in Wales and in England led undoubtedly to the civil consolidation and the ultimate unity of England and Wales. In that great historical duty, I venture to say, the Church in Wales must be allowed to have taken its share, and I thought it worth while in reference to this question of dismemberment to draw attention to the share which it undoubtedly had.
When I come to Parliament days, I venture to say that the advocates for this Bill will find little in Acts of Parliament which they can really consider to be precedents. They will find a series of Acts regulating the Establishment, regulating the endowments of the Church of England; and they have gone on from that day down to the present. As the most rev. Primate told us yesterday, many of these Acts of Parliament have been Acts passed at the
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request of the Church herself and after very careful consideration by all the authorities of the Church. But there are three things, I venture to say, that if you look through the Statute Book you will find it very difficult to discover. You will not find Acts of Parliament establishing the Church; you will not find Acts of Parliament endowing the Church; and you will not find before this Bill Acts of Parliament dismembering the Church. There is, I know, one precedent which is quoted. I should have thought almost that the speech of the noble Lord opposite, Lord Balfour of Burleigh, had disposed of the argument of the Irish Church, but I should like to add one or two points in reference to it. When the noble Earl, Lord Beauchamp, said that he thought the noble Marquess who leads the Opposition would find it perhaps a little difficult to explain how it was that, having voted for the Irish Church Disestablishment Bill, he now proposed to vote against this Bill to disestablish the Church in Wales, I could not help thinking that if the noble Earl had only heard two speeches which I had the opportunity of hearing from a Member of the Cabinet that disestablished the Irish Church he would have needed no further answer.
I remember perfectly well as a young clergyman being present in yonder gallery of your Lordships' House during the last day of the discussion on the Irish Church Bill. I remember very clearly that amongst the speeches I heard upon that evening was a speech from the late Duke of Argyll in favour of the Disestablishment of the Irish Church. Many years later I attended a very large meeting in the Albert Hall over which the late Archbishop Benson presided, and I heard the same noble Duke speak strongly and clearly against the Disestablishment of the Church in Wales, and vindicate his action by arguments which seemed to me perfectly irrefutable as showing the absolute distinction between the one case and the other. In the year 1800 Parliament thought fit to unite the Church in Ireland and the Church in England. There was no idea then of making the Church in Ireland an integral part of the Church of England. It could not be done. It was united as a sister Church. What Parliament could do, Parliament could undo, and in the year 1869 Parliament chose to undo that act by severing the union created in 1800, which was, as I have said, entirely a

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Parliamentary union. But when Parliament thought fit to sever this link and to make the Irish Church again quite independent, it took care, as Lord Balfour of Burleigh pointed out yesterday, to treat the Church of Ireland as a whole, and not to take any part of it; for only with the Church as a whole, I venture to contend, has the State as a whole any right whatever to meddle.
I want to lay it down, if I may, at least as a principle in my own mind, that the union between Church and State is a union which either side may desire to review. It might be that from the side of the Church conscientious members of that Church would feel that it is right now to sever the link that unites them to the State. It may be that the State may consider that for sufficient reasons it is right to sever the link on the part of the State. What I want to lay down, at all events as an axiom for my own guidance, is this. The State has only the right to deal with the Church as a whole, and not to sever a part of that Church. When the State presumes to sever a part of the living community and make it, as it were, a separate community, that is an outrage and an invasion of the spiritual rights of a spiritual body. When I come, therefore, to the question which concerns us to-day, I find that here there is a Bill which is doing everything that His Majesty's Government can do to sever the Church in Wales from the Church in England. I maintain that it is not only from the Welsh side but from the English side as well that this matter ought to be regarded. You may say, if you will, that if a surgeon touches my finger, it is only my finger that he touches; but I venture to say that if he cuts my finger he cuts me. It is I, my personality, that feels it. It is just the same if you sever a part from the Church.
I should be prepared to argue that we of the Church of England are suffering a real loss when we part with any portion of the body, and especially when it is a part which has been for more than seven centuries an integral part of the body and has taken a prominent place in obtaining British liberties and in guiding the British people in ways of righteousness and peace. I know you can find fault—who cannot?—with the Church in various periods of its existence. I know you may find fault with the Church in the last century and
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the century before. I am not likely to forget certain things connected with the Church in the earlier part of the last century. I happen to be the son of a man who was born in what is now a part of the city of Cardiff on property which belonged to his father and in which, therefore, I have a natural interest. My father was ordained in Llandaff Cathedral, and I recollect him telling me that at an early visitation held by Bishop Sumner a certain curate of the diocese expressed alarm lest he should starve because the Bishop told him that he could not possibly tolerate his remaining in charge of five parishes at once, and all on the large income of £40 per annum! But we have passed those days now, and if you asked me to what those bad days were due I should say they were due to many causes. The entire Church at that time was passing under a cloud. Any one who knows anything about Abbey and Overton's "Church History in the 18th Century" does not require to be told what those causes were. But one of the causes was certainly this, that during a long period under successive Ministers—and I am afraid I must say mainly Whig Ministers—appointments were freely made of Englishmen to Welsh Bishoprics, as if they were the appanage of Party and the spoils of victory. If you find that religion suffered because of these appointments, I venture to say that it is not the Church alone which must bear the blame, but that the Church must share the blame with those who made such appointments.
We have passed those days, I am glad to say, and we have now to consider what is the line we have undertaken. I am going to speak very plain and clear words, which may, perhaps, astonish some of your Lordships, and what I say I shall not be saving for the first time. I said it publicly more than twenty years ago at Portsmouth on an occasion when two of my right rev. brethren who are here now—the Bishop of St. Asaph and the Bishop of St. Davids—also spoke. I consider it such an outrage on a spiritual body to attempt to sever a part of it from the whole that I would far rather be a member of a Disestablished Church, would far rather be disestablished myself and go out together with the Church in Wales, than I would remain in an Established Church with the Church in Wales cut off from the body. I venture to say at least that if I make that statement it is not a matter

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of loaves and fishes, or a matter of endowments. It will not be considered that I am lightly making a statement which might involve the whole Disestablishment of the Church of which I am a minister; but I do say that it is possible to go beyond limits which a man can tolerate. I say that when the State, as a civil body, assumes to sever from a spiritual body an integral part of that body, the State is doing what there is no precedent in Parliament to permit it to do; it is, moreover, doing what I believe to be a moral injury, and an absolute injustice. It is for these reasons, apart from all other arguments, which have been adequately dealt with in this debate, that I venture to lift up my voice to-night against the Second Reading of this Bill.
LORD ABERCONWAY: My Lords, if I venture to take part in this debate it is because I approach the subject from the point of view of a Welshman by adoption, and at the same time from the point of view of one who has always regarded this question, if I may say so, from an impartial standpoint. But at the same time it is one of those questions which one almost shrinks from attacking. I feel that a Bill of this kind is calculated to wound the tenderest susceptibilities of tens of thousands of earnest, good men who have devoted their lives to the work of Christianity, and no one can have listened to the eloquent speeches which have been made by right rev. Prelates and others in this House without feeling that this is not a measure which can be treated wholly from a Party political point of view. Speaking as a member of the Party responsible for this Bill, I feel very keenly the suggestion that we are actuated by motives of plunder in regard to the disendowment clauses of the Bill. I also feel keenly the suggestion that we are actuated by hostility to the spiritual side of a great Church.
With regard to the remarks of the right rev. Prelate who has just sat down, I think I may say that with the greater part of his observations we on this side of the House most thoroughly agree. We have no quarrel with the English Church represented in Wales. We respect its history and we venerate the great names it has produced. We know that to the Church in Wales in the Middle Ages and the Tudor period a great part of the civilisation of Wales is due. It is only because we have
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asked ourselves, forced by what we believe to be the state of opinion in modern Wales, whether the time has not come when some changes in the constitution of the Church is not forced upon us that we have brought forward the subject for consideration in the Bill before your Lordships' House. The right rev. Prelate spoke of the act of a surgeon in amputating a finger, and said that the amputation of a limb would injure the whole body. I think he might have pushed the argument rather further. There are, I would remind him, cases where the surgeon has to consider the state of the whole body and where he finds that unless he performs a certain amputation the patient will not only lose a limb, but may lose his life.
What you have to consider is this. Is the situation in Wales such as to justify us in severing the Welsh branch of the English Church from the parent body? I quite appreciate the difficulties of the case. I quite appreciate the cogent and forcible arguments of noble Lords opposite, and particularly of the noble Viscount, Lord St. Aldwyn, who brought to bear all his well-known powerful critical abilities in order to search out the defects of this measure. I admit that it is not easy to frame a perfect measure when it has to be constructive in parts as well as destructive. I recognise the intense feeling which was expressed in such wonderfully fascinating and eloquent language by the Bishop of St. Asaph two nights ago. He handled the question with his accustomed fairness, and with that fire which only a Welshman possesses; and I may say that his speech supplies your Lordships with abundant evidence of the reason for the enormous popularity enjoyed by the right rev. Prelate in North Wales. I venture to say that, great as is admitted to be the popularity which the right rev. Prelate enjoys at present in Wales, if he were a Prelate of a Disestablished Church he would have no rival at all in North Wales, except Mr. Lloyd George.
As to the question of Disendowment, I own that I approach the subject with rather mingled feelings. I should have been very glad if the whole of the revenues of the Church had been left to the Church. True we only propose to deprive the Church of £50,000 a year. I know it has been said that the sum approaches nearer £100,000, but the figures are not particularly clear; and in any event there is

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no question of principle involved in the difference between £50,000 and £100,000. It is a mere question of expediency whether you leave the Church in possession of £250,000 or £300,000. But on this question of Disendowment there was the greatest difference of opinion in the House of Commons. A large number of members of the Liberal Party were opposed altogether to Disendowment, and I venture to say that if, instead of rejecting the Bill on Second Reading, as we believe you intend to do, your Lordships were to amend it in Committee and then send it back to the other House you would probably be able to effect such a compromise as would leave the Church in possession of her revenues. That, I fear, is not going to be done; on he other hand, as far as I can gather, the opponents of this Bill are going to stake all on the double chance of a Dissolution this year and of a Conservative Government coming into office after the General Election. It is quite obvious that if this chance does not happen and if the Bill is rejected to-night it will come back to your Lordships' House next session without a line or a syllable having been altered, and the whole of its previsions, whether we believe them to be generous and just or not, will in due time be incorporated in an Act of Parliament.
But take the question of Disendowment. We have had, I submit, abundant evidence that Disendowment does not injure a Church. The Irish Church is stronger to-day than it was even when in full possession of its endowments. Take the case also of the Roman Catholic Church in this country. It has built itself up practically from nothing. It is a poor Church, fortified by a few rich men, and yet it has covered the country with beautiful buildings; it has supported its clergy; it has maintained schools; and it has acquired an influence which comparatively a few years ago would have been thought incredible. In France a few years ago there took place a drastic separation of Church and State—a cruel measure of Disendowment. Not only were the funds taken from the Church, but the fabrics were taken also, and were turned into historic monuments. Yet the Church in France has never been so vigorous since the Revolution as it is to-day. Noble Lords who know Paris must be well aware that splendid churches are being built and new parishes are being created. Catholicism
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was never more powerful in France than it is to-day as a Disestablished and Disendowed Church. Take the Colonies, and take also the United States. In the United States they have magnificent churches, they have a highly-paid clergy, and they have all the paraphernalia of an Episcopal Church bar the Establishment itself. Under this Bill, if private individuals choose to endow a Church, we recognise the right of private endowments to remain in the hands of the Church and to be used for the cause for which they were intended.
I look upon the Church of England as the richest Church in the world. Why, therefore, should it alone be afraid of being Disestablished and Disendowed? The Welsh alone contribute £300,000 a year in voluntary donations to this Church; and will any noble Lord say that the Church is not generous enough to make up a small deficiency of from £50,000 to £100,000 a year? Look at the great revenues derived in South Wales from mineral royalties by gentlemen who are notoriously liberal in their benefactions to local charities and other useful objects. Those gentlemen, I feel sure, would be only too happy to devote a considerable sum, if necessary, to make good any deficiency which might arise in the funds of the Church in Wales. Personally I venture to say that the Church would not be worse off because of the Disendowment clauses of this Bill. My real hesitation is in regard to where the money which is taken from the Church is to go. Anything more disastrous than to apply religious endowments to the relief of rates I cannot imagine. On looking through the clauses of the Bill, however, I am glad to see that precautions have been taken to prevent this being done, and I hope the Home Secretary of the day will stand firmly against any attempt of the county councils to apply these revenues to the relief of rates. So far as the University is concerned, there is less objection; but if I were to be asked what I personally would do with these funds, I would say apply them to such objects as the endowment of research in medicine, which at present lacks any endowment. That might confer incalculable benefits on humanity at large, and such an endowment would not exhaust the possibilities of the position, as there are other objects of a similar kind worthy of attention.

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Offers were made in the House of Commons to allocate portions of these funds to dissenting bodies, and though they were rejected by the Liberal Party because Nonconformists would not accept money from the State, at the same time I could conceive no serious objection to applying portions of these funds to paying off the debts on existing places of worship belonging to denominations other than the Church of England. But my noble friend Lord Pontypridd puts his foot down on that proposal. However, I earnestly hope that when this Bill comes to be administered as an Act of Parliament this money will be preserved for purposes which cannot be said to be in relief of taxes or rates. It was said by a noble Lord opposite, Lord Dynevor, last night, that this Bill in effect creates, for the first time, a Parliamentary Church in Wales. I do not think that criticism, if indeed it touched a real principle of this Bill, is altogether sound. I may compare with it, for example, a Bill which passed your Lordships' House two or three years ago to deal with the United Free Church in Scotland. It was passed to remove certain difficulties, and this House is constantly dealing with Bills which affect private and public trusts. You cannot say that Bills which are necessary from a legal point of view to relieve difficulties in any way create a Parliamentary situation, and all that this Bill does is to enable the Church to administer its own funds in a legal way and to stereotype, if I may say so, the constitution which it already enjoys.
But nobody can deny the competence of Parliament to legislate for the Church of England. If we look at the history of the Church of England during the centuries succeeding the Reformation we see that from one generation to another it was the prey of every religious denomination. At one time Protestant; at another Catholic; at another a sort of Erastian Church; it was Presbyterian, Congregationalist, then again Anglican, and finally its troubled history was set at rest by the Act of Uniformity which practically stereotyped the position of the Church. I ask your Lordships to remember that this Bill does not attempt to deal with the spiritual independence of the Church in Wales. Church prayer will be left in its integrity; the Thirty-Nine Articles are untouched; and questions on which Churchmen are at variance are left for their own solution.
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All that the Bill does is to separate the Church from the absolute tutelage of the State. Noble Lords opposite, and particluarly right rev. Prelates, have taken the view that there is not a majority of the Welsh people in favour of this Bill. They say there is no mandate, and that Parliament has no right to pass a Bill of this kind in the absence of such mandate. I appeal to noble Lords who have followed the course of recent political history and ask them if that view is really justifiable.
The right rev. Prelate the Bishop of St. Asaph made an allusion to the payment of tithe, and stated, I think, that out of the total tithe paid in Wales the great proportion was paid by members of the Church of England. Noble Lords will remember that the tithe which used to be paid by the tenant farmer is now paid by the landlord under Lord Salisbury's Act which was passed twenty years ago. The mere fact that any particular member of the Church hands to the ecclesiastical authority the tithe he is compelled to collect from his tenants does not make the tithe payable only by persons of the religion of those who happen to hand it over. The tithe is collected from the farmer, and I venture to say that nine out of ten of the small farmers in Wales are strong opponents of the Established Church. They are its opponents largely because of the grievance they have always felt with regard to tithes, and you cannot now at this late period of history eradicate from their minds the idea that they have been paying for generations to a Church to which they do not belong.
I know the heart of Welsh Wales, and wherever I go I see in every corner in the wildest districts a little chapel—a Calvinistic Methodist or a Baptist chapel. I know that they have been built with the hard-earned money of the poor people of Wales. They have been built by the small farmers, the small tradesmen, and the working-men. These are the chapels in which the mass of the Welsh country people worship God. The habitations of these people are far removed in many cases from the parish churches; but they have put these chapels where they are easily accessible among their valleys and mountains. They are their property, the centres of the social life of Wales, the places where they hold their tea-meetings and their eisteddfods, and where everything

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that goes on socially is conducted with decorum, with propriety, and I venture to think, with advantage to Welsh civilisation. They are constantly building new chapels and schools. Every man who lives in Wales knows that for one application he gets to subscribe to the Church or to Church schools, he gets a dozen applications for a subscription to Calvinistic Methodist or Baptist churches. The efforts these people make are extraordinary considering the smallness of their resources. If you go to the church in any parish what do you find? You find perhaps a Welsh service on one Sunday morning and an English service on the next. The people who go to the church are practically the squire—the man who lives in the big house—his upper servants, a few educated people who do not sympathise with the kind of thing they get in the Calvinistic Methodist church but prefer the ordinary Anglican service, and a few English visitors. But in no sense do these churches represent the country people of Wales. The situation reminds one of the old lines—
The wee church, the Free Church, the church without a steeple,
The old church, the cold church, the church without the people.
That is the condition of the Established Church and the Dissenting Church in the Welsh country districts. I know it may be different in towns, but I believe I am right in saying that even in large towns the great majority of the inhabitants are Dissenters.
A noble Lord said yesterday that the Welsh care for nothing but preaching, and there is a great deal of truth in that. You have to recognise that, as a fact, the Welsh like good preaching, and they regard the preacher as more important than the celebrant—that is to say, they do not regard the sacerdotal part of the celebration as we do in England. They like a man in the pulpit of their own rank—a man from the farmhouse, or from behind the counter of the grocer's shop. Those are the men who are drawn into the ministry of the Calvinistic Methodist Church; those are the people who go about from place to place to administer religion in Wales; those are the men whom the people trust. They have them to tea at their farms, they give them dinner on Sundays, and these ministers acquire an influence and a power over the people by their eloquence and their self-denying work
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which it is impossible to over-estimate. Those are the men who to-day hold the mass of the Welsh people in the hollow of their hands; those are the men who have persuaded the people that they should have Disestablishment; those are the men who have sent persistently a majority to the House of Commons in the last twenty or thirty years in favour of Welsh Disestablishment. Noble Lords have only to look back on the history of religion in England to see how the same thing obtained here 200 years ago, when the Puritans loved preaching, and set an example to the whole country. The same is true in Scotland to-day. You do not in that country go to St. Mary's or to St. Cuthbert's, but you go to sit under Mr. Brown or Mr. MacGregor. Those are the men who have made Scottish religion, and who have kept the Presbyterian lamp burning so brightly. Then why blame the Welsh people because they care more for that than they do for the surpliced ministrations of the beneficed clergy in Wales? You have the same in Ireland. The Irish priest is a peasant-bred man, while if you go to France you find that the French priest also is a man of the same class. In most Christian countries, in fact, you find that the men who minister to the poor come from their own class, and often are not much more highly educated than those before whom they preach. These being the facts we have to face, is it any use referring to ancient history and the great traditions of the Church of England? It must be acknowledged that, after all, this Bill only proposes to give to Wales what Wales asks for, and to suppose that this little act of justice is going to ruin irretrievably the great Established Church to which the mass of the English people belong is to take a false view.
The Welsh people are determined to have this measure. A Welshman is naturally conservative to the backbone; he is a man who respects his traditions. A Welsh farmer is unwilling to embark on any new ideas; in social life he is conservative; all his ideas are conservative. Yet the mere fact that he wants the Church disestablished makes him a Radical in politics, and compels him to vote for a Radical candidate at every election. I believe that if the Church were disestablished you would have a great change in Welsh political feeling, and that the natural conservatism of the people would find

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expression at the polling booths. A question has been raise as to what is the actual majority of persons in Wales in avour of Dissent. All I can say is that no religious census I know of can be taken in Wales or any other part of the country, because you can never estimate the number of people who believe in a particular religion merely by the number of communicants. You have to consider the adherents, and when you have taken the mother of the family into computation, then you must take the children. I venture to say that if a census were taken on those lines there could be no question on which side the majority lies. The mere fact that the county councils are practically dominated by the Nonconformists and that the Welsh Members of Parliament are elected by Nonconformists, shows that the heads of the households in Wales are all of that way of thinking. And you may be pretty certain that their families will follow them on the same lines.
My opinion is that if this Bill were carried and the Church disestablished you would greatly strengthen the numbers of the Church in Wales. The more ornate services of the Church would attract people. In many English towns you find that numbers of people go to chapel in the morning and to church in the evening. It would be the same, I believe, in Wales. But at present a kind of social stigma attaches in Wales to farmers and tradesmen through being connected with the English Church. It is the same kind of stigma which in some parts of England attaches to people who absent themselves from the Established Church. The noble Viscount opposite, Lord St. Aldwyn, referred to the question of Presbyterian union in Scotland, and pointed out that latterly there has been a movement to unite the United Free Church with the Established Church in Scotland. Why is that so? It is because the ritual is the same, and the only bar to the union is the fact of the Erastian connection of the latter Church with the State. If that union comes off, I venture to say the first thing that will be done will be to remove the shackles of its State connection.
Finally, may I appeal to something perhaps lower than religious prejudices? I appeal on a mere question of tactics. Is it desirable that this Bill should be rejected? Is it desirable that, having regard to the pressure which is used in
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favour of this Bill from Wales, it should share the fate of those other Bills which your Lordships have killed on Second Reading without hope of amendment? I venture to think, and I speak as an old Parliamentary hand, that it is not in the interests either of the Welsh Church or of your Lordships' House that that course should be adopted. There is a time when you can surrender without dishonour. You have fought a gallant fight. No fight could have been fought more valiantly than that for which the right rev. Prelates have been responsible; but the time has come when you might very well say, "We will surrender to a greater power; we will march out with colours flying." If the House takes that view I am certain that a brighter future for the Church in Wales would shine before us. If the House takes the opposite view, I am sure that the public, especially in Wales, will feel that the Parliament Act has been justified and those who, like myself, hope for a closer bond of sympathy between the two Houses of Parliament will again be disappointed.
THE EARL OF HALSBURY: My Lords, I have endeavoured to follow, and I am afraid I have not been very successful, the reasoning of the noble Lord who has just addressed the House. To speak quite frankly, I am not certain that I understand now the relevancy of the greater part of the observations he has made. We are discussing this Bill, and a discussion which involves the history of religion through the centuries is not to my mind particularly relevant to what we have to deal with here. I must say I believe this debate has been of infinite value. I do not think, when one looks at what has been debated and what has been admitted in the course of these discussions, that it will be possible to get a stronger case for the four dioceses of the Church of England in Wales than has been made out by the admissions from the other side of the House. Over and over again one asks oneself what is the case for taking away the property of the Church of England in Wales, or what is the grievance on the part of the people of Wales against the four dioceses belonging to the Church of England in Wales. Over and over again one has asked, What is the grievance? but nobody has been able to answer the question or has attempted to answer it.
I read with something like amazement what was said yesterday by the right rev.

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Prelate the Bishop of Oxford. He recommends your Lordships to read this Bill a second time, and he stated at the same time that to one part of it he was undoubtedly and strongly opposed. I cannot suspect the right rev. Prelate of giving your Lordships illusory advice. But I would like to say this. Excepting the right rev. Prelate himself, is there a single man in this House who believes, if any material portion of that part of the Bill to which the Bishop of Oxford says he is irreconcilably opposed was amended by your Lordships, that there is the slightest chance of that Amendment being accepted in the other House? It is childish to suggest it. That the right rev. Prelate should recommend your Lordships to accept the Second Reading and then suppose that it is possible that the Bill could be amended in that direction is, as I say, childish, and I will not further pursue it.
Over and over again those who have put forward the question of the people of Wales being opposed to the Church and being desirous of having it first of all disestablished and then disendowed, have been challenged with this proposition: If it is a question of the number of people—although I myself should not admit, even if the numbers were greater than they are, that that was a reason why a Christian Church should be disestablished and disendowed—but supposing it were a question of numbers, what is the test by which you can find out the real feeling? Many times have I been in the Lobby voting for a religious census. Who have opposed it? Why, those who are maintaining now the propriety of disestablishing the Church simply on the ground of numbers. Over and over again that request for a religious census has been made, and no answer has yet been given to it. I know something of Wales, and I do not believe that it is true to say that the enormous majority of the people of Wales are against the existence of the Church. Widely diffused as the subjects are with which Parliament deals, is there any subject except this one where statistics are not the first thing applied to it when you are dealing with numbers? Why is it that His Majesty's Government are afraid to have that test, the only test which can be applied when you are dealing simply with numbers? Why is it that you object to it? No answer has yet been given to that question. I could instance many times, both in this House and in the
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other House of Parliament, when it has been demanded and has been refused. What is the inference? When people keep back evidence the inference always is that it is a symptom that the evidence is not in their favour.
When you cannot get an answer to the demand for a religious census on such a subject, the only thing left is to appeal to the newspapers. I see in the Western Mail of yesterday this statement, which is said to have been made by Mr. Henry Radcliffe, a justice of the peace, a prominent Welsh Nonconformist, and formerly Liberal candidate for Merthyr. I observe, further, that there has been an address to him to ask him to become the Liberal candidate for some other constituency in Wales. This is what he says—
"To-morrow the Peers will be called upon to decide by their votes whether the Bill is acceptable to the people of Wales or not, whether there is absolute evidence that the transference of the endowments of the Church to secular purposes is approved by the people concerned in the question. No one can pretend that it is. As a matter of fact the indications have all pointed in the other direction. From time to time during the troublous stages of the Bill the Government were made to realise that they had not the country behind them in this matter, nor were there signs wanting of a spirit of revolt among Liberal Members, whose defection in important positions would have rendered the defeat of the Government on eight occasions possible but for the kindly help of the Irish Nationalists. Speaking as a Welsh Nonconformist and on behalf of the increasing body of Welsh Nonconformists who view the Government proposals with disfavour and indeed with anxiety, I do not hesitate to say that if a referendum were made to the Welsh people on the issue there would be a great majority in favour of reserving the endowments in question for religious purposes. Under these circumstances the Peers will be justified in taking the step which they are expected to take to-morrow for the rejection of the Bill, and it will have the effect, and there is reasonable ground for thinking that it may, of securing an ultimate reference to the people. The Government base their proposals on an alleged mandate from Welsh Nonconformists. It is my firm belief that now the proposals are more clearly understood Welsh Nonconformity is very largely hostile to the secularisation of these funds."
I do not know who this gentleman, who is described as a prominent Nonconformist and a justice of the peace, may be, but he has published this in the newspapers and he claims for himself and for a large body of Nonconformists that that is their view on this subject.
The evidence on the other side is based on the question of numbers, and no doubt

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the numbers show a great majority in favour of this particular Bill. But when one has heard what has been stated by those who live in Wales and who are members of your Lordships' House, it is impossible to suppose that the feeling which is alleged to exist against the Welsh Church is what it is stated to be by those who are simply very violent political antagonists; and when one speaks of the members of the House of Commons it is impossible to dissociate what I might call the political element, the adverse political element, from this question so as to ascertain whether or not they are voting in that direction because they object to the Church, or because they have other views which they insist upon in the votes that they give. I confess that among other things I have been struck with is the mode in which the solemnity of this question has been overlooked, even, may I say with respect, in the speeches of two of the right rev. Prelates who have addressed your Lordships. This question is treated as if it were the most indifferent thing in the world. It seems to me a serious thing that in this particular place you can find advocates for taking away religious endowments contrary to the whole spirit of our laws. Hitherto I certainly have been under the impression that if there was one thing that gave an indefeasible right it was long possession; but I see that when one begins to discuss such questions as the noble Lord opposite was discussing upon the subject of tithe, and so on, all the authorities in law which I have been all my life supposed to recognise are swept aside and the ipse dixit of the Home Secretary is accepted. Lord Selborne, the father of the present noble Earl here, and other authorities are swept aside, and the ipse dixit of the Home Secretary is accepted as perfectly conclusive. My Lords, I believe that such treatment as is proposed by the Bill is absolutely inconsistent with that which we have held in reverence for centuries as the foundation of property.
This is a subject for serious meditation to anybody who looks at the signs of the times. I am not going into questions of theology. I shall confine myself to the Eighth Commandment. In these circumstances it seems to me that of all times in the world this is the very last on which you should strive to weaken the bonds which tie men together in religious life. I
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was struck by what the noble Lord who raised the tone of the debate last night so much—Lord Balfour of Burleigh—said as to the religious life which the State indeed may elevate or depress; and if the State sets the example of taking away from the poor and taking away from an institution which has lasted for seven centuries what belongs to it, in spite of the recognised principles upon which property is held in this country, it seems to me it is an extremely bad example. It is very inappropriate in the times in which we live for the State to set an example of that sort. I wish to associate myself thoroughly and entirely with what was said by the right rev. Prelate who addressed your Lordships first to-night. I say that the State has no right to take the four dioceses of the English Church in Wales and dismember them. It has the power, as the noble Lord opposite suggested, but it has no right to do it. Of course, Parliament has power to do anything; but it has been recognised, I think, all through our history that Parliament has no right to do such a thing except in such circumstances as have been stated over and over again—i.e., if the property has been misused. I will not go through the whole category again. But to take away that which it did not give from an institution which has undoubtedly not been guilty of any wrong against the law and on which it has for several centuries maintained itself, is grossly unjust. It is a very dangerous thing indeed for the State to set an example of doing that which it has no right to do—to dismember a Church and to take away from it property which Parliament never gave to it and which the Church has the right to retain.
As I have said, I believe that the admissions made in this House by supporters of the Bill are the strongest case that could be made against the Bill. There is no doubt that at all events we still recognise the obligations of religion. No right exists to take away property that does not belong to you. There is no doubt that on this occasion you are asked to take away property which is being properly used and used for the purpose for which it was given, and property which is of inestimable value to the country. All this you are asked to do on no other ground whatever than that the people of Wales wish it. I for my own part, dealing with such a question as this, would not admit that that was a

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sufficient reason even if it were true. But assuming that that is a reason, I maintain that there is no proof whatever that there is such a feeling in Wales. By Act of Parliament is said you may do anything, and you may; but by doing this you are setting an example of the absolute disregard of the principles on which property is held in this country. Although you may starve an already poorly provided clergy and make their lives more miserable and make it more difficult for them to do their duty, not believe for one moment that by so doing you will strengthen your own position. On the contrary, you set an example of absolute disregard of what in this country has been looked upon at all events as one of the most sacred elements of property—that that which has been long possessed and long enjoyed and not abused shall not be taken away without reason.
I believe that this debate itself will be the strongest argument in favour of rejecting this Bill. The tone of the debate has in one sense been a great improvement on what we have read in another place, because here we have had admissions made that the Church of England in Wales has been doing its duty, that it has been acting efficiently, that it has improved and is improving and increasing. Notwithstanding that, you are asked now, with no statistics to justify it, to say that the Church in Wales shall be disestablished and disendowed in order to proceed, I presume, with some of the scientific experiments in the various county councils; and that is to be in substitution for Christianity. Because there can be no doubt whatever that in proportion as you take away the means you take away the power of diffusing, what ought to be the primary object of every State to diffuse, Christianity among the population. This is a Bill which ought to be absolutely thrown out without the least regard to the power of amendment which has been suggested by the right rev. Prelate the Bishop of Oxford, which is purely illusory. I do not know, after what he said last night, what he would say if the Bill came back again with his Amendment, such as it was, thrown back upon him and he was then asked whether we would pass the Bill as it stood denuded of his hypothetical Amendment. But I am confident that your Lordships will, without the smallest hesitation, reject this Bill to-night.
THE LORD BISHOP OF ST. DAVIDS: My Lords, I desire, as a Welsh Bishop, to express my most respectful gratitude to the noble and learned Earl whom I have the honour to follow for the way in which he has to-night used the weight of his great authority and experience in the cause of justice. The reasons why Welsh Churchmen appeal to your Lordships to refuse this Bill a Second Reading to-day have been expressed by the right rev. Prelate the Bishop of St. Asaph in a powerful speech, which commanded the respect of all parts of your Lordships' House, delivered under circumstances of special difficulty with that public spirit which is very characteristic of my right rev. brother. Four noble Lords from Wales, of whom the Church in Wales has good reason to be proud, have submitted to your Lordships the reasons why Welsh Church laymen oppose this Bill root and branch. To sum up the position which we Welsh Churchmen take in this matter, I would say we ask your Lordships' House to refuse this measure a Second Reading because it is a measure of great gravity, and because it has not been put, as it ought to have been put, before the country.
I presume that no noble Lord in this House will deny that this is a measure of great gravity. I assume that His Majesty's Government admits that. The Chief Secretary for Ireland once truly observed that Disestablishment was "a great and grave" question. I also presume that the noble Marquess the Leader of the House, when he sums up the debate, will not claim that this Bill has been put before the country, at the last General Election, in any real or effective sense, or in any sense approaching the fair and square way in which the greatest Liberal of the last century, Mr. Gladstone, put the case of the Irish Church before the country in 1868. Your Lordships will remember how the noble Viscount the President of the Council, who speaks with special authority of all that concerns Mr. Gladstone, said here that though Mr. Gladstone's Government of that time passed many Liberal measures, one and only one question was the essential question before the country at the General Election of 1868. I think the noble Viscount's words were that "the electors had in the forefront of their electoral vision" the question of the Disestablishment of the Irish Church. As a contrast to

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that, what happened at the last General Election with regard to the Disestablishment of the English Church in Wales? Take the election addresses. There were only four Liberal candidates in the whole of England, excluding Wales, who mentioned Welsh Disestablishment in their election addresses. Is that putting it before the country? Take the platform speeches. As far as I have been able to ascertain there was not a single Cabinet Minister who mentioned the matter in England on any platform, except the Prime Minister, who, in a speech at Hull, did not discuss it but did mention it by way of formal notice as if—if I may so speak with great respect of such a great man—he were serving a summons to a County Court.
I am not going into the constitutional question. It is not for me to discuss the theory of mandates, but I was very much impressed with the right rev. Prelate the Bishop of Oxford's observations last evening about majorities in the House of Commons. As I shall have to refer to his powerful speech more than once, I hope he will allow me to thank him for that speech most sincerely and for his candour as well as for his sympathy. I believe in frankness. I think it is as well to know where we are and to clear the air, and I shall most respectfully endeavour to follow the right rev. Prelate's example and be frank in my turn. He drew an eloquent and striking contrast between the "small" and "precarious" and "strangely-constituted" majorities by which this Bill was saved by the skin of its teeth by Irish Nationalists several times in Committee and on Report in another place, and the "solid and unreduced" majority on Third Reading which sent this Bill to your Lordships' House. The argument of my right rev. brother was that because of that contrast this House would do wisely and rightly to give this Bill a Second Reading, while insisting upon—I hope the noble Marquess and the noble Earl on the Front Government. Bench noted those words—substantial Amendments in Committee. What struck me last evening, and I think what struck us all, was the false antithesis of the right rev. Prelate. It so happens I hat what he called the solid, unreduced majority was indeed a strangely constituted majority for a Bill of this kind. I do not think that the right rev. Prelate was aware that there was not a majority of votes
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from England and Wales taken together on the Third Reading of this Bill in another place. The majority was 107. It was indeed a solid, unreduced majority such as the power of Party discipline can produce, but it was composed of 66 Irish Nationalists and 41 Scottish Members.
This is a Bill which concerns Wales most closely and most directly, but it does not concern Wales alone. As the Bishop of St. Albans pointed out, it has no precedent at all in the history of this kingdom. The noble Earl who moved the Second Reading of the Bill will correct me if I am wrong. Is there any precedent for it in the whole of the British Empire? I go further and ask, Is there any precedent in any civilised country in modern times for such a Bill as this? It concerns the Church of England as a whole. The Westminster Gazette, on the day of the Third Reading in another place, exhorted Liberal Members to remember that the Bill would set a precedent for the Disestablishment and Disendowment of the whole Church of England. I was very thankful to the Bishop of Oxford for saying, with the candour which one always expects from him, that on the first principle of this Bill he was prepared to wage war with the Government without a truce. I refer to the principle of Dismemberment. I am quite sure the right rev. Prelate when he said that had not fully considered that according to the author of this Bill the principle of Dismemberment is the very "essence of any proposal to disestablish what is at the present time an integral part of the Church of England." The right rev. Prelate is as well aware as I am that the usual course, and the proper course I venture to add, for any one who is prepared to wage war without a truce against the essence of a Bill submitted to this House is to vote against the Second Reading, and not to endeavour to extract the essence out of it in Committee.
So much has been so well and ably said by much better authorities than myself—by the most rev. Primate, the noble Viscount, Lord St. Aldwyn, whom I desire to thank for his speech, and my brother the Bishop of St. Albans—that I need only trouble your Lordships now with one aspect of this question; that is, Dismemberment in its relation to and its bearing upon the sentiment of Welsh nationality. I am truly grateful that no speaker in your Lordships' House

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has denied the value and the reality of Welsh nationality. On the contrary, the two most rev. Primates have spoken true and sympathetic words about it. The question is not whether Welsh nationality is a fact or not; the question is what is its meaning and what is its bearing. At the First Reading of the Bill the Home Secretary presumed to take credit to himself for restoring the Welsh dioceses to the isolated position they occupied in the twelfth century. I am grateful to the Bishop of Oxford for supporting me in the view I take that ancient history is by no meats the Home Secretary's strongest subject. But, my Lords, this is no question of ancient history. The Home Secretary does not know much about ancient history, but he knows must less about religious liberty. The question is not what happened hundreds of years ago, but whether the great mass of Churchmen in England and Wales to-day value the organised unity of the Church on deep, religious, conscientious grounds.
The noble Lord, Lord Sheffield, from his interesting position of detachment from all theology, administered with gusto on the first night of the debate a lecture on Church principles to the Bench of Bishops. He took for his text, after the manner of some preachers, a wrong exposition of a word used by my right rev. brother the Bishop of St. Asaph, and I venture with all respect to say to the noble Lord that his lecture was as irrelevant as his text was mistaken. We thank the noble Lord for his instruction, but we do not require him to remind us Welsh Bishops that there are limits, thank God, to the mischief which it is in the power of Parliament to do to the Church of Christ. Yes, my Lords; but that is no reason for allowing the House of Commons to do as much harm to the Church of Wales as it possibly can. In the evidence before the Royal Commission—about which Lord Beauchamp, like his colleagues in another place, was discreetly silent except for a reference or two—a weighty Wesleyan Methodist witness expressed the strong objection which Welsh Wesleyan Methodists would have to being dismembered from the Wesleyan Methodist Conference The centralisation of that great Nonconformist Church is far greater than anything we have in the Church of England, but even in the wildest flights of denominational feeling, I have never yet heard anybody
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venture to suggest that Welsh Wesleyans are less patriotic or less sincere in loyalty to Welsh national sentiment than any other denomination of Welshmen.
Reference has been made here to a memorable decision arrived at in 1909 by the four Welsh federations of the National Free Church Council of England and Wales. A proposal had been put forward, in the interests of what I call Welsh political particularism, to dismember that great organisation of Nonconformists in England and Wales; but they put religion before politics and decided that it would not be for the good of the movement in Wales to have a distinct and separate Council for Wales. They were influenced in their decision, and rightly so, by the statesmanlike speech of one speaker who said that "nothing but good could come of the uniting of England and Wales in one solid force." Those are wise, true Christian words. There is an essential difference between particularism and patriotism. Particularism means the protection of selfishness, the cultivation of vanity, as the speeches of more than one Welsh Member of Parliament abundantly illustrate. Patriotism, on the other hand, means quite a different thing. It is a growing preparation for greater service. The true idea of Welsh nationality means no separation from England in any respect, least of all in religion, but the uniting of all Welsh people among wholesome varieties of opinion, political and religious, in persistent practical enthusiasm for the welfare of Wales, so that Wales may give its best more and more as time goes on for the consolidation of the United Kingdom and the strengthening of the British Empire for the service of mankind. The root of Welsh nationality does not consist in uniformity of opinion, political or religious, but in the unity of life and of a great patriotic purpose.
A great intellectual stand, supported by solid arguments, against dismemberment was made in another place by Sir Alfred Cripps and others. The Home Secretary was only able to plead with great pathos, in reply, that without dismemberment of the Church this "mean little Bill" for piecemeal Disestablishment and Dismemberment would be impossible. I think a weighty speaker said yesterday that if that was so, so much the worse for the Bill. Let me quote a fine reply given

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in anticipation to Mr. McKenna by a man whom I am proud to call my friend, a man who has taught me a great deal and who, in my humble opinion, is one of the ablest thinkers in the country. He is as strong a Liberal as the Home Secretary and I believe a stronger Nonconformist, and he is a firm believer in the principle of religious equality. I refer to the Rev. J. Bradley, who possesses in a large degree the virtue of manly courage. He was quoted by Lord Kenyon. In his book on Nonconformists and the Welsh Church Bill, he says—
"To sever the Church in twain by legislation against its own desires and aspirations, against its prayers and pleadings, without, it seems, care or concern for its future, will stand out as a legislative crime against the very life of that Church. If Disestablishment essentially involves that, Disestablishment from every point of view, religious and spiritual, is without defence."
I wish the right rev. Prelate would imitate—I will not say the courage, for he has plenty of that—but the consistency of Mr. Bradley, for Mr. Bradley has taken his courage in both hands and made immense sacrifices in denouncing this Bill.
Piecemeal Disestablishment in itself is essentially unfair to democracy. It is not loyal to the central principle of democracy for Parliament to try and do a great and grave thing, as Mr. Birrell called it, while hiding from the people of this country the real magnitude of the thing that is going on. The piecemeal method, which is the foundation of this Bill and its distinctive characteristic, only obscures the real issue and puts in the forefront a subordinate issue. The real issue is a religious issue, the subordinate issue is a political one; and I object to the far greater issue being mixed up in this way with a merely subordinate one. In my opinion this piecemeal method is fatal to anything like a rational discussion of the issues raised in the Bill. Thankful as I am to the Bishop of Oxford for his speech, I noticed even in that powerful speech a marked inequality—I almost go so far as to say a painful inequality—between the political and the religious parts of it. That speech, great as it was, would have been very much greater if this was not a question of piecemeal Disestablishment.
What is the real issue? There are two great principles in question—the national recognition of religion and the principle
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of religious equality. The question we have to ask about those two great principles is, first, Are they essentially incompatible? Many of the Nonconformists who support this Bill—and I prefer to take them as a type of the rest—support it on religious grounds, but the Nonconformists of Wales have no desire whatever to secularise the State or national life. I can point to Lord Pontypridd as a most admirable example of the type I am referring to, and I for my part am very glad to see that type represented in this House by the noble Lord. They have got mixed up in this matter between the incidents and the essence of Establishment, and when I listened to the Bishop of Oxford referring to what lie called a certain kind of piecemeal Disestablishment going on, I asked myself what he meant. It is perfectly true that various trappings of Establishment have been removed, and I think for good, one after another by a gradual, wise, and statesmanlike process; but the root of the matter, the real issue, is, Shall this country go back on its history and give up the national recognition of religion? I may pause to say that, so far from there being anything in the circumstances of Wales to require this experiment to be made in the Principality. I think Wales should be the last part and not the first part of the country to give up the national recognition of religion. The noble Earl who introduced the Bill gave us some figures, but in doing so forgot a profound obiter dictum of the Chief Secretary for Ireland, who besought Dissenting Deputies whom he was addressing after lunch, as I have no doubt he had often besought his colleagues before—
"I do ask you" said Mr. Birrell, "to argue this question on principle. Do not be content simply to run about counting heads and noses, and trying to make out, one way or another, that the Church in Wales ought to be disestablished."
If the noble Earl meant to rest his case, as he did, on religious statistics in Wales, surely he would not have taken the course he did in this House of opposing the religious census asked for by Lord Newton. It is unworthy of His Majesty's Government to refuse a religious census in Wales such as was given in Ireland before the Irish Church was disestablished, and then come here and guess at figures. Both the Home Secretary and the noble Earl have been guessing at figures, and I would say to them that if they must guess they might have made better guesses. Both the noble Earl and Mr. McKenna

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have guessed wrongly at the strength of the Church in Wales, and the noble Earl did as the Home Secretary did in the case of Cardiff—he divided the strength of the Church by two. I will give the noble Earl an official fact instead of guesses. The greatest Nonconformist body in Wales is the Calvinistic Methodists, and in their Year-book which has just been published they give the total number of their adherents, men, women and children, and they come to just one-eighth of the present population of Wales. I think the noble Earl relied on the precedent of Ireland. He knows quite well that in Ireland there was a single Church, the Roman Catholic Church, with its adherents amounting to three-fourths of the population, whereas the largest denomination in Wales only numbers one-eighth; yet the Irish precedent was delightful to the noble Earl! I do not want to go into figures. I only thought that some one ought to challenge the noble Earl's figures. When he challenged the figures of the right rev. Prelate the Bishop of London, the noble Earl reminded me of a Senior Wrangler so strict was he in dealing with the figures, but he displayed no caution at all in the figures he was good enough to guess for us.
Now let me go back and try and do what Mr. Birrell asks us to do—argue this question on principle. Let us look at the history of Wales. What is the most distinctive feature of Welsh national life? It is that all through Welsh history, from its first beginning, some centuries before St. Augustine came to Kent, Welshmen have been lovers of religion. A striking example of an unfortunate lapse from patriotism to partisanship was afforded by my brilliant countryman the Chancellor of the Exchequer when he said in the House of Commons that Wales, his beloved Wales, had been wallowing in a slough of perdition until a century ago. Mr. Gladstone, who also loved Wales as Mr. Lloyd George does, but who knew its history, said some years ago at the Welsh Eisteddfod that aspersions on Welsh national character in past days had been made of which he did not believe a word. The Chancellor of the Exchequer picked out the golden age of Welsh history, the age of the Tudors and the Stuarts, to blacken it as an age when Welshmen were "absolutely indifferent to every form of religion." Time will not permit me to correct the right hon. gentleman's history. I will content myself with the broad
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proposition that, apart from these controversies, plenty of authority can be found for the fact that Welshmen have been all along just as they are to-day lovers of religion. What about the present time? The Royal Commission reported, in its Majority Report, that the Welsh people show a marked tendency to avail themselves of the provision made by the Churches of all denominations for their spiritual welfare. The right rev. Prelate, the Bishop of Oxford, though he did not say it last night, feels that one of the difficulties in the way of national religion is that there is such great indifference to religion in parts of England. He ought to have paused at Wales, because in Wales the indifference is not so far gone as is the case in England.
Let me come to what I consider the root of the matter at issue between the right rev. Prelate and myself. I think he has taken a one-sided view of the relation between the Church and Nonconformists in England and in Wales. I would not have presumed to pit my judgment against his had I not been able, which he is not, to speak on this subject with a knowledge of this question from two sides, because I have the honour to be the son of a Welsh working man who was a Nonconformist deacon. It is perfectly true, as the right rev. Prelate said, that there is a difference, a real difference which I for one do not wish at all to minimise, between the Church and our Nonconformist brethren, and if you asked me to sum it up I should not put my finger on the conception of the ministry to which he referred, but rather on the conception of what is meant by Church and by Christian unity. I think there have been times when Nonconformists have been in the past too apt to think that the root of unity lay in uniformity of opinion. It lies in unity of life, and that change of standpoint "incredible in its magnitude" to which the Chancellor of the Exchequer bore witness in the House of Commons means particularly this, that the distinctive opinions which used to separate various Welsh Nonconformist denominations from each other are disappearing, if they have not all but disappeared, and therefore the road is nearer, I think, to a cordial understanding between Churchmen and Nonconformists in Wales. Where I criticise my right rev. brother on this point is that he emphasised the difference between Churchmen and Nonconformists but forgot

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what the Pan-Anglican Congress did not forget, that the area of common agreement between Christian people in this country is, after all, far wider and deeper than the lines of difference. While one is a thing that needs to be taken into due consideration, the other is a most important and vital thing; and while the right rev. Prelate spoke—and no one is better able to speak upon the subject than he is—of the influence of modern thought upon English and Welsh theology, I think it is very unfortunate, from more points of view than one, to forget that there is a large area of common ground summarised in those fundamental articles of the Gospel of Christ which are summarised in the Apostles Creed. I do not for one moment want to suggest to your Lordships that there is anything like corporate reunion above the horizon in Wales, for I do not believe it; nor do I think the time has come for anything like a federal arrangement. But I do think the time is not far off, if this "mean little Bill" is defeated, for what the French and we call a cordial understanding.
There was one other point in my right rev. brother's powerful speech which touched me greatly. He referred to the parochial system. So did Mr. McKenna. I am prepared to show that, according to the author of this Bill, one of its main objects is to wreck the parochial system in the Welsh country parishes. Mr. McKenna talked of 106 parishes in Bangor and Llandaff in order to support his contention as to waste of money in country parishes, but as he did not give the names of these parishes it was impossible to check him. But I know something about the Home Secretary's arithmetic by this time, and I venture to say that he is not likely to be more right on this occasion than he generally is. I was able, however, to check the Home Secretary in regard to my own diocese of St. Davids, and Mr. McKenna said that his argument applied much more to the dioceses of St. Davids and St. Asaph. There are sixty-two incumbencies in the diocese of St. Davids, with an average of thirty communicants. In these parishes the population is 354 on an average, and therefore this group of sixty-two country parishes has about as high a standard—a very small shade lower—of proportion of communicants to population as the whole Church of England and Wales. The average area of these parishes is seven square miles, and the average
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income £166. Taking those figures, the only conclusion possible to draw from the speech of the Home Secretary is that he aims by this Bill at definitely wrecking the parochial system of the Church in these rural parishes. The Church is the only religious body in Wales that works on the parochial system. I could give figures showing the failure in Wales of the voluntary system, which the noble Earl said had never failed in the world. He evidently has not read the South Wales Press or Mr. Radcliffe's weighty letters. In the Western Mail there has been an interesting discussion going on about the merits of concurrent endowment, on which I am not going to enter. The protagonist of the Free Church Council in South Wales severely attacked Mr. Henry Radcliffe, of Cardiff, who I venture to say is a Nonconformist worthy of the greatest respect and who speaks with great authority. Dr. Cynddylan Jones, who is admitted to know more about South Wales than any Nonconformist minister, said—and it was common ground—that it was impossible for Nonconformity in Wales, as at present organized, to provide for rural parishes as they would like to do.
The right rev. Prelate the Bishop of Oxford spoke last night of "residual religion." I venture to think he ought to have called it "initial religion." He said that one of the greatest dangers to the Church to-day was the strong drift from membership. That was due to indifference, and that indifference is the greatest moral danger to-day in this country. It shows itself in politics as well as in religion. Yet my right rev. brother, by way of a remedy for this tendency to indifference, is prepared to allow the State itself to set the example of indifference to religion, particularly in its parochial application. What is the essence of the parochial system? What gives it its distinctive value? It is this, that there is a man in every area whose duty it is to take the Gospel to the homes of the people, whether they are indifferent to it or whether they are not, or whether they could pay for it or not. My right rev. brother says, Yes, but they would be much better Christians if they paid for it. I have heard Nonconformists themselves admit that there is a danger there, but on the whole I agree with him on that point. But here I differ. What is the stage at which an indifferent person comes to our public

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worship? The economic law of supply and demand does not operate in things of the spirit or in things of the mind, and those who are indifferent have first to be taught their need of religion before they will pay for it. I do not pit my judgment against that of my learned and able brother, but I would refer to the great Scottish thinker and divine, Dr. Chalmers. If your Lordships will read his great book on National Churches you will see, from the testimony he bears to the value of the parochial system, that not the least of the blunders which Mr. McKenna has made is to imagine that the parochial system of the Church means waste of money in the rural parts of Wales which are too poor to maintain a resident ministry without the aid of endowments.
Now to touch on Disendowment. Strange as it may seem to the Bishop of Hereford, and with all respect to his learning and his years, it is not Disendowment that interests me most, and to suggest that I would give up Disestablishment in order to obtain better terms on Disendowment is to misunderstand the entire position. The reason why I regard Disestablishment as far and away a greater evil to the country than Disendowment is that in the flow of time the evil of Disestablishment will be aggravated and not alleviated; it will grow greater one generation after another, whereas with the evil of Disendowment it will be the other way about. If you have to choose between two evils, choose the ill which you can heal; for the most dangerous ills that flesh is heir to are those which men do not feel at first. The man in the street pricks up his ears when he hears about Disendowment in this Bill, but he does not realise in the sane way the disaster of Disestablishment. The Bishop Oxford said that to run away from principle is a disaster. I entirely agree with him. There is a great temptation to us Welsh Bishops to swim with the stream. I think if we were to do so we might be very popular in Wales in a short time, for whatever failings the Welsh people have they certainly are not a sullen race. They are hasty, but if they believe that a man is honest and is really seeking their good according to his lights they will not be angry with him for long. But I submit that history teaches that one of the greatest dangers the Church of Christ has undergone in this world is to bow to the popular mood of the moment and swim
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with the stream. Therefore although I know that in a kind of way—because they do not understand it—there is a majority in Wales for Disestablishment, I decline absolutely to give up or abate in any way my whole-hearted opposition to Disestablishment as a principle in order to get better terms on Disendowment.
This is a question of justice and commonsense. The most rev. Primate last evening truly said that the arguments for Disendowment are in a state of absolute chaos as advanced by His Majesty's Government. That "horrible folly" which Professor Freeman denounced, the idea that property, which the Solicitor-General says belongs to the Church by solid title, is "national property," will not be supported, I am sure, by noble Lords on this side of the House. My brilliant countryman the Chancellor of the Exchequer, speaking of the distinction between the use of a trust and its beneficiaries with his picturesque confusion of thought, and the Home Secretary, with that rigid precision of uninformed dogmatism which characterises his mathematical mind, said that what you have to consider is not the use of a trust, but the beneficiaries thereof. What do you mean by the beneficiaries but the people who are entitled to derive benefit? This false antithesis between use and beneficiaries is absolute nonsense, with all respect to the Chancellor of the Exchequer. The real question is whether there is waste. It cannot possibly be established that there is a waste of this trust property in Wales, and the Parliamentary census makes it absolutely clear that there are more Churchmen in Wales to-day than there ever have been in its previous history.
Let me refer to the testimony of the Prime Minister, which was read in this House, to the strong devotion shown by the Church to the best needs of the people of Wales during the last seventy years. The Prime Minister is entitled to the greatest respect for making that frank admission in 1909, and for standing by it last year. I am entitled to say this, that if he were pleading the case of Disendowment and made that admission in any Court of Justice there is not a Judge on the Bench who would care to hear another word after that eloquent admission, but would stop the case against the Church at once and give judgment for the defendant, with

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costs. But I may be told that it is of no use talking about Courts of Justice in this connection. This is going to be done by the House of Commons, but, if it is done, His Majesty's Government will have poisoned the fountain of justice in this country by asking the House of Commons to use the power of the Parliament Act to do a thing which no Judge on the Bench would do in a similar case with regard to private matters.
The noble Earl will agree, I hope, that the two objects to which this sum of £158,000 a year is to be applied are education and public health. The State is in duty bound to make whatever provision is necessary to-day for education and public health. Therefore, my Lords, what the Government is doing is to take this money away from the Church and to give it to the State. If the Church had withdrawn its national service it might be right then for the State to take away a part of the money, as the Bishop of Oxford suggested, but when the Church is, according to the Prime Minister, more and more endeavouring humbly to do its duty by the State in this matter, then I say to take this money from the Church and give it to the State is another question altogether. I am not talking now of justice; I am talking of common sense. That is why I call this Bill a "mean little Bill." I have used that phrase in the country repeatedly and I want to stand up here and justify it. Can any one deny that for a State with a revenue of over £180,000,000 a year in its last Budget and a surplus of £6,000,000 in its Exchequer which the Chancellor did not know what to do with for months, for so wealthy a State as this, the wealthiest State in the world, to take away this small pittance from the poorest dioceses of the Church is a mean transaction? With all respect I say, therefore, to His Majesty's Government that this is a mean little Bill. In my humble judgment the way is open for constructive statesmanship to grasp the problem of readjustment of Establishment in England and Wales on the lines of national recognition of religion and true religious equality. What this petty Bill does is not that but to secularise Welsh religions endowments at the bidding of 31 Welsh Members. I say solemnly and deliberately that if you were to have a poll of the people in Wales to-day you would not get a majority for the secularisation of endowments—I do not say Disestablishment. What has given this
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movement whatever power it has had is this, a false idea—which is, thank God, on the wane—that what is good for the Church is bad for the chapel, and what is good for the chapel is bad for the Church. That is a false idea and it lies at the very root of this Bill. We are getting to see the evils of selfish competition in commerce, and you may depend upon it that the religious people of this country cannot keep up much longer an ideal of denominational competition for Churches which workmen decline to accept as an ideal in trade.
I look forward to a better understanding and to the dying out of this false idea of religious antagonism between the Church and Nonconformity. It is contrary to the best thing in the spirit of our age. The secret of what we call industrial unrest lies in a deep and passionate longing for brotherhood. This false idea is contrary to the best feature in Welsh character, the power of sympathy; it is contrary to the deepest aspirations of Nonconformists as well as Churchmen; and it is contrary, last of all, to the central command—nay, He himself said the one command—of the Lord and Saviour whom we all adore. On a measure of this great gravity I ask the House not to consider the votes of thirty-one Welsh Members a sufficient reason for giving this Bill, with its vicious principles, a Second Reading. I must remember that by my office I am in a position of trust as a Bishop of the Church with a duty to the past, to the old people of long ago who had no motor-cars or telephones or any of the inventions of modem science, but who knew one thing perhaps better than we do, that the worship of God is the root of the happiness of man. We owe them a duty. But, my Lords, what makes me speak without any hesitation and with a clear conscience against this Bill is that this generation owes a duty to the future. We are but tenants for life, here to-day and gone to-morrow; and this generation has no moral right whatever, especially without consulting the country, to secularise for all time the religious endowments of Wales. This Bill would take away every brass farthing of the ancient endowments of the Church in Wales, after they have been raided by Norman Barons, plundered by Henry the VIII, and further depleted by Cromwell's curious Propagators of the Gospel in Wales. Notwithstanding all the juggling with figures, that fact comes out clearly; and I say that you have no

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moral right to take this income away from the Church and divert it to secular objects. I apologise for trespassing so long upon your Lordships' time, and I thank you for the patience with which you have listened to me. I earnestly appeal to noble Lords on both sides of the House not to give this Bill a Second Reading without allowing the people of the country a chance of expressing their opinion upon it.
THE MARQUESS OF SALISBURY: My Lords, I think your Lordships will allow me to say without impertinence that perhaps the most striking feature of this debate, which has now continued for three days, has been the earnest eloquence which has proceeded from the Episcopal Bench in opposition to the Bill before the House, and, if the right rev. Bench will forgive me for one further observation, I think I may be allowed to say that what has most impressed the House has been the wealth of knowledge, the earnestness, the eloquence and the convincing arguments of the two right rev, Prelates who come from this unfortunate Principality of Wales. What a contrast to the only representative of His Majesty's Government! They spoke with confidence, but he was almost apologetic. His statistics and his figures—not his own, of course—have been blown to smithereens. But one cannot help being struck by the almost recklessness which the noble Earl must have shown in accepting these figures as they were given to him. I think that the motive is apparent. The noble Earl was somewhat ashamed of the Bill, and it was necessary for his purpose to eke out the case with the most convincing figures upon which he could lay his hands. It was unfortunate that they happened to be inaccurate. But what a testimony that is to the strength of the case. Why should it have been important for the noble Earl to show, or to try to show, that the endowments which were to be taken away from the Welsh Church were so small. If he and his Government really believe in Disendowment, if he really thought that endowments were bad for a spiritual body, if he really believed that these endowments of the Welsh Church were ill-gotten gains, he ought to have gloried in the size of what he was taking away and not tried to minimise it to the full extent of his power.
These apologies for Disendowment almost amuse one. Disendowment is represented
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to us as positively a benefit to the person or the community which is disendowed. It is as though in olden times a highwayman had said to his victim, "I want your purse, but do not trouble yourself, I am not doing you any injury. Just conceive how I am improving your character, what industry, what zeal I shall call out in you in order for you to make good the deficiency which I am causing you." And one can imagine the victim saying, "But I have a family, and I have certain dependants who rely upon my aid," and the highwayman replying, something like the noble Earl, "Well, that will call out the generosity of your friends; they will have to come to your rescue; that will improve their character, too. You take me for a robber; I am really a public benefactor." That is positively the kind of argument which is advanced in your Lordships' House to justify Disendowment. There was another argument, the argument of the right rev. Prelate the Bishop of Hereford. His argument appeared to be this, as far as I understood it. He said, "Everybody agrees that the Welsh Church ought to be disestablished; Disendowment is intimately wrapped up with Disestablishment, and therefore everybody agrees that it ought to be disendowed as well."
THE LORD BISHOP OF HEREFORD: I did not say that. What I said, or what I intended to say, and I think I actually said it, was that there was a great contrast between the discussions of twenty years ago and those of the present time, and that on this occasion Disestablishment had been comparatively little argued by the opponents of this Bill.
THE MARQUESS OF SALISBURY: If that was the right rev. Prelate's view, all I can say is he must be convinced that he was wrong after hearing the debates in your Lordships' House, for I think I may say that far and away the greater part of the time which has been occupied in the speeches to which we have listened has been occupied in discussing Disestablishment.
THE LORD BISHOP OF HEREFORD: I was speaking with reference to the public discussions in the country prior to the discussion which has taken place here.
THE MARQUESS OF SALISBURY: Then I hope that the right rev. Prelate will have been enlightened by the discussion which he has subsequently heard. I do not admit for a moment, even if the Church in Wales were disestablished, that it ought to be disendowed. I do not think there is any argument which has been advanced during the speeches I have heard on the present occasion which went to show in the least that it would follow as a matter of course that because the Church were disestablished it ought to be disendowed. In order to justify Disendowment noble Lords must look at the realities of the case. I am not going to labour the point now, for it has been discussed over and over again; but what is perfectly clear is that the Welsh Church, so far from being a rich Church, is a poor Church, and that so far from neglecting its duty it is doing its duty, and there can be no grounds whatever for depriving what is a poor Church of what is necessary to enable it to do its duty when that duty is being adequately performed. I believe this has already been said in the debate, but I will venture to repeat it. If you want any further argument to prove it look at the present action of the Ecclesiastical Commissioners. Under the present system the Ecclesiastical Commissioners award their grants according as they are required. If you look at the comparative statistics of England and Wales you will find that a far larger proportion of the grants from the Ecclesiastical Commissioners is given to Wales, and for that very reason, that the Church of Wales is a poor Church.
It has always struck me as peculiarly impossible to argue the case of Disendowment in Wales when it is shown that if you deprive the Principality in many of its districts of the services of the clergy of the Established Church there is absolutely nobody to take their place. That is abundantly proved. The right rev. Prelate the Bishop of St. Asaph, who delivered the other night one of the most eloquent speeches we have ever listened to, showed it in the case of his own diocese; and I am quite certain that the right rev. Prelate who has just sat down could show it in the case of his diocese as well. I think I am right in saying that rather more than one-third of the parishes in the diocese of St. Davids have no resident Nonconformist minister of any kind whatsoever. Yet you are positively suggesting that it would be
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well, in the interests of the community, to abolish the establishment and the endowment of the only religious body that is in those districts to minister to the spiritual and temporal wants of the poor. I think the case for Disendowment has been absolutely shattered.
The mistake which I venture to think has been made by so many speakers in discussing Disestablishment is that they identify Establishment with nothing but exclusive privilege. The right rev. Prelate who has just sat down has pointed out, I think with the greatest force, that the important part of Establishment is not exclusive privilege but the recognition of religion. As regards exclusive privilege much of it has already gone, but much more of it might very properly go. The noble Earl who introduced the Bill is, of course, quite aware of it. There was a passage in his speech in which he explained to us that the Church of England was being gradually disestablished, and the right rev. Prelate the Bishop of Oxford also spoke with scorn of piecemeal Disestablishment. He seemed to think, which I confess astonished me, that the gradual abolition of these exclusive privileges of the Church of England was a great disaster. I do not think he meant it, but otherwise why should he speak with such scorn of piecemeal Disestablishment.
THE LORD BISHOP OF OXFORD: I thought that Disestablishment was so much in the air that it became inevitable, and I would rather that it were done openly than that it were done in the manner that I call piecemeal Disestablishment, which in fact means that the advantages and strength of Establishment are to be gradually and subtly withdrawn while at the same time the Church retains all the disadvantages and fetters of the established position.
THE MARQUESS OF SALISBURY: I do not agree with the right rev. Prelate. I do not think, properly considered, that Disestablishment is in the air. On the contrary, it is the other tendency which we are really witnesses of. The right rev. Prelate objects to losing the advantages of Establishment while he still has to submit to what he called the intolerable fetters and bonds of Establishment. Far be it from me to say that the actual position of the control of

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the Church of England by the State is ideal. I think, as I have often said, that there ought to be greater liberty in the Church of England to manage its own affairs. But I believe that would be perfectly compatible with Establishment. What has been done in Scotland could be done in England, and there is no reason why the fetters and bonds of which the right rev. Prelate complains should not be struck off. But I should not like to go so far as to say, having regard to the enormous importance of the Church of England, having regard to the many points at which it touches so closely the welfare of the people, that it would be well that there should be no sort of State influence over its conduct. I avow myself so far an Erastian as to believe that the balance which the State affords to the Church is a permanent advantage to the Church, and that it would not be well that it should be absolutely and perfectly free.
I turn to the point of the very courteous interruption of the right rev. Prelate, and I assert with great respect that he is not right, but wrong, in saying that Disestablishment is in the air. During the whole course of my political life we have been witnesses of what the most rev. Primate the Archbishop of Canterbury called the striking off of the disabilities of the Nonconformist bodies. Let me give a few examples, all of them being examples of Establishment and not of Disestablishment—that is to say, of the recognition of religion by the State. First of all there is the well-known case of the rating of ecclesiastical buildings. Every one knows that Nonconformist places of worship are not subject to taxation. Then take the case of the burial laws. Everyone knows that under recent legislation the Nonconformist minister has the right to read the service which belongs to his denomination over the burial of his co-religionists in the churchyards. Every one knows that the old monopoly of the Church of England in respect to the administration of marriages in churches has been balanced now by the Marriage Acts, under which Nonconformist ministers and Nonconformist places of worship are licensed to celebrate marriages. We see the same tendency going on every day. There is a Bill now before Parliament to enable Nonconformist bodies to acquire places of worship. I do not think much of the Bill myself; I do not favour it, but I recognise the grievance and
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should like, so far as my humble opinion is concerned, to give any recognised religious body the absolute right to acquire some place where they can build a chapel in which to worship God after their own heart in any part of England. But that is all Establishment. That is the recognition of religion by the State in every instance which I have given.
The last and the greatest and the most important case is the case of education. Establishment has gone so far in the case of education that the State has absolutely established a new religion of its own, a thing which we know as Cowper-Temple religion. I cannot say that I defend that experiment. I think it very wrong that the State should lay down what are the proper tenets of religion; but all of us on this side of the House, I believe, are in favour of giving what are called "facilities" to Nonconformist bodies in our schools. When that comes about that will be Establishment—it will be yet a further recognition of religion by the State. Indeed, in every direction we witness this phenomenon, that the State is willing more and more to recognise organised religion. Your Lordships will realise what this means when you contrast this attitude with the attitude of the Nonconformist bodies thirty years ago. Then it was different. They were entirely opposed to any recognition by the State of religion. That was shown, of course, in the education controversy. I do not know whether your Lordships have ever read the evidence which was given by the Nonconformists before the great Royal Commission on Education about thirty years ago. The argument then was this, that it was immoral that the State should have anything to do with religion; that it was ipso facto wrong that the State should prescribe in any form or exercise coercion in any form in respect to the teaching of religion. That has all passed away. The Nonconformists themselves have absolutely abandoned that attitude.
LORD PONTYPRIDD: Not altogether.
THE MARQUESS OF SALISBURY: They have in practice, if not in theory. The Nonconformist bodies admit as clearly as we do that the State may and ought to give facilities for and recognise religion;

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in other words, that the State may and ought to accept the principle of Establishment so far as the recognition of religion is concerned. What is the reason for this change? The right rev. Prelate the Bishop of Oxford, in a passage which I think deeply impressed your Lordships and which certainly deeply impressed me, spoke in a tone of profound regret of the condition of religious opinion in this country. Far be it from me to make any comment upon that assertion of his. There is no man in your Lordships' House who is able to speak with greater authority upon such a subject as that than the right rev. Prelate. We know how splended has been the work he has done in the various dioceses over which he has presided to combat the irreligion of which he speaks. But does he not think that this recognition by practically the whole of British public opinion of religion and of the function of the State with regard to religion is really caused by the consciousness we all have of these forces of irreligion which are being marshalled against us? Nonconformist bodies themselves, earnest religious Nonconformists, are as well aware as we are that we can afford to cast aside no weapon in the struggle which lies before us, and they are therefore much more willing than they formerly were both to accept the recognition and assistance of the State and to join with the Church of England in opposing the common enemy. That being the state of opinion, I would make an appeal to Nonconformists. Surely they will lay aside some of the old arguments for Disestablishment, which are really out of date and not believed in by themselves; and surely, having cast them aside and received our assurance that the Church does not care about the exclusive privileges which are so bitter to them—privileges that we have given up one after the other, and, so far as I am concerned, I should not be sorry to see all of them go—they might acknowledge with us the essential necessity of helping forward religion by the action of the State and by the recognition of Establishment. I go a little further than that. I think they ought to be willing, not only to recognise Establishment, but to accept the primacy of the Church of England. Why should they not? They do not differ so much from the Church of England as all that.
LORD PONTYPRIDD: No.
THE MARQUESS OF SALISBURY: The noble Lord confirms what I say. I was very much struck on reading a passage from the evidence of a Nonconformist witness before the Welsh Church Commission. It is the evidence of the Rev. Thomas Jones, ex-chairman of the Welsh Congregational Union. The Chairman of the Commission asked him—
"Are the differences between the Episcopal Church and your Churches in matters of doctrine very great?"
The witness replied—
"No, not very great. I think we aim at the same thing."
I am not sure that I should be able to say that, but what I desire to point out to your Lordships is that Nonconformists themselves are beginning to recognise that the differences compared to the agreements are very small. I will read another passage. The Chairman said—
"I am asking you whether you can specify any doctrine of the Episcopal Church, a principal doctrine, that you object to as being wrong."
This was the answer—
"We do not keep away as Nonconformists from the Church of England on account of any point of doctrine."
Then a further passage—
"You have just told me that you do not keep away from the Church of England on any point of doctrine. Then why is it that you do keep away from the Church of England."
And the witness answered—
"On account of its connection with the State."
I have just shown that, if that is the only reason, it is in fact and in truth and in essence already abandoned by the Nonconformist bodies.
That quotation has another significance. Your Lordships will remember that last night the Bishop of Oxford repudiated the Scottish case. He had been very much struck, as we all were, by the speech of my noble friend Lord Balfour of Burleigh. Lord Balfour had shown that the Scottish case demonstrated how we might hope that religious bodies which had been much divided in sentiment and dissenting bodies which had been bitterly opposed to the Establishment might be brought round to take a different view. The Bishop of Oxford said—
"That is no precedent; you cannot compare the differences of opinion between the different Scottish Presbyterian bodies with the differences of opinion which exist between the Church of England and the Nonconformist bodies."

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What was the difference between the Scottish bodies? I can assure your Lordships I am not going into any doctrinal matter. The principal difference was, of course, the connection with the State. That was the point upon which they split. I have the authority of the Nonconformist witness I have quoted that it is that and precisely that which is the cause of difference between the modern Nonconformist bodies in Wales and the Church of England in Wales. Therefore I say, if that witness is to be believed, the Bishop of Oxford is wrong, and the Scottish precedent is a good and sound precedent and may be quoted as showing that we may hope that before very long the Welsh Nonconformist bodies will themselves come to see that the principle of Establishment is not so wrong as they had thought.
May we not then hope that we shall have a recognition throughout Wales of the importance of a national recognition of religion? After all, the Welsh are an intensely religious people. It cannot be repugnant to them that the State to which they belong should itself do homage to religion; and when we have, if it may be possible, got rid of all the bitter feelings of privilege and reduced the problem to its true proportions and shown that it is the recognition of religion itself which is in issue, may we not hope that they will join us in supporting the Establishment? But if, unfortunately, it be not so, then alas! we cannot help it; we cannot surrender to their view; we cannot consent to dismember our own Church even for their sake. I am not going to repeat what has been said about dismemberment in the course of these debates. It is nut merely a matter of sentiment, although we would be the last to despise sentiment in a matter of this kind. We believe that we shall weaken the Church both in England and in Wales if we separate there into two bodies. I know it is said that you cannot force them asunder, that they may elect to work together even after Disestablishment; but my Lords, after all, though we are proud of the Welsh Bishops of to-day, there may be successors not so wise as they, and what guarantee have we that this very small community, the Welsh Disestablished Church, would be well guided by its four Bishops?
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And, my Lords, are we not to think of the minority? What guarantee have the Churchmen in Wales that they will have their interests as members of a great communion safeguarded by even a majority of Welsh Churchmen in the time to come? You would not allow such treatment to be meted out to much humbler societies than the Church of England. You would not allow it to be said to a great friendly society, "You have branches in England and Wales and we think the government and the administration of them ought to be separate; we cut you in half; we deprive the members of the society in Wales of the advice and administration of their English fellows; we deprive the members of the society in England of the advice and administration of their Welsh fellows." That would not be said to any commercial society. Why should it be said to the Church of England? We cannot admit that any case has been made out for Disendowment. We hope that with a little more time Welsh Nonconformists themselves will see that no case has been made out for Disestablishment. But whatever may be said of one or the other, Disestablishment or Disendowment, we will not consent to dismember the Church of England.
EARL GREY: My Lords, I have listened with the greatest pleasure to the speech of the noble Marquess. His speech encourages me to hope that he will be a foremost champion in a future movement for uniting the Protestant Churches of this country. The movement in Canada in favour of the union of the Protestant Churches is perhaps the most encouraging feature in the life of the Dominion. When one in the great position of the noble Marquess, whose influence arising from his personal character is even greater than that from his great position, approaches the Nonconformists in the conciliatory and sympathetic speech to which we have just listened, I say there is good ground for hope that we may be embarking on a period of close conciliation which may eventually result in union.
But I did not rise to make any remarks upon the principles of Establishment. I rose because the noble Earl in charge of the Bill made a personal reference to me in his speech in moving the Second Reading. The noble Earl called the attention of the House to the fact that in 1886 I, as a member of the

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House of Commons, moved an Amendment to a Resolution then brought forward, and he informed the House that I carried my Amendment with the aid of the votes of the Conservative Party, and that this Amendment made two affirmations—first, that the National Establishment had failed to fulfil its expressed object as a means of promoting the religious interests of the Welsh people, and, secondly, that the time had come for reforming the National Establishment without delay in such a way as would enable it to adapt itself more efficiently to the religious needs and wishes of the Welsh people. The noble Earl pointed out that in his opinion no reform had taken place in the National Establishment in Wales since 1886, and therefore he came to the dismal and gloomy conclusion that dissolution of the Establishment was called for. I wish to correct the noble Earl on this question of reform.
In considering reform in relation to an organisation like the National Establishment one has to bear in mind, not only the machinery of the Establishment, but the spirit of the Church and the personnel of the clergy. I admit that the reforms which I called for in the House of Commons in 1886 in the machinery of the Church have not been passed. It seemed to me then, and it seems to me now, that it is a great cause of weakness and injury to the Church that any owner of an advowson should be able to present any ordained Churchman to a benefice however ill-adapted he may be to the parish to which he is appointed; and it seemed to me then, as it seems to me now, to be a cause of great injury and weakness to the Church that a clergyman appointed to the cure of souls should be able to defy the joint wishes of his Bishop and his parishioners. I pointed out in 1886 how certain reforms which might reduce the present autocracy of the beneficed clergyman and bring him under the joint authority of his Bishop and his parish would be a means of making the Church a more efficient instrument for promoting the religious needs of the people. But I ask the noble Earl to consider has not real reform of the Church been brought about during the last quarter of a century? In 1886 no one had a good word to say for the Church of England in Wales. Now no one has a bad word to say for it. In 1886 it was regarded as an alien Church.
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I think the Prime Minister, Mr. Asquith, in introducing his Bill even in 1894, described the Church of England in Wales as an alien Church. Now nobody describes the Church as the Church of England in Wales. It is regarded in Wales as the Church of the Welsh. It is no longer an alien Church, but the Church of the people. And why? Because of the better appointments that have been made.
The right rev. Prelate the Bishop of St. Albans pointed out that the State is very much to blame for the Nonconformity that exists in Wales to-day. Mr. Gladstone made the same remark in 1870. He pointed out that the rise of Nonconformity in Wales had been a direct result of bad ecclesiastical appointments. He pointed out that in the time of the Tudors and the Stuarts Welsh-speaking Bishops were invariably appointed to the Welsh Sees, and he made the statement—which I have not verified, but coming from Mr. Gladstone I do not think a better reference is needed—that forty-four Welsh Bishops had been appointed to the four Welsh Sees between the time of Henry VIII and the Revolution, and that in the time of the Tudors and the Stuarts not only were Welsh-speaking men appointed to the Welsh Sees but men of Welsh descent overflowed into England and were appointed, to the great advantage of Englishmen, to some of the higher places in the Church in England. At that time Puritanism had its stronghold in England, but had not even a foothold in Wales. What happened? William III decided to Anglicise the Welsh people by appointing English-speaking Bishops. Was there ever so fatal a step taken? Between the Revolution and 1870, when Mr. Gladstone was speaking, only two Welsh-speaking Bishops were appointed to the four 'Welsh Sees. Is it any wonder that the Church lost its hold upon the confidence and affections of the people? When they were taught that England regarded the Welsh Bishoprics as a means for killing their language, when the Welsh people were taught that we regarded the Church as an instrument for their special conquest, can we be surprised that five-sixths of the people lost their allegiance to the National Establishment? I am only surprised that a still greater proportion did not revolt from it.
What has happened since 1870? Mr. Gladstone appointed the first Welsh-speaking Bishop, Bishop Hughes, to the diocese of St. Asaph in 1874. In the first year of

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his Bishopric the number of Church communicants in the diocese was 7,000. What was the number of communicants in that diocese last year? It was 30,000. In that rise from 7,000 in 1874 to 30,000 in 1912 you may see what the result is of giving the Welsh people a clergy and Prelates who understand how to offer the ministrations of religion in consonance with their own feelings. Now, if we wanted a really effective illustration of the various, reforms that have been made by the Church in the National Establishment in Wales since that Resolution was passed to which the noble Earl called the attention of the House, it is in the speeches which have been made by the right rev. Prelates who have come to us from Wales. Speeches such as those of the Bishop of St. Asaph and the Bishop of St. Davids make us realise that we have only to continue a little longer to secure that the people of Wales will come in to the Church in increasing numbers and into new allegiance to the Church of England.
I will conclude with this one remark. I do not want at this hour in the evening to embark upon a controversial speech as to the theory and principles of the Establishment, but I have been taught the old Whig doctrine that the National Establishment is not an institution of divine origin or with divine authority, but is a purely human institution whose mission it is to offer the ministrations of religion to the people under conditions approved and altered from time to time by Parliament. That is a big subject and I cannot embark upon it, but I say if that theory of the Establishment is correct, how dare yon, a so-called Liberal Government, take away from the people their national inheritance? You are now the trustees to see that the endowments bequeathed by successive generations of our forefathers fur offering ministrations to the people shall be administered in a right way, and I say you are faithless and false trustees if, simply to mutilate and to injure and to hurt the Anglican Church by taking away some of its revenues, you abandon all future control over these endowments which, when the day comes which the noble Marquess has foreshadowed when we are a united Protestant Church, will be controlled, by the common consent of all concerned, by the Parliament of this Kingdom in a way which will conduce most efficiently to the spiritual well-being of the people.
LORD GLANUSK: My Lords, as a Welshman and a Churchman I rise to support the Motion for the rejection of this Bill. I do so with some hesitation, first, because this is the first time I have addressed your Lordships' House, and, secondly, because when the Church to which one belongs is threatened with spoliation and robbery one is apt to say too much and to say what one might regret a moment or two afterwards having said. I am what I suppose would be called a "backwoodsman"—that is to say, I do not often attend the debates in your Lordships' House. I do not know anything about Parliamentary procedure, nor am I a politician. I am here to support my Church to the best of my ability, and have not missed, I think, a single word that has been said during this solemn and serious debate. But I cannot help saying that I was surprised and almost horrified to see noble Lords opposite during the discussion of what was going to happen to the poor curates in Wales smiling, and to see Members of the other House at the Bar and in the Galleries laughing heartily even during the most solemn sentences of some of our most eminent divines, and to hear the noble Earl who opened the debate so manipulate his figures that the House was deceived, or might have been deceived, to the extent of possibly something like £100,000. If this is politics, I am glad I am not a politician.
I was also astonished to hear Bishops of our own Church supporting this mean and unjust Bill, apparently forgetting, I suppose, that they themselves had keen in the same position of the said urates at one time or other. It makes one think that possibly Disestablishment after all may have this advantage to us in Wales, that we should then be able to elect our own Bishops and to take care to elect men who would support and do their best for their Church in its evil times. I do not think chat the Government have realised the strength of feeling there is against this Bill in Wales, and especially in South Wales. I do not think they realise that Churchmen are smarting under a sense of gross injustice such as, I imagine, the loyalists in Ulster are feeling at the present moment. The passing of this Bill is hound to cause friction. In these days all subscriptions have to he cut down on account of recent legislation and all charitable institutions are feeling the

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effect of that recent legislation in the way of reduced subscriptions, and when we have to make good the deficiency which has been caused to us it is not in human nature to suppose that we shall allow our own people to be the first to suffer. Therefore this Bill is bound to cause friction.
Disestablishment has been already fully described, so I will only say one word on the Disendowment part of the Bill. No noble Lord on the other side has yet justified Disendowment in any way whatever. The noble Lord, Lord St. Davids, rather suggested that it should be done according to a calculation of the numbers of Churchmen and Nonconformists, as I understood him, but no one has given any justification for it. If it is right and justifiable, why not take the whole amount? If it is not justifiable, why not leave it all? It is difficult to understand how anybody who calls himself a Christian or an Englishman can possibly be found to support this Bill—as a Christian on account of the doctrine of brotherly love which we all profess, and as an Englishman on account of that love of fair-play of which we are all so proud. There is neither one nor the other in this Bill, neither justice nor fair-play. The argument that Disendowment is for the good of the Church is a childish argument, and one that it is hardly worth discussing. You might just as well say that it would be for the good of the Ministers of the present Government if you took away their salaries. I do not know that they would be inclined to think that that was very much to their advantage.
We feel very strongly on the point in South Wales. We feel that you are crippling the Church without doing anybody else any good whatever. Not a single individual in the Principality benefits under this Bill. The ministers of religion do not get anything, the chapels do not get anything, and the rates do not get anything. The only people who do benefit are those who will join the ever increasing crowd of officials, the Commissioners of the Welsh Church, who come into being under the Bill. Therefore why cripple the Church, a Church which is admitted to be doing so much good? I hope your Lordships will not hesitate as to the course you should pursue with regard to this Bill. I venture to think that if there had not been a Second Chamber this Bill would never have passed the First, and that if it does not pass your Lordships' House
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this evening we shall hear no more of it and that it will pass into that oblivion to which we hope its authors may soon follow it.
[The sitting was suspended shortly before eight, and resumed at nine o'clock.]
VISCOUNT PEEL: My Lords, the right rev. Prelate the Bishop of Oxford told us that one of the things he regretted most in this debate was that the case for the Church in Wales had rested rather too much on the question of Endowment, and not so much on the question of Disestablishment, but I confess that I have not seen signs in the course of this debate of too much weight being attached to the question of endowments. That may be a very proper criticism from members of the Episcopal Bench, but I think laymen like myself, and especially a member of a Church associated so closely with the Church of England as the Church in Wales, may take rather a freer view of the subject. But I did note that, although the right rev. Prelate dealt so forcibly upon this point, he himself was not satisfied with the provisions of the Bill, and though I think he agreed to its provisions with regard to tithe, he nevertheless lamented that the Government had refused to accede to the Amendment moved in the House of Commons with regard to glebe.
Now I confess to being a whole-hearted supporter of endowments. One has seen too much of the system by which voluntary Churches attempt to get their supplies. The difficulty is this, that precisely at the time when funds are most required and when Church interest is most slack and indifferent, it is most difficult to get the funds by which the Church work can be carried on. The great benefit of endowments is that they serve to tide over those periods of indifference, and to carry on the Church to more happy and more energetic spiritual times. Moreover, if we may take a lesson from Nonconformists, we find the opinion of Nonconformists has wholly altered in this respect. One can hardly take up one's newspaper on any day without seeing that they themselves are impressed by the difficulties of their purely voluntary system, and are determined to safeguard not only their work but their position by endowments. They argue in this way; but when the case comes home to them they seem to take a very different view.

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I was in Scotland during the great controversies which attended the union of the independent Churches in Scotland, resulting in the United Free Church. I was at that time in one of those small villages in Ross-shire which took a different view of that question from the rest of the United Free Church. It will be remembered that by the Courts in Scotland the whole of the property was adjudged to the United Free Church, but that decision was reversed when it came to the House of Lords. In that little village where I was at the time they took a very vigorous view, a very muscular Christian view—shall I say?—of the position, for they seized the Church, and they seized the manse and drove the United Free clergyman from it, and at that time the noble Earl, Lord Halsbury, if he had come to that village would have been received with almost divine honours. That is a very good example of the way in which Scotsmen look upon the case for endowments. The remarkable thing, too, about this argument for episcopal poverty is that it is preached by many of those whose own lives are examples of exactly the opposite state of things. I have heard it preached by some of those whose private income I should imagine was considerably in excess of the whole income of the Church in Wales. Even if you go back to historical instances, I do not think, taking even the time of Henry VIII, that he did worse in despoiling the monasteries and nunneries and driving the inhabitants out.
This argument has not been heard very much in your Lordships' House, but it is one which has been used on platforms and in other circles where the real force behind this Bill comes from. We are told that this measure is proposed for the benefit of the Church, that it is done out of loving kindness for the Church. If that is so, why should both these measures of Disestablishment and Disendowment be brought on together An Instruction was moved in the house of Commons, and a very valuable one it would have been if effect had been given to it, to the effect that the Bill was to be separated into two parts, and that the question of Disestablishment was to be taken in one Bill and the question of Disendowment in another. Had that been done I think the question might have been far more fairly argued, because as it is you have at one and the same time cast upon the Church the whole
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duty of reconstituting its entire organisation, and, in addition, of dealing with its organisation at a time when the Church has laid upon it the far more material duty of trying to collect fresh funds. I am bound to say that the Government when they are dealing with questions of Constitutional reform go by a more deliberate method of procedure.
I shall be interested to hear from the noble Marquess who will wind up the debate to-night what is the real basis on which this—shall I call it?—spoliation of the Church proceeds? If you look into the old Liberal records you find that the theory was that you could not have a great power within the State. If you took away the Church from the State and its guardianship from the State, you were also bound to diminish its property, because otherwise its power would be too great. That argument, of course, has died a natural death with the growth of great populations, and it seems almost ludicrous even to mention it in the case of a Church so poorly endowed as is the Church in Wales. The Government have shifted their ground in a remarkable way during the course of these discussions, and I am sure that the plethora of their arguments does more credit to the versatility of their minds than to the permanence of their convictions.
Take, first of all, tithe. We are told that the tithe is the gift of the State. The whole of the learning of history is against the Government on this point; yet they proceed in their argument in that way. I imagine that, to mention one name alone, on the question of ecclesiastical history the authority of the late Bishop Stubbs is nearly equal to that of Mr. McKenna, and, it that is so, that argument cannot apply to the glebe, which no one has ever pretended was anything but a private gift. I assert that during the whole of this controversy even the utmost malice of hostile research has been utterly unable to find any argument to support the theory on which this Bill was launched before the House of Commons. Then they refer to the wishes of the donor. I think it is a little difficult to speculate on what could have been the motives of some medieval donors, but I am convinced of this, that if a mediaeval donor had heard that the Nonconformists were about he would have not only made these gifts but

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would have stripped himself of even more and given all the silver that he had in his coffers. Then we are told—and I think the historian on this occasion is the Chancellor of the Exchequer—in defiance of all authority, that an entirely different Church was set up and established at the Reformation; but, if that were so, taking them on that ground, surely the prescription of 300 years is enough to establish the property in the hands of the Church. But we are told that is not so, and yet twenty-five years is said to be sufficient to secure the property in Nonconformist chapels. Twenty-five years is enough in the case of Nonconformist chapels, but 300 years is not sufficient in the case of the Church!
Then take another argument—the question of the tripartite division of property as applied to the property of the Church. It is argued that only one-third of this endowment property ought to go to the ministers of religion, and that the Church has long since ceased to be the sole authority by which the poor are benefited in this country, and, in fact, that the county councils have now taken the place of the Church as dispensers of benevolence. That has been absolutely disproved as regards parochial endowments, however much it may apply to the endowments to monasteries. The most rev. Primate the Archbishop of Canterbury has commented, and I will not say a word about it, on what I think he described as the "jugglery in the Ministerial finance." Perhaps I may say a word in extenuation of the action of the Government, because I imagine that the confusion of their arithmetic is due to the fact that they have been so busily occupied lately in condoning their own financial irregularities. I very much regret that, in spite of several offers, Nonconformists have refused to accept the principle of concurrent endowment. They assert that it is contrary to their principles. It is curious how often men are apt to mistake the feelings of the moment for eternal principles. That has not been always their view. In the case of the Presbyterians, we know that they were endowed in Ireland; you may even argue, I think, that there was a heavy endowment in regard to religious education in the country, no doubt in regard to a form of religion which was certainly more acceptable to Nonconformists than to any other set of men. Then, in addition,
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Nonconformists have not to pay rates on chapels, and surely the remission of rates on their chapels is quite the same thing as taking an endowment from the State.
We are told that we have a majority in the House of Commons against us. Now, my Lords, I have seen nearly too much of the way in which those majorities are cemented and compacted together to have any respect for them. If you take mere majorities I admit as regards the House of Commons that the question may be said to be settled. But if you apply yourselves to getting together a general argument for the taking away of these endowments what is the result? It is said that the endowments are excessive. First of all, are they excessive? No one has ever argued in this House or in the House of Commons that they are. Then are these endowments misused? No one would contend that for a moment. Everybody admits—the Prime Minister has handsomely admitted it—the splendid work that has been done for the last seventy years, the date he gave, by the Church in Wales. In fact, so far as I have heard, the attacks on the Church both here and in the House of Commons have practically concentrated on a certain slackness in the eighteenth century. The Church in Wales has had a very hard measure meted out to her. First of all, before the Reformation it was very largely a Church endowed in connection with monasteries, and therefore at the dissolution of the monasteries it suffered more than did the more parochially endowed Church in this country; and again, when it had recovered from the blow inflicted at that time, the Church in Wales suffered most severely at the hands of Cromwell. After this double blow, and when it was suffering from this loss of endowments, was it likely that the Church could display great activity? Moreover, everybody knows, of course, that during the eighteenth century there was a general decadence of religious feeling not only in Wales but in England and other parts of Europe. What is the charge that is brought against the Church in the eighteenth century? That the Whig Government had made some bad appointments to the Bishoprics in Wales. Surely that condition of things reflected more discredit on the Whig Government than on the unfortunate Church in Wales which suffered under it.

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We have heard much in these debates of the Welsh nationality question, but it does not seem to me that, however much you admit Welsh nationality, you admit the claim of Welshmen to this Bill. If Wales is still part of the United Kingdom you cannot pretend that you must take Welsh opinion alone in order to settle these matters. If, on the other hand, you project yourselves into some remote future and imagine that Wales is going to have its own Parliament, there again I contend that the claim for this Bill cannot be put forward. It is a matter of the kind called in the United States inter-State matters, in regard to which the opinion of one State is not able to outweigh the opinions of others. I need hardly cite authority to prove the fact that an absolute historic unity exists between the Church in England and the Church in Wales, and the so-called advantages of piecemeal Disestablishment in Wales cannot be an argument for severing the Church there from the life of the Church in England itself. Indeed, my Lords, if one takes rather a long view of the matter, I cannot help thinking at this moment that it is very inopportune to bring forward a measure involving so tremendous a change, and certainly, so far as one can judge, there is a general feeling of weariness growing up at the constant splitting up into sects which has been the result of the breaking away from the Church of England. The tendency is rather to grow disgusted at what Matthew Arnold called "the dissidence of Dissent," and the tendency is all towards greater union. And when one talks about greater union and greater organisation one turns naturally to the Church which is the symbol in this country at least of greater union.
The right rev. Prelate the Bishop of Oxford said he thought that the drifting was rather, not back to the Church of England, but away from all Churches. Certainly in my small experience I have met numbers of ministers of religion who have told me that they have received into the Church of England a considerable number of Nonconformists, and when I have asked them the reason they have generally said this, that the Nonconformist ministers find it very often difficult to distinguish between religious activities and political activities. I remember there was a famous preacher at Oxford of whom it was Fail that in his sermons you would find
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no trace of either religion or theology. Well, I do not think the warmest admirer of the Nonconformists could say that in many of their sermons at least you could find no trace of politics. I am aware that we are promised freedom for the Church of England in the case of Welsh Disestablishment. The forms of freedom, we are told, alter in every age, and one of the signs and marks of this freedom is that the representatives of the Church in Wales are not to be allowed to go to Convocation. Surely that is rather a limited and prohibitive kind of freedom. And, after all, who are those who object to the Church in Wales? Who are those who offer this freedom? I have sat on Committees and in the House of Commons when measures for the benefit of the Church were promoted by Churchmen, and they were all obstructed and fought most bitterly by the very men who now conic forward and use this argument to try and press freedom on a Church that does not ask for it.
The greatest glory and honour of the Church during all these centuries has been the parochial system. What a blow is struck at it by this Disestablishment Bill ! I think we should note that Mr. McKenna, in speaking on the Third Reading of this Bill in the House of Commons, practically said that if only he had the power he would not only disestablish the Church in Wales but would disestablish the Church in England as well. I should like to know whether the noble Earl opposite shares that view of Mr. McKenna's. The right rev. Prelate the Bishop of Oxford told us that there was slackness and indifference. But surely it is a great thing that in every parish, even for the slack and the indifferent in moments of sickness or sorrow, there is one man at least to whom they can go for consolation and sympathy; and it is a great thing also that we should be able to secure for the clergyman in a parish that independence which he never can secure if he has to depend wholly and entirely on the results of the voluntary system. The truth is that the whole of this measure, as regards the separation of the Church and State, depends upon a very antiquated Liberal theory, and surely the present day, when the State is penetrating more than ever and more deeply into the life of the people than it has ever done hitherto, can hardly be a time to undertake the separation of Church and State in matters religious and matters spiritual. In a

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democratic age, when more than ever we are considering material questions and the necessity of healing material wrongs, it is increasingly important that there should be some historical institution that would appeal to the heart and to the imagination and to the spiritual side of man.
My Lords, you must not rely on any amendment of this measure. I think those who saw how in the House of Commons any small concessions given by the Government were received by the Welsh Members will recognise that there is no hope that if this Bill were sent back to the House of Commons our Amendments would be accepted. There would be a revolt, among the Welsh Members. And if any one rests his hope on later amendment of this Bill, let him remember the Parliament Act, that quaint instrument of Government which prevents anything of that kind being done, and forbids any alteration even in a date or a comma being made in the measure. I do not suppose that the Government would be so rash as to insert Amendments at a later stage which would give this House the chance of throwing out the Bill altogether. This property that you are attempting to take from the Church is trust property, property that you have no right to take. We hear much of the omnipotence of Parliament. Fortunately the omnipotence of this Parliament is limited by the omnipotence of the next Parliament, and if injustice is done by this Parliament we must look, and look only, to a subsequent Parliament to redress that wrong.
THE MARQUESS OF LANSDOWNE: My Lords, I shall trespass for only a few moments upon your Lordships' attention, and indeed but for my desire to make something in the nature of a profession of faith before this debate closes it would not be necessary for me to intrude upon your time at all. The case against this Bill has, in our view, been already stated with sufficient force. It has been stated, not only from the Benches behind me, but from the Episcopal Bench opposite with an overwhelming weight of authority, with much wealth of illustration, and with a force of argument which I do not remember ever having heard equalled in debates in your Lordships' House. I do not know that we, at all events, shall be disposed to admit that the case for the Bill has been argued with equal success. The noble Marquess who leads the House will be
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on his legs at midnight if he attempts to meet the mass of arguments that has been directed against the Bill for which he and his colleagues are responsible.
Let me say one or two words as to the course of this debate. I have been a member of this House for a great many years. The noble Earl in charge of the Bill reminded me on Tuesday—rather unkindly, I think—that forty-four years ago I recorded a vote in this House in connection with a Bill for disestablishing and disendowing the Irish Church. I shall have a word to say upon that analogy in a moment. But, my Lords, in all those long years I can recall no case of what we sometimes speak of as a full-dress debate in which the Government responsible for the measure before the House has taken such slight pains to justify it to your Lordships. At the opening of the debate we had the speech of the Cabinet Minister who is responsible for the conduct of the measure. Since then we have had speeches—memorable speeches, I venture to think—from the two most rev. Primates and from the two right, rev. Prelates who preside over the dioceses of St. Asaph and St. Davids. We have had, besides those, five speeches from this side of the House from Peers of Cabinet rank. During the course of those speeches we have been able to show that the "facts" adduced by the advocates of the Bill were anything but accurate; that the figures employed were figures which no respectable firm of chartered accountants would have allowed to pass muster; and that the history adduced in support of the arguments has been, to put it mildly, of a most unhistorical description. I am almost inclined to borrow a phrase that fell from ! the right rev. Prelate the Bishop of Oxford, when he told us that on certain points the ! supporters of the Bill had been left, if not dead, at any rate unhorsed or seriously wounded upon the field of battle.
In spite of that long array of speeches not even a solitary Lord-in-Waiting has been put up to give us an idea of the manner in which the official members opposite regard the arguments of my noble friends upon this side of the House. When I say that, I do not for a moment leave out of sight that speeches, able speeches, in support of the Bill were delivered from the Back Benches opposite and by two at any rate of the right rev. Prelates. But we may be permitted to

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notice, in passing, that most of those speeches were, so far as many important provisions of the Bill are concerned, by no means wholehearted in support of the measure. I take in particular the extremely interesting and telling speech delivered by the Bishop of Oxford. I should like to ask the House, supposing the Bill upon the Table were to be handed over to that right rev. Prelate for reconstruction, what kind of a Bill would emerge after it had undergone reconstruction at his hands? Would the parents of the measure recognise their offspring? Would the reconstructed Bill stand a ghost of a chance of being even looked at by the Radical Party in the House of Commons?
In spite of all that, up to the present moment the noble Earl opposite has been the only Ministerial supporter of the Bill upon the Table. I dwell upon that, and I think I have a right to, because this is a fair example of the way in which the House is being treated under the new dispensation. We were told when the Parliament Act was under discussion that we should at any rate have the fullest and freest opportunities of discussing and suggesting revision of Government measures; but it has come to this—that in one of the Houses of Parliament that freedom of discussion is limited by the guillotine, and in the other by something which can only be described as very like a boycott on the part of the Bench opposite.
Let me turn for one moment to the observation that was made by the noble Earl in charge of the Bill as to the vote which I gave on the Irish Church Act in 1869, and may I be permitted to suggest to the noble Earl that when he has been as long in public life as I have he will find that he is quite indifferent to any criticisms which are made upon votes which he has given or things which he has said in his salad days. But whether my vote in 1869 was a wise or a foolish vote—I may say, in passing, that it was given in very good company, and that, as far as I am able to judge retrospectively, I should give the same vote again—there is no inconsistency between the vote which I gave in 1869 and the vote which I hope to give this evening at the conclusion of this debate. Most of the reasons have already been
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touched upon in the course of this discussion, and I will only enumerate them quite shortly. In 1869 we were dealing with a Church which was a distinct Church with a separate organisation of its own—a Church which had been joined to Ole Church of England within the memory of people alive at the time of the introduction of the Bill; in this case we are dealing with a Church which from time immemorial has been an integral part of the Church of England. Again, in 1869 we were confronted with a unanimous demand from the Roman Catholic population of Ireland, numbering, roughly speaking, about four-fifths of the whole population and solid in its opposition to the Established Church. In the year 1913 we have a demand made on behalf of a Nonconformist population which numbers, I believe, something less than one-half of the total population of the Principality, which is not a solid body and which represents not one religious denomination, but, I think, altogether something like four. Thirdly, in 1869 we were dealing with a Church which was, as Churches go, a wealthy Church and which had at any rate a certain abundance of means. To-day you are asked to deal with a Church which is notoriously a very poor Church, and which wants every farthing of which it can dispose. And I think I might almost add that there is this further difference, that in 1869 we had before us a great and bold scheme of Irish policy outlined by the master-hand of Mr. Gladstone, which had been fully thought out and fully unfolded to the country. In this year we are offered what I can only describe as a very paltry measure designed for the purpose of keeping quiet a turbulent section of the supporters of His Majesty's Government.
I have one further criticism to make upon the noble Earl's references to the case of the Irish Church. He told us in the course of his speech that when the Irish Church Act was passed there were 467 curates in existence, and that these, by the time the Act had come into operation, had sprung to a figure of no less than 918. Of course the suggestion was that there had been a wholesale creation of curates for the purpose of obtaining the financial advantages of the Act. I have ascertained that on this point also the noble Earl has been incorrectly informed. The correct figures are these. There were, not 467, but 720

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curates serving prior to the passing of the Irish Church Act and 921 a year or two after its passage, so that there is only a balance of 201 to be accounted for, and I am informed that of that 201 the great part can be explained by the normal appointment of curates, taking the average number of such appointments made from year to year.
I apologise for detaining the House with these apparently trivial matters: what your Lordships have to consider this evening is not the question of the abstract merits or demerits of a Church Establishment. Nor have you to consider whether in the case of the Church of England it is a good thing that there should be a connection between Church and State. What your Lordships are asked to consider this evening is whether it is right or wrong to sever from the Church of England a fragment of that Church and to despoil it of the endowments which it has so long enjoyed. I take it that the feeling in most of our minds is a desire to protest against this fragmentary treatment of so great a question. Wales is geographically, politically, and ecclesiastically part of this country. The Welsh dioceses stand in no different position from the other dioceses of the Church of England, and it is worth remembering in this connection that just as the Church in Wales is indistinguishable from the Church in England, so the Nonconformist denominations of Wales are indistinguishable from those denominations on the other side of the border. It is on record in the Report of the Royal Commission that not one denomination in Wales pays any regard to the boundary line between England and Wales. Therefore, my Lords, we hold that this question concerns not merely Wales but the State as a whole, and that it should be dealt with from that point of view; and therefore we remain unmoved by the statement so often reiterated that this Bill is desired by the people of Wales.
I hope that nothing that I shall say or that I have said about Welsh or Irish nationality will be interpreted as indicating that I have any want of respect for what I might call local sentiment in any part of the country. The right rev. Prelate the Bishop of Hereford told us last night that the Welsh people had, I think he said, a character, a temperament, a sentiment of their own, and
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that they had their own poetry and their own language. All these are to my mind peculiarities deserving of every possible encouragement. I attach importance to them because they seem to me to make for a kind of intensified patriotism which is a good thing from a public point of view. There are a great many people who are sound patriots but for whom patriotism in the larger sense is something too vague and remote, and whose feelings are much more moved when that patriotism comes to be applied to a smaller area, their own country, their own province, even, it may be, their own parish. But while we admit all this we cannot allow these local sentiments to prevail when the question at issue is not merely a local question, not merely a municipal question, but a great question of policy involving the relations of Church and State.
The noble Earl asked me the other evening why I was so tender hearted in the case of Ulster, and so hard-hearted in the case of Wales. That was, I think, in effect his argument. Well, there is an analogy between the case of Ulster and the case of the Church in Wales, but it is not the analogy that the noble Earl supposes. The real analogy is this. Ulster desires to remain inside the Union; you desire to drive her out; we desire that she should remain where she is. The Church in Wales desires to remain in the English fold; you desire to drive her out, to cut her off from the parent Church; we desire that she should remain where she is now. I ask noble Lords to remember where this, I was going to say, mania for allowing purely local sentiment to prevail is going to lead them. You are committed up to the hilt to some scheme of devolution for the British Isles, perhaps for the British Empire. We do not know what it is. I doubt very much whether you yourselves know what it is. But unless your language is absolutely insincere you have been thinking about this for a long time, and you propose eventually to give effect to your ideas. Now, the question that I want to ask is whether, when those ideas are realised, when you have brought into existence your heptarchy, you then propose that the question of the connection of Church and State should be left to the decision of each member of that heptarchy. That seems to me, my Lords, to be an unthinkable proposition. Supposing Mr. Winston Churchill's plan to be carried out, are you going to have an Established.

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Church in Lancashire and no Church Establishment in Yorkshire? Could anything be more preposterous? And remember—the argument has been used already—that in your own Irish Bill you have expressly reserved the question of the Establishment of a Church as a question which is not to be dealt with by the local Legislature but is reserved for higher authority. This, at any rate, we may affirm with confidence, that the burden of proof lies upon those who desire to sever this ancient connection and to confiscate benefits which have been bestowed upon the Church by pious men on the faith of that connection.
What then is the first question that has to be answered? Is it not this—and perhaps When the noble Marquess replies he will give me the answer—Who is injured by the Establishment of the Church in Wales? Can any one say that any man, woman, or child receives any practical wrong or is caused any substantial inconvenience from the fact that the Church in Wales is connected with the State? I am, I must own, sometimes moved to indignation when I read the kind of language that is used by friends of noble Lords opposite in regard to this question—language like this for example, that "the system of Establishment has been a curse to the land of Wales." My Lords, what a ridiculous and exaggerated statement! What are the incidents of Church Establishment? Let me take one or two of them. The Sovereign is the head of the Church. Not long ago His Majesty the King visited Wales for the purpose of the Investiture of tire Prince of Wales at Carnarvon Castle. Those who were present on that occasion described the ceremony as one of the most moving they had ever witnessed. It was in part a religious ceremony. The ritual was, I believe, settled by the most rev. Primate in consultation with the heads of the Nonconformist Churches in Wales. That consultation would not have been possible if there had not been an Established Church to form a kind of nucleus for that purpose. From all I have heard I gather that upon that occasion there was an almost passionate display of loyalty on the part not only of the Churchmen of Wales but of the Non-.conformists of Wales, and I totally disbelieve that the connection of the Sovereign with the Church in any way injures the feeling of anybody in the Principality.
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Another incident of the Establishment is the presence of the Welsh Bishops in this House. As to that I will only say this, that if I were a Welshman I should be proud to have my country represented in one of the two Houses of Parliament by such men as the two right rev. Prelates who have addressed us as the representatives of Wales on this Bill. Then another incident of Establishment is the power of Parliament to deal by legislation with the affairs of the Church. That is not a grievance that hurts the Nonconformists. If any one has cause to complain of that, it is the members of the Church in Wales. I take yet another incident of Establishment—the connection of the Church with Convocation. The Bishop of Oxford announced his intention of, I think he said, waging unrelenting was against the proposal to cut off the Church in Wales from Convocation. And, my Lords, note this, that if you are going to cut off, as you will by this Bill, the Church in Wales from Convocation, you are placing the Church in an infinitely worse position than that which is occupied by the Nonconformist Churches in Wales, because they are free to organise themselves and to combine with their brethren on the other side of the border. It is the Church in Wales alone which you are going to cut off from the parent body.
Upon this question of the alleged grievance of Establishment, a very pertinent observation was made last night by my noble friend Lord Dynevor. He called the attention of the House to the fact that under this Bill a new kind of Establishment is to take place. A new Welsh Church will arise from the ruins of the old one. It is to have a statutory constitution, it is to have a charter, and it will retain its cathedrals. Are you quite sure that, with all those things left to it, the Church in Wales will no longer be held up to obloquy as a privileged body differing from the humbler religious bodies that surround it? I do not believe that the feeling, such as it is, which exists against the Established Church in Wales is due to any of these things. If it exists at all, it is, I think, much more due to the causes mentioned by my noble friend Lord St. Aldwyn last night, to a certain personal estrangement between the incumbents of the Church of England and those who live in their neighbourhood. I think it highly probable that such a feeling of aloofness, or call it exclusiveness if you prefer, does exist in certain parts of

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the Principality. But we have this consolation, at any rate, that we know that with every year that passes Churchmen and Nonconformists are drawing more closely together, and we believe that if they are only encouraged in that direction that estrangement will in time become a thing of the past. At any rate, my Lords, we may say without fear of contradiction that the Welsh Church as we know it to-day is not only the most ancient institution in the land, but it is the largest; Church in the Principality of Wales and there is no charge of inefficiency against it. The old indictment, based upon an alleged neglect of opportunities during the seventeenth century, is heard no longer. We have the testimony of Minister after Minister to the effect that the Church is not only doing its duty but is doing it admirably in Wales. There is no Welsh parish without a Church of England place of worship and a Church of England minister. There are 210 parishes in which the Church is the only place of worship; and there is this also in evidence, that it is the Church of England which takes most of the hardest and roughest work that is done in that part of the United Kingdom. We find the Church in the remotest glens and in the slums of the great cities doing its duty and doing it with increasing success. On what ground, then, is this sentence to be passed upon the Church in Wales?
I come now to the question of Disendowment. When you come to Disendowment you are dealing with a question, not of sentiment, but of fair play and of common justice. There is an apparently hopeless confusion of thought about some of the questions connected with the endowments of the Church in Wales. The noble Lord who spoke second this evening, Lord Aberconway, repeated the old fallacy that the Welsh tithe was a tax on the Welsh farmers. The noble Lord could not have been in his place when my noble friend Lord St. Aldwyn dealt with this part of the case or he would have known that the tithe in Wales is not a tax upon the farmers; it is a charge upon the land in Wales, a charge subject to which the land in Wales has been transferred from one individual to another. If it was no longer paid by the farmer the farmer would have to pay more rent. If the owner of the land sells the land he sells it subject to the tithe; and if the tithe were done away with by a stroke of the pen to-morrow morning no benefit
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whatever would acme to the taxpayer of Wales. Of these proposals for Disendowment I would only say this, that I believe them to be cordially and universally disliked, and not least by a great many of those who are habitual supporters of His Majesty's Government.
As to the question of the loss which will fall upon the Church, I desire to say one word as to the kind of balance-sheet which has been laid upon the Table of your Lordships' House, and which professes to show what the financial position of the Welsh Church will be after these arrangements have been accomplished. There is a kind of Nemesis of inaccuracy in all the figures which are produced in connection with this subject. There is a glaring inaccuracy in the figures which appear on page 8, and I call the attention of the noble Marquess to it. He will find that amongst the assets which the Welsh Church is to enjoy after Disendowment there is mentioned £28,000, the grant of the Ecclesiastical Commissioners, and £3,000 granted by Queen Anne's Bounty. These are not new assets at all. These are assets which are already part of the property of the Welsh Church. It is true the money is not used as income, it is added to the capitalised endowment; but if this statement of accounts had been a fair one, those items would have been shown on both sides of the account. The suppression of them on one side is, I venture to think, a most extraordinarily misleading performance. The item, which follows, of £75,000 for interest on the capital sum paid for existing interests is, I am told, also an inaccurate item. The £75,000 represents a sum taken as interest at 3¾ per cent. on the £2,000,000 of commutation money. I am informed that the rate of interest of 3¾ per cent. is unduly high, and that the commutation money has been calculated on the basis of twelve and seven-tenths years' purchase of the secularised income—a number of years' purchase higher than that which the Home Secretary has ever offered in connection with the same transaction. The fact is that this deficit, which is shown as £51,000, should, if the account has been properly stated, have stood as £86,000. That is a specimen of the accuracy of the figures put forward by His Majesty's Government.
I will not dwell on the consequences of this spoliation to the Church itself. We are all familiar with the argument that this

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kind of misfortune is very often a blessing in disguise to the victims. From that point of view I suppose we may be told that the influenza, or the Super Tax, or the suffragettes, are blessings in disguise. I do not know that there are many of us who will hold that view. But I am quite sure that a badly paid Welsh clergyman will not think it a blessing in disguise when he finds that, although the funds which lie already enjoys have been reported by the Royal Commission as insufficient for the spiritual needs of the parish, yet in the case of about half the incumbencies the ministers will be left without any endowment at all, and that in 132 cases they will be left with less than £10 a year. The figures were given in great detail by the Bishop of St. Asaph, and those figures have not, as far as I am aware, yet been challenged by any one on behalf of His Majesty's Government. It seems to me extremely cruel to leave the Welsh Church with its cathedrals and other buildings and at the same time without any funds for their proper maintenance. I entirely agree with what has been said by some of my friends near me, that the whole result of these operations can only be to leave a lasting feeling of rancour and irritation in the minds both of the ministers who have been despoiled and of their flocks, who will suffer from that spoliation.
I will not detain your Lordships longer. This Bill raises enormous issues—the relation of Church and State; the sacredness of trusts; the value of prescriptive rights; and, perhaps, most important of all, the right of a local majority to usurp the functions of the State in regard to great questions of national principle. My Lords, the Bill deals with these questions, and it deals with them, I venture to think, upon the wrong lines. By rejecting this Bill your Lordships will at any rate give His Majesty's Government time to consider whether they are justified in forcing upon Parliament under the Parliament Act proposals as indefensible as these, supported by arguments as unsound as many of those which have been used in the course of this debate; proposals so little liked by many of their own friends and supporters; proposals, lastly, calculated to throw a serious obstacle across that better path which was indicated for us this evening by my noble friend Lord Salisbury.
THE LORD PRIVY SEAL AND SECRETARY OF STATE FOR INDIA (THE MARQUESS OF CREWE): My Lords, however different may be the views which in different parts of the House are held upon this Bill, we shall all, I think, agree with what the noble Marquess who has just sat down said in effect—namely, that this business has been approached throughout these three days with a high seriousnesss and a tone, I think without exception, worthy of this Assembly and of the subject debated. I can assure your Lordships that I fully feel the responsibility which rests upon me in rising to close a debate upon a subject such as this, which strikes so deeply into both the emotions and convictions of many on both sides of the House. The noble Marquess said that if I were to attempt to cover the whole of the ground, which he hinted we had somewhat in the course of the debate neglected to cover, I should keep the House here till past midnight. That is true, and I have no intention of attempting to cover the whole of the ground. Before I sit down, however, I shall endeavour to say a word on the subject of the complaint which the noble Marquess made of the manner in which we propose to deal with this measure under the Parliament Act. But I must remind him of this, that if there has been a failure on the part of His Majesty's Government, or those who lead it, to cover the whole of the ground in this debate on the Second Reading, that failure must have been and would have been corrected to a great extent if the noble Marquess opposite had thought fit to pursue the further stages of the Bill and to take it into Committee. The mere fact, as the noble Marquess complains, that some of the members of His Majesty's Household have not taken part in this debate does not, I think, afford a reasonable subject of comment or complaint for noble Lords opposite who are treating the whole measure in this somewhat cavalier way.
In the observations I shall make I propose to deal very shortly with the purely business or financial side of the Bill as expressed in the measure of Disendowment which the Bill inflicts upon the Church in Wales. Knowing the view which is held of His Majesty's Ministers, I must state that if I do not attempt to juggle with figures I will not ask noble Lords to believe that it is owing

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to any moral unwillingness to do so, but to a complete mathematical inefficiency which has pursued me all through life. It is beyond my competence to do anything of the kind. Various noble Lords—the noble Earl opposite, Lord Selborne, and also the noble Viscount, Lord St. Aldwyn, and one right rev. Prelate, the Bishop of St. Asaph—have dealt fully with these financial matters, and the noble Marquess who has just sat down once more accused us, if not of deliberate misstatement, at any rate of a confused method of presenting the figures which is liable to mislead. As I understand from the speeches of the various noble Lords, the charge against us is this, that we say we are depriving the Church in Wales of only between £50,000 and £60,000, whereas in reality we are taking away £158,000. Now, my Lords, neither of these statements is accurate. The Bill does not take away £158,000. What it does is this. It will diminish the revenues of the Church in Wales by that amount—noble Lords laugh, but they must kindly allow me to finish my sentence—it will diminish the revenues of the Church by that amount when all the present life interests are extinct. That is not the same thing as taking away £158,000. Neither is it the case that anybody ever said that all we are doing is depriving the Church of a sum of £50,000 odd of revenue. What we have said is that if a sustentation fund were formed from the time of the passing of the Bill, amounting to a payment of that sum of £50,000 odd a year, by the time all the life interests are extinct that annual sum will represent the whole diminution of the Church's income; and I think your Lordships will see that that is by no means the same thing as saying that all we are doing is to take away the sum of £50,000 odd a year from the Church.
Then the most rev. Primate the Archbishop of Canterbury dealt with another point which has also been touched upon by the noble Marquess who has just sat down, and that is with regard to the sum of £31,000 mentioned in what the noble Marquess not quite accurately described as the balance sheet on page 8 of this Paper which has been circulated to your Lordships. That is not a balance sheet in the sense that it describes what the funds belonging to the Church were before Disendowment and what they will be
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after. It is a statement of the assets and liabilities after Disendowment, which is, of course, altogether a different thing. The most rev. Primate said, "It is all very well to speak of this £31,000 a year as a further subvention from the Ecclesiastical Commissioners or from Queen Anne's Bounty; but how if at some further time, owing to unforeseen circumstances, things go badly with the funds of these corporations and they are not able, owing to the claims that they have to meet in England, to supply this £31,000 to Wales?" That would be, no doubt, a doleful possibility for the Church in Wales to look forward to. But surely exactly the same possibility exists if the Church remains Established. What would be the difference between the fate of the Established and that of the Disestablished Church, if for one reason or another, the Ecclesiastical Commissioners and Queen Anne's Bounty were unable to produce the whole sum? The noble Marquess accuses us of juggling in speaking of this £31,000 as a part of the assets of the Disendowed Church. Surely there is a substantial difference in fact in this, that that sum is now paid year by year by the authorities of the corporations in question to the Church in Wales, but they are obliged to invest it and can only spend the interest; whereas after the transaction named in the Bill has taken place it will be reasonable and prudent for the Church to use it as part of its regular income.
Then the noble Viscount, Lord St. Aldwyn, dealt with the subject of commutation in a manner which I am sure interested the whole House. Several speakers have appeared to argue that if commutation takes place it is not right to include the capitalised value of the sum commuted among the future assets of the Church, which is practically to say that, so far as the Church is concerned, it does not in the least matter whether commutation takes place or no. Anybody who looks into the experience of the Irish Church will see what an important difference it made in the arrangements of that Church, and, though to a less extent, it would do the same in Wales—that is, instead of the life interests being paid as they would be if there was no commutation, in precisely the same amount and to the same individuals as they are at present, things can be so worked that economies can be effected in the general administra-

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tion of the Church. The noble Viscount, whose authority on such a matter, of course, we all profoundly respect, seemed to hint that it was likely that the terms offered were such that it would not be wise for the Church to accept them, and he largely founded that statement on the fact that it was a 3½ per cent. basis which was offered by the Bill, and he went on, if I remember rightly, to say that if you were to take those terms to an actuary in the ordinary way of business he would say they were not good enough to accept.
VISCOUNT ST. ALDWYN: The opinions of actuaries may differ; but this may be said, that 3 per cent. is the rate which the Post Offiee—the Government, that is—calculated as the basis for Post Office annuities and for National Debt Commissioners' annuities.
THE MARQUESS OF CREWE: I was aware of that fact. The noble Viscount is himself, no doubt, aware that the reason for which the 3½ per cent. basis was named was that a special inquiry is to be made into the individual lives which it is believed will make the terms almost as good as if a 3 per cent. basis were taken on lives treated as a class. It is quite true, no doubt, that if you were to go to actuaries in the ordinary way of business and state those terms, some actuaries would say you ought to ask for a larger margin in respect of the possibility of a further fall in securities. That I quite admit and, of course, the point is an arguable one. But we consider that the terms offered are such as, with a reasonable forecast of the course of events, would not be unfair to those who would be affected by the commutation terms.
There is one other small point with which I want to deal before I leave this question of Disendowment. It was stated in the course of the debate—quoted, I think, from a statement issued by the right rev. Prelate the Bishop of St. Asaph in his diocese—that among the hard possibilities was the dismissal of curates at once. Of course, that is not strictly accurate. It is true, as the noble Marquess said by way of complaint, that we are not dealing with the interests of curates in precisely the same manner as that in which they were dealt with in the Irish Act. There the curates were taken as individuals, and their interests were dealt
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with separately. In this case the stipend of the curate is treated as part of the life interest of the incumbent—not so good terms, obviously, as the Irish terms, but terms which certainly do not make it fair or reasonable to say that on the passing of the Bill all curates will be unpaid and therefore have to be dismissed.
THE LORD BISHOP OF ST. ASAPH: The point is an important one, and I would ask the noble Marquess kindly to explain it. Do I understand him to say that the curate's salary is to be regarded as part of the incumbent's salary and to be added to it and regarded as a vested interest?
THE MARQUESS OF CREWE: Yes, that is so; it is to be regarded as part of the life interest of the vicar or the incumbent.
THE LORD BISHOP OF ST. ASAPH: That is to say that where an incumbent has a living of £200 a year and the curate a salary of £120, the vested interest will be regarded as £320 a year?
THE MARQUESS OF CREWE: Yes, in some circumstances.
THE LORD BISHOP OF ST. DAVIDS: This is an important point. Are we to understand that the noble Marquess says that when an incumbent has £200 a year and the curate's stipend is £120, the vested interest is £320 and not £80?
THE MARQUESS OF CREWE: I do not say that.
THE LORD BISHOP OF ST. DAVIDS: It is a very important point, and I should like to understand it.
THE MARQUESS OF CREWE: I can only promise to make further inquiry. I will now pass from curates, who, I can only once more assure the House, are not altogether left out, and I will say one word on the subject of tithe. That is a matter which in one sense stands half-way between the purely business aspect of the measure and those deeper matters of principle which have formed the subject of so much of the debate. I listened with interest to the noble Earl, Lord Selborne, who, as we all know, has an hereditary right to deal with this subject. I cannot help thinking that he adopted rather freely the dialectical

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device, one which is not unfamiliar to Parliamentary speakers, of treating as matters of certainty matters which are really dubious and in dispute. It is not possible to speak of these matters by going back into the dark recesses of history with the sort of sureness with which we should speak of the events of, say, one hundred years ago. The noble Earl quoted the opinion, for one, of his most distinguished father, who, it is only fair to remember, was a great Churchman as well as a great lawyer, and also the opinion of Dr. Freeman and of Dr. Stubbs. Of course, we admit the vast weight attaching to all these authorities; but I should like to ask the noble Earl whether he considers that it is an absolutely proved fact that there is no difference in the origin and purpose of tithe as between England and Wales, because, as a matter of fact, the arguments used by Dr. Stubbs and Dr. Freeman, and, I should conceive, also to a great extent by the noble Earl's father, largely apply to the origin of tithe in England, and it appears to be something of an assumption to say that there was no difference between the origin of that institution in Wales and that in England. At any rate, I think it is an arguable point, that there was a difference; and although I confess I am no student in these matters, yet it is stated that there is at any rate some evidence that the payment of tithe was not a universal practice in Wales, but that the duty of payment was confined in some cases to certain individuals.
But to come to the present day and to touch on the point mentioned by the noble Marquess, it cannot be disputed, so far as the feelings of those are concerned who pay tithe and do not belong to the Church in Wales—or the Church of Wales, whichever you care to call it—that they are contributing towards the support of a Church to which they do not belong. Their feelings, at any rate, are much the same as those which existed and were the subject not very long ago of inquiry in reference to Church rates, and which led to the abolition of that impost. And when the noble Marquess points out that it is in reality the landlord who pays the tithe, and that if the farmer did not pay it he would have to pay more rent—as a matter of fact, it is now actually paid by him—I cannot help asking him what is going to happen when the great mass of freeholders have been created, towards whose institution the
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noble Marquess and his friends are apparently going to supply hundreds of millions of public money? Those peasant proprietors will certainly find themselves paying the tithe, even on the showing of the noble Marquess, and it is not, I think, to be argued that if they are Nonconformists they will very much enjoy doing it.
I pass on to the more general arguments which have been advanced on the ground of principle. But, in the first place, I should like to say a word about the case of the disestablished Irish Church, upon which my noble friend who introduced the Bill has been made the subject of rather severe criticisms for quoting it as an analogy. It is, of course, true that the analogy is not a perfect one, and that the cases of the Church in Ireland and the Church in Wales are by no means identical. It is easy for anybody who compares the two to find plenty of differences between them, but what is apparent to anybody who reads about the debates of 1869 is the resemblance between the arguments used on both occasions. Unlike the noble Marquess opposite, I was not a member of this House at that time and therefore was unable to register my vote for the Bill, but I can remember having come as a school-boy and heard some of the debates, and I well recollect the imposing figure of the great Lord Derby of that day in the course of the debate. What is striking to anybody who glances through the debates of that time is the identity of the arguments used then with those which the opponents of this Bill use now. Phrases like "sacrilege" and "confiscation of religious property" were as frequent then as they are now. The Government of that day were told, as we are told now, that a new spirit of animosity was certain to be created in Ireland between the members of the Church of Ireland and the members of the other denominations.
I may say, in passing, that it is curious to observe that noble Lords opposite speak of that Act of Disestablishment as though it simply applied to the relief of the Roman Catholic body in Ireland, entirely forgetting their own friends of to-day, the Nonconformists in the North of Ireland, who were quite as much interested in the disestablishment of the Church as were the Roman Catholics. The Government of that day were told then,

1305
just as we are told now, that the secularisation of the Church surplus was a profane act which honest men, particularly if they were Christians, ought not to undertake. Yet noble Lords opposite, I think, took a considerable share in applying that gradually diminishing surplus to secular uses, as much as we did on this side of the House. Then the Irish Church Bill was freely described as being "a most niggardly measure," which reminds one of the phrase of the right rev. Prelate the Bishop of St, Davids, of which he is the gratified patentee, when he described this Bill as "a mean little Bill." Then the Church of Ireland, it was said, would be so maimed by its removal from the orbit of the Church of England that it could not possibly be reconstituted in any satisfactory shape, just as we hear about the Welsh Church to-day.
I freely admit once more that the cases are not in the least identical, but it is a fact that many of those prophecies were falsified in the event, as I think I shall be able to point out. Some proved to be greatly exaggerated, others proved to be altogether unfounded; and at any rate it may be argued that there is a prospect that some of the prophecies which are made to-day will also not prove to be perfectly accurate. I quite agree that to those who think that they are suffering a severe moral and material loss it is not pleasant or reasonable that they should be told that the loss will have a highly bracing effect. That I freely admit, and it is an argument which I have never used. Assuming that we are, as noble Lords think, engaged in persecuting the Church after the manner of Diocletian, we should all agree that it would have been very hard if Diocletian had pointed out to thru early Christians what scope he had afforded them for the exercise of the manly virtues. Therefore I abstain from any comment of that kind. But I think that when the noble Marquess speaks of us as passing sentence of death on the Church in Wales he is somewhat exaggerating on his side. It does not in any way represent the effect of our action any more than it represents our intention.
Much has been said in the course of the debate on what may be described as the national argument in favour of Disestablishment. Nobody on our side of the House should fail to note with interest and with respect the serious manner in which both the most rev. Primates spoke of the
1306
weight which ought to be attached to the preponderating opinion of the Parliamentary representatives from Wales. That opinion, however, was not so seriously spoken of by all who took part in the debate, and it has been largely discounted by two arguments, one of which is an old one and the other new. The old argument is that the measure had never been properly before the country. That is an argument which I can remember all my life as being used. It was a favourite argument, I think, of the distinguished father of the noble Marquess opposite, the late Lord Salisbury; and although I am sure noble Lords opposite would admit that they have not themselves always acted on the principle that unless you can show that a particular measure was practically the sole object of thought of the voters at the time of the General Election you had no right to pass it—of course, we could name various instances to the contrary—yet the argument is one to which I suppose a certain degree of force will continue to he attached. What mention was made of the Disestablishment of the Welsh Church by English and Scottish Members in their election addresses I have no idea. I think one right rev. Prelate spoke of the addresses in which Disestablishment was mentioned as being exceedingly few. That may be so. If that is the case I should put it down to the fact that the measure having been before Parliament before and having been adopted as one of the regular, defined objects of the Liberal Party, Members of Parliament who knew that their constituents were not locally interested in the question did not think it necessary to place the entire catalogue of measures before those whose votes they desired to gain.
The second objection which is taken is in one sense the offspring, and a rather newborn offspring, of the other contention—namely, that you have no right to pass a measure of this kind at all unless you are prepared to have a Referendum about it. I am not going to argue the question of the Referendum, upon which, as we know, the noble Lord above the Gangway feels so strongly, but I cannot help being reminded of an observation made, I think, by one of the Labour Members of Parliament the other day in relation to the question of Women's Suffrage, when he pointed out that people who disliked a measure always wished to have a Referen-

1307
dum about it, whereas those who desired to see a Measure passed never did. All that we who are not believers in the Referendum can say is that we do not feel that it is possible to get behind the representative system, and certainly we are not prepared to indulge in what I can only describe as the most separatist course that it is possible for an arguer to take—namely, to examine into the place of origin of the voters in this United Kingdom, which you are determined all of you to keep as a United Kingdom, in the sense of having no devolution admitted; we are not prepared to examine into the place of origin of the particular voters who have supported a measure in order to decide whether their general character and sympathy with ourselves is such as to make it clear that their votes ought to count. The votes in the home counties are, of course, reckoned at their full value, and I daresay some noble Lords would secretly like to reckon them at double their value, but the votes of Irishmen, if they are Nationalists, are not to be allowed to be counted at all in relation to questions effecting a part of this United Kingdom.
We are told that almost the greatest injury that we are by this Bill inflicting upon the Church in Wales—in fact, it is the most obviously candid and deeply entertained opinion of many of the right rev. Prelates—is what is described as its dismemberment; that is to say, its legal separation from the Church of England. It is said that the Church of England and Wales is to be regarded as one and indivisible, and that in attempting to make any division between the two countries we are doing something which we are morally incompetent to do. In fact, if you press that argument to its furthest it will be something of this kind. We an know that the ancient kingdom of Wessex has undergone, as it were, a kind of reincarnation under the wand of a famous writer of the day, and those who object to the provisions of this Bill would, I take it, almost go so far as to say that it would be as unreasonable to disestablish the diocese of Salisbury because it is in Wessex as it is to disestablish these four dioceses which form part of the English Church in Wales. In our view Welsh nationality exists not only by the sentiments eloquently described by the right rev. Prelate the Bishop of Hereford, but also as a hard political fact interpreted in many Statutes by Parlia-
1308
ment. Of course, we entirely appreciate the feelings of the right rev. Prelates from Wales who have given utterance to their thoughts in terms so eloquent and so moving in the course of this debate; but I confess it is hard for us to understand how the existence of the Welsh dioceses or of the Church in Wales can in any way depend upon the legal tie with the Province of Canterbury, however clear that tie may be on historical or on personal grounds; because except in its purely legal aspect and meaning there is no reason, so far as we can see, why it should be severed at all. The noble Viscount, Lord Halifax, who spoke yesterday, described Convocation, from which the four right rev. Prelates are withdrawn by the Bill, as the Synod of the Church in England and to Church in Wales, and he implied that it was a hardship to withdraw those four Prelates from the Synod of their Church. But, my Lords, Convocation has neither the duties nor the privileges of a Synod, and it is a pure misnomer so to describe it. Nobody knows better than the noble Viscount that it has no power of enforcing upon members of the Church of England its will in a large number of matters on which a Synod could enforce it. Therefore it is not accurate to describe it as the Synod of the Church, and it is only because of its purely formal and legal connection with the State that the Disestablishment of the Church in Wales involves the withdrawal from it of the four right rev. Prelates.
The subject of Disestablishment has been discussed at some length during the course of tins debate, and in a manner which I am sure must have profoundly interested the House. Both the most rev. Primates, in the speeches to which we so closely listened, stated the case for the maintenance of the Establishment both here and in Wales with the greatest power and with the greatest moderation. Then we had the striking speech of the right rev. Prelate the Bishop of Oxford, which I am sure impressed deeply even those who did not agree with his conclusion. It cannot have been an easy speech for the right rev. Prelate to make, sitting on those Benches; but I am quite sure that we all recognised that in every sentence of his speech his conscience was speaking. Then the right rev. Prelate the Bishop of Hereford also spoke on Disestablishment, but to him I am afraid it is not so novel an experience

1309
to find himself in isolation amongst his right rev. brethren on those Benches.
I have neither the will nor the power to discuss the matter at any length, but one or two points occur to me which I will venture to mention. It seems to have been assumed by some that the parochial system as such in regard to its maintenance depends on, the existence of an Establishment. Of course, it is quite legitimate to argue, as some have argued on different grounds, that the financial position of the Church would not allow it to maintain its full parochial system. That, of course, is quite a fair argument to use, although I think it may prove to be not a well founded argument. But it is certainly impossible to maintain that the parochial system as such has any connection with the existence of Establishment. As we all know, there is no Church which makes more use, nor very often a finer use, of the parochial system than the Roman Catholic Church, and it would be easy to multiply instances in other parts of the world. But we are asked, after all has been said and done, what is the benefit which the Bill confers on the State in which the Established Church exists? I know, my Lords, what can be said of the advantage to the State of a close connection of the Church; it was my father, I think, who was the author of a phrase which gained some notoriety at the time, when he spoke of "that department of the Civil Service which is called the Church of England." The benefit which accrues to England from having a branch of the Civil Service of that kind has appealed to many people in the past, just as in the same way in the country it has been regarded as a desirable and improving thing for any district that the clergy should be active members of the county bench, that they should take part in the general rural life of the county, so that as the average everyday man walks along the dusty path of life he may have often at his elbow somebody who makes him think of eternal things. That is, I am sure, a highly respectable view, and we all know, and we all have known in our own individual experience, admirable instances of clergy of that kind.
There exist, of course, the two views which have been exemplified in the course of this debate. The tight rev. Prelate the Bishop of Oxford would not,
1310
I think, be prepared to admit, as We can all judge from his speech, that in fact the Stat gets the advantages claimed for it from connection with the Church, and so far as the Church is concerned he does not think that the disabilities in respect of the management of its affairs which are placed upon it through its connection with the State make that connection worth keeping. It is only fair to add that there are others who dread the idea of Disestablishment on entirely different grounds. There are some who are not signally favourable to the existence of the Establishment as it is, but who look forward with a certain degree of nervousness to the existence of a very wealthy and very powerful independent corporation such as the Church of England, if disestablished, would be, even though it were subjected to a certain measure of Disendowment. I noticed that the noble Marquess. Lord Salisbury, who spoke before dinner, put before the House a somewhat singular argument in support of Establishment—namely, that the tendency was in the direction of establishing all forms of religion; and in support of his theory he instanced various disabilities from which Nonconformists had been of late years relieved. That, I confess, seemed to me a somewhat strange argument, because I cannot see how the granting of religious liberty such as is involved by allowing Nonconformists to hold a religious service in a churchyard can be described as in any sense involving the Establishment of that Nonconformist body.
It is quite true that, if the country is convinced by the arguments of the right reverend Bench and by noble Lords opposite that the English Church and the Church in Wales are one and indivisible, if these arguments are good, something like a new lease of life would be given to the Church in Wales, because I will not pretend that if these arguments are held to be good His Majesty's Government would be prepared to-morrow to come down with a Bill involving the Disestablishment of the Church of England as well. I can conceive a Liberationist of the type who, according to the elegant political slang of the day, would be described as a "whole-hogger," not entirely lamenting that fact. He might argue on the ground of what I believe is a familiar trade maxim, that you never ought to crush a weak opposition. I suppose it might be that

1311
such a Liberationist would use the parallel argument that it is not wise to deal with the weakest instance of what you consider an abuse, the weakest, that is to say, from its own standpoint. I do not mean to say if that were so, if it were taken to be a proved truth that you could not disestablish the one Church without the other, that a campaign would be immediately started for the Disestablishment of the Church of England. But I do say this, that many people who have never thought about the subject at all in that light would be tempted to examine with close care and attention the masterly argument put forward by the right rev. Prelate the Bishop of Oxford in that connection.
We have been told that somehow or other the existence of the Establishment goes to help a re-union between the different Churches in Wales. I noticed that the noble Earl on the Cross Benches, Lord Grey, took what I cannot help thinking is a somewhat g sanguine view of the future when he looked forward to such a re-union taking place under the generalship of the noble Marquess, Lord Salisbury. But we have been told—I think it was Lord St. Aldwyn who said it—that the difference of feeling and sentiment between the Established Church and other Churches is really more a social matter than anything else, and that it depends upon a sort of caste feeling, if that is the right word, between the members of the different Churches. I do not know whether that is quite accurate. When you come to think of it, the social differences between two such Nonconformist bodies as the Unitarians and the Primitive Methodists are pretty nearly as wide as those between the Church of England, for example, and such a body as the Unitarians. I do not think, therefore, that the noble Viscount's explanation entirely meets the case, and I think the difference, the deplored difference, that exists between the Establishment and the Nonconformist bodies depends on something deeper than that. The noble Marquess, Lord Lansdowne, asked, as others have asked, Who is injured by the existence of Establishment? Who feels any the worse for it? And I think he mentioned the magnificent and touching celebration at Carnarvon as an instance of how true union of a desirable kind might be brought about for a particular national object between the Church and the Nonconformists. As regards that particular case
1312
that is true, and all of us who know the most rev. Primate would have been absolutely certain that such would be the case. We all know that there is no man of wider mind in this House or out of it. But, after all, the most rev. Primate need not have done it. If there had been an Archbishop of Canterbury of a different type he would have been quite within his rights in confining the religious part of the celebration to the Established Church, and though some might not have thought it the wisest course, nobody would have had any strict right to complain. That being so, I must remind the noble Marquess opposite that to receive a favour of that kind, however gracefully granted, as it was in this instance, is not quite the same thing as being placed on terms of equality and joining by an equal claim in a great national festivity.
The noble Marquess then alluded to the presence of the Welsh Bishops in your Lordships' House. It is no empty compliment or figure of speech to say that if and when they leave this House on all grounds we shall be sorry that they should cease to adorn it. But who knows but that in the future when the noble Marquess opposite brings about his measure of reform of a drastic character depending, as a great many of his supporters I believe desire, largely on election from outside the compatriots of those right rev. Prelates would very likely send them here to adorn these Benches again. The Scottish case has been mentioned in this connection, the case of the kind of re-union which the noble Lord described as likely to take place and indeed as taking place between the Church of Scotland and the Free Church. I do not know that the union of the Churches of Scotland can very reasonably be prayed in aid in this particular connection. After all the doctrines and practices of the different Scottish Churches involved are identical in a much more strict sense than are the doctrines of the Church of England and of some of the Nonconformist bodies. But the Scottish Church goes to work in a somewhat different way. It loses no opportunity, while remaining a respected and popular Establishment, of getting rid on all sides of the control of the State. Some of your Lordships may, perhaps, remember the measure of 1905 called the Churches (Scotland) Bill, which had to do with the allocation of the property of the Free Church on the one side and of

1313
the United Presbyterian Church on the other. In that Bill appeared a clause which gave the Church of Scotland and the other Church involved in the Bid the power of dealing with its own formularies without the consent of Parliament. The fact was duly mentioned in the title, and therefore it properly formed part of the Bill; but the connection between that and the main subject of the Bill was almost as remote as if the clause had been placed in a Bill brought forward by my noble friend behind me dealing with Councils in India. Therefore so long as the Church of England remains, as it does, in a totally different relation to other Churches from that which the Church of Scotland remains in, I do not think it is possible to pray in aid that particular instance.
Then we are told that if you must divest the Church of some of its property why not engage in concurrent endowment? My Lords, a great many people would argue, and I do not know that I might not argue myself in some cases in other parts of the world, that concurrent endowment ought not to be regarded as malum in se, and that if the various people composing the community desire it, it could properly, at any rate, be introduced. But one thing is quite obvious, and has been obvious for many years, and in different relations—namely, that the people of these isles will not have concurrent endowment, and to attempt, therefore, to introduce into this measure an allocation of what, for this purpose, may be called a surplus fund would, so far as I know, satisfy nobody, and the money, as we know, would not be accepted by those to whom it was proferred. I rather console myself with the reflection that, although noble Lords opposite say, "Why do you not introduce a system of concurrent endowment?" if anything of the kind had been done, if the Nonconformist Churches had accepted a single penny of this money to pay off a debt on their buildings, or for the erection of Sunday schools, or for any other thoroughly religious purpose, they would, of course, have been told unanimously by noble Lords opposite, and I may say also by right rev. Prelates, that all their talk about religious equality was the merest fable and pretence, and that all they desired to do was to collar a share of the "swag" in the great robbery which was taking place.
This full House is, as we know, preparing to reject this measure. I am not
1314
going to assume, because I do not believe it, that the refusal of your Lordships to discuss this measure arises out of a kind of pique with the Parliament Act. As I say, I will make no assumption of that kind. Noble Lords opposite must judge for themselves what, from their own point of view, is the best way of putting the case against this Bill before the country. The noble Viscount, Lord Peel, who spoke first alter the dinner adjournment this evening, seemed to fall into the same error which others have often fallen into in assuming that the Bill could not be amended, even though Amendments were made here. That, of course, is not the case. If the Bill is reintroduced it has to be reintroduced in the same form. The object of that is clear, because if an entirely different measure were introduced it would not be fair or reasonable to have it said that the House of Lords had seen it before, and that therefore it was being sent up to them again, merely because it dealt with the same subject. But if a Bill is amended, as your Lordships who have studied the subject well know, at any step, at any of the periods in the life of a Bill, under the Parliament Act Amendments to which both Houses agree can be accepted and added 1;o the Bill. But, as I say, noble Lords opposite must use their own discretion as to the way in which they think it is wisest to put their case before the country. We have never disputed, indeed it is part of the case advanced for the method of acting under the Parliament Act, that if the views of noble Lords are so much accepted by the country that pressure can be brought to bear upon the Government on particular points which may be disliked or condemned that there should be, and ought to be, an amendment of the Bill in those respects, then that could be done. That we have never disputed for a moment. But, of course, if the whole principle of Disestablishment in any sense, and in any form, and under any conditions, is considered by the Party opposite so monstrous and so odious that it ought not to be considered at all, then, of course, there is nothing more to be said.
Many hard things have been said in the course of the discussion, to some extent in this House, though not, I am sure, beyond the bounds of Parliamentary license, on the action of the Government in introducing this Bill. Those of my colleagues who have been specially

1315
attacked for it, as well as my colleagues in another place, are well capable of meeting the charges levelled against them, and they have already done so in respect of this subject, and I have no doubt they will do so again. But when we are told that in introducing this measure we are deliberately inflicting a blow on religion, when we are told we are actuated by nothing but sectarian bitterness, when we are told that we are engaged in the
simple confiscation of other people's property, I can only say we are not affected by such observations as those, because we know they are not true.
On Question, whether the word "now" shall stand part of the Motion?
Their Lordships divided: Contents, 51; Not-Contents, 252.

CONTENTS.

Haldane, V. (L. Chancellor.)

Sandhurst, L. (L. Chamberlain.)

Inchcape, L.

Morley of Blackburn, V. (L. President.)

Aberconway, L.

Loch, L.

Airedale, L.

Lucas, L.

Crewe, M. (L. Privy Seal.)

Ashby St. Ledgers, L.

MacDonnell, L.

Ashton of Hyde, L.

Moulton, L.

Breadalbane, M.

Blyth, L.

Pontypridd, L.

Lincolnshire, M.

Colebrooke, L.

Reay, L.

Courtney of Penwith, L.

Rotherham, L.

Chesterfield, E. (L. Steuard.)

Cowdray, L.

St. Davids, L.

Beauchamp, E.

Devonport, L.

Save and Sele, L.

Craven, E. [Teller.]

Elgin, L. (E. Elgin and Kincardinc.)

Shaw, L.

Kimberley, E,

Shuttleworth, L.

Russell, E.

Emmott, L.

Southwark, L.

Spencer, E.

Eversley, L.

Stanley of Alderley, L. (L. Sheffield.)

Farrer, L.

Allendale, V.

Glantawe, L.

Stanmore, L.

Granard, L. (E. Granard.)

Strachie, L.

Hereford, L. Bp.

Grimthorpe, L.

Weardale, L.

Oxford, L. Bp.

Hemphill, L.

Welby, L.

Herschell, L. [Teller.]

NOT-CONTENTS.

Canterbury, L. Abp.

Brownlow, E.

Lovelace, E.

York, L. Abp.

Cairns, E.

Malmesbury, E.

Camperdown, E.

Mansfield, E.

Norfolk, D. (E. Marshal.)

Cathcart, E,

Manvers, E.

Beaufort, D.

Chichester, E.

Minto, E.

Bedford, D.

Clarendon, E.

Morley, E.

Devonshire, D. [Teller.]

Cottenham, E.

Morton, E.

Leeds, D.

Cromer, E.

Munster, E.

Marlborough, D.

Darnley, E.

Northbrook, E.

Newcastle, D.

Dartrey, E.

Northesk, E.

Portland, D.

Devon, E.

Onslow, E.

Richmond and Gordon, D.

Doncaster, E. (D. Buccleuch and Queensberry.)

Orford, E.

Rutland, D.

Pembroke and Montgomery, E.

Somerset, D.

Eldon, E.

Plymouth, E.

Wellington, D.

Essex, E.

Powis, E.

Ferrers, E.

Radnor, E.

Ailsa, M.

Fitzwilliam, E.

Romney, E.

Bath, M.

Fortescue, E.

Rosse, E.

Bristol, M.

Graham, E. (D. Montrose.)

Rothes, E.

Camden, M.

Grey, E.

Saint Germans, E.

Cholmondeley, M.

Guilford, E.

Selborne, E.

Dufferin and Ava, M.

Haddington, E.

Shaftesbury, E.

Exeter, M.

Halsbury, E.

Stanhope, E.

Lansdowne, M.

Harrowby, E.

Stradbroke, E.

Normanby, M.

Howe, E.

Strange, E. (D. Atholl.)

Salisbury, M.

Ilchester, E.

Vane, E. (M. Londonderry.)

Zetland, M.

Innes, E. (D. Roxburghe.)

Verulam, E.

Kilmorey, E.

Waldegrave, E.

Albemarle, E.

Leicester, E.

Westmeath, E.

Amherst, E.

Lichfield, E.

Wharncliffe, E.

Ancaster, E.

Lindsey, E.

Wicklow, E.

Bathurst, E.

Londesborough, E.

Winchilsea and Nottingham, E.

Bridport, V.

Brancepeth, L. (V. Boyne.)

Lovat, L.

Chilston, V.

Brodrick, L. (V. Midleton.)

Meldrum, L. (M. Huntly.)

Churchill, V. [Teller.]

Burnham, L.

Mendip, L. (V. Clifden.)

Colville of Culross, V.

Carew, L.

Merthyr, L.

De Vesci, V.

Cheylesmore, L

Methuen, L.

Elibank, V.

Clements, L. (E. Leitrim.)

Middleton, L.

Falkland, V.

Clifford of Chudleigh, L.

Monckton, L. (V. Galway.)

Halifax, V.

Clinton, L.

Monk Bretton, L.

Hampden, V.

Clonbrock, L.

Mostyn, L.

Hill, V.

Cloneurry, L.

Napier, L.

Hood, V.

Colchester, L.

Newton, L.

Hutchinson, V. (E. Donoughmore.)

Cottesloe, L

Northbourne, L.

Crawshaw, L.

Oriel, L. (V. Massercene.)

Iveagh, V.

Dawnay, L. (V. Downe.)

Oranmore and Browne, L.

Llandaff, V.

De Mauley, L.

Ormathwaite, L.

Peel, V.

De Saumarez, L.

Penrhyn, L.

Portman, V.

Desart, L. (E. Desart.)

Playfair, L.

St. Aldwyn, V.

Digby, L.

Plunket, L.

Templetown, V.

Dynevor, L.

Ponsonby, L. (E. Bessborough.)

Dunalley, L.

Bangor, L. Bp.

Ellenborough, L.

Rathdonnell, L.

Bath and Wolls, L. Bp.

Elphinstone, L.

Rathmore, L.

Carlisle, L. Bp.

Estcourt, L.

Redesdale, L.

Gloucester, L. Bp.

Faber, L.

Revelstoke, L.

Liverpool, L. Bp.

Farnham, L.

Ribblesdale, L.

Llandaff, L. Bp.

Fingall, L. (E. Fingall.)

Ritchie of Dundee, L.

London, L. Bp.

Forester, L.

Sackville, L.

Peterborough, L. Bp.

Glanusk, L.

St. Audries, L.

Rochester, L. Bp.

Grenfell, L.

St. John of Bletso, L.

St. Albans, L. Bp.

Grenfell, L.

St. Levan, L.

St. Asaph, L. Bp.

Gwydir, L.

St. Oswald, L.

St. David's, L. Bp.

Hampton, L.

Sanderson, L.

Southwell, L. Bp.

Harlech, L.

Sandys, L.

Wakefield, L, Bp.

Harris, L.

Savile, L.

Winchester, L. Bp.

Hastings, L.

Seaton, L.

Worcester, L. Bp.

Hawke, L.

Sefton, L. (E. Sefton.)

Addington, L.

Heneage, L.

Silchester, L. (E. Longford.)

Aldenham, L.

Hindlip, L.

Somerhill, L. (M. Clanricarde.)

Allerton, L.

Hylton, L.

Ampthill, L.

Kenmare, L. (E. Kenmare.)

Somerton, L. (E. Normanton.)

Ashbourne, L.

Kenry, L. (E. Dunraven and Mount-Earl.)

Stewart of Garlies, L. (E. Galloway.)

Ashcombe, L.

Atkinson, L.

Kensington, L.

Sudeley, L.

Balfour, L.

Kenyon, L.

Sudley. L. (E. Arran.)

Barnard, L.

Kesteven, L.

Suffield, F.

Barrymore, L.

Killanin, L.

Tennyson, L.

Basing, L.

Kilmaine, L.

Teynham, F.

Bateman, L.

Kilmarnock, L. (E. Erroll.)

Torphichen, L.

Belper, L.

Kinnaird, L.

Trevor, L.

Berwick, L.

Kintore, L. (E. Kintore.)

Vaux of Harrowden, L.

Biddulph, L.

Lamington, L.

Vivian, L.

Blythswood, L.

Langford, L.

Willoughby de Broke, L.

Bolton, L.

Lawrence, L.

Worlingham, L. (E. Gosford).

Botreaux, L. (E. Loudoun.)

Leconfield, L.

Wynford, L.

Bowes, L. (E. Strathmore and Kinghorn.)

Leith of Fyvie, L.

Zouche of Haryngworth, L.

Lilford, L.

Resolved in the negative accordingly, and Bill to be read 2— this day three months.

AERIAL NAVIGATION BILL.
Order of the Day for the Second Reading read.
LORD HERSCHELL: My Lords, the Bill to which I would draw your Lordships'
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attention this evening, though very short, is by no means unimportant. At the same time, its provisions are so simple and so easy of comprehension that I feel it would be quite superfluous for me to say more than one or two sentences upon them. The object of the first portion of the Bill is to extend the Aerial Navigation Act, 1911, in such a manner as to confer the same powers upon the Secretary for

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War for defence purposes as were conferred in that Act upon the Home Secretary for purposes of public security. The second portion of the Bill, the terms of which are practically identical with a provision in the Consolidated Customs Act, 1876, seeks to place aircraft upon the same footing as vessels upon the sea. I understand, that it is desirable that this measure should be placed upon the Statute Book as soon as possible, and I would therefore ask your Lordships, after the Bill has been read a second time, to suspend the Standing Orders and pass it through all its stages this evening.
Moved, That the Bill be now read 2a.—(Lord Herschell.)
On Question, Bill read 2a.
Committee negatived: Then Standing Order No. XXXIX considered (according to Order) and dispensed with: Bill read 3a, and passed.

TUBERCULOSIS PREVENTION (IRELAND) BILL.
Brought from the Commons; read 1a to be printed; and to be read 2a on Monday next (The Lord Herschell). (No. 215.)
House adjourned at Five minutes before Twelve o'clock, till Tomorrow, half-past Ten o'clock.