Sitting of 14 May 1914

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

PRIVATE BUSINESS.
Private Bills [Lords] (Standing Orders not previously inquired into complied with),—Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the following Bill, originating in the Lords, and referred on the First Reading thereof, the Standing Orders not previously inquired into, which are applicable thereto, have been complied with, namely:—
Mansfield Railway Bill [Lords].
Ordered, That the Bill be read a second time.
Provisional Order Bills (Standing Orders applicable thereto complied with),—Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That, in the case of the following Bills, referred on the First Reading thereof, the Standing Orders which are applicable thereto have been complied with, namely:—
Local Government Provisional Orders (Gas) Bill.
Western Valleys (Monmouthshire) Railless Electric Traction Provisional Order Bill.
Ordered, That the Bills be read a second time To-morrow.
Didcot, Newbury, and Southampton Railway Bill [Lords],
Read the third time, and passed, with Amendments.
Tees Valley Water Bill,
Read the third time, and passed.
Abertillery and District Water Board Bill [Lords] (by Order),
Third Reading deferred till To-morrow.
Brecon and Merthyr Tydvil Junction Railway Bill (by Order),
Consideration, as amended, deferred till To-morrow.
Great Eastern Railway Bill [Lords] (by Order),
Second Reading deferred till To-morrow.
Brentford Gas Bill [Lords] (by Order),
Read a second time, and committed.
Electric Lighting Provisional Order (No. 8) [Kingstown] Bill [Lords] (by Order),
Consideration, as amended, deferred till To-morrow.
Trade Boards Act Provisional Order Bill (by Order),
Second Reading deferred till Monday next.
Pier and Harbour Provisional Orders (No. 3) Bill,
"To confirm certain Provisional Orders made by the Board of Trade under the General Pier and Harbour Act, 1861, relating to Amlwch, Armadale, and Fraserburgh." Presented by Mr. ROBERTSON; read the first time; to be referred to the Examiners of Petitions for Private Bills, and to be printed. [Bill 246.]
Local Government Provisional Order (No. 14) Bill,
"To confirm a Provisional Order of the Local Government Board relating to Birmingham." Presented by Mr. HERBERT LEWIS; supported by Mr. Herbert Samuel; read the first time; to be referred to the Examiners of Petitions for Private Bills. and to be printed. [Bill 247.]
Local Government Provisional Orders (No. 15) Bill,
"To confirm certain Provisional Orders of the Local Government Board relating to the Amman Valley, and the Ludworth and Mellor Joint Sewerage Districts, the Halstead Joint Hospital District, and the East Wilts United Districts." Presented by Mr. HERBERT LEWIS; supported by Mr. Herbert Samuel; read the first time; to be referred to the Examiners of Petitions for Private Bills, and to be printed. [Bill 248.]
Local Government Provisional Orders (No. 16) Bill,
"To confirm certain Provisional Orders of the Local Government Board relating to Bournemouth and Bradford." Presented by Mr. HERBERT LEWIS; supported by Mr. Herbert Samuel; read the first time; to be referred to the Examiners of Petitions for Private Bills, and to be printed. [Bill 249.]
Local Government Provisional Orders (No. 17) Bill,
"To confirm certain Provisional Orders of the Local Government Board relating to Chatham, and the Rochester and Chatham Joint Sewerage District." Presented by Mr. HERBERT LEWIS; supported by Mr. Herbert Samuel; read the first time; to be referred to the Examiners of Petitions for Private Bills, and to be printed. [Bill 250.]

NATIONAL INSURANCE ACT.
Copy presented of Regulations made by the Welsh Insurance Commissioners, dated 13th May, 1914, entitled the National Health Insurance (Wales) (Claims for Exemption) Regulations, 1914 [by Act]; to lie upon the Table, and to be printed. [No. 229.]
Copy presented of Regulations made by the Scottish Insurance Commissioners, dated 7th May, 1914, entitled the National Health Insurance (Appointment of Representatives of Insured Persons on Insurance Committees) Amendment Regulations (Scotland) 1914 [by Act]; to He upon the Table, and to be printed. [No. 230.]

RAILWAY ACCIDENTS.
Copy presented of Returns of Accidents and Casualties as reported to the Board of Trade by the several Railway Companies in the United Kingdom during the three months ended 31st December, 1913 [by Command]; to lie upon the Table.
ORAL ANSWERS TO QUESTIONS.

  Greeks and Christians (Kolonia).
  Mr. AUBREY HERBERTasked the Secretary of State for Foreign Affairs whether he has any information regarding the burning by the Greeks of the following villages in the district of Kolonia: Vrebsoka, Oseska, Radan, Radimislit, Poda, Barmash, Leshna, Gjone, Aripas, Tach, Kodras, Kamnik, Rajan, Starje, Psar, Qinan, Selenica; and whether the corpses of twenty-eight Greek soldiers and some evzones were found?
  The SECRETARY of STATE for FOREIGN AFFAIRS (Sir Edward Grey): The villages referred to are not mentioned in any reports received by me respecting
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  recent events in Epirus, and I have no information with regard to them.
  Mr. AUBREY HERBERTasked the Secretary for Foreign Affairs if he has any information as to whether the Greeks, in retiring, have compelled Christians to accompany them in order to give the impression that the Christians will not live in Albania?
  Sir E. GREY: Such an allegation is made in the telegram referred to in my reply to the hon. Member's next question. I am at present unable to verify it.
  Mr. AUBREY HERBERTasked the Secretary for Foreign Affairs if he has yet received the telegrams which the Christians of Southern Albania have sent to the Chancelleries of the Great Powers regarding ill-usage; and, if the Government are unable to obtain accurate information on the subject, if he will communicate with Mr. Tsilka, Protestant missionary at Koritza?
  Sir E. GREY: I have received such a telegram purporting to be in the name of the Christian inhabitants of the Koritza district. I am in communication with the British delegate on the Commission of Control in regard to it, and he will doubtless make inquiries of Mr. Tsilka should occasion require.

  Evicted Tenants (Ireland).
  Mr. CRUMLEYasked the Chief Secretary for Ireland the number of evicted tenants who have not yet been reinstated in their holdings, or been provided with holdings in lieu of them, under the Evicted Tenants Act?
  The CHIEF SECRETARY for IRELAND (Mr. Birrell): There have been 3,370 evicted tenants or the representatives of evicted tenants reinstated in their former holdings or provided with new holdings as purchasers under the Irish Land Purchase Acts, and 260 have been provisionally noted for consideration by the Estates Commissioners in connection with the allotment of untenanted land as acquired.
  Mr. LYNCH: May I ask the right hon. Gentleman why he does not deal largely and generously with this question, this irritating question, so as to remove it once for all from the purview of politics?
  Mr. BIRRELL: "Largely" and "generously" are words of varied interpretation, and I am disposed to think that has already been done.
  Mr. CRUMLEY: Is there any prospect of those tenants who are still out getting reinstated in their former holdings?
  Mr. BIRRELL: Of course, a number of evicted tenants for definite reasons have been passed over altogether as being persons who would make no use, or no good use, of agricultural holdings. There are only 260 persons who have been passed, and who have not yet been provided for.
  Mr. O'SHAUGHNESSY: Will the right hon. Gentleman see that those 260 persons are dealt with without further delay?
  Mr. BIRRELL: Yes; I will see that they are dealt with as quickly as possible.
  Mr. CRUMLEYasked the Chief Secretary if ho will ask the Estates Commissioners to reconsider the case of Thomas Courtney, brother and legal representative of the late Henry Courtney, an evicted tenant who applied for reinstatement or for a new holding under the Evicted Tenants Act; and will he call the Commissioners' attention to the fact that the necessary notices of application were served in due time, and that Thomas Courtney has eight sons and five daughters to provide for?
  Mr. BIRRELL: As the hon. Member has already been informed, the Estates Commissioners, after inquiry and consideration, decided not to take any action with reference to the late Henry Courtney's application for reinstatement in a holding on the estate of Lord Rathdonnell, county Fermanagh, formerly occupied by him, and now in the possession of another tenant, and they are not prepared to provide his representative with a holding elsewhere. The Commissioners cannot see their way to depart from their decision in this case.
  Mr. CRUMLEY: Is it not the fact that the applicant, who is brother and legal representative of Henry Courtney, has eight sons and three daughters still un-provided for, and that he was put off a holding of 200 acres?
  Mr. BIRRELL: That may be so, but I cannot see my way to make any alteration in the decision of the Commissioners.
  Mr. CRUMLEYasked the Chief Secretary if he will ask the Estates Commissioners to reconsider the application of James M'Gourty for reinstatement in the holding of Belcoo, county Fermanagh, from which he was evicted, or to provide him with a new holding in lieu of it?
  Mr. BIRRELL: As I have already informed the hon. Member, the Estates Commissioners see no reason to alter their decision in the matter of James M'Gourty's application for reinstatement.
  Mr. CRUMLEY: May I ask the right hon. Gentleman what there is against this young man that he could not get some holding in place of the one he was evicted from?
  Mr. BIRRELL: It is a matter left to the decision of the Commissioners, and I cannot take it upon myself to revise this decision.
  Mr. WILLIAM REDMONDasked the Chief Secretary how many men, women, and children were recently evicted at Augnish, North Clare, on the Wilson Lynch estate, and the circumstances under which they were evicted; whether any efforts were made to purchase this estate and why such efforts, if made, failed; and whether any further efforts will be made to settle the estate by purchase and so bring about the reinstatement of the people who have been evicted?
  Mr. BIRRELL: I am informed that six families, consisting of thirty persons, including men, women, and children, were evicted on this estate for non-payment of rent. The estate was offered for sale to the Congested Districts Board, but before an offer for purchase was issued the owner died, and his son has decided not to proceed with the sale at present. The Board are quite ready to take any action open to them in the matter.
  Mr. WILLIAM THORNE: May I ask whether the forces of the Crown were used in evicting these tenants from their holdings?
  Mr. BIRRELL: I have no doubt the police were present. I have no power to stop them.
  Mr. WILLIAM REDMOND: May I ask whether, in accordance with the new doctrine laid down, the police were asked if they had any conscientious objections to throwing out these old men, women, and children on to the roads?
  Mr. BIRRELL: I hope not.
  Mr. W. REDMOND: Will the right hon. Gentleman see whether the Congested Districts Board can open up fresh negotiations with a view to the reinstatement of those tenants?
  Mr. BIRRELL: Certainly I will.

  Petty Sessions Clerk, Brookborough, County Fermanagh.
  Mr. CRUMLEYasked the Chief Secretary why advertisements have not yet been issued for candidates for the office of clerk of Petty Sessions at Brookborough, county Fermanagh; and will he take steps to have the appointment made without further delay?
  Mr. BIRRELL: It is proposed to make certain alterations in the Brookborough Petty Sessions district, and the proposal will be considered at the Quarter Sessions to be held at Enniskillen next month. Pending the decision of the justices, the election of a clerk cannot be held.

  Housing Schemes (Ireland).
  Mr. O'SHAUGHNESSYasked the Chief Secretary if he can state when the £1,000,000 promised by the Government for the housing of the working classes in Ireland will be available; whether he is aware that there are a number of schemes for the building of cottages passed by the Local Government Board for two years or more at a standstill for want of funds, although the houses are badly needed to replace the hovels at present existing; and whether, having regard to these facts, he will without further delay introduce a Bill dealing with this matter without waiting for the passage of the Irish Land Bill into law?
  Mr. BIRRELL: No schemes which have been approved by the Local Government Board have been held up for want of money, but there are a number of schemes which have not yet been inquired into owing to funds not being available. As stated, in the event of no agreement being arrived at as regards the Land Bill, I shall endeavour to introduce a one-Clause Bill securing a sum of £1,000,000 to complete outstanding schemes for the erection of labourers' cottages in Ireland, but I am not at present in a position to make any further statement on the subject.
  Mr. GINNELL: Will the right hon. Gentleman explain to the House the difference between "want of money" and "want of funds," which he read from the Paper in his hands?
  Mr. O'SHAUGHNESSY: Will the right hon. Gentleman make inquiries into the facts alleged in my question, which are perfectly accurate, that there are schemes approved of by the Local Government
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  Board that have been held up for two years for want of funds, and can he say when the Labourers Bill—in the event of the Land Bill not passing as an agreed measure—is likely to become law?
  Mr. BIRRELL: The statements in the question are, I believe, perfectly accurate, but no schemes actually approved are being held up. There are a number of schemes under consideration which are not being proceeded with because of the absence of money. That is perfectly true. I can assure the hon. Gentleman that no effort on my part will be wanting to see that this sum of a million required for these schemes is forthcoming before the end of the Session.
  Mr. O'SHAUGHNESSY: Will the right hon. Gentleman inquire into the scheme put forward by the Rathkeale District Council, which has been approved by the Local Government Board and passed four years ago, but cannot be carried through for want of money?
  Mr. BIRRELL: Yes; I will inquire.
  Mr. RONALD M'NEILL: Will the one-Clause Bill be introduced this Session?
  Mr. BIRRELL: I hope so; unless it is included in the Land Bill.

  Teaching Irish.
  Mr. O'DONNELLasked the Chief Secretary for Ireland whether he has yet been able to induce the Treasury to sanction the scheme for the teaching of Irish recommended by the National Board of Education, the managers and teachers of Ireland, and representatives of the Irish county councils; and, if not, will he state on what educational grounds they defend their refusal?
  Mr. BIRRELL: I have nothing to add to my reply to the question of the hon. Member on this subject on 23rd April.

  Outrages (Ireland).
  Mr. F. HALLasked the Chief Secretary for Ireland if his attention has been called to the recent defacing of a statue erected at Cork to the memory of Irishmen who fought for Great Britain in the Boer war; and if any steps have been taken to trace the perpetrators of this and similar outrages committed in, other parts of Ireland recently?
  Major ARCHER-SHEE: Before this question is answered may I ask if there

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  is not a mistake in it? Those soldiers laid down their lives for Great Britain and Ireland?
  Mr. BIRRELL: I cannot quarrel with the language in which questions are addressed to me. My business is to answer them. I would refer the hon. Member to my reply to a somewhat similar question asked by the hon. Member for the Enfield Division on the 24th March. The police are not aware of any more recent occurrences of this nature in any part of Ireland.
  Mr. F. HALL: May I ask if this is another one of the expressions of sympathy which we shall probably have after the passing of the Home Rule Bill?
  Mr. RONALD N'NEILLasked the Chief Secretary whether he is aware that a highway robbery was committed near Abbeyfeale, in county Limerick, on the morning of 2nd April, and that the local postman was stopped on the road by two disguised men carrying rifles and robbed of all the money for old age pensions which he was carrying; and whether any arrests have been made?
  Mr. BIRRELL: A robbery of the nature referred to occurred on the morning of the 3rd April near Abbeyfeale, but the mail bag has since been recovered intact. The police have the matter in hand, but have not yet sufficient evidence to justify an arrest.
  Mr. RONALD M'NEILLasked the Chief Secretary if he is aware that a number of gates on the land of Mr. Pierce at Tacumshane were knocked down and destroyed by some person on the night of 1st May or the early morning of 2nd May; what is the reason for this action; and what steps have been taken to find the offenders?
  Mr. BIRRELL: I am informed that five gates on the lands of Mr. Pierce were broken on the dates named and removed from their hinges. I have no information as to the motive which inspired this occurrence. The police are pursuing their inquiries, but so far have not obtained sufficient evidence to justify any arrests.
  Mr. RONALD M'NEILLasked the Chief Secretary whether he is aware that a shooting outrage was committed in the Bawnmore district of the county Galway on the evening of 31st March, when a man, proceeding home near Bawnmore, was fired at and wounded; and whether any arrests have been made?
  Mr. BIRRELL: It is a fact that a man named Bernard Ward was fired at and wounded in the leg with five grains of shot on the night of the 30th March. The matter was not reported to the police and the injured man would give them no information to assist them in their inquiries. So far, no person has been made amenable.
  Mr. R. M'NEILL: Can the right hon. Gentleman say whether the man was seriously injured or not?
  Mr. BIRRELL: I should consider five grains of shot in the leg somewhat serious, but I am glad to be able to say he stands in no danger of having a long indisposition.
  Mr. REMNANT: We are constantly hearing of no arrests having been made; are special attempts made to inquire into the matters?
  Mr. BIRRELL: Yes, most active attempts are made.
  Mr. J. WARD: Do you make similar attempts in the case of gun-runners?
  HON. MEMBERS: With equal success?
  Mr. R. M'NEILLasked the Chief Secretary whether he is aware that at the fair of Crossmolina, on 8th April, a number of men armed with sticks and making a great noise, endeavoured to terrorise Edward Barrett and his brother Richard; if he will state for what reason these two men were subjected to this intimidation; and what steps are being taken to afford them protection?
  Mr. BIRRELL: I am informed by the police that Edward Barrett was the object of a hostile demonstration on the occasion referred to, but not his brother. The reason is believed to be a misunderstanding about the letting of certain land. Fifteen persons were arrested in connection with the occurrence, and four of them have been bound over to be of good behaviour, and the remainder were discharged. Mr. Barrett will be afforded all necessary protection by the police.
  Mr. R. M'NEILL: Does the right hon. Gentleman think that this was the result of an honest misapprehension?
  Mr. BIRRELL: No, Sir, I do not.
  Mr. R. M'NEILLasked the Chief Secretary whether his attention has been drawn to the disturbances at the chapel at Ballybricken on 15th April; whether they arose from dissatisfaction with the distribution of land by the Estates Commissioners on the Roche Kelly estate; and

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  what steps are being taken to afford protection to those against whom the demonstration was made?
  Mr. BIRRELL: My attention has been called to this matter, and I understand that these disturbances were due to dissatisfaction with the distribution of certain land by the Estates Commissioners on the estate referred to. Thirteen of the principal offenders were arrested and have been returned for trial at the next Assizes. The surrounding police stations have been strengthened by fourteen extra men, and all necessary protection will be afforded to those requiring it.
  Mr. R. M'NEILL: Can the right hon. Gentleman state the grounds on which these people were attacked?
  Mr. BIRRELL: Anybody who has any knowledge of the distribution of land in those districts knows it is exceedingly difficult to avoid dissatisfaction.
  Mr. REMNANT: The right hon. Gentleman referred to a Land Bill just now. Is it proposed to introduce that Land Bill this Session?
  Mr. BIRRELL: That is a question of which I should like notice.
  Mr. O'SHAUGHNESSY: May I ask the right hon. Gentleman if he will take steps to see that in future when the Estates Commissioners are dividing untenanted lands that the inspectors take into consideration the local feeling in the districts to see that popular applicants should get these lands?
  Mr. BIRRELL: I can assure the right hon. Gentleman that local feeling predominates very largely in the distribution of any land.
  Mr. MITCHELL-THOMSONasked the Chief Secretary whether Canon Gerahty has possession of the Skahard farm on the Pollock estate, county Gaway; and will he say how many drives, or attempted drives, there have been of cattle from this farm, and whether there have been any other disturbances in connection with the farm on this estate?
  Mr. BIRRELL: The answer to the first paragraph is in the affirmative. With regard to the remainder of the question I would refer the hon. Member to the reply to a similar question by the hon. Member for Enfield on 30th April.
  Mr. MITCHELL-THOMSONasked the Chief Secretary whether he is aware that a crowd of men were met by the police on the morning of 29th April at Loughrea driving stock, and that as a result of the meeting a conflict between the police and the crowd followed; how many police were injured in such conflict; and what punishment has been inflicted upon the men concerned in the outrage?
  Mr. BIRRELL: A mob of about forty people armed with sticks, who were driving sheep off a farm near Loughrea, were intercepted by a force of ten police, and as they refused to desist and assumed a threatening attitude, a baton charge was ordered and the mob dispersed. The district inspector received a severe scalp wound, and nearly all the police engaged were injured, but not seriously. Fourteen persons have been returned for trial to next Assizes in connection with the affair.
  Mr. W. THORNE: Can the right hon. Gentleman tell us what is the cause of this cattle driving?
  Mr. BIRRELL: Dissatisfaction with the distribution.
  Mr. J. WARD: Can the right hon. Gentleman tell us how baton charges were made on those who break the law in these cases and not in others?
  Mr. BIRRELL: They are rather different. Here there were ten policemen against forty men, and in the case to which I think the hon. Gentleman refers there were two policemen against 800 men.
  Mr. MITCHELL-THOMSONasked the Chief Secretary whether he is aware that an armed attack was made upon a police patrol at Cleggan, in county Galway, on the 1st May; that the police patrol of three constables was fired on from behind a wall on the public road, and the constables returned the fire from their rifles; and whether any arrests have been made or anyone made amenable?
  Mr. BIRRELL: I would refer the hon. Member to my reply to a similar question by the hon. Member for Enfield on the 7th instant, to which I have nothing to add.
  Mr. MITCHELL-THOMSON: May I ask whether, in point of fact, any arrests have been made?
  Mr. BIRRELL: No, Sir, not so far.
  Mr. F. HALL: Do they intend to make any?
  Mr. MITCHELL-THOMSONasked the Chief Secretary whether he is aware that an armed attack was made on the house of Timothy Casey, near Hollymount, in county Mayo, on the night of 19th April, when three gun shots were fired at the bedroom window when the inhabitants were asleep; whether the windows were broken by pellets of shot; and whether any arrests have been made or anyone made amenable?
  Mr. BIRRELL: The police authorities inform me that on the night of the 19th April three gun shots were fired into the house of Timothy Casey. Two of the shots were fired at the kitchen window, the room being unoccupied at the time, and the other shot was fired at the window of the bedroom occupied by his eldest son—a pane of glass was broken, but no other injury was done. So far no person has been made amenable.

  County Clare Trials (Change of Venue).
  Mr. MITCHELL-THOMSONasked the Chief Secretary in how many cases the Attorney-General applied for changes of venue from county Clare to county Dublin in the King's Bench Division on Friday last; for what reason the application was made; and whether any steps are being taken to remove the feeling of terror that prevails in county Clare and prevents fair trials?
  Mr. BIRRELL: The Attorney-General applied for change of venue to county Dublin in four cases from the county Clare. The application was made on the ground that, in the belief of the responsible officials, a fair trial was not likely to be had in the county Clare. There is a large extra force of police in the county and special measures have been and are being taken for the protection of life and property and the prevention of outrages. I am happy to say that the condition of the county is improving.

  GOVERNMENT OF IRELAND BILL.

    ARMY (MUTINY).
    Mr. F. HALLasked the Prime Minister if his attention has been called to the statement by the Chancellor of the Exchequer charging the Opposition with having incited mutiny in the Army; and if any evidence is in the possession of the Government which bears out this charge?
    The PRIME MINISTER (Mr. Asquith): I presume my right hon. Friend refers to the statements of Members of the Opposition which were quoted and referred to in the Debate in this House on the 30th March.
    Mr. F. HALL: Has the right hon. Gentleman seen the message that was sent by the Chancellor of the Exchequer to the Radical candidate for Grimsby, in which the right hon. Gentleman stated that the Unionist party are encouraging mutiny in the Army? Does the right hon. Gentleman agree with the statement?
    Mr. SPEAKER: I have already disallowed a question put in that form. The hon. Member is not entitled to ask the Prime Minister whether he agrees or disagrees with a colleague.
    Mr. G. FABER: Is it proposed to institute prosecutions against any of the Members of the Opposition for incitement to mutiny?
    The PRIME MINISTER: I answered that question yesterday.
    Mr. REMNANT: May I ask whether there has been mutiny in the Army recently?
    The PRIME MINISTER: No, Sir; there has not.

    AMENDING BILL.
    Sir CLEMENT KINLOCH-COOKEasked the Prime Minister whether, in the event of the Bill to amend the Government of Ireland Bill not being an agreed Bill, it is the intention of the Government to pass the measure through all its stages in the House of Commons in such a way as to give the House the opportunity of full and free discussion of the Government proposals; and at what date does he expect to be able to introduce the Bill?
    The PRIME MINISTER: I am not at present prepared to add anything to what was said in the House on Tuesday last on this subject.
    Sir C. KINLOCH-COOKE: Does not the right hon. Gentleman consider that it will be necessary to have an Autumn Session?
    The PRIME MINISTER: That is a hypothetical question.

    IMPERIAL AND LOCAL TAXATION.
    Mr. NEWMANasked the Chancellor of the Exchequer whether the sum of £630,000, which it is proposed to allocate to Ireland for the purpose of readjusting the relations between Imperial and local taxation, will be stereotyped at that figure or readjusted from year to year in accordance with the needs and expenditure of such Irish local authorities as may comply with the conditions laid down as necessary for receiving a Grant?
    The CHANCELLOR of the EXCHEQUER (Mr. Lloyd George): Allowance will be made for this sum in calculating the amount of the Transferred Sum, which is not subject to revision.
    Mr. NEWMANasked the Chancellor of the Exchequer whether, in the event of the Government of Ireland Bill being placed on the Statute Book before the Finance and Revenue Bills of this year, the sum of £630,000 towards the relief of local taxation will be given unconditionally to the Irish Government, or whether a national valuation, separating site value from improvements, will be a condition of the Grant and other conditions laid down defining the terms on which or the purposes for which the Grant can be claimed by local authorities?
    Mr. LLOYD GEORGE: The sum given will be at the disposal of the Irish Government.
    Mr. NEWMAN: Has the Chancellor of the Exchequer read Clause 14 of the Government of Ireland Bill?
    Mr. LLOYD GEORGE: I am quite prepared to read it.

  Rhodesia.
  Mr. ORMSBY-GOREasked the Secretary of State for the Colonies whether he authorised the Resident Commissioner in Southern Rhodesia to inform the newly elected Legislative Council of Rhodesia that he proposed to veto the Land Settlement Ordinance if it passed the Rhodesian Chamber in its present form; whether, in spite of this information, the Land Settlement Ordinance has been supported by the majority of elected as well as nominated
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  members of the Council; and whether he still proposes to override the decision of the elected representatives of the Rhodesian people?
  The SECRETARY of STATE for the COLONIES (Mr. Harcourt): I have not received any official statement of the remarks made by the Resident Commissioner which appear to have been uttered in the course of debate. No instruction has been sent to the effect that the Land Settlement Ordinance will not be assented to. His Majesty's Government intend to await the decision of the Legislative Council and the full report of the proceedings before coming to any decision with regard to this Ordinance, which raises some difficult questions. The High Commissioner informs me that the Ordinance has passed the second reading by a majority of eight, five elected members voting in favour of postponement.
  Sir GILBERT PARKER: May I ask whether it is intended to give the House an opportunity of discussing this matter before a decision is come to by the Government?
  Mr. HARCOURT: I have no doubt such an opportunity will arise.
  Mr. BRIDGEMAN: Will a decision not be taken before the Colonial Office Vote comes on?
  Mr. HARCOURT: That depends on when the Colonial Vote is taken, and that depends on arrangements.
  Mr. BRIDGEMAN: Will the right hon. Gentleman realise our interest to know how soon a decision will be taken?
  Mr. HARCOURT: Is the hon. Gentleman referring to the Land Settlement Ordinance or the general question of land settlement in Rhodesia?
  Mr. BRIDGEMAN: Land Settlement Ordinance.
  Mr. HARCOURT: I do not think the decision is likely to be taken immediately.
  Sir G. PARKER: Will the right hon. Gentleman give an assurance that the Government will not give its decision and announce it to the High Commissioner before the Colonial Office Vote is taken, no matter when that Vote is taken?
  Mr. HARCOURT: If the hon. Member will give me notice of that question I will answer it.

  NATIONAL INSURANCE ACT.

    PANEL CHEMISTS.
    Mr. GODFREY LOCKER-LAMPSONasked the hon. Member for St. George's-in-the-East, as representing the Insurance Commissioners, whether a number of insurance committees are finding that the claims on their drug fund for chemists' accounts are growing in amount as compared with last year, whether such is the case with committees which had insufficient money to pay the chemists' accounts in full last year; and what the Government propose to do to meet these increasing deficiences?
    Mr. WEDGWOOD BENN (Lord of the Treasury): Until the total sums available to each insurance committee have been finally ascertained, and the accounts have been scrutinised, the assumptions underlying the question cannot be accepted. In a few cases the Insurance Commissioners have received information that the accounts for the quarter, which ended on the 11th of last month, are in excess of those for the same quarter of last year; but no comparison between the amounts can properly be made until the accounts for each period have been examined.
    Mr. G. LOCKER-LAMPSON: Can the hon. Member say when this scrutiny will take place, and when we shall really know what deficiencies the chemists have to meet?
    Mr. W. BENN: Does the hon. Gentleman refer to last year's accounts or this?
    Mr. G. LOCKER-LAMPSON: Last year.
    Mr. W. BENN: That is in progress.
    Mr. F. HALL: Can we not have a provisional figure?
    Mr. W. BENN: We cannot get a provisional figure of the scrutiny. The scrutiny will determine it exactly.
    Mr. F. HALL: Can we not have some record showing what is the deficiency?
    Mr. W. BENN: The scrutiny is now proceeding and will show what the exact position is.
    Mr. F. HALL: I am afraid the hon. Gentleman does not quite understand my question?
    Mr. SPEAKER: The hon. Gentleman had better put it on the Paper.
    Mr. GODFREYLOCKER-LAMPSONasked whether the chemists under contract
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    with the West Hartlepool Insurance Committee have had 30 per cent. deducted from their bills for last quarter, chiefly because the committee has insufficient funds to meet the bills; whether there is still outstanding and unpaid 10 per cent. of the chemists' bills for each quarter of last year; if the number of prescriptions dispensed in that area have increased from 1,800 in the quarter ending April, 1913, to 2,200 in the corresponding quarter this year, and the cost increased from about £525 to £754; and whether the chemists and the insurance committee have expressed their dissatisfaction to the Commissioners.
    Mr. W. BENN: The Insurance Commissioners hope to be able to inform the committee referred to at an early date of the total sum available to them, from the drug fund for the past year. In the meantime, any payments made to the chemists are in the nature of advances only. For the reasons explained in my previous reply to the hon. Member, no comparison can properly be made at present between the accounts for last quarter and for the corresponding period of last year.
    Mr. CASSEL: Is the hon. Gentleman aware that real hardship is being experienced by these chemists through their not being paid their bills?
    Mr. W. BENN: That is a general statement. I cannot say whether it bears out the facts substantially.
    Mr. WORTHINGTON EVANS: Is the hon. Gentleman aware that the Insurance Commissioners said two months ago that they hoped to settle it at an early date? Will he now define what is an early date?
    Mr. W. BENN: The scrutiny is now proceeding.
    Mr. FELL: The case of the chemists is very different from that of the doctors. The chemists are largely out of pocket.
    Mr. SPEAKER: If hon. Members insist on asking supplementary questions, those, hon. Members whose questions are late on the Paper cannot expect to get their questions answered in the House.

    AMENDING BILLS.
    Mr. GODFREY LOCKER-LAMPSONasked the Prime Minister whether he will arrange for the Committee stages of the two Bills amending the health and unemployment parts of the National Insurance Act not to be taken at the same time, so as

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    to allow hon. Members who are interested in both these subjects an opportunity to take part in the discussions?
    The PRIME MINISTER: I will note the hon. Member's suggestion, and see what can be done with regard to it; but I am not yet in a position to make a definite statement on the subject.

    REGULATIONS.
    Mr. GODFREY LOCKER-LAMPSONasked whether the draft arrears Regulations under the National Insurance Act will be laid upon the Table of the House; if not, whether they will be laid upon the Table as Provisional Regulations; and, if so, when?
    Mr. W. BENN: I would refer the hon. Member to the reply which I gave yesterday to the hon. Member for the Camlachie Division.
    Mr. FREDERICK WHYTEasked the President of the Board of Trade whether any progress has been made with the proposed revision of the Board's Regulations in the direction of removing the grievance recently illustrated in the case of the workmen employed by the Perth General Station Committee where the committee disputed their liability to contribute under Part II. of the National Insurance Act?
    The PRESIDENT of the BOARD of TRADE (Mr. Burns): The matter to which my hon. Friend draws attention is one which requires careful consideration, but I hope very shortly to be able to come to a decision with regard to it.

    TUBERCULOSIS (TREATMENT).
    Mr. ASTORasked the President of the Local Government Board whether the local authorities which undertake the treatment of uninsured persons suffering from tuberculosis within their district, with the aid of the Hobhouse Grant, have power to provide for persons in receipt of domiciliary treatment the following among other articles of food, namely, milk, butter, eggs, bread, fish, and meat; and, if so whether he will state what Statute or Statutes give local authorities the power to make the above provision?
    The PARLIAMENTARY SECRETARY to the LOCAL GOVERNMENT BOARD (Mr. Herbert Lewis): My right hon. Friend is in communication with the Treasury on
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    this subject, and is not at present in a position to answer the question.
    Mr. ASTOR: Am I to understand that no such form of domiciliary treatment is now being given?
    Mr. LEWIS: The whole question is under consideration.
    Mr. GOULDINGasked the Chancellor of the Exchequer whether, in addition to the proposals outlined in his speech in introducing the Budget, he will consider the possibility of placing adequate institutional treatment at the disposal of insured persons as part of their medical benefit?
    Mr. W. BENN: My right hon. Friend will be glad to consider the hon. Member's suggestion, though I would remind him that the provision of Grants in aid of the voluntary hospitals would necessarily raise the question of State control.

  POST OFFICE.

    ENGINEER-IN-CHIEF (SALARY).
    Mr. FREDERICK WHYTEasked the Postmaster-General what is the salary of the chief engineer to the Post Office?
    The POSTMASTER-GENERAL (Mr. Hobhouse): The engineer-in-chief to the Post Office is on a scale of pay rising from £1,000 to £1,200 by annual increments of £50.
    Mr. F. WHYTE: Does the right hon. Gentleman contemplate raising the status of the engineering department in view of the greatly increased responsibility of that department under the new telephone administration?
    Mr. HOBHOUSE: I have to submit all proposals for increases to the Treasury, and, while I should be very willing in certain cases to raise individual salaries, I am not quite sure whether I should be able to persuade my right hon. Friend in that Department to agree.
    Mr. F. WHYTE: Does my right hon. Friend see the importance of attracting the very highest talent to these posts?
    Mr. HOBHOUSE: Yes, I do, and I am trying to persuade other people to that effect.
    Mr. COURTHOPE: Is there not an immense amount of extra work thrown on the chief of the engineering department since the Report of the Committee on the engineering side?
    Mr. HOBHOUSE: I do not think that it is any greater than the increase of work and responsibility which has fallen on other departments of the Post Office in the last five or six years.

    NEWBURGH (FIFE) OFFICE.
    Mr. F. WHYTEasked the Postmaster-General whether he proposes to compensate those employés who will suffer loss owing to the change in the status of the Post Office at Newburgh, Fife?
    Mr. HOBHOUSE: No question of pecuniary loss or compensation arises. Positions in other offices are being found for the officers concerned.

    PARCELS POST RATES.
    Mr. F. WHYTEasked the Postmaster-General whether he can furnish a list of all those countries which have established a parcels post and the respective rates in force in each?
    Mr. HOBHOUSE: I am not in possession of full information in all cases, but I have information respecting most of the principal countries, and I shall be happy to supply that to the hon. Member.

    WAGES (WILTSHIRE).
    Mr. LEACHasked what is the minimum wage paid to postmen over twenty-one years of age employed full time in the county of Wiltshire?
    Mr. HOBHOUSE: If the hon. Member means a postman over twenty-one years of age but under twenty-two years of age, the minimum wage for Class V., the lowest class, in Wiltshire, as elsewhere, is 19s. a week.

    BRIGHTON OFFICE (WOMEN STAFF).
    Captain TRYONasked what steps are being taken to improve the accommodation for the women staff at the Brighton head post office, regarding which inquiry was promised some months since; and, having regard to the fact that a large number of women season assistants have been added to the staff, whether anything can be done to expedite the provision of improved accommodation?
    Mr. HOBHOUSE: I regret that it will not be practicable to effect any improvement in the retiring accommodation for the women at Brighton head post office until the new sorting office and telephone exchange are completed and occupied. A site for the new building has been acquired, but it will not be possible to
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    begin the building work in the current financial year.

  Civil Service Conditions (Co-Ordination).
  Mr. HOAREasked the Prime Minister whether he is prepared to set up a special section of the Treasury, in accordance with the recommendation of the Royal Commission on the Civil Service, for the purpose of supervising and coordinating service conditions?
  The PRIME MINISTER: This recommendation will be carefully considered along with the other recommendations of the Royal Commission.
  Mr. HOARE: Does the right hon. Gentleman expect to come to a decision before the end of the Session?
  The PRIME MINISTER'Sreply was inaudible in the Reporters' Gallery.

  House of Commons (Payment of Members).
  Mr. F. HALLasked the Prime Minister whether he will be willing to allot time for discussion of payment of Members on the Vote for the purpose if it can be proved that a considerable number of Members desire it?
  The PRIME MINISTER: I have nothing to add to the reply which my right hon. Friend the Chancellor of the Exchequer gave to the hon. Member for Salisbury on this subject on Tuesday last.
  Mr. F. HALL: Has not the right hon. Gentleman stated repeatedly that he is willing to have a discussion in the event of both sides wishing it? Will not the right hon. Gentleman, in the circumstances, say that, if a considerable number of Members desire it he will agree?
  The PRIME MINISTER: I am only following the usual course.
  Mr. KING: Is the right hon. Gentleman aware that various Members of the Opposition are finding it very hard to reconcile their practice with their professions outside the House?
  Mr. GEORGE FABER: What is the usual course?
  The PRIME MINISTER: That communication should pass through the ordinary channels.
  An HON. MEMBER: What are the ordinary channels?
  Colonel BURNasked the Prime Minister when the Whitsuntide holiday will commence and on what date the House will reassemble; and whether, in view of the opinions expressed publicly and in private, he can see his way to giving a day for discussing the payment of Members of this House?
  The PRIME MINISTER: As regards the first part of the question, I will make a statement at the end of Questions. As regards the latter part, I would refer the hon. and gallant Member to what I have recently said on the subject.
  Colonel BURN: Does the right hon. Gentleman intend to take this Vote, which has never been sanctioned by the people of the country, automatically and without discussion?
  The PRIME MINISTER: I am most anxious for it to be discussed.
  Sir WILLIAM BYLES: Will the right hon. Gentleman ascertain what his supporters desire in this matter?
  Mr. JOYNSON-HICKS: Is not the delay in giving a date for the discussion due to a reluctance to it on the part of the right hon. Gentleman's supporters?
  The PRIME MINISTER: Not the least. If a representation is made to me in the ordinary way by those who represent the Opposition, I will take care that the very first opportunity is given.

  Suffragists (Criminal Proceedings).
  Mr. PRATTasked the Prime Minister whether, in view of the decision of the Government not to take criminal proceedings against the persons involved in the recent illegal importation of arms into Ulster, a similar attitude is to be adopted towards women in this country who are charged with lawlessness in pursuit of political ends?
  The PRIME MINISTER: I do not think that the two cases are parallel.
  Mr. PRATT: Will the right hon. Gentleman not take into consideration alike the expediency and justice in the circumstances of the present time of making some concession to brave, determined women whose cause has been vindicated—
  Mr. SPEAKER: The hon. Member must give notice of that question.
  Mr. WILLIAM REDMOND: Arising out of the answer in regard to the alleged importation of arms, might I ask the right hon. Gentleman whether he can give an assurance that there is no truth in the statement, which I have seen, that persons said to be responsible for the importation of these arms are going to figure prominently in the coming Birthday Honours List?
  The PRIME MINISTER: It would be contrary to public policy to make any statement on that question.
  Captain PIRIE: Is it not the case that in the first aspect of this matter a masterly inactivity is much preferable to an awkward activity?
  Mr. GINNELL: Will the Prime Minister inform the House by what statutory or other authority he suspends part of the criminal law in Ireland at present?
  The PRIME MINISTER: The criminal law is not suspended in Ireland.
  Mr. GINNELL: Why, then, have no prosecutions been instituted?
  The PRIME MINISTER: That is always a matter for the discretion of the Executive.

  BUDGET PROPOSALS.

    LOCAL AUTHORITIES AND ROADS.
    Mr. RUPERT GWYNNEasked how much time it is proposed to give local authorities to collect and send in the necessary information in regard to roads situated in their respective areas required under the Budget proposals of the Chancellor of the Exchequer?
    Mr. LEWIS: The Road Board issued to local authorities their directions about the proposed classification of roads on 30th April. Proposals have to be sent in by them as soon as possible. No final date can be fixed at present, but it is hoped that local authorities will make their proposals promptly.
    Mr. R. GWYNNE: Is the right hon. Gentleman aware that the circular of 30th April stated that particulars should be sent in by the 30th May, and is he aware that it is quite impossible for the local authorities to do what is requested in the time?
    Mr. LEWIS: It is for the local authorities to do their best to supply the particulars for which we have asked.
    Mr. SANDERS: What about the cost? Does it fall on the local authorities?
    Mr. LEWIS: I have a question later about that.
    Mr. R. GWYNNEasked who is to bear the cost of preparing the detailed schedule, supplying maps, and taking a census of the traffic of all the public roads in England and Wales for the purpose of carrying out the Budget proposals of the Chancellor of the Exchequer; and what is the estimated cost of obtaining this information?
    Mr. LEWIS: The cost of preparing information which may assist in the classification of roads is an item of expenditure which should properly be paid by highway authorities, who will benefit by the new Grants on account of road maintenance.
    Mr. R. GWYNNE: Is the right hon. Gentleman aware that the cost will run into thousands in many counties, and will he say what right the Local Government Board or the Road Board have to tell the authorities to incur this expense?
    Mr. LEWIS: I am not aware that the matter is as stated by the hon. Gentleman.
    Mr. R. GWYNNE: Will the right hon. Gentleman say what right the Local Government Board has to tell the Road Board to get this information at enormous cost to each county?
    Mr. LEWIS: The information is necessary.
    Mr. R. GWYNNE: Owing to the unsatisfactory nature of the reply, I beg to give notice that I shall raise this question on Monday next on the Adjournment.
    Mr. SANDERS: Will the hon. Gentleman endeavour to find out what the cost will be to the various counties of acquiring this information?
    Mr. LEWIS: The information is extremely difficult to obtain, but I do not think the cost will be excessive in any case.
    Lord ROBERT CECIL: Will the hon. Gentleman say on Monday, or some other time, what authority the Road Board or the Local Government Board have, under the statute law of this country, for making these representations?
    Mr. LEWISwas understood to reply that he would consider the matter.

    INCOME TAX.
    Mr. FELLasked the Chancellor of the Exchequer what is the number of persons who make their Income Tax return at nil because all their income is taxed at the source and reaches them with the deduction of 1s. 2d. in the £ already made?
    Mr. LLOYD GEORGE: The information asked for by the hon. Member is not available.
    Mr. FELL: Would it not be possible to get it made available if it is not available at the present time?
    Mr. LLOYD GEORGE: It could only be obtained by circularising the surveyors of the country. I could not trouble them at the present moment. Perhaps the hon. Member will put a question later on in the Session.
    Mr. GEORGE TERRELL: Will these people now be put to the trouble of making detailed returns for the Budget proposals?
    Mr. LLOYD GEORGE: There will be no change as far as the Budget is concerned.
    Mr. G. TERRELL: Will they be put to the trouble of making returns?
    Mr. LLOYD GEORGE: They will be put to the same trouble in the future as in the past.

    DEATH DUTIES.
    Mr. W. THORNEasked the Chancellor of the Exchequer what was the value of the property that paid Death Duties for the financial year 1913–14; the number of adults that died; the number that died that belonged to one-third of the property; the number that belonged to two-thirds; and the number of adults that died without any property that was worth taking the trouble to pay a few shillings to obtain authority of the Inland Revenue to be legally dealt with?
    Mr. LLOYD GEORGE: The statistics for the financial year 1913–14 are not yet complete, and I am therefore only able to give approximate figures. The number of adults who died in the year was about 432,000, of whom about 340,000 left so little property that legal authority to deal with it was not sought. The value of the property that paid Death Duties in that year was £299,472,700, of which £205,682,365, in estates above £10,000, was owned by 4,417 persons, and £93,790,335, in estates below £10,000, was owned by 87,281 persons.

    EQUIVALENT GRANTS.
    Mr. O'DONNELLasked the Chancellor of the Exchequer (1) whether he will explain why, in making Grants to Scotland and Ireland equivalent to those proposed for England, the relative populations of the three countries have not been adopted as a basis of calculation, seeing that the Goschen ratio of 80, 11, and 9 has long been discarded and that the population ratio would give the figures 79¾ for England, 10½ for Scotland, and 9¾ for Ireland; and (2) why, if England and Scotland already get considerably more from the Imperial Exchequer for education than Ireland, he proposes to give further Exchequer Grants of £3,900,000 to England, £536,250 to Scotland, and only £112,500 to Ireland, whereas Ireland's share, calculated even on the Goschen basis, would be £438,750, and on the population basis would be £476,800?
    Mr. GINNELLasked what the Chancellor of the Exchequer means by his proposal to eliminate the amounts given in relief of rates in Ireland for education and police; whether the process is by way of set off or deduction; what would the figures for Ireland be on the system hitherto in operation before that process and after it; whether he calculates that the direct relief of rates, which is to average 9d. in the £ in England, will be experienced in Ireland also; and, if not, what is the estimated net direct relief of rates in Ireland in the aggregate and in the £ due to the new proposals?
    Mr. LLOYD GEORGE: I would refer the hon. Member to the explanation which I gave in my Financial Statement of the reasons for adopting the proposed method of calculating the share of Ireland in the new Grants. For the rest, I can only refer to the answer which I gave to the hon. Member for North Meath on Monday last.
    Mr. GINNELL: Will the right hon. Gentleman say whether the relief of rates in Ireland will be ninepence in the pound, as in this country?
    Mr. LLOYD GEORGE: I have not made a calculation so far as Ireland is concerned. The money will be paid over to the Irish Government, and the question of its distribution will be a matter entirely for them to deal with.
    Mr. GINNELL: Will the relief to the Irish rates in this current year be the same in Ireland as it is in this country?
    Mr. LLOYD GEORGE: The basis of calculation, as the hon. Member well knows, is purely rateable as far as Ireland is concerned. I do not know what the amount will run to in Ireland. The hon. Member knows the figures of the Irish rates, and he will find them in the Blue Book, therefore he can easily make out the calculation for himself.
    Mr. GINNELL: Will the right hon. Gentleman—
    Mr. SPEAKER: Mr. Austen Chamberlain.
    Mr. GINNELL: Mr. Speaker—
    Mr. SPEAKER: I have called upon the right hon. Gentleman the Member for East Worcestershire.
    Mr. GINNELL: I had not clone.
    Mr. SPEAKER: I had not done either.
    Mr. AUSTEN CHAMBERLAIN: In connection with this subject, will the right hon. Gentleman supply us not merely with a statement of the amount of money which is to go to Ireland out of the new taxation, but the amount that he calculates he will receive from Ireland?
    Mr. LLOYD GEORGE: Yes; I propose to give the figures with regard to that.
    Mr. GINNELL: Will the right hon. Gentleman say now whether there will be any relief to the rates in Ireland resulting from his Budget this year, and, if so, on what information does he base his opinion?
    Mr. LLOYD GEORGE: The amount to be paid to Ireland will be calculated upon the basis of four months, exactly as it is in this country. The allocation of that Grant depends upon the provisional arrangement that will be made.

    COUNTY OF SOMERSET (CONTRIBUTION TO RATES).
    Mr. SANDERSasked the Chancellor of the Exchequer in what respect the local authorities of the county of Somerset have failed in their duty; and why the contribution to their rates under the Budget should be less than half that to be received by Wiltshire?
    Mr. HERBERT LEWIS: My right hon. Friend the President of the Local Government Board cannot accept the assumption upon which the hon. Member's question is based. The introduction of the new system will necessarily alter the proportions

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    in which particular areas benefit. This is largely due to the fact that the present system is unequal.
    Mr. SANDERS: Will the right hon. Gentleman take care that his proposals do not penalise economy, and put a premium on extravagance?
    Mr. LEWIS: Yes, we shall do that.

  Motor Vehicles (Damage to Roads).
  Mr. LEACHasked the Chancellor of the Exchequer if, among his reforms, he will impose a tax upon motor omnibuses and other heavy motor vehicles, which cause expense to local authorities by breaking up the roads?
  Mr. LLOYD GEORGE: The answer is in the negative.
  Captain MURRAY: May I ask the right hon. Gentleman whether it is not a fact that the farmers and others in the country have not to bear the whole cost?
  Mr. CATHCART WASON: Will the right hon. Gentleman appoint a Departmental Commission to inquire into this matter of these large motor vehicles, which are getting heavier every year, causing enormous expenditure to the ratepayers?
  Mr. LLOYD GEORGE: The question is under consideration, but it is rather a question for my right hon. Friend the President of the Local Government Board, and the imposition of Licence Duty rather than for the Budget. There is a good deal to be said for the suggestion.

  Political Pensioners.
  Mr. LEACHasked the Chancellor of the Exchequer if, among the financial reforms he proposes to carry out, he intends to deal with the political pensions enjoyed by gentlemen whose income from fees from public companies and other sources amounts to a large sum?
  Mr. LLOYD GEORGE: The answer is in the negative. I would refer my hon. Friend to the replies which the Prime Minister has recently given on this subject.

  Contagions Diseases (Human Beings and Domestic Animals).
  Mr. C. BATHURSTasked the Chancellor of the Exchequer whether, in connection with the proposed Government subsidy for the institution of pathological laboratories, he will consider the need of research work in connection with contagious
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  diseases, such as anthrax, tuberculosis, glanders, cow-pox, and foot-and-mouth disease, which are common to human beings and domestic animals, and apply a portion of the proposed Grant towards the conduct of such research and the greater co-operation of the medical and veterinary professions in the interests of human health?
  Mr. LLOYD GEORGE: The Grants proposed are in respect of laboratories to be used primarily for purposes of expert diagnosis and not of research, but I understand that certain of the subjects mentioned by the hon. Member are engaging the attention of the Medical Research Committee.

  Main and County Roads (Exchequer Grants).
  Mr. C. BATHURSTasked the Chancellor of the Exchequer if it is proposed that the new Exchequer Grants in respect of main and county roads shall be applied solely to the maintenance of such roads, and in no way affect the existing Grants from the Road Board for the purpose of the improvement of the main roads as distinct from their maintenance; and whether he contemplates an even larger expenditure upon main roads in the future owing to the increase of industrial motor traffic, with the result that the prospective cost of road maintainance will more than absorb the proposed additional Government Grants?
  Mr. LLOYD GEORGE: The answer to the first part of the question is in the affirmative; on the second part, which is purely conjectural, I am not prepared to express an opinion.
  Mr. C. BATHURSTasked how soon it is proposed to commence a classification of roads into main, county, and district roads, respectively, and when it is estimated that such classification will be completed; and what Grants, if any, will be made in the meantime to enable local authorities to meet the growing expenditure out of local rates for the maintenance of main and county roads?
  Mr. LLOYD GEORGE: The classification is being made by the Road Board, but I fear at present I cannot name a date at which it will be complete. It is anticipated, however, that the provisional classification will be ready in time to furnish a basis on which the proportion of the additional Grants which will be voted this

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  year in aid of expenditure upon roads may be distributed to the local authorities in the course of the financial year.
  Mr. C. BATHURST: Does that mean that some of the Grants will be available before the end of the present year?
  Mr. LLOYD GEORGE: The Grants from the 1st December will be available this year, and that will be for about four months of the year.
  Captain MURRAY: I would like to ask whether the Grants will be made on the recommendation of the Treasury or by the Road Board?
  Mr. LLOYD GEORGE: It is the Road Board that will adjudicate upon the question of classification, and they will make a provisional classification for the purposes of distribution this year, and we shall certainly accept their recommendation in that respect.
  Mr. G. TERRELL: I would like to ask whether the local authorities will be consulted in connection with the proposed classification?
  Mr. LLOYD GEORGE: Of course I cannot answer for the Road Board, but I have no doubt they will consult the local authorities upon a matter of such considerable importance to the localities.
  Mr. R. GWYNNE: Will the right hon. Gentleman say whether the whole of the cost will be borne by the local authorities, such as the taking of the census of the roads?
  Mr. LLOYD GEORGE: I would rather have a question put down upon that subject.

  Public Trustee.
  Mr. F. WHYTEasked the Secretary to the Treasury whether it is competent for the Treasury to transfer the office of Public Trustee to the Civil Service by an administrative act without Parliamentary sanction?
  The FINANCIAL SECRETARY to the TREASURY (Mr. Montagu): Yes, Sir. Under the Public Trustee Act, 1906, and the Order in Council of 10th January, 1910, the Lord Chancellor has power to recommend, and the Treasury to sanction, the establishment of the staff of the Public Trustee on Civil Service lines, subject, of course, to the salaries being duly voted by Parliament.
  Mr. RENDALL: Is there any intention of doing that?
  Mr. MONTAGU: That does not arise.
  Mr. JOYNSON-HICKS: Will the Secretary to the Treasury give an undertaking that it shall not be done without some debate in this House?
  Mr. MONTAGU: I would not like to give an undertaking about it without notice; there is no suggestion in the question that it should be done.

  Lord Murray Committee (Expenses).
  Mr. JAMES HOPEasked by what Vote the expenses of the Committee of the House of Lords on the charges against Lord Murray of Elibank will be defrayed?
  Mr. MONTAGU: The expenses of the Committee, other than the expense of printing, which is borne by the Vote for Stationery and Printing, will be defrayed from the Vote for the House of Lords Offices.

  Manufactured Goods (Exports).
  Major ARCHER-SHEEasked the President of the Board of Trade if he will give the value of the export of wholly or partly manufactured goods from the United Kingdom to the United States in the first quarters, January to March, of the years 1913 and 1914, respectively?
  Mr. BURNS: The total value of the produce and manufactures of the United Kingdom exported to the United States of America in the first quarter of 1914 was £9,961,000, as against £7,422,000 in the first quarter of 1913. The values of the exports of goods wholly and mainly manufactured to particular destinations are only compiled for the year as a whole, and are not available for a single quarter.

  Education Grants (Scotland).
  Major HOPEasked the Secretary for Scotland whether he is aware that, owing to the reduction in the Scottish Education Fund Grants payable to secondary education committees, many of these committees have been unable to pay during the past year more than half the usual Grants under Section 17 (9) of the Education (Scotland) Act, 1908, in aid of the teaching staff in small schools; and, in view of the fact that the residue Grant under Section 17 (11) has entirely disappeared, will he say what steps he proposes to take to make good this loss to

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  Scottish schools in general and to small schools in particular during the past financial year?
  The SECRETARY for SCOTLAND (Mr. McKinnon Wood): I would refer the hon. and gallant Member to the answer which I gave on Tuesday to my hon. Friend the Member for Perth.
  Major HOPE: Does the right hon. Gentleman propose to make good the loss which has been caused in the course of the last two years?
  Mr. McKINNON WOOD: No; they must look forward to a happy future.

  BRITISH ARMY.

    KING'S REGULATIONS.
    Major HOPEasked the Secretary of State for War whether he is aware that nearly every page of the 1912 edition of the King's Regulations has been amended by various subsequent Army Orders, and that consequently the price of a corrected copy is 17s. 6d.; and if he will state when he proposes issuing a new edition of the King's Regulations, and so enabling officers, non-commissioned officers and men to become acquainted with them at the reasonable cost of 1s. 6d., the published price of the book?
    The UNDER-SECRETARY of STATE for WAR (Mr. Tennant): There have been numerous amendments, but it is not, I think, the case that nearly every page has been altered in some respect. Amendment slips are supplied free and copies of the book, together with all the amendments which have been reprinted, can be bought from the Stationery Office or its agents at the original published price. It is recognised, however, that the accumulation of unincorporated amendments should have limits, and a new edition of the King's Regulations is in course of being produced.
    Major HOPE: How long is the "course of production" likely to be?
    Mr. TENNANT: It is not a short process, as no doubt the hon. Member is aware. When I say "in course of being produced," I do not mean that it is in the hands of the printers; but I hope that the new edition will be out some time early next year.
    Major HOPE: Can the hon. Gentleman tell me where I can get a corrected copy for less than 17s. 6d.?
    Mr. TENNANT: I will give the hon. and gallant Gentleman such information as I have on that point.

    SMALL ARMS AMMUNITION.
    Mr. COURTHOPEasked whether the reduced provision for rifles and small arms ammunition in the Estimates for the current year is due to an intention to reduce stocks held in reserve or to smaller requirements for current use; if the latter, in what way the saving in ammunition is to be effected; and whether the reserve stocks required by the Mowatt Committee are being fully maintained?
    Mr. TENNANT: The reduced provision is not due to either of the causes mentioned, but to the fact that last year's Estimates included special provision for resighting rifles for the Regular Army and Special Reserve and for increasing the reserve of small-arm ammunition. The authorised reserve stocks are being fully maintained.
    Mr. R. M'NEILL: Will the hon. Gentleman say whether the reduced provision is due to any expectation on the part of the Government of being able to buy some arms second-hand in the near future?
    Mr. TENNANT: The answer to that is in the negative.
    Mr. W. REDMOND: Very second-hand!

    TERRITORIAL FORCE.
    Mr. F. HALLasked the present number of officers, non-commissioned officers, and men in the Territorial Force, and the number of each class who have respectively joined and left the service during the present year?
    Mr. TENNANT: The strength on 1st April, which is the latest date for which Returns are available, was: Officers, 9,465; non-commissioned officers and men, 251,838. During the first quarter of the year 390 officers joined and 220 left. The corresponding figures for non-commissioned officers and men are 27,450 and 15,367. Separate figures for non-commissioned officers and for men cannot be given.

  Elementary School Teachers (Pensions).
  Mr. BRIDGEMANasked the President of the Board of Education if he can state now what he will be able to do to augment the pensions of teachers who retired from elementary schools before 1912?
  The PRESIDENT of the BOARD of EDUCATION (Mr. J. A. Pease): I regret to say that the Departmental Committee have reported that the money which was placed at my disposal was insufficient to provide any benefits beyond those secured by the Act of 1912.
  Mr. BRIDGEMAN: Was it difficult then to secure these benefits?
  Mr. PEASE: Certainly, and for some years to come.
  Mr. BRIDGEMAN: Is there any prospect of any other fund being used for the purpose?
  Mr. PEASE: I am in communication with the Treasury, but, as I am informed that one of their representatives was on the Committee, I have nothing further to communicate at present.
  Mr. CROOKS: Promises have been given from time to time that these pensioners would be considered. Have we to lose all hope of their getting anything?
  Mr. PEASE: In the event of their being any margin after the actuarial examination of the figures, they will have a share of that margin. If there is no margin, there is nothing to share.
  Mr. CROOKS: Increase the Grant then!

  Local Education Authorities (Loan Charges).
  Mr. BRIDGEMANasked the President of the Board of Education whether it is proposed to give Government Grants towards paying the loan charges incurred by local education authorities?
  Mr. PEASE: If the proposed Consolidated Grant for elementary education is calculated on the lines suggested by the Kemp Committee, it will be calculated partly on the actual expenditure by local education authorities, in which expenditure loan charges are one of the items.
  Mr. BRIDGEMAN: If that is the case, would it not be necessary to amend the Education Act to give a Grant of money?
  Mr. PEASE: That is a matter on which I should not like to give an answer offhand.

  Thorpe Church School (Religious Teaching).
  Mr. ELLIS DAVIESasked the President of the Board of Education whether he is aware that twenty-six children from
  1292
  the village of Thorpe, Surrey, have been withdrawn from the Thorpe Church of England school on account of the parents' objection to the religious teaching given at the school, and that in consequence the children, where conveyances are not provided at private expense, are compelled to walk several miles to attend school; and whether he will institute an inquiry into the matter?
  Mr. PEASE: I am aware of the withdrawal of children referred to by the hon. Member, but I have no information as to the exact distances the children have to travel from their homes to the Egham Saint Anne's Heath council school, which I understand they are attending. Any children whose parents object to the religious instruction given in the school can be withdrawn from that instruction under the Conscience Clause, and unless that Clause is violated I have no power to intervene.
  Mr. KING: Is the right hon. Gentleman aware that when the children are withdrawn they are put in a cloak room or sent to the playground until the instructions are over, and does he expect that sort of thing to be tolerated by their parents?

  Mental Deficiency (Register and Card Index).
  Mr. YEOasked the Secretary of State for the Home Department whether the Board of Control has yet prescribed the form of register and card index which, by his provisional Regulations 10 and 11 under the Mental Deficiency Act, local authorities are required to keep in connection with the ascertainment of defectives?
  The SECRETARY of STATE for the HOME DEPARTMENT (Mr. McKenna): The forms in question are now being settled, and it is hoped that they will be placed on sale in a few days.
  Mr. YEO: Will the right hon. Gentleman take care that the county councils which have to deal with this matter should have it as speedily as possible?
  Mr. McKENNA: Yes, Sir.

  Pit Ponies (Inspections).
  Mr. BUTCHERasked the Secretary of State for the Home Department whether he will grant the Return standing in the name of the hon. and learned Member for York?

  1293
  [Return for the year ending the 31st day of December, 1913, showing:—

  (1) The number of mines in which inspections of the animals employed therein have been made by (a) special inspectors under the Coal Mines Act, 1911, and (b) ordinary inspectors;

  (2) The number of cases in which breaches of the Regulations in the Third Schedule to the Coal Mines Act, 1911, have been discovered;

  (3) The number of prosecutions for breach of these Regulations which have been instituted against owners, agents, or managers of mines or against horsekeepers at the instance of inspectors or as the result of their inspections; and

  (4) The number of convictions which have been obtained on such prosecutions.]

  Mr. McKENNA: The divisional and district inspectors of mines have been instructed to deal fully in their annual reports, which are now being prepared, with the question of the observance of the regulations for the protection of animals, and it will be possible in the reports to give most of the information asked for by the hon. and learned Member, but some of the particulars may not be available. In these circumstances, I hope he will not press for the Return, as the preparation of it would take the inspectors from their ordinary work.
  Mr. BUTCHER: Can the right hon. Gentleman give me the Return of the previous year pending the Report of the present year—the Returns that have been compiled from the previous Reports—it would be much more convenient?
  Mr. McKENNA: I will consider that point, but, as regards the immediate Return, the inspectors are now engaged upon their Reports, which contain the great bulk of the information the hon. Member asks for.
  Mr. BUTCHER: When can we get the Return?
  Mr. McKENNA: I cannot say the date, but I do not think it will be very long delayed.

  ROYAL NAVY.

    PACIFIC.
    Mr. F. HALLasked the First Lord of the Admiralty if his attention has been called to the recent speech by the New Zealand Premier in which he stated that the Anglo-Japanese Alliance
    1294
    had not ensured the safety of Australasia; that if Great Britain were not able to perform her agreement for the protection of Imperial interests in the Pacific, and to supply New Zealand with two cruisers of the Bristol class, New Zealand would be compelled to build one herself; if he will state the terms of the agreement referred to; and whether any communication has been made to the New Zealand Government as to the Government's intentions in the matter?
    The FIRST LORD of the ADMIRALTY (Mr. Churchill): As regards the terms of the arrangements made with New Zealand I must refer the hon. Member to the answer given him last Thursday. I have seen from time to time Press reports of the speeches of New Zealand Ministers on this subject, and if the New Zealand Government decide to make further proposals before a Conference is held, the Admiralty will, of course, give them immediate attention.
    Mr. F. HALL: May we expect in the near future the usual repudiation?
    Sir C. KINLOCH-COOKE: Is the right hon. Gentleman aware that the Government of Australia and the Government of the Dominion of Now Zealand are totally opposed to the speech already made with regard to the question of the naval defences of the Empire?

  Hops Substitutes Bill.
  Mr. COURTHOPEasked the President of the Board of Agriculture if he will state when the Hops Substitutes Bill will be proceeded with?
  The PRESIDENT of the BOARD of AGRICULTURE (Mr. Runciman): I cannot name a date.

  Small Holdings.
  Mr. SANDERSasked the President of the Board of Agriculture in what counties it is the practice of the county council to redeem Land Tax on land bought for the purpose of small holdings; and in how many counties the council decline to do so?
  Mr. RUNCIMAN: It is the usual practice in all counties for the councils to redeem any Land Tax charged on land purchased for small holdings on the ground that the establishment of small holdings is likely to increase the assessment.

  1295
  The Somerset County Council have recently represented to the Board that redemption is unnecessary in cases where no expenditure will be made on equipment, and the Board, though they are of opinion that as a general rule redemption is desirable, are prepared to deal with each case on its merits.
  Mr. SANDERS: Is that the practice in other counties or not?
  Mr. RUNCIMAN: Yes, Sir; it is almost the universal practice with very few exceptions.
  Mr. T. E. HARVEYasked the President of the Board of Agriculture (1) whether his attention has been called to the fact that at the end of last year, in the counties of Hereford and Salop, the number of allotment holders, tenants of the local authorities, was 137 and 126, respectively, as compared with 1,014 in Worcestershire and 1,568 and ten associations in Warwickshire; whether he will inquire as to what information, if any, the Small Holdings Commissioner for the district has received as to the existence of a demand for allotments in the two former counties which has been communicated by him to the local councils concerned; and (2) whether he will inquire from the allotment authorities in Herefordshire and Shropshire if they have taken steps to ascertain whether there is a demand for allotments in their respective districts which cannot be obtained by voluntary agreement; and whether the councils for the two counties have taken steps to ascertain the extent to which there is a demand for allotments in the several urban districts (other than boroughs) and rural parishes in the county, or would be a demand if suitable land were available; the extent to which it is reasonably practicable to satisfy any such demand; and as to what was the result of the inquiries, if made?
  Mr. RUNCIMAN: The number of allotments held under the local authorities in the counties named is correctly stated, except that the figure for Salop should be 123. Returns are obtained annually by the Board from all allotment authorities, and from the returns for 1913 it appears that at the end of that year there were six unsatisfied applicants in Herefordshire and two in Salop. When the Act of 1908 came into operation the two county councils made inquiry, but the result
  1296
  showed that the unsatisfied demand was very small, and no further action on their part seemed necessary. In some cases the county councils have assisted the parish councils to obtain land for allotments.

  Mussel Fishery, Cardigan Bay.
  Mr. ELLIS DAVIESasked the President of the Board of Agriculture when the promised public inquiry by the Board of Agriculture and Fisheries into the provisions of the draft Order for the improvement, maintenance, and regulation of a mussel fishery in Cardigan Bay will be held?
  Mr. RUNCIMAN: The inquiry cannot, under the Statute, be held until towards the end of next month. The exact date must depend upon the convenience of persons interested and other circumstances, but there will be no avoidable delay. I am communicating with my hon. Friend on the subject.

BUSINESS OF THE HOUSE.

  WHITSUNTIDE RECESS.
  Mr. BONAR LAW: May I ask the Prime Minister if he can now tell us what period he proposes for the Whitsuntide Recess, and what business will be taken before it?
  The PRIME MINISTER: On Monday, we shall take the Report of the Money Resolution of the Established Church (Wales) Bill, and the Committee stage of that Bill, and after that, the Third Reading of the Bill, which we hope we shall be able to conclude on Tuesday evening.
  On Wednesday, we shall take the Government of Ireland Money Resolution.
  On Thursday, the Report of the Money Resolution and the formal stage in Committee, and we shall thereafter proceed with the Third Reading.
  We hope to be able to move the adjournment for the Whitsuntide Recess on the Wednesday of the following week. Of course, that depends upon the progress we make. If so, we shall ask the House to resume on Tuesday, 9th June.
  Mr. CASSEL: Has the right hon. Gentleman borne in mind that the Second Reading of the Finance Bill must, under the Provisional Collection of Taxes Act, be disposed of before the Wednesday adjournment, and is it the right hon. Gentleman's intention to allow a full opportunity for a discussion of that very important measure?
  The PRIME MINISTER: I think the hon. and learned Gentleman is not correct there.
  Mr. BONAR LAW: Do I understand from the announcement of the right hon. Gentleman that the Third Reading of the Home Rule Bill will be continued on Monday and Tuesday of the following week?
  The PRIME MINISTER: If it is so desired.
  Mr. CASSEL: Is the right hon. Gentleman not aware that under the Provisional Collection of Taxes Act the Second Reading
  of the Finance Bill must be passed within the twenty days on which the House sits after the first Resolution of the 4th May, and, if he makes this arrangement, there would only be one day left for taking the whole of the Second Reading of the Finance Bill?
  The PRIME MINISTER: It counts after the first Resolution is reported.
  Mr. JAMES HOGGE: Will the right hon. Gentleman bear in mind that the 27th is Derby Day, and will he attempt to bring the Resolution forward on the 26th?
  Mr. CHAMBERLAIN: I wish to ask a question in relation to the notice for a Return which I placed on the Paper some days ago, and which stands there to-day, I understand, from a communication just received from the Chancellor of the Exchequer, that he is unwilling to grant the Return in the form in which I have moved it on the ground that he and the Board of Inland Revenue of to-day do not accept the basis of calculation adopted by the Board of Inland Revenue under the Prime Minister in 1906. What I wish to ask the Chancellor of the Exchequer is whether he does not think that is a matter for argument, and whether he could not meet me by giving the Return in the form in which I asked for it, at the same time adding the form in which he would prefer to put it, and attaching any explanation which the Board of Inland Revenue think necessary?
  Mr. LLOYD GEORGE: As long as the right hon. Gentleman accepts the responsibility for the basis of calculation, certainly I am prepared to give it on that basis, and allow him to have it.
  Mr. CHAMBERLAIN: I prefer to have both calculations. I am quite prepared to take the responsibility of asking for the Return in the form presented by the then Chairman of the Inland Revenue at the time when the Prime Minister was Chancellor of the Exchequer.
  Motion made, and Question proposed, "That the Business of Ways and Means have precedence this day of the Business of Supply."—[The Prime Minister.]
  The House divided: Ayes, 255; Noes, 234.

  Division No. 103.]

  AYES.

  [3.50 p.m.

  Abraham, William (Dublin, Harbour)

  Allen, Arthur A. (Dumbartonshire)

  Balfour, Sir Robert (Lanark)

  Addison, Dr. Christopher

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

  Baring, Sir Godfrey (Barnstaple)

  Adkins, Sir W. Ryland D.

  Arnold, Sydney

  Barnes, George N.

  Agnew, Sir George William

  Asquith, Rt. Hon. Herbert Henry

  Beale, Sir William Phipson

  Ainsworth, John Stirling

  Baker, Harold T. (Accrington)

  Beck, Arthur Cecil

  Alden, Percy

  Baker, Joseph Allen (Finsbury, E.)

  Benn, W. W. (T. Hamlets, St. George)

  Bentham, George Jackson

  Hodge, John

  Pearce, William (Limehouse)

  Bethell, Sir J. H.

  Hogge, James Myles

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

  Birrell, Rt. Hon. Augustine

  Holmes, Daniel Turner

  Phillips, John (Longford, S.)

  Boland, John Plus

  Holt, Richard Durning

  Pirie, Duncan V.

  Booth, Frederick Handel

  Howard, Hon. Geoffrey

  Pollard, Sir George H.

  Bowerman, Charles W.

  Hughes, Spencer Leigh

  Ponsonby, Arthur A. W. H.

  Boyle, Daniel (Mayo, North)

  John, Edward Thomas

  Pratt, J. W.

  Brady, Patrick Joseph

  Jones, Rt. Hon. Sir D. Brynmor (Swansea)

  Price, C. E. (Edinburgh, Central)

  Bryce, J. Annan

  Jones, Henry Haydn (Merioneth)

  Priestley, Sir Arthur (Grantham)

  Burns, Rt. Hon. John

  Jones, J. Towyn (Carmarthen, East)

  Primrose, Hon. Neil James

  Burt, Rt. Hon. Thomas

  Jones, Leif (Notts, Rushcliffe)

  Pringle, William M. R.

  Byles, Sir William Pollard

  Jones, William (Carnarvonshire)

  Radford, George Heynes

  Cawley, Harold T. (Lancs., Heywood)

  Jones, William S. Glyn-(Stepney)

  Raffan, Peter Wilson

  Chapple, Dr. William Allen

  Jowett, Frederick William

  Raphael, Sir Herbert H.

  Churchill, Rt. Hon. Winston S.

  Joyce, Michael

  Rea, Rt. Hon. Russell (South Shields)

  Clancy, John Joseph

  Kelly, Edward

  Rea, Walter Russell (Scarborough)

  Clough, William

  Kennedy, Vincent Paul

  Reddy, Michael

  Collins, Godfrey P. (Greenock)

  Kenyon, Barnet

  Redmond, John E. (Waterford)

  Collins, Sir Stephen (Lambeth)

  Kilbride, Denis

  Redmond, William (Clare, E.)

  Condon, Thomas Joseph

  King, Joseph

  Redmond, William Archer (Tyrone, E.)

  Cornwall, Sir Edwin A.

  Lambert, Rt. Hon. G. (Devon, S. Molton)

  Rendall, Athelstan

  Cotton, William Francis

  Lambert, Richard (Wilts, Cricklade)

  Richardson, Thomas (Whitehaven)

  Crooks, William

  Lardner, James C. R.

  Roberts, Charles H. (Lincoln)

  Crumley, Patrick

  Law, Hugh A. (Donegal, West)

  Roberts, George H. (Norwich)

  Cullinan, John

  Lawson, Sir W. (Cumb'rld, Cockerm'th)

  Robertson, Sir G. Scott (Bradford)

  Davies, Ellis William (Eifion)

  Leach, Charles

  Robertson, John M. (Tyneside)

  Davies, Timothy (Lincs., Louth)

  Levy, Sir Maurice

  Robinson, Sidney

  Davies, M. Vaughan-(Cardiganshire)

  Lewis, Rt. Hon. John Herbert

  Roch, Walter F. (Pembroke)

  Dawes, James Arthur

  Lough, Rt. Hon. Thomas

  Roche, Augustine (Louth)

  Delany, William

  Lundon, Thomas

  Roe, Sir Thomas

  Denman, Hon. Richard Douglas

  Lyell, Charles Henry

  Rowlands, James

  Devlin, Joseph

  Lynch, Arthur Alfred

  Runciman, Rt. Hon. Walter

  Dewar, Sir J. A.

  Macdonald, J. Ramsay (Leicester)

  Russell, Rt. Hon. Thomas W.

  Dickinson, Rt. Hon. Willoughby H.

  Macdonald, J. M. (Falkirk Burghs)

  Samuel, J. (Stockton-on-Tees)

  Dillon, John

  McGhee, Richard

  Scanlan, Thomas

  Donelan, Captain A.

  Maclean, Donald

  Scott, A. MacCallum (Glas., Bridgeton)

  Doris, William

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

  Seely, Rt. Hon. Colonel J. E. B.

  Duffy, William J.

  Macpherson, James Ian

  Sheehy, David

  Duncan, C. (Barrow-in-Furness)

  MacVeagh, Jeremiah

  Sherwell, Arthur James

  Duncan, J. Hastings (Yorks, Otley)

  M'Callum, Sir John M.

  Smith, Albert (Lancs., Clitheroe)

  Edwards, Sir Francis (Radnor)

  McKenna, Rt. Hon. Reginald

  Smith, H. B. Lees (Northampton)

  Edwards, John Hugh (Glamorgan, Mid)

  M'Laren, Hon. F. W. S. (Lincs., Spalding)

  Smyth, Thomas F. (Leitrim, S.)

  Esmonde, Dr. John (Tipperary, N.)

  M'Micking, Major Gilbert

  Snowden, Philip

  Esmonde, Sir Thomas (Wexford, N.)

  Marks, Sir George Croydon

  Soames, Arthur Wellesley

  Essex, Sir Richard Walter

  Marshall, Arthur Harold

  Sutherland, John E.

  Falconer, James

  Meehan, Francis E. (Leitrim, N.)

  Taylor, John W. (Durham)

  Farrell, James Patrick

  Meehan, Patrick J. (Queen's Co., Leix)

  Taylor, Theodore C. (Radcliffe)

  Fenwick, Rt. Hon. Charles

  Millar, James Duncan

  Taylor, Thomas (Bolton)

  Ffrench, Peter

  Molloy, Michael

  Tennant, Harold John

  Field, William

  Molteno, Percy Alport

  Toulmin, Sir George

  Fitzgibbon, John

  Montagu, Hon. E. S.

  Trevelyan, Charles Philips

  Flavin, Michael Joseph

  Mooney, John J.

  Verney, Sir Harry

  Furness, Sir Stephen Wilson

  Morgan, George Hay

  Ward, John (Stoke-upon-Trent)

  Gelder, Sir W. A.

  Morrell, Philip

  Warner, Sir Thomas Courtenay

  George, Rt. Hon. D. Lloyd

  Morison, Hector

  Wason, Rt. Hon. E. (Clackmannan)

  Gill, A. H.

  Morton, Alpheus Cleophas

  Wason, John Cathcart (Orkney)

  Ginnell, Laurence

  Muldoon, John

  Webb, H.

  Gladstone, W. G. C.

  Munro, Rt. Hon. Robert

  White, J. Dundas (Glasgow, Tradeston)

  Glanvilie, Harold James

  Murphy, Martin J.

  White, Patrick (Meath, North)

  Goldstone, Frank

  Murray, Captain Hon. Arthur C.

  Whitehouse, John Howard

  Greig, Colonel J. W.

  Nannetti, Joseph P.

  Whyte, Alexander F. (Perth)

  Griffith, Ellis Jones

  Needham, Christopher T.

  Wilkie, Alexander

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

  Nolan, Joseph

  Williams, Aneurin (Durham, N. W.)

  Gwynn, Stephen Lucius (Galway)

  Nugent, Sir Walter Richard

  Williams, John (Glamorgan)

  Hackett, John

  Nuttall, Harry

  Williams, Llewelyn (Carmarthen)

  Harcourt, Rt. Hon. Lewis (Rossendale)

  O'Brien, Patrick (Kilkenny)

  Williams, Penry (Middlesbrough)

  Harcourt, Robert V. (Montrose)

  O'Connor, John (Kildare, N.)

  Williamson, Sir Archibald

  Harmsworth, Cecil (Luton, Beds)

  O'Connor, T. P. (Liverpool)

  Wilson, Hon. G. G. (Hull, W.)

  Harvey, A. G. C. (Rochdale)

  O'Doherty, Philip

  Wilson, John (Durham, Mid)

  Harvey, T. E. (Leeds, West)

  O'Donnell, Thomas

  Wilson, Rt. Hon. J. W. (Worcs., N.)

  Haslam, Lewis (Monmouth)

  O'Dowd, John

  Wilson, W. T. (Westhoughton)

  Havelock-Allan, Sir Henry

  O'Kelly, Edward P. (Wicklow, W.)

  Winfrey, Sir Richard

  Hayden, John Patrick

  O'Kelly, James (Roscommon, N.)

  Wing, Thomas Edward

  Hazleton, Richard

  O'Malley, William

  Wood, Rt. Hon. T. McKinnon (Glasgow)

  Helme, Sir Norval Watson

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

  Yeo, Alfred William

  Henry, Sir Charles

  O'Shaughnessy, P. J.

  Young, William (Perthshire, East)

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

  O'Shee, James John

  Yoxall, Sir James Henry

  Higham, John Sharp

  O'Sullivan, Timothy

  Hinds, John

  Palmer, Godfrey Mark

  TELLERS FOR THE AYES.—Mr.

  Hobhouse, Rt. Hon. Charles E. H.

  Parker, James (Halifax)

  Illingworth and Mr. Gulland.

  NOES.

  Amery, L C. M. S.

  Anstruther-Gray, Major William

  Ashley, Wilfrid W.

  Anson, Rt. Hon. Sir William R.

  Archer-Shee, Major Martin

  Astor, Waldorf

  1316

  1317

  Baird, John Lawrence

  Gardner, Ernest

  Nield, Herbert

  Baker, Sir Randolf L. (Dorset, N.)

  Gibbs, G. A.

  O'Neill, Hon. A. E. B. (Antrim, Mid)

  Baldwin, Stanley

  Gilmour, Captain John

  Orde-Powlett, Hon. W. G. A.

  Balfour, Rt. Hon. A. J. (City, London)

  Glazebrook Captain Philip K.

  Ormsby-Gore, Hon. William

  Banbury, Sir Frederick George

  Goldman, C. S.

  Parker, Sir Gilbert (Gravesend)

  Banner, Sir John S. Harmood-

  Goldsmith, Frank

  Parkes, Ebenezer

  Baring, Major Hon. Guy V. (Winchester)

  Gordon, Hon. John Edward (Brighton)

  Pease, Herbert Pike (Darlington)

  Barlow, Montague (Salford, South)

  Goulding, Edward Alfred

  Peel, Lieut.-Colonel R. F.

  Barnston, Harry

  Grant, J. A.

  Perkins, Walter F.

  Barrie, H. T.

  Greene, Walter Raymond

  Pole-Carew, Sir R.

  Bathurst, Hon. A. B. (Glouc. E.)

  Gretton, John

  Pollock, Ernest Murray

  Bathurst, Charles (Wilts, Wilton)

  Guinness, Hon. Rupert (Essex, S. E.)

  Pryce-Jones, Colonel E.

  Beach, Hon. Michael Hugh Hicks

  Guinness, Hon. W. E. (Bury S. Edmunds)

  Quilter, Sir William Eley C.

  Beckett, Hon. Gervase

  Gwynne, R. S. (Sussex, Eastbourne)

  Randies, Sir John S.

  Benn, Arthur Shirley (Plymouth)

  Haddock, George Bahr

  Ratcliff, R. F.

  Benn, Ion Hamilton (Greenwich)

  Hall, D. B. (Isle of Wight)

  Rawlinson, John Frederick Peel

  Bennett-Goldney, Francis

  Hall, Frederick (Dulwich)

  Rawson, Colonel R. H.

  Bigland, Alfred

  Hamersley, Alfred St. George

  Remnant, James Farquharson

  Bird, Alfred

  Hamilton, C. G. C. (Ches., Altrincham)

  Roberts, S. (Sheffield, Ecclesall)

  Blair, Reginald

  Hardy, Rt. Hon. Laurence

  Ronaldshay, Earl of

  Boles, Lieut.-Colonel Dennis Fortescue

  Harris, Henry Percy

  Rothschild, Lionel de

  Boscawen, Sir Arthur S. T. Griffith-

  Harrison-Broadley, H. B.

  Royds, Edmund

  Boyle, William (Norfolk, Mid)

  Helmsley, Viscount

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

  Boyton, James

  Henderson, Major H. (Berks, Abingdon)

  Salter, Arthur Clavell

  Brassey, H. Leonard Campbell

  Henderson, Sir A. (St. Geo., Har. Sq.)

  Samuel, Sir Harry (Norwood)

  Bridgeman, William Clive

  Herbert, Hon. A. (Somerset, S.)

  Samuel, Samuel (Wandsworth)

  Bull, Sir William James

  Hewins, William Albert Samuel

  Sanders, Robert Arthur

  Burdett-Coutts, W.

  Hibbert, Sir Henry F.

  Sanderson, Lancelot

  Burgoyne, A. H.

  Hill-Wood, Samuel

  Sandys, G. J.

  Burn, Colonel C. R.

  Hoare, Samuel John Gurney

  Sassoon, Sir Philip

  Butcher, John George

  Hohler, Gerald Fitzroy

  Scott, Sir S. (Marylebone, W.)

  Campbell, Captain Duncan F. (Ayr, N.)

  Hope, Harry (Bute)

  Sharman-Crawford, Colonel R. G.

  Campbell, Rt. Hon. J. (Dublin Univ.)

  Hope, James Fitzalan (Sheffield)

  Smith, Rt. Hon. F. E. (L'pool, Walton)

  Campion, W. R.

  Hope, Major J. A. (Midlothian)

  Smith, Harold (Warrington)

  Carlile, Sir Edward Hildred

  Horne, E. (Surrey, Guildford)

  Spear, Sir John Ward

  Carson, Rt. Hon. Sir Edward H.

  Horner, Andrew Long

  Stanier, Beville

  Cassel, Felix

  Hume-Williams, William Ellis

  Stanley, Hon. Arthur (Ormskirk)

  Castlereagh, Viscount

  Hunt, Rowland

  Stanley, Major Hon. G. F. (Preston)

  Cator, John

  Hunter, Sir Charles Rodk.

  Starkey, John R.

  Cautley, H. S.

  Ingleby, Holcombe

  Staveley-Hill, Henry

  Cave, George

  Jardine, Ernest (Somerset, East)

  Swift, Rigby

  Cecil, Evelyn (Aston Manor)

  Jessel, Captain H. M.

  Sykes, Alan John (Ches., Knutsford)

  Cecil, Lord Hugh (Oxford University)

  Joynson-Hicks, William

  Talbot, Lord Edmund

  Cecil, Lord R. (Herts, Hitchin)

  Kerr-Smiley, Peter Kerr

  Terrell, George (Wilts, N. W.)

  Chaloner, Colonel R. G. W.

  Kerry, Earl of

  Terrell, Henry (Gloucester)

  Chamberlain, Rt. Hon. J. A. (Worc'r., E.)

  Keswick, Henry

  Thompson, Robert (Belfast, North)

  Chaplin, Rt. Hon. Henry

  Kinloch-Cooke, Sir Clement

  Thomson, W. Mitchell-(Down, North)

  Clay, Captain H. H. Spender

  Knight, Captain E. A.

  Thynne, Lord Alexander

  Clive, Captain Percy Archer

  Kyffin-Taylor, G.

  Touche, George Alexander

  Clyde, J. Avon

  Lane-Fox, G. R.

  Tryon, Captain George Clement

  Coates, Major Sir Edward Feetham

  Larmor, Sir J.

  Tullibardine, Marquess of

  Cooper, Sir Richard Ashmole

  Lawson, Hon. H. (T. Hmts., Mile End)

  Valentia, Viscount

  Courthope, George Loyd

  Lee, Arthur Hamilton

  Walker, Colonel William Hall

  Craig, Ernest (Cheshire, Crewe)

  Lewisham, Viscount

  Walrond, Hon. Lionel

  Craig, Norman (Kent, Thanet)

  Lloyd, George Ambrose (Stafford, W.)

  Ward, A. S. (Herts, Watford)

  Craik, Sir Henry

  Lloyd, George Butler (Shrewsbury)

  Warde, Colonel C. E. (Kent, Mid)

  Crichton-Stuart, Lord Ninian

  Locker-Lampson, G. (Salisbury)

  Watson, Hon. W.

  Croft, H. P.

  Locker-Lampson O. (Ramsey)

  Weigall, Captain A. G.

  Currie, George W.

  Lockwood, Rt. Hon. Lt.-Colonel A. R.

  Weston, Colonel J. W.

  Dairymple, Viscount

  Lowe, Sir F. W. (Birm., Edgbaston)

  Wheler, Granville C. H.

  Dalziel, Davison (Brixton)

  MacCaw, William J. MacGeagh

  White, Major G. D. (Lancs., Southport)

  Denison-Pender, J. C.

  Mackinder Halford J.

  Williams, Colonel R. (Dorset, W.)

  Denniss, E. R. B.

  Macmaster, Donald

  Willoughby, Major Hon. Claud

  Dickson, Rt. Hon. C. Scott

  M'Calmont, Major Robert C. A.

  Wills, Sir Gilbert

  Dixon, C. H.

  M'Neill, Ronald (Kent, St. Augustine's)

  Wilson, A. Stanley (Yorks, E. R.)

  Du Cros, Arthur Philip

  Magnus, Sir Philip

  Wilson, Captain Leslie O. (Reading)

  Duncannon, Viscount

  Malcolm, Ian

  Wilson, Maj Sir M. (Bethnai Green, S. W.)

  Du Pre, W. Baring

  Mason, James F. (Windsor)

  Wolmer, Viscount

  Eyres-Monsell, Bolton M.

  Meysey-Thompson, E. C.

  Wood, Hon. E. F. L. (Yorks, Ripon)

  Faber, George Denison (Clapham)

  Mills, Hon. Charles Thomas

  Wood, John (Stalybridge)

  Falle, Bertram Godfray

  Morrison-Bell, Major A. C. (Honiton)

  Worthington Evans, L.

  Fell, Arthur

  Mount, William Arthur

  Wright, Henry Fitzherbert

  Finlay, Rt. Hon. Sir Robert

  Neville, Reginald J. N.

  Yate, Colonel Charles Edward

  Fisher, Rt. Hon. W. Hayes

  Newdegate, F. A.

  Younger, Sir George

  Fitzroy, Hon. Edward A.

  Newman, John R. P.

  Fleming, Valentine

  Newton, Harry Kottingham

  TELLERS FOR THE NOES.—Mr.

  Foster, Philip Staveley

  Nicholson, William G. (Petersfield)

  Mildmay and Major Gastrell.

  Ordered, "That the Proceedings upon the Reports of Ways and Means (4th May and 11th May), if under discussion at
  1318
  Eleven o'clock this night, be not interrupted under the Standing Order (Sittings of the House)."—[The Prime Minister.]

PRIVATE BILLS.
Birmingham Corporation Bill,
Reported, with Amendments, from the Local Legislation Committee (Section A); Report to lie upon the Table, and to be printed.
Walsall Corporation Bill,
Reported, with Amendments, from the Local Legislation Committee (Section B) I Title amended]; Report to lie upon the Table, and to be printed.
Tramways Provisional Order Bill,
Reported, without Amendment [Provisional Order confirmed]; Report to lie upon the Table, and to be printed.
Bill to be considered to-morrow.
Inclosure (Elmstone Hardwicke) Provisional Order Bill,
Reported, without Amendment [Provisional Order confirmed]; Report to lie upon the Table.
Bill to be read the third time Tomorrow.
Nottingham Mechanics Institution (Amendment) Bill [Lords],
Whitwell and District Gas Bill [Lords],
Mexborough Urban District Council Bill [Lords],
Stone Gas and Electricity Bill [Lords],
Mablethorpe Urban District Council Bill [Lords],
Reported, with Amendments; Reports to lie upon the Table, and to be printed.

STANDING COMMITTEES (CHAIRMEN'S PANEL).
Mr. Stuart-Wortley reported from the Chairmen's Panel, That they had appointed Mr. Arthur Stanley to act as Chairmen of Standing Committee A and Mr. T. P. O'Connor to act as Chairman of Standing Committee C (in respect of the British Nationality and Status of Aliens Bill [Lords] and the Exportation of Horses Rill).
Reports to lie upon the Table.

ORDERS OF THE DAY.
  WAYS AND MEANS [4th May].—REPORT.
  Resolution reported,
  WAYS AND MEANS [4th May].—REPORT.

    INCOME TAX.
    1. That—

    (a) Income Tax shall be charged for the year beginning the sixth day of April, nineteen hundred and fourteen, at the rate of one shilling and four pence in the pound; and

    (b) the like provisions shall have effect with respect to the Income Tax so charged, and the annual value of property, as had effect under Section two of the Finance Act, 1913, with respect to the Income Tax charged for the year beginning the sixth day of April, nineteen hundred and thirteen, and the value of property during that year; and

    (c) it is declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.

    Motion made, and Question proposed, "That this House doth agree with the Committee, in the said Resolution."—[The Chancellor of the Exchequer.]
    Sir F. BANBURY: There was such a noise going on when the Clerk was reading the Resolution that, although I did my best to follow what he said, I was not able, with any great surety, to ascertain what it was. But I understand that the Question is whether we agree with the Committee in the alterations of the Income Tax.
    Mr. AUSTEN CHAMBERLAIN: Will it be possible for us to have the Resolution read again, because there is some doubt as to exactly what it was?
    Mr. SPEAKERread the Resolution.
    Sir F. BANBURY: One of the chief reasons why I wish to raise a question regarding the Income Tax is that there is a very small number of people affected by this proposal. I believe that, out of something like seven or eight million electors, there are only about one and a quarter million who pay Income Tax of any description at all, and out of that you have to deduct about 750,000 who come under the exemption limits—that is to

    1321
    say, that they are exempted because their income is under £300, £400, £500, £600, or £700. I rather think, too, although I am not quite sure, that those persons who are exempted on account of earned incomes under £1,500 do not come into the 750,000. If that is so, it will be found that there are at the very outside only 300,000 or 400,000 people who are affected by the proposed change, and if you include the Super-tax, there are not more than 100,000 who are affected by this particular change. I think all economists will acknowledge that to allow a large body to pass legislation casting burdens upon a very small proportion is finance of the very worst description. I see the right hon. Gentleman the Member for West Islington (Mr. Lough) listening to me. I am inclined to think if he were a free agent he would agree with the maximums I have laid down, because I have often heard him make speeches somewhat in the same direction. In the Debate on the Committee stage the hon. Member for Blackburn (Mr. Snowden) congratulated the Chancellor of the Exchequer on the steps he had taken to find the surplus he required. I am not surprised at that. I have always considered that what financial ideas the Chancellor of the Exchequer possesses have been taken from the hon. Member for Blackburn, who not only in his speeches in this House and on public platforms, but in pamphlets which he has written, has laid down these doctrines. I do not blame him. I think he is a man of very great intellect, and although I do not agree with his opinions on any one point he is a man who has to be considered when he gets up in this House and makes a speech as he did the other day. I am sorry he is not present. But when we know the right hon. Gentleman the Chancellor of the Exchequer is a pupil of his, it is necessary we should survey the whole situation and ask ourselves to what this policy is leading?
    I am glad to see that the hon. Member for Blackburn has now come in. I can assure him I have said nothing derogatory of him in his absence. I explained that in discussing the amount of the Income Tax he expressed great surprise at the moderation of the Chancellor of the Exchequer. He said that, in his opinion, the proper course to pursue was, not to say "we are going to take 1s. 2d., 1s. 4d., or 1s. 6d., or whatever the amount may be, but to look at the man's income, and having regard to that, and having regard also to the
    1322
    requirements of the State, to say that the State wants so much. How much can we leave the owner of the income, how much will be sufficient for him to live on, and what will allow him certain luxuries which we think sufficient for him?" The hon. Gentleman went on to say that all this would really be in the interests of the owner of the income, because it would prevent him from indulging in certain luxuries—he did not say what they were—luxuries which were not for his benefit; and if a certain portion of his income were taken away from him it would be all the better for him. The hon. Gentleman considered 50 per cent. a sufficient share of the income to be left to the owner. I do not doubt for a moment that the Chancellor of the Exchequer has not followed his mentor so far as that. I do not think he would get up and say, however great might be the needs of the State, that 50 per cent. of the income must be taken. But what I want to ask is, How far are we going with this doctrine; where is it going to stop? The hon. Member for the Blackfriars Division of Glasgow (Mr. Barnes) would probably say that 25 per cent. would be sufficient for the owner, and there are plenty of people in this country at the present moment who would be quite prepared to say that £400 a year was a sufficient sum upon which a person could live. Not so very long ago a Cabinet Minister—a Member of the present Government—said that in his opinion £500 a year was sufficient as an earned income for any single person in the realm. We have an example, therefore, of what might happen when £500 a year would be considered the limit which was sufficient for a person to live upon in comfort; the rest would be taken away by the then Chancellor of the Exchequer. Will hon. Gentlemen opposite consider where we are drifting? Of course, I do not mean to say that a rise of twopence in the Income Tax at the present moment, though it is a serious rise, is something which the country cannot afford to pay. It can, but it must be remembered that the Chancellor of the Exchequer himself said that next year there would be a further increase in the expenditure unless there was a diminution in the outlay on the Army and Navy. He said there would be a further increase in expenditure of something like £6,000,000.
    The CHANCELLOR of the EXCHEQUER (Mr. Lloyd George)dissented.
    Sir F. BANBURY: As far as I can remember, the right hon. Gentleman told us the Grants which he was giving to various local authorities would amount to eleven and a quarter millions, but that this year, as they would not begin until the 1st December, the amount for which he estimated was something over four and a half millions. If you deduct the latter sum from the former, it leaves six and three-quarter millions. The Chancellor of the Exchequer will correct me if I am wrong, but it does seem to me to be safe to assume that, unless there is a reduction in the expenditure of the Army and Navy, there will be an increased expenditure of something like £6,000,000 to be provided for. How is that going to be found? Is it to be found by a further increase in the Income Tax? We may as well be frank. If a further tax is put upon the working classes they will probably refuse to vote for hon. Gentlemen opposite at the next election. That is a very serious thing. Is all this increased taxation to be put upon the shoulders of a small class, numbering at the very outset 400,000 or 500,000, and not really numbering more than 100,000? The hon. Member for Blackburn took as an example an income of £10,000 a year, and said that, in his opinion, if the State needed it, an Income Tax of 50 per cent. might be levied upon the person enjoying it. Does the hon. Member know all the time, hard work and brain power that is required to earn £10,000 a year? I do not know whether he has ever earned £10,000 a year, but I can tell him it is a very hard thing to do, and in order to do it a person has to devote his whole life to his profession, whether he is a barrister, a solicitor, a merchant, a stockbroker, a member of Lloyd's, a member of Mincing Lane, or any of those professions in which the owner of the income has to work himself or direct the management of a business. Of course in a big manufacturing business where there is a senior partner, he will have clerks and people under him, and the actual amount of work required to earn a large income from a manufactory is not so great as it is in those businesses, trades, or professions which are in the nature of a personal business or trade.
    I am, for the purpose of illustration, prepared to take a barrister or one of my own Constituents working in the City. In order to earn this income he has practically to devote the whole of his life to his business. He has practically no pleasures, he does
    1324
    not go to Monte Carlo, and, probably, ho does not even own a motor car. I can tell the hon. Gentleman that the fortunes which are made are made by saving and not by speculation or some big coup. Human nature being what it is, supposing he had been called to the Bar, and that he was, as he would have been, a great barrister earning £10,000 a year, and supposing he was told that half of that sum was to go to the State, what would he do? He would not work so hard, and would not earn £10,000 a year. The hon. Member shakes his head, but as he has admitted that he has never had experience in that particular direction, he will excuse me if I do not take the shake of his head as being strong evidence that I am wrong in my assertion. The majority of people in these circumstances would say, "I will not work as hard as this." The great majority have worked in this way because they desired to provide for their children. They deny themselves a great deal of what is pleasant in this world to achieve that result. If they are to be penalised they will say, "I do not see why Lloyd George should have the fruits of my hard work"—a sentiment with which I, personally, should quite agree. The result would be that the right hon. Gentleman would not get his money, because it would not be there to get. I do not suppose that any hon. Gentleman opposite will, in a speech, support my contention, but I honestly believe that many of them in their hearts secretly agree with what I am saying.
    All this sort of thing tends to prevent enterprise, which has been the main foundation of our great prosperity. All this legislation, and especially the Income Tax, tends to show that thrift is a foolish thing, and that to work hard in order to get money for yourself, which you invest and keep as capital, is wrong, because on that you will be taxed. I venture to say to the Chancellor of the Exchequer that what he ought to encourage in this country is thrift. Employment depends, first of all, on thrift, and, secondly, upon the investment of the results of that thrift in the industries of this country. Without these two things you get practically no employment, and the result of this tendency on the part of the right hon. Gentleman is to discourage thrift and the investment of the result of that thrift in the industries of this country. The right hon. Gentleman and the hon. Member for Blackburn and the Labour party must not

    1325
    think that because certain people have money that it is kept in a hole in the ground, or in a stocking hung up somewhere, or in bank-notes concealed in a mattress. It is invested, and its investment is what gives employment to our people. This is a very serious matter indeed. I am afraid it will be misrepresented on the ground that the rich classes are endeavouring to avoid paying this increase of 2d. because they do not like to put their hands in their pockets. I cannot speak for anbody but myself, but I believe that the majority of the people in this country would be only too glad to pay an Income Tax of 1s. 4d., 1s. 6d., or even 2s. in the £, if it were for something that was absolutely necessary in order to keep this country in the position it now occupies among the nations of the world. What we fear is that the result of all this, instead of keeping the country in that position, will tend to reduce it to a kind of Holland, Belgium, or Spain, or something very different from what it is now. It is the duty of the right hon. Gentleman to encourage enterprise. Every single thing that the right hon. Gentleman has done since he—I think for the misfortune of the country—became Chancellor of the Exchequer has tended in the other direction. Every single project of his has been proposed to obtain money not in the way in which his predecessors obtained it. I am not certain whether it was the hon. Member for East Northamptonshire (Mr. Chiozza Money) who, in the discussion on the Committee stage, stated that all previous Chancellors of the Exchequer were wrong and that the only Chancellor of the Exchequer who had ever been right was the right hon. Gentleman.
    Mr. CHIOZZA MONEY: I made no such statement.
    Sir F. BANBURY: It was some hon. Member opposite who pointed out that as the country had been prosperous during the last three or four years, and that as every previous Chancellor of the Exchequer would have stated that the method of taxation adopted by the right hon. Gentleman was wrong, it proved that every previous Chancellor of the Exchequer was wrong and that the right hon. Gentleman was right. It is quite true that during the last three or four years there has been a great boom in trade, but the right hon. Gentleman knows perfectly well that trade runs in cycles and, although this boom has
    1326
    lasted rather longer than most, it is not going to last for ever, because there are signs, even at the present moment, that it is diminishing. Any argument founded upon the fact that there has been during the last three or four years a particular boom in trade, and that therefore the legislation of the right hon. Gentleman has not been injurious to trade, is worth nothing at all. The effect of legislation such as the right hon. Gentleman has initiated, and the effect of constant increases in the Income Tax are not apparent at once, and take some years to develop. People do not feel the effect of it all at once. Some people might say that they live in hope that my right hon. Friend (Mr. Austen Chamberlain) will soon be directing the fortunes of this country so far as regards these matters.
    Mr. CHAMBERLAIN: I hope not.
    Sir F. BANBURY: There always is that feeling. Although the effect is not felt at once, yet it is as certain as I am standing here that in ten or fifteen years this legislation, if it is continued, will have the worst possible effects that could be imagined. I rose rather unexpectedly—there might possibly have been something else to discuss—therefore I apologise to the House if my remarks have not been so coherent as they might have been, but I feel so strongly on this subject that I believe I could get up at any moment and make a speech against increasing the Income Tax without very much trouble. I am afraid my remarks have been like the seed which fell on hard ground.
    Mr. CHARLES DUNCAN: Hear, hear!
    Sir F. BANBURY: I observe that the only hon. Member who cheers that is an hon. Member who has not got to pay.
    Mr. C. DUNCAN: We do not know that you pay.
    Sir F. BANBURY: I suppose I do. That brings me to another point I had forgotten. Unfortunately, I do pay, because at the present moment the bulk of my small income is called unearned. It is not unearned, because the greater part of it has been what I have earned myself. I should like to draw the attention of the Chancellor of the Exchequer to the extreme hardship of the cases where professional men, or men engaged in business have during many years of their lives worked hard and saved money, or amassed what is a competency on which

    1327
    they have retired, and then they are taxed on that as if it were unearned income. It is not unearned income at all; it is earned just as much as any income which is being earned at the present moment. There again, the whole policy of this Government and of this kind of taxation has been directed against thrift and in favour of extravagance. Take the cases of two men earning £3,000 or £4,000 a year in any profession you like to name. One spends only £1,000 a year and saves the rest, while the other takes the opportunity of going to Monte Carlo, dining at the Ritz, buying a motor car, and indulging in other forms of luxury, and spending perhaps all his income. One man has continued saving, so that be may be able to provide for his children and live comfortably in his old age, yet he is taxed on what is called unearned income, while the extravagant man keeps up his extravagance and is taxed on what is called earned income and pays very much less, whereas the man who has saved has a stake in the country if he has invested it in this country, which he may not have done under the policy of the right hon. Gentleman, and the other man has nothing. He has spent his money in riotous living and has enjoyed himself. I am obliged to the hon. Member for reminding me of this, which I consider to be a very serious blot in the incidence of the Income Tax. I trust hon. Members will consider where we are drifting in this insane policy of allowing the many to pass the legislation and then requiring the few to pay.
    Mr. LEES SMITH: I wish to ask the right hon. Gentleman's attention to one point, rather of administration than of policy. He told us, when he was announcing this concession on Monday, that he expected it would be a subject of great expense and trouble to the Inland Revenue. When he made that statement I was not very clear why that should follow, but I have tried to think it out since, and I have now come to see that it will not only be a subject of great expense to the Inland Revenue, but, corresponding to that expense, there is likely to be a very great deal of annoyance and irritation to a taxpayer with less than £500 a year. This 1s. 4d. is now, and must continue to be, deducted at the source. That means that all those who pay unearned Income Tax and have less than £500 a year will have to make claims for the repayment
    1328
    of their twopences or fourpences, as the case may be. I do not know whether the Inland Revenue has any figure upon this question, but I should say probably, if you take men with less than £500 a year and more than £160—probably three out of five of them have some small income from property or investments. This will mean that almost half a million taxpayers will be putting in claims for repayment. Not far from half the total number of Income Tax payers in the country will be doing so. I think, if one makes inquiries from those who have had to put in claims for repayment from the Inland Revenue, one realises that this part of the Income Tax is a greater nuisance and annoyance than almost any other. On this point I wish to put a suggestion before the Chancellor of the Exchequer. Most of these Income Tax payers are paying on earned income as well as unearned. When they fill in their returns for earned income in May or June, why should they not at the same time state their unearned income, and why should you not then calculate the repayments which are due to them on their unearned income, and then deduct the sum total of these twopences and fourpences from the tax which they would pay upon unearned income? This would be a means of ending the necessity for sending in claims for repayment. I imagine this would require a certain alteration in the existing law. It would require that instead of putting in a claim for the repayment of the unearned income in the year as they do under the existing law, they would have to be allowed to put in their claim on the basis of the preceding year. If a man sends in his return in May or June he cannot at that time know what dividends he is going to get later in the year, but by allowing him to send in his claims on the basis of his dividends in the preceding year, he would have good time to know before he made his return. I think if the Chancellor of the Exchequer would turn this suggestion over in his mind it would be a method of meeting some, although I realise not all, of the administrative difficulties which made him hesitate whether he would make this concession or not.
    Mr. CASSEL: I believe the Income Tax itself is a good tax. It falls, on the whole, upon people in proportion to their ability to pay, but, like most things, you can have too much of it. It seems to me there are only really two methods by which you could reduce it to a lower rate. One would

    1329
    be to vary the taxes and have more on other things, and the other would be to reduce your expenditure. The Chancellor of the Exchequer seems to neglect both those methods. For instance, mutton is a good food, but mutton may play too large a proportion in your dinner. So I think Income Tax may play too large a proportion of your total tax, and in that ease you may do an injury to the very tax by which you are raising so large a proportion of your revenue. So far as reduction of expenditure is concerned, there is one item under this Budget to which I am not entitled to take any exception, and that is, the larger Grant to local authorities. The right hon. Gentleman rather complained that we were not sufficiently grateful in regard to that. I am going to reserve my gratitude until I know exactly what I get, and what conditions are going to be attached to it. His suggestion the other day was unfair, that we were not going to get these Grants unless we also assented to a system of valuation which we consider not to be in the best interests of the country. Previously the objection used to be taken to tacking against the House of Lords: that is tacking against the House of Commons.
    Mr. SPEAKER: I do not think any discussion on the Grants or the method in which they are going to be given would be in order upon this. This is purely an Income Tax Resolution.
    Mr. CASSEL: I was dealing with the question of expenditure, and in criticising expenditure I felt that, as having constantly urged it for local authorities, I am not entitled to complain of that particular item. But when you come to the total expenditure, which is what makes the Income Tax so high, the right hon. Gentleman among Chancellors of the Exchequer stands in the very worst position. I have made calculations of the amount by which every Chancellor of the Exchequer has increased the national expenditure per annum. The result of increasing this expenditure is to send up the Income Tax, and I find the right hon. Gentleman is by far the worst. As we are nearing the time of a classic race, I might say it is Lloyd George first and the rest nowhere. During his six years of office the right hon. Gentleman has increased the annual expenditure, and thereby we have this high rate of Income Tax, by £7,500,000 a year, and in that I have excluded the Post Office, because I do not think it is right to
    1330
    charge the Chancellor of the Exchequer with the increase in the Post Office expenditure. If you compare that with other Chancellors of the Exchequer, Mr. Goschen, excluding the Post Office again, increased it at the rate of £1,600,000. Sir William Harcourt during the three years he held office, again excluding the Post Office, increased it by just over £2,000,000 and during the ten years of Unionist Administration, which the right hon. Gentleman was never weary of criticising for their extravagance, excluding the Post Office expenditure and including everything which they borrowed for naval or military expenditure, of which I give the right hon. Gentleman the benefit—
    Mr. LLOYD GEORGE: Does the hon. and learned Gentleman say he gives me the benefit of that £7,500,000? Has he excluded the Army and Navy?
    Mr. CASSEL: I did not make myself clear. In taking the Unionist figures, I excluded the Post Office, but added the borrowings for the Army and Navy. That increases the figure by that amount, and it works out at £4,500,000 per annum, as compared with £7,500,000. The right hon. Gentleman has now the Income Tax at this high figure. During that very time what did he say about the Unionist Administration?—
    "The Chancellor of the Exchequer ought to use his whole influence to check the wild, extravagant, expenditure. No one who has examined the expenditure of the last few years can characterise it in any other way. A shilling Income Tax in time of peace! It is a war tax in time of peace."
    He went on to say that they were reaching a point it was difficult for the public to tolerate. They were spending money which was their reserve, and which would be useful in case of war. The right hon. Gentleman there was not dealing at all with the character of the expenditure, but merely with the amount. I think the time has come when the Income Tax is so high that we ought to have fuller information as to what the national income and the national property is, and how the burdens of taxation really fall upon different classes of the community. I would suggest that the time has come when a Royal Commission or Select Committee ought to be appointed to inquire into what the national income really is, and what is the number of Income Tax payers. At present we make a vague guess. We had an answer to-day from the right hon. Gentleman telling us he could not say how many persons there were who had Income Tax

    1331
    deducted at the source and never made any return as Income Tax payers at all. If he is not in the position to tell us that, it is a matter of guesswork to try and estimate what the number of Income Tax payers is. I think the time has come when it might be advantageous to the Chancellor of the Exchequer to try and estimate what the national income really is, and how these heavy burdens fall upon the different classes of the community. We had a discussion as to Income Tax at a uniform rate of a shilling. So far as I can work out at present, the Income Tax, if you put it at a uniform rate, would be 1s. 3d., taking Income Tax and Super-tax together,
    Mr. CHIOZZA MONEY: Taking over the whole body of income?
    Mr. CASSEL: Yes. I will tell the hon. Member how I arrive at my conclusion. You arrive at it in this way. The hon. Member for Harwich (Mr. Newton) asked the Chancellor of the Exchequer a question on 12th May—What would be the yield on a full year of an Income Tax at the uniform rate of 1s. in the £, and the answer of the right hon. Gentleman was:—
    "The yield on a full year would be about £41,000,000." —[OFFICIAL REPORT, 12th May, 1914, col. 931.]
    We are, as a matter of fact, collecting in Income Tax and Super-tax £50,750,000. From these figures I work out that if there was a uniform rate it would be 1s. 3d. in the £ to produce the same amount of money. While the Unionist party were in office the right hon. Gentleman blamed them—
    Mr. LLOYD GEORGE: What is the date of the quotation the hon. Gentleman read? I am not challenging the accuracy of the quotation, but I want the date.
    Mr. CASSEL: It was in 1904. I cannot give the date, but it appears in "Hansard," Vol. 138, page 512. The Prime Minister also in his Budget speech in 1906 stated that the Income Tax at the uniform rate of 1s. was high enough, and that it pressed upon commerce and wages. The hon. Gentleman, in dealing with that, laid all the stress upon the word "uniform," but I am sure if he were interpreting a legal document, he would not give that interpretation of what the Prime Minister said. The Prime Minister was not complaining that it was not uniform, but he was complaining that Income Tax at the rate of 1s. in the £ was too high, subject
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    even to the abatements. At present we have an Income Tax which is equal to a uniform rate of 1s. 3d. in the £. I have calculated both in the same way, and the result shows that the Income Tax at present is 25 per cent. higher than it was at that time. Both the Prime Minister and the Chancellor of the Exchequer have completely departed from the views they held before, and I say that it was not fair for them to attack the Unionist Government for their expenditure when it was their intention when they came into office to increase expenditure at so much more rapid a rate. When I am dealing with the difference of the Income Tax as between earned and unearned incomes may I say that I recognise that there may be something to be said for the arrangement of the allowances. But I venture to say that the distinction is far too great. The right hon. Gentleman has made an allowance so far as unearned incomes up to £300 a year are concerned. That, so far as it goes, gives some relief to those on whom Income Tax presses hardest. But if you take incomes between £300 and £500, the difference is as between 9d. on earned and 1s. 2d. on unearned; and above £500 the difference is as between 9d. and 1s. 4d. That is a far greater difference than you can justify. The only ground on which you can justify the charging of a higher rate on unearned income than on earned income is that you enable the taxpayer who earns his income to set aside a certain proportion for the time when he cannot earn any more, or to make provision for his descendants after his death. You are franking seven-sixteenths of his income. I say that there is too great a difference between the amount of Income Tax charged to one with £500 and another with £1,000 a year. The difference is as between 9d. and 1s. 4d. and that is wholly incapable of justification.
    Another point to which I wish to call the attention of the Chancellor of the Exchequer is one to which I have referred before on many occasions. Every time you increase the Income Tax you increase the injustice of every anomaly connected with it. That is the absurd way in which it works out in the case of husband and wife as our law stands at present. It is too ridiculous for words! It is due to the fact that the Act imposing the Income Tax preceded the Married Women's Property Act. The Income Tax was originally passed in 1842, and it has never been altered in that respect. What is the

    1333
    result? It is unjust to the husband and unjust to the wife, and it penalises the husband. You make the husband responsible for paying Income Tax on his wife's income, and you give him no power to recover it from her. There was even a case not long ago when a man was sent to prison because he either would not or could not pay the Income Tax on his wife's income. He had a comparatively small revenue himself, but the Commissioners of Inland Revenue put him in prison because he did not pay the tax on his wife's income.
    Mr. LLOYD GEORGEindicated dissent.
    Mr. CASSEL: The right hon. Gentleman shakes his head, but it is perfectly true. They let him out of prison the day before the House reassembled, because they could not face the criticism to which they would be subjected in this House. I say that is perfectly monstrous, and the law ought to be altered at the earliest possible moment. I think the right hon. Gentleman has promised to alter the law, but he has not included in the Budget Statement the Resolution necessary to enable him to do so. He failed in his attempt to legislate upon this point last year because he had no proper Resolution then upon which he could take action, and he has made the same mistake now. He will have to get a new Resolution, upon which I hope he will give us plenty of opportunity to discuss the question. The present method is unjust to the wife in this respect: You deduct Income Tax at the source of her income, but if she is entitled to an abatement she cannot claim it. The claim must be made by the husband, and he can make a profit by claiming an abatement in respect of the tax on the wife's income. There is no means by which she can recover the amount of the abatement from her husband. I could give a case where the husband made a profit of 12s. 6d. in that way. It is a small amount, but the matter to which I am referring affects a great many cases. [Laughter.] The right hon. Gentleman laughs, but this affects every case where the wife has got income from an investment and is entitled to an abatement. She cannot claim the abatement, and, if her husband claims it, she cannot recover it from him if he does not choose to pay it to her. That is the absurd position in which the law stands.
    Then Income Tax, as it affects husband and wife at this moment, specially
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    penalises marriage. The way it works out is absolutely absurd. You add the two incomes together and treat them as if they were the income of one person. Surely that is grossly unfair, and the more you increase the Income Tax, the more unfair does the injustice become, because the higher the Income Tax, the greater the penalty you impose upon marriage. Mind you, you only impose it upon marriage if husband and wife live together. If they live separately, they get the benefit of the abatements, and if there is a divorce, the State looks upon the parties as separate individuals. Surely the state of the law is most unsatisfactory in that regard. The right hon. Gentleman says that he feels some difficulty in treating husband and wife separately for all purposes, and that if he did so he would lose a lot of money. I see that there is some difficulty, but, at the same time, if you are going to lose money, surely it is better that the tax should be levied justly, even if you have to raise money from some other way.
    I submit to the right hon. Gentleman that married people are entitled to some exemption as married people, because their requirements and expenditure must be greater. Supposing you take two people marrying with £200 each. I say that they have greater requirements than one person would have with the same amount of income. They contribute more in indirect taxation oil such articles, for example, as tea and sugar. They also contribute more to local taxation in the way of rates, because they require more accommodation. I think the present state of the law is absolutely indefensible, unjust, and unreasonable, and I shall certainly, when the Finance Bill comes before the House later press some Amendments upon the right hon. Gentleman. May I give him this example from America, and ask if he will follow the precedent set in that country? Will he, at all events, give a special marriage exemption? In America they do add the two incomes together, but they give a special exemption because they are married people. There is only one other anomaly in connection with the Income Tax to which I should like to call the attention of the right hon. Gentleman, and that is in connection with life insurance companies. At present life insurance companies do not pay Income Tax upon profits, but upon the interest of their investments. The interest on their investments

    1335
    is very much larger than the profits out of which they pay their claims. They pay their claims to policy holders out of premiums and interest on investments, and in cases where the amounts of interest on investments are greater than the profits—sometimes they are more than double—it is only just that they should be taxed upon the real profits; otherwise when the Income Tax is as at the present at a high rate, you send up the rate 4s. or 5s. in the £. It follows that the interest on their investment is much greater than the profits of the company. This affects all the policy holders who participate in profits. It also affects the industrial insurance companies as well, and in that way you touch a large number of persons who are in a position that heavier taxation should not be placed upon them than is absolutely justified. I can only repeat in regard to the Income Tax that I think we are really driving it too far, and that the time has come when the Chancellor of the Exchequer ought seriously to consider a greater variation in the taxation of this country, and also when he ought to take more seriously into consideration the growth of expenditure.
    5.0 P.M.
    Mr. GODFREY COLLINS: The hon. Member who has just sat down has argued that direct taxation should not be so heavily increased, thereby implying that the only way to raise further sums of money is by increasing indirect taxation. Whether that will meet with general approval in this House I do not know; but, believing, as I do, in direct taxation, I certainly very heartily support the increase in the Income Tax. The hon. Baronet, in a very frank statement, admitted that all classes would willingly pay an Income Tax of 1s. 4d. if the payment of that tax was necessary to maintain our position in the world. No man is a better authority on public companies and the balance-sheets of our great industrial concerns than is the hon. Baronet, and he knows that successful industrial concerns, when trade is good and profits are large, set aside yearly out of revenue large sums to modernise their plant and meet future competition. In this Budget the State is setting aside a large sum out of yearly revenue to meet the international competition of the future, and, if my comparison is correct, it depends then on how wisely will the money be spent by this House.
    Viscount HELMSLEY: What about Death Duties?
    Mr. GODFREY COLLINS: At the present moment I can only direct my attention solely to the Income Tax, and I am arguing that the increase of Income Tax can be justified by the objects for which the money is raised in the best interests of all concerned. The hon. Baronet also in the opening part of the speech, argued that the reasons why the Income Tax was being so largely increased was because there are so few Income Tax payers. I have a great belief in the sense of fairness of my fellow-countrymen, and if any Chancellor of the Exchequer on either side of the House was thought by the ordinary man of small income to be punitive and unfair, there is little doubt whatever that he would show his resentment at the polls when the opportunity arose.
    Viscount HELMSLEY: Hear, hear.
    Mr. G. COLLINS: Well, you will have an opportunity probably before eighteen months are over. The hon. Baronet also asked how far we are prepared to go. I think that that depends entirely on the objects for which the money is required. During the last three years I have often advocated that the Income Tax should be increased, and naturally when it is being increased this year I heartily support it. State income is determined by State expenditure. Private individuals adjust their expenditure to their income, and if I am asked how much further direct taxation should go, I answer that direct taxation and all forms of taxation will increase in future until the taxpayers say, "Thus far and no further will you go and take money from my pocket." That day has not yet arrived. But I rose with one definite purpose. The Government in their Budget appear to me to have discarded the principle of local Income Tax and the taxation of land values to raise money for local purposes. This increase in the Imperial Income Tax evidently is going to take the place of a local Income Tax and the taxation of land values to provide money for local purposes. I may be too previous in my judgment. Probably I should be out of order if I pursued this matter further, but I wish to add a word of protest against the policy of the Government, if I understand it aright, in that they are not going to give local authorities power to tap new sources of revenue for local purposes. Probably, before many weeks are over,

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    we shall have the policy of the Government more clearly outlined. This Income Tax raising these large sums of money which are going to be spent upon purely local purposes, will undoubtedly place large sums of money in the coffers of local authorities. The hon. Baronet argued that perhaps some share of the increased taxashould come from the indirect taxpayer. I venture to assert—and I am sure that all parties in this House will agree—that local taxation does bear to-day very heavily on the working classes in the different localities, and because this Income Tax, raising as it does several million pounds, will give relief where relief is wanted, I shall have much pleasure in supporting it.
    Mr. HICKS BEACH: There is no doubt that when we find the Income Tax raised to 1s. 4d. in the £ every attempt should be made by this House to ensure that the people who have to pay at that rate shall pay upon a fair and equitable basis. I wish to give a word of thanks to the Chancellor of the Exchequer on behalf of the owners of the land in the country, because I do believe that he has given us a real concession in the Budget this year in announcing that owners of agricultural land are in future to be assessed for Income Tax upon the net income which they receive from rents of their estates. That is a matter for very real congratulation, and I am sure that the Chancellor of the Exchequer would not have done this unless he was firmly convinced that the owners of land had put forward for a good many years claims that were eminently justifiable. The Resolution which we are now discussing does enact, as I understand it, that Income Tax under Schedules A and B shall be collected in the coming year in the same manner as they have been collected in the past. That does not carry out, to my mind, the announcement made by the Chancellor that the owner of property should pay upon his net income. I suppose he means that in order to get this rebate, or whatever you like to call it, he would have to put in a claim such as he has done in recent years, showing the excess amount spent on ordinary upkeep and repairs over the statutory amount hitherto allowed. I venture to ask the Chancellor of the Exchequer if he cannot now see his way to do away with the very cumbrous method of getting the collection of Income Tax under Schedule A, and allow an owner of property so assessed to send in a return, like
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    anybody else, under Schedule D of the actual net income he receives, taken over an average of three years, as is done in any ordinary business? It is a much simpler thing for the purpose of accounts, and I believe that it is equally simple or more simple for the officials of the Inland Revenue themselves. We are told that this high Income Tax of 1s. 4d. in the £ is being levied chiefly for three purposes. There is first expenditure on armaments, which the hon. Member who has just sat down said ought to be treated as payments out of revenue for what is really putting in fresh capital in the form of new and better machinery for the State. I would rather be inclined to treat it, not as capital expenditure, but more as ordinary expenditure upon necessary upkeep and repairs, because, if we do not maintain our Army and Navy in a proper state of efficiency, then the machinery of the State is not in a proper condition to guarantee the safety of the State for the coming year. The hon. Member for Rushcliffe (Mr. Leif Jones) said that the Income Tax was not expenditure, because it was devoted to the payment of old age pensions. I do not know how he arrived at that conclusion.
    Mr. LEIF JONES: What I really said was that the Income Tax was not expenditure in the sense in which the rest of the Budget was expenditure, for it is a transfer of property from one set of spenders to another set of spenders.
    Mr. HICKS BEACH: I think that the hon. Member rather takes the same view as the hon. Member for Northampton (Mr. Chiozza Money), who, I think, gave expression to the view that this transference of money from the Income Tax payer to the old age pensioners was a really desirable thing from the point of trade and employment in the country. I think that the hon. Member said that the money was spent in a better class of trade by the old age pensioners than by the person who had to pay the Income Tax. I am not going to dispute that point. It may be so, though, at any rate, some of the money goes on such luxuries as a glass of beer, and possibly a glass of whisky, and I do not know if the hon. Member for Rushcliffe regards expenditure of that kind as so eminently superior to some of the forms of expenditure indulged in by the Super-tax payer. But both hon. Members will admit this fact. If you divert this money from one form of trade to

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    another you must obviously throw out of employment a great many people who are now deriving employment as the direct result of this luxurious expenditure, as you call it, of the people who pay Income Tax and Super-tax, on various forms of luxuries and amusements. That money benefits certain classes of trade, and by converting this money into old age pensions you admittedly inflict at the same time a considerable hardship upon another section of the wage-earning community who are as much entitled to be considered as those who are provided with the comforts of old age pensions. The hon. Member for Blackburn says that old age pensions are eminently desirable, and the Income Tax payers certainly ought to pay for them, because he says that the workers are the sole creators of wealth in this country; and he gave expression to the view that, that being so, there was no harm at all in taking from the possessor of wealth a much larger share of his income than even the Chancellor of the Ex-proposed to take. I must dissent from the view that the worker is the sole creator of wealth. I was always led to understand that there are other factors in the creation of wealth. First of all, capital; and secondly, brains; and workers without either capital or brains behind them can no more produce wealth than can capital or brains produce wealth without workers.
    If you are, as the hon. Member for Blackburn was suggesting, going to take away in future years a still larger share of the income of the capitalist or the man with brains, it seems to me obvious that in time the point of taxation will have been reached at which it will not only produce something of a check, but a very direct check, upon the proper creation of wealth in this country. If you pursue that course, obviously you will not improve the conditions of the workers of the country, but will render them very much worse, indeed, than they are at present. Whatever may be the views of economists as to the ultimate effect of high taxation, and as to whether or not the whole of the taxation is in the end indirectly thrown upon the shoulders of the less highly paid of the community, I do not feel myself really capable to argue, but certainly it is held by sound economists that very high taxation of the rich in the end either affects employment or makes prices to the workers higher, so that the taxation eventually
    1340
    falls on the more lowly paid members of the community. But, however that may be, at any rate I think that hon. Members opposite will support their own Prime Minister, who has told us that an Income Tax at the uniform rate of 1s. in the £ was impossible to justify in times of peace, for, among other reasons, that it was a check not only on profits, but also on wages. I myself am quite ready to rest myself behind the economic dictum and knowledge of the Prime Minister and to support him when he says that a tax of 1s. in the £ is a check upon the wages as well as profit.
    We must not forget what the Prime Minister also said, namely, that the high rate of Income Tax is impossible to justify in time of peace, because it tends to destroy the most ready resource of taxation in time of emergency. That is a point which ought to be very seriously considered by the House. We are at the present moment in a time of profound peace, to all outward appearances, and we all hope that it will continue, but here we are with an Income Tax at the nominal rate of 1s. 4d. in the £, and in some cases more. These enormous direct taxes are far higher, I believe, than they have ever been in this country before—taking the Death Duties and the Income Tax together. Has not the time arrived when we ought really to consider whether there is not some other method of taxation which might be differently imposed—an equitable scheme of distribution of burdens of which this House might avail itself in time of peace, rather than make these increases in the rate of Income Tax? The Income Tax is far and away the easiest tax to raise; the whole machinery is regular and in working order; and an increase of a 1d. or 2d. is a by far easier way of raising revenue than any other form of taxation ever brought forward in this House. That is the point to which the House should give its full consideration before this Budget has finally left its hands.
    We are told that a part of the money raised by the Income Tax is to be used to assist the ratepayers in both urban and rural districts. The Chancellor of the Exchequer told us that we have been complaining in the past about the burden of the rates, and that therefore we ought to be very grateful to him when he has put an additional 2d. on the Income Tax, part of which will go towards relieving the burdens on the ratepayers. The Chancellor of the Exchequer promises that there

    1341
    will be a reduction of 9d. in the £ in the rates. I, for one, do not expect to see that until it actually arrives, and I hesitate to express an opinion about what will be the real effect of the Chancellor of the Exchequer's local taxation proposals until I have seen them at work and witnessed their results. I should like a very much fuller explanation from the Government as to their reason for rejecting a local Income Tax. I believe we could have reduced the rate of Imperial Income Tax, or, rather, that we need not have raised the rate of the Imperial Income Tax to 1s. 4d., if you had set up a scheme of local Income Tax for the purpose of assisting the rates throughout the country. The only explanation which the Chancellor of the Exchequer gave us for not taking up this proposal was that a certain Committee of experts said it was impossible. I would like very much to know who those experts on the Committee were, and what were their real reasons for saying it was impossible. I have a very shrewd suspicion that one of their reasons was that the Committee was very largely composed of officials of the Inland Revenue Department, and I am very much afraid that they looked upon this particular product of the Income Tax as their own spoil, which would be taken away from them by the local authorities if they gave their sanction to any form of local Income Tax.
    Speaking for myself, I feel that I personally would much sooner pay a larger share for national services by way of Income Tax than I would by way of rates. I do not think that the owner and occupier of land will get any real relief in respect of the rates by reason of his having to pay higher Imperial Income Tax himself. Our complaint has been that personal property has not contributed to local rates. You are increasing the Income Tax both on owners of real property and personal property. The owner and occupier of real property still pays the local rates, and he has, in addition, to pay the increased Imperial Income Tax in the same way as the owner of personal property. Therefore, I do not think the present proposals will bring about a much more equitable arrangement of local taxtaion as between real and personal property than we have had before. There is another point I wish to raise. Are we certain that everybody in this country is paying Income Tax in proportion to his proper income. We know that anybody with a fixed salary of over
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    £160 per year pays Income Tax of a sort, but a great many people in this country—artisans, miners, and others who earn a good deal more than £160 per year—do not, so far as I understand, pay any Income Tax at all. Has not the time arrived when we are Budgeting for an expenditure of over £200,000,000, that something should be done. I cannot but feel regret that no Member of the Government, so far as I am aware, has expressed any regret at all at the expenditure of this country, but rather appeared to glorify in the fact that the Government have been able to Budget for an expenditure of over £200,000,000. I do not think that is quite the proper attitude to take in regard to so enormous an expenditure, and I think it would have been well if there had been some expression of regret at its vast amount. When we have those huge figures, and when a great deal of this expenditure is to be devoted more and more to what are called social reform schemes, I submit that it ought to be impressed on the general body of workers in this country, in one form or another, that, however much they may vote for the taxation of other persons, they themselves have got to pay something in the long run. Would it not be fair, therefore, to take off, if you like, some of the indirect taxation—say, part of the tax on tea and sugar—and put it on an Income Tax to be paid by every wage-earning person in the country?
    I do not say it should be a high tax, but a penny in the pound would, to my mind, be far better in the long run than some of those indirect taxes, because direct taxation would enable the taxpayers to immediately observe the effect of any large expenditure of public money, and they would see that it meant that the workers, as well as others, would have to pay something towards that expenditure. After all, that is not an impossible thing to do. You are collecting stamps for another purpose, and it would not be so very much more to the employer if he were called upon to lick another penny stamp. I submit that this suggestion, if adopted, would be a very much sounder thing for the country generally, and in the long run would tend to promote some feeling or desire for proper and careful expenditure on the part of the great spending Departments of the country. One other point to which I wish to refer is the fact that the Chancellor of the Exchequer and

    1343
    his immediate associates are shouldering the duty of spending money on social reforms, but I sincerely hope that the Treasury will very soon give up that part of its duty, which consists of giving doles of money for old age pensions and national insurance, and that this duty may be handed over to one of the other Departments—say, the Local Government Board. Then the Treasury could revert to its old duty of criticising, and criticising severely, every item of expenditure incurred by any other public Department of the State. If that were done I believe it would be much more sensible and would curtail some of our expenditure. It is only by keeping the expenditure of this country within proper limits that we can hope for any chance of reducing the Income Tax or any other tax.
    Sir WILLIAM BYLES: The hon. Member who has just sat down, and who speaks with a certain hereditary authority on questions of finance, is anxious to keep the Income Tax at 1s. in the £. I am quite sure he has the sympathy of a good many Income Tax payers in this House in that desire. I would refer the hon. Gentleman to an observation made by his colleague behind him, the hon. and learned Gentleman the Member for West St. Pancras (Mr. Cassel), who suggested that the Chancellor of the Exchequer should reduce the expenditure of the nation. That is a subject which I am quite sure Mr. Speaker would not allow me to speak upon, but I have no doubt that many Members of this House know perfectly well what I should put my finger upon as a suggested reduction in the expenditure of the nation. So long as we think it necessary to spend nearly half our income in defending ourselves against enemies who never come near us, I think the argument the hon. and learned Gentleman has addressed to us is incomplete.
    Mr. G. D. FABER: You want to use it against Ulster.
    Sir W. BYLES: I think that is a very futile and irrelevant interruption. The hon. Baronet who opened this Debate seemed alarmed at the rate at which we are going, and wondered when it was going to stop; he informed us, no doubt from his own experience, how difficult it was to earn £10,000 a year. In my belief very few people ever do earn £10,000 a year or are worth £10,000 a year to anybody. No doubt they acquire £10,000 a
    1344
    year, but it is generally earned for them by those whom they employ. The hon. Baronet the Member for the City (Sir F. Banbury) said that if we spent money at such a rate we were discouraging thrift. I am not quite sure whether the more the Chancellor takes out of our pockets we are not the more disposed to exercise the practice of thrift. What can we do if our pockets are rifled by the Chancellor of the Exchequer? I will not say he robs them—
    Sir F. BANBURY: A very good description.
    Sir W. BYLES: As hon. Members opposite sometimes say, if our pockets are rifled by the Chancellor of the Exchequer we must take care of what is left. The tendency will be to make us more and more thrifty. Therefore, I contend, if I am right, that absolutely disposes of the hon. Baronet's point. The only reason I really rose to address the House was because I wished to express my strong approval of the method of taxing the community directly instead of indirectly. I rejoice that the Chancellor of the Exchequer, who had such a big job before him, nevertheless has been able to make up the very large sum he required without increasing indirect taxation. I have been for long opposed to indirect taxation. It costs a great deal more to collect for one thing, and a great deal less in proportion of what really falls on the taxpayer finds its way to the Treasury in the case of indirect taxation. But above all, and far more important than either of those points, is that in the case of indirect taxation men pay their taxes without knowing that they are paying them, and therefore they do not ask what becomes of them. Money is extracted from them by a sort of painless dentistry. The sugar basin is rifled, or the teapot, or the tobacco pouches, and when men call for a cigar, or drink a glass of beer, they never reflect for a moment that they are paying taxes. But when a man is called upon to pay direct taxes, he never does it without a squirm. The reflection that always comes into my mind when I unwillingly disgorge, for I belong to that very small class whom the hon. Baronet thinks is bearing too large a share of the burden, I always think do we really want to spend eighty millions to defend ourselves—against whom? Against neighbours who may be, and, so far as I know, are perfectly friendly.

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    I approve of this new taxation being put on the wealthier classes of the community. I believe it does them good. I believe that it is not in their interests or in the interests of the nation that we should have excessive and vast accumulations of wealth in the hands of individuals. It gives them too much power, and it is neither good for their health, nor for the health of the community. Again, the expenditure of this country to which I have referred is, indeed, to protect their property, and that is another reason why the insurance or protection money should be taken from them. Lord Esher argued in the "Times" the other day that the taxes of which rich men are complaining, after all, will fall on the poor, and, if that be the case, then there is no more ground for the rich man's complaint. I do not say whether it be so or not, but I do know this, that the mass of the money has been obtained by the labour of the poor, or, rather, of the workers, rich and poor. There is one other reason why I approve of this Budget. The more you impose taxes upon the worker the more you are hindering his productivity—his output; and I remember about not muzzling the ox that treads the corn, and I think it is for the interests of us all that, as far as possible, the worker should be relieved and enabled to live a good, strong, healthy, vigorous life, and that the burdens, and especially those foolish burdens which I have already mentioned, should fall upon the accumulated resources and the accumulated wealth of which we are hearing such stories nowadays. The amount of money liable for Income Tax which has grown so largely shows that the accumulated sources of wealth are abundantly able to pay for the expenditure which, wisely or unwisely, the House of Commons votes.
    Mr. SANDERSON: The general question as to the principles of Income Tax in regard to the trade and business of the country have been so clearly and forcibly put before the House that I do not propose to refer to them. I rise to draw attention to three points which are constantly being brought under my notice with regard to the Income Tax, and I think those points will show that the Chancellor, in framing his Budget, has not had regard, or, at all events, has not had sufficient regard to the principle that a man ought to be taxed according to the amount that he can pay. For instance, he has made an abatement with respect to children in the
    1346
    case of a person who has a limited income. If it is proper to apply that principle in any case, then for the life of me I cannot understand why it should not be applied in every case. Take the case of a man who has an income of £500 a year, which is the limit, I think, to which abatement in this respect applies. If it applies in that case, why should it not apply equally in the case of a man with an income of, say, £701? Everybody knows perfectly well that the professional man who is earning from £700 to £1,000 a year and who is a married man with a family is hard put to make ends meet, and in all probability just as hard put as a man who has an income of £499 a year. In my opinion, and I believe in the opinion of the large majority of people who have to pay Income Tax, that is a matter which ought to be taken into consideration, no matter what a man's income is, and that what the man's responsibilities are should be taken into account. One means of ascertaining that would be whether the man was married and had a family or not. If he is a married man with a family he ought not to be called upon to pay so much as the bachelor.
    That brings me to the point raised so forcibly by the hon. Member for St. Pancras (Mr. Cassel), who practically raised all the points that I had intended to deal with, so that I shall just summarise what he said. It seems to me to be absolutely indefensible that you should treat a man and his wife as one individual for the purposes of taxation. They are two people. [HON. MEMBERS: "Agreed!"] Hon. Members opposite say "Agreed!" but it is no use saying so unless we can induce the Chancellor to agree, and, until we do so, we must keep pressing the matter. I am very glad to have the assistance of hon. Members opposite, and I hope they will get up and support us on this point. They are two individuals; their expenses are those of two individuals, and so are their responsibilities. The Chancellor of the Exchequer said just now when my hon. Friend was speaking, "I should lose a lot of money by it." I do not know how much money he would lose, but if he is going to lose money by it I would suggest to him that he might give up the Land Taxes and the great expense involved in them, and in that way do justice to married women in this country. The third point is this: It is recognised now that a man who earns his income is to be put in a more privileged position than the person who has the great

    1347
    advantage of a settled income derived from capital which he probably has inherited. If you once apply that principle, I cannot see why you should do so to the income from capital which the man himself has earned.
    The hon. Baronet the Member for the City made a point this afternoon that is constantly being made to me by professional men. They say, "We have worked for this capital, perhaps for many years, and have paid Income Tax on it already," and probably a large Income Tax. If the principle of differentiation is admitted, then I cannot understand why it should be applied in a case of that kind. It is in fact putting a premium on extravagance. It is a duty laid upon a man to provide for his old age, and to provide for his wife and family. Some hon. Members apparently have forgotten that there is such a duty, and that a man ought to do his best by confining his yearly expenditure so as to enable him to save money out of income in order that he may so make provision. Surely such a man ought to get the benefit of the abatements. These are quite distinct points well worthy of the attention of the Chancellor of the Exchequer. I understand some of this Income Tax, which is now at this high rate, is to be applied for the purpose of relieving the rates of localities. That question, however, is not, I believe, strictly in order on this occasion. I hope the Chancellor of the Exchequer will be able to give friendly and kindly consideration to those three points which are made, not only on this side, but on his own side, and that he will give some relief.
    Mr. C. E. PRICE: I believe that the Budgets of the Chancellor of the Exchequer, more particularly the Budget of 1909 and that of this year, will rank with the great Budgets of Mr. Gladstone. I am sure that these Budgets are for all time, and I am extremely grateful for what the right hon. Gentleman has done. At the same time, I am not a great lover of the increase of the Income Tax. I say that quite impartially, because it makes no difference to me whether the extra tax is 2s., 3s., or 5s.; it will not affect me by a single farthing, because I live a long way below either limit. It is estimated that the increase this year will produce £5,250,000, but nearly the whole of it will go to relieve local rates. Next year the total increased yield of Income Tax and Death Duties will amount to £13,230,000, and the total Grants-in-Aid to £11,955,000. I would far
    1348
    rather, instead of this £11,000,000 going for the relief of local rates, it had been used for taking the taxes off food. If there is any trouble in passing this Budget, I hope that that will be the alternative. Both Mr. Gladstone and Lord Farrar declared that rates were a burden upon property which it could well afford to pay, and that doles like those under the Agricultural Bates Act really ultimately go to increase rents and raise the value of real property, whether in town or in country. Therefore, I look with very great concern upon these increased Grants towards local rates. My own reason for supporting this Budget is that we have indicated to us that we shall have a fresh valuation and a new Rating Bill.
    I should like to point out one or two cases where Income Tax works up very unfairly. I remember many years ago, when I was in business, my firm had the great misfortune to have a place wholly burnt down. We took two other factories. Within a few weeks a second factory was burnt down, and we had the melancholy experience of having three factories lying idle. In consequence, we suffered a very great loss. What was the result? So soon as we erect a factory we begin to earn income, and we are taxed on that income. In point of fact, in this case we worked for two years for nothing, because it took us two years to make good our factory as it was before. It is grossly unfair that you should tax an income which is not really income, because you are only making good the losses you have sustained. I am perfectly certain that these great increases in Income Tax and Death Duties will turn men's minds to a form of raising revenue to which hitherto they have not given consideration. The first function of the State in all its legislative enactments is to see that wealth as it is created goes into the pockets of those who create it. You have a lot of wealth which is communistically created, and at present that communistically created wealth goes into the pockets of the few. The Chancellor of the Exchequer will render infinitely greater service to the State if he will make himself the means of raising his revenue first from that communistically created wealth instead of from increased Income Tax. If year by year you got into the Exchequer the communistically created wealth, you would have far less disturbance in connection with the estates of those who leave large sums of money. It is a great disturbance to estates and industries that they should

    1349
    have so much taken from them. If year by year, as wealth is being created, you take into the Exchequer that which is being communistically created, you do not rob any man; you simply take for the community that which the community has created. I support the increased Income Tax only because of the promise that we are to have valuation, and it is through valuation that we may get hold of that communistically created wealth. I shall support the Budget, although I say frankly it is not one that I care much about. The Prime Minister as long ago as 1898 delivered a speech pledging the Government to deal with local rating.
    Mr. SPEAKER: The hon. Member cannot go into that question now.
    Mr. PRICE: I was only going to observe, in regard to the increased Income Tax going to local rates, that the Prime Minister says that the relief should be given in another way, and I would rather that the right hon. Gentleman returned to that belief.
    Mr. JOYNSON-HICKS: As far as I can gather, the hon. Member opposite (Mr. C. E. Price) disapproves of the Budget, but is going to vote for it for reasons which have nothing whatever to do with it. I will not follow him into the intricate mode by which he squares his conscience with his party allegiance. I cannot possibly agree with one or two of the remarks of my hon. Friend the Member for Tewkesbury (Mr. Hicks Beach) in regard to a local Income Tax. In my opinion, the idea of a local Income Tax will not commend itself to the majority of this House. Certainly, it would not to me. Such a tax would be exceedingly difficult to apply, and exceedingly unequal; it would lead to evasion of all kinds, and to moving about from district to district. I have no right to speak for the party on this side, but personally I do not want the House to think that the suggestions made by my hon. Friend, valuable as they may be from his own point of view, are accepted by any large number of those who sit round him. I am sorry to differ also from his suggestion to levy an Income Tax on working men's wages. I think that that is impracticable. I agree that all classes must pay something towards the taxation of the community, but I think that the best method of ensuring that working men shall pay something, as I believe that they desire to do, towards the upkeep of the country is the system of indirect
    1350
    taxation at present in vogue. The hon. Member for Salford (Sir W. Byles) made his usual speech against indirect taxation, the gravamen of his object being that it costs so much to collect. I am certain that any scheme of obtaining Income Tax on working men's wages would cost far more in proportion than the existing indirect taxes to collect.
    I really rose for the purpose of dealing with the Chancellor of the Exchequer's references to a speech of mine at Grimsby. The hon. Member for Salford said that when people sign their cheques for Income Tax they generally ask themselves, "What do we really want with a Navy and an Army?" I am not at all sure that I agree with him. I am inclined to think that the expression much more likely to be used when people sign those cheques is, "Do we really want Lloyd George?" As regards my statement at Grimsby, if I am called upon to pay additional taxation—it does not matter whether it is £100 or any number of hundreds of pounds per annum—I have to get that money from somewhere. I have to save it from some form of expenditure which I now make. I cannot eat any less; I cannot drink any less. [Laughter.] That is perfectly true, as the Chancellor of the Exchequer knows. I cannot save it by smoking any less, because I am practically a non-smoker. Therefore, I cannot make up the money by any personal self-denial. To be perfectly frank, my principal hobby is a garden, where I employ a large number of gardeners. It is a luxury, if you like, but it is a luxury the money spent upon which goes practically entirely in wages to the working classes—in this case, the gardeners. It is quite within the bounds of possibility, that being my principal luxury, that in order to find money for extra taxation I shall have to economise upon my garden. That is bound to fall directly upon some of the working men employed there. I cannot help myself. If the right hon. Gentleman can suggest a better method by which I can get the money for him, I shall be delighted. The method I suggested the other day at Grimsby was in regard to a motor car. The right hon. Gentleman was wrong in one point by 10 per cent. It was not a £900, but an £800 car. What I told the people at Grimsby was that I had intended to have a new motor car, but that I was expecting the Budget to come on, and I knew my Lloyd George. Some of the audience said, "So do we," and by

    1351
    their votes they seem to have shown that they do. I said perfectly frankly to them—I think it is better to talk frankly when you are speaking to the working classes—that instead of buying that new car, I should have an old one repaired. I had my old car repaired, and the consequence is that, instead of £800 going into the pockets of the manufacturers and the working men of this country, only £120 or £130 went. The Chancellor of the Exchequer's answer to me was:—
    "What the hon. Member does not recollect is that the money which is being raised is to be put into the hands of the local authorities for houses and that sort of thing. At the present moment—"
    This is a most ingenious calculation—
    "the loss on houses is 20 per cent. of the total cost, so that on that basis his £900 motor car would have financed the building of at least twenty cottages."
    6.0 P.M.
    It is very difficult to say how you can ever build ten cottages out of the finance of a £900 motor car. The right hon. Gentleman quite forgot to tell the House that in order to do that he has got to extract not merely money from me, but he has got to extract a large amount of money in rates from the ratepayers of the different localities where the houses are going to be built. I am quite prepared to admit that his main argument was to this extent accurate: That if he takes money from me that I intended to buy a new motor car with, and so provide work for the men who make cars, and spend it on building cottages, he provides work for men there. On the face of it that is perfectly accurate. But the fallacy that lies behind the Chancellor of the Exchequer's statement, is this: That is depriving us of liberty if he is merely going to take taxation in order to spend it in ways that he thinks best, instead of in the way that I think best, he is doing a harm—not merely is he doing harm to the liberty of the subject in myself. If his argument means anything, he is quite justified from the point of view of the country in taking the whole of my income and spending it in cottages. If he thinks he is justified from a national point of view in taking some portion of my income, and spending it in cottages instead of allowing me to spend it on a motor car or my garden, he is logically justified in taking the whole to spend it in building cottages all over the country. If his argument is correct the country would not be in the least hurt by it.
    Where the fallacy lies is here. He has no right to decide how a man shall work.
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    He is taking work away from a skilled artisan who makes motor cars, and he is giving to another man who builds cottages. He has no right to come down as an Almighty Providence, and saying, "I am doing no harm to the country by compulsorily turning a man who would otherwise get work as a motor-car engineer into a man who will build cottages," and to say, "You have got your cottage building work instead of your motor-car work, and you have got nothing of which to complain." Surely the thing is absurd. You have only to go to the man who is dispossessed of his work through my extra taxation—I am not saying this of all extra taxation: we realise sometimes that we must have some of it—but the argument I have tried to drive in, and I think somewhat successfully, with the people of Grimsby was that it all must fall sooner or later upon the shoulders of the working man. I perfectly frankly say to this House that by the action I took in regard to my motor car I personally am not very much hurt by the new taxation, but the man who would have got the job is considerably hurt by it. It is no answer on the part of the Chancellor of the Exchequer to say to that man, "You can go and build cottages somewhere far away from Coventry—in Dorset or in Northumberland."
    Sir F. BANBURY: Or in Wales!
    Mr. JOYNSON-HICKS: My hon. Friend near me says, "Or in Wales." Let me deal one moment further with my argument. In my speech at Grimsby I went to ask how is this money being spent. It is not necessarily being expended on cottages. The bulk of it—certainly my money and a good deal more—is being spent on the wages of black-coated officials whose number have been enormously increased under this Government. It would not, I agree, be in order for me to speak as to the enormous number of officials who have been created since the Chancellor of the Exchequer has been in office. They run, as of course the House well knows, into many thousands. It is not fair for the right hon. Gentleman to say to me, "Oh, yes, your working man will get good, solid work in building cottages." That is not at all the case. My working man will see that the money which should have gone to him is going into the pockets of the black-coated officials, friends of the Chancellor of the Exchequer. No one can say that that is work for working men!
    Mr. LLOYD GEORGE: We have had a very interesting account of the details of the personal expenditure of the hon. Gentleman who has just sat down, which I have no doubt is a very fair illustration and sample of the kind of argument that is being used on thousands of platforms, not merely at Grimsby, but elsewhere. The hon. Gentleman is very pleased with Grimsby. I can only congratulate him upon having been responsible for that result. But there is one thing that strikes me in something he said personal to myself. He said that "the electors of Grimsby evidently knew their Lloyd George." From that point of view, the only thing evident from the figures is that the more they know their Lloyd George the better they like him.
    Mr. JOYNSON-HICKS: The answer to the right hon. Gentleman is that that may be accounted for by the fact that they knew their Alf Bannister.
    Mr. LLOYD GEORGE: The majority has gone down very considerably. If the right hon. Gentleman's speech had that effect at Grimsby there are a few other constituencies where we might send him. If he produces an effect of 400 or 500 votes in a single constituency, we might send him about at the General Election to increase our majority very considerably. The hon. Gentleman has embarked upon a very interesting argument, and, inasmuch as it rather illustrates the general drift of the criticism which was initiated by the hon. Baronet who sits by his side, perhaps I might as well fasten my reply to the argument of the hon. Gentleman. The hon. Gentleman said, "Here you are taking money out of the pockets of the subjects of this country, and you are spending it upon objects which you yourself think very admirable, but which the person who pays may object to; you are setting yourself up as a kind of Almighty Providence, and you say, 'I am going to dismiss the gardener or the chauffeur of the Member for Brentford, and am going to convert him into a road mender, or into a builder in some rural districts.'" He says, "You have no right to do that." There is one thing I should like to ask the hon. Member and all those who take that line. Is there a single item in the expenditure for which I am raising this money for which I have not been pressed, not from one side of the House, but from both sides of the House to provide money? Not one!
    Captain WEIGALL: Land valuation.
    Mr. LLOYD GEORGE: I am coming to that. The hon. Member puts it now, and though it is not strictly relevant I will deal with it to show I am not afraid to face it. The hon. Member says, "Why do you not economise on land valuation?" As a matter of fact, I am not raising any of this money for the purposes of land valuation. That is not what has caused the increase. Suppose it were. The hon. and learned Gentleman who made a speech, and who is not present just now, said, "If you want to economise, economise ou the land valuers." If you economise on the land valuers, of course your land values go. If you get rid of your Land Taxes, and land valuers, you will be a loser on the account this year.
    Viscount HELMSLEY: Does that include the Mineral Rights Duty?
    Mr. LLOYD GEORGE: No, it does not. I left that out. It would not be fair to use that for the purpose of proving that land valuation costs less than the yield of the Land Taxes. I agree that the Mineral Rights Duty is not a subject of valuation, and I have left it out. So that, therefore, even if you treat valuation as annual expenditure, which no business man ever would do, because it is capital expenditure, at the present moment you would lose money if you got rid of it. Do not, therefore, let us talk utter nonsense about raising money for land valuation from these new taxes. I will get rid of another argument of the same sort, the argument about black-coated officials. Suppose you added the salary of every black-coated official who has been taken into either the Inland Revenue, or any other Department, during the last few years it would not amount to a farthing in the £ on the Income Tax. You may say that is too much, but when you are raising taxation of this magnitude do not let us try to mislead ourselves, and other people, by arguing that it is due to things of that sort. What is it due to? You must look at the great items of expenditure. If you get rid of the great items of expenditure, neither I nor any other Chancellor of the Exchequer would be standing at this Box to suggest in any shape or form any fresh taxes. The hon. Member wants economy, and the hon. Baronet wants economy. The hon. Baronet is the only one who is consistent, because in regard to some of the items which I am going to mention I cannot taunt him. He stands absolutely alone on the bench opposite. If you want

    1355
    economy you must direct your mind to these huge items of expenditure. What are they? The hon. Gentleman says. "You are taking away my chauffeur and gardener, and putting him on to something else." I will tell the hon. Gentleman to what I am putting him. I am putting him first of all on to the main roads of this country. That has been pressed upon me by every hon. Member on the other side of the House. The hon. Member repudiates the speech of the hon. Gentleman just behind him (Mr. Hicks Beach), but I was told that speech was a real contribution to the Debate, and I am sorry I did not hear it. He attacks his hon. Friend behind him, but he will not repudiate the action of hon. Gentlemen many a time in pressing us to find money for these great items. It is no use hon. Gentlemen who are sitting round him treating this as if it were a mere abstract idea about general expenditure and extravagance. If you want to bring down the Estimates tell us where you can bring them down! The items mentioned by the hon. Gentleman, and others, would not make the slightest difference to the taxation which I am proposing this year—not a penny, not a halfpenny! Why have I to do this? Every year since I have been Chancellor of the Exchequer—and not merely for that time, but in the years the Prime Minister held this office—there have been Motions from the other side of the House pressing the Government to incur the very expenditure which I am asking money for now. Here I must say that the hon. Baronet the Member for the City of London—if I am wrong he will put me right—departed from his usual course. He voted, I believe, for all those Motions—
    Sir F. BANBURY: I am not sure. It is very difficult to say whether I did or not. Unless the right hon. Gentleman says definitely I did.
    Mr. LLOYD GEORGE: Yes, I will tell the hon. Baronet. I will give him the three Motions of the right hon. Gentleman the Member for Fulham demanding that we should immediately vote money out of the Exchequer for the purpose of relieving the local rates.
    Sir F. BANBURY: No, I did not vote for that.
    Mr. LLOYD GEORGE: I accept that. Therefore the hon. Baronet's record is a perfectly unstained one—without a
    1356
    blemish! I can quite understand, therefore, why he is the only one to get up now and criticise with a good conscience the raising of the Income Tax by twopence. He can do it. He voted, I believe, against old age pensions. I really forget whether he voted against the insurance Grants.
    Sir F. BANBURY: I voted in favour of the reasoned amendments.
    Mr. LLOYD GEORGE: Well, at any rate, that is fairly good. I think he is entitled to stand up and protest against the increase in the Income Tax, but there is no other hon. Member on that side of the House entitled to do so. What is the complaint against me. The hon. Gentleman (Mr. Joynson-Hicks) is one of those who met me very fairly, for he complained that I had not found the money before. Year after year I was pressed to find this money as if I were a kind of Almighty Providence that had a right to pick and choose, and say the people's money must be spent on this, that, and the other. It is the House of Commons that does these things. They make the demands upon the Government, and they find the cash. I do not want to make a mere party point, but what is it that has been the most embarrassing Motion to the Government? The most embarrassing Motion was that on local taxation. I knew there were so many men on our own side of the House who sympathised with many men opposite upon this question. We were always taunted with doing nothing, and it was a very awkward Motion to get over. Yet, for five or six years, I faced the House of Commons, and gave the best reasons I could for not finding the money. I am not sure that the Noble Lord opposite had not a Motion on this subject one year.
    Viscount HELMSLEY: Yes, I had.
    Mr. LLOYD GEORGE: Yes. I remember perfectly well. And now he turns round when the Government and the House of Commons are practically unanimous, and says the moment we are finding the money, "You are raising the taxes."
    Viscount HELMSLEY: No; what some of us complain of is that the Chancellor of the Exchequer is not giving this money merely for the relief of local rates, but that he is at this moment increasing the services that they have to meet.
    Mr. LLOYD GEORGE: I am not increasing them at all.
    Viscount HELMSLEY: Is none of the money for new services?
    Mr. LLOYD GEORGE: About one-fourth.
    Viscount HELMSLEY: Two millions or three millions?
    Mr. LLOYD GEORGE: The latest objection of the Noble Lord is that portion of the cash is to be used for new services. I should like to know to which portion he objects—for instance, there is some portion for technical instruction—
    Mr. AUSTEN CHAMBERLAIN: I really must ask whether we are to be allowed to answer the questions which the Chancellor of the Exchequer is putting. Some of us would like to, but I should think it would not be in order?
    Mr. SPEAKER: I also said that the Front Bench had no privileges beyond those which other benches enjoy.
    Mr. LLOYD GEORGE: I am very grateful, Mr. Speaker, for the kindly hint you have given me. The charge throughout is not that putting 2d. on the Income Tax is unfair, but that I have no business to raise the Income Tax now, and that I am squandering the money in some sort of way. I am not trying to get round your ruling, Mr. Speaker, but it is rather difficult to answer that. Perhaps I may be allowed in a general way to make this point—I am not spending any money that I am not pressed from both sides of the House to spend. I should like to say a word or two in answer to the hon. and learned Gentleman the Member for West St. Pancras (Mr. Cassel). The hon. and learned Member said during the time you have been Chancellor the expenditure has gone up on the average 7½ millions.
    Mr. CASSEL: Per year.
    Mr. LLOYD GEORGE: Spread over a period of six years. Taking that, I should like to know what the hon. and learned Member objects to? Four millions out of that is for the Army and Navy. There is not an hon. Gentleman on the other side who has not very grave suspicions that we are not spending enough on those Services. Does the hon. and learned Member think that I am responsible for having put up the expenditure on the Army and Navy?
    Mr. CASSEL: Yes.
    Mr. LLOYD GEORGE: Then he is the only one that does.
    Mr. CASSEL: Perhaps I had better explain. It was the reduction originally made by the Liberal Government which led foreign Governments to increase their armaments.
    Mr. LLOYD GEORGE: The hon. and learned Member was making a point about the time I was Chancellor of the Exchequer. Whatever reductions were made, there have been none while I was at the Exchequer, and, if he takes the period preceding that, the average is certainly not 7½ millions, but considerably lower, and is about 5 millions. The hon. and learned Gentleman cannot have it both ways. The hon. and learned Gentleman picks out this period when it suits him, and when it does not suit him he takes the preceding years. That is a sort of criticism to which I object. He does not object to the expenditure on the Army and Navy. In regard to old age pensions, he not only voted for it, but for an increase.
    Mr. CASSEL: May I inform the right hon. Gentleman that I was not in the House at the time?
    Mr. LLOYD GEORGE: I apologise to the hon. Gentleman. He came in in 1910, but Members on the other side generally not merely voted for old age pensions, but voted for an increase in them, and the only hon. Member who did not do so was the hon. Baronet the Member for the City of London.
    Mr. HICKS BEACH: I voted against it.
    Mr. LLOYD GEORGE: I know there were a few. [An HON. MEMBER: "Thirteen!"] I think it was thirteen. That is a very unlucky number. All this is expenditure which the House of Commons has demanded, and it is no use saying that it is expenditure which I have started and invented, or assigned out of my head. It is House of Commons expenditure, and the House of Commons having pressed the Government to spend all this money, the question now is: Is it prepared to foot the bill, and how is it going to do it? The hon. Baronet opposite objects to 2d. being put upon the Income Tax. I think he indicated that I should have put something on indirect taxation. I had that experience in 1909. I divided the amount which I raised between direct and indirect taxation, and what happened? The indirect expenditure

    1359
    was, of course, unpopular. I was prepared to face that. How many hon. Members on the other side were?
    Sir F. BANBURY: I was.
    Mr. LLOYD GEORGE: There is the virtuous one again, but the bulk of his party found it was unpopular to put a tax upon tobacco, and upon whisky, and they were prepared to take advantage of that difficulty of the Government and they fought against us. There, I attempted to divide quite fairly the amount we were receiving between direct and indirect. Then we had a large majority. I have not the faintest doubt that if I proposed now to divide this amount between direct and indirect I should find the whole body of the Opposition, except the hon. Baronet the Member for the City of London, voting against us. Take the case put by the hon. Gentleman the Member for Brentford. The hon. Member would like to see a 1d. Income Tax upon wages. That is a proposal which, of course, Chancellors of the Exchequer have always got to consider. It is done in Prussia, Saxony, and some of the German States, and produces, a good deal of revenue. There are ways of collecting it quite simple and quite cheap. Does anyone imagine that if I put that down as one of my proposals, and hon. Members on the Labour Benches opposed it, that the Opposition would not join them. I had my experience of that over the Insurance Bill. Instead of putting £150,000 on to the Income Tax payer, I proposed that the workman should contribute what was called a tax. It was denounced as the imposition of a tax. The unpopularity of making the workman contribute was exploited in every constituency throughout the country. The fullest advantage was taken of that by the vast majority of the Opposition. It was denounced as a tax. I know there are some hon. and right hon. Gentlemen opposite who did not do that. I never saw the right hon. Gentleman the Member for East Worcester do it. I never saw him during the time the Bill was going through the House of Commons pressing the Government for more expenditure, but there he was almost alone, except for the hon. Baronet the Member for the City, and I assume now that the hon. Baronet's record is so clear that it is hardly necessary to mention him any more. Hon. Members now say, Why put Income Tax upon such a small number? Under the Insurance
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    Act I put a share upon 14,000,000 of workmen, and ever since that fact has been exploited, to the detriment of the Government, and if I had done the same thing now, it would be denounced throughout the country on every platform. I do not say that this is not a serious matter; but it is a matter which ought to be considered even more by the Opposition, than by the Government. I have called attention to it once or twice before in this House. I knew perfectly well that to make the workmen pay 4d. a week, whether as Income Tax or otherwise, was not a popular thing. I knew what the effect of its being exploited was, and that it must be an inevitable warning to all Governments and Chancellors of the Exchequer when they wanted to have taxation distributed fairly over the community. I am not sorry that attention was called to it, but the lecture ought not to be addressed to me. The hon. Baronet ought to turn round, within the limits of order, and address his observations not to me, but to hon. Members behind him.
    Sir F. BANBURY: They are not in power.
    Mr. LLOYD GEORGE: No; but any Opposition has sufficient power to make it almost impossible for any Government to carry proposals of that kind. So much, therefore, for these two points. The first is that, speaking generally, the whole of that expenditure is expenditure by the House of Commons as a whole, pressed upon the Government over and over again; and the second point is that with regard to the extension of indirect taxation. I think I have dealt with most of the points. There are one or two other small points to which I want to refer. One was the point raised by my hon. Friend (Mr. Lees Smith), who made a very admirable suggestion with regard to the method of collecting Income Tax on incomes below £500—having regard to the concession which the Government have indicated. With regard to that I think I can assure him that is the course that will be pursued where it is practical, but it will not always be practical. It seems to me a very admirable suggestion, and I will consider it, and I think in many cases it can be done. The hon. Member opposite (Mr. Cassel) raised a point with regard to the position of married women. I understand him to contend that a married woman's income ought not to be added to that of her husband for the purpose either of determining

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    the scale of payment whether the combined income comes under the Super-tax or whether it comes below that rate.
    Mr. CASSEL: No, that is what I would have asked for, but I knew the right hon. Gentleman would not give it. What I asked for was a special exemption in the case of married women.
    Mr. LLOYD GEORGE: With regard to the first suggestion, even on the old tax, it would have cost the revenue £1,500,000. The hon. and learned Gentleman said if it is just it ought to be done. The effect would be to put up the taxes of other persons, and the point is whether they can, in justice, demand that other people should bear the burden of £1,500,000 in order to redress what they regard as an injustice. I think the question is the income which is available for the purpose of running the household.
    Viscount HELMSLEYmade a remark which was inaudible in the Press Gallery.
    Mr. LLOYD GEORGE: That is another point which the Noble Lord will no doubt make when we come to the Death Duties. I think this is a perfectly fair thing to do; otherwise, you would find that another person whose available income for household expenses was very much lower would have to pay a higher tax. I think that would be very unfair, and I do not see my way to do that. What I can see my way to do is what I suggested last year. I agree that it is humiliating that a wife in those circumstances should be treated as a perfect cypher and of no account, and that the whole of the account should pass in the name of the husband, all returns having to be made by him, although in some cases it is the wife who is earning most of the money. This point was very well put before me by a deputation which waited on me last year, and I have promised to the best of my ability to put that matter right. I think, however, that the Revenue Bill is the place to do it. The hon. and learned Gentleman said that last year there was a Resolution which ought to have been made to enable me to redress the grievance which I have admitted. That will be moved when the Revenue Bill goes to Committee. But that is not a Resolution in Ways and Means, and therefore it is not necessary to move it now. Even if it were to be dealt with in the Finance Bill I should move it later on. It will be moved when the Revenue Bill gets into Committee in order that it
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    may be dealt with. The right hon. Gentleman has spoken of the disparity between earned and unearned income. I do not agree that that disparity is a very substantial one. Supposing the right hon. Gentleman went to an insurance company or to Lloyd's, or anywhere else, with the case of a man earning £750 a year in a profession, in business, or in the Civil Service, and he asked, "How much will you guarantee that income for, say, for twenty years?" The right hon. Gentleman would find the insurance very heavy indeed.
    Mr. CASSEL: It depends on the age.
    Mr. LLOYD GEORGE: You may take almost any age. It is not merely the age, but it depends upon all sorts of things, such as the man's conduct, his work and capacity, and upon all sorts of circumstances and conditions over which he has no control. I do not think it would be an insurable proposition. If, on the other hand, a man is deriving £750 from the investment of £15,000 or £20,000, that is a very different proposition. There is a vast difference between the two, and I think the Prime Minister established a principle which ought to have been embodied in the Income Tax years ago. It is a perfectly fair and sound proposition, and I cannot for a moment admit that the disparity between the two cases is not adequately and fairly represented by the difference between the charge on the money in both cases.
    Mr. CHAMBERLAIN: The Chancellor of the Exchequer has dealt very briefly with some detailed cases of hardship alleged by my hon. Friends behind me. I propose, like the right hon. Gentleman, to say the fewest possible words about them. I shall not take them in detail, but speak of them in general terms. When the attempt was made to differentiate between earned and unearned income I pointed out a great many of the grievances which have since been complained of by the taxpayers. I think the Chancellor of the Exchequer only adds to his difficulty in defending this distinction by the nomenclature he has employed. If the right hon. Gentleman called it a distinction between income from present exertion and income from investents it would more correctly represent the actual distinction than when he called it a differentiation between earned and unearned income. I will take a particular case put by an hon. Friend of mine of a

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    professional man who, by hard work and economy, saves a modest retiring allowance for himself, every penny of which has been created by his own effort. The moment he retires and ceases to earn fresh income you treat the whole income which he had, all of which comes from his own exertions at an earlier period, as unearned. His receipt of income is due to his exertion, and he has earned every penny of it. That is the only point. Suppose a man entered upon a different career, and went into the service of the State, and made no provision because the conditions of his employment entitled him to a pension. Suppose he entered the service of a railway company or a bank, which has a pension scheme, and therefore the man feels it unnecessary to make provision for himself. His retiring allowance would be treated as earned income, though he is not then contributing to it in any sense in which the retired man has contributed to the retiring allowance which he has provided for himself, because no pension is attached to his exertions. I am bound to say that when once you try to establish the distinction in any form you are certain to have cases on the border line which will be of great hardship and anomalies which you cannot explain away, and certainly which you will never be able to explain away satisfactorily to the people who are aggrieved by them.
    I think the nomenclature of the distinction is peculiarly unfortunate, because it does not bear any real reference to what the actual distinction is. In regard to this and the other case of married women in particular, I only want to say again what I think was said by one of my Noble Friends below the Gangway in an interjection, that of course every one of these anomalies which might be tolerable and insignificant with a low tax, becomes a severe burden and a great source of irritation when you get the tax to the height to which it has now been brought. This brings me to the more general side of the Chancellor of the Exchequer's observation. I confess to an unfeigned pleasure listening to the Chancellor of the Exchequer on occasions when he paints himself to the House as he sees himself. I think in the exuberance of an after-dinner speech the right hon. Gentleman described himself as a saint. He painted himself like a figure in a church window this afternoon of the good man struggling with adversity—the martyr of adverse influences brought to bear on him from all
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    sides of the House of Commons. He says that expenditure is pressed upon him from all sides. That is quite true, but that does not differentiate him in that respect from any of his predecessors since the mid-Victorian epoch. If I may refresh his memory on this point, I would say that if he would refer to his speeches he would find even Mr. Gladstone, in the heyday of Gladstonian finance, when bringing in his great Budget, complained that the House of Commons had no care for economy. It always will be so. The right hon. Gentleman is not so much to be pitied as to be congratulated in that respect, for I know that there are two hon. Gentlemen, at least in the regular Opposition, who have never pressed him to exceed his own estimates of expenditure. After all, each man will come to the House, as each Department will go to the Chancellor of the Exchequer, with his own pet scheme and his immediate grievances and ask to have them remedied. The business of the Treasury is to bring all these different demands into focus and compare them with the resources of the country, and what I say is that the Chancellor of the Exchequer and the Treasury under his administration has been so much interested in spending that the right hon. Gentleman has ceased to exercise the kind of control that his predecessors in office, whatever party they belonged to, were accustomed to apply to the demands which were pressed upon the House of Commons and always will be pressed.
    I do not think it is any answer to the criticisms put forward to call upon us to single out a particular item and say, "I object to that." I do not say that when the proper time comes some others may not object to particular items of expenditure. At any rate, I rose to order while the Chancellor of the Exchequer was speaking, and, of course, I cannot enter into that question now, and, indeed, it is not the time to do it. Suppose it is admitted that every individual item is good, it does not necessarily follow that every individual reform ought to be carried out at once, or that it is wise and in the interests of the country that expenditure should go on at this rate. My complaint against the Chancellor of the Exchequer, to put it in general terms, is that he has made the pace too hot, and that it is he who set that pace much more than the House of Commons. The right hon. Gentleman says that we urged all this expenditure upon him, and it is now for us

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    to say whether he will foot the Bill. Even those who have urged expenditure upon him in a way which I had never done—having occupied that office, I felt that it did place upon me responsibilities different in degree from those which apply to hon. Gentlemen who have not had that happy experience—have a retort to his present argument. The Estimates of the present Government of the expenditure they are inviting the House to sanction have been singularly wide of the mark. Take old age pensions. I did not vote against the Old Age Pensions Bill, but I never throughout the discussions attempted, in this House or outside it, to conceal my opinion that it ought to have been a contributory scheme. In my opinion, it ought to have been linked with the provision for infirmity which the Chancellor at a later date made in the insurance scheme. I believe, if you had put those two together on a contributory basis and had left the sick arrangements to have been made by the people themselves, we should have spent much less money, and should have spent it much more effectively than we have done under the present circumstances. And not only have spent it more effectively, but with more gratification to the classes on whose behalf the expenditure was undertaken, and who in regard to the insurance part of it have to make a direct contribution. Is it quite fair to say, "You urged this expenditure on us, and now you are reluctant to foot the bill"? What did the Government say about old age pensions? They said, "The scheme which we propound to you will cost £6,000,000." It has cost £12,000,000, and more. They cannot say that is the result of the alterations which were made. Yes, I see the Chancellor of the Exchequer wants to say it.
    Mr. LLOYD GEORGE: I do not say all of it.
    Mr. CHAMBERLAIN: Thanks to the Chancellor of the Exchequer, we know pretty well what part of it. He was asked by the hon. Member for the Skipton Division of Yorkshire (Mr. Clough) what he estimated would be the full totals of the moneys which would have to be provided by Parliament to meet the payment of the old age pensions after the Bill had been read a third time in the House. That was after all these Amendments had been put in. He said:—
    "The concessions made in Committee are estimated to increase the cost of the scheme in 1909 by approximately £500,000."
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    I give him something extra for succeeding years for the full cost of those concessions.
    Mr. LLOYD GEORGE: I was referring to the addition of the paupers. There was an amending Bill in a subsequent Session which was certainly pressed upon me from all sides of the House and which cost—I am only quoting from memory—something like £3,000,000.
    Mr. CHAMBERLAIN: I was going to set my memory as to the cost of that against that of the Chancellor of the Exchequer, but I will not do so. I agree that the new Bill did make a very considerable additional charge, but, taking your Estimate of £6,000,000 and £500,000 as being the cost of the further concessions made while the Bill was going through the House, and comparing that with the actual cost without the addition of the paupers, can anyone say that the House had a fair opportunity of judging the scheme when the Estimates of the Government were as reckless as that? The right hon. Gentleman must give up the idea that any Chancellor of the Exchequer in these days will be seriously helped by the House of Commons, whether from the Opposition or from his own side, to resist the growth of expenditure. After all, we have someone who ought to exert that self-restraint which the House as a whole may show, but which you cannot expect from individuals without that responsibility, and that somebody must be the Chancellor of the Exchequer. The Chancellor of the Exchequer the other day, in the speech with which he concluded the Committee stage of our Debate, said that after all this Income Tax was not a very high one, that a new world had been called into existence, with new needs, new aspirations, and new power, which it was now beginning to recognise, and his successor, be he whom he might, could not sit in the comfort or the lethargy of old days, if he thought there was comfort or lethargy. They could not sit at the ease which he rather suggested his predecessors had done, and say, "I will not find the money." He said, "You rich men, and men of moderate wealth, ought to be ready to pay, and glad to pay, an Income Tax of 1s. 4d. in the £ as an insurance against revolution." The House of Commons, partly because of its rules, partly because of the names of the taxes, and partly because it is our natural habit of mind, will treat each tax separately as it comes up before the Exchequer, and it does not put them together.
    Mr. LLOYD GEORGE: And each item of expenditure as well.
    Mr. CHAMBERLAIN: Exactly. That was what I said earlier. Now I come to the taxation. They treat each tax separately as if one had no bearing on the other. A particular tax is picked out, like the Tea Duty, for instance, and it is attacked. There are objections to the Tea Duty quite apart from the difference of fiscal opinion between the two sides of the House. There are objections to a rate of tax so high ad valorem. It is asked ought the poor man to pay so much in the £ when the rich man only pays the same amount. If that were the only tax, and was judged by itself, it would be, of course, grossly unfair, but you compensate it by other taxes, and so it is grossly unfair for the Chancellor of the Exchequer to pick out the Income Tax by itself as being the only insurance which a wealthy man pays, if we are to put it in that way, against revolution. I asked the Chancellor of the Exchequer for a return which, on alternative bases, would convert the Death Duties in so far as they can be converted—that is without Succession Duty and without Settlement Duty—into terms of Income Tax. You must put them in terms of Income Tax and add them to your existing Income Tax before you find out what is the contribution which you are exacting from these people. I made a calculation with a friend the other day, very much on the basis of Sir Henry Primrose's calculation, of what might be the annual sum in the £ which a man owning a landed property with a capital value of £150,000 would pay year after year if he paid his Income Tax, his Super-tax, and such an annuity as would replace to his heir the slice of property taken away by those Death Duties. I know that the Chancellor of the Exchequer disputes the merits of the basis taken by Sir Henry Primrose, and you must take it on behalf of the Board of Inland Revenue at that time. I just mention that because I should like the House to bear it in mind that it was taken when the Prime Minister was Chancellor of the Exchequer, and therefore not at all under my inspiration. I do not suppose that it was taken under his. It was the independent view of the Board of Inland Revenue at that time. At any rate, it was not taken under my inspiration.
    Taking that calculation, my friend whom I consulted and myself made out that a man with a landed estate of
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    £150,000 coming into the estate at the average age and with the average expectation of life would pay 5s. in the £—a little more or a little less—for the term of his enjoyment of the estate. When the Chancellor of the Exchequer talks about these taxes as an insurance against revolution, I venture to assert that when rates at Lloyd's get at 25 per cent. it is generally only when there is a danger or a serious expectation of a total loss. The Chancellor of the Exchequer is asking a very high insurance if indeed figures of that kind at all represent the rate at which property is charged. In my opinion, as the House knows, it was inevitable in the circumstances of this year that there should be a considerable increase in direct taxation; but I am bound to say that when he was obliged to make such increases as he is making in this Budget I do think the right hon. Gentleman would have been well advised, in the first place, to have exercised a greater control over the new services that he is seeking to create and a stricter economy in regard to them, and in the second place, I agree with my hon. Friend the Member for one of the Divisions of Gloucestershire that when so much of this expenditure is being raised for the benefit of the poorer classes of the community, and when more money is wanted for the same purpose, it is right that they should make some further contribution, however small it be, to the sum which has to be raised That is my objection to the Income Tax Resolution of the right hon. Gentleman as it is now before the House, taking it, as I have to take it, in these general considerations, not by itself only, but in connection with the other direct taxes which he charges.
    Mr. LLOYD GEORGE: May I just correct one figure of the right hon. Gentleman? He said that I had estimated the cost of old age pensions at £6,000,000. That was not my recollection. I have refreshed my memory, and I find that on 15th June, 1908, I said that the cost of the scheme would eventually be, if these figures were worked out, £7,500,000. That was before it went into Committee. I seemed to have estimated the amendments at £550,000. That brings it up to over £8,000,000, and subsequently there was a scheme to include the paupers, which cost nearly £3,000,000.
    Mr. CHAMBERLAIN: What is the date of that?
    Mr. LLOYD GEORGE: 15th June, 1908. It is on the Second Reading of the Bill, page 571.
    Mr. CHAMBERLAIN: If I may be permitted to rejoin, I would point out that he subsequently revised his estimates, and on 23rd July he put it at £6,500,000.
    7.0 P.M.
    Mr. GORDON HARVEY: The hon. Member for Brentford (Mr. Joynson-Hicks), who spoke a few minutes ago, spoke of the Super-tax fishermen in Grimsby, who, in trembling tones, said they knew their Chancellor of the Exchequer. I think, with the knowledge that has come to us, we may congratulate ourselves on this side of the House that they do know the Chancellor of the Exchequer, and appreciate him in an ever-increasing manner. They appreciate him for his vigour, for his enthusiasm, and for his large-hearted devotion to the cause of the people. I rise, however, rather to criticise than to praise. I feel it my duty to say that, in default of more precise details with regard to the expenditure proposed, I shall find it very difficult to vote for these Financial Resolutions. Indeed. I must protest as strongly as I can with regard to the whole method of procedure that we are adopting in this House. Let me say at once that if the expenditure which would follow this taxation now proposed to be imposed could be proved to my judgment to be wise, necessary, and desirable expenditure, I have no suggestion to make as to how the money could be more fairly provided than under the proposals of the Chancellor of the Exchequer. With regard to the objects, although I cannot discuss these now, I may perhaps be allowed to say that the purposes for which this money is to be raised appear to me to demand most favourable and respectful consideration from both sides of the House. As the Chancellor of the Exchequer has told us, both sides have demanded the relief he proposes to give, and on broad lines all parties in the House have supported his idea, but I do submit that these proposals ought to have consideration of the fullest and most particular kind, and that consideration must, in my opinion, precede the granting of Supplies.
    I, like other Members in this House, feel myself under a great responsibility in this matter to those whom I represent. I feel responsible both to those on whom the Chancellor of the Exchequer is making the demand for sacrifice, and I also feel
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    responsible to those who will benefit by the money so extracted, because, after all, we may talk of the wealth of the great rich if we like, but the amount of money we get from them in the end must be a limited sum, and the people who are to be benefited by the taxes which rich men pay are very much interested to know that that money is spent in the best possible way. The ease with which nowadays Chancellors of the Exchequer have proved that they can extract money from the rich is, I am afraid, creating something of financial levity both in this House and outside. I have listened to Friends of mine on this side of the House—I may, perhaps, mention the hon. Member for Northants (Mr. Chiozza Money), who appears to me to glory very much in the size at which our national Budget has arrived. I cannot associate myself with him in such ideas. I know, indeed we all know, that it has been the habit of late years to increase the national expenditure, and as the Chancellor of the Exchequer has shown, both sides of the House have demanded it. Again the growing recognition of the needs of the people compel it. We shall have to go on spending money, and I am particularly interested, as I hope we all are, to see that the money is judiciously and wisely expended. Nor am I content to try to prove—as some of my hon. Friends seem to be—the possibilities of endurance of the taxpayer owing to the great growth of national wealth. Of course, the nation will not become bankrupt under the present proposals of the Chancellor of the Exchequer, or under any proposals likely to be made. Neither will those upon whom the new taxes are being placed really suffer serious inconvenience in these days, notwithstanding the fact that the hon. Member for Brentford (Mr. Joynson-Hicks) has had to postpone for one year the purchase of a motor-car.
    Mr. JOYNSON-HICKS: I explained that I had suffered no inconvenience, as my old car, repainted, suits me quite as well. It is the working men who suffer the inconvenience.
    Mr. G. HARVEY: I have no doubt that the newly painted car of the hon. Member must look most resplendent, especially when it is decorated with his figure when he comes down to this House. Of course, the country can bear the strain now put upon it, but, on the other hand, I have a settled conviction that a very great deal of

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    the money which the Chancellor of the Exchequer obtains would be very much better employed if it were left under the control of the people to whom its existence is due. Although the hon. Member for Northants appears to think that, after a man has reached a certain standard of income, everything in excess is spent in useless luxury, and although a great Liberal paper to-day had the courage to state that these taxes upon the rich will only make them smoke a cigar less occasionally or drink a little less of the flowing champagne, I think many people can spend their money even if they are overwhelmingly rich quite as wisely as the Government has ever shown itself able to do. We talk of the broadest backs, and we decide to lay our burdens upon them. The first principle is intrinsically a right one; nay, more, it is very convenient for the Chancellor of the Exchequer to collect money in this way when it comes rolling in in big lumps, as it does in the case of the Income Tax collected at the source. But I do submit that, in some cases at any rate, there is some danger of crippling the provision for extended employment if the Government spend too much.
    We pride ourselves in this country on an immense and well-founded commerce. That commerce—that trade—has been a plant of slow growth, and it will always be a very sensitive creation. It has been subject to no sudden eruptions of success, and I will ask those who deal with national finance to remember that there are countless cases to-day representing an enormous proportion of our industries which have grown up from the minutest beginnings which are now large enterprises employing many persons, and which have been nourished entirely on the accumulated savings of persons—savings carefully made up and often put aside at the expense of considerable self-denial. In my experience of business I know that for £100 you can capitalise the work and energies of a man, and I do not think that we ought to draw from that useful purpose a single £100 that can be possibly avoided. I am only saying these things because I desire that we should be very careful in what we are doing. I do not wish to object to the measures upon which these great sums are to be expended. Perhaps I am too cautious, but I was brought up in close contact with one or two of the greatest political economists of the time. The teachings of Cobden and of Bright do weigh with me, although I am willing
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    to admit that things are changing and must change, and that the State is assuming, and must assume, responsibilities which would have been impossible and intolerable in the eyes of those who preceded us. I know for the performance of these services much money must be found. In outline I agree with the proposals and with the objects on which the money is to be spent, and it seems to me, on the whole, if the money is to be found, the Chancellor of the Exchequer is going to the right source for it. But at any rate I may be allowed to make a respectful protest in this way, and to say that if the Chancellor of the Exchequer has a deficit, as he has, he is right to provide for it. But that he should give us a mere outline of his programme is something with which I can hardly agree, and I do sincerely hope the right hon. Gentleman will lay before us details and specific plans, so that we may find no difficulty in supporting him.
    Captain CLIVE: I have had much pleasure in hearing the reasoned protest of the hon. Member who has just spoken against the excessive increase of the Income Tax. As one of my hon. Friends observed just now, the mere fact that mutton is good does not imply that you cannot have too much of it, and in the same way, although the Income Tax may be the best instrument for raising taxation, it will be a very grave danger to the nation should that machine be used to excess in time of peace. The hon. Member for Rochdale (Mr. G. Harvey) took exception to the illustration cited by my hon. Friend the Member for Brentford (Mr. Joynson-Hicks) in relation to his own motor car. But I think we can all agree in the principle which my hon. Friend advanced, and it would be well for everyone who supports that principle to emphasise, as he did, the fact that this large abstraction of income from rich people must mean a diminution of employment, almost to the extent of that abstraction. The hon. Member for North Salford (Sir W. Byles), who spoke earlier, expressed his desire that every tax should be felt, and he gave that as his reason for advocating an ever-incerasing amount of direct taxation and an ever-diminishing amount of indirect taxation. We have all heard of the courage of the hon. Member. We know that if he had his way he would advance on Ulster with sword drawn. We also know now that he is extending his activities to another sphere. He objects to what he calls

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    the painless dentistry of taxation. He would go into the dentist's chair and would say, "Make me squirm, and then I shall feel that you are earning your fee." If that is his view, I contend it is not being carried out by this Budget, and he can only think it is if he is under the impression, which I hold is quite erroneous, that it is the Income Tax payer and the Super-tax payer who dictate the policy of this country. It certainly is nothing of the sort, and those who talk with alarm of this incrasing Income Tax do so very largely because they realise it is the many who dictate the policy, and the few who have to find the money.
    The general opinion has been expressed that it is more than ever incumbent on the Government and the Treasury to make the machinery by which Income Tax is collected as perfect as possible if the Income Tax is to be increased to such a large extent. Obviously, we are going to use it more and more in the future, and the more we use it the more such anomalies as exist will grow. Therefore, it becomes more than ever essential that those anomalies should be abolished. The Chancellor of the Exchequer has done one or two things in that direction. He has abolished the perfectly indefensible limit of 25 per cent. on the allowance made in respect of repairs on agricultural estates. As the House knows, until now, even if an agricultural landowner or the owner of houses can show that he has spent practically the whole of his income in a particular year, or on an average of five years, in repairs to his estate to maintain the rent without increasing it, he can only have 25 per cent. reduction. Although the Chancellor of the Exchequer was not very sympathetic last year, he has now removed that, but the grievance will not be removed except by putting all classes of Income Tax payers under Schedule D. In these days, when nearly all Income Tax payers, for one reason or another, are made to declare their incomes, Schedule A has become almost obsolete. It would simplify the whole scheme of Income Tax if Schedule A were abolished and the whole tax collected under Schedule D. The man who comes under Schedule A is made to pay more than is right, and can only get a reduction after he has successfully proved, with an elaborate set of figures going over an average of five years, that he is entitled to it. Those who come under Schedule D can in no circumstances pay too much. A person makes a certain declaration of income, or, if he prefers
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    it, the Income Tax Commissioners assess him. If they think they have underestimated his income they raise it, and continue to do so until they get to a mark when he appeals and gets it brought down again. If that is fair for one class of Income Tax payers it ought also to be fair for every class.
    I hope my hon. and learned Friend (Mr. Cassel) will not rest satisfied with the Chancellor of the Exchequer's reply as regards the grievance of married people. I cannot understand how the Chancellor of the Exchequer is able to dismiss that grievance with so little sympathy. His chief argument seemed to be that though there was some justification for the grievance, it would cost £1,500,000, and he asked who is to pay that. I suppose that the Income Tax and Super-tax payers are the principal contributors to taxation at the present day, and that they are not married. I do not know why, if the grievance is admitted, it should not be removed simply because it is the bachelors and those who are not married who would have to pay a little more. It is a distinct grievance that the two incomes should be reckoned as one. In the case of married people we have the old age pensions, and the system now is to add the incomes of the two married people together and to ascertain whether either of them who is over seventy is entitled to receive an old age pension. If that system is right in the case of old age pensions, is it not also right in the case of married couples who are charged with Income Taxi As to the curious little bit of sentimental legislation the Chancellor of the Exchequer has introduced, namely, the abatement for Income Tax payers with an income between £160 and £500 a year who have children, I suggest to him that better use might be made of the money he gives back under that heading. I do not see what particular claim to special consideration is enjoyed by those who have only one child or two or three children. It is only reasonable, when a man is married, that he should consider whether he is able to afford the expense of a moderate family of that size. In considering the minimum wage, the chief consideration is whether the wage will support a family of five. It is only when the family is increased beyond that number that they are deserving of any consideration. I have always thought that the social legislation of the future ought to be in the direction of helping the working class families which are

    1375
    beyond that average number. It is not justifiable that only a particular class should receive assistance, namely, those persons whose incomes are over £160 and under £500. Instead of doubling the amount given back, and therefore doubling the anomaly, the right hon. Gentleman should have gone a little deeper into the matter and tried to distribute his benefits more equally among those who ought to receive them.
    Members on this side of the House have been very indulgent in this Debate by not filling up the time by suggesting alternatives to the high Income Tax. The Chancellor of the Exchequer is inclined to jeer at us for not having done so. I am not one who has rubbed in Tariff Reform in and out of season, but I marvel that the Chancellor of the Exchequer, who has shown himself to be not tied to the rigid letter of Free Trade, as, for example, in his Patents Act and his refusal to put an Excise Duty on home-grown sugar, when so large an increased sum is required, should absolutely refuse to put any sort of tax on foreign imported luxuries. Luxuries produced in this country are taxed. We tax spirituous liquors and tobacco because they are luxuries, and they happen to be the luxuries which the poor enjoy as well as the rich. There is a great number of luxuries which are especially enjoyed by the rich, but which contribute nothing to the welfare of the country, and I wonder how much longer it will be before we put some form of duty upon them. In these days when exemptions are being extended in various directions and made more complicated, it is very essential that the whole staff of the Treasury throughout the country should not only be collectors of Income Tax, but should be, as far as they can, the friends of the Income Tax payers. It should be as much their duty to explain to all Income Tax payers in what way they can obtain exemption as it is their duty to insist on the last penny due to the Treasury being collected. It is not an honest or an honourable attitude for the servants of a great country to say, "I have got so much from that man. If he does not know what the law is and that he is entitled to such exemption, it is his own fault, find the more fool he if he does not claim the exemption." I have no doubt that a large sum is collected through these exemptions not being claimed. Instructions should be given to the surveyors of taxes, and those
    1376
    who come in contact with the poorer Income Tax payers throughout the country, to make known, as far as possible, the benefits the Chancellor of the Exchequer has thought right to give to certain classes of Income Tax payers.
    The hon. Member for Blackburn (Mr. Snowden) wishes to go a great deal further than the Chancellor of the Exchequer has gone at present. In his speech the other day he said that he saw no reason why a man with £10,000 a year should not be taxed until his income is reduced to £5,000. In the first place, I would suggest to the hon. Member that he presupposes that everybody who enjoys £10,000 a year has it in readily realisable income, with no charges upon it, and that if one-half is taken away, the other half would be enough for all they need for personal purposes. That is not the case. I cannot but note, in passing, that the hon. Member stopped at the figure of £5,000. I do not know whether that was because he had an eye to a seat off the Treasury Bench, to which his abilities would justly entitle him, or whether he was taking the precaution to avoid the trap into which his former colleague, the President of the Board of Trade, fell when he declared that £500 a year was enough for any man. I find it impossible to say that some increase in the Income Tax is not essential at the present moment, but there is very grave danger to this country in the readiness with which the Chancellor of the Exchequer has had recourse to that means of raising money, without looking about at all for any other source of income. There is great danger in the enthusiasm that appears to exist among a good many hon. Members opposite in that we have reached figures of over £200,000,000. No alarm is expressed, and there is no apology by the Chancellor of the Exchequer that such a charge should be laid on the country. He has confessed that he is one of the greatest offenders in increasing the amount and raising the charge, instead of being, as former guardians of the Treasury have been, the one who stood in the way of every new expenditure.
    Mr. WALTER REA: I congratulate the hon. Member who has just sat down upon being the only Member of the Opposition who has had the courage to advocate a full-blooded alternative to the Income Tax proposals of my right hon. Friend. Even he has failed to avoid the pitfall into which nearly every one of his predecessors have

    1377
    fallen, namely, of complimenting the Chancellor of the Exchequer upon the proposed remissions of taxation which suit his own particular views, regardless of the fact that all these concessions must tend in future to an increase in the burden of the Income Tax and similar duties. We, at any rate, are free from any reproach in asking the Chancellor of the Exchequer to add to these burdens, which some of us have done to a small extent, because we recognise frankly that the Income Tax is a fair tax, and all of us on this side of the House are going to support the Chancellor of the Exchequer in carrying through the Income Tax at a rate which is erroneously called 1s. 4d. in the £, but which is a rate that is not burdensome upon incomes in the ratio in which it is applied to them. The hon. Baronet the Member for the City of London (Sir F. Banbury) raised the old and plausible point as to the heavy Income Tax making it impossible for professional men to put forth all their energies because so large a proportion would go to the State. We all recognise that that is a danger if Income Tax is carried too far, but we are very far from that point at present. It will take a great deal more than a 1s. 4d. or a 2s. 6d. Income Tax to make merchants and professional men, who are enjoying huge incomes, work less hard and take less rather than carry on the employments in which they are engaged, which very largely are carried on, not because of the enormous profits that they get out them, but because they are interested in the operation and carry it on very largely on account of that interest and for the good of the community. I believe we could raise this Income Tax considerably higher, though I hope it will not be necessary to do so, before we should reduce the energy of the business classes in earning the incomes. But while we recognise that the burdens, which are caused at present by the social reform which we have all in every part of the House supported the Chancellor in putting forward, have to be met by the richer classes, it is only fair that a large portion of the wealth which has so largely increased during the last few years should be diverted from those pockets into which an undue proportion of it has fallen to assist the working classes, who have not had their fair share. We feel, nevertheless, that the Income Tax is a distinct burden upon this class, and I would particularly ask my right hon. Friend while he is placing this impost, which, just though it is, is a heavy one, upon the commercial classes of the community,
    1378
    to see that it is administered with the most scrupulous fairness as between the nation and the tax collector and the State.
    We thank him, of course, for some of the concessions that he has made, particularly the concession to the small unearned Income Tax payer, on whom, of course, the burden falls very heavily at 1s. 2d., and on whom at 1s. 4d. it is almost unbearable, and we thank him none the less because he refused this concession to some of us last year and the year before, and gave quite conclusive reasons why it should not be granted. We are more pleased that he should have completed this, because it encourages us to press him for some of the things that he has refused during the present Debate. For instance, I very much regret that he has not seen his way to make at least some concession in regard to the joint incomes of husband and wife. It is, I believe, not only in the interests of morality, but in the interests of the race itself, that people should be encouraged to marry young and to produce their families at an early age, when they have not a large income, rather than wait till later, when they will not produce children who will be as able to carry on the burden of the race, and that is distinctly checked when two people with small incomes, both entitled to abatements, find that if they many and pool their incomes they are not entitled to relief. It is just at the time when they marry and incur extra expense that they should not be penalised by the State, but should, if possible, be helped; and while I recognise gladly the concessions that the right hon. Gentleman has made in increasing the allowance for children on small incomes, I would urge that he should also consider whether in some future years it is not possible to relieve the burden which falls upon the small joint income of husband and wife.
    Meanwhile there are certain things I would urge my right hon. Friend to do at once in order to put his house in order, and see that these taxes are imposed, certainly with justice, but also with fairness to the taxpayer. It is only too prevalent an opinion at present amongst commercial men that the Income Tax official is a public enemy, and that it is justifiable to take any steps which an honourable man would not take in his dealings in ordinary private commerce to do the Income Tax Commissioners. And if he has succeeded in getting off for less than he ought to have paid,

    1379
    he feels that he has performed a meritorious act. I am quite certain that that feeling is due largely to the fact that the Income Tax officials have in very many instances used their powers unfairly as against the taxpayer, and there is good reason for the prevalent impression that if the Income Tax officials can get the better of them they will do so, and that you are only within your rights in trying to get ahead of them, and to get back something that has been lost. I have found in my own experience more than one instance where officials have taken advantage of a mere technical omission to insist upon the payment of Income Tax at the unearned rate where a man was clearly entitled to rebate and only to pay at the earned rate, and it is only to be wondered at that after an experience like that the taxpayer takes very good care and get a little of his own back from the Government, and my right hon. Friend may be quite sure that in regard to a man's own business he is much more likely to be able to do the Government than the Government is likely to be able to do him. Therefore I would suggest that it would even be good business on the part of my right hon. Friend if he were to set himself to establish a better relationship between his officials and the taxpaying public. Another instance which comes to my mind is of the eternal grievance of wasting assets, in regard to which the Income Tax has been most unjust, and very many people who are engaged in commerce feel that they are being made to pay taxes on profits which they have not earned and which they are certainly not dividing because they feel that they have had to put them on one side to replace assets which are wearing out. And yet the Income Tax officials over and over again refuse to take those assets into account and to allow any diminution from the amount on which the tax has to be paid. I notice that the hon. Member (Mr. Snowden) is prepared to justify that, but I could give him instances where it would be very difficult indeed for even him to prove that it is fair as compared with other people and other businesses also paying Income Tax, to penalise an enterprising man who is carrying on business on a sound, financial basis.
    Then I want also to make an appeal to my right hon. Friend, not for the present year but in the future, to consider whether it is not possible to simplify this whole system of Income Tax assessment, and
    1380
    enable everyone to know where he really stands. I really do defy anybody without a very large amount of labour to find out how much he himself is liable to for Income Tax, and if it is desired to work out a scale to see what the actual income paid on each income is, it is an almost impossible labour, which I do not think anyone but my hon. Friend (Mr. Chiozza Money) and the Treasury officials have ever attempted, and they do not always agree at the conclusion of the mathematical calculation. Therefore I would suggest that my right hon. Friend should see whether in future, years he cannot abandon a system which really any stranger coming to look at it for the first time would refuse to believe to have been devised outside a lunatic asylum. It would be a perfectly simple matter to set up two scales for earned and unearned income, not necessarily the same, but I should say diverging and perhaps coming together again. It could be so arranged that the burden came to very much the same on each income, and I know no reason why, if the steps proved difficult, it should not even be carried down to decimal points of a penny in the pound, so that there should be a real graduated Income Tax and no unequal step, so that a man when he gets up from £699 to £701 is a loser, and so forth. It should be possible to design a graduated Income Tax rising perhaps by pence or even by fractions of a penny, as a man's income went up, which would be perfectly fair, and would certainly be easy to understand so that a man should know what he was owing. And it would have this advantage—that it would no longer be possible for people to say they were paying 9d. and 1s. 4d. in the £ when, as a matter of fact they are paying nothing of the kind.
    This also would, of course, make possible the suggestion thrown out by the hon. Member (Mr. Hicks Beach), with regard to which a little more might be said. It is, of course, a very unpopular thing to suggest that taxation should be graded downwards, and I should be the last man to suggest it if I had not coupled with it as an absolute condition the sweeping away of the taxes which bear heavily upon the poorest of the poor. If it were possible to sweep away the Sugar Duty and the Tea Duty I should be prepared to see a minute Income Tax placed even upon small incomes. The right hon. Gentleman has shown how to do it in the Insurance Act. I admit that it would

    1381
    not be popular, but he has been brave enough to face unpopularity when he thought it was right, and I believe the working classes, if they were relieved of these wearing taxes on tea and sugar, would be prepared to face some minute tax, and it would have the inestimable advantage that the taxpayer would then know what he was paying, and the man who voted for the expenditure would know that he was having to foot the bill when it came in. It would be a most desirable reform, in my belief. It is, of course, I admit, not very popular but I trust that my right hon. Friend will not set it on one side without giving it very careful consideration, not, of course, with a view to immediate action, but in order that it may be brought into operation in future years. With that modification I believe the Income Tax, even at the heavy rate at which it stands at present, is a most logical and scientific tax, and that it will stand. It is no use hon. Members protesting against it. It has come to stay, and will be the standby of Chancellors of the Exchequer now and in the future. That is what they will look to for their ordinary source of revenue, and the bogey raised by an hon. Member an hour ago that it was the easiest method of raising money in time of emergency and war, will cease to have any terrors for Chancellors of the Exchequer, who will recognise that the proper way to raise ordinary income is from the Income Tax, and that if necessary in time of war they may then, and not till then, come to taxes upon food.
    Mr. SANDYS: The hon. Member has made the sort of speech which we are accustomed to hear from Members on the other side. There has been a certain amount of mild criticism of the right hon. Gentleman's proposals, but all the earlier part of his speech was taken up with expressions of thanks, gratitude and admiration of the right hon. Gentleman, which I am sorry we on this side of the House do not in any degree share. The hon. Member sees no danger in the enormous extensions of the Income Tax which are before us in the present proposals, and apparently sees no danger in further extensions of the Income Tax which we have to look forward to in the future. In fact, he regards this tax from a perfectly different point of view from all the great financiers who have controlled the financial destinies of this country in the past. He regards it as absolutely an
    1382
    ordinary form of revenue, and as by no means to be regarded as a financial reserve of the country. I was very pleased to listen earlier in the Debate to the very courageous speech made by the hon. Member (Mr. A. G. Harvey). I think that speech struck a very exceptional note. The hon Member, unlike most of his colleagues, appears to have some regard for economy, and he made the demand, which I am sure the right hon. Gentleman will never accede to, that he should have some details of these various proposals which are necessary in order to put this Budget into operation, otherwise, unless he was satisfied that the expenditure would be wise. I almost gathered that he was prepared to vote against his own party.
    Mr. LLOYD GEORGE: I think the hon. Gentleman said it was a demand I would not accede to. On the contrary, I think it is a most reasonable request.
    Mr. SANDYS: I am sure that will give great satisfaction, not only to the hon. Member, but to hon. Members on this side of the House and to the country at large. I should like to make one or two remarks with regard to the right hon. Gentleman's own speech. It was an extremely interesting speech and one which was remarkably characteristic of the right hon. Gentleman's methods. I was especially struck by one very characteristic touch in it. He was evidently going to draw an eloquent and persuasive argument from my hon. and learned Friend's vote on the Old Age Pensions Bill, when it turned out that my hon. and learned Friend was not in the House at the time. That struck me as rather characteristic and rather reminiscent of some of the right hon. Gentleman's efforts on the public platform. I think some of the remarks he made on the Insurance Act were distinctly unfair. I do not think he can point to any statement made in this House or the country in which we have attacked the general principle of the Act, namely, the necessity of the working classes making some contribution to insurance. We have attacked, and we were perfectly justified in attacking, the fact that this scheme was never properly discussed in this House, and was never thought out by the right hon. Gentleman himself. We attacked the finance of the Insurance Act, because we believed—and it has turned out that our belief was absolutely justified—that the financial basis was unsound, but I am

    1383
    not aware that any member of our party has ever attacked the principle that contributions by the working classes were desirable.
    The right hon. Gentleman taunted hon. Members on this side of the House for being largely responsible for expenditure which they now object to pay. The right hon. Gentleman's Budget has been announced throughout the country as a popular Budget. I understand it is the second edition of the People's Budget, with all those advantages which the People's Budget has conferred upon the people of this country. In fact, it has been described as an election Budget. If it is true, as the right hon. Gentleman says, that it is owing to hon. Members on this side of the House, and the way they have insisted on these various financial reforms, especially with regard to the readjustment of the burdens of local and Imperial taxation, that these improvements have been brought about, I think he will find it difficult to explain to the country, as no doubt he will try, that all these reforms are due to the liberality and generosity of the Radical party. But the statement of the right hon. Gentleman that all this enormous expenditure to which the country is committed for the ensuing year is largely, or to any appreciable extent, due to demands which have come from this side of the House, is, I think, an argument which cannot be substantiated. Have we on this side of the House ever demanded that this enormous expenditure of public money should be made to find salaries for thousands of public officials all over the country, and for which a considerable portion of the money must go? [An HON. MEMBER: "How much?"] I do not know, but we all know that there are thousands of them drawing substantial salaries indeed. The exact amount does not matter. It is the principle with which I am dealing. We have never demanded that enormous sums of public money should be expended on a system of land valuation, which, so far as I can understand at the present time, appears to be more or less a failure. We have never demanded that these additional sums should have to be found from time to time in order to prop up the failing finance of the Insurance Act. That has been our principal objection to the Insurance Act—not that the working classes have to contribute, but that the finances of the scheme from the beginning were unsound.
    1384
    Under these circumstances, I do not think the right hon. Gentleman is justified in the attack he has made upon our party as being responsible for this expenditure. I think we are in every way justified in protesting on this occasion to the utmost of our ability against the enormous expenditure to which the country is committed at the present time, and of which a considerable proportion will be found out of the increased Income Tax and Super-tax. The right hon. Gentleman told us in his speech that the wealthy classes of this country must be prepared to pay insurance against revolution, but when the right hon. Gentleman himself has gone about the platforms of this country, deliberately and for political purposes, setting class against class, setting the poor against the rich, and dividing the nation against itself, it is not for him to say that we should pay insurance against revolution. If there is to be revolution, it will be one for which the right hon. Gentleman himself would be largely responsible. So far as the Income Tax and the Super-tax are concerned, there must inevitably be danger in any form of taxation which is voted by a large class of the community the incidence of which only falls upon comparatively few persons, and the very facility with which this tax is collected makes it, in my view, an extremely powerful weapon which should only be employed with the greatest moderation and discretion. It is desirable and necessary that the wealthier classes of the country should contribute largely to the upkeep of the State, but that one class should decide what another class has got to pay is in itself a rather dangerous state of affairs. The fact that people have to pay something themselves with regard to any particular tax is a wholesome and necessary check upon expenditure.
    There can be no doubt that this heavy taxation with which we are face to face at the present time must have the result of throwing people out of employment. It makes conditions harder, it makes competition more severe, and the result of that must be, if not to lower wages, at any rate to prevent wages from rising. It increases the cost of production, and consequently adds to the cost of living. If wages have a tendency, if not to go down, to remain stationary, whilst the cost of living goes up, is it not evident that in the end this tax falls upon the working classes? What is the result? The result is that the struggle for existence becomes keener and

    1385
    more severe, and that the conditions of the working classes become harder. Many unfortunate people who have not the moral or physical strength to continue the struggle fall out, and they have to fall back on the resources of the State, which means more taxation, and so the whole system moves round in a vicious circle of taxation creating further burdens of taxation, and making the position of all classes more and more difficult. I say this Income Tax system, which, I admit, is necessary for the preservation of the financial stability of the country, is a weapon which can be applied with such facility, and only concerns such a comparatively small class of the community, that there is great temptation for any Chancellor of the Exchequer to make use of it beyond the real bounds of prudence. I sincerely hope—though I do not suppose we shall get any support from the other side of the House—that the right hon. Gentleman, if he should be in charge of the finances of this country next year, will reconsider this question, and will certainly not make it part of his financial scheme to impose further burdens upon those who are already sufficiently taxed.
    Mr. TIMOTHY DAVIES: I do not know exactly how the hon. Member opposite (Mr. Sandys) would propose to raise money in a better way than has been proposed by the Chancellor of the Exchequer. The hon. Member suggested that the raising of additional revenue by increasing the Income Tax is because of the number of officials who have been brought into Government Departments during the last four or five years. It is evident that the hon. Gentleman was not in the House when that charge was answered earlier today, and when it was stated that the whole extra cost for officials appointed in the last six years would not amount to a farthing in the £ of Income Tax.
    8.0 P.M.
    At first I thought the new proposals with respect to Income Tax would weigh rather heavily upon people with limited incomes, but after taking everything into consideration, and particularly the relief which will be given by the Bills which will be brought before the House, I think that both in regard to business men in towns, and people in agricultural districts, we shall be better off when the full fruition of the proposals have been realised. I am thankful to the Chancellor of the Exchequer for the concession he is making on unearned incomes up to £300. A person who has an unearned income of £300 a

    1386
    year will pay £7, instead of £8 3s. 4d., if the concession suggested by the Chancellor of the Exchequer is carried out. The Income Tax with reference to persons having incomes up to £500 will be exactly the same as previously. I did not quite understand the argument of the hon. Gentleman with respect to the division of incomes of married people. I really do not think that this is a great grievance. It is more a matter of sentiment than a grievance. After all, most men and women who are married live together in the same house. Still, if the Chancellor of the Exchequer finds out that there is a real grievance, and that there may be hard cases here and there, I am sure he will consider the matter. I am glad, also, that the Chancellor of the Exchequer has seen fit to give a further concession to persons who have young children. Indeed, I should have liked to have seen the Chancellor ox the Exchequer go further and put an extra tax on the bachelors, and I am not quite sure whether it would not be fair for the married people who have no children to pay an even higher tax than those who have children. At any rate, I think that all the suggestions in reference to the Income Tax this year go in the right direction, and the more I consider them the more I am convinced that they will bear very slightly upon persons of limited income.
    The hon. Member for Brentford (Mr. Joynson-Hicks) in his speech at Grimsby last week told how, owing to the Budget, he had to abandon his intention to purchase a £900 motor car, and be satisfied with the repair of an old one. I was also sorry to learn that he is afraid that he will be obliged to economise on his garden. The income of the hon. Gentleman must be very large indeed if the extra taxes mean £700 or £800 more, and I have not much sympathy with gentlemen who cannot pay a little extra, and who have incomes of, say, from £20,000 to £50,000 a year. I think that there would be sufficient left for them to live, and live very well. I am glad of the concessions foreshadowed a day or two ago by the Chancellor in reference to small incomes, and when they are embodied in the Budget I think that the Budget this year will be very fair, considering that the Chancellor has got to find the money. The hon. Member for St. Pancras told us this afternoon that the Chancellor of the Exchequer has been responsible for an increase on the average of £7,500,000 a year

    1387
    since he has been in office. It is clear that of that sum £4,000,000 go to the Army and Navy, and £2,000,000 to old age pensions. That makes £6,000,000. I should like to sec the first of those items cut down, if possible, as long as we are safe from foreign invasion and that sort of thing. Then we have only got £1,500,000 left. Of that sum £750,000 at least must be attributed to the natural increase, and therefore all we have to account for is, even according to the hon. Gentleman himself, the remaining £750,000, and there is nothing to find fault with in that. On the whole we are perfectly satisfied with the Budget, and as he had to find the money we think that the Chancellor has gone the best way to get it.
    Sir J. HARMOOD-BANNER: I am perhaps in a different position from some of my fellows—in fact, I am almost bound in regard to the Income Tax to express a feeling of thanks to the Chancellor of the Exchequer because he has for the first time brought personal property into contribution towards the rates. If there is one matter particularly as to which I have been seeing him on deputations for years, it has been with the object of pressing the necessity of this contribution. While I am not at all certain that the way in which it is done out of Imperial taxes instead of out of local Income Tax, is the proper method to adopt, yet it will bring a good contribution towards the municipal rates, in so far as the Income Tax is being used for this purpose. But while I say that, I must add that in reference to the increasing of the Income Tax there are one or two points in which it is necessary to make a few remarks. In the first place, while we recognise the very able speeches made from time to time by the hon. Member for Blackburn (Mr. Snowden), it is as well to point out one great fallacy which I think always underlies his speeches, and the speeches of many hon. Members below the Gangway who represent labour, and that is that all wealth is created by labour. The House will agree with me that an enormous part of the income on which the Chancellor of the Exchequer levies his Income Tax is based upon foreign investments with which the labour of the country has nothing whatever to do. It is quite right that that foreign income should bear Imperial taxation in a proper degree while it receives the benefit of our protection throughout the world from our Imperial forces, and all the interest that we can give, and the
    1388
    prestige and the capital that we employ. But, for instance, if you take a man working in the centre of Africa or in Nigeria, who makes his fortune there out of the working of a tin mine, or a man who makes his fortune there out of the working of a gold mine in the Transvaal, or men who go into the wilds of Borneo, or all over the world, there you see where incomes are created.
    Those incomes are created without one iota of help from the labour of this country. They are created out of the capital of this country and out of the Imperial prestige, and to say when those incomes come home that they are to be subjected to a heavy tax—heavy as it is, 1s. 4d., but still bearable—but to be passed on, as the hon. Gentleman below the Gangway said, until you denude it to the extent that very little is left out of the profits of that great labour and that great danger to life and health which these men had to experience in foreign countries, is to say that you are going to tell the man who labours abroad and makes his wealth abroad, "You may make your wealth abroad, but do not bring it to this country, because there is a Labour party here who will denude you of your possession." And what I say in regard to this is to tell the Chancellor of the Exchequer that if the Income Tax is raised too high, the effect will be that those industries would be taken abroad and be carried on from abroad. Some have gone away already, yet there is a huge sum in those companies upon which the Chancellor of the Exchequer now collects Income Tax, which is paid and distributed, and which he would lose if the companies were taken away to be carried on, say, in France, or in Italy, or in any of these foreign places where this business is carried on.
    It is a most important point for us to remember what an enormous amount of our income is coming from abroad, because it is not only the income of wealth which comes from abroad, but the income which is paid not once, but twice over in this country, arising from the expenditure of that income which so comes here. What would happen without that income to the consumption even of coal, and of the luxuries which are sold in shops in Regent Street and in this great City of London? If you are going to so tax the incomes of those Britishers who go abroad and labour at the peril of life and health, and then, when they come over here, have their wealth taken from them, it would not

    1389
    be 10 per cent. of the income of this country on which Income Tax is levied that would go, but it would be 50 per cent., because the shopkeepers and manufacturers and the workers all round the country would all suffer from the fact that there was not that income coming from abroad, added to our own income, which creates expenditure on these luxuries which leads to the production of these works of art, which creates these palaces in Park Lane, and all the huge industry resulting from these things, which all bring income to this country. This Income Tax question is a very wide question indeed, and now that the tax is so heavy it is important that we should have it just. The hon. Member for Scarborough (Mr. W. Russell Rea) made a most businesslike speech. I would like to associate myself with him in the appeal to the right hon. Gentleman to see that when the tax is levied, it is levied on a fair basis. What is the position at present? I do not wish the Chancellor of the Exchequer to resign his office and become a director of a public company. But if he were a director of a public company and distributed his dividends on the basis on which he exacts Income Tax from his fellows, all I can say is that the company would go to ruin, and the Chancellor of the Exchequer as a director would find himself in the hands of the Official Receiver, and the directors and auditors would find that they would be compelled, for having paid dividends on the basis on which the Chancellor of the Exchequer has proceeded, to recoup those dividends out of their own pockets as not having been paid out of profit.
    Is it right or proper that the Income Tax should be exacted on a basis which the law declares is wrong? If, further then, the Chancellor of the Exchequer was in trade and adopting the same basis and taking Income Tax as assessed by the Income Tax Association, say his income is £6,000 a, year when he is trading, and he does not provide for ordinary depreciation, but is trading without providing for that depreciation, and on the basis of his Income Tax collection, what would be the effect on the Chancellor of the Exchequer? He would very shortly be in the insolvent Court. His capital would be gone. He would have been spending income without having provided for depreciation of capital which was lost, and he would then be coming up as a bankrupt, and on examination in the Bankruptcy Court
    1390
    he would find himself committed to prison as a fraudulent insolvent for having spent his income not on a real basis, but on a fictitious basis. That is an absolutely true statement of the case which I am sure the Chancellor of the Exchequer, if he consults his legal advisers, will find to be the real position of the traders in this country. When the Income Tax is to be assessed on this high basis, this figure, so extreme that, with Super-tax added, it means that every man has to work six weeks during the year before he can earn a penny for himself, then I do think that it ought to be a fair and just Income Tax, and I consider that the Chancellor of the Exchequer would be well-advised, for the purpose of a true collection of that revenue which he desires to pay the expenditure which is incurred, to have the basis of Income Tax so revised that it would be on a true basis upon which all good directors can distribute their dividends to their shareholders. There is one other point. I would venture also to appeal for more simplicity, because the Super-tax and the Income Tax together involve a mass of calculations which are most difficult to make, and I hope that in another year it will be quite possible to adopt a freer system.
    I think the collectors do their duty, as do the Income Tax surveyors, extremely well, looking at the instructions they receive from Somerset, House, which impose on them the necessity very often of taking most unfair advantage. The result is that by no means infrequently people escape Income Tax, and, feeling that the tax is so oppressive, they do not think that they are doing anything dishonest. I think it would be a very good thing if, instead of all these numerous methods of assessment which the Chancellor of the Exchequer creates, we had an index of all the inhabitants of this country, showing their history in such a way as to indicate what their income is and what they ought to pay. It would almost be politic to say that every man in this country ought to take out a licence, and on that licence make a declaration of his income. That would be possible, and it would be a far more simple and less oppressive form than the present, and would embrace every man in the list of those who should contribute. I know many men who are well able to pay Income Tax who do not do so because there is no such record. We do want simplicity and we do want fairness in the collection of these taxes. There is no doubt about it that this is a heavy

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    tax, and I am sorry to say that so long as the Chancellor of the Exchequer is on the other side and we are on this side we have no hope of any other taxation being created to meet expenditure except this Income Tax which is now before us. I am waiting anxiously to see whether the Income Tax taken for the relief of municipal rates is only going to be an incentive to future expenditure or a relief in regard to the past. I am rather afraid sometimes that it will be a relief for the past only, or, if not a relief for the past only, then only an incentive to future expenditure. So long as the Income Tax is heavy at least let it be fair and let it be collected so that the honest trader can feel, though he considers the tax oppressive, that he is doing his duty, and that nobody is injuring him and making an unfair distinction between him and his fellows.
    Sir WALTER ESSEX: One word in passing to refer somewhat sympathetically to the remarks of the preceding speaker, who declared his disagreement altogether with the system of levying taxes upon perishable assets. To go into a case of that kind might prove a very fertile subject of discussion, but to-day there does not seem much prospect of relief coming to the manufacturer who feels this burden to be an unjust one. One thing that has interested me in this discussion more than anything else has been the absence of the old cry of protest that year after year we have been accustomed to hear raised from the benches opposite, that the prime reason for the Income Tax was that thereby funds necessary and adequate might be raised only for purposes of national defence and, possibly, national offence, and the Civil Service. To-day, I have only heard that once or twice, and the note of protest has been almost apologetically low. I suppose we must all of us agree that we as a country have come to recognise that the functions of the Chancellor of the Exchequer are no longer embraced within those narrow limits which called him to provide only for those particular items of expenditure. We are more and more, as has been frequently remarked, looking for social amelioration in many directions as a means, or, rather, a part of the taxes which the Chancellor of the Exchequer from year to year raises. I, for one, however, could wish that the amount raised for armaments were evaded, and if I had
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    any reason for disquiet in my mind with regard to the action of the Government, which it is my privilege to support in this House, it is sometimes that I am disposed to doubt whether they have been industrious enough in seeking to spread more widely and effectively the doctrines of peace amongst the nations of Europe. One finds it, when one considers it coldly, almost beyond belief that with the march of science, the increasing powers of the people in intellectual exercises and mental analysis, we should find in all the Chancelleries of Europe an increasing straining towards a more abundant measure of armaments. I would have liked to see my own Government doing obviously more in the direction of urging this greatly to the desired end. I put side by side with that disquiet which I feel the small comfort that remains to me from what was said and done by the Leader who headed our party in this House in 1906, when he held out that splendid olive branch to our great competitors across the German Ocean. But to get back to the main theme, on which I wish to say a few words. I would say that we have departed from the old idea of civil and military service as being the chief causes of expenditure to be met by the Chancellor of the Exchequer, and we have made our first great departure, in all probability, from these narrow limits, in the Education Act of 1870. It is true that had we then had a clearer foresight as to the way money was going to be spent, we should have insisted on laying upon that outgoing stream the control of the State, or, at any rate, that the various local authorities should have full and unrestricted control over the expenditure of those sums so contributed.
    Mr. DEPUTY-SPEAKER (Mr. Whitley): We are no longer engaged in a general discussion on the Budget, and we must deal specifically with the Resolutions as they arise.
    Sir W. ESSEX: Yes, Mr. Deputy-Speaker, I will do so. In regard to the Resolution, I would say that I desire to see that revenue provided still more from the sources from which we draw it, because I feel that although we may total so many millions from one class of taxes, so many millions from another class, so much from Income Tax, Super-tax, so much from indirect taxation, and the rest of it, yet I feel that the tendency of the present Government, and the Chancellor of the Exchequer is one of its most active advocates, has been, as it were, to move

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    in a sort of circle, so that it comes back again reproductively under his power and direction. He told us he had to provide about £12,000,000 for one particular outlay, namely, that of old age pensions. I would like to say, if I may be allowed to do so, how that, in a sense, has a circular flow, and there can be no doubt—
    Mr. DEPUTY-SPEAKER: This is not the occasion for that kind of argument. The hon. Member must deal with the subject of the Resolution.
    Sir W. ESSEX: I desired to get back to the point that even in this particular benefit to what is commonly phrased the lower classes, there was that effect. I was also trying to get back to the argument of the hon. Member for Tewkesbury (Mr. Hicks Beach), namely, that the Chancellor of the Exchequer missed a source of possible income in that he had not an Income Tax which levied a penny in the pound on wages. I think that might be fairly urged as being a very very daring suggestion. I do sincerely hope, however wide the Chancellor may cast his net, seeing that he is drawing today, and rightly, so much from indirect taxation, that he will see that it is his duty to stand between the working classes of this country and any further increase in the burdens they have to bear. Your ruling shuts me out, Sir, from referring to one or two other matters as to the means by which these taxes are being spent and the necessary purposes for which they are raised, but I may be permitted again to say that I do hope we have heard the last of any proposal to place a heavier tax on those lower classes whom it is the desire of this side of the House to relieve and protect from heavy burdens.
    Mr. G. LOCKER-LAMPSON: I am very sorry that the hon. Gentleman who has just spoken was shut out from rather wider Debate, as he is always a very convincing speaker, and I should have been glad to have heard his arguments on the particular points he wanted to raise. I will try to do my best to keep very strictly to your ruling. I merely want to deal with two grievances which I think arise on the proposals of the Chancellor of the Exchequer respecting these new taxes. The anomalies and injustices which always have during recent years existed in connection with the Income Tax, have become far more serious and far more acute through the Chancellor having increased the burden of the rate, and, so far as I

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    know, we have got absolutely no guarantee that the tax will not be far heavier in the future. The particular point I wish to place before the Chancellor is as to the income which really ought to come in upon the rate, which under the present law comes under earned rates. The Act of 1907 provides that earned income means any income which is charged under Schedule B or D, and which is immediately derived from the carrying on of a business, or through the exercise by the individual of his profession, trade or vocation.
    Let me now take the case of the stockjobber. It very often occurs that the stock-jobber is obliged to hold large blocks of shares for the purpose of his business, and in calculating his profits, and the probability of his profits, before entering into that particular profession, he has to bear in mind the income that he is going to receive from such holdings in the shape of dividends, and he has to take that into account, because it is part of the profession in which he is engaged. The income from dividends is, of course, taxed before receipt, and the company or bank takes the tax at the full rate of 1s. 4d, under the right hon. Gentleman's new proposals. Being entitled to the earned rate, because, after all, it is part of his business and profession, on the ground that his income does not exceed £2,000, the jobber makes his claim to the Commissioners in the ordinary way, but, as a matter of fact, he will not be able to claim the earned rate on the portion accruing as dividend. Although it is his proper business to hold those stocks, because he is obliged to keep a certain amount of them in order to sell to the stockbroker when he makes a claim, he is unable to get the earned rate on that portion of his income, because the Crown contends that the income does not come within the scope of the Act of 1907, and that he has not really immediately derived it from carrying on his trade or profession. As regards the jobber who happens to hold Government or Colonial securities, his income again is deemed to be outside the Act of 1907, as that particular income is assessed under Schedule B, to which, as the right hon. Gentleman knows, the earned rate does not apply at all. So, therefore, the unfortunate jobber, and I only take him as one instance, since I could cite many others, is hit all round. He has to pay the full rate under the right hon. Gentleman's new proposals of 1s. 4d. on all those portions of his business income.

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    In order to make the point perfectly clear, I give the instance of the builder who builds houses for the purpose of selling them. He builds them always with the idea of selling, but he has to bear in mind that very often he will not be able to sell his houses at once, and that, pending sale, he will have to let them. It continually happens in such cases that the houses are let until the builder can get a customer for them. The builder is assessed under Schedule D, less, of course, expenses, but the income arising from the letting of the houses is assessed under Schedule A at 1s. 4d. in the £ upon each house, which the tenant pays in the first instance and then recovers from the landlord by making the necessary deductions from the rent. Thus, the builder is taxed on what is really part of his business profits at the full rate of 1s. 4d. in the £. On the other hand, the clergyman, whom I take as an instance on the opposite side, and who has rents and property taxed at the higher rate under Schedule A, can obtain repayment of the difference in the rates if the income happens to be part of the emoluments of his office. I do not see really in the least why the same principle should not apply to all others who draw their income quite directly and in close connection, and necessary connection, in carrying on their trade or profession. All incomes accruing to the trader or professional man from the actual carrying on of his trade and profession are assessed at the higher rate in the first instance, and they ought to be deemed earned income. I think it is only fair that they ought to be able to recover the difference in the rates in the cases I have mentioned, and cases of a similar nature.
    My final instance is another case which I really think the right hon. Gentleman ought to do his best to meet, and I think it is a very substantial grievance which the recipients of earned incomes have got against the right hon. Gentleman's new proposal. I do not say that it is a grievance originated by the right hon. Gentleman; he did not originate it, but it is a grievance which has become much more acute under the increased taxes which he has just placed upon the people. The right hon. Gentleman knows that in the Super-tax an allowance is made of life insurance premiums up to one-sixth of the total income. If the premium allowed reduces the total income below the Super-tax limit, then the person who
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    receives that income has no liability with regard to the Super-tax. For instance, suppose a man has an income of £3,200 a year, and pays life assurance premiums of £300 a year, that reduces his income to £2,900, and he will be entirely exempt from Super-tax. But, for the purpose of calculating his ordinary Income Tax, the amounts paid for life assurance premiums are not allowed to be deducted. For instance, supposing under the new system a man has an income of £705. and is paying life assurance premiums of £35, he will not be allowed any abatement, on the ground that his income has been reduced below the limit of £700. That, again, is not fair, especially having regard to the very high rate under the new proposals. To my mind, life assurance premiums—I think every fair-minded man will say so—ought to be allowed in calculating the statutory abatement for ordinary Income Tax, just as they are allowed when calculating for Super-tax. In fact, it is really much more reasonable, because it applies to a much more needy class than under the Super-tax proposals.
    The Chancellor of the Exchequer will probably say that it would cost a great deal of money to allow this to be done, and that he cannot afford it. If it would cost a great deal of money, it only shows that the Exchequer is making a great deal of money out of some very hard cases. There is one method by which the right hon. Gentleman could raise a considerable amount of money. I will not go into it at any length. At present he gets practically no Income Tax whatever out of foreign firms trading in this country. Suppose a foreign firm has an agent getting business for them in this country: the Exchequer gets practically no Income Tax out of that firm's profits in this country at all, and it fails to do so merely on a very technical point. If the agent of the foreign firm sends all orders to his firm for confirmation, and if delivery takes place abroad that agent is not liable to pay Income Tax on the profits. If, on the other hand, these technicalities are not observed, Income Tax has to be paid. I suggest that these technical subterfuges for evading the payment of Income Tax ought to be done away with entirely. The right hon. Gentleman ought to be able to recover Income Tax from every foreign firm making profits in this country through an agent getting orders for them. That seems to me a business proposition, and I cannot believe that hon. Members

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    opposite will object to it on account of its bearing any taint of Tariff Reform. It has nothing to do with Tariff Reform or Protection. It is merely netting the foreign firms, who escape by purely technical subterfuges from paying their proper Income Tax to the Exchequer. I was going to develop the machinery for doing it, but I will not, as the right hon. Gentleman wants to leave the House. It is perfectly easy to get hold of these people, and I hope the Chancellor of the Exchequer will consider the point.
    Mr. GEORGE TERRELL: I wish to emphasise the point just made by the hon. Member for Salisbury (Mr. G. Locker-Lampson) with regard to foreign agencies. There is not the slightest doubt that there are carried on in this country an enormous number of foreign agencies which practically entirely escape Income Tax, particularly so now, when the tax is becoming heavier and more oppressive. People feel that Income Tax is no longer a fair or just tax, but that one class is being penalised for the benefit of another, and instead of every man wishing to do his duty by his country he considers that there is a certain amount of merit in escaping it. If that is the feeling amongst our own country people, how much more may we expect to find it amongst foreigners who trade here? The difficulty is how to catch these foreign parties. As a manufacturer having some considerable knowledge of business and business ramifications, I know that it is extremely difficult. At the same time, it is hard on the manufacturers in this country that they should be oppressed with this heavy Income Tax and the system of inquisition practised by the Income Tax authorities, and at the same time know that our rivals in commerce practically escape. It is a point which I hope the Inland Revenue authorities will give consideration. Their one idea at present seems to be to oppress people. You are constantly harassed with forms. If a man has a business, and perhaps two or three residences of different kinds, he has to fill up different forms which are difficult to understand. One wants to do what is right, but when he is followed up by all the different authorities and oppressed by all these forms, it adds to the feeling of injustice to which I have referred.
    Income Tax is very unjust also in the form in which it is levied on companies. It ought to be levied on dividends, not on profits. If it were levied on dividends,
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    in the course of a period of years the revenue would get at every penny of profit that the company made. There is a tussle each year with the Inland Revenue authorities. Experts are employed by the company to try and resist, dodge, or evade the tax. A great deal of expense is incurred; books are overhauled and examined. If the tax were levied on dividends the whole thing would right itself, it would be infinitely fairer, and it would remove that feeling of oppression which everybody experiences when private concerns are being each year raked over by the tax-gatherer. A matter which seems to me to be a branch of this is the very great hardship which happens so frequently in businesses which for family reasons are turned into private companies. From the moment such a business is turned into a private company the profits, which were formerly earned profits, become unearned profits, and are taxed at the higher rate. That, surely, is a matter of injustice? The Revenue authorities ought to discriminate, and discriminate in the case of a firm where the directors are working directors, and where simply for private reasons the company has been registered as a private company. They should be returned as earned, and not as unearned profits. Another class of income, or rather of profit, which I should have thought the Chancellor of the Exchequer would have dealt with in this year's Budget, is the sort of speculative profits which we hear of being sometimes made by gentlemen who dabble in stocks and shares.
    Mr. NEVILLE: Week-end investments.
    Mr. G. TERRELL: Week-end investments! Surely that is a class of profits which should be taxed. Of course, you are told that when you make a profit through a little "flutter" on the Stock Exchange that that is an appreciation of capital, and that when you lose through an unlucky speculation that it is a loss on capital, and one class is set against the other. That might be very well in some cases. But in these days, when unearned incomes of all kinds are being taxed or the demand being made, I think all classes should be treated alike. Gentlemen who make profits by speculation in any shape or form should contribute their toll to the national revenue. I would urge that steps should be taken—and it would be time well spent if steps were taken—to simplify the collection of this taxation. I

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    never could see why there should be one class of collection for Imperial taxation and another for local taxation. To my mind, whatever form taxation takes, the collection as a whole should for all purposes be centred in one authority. Without a doubt it would simplify, and save an enormous amount of expense, if each man every year had a demand note from the Government of so much for Imperial taxation and so much for local taxation. It would make it easy. At present you are oppressing your man who gives you the income; you are harassing and worrying him. I should think it would be good business for the Exchequer to try to make the pill as sweet as possible; to try to help the man who pays the taxes; lo make his trouble as light as possible. I think a great deal could be done in this connection. I would urge on the hon. Gentleman opposite that it would be to the advantage of the Treasury and to the advantage of everyone who has to provide the taxes, if something of the sort were done.
    Sir RYLAND ADKINS: If I understand rightly the argument of the hon. Gentleman who has just sat down on the question of the collection of taxes, I think I may say that I agree with it. There is no doubt all taxes, whether they are local or Imperial, whether they are raised locally or not, require standardisation, but they, too, also require that there should be local knowledge, as well as the knowledge of those people who are immediately responsible to the Treasury, and who are sent from time to time from one locality to another. There are one or two things in regard to the Income Tax proposals that I desire to say. In the first place, I desire to thank my right hon. Friend for the concessions which he announced the other day in regard to small unearned incomes. I am quite certain that this will be greatly appreciated, for it really corresponds with the facts of life, which ought to be recognised. I desire to associate myself with what has been said earlier in the Debate to-day by my hon. Friend the Member for Northampton as to the methods by which that relief should be given, without incessant worry and trouble on the part of the individual taxpayer. We all know that the difficulty of getting back taxes improperly paid is often intolerable, and in many cases involves more trouble and expense than the actual tax paid. At
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    the same time to know that when one has paid a tax which one is bound to-pay, but which really is improperly levied, leaves just that sense of irritation which is most undesirable that any citizen should have, and certainly it is most undesirable that it should become widespread amongst any class of the community. Apart from that I support, on the whole, the proposals of the Government in regard to Income Tax.
    There is one point to which I desire to call the attention of my right hon. Friend and the attention of the House—that is the considerable steepness with which the graduation of Income Tax on earned income is applied to incomes between £1,500 and £2,000. Under the new proposals, you have no alteration of income under £1,000 per year. You have an increase of Income Tax from 9d. to 10½d. on incomes between £1,000 and £1,500, but for between £1,500 and £2,000 the increase goes from 9d. to 1s., which is really an increase, as is obvious, of something like 33 per cent. on the tax levied upon incomes of that kind. If you put aside the Super-tax, which is levied on an entirely different principle, that is a far steeper rate of graduation than is the case when you come to incomes of over £2,000 a year. I think, therefore, the Government would do well to consider whether it is essential that their scheme should have so steep a scale of graduation at this particular point, because incomes of between £1,500 and £2,000 in this country, if they are largely earned incomes, are very often the income of persons in the prime of life, who know perfectly well that their earning capacity will decrease as they get older, and who, therefore, if they are wise, know that this is the time of life to which they have to look for the necessary saving and provision for the future, other than actual life insurance. I think that the steepness of that graduation at that point is open to objections which do not apply to the taxation of larger incomes, and which does not apply to the graduation of the 1½d. additional tax of between £1,000 and £1,500. I should like to know whether, in discussing this matter on the Report stage, one is, or is not, allowed by your ruling, Mr. Whitley, to deal in any way with the way in which that money so raised is to be returned in any shape to the individuals who pay the taxes by means of any alleviation of the charges which they are paying as rates?

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    It makes a great deal of difference—I want to put my point quite respectfully—when one is prepared to vote for increased taxation in a particular form, whether one knows that that taxation is going to come back in any form into the pockets of those, or many of those, who are paying it; and, therefore, it is not altogether so easy to discuss the propriety and the fitness of an increase of Income Tax if one has to think of it as wholly detached from the effect which it will have on the taxpayers according to the way in which it is spent. I quite agree it is not in order now or probably relevant to discuss the way in which the taxes should be spent in one Imperial service as against another, but if any portion of the money so raised by the taxation we are now discussing is intended, and that it is arranged it shall come back to the taxpayers in another form, that certainly is germane to the question whether we should proceed to argue it or not, and therefore I ask whether hon. Members are to be allowed to refer—not, of course, in detail, but in the generality—to the relief of the taxpayer, who is also a ratepayer, and who might be very much more willing to submit to an increased Income Tax than if he knew it was a net loss?
    Mr. DEPUTY-SPEAKER: That is rather a long point of Order. I am sure the Rule is that, when we reach the Report stage of a Resolution on a Bill, that Resolution is taken by itself. A general discussion of the Budget will be relevant more to the Second Reading of the Bill.
    Sir RYLAND ADKINS: Then the Resolutions, being Resolutions for the imposition of a certain new rate of Income Tax, I would say that acceptance of these proposals in this House and in the country will depend, possibly considerably, on the way in which the Government can convince the House and convince the public outside that these very considerable increases are not really so great as they appear, because an appreciable part of them will be returned during the present year; and as regards the present year, on the existing basis to the taxpayers in their other capacity as ratepayers. Speaking here strictly, I hope, upon this Resolution, and speaking upon those proposals, which in any way I think are highly desirable which have this great advantage, that you are taking money from the pockets of the bulk of persons who have no income beyond a very low limit, and in some particular classes of the community these proposals,
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    having this quality of justification, will, I think, depend a great deal for their support on the questions to which I have referred as to how much really goes back in some form, in the form of relief of rates. Speaking in general support of this Resolution, and referring to what I venture to call the excessive steepness of the graduation, I reserve both for my independent judgment upon the third reading of the Resolution, and upon the Finance Bill to be founded upon them, till I for one am convinced that the general amount in this current year in which the actual burden is admitted, and that relief is of a kind in equality and distribution which is necessary to compel the support which this Resolution would have upon the community generally because of the wideness of their application, and because, apart from these details, they are an equitable form of taxation.
    9.0 P.M
    Mr. NEVILLE: The last words of the last speaker alluded to the wideness of the basis upon which these Resolutions have been founded. It seems to me that that is one of the most fatal pieces of criticism one could make against these proposals. The fact is, that the number of people who are liable to Income Tax are much too small for a really safe and sound basis of taxation. And the point that I should like to make is this: I am not quarrelling for a moment either with the application of the money or the amount of the taxes, but I should like to call attention to the sources from which the money has come. Income Tax is no doubt a tax entirely upon the thrifty, and when you come to look upon the trade and commerce of this country and see upon what it is based, you can see that the fate of this country depends, and its commerce is financed and based upon the surpluses of the thrifty. It is a fact that a certain number of people are able to live within their income, and money which is collected in this way is able to be lent out to finance big business and to help the market, and anything which is done to penalise the thrifty or makes them think they are unfairly dealt with, has an effect upon their surplus collected at the present time, and which are so useful to trade. I want to point out this fact, which seems to be self-evident. The effect of excessive taxation upon the thrifty is, that the thrifty try to do their best to avoid and evade taxation. I do not mean to say evade it improperly, but people can so arrange matters

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    and fix financial burdens that they can legitimately and with perfect propriety get out of paying taxes; that is the man who feels he is undoubtedly burdened by the incidence of this taxation will see if he cannot by splitting up his liability, or handing over his property in his own lifetime to those who come after him, try and avoid the burdens of this description. It must be quite understandstable by everybody that a number of small incomes and small surpluses are not available in the same way for the benefit of trade as large surpluses are in the hands of bankers.
    I remember thirty years ago, that doing business with the bankers with whom I banked there was a large landed proprietor who wished to keep a permanent balance of half a million available. He had enormous commitments and enormous estates, and there was no period of the year in which he would not have to put his hand in his pocket to find large and unexpected sums in order to enable his to finance as he did his large estate, and manage it to the best possible advantage. He found it necessary to keep that balance with the bank. Of course, that £500,000 was not drawn out the day after it was paid in, nor did the bankers know when it was to be drawn out. It was drawn out at an average rate, and a very large proportion of that £500,000 was available every fortnight for helping the markets and the Stock Exchange, for the markets and Stock Exchange from time to time require money to carry out the financial transactions which take place. That £500,000 kept there as a balance was being continually lent to the market, and was available for financing the commerce of the country. If you split that up into blocks of £500 each, how much would be the balance left at the bank? I believe people with families having £500 a year find it extremely difficult to have a surplus at all. Persons in cases of that kind are habitually charged interest because their accounts are overdrawn. The working classes are most thrifty in the way they save, and I do not think it would be possible for them to save more. The only class which saves largely is the middle class, and the middle class is the backbone of the country, and supplies the money to carry on the industries of the country and the finance of the business. Anything that discourages the thrift of the middle classes is dealing a mortal blow at
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    the prosperity of the country and its commerce. One can easily see the effect of dividing up one's property during his lifetime. When a man has a son who comes of age, if he is a person in whom he can put confidence, it is only right that the parent should place him in a position of independence for himself. That is entirely democratic, and it is a principle which will no doubt be carried out in a most democratic way in this country. May I, however, point out the effect of such a splitting up of property. Take, for example, the policy of the Government with regard to the Land Taxes. We have seen the effect of the Budget of 1909 in the quantity of sales of large estates which have taken place. If you take a large estate of 1,000 acres which in the hands of the late owner was subject to Super-tax, and full Income Tax, and every other tax, and split it up into estates of 50 or 100 acres, then those smaller estates would practically pay no income at all, because they are below the limit. The result of the policy of splitting up the large estates, which is due to the heavy taxation which has been imposed and which has been threatened, will be that the land of this country will practically pay no Income Tax at all. It must have the effect which I have suggested.
    The same thing will apply to personalty. If you adopt a tax which places an undue burden on the middle classes, and if you once make the middle classes feel that they are going to be treated, as the milch cow, upon which every additional expenditure is to be imposed, the effect will be that the middle classes will naturally cease to be thrifty; and, if that happens, I should like to know where the country is going to get the money to finance business. The hon. Member for Blackburn (Mr. Snowden) said he looked forward to the time when we should have a £250,000,000 Budget, and therefore this is only the beginning. If you cannot get money to finance business from the middle classes, where are you going to get it? Clearly the poor cannot save it, and I do not expect them to save it. The rich will be living up to their incomes, and the only people who do not live up to their incomes and are walling to forego the pleasure of spending every penny they make in order to provide for the future are the middle classes, and incidentally they provide the funds which the bankers lend out to traders to pay the wages which the working classes get at

    1405
    the present time. I think that point ought to be emphasised. I should also like to draw attention to the Returns which have to be filled up for the Inland Revenue. It used to be said in this country that the real advantage which Englishmen had over foreigners was that there was no imposition at all. One may say that there is no other country in the world where taxation is based upon the bed-rock honesty of the people who make the returns. No other country has ever dared to base the taxation of its people upon the well-known innate honesty of the people in the way the Government of this country can trust to the returns being made.
    All that has been altered now, and we are in the hands of inquisitors who are continually sending us their forms and multiplying them. I received myself yesterday a form with regard to the abatement which may be claimed by Members of Parliament. I cannot tell you how many questions that contains which I was to answer. I have other forms which I am now filling in, and with regard to which I cannot tell what the proper amounts are. The difficulties with regard to land are such that it is almost impossible to arrive at the proper amount, and it is impossible for anybody who is not an expert to fill them up correctly. I belong to the legal profession, and I can only say that I should be the last person to dare to make out a return with regard to the little land I possess without taking expert advice upon the point. I have received lately a form with regard to the abatement on the £400 a year which all of us are not enjoying, and it contains a multiplicity of questions from start to finish. If that was the only form an hon. Member had to fill up, or any particular taxpayer had to fill up, then it is not such a bad thing, but if that is only one of about ten, it is a totally different thing. Some of these forms may take a fortnight to find out the information and correctly answer the questions, because they are such that nobody but an expert can fill them up. At the end of the form there is the statement "that those who do not claim, an abatement may sign here." There was no statement as there ought to have been that anyone who did not claim an abatement was to sign the form without answering the other questions. I dare say there are many hon. Members who are now racking their brains as to how to fill up this form, making calculations as to children, born or unborn, and other questions. These
    1406
    points ought to be made clear, and we should not be put to the expense and trouble of making the returns and be subject to a heavy penalty if they are not correctly made. You are not sure after filling up the form that you are not rendering yourself liable to pay some penalties after doing your best to arrange that you are giving full and complete answers. There is also the question of the joint income of husband and wife. Now that we have the Married Women's Property Act, and so many ladies have asserted their independence and their financial independence—I do not say rightly or wrongly—and using their own money in their own way, it seems to me a monstrous shame that the income of a wife should be aggregated with that of her husband in order to see whether they are liable for Income Tax or Super-tax. These taxes press heavily upon the middle classes, and it is upon them that the burden falls heavily at the present time. I do not think that the middle classes at the present time have tumbled to the fact that they will be attacked in that way if the hon. Member for Blackburn has his way with the Chancellor of the Exchequer, and if the Chancellor of the Exchequer is an apt pupil of the hon. Member. When they do tumble to the fact that they are being attacked, both by Death Duties and the Income Tax because you wish to avoid the trouble of thinking, and the brain fag of finding out a broader basis of taxation, then I say they may take every means in their power to save themselves, and to spend up to the hilt, because that is what they are asked to do. They are encouraged in extravagance, and, once they realise that, you will have destroyed your best asset, namely, the thrift and self-sacrifice of the middle classes.
    Mr. TOUCHE: I sincerely hope that I shall not have to do six months' hard labour, but I confess that I did not rack my brains over the form to which my hon. Friend (Mr. Neville) has referred. When I received it, I promptly put it into the waste-paper basket. I am in entire agreement with everything my hon. Friend has said, with one exception. He said that he had no quarrel with the amount of the Income Tax. I have a considerable quarrel with the amount of the Income Tax. The amount of the tax is most objectionable on public grounds. At an earlier stage in the proceedings the hon. Member for Salford (Sir W. Byles) told us that we ought to regard the predatory attacks of the

    1407
    Chancellor of the Exchequer as a blessing in disguise. I think he said that if the Chancellor of the Exchequer rifles our pockets, it only has the effect of making us more careful of what remains. There is a certain element of truth in that, and it is on that aspect of the situation that I desire to say a few words. It is undoubtedly necessary for those whose incomes are penalised to try to make the best of the balance. The result of that is that they have to seek a very much larger return than heretofore, and that has a very far-reaching effect on the general finances of the country, and on the conditions of industry.
    We have heard a good deal about the way in which money has been sent abroad. It is a mistake to assume that money has been sent abroad chiefly with the object of escaping the payment of Income Tax at home. That, no doubt, to some extent has been the case. It has been sent abroad partly for that reason, and partly also because of the fear of new burdens, but chiefly in order that the investor may receive a larger return, which will make him the better able to bear the heavy burden of direct taxation. Everyone has been driven to seek a higher rate of interest. It is notorious that investors are no longer satisfied with the yield that satisfied them a few years ago. That is a new feature which has undoubtedly changed the financial outlook. Now this higher rate of interest necessarily means higher cost of production, and to my mind it seems that a higher rate of Income Tax, involving a demand for a higher rate of interest, necessarily means higher cost of living for all. I think that there is a very direct connection between the higher Income Tax and the increased cost of living from which our working classes are suffering in this country at the present time. It is in order to get this higher rate that investors have to seek these foreign investments.
    Mr. Lehfeldt has recently prepared some very interesting statistics showing the movement of the investment market. Last year the public issues in London was very much of the normal amount, but they were abnormal and peculiar in this respect, that they showed an extraordinary balance in favour of the number of issues of foreign securities. Of the large issues at fixed interest, by which I mean issues representing upwards of £900,000 in cash value, and excluding bonds and notes of less than seven years' currency, the total was a
    1408
    little more than £111,000,000, and of that less than £5,000,000 represented Home securities. The balance was represented by Colonial and foreign issues, and the highest proportion of all was in the foreign issues. Why was that? The reason of that was that the foreign issues yielded a much larger average rate of interest. Taking the total, the amount was something like very nearly 5½ per cent. If we take the smaller issues, the medium issues between £200,000 and £900,000, we find that the same story is told. The Home issues again were completely eclipsed by the foreign and Colonial issues. The total of these smaller issues was £36,479,000, and of these no less than £27,676,000 were represented by foreign and Colonial issues.
    Mr. DEPUTY-SPEAKER: I do not think that this is really pertinent to the Resolution we are now considering. At any rate it is too large a matter to come out of the confirmation of the Income Tax.
    Mr. TOUCHE: Of course, I accept your ruling, but I was endeavouring to point out how money was being transferred abroad as the direct result of the heavy Income Tax in this country. I do do not know whether you will permit me to say that an extended experience has shown that the higher rate received from these foreign issues is not accompanied by a corresponding risk of default. I will not however, pursue that subject further. I hope I shall be in order if I point out that this drain of money to abroad has considerably reduced the supply that is available at home for our British investments as a direct result of this heavy Income Tax; and, if this heavy Income Tax is going to be added to, as the Chancellor proposes, then we shall suffer still further in this respect in the future. Money is already dear for all Home industries in consequence of the higher rates which are demanded to meet the requirements of this constantly increasing direct taxation. One of the results of that is that the expansion of enterprise is checked, employment is restricted, wages are stationary, and living in this country is dearer. Not only does this high Income Tax drive our own money abroad, but it also has the effect of preventing foreign capital from coming here. The presence of large accumulations of foreign capital in the City of London has been of very great advantage

    1409
    to us in the past, and has done a great deal to make London the centre of monetary exchange. For a very long time it was regarded as the safest centre, and it brought many advantages to us and to the trade of the country. But we are now steadily losing ground in that respect, as, I believe, a direct result of the financial policy of increasing direct taxation in this country; and we shall lose a great deal more as a result of the present Budget. The indirect result of interference with that sensitive instrument, finance, is very far-reaching, and I am afraid it has not received the consideration it deserves from the Chancellor of the Exchequer. Just imagine, for instance, what the effect would be if some foreign Government were to give a bounty of upwards of 6 per cent. on the revenue of all investments made in that particular country. It would necessarily attract capital; and, surely, if a Government does the reverse of that, if it puts a tax of upwards of 6 per cent., as this Government is doing, on the interest of capital, it must have the effect of repelling capital. They are putting a charge of more than 6 per cent. In many cases it is a charge of upwards of 13 per cent. on capital in this country. That, I think, cannot fail to have the effect of repelling the accumulation of foreign capital in this country.
    I fear that when the Chancellor of the Exchequer is looking round for victims he does not fully consider the far-reaching effects of his policy. Like the thrush on the lawn looking for his breakfast worm, he merely considers where he can find an easy victim. He seeks one who cannot protect himself, owing to his not having control of a large number of votes, and, consequently, We have these proposals which unduly penalise directly a small portion of the community, and which indirectly, I believe, are detrimental to every citizen in the country. Only the other day I had brought to my notice the case of a large private trust. It is a trust consisting entirely of foreign money. The beneficiaries are foreigners, and much of the revenue is not distributed. The greater part of it is allowed to accumulate. Hitherto, it has been the practice for that revenue to come to London and to be invested in the London market, but now, as a direct result of this Budget, instructions have been sent by the foreigners to the effect that in future the money is not to come here but is to go to a foreign bank to be invested in a foreign country. [An HON. MEMBER: "In what country?"] I believe
    1410
    it is to go to a Swiss bank, but in what particular way it will be invested, I cannot say, as I have no control over that matter. That illustrates the way in which foreign money is being deflected from our markets, owing to what I regard as the short-sighted policy of the Chancellor of the Exchequer. It should be the policy of the Chancellor of the Exchequer to encourage capital, and a policy which discourages it is, to my mind, a very short-sighted policy. When a clumsy hand is placed on the delicate machinery of finance, it does much harm, and, in my opinion, the injury caused by this Budget is going to be very far-reaching. It is not of a kind, however, which the ordinary elector can at once understand. It will do a great deal of injury to our commerce and our wage-earners, but that is only what one would have expected from a Budget which, in my opinion, is the illegitimate offspring of class prejudice and financial ignorance.
    Mr. ELLIS DAVIES: We have been told by the hon. Member for Brentford (Mr. Joynson-Hicks) that one effect of the increase of the Income Tax will be to reduce purchasing capacity in this country, and that he, for instance, had had to consider whether or not he could invest his money in a new motor car, and had decided against so doing at present. The hon. Member who has just resumed his seat has also been criticising the effect of the increase of the Income Tax, and he suggests the effect would not be to reduce expenditure, but that it will have the effect of making him invest far more money in foreign countries. As a matter of fact, that process has been going on for years, and in the past we have comforted ourselves with the reflection that if that exportation of money was going on it took the form of goods. During the last three years no less a sum than £137,000,000 has been exported in gold, and, consequently, this country has not had the benefit of exporting goods to the value of that sum. If that be so, then I submit to the House, whether it be by way of Income Tax or of Death Duty, anything which reduces the exportation of gold from this country must ultimately help us; it will increase the amount of work in this country, and consequently wages, and steady the home markets. But this increase of Income Tax is to be enforced for two objects: first, to provide the new services of which we have heard; and, secondly, to give relief to the local ratepayers. I am rather sorry that

    1411
    a suggestion thrown out by an hon. Gentleman opposite has not been adopted, and that a part, at least, of this money is not to be obtained by the imposition of a local Income Tax. An hon. Member on this side this afternoon suggested a Land Tax as another source of revenue. But the difficulty with regard to that is that if you are going to respect existing contracts, then the occupier will of necessity have to pay. I should be glad if anyone could show that it would not operate in that way. I do not object to the proposals made here, but I do think the House ought to consider the question of the imposition of local, rather than of a general, Income Tax for meeting local expenses, because at the present moment the system by which we levy the money required for local purposes is unfair to the poorer classes—to the poor householder, for instance, who pays more than a fair proportion of his income and thus has to pay more in proportion to his income than any other class in rates. It is also unfair to tradesmen and to persons with large families.
    Mr. DEPUTY-SPEAKER: I do not think that that argument is relevant. We are now dealing with the Income Tax alone, and the hon. Member is not entitled to deal with the question of local rating.
    Mr. ELLIS DAVIES: I am only pointing it out as a reason for adopting the suggestion made this afternoon for the imposition of a local Income Tax. If you tell me, however, that it is not in order to point out the advantages of a local Income Tax as against rating, I cannot pursue the subject further. But the point I am making is this: that the imposition of a local Income Tax would be a much fairer method of obtaining money for local purposes than the present method. A local Income Tax would be based upon his ability to pay rather than upon his necessities. In the same way a professional man who makes a large income in a small office would be compelled to contribute according to his abilities, instead of as at present escaping with an exceeding small contribution to the local rates, while the tradesman and family man who must occupy large premises or houses are mulcted in heavy rates. I need not add I am not only in sympathy with, but I heartily support the proposals of the Chancellor of the Exchequer, and I only hope that the new services which are to be created will secure relief to the ratepayer.
    Sir J. D. REES: I have been asked to represent the case of a class I am supposed to represent, in regard to the allowance for children to those whose income is less than £500 a year, and I want to urge that that should be extended at least to persons having an income of £1,000. At the moment I really have in mind the retired Indian official. He probably is as poor, if he has no resources besides his pension, as any man can possibly be. Such a man will probably want to give his children the same advantages as he had before he entered the public service. He is really very hard hit by this extra 2d. on the Income Tax, and the man with £1,000 a year and four children would be far worse off, perhaps, than a man with £500 a year and two children, provided he wanted to send his children, as he might reasonably desire, to a public school and, possibly, a university. There is here a really very hard case. Although it was mentioned by one of my hon. Friends, the Chancellor of the Exchequer paid no attention to it in his reply. I ask the Financial Secretary to the Treasury to represent this hard case to his chief. I do not know what the argument against it is. I can see none. Upon the point of taxing incomes which accrue abroad and are not brought into this country, may I ask on what principle those incomes should be taxed, because ex hypothesi they do not obtain the protection of the law of this country—they owe nothing to Great Britain, its Parliament, its Army, its Navy, or anything that belongs to Great Britain. It might happen in the case of a British Colony or British Possession that if money were remitted from someone in England to someone there, it would be fair in that case that the Income Tax should be paid, because there it would have the protection of the two Governments and of the two Legislatures. But if the Chancellor of the Exchequer is going to tax incomes which accrue abroad and are never brought into this country, I do not know why they are being taxed, or what is the justice of taxing them. It might be desirable to get as many taxes as possible for the British Exchequer, but I presume some justice should govern the principle upon which they are based.
    As regards the Income Tax on companies, I would urge that it should be paid upon dividends and not upon profits. It frequently happens in regard to a company that it pays no dividend perhaps for years and is really at a loss every year on

    1413
    its balance sheet, although it may have to show a profit upon the profit and loss account. That is really not fair to the company or to the shareholders, and it is a grievance which urgently requires to be amended. As to the rest, I regard this extra 2d. on the Income Tax as part of the usual procedure of an electoral bribe, which is represented as being taken from one class that is financially separate from another class, and, for that reason, it appears to be an extremely immoral proceeding. My right hon. Friend (Mr. A. Chamberlain) suggested that as this money was to be spent to a great extent for the benefit of the poorer classes, a part of the taxes should fall upon them. So far as the poor of my own Constituency is concerned, I do not think that can be done, because they have already, owing to the compulsory contributions under the Insurance Act, been so ground down that they have no money left for the payment of any contribution of that sort, however just and proper it may be in principle. The Chancellor of the Exchequer has, in fact, created a deficit. He has then doubled it by putting into the Budget new propositions, each one of which should have come before the House separately on its own merits, and he has then proceeded to levy the whole of the doubled amount on one class of the taxpayers, a class which he believes, probably with great justice, has the lowest possible opinion of his financial capacity and of his political principles. The Income Tax is already over high. I have been asked to bring forward these particular points by retired public servants, who live upon small incomes, and who are put to the greatest straits to educate their children and to pay these taxes, which are now imposed for what is called social reform. Although the Chancellor of the Exchequer is not here, I urge the Financial Secretary to the Treasury to bring before him these cases in order that justice may be done to them.
    Mr. GRANT: I will not follow my hon. Friend on the points he has touched upon, much as I agree with him in everything he has said. One of the most interesting conclusions with regard to the whole discussion is the fact that one of the great parties in the State seem to accept the fact that the Income Tax is to be a regular tax, and in no way to be looked upon as a source of income in great emergencies. I do not question for one moment the sincerity of the Government or of the Chancellor of
    1414
    the Exchequer, especially in his underlying ideas and his financial policy. He thinks that he can benefit the many by taxing the few. It seems to be an accepted policy now that you can, with advantage to the whole community, tax a few rich people, and in that way give certain benefits to the poorer classes. In that policy the right hon. Gentleman is supported by those immediately connected with him, and he is, of course, enthusiastically supported by hon. Members on the Labour Benches, who would go a great deal further than the right hon. Gentleman has led us to understand he is at present prepared to advance. The time has come when Parliament ought to come to some conclusion as to how far we can go in that direction with advantage to the whole community. Hon. Members who sit below the Gangway opposite put no limits on the extent to which they will go. The hon. Member for Blackburn (Mr. Snowden) took the instance of a man with £10,000 a year, and said that if you took £1,000 a year from him, he would still have £9,000, and could live in luxury, and that if you took £5,000 from him he could still live in luxury. No one questions the fact, and one could go a great deal further than that, but it is hardly the point before us when we are discussing our national finance.
    It is not a question of individuals, but a question of how, by our financial policy, we can give the greatest benefit to the whole of the communtiy, and the Chancellor of the Exchequer, if he looked at the matter from a statesmanlike point of view, ought to consider how by his financial policy he can best assist the community as a whole. The hon. Member for Blackburn takes an extreme view, and believes that you can go very much further than the Chancellor of the Exchequer does, but if his idea were adopted it would certainly mean that you would do away with the man of unusual ability, who creates large industries in this country, gives a vast amount of employment, and who adds enormously to the wealth of the country, and, in that way, adds to the taxable capacity of the country in the future. I think one complaint we can make of the right hon. Gentleman's policy in regard to finance is that he never from first to last, as far as I know his policy, has done anything to encourage or to extend the taxable capacity of the country. He has rather gone in the opposite direction, and

    1415
    any man who really looks to the future ought to see that any action he takes is not depriving the country of its capacity for taxation in the future. I should not have referred to the speech of the hon. Member (Mr. Snowden) if it had not been made as a serious contribution to the Debate by a leader of thought in a certain section of the House, and I do not think the immediate followers of the Government really go as far as he does, although the Chancellor of the Exchequer has, I think, fallen a good way down the Socialist hill without very much attempt to put the brake upon him by his supporters. But I think the country has a right to know how far he is going to go. Quite apart from the harm or the good that such a policy may do, one must realises that it creates a great feeling of uncertainty in those financial and commercial centres where security is a very fundamental essential. A Socialistic policy like this gives this feeling of insecurity, which is extremely detrimental to the very best interests of the country. I think, on the whole, it would have been better if the Chancellor of the Exchequer had gone even further than he has done in imposing these new taxes, if at the same time he could have assured the country that in the future he would not go any further in that direction. That would give a feeling of security to the great commercial and financial interests of the country.
    To give a short illustration, by the financial policy of the Chancellor of the Exchequer royalties are taxed. I do not agree myself with the morality of taxing royalties. I look upon it as a most direct tax upon capital. I do not think, when one realises that the policy of hon. Members below the Gangway is to tax royalties to the extent of 20s. in the £, you can expect owners of royalties to develop their property. There is nothing more important to my mind than the great housing question. It is a question which comes before owners of royalties who wish to develop their properties. I do not think any very serious complaint should be made against the large royalty owners of not doing their duty as owners
    of property. But when you commence to tax royalties, you can go a great deal further. Hon. Members opposite are supported by Members below the Gangway, and the time may come when they will have a deciding vote in this House, and then royalty owners have this feeling of insecurity and cannot invest their money with the certainty that they will always possess this property, and it may conceivably pass from them. You do distinct damage to the general welfare of the country by taxes of this sort and not letting the country know how far you are prepared to go. It is generally slipping away, and no man knows where he will come to, and he always has that feeling of insecurity which is so detrimental, not only to himself—that is a small matter—but to those who are dependent upon him and the general welfare of the country. Take in your mind's eye a picture of a community of rich men and middle men and poor men. Undoubtedly you have a certain amount of equalling up to do. You take so much from the rich man and level up the poor man, but you cannot go as far as hon. Members below the Gangway. However, there must be some point which is good for the country. I submit that the right hon. Gentleman already has gone too far, and that in his desire to make the rich man poorer he has not made the poor man richer. He has made the poor man poorer, and, in doing so, he has lowered the financial status of this country, and, from all I have heard from hon. Members opposite, nothing has gone to disprove that. I only wish we could hear some argument from an hon. Member opposite who would tell us how this taxation is really going to benefit the community.
    Mr. EDGAR JONES: I hoped some time ago that the Committee would have come to a decision upon this Resolution. [HON. MEMBERS: "Divide!"] If hon. Members on the other side will not get up, I will sit down immediately.
    Question put, "That this House doth agree with the Committee in the said Resolution."
    The House divided: Ayes, 248; Noes, 123.

    Division No. 104.]

    AYES.

    [9.53 p.m.

    Abraham, William (Dublin, Harbour)

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

    Barran, Sir John N. (Hawick Burghs)

    Addison, Dr. Christopher

    Arnold, Sydney

    Barran, Rowland Hurst (Leeds, N.)

    Adkins, Sir W. Ryland D.

    Baker, Joseph Allen (Finsbury, E.)

    Beauchamp, Sir Edward

    Agnew, Sir George William

    Balfour, Sir Robert (Lanark)

    Beck, Arthur Cecil

    Alden, Percy

    Baring, Sir Godfrey (Barnstaple)

    Benn, W. W. (T. Hamlets, St. George)

    Allen, Arthur A. (Dumbartonshire)

    Barnes, George N.

    Bentham, George Jackson

    Black, Arthur W.

    Higham, John Sharp

    Parker, James (Halifax)

    Boland, John Plus

    Hinds, John

    Parry, Thomas H.

    Booth, Frederick Handel

    Hobhouse, Rt. Hon. Charles E. H.

    Pearce, Robert (Staffs, Leek)

    Bowerman, Charles W.

    Hodge, John

    Philipps, Col. Ivor (Southampton)

    Boyle, Daniel (Mayo, North)

    Hogge, James Myles

    Phillips, John (Longford, S.)

    Brady, Patrick Joseph

    Holmes, Daniel Turner

    Pirie, Duncan V.

    Brocklehurst, W. B.

    Holt, Richard Durning

    Pratt, J. W.

    Brunner, John F. L.

    Howard, Hon. Geoffrey

    Price, C. E. (Edinburgh, Central)

    Bryce, J. Annan

    Hughes, Spencer Leigh

    Price, Sir Robert J. (Norfolk, E.)

    Buckmaster, Sir Stanley O.

    John, Edward Thomas

    Pringle, William M. R.

    Burns, Rt. Hon. John

    Jones, Edgar (Merthyr Tydvil)

    Radford, George Heynes

    Burt, Rt. Hon. Thomas

    Jones, H. Haydn (Merioneth)

    Raffan, Peter Wilson

    Byles, Sir William Pollard

    Jones, J. Towyn (Carmarthen, East)

    Rea, Rt. Hon. Russell (South Shields)

    Carr-Gomm, H. W.

    Jones, Leif (Notts, Rushcliffe)

    Rea, Walter Russell (Scarborough)

    Cawley, Sir Frederick (Prestwich)

    Jones, William (Carnarvonshire)

    Reddy, Michael

    Cawley, Harold T. (Lancs., Heywood)

    Jones, William S. Glyn-(Stepney)

    Redmond, John E. (Waterford)

    Chancellor, Henry George

    Jowett, Frederick William

    Redmond, William (Clare, E.)

    Chapple, Dr. William Allen

    Joyce, Michael

    Redmond, William Archer (Tyrone, E.)

    Clancy, John Joseph

    Kelly, Edward

    Rendall, Athelstan

    Clough, William

    Kilbride, Denis

    Richardson, Albion (Peckham)

    Collins, Sir Stephen (Lambeth)

    King, Joseph

    Richardson, Thomas (Whitehaven)

    Condon, Thomas Joseph

    Lambert, Rt. Hon. G. (Devon, S. Molton)

    Roberts, Charles H. (Lincoln)

    Cornwall, Sir Edwin A.

    Lambert, Richard (Wilts, Crickiade)

    Roberts, George H. (Norwich)

    Cory, Sir Clifford John

    Lardner, James C. R.

    Roberts, Sir J. H. (Denbighs)

    Cotton, William Francis

    Lawson, Sir W. (Cumb'rld, Cockerm'th)

    Robertson, John M. (Tyneside)

    Cowan, W. H.

    Levy, Sir Maurice

    Robinson, Sidney

    Craig, Herbert J. (Tynemouth)

    Lewis, Rt. Hon. John Herbert

    Roch, Walter F. (Pembroke)

    Crumley, Patrick

    Lundon, Thomas

    Roche, Augustine (Louth)

    Cullinan, John

    Lynch, Arthur Alfred

    Roe, Sir Thomas

    Dalziel, Rt. Hon. Sir J. H. (Kirkcaldy)

    Macdonald, J. Ramsay (Leicester)

    Rowlands, James

    Davies, David (Montgomery Co.)

    Macdonald, J. M. (Falkirk Burghs)

    Russell, Rt. Hon. Thomas W.

    Davies, Ellis William (Eifion)

    McGhee, Richard

    Samuel, J. (Stockton-on-Tees)

    Davies, Timothy (Lincs., Louth)

    Maclean, Donald

    Scanlan, Thomas

    Davies, Sir W. Howell (Bristol, S.)

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

    Seely, Rt. Hon. Colonel J. E. B.

    Dawes, James Arthur

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

    Sheehy, David

    Delany, William

    Macpherson, James Ian

    Simon, Rt. Hon. Sir John Allsebrook

    Denman, Hon. Richard Douglas

    MacVeagh, Jeremiah

    Smith, Albert (Lancs., Clitheroe)

    Devlin, Joseph

    M'Callum, Sir John M.

    Smith, H. B. Lees (Northampton)

    Dewar, Sir J. A.

    McKenna, Rt. Hon. Reginald

    Smyth, Thomas F. (Leitrim, S.)

    Dillon, John

    M'Laren, Hon. F. W. S. (Lincs., Spalding)

    Snowden, Philip

    Donelan, Captain A.

    Marks, Sir George Croydon

    Spicer, Rt. Hon. Sir Albert

    Doris, William

    Marshall, Arthur Harold

    Sutherland, John E.

    Duffy, William J.

    Meagher, Michael

    Swann, Rt. Hon. Sir Charles E.

    Duncan, C. (Barrow-in-Furness)

    Meehan, Francis E. (Leitrim, N.)

    Taylor, John W. (Durham)

    Duncan, J. Hastings (Yorks, Otley)

    Meehan, Patrick J. (Queen's Co., Leix)

    Taylor, Theodore C. (Radcliffe)

    Edwards, Sir Francis (Radnor)

    Millar, James Duncan

    Taylor, Thomas (Bolton)

    Edwards, John Hugh (Glamorgan, Mid)

    Molloy, Michael

    Thomas, J. H.

    Elverston, Sir Harold

    Mond, Rt. Hon. Sir Alfred

    Toulmin, Sir George

    Esmonde, Dr. John (Tipperary, N.)

    Money, L. G. Chlozza

    Trevelyan, Charles Philips

    Esmonde, Sir Thomas (Wexford, N.)

    Montagu, Hon. E. S.

    Verney, Sir Harry

    Essex, Sir Richard Walter

    Mooney, John J.

    Walton, Sir Joseph

    Falconer, James

    Morgan, George Hay

    Warner, Sir Thomas Courtenay T.

    Farrell, James Patrick

    Morison, Hector

    Wason, Rt. Hon. E-(Clackmannan)

    Fenwick, Rt. Hon. Charles

    Morton, Alpheus Cleophas

    Wason, John Cathcart (Orkney)

    Ffrench, Peter

    Muldoon, John

    Watt, Henry A.

    Field, William

    Munro, Rt. Hon. Robert

    Webb, H.

    Flavin, Michael Joseph

    Murphy, Martin J.

    White, J. Dundas (Glasgow, Tradeston)

    Furness, Sir Stephen Wilson

    Murray, Captain Hon. Arthur C.

    White, Patrick (Meath, North)

    Gelder, Sir W. A

    Nannetti, Joseph P.

    Whittaker, Rt. Hon. Sir Thomas P.

    George, Rt. Hon. D. Lloyd

    Needham, Christopher T.

    Whyte, Alexander F. (Perth)

    Gill, A. H.

    Nolan, Joseph

    Wilkie, Alexander

    Gladstone, W. G. C.

    Nugent, Sir Walter Richard

    Williams, Aneurin (Durham, N. W.)

    Glanville, Harold James

    Nuttall, Harry

    Williams, John (Glamorgan)

    Goldstone, Frank

    O'Brien, Patrick (Kilkenny)

    Williams, Penry (Middlesbrough)

    Greig, Colonel J. W.

    O'Connor, John (Kildare, N.)

    Wilson, Hon. G. G. (Hull, W.)

    Griffith, Ellis Jones

    O'Connor, T. P. (Liverpool)

    Wilson, John (Durham, Mid)

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

    O'Doherty, Philip

    Wilson, Rt. Hon. J. W. (Worcs., N.)

    Gwynn, Stephen Lucius (Galway)

    O'Donnell, Thomas

    Wilson, W. T. (Westhoughton)

    Hackett, John

    O'Dowd, John

    Winfrey, Sir Richard

    Harcourt, Robert V. (Montrose)

    O'Kelly, Edward P. (Wicklow, W.)

    Wing, Thomas Edward

    Harvey, T. E. (Leeds, West)

    O'Kelly, James (Roscommon, N.)

    Wood, Rt. Hon. T. McKinnon (Glasgow)

    Haslam, Lewis (Monmouth)

    O'Malley, Wiliam

    Yeo, Alfred William

    Havelock-Allan. Sir Henry

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

    Young, William (Perthshire, East)

    Hayden, John Patrick

    O'Shaughnessy, P. J.

    Yoxall, Sir James Henry

    Hayward, Evan

    O'Shee, James John

    Hazleton, Richard

    O'Sullivan, Timothy

    TELLERS FOR THE AYES.—Mr.

    Helme, Sir Norval Watson

    Outhwaite, R. L.

    Illingworth and Mr. Gulland.

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

    Palmer, Godfrey Mark

    NOES.

    Amery, L. C. M. S.

    Baird, John Lawrence

    Barnston, Harry

    Anstruther-Gray, Major William

    Banbury, Sir Frederick George

    Barrie, H. T.

    Ashley, Wilfrid W.

    Baring, Major Hon. Guy V. (Winchester)

    Bathurst, Charles (Wilts, Wilton)

    1418

    1419

    Beach, Hon. Michael Hugh Hicks

    Hall, D. B. (Isle of Wight)

    Pollock, Ernest Murray

    Beckett, Hon. Gervase

    Hall, Frederick (Dulwich)

    Pryce-Jones, Colonel E.

    Benn, Ion Hamilton (Greenwich)

    Hamilton, C. G. C. (Ches., Altrincham)

    Randles, Sir John S.

    Bird, Alfred

    Harrison-Broadley, H. B.

    Rawson, Colonel R. H.

    Boyton, James

    Henderson, Major H. (Berks, Abingdon)

    Rees, Sir J. D.

    Bridgeman, William Clive

    Herbert, Hon. A. (Somerset, S.)

    Roberts, S. (Sheffield, Ecclesall)

    Bull, Sir William James

    Hewins, William Albert Samuel

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

    Butcher, John George

    Hill-Wood, Samuel

    Samuel, Sir Harry (Norwood)

    Campbell, Captain Duncan F. (Ayr, N.)

    Hohler, Gerald Fitzroy

    Sanders, Robert Arthur

    Campion, W. R.

    Hope, Harry (Bute)

    Sanderson, Lancelot

    Carlile, Sir Edward Hildred

    Hope, James Fitzalan (Sheffield)

    Sandys, G. J.

    Cautley, Henry Strother

    Horner, Andrew Long

    Smith, Harold (Warrington)

    Cave, George

    Hume-Williams, William Ellis

    Spear, Sir John Ward

    Chaloner, Colonel R. G. W.

    Hunt, Rowland

    Stanley, Hon. G. F. (Preston)

    Chamberlain, Rt. Hon. J. A. (Worc'r., E.)

    Hunter, Sir Charles Rodk.

    Starkey, John R.

    Clive, Captain Percy Archer

    Ingieby, Holcombe

    Swift, Rigby

    Clyde, J. Avon

    Jardine, Ernest (Somerset, East)

    Talbot, Lord Edmund

    Coates, Major Sir Edward Feetham

    Kerr-Smiley, Peter Kerr

    Terrell, G. (Wilts, N. W.)

    Cooper, Sir Richard Ashmole

    Kerry, Earl of

    Terrell, Henry (Gloucester)

    Courthope, George Loyd

    Kyffin Taylor, G.

    Touche, George Alexander

    Craig, Ernest (Cheshire, Crewe)

    Lane-Fox, G. R.

    Tryon, Captain George Clement

    Craig, Norman (Kent, Thanet)

    Larmor, Sir J.

    Walrond, Hon. Lionel

    Currie, George W.

    Lloyd, George Butler (Shrewsbury)

    Watson, Hon. W.

    Denison-Pender, J. C.

    Locker-Lampson, G. (Salisbury)

    Weigall, Captain A. G.

    Denniss, E. R. B.

    Lockwood, Rt. Hon. Lt.-Colonel A. R.

    Weston, Colonel J. W.

    Dixon, C. H.

    Lowe, Sir F. W. (Birm., Edgbaston)

    Wheler, Granville C. H.

    Duke, Henry Edward

    Lyttelton, Hon. J. C.

    Williams, Colonel R. (Dorset, W.)

    Du Pre, W. Baring

    Mackinder, H. J.

    Willoughby, Major Hon. Claud

    Eyres-Monsell, Bolton M.

    Magnus, Sir Philip

    Wilson, A. Stanley (Yorks, E. R.)

    Fell, Arthur

    Mount, William Arthur

    Wilson, Captain Leslie O. (Reading)

    Fitzroy, Hon. Edward A.

    Neville, Reginald J. N.

    Wilson, Maj. Sir M. (Bethnal Green, S. W.)

    Foster, Philip Staveley

    Newdegate, F. A.

    Wood, John (Stalybridge)

    Gibbs, George Abraham

    Nicholson, William G. (Petersfield)

    Worthington Evans, L.

    Gilmour, Captain John

    Ormsby-Gore, Hon. William

    Yate, Colonel Charles Edward

    Glazebrook Captain Philip K.

    Paget, Almeric Hugh

    Younger, Sir George

    Goldman, C. S.

    Parkes, Ebenezer

    Gordon, Hon. John Edward (Brighton)

    Peel, Lieut.-Colonel R. F.

    TELLERS FOR THE NOES.—Sir

    Grant, J. A.

    Perkins, Walter F.

    John Harmood-Banner and Mr. M.

    Gretton, John

    Pole-Carew, Sir R.

    Barlow

    Haddock, George Bahr

  WAYS AND MEANS [11th May].

    TEA.
    Resolutions reported,
    1. "That the Customs duty charged on tea until the first day of July, nineteen hundred and fourteen, shall be charged as from that date until the first day of July, nineteen hundred and fifteen, that is to say:—
    Tea, the pound … … five pence, and it is declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913."
    Resolution read a second time.
    Motion made and Question proposed, "That this House doth agree with the Committee in the said Resolution."
    Sir J. D. REES: I think anybody interested in the tea trade must have listened with rather mixed feelings to the announcement of the repetition of the duty, which is, I will not say excessive, but at a very high rate. I do not think anyone expected, under the existing circumstances of the Exchequer, that there
    1420
    would be any reduction in the Tea Duty, and seeing that it has been argued that some extra collection of taxation should, if possible, come from the poorer classes of taxpayers, I should not have expected my right hon. Friend to recommend or to vote for a reduction of the Tea Duty on this occasion. It is one of the few indirect taxes left which are levied on all classes of the community. At the same time I do not think that I should let this occasion pass without expressing my sense of the very onerous nature of the Tea Duty, and my hope that it may some day be possible to reduce it. It is impossible to avoid the reflection that, though tea is a necessity of the poor, there is nothing else except tobacco which is taxed to the same extent that tea is, which is raised in British Possessions, and by British labour and British capital; and it is not equitable that what has become an absolute necessity, and is in no sense a luxury, of the poor, should be exposed to a taxation of from 50 to 80 per cent. of its value in the case of the poorer teas. On the other hand, what most disorganises and disturbs, if it does not prove disastrous to trade, is the continual change of the duty which is levied. If a penny was taken off tea it would hardly reach the consumer,

    1421
    and would not be that benefit to the poor which one would like to see conferred by reduction of duty. If 2d. were taken off that no doubt would be an advantage to the trade and to the consumer.
    As a reduction of the amount was not to be expected this year, I cannot express any regret that a penny has not been taken off. On a former occasion a reduction of a penny was made by the right hon. Gentleman's predecessor, and I do not think that anybody thanked him. Everybody would be thankful if 2d. were taken off, if the right hon. Gentleman could see his way to do it. He cannot do so, but, at the same time, I believe that it would be possible to make a reduction which would be to the benefit of all classes if there were less socialistic legislation, so that the Chancellor of the Exchequer were not placed in the position of a man who first of all artificially creates a deficit by his own extravagance, and then comes to the House and says that it is impossible to reduce this indirect taxation which is pressing on the poor because of the present state of our finances. He will agree with me in thinking that 1d. reduction would be no use, but he would hardly agree that the whole financial position is chiefly his own making, in that he, who should be the guardian of the public purse, is the chief initiator of the legislation which makes a reduction in the Tea Duty impossible. I only rose because it is extremely difficult for anyone who is acquainted with the subject, and particularly one who has seen the production of tea in India and Ceylon, to see this very high duty repeated year after year without making some comment upon it. At the same time, I do not think that my comment should amount to a protest, because we have to consider what has to be done to meet the financial position as we find it. I do not know that it would be in order, and it would not be acceptable to the House, and I do not intend to argue the question of general policy which lands the House in this position, and I only desire to say that in the circumstances in which we find ourselves, I will not, as I have done on former occasions, move a reduction of the Tea Duty, and neither will I vote for such a reduction should it be moved by anyone else.
    Mr. HUNT: I do not see how the Liberal party can in any way justify the enormous taxation that they put on tea. The tea of the poor is taxed 75 per cent. Not only that, but the tea of the poor is paying
    1422
    proportionately a far higher tax than the tea of the rich. If a poor woman buys 3 lbs. of very cheap tea and pays 3s. for it, she pays three times as much taxation as the rich woman who pays the same amount for 1 lb. of tea, which is three times as dear. When you come to think that tea, which is a necessity of the poor, is taxed far more heavily than champagne, which is the luxury of the rich, it is still more unjustifiable. Champagne is only taxed about 15 per cent., and tea is taxed three or four times as much. If the people have got to pay this tax, as they must, because we cannot grow tea in this country, I cannot understand why the money produced by this tax cannot be raised by a tax on some of the agricultural produce which we can produce in this country. There cannot be any doubt that if you had a tariff on other agricultural produce it would encourage your own producers, and provide for your working people more wages and more work on the land, and help to get your people back on to the land which surely hon. Gentleman on the other side will agree is what we really want to do very badly here. Only about 18 per cent. of the people in this country are employed in agriculture, while about 54 per cent. are employed in factories and mines. In other countries the proportion is something like half and half, and it is only by altering your taxation from a thing like tea which you cannot produce, and putting it on to something else which you can produce, that you can really encourage and revive agriculture. The heavy taxation of tea by what is called a Free Trade Government is absolutely unjustfiable, and I beg to move a reduction of £100 in the duty on tea. I do not know whether I can or not, but if I can I beg to move a reduction of £100 in the duty on tea.
    Mr. SPEAKER: The hon. Member thinks that he is discussing the Estimates.
    Sir RICHARD COOPER: I confess I was a little distressed this evening when I discovered that there was no Amendment down to this Resolution, in accordance with the custom followed in each of the years that I have been in this House. I think it is desirable that I should make the matter clear. There is a reason why an Amendment has not been put down on this occasion, and it is that if we had put one down on this occasion we could not discuss it on the Finance Bill. I can

    1423
    promise the House that there will be an Amendment on the Tea Duty when we come to the Finance Bill. There is one point I wish to make, though not in any party spirit. We hear a great deal about the abolition of the food taxes, to which the Liberal party has been pledged, certainly since the 1906 Election. We have passed through eight years without seeing any attempt to deal with them. [An HON. MEMBER: "Sugar!"] Yes, sugar, and 2d. on cocoa. [An HON MEMBER: "And a penny on tea!"] Hon. Members below the Gangway opposite apparently forget the fact that the present Government have taken more money out of the pockets of the people of this country in food duties—[HON. MEMBERS: "No!"]—I am open to correction, but I stick to it—that they have taken more money out of the pockets of the people in food duties than was taken in 1905, before they came into office. I am afraid hon. Members below the Gangway opposite are not in the habit of reading the "Daily Citizen." When we come to the Finance Bill and the Amendment on the Tea Duty I will not fail to remind them of what recently appeared in that journal on this particular subject. I certainly do not distrust the "Daily Citizen" in what it has to say as regards the food duties and the action of the present Government since they have been in office in not fulfilling their pledges. The point I want to make, if I may, to the Chancellor of the Exchequer is this: In principle I am quite sure that every Member of this House honestly desires to see any remission of food duties, whether on tea or any other article of food, if it is going to give any relief to the people of this country who feel the burden of these taxes, and they are mostly the working clasess. By way of illustration I take the case of sugar, the duty on which, in 1908, was reduced from 4s. 2d. to 1s. 10d. Sugar has been dearer ever since. It is not a question of supply and demand at all. Ever since 1908 we have imported into this country more sugar than we ever did before.
    Mr. KING: On a point of Order. Is it allowable to discuss sugar on the Tea Duty?
    Mr. SPEAKER: It would be better if the hon. Member would confine himself to tea.
    Sir R. COOPER: Mr. Speaker, I will follow your ruling in this matter. I only
    1424
    referred to sugar by way of illustration. At the moment—perhaps I was wrong—I felt justified in doing so when we were discussing the question of the Tea Duty. When the right hon. Gentleman does come to the remission of the duty on tea, as probably within twelve months he hopes to be able to do, or on any other articles of food, I do hope that he will take all the precautions he can to make sure that if the ten millions of taxation is taken off food in this country that it does go to the people of the country generally, and particularly that the working classes, who buy tea and other articles in small quantities, will get a good share of that remission in the lightening of the burdens they now have to bear, I therefore throw out that suggestion to the Chancellor of the Exchequer, because in the illustration which I gave, it is so palpable and, indeed, incontrovertible that we do find that on the remission of duties on food stuffs it does not of necessity follow that the people are going to get the whole or any reasonable part of that benefit. I only hope that the Chancellor will carefully look at the matter before remitting so large a sum as that.
    Mr. DENNISS: I have always been an opponent of the Tea Duty, because it presses most upon the poorest of the poor. It is not only of necessity one of the very few luxuries that the poorest of the poor indulge in, but particularly of women and children. The poorest of the poor pay no direct taxation. The right hon. Gentleman the Chancellor considers that everybody in this country should contribute something to the expenses of the upkeep of the United Kingdom, but I am one of those who think that those who have barely a living wage ought not to contribute anything at all out of the small amount they have to keep body and soul together. Just think of what a poor family spends every week. They buy, probably, one pound of tea, on which the duty is five-pence, with the result that if you abolish the Tea Duty upon the lower priced tea, every poor family—and I do not speak of the working classes, because most of them are well off and, I am glad to say, independent, and can afford it, but I am speaking of the poorest of the poor, who have not got a living wage—and take off that duty, you would add to the wages of those people fivepence per week. If such a Motion as that were brought before the House, I should certainly support it. From my very earliest recollection of politics I

    1425
    have always thought that the party opposite were identified with the policy of the free breakfast table. It was not until last year, I think, that we had the Chancellor of the Exchequer, backed up by the Prime Minister, getting up and abandoning for all time the policy of a free breakfast table. When we come to the General Election, which cannot be long postponed, I think that the working classes of this country will have something to say to the Government on this question. They have many times obtained the votes of the working classes on the promise of a free breakfast table, and for years and years they have been returned in the hope that that would be consummated. I have heard the Chancellor of the Exchequer say that it was a good thing to keep up the price of tea because it would prevent poor people who stewed tea from giving that stewed tea to their children, and which was bad for them. I do not think that the
    right hon. Gentleman, who professes to have so much sympathy for the working classes, could really have thought out what that meant. They must have tea; ids one of their little luxuries; and to make it dearer in order that they may be prevented from injuring their children by stewing the tea because it is dear, seems to me an argument totally opposed to the principles which the right hon. Gentleman professes on the public platform. When we come to revise our system of taxation, I agree that the wealthy classes should pay their fair share. Most right-minded people would willingly contribute a larger amount even of Income Tax if they could thereby relieve the poorest of the poor.
    Question put, "That this House doth agree with the Committee in the said Resolution."
    The House divided: Ayes, 242; Noes, 126.

    DEATH DUTIES.
    Resolution reported,
    5. "That, in the case of persons dying after the fifteenth day of August, nineteen hundred and fourteen, there shall be substituted for the rates of the Estate Duty set out in the Second Schedule to the Finance (1909–10) Act, 1910, the following rates:—

    Where the principal Value of the Estate

    Estate Duty shall be payable at the rate per cent. of

    £

    £

    Exceeds

    100

    and does not exceed

    500

    …

    …

    …

    1

    Exceeds

    500

    and does not exceed

    1,000

    …

    …

    …

    2

    Exceeds

    1,000

    and does not exceed

    5,000

    …

    …

    …

    3

    Exceeds

    5,000

    and does not exceed

    10,000

    …

    …

    …

    4

    Exceeds

    10,000

    and does not exceed

    20,000

    …

    …

    …

    5

    Exceeds

    20,000

    and does not exceed

    40,000

    …

    …

    …

    6

    Exceeds

    40,000

    and does not exceed

    60,000

    …

    …

    …

    7

    Exceeds

    60,000

    and does not exceed

    80,000

    …

    …

    …

    8

    Exceeds

    80,000

    and does not exceed

    100,000

    …

    …

    …

    9

    Exceeds

    100,000

    and does not exceed

    150,000

    …

    …

    …

    10

    Exceeds

    150,000

    and does not exceed

    200,000

    …

    …

    …

    11

    Exceeds

    200,000

    and does not exceed

    250,000

    …

    …

    …

    12

    Exceeds

    250,000

    and does not exceed

    300,000

    …

    …

    …

    13

    Exceeds

    300,000

    and does not exceed

    350,000

    …

    …

    …

    14

    Exceeds

    350,000

    and does not exceed

    400,000

    …

    …

    …

    15

    Exceeds

    400,000

    and does not exceed

    500,000

    …

    …

    …

    16

    Exceeds

    500,000

    and does not exceed

    600,000

    …

    …

    …

    17

    Exceeds

    600,000

    and does not exceed

    800,000

    …

    …

    …

    18

    Exceeds

    800,000

    and does not exceed

    1,000,000

    …

    …

    …

    19

    Exceeds

    1,000,000

    … …

    …

    …

    …

    …

    20"

    Motion made, and Question proposed, "That this House doth agree with the Committee in the said He solution."
    Sir F. BANBURY: This is, on the whole, the worst tax which has been introduced by the Chancellor of the Exchequer in the many previous bad Budgets which he has introduced. The first effect of the tax is this: The country is living on its capital. There is no getting out of that in any kind of way. We are taking from the estate which a man has saved by years of hard work, or which he has inherited and taken great care of and endeavoured to preserve and send down to his heirs and successors as his ancestors have given it to him, what is practically, especially for the working classes of the country, the very lifeblood of the country—that is the capital, without which it is impossible to give employment to the people. We are in no way putting it by in any kind of reserve fund, or in any other way to preserve it for any kind of emergency. No hon. Member opposite has ever attempted to deny that by these antics we were living upon the capital of the country. If a man dies subject to the highest scale of duty, and his successor is not a very near blood relation, he is mulcted of 30 per cent. of his property, and in addition, during his lifetime he has had to pay an enormous sum in the way of Income Tax and Super-tax. The hon.
    1438
    Gentleman (Mr. Pretyman) a few nights ago showed us that where a man was in receipt of, comparatively speaking, a small income of £5,000 or £6,000, the result of the Death Duties, Super-tax and Income Tax combined made an Income Tax of 5s. 3d. in the £. That is an undue burden to put upon a small class of the community. I hope someone will tell with me against this most iniquitous tax, which, if it is continued, will be the ruin of the prosperity of this country, and will recoil beyond any doubt upon the working classes. Further, there is no finality whatever in these taxes. Where do hon. Members below the Gangway think they will be when once they have got the whole of the capital of this country? When it disappears, they will have to share the burden with somebody, and the result will be ruin to everybody. There is one point which I will state as briefly as possible. A large number of people have insured their lives on the understanding that the Death Duties were to be a certain amount. Now all that is gone, and they will have to reinsure their lives when they are eight or ten years older, and they will have to pay a larger amount than they had to pay before. I was looking at the Report which was alluded to by my hon. Friend the Member for Chelmsford—I think it was a Departmental Report—and I see that in the year 1906, on an estate of £150,000, the Death Duties were 6½ per cent. I am not sure

    1439
    when these duties were increased, but I think I am right in saying that they were not increased until 1909. If I am right in saying that they were increased in that year, I would like to draw attention to the fact that in these five years the Death Duties have increased from 6½ per cent. to 12 per cent. I say that is an absurd and unjust increase, and if the increase goes on, it will be most detrimental to the true, interests of the country. I will have much pleasure in dividing against this iniquitous tax—not only iniqutous, but most foolish tax.
    Sir A. WILLIAMSON: May I put one point to the Chancellor of the Exchequer with reference to the Death Duties? I dare say it has been put before when this matter has been discussed, but perhaps this year he will give it more favourable consideration, and that is the position of charities in regard to the money left to them. Hon. Members are aware that when a man leaves money to a charity that money suffers serious diminution, and the charity does not get the amount that is nominally left to it in the will. I think, if it is possible to give relief at all, the money left to charities might be considered. As one who has practical knowledge of what it means to struggling charities to have to pay a large tax to the Government, I hope the Chancellor of the Exchequer will take this matter into consideration when framing the Clause.
    Mr. CHARLES BATHURST: I wish to say a word on behalf of a class which has very little sympathy in this House, and to which I myself have the honour to belong. That is the class of country squires, who, though neither dukes nor plutocrats, have done immeasurable service to the country and the community among whom they live. You may tax personal wealth up to the hilt, but a very large proportion of it, whenever the Chancellor of the Exchequer chooses to do so, will take wings and fly away. But so far as the ordinary small country estate is concerned, and where there is no personal wealth to fall back upon, it is visible and vulnerable, and the only result of these heavy Death Duties, with the cumulative effect not only of the Death Duties but of all this other taxation which has been thrown upon so called wealth, may mean that these individuals are going to be crushed out of existence as a class in a very short period
    1440
    of time. Many men in this country with a nominal income derived purely from land may appear to have something in the region of £5,000 or £6,000 when they do not enjoy an actual income of as much as £1,000, and are living for their position in life in a state of, I will not say penury, but in a condition of no luxury whatever.
    Under the system of family settlements, which might with advantage be destroyed so far as most landed proprietors are concerned, these men have to-day to face not only these overwhelming Death Duties which take not two or three years for which the Chancellor has provided, but take a whole generation to pay where there is no personalty with which to defray them. They have to pay also the Income Tax and the Super-tax upon incomes which they never put in their pockets. They have to pay very heavy rates and tithes, in addition to charges for collateral relations under some old settlement which may be a burden on them throughout the whole of their lifetime, but which so long as that settlement exists they cannot get rid of. If the Chancellor desires to tax those individuals out of existence whom is he going to put in their place? He cannot at a moment's notice bring into existence an entirely different class of people who will occupy the mansion houses on those estates. If he does not desire to tax them out of existence the least he can do is to bring a Bill into this House to repeal the Settled Land Acts of 1882 to 1890, or to enable existing settlements to be torn up. Unless he does that what is going to happen? It is perfectly true that these individuals can sell their estates. But if they do the purchase moneys have to be handed over to the trustees of the settlement to be invested within a very narrow range—I see the Solicitor-General laughing. He would not laugh if instead of making a large income—
    The SOLICITOR-GENERAL (Mr. Buck-master): I was not laughing at anything which the hon. Member said.
    Mr. BATHURST: I am perfectly aware that the Solicitor-General is a very successful chancery counsel who has made a very large fortune out of family settlements. I appeal particularly to him who is among those who have prospered under the existing system which has proved such a source of misfortune to the unfortunate class to which I as a small country squire

    1441
    have the honour to belong. I am not speaking for myself, I am not speaking solely for the class, because I am quite sure that by pauperising this class you are affecting the prosperity of a larger number of poor people than by threatening the existence of any other class in the country. What I am going to ask the Chancellor of Exchequer is this: Those purchase moneys, if any portions of those estates are sold, are handed over to trustees of a settlement, and are brought within the range of a very narrow investment clause with the result that a very small income continues to be payable to the tenant for life.
    Your wealthy plutocrat or manufacturer can employ his money in business for the benefit of his family; but the landowner cannot do that, even when the estate is sold, because the money is tied as his property was formerly tied. He has a small income, and no control over the capital; nor is he able to employ it in the best interests of his family. The least the Chancellor of the Exchequer can do, if he is seeking, as I think he is seeking, to tax this class out of existence, is to enable them to tear up the family settlements and repeal the Settled Lands Act under which they are suffering such serious grievances. There is one further suggestion I would put to him. The housing problem is a serious problem in rural districts, and it has become in recent years a far more serious problem owing to the strain which the Death Duty charges have put upon tenants for life. If the Chancellor of the Exchequer really desires to see cottage property on these landed estates properly repaired and new cottages brought into existence, I would suggest to him as an act of wisdom to exempt the new cottages upon landed estates in the country from Death Duties for at least twenty-five years after their erection.
    Mr. LLOYD GEORGE: The hon. Gentleman has appealed to my learned Friend the Solicitor-General to answer the question about settled estates. At this late hour of the night I do not think we could afford the time for one Chancery barrister to discuss with another the question of Settlements. If he will allow me I will answer the point which he has stated.
    Mr. C. BATHURST: I would rather have it from you.
    Mr. LLOYD GEORGE: I agree with much of what was said by the hon. Member about the difficulties of settled estates,
    1442
    but the suggestion he has made is outside the purview of the Finance Bill. It is a suggestion which I should hope to see put into some sort of practical form. There is no doubt at all that landowners are crippled very largely by settlements which injuriously affect their duties as managers of their own properties. May I point out to the hon. Gentleman that, after all, the class for which he pleaded so eloquently, have received certain benefits quite as great as the plutocrat. First of all, there is the elimination of the 25 per cent. limit. He knows perfectly well that in the management of an estate where the expenditure is very heavy upon repairs, and especially upon cottage property, the abolition of the 25 per cent. limit is a very serious proposition indeed, and I should not be surprised if it made on some estates much more difference than the mere addition which I propose in the Death Duties.
    Mr. C. BATHURST: The right hon. Gentleman said the commercial plutocrat does not derive that benefit. Surely he derives that benefit under Schedule D.
    Mr. LLOYD GEORGE: He does not derive that from the present Budget. What I am pointing out is that so far as the present Budget is concerned, the advantage is given entirely to the class for which the hon. Gentleman has pleaded. As to this question, as to whether Schedule D ought to be applied to a particular class, for the moment the above concession represents an enormous advance which, so far as many of them are concerned, will more than counteract any additional expenditure they may have incurred in order to insure against the extra Death Duties. I do not grudge the good landowner an advantage of that kind; he is the kind of landowner who ought to be encouraged in the interests of the community. There is another advantage which he derives that the ordinary plutocrat does not. It is the relief in rates. The relief will be all the greater because it will be ascribed to improvements. Therefore I want the hon. Gentleman to bear in mind those two or three items on the other side of the account. If the hon. Gentleman meets me after the Budget, and if he will just point out to me an estate of that kind, I venture to say that on looking into the accounts he will find that the improvement values of a landlord such as he has described who does his duty by the estate and the tenants on the whole will profit.

    1443
    The increase in Death Duties is not considerable until you reach £200,000. That is not the landlord he was pleading for, but it is the landlord rather below the £200,000 limit that he was pleading for, and for a landlord under that amount the increase is just one per cent. I am not saying that is an inconsiderable increase, but it is nothing compared with the advantage which will be derived from those two items. It is no use trying to under-rate them. I know the hon. Gentleman has not done so, and has been perfectly fair, but I think it is right I should point that out. When he talks about housing, I should have thought that from that point of view he would certainly derive very considerable benefit from the sums of money which will be raised in order to encourage local authorities to spend money on housing. With regard to hospitals and other institutions and charities I should like to look into the matter. Mr. Gladstone, as the hon. Member knows, took a very strong view as to the exemption of hospitals from taxation. He was very much opposed to their exemption. My hon. Friend knows very well that at the present moment they enjoy very considerable immunity from taxation. Mr. Gladstone's view was that they enjoyed far too great an immunity. That was the old policy of the law, and the position in which mortmain placed those societies, and the light in which sort of charity was regarded.
    Sir GEORGE YOUNGER: I have never, and I am sure no one on this side underrates or has ever under-rated the fact that the right hon. Gentleman has endeavoured very fairly to meet the landowners in the matter of concessions for improvements they make, and so on. It is perfectly true that he is going further under this Budget than he went in the Budget of 1909, and that he has recognised a much larger claim in the future than he did. Surely that is merely redressing the very unfair position in which they were placed before in comparison with the manufacturer. He is undoubtedly redressing a great grievance if, as I hope, he is going the whole length he said he would go, and is not going to limit it. What is wanted is the assimilation of Schedule "D" to this case, and then he would really redress the grievance for which we should be grateful. My hon. Friend pointed out the greater difficulty of dealing with Death Duties
    1444
    on smaller estates than with the share capital of a business which is more easily realised and dealt with. That is the point the right hon. Gentleman did not quite take, and that is the point my hon. Friend pressed.
    Mr. RADFORD: I do not take any exception to the Estate Duty, which I think is an effective way of raising the money necessary. I should like to raise one point on the scale in the case in which a man leaves his substance to his babes, like the men of the world in the Book of Psalms, and imposes a life interest for his wife. Under the provisions of Sir William Harcourt's Finance Act of 1904, when that is done the Estate Duty becomes payable on the death of the testator, but it does not become payable again on the death of the widow. Under the scale read out in general terms, presumably the exemption from Estate Duty on the succession of the children will continue. If my right hon. Friend would give an assurance to that effect it would be gratifying to a great many Members and to the public outside.
    Sir RICHARD COOPER: I am surprised that the House, and particularly hon. Members below the Gangway opposite, should year after year pass these Estate Duties on estates from £100 to £500, or even £1,000. It is surely hardly worth while that Government officials-should be put to the trouble and expense of trying to collect one per cent. on £100. I cannot believe that there is anything remunerative in it. It is certainly not consistent with the principles of taxation followed for the last eight years by the present Government and also by their predecessors. In the case of Income Tax, you give a complete abatement on £160—
    Mr. LLOYD GEORGE: I am not making any alteration at all in those cases.
    Sir R. COOPER: I know. I am surprised that year after year estates of such very small amounts are allowed to be kept in this Resolution. In my opinion it touches only that class which we car describe as the poorest. For my part. I think that cases up to £500 and even £1,000 ought to be omitted altogether.
    Question put, "That this House doth agree with the Committee in the said Resolution."
    The House divided: Ayes, 242; Noes. 138.

    Division No. 105.]

    AYES.

    [10.20 p.m.

    Abraham, William (Dublin, Harbour)

    Dalziel, Rt. Hon. Sir J. H. (Kirkcaldy)

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

    Addison, Dr. Christopher

    Davies, David (Montgomery Co.)

    Higham, John Sharp

    Adkins, Sir W. Ryland D.

    Davies, Ellis William (Eifion)

    Hinds, John

    Agnew, Sir George William

    Davies, Timothy (Lincs., Louth)

    Hobhouse, Rt. Hon. Charles E. H.

    Ainsworth, John Stirling

    Davies, Sir W. Howell (Bristol, S.)

    Hogge, James Myles

    Allen, Arthur A. (Dumbartonshire)

    Dawes, James Arthur

    Holmes, Daniel Turner

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

    Delany, William

    Holt, Richard Durning

    Baker, Harold T. (Accrington)

    Denman, Hon. Richard Douglas

    Howard, Hon. Geoffrey

    Baker, Joseph Allen (Finsbury, E.)

    Devlin, Joseph

    Hughes, Spencer Leigh

    Balfour, Sir Robert (Lanark)

    Dewar, Sir J. A.

    John, Edward Thomas

    Banbury, Sir Frederick George

    Dickinson, Rt. Hon. Willoughby H.

    Jones, Edgar (Merthyr Tydvil)

    Baring, Sir Godfrey (Barnstaple)

    Dillon, John

    Jones, Henry Haydn (Merioneth)

    Barran, Sir John N. (Hawick Burghs)

    Donelan, Captain A.

    Jones, J. Towyn (Carmarthen, East)

    Barran, Rowland Hurst (Leeds, N.)

    Doris, William

    Jones, Leif (Notts, Rushcliffe)

    Beauchamp, Sir Edward

    Duffy, William J.

    Jones, William (Carnarvonshire)

    Beck, Arthur Cecil

    Duncan, J. Hastings (Yorks, Otley)

    Jones, William S. Glyn-(Stepney)

    Benn, W. W. (T. Hanlets, St. George)

    Edwards, Sir Francis (Radnor)

    Joyce, Michael

    Bentham, George Jackson

    Edwards, John Hugh (Glamorgan, Mid)

    Kelly, Edward

    Birrell, Rt. Hon. Augustine

    Elverston, Sir Harold

    Kenyon, Barnet

    Black, Arthur W.

    Esmonde, Dr. John (Tipperary, N.)

    Kilbride, Denis

    Boland, John Pius

    Esmonde, Sir Thomas (Wexford, N.)

    King, Joseph

    Booth, Frederick Handel

    Essex, Sir Richard Walter

    Lambert, Rt. Hon. G. (Devon, S. Molton)

    Boyle, Daniel (Mayo, North)

    Falconer, James

    Lambert, Richard (Wilts, Cricklade)

    Brady, Patrick Joseph

    Farrell, James Patrick

    Lardner, James C. R.

    Brocklehurst, William B.

    Fenwick, Rt. Hon. Charles

    Lawson, Sir W. (Cumb'rld, Cockerm'th)

    Brunner, John F. L.

    Ffrench, Peter

    Levy, Sir Maurice

    Bryce, J. Annan

    Field, William

    Lewis, Rt. Hon. John Herbert

    Buckmaster, Sir Stanley O.

    Flavin, Michael Joseph

    Lundon, Thomas

    Burns, Rt. Hon. John

    France, Gerald Ashburner

    Lynch, Arthur Alfred

    Burt, Rt. Hon. Thomas

    Furness, Sir Stephen Wilson

    Macdonald, J. M. (Falkirk Burghs)

    Byles, Sir Willam Pollard

    Gelder, Sir W. A.

    McGhee, Richard

    Carr-Gomm, H. W.

    George, Rt. Hon. D. Lloyd

    Maclean, Donald

    Cawley, Sir Frederick (Prestwich)

    Gladstone, W. G. C.

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

    Cawley, Harold T. (Lancs., Heywood)

    Glanville, Harold James

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

    Chancellor, Henry George

    Greig, Colonel James William

    Macpherson, James Ian

    Chapple, Dr. William Allen

    Griffith, Ellis Jones

    MacVeagh, Jeremiah

    Churchill, Rt. Hon. Winston S.

    Guest, Major Hon. C. H. C. (Pembroke)

    M'Callum, Sir John M.

    Clancy, John Joseph

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

    McKenna, Rt. Hon. Reginald

    Clough, William

    Gwynn, Stephen Lucius (Galway)

    M'Laren, Hon. F. W. S. (Lincs., Spalding)

    Collins, Sir Stephen (Lambeth)

    Hackett, John

    Marks, Sir George Croydon

    Condon, Thomas Joseph

    Harcourt, Robert V. (Montrose)

    Marshall, Arthur Harold

    Cornwall, Sir Edwin A.

    Harvey, T. E. (Leeds, West)

    Meagher, Michael

    Cory, Sir Clifford John

    Haslam, Lewis (Monmouth)

    Meehan, Francis E. (Leitrim, N.)

    Cotton, William Francis

    Havelock-Allan, Sir Henry

    Meehan, Patrick J. (Queen's Co., Leix)

    Cowan, W. H.

    Hayden, John Patrick

    Millar, James Duncan

    Craig, Herbert J. (Tynemouth)

    Hayward, Evan

    Molloy, Michael

    Crumley, Patrick

    Hazleton, Richard

    Mond, Rt. Hon. Sir Alfred

    Cullinan, John

    Helme, Sir Norval Watson

    Money, L. G. Chiozza

    Montagu, Hon. E. S.

    Pirie, Duncan V.

    Taylor, Thomas (Bolton)

    Mooney, John J.

    Ponsonby, Arthur A. W. H.

    Toulmin, Sir George

    Morgan, George Hay

    Pratt, J. W.

    Trevelyan, Charles Philips

    Morison, Hector

    Price, Sir Robert J. (Norfolk, E.)

    Verney, Sir Harry

    Morton, Alpheus Cieophas

    Pringle, William M. R.

    Walton, Sir Joseph

    Muldoon, John

    Radford, George Heynes

    Ward, John (Stoke-upon-Trent)

    Munro, Rt. Hon. Robert

    Raffan, Peter Wilson

    Ward, W. Dudley (Southampton)

    Murphy, Martin J.

    Rea, Rt. Hon. Russell (South Shields)

    Warner, Sir Thomas Courtenay T.

    Murray, Captain Hon. Arthur C.

    Rea, Walter Russell (Scarborough)

    Wason, Rt. Hon. E. (Clackmannan)

    Needham, Christopher T.

    Reddy, Michael

    Wason, John Cathcart (Orkney)

    Nicholson, Sir Charles N. (Doncaster)

    Redmond, John E. (Waterford)

    Watt, Henry A.

    Nolan, Joseph

    Redmond, William (Clare, E.)

    Webb, Henry

    Nugent, Sir Walter Richard

    Redmond, William Archer (Tyrone, E.)

    White, J. Dundas (Glasgow, Tradeston)

    Nuttall, Harry

    Rendail, Athelstan

    White, Patrick (Meath, North)

    O'Brien, Patrick (Kilkenny)

    Richardson, Albion (Peckham)

    Whitehouse, John Howard

    O'Connor, John (Kildare, N.)

    Roberts, Charles H. (Lincoln)

    Whittaker, Rt. Hon. Sir Thomas P.

    O'Connor, T. P. (Liverpool)

    Roberts, Sir J. H. (Denbighs)

    Whyte, Alexander F. (Perth)

    O'Doherty, Philip

    Robertson, John M. (Tyneside)

    Wiles, Thomas

    O'Donnell, Thomas

    Robinson, Sidney

    Williams, Aneurin (Durham, N. W.)

    O'Dowd, John

    Roch, Walter F. (Pembroke)

    Williams, John (Glamorgan)

    O'Kelly, Edward P. (Wicklow, W.)

    Roche, Augustine (Louth, N.)

    Williams, Penry (Middlesbrough)

    O'Kelly, James (Roscommon, N.)

    Roe, Sir Thomas

    Williamson, Sir Archibald

    O'Malley, William

    Rowlands, James

    Wilson, Hon. G. G. (Hull, W.)

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

    Russell, Rt. Hon. Thomas W.

    Wilson, John (Durham, Mid)

    O'Shaughnessy, P. J.

    Samuel, J. (Stockton-on-Tees)

    Wilson, Rt. Hon. J. W. (Worcs., N.)

    O'Shee, James John

    Seaman, Thomas

    Wing, Thomas Edward

    O'Sullivan, Timothy

    Seely, Rt. Hon. Colonel J. E. B.

    Wood, Rt. Hon. T. McKinnon (Glasgow)

    Outhwaite, R. L.

    Sheehy, David

    Yeo, Alfred William

    Palmer, Godfrey Mark

    Simon, Rt. Hon. Sir John Allsebrook

    Young, William (Perthshire, East)

    Parry, Thomas H.

    Smith, H. B. Lees (Northampton)

    Yoxall, Sir James Henry

    Pearce, Robert (Staffs, Leek)

    Smyth, Thomas F. (Leitrim, S.)

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

    Sutherland, John E.

    TELLERS FOR THE AYES.—Mr.

    Philipps, Colonel Ivor (Southampton)

    Taylor, John W. (Durham)

    Illingworth and Mr. Gulland.

    Phillips, John (Longford, S.)

    Taylor, Theodore C. (Radcliffe)

    NOES.

    Amery, L. C. M. S.

    Grant, James Augustus

    Paget, Almeric Hugh

    Anstruther-Gray, Major William

    Guinness, Hon. Rupert (Essex, S. E.)

    Pease, Herbert Pike (Darlington)

    Ashley, Wilfrid W.

    Haddock, George Bahr

    Peel, Lieut.-Colonel R. F.

    Baird, John Lawrence

    Hall, D. B. (Isle of Wight)

    Pole-Carew, Sir R.

    Banner, Sir John S. Harmood-

    Hall, Frederick (Dulwich)

    Pryce-Jones, Colonel E.

    Baring, Major Hon. Guy V. (Winchester)

    Hamilton, C. G. C. (Ches., Altrincham)

    Randies, Sir John S.

    Barlow, Montague (Salford, South)

    Hardy, Rt. Hon. Laurence

    Rawson, Colonel Richard H.

    Barnston, Harry

    Harris, Henry Percy

    Roberts, S. (Sheffield, Ecclesall)

    Barrie, H. T.

    Harrison-Broadley, H. B

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

    Bathurst, Charles (Wilts, Wilton)

    Helmsley, Viscount

    Samuel, Sir Harry (Norwood)

    Beckett, Hon. Gervase

    Henderson, Major H. (Berks, Abingdon)

    Samuel, Samuel (Wandsworth)

    Benn, Arthur Shirley (Plymouth)

    Herbert, Hon. A. (Somerset, S.)

    Sanders, Robert Arthur

    Benn, Ion Hamilton (Greenwich)

    Hewins, William Albert Samuel

    Sanderson, Lancelot

    Bird, Alfred

    Hill-Wood, Samuel

    Sandys, G. J.

    Boyton, James

    Hohler, Gerald Fitzroy

    Sharman-Crawford, Colonel R. G.

    Bridgeman, William Clive

    Hope, Harry (Bute)

    Smith, Harold (Warrington)

    Burn, Colonel C. R.

    Hope, James Fitzalan (Sheffield)

    Spear, Sir John Ward

    Butcher, John George

    Horne, E. (Surrey, Guildford)

    Stanier, Beville

    Campbell, Captain Duncan F. (Ayr, N.)

    Horner, Andrew Long

    Stanley, Hon. G. F. (Preston)

    Carlile, Sir Edward Hildred

    Hume-Williams, William Ellis

    Starkey, John Ralph

    Cassel, Felix

    Hunter, Sir Charles Rodk.

    Steel-Maitland, A. D.

    Cautley, H. S.

    Ingleby, Holcombe

    Swift, Rigby

    Cecil, Lord Hugh (Oxford University)

    Jardine, Ernest (Somerset, East)

    Talbot, Lord Edmund

    Chaloner, Colonel R. G. W.

    Kerr-Smiley, Peter Kerr

    Terrell, George (Wilts, N. W.)

    Clive, Captain Percy Archer

    Kerry, Earl of

    Terrell, Henry (Gloucester)

    Clyde, James Avon

    Kinloch-Cooke. Sir Clement

    Touche, George Alexander

    Coates, Major Sir Edward Feetham

    Kyffin-Taylor, G.

    Tryon, Captain George Clement

    Courthope, George Loyd

    Lane-Fox, G. R.

    Walrond, Hon. Lionel

    Craig, Norman (Kent, Thanet)

    Larmor, Sir J.

    Watson, Hon. W.

    Crichton-Stuart, Lord Ninian

    Lewisham, Viscount

    Weigall, Captain A. G.

    Currie, George W.

    Lloyd, George Butler (Shrewsbury)

    Wheler, Granville C. H.

    Dairymple, Viscount

    Locker-Lampson, G. (Salisbury)

    Willoughby, Major Hon. Claud

    Denison-Pender, J. C.

    Lockwood, Rt. Hon. Lt.-Colonel A. R.

    Wills, Sir Gilbert

    Dixon, C. H.

    Lyttelton, Hon. J. C.

    Wilson, A. Stanley (Yorks, E. R.)

    Duke, Henry Edward

    Mackinder, Halford J.

    Wilson, W. T. (Westhoughton)

    Du Pre, W. Baring

    Mason, James F. (Windsor)

    Wilson, Captain Leslie O. (Reading)

    Eyres-Monsell, Bolton M.

    Meysey-Thompson, E. C.

    Wilson, Maj. Sir M. (Bethnal Green, S W.)

    Fell, Arthur

    Mills, Hon. Charles Thomas

    Wood, John (Stalybridge)

    Fitzroy, Hon. E. A.

    Neville, Reginald J. N.

    Worthington Evans, L.

    Foster, Philip Staveley

    Newman, John R. P.

    Yate, Colonel C. E.

    Gilmour, Captain John

    Nicholson, William G. (Petersfield)

    Glazebrook Captain Philip K.

    O'Neill, Hon. A. E. B. (Antrim, Mid)

    TELLERS FOR THE NOES.—Mr.

    Goldman, C. S.

    Ormsby-Gore, Hon. William

    Rowland Hunt and Mr.

    Gordon, Hon. John Edward (Brighton)

    Question put, and agreed to.

    Division No. 106.]

    AYES.

    [11.28 p.m.

    Abraham, William (Dublin, Harbour)

    Gwynn, Stephen Lucius (Galway)

    O'Shee, James John

    Addison, Dr. Christopher

    Hackett, John

    O'Sullivan, Timothy

    Adkins, Sir W. Ryland D.

    Harcourt, Rt. Hon. Lewis (Rossendale)

    Outhwaite, R. L.

    Agar-Robartes, Hon. T. C. R.

    Harcourt, Robert V. (Montrose)

    Palmer, Godfrey Mark

    Allen, Arthur A. (Dumbartonshire)

    Harvey, T. E. (Leeds, West)

    Parker, James (Halifax)

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

    Haslam, Lewis (Monmouth)

    Parry, Thomas H.

    Arnold, Sydney

    Hayden, John Patrick

    Pearce, Robert (Staffs, Leek)

    Baker, Joseph Allen (Finsbury, E.)

    Hayward, Evan

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

    Baring, Sir Godfrey (Barnstaple)

    Hazleton, Richard

    Philipps, Colonel Ivor (Southampton)

    Barnes, George N.

    Helme, Sir Norval Watson

    Phillips, John (Longford, S.)

    Barran, Sir John N. (Hawick Burghs)

    Henry, Sir Charles

    Pirie, Duncan V.

    Barran, Rowland Hurst (Leeds, N.)

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

    Ponsonby, Arthur A. W. H.

    Beck, Arthur Cecil

    Higham, John Sharp

    Pratt, J. W.

    Benn, W. W. (T. Hamlets, St. George)

    Hinds, John

    Price, C. E. (Edinburgh, Central)

    Bentham, George Jackson

    Hobhouse, Rt. Hon. Charles E. H.

    Price, Sir Robert J. (Norfolk, E.)

    Birrell, Rt. Hon. Augustine

    Hodge, John

    Primrose, Hon. Neil James

    Black, Arthur W.

    Hogge, James Myles

    Pringle, William M. R.

    Boland, John Plus

    Holt, Richard Durning

    Radford, George Heynes

    Booth, Frederick Handel

    Hughes, Spencer Leigh

    Rattan, Peter Wilson

    Bowerman, Charles W.

    Illingworth, Percy H.

    Rea, Rt. Hon. Russell (South Shields)

    Boyle, Daniel (Mayo, North)

    John, Edward Thomas

    Rea, Walter Russell (Scarborough)

    Brady, Patrick Joseph

    Jones, Edgar (Merthyr Tydvil)

    Reddy, Michael

    Brockiehurst, W. B.

    Jones, H. Haydn (Merioneth)

    Redmond, John E. (Waterford)

    Brunner, John F. L.

    Jones, J. Towyn (Carmarthen, East)

    Redmond, William (Clare, E.)

    Bryce, J. Annan

    Jones, Leif (Notts, Rushcliffe)

    Redmond, William Archer (Tyrone, E.)

    Buckmaster, Sir Stanley O.

    Jones, William S. Glyn-(Stepney)

    Rendall, Athelstan

    Burt, Rt. Hon. Thomas

    Jowett, Frederick William

    Richardson, Albion (Peckham)

    Byles, Sir William Pollard

    Joyce, Michael

    Richardson, Thomas (Whitehaven)

    Carr-Gomm, H. W.

    Kelly, Edward

    Roberts, Charles H. (Lincoln)

    Cawley, Sir Frederick (Prestwich)

    Kenyon, Barnet

    Roberts, George H. (Norwich)

    Cawley, Harold T. (Lancs., Heywood)

    Kilbride, Denis

    Roberts, Sir H. (Denbighs)

    Chancellor, Henry George

    King, Joseph

    Robertson, John M. (Tyneside)

    Chapple, Dr. William Allen

    Lambert, Rt. Hon. G. (Devon, S. Molton)

    Robinson, Sidney

    Clancy, John Joseph

    Lambert, Richard (Wilts, Cricklade)

    Roch, Walter F. (Pembroke)

    Clough, William

    Lardner, James C. R.

    Roche, Augustine (Louth)

    Collins, Sir Stephen (Lambeth)

    Lawson, Sir W. (Cumb'rld, Cockerm'th)

    Roe, Sir Thomas

    Condon, Thomas Joseph

    Levy, Sir Maurice

    Rowlands, James

    Cornwall, Sir Edwin A.

    Lewis, Rt. Hon. John Herbert

    Russell, Rt. Hon. Thomas W.

    Cory, Sir Clifford John

    Lundon, Thomas

    Samuel, J. (Stockton-on-Tees)

    Cotton, William Francis

    Lynch, Arthur Alfred

    Scanlan, Thomas

    Craig, Herbert J. (Tynemouth)

    Macdonald, J. Ramsay (Leicester)

    Seely, Rt. Hon. Colonel J. E. B.

    Crumley, Patrick

    Macdonald, J. M. (Falkirk Burghs)

    Sheehy, David

    Cullinan, John

    Maclean, Donald

    Simon, Rt. Hon. Sir John Allsebrook

    Dalziel, Rt. Hon. Sir J. H. (Kirkcaldy)

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

    Smith, Albert (Lancs., Clitheroe)

    Davies, David (Montgomery Co.)

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

    Smith, H. B. Lees (Northampton)

    Davies, Ellis William (Eifion)

    Macpherson, James Ian

    Smyth, Thomas F. (Leitrim, S.)

    Davies, Timothy (Lincs., Louth)

    MacVeagh, Jeremiah

    Snowden, Philip

    Davies, Sir W. Howell (Bristol, S.)

    M'Callum, Sir John M.

    Sutherland, John E.

    Dawes, James Arthur

    M'Ghee, Richard

    Taylor, John W. (Durham)

    Delany, William

    McKenna, Rt. Hon. Reginald

    Taylor, Theodore C. (Radcliffe)

    Denman, Hon. Richard Douglas

    M'Laren, Hon. F. W. S. (Lincs., Spalding)

    Taylor, Thomas (Bolton)

    Devlin, Joseph

    Marshall, Arthur Harold

    Tennant, Harold John

    Dickinson, Rt. Hon. Wilioughby H.

    Meagher, Michael

    Toulmin, Sir George

    Dillon, John

    Meehan, Francis E. (Leitrim, N.)

    Trevelyan, Charles Philips

    Donelan, Captain A.

    Meehan, Patrick J. (Queen's Co., Leix)

    Verney, Sir Harry

    Doris, William

    Millar, James Duncan

    Walton, Sir Joseph

    Duffy, William J.

    Molloy, Michael

    Ward, John (Stoke-upon-Trent)

    Duncan, C. (Barrow-in-Furness)

    Mond, Rt. Hon. Sir Alfred

    Warner, Sir Thomas Courtenay T.

    Duncan, J. Hastings (Yorks, Otley)

    Money, L. G. Chiozza

    Wason, John Cathcart (Orkney)

    Edwards, Sir Francis (Radnor)

    Montagu, Hon. E. S.

    Watt, Henry A.

    Edwards, John Hugh (Glamorgan, Mid)

    Mooney, John J.

    Webb, H.

    Elverston, Sir Harold

    Morgan, George Hay

    White, J. Dundas (Glasgow, Tradeston)

    Esmonde, Dr. John (Tipperary, N.)

    Morison, Hector

    White, Patrick (Meath, North)

    Esmonde, Sir Thomas (Wexford, N.)

    Muldoon, John

    Whyte, Alexander F. (Perth)

    Essex, Sir Richard Walter

    Munro, Rt. Hon. Robert

    Wiles, Thomas

    Falconer, James

    Murphy, Martin J.

    Wilkie, Alexander

    Farrell, James Patrick

    Murray, Captain, Hon. Arthur C.

    Williams, Aneurin (Durham, N. W.)

    Fenwick, Rt. Hon. Charles

    Nicholson, Sir Charles N. (Doncaster)

    Williams, John (Glamorgan)

    Ffrench, Peter

    Nolan, Joseph

    Williams, Penry (Middlesbrough)

    Field, William

    Nugent, Sir Walter Richard

    Williamson, Sir Archibald

    Flavin, Michael Joseph

    Nuttall, Harry

    Wilson, Hon. G. G. (Hull, W.)

    Gelder, Sir W. A.

    O'Brien, Patrick (Kilkenny)

    Wilson, John (Durham, Mid)

    George, Rt. Hon. D. Lloyd

    O'Connor, John (Kildare, N.)

    Wilson, Rt. Hon. J. W. (Worcs., N.)

    Gill, A. H.

    O'Connor, T. P. (Liverpool)

    Wilson, W. T. (Westhoughton)

    Gladstone, W. G. C.

    O'Doherty, Philip

    Wing, Thomas Edward

    Glanville, Harold James

    O'Donnell, Thomas

    Wood, Rt. Hon. T. McKinnon (Glasgow)

    Goldstone, Frank

    O'Dowd, John

    Yeo, Alfred William

    Greig, Colonel James William

    O'Kelly, Edward P. (Wicklow, W.)

    Young, William (Perthshire, East)

    Griffith, Ellis Jones

    O'Kelly, James (Roscommon, N.)

    Guest, Major Hon. C. H. C. (Pembroke)

    O'Malley, William

    TELLERS FOR THE AYES.—Mr.

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

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

    Wm. Jones and Mr. Geoffrey Howard.

    Gulland, John William

    O'Shaughnessy, P. J.

    1446

    1447

    NOES.

    Amery, L. C. M. S.

    Gretton, John

    Paget, Almeric Hugh

    Anson, Rt. Hon. Sir William R.

    Guinness, Hon. W. E. (Bury S. Edmunds)

    Parkes, Ebenezer

    Anstruther-Gray, Major William

    Haddock, George Bahr

    Pease, Herbert Pike (Darlington)

    Ashley, Wilfrid W.

    Hall, D. B. (Isle of Wight)

    Peel, Lieut.-Colonel R. F.

    Baird, John Lawrence

    Hall, Frederick (Dulwich)

    Perkins, Walter Frank

    Baker, Sir Randolf L. (Dorset, N.)

    Hamilton, C. G. C. (Ches., Altrincham)

    Pole-Carew, Sir R.

    Barlow, Montague (Salford, South)

    Hardy, Rt. Hon. Laurence

    Pollock, Ernest Murray

    Barnston, Harry

    Harris, Henry Percy

    Pryce-Jones, Colonel E.

    Barrie, H. T.

    Harrison-Broadley, H. B.

    Randies, Sir John S.

    Bathurst, Charles (Wilts, Wilton)

    Helmsley, Viscount

    Rawson, Colonel Richard H.

    Beach, Hon. Michael Hugh Hicks

    Henderson, Major H. (Berks, Abingdon)

    Rees, Sir J. D.

    Beckett, Hon. Gervase

    Herbert, Hon. A. (Somerset, S.)

    Roberts, S. (Sheffield, Ecclesall)

    Benn, Arthur Shirley (Plymouth)

    Hill-Wood, Samuel

    Ronaldshay, Earl of

    Benn, Ion Hamilton (Greenwich)

    Hohler, Gerald Fitzroy

    Salter, Arthur Claveil

    Bird, Alfred

    Hope, James Fitzalam (Sheffield)

    Samuel, Samuel (Wandsworth)

    Boyton, James

    Hope, Major J. A. (Midlothian)

    Sanders, Robert Arthur

    Bridgeman, William Clive

    Home, Edgar (Surrey, Guildford)

    Sandys, G. J.

    Burn, Colonel C. R.

    Horner, Andrew Long

    Sassoon, Sir Philip

    Campion, W. R.

    Home-Williams, William Ellis

    Scott, Sir S. (Marylebone, W.)

    Carlile, Sir Edward Hildred

    Hunt, Rowland

    Sharman-Crawford, Colonel R. G.

    Cassel, Felix

    Hunter, Sir Charles Rodk.

    Smith Harold (Warrington)

    Castlereagh, Viscount

    Jardine, Ernest (Somerset, East)

    Spear, Sir John Ward

    Cautley, Henry Strother

    Jessel, Captain H. M.

    Stanier, Beville

    Chaloner, Colonel R. G. W.

    Kerr-Smiley, Peter Kerr

    Stanley, Hon. G. F. (Preston)

    Clay, Captain H. H. Spender

    Kerry, Earl of

    Starkey, John Ralph

    Clive, Captain Percy Archer

    Kinloch-Cooke, Sir Clement

    Talbot, Lord Edmund

    Clyde, James Avon

    Kyffin-Taylor, G.

    Terrell, George (Wilts, N. W.)

    Coates, Major Sir Edward Feetham

    Lane-Fox. G. R.

    Thynne, Lord Alexander

    Cooper, Sir Richard Ashmole

    Larmor, Sir J.

    Touche, George Alexander

    Courthope, George Loyd

    Lawson, Hon. H. (T. H'mts., Mile End)

    Tryon, Captain George Clement

    Craig, Ernest (Cheshire, Crewe)

    Lewisham, Viscount

    Valentia, Viscount

    Craig, Norman (Kent, Thanet)

    Lloyd, George Ambrose (Stafford, W.)

    Watson, Hon. W.

    Crichton-Stuart, Lord Ninian

    Lloyd, George Butler (Shrewsbury)

    Wheler, Granville C. H.

    Currie, George W.

    Locker-Lampson, G. (Salisbury)

    White, Major G. D. (Lancs., Southport)

    Dairymple, Viscount

    Locker-Lampson, O. (Ramsey)

    Willoughby, Major Hon. Claud

    Denison-Pender, J. C.

    Lockwood, Rt. Hon. Lt.-Colonel A. R.

    Wills, Sir Gilbert

    Dixon, Charles Harvey

    Lyttelton, Hon. J. C. (Droitwich)

    Wilson, A. Stanley (Yorks, E. R.)

    Duke, Henry Edward

    Mackinder, H. J.

    Wilson, Captain Leslie O. (Reading)

    Duncannon, Viscount

    Mason, James F. (Windsor)

    Wilson, Maj. Sir M. (Bethnal Green. S. W.)

    Eyres-Monsell, Bolton M.

    Morrison-Bell, Major A. C. (Honiton)

    Wood, John (Stalybridge)

    Fell, Arthur

    Mount, William Arthur

    Worthington Evans, L.

    Fitzroy, Hon. Edward A.

    Neville, Reginald J. N.

    Yate, Colonel C. E.

    Foster, Philip Staveley

    Newdegate, F. A.

    Younger, Sir George

    Gibbs, G. A.

    Newman, John R. P.

    Gilmour, Captain John

    Nicholson, William G. (Petersfield)

    TELLERS FOR THE NOES.—Sir

    Glazebrook Captain Philip K.

    O'Neill, Hon. A. E. B. (Antrim, Mid)

    Frederick Banbury and Mr. George

    Goldman, C. S.

    Ormsby-Gore, Hon. William

    Faber.

    Greene, Walter Raymond

    SUPER-TAX.
    2. Resolution reported,
    "That—
    (a) The additional duty of Income Tax (called Super-tax) shall be charged, in respect of incomes which exceed £3,000, as follows:—

    In respect of the first £2,500 of the income

    nil

    In respect of the excess over £2,500—

    for every pound of the first £500 of the excess

    five pence

    for every pound of the next £1,000 of the excess

    seven pence

    for every pound of the next £1,000 of the excess

    nine pence

    for every pound of the next £1,000 of the excess

    eleven pence

    for every pound of the next £1,000 of the excess

    one shilling and a penny

    for every pound of the next £1,000 of the excess

    one shilling and three pence

    for the remainder of the excess

    one shilling and four pence;

    and
    (b) the like provisions shall have effect with respect to the Super-tax as so charged as had effect with respect to the Super-tax charged for the year beginning the sixth day of April, nineteen hundred and thirteen; and
    (c) it is declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913."
    Resolution read a second time.
    The FINANCIAL SECRETARY to the TREASURY (Mr. Montagu): I beg to move, in Sub-section (a) after the word "for" ["for the remainder of the excess: one shilling and four pence"], to insert the words "every pound of."
    With your permission, Mr. Speaker, and the permission of the House, I beg to move this Amendment. It does not in the least alter the effect of the Resolution, but clears up an ambiguity which I was astonished to see had arisen in the minds of one or two people. By referring to the last line of Section (a) in the Resolution, it reads: "For the remainder of the
    1430
    excess." No one can have thought for one moment that the whole of the excess was to be covered by the payment of 1s. 4d., and, in order that there may be no ambiguity, I beg to move this Amendment.
    Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
    Mr. WORTHINGTON EVANS: I want to ask the Chancellor of the Exchequer whether, in order to let the public know what the effect really is, he would alter the form of his Resolution so as to make the tax payable on the net amount income actually received. I would remind the Chancellor of the Exchequer that the Super-tax falls, not upon what is actually received, but upon what is received as a net income, plus a multiple of one-sixteenth, which represents the Income Tax paid upon that net income. Let me give an example. Assuming the income was a multiple of £1,600, and that £100 had been paid in Income Tax, the Super-tax would not be payable upon a multiple of £1,600, but you would have to add one-sixteenth of the income—that is, £100—added to the £1,600, so as to make it £1,700, and Super-tax would have to be paid on £1,700. Therefore, it is quite deceptive to say that a Super-tax at the rate of 1s. 4d. in the £ is the maximum. It is, in fact, a Super-tax of 1s. 5d. in the £, and not 1s. 4d., that is the maximum. Where the Super-tax is 8d. in the £, so-called under this Resolution, it is in fact 8½d. in the £, because the tax is payable not upon the net income, but upon the net income plus the Income Tax. Surely it would be wiser when a tax is being made that the actual amount should be stated and not an amount which is really deceptive, and which does not give credit to the Super-tax payer. I think he is entitled to the credit of that, but by this proposal he is cheated of one-sixteenth of the credit due to him. I suggest that it is good finance and common honesty that the figures should be graduated in that way.
    Mr. LLOYD GEORGE: The hon. Gentleman's proposal is really one for the reduction of the Super-tax. [An Hon. MEMBER: "No!"] At any rate, it is in the direction of a graduated scale. If the hon. Member looks at the White Paper and refreshes his memory, he will find that

    1431
    the present scale is graduated and there is no break at the Super-tax point. You might as well in the case of an income of £2,500 take the Income Tax and pay on £1,000, and then pay the balance, deducting the amount of the Income Tax. That is really a method of valuation—at any rate it is a point for the Committee and not one for the Report stage.
    Mr. BUTCHER: I really think the right hon. Gentleman has misunderstood the point. This is not a question of graduation at all. My hon. Friend suggests that you should put into your Schedule the true amount of the percentage of Super-tax which you are levying on the net income. Suppose a man receives £1,500 in cash less his Income Tax, when he is called upon to pay Super-tax he pays not upon £1,500, but upon £1,600, or £100 more than he receives. My hon. Friend does not want to reduce the amount of the Super-tax paid, but the percentage on the net amount, so as to show a true percentage and not a fictitious one. As matters stand you are putting down a really fictitious percentage, because you are charging a tax upon money which has never been received. Would the right hon. Gentleman alter the amount paid for Super-tax so as to make it a true percentage upon the net amount received?
    Mr. G. LOCKER-LAMPSON: I want to put one point to the Chancellor of the Exchequer. Under the present law Super-tax is a tax of the year of assessment, but for the purpose of calculation it is a tax on the income of the preceding year. Take a man with an income of £4,500, ho dies in the year of assessment and only gets half that income, namely, £2,250. Under the Re venue Act of 1912 he is allowed an abatement proportionate to the period during which he lives, and he has to pay Super-tax on £1,000, although he receives money to the extent of £2,250. I think that is a point which the Chancellor of the Exchequer might consider. There is one more point with regard to the Super-tax I should like to bring before his notice. A man with an income of £3,500, derived from employment and from investments, may in the year of assessment be deprived of his employment and merely go on receiving money from his investments, coming, say, to an income of about £2,000 a year, but in spite of that in the year of assessment he has to pay
    1432
    Super-tax on a sum of money which does not reach the Super-tax limit. I do not know whether the Chancellor of the Exchequer will remember these points when he comes to deal with the Revenue Bill, but I hope that he will think them worthy of consideration.
    Mr. WATSON RUTHERFORD: When we listened to the Chancellor of the Exchequer, and he gave us the total of the Income Tax and the Super-tax on various incomes, we were, of course able to understand that a man with a very large income would be paying a tax at the rate of 2s. 7½d. upon his income, and that people with smaller incomes would be paying smaller amounts in proportion. The point I wish to draw attention to is the annoyance to the taxpaying community owing to the way in which this tax is levied, and owing to the way in which the present Chancellor of the Exchequer has divided it into two parts. All taxpayers who pay Super-tax at the present time have got to deal with two sets of officials. They first of all have got to deal with a set of officials in an entirely different office in relation to their Income Tax. It sometimes takes weeks and months to get various points cleared up and appeals disposed of. When that is done they have to deal with Super-tax. Exactly the same points are often raised, and all the annoyance, time, confusion and difficulty is doubled. I think, if his tax were frankly and straightforwardly fixed at the figure at which it is intended to be imposed in a graduated scale, so that one set of people would have to be dealt with, it would be a great boon to the commercial business community, who in these days have not got the time to waste upon getting out these particulars and going into these matters in the way in which they really ought to be dealt with if the right amounts are assessed. If he has got a certain amount of money to raise by way of Income Tax, it is the duty of the Chancellor of the Exchequer to lay that tax, and to have it imposed in such a manner as to cause the least possible annoyance and the least possible consumption of time to the various people who have got to pay the tax, whereas I contend that, under the way in which it is at present done, the exact opposite is the case.
    Major WHITE: I should like to support the arguments of my hon. Friends the Members for Colchester (Mr. Worthington Evans)

    1433
    and York (Mr. Butcher), and to put this point to the Chancellor. In charging Super-tax on the gross, especially where the money is derived from dividends you are charging a man Super-tax on what is not his income, but is the income of the State at the moment, because it is deducted before it ever becomes his property. Therefore, you are charging a man a tax on what is really the revenue of the State at that moment. I think that it is a case the Chancellor of the Exchequer might consider in regard to the Amendment of my hon. Friend.

    EARNED INCOME.
    Resolution reported,
    3. "That—

    (a) the relief given in respect of earned income shall be modified so as to allow relief only as follows:—

    Relief by way of reduction of the tax to nine pence in cases where the total income does not exceed one thousand pounds;

    Relief by way of reduction of the tax to ten pence half-penny in cases where the total income exceeds one thousand pounds and does not exceed one thousand five hundred pounds;

    Relief by way of reduction of the tax to one shilling in cases where the total income exceeds one thousand five hundred pounds and does not exceed two thousand pounds;

    Relief by way of reduction of the tax to one shilling and two pence in cases where the total income exceeds two thousand pounds but does not exceed two thousand five hundred pounds; and

    (b) it is declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913."

    Resolution read a second time.
    Mr. CHAMBERLAIN: I wish to move, in paragraph (a), to leave out the word "only" ["to allow relief only."]
    I agree with the Chancellor of the Exchequer that it is undesirable, if it can be avoided, to discuss details of the Resolution on the Report stage. But I think the word "only" in this case would limit the discretion of Members to move Amendments on the Bill which it might be desirable
    1434
    to have discussed, and I hope therefore the Chancellor of the Exchequer will accept the Amendment.
    Mr. LLOYD GEORGE: I wish the right hon. Gentleman had given me an opportunity of consulting my advisers.
    Mr. CHAMBERLAIN: It only struck me as I heard the Resolution read.
    Mr. LLOYD GEORGE: The right hon. Gentleman knows how dangerous it is to accept Amendments to a Resolution like this without previous consultation to find out the effect. I am not sure what the effect would be. The right hon. Gentleman's idea is that the insertion of the word "only" would prevent the moving of further abatements. I should like to have the opinion of the Speaker on that. I should not have thought it would have had that effect. It would be in order to move an abatement, but nothing in the way of addition.
    Mr. SPEAKER: I think it would be open for anybody to move an Amendment which would be in favour of the subject.
    Mr. CHAMBERLAIN: In spite of the word "only"?
    Mr. SPEAKER: I think so, so long as the subject is not put in a worse position. An Amendment could be moved which would put him in a better position.
    Amendment, by leave, withdrawn.

    INCOME FROM FOREIGN PROPERTY.
    Resolution reported,
    4. "That Income Tax, including Super-tax, shall be charged on the income arising from securities or possessions in any place out of the United Kingdom, whether that income is received in the United Kingdom or not;
    And it is declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913."
    Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
    Mr. WORTHINGTON EVANS: We have had no explanation from the Chancellor of the Exchequer with regard to this Resolution. In his Budget Statement the right hon. Gentleman said he expected to receive £250,000 this year, £500,000 next year, and ultimately £1,000,000. But he did not tell us how much capital is invested abroad, the income of which does not come to this country, but which will become subject to this Resolution. The right hon. Gentleman told us he expected to enforce payment of this tax by means of a Declaration, which would be checked upon the ultimate proof of the estate of the person making the Declaration when death occurred. That is a means of checking the capital, but it is not necessarily a means of checking income, and when we come to discuss the Bill we may have to put in some further protection, if the tax is really to realise the anticipations of the right hon. Gentleman. I do not want to enter into that discussion to-night; it would be more appropriate to the Bill itself. I only ask the Chancellor of the Exchequer to tell us what are his estimates of capital as well as his estimate of tax. I make the suggestion to him, that if ultimately £1,000,000 of tax is going to arise, it will be on the assumption that something like £200,000,000 of capital is invested abroad and is escaping taxation now. Two-hundred million pounds invested at 5 per cent. would give an income of £10,000,000 a year, and, with a tax of 2s. in the £, would give the result the Chancellor of the Exchequer gave, of £1,000,000 a year in tax. That is one way of arriving at the figure of £1,000,000, but there are many other ways of arriving at it, and I want to know how the Chancellor of the Exchequer arrived at it. It would be interesting to the House if he would give that, more especially as a more detailed discussion will be necessary when the Bill comes before the House.
    Mr. LLOYD GEORGE: The hon. Gentleman is wrong in saying that this matter has not been discussed. It was discussed on the Committee stage, when the suggestion was made that I had considerably underestimated the amount which would be received from this particular form of taxation. That was the view of the right hon. Gentleman opposite (Mr. Chamberlain), and others made the same sort of criticism upon my Estimate. I cannot give the hon. Gentleman
    1436
    the actual figures now, but I will undertake to give them to him in the course of the next few days. If that will serve his purpose I shall be glad to do so.
    Mr. FELL: This is the first time we have passed such a Resolution, and I would ask whether these words are not much too broad and should not be limited in some way. Income arising from securities or possessions might easily enough be the income of persons not capable of being protected in this country—
    Mr. LLOYD GEORGE: May I interrupt the hon. Gentleman? This is an enabling Resolution, and, as he knows very well, such Resolutions are always drafted in the widest possible terms. It will be a Section of an Act of Parliament that he will have to watch very carefully. As soon as these Resolutions are passed, and I am in a position to introduce the Finance Bill, the hon. Member will be able to scrutinise the actual terms of the Clause, and he will find that they are narrower than the Resolution.
    Viscount HELMSLEY: That is a plausible explanation, but as the Resolution comes under the Provisional Collection of Taxes Act, is it not important that the Resolution should be drawn more narrowly, because under that Act the subject becomes liable to pay the tax as soon as the Resolution is passed by the House, if the Finance Bill is brought in within a given time. The Resolution ought to be so drawn as not to include in the net people who are not really liable, otherwise the Chancellor of the Exchequer might be landing himself in future difficulties.
    Mr. LLOYD GEORGE: I do not expect to be able to collect very much of this particular tax before Monday next. By that time the actual terms of the Clause will be in the possession of hon. Members.

    SETTLEMENT ESTATE DUTY.
    Resolution reported,
    6. "That, in the case of persons dying after the fifteenth day of August, nineteen hundred and fourteen, the relief from the payment of Death Duties given in respect of settled property when Estate Duty has already been paid in respect of the property since the date of the settlement, and the similar relief given under Section twenty-one of The Finance Act, 1894, where the duties mentioned in that Sub-section have been paid or are payable and under Sub-section (16) of Section twenty-three of the same Act in the case of entailed estates in Scotland shall cease; and Settlement Estate Duty shall no longer be charged."
    Resolution read a second time.
    Mr. BUTCHER: I beg to move after the word "That" ["That, in the case of persons dying"] to insert the words "except
    1448
    where the only life interest in the property after the death of the deceased is that of the wife or husband of the deceased."
    The reason I move this Amendment is in the first place that the proposal of the Chancellor of the Exchequer, embodied in the Resolution, violates what was really the fundamental principle of Sir William Harcourt's Budget of 1894. Let me read the passage in which Sir William Harcourt proposed to deal with this subject.
    "It is felt that it would not be fair to require a full payment on each devolution"—
    That is in the case of settled property—
    "within the scope of the settlement where the beneficiary takes only a limited interest and thus treat a man with only a life interest on the same footing as one who had the absolute disposal of the estate."
    And for that reason he made this provision, that only one Estate Duty should be paid during the continuance of the settlement, but that to compensate the Exchequer, a small additional duty, namely, a Settlement Estate Duty

    1449
    should be paid. That was the principle laid down by Sir William Harcourt, and I beg the House to remember this was not a matter of detail in taxation, but was laid down by Sir William Harcourt as a principle. Let the House mark how the present Chancellor of the Exchequer departs from that, and justifies that departure. He said in his Budget speech this year:—
    "Enjoyment of property is enjoyment for life and therefore there is no real ground to distinguish between settled property and property that is not settled."
    Was ever such an extraordinary proposition uttered I will not say by a Chancellor of the Exchequer but by the most ignorant layman who ever took upon himself to talk about property at all. The merest tyro of finance knows that there is all the difference in the world between receiving an income from property and being entitled to take the capital, and yet the Chancellor of the Exchequer says there is no real ground for distinction between settled property and property which is not settled. That is the argument by which he defends the present proposal and, as that argument is obviously unsound, his defence of the proposal falls to the ground. But that is not all, because on the strength of the principle laid down by Sir William Harcourt, and the assurance he gave that settled estates would only be subject to one Estate Duty, an enormous number of estates were settled, and many were settled which would otherwise never have been settled. What is the result of that? In the first place it was a disadvantage to the settlor who, instead of having the right to sell and dispose of his property, was tied up to a life interest and treated on that footing. Not only was this to the disadvantage of the settlors, but it was to the advantage of the Chancellor of the Exchequer, because he got very large sums of money into the coffers of the Exchequer in the shape of Settlement Stamp Duties. Therefore, I think I am quite right in saying that owing to the principle laid down by Sir William Harcourt a large number of estates were settled to the disadvantage of the settlors and to the advantage of the Chancellor of the Exchequer.
    Let me point out two special and exceedingly hard cases which have arisen. The first is where a man leaves property to his wife for life and then to his children. Under the existing law when a settlement by a will of that character is made only one Estate Duty is payable, namely, when
    1450
    the husband dies who leaves the property. Not only is there only one Estate Duty payable, but no settlement Estate Duty is payable at all. The property goes to the children on the death of the wife, and there is only one Estate Duty payable on that property. What does the Chancellor of the Exchequer now do? He says that in a case of that kind he will double the Estate Duties by making the Estate Duty payable on the death of the testator, and payable again on the death of the wife, so that before the children get anything two sets of Estate Duty have to be paid. No one will say that that is reasonable, and indeed the Chancellor of the Exchequer the other day indicated that he was prepared to consider that point, and I am now giving the right hon. Gentleman an opportunity of carrying out his promise. Take the case of the ordinary marriage settlement, whether of money or of land, in which successive life estates are given to the husband and wife, and then subject to those life estates the property is given to the children. Under the existing law in a settlement of that sort only one Estate Duty is payable, and no Settlement Estate Duty at all. Under the proposal of the Chancellor of the Exchequer you have first an Estate Duty payable on the death of the husband or the wife, whoever dies first, and a second Estate Duty payable on the death of the survivor of the husband or wife, so that before the children get it in that case again two sets of Estate Duty are payable. I do put it to the Chancellor of the Exchequer that is an exceedingly unfair thing to do. It is especially unfair where the settlement has been made before the present proposed alteration, but I say also that it is unreasonable in the case of future settlements which may be made hereafter. Therefore, the Amendment which I propose is for the purpose of preventing this alteration of the law in cases where the only life interests in the settlement are those of husband and wife. My Amendment is limited to those cases. I ask the House to say that the existing law is fair and that it remains as fair now as when Sir William Harcourt said it was reasonable and proper in 1894.
    Mr. S. ROBERTS: I beg to second the Amendment.
    I have not been able to understand up to now the reason the Chancellor of the Exchequer is proposing to make this alteration. Sir William Harcourt in the year 1894 brought in a

    1451
    graduated scale of Death Duties. Prior to that there was a fixed Probate Duty of three per cent. Sir William Harcourt saw, when he was graduating the Duties, that it would not be fair to treat life interest in the same way. My hon. Friend has quoted the words of Sir William Harcourt in his Budget speech. I entirely agree with what my hon. Friend has said. Since Sir William Harcourt's time the present Government have graduated the scale further, very largely in the year 1909, and again in the present Budget. Therefore, I say there is all the more reason a fortiori for preserving the privileges of the people beneficiary entitled. Further than that I say that on the grounds of public policy and justice, it is not good policy to discourage settlements, and this is a discouragement of settlements. When a man has a certain property to leave to his wife and family, and when that family consists of young children, it is not good policy to leave that property absolutely to those children. A settlement either by will or possibly by a marriage settlement is good public policy, but the Chancellor of the Exchequer in this provision is taking away a privilege and, to a certain extent, an inducement to a man to leave his property in that way. Whatever the Chancellor of the Exchequer may decide to do, I would prefer that he should leave the Estate Duty as it is. He raised it himself from one to two per cent., and why cannot he leave it as it is?
    Mr. LLOYD GEORGE: I spoke at some length on this question of the Settlement Estate Duty, and I do not now propose to repeat my answer, but I will deal with the specific case mentioned by the hon. and learned Member for York (Mr. Butcher). I do not take the general view stated by the hon. Member for Sheffield (Mr. S. Roberts). Indeed, I take a totally different view of the ordinary sort of settlement. I do not think the law should go out of its way to encourage such settlements. But that was not the point taken by the hon. and learned Member for York. His was a case where a man leaves his property to his wife for life and afterwards to the children.
    Mr. BUTCHER: And where he settles it by marriage settlement.
    Mr. LLOYD GEORGE: At any rate, where the property is left to the wife for life. If the Amendment does not mean that, I do not know what it means.
    Mr. BUTCHER: It does mean that.
    Mr. LLOYD GEORGE: I propose to accept that on the understanding it docs meet the case where the property is left to the wife for life and after to the children.
    Mr. BUTCHER: I entirely agree with the right hon. Gentleman that he does meet that particular case, but it was only one of the cases pointed out by me. But there is another case dealt with by the Amendment where a marriage settlement is made in which the only life interests are those of the husband and wife, and then there is a gift to the children. I think that is substantially the same case.
    Mr. LLOYD GEORGE: I agree that whereby the same disposition arranges after the decease of one or the other the property should pass to either before it passes to the children, it is a case on a totally different footing to the case put by the hon. Member for Sheffield. I agree that that is a case where the State should not put any discouragement; and if the Amendment really applies to that I will accept it. I think the Bill has been drafted in that form already.
    Question, "That those words be there inserted," put and agreed to.
    Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
    Mr. CASSEL: I want to point out that one consideration has been overlooked in making this provision retrospective. Life assurance companies have very largely advanced money on reversions on the footing that the Death Duties shall not be paid where the Settlement Estate Duty has been paid. Money has been advanced and purchases of reversions have been carried through on the footing that the payment of the Settlement Estate Duty had freed the reversion from the payment of Death Duties. The result is that if an extra 10 or 15 per cent. is to be taken, the capital security which otherwise was a good security would become a bad security, and the profit which would have been made on the transaction becomes a loss. No doubt these companies do take into account and ought to take into account the fact that the rates of duty may be altered. But they do not take into account, and they ought not to be called upon to take into account such a risk when the money has been advanced on the understanding that no Death Duties at all will be payable. But

    1453
    although the money has been advanced or paid on that footing, the subject who has paid or advanced it may find he has made an actual loss or has got a bad security. In view of the fact that there have been large transactions by insurance companies in this country on these lines, I hope the right hon. Gentleman will take this point into consideration before he introduces his Finance Bill.
    Mr. LLOYD GEORGE: That is one of the points which I am considering at the present moment.
    Captain CLIVE: Will the right hon. Gentleman tell us what the financial effect of the Resolution will be. He told us in his Budget speech that it will produce £150,000 this year and £900,000 next year. Is that the net sum it will produce? When a proposal was made that existing settlements should not be affected the right hon. Gentleman said he could not possibly do that, because he would lose not only the £900,000, but also a sum of £800,000 through the ceasing of the making of fresh settlements.
    Mr. LLOYD GEORGE: It will be about £700,000.
    Captain CLIVE: Is that taking into consideration the concession the right hon. Gentleman has just made?
    Mr. LLOYD GEORGE: Yes.
    Mr. WHELER: With reference to those who have already paid this duty, in cases where it has not been possible for them to pay it in one lump sum they have been paying in instalments, will the Government repay the interest which those who could not pay the full sum at once were charged by the Government?
    Mr. LLOYD GEORGE: I should not like to answer off-hand, but I will look into the matter and let the hon. Gentleman know.
    12.0 M.
    Mr. RADFORD: My anxiety has been greatly relieved by the Chancellor of the Exchequer's acceptance of the Amendment, but I still have one remaining anxiety which I hope he will be able to remove. We are dealing with Settlement Estate Duty which was imposed by the Act of 1894 and increased by the right hon. Gentleman's later Act. Since 1894 a great many settlements have been executed on
    1454
    the faith of the text of the Act of 1894, which is still in force. I hope the Chancellor of the Exchequer will not do anything in the nature of ex post facto legislation. Sir William Harcourt said that Settlement Estate Duty was imposed for the purpose of freeing property comprised in the settlement during the whole period of the lives comprised in the settlement, and Sir William Harcourt stated that no further Settlement Estate Duty would be payable during the currency of the settlement. The matter does not rest merely on the words of Sir William Harcourt; it is embodied in the Act of Parliament, and the Finance Act, 1894, says in express terms that during the continuance of the settlement Settlement Estate Duty shall not be payable more than once. It seems to me that if we are going to say, now, notwithstanding the fact that Settlement Estate Duty has been paid and the Chancellor of the Exchequer has got the money in his pocket, that he will exact Estate Duty again and again as the successive lives fall in, he is doing something which is open to grave objection. I hope that is not the intention of the Chancellor of the Exchequer, and I hope that his real meaning is that this abolition of the Settlement Estate Duty and the imposition in its place of Estate Duty, from generation to generation, as it accrues, is only intended to apply to wills and settlements which come into operation after the commencement of this Act. If that is not his intention, at any rate there surely is an injustice in exacting from a man two per cent. on the representation that the next succession to his estate will be free of duty and then passing an Act and saying to that man, who has paid his money which the State has acquired, that notwithstanding the assurance contained in the Act of Parliament, we are going to demand money of him again.
    The least the Chancellor of the Exchequer could do, if he intends to apply this Act to settlements which were made before the Act comes into operation, is to give credit to a man who has paid Settlement Estate Duty for the amount which he has paid against the next payment of Estate Duty. In the Finance Act of 1894, Sir William Harcourt had a somewhat similar proposition to deal with, because in that case, where he first imposed Settlement Estate Duty, he had to deal with what he recognised as the legitimate

    1455
    grievance of persons who had already settled their property and paid ad valorem duty in respect of those settlements. The Act of 1894 provided that where a man, in consequence of the provisions of that Act, was called upon to pay Estate Duty he might take credit on account of that payment for the amount previously paid by way of ad valorem duty on a settlement. I hope we may receive some assurance from the Chancellor of the Exchequer with regard to this, or at any rate, that he will give what attention is due to the considerations I have laid before him.
    Mr. WORTHINGTON EVANS: The Amendment that my hon. and learned Friend has proposed and which I understand is accepted by the Chancellor of the Exchequer, has cut down very largely the effect of this Clause. But even if one case
    remains within it, I would appeal to the Chancellor not to commit a breach of faith in keeping in even that one case. The taxpayer has paid to the Government two per cent. on the faith of words which are in the Statute, that, during the continuance of the settlement. Settlement Estate Duty shall not be payable more than once. After having received the two per cent. in consideration of the contract, the Government is going to alter the contract. That seems to me to be a gross breach of faith and even if it only affects half-a-dozen cases—it would affect a great many more—the Government ought to be ashamed to take money under these conditions.
    Question put, "That this House doth agree with the Committee in the said Resolution, as amended."
    The House divided: Ayes, 209; Noes, 134.

    Division No. 107.]

    AYES.

    [12.5 a.m.

    Abraham, William (Dublin, Harbour)

    Esmonde, Sir Thomas (Wexford, N.)

    Lardner, James C. R.

    Adamson, William

    Essex, Sir Richard Walter

    Lawson, Sir W. (Cumb'rld, Cockerm'th)

    Allen, Arthur A. (Dumbartonshire)

    Falconer, James

    Levy, Sir Maurice

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

    Farrell, James Patrick

    Lewis, Rt. Hon. John Herbert

    Arnold, Sydney

    Fenwick, Rt. Hon. Charles

    Lundon, Thomas

    Baring, Sir Godfrey (Barnstaple)

    Ffrench, Peter

    Lynch, Arthur Alfred

    Barran, Sir John N. (Hawick Burghs)

    Field, William

    Macdanold, J. Ramsay (Leicester)

    Beck, Arthur Cecil

    Flavin, Michaei Joseph

    Macdonald, J. M. (Falkirk Burghs)

    Benn, W. W. (T. Hamlets, St. George)

    Gelder, Sir W. A.

    Maclean, Donald

    Bentham, G. J.

    George, Rt. Hon. D. Lloyd

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

    Birrell, Rt. Hon. Augustine

    Gill, A. H.

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

    Black, Arthur W.

    Gladstone, W. G. C.

    Macpherson, James Ian

    Boland, John Plus

    Glanvilie, Harold James

    MacVeagh, Jeremiah

    Booth, Frederick Handel

    Goldstone, Frank

    M'Ghee, Richard

    Bowerman, Charles W.

    Greig, Colonel J. W.

    McKenna, Rt. Hon. Reginald

    Boyle, Daniel (Mayo, North)

    Griffith, Ellis Jones

    M'Laren, Hon. F. W. S. (Lincs., Spalding)

    Brady, Patrick Joseph

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

    Marshall, Arthur Harold

    Brocklehurst, W. B.

    Gulland, John William

    Meagher, Michael

    Buckmaster, Sir Stanley O.

    Gwynn, Stephen Lucius (Galway)

    Meehan, Francis E. (Leitrim, N.)

    Burns, Rt. Hon. John

    Hackett, John

    Meehan, Patrick J. (Queen's Co., Leix)

    Bytes, Sir William Pollard

    Harcourt, Rt. Hon. Lewis (Rossendale)

    Millar, James Duncan

    Carr-Gomm, H. W.

    Harcourt, Robert V. (Montrose)

    Molloy, Michael

    Cawley, Harold T. (Lancs., Heywood)

    Harvey, T. E. (Leeds, West)

    Mond, Rt. Hon. Sir Alfred

    Chancellor, Henry George

    Haslam, Lewis (Monmouth)

    Money, L. G. Chiozza

    Chapple, Dr. William Allen

    Hayden, John Patrick

    Montagu, Hon. E. S.

    Clancy, John Joseph

    Hayward, Evan

    Mooney, Joseph J.

    Clough, William

    Hazleton Richard

    Morgan, George Hay

    Collins, Sir Stephen (Lambeth)

    Helme, Sir Norval Watson

    Muldoon, John

    Condon, Thomas Joseph

    Henry, Sir Charles

    Munro, Rt. Hon. Robert

    Cornwall, Sir Edwin A.

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

    Murphy, Martin J.

    Cotton, William Francis

    Higham, John Sharp

    Murray, Captain Hon. Arthur C.

    Crumley, Patrick

    Hinds, John

    Nolan, Joseph

    Cullinan, John

    Hodge, John

    Nugent, Sir Walter Richard

    Dalziel, Rt. Hon. Sir J. H. (Kirkcaldy)

    Hogge, James Myles

    Nuttall, Harry

    Davies, David (Montgomery Co.)

    Hughes, Spencer Leigh

    O'Brien, Patrick (Kilkenny)

    Davies, Ellis William (Eifion)

    Illingworth, Percy H.

    O'Connor, John (Kildare, N.)

    Davies, Timothy (Lincs., Louth)

    John, Edward Thomas

    O'Connor, T. P. (Liverpool)

    Davies, Sir W. Howell (Bristol, S.)

    Jones, Edgar (Merthyr Tydvil)

    O'Doherty, Philip

    Dawes, James Arthur

    Jones, H. Haydn (Merioneth)

    O'Donnell, Thomas

    Delany, William

    Jones, J. Towyn (Carmarthen, East)

    O'Dowd, John

    Devlin, Joseph

    Jones, Leif (Notts, Rushcliffe)

    O'Kelly, Edward P. (Wicklow, W.)

    Dillon, John

    Jones, William S. Glyn-(Stepney)

    O'Kelly, James (Roscommon, N.)

    Donelan, Captain A.

    Jowett, F. W.

    O'Malley, William

    Doris, William

    Joyce, Michael

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

    Duffy, William J.

    Kelly, Edward

    O'Shaughnessy, P. J.

    Duncan, C. (Barrow-in-Furness)

    Kenyon, Barnet

    O'Shee, James John

    Duncan, J. Hastings (Yorks, Otley)

    Kilbride, Denis

    O'Sullivan, Timothy

    Edwards, Sir Francis (Radnor)

    King, Joseph

    Outhwaite, R. L.

    Elverston, Sir Harold

    Lambert, Rt. Hon. G. (Devon, S. Molton)

    Parker, James (Halifax)

    Esmonde, Dr. John (Tipperary, N.)

    Lambert, Richard (Wilts, Cricklade)

    Parry, Thomas H.

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

    Robertson, John M. (Tyneside)

    Ward, John (Stoke-upon-Trent)

    Phillips, John (Longford, S.)

    Robinson, Sidney

    Warner, Sir Thomas Courtenay T.

    Ponsonby, Arthur A. W. H.

    Roch, Walter F. (Pembroke)

    Wason, John Cathcart (Orkney)

    Pratt, J. W.

    Roche, Augustine (Louth)

    Watt, Henry A.

    Price, C. E. (Edinburgh, Central)

    Rowlands, James

    Webb, H.

    Price, Sir Robert J. (Norfolk, E.)

    Russell, Rt. Hon. Thomas W.

    White, J. Dundas (Glasgow, Tradeston)

    Primrose, Hon. Neil James

    Scanlan, Thomas

    White, Patrick (Meath, North)

    Pringle, William M. R.

    Seely, Rt. Hon. Colonel J. E. B.

    Whyte, Alexander F. (Perth)

    Radford, George Heynes

    Sheehy, David

    Wilkie, Alexander

    Raffan, Peter Wilson

    Simon, Rt. Hon. Sir John Allsebrook

    Williams, Aneurin (Durham, N. W.)

    Rea, Rt. Hon. Russell (South Shields)

    Smith, Albert (Lancs., Clitheroe)

    Williams, John (Glamorgan)

    Rea, Walter Russell (Scarborough)

    Smyth, Thomas F. (Leitrim, S.)

    Williams, Penry (Middlesbrough)

    Reddy, Michael

    Sutherland, John E.

    Wilson, Rt. Hon. J. W. (Worcs., N.)

    Redmond, John E. (Waterford)

    Taylor, John W. (Durham)

    Wilson, W. T. (Westhoughton)

    Redmond, William (Clare, E.)

    Taylor, Theodore C. (Radcliffe)

    Wing, Thomas Edward

    Redmond, William Archer (Tyrone, E.)

    Taylor, Thomas (Bolton)

    Yeo, Alfred William

    Rendall, Athelstan

    Tennant, Harold John

    Young, William (Perthshire, East)

    Richardson, Thomas (Whitehaven)

    Toulmin, Sir George

    Roberts, Charles H. (Lincoln)

    Trevelyan, Charles Philips

    TELLERS FOR THE AYES.—Mr.

    Roberts, George H. (Norwich)

    Verney, Sir Harry

    Wm. Jones and Mr. Geoffrey Howard.

    Roberts, Sir H. (Denbighs)

    Walton, Sir Joseph

    NOES.

    Agnew, Sir George

    Fitzroy, Hon. Edward A.

    Paget, Almeric Hugh

    Amery, L. C. M. S.

    Foster, Philip Staveley

    Parkes, Ebenezer

    Anson, Rt. Hon. Sir William R.

    Gibbs, G. A.

    Pearce, Robert (Staffs, Leek)

    Ashley, Wilfrid W.

    Gilmour, Captain John

    Pease, Herbert Pike (Darlington)

    Baird, John Lawrence

    Glazebrook Captain Philip K.

    Perkins, Walter F.

    Baker, Sir Randolf (Dorset, N.)

    Goldman, C. S.

    Pirie, Duncan V.

    Banbury, Sir Frederick George

    Greene, Walter Raymond

    Pole-Carew, Sir R.

    Barlow, Montague (Salford, South)

    Gretton, John

    Pollock, Ernest Murray

    Barnston, Harry

    Guinness, Hon. W. E. (Bury S. Edmunds)

    Pryce-Jones, Colonel E.

    Barrie, H. T.

    Gwynne, R. S. (Sussex, Eastbourne)

    Rawson, Colonel R. H.

    Bathurst, Charles (Wilts, Wilton)

    Hall, D. B. (Isle of Wight)

    Rees, Sir J. D.

    Beauchamp, Sir Edward

    Hall, Frederick (Dulwich)

    Ronaldshay, Earl of

    Beckett, Hon. Gervase

    Hamilton, C. G. C. (Ches., Altringham)

    Samuel, Samuel (Wandsworth)

    Benn, Arthur Shirley (Plymouth)

    Hardy, Rt. Hon. Laurence

    Sanders, Robert Arthur

    Benn, Ion Hamilton (Greenwich)

    Harris, Henry Percy

    Sandys, G. J.

    Bird, Alfred

    Harrison-Broadley, H. B.

    Scott, Sir S. (Marylebone, W.)

    Boyton, James

    Helmsley, Viscount

    Sharman-Crawford, Colonel R. G.

    Bridgeman, William Clive

    Henderson, Major H. (Berks, Abingdon)

    Smith, Harold (Warrington)

    Bryce, J. Annan

    Hill-Wood, Samuel

    Spear, Sir John Ward

    Burn, Colonel C. R.

    Hohler, Gerald Fitzroy

    Stanier, Beville

    Butcher, John George

    Holt, Richard Durning

    Stanley, Hon. G. F. (Preston)

    Campion, W. R.

    Hope, James Fitzalan (Sheffield)

    Starkey, John R.

    Carlile, Sir Edward Hildred

    Hope, Major J. A. (Midlothian)

    Talbot, Lord Edmund

    Cassel, Felix

    Home, Edgar (Surrey, Guildford)

    Terrell, George (Wilts, N. W.)

    Castlereagh, Viscount

    Horner, Andrew Long

    Thynne, Lord Alexander

    Cautley, H. S.

    Hunt, Rowland

    Touche, George Alexander

    Cawley, Sir Frederick (Prestwich)

    Jardine, Ernest (Somerset, East)

    Tryon, Captain George Clement

    Chaloner, Colonel R. G. W.

    Kerr-Smiley, Peter Kerr

    Valentia, Viscount

    Clay, Captain H. H. Spender

    Kerry, Earl of

    Warde, Colonel C. E. (Kent, Mid)

    Clive, Captain Percy Archer

    Kinloch-Cooke, Sir Clement

    Watson, Hon. W.

    Clyde, J. Avon

    Kyffin-Taylor, G.

    White, Major G. D. (Lancs., Southport)

    Coates, Major Sir Edward Feetham

    Lane-Fox, G. R.

    Williams, Colonel R. (Dorset, W.)

    Cooper, Sir Richard Ashmole

    Larmor, Sir J.

    Willoughby, Major Hon. Claud

    Cory, Sir Clifford John

    Lewisham, Viscount

    Wills, Sir Gilbert

    Courthope, George Loyd

    Lloyd, George Butler (Shrewsbury)

    Wilson, A. Stanley (Yorks, E. R.)

    Craig, Ernest (Cheshire, Crewe)

    Locker-Lampson, O. (Ramsey)

    Wilson, Hon. G. G. (Hull. W.)

    Craig, Norman (Kent, Thanet)

    Lyttelton, Hon. J. C.

    Wilson, Captain Leslie O. (Reading)

    Crichton-Stuart, Lord Ninian

    Mackinder, H. J.

    Wilson, Maj. Sir M. (Bethnal Green. S. W.)

    Currie, George W.

    Mason, James F. (Windsor)

    Wood, John (Stalybridge)

    Dalrymple, Viscount

    Morrison-Bell, Major A. C. (Honiton)

    Worthington Evans, L.

    De Forest, Baron

    Mount, William Arthur

    Yate, Colonel Charles Edward

    Denison-Pender, J. C.

    Neville, Reginald J. N.

    Younger, Sir George

    Dixon, C. H.

    Newdegate, F. A.

    Duke, Henry Edward

    Nicholson, William G. (Petersfield)

    TELLERS FOR THE NOES.—Mr.

    Eyres-Monsell, Bolton M.

    O'Neill, Hon. A. E. B. (Antrim, Mid)

    Samuel Roberts and Mr. Wheler.

    Faber, George Denison (Clapham)

    Ormsby-Gore, Hon. William

    Resolution agreed to.

    Bill ordered to be brought in upon the said Resolutions by the Chairman of Ways and Means, the Chancellor of the Exchequer, and Mr. Montagu.

    FINANCE BILL.
    "Bill to continue the Duty of Customs on Tea, to re-impose Income Tax and
    1458
    Super-tax with Amendments and modifications, and to amend the Law relating to Death Duties, the National Debt, and Grants for Local Purposes, and for purposes incidental thereto." Presented accordingly, and read the first time; to be read a second time upon Monday next, and to be printed. [Bill 251.]

  WAYS AND MEANS [11th May].—REPORT.

    AMENDMENT OF LAW.
    Resolution reported,
    7. "That it is expedient to amend the Law relating to National Debt, Customs, and Inland Revenue (including Excise)."
    Bill ordered to be brought in upon the said Resolution by the Chancellor of the Exchequer, Mr. Herbert Samuel, the Attorney-General, the Solicitor-General, and Mr. Montagu.

    REVENUE BILL.
    Bill "to amend the Law relating to Customs and Inland Revenue (including
    1460
    Excise) and for other purposes connected with Finance." Presented accordingly, and read the first time; to be read a second time upon Monday next, and to be printed. [Bill 252.]
    The remaining Orders were read and postponed.
    It being after half-past Eleven of the clock upon Thursday evening, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
    Adjourned at Twenty-two minutes after Twelve o'clock.

BUDGET PROPOSALS.
  DUTIES (ESTIMATED RECEIPTS).
  DUTIES (ESTIMATED RECEIPTS).
  SCOTLAND.
  SCOTLAND.
  IRELAND.
  IRELAND.
  LOCAL AUTHORITIES (GRANTS).
  LOCAL AUTHORITIES (GRANTS).
  SUPER-TAX.
  SUPER-TAX.
NATIONAL INSURANCE ACT.
  DEDUCTIONS FROM PAY (ROYAL NAVY).
  DEDUCTIONS FROM PAY (ROYAL NAVY).
  National Finance.
  National Finance.
  Voluntary Schools (Rates).
  Voluntary Schools (Rates).
  Motor Spirit (Duty Collected).
  Motor Spirit (Duty Collected).
  Recovery of Arrears (Ireland).
  Recovery of Arrears (Ireland).
  Land Purchase (Ireland).
  Land Purchase (Ireland).
  Foot-and-Mouth Disease.
  Foot-and-Mouth Disease.
  London and Provincial Licensed Vehicle Workers.
  London and Provincial Licensed Vehicle Workers.
  Shops Act (Manchester).
  Shops Act (Manchester).
  Thorp Schools, Surrey.
  Thorp Schools, Surrey.
POST OFFICE.
  SUB-ENGINEERS (CLASSIFICATION).
  SUB-ENGINEERS (CLASSIFICATION).
  International Agricultural Institute, Rome.
  International Agricultural Institute, Rome.
  Tuberculous Persons (Treatment).
  Tuberculous Persons (Treatment).
  Tea Imported.
  Tea Imported.
  Exports (Manufactured Goods).
  Exports (Manufactured Goods).
  National and Local Expenditure.
  National and Local Expenditure.
  Imperial and Local Taxation.
  Imperial and Local Taxation.
  Minister of Commerce.
  Minister of Commerce.
  House of Commons (Payment of Members).
  House of Commons (Payment of Members).
  Mall Approach Bill (Select Committee).
  Mall Approach Bill (Select Committee).