Sitting of 28 June 1927

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 ease of the following Bills, 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:

Abersoch Water Bill [Lords].

Bedford Corporation Bill [Lords].

Coventry Corporation (Boundary Extension) Bill [Lords].

Sunderland Corporation Bill [Lords].

Hospital of St. Mary the Virgin (Newcastle-upon-Tyne) Bill [Lords].

Salford Corporation Bill [Lords].

Bills to be read a Second time.
Yorkshire Electric Power Bill [Lords],
Read the Third time, and passed, with Amendments.

ORAL ANSWERS TO QUESTIONS.

  CHINA (BRITISH FORCES).
  Mr. THURTLEasked the Secretary of State for War if he is aware that Class A reservists at present with the Shanghai Defence Force have been asked if they would have any objections to serve longer overseas than the period of 12 months they are under an obligation to serve; and, if so, will he state why this question has been put to them?
  The SECRETARY of STATE for WAR (Sir Laming Worthington-Evans): Inquiries have been made by the local military authorities whether any Section A reservists now in China would volunteer to remain in Army service there, should occasion arise. The object of these inquiries is to ascertain what reliefs will be required to take the place of the Section A reservists. The contract with the reservists will be carried out strictly, and no reservist will be retained in the service beyond the 12 months unless he has volunteered to so remain.
  Mr. THURTLE: When does the right hon. Gentleman hope to bring these Class A reservists home from Shanghai?
  Sir L. WORTHINGTON-EVANS: In time to give them their discharge within 12 months.
  Lieut.-Colonel Sir FREDERICK HALLasked the Secretary of State for War what is the total number of troops of all ranks now in China; what is the approximate daily cost of maintaining this force; and how many casualties there have been from wounds, sickness, or other causes up to the present time?
  Sir L. WORTHINGTON-EVANS: As regards the first part of the question, in addition to the normal establishment of three infantry battalions, there are at present stationed in China and Hong Kong 17 infantry battalions and one marine battalion, with ancillary troops. As regards the second part, I would refer my hon. and gallant Friend to the reply which I gave on 2nd May to the right hon. and gallant Member for Newcastle-under-Lyme. As regards the last part, one soldier has been killed, two officers and nine other ranks have been wounded, and nine other ranks have died as the result of illness or accidents. The average weekly number in hospital during the four weeks ended 17th June was 22 officers and 895 other ranks.
  Sir F. HALL: In reference to the reply of 2nd May, in which the right hon. Gentleman indicated that it was impossible to give the approximate cost, does that still hold good? Cannot he give some idea now of the cost of the troops out there?
  Sir L. WORTHINGTON-EVANS: I gave a figure of about £250,000 a month,

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  and that is as near as I can give it at the moment. That is in addition to the transport charges.
  Lieut.-Commander KENWORTHY: Is not this figure of 900 officers and men in hospital abnormally high?
  Sir L. WORTHINGTON-EVANS: No, unfortunately it is not. The medical authorities are quite satisfied with the figure, saying it is quite good.
  Lieut.-Commander KENWORTHYasked the Secretary of State for Air where the air units and machines and pilots that have been sent to China were drawn from; and whether steps are being taken, or have been taken, to replace them?
  The SECRETARY of STATE for AIR (Sir Samuel Hoare): As regards the first part of the question the Fleet Air Arm units were drawn from home waters and from the Mediterranean; No. 2 Squadron, Royal Air Force, from Manston; and additional Army co-operation observers from Farnborough. The answer to the second part of the question is in the negative.
  Lieut.-Commander KENWORTHY: In view of the long stay of the expeditionary force in China will not steps be taken to replace these units?
  Sir S. HOARE: It depends on the time which they are required to stay there. Obviously, that is a question which must be taken into account.
  Lieut.-Commander KENWORTHY: In the meantime, for example, are the Fleet to be deprived of specially trained pilots for Fleet purposes?
  Sir S. HOARE: No, Sir.
  Lieut.-Commander KENWORTHY: How are you going to replace them?
  Mr. THURTLE: Is the right hon. Gentleman aware that a reply given by the Secretary of State for War indicates that the Shanghai Force is likely to be kept there for at least 12 months?

  SCOTLAND.

    HOUSING, CLYDEBANK.
    Mr. KIRKWOODasked the Secretary of State for Scotland whether he is aware that, owing to the prolonged depression
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    in the shipbuilding industry, the town council of the Burgh of Clydebank has experienced great difficulty in raising loans for housing schemes, and of the overcrowding in Clydebank, and the necessity of expediting a building programme; that the local council has applied to the Board of Health to recommend the Public Works Loan Board to facilitate a loan; and what steps, if any, he has taken in the matter?
    The SECRETARY of STATE for SCOTLAND (Sir John Gilmour): I am aware that the local authority of the Burgh of Clydebank have experienced difficulty in raising loans for their housing schemes. The Scottish Board of Health have been in communication with the Treasury on the subject and the decision of that Department has now been communicated to the local authority.
    Mr. KIRKWOOD: Is the right hon. Gentleman aware that the Town Council of Clydebank, through municipal banks and otherwise, have done their best, and that it is by the policy adopted by the Government in further flooding the market with ships that Clydebank is in such a state at present? I want to know, owing to these special circumstances, if the Secretary of State would not facilitate a loan?
    Sir J. GILMOUR: A communication has been made to the burgh, and advice has been tendered to them on the subject. I think it advisable to await the result of this.
    Mr. COUPER: Is the right hon. Gentleman not aware that instead of prolonged depression in Clydebank, as suggested in the question, shipbuilding is very much better than it has been for many years past?

    YOUNG FARMERS' CLUBS.
    Major Sir ARCHIBALD SINCLAIRasked the Secretary of State for Scotland whether the inquiries of the Board of Agriculture for Scotland with regard to the Young Farmers' Club movement have been completed; and whether the question of official recognition and supervision of such clubs has yet been decided?
    Sir J. GILMOUR: The information obtained by the Board of Agriculture for Scotland shows that the Young Farmer

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    Club movement is progressing, though slowly. The staffs of the agricultural colleges are assisting wherever possible in the formation and the work of such clubs, and the Board will do what they can to support the movement.

    SMALL HOLDINGS.
    Sir A. SINCLAIRasked the Secretary of State for Scotland how soon the 74 holders who are in occupation of small holdings created since the present Government came into power, but who have not yet been registered with the Land Court, will obtain registration; and the average rent of the 43 holders who have been registered since the winter of 1924?
    Sir J. GILMOUR: Forty-eight of the 74 holders referred to have been registered by the Scottish Land Court since my reply to the hon. Member's question of 22nd February last. Applications for the registration of the remaining 26 holders are being prepared and are expected to be lodged with the Court next month. The answer to the last part of the question is £7 11s. 6d.
    Mr. SKELTON: Are we to take it that that figure is correct, that in the last three years only 74 smallholders have been established?
    Sir J. GILMOUR: Oh, no, Sir. Only for this particular season.
    Sir A. SINCLAIR: Does not this figure apply to all smallholdings established in the last three years, according to an answer which the right hon. Gentleman gave me a week or two ago?
    Sir J. GILMOUR: I am not quite clear on the point. I will look into it.

  SAFEGUARDING OF INDUSTRIES.

    GAS MANTLES.
    Mr. HARRISasked the President of the Board of Trade what was the total amount of imports of gas mantles in the first four months of 1925, 1926, and 1927, respectively?
    The PRESIDENT of the BOARD of TRADE (Sir Philip Cunliffe-Lister): The imports of gas mantles in the first four months of 1925, 1926, and 1927, respectively, were 67,656 gross, 14,958 gross, and 11,203 gross.
    Colonel DAY: Is that, higher or lower than the last period of the year?
    Sir P. CUNLIFFE-LISTER: I could not say without notice.
    Mr. HERBERT WILLIAMSasked the President of the Board of Trade whether he has any information as to the wholesale and retail prices of gas mantles before and after the imposition of the safeguarding duty?
    Sir P. CUNLIFFE-LISTER: I am informed that the average price realised by the members of the trade association on the sale by them of all their mantles during the year ended on 31st March last shows an increase of 1s. a gross on the average price realised by them during the preceding year. These sales are estimated to cover 85 per cent. of all the mantles sold in this country. Against this there have been increases in the cost of certain materials. The retail prices of the classes of mantles most commonly used have, so far as I can ascertain, remained substantially unchanged.
    Mr. WILLIAMS: May I take it that the statement recently made in the House that there has been a large increase in the price of mantles to the public is in fact inaccurate?
    Sir P. CUNLIFFE-LISTER: I think so. I have collected the information as carefully as I can in my Department and have passed on the information in the answer.
    Mr. RILEY: Who meets the extra cost of a shilling in the wholesale price?
    Sir P. CUNLIFFE-LISTER: It is a shilling a gross. If the price of an article goes up owing to the cost of the material having gone up, those who buy pay the extra cost.

    WOOLLEN TEXTILE AND IRON AND STEEL INDUSTRIES.
    Sir FRANK SANDERSONasked the President of the Board of Trade whether, in view of the continued depression in the woollen textile industry and the iron and steel industry, and the increased importation of these commodities, he will consider modifying the necessary procedure so as to facilitate and simplify the working of the Safeguarding of Industries Act?
    Sir P. CUNLIFFE-LISTER: I would refer my hon. Friend to the answer given by the Chancellor of the Exchequer to the hon. Member for the Cleveland Division (Sir Park Goff) on 12th April, a copy of which I am sending him.

  TRADE AND COMMERCE.

    POWER PRODUCTION.
    Mr. GEORGE HAULasked the President of the Board of Trade the percentage production of power produced in this country from coal, oil, gas, and water-power for the years 1910 to 1914 and 1922 to 1926, respectively?
    Sir P. CUNLIFFE-LISTER: I regret that the information desired by the hon. Member is not available.

    EXPORT PRICES (DUTIES).
    Sir JOHN POWERasked the President of the Board of Trade whether the prices at which the products of industry which are protected by tariffs are being exported have fallen or risen since the duties were imposed?
    Sir P. CUNLIFFE-LISTER: From inquiries which have been made it appears that in the trades protected by Safeguarding Duties there has, generally speaking, been either no change in export prices since the duty was imposed, or a slight reduction in those prices; and that in trades covered by the McKenna Duties a fall in export prices is still continuing.
    Mr. A. V. ALEXANDER: Did the prices in the home market remain in the same condition?
    Sir P. CUNLIFFE-LISTER: I should like notice of that question, but my recollection is that the answers I have previously given have shown that prices either remained stationary or have fallen.
    Lieut.-Commander KENWORTHY: Is there not a general reduction in price in all commodities whether protected or not?
    Sir P. CUNLIFFE-LISTER: I thought the hon. and gallant Gentleman's contention was that if you put on a duty of a third you raised the price.
    Sir J. POWER: Has not the policy of safeguarding actually helped the export trade?
    Sir P. CUNLIFFE-LISTER: In many cases the export trade has increased, as would lie expected if you have a larger output.
    Mr. HARRIS: The import prices quoted by the Board of Trade are without the duties on, are they not?
    Sir F. CUNLIFFE-LISTER: I understood the hon. Member's suggestion was that if you put on a duty it raised prices all round and enabled the home manufacturer to raise prices.
    Mr. ERNEST BROWN: Is the right hon. Gentleman not aware of the statement of the Chancellor of the Exchequer that where prices were not raised the duty probably anticipated a fall to the consumer?

    CRUDE PETROLEUM (PRODUCTION).
    Mr. JOHNasked the President of the Board of Trade whether he can give figures showing the world production of crude natural oil for the years 1910, 1915, 1920, and 1926?
    Sir P. CUNLIFFE-LISTER: The world production of crude petroleum is estimated to have been about 47 million tons in 1910, 62 million tons in 1915, 98 million tons in 1920, and 150 million tons in 1926.

    FRANCE (TARIFF BILL).
    Major COLFOX (for Colonel VAUGHAN-MORGAN)asked the President of the Board of Trade whether he can inform the House as to the present position of the new tariff proposals of the French Government?
    Sir P. CUNLIFFE-LISTER: The position remains as stated in the reply I gave to the hon. Member for Lincoln (Mr. Taylor) on 14th June. The Tariff Bill still awaits consideration by the Chamber of Deputies and is not, I understand, likely to be passed into law before the Summer Recess.

  COAL MINING INDUSTRY.

    OUTPUT.
    Sir J. POWERasked the Secretary for Mines how the output of coal per man-shift during the March quarter

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    of this year compares with that during the corresponding period last year?
    The SECRETARY for MINES (Colonel Lane Fox): From the information at present available it appears that the output of coal per man-shift worked was nearly 15 per cent. higher during the March quarter of this year than during the corresponding quarter of 1926.

    UPTON COLLIERY (ACCIDENT).
    Mr. LUNNasked the Secretary for Mines whether an inquiry has been held into the cause of the fatality at the Upton Colliery sinking pit; if he has received a report from His Majesty's inspector of mines; and whether he has given or will give instructions, to avoid similar fatalities in the future, that detonators shall be tested on the surface and not in the pit sump?
    Colonel LANE FOX: Yes, Sir; an inspector has investigated the cause of this accident, and I have received his report. It is already the practice to test detonators on the surface, if they are tested at all. The cause of this accident was rather different. The deceased man had charged a round of 21 shots, tested their electrical continuity, and found it defective. He located the fault in a particular shot, and was testing it singly, contrary to instructions, when it exploded and killed him. Arrangements have now been made by which circuits of charged shots are only tested from a safe distance.
    Mr. LUNN: What steps are being taken to deal with those responsible for this accident and the way this man was killed by not following the instructions laid clown by his Department but perhaps ignored by other people?
    Colonel LANE FOX: As I have said, the man was unfortunately acting contrary to instructions.

    UNDERGROUND HAULAGE.
    Mr. DAVID GRENFELLasked the Secretary for Mines the number of collieries where the underground haulage is done entirely by machinery, and the aggregate annual tonnage raised from these mines?
    Colonel LANE FOX: This information is not readily available, but I am
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    arranging to send the hon. Member such particulars as can be extracted from the information in my possession.

    NYSTAGMUS.
    Mr. D. GRENFELLasked the Secretary for Mines the figures showing how many men are disabled by nystagmus in mines where men work with oil lamps and with electric lamps, respectively?
    Colonel LANE FOX: I would refer the hon. Member to my reply of 15th March last to a similar question by the hon. Member for Doncaster (Mr. Paling).
    Colonel DAY: Is it a fact that no alteration in the conditions has taken place since the 15th March?
    Colonel LANE FOX: The reply I gave on the 15th March was certainly a sufficient reply.

    MEDICAL INSPECTOR.
    Mr. LEEasked the Secretary for Mines what are the reasons that prompted his Department to engage a medical man; whether, in the necessary qualification for the position, regard is being had to the ever-increasing spread of miners' nystagmus, and the varying theories held by medical men as to the causes of this disease and the remedies for it; and what will be the specific duties connected with the appointment?
    Colonel LANE FOX: The duties of the medical inspector will be to advise the present inspectorate on the health problems of the mining and quarrying industries, to assist in applying the health Regulations effectively and in improving them, and to ensure that, so far as practicable, the results of medical research are applied to mines and quarries. In making the appointment, due weight will be given to the considerations mentioned by the hon. Member
    Mr. LUNN: Has this appointment been made, and is the medical man a specialist in the particular disease mentioned in the question, which is increasing so rapidly and so dangerously in the mining industry?
    Colonel LANE FOX: Yes, Sir. With regard to the appointment, perhaps the hon. Member will put down a question.

    CANNOCK AND RIMELEY COLLIERIES (ACCIDENT).
    Mr. W. M. ADAMSONasked the Secretary for Mines whether he has noted the evidence given and the statement of the jury at the inquest on two miners who were killed in a winding-cage accident at the Cannock and Rugeley collieries, Wimblebury, recently; whether he is satisfied that adequate precautions were taken with the working of the new winding engine prior to the accident; and whether he will take steps to, have a full inquiry into the matter?
    Colonel LANE FOX: I have seen the evidence and the jury's statement, as well as a full report from the inspector who investigated this unfortunate accident. There is no doubt as to its cause; the winding engineman candidly admitted his mistake. Proper precautions were taken in installing the new engine, but I am inclined to agree with the jury's view that this engineman should have had more practice with it before winding men.
    Mr. ADAMSON: Will the right hon. and gallant Gentleman answer the last part of the question as to whether a further inquiry will be made with a view to avoiding such accidents where lack of practice is evidently the cause?
    Colonel LANE FOX: No, Sir; I think the inquiry by the inspector was sufficient. There was no doubt about the facts. They were admitted.
    Colonel DAY: Can the right hon. and gallant Gentleman say how many men were injured besides the two men who were killed?
    Colonel LANE FOX: The hon. Member had better put down a question. I cannot say exactly.
    Mr. ADAMSON: Was not the inquiry only with regard to the death of the two men and as to how the accident happened, and not as to who might be responsible?
    Colonel LANE FOX: No, Sir. I think the whole thing was gone into, and the cause of the accident to the two men who were killed would equally be the cause of the accident to the others.
    Mr. ADAMSON: Is not the management responsible for putting on an engine a winder who has not had actual practice?
    Colonel LANE FOX: Yes, Sir. I quite agree that it was unfortunate that the man had not had more practice, but he was not forced to do anything. It was at his own option that he took this risk, as he had had a good many preliminary windings of coal only and felt himself fully competent to do the work of winding men.
    Mr. KIRKWOOD: I would like to ask the Secretary for Mines if he does not think that here is something which has to do with these accidents. I have four pay leaves which came up on Saturday from Kirkaldy and Dumfriesshire. The first pay leaf is 4d. for a week, a 1d. for a week, 14s. 10d. for a week, after all the deductions are taken off, and 13s. 7d. Is not that the reason why there are accidents in the mines—because the miners are being starved to death?

    AGED EMPLOYéS.
    Mr. D. GRENFELL (for Mr. C. EDWARDS)asked the Secretary for Mines if he will give the number of persons engaged in the mining industry for each complete month of this year and the number of men over 60 years of age at present engaged in the industry?
    Colonel LANE FOX: The total numbers of wage-earners employed at the end of each month of the present year were as follows: January, 996,100; February, 1,012,700; March, 1,026,200; April 1,028,700; and May, 1,025,700. With regard to the latter part of the question, the latest information is that obtained from the Decennial Census of Population of 1921, when 5·9 per cent. of the men employed in the coal mining industry were over 60 years of age.
    Mr. GRENFELL: Is it not possible to obtain from the collieries the number of men over 60 years of age employed?
    Colonel LANE FOX: Yes, Sir, it would be possible, but it would mean communicating with every individual undertaking, and that would involve a tremendous amount of work, and I doubt whether the result would be worth it.
    Mr. CECIL WILSON: Is not that information being completed now by the Ministry of Labour?
    Colonel LANE FOX: That question should be addressed to the Minister of Labour.

  TRANSPORT.

    TRAFFIC REGULATIONS (STATIONARY TRAMCARS).
    Colonel DAYasked the Minister of Transport if, in view of the danger to pedestrians alighting from or entering tramcars at stopping places within the County of London, he will consider the introduction of legislation to compel motorists and other moving vehicles to stop when tramcars are stationary, so as to allow persons to enter or leave tramcars freely?
    The MINISTER of TRANSPORT (Colonel Ashley): I am not satisfied that such legislation, which has been repeatedly refused by Parliament, is necessary or desirable either in the interests of public safety or of traffic by road. In my opinion the existing law with regard to dangerous driving is adequate to deal with the matter, and as the hon. Member is aware I have put forward proposals in the Draft Road Traffic Bill providing for increased penalties in cases where the circumstances seem to call for them.
    Colonel DAY: Does the draft Traffic Bill cover the point in my question, and will provision be made for it?
    Colonel ASHLEY: It would enable me to make regulations to deal with the matter.
    Mr. B. SMITH: Is the right hon. and gallant Gentleman aware that this system is followed in Canada and in the United States of America much to the disadvantage of the pedestrian and the road user?
    Colonel ASHLEY: That is the reason why I gave the answer in the sense that I did give it.
    Mr. THURTLE: Is the right hon. and gallant Gentleman aware that if he dealt with this question from the point of view of the pedestrian and not from the point of view of the motorist, he would take an entirely different point of view?
    Mr. SPEAKER: That is a matter of argument.

    UNCLASSIFIED ROADS ( GRANTS).
    Mr. H. WILLIAMSasked the Minister of Transport the amount of the grant from the Road Fund in aid of
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    rural roads during the year ended 31st March, 1925, and during the year ended 31st March, 1927, together with the estimated amount for the current year?
    Colonel ASHLEY: If, as I assume, my hon. Friend has in mind the special assistance given towards the maintenance of unclassified roads in rural areas, the answer to his question is that no allocation for this purpose was made from the Road Fund prior to last year, and that in each of the years 1926–27 and 1927–28 a sum of £1,400,000 has been provided.

    TELEPHONE AND TELEGRAPH POLES (ACCIDENTS).
    Sir DOUGLAS NEWTONasked the Minister of Transport how many fatal and other accidents to road travellers have been caused during the past two years by collisions with telephone and telegraph poles erected alongside public highways?
    Colonel ASHLEY: No statistics are available which would enable me to give my hon. Friend the information for which he asks.
    Sir D. NEWTON: Is my right hon. and gallant Friend aware that a great many accidents have occurred from this cause, and will he be prepared to make representation to the Post Office authorities that they should fix these posts on the inside rather than on the outside of the fences.
    Colonel ASHLEY: I know there are a certain number of accidents which do occur. In North Wales I saw several cases where the local authorities, with the concurrence of the owners of the land on each side, and the Post Office, had moved the telephone posts from the pathway between the road way and the fence and placed them inside the fence, and this minimises the chance of accidents.
    Mr. SHEPHERD: Cannot the right hon. and gallant Gentleman extend the system of putting white paint or white strips on telegraph poles which are situated on the side of the road?
    Colonel ASHLEY: I will consider that, but I think it is the presence of the posts rather than their visibility.

    CANALS.
    Captain GARRO-JONES (for Sir ROBERT THOMAS)asked the Minister

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    of Transport if he is prepared to devote renewed consideration to the question of canals, and especially to the reconditioning of those now derelict, with a view to cheapening the transport of bulky commodities and providing employment on a large scale?
    Colonel ASHLEY: All forms of transport including transport by canal are continually under my consideration, but I do not propose at the present time to institute any further formal inquiry, either into the question of canals generally or into the question of reconditioning derelict canals.

  POST OFFICE.

    HORSES AND MOTOR VEHICLES.
    Major GLYNasked the Postmaster-General the numbers of horses and motors, respectively, used in the Metropolitan area by the General Post Office or by the contractor to the General Post Office; and how do these figures compare with 1922 and 1913?
    The POSTMASTER-GENERAL (Sir William Mitchell-Thomson): The numbers of horses, horsed vans and motor vehicles employed on mail conveyance work in the London Postal area in 1913, 1922 and at the present time are as follow:

    1913.

    1922.

    1927.

    Horses

    …

    1,369

    1,151

    771

    Horsed vans

    …

    798

    569

    403

    Motor vehicles

    …

    156

    74

    384

    Colonel DAY: Is it not a fact that motor vehicles are very much more efficient, and does he consider that in the future motor vehicles for this service will be increased?
    Sir W. MITCHELL-THOMSON: I would not go so far as to say that. It is our experience, that under certain conditions, horses are more economical than motors.
    Captain CROOKSHANK: Is it the policy of the Post Office to employ only British motors for the service?
    Mr. MARCH: They are nearly all Fords.
    Sir W. MITCHELL-THOMSON: Practically all the motors employed are motors which are made in this country.
    Mr. SHEPHERD: Can we be assured that they are British horses too?

    TELEGRAPH AND TELEPHONE SERVICES (ADMINISTRATION).
    Major GLYNasked the Postmaster-General to what extent the administrative and operating staffs for the maintenance and extension of the telephone system are also concerned with the telegraph system; and how far are the two services, telegraphs and telephones, kept distinct as regards contracts for cable burying and maintenance of air lines?
    Sir W. MITCHELL-THOMSON: Speaking generally, there are separate operating and supervising staffs for the two services, the main exceptions being at small post offices where this would be wasteful. A joint staff deals with engineering construction, maintenance and contract matters save where economy and other benefits are to be gained by separation. Higher control and questions of policy are in the hands of a unified administrative personnel organised in a manner to secure such advantages as follow from specialisation.
    Major GLYN: Is it the intention of the right hon. Gentleman to let out on contract the setting up of air lines, as is done in regard to underground cables?
    Sir W. MITCHELL-THOMSON: I shall require notice of that question.

    LONDON RAILWAY.
    Major GLYNasked the Postmaster-General what are the anticipated annual savings that will result from the conveyance of parcels, etc., by the Post Office (London) railway when in normal operation; which are the railway termini that will be directly connected with the General Post Office; and to what extent will it be possible to do away with the existing method of conveyance of postal matter by horse and motor vehicles?
    Sir W. MITCHELL-THOMSON: It is anticipated that there will be an annual reduction of approximately £40,000 in the cost of the conveyance of letter and parcel mails by road when the Post Office (London) railway is fully working. The railway termini, which will be directly connected with the General Post Office, are Paddington Station (Great Western Railway) and Liverpool Street Station

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    (London and North-Eastern Railway). It may be estimated that the railway will relieve road mail services to the extent of approximately 400,000 miles annually or 27 per cent.
    Major COLFOX: Can my right hon. Friend give us the capital cost of this railway?
    Sir W. MITCHELL-THOMSON: I could give it in reply to a question.
    Sir F. HALL: When does my right hon. Friend think it will be in complete working?
    Sir W. MITCHELL-THOMSON: I think in a couple of months time.
    Commander BELLAIRS: Can my right hon. Friend say how long this Post Office (London) railway has been building?
    Sir W. MITCHELL-THOMSON: Many years.

    AUTOMATIC TELEPHONES.
    Mr. FENBYasked the Postmaster-General if, in view of the time and trouble saved to business and other people by the installation of automatic telephones, he will give the following particulars: what automatic telephone exchanges are now actually in operation; what exchanges will go over to automatic telephones this year; what exchanges will go over to automatic telephones next year; and how many exchanges in all have now been scheduled for future alteration over to the automatic method?
    Sir W. MITCHELL-THOMSON: The total number of automatic telephone exchanges already working is 69, comprising nearly 90,000 subscribers' lines. It is hoped to open 34 additional exchanges by the end of this year, about 40 more during 1928 and upwards of 200 more are already scheduled for conversion to automatic working in succeeding years.
    Colonel DAY: Can the right hon. Gentleman give us the difference in the figures as between the provinces and the Metropolitan area?
    Sir W. MITCHELL-THOMSON: There are no automatic exchanges working in the Metropolitan area.

    TRANS-ATLANTIC TELEPHONE SERVICE (CANADA).
    Colonel MORDENasked the Postmaster-General why it is that telephone connection has been made between this country and practically all parts of the United States of America, and yet no provision has been made for such connection with the Dominion of Canada?
    Sir W. MITCHELL-THOMSON: The question of extending the trans-Atlantic telephone service to Canada is under discussion between the Imperial and Canadian Governments.

    WIRELESS TELEPHONY (TRAWLERS).
    Mr. GROTRIANasked the Postmaster-General whether, in view of the advantage to the fishing fleet, it is permissible for private individuals to establish a wireless telephone service with the trawlers and other vessels with which they are connected; and whether he will define the general attitude of the Post Office towards initiative of this nature which is not met by any existing State service?
    Sir W. MITCHELL-THOMSON: In view of the risk of interference it is not practicable to permit the establishment of private wireless stations for communication with ships at sea. Vessels fitted with wireless telegraph apparatus can send and receive raessages through any of the Post Office coast stations; and in order to meet the needs of a number of trawlers which have recently been fitted with wireless telephone apparatus, arrangements are being made to equip the new coast station now in course of construction at Mablethorpe with suitable apparatus for the exchange of messages with those vessels by wireless telephony.

    STOLEN LETTERS AND PACKETS.
    Mr. R. MORRISONasked the Postmaster-General if he is aware of several recent cases in which letters and postal packets have not been delivered, and proof has afterwards been given to his Department that they have been stolen; and will he consider modifying the regulations in order that compensation may be payable in those cases in which proof is forthcoming that unregistered letters and packets have been stolen by Post Office employés?
    Sir W. MITCHELL-THOMSON: The answer to the first part of the hon.

    201
    Member's question is in the affirmative. In view of the facilities provided for the registration of postal packets, I am not prepared to modify the existing regulation which precludes the payment of compensation in respect of unregistered letter packets.
    Mr. MORRISON: Does the right hon. Gentleman know any other business that would repudiate responsibility for the loss of packets entrusted to their care when it was proved that the packets were lost by the employés of the firm?
    Sir W. MITCHELL-THOMSON: As I have said, facilities for registering letters exist, and are well known.
    Mr. MORRISON: Surely the right hon. Gentleman will realise that this is an exception and deals with the case of letters entrusted to the Post Office which have been stolen by employés of the Post Office. Surely the Post Office is responsible in that case, whether the letters are registered or not?

    AUXILIARY POSTMEN.
    Mr. R. MORRISONasked the Postmaster-General if his attention has been called to the case of an auxiliary postman who was charged at Tottenham Police Court on the 8th instant with stealing postal orders, and to the evidence given by a Post Office official that the man's weekly wages were £1 14s. 3d., less deductions; and will he take steps to enable auxiliary postmen to work sufficient hours to earn a living wage?
    Sir W. MITCHELL-THOMSON: I am aware of the alleged facts of the case and the man is now awaiting trial. As regards the question of increasing the attendances of auxiliary postmen, I would refer the hon. Member to the answer on this point which I gave him on the 15th of March.
    Mr. MORRISON: Cannot the Postmaster-General make a special effort to do away with this wretched system, which is bringing these auxiliary postmen into Courts every week charged with theft because they are not able to earn a living wage?
    Sir W. MITCHELL-THOMSON: I have said more than once that it is extremely difficult to devise any other
    202
    system which would give us the results we require.

    TELEPHONE DEVELOPMENT.
    Lieut.-Commander KENWORTHYasked the Postmaster-General what will have been the approximate capital expenditure this year on new telephone development; and what was the corresponding capital sum in 1926 and 1925?
    W. MITCHELL-THOMSON: The estimated expenditure on the development of the telephone system for the current financial year (1927–28) is about £12,000,000. The figures for 1926–27 and 1925–26 were £10,611,000 and £11,902,000, respectively. The expenditure in 1926–27 would have been greater but for the coal stoppage.

    TELEPHONE SERVICE (ADVERTISING AND CANVASSING).
    Sir HARRY BRITTAINasked the Postmaster-General what proportion of the Post Office revenue from telephones is devoted to advertising the service; and where such expenditure is shown?
    Sir W. MITCHELL-THOMSON: A considerable amount of advertisement is carried out by means of posters, leaflets, booklets, etc., but no definite proportion of telephone revenue is allocated to this form of publicity. New business is sought mainly by personal canvassing because it is regarded as the most suitable and most remunerative method. The expenses of the canvassing staff are borne on the Post Office Vote and those of printing upon the Vote for the Stationery Office.
    Sir H. BRITTAIN: Is the right hon. Gentleman considering the advisability of putting this matter into the hands of one of the leading firms who specialise in this important side of business?
    Sir W. MITCHELL-THOMSON: I do not apprehend exactly what the hon. Member suggests. If he means printing publicity, the answer is that I am satisfied that we do better by personal canvass. If it is personal canvass, then I prefer it to be under the control of the Post Office.
    Sir JOSEPH NALL: Would not the best advertisement of the telephones be a quicker installation and a more busi-

    203
    nesslike administration in the contract department?
    Sir. W. MITCHELL-THOMSON: I think the average lag in the installation of the telephone is something within a fortnight or three weeks.
    Sir J. NALL: Will the right hon. Gentleman look into the case on which I gave him some information, in which six months elapsed before the telephone was installed?
    Mr. H. WILLIAMS: Do not the canvassers waste a good deal of time when a simple letter would furnish all the information that is desired?
    Mr. RILEY: Do canvassers perform other duties besides that of canvassing?
    Sir W. MITCHELL-THOMSON: That is dealt with in another question.
    Mr. MONTAGUE: Does not the right hon. Gentleman think that the employment of an efficient publicity man would be as good for the advertisement of telephones as the employment of a publicity man is for advertising the Empire Marketing Board.
    Mr. SPEAKER: These matters can be argued on the Estimates.
    Sir H. BRITTAINasked the Postmaster-General what is the average cost to the Department of each new subscriber obtained by the employment of a canvassing staff?
    Sir W. MITCHELL-THOMSON: The canvassing staff forms part only of a larger staff employed upon a number of duties, in addition to actual canvassing, including work in connection with removals, cessations, transfers and collection of material for estimating future growth. I regret that it is impracticable to separate the expenditure so as to furnish the information required.
    Sir H. BRITTAIN: Does not the right hon. Gentleman recollect that only last week he gave me the number of canvassers, which is amazingly small for the whole country? He now states that they have other duties to perform. I should like to ask whether they are paid by results.
    Sir W. MITCHELL-THOMSON: The hon. Member has not heard the answer properly. The canvassers are only part of a larger staff, which deals with various duties. It is extremely difficult to separate the actual payments made to these canvassers from the other payments.
    Sir H. BRITTAIN: I really did hear the answer, and I should like to know whether this comparatively small staff is paid by results?
    Sir W. MITCHELL-THOMSON: If the hon. Member will put down a question on that precise point, I will give him an answer.
    Captain GARRO-JONES(for Sir R. THOMAS) asked the Postmaster-General whether he is aware that many of the facilities that are available to telephone subscribers are almost unknown to the public because they are not advertised; and whether he, will have a simply-worded booklet prepared drawing attention to these facilities?
    Sir W. MITCHELL-THOMSON: The Post Office has issued a large number of leaflets and booklets drawing special attention to the facilities available, and these have been widely distributed. Full particulars are, of course, also given in the Telephone Directory and in the Post Office Guide. The question of issuing further publicity literature is constantly under review.
    Colonel DAY: Will the right hon. Gentleman consider the question of putting these leaflets and booklets in the post offices so that the public can pick them up, as they do leaflets in banks?
    Sir W. MITCHELL-THOMSON: I fancy that in some respects that is done already, but I will consider the matter.

    EX-SERVICE MEN (HEIGHT REGULATIONS).
    Sir A. SINCLAIRasked the Postmaster-General whether he can see his way to waive the Regulation that permanent postmen must be at least five feet four inches in height in the case of men who served in the Navy, Army, or Air Force, during the War?
    Sir W. MITCHELL-THOMSON: The answer is in the negative.
    The minimum height limit for the appointment of candidates as postmen is

    205
    fixed at five feet four inches, on account of the nature of the work which they are liable to perform. Sorting normally forms part of a postman's duties, and a man below the minimum height would experience difficulty in reaching the upper parts of the sorting frames. The number of ex-service candidates who satisfy the requirements of the Regulations is greatly in excess of the number of places available, and a candidate below the minimum height could only be accepted at the expense of a candidate who complies with the Regulations.
    Sir A. SINCLAIR: What justification can there be for regarding able-bodied ex-service men as physically unfit to perform the duties of postmen? If it is a matter of height and of reaching the sorting frame could not a box be provided on which the man could stand?
    Lieut. - Colonel ACLAND - TROYTE: Does the right hon. Gentleman consider that a man who is fit to carry a pack in France is unable to carry a package of letters here?
    Sir W. MITCHELL-THOMSON: It is not a question of physical fitness, it is a question of the actual physical height. The particular man whose case was brought to my attention was ineligible on other grounds, not having a sufficient length of service.
    Mr. E. BROWN: Does the right hon. Gentleman not consider that this Regulation does a great injustice to one of the best battalions which served during the War, the Bantams Battalion?
    Major COLFOX: Can the right hon. Gentleman give us any idea of whether many of these men are disqualified?
    Sir W. MITCHELL-THOMSON: There are a considerable number of applicants, but we have a very large number of applicants who are of suitable height, and it would be an injustice to them, and I am not prepared to abandon the Regulation.
    Mr. HURD: Are those applicants also ex-service men?
    Sir W. MITCHELL-THOMSON: Yes, all ex-service men.
    Mr. R. MORRISON: Can the right hon. Gentleman say whether there is a maximum height?
    Mr. MACPHERSON: Is the right hon. Gentleman not aware that the same objections which he is advancing now against the employment of men of that height were advanced by the War Office at the beginning of the War and is he further aware that no battalion covered itself with greater distinction than the Bantams Battalion?
    Mr. DUFF COOPER: Is it not a fact that under this Regulation Bonaparte would have been ineligible to be a postman?

    DELIVERIES, LLANBADARN-FYNYDD, MODRYDD AND GLYNN.
    Captain ARTHUR EVANS(for Captain D'ARCY HALL) asked the Postmaster-General whether his attention has been called to the fact that at certain houses in the Llanbadarn-Fynydd, Modrydd, and Glynn districts there is only a delivery of letters on three days a week; if he will state for each district what would be the additional annual cost of providing a daily delivery for all the inhabitants; and if he will cause the position to be reviewed at once with a view to the institution of a daily delivery?
    Sir W. MITCHELL-THOMSON:I have received representations on the matter. The additional cost of giving a daily delivery would be about £20 a year in the Llanbadarn Fynydd district and about £35 a year in the Modrydd and Glynn districts. The number of letters for the places concerned is quite insufficient to justify this increased expenditure.
    Captain EVANS: Could the right hon. Gentleman give me the number of letters?
    Sir W. MITCHELL-THOMSON: About 85 letters a week in the Llanbadarn-Fynydd district.

  NAVAL AND MILITARY PENSIONS AND GRANTS.

    PENSIONERS (LEITH).
    Mr. E. BROWNasked the Minister of Pensions the number of ex-service men in receipt of pensions in the port of Leith; and what is the average weekly sum paid to them?
    The PARLIAMENTARY SECRETARY to the MINISTRY of PENSIONS (Lieut.-Colonel Stanley): I regret that the records of the Department are not kept in a form which would enable this information to be given for particular towns.

    COMMUTATION.
    Mr. SHEPHERDasked the Financial Secretary to the Treasury, seeing that one of the strict conditions governing the grant of commutation is that the pensioner must be certified to possess a normal expectation of life, why a pensioner aged 35 receives less than 14 years' purchase of the amount commuted while the normal expectation of life at that age is over 31 years?
    The FINANCIAL SECRETARY to the TREASURY (Mr. Ronald McNeill): I think the hon. Member is overlooking the question of date of payment. If a pensioner commutes, he receives cash down now; if he does not commute but lives to a normal age, he may receive a larger sum but only in instalments spread over a very long period. It would obviously be impossible to pay a pensioner £100 present value now in respect of a claim he may have to receive £100 in 10, 20 or 30 years' time.
    Mr. SHEPHERDasked the Minister of Pensions if he has received representations from the Darlington, Auckland and District Area War Pensions Committee and other area committees protesting against the manner in which a man is informed that he cannot commute part of his pension because he cannot be certified to possess a normal expectation of life; whether he is aware that in certain cases the receipt of the notice has had a detrimental effect upon the pensioner; and if it is proposed to amend the formal answer sent to applicants in cases where commutation is refused owing to the state of health of the pensioner?
    Lieut.-Colonel STANLEY: My right hon. Friend has received representations from the committee referred to, and has fully explained to them the reasons governing the Ministry's practice. Resolutions supporting the representations of the Darlington Committee have since been received from two other committees. My right hon. Friend has most carefully considered this question, but while greatly
    208
    regretting any distress which may be caused by an official communication of this nature, he does not consider it possible to refuse to explain to a pensioner the reasons laid down by the published statutory Regulations for rejecting an application for commutation which the pensioner is entitled to make, and after careful and sympathetic consideration, he has come to the conclusion that it is less likely to cause distress if the reason is given at the outset than if it is disclosed only under pressure.
    Mr. SHEPHERD: Does not the right hon. and gallant Gentleman consider that to give the reply of the Ministry to the local committee and allow them to pass it on verbally and personally to the pensioner, would be a less brutal method than the one now adopted of sending a form.
    Lieut.-Colonel STANLEY: I do not think it would be. In the first place, it would inform all the other people of the particular state of the man's health, and, I am not sure whether we have any right whatever to inform other people of the state of the man's health.
    Mr. SHEPHERD: May I press this matter. Will the right hon. and gallant Gentleman consider the possibility of someone on the War Pensions Committee who is a friend of the pensioner giving the information to the man first. There are many cases where a man has been seriously affected by receiving a blunt, formal notification.
    Lieut.-Colonel STANLEY: This matter was considered long before it was raised by the Darlington War Pensions Committee and consideration was given to the question of whether there was any better way of dealing with it. After very sympathetic consideration, it was decided that this way was better than being forced to give information to the man which might have a worse effect upon him.

    NEED PENSIONS.
    Mr. W. BAKERasked the Minister of Pensions whether with regard to contributions in the case of surviving sons who are unable owing to poverty to contribute toward the support of parents who are in receipt of need pensions, he is aware that his Department regularly refuses to regard unemployment as a

    209
    reason for waiving such contributions; and whether, having regard to the many hard cases in which a potential contributor is unemployed and is without financial means or any immediate prospect of securing work, he will cause the official decision in such cases to be reviewed?
    Lieut.-Colonel STANLEY: I do not think that I can add anything to the answer on this point which my right hon. Friend gave to the hon. Member on the 16th instant, of which I am sending him a copy.
    Mr. BAKER: May I ask if the Ministry of Pensions will give very careful consideration to this request, on the ground that it is unsatisfactory that people should be held liable to contribute to the family income when they are unemployed and have no chance of getting work.
    Lieut.-Colonel STANLEY: That, of course, has been taken into consideration, but the hon. Member seems to forget that the sum given in respect of a deceased son is a fixed sum and remains constant, and the deceased son might not have been able to contribute.

    BANK OF ENGLAND (GOLD EXPORTS).
    Mr. GILLETTasked the Chancellor of the Exchequer whether, in view of the recent purchase of gold from the Bank of England by the French Government, any representations have been made to that Government pointing out the prejudicial effect on the trade of this country and the increased cost to the Government in the issue of Treasury Bills as the result of this action; and, if so, what answer has been received?
    Mr. R. Mc NEILL: I would refer the hon. Member to the statement which my right hon. Friend made on this matter in the course of the Debate yesterday.

    NEWFOUNDLAND (CORNERBROOK TIMBER SALE).
    Viscount SANDONasked the Chancellor of the Exchequer whether he has received a communication from the Government of Newfoundland on the subject of the possible sale of the Cornerbrook
    210
    timber and pulp concern to a big combine operating in the United States; and, if so, whether he will, in stating the attitude of the home Government as joint guarantors under the Trade Facilities Act, give full weight to the undesirability of allowing so large a proportion of the colony's assets to pass into non-British hands?
    Mr. Mc NEILL: I understand that my right hon. Friend the Secretary of State for Dominion Affairs has received a communication from the Newfoundland Government on the subject of the negotiations now proceeding as to the possible sale of the property in question. It is not possible to make any statement at present with reference to these negotiations, but my Noble Friend may rest assured that all relevant considerations will be borne in mind.
    Mr. CONNOLLY: May I ask whether the Government have been called upon to meet any of the loss under the Trade Guarantee, and, alternatively, if the sale is not completed, will they be called upon to do so?
    Mr. Mc NEILL: I cannot say that at present. Negotiations are proceeding, and it will be premature to make any statement.

    INCOME TAX AND SUPER-TAX.
    Mr. H. WILLIAMSasked the Chancellor of the Exchequer if he can furnish an estimate of the reduction in Income Tax payable under Schedule B as a result of the rate of the reduction in Income Tax and the modification in the earned income allowance under the Finance Act of 1925?
    Mr. Mc NEILL: I regret that under the present system of graduation and differentiation of the Income Tax the total yield of the tax cannot be divided between the respective schedules. The information asked for by my hon. Friend is therefore not available.
    Sir FRANK NELSONasked the Chancellor of the Exchequer the cost per head of the Income Tax and Super-tax paying population of the estimated Budget expenditure for 1927–28?
    Mr. Mc NEILL: The number of individuals who pay and bear Income Tax may be taken as about 2,300,000, and the

    211
    number of Super-tax payers included in this total as 97,000. If the Budget expenditure of £833,390,000 were entirely defrayed by those taxpayers it would be equivalent to £362 per head of Income Tax payers or £8,590 per head of Super-tax payers. But in fact the yield of Income and Super-tax is estimated at £309,000,000, not at £833,000,000.
    Major BRAITHWAITEasked the Chancellor of the Exchequer the number of farmers assessed for Income Tax; the percentage who actually pay Income Tax; and how many farmers who had previously paid Income Tax did not do so during the last taxable period?
    Mr. Mc NEILL: I regret that I am unable to give the information required. My hon. and gallant Friend will find the latest particulars of Income Tax, Schedule B, Assessments on Farmers, in the table on page 86 of the 69th Report of the Commissioners of Inland Revenue (Command Paper 2783).

    CUSTOMS AND EXCISE DEPARTMENT.
    Lieut.-Commander KENWORTHYasked the Financial Secretary to the Treasury the number of Customs officers and other persons employed in His Majesty's Customs service at the present date or nearest convenient date, and the corresponding number for the same or a near date in 1924?
    Mr. Mc NEILL: The total staff employed in the Customs and Excise Department was 11,273 on 1st April, 1924, and 11,795 on 1st April, 1927.

  AGRICULTURE.

    CREDITS.
    Major BRAITHWAITEasked the Minister of Agriculture when he will be in a position to put before the House the proposals for long and short-term credits for farmers?
    The MINISTER of AGRICULTURE (Mr. Guinness): I would refer my hon. and gallant Friend to the answer given on the 16th of May in reply to a similar question from my hon. and gallant Friend the Member for the Maldon Division of Essex (Lieut.-Colonel Ruggles-Brise), a copy of which I am sending to him.
    Major BRAITHWAITE: Is the right hon. Gentleman aware that owing to the serious newspaper controversy which is going on at present the banks have shortened credits to farmers, thus causing serious embarrassment to the industry in general?
    Mr. GUINNESS: I have had that trouble brought to my notice.
    Mr. AUSTIN HOPKINSON: Have the Government any scheme for putting an end to this poisonous campaign?
    Major COLFOX: Has any progress been made since 16th May?
    Mr. GUINNESS: The matter is being pursued, and, as soon as we think a statement can usefully be made, I shall make it.
    Mr. JOHNSTON: Will precautions be taken by the Minister to see that whatever short- or long-term credits are given for the benefit of apiculture, they shall not go in increased rents to the landlords?
    Mr. GUINNESS: It is not a question of the State giving any credits. It is a question of the State mobilising credit and bringing the lender and the borrower together.
    Mr. RILEY: Are we to understand that, whatever steps are taken, the credits will be available for smallholders as well as large farmers?
    Mr. GUINNESS: The hon. Gentleman had better await the details of the scheme.

    CORN (YIELD AND PRICES).
    Major BRAITHWAITEasked the Minister of Agriculture the total yield last year of oats, barley, and wheat; the average prices received as compared with prices of imported corn; and the total amount of money received by the farmers for these crops?
    Mr. GUINNESS: With my hon. and Gallant Friend's permission I will circulate in the OFFICIAL REPORT a statement giving the desired information.
    Following is the statement:
    The total production of wheat, barley and oats in England and Wales in 1926, together with average prices of homegrown, the declared value of imported

    213
    grain, and the estimated amount received by farmers in England and Wales for the

    —

    Production in England and Wales in 1926.

    Average prices per cwt. of home- grown grain in England and Wales, Sept., 1926, to May 1927.

    Average declared value per cwt. of grain imported into Great Britain and Northern Ireland, Sept., 1926, to May, 1927.

    Estimated amount received by farmers in England and Wales for quantities sold off farms (see note).

    Tons.

    s.

    d.

    s.

    d.

    £

    Wheat

    …

    …

    1,304,000

    11

    9

    12

    7

    11,490,000

    Barley

    …

    …

    916,000

    11

    3

    9

    3

    6,690,000

    Oats

    …

    …

    1,490,000

    8

    4

    7

    8

    3,100,000

    NOTE.—It is estimated that on the average 75 per cent. of the wheat, 65 per cent. of the barley and 25 per cent. of the oats produced in England and Wales are sold off the farms.

    ENGLISH BEET SUGAR CORPORATION, LIMITED (SUBSIDY).
    Mr. THURTLEasked the Minister of Agriculture how much subsidy has been paid to the English Beet Sugar Corporation in the last two financial years?
    Mr. GUINNESS: The amount of subsidy paid to the English Beet Sugar Corporation, Limited, in respect of the operations of the Cantley factory was: 1925–26, £360,872 13s. 10d.; 1926–27, £505,251 Is. 5d.; and in respect of the Kelham factory, which is the property of Home Grown Sugar, Limited, but worked by the English Beet Sugar Corporation in the joint interest: 1925–26, £103,537 0s. 0d.; 1926–27, £270,127 11 s. 4d. Approximately one-third of these sums were recovered by the State in the form of Excise Duty.
    Mr. THURTLE: Is the right hon. Gentleman aware that this company made in trading profit last year over two-thirds of its issued capital and has paid a 20 per cent. dividend tax free, and has two-thirds of its capital already reserved; and does he think that the state of the Exchequer is such as to enable him to make such lavish payments to capitalism?
    Mr. GUINNESS: In view of the difficulties which certain companies had in raising money, I do not think that any lower terms would have attained the object.

    INDIA (RESERVE BANK SCHEME).
    Mr. GILLETTasked the Under-Secretary of State for India whether, in view of the fact that the Committee which
    quantities of these crops sold off farms were as follows:
    has been considering the Reserve Bank Bill has rejected the proposals for a reserve bank with a share capital, it is proposed to establish a State bank without share capital?
    The UNDER-SECRETARY of STATE for INDIA (Earl Winterton): The Committee which has been sitting in Bombay is to resume its deliberations in Calcutta. I am not yet in a position to make any statement regarding any modifications in the scheme for the Reserve Bank that the Committee may propose.

    PARLIAMENTARY FRANCHISE.
    Mr. E. BROWNasked the Secretary of State for the Home Department whether the Government are considering any alteration in the system of electing Members to this House; and, if so, whether a Bill will be introduced during this Session?
    The UNDER-SECRETARY of STATE for HOME AFFAIRS (Captain Hacking): I would refer the hon. Member to the reply given by the Prime Minister on the 10th March to a question put by the hon. Member for North Lambeth (Mr. Briant).
    Mr. BROWN: Is the hon. and gallant Gentleman aware that in the six by-elections held this Session, in popular constituencies, no Member has been returned by a majority vote; and does he not think it more important to get majority representation in this House, than to obtain arbitrary powers for a minority number of hereditary Peers in the other House?

  RUSSIA.

    ARCOS, LIMITED (POLICE SEARCH).
    Sir F. HALLasked the Secretary of State for Foreign Affairs whether the information obtained as the result of the examination of the papers found at the Arcos offices of the Russian Trading Delegation, showing the extent to which the Soviet diplomatic and trading representatives in this and other countries have used their diplomatic privileges to create trouble, has been communicated to the Governments of the countries concerned?
    The UNDER-SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Godfrey Locker-Lampson): Yes, Sir. Such information as was discovered during the search at Soviet House relating to Russian interference in domestic affairs in foreign countries has been communicated to the Governments of the countries concerned.

    SOVIET CRIMINAL CODE.
    Sir F. HALLasked the Secretary of State for Foreign Affairs whether he is aware that the Soviet Code permits the putting to death of people in Russia without trial on the order of the police; if he can state how many British subjects have been dealt with under this Code; and whether he will take steps to warn persons desiring passports to enable them to proceed to Russia of the judicial system that is in vogue there, as now officially described?
    Mr. LOCKER-LAMPSON: The Soviet Criminal Code lays down that punishment is to be determined by the judicial bodies in accordance with their socialistic conception of law, but it is notorious that persons are put to death without what would be termed trial in this country. I am not aware of more than one British subject, Mr. Davison, who has suffered the death penalty and, according to the Soviet Government, he had a trial. As regards the last part of the question, the risks are so well ventilated in the Press that I do not think any special warning is required.
    Lieut. - Commander KENWORTHY: When was Mr. Davison executed, and what was his alleged offence?
    Mr. LOCKER-LAMPSON: The whole matter concerning Mr. Davison was dealt
    216
    with in a White Paper, where the hon. and gallant Member will be able to find the information he wants.

    GUILDFORD INFIRMARY (DEATHS).
    Colonel DAYasked the Minister of Health whether his attention has been called to the sudden death of Sarah Ann Edgerton and Elizabeth Fagent at the Guildford Infirmary after they were given medicine supposed to be liquorice powder, and that two other inmates at the same institution were given a dose of this powder and have become seriously ill; and whether, in view of the evidence of the doctor who performed the postmortem examination, he will have a special inquiry held into all the circumstances?
    The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Sir Kingsley Wood): My right hon. Friend has asked to be furnished with a report of the coroner's inquest, which was adjourned until the 27th instant, and will give the matter careful consideration when this report has been received.
    Colonel DAY: Will the Minister also take into consideration the second case referred to in which at woman died from the same effects about six weeks previously?
    Sir K. WOOD: I will make inquiries.

  UNEMPLOYMENT.

    TRAINING CENTRES.
    Mr. E. BROWNasked the Minister of Labour the present position of the training centres at Clayton, Birmingham, Brandon, and Wallsend-on-Tyne, showing the number of men in each centre who have completed the full course, the number of men who left before the end of the course, the number of men in training, and the number of men placed overseas?
    The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. Betterton): With the hon. Member's permission, I will circulate in the OFFICIAL REPORT a statement giving the desired information.
    Following is the statement:

    SCHEME OF TRAINING FOR YOUNG UNEMPLOYED MEN.

    Statement showing the position on 22nd June, 1927.

    —

    Completed full course.

    Left before end of full course.

    Men in training.

    Men placed overseas.

    Claydon

    …

    571

    271

    189

    368

    Birmingham

    …

    595

    1,048

    337

    —

    Brandon

    …

    316

    173

    195

    268

    Wallsend-on-Tyne

    …

    655

    600

    313

    —

    2,137

    2,092*

    1,034

    636

    * Of this number 1,272 left to take employment.

    TELEPHONE EQUIPMENT FACTORIES (DISMISSALS).
    Sir H. BRITTAINasked the Minister of Labour the figures of dismissals during the past six months from factories engaged in the manufacture of telephone plant and equipment mainly dependent upon Post Office orders?
    Mr. BETTERTON: I regret that statistics giving the desired information are not available.

    WIDOWS', ORPHANS' AND OLD AGE CONTRIBUTORY PENSIONS.
    Mr. BATEY: I beg to move:
    "That leave be given to bring in a Bill to amend paragraph (c) of Sub-section (1) of Section seven of the Widows', Orphans' and Old Age Contributory Pensions Act, 1925."
    This Measure is introduced to effect a small amendment of the present law, but a very necessary one. When the Act was under consideration in this House it was perhaps impossible, seeing that it was a very large Bill, for hon. Members to realise that this difficulty would arise; it was found out only when the Bill came to be put into force. A hardship is being inflicted upon the wives of men who, as we believe, are entitled to a pension under the Act. When the Bill was going through we really did believe that we had made provision for men who had complied with the conditions to obtain the old age pension when they reached 65 years of age, at least when they were 65 years of age on 1st January, 1928. We also thought that when that man's wife became 65 years of age, she too would be entitled to an old age pension. A man who reaches 70 years of age between now and 1st January, 1928, claims the old
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    age pension under the Old Age Pension Act. Although that man would have been entitled to the old age pension at 65 in January, 1928, simply because he has reached 70 years of age, he is told that his wife is not entitled to a pension until she reaches 70 years of age. I have here the case of an old man who wrote to me a letter which is an example that puts the matter far clearer than I could put it, and I propose to read it to the House in order that hon. Members may see exactly what we mean by amending this Clause. I will not give the name or the address of the writer, but the letter is as follows:
    "I note that on Tuesday you intend to introduce a Bill to correct a defect in the Contributory Pensions Bill. Take the case of myself and wife, for example. I have paid to the State Insurance both parts since 1912, and am still paying. I am 70 in September and shall be qualified to receive it, but my wife is 67 in September, and she was under the impression that she would be entitled to it in January next, being the wife of an insured person. She filled up the pink form, and gave all the particulars, but has now received a letter from the Ministry of Health informing her that she is not entitled to it until she reaches the age of 70. We could have managed with a struggle to have carried on with the £1 a week between us. They have taken the extra contributions from me and now they have let me down."
    The name of the writer is attached to the letter, and he calls himself "A worker in the building trade." It is a case like that we want to meet by this Bill. When a man is entitled to a pension at the beginning of next year that should not deprive his wife from the right of receiving her pension when she is 65 years of age. I content myself with asking for leave to introduce this Amending Bill.
    Question put, and agreed to.
    Bill ordered to be brought in by Mr. Batey, Mr. Clynes, Mr. T. Kennedy, Mr. Frederick Roberts, Mr. Smillie, Mr. Kelly, and Mr. Whiteley.

WIDOWS', ORPHANS', AND OLD AGE CONTRIBUTORY PENSIONS ACT (1925) AMENDMENT (No. 2) BILL,
"to amend paragraph (c) of Sub-section (1) of Section 7 of the Widows', Orphans', and Old Age Contributory Pensions Act, 1925," presented accordingly, and read the First time; to be read a Second time upon Monday, 11th July and to be printed. [Bill 166.]

MENTAL DEFICIENCY BILL.
Reported, with Amendments, from Standing Committee A.
Report to lie upon the Table, and to be printed.
Minutes of the Proceedings of the Standing Committee to be printed.
Bill, as amended (in the Standing Committee), to be taken into consideration upon Monday next, and to be printed. [Bill 165.]

COVENTRY CORPORATION BILL [Lords],
Reported, with Amendments, from the Local Legislation Committee (Section B); Report to lie upon the Table, and to be printed.
SELECTION (STANDING COMMITTEES).

  STANDING COMMITTEE A.
  Mr. WILLIAM NICHOLSON reported from the Committee of Selection; That they had discharged the following Members from Standing Committee A: Captain Brass, Major Colfox, Captain Gunston, and Mr. Herbert Williams; and had appointed in substitution: Captain Bourne, Mr. Duff Cooper, Viscount Elvedon, and Major Steel.
  Mr. WILLIAM NICHOLSON further reported from the Committee; That they had added the following Fifteen Members to Standing Committee A (in respect of the Wild Birds' Protection Bill): Mr. Barclay-Harvey, Colonel Douglas Clifton Brown, Lord Colum Crichton-Stuart, Mr. Rhys Davies, Sir William Edge, Major
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  Hills, Mr. Robert Hudson, Sir William Joynson-Hicks, Mr. Maxton, Mr. Hugh Morrison, Sir Clive Morrison-Bell, Dr. Drummond Shiels, Mr. Snell, Sir Fredric Wise, and Sir Hilton Young.
  Reports to lie upon the Table.

  MESSAGE FROM THE LORDS
  That they have agreed to—
  West Bridgford Urban District Council Bill, without Amendment.
  Westgate and Birchington Water Bill, with Amendments.
  That they have passed a Bill, intituled, An Act to consolidate the Scarborough Gas Company's special Acts; to extend their limits of supply; to authorise the company to acquire additional lands, to construct additional works, and to raise further capital; and for other purposes." [Scarborough Gas Company (Consolidation) Bill [Lords.]
  And also, a Bill, intituled, "An Act to authorise an alteration of the tunnel under the River Mersey authorised by the Mersey Tunnel Act, 1925; and for other purposes." [Mersey Tunnel] (Birkenhead Entrance, Etc.) Bill [Lords.]
  Scarborough Gas Company (Consolidation) Bill [Lords]
  Mersey Tunnel (Birkenhead Entrance, Etc.) Bill [Lords],
  Read the First time; and referred to the Examiners of Petitions for Private Bills.

ORDERS OF THE DAY.

  FINANCE BILL.
  Considered in Committee.
  [Captain FITZROY in the Chair.]

  FINANCE BILL.

    CLAUSE 1.—(Duty on, Tea.)
    Mr. JAMES HUDSON: I beg to move, in page 2, line 5, to leave out the word "fourpence" and to insert instead thereof the words "one penny."
    I propose this Amendment to reduce the duty to 1d., but our real intention is to obtain an entire abolition of the Tea Duty. Nevertheless, I wish to say that this Amendment is not, of a perfunctory character. It is quite true that it has been moved many times, and seems to be something in the nature of a hardy annual. With the passage of years the need for the acceptance of this proposal becomes greater and greater. When I first had the honour of moving this Amendment two years ago I expressed the hope that the Chancellor of the Exchequer on this question might come sufficiently near to the example set by the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) who in a previous year had effected a considerable reduction in the Tea Duty, and I was hopeful that the present Chancellor of the Exchequer in his turn might be glad to earn the credit of completing the process which the right hon. Gentleman the Member for Colne Valley initiated. I am sorry the Chancellor of the Exchequer withstood that temptation and continues to impose the Tea Duty, and states at the same time that the ultimate extinction of the Tea Duty is an important aim of his fiscal policy. I am pleased that in this matter the Chancellor of the Exchequer is following the gleam, although that gleam seems very much like a shadow or a will-o'-the-wisp which appears to get further away as we proceed towards it. The Tory Chancellor of the Exchequer is not alone in the difficulty of finding an ideal which it is not easy to practice. That was also the experience of hon. and right hon. Gentlemen below the Gangway who had before them for many years the Newcastle programme, and I believe that programme had some
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    influence at the time on the mind of the Chancellor of the Exchequer and the part which had reference to the free breakfast table was particularly useful to the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) in the presentation of many of his speeches in the country. Observe what happened when the right hon. Gentleman the Member for Carnarvon Boroughs was faced with the possibility of carrying out his ideals. It was very much like what is happening in the case of the present Chancellor of the Exchequer. On 2nd June, 1913, the right hon. Gentleman the Member for Carnarvon Boroughs, when discussing the effect of this class of taxation such as is imposed on tea said it was actually less than in any other civilised country in Europe, and he said:
    "It is a proposal to take £10,000,000 of taxation off a very considerable proportion of the population of this country who have great political power. You must not leave a class winch has great political power and control over expenditure without any share of responsibility."
    It is the theory that it is necessary to impose by a duty of this sort a sense of responsibility upon a considerable class of the community that is preventing successive Chancellors of the Exchequer from carrying out the ideal at which they profess to aim. Unfortunately, the theory of responsibility preached by the right hon. Gentleman the Member for Carnarvon Boroughs has become, in the mouth of the present Chancellor of the Exchequer, a theory of punishment. The idea, evidently, in the mind of the present Chancellor of the Exchequer, if we are to argue from what he said to us the last time this matter was discussed, is that it is necessary to retain this type of taxation—taxes upon sugar, taxes upon tea—because something happened last year for which, as he says, the community must pay, for which, indeed, somebody must be punished. Indeed, he used the word "punishment" in the phrase that he adopted in the House on that occasion. I think that, if the right hon. Gentleman will refresh his memory from the OFFICIAL REPORT, he will see that I am correctly representing the point of view that he took, that someone had committed acts last year which prevented him from doing what he would lead us to suppose he otherwise would have done. I can only say that, if it were possible to do unto Governments as they deserve to be done

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    unto, and if there is to be any punishment applied at all in connection with the events that happened last year, the punishment should fall, not upon the taxpayers, but upon those who impose the tax; for I would venture to suggest to the right hon. Gentleman that, if he would consider the case of the tea-drinking miners' wives of this country, and reckon up their deserts and the deserts of a Government who tried to persuade them that by a longer working day somehow or other things would come right, or, at least, would be improved—if he would talk to the working miners' wives to-day, he would find out how very much worse, in spite of all that the Government did, their lot has become. If any payment should be made, it should be made by those responsible for those changes.
    It has often been said, in the discussions in connection with this matter, that the Tea Duty, like duties placed upon some other commodities, is largely of a voluntary or optional character, that people, if they desire not to pay it, if they find it too burdensome, can avoid the burden by ceasing to consume the commodity upon which the duty is levied. The Chancellor of the Exchequer himself has destroyed, or at any rate considerably weakened, that theory by his own admissions. As he says quite frankly—I quote from the discussions that took place last year on this matter—
    "Tea and sugar, and commodities of that kind, are the basic comforts on which the household economy depends."
    He does not describe them, it is true, as absolute necessities, but the statement that he makes represents, I believe, not merely a theory, but an undoubted economic fact to the great mass of the working population of this country. The diet of millions of our people is an utterly monotonous diet. The opportunity of change from one type of food to another is entirely denied them. They and their children must continue day after day eating something that is almost as little varied, especially in these days of depression, as the diet of the Irish labourer, which for years was nothing but the one commodity, potatoes. In thousands, probably millions, of English homes at the present time, there is little variation from a constant diet of bread, with, perhaps, a little fat of some sort to enable it to be consumed. Meat becomes more
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    and more a rare article of diet, particularly for great bodies of the unemployed and for those whose wages have been so considerably reduced; and to make such a diet palatable at all it is a, necessity—not merely a comfort, as the right hon. Gentleman said, but a necessity—that there should be some means of providing a drink for the people that will enable them to get any satisfaction out of such a diet. For that reason, therefore, the consumption of tea by large numbers of the workers of this country may be regarded as almost as much a necessity as the consumption of bread itself.
    If I am correct in tint estimate of the position, then I suggest that the next argument which I desire to present to the Committee—and it has been presented already by several of my hon. Friends—becomes of very serious import. The fact that the tax upon tea is a flat-rate tax, and not an ad valorem duty, means that that tax falls most heavily upon the people who most require this commodity to make their diet palatable. Working people buy tea at a price somewhere between 1s. 6d. and 2s. a pound the poorer working people, particularly, very rarely paying much above 1s. 8d. a pound for the tea that they buy. A tax of 4d. a pound on tea at that price means a 20 per cent. tax upon those persons. A tax of 4d. a pound upon tea consumed by other classes in the community—people who are able to afford 3s. 6d., 3s. 8d., 4s. 0d., or more per pound—becomes a tax of considerably less than 10 per cent.; so that the continuance of the tax on this particular commodity is specially burdensome upon the class that this Committee ought to be most anxious to relieve of taxation.
    4.0 p.m.
    There is another interesting factor about this unequal incidence of taxation, which I believe is not very often referred to. The tax upon tea operates with a different incidence in different districts. It is a remarkable fact that in certain areas, where the water supply is pure, with little admixture of lime or other materials, very much less tea is required to get the infusion than is the case where the water supply is not so pure. I know that some hon. Gentlemen may think that this is rather straining an interesting point, but it has a very practical bearing. I was talking only recently to a working-class woman whose home was

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    removed from the Manchester area to the Stockport area. In Manchester they get their water from Thirlmere, while in Stockport they have a water supply that is drawn from the Derbyshire district, and I believe there is a good deal of lime in the water. This working-class woman told me, in the quaint way that working people have in our district, that, when she was in Manchester, for her family of four, she used to put five tea-spoonfuls into the teapot, one for each person and one for the pot; but that now she had gone to Stockport, it had to be still one teaspoonful for each person, but the pot now required three. Therefore, the Stockport working woman, to procure the same result in the infusion of tea, is actually paying, not only more for her tea in the long run, but is paying a bigger tax to the community than the Manchester woman; and, I would add, that argument applies particularly strongly when you come to a place like London, with its chalky water supplies, where the quantity of tea required is even greater than in the area to which I have referred. I pass from the question of the difference in the incidence of this tax to another point. The continuance of a tax on this commodity, as, indeed, upon any commodity, as is well known to theoretical economists, gives more and more opportunity to the trust and the large firm to operate the article which is taxed. The artificial difficulties created by taxation of any kind, the difficulty of having to deal with bonded warehouses, the necessity of having to work in a certain area, often means that the small man is driven out by the competitive forces of the time, and it is only the large firm and trust which remain. In fact, we have admitted from these benches, that although my right hon. Friend reduced the tax upon tea considerably in 1924, for a time some part of that reduction could be seized upon by large tea trusts who were able to operate in this particular market, and this possibility remains at a maximum as long as the tax upon tea remains. If you could entirely free this commodity from tax, Free Trade in tea would be much more a reality, as far as the large trust is concerned, that is the case at the, present moment. In passing, I may say, as my hon. Friend the Member for Hillsborough
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    (Mr. A. V. Alexander) pointed out in the House, in spite of the operations of the tea trust in 1924, it was none the less true that in the co-operative societies alone in that year, there was an increase in the consumption of tea of more than 6,000,000 1bs., and what could be accomplished then would be accomplished to an even greater extent if the Chancellor of the Exchequer would agree to the entire abolition of the Tea Duty.
    There is a further interesting set of reactions that, I think, ought to be studied by us before a final decision is reached on this question, and if those reactions are to be considered wholly, it is worth while for a moment to-day to consider the general drinking habits of the community. The community to-day is spending upon one set of intoxicants—and I would remind the Chancellor of the Exchequer of this particularly—far more than the community can afford.
    Viscountess ASTOR: Hear, hear!
    Mr. HUDSON: £300,000,000 and more per annum on the drink bill ought to be a matter of very careful consideration for a Chancellor who pretends that he cannot make reductions of the sort that I am proposing because the community cannot afford it. The community can afford it as long as it can pay for intoxicants a sum of money to the extent I have named.
    Viscountess ASTOR: Hear, hear!
    Mr. HUDSON: I wish the Noble Lady would let me put my case. I am putting a case which, I think, is of wide application, and if she would hold her peace I think my hon. Friends would quite understand—
    Mr. ERNEST BROWN: The hon. Member ought to be grateful for her assistance.
    Mr. HUDSON: I am sure the Noble Lady wants to assist, but I can imagine some hon. Members not being quite so open to my argument as they might otherwise be if that support were not so vigorously expressed. Members in this House often argue, when we put the case of too great an expenditure on intoxicants, that the way to deal with that evil is not by legislation but by education. Give the people, they say, through education, through propaganda, through new facilities, an opportunity to

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    know that there is something better than intoxicants to consume. If that be the only valid argument, it becomes very important that the community should give the substitute for intoxicants a maximum of encouragement, and the community that continues to place taxes upon any commodity that should become a substitute for intoxicants is really doing its best to keep the community wedded to the intoxicants. This dependence upon education for the settlement of our difficulties regarding intoxicating liquors is nothing more than a pretence, especially when the purchase of tea continues to be a difficult matter for a large section of the community.
    Let me examine this a little more closely. In this Budget there has been an increase in certain taxes upon wine, and I suppose that the people who are taxed on their wine will be able to transfer their burden, if they desire to do so, by drinking tea instead of wine. They will want a good tea if they have habituated themselves to drinking wine. It is comparatively easy, in the present state of the tea tax, for a wine drinker to transfer his habits to tea drinking as far as taxation is concerned, for the wine drinker, if he gives up wine and takes tea, probably gives for his tea 4s. or 5s a pound, and only pays 4d. in taxation on that tea, or probably from 5 to 10 per cent. But with regard to the person in the slums who has become habituated to drinking beer, whom you want to educate and encourage into different habits, if, as an alternative, he drinks tea at 1s. 8d. a pound, which is about the best he can buy, you place upon that tea a tax of 20 per cent. So that you are taxing a beer-drinker, if he changes over to tea as a substitute, 20 per cent., whereas you tax the wine drinker who takes tea as a substitute only about 5 per cent.
    If there be any sincerity in the argument about the educative value of substitutes, the Chancellor of the Exchequer ought to be very glad indeed to support this Amendment. Unfortunately, I am afraid, that the right hon. Gentleman develops like most Chancellors of the Exchequer develop, if I may speak with respect, a strain of idleness with regard to taxes which have continued for many years, and which may be expected to yield, if they remain, a favourable
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    revenue for many years to come. I was reading in Bastable's "Public Finance" the other day, the statement which applied to all Chancellors, that taxes of the kind we are now discussing are both productive, and, in times of prosperity, elastic, without any undue pressure having to be used, and Chancellors of the Exchequer, who may sometimes get worried about the results of pressure which it is necessary to use in the raising of taxes, would prefer to stick to those taxes which prove elastic, whatever their ideals might be about the ultimate end. I would remind the right hon. Gentleman the depression we are in is so long continued, that there can little incentive left to any Chancellor for continuing this tax for, at any rate, the reason given by Bastable.
    What I am suggesting is happening now is what happened at the end of the Napoleonic Wars. We are in a position of depression so long continued that it has become one of the first problems of statesmanship to relieve those heavily burdened masses of the community upon whom the real prosperity of our country depends. Economic history has taught us to recognise the beneficent action of Wallace and Huskisson who, in 1823, started us on the road to the dropping of taxes on commodities, even although the financial position of the community at that time was a very hard one, and even although Huskisson, had he been as foolish as the present Chancellor of the Exchequer, might just as easily have said he had the excuse of the disorders of that time for keeping on the heavy taxation from which the people in those days were suffering. But Huskisson and Wallace and other statesmen since have realised that if the community was to be put upon its feet, taxes upon commodities must he more and more diminished until they were finally abolished. In the spirit of the days when Euskisson and Wallace lived, I put forward, as the whole party to which I belong puts forward this Amendment, and I hope the Chancellor of the Exchequer, before it is too late, will be able to give some heed to the plea we make.
    The CHANCELLOR of the EXCHEQUER (Mr. Churchill): The hon. Gentleman has made a very eloquent speech, and won the approval not only of

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    the Committee but also of the Noble Lady. Even thus fortified, I am afraid I cannot respond to the appeal he has made, although I heartily congratulate him upon its form, and also upon the fact that in part, at any rate, he found something new to say upon this subject. We have debated this tax in the present Parliament nine or 10 times—on the Resolution, on the Report of the Resolution, in Committee and on Report, and this is the third Budget—and I think there is no one who, wherever he sits, would seriously propose to take a course different from that which we find ourselves obliged to adopt. The hon. Member spoke of the monotony of diet of the British wage-earning classes and their hard existence, but, considering all that we have passed through in the Great War, and in the continued and repeated industrial confusion of our country, the remarkable thing is that the consuming power of the people should not have been prejudicially affected. It has not, on the whole, been prejudicially affected. It compares, as everyone knows, very favourably with that of every European nation. In fact, the foreign wage-earning classes would be delighted if at any time they were able to command either the quantity or variety of food and drink which our people, I am thankful to say, in spite of all our difficulties, are still able to obtain.
    The tendency on the whole is for a slight upward movement in the consumption of tea. There has been since the War a strong recovery and, since the reduction the right hon. Gentleman opposite made, a complete recovery in the consumption. It is very remarkable that in spite of the industrial troubles of last year, the consumption of tea, sugar, tobacco, and also of bread and meat, was not seriously affected. On the whole there is no doubt or question that the general condition in which the mass of the people of the country live is superior to that of any European nation, and especially to that European or Asiatic Power which always claims a meed of approbation from those who sit opposite. The hon. Member has reminded me of an argument which he says I used at an earlier stage when I said I was keeping the Tea Duty on as a punishment. Whether I used the word punishment or not—I have not refreshed my mind with
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    the context—it is not the doctrine of punishment that inspires me in the matter. It is the doctrine of consequences. The finances of the year have been completely disorganised and we have had to face an enormous deficit, which with very great difficulty we have endeavoured to circumvent without additions to the burdens of the masses of the people or without imposing still harder direct taxation. We have managed to come through those difficulties, but it is obvious that the remission of the Tea Duty is quite beyond my power in the circumstances. The Amendment would, I think, cost something like £3,500,000, and a complete repeal of the duties would cost between £5,000,000 and £7,000,000. I cannot contemplate for a moment such an abstraction from my limited resources.
    The hon. Member devoted a large portion of his speech to showing how the Tea. Duty in its present form fell upon the poorest consumers, and he pointed out how much better it would be if an ad valorem instead of a specific tax were imposed. The argument was specious and was developed with some skill, but I really cannot answer the hon. Member better than similar arguments were answered by the late Chancellor of the Exchequer when he occupied a position of greater responsibility and, from some points of view, less freedom. Dealing with this very argument, the right hon. Gentleman said:
    "On the face of it, it would appear reasonable that the duty upon tea should bear some proportion to the value of the article, but whatever strength there is in that demand is derived from the idea that the rich man's tea ought to pay a higher rate of duty than the poor man's, and I shall have occasion to show that, however cogent that reason may appear on the surface, as a matter of fact in practice there is little or nothing in it."
    Little or nothing in the excellent speech to which we have listened:
    "It is a mistake to suppose that the working people of the country consume wholly cheap tea. As a matter of fact the working people of the country have discovered that cheap tea is not economical."—[OFFICIAL REPORT, 30th June, 1924; col. 962, Vol. 175.]
    The consumption of tea on the whole is increasing, and the consumption of alcoholic liquors is decreasing at a rate which causes anxiety to the Exchequer

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    and joy to the Noble Lady. I cannot believe it would be desirable in the interest of temperance for us to place ourselves in the serious difficulty which would result from an immediate abrogation of the duty upon tea. The duty on tea, almost alone among the sources from which our revenue is raised, is actually lower than it was before the War after eight years of enlightened Liberal and Radical administration; and when we are looking around for subjects for immediate reduction, however desirable a reduction of the duty on tea may be, I am sure it is not one which would have the first claim. I would put it very high in the order of priority of reduction but I am not called upon at present to choose between taxes that can be reduced, because I am only in the position of making my way with great difficulty through a Budget which, in spite of every device I could think of, and which it is my duty to search for, is only now narrowly maintaining its equilibrium.
    Mr. E. BROWN: The speech of the hon. Member for Huddersfield (Mr. J. Hudson) was interesting. It shows the different view taken in the House about the Tea Duty according to whether you sit on that side or this. I very well remember when the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) reduced the Tea Duty two years ago, certain Members who are now on those benches were not satisfied with the reduction, and they proceeded to set a precedent for the hon. Member for Huddersfield by moving a still further reduction with the purpose, of course, of obtaining leaflets, which were duly used at the succeeding election against those of us who supported the then Chancellor of the Exchequer in trying to get a stable, Radical Budget. The hon. Member for Huddersfield, in his excellent speech, was a little self-righteous, for when he claimed for the right hon. Gentleman the Member for Colne Valley the sole credit for the reduction of the Tea Duty, he should have remembered that there were about 130 members of the party represented on these benches without whose votes that reduction could not have been got. Also when he referred to the breakfast table duties and the promises of pre-War days, despite
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    the one Budget of the right hon. Gentleman, for which we were grateful, two years ago the amount collected, taking a comparison between Great Britain and Northern Ireland, from which area the tax is now collected, and the United Kingdom, for which it was then collected, is relatively higher than it was in 1913.
    I find on reference to the figures that in 1913 the Exchequer revenue from tea was £6,499,000 while in 1925 it was £5,789,000. The rate of tax may have been lower, but the amount got from the women and children was higher. So I hope when he is developing his argument outside the House, he will not forget to point out that it is not his party alone that was responsible for the reduction two years ago but there were others concerned. I am sure the Committee have heard with pleasure the last sentences of the Chancellor of the Exchequer that, if he gets an opportunity next year, he will make a remission of taxation, and we shall confidently hope that he will adopt the model of the British Navy and put women and children first if any remission of taxation is to be given, such as a remission of the duty on tea, which affects women and children more than any other section of the community.
    Viscountess ASTOR: I rise to make a slight protest. I quite understand that the Chancellor of the Exchequer may not be able to accept the Amendment, and the late Chancellor of the Exchequer could not have done so, but it is a very serious point that the right hon. Gentleman should make the assertion that it pleased the Noble Lady the Member for Plymouth that drink was going down. Surely as a nation we cannot go on spending £300,000,000 on drink—in fact, it is more than that—and it will not go down as long as we have men in public life who refuse to face facts that are so disquieting to many of us, who are not only looking to the revenue from a money point of view, but from the point of view of the permanent good of the country. It is disheartening, when people see the great efforts the country is making to get back industrial supremacy, to see that we do not get a, lead from our leading men to warn us against such appalling extravagance, which belongs, not to one section of the country nor to one section of the House of Commons. I do

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    not want to make it a party question. It it not a party question but a national question.
    Mr. STEWART SAND EMAN: Are we not discussing tea?
    Viscountess ASTOR: We are discussing drink. It is all very well to try and make a joke, but it is not a joke. We belong to the Conservative party, which is interested in Imperial politics and has an Imperial point of view. Our Dominions have faced this question of drink, and throughout the Dominions they are doing all they can. We are looking forward to the time when we can take the tax completely off tea and the commodities that the people of the country need, but until we face up to the appalling expenditure on drink, I see no chance of reducing the tax, and that is not a question for one side but for all sides of the House. It is pre-eminently a woman's question, because in spite of the hard times we have been through, we must still spend money on tea and sugar. It is a great tribute to the people of the country that when they are hard pressed they will still look after their children, but let the Chancellor remember that women—I know that is a tender subject with him—
    Mr. CHURCHILL: I hope not only in their electoral capacity.
    Viscountess ASTOR: I would not dare to be so personal as the Chancellor of the Exchequer, because my knowledge is too great to deal in personalities. I would say to the right hon. Gentleman, always remember whenever you come to reduce taxation on commodities, if possible, reduce the tax on commodities which the people must have, and raise the taxation on things which people need not have, and one of those things is intoxicating drink.
    Mr. SNOWDEN: Although the subject to which the Noble Lady has devoted her observations is only indirectly associated with the matter raised by the Amendment, I do not regret that this question of the enormous and wasteful expenditure upon drink has been introduced into the Debate. I will not pursue it further than to say that I have been amazed during the last few years, knowing all the talk we have had about the need
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    for national economy, to find commercial men, especially, so ignorant in regard to what is the greatest and the biggest form of national expenditure, and one of which the Chancellor of the Exchequer ought not to be neglectful. I do not know whether the Chancellor of the Exchequer intended by an observation that he made to convey what appeared to me to be the obvious implication of his remarks, when he urged as a reason why no reduction of the Tea Duty ought to be made at the present time, that an increase in tea drinking might have an injurious effect, from the point of view of revenue, upon the receipts from alcoholic liquor.
    Mr. CHURCHILL: I never said anything like that and I never thought anything like that. That was rather fastened upon the remarks I made by the Noble Lady.
    Mr. SNOWDEN: I referred to the observation because it was quite clear to me, and I think it must have been to other hon. Members, that that was the only reasonable interpretation that could be put upon the right hon. Gentleman's remarks. I am, therefore, glad, and the right hon. Gentleman ought to be glad, that I have given him the opportunity of repudiating what seemed to me to be the obvious interpretation. I must have listened to between 50 and 60 Debates in this House on the Tea. Duty, and upon such a hackneyed subject it is very difficult to say anything new. I should like to join with the Chancellor of the Exchequer in extending to the hon. Member for Huddersfield (Mr. J. Hudson) our hearty congratulations, not merely upon the great ability which he displayed in his speech, but upon the introduction of new matter into this well-worn theme. The Chancellor of the Exchequer, as we expected, has declined to accept the Amendment. The reason he has given is that the financial position of the country is such that he cannot possibly afford the small loss of betwen £2,000,000 and £3,000,000 of revenue which would be involved in the acceptance of this Amendment. The Noble Lady said that if we had been in office I should not have reduced the Tea Duty still further, or have abolished it. I can assure the Noble Lady that if I had had an opportunity of introducing a second Budget in this House, there

    243
    would have been neither Tea Duty nor Sugar Duty nor any duty upon any article of food in the fiscal system of this country. The money was there in the right hon. Gentleman's first Budget. He inherited a surplus which would have provided sufficient money to sweep away all food taxation, and have left a considerable margin, but he did not do that. He preferred other means of disposing of that surplus. He reduced the Income Tax and Super-tax.
    Lieut.-Colonel Sir FREDERICK HALL: And he increased the Death Duties to the same amount.
    Mr. SNOWDEN: He did no such thing. If the hon. and gallant Member was not quite so impetuous in his observations he might be a little more accurate, and perhaps there would be more common sense in his observations. The Chancellor of the Exchequer did not choose to use the surplus for the reduction of taxation upon the necessaries of life, or upon what he described as the basic comforts of the working classes. One reason why we have a claim upon the Chancellor of the Exchequer for a reduction of taxation on tea or sugar in this Budget is the record of Conservative Governments since the end of the War. The only reductions in indirect taxation which they have made have been the reduction, in the Tea Duty in the Budget presented by the right hon. Member for Hillhead (Sir R. Horne), a reduction of 4d. per pound, and a reduction in the Beer Duty. All the other remissions of taxation, during a period of abounding revenue and huge surpluses, have been in favour of the well-to-do and the rich portion of the community. Therefore, we have a claim upon the Chancellor of the Exchequer now. The right hon. Gentleman has not only not reduced any working-class taxation in any of the three Budgets for which he has been responsible, but he has increased the taxation upon the working classes very considerably. There are, I suppose, at least 12 articles in common use amongst the working classes to-day which are bearing very heavy taxation: taxation which was not in existence or operation before the right hon. Gentleman took charge of the finances of this country. There has only been the comparatively slight reduction in indirect taxation which was made in the Budget
    244
    of four or five years ago, namely, the reduction of the Tea Duty.
    We did not expect that the Chancellor ob the Exchequer would accept this Amendment. He tells us that he is not in a position to do so. We know that the finances of the country, after three years of his business management, are not in a position to afford reductions in this taxation. I do not expect, so long as the right hon. Gentleman remains in his present office, that we shall have any balance. As I have mentioned already, he had a very large surplus from his predecessor, but the two Budgets for which he has been responsible up to now have shown very large deficits. Therefore, we shall have to wait until we get rid of this Government, and with it get rid of the Chancellor of the Exchequer, before we can expect a fulfilment of this almost century-old demand for a free breakfast table, and the removal of taxes upon the necessaries of life. Judging by all the evidence which the country supplies, I do not think we shall have to wait very long for that desirable event.
    Mr. MONTAGUE: It is a remarkable thing that in any discussion of this character opportunity is taken by certain hon. Members to bring up the question of teetotalism. I do not want to make a speech in favour of drink; I am an abstemious person. I wonder why fallacious economic arguments are always put forward when such questions come up. I realise, of course, that this subject is somewhat removed from the question of the Tea Duty, but it has been discussed, and I should like to refer to it. We have been told by the right hon. Member for Colne Valley (Mr. Snowden) that one form of national expenditure in these days in regard to which we require economy is of the most wasteful and the most baneful form possible. I am not going to say much about the banefulness of it. Excess of every kind is baneful; but I am comforted by the fact that drunkenness and excess in the consumption of alcoholic liquor are going down very rapidly in this country. That is very satisfactory.
    What I want to put to the last speaker is this, that as far as the working-class people are concerned—when it is a question of the reduction of taxation upon food, working-class people are concerned more than any other class of people—

    245
    the amount expended in recreation of one kind or another is an amount that ought to be able to be afforded by the working-class community, considering the progress that we have been making for many years past in the power of production, in the power of utilising labour and natural resources for the production of wealth. What is it that the workers spend? They spend something like £30 per family, on the average, on intoxicating liquor. It may be a bad thing that they do that, and it might be better that they should spend the money on ginger pop, or something else; but my point is, whether we describe that expenditure as wasteful or not, the workers are entitled to spend —30 a year in recreation, in beverages or anything of the kind, wasteful or not.
    The DEPUTY-CHAIRMAN: The hon. Member is now discussing a subject which has no connection with the Amendment, which is, that the Tea Duty be reduced.
    Mr. MONTAGUE: I do not intend to occupy the time of the Committee further, but the point has been raised and I regard it as a complete fallacy. Every time this question is raised we are treated to teetotal lectures, and something ought to be said in order to put the economic point of view. The workers are not poor because they drink; they are poor becausee they are robbed.
    Mr. SCRYMGEOUR: I want to deal with the reference made by the right hon. Member for Colne Valley (Mr. Snowden) when he said that it is a most important thing from the point of view of securing a reduction in our taxation that the business men of the country do not face up to this question. During the War the business men of this country took a great stand in regard to the subject which has been introduced into this discussion. They called for the stoppage of the drink traffic, which undoubtedly does provide a very considerable sum of money to the revenue. They called for the complete stoppage of that particular business, which meant a tremendous drop in the revenue of the country at a time when, because of the War, it was most essential to raise money by loans. I ask now: How is it that on such an important question we do not have the business inn of the country entering into the arena, pressing this particular question,
    246
    and urging the complete cessation of this wastage? Reference was made to the question of alcoholic consumption by the lion. Member for Islington West (Mr. Montague), but it does not affect the point. From the Labour standpoint, the money spent on alcoholic liquor is a great loss to the poor and to the nation. It makes the weakest demand upon the Labour market and gives the least return in wages. This question baffles every political party in this House.
    In dealing with the Tea Duty the hon. Member for Huddersfield (Mr. J. Hudson) undoubtedly presented his case splendidly, and I congratulate him. He stressed the point that the great body of working people in this country consume tea as a food, though not to such all extent as formerly, because they do not use tea at dinner as well as at tea-time; but to a very large extent it is true that the working class use tea as a food, and you are therefore making a tremendous demand upon them in the way of taxation. If there be a desire on the part of the Government to meet the needs of the people, it is not sufficient for the Chancellor of the Exchequer to make comparisons between this and other countries.
    We are proportionately better off in other respects than some other countries, but, if you take that phase of the question which has been introduced into this Debate, you will find that the working people even now are not consuming so much of the particular liquor we are talking about. Why? Because of the prevailing industrial conditions. When industrial conditions are down, down goes your revenue—on this particular kind of beverage. There is all the more reason, therefore, why the Government should wipe out the taxation on such a commodity as tea. My contention goes beyond the proposal of the right hon. Member for Colne Valley to abolish the duty on tea and other taxes on what is called the breakfast table. I contend that every method of indirect taxation should be abolished. It does not matter from the taxation point of view whether it is considered a legitimate commodity or not, but why should people be taxed on the strength of their consumption? Why not put a tax solely, wholly and directly upon what is the particular revenue or income of an individual? By doing that, we should be getting back to

    247
    the old-time basis of our taxation, every departure from which is a gross injustice to the body of the people.
    Mr. R. MORRISON: I only rise to make an endeavour to bring the Committee back to the question under discussion. I think it is very unfortunate that this discussion should have been side-tracked so largely into something else. My objections to the duty upon tea are these. At the present time, there is no duty on the Statute Book which is more indefensible than this duty upon tea. The Chancellor of the Exchequer pointed out that in all the industrial troubles we had last year, the people's consumption of tea did not decrease. That, he said, was one of the reasons which led him to think that the working-classes of this country had not suffered so much as some people said. Now, paradoxical as it may seem. when hard times come, the consumption of tea is bound to go up for the simple reason, as was seen in the first week of what is called the general strike, that the working-class people have tea and bread instead of their ordinary dinner. That is to say, the working-class households used tea at the mid-day meal as well as in the morning and evening. This duty is a tax upon a necessary of life, because tea is not a luxury.
    One of the objections which we have to this duty is that it is not a case where the strongest back bears the biggest burden. The poorer people are, the more does tea enter into their diet. Compare this duty with the Income Tax. Certain abatements are given to a man who pays Income Tax if he has a family. With the Tea Duty it is just the opposite. The larger a man's family, the more duty he pays. Every working-class woman in this country would look upon it as a great boon if this duty were removed. The women of this country are now taking an increasing interest in politics. That is becoming increasingly evident, and there is no question in which they take a keener interest than in the taxation of the necessaries of life. Tea has become a necesary of life.
    I do not suppose the Government will accept this Amendment, or that the duty will be abolished, but future Governments will find that they cannot shuffle off this thing and say that it is a hardy
    248
    annual and that nobody expects anything original to be said about it. To-day, I suppose, the same arguments will be used, and the same division will be taken for party purposes, and nothing will be done. The women of this country—and especially the working women—are, I repeat, taking much more earnest interest in politics and regarding it less as a game. They will not put up with this taxation much longer. Many thousands of women in this country are beginning to realise that since the present Chancellor of the Exchequer took up office, not a penny has come off the taxation of the working-class people. On the contrary, it has been increased. There is not only a duty upon tea, but the Chancellor of the Exchequer has now put a duty on the teapot as well. I hope the time will come when questions such as this will not be treated as this Amendment has been treated this afternorm, and that something will be done instead of having the same arguments and the same division as we are getting to-day.
    Mr. J. JONES: I want to subscribe to and support the theory advanced by the hon. Member for Dundee (Mr. Scrymgeour). He slid taxation should be based upon the ability to pay. Therefore, I hope he will get the necessary relief from some future Chancellor of the Exchequer, because if there be any class of people in the community who are taxed up to the eyebrows it is those who indulge in alcoholic liquor. It may or may not be good for them to indulge in this liquor.
    The DEPUTY-CHAIRMAN: It would unduly prolong the Debate if I allowed a discussion on the taxation of alcoholic liquor.
    Mr. JONES: Well, we sometimes mix liquor with tea, so that there is a connection between the two. If one drinks alcoholic liquor, there is no one to defend him. I am speaking as one who drinks a glass of beer. Taxation ought to be based on the ability of a person to pay. The question of how people spend their money is another matter altogether. That is why I object to this discussion of the difference between tea and liquor drinking. The opinion about those of us who drink a glass of beer is that we are very wicked people. We are not. We are just as good and just as clean

    249
    as those who do not. We never make any money out of drink; we spend money on it. It is a bit too thick to hear people "who have made fortunes out of beer lecturing us about the evils of drink, and the money spent on it. I am in favour of the abolition of all duties on people's food, and I am willing to run the risk of telling my constituents, "Let the Beer Duty continue, but let us have a free breakfast table." We have heard a good deal this afternoon about the general strike. The general strike seems to be like King Charles' head to the people on the other side of the House, for when they want an excuse for their political rascality, they bring it in. I cannot talk about beer any more with

    Division No. 214.]

    AYES.

    [5. 0 p. m.

    Acland-Troyte. Lieut-Colonel

    Crookshank, Col. C. de W. (Berwick)

    Holt, Capt. H. P.

    Agg-Gardner, Rt. Hon. Sir James T.

    Crookshank, Cpt. H. (Lindsey, Gainsbro)

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Ainsworth, Major Charles

    Dalkeith. Earl of

    Hope, Sir Harry (Forfar)

    Albery, Irving James

    Davies, Mal, Geo. F. (Somerset, Yeovil)

    Hopkins, J. W, W.

    Alexander, E. E. (Leyton)

    Davies, Sir Thomas (Cirencester)

    Hopkinson, Sir A. (Eng. Universities)

    Applin, Colonel R. V. K.

    Davies, Dr. Vernon

    Hopkinson, A. (Lancaster, Mossley

    Apsley, Lord

    Davison, Sir W. H. (Kensington, S. )

    Horne, Rt. Hon. Sir Robert S.

    Ashley, Lt. -Col. Rt. Hon. Wilfrid W.

    Dean, Arthur Wellesley

    Howard-Bury, Lieut. -Colonel C. K.

    Astor, Viscountess

    Dixon, Captain Rt. Hon. H.

    Hudson, R. S. (Cumberl'nd, Whiteh'n)

    Balniel, Lord

    Drewe, C.

    Huntingfield, Lord

    Barclay-Harvey C. M.

    Eden, Captain Anthony

    Hurd, Percy A.

    Barnston, Major Sir Harry

    Edmondson, Major A. J.

    Hurst, Gerald B.

    Beckett, Sir Gervase (Leeds, N. )

    Ellis, R. G.

    Inskip, Sir Thomas Walker H.

    Bellairs, Commander Carlyon W.

    Elveden, Viscount

    Jackson, Sir H. (Wandsworth, Cen'l)

    Benn, Sir A. S. (Plymouth, Drake)

    Erskine, Lord (Somerset, Weston-s.-M.)

    Jacob, A. E.

    Bennett, A. J.

    Evans, Captain A. (Cardiff, South)

    James, Lieut. -Colonel Hon. Cuthbert

    Berry, Sir George

    Everard. W. Lindsay

    Jephcott, A. R.

    Bluntdell, F. N.

    Falle, Sir Bertram G.

    Kidd, J. (Linlithgow)

    Boothny, R. J. G.

    Fermoy, Lord

    King, Commodore Henry Douglas

    Bourne, Captain Robert Croft

    Fielden, E. B.

    Kinloch-Cooke, Sir Clement

    Bowyer, Captain G. E. W.

    Ford, Sir P. J.

    Knox, Sir Alfred

    Braithwaite, Major A. N.

    Forestier-Walker, Sir L.

    Lane Fox, Col. Rt. Hon. George R.

    Brass, Captain W.

    Foster, Sir Harry S.

    Leigh. Sir John (Clapham)

    Brassey, Sir Leonard

    Foxcroft, Captain C. T.

    Lister, Cunliffe, Rt. Hon. Sir Philip

    Brittain, Sir Harry

    Fraser, Captain Ian

    Locker-Lampson, G. (Wood Green)

    Brooke, Brigadier-General C. R. I.

    Fremantle, Lieut. -Colonel Francis E.

    Looker, Herbert William

    Broun-Lindsay, Major H.

    Ganzonl, Sir John

    Long, Major Eric

    Brown, Brig.-Gen. H. C. (Berks, Newb'y)

    Gates, Percy

    Lowe. Sir Francis William

    Buchan, John

    Gibbs, Col. Rt. Hon. George Abraham

    Luce, Major-Gen. Sir Richard Harman

    Buckingham, Sir H.

    Gilmour, Colonel Rt. Hon. Sir John

    Lumley, L. R.

    Bullock, Captain M.

    Glyn, Major R. G. C.

    Lynn, Sir R. J.

    Burman, J. B.

    Grace, John

    Macdonald, Capt. P. D. (I. of W.)

    Butler, Sir Geoffrey

    Grattan-Doyle, Sir N.

    Macdonald, H. (Glasgow, Cathcart)

    Cadogan, Major Hon. Edward

    Greene, W. P. Crawford

    McLean, Major A.

    Caine, Gordon Hall

    Grenfell, Edward C. (City of London)

    Macmillan, Captain H.

    Campbell E. T.

    Gretton, Colonel Rt. Hon. John

    Macnaghten, Hon. Sir Malcolm

    Cayzer, Sir C. (Chester, City)

    Grotrian, H. Brent

    McNeill, Rt. Hon. Ronald John

    Cayzer. Maj. Sir Herbt. R. (Prtsmth, S.)

    Gunston, Captain D. W.

    Malone, Major P. B.

    Cazalet, Captain Victor A.

    Hacking, Captain Douglas H.

    Manningham-Buller, Sir Mervyn

    Cecil, Rt. Hon. Sir Evelyn (Aston)

    Hall, Lieut. -Cot. Sir F. (Dulwich)

    Margesson, Captain D.

    Chadwick. Sir Robert Burton

    Hammersley, S. S.

    Marriott, Sir J. A. R.

    Chapman, Sir S.

    Harrison, G. J. C.

    Meyer, Sir Frank

    Christie. J. A.

    Hartington, Marquess of

    Mitchell, S. (Lanark, Lanark)

    Churchill, Rt. Hon. Winston Spencer

    Harvey, G. (Lambeth, Kennington)

    Mitchell, W. Foot (Saffron Walden)

    Churchman, Sir Arthur C.

    Harvey, Major S. E. (Devon, Totnes)

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Cobb. Sir Cyril

    Haslam, Henry C.

    Moore, Lieut. -Colonel T. C. R. (Ayr)

    Cochrane, Commander Hon. A. D.

    Hawke, John Anthony

    Moreing, Captain A. H.

    Cockerill, Brig.-General Sir George

    Headlam, Lieut.-Colonel C. M.

    Murchison, Sir Kenneth

    Colfox, Major Wm. Philip

    Heneage, Lieut-Colonel Arthur P.

    Nelson, Sir Frank

    Conway, Sir W. Martin

    Hills, Major John Waller

    Newman, Sir R. H. S. D. L. (Exeter)

    Cooper, A. Duff

    Hilton, Cecil

    Nicholson, Col. Rt. Hon. W. G. (Ptrtf'ld.)

    Cope, Major William

    Hoare, Lt. -Col. Rt. Hon. Sir S. J. G.

    Oman, Sir Charles William C.

    Courthope, Colonel Sir G. L.

    Hogg. Rt. Hon. Sir D. (St. Marylebone)

    Penny, Frederick George

    Craig, Sir Ernest (Chester, Crewe)

    Hohler, Sir Gerald Fitzroy

    Percy, Lord Eustace (Hastings)

    out infringing the Rules, but it is a subject that could be talked about a lot. The more you get of it, the more you are able to talk. So far as this particular duty is concerned, the Tea Duty, it is the most indefensible tax of all. It strikes at the very poorest of the poor, because the average poor man cannot afford to buy more than one pound of tea per month. Therefore, we are all agreed on these benches that this duty should, be removed. Whatever we may say about beer, we are united about tea.
    Question put, "That the word 'four-pence' stand part of the Clause."
    The Committee divided: Ayes, 221 Noes, 121.

    Perkins, Colonel E. K.

    Smith-Carington, Neville W.

    Warrender, Sir Victor

    Pownall, Sir Assheton

    Somerville, A. A. (Windsor)

    Waterhouse Captain Charles

    Price, Major C. W. M.

    Spender-Clay, Colonel H.

    Watson, sir F. (Pudsey and Otley)

    Radford, E. A.

    Sprot, Sir Alexander

    Watson, Rt. Hon. W. (Carlisle)

    Ramsden, E

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Wells, S. R.

    Rawson, Sir Cooper

    Steel, Major Samuel Strang

    Wheler, Major Sir Granville C. H.

    Rhys, Hon. C. A. U.

    Stuart, Hon. J. (Moray and Nairn)

    Williams, A. M. (Cornwall, Northern)

    Rice, Sir Frederick

    Styles, Captain H. W.

    Williams, Com. C. (Devon, Torquay)

    Robinson, Sir T. (Lanes, Stretford)

    Sueter, Rear-Admiral Murray Fraser

    Williams, Herbert G. (Reading)

    Russell, Alexander West (Tynemouth)

    Sykes, Major-Gen. Sir Frederick H.

    Windsor-Clive, Lieut.-Colonel George

    Samuel, A. M. (Surrey, Farnham)

    Tasker, R. Inigo.

    Winterton, Rt. Hon. Ears

    Sandeman, N. Stewart

    Templeton, W. P.

    Wise, Sir Fredric

    Sanders, Sir Robert A.

    Thom, Lt.-Col, J. G. (Dumbarton)

    Withers. John James

    Sanderson, Sir Frank

    Thompson, Luke (Sunderland)

    Womersley, W. J.

    Sandon, Lord

    Thomson, F. C. (Aberdeen, S.)

    Wood, Sir S. Kill-(High Peak)

    Sassoon, Sir Philip Albert Gustave D.

    Titchfield, Major the Marquess of

    Worthington-Evans, Rt. Hon. Sir L.

    Savery, S. S.

    Tryon, Rt. Hon. George Clement

    Young, Rt. Hon. Sir Hilton (Norwich)

    Scott, Rt. Hon. Sir Leslie

    Vaughan-Morgan. Col. K. P.

    Shepperson, E. W.

    Wallace, Captain D. E.

    TELLERS FOR THE AYES—

    Skelton, A. N.

    Ward. Lt. -Col. A. L. (Kingston-on. Hull)

    Major Sir George Hennessy and

    Smith, R. W. (Aberd'n & Kinc'dlne, C. )

    Warner, Brigadier General W. W.

    Captain Viscount Curzon.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Hamilton, Sir R. (Orkney & Shetland)

    Roberts, RT. Hon. F. O. (W. Bromwich)

    Alexander, A. V. (Sheffield, Hillsbro')

    Hardie, George D.

    Robinson, W. C. (Yorks, W. R., Elland)

    Baker, Walter

    Harris, Percy A.

    Rose, Frank H.

    Barker, G. (Monmouth, Abertillary)

    Hayday, Arthur

    Scrymgeour, E.

    Barnes, A.

    Hayes, John Henry

    Scurr, John

    Batey, Joseph

    Henderson, Right Hon. A. (Burnley)

    Shepherd, Arthur Lewis

    Bondfield, Margaret

    Henderson, T. (Glasgow)

    Sinclair, Major Sir A. (Caithness)

    Bowerman, Rt. Hon. Charles W.

    Hirst, G. H.

    Smillie, Robert

    Briant, Frank

    Hirst, W. (Bradford, South)

    Smith, Ben (Bermondsey, Rotherhithe)

    Broad, F. A.

    Hudson, J. H. (Huddersfield)

    Smith, H. S. Lees (Keighley)

    Brown, Ernest (Leith)

    Jenkins, W. (Glamorgan, Neath)

    Smith, Rennie (Penistone)

    Brown, James (Ayr and Bute)

    John, William (Rhondda, West)

    Snell, Harry

    Buxton, Rt. Hon. Noel

    Johnston, Thomas (Dundee)

    Snowden, St. Hon. Philip

    Charleton, H. C.

    Jones, Henry Haydn (Merioneth)

    Spencer, G. A. (Broxtowe)

    Clowes, S.

    Jones, J. J. (West Ham, Silvertown)

    Spoor, Rt. Hon. Benjamin Charles

    Cluse, W. S.

    Jones, Morgan (Caerphilly)

    Stamford, T. W.

    Clynes, Rt. Hon. John R.

    Kelly, W. T.

    Stephen. Campbell

    Connolly, M.

    Kennedy, T.

    Stewart, J. (St. Rollox)

    Cowan, D. M. (Scottish Universities)

    Kenworthy, Lt.-Com. Hon. Joseph M.

    Strauss, E. A.

    Crawfurd, H. E.

    Kirkwood, D.

    Thomas, Pt. Hon. James H. (Derby)

    Dalton, Hugh

    Lansbury, George

    Thorne, W. (West Ham, Plaistow)

    Davies, Rhys John (Westhoughton)

    Lawrence, Susan

    Thurtle, Ernest

    Day, Colonel Harry

    Lee, F.

    Townend, A. E.

    Dennison, R

    Lindley, F. W.

    Vlant, S. P.

    Duckworth, John

    Lowth, T.

    Wallhead, Richard C.

    Dunnico, H.

    Lunn, William

    Watts-Morgan, Lt. -Col. D. (Rhondda)

    Edwards, J. Hugh (Accrington)

    Mackinder, W.

    Wedgwood. Rt. Hon. Josiah

    England, Colonel A.

    MacLaren, Andrew

    Wellock, Wilfred

    Evans, Capt. Ernest (Welsh Univer.)

    Macpherson, Rt. Hon. James I.

    Welsh, J. C.

    Fenby, T. D.

    March, S.

    Wiggins, William Martin

    Forrest, W.

    Montague, Frederick

    Williams, C. P. (Denbigh, Wrexham)

    Gardner, J. P.

    Morrison, R. C. (Tottenham, N.)

    Williams, David (Swansea, E.)

    Garro-Jones, Captain G. M.

    Mosley, Oswald

    Williams, Dr. J. H. (Lianelly)

    Gibbins, Joseph

    Murnin, H.

    Wilson, C. H. (Sheffield, Attercliffe)

    Gillett, George M.

    Naylor, T. E.

    Wilson, R. J. (Jarrow)

    Gosling, Harry

    Palin, John Henry

    Windsor, Walter

    Greenwood, A. (Nelson and Colne)

    Pethick-Lawrence, F. W.

    Wright, W.

    Grenfell, D. R. (Glamorgan)

    Ponsonby, Arthur

    Groves, T.

    Potts, John S.

    TELLERS FOR THE NOES.—

    Grundy, T. W.

    Purcell, A. A.

    Mr. Charles Edwards and Mr. Whiteley

    Hall, F. (York., W. R., Normanton)

    Riley, Ben

    Hall, G. H. (Merthyr Tydvil)

    Ritson. J.

    Motion made, and Question put, "That the Clause stand part
    of the Bill."

    Division No. 215.]

    AYES.

    [5. 8p. m.

    Acland-Troyte, Lieut.-Colonel

    Barclay-Harvey, C. M.

    Brass, Captain W.

    Agg-Gardner, Rt. Hon. Sir James T.

    Barnston, Major Sir Harry

    Brassey, Sir Leonard

    Ainsworth, Major Charles

    Beckett, Sir Gervase (Leeds, N.)

    Brittain, Sir Harry

    Aibery, Irving James

    Bennett, A. J.

    Brooke. Brigadier-General C. R. J.

    Alexander. E. E. (Leyton)

    Berry, Sir George

    Broun-Lindsay, Major H.

    Applin, Colonel R. V. K.

    Blundell, F. N.

    Brown, Brig.-Gen. H. C. (Berks, Newb'y

    Apsley, Lord

    Boothby, R. J. G.

    Buchan, John

    Ashley, Lt.-Col. Ht. Hon. Wilfrid W.

    Bourne, Captain Robert Croft

    Buckingham, Sir H.

    Astor, Viscountess

    Bowyer, Captain G. E. W.

    Bullock, Captain M.

    Balniel, Lord

    Braithwaite, Major A. N.

    Burman, J. B.

    The Committee divided: Ayes, 224; Noes, 120.

    Burney, Lieut.-Com. Charles D.

    Harvey, G, (Lambeth, Kennington)

    Preston, William

    Butler, Sir Geoffrey

    Harvey, Major S. E. (Devon, Totnes)

    Radford, E. A.

    Cadogan, Major Hon. Edward

    Haslam, Henry C.

    Raine, Sir Walter

    Calne, Gordon Hall

    Hawke, John Anthony

    Ramsden, E.

    Campbell, E. T.

    Headlam, Lieut.-Colonel C. M.

    Rawson, Sir Cooper

    Cayzer, Sir C. (Chester, City)

    Heneage, Lieut. -Col. Arthur P.

    Rhys, Hon. C. A. U.

    Cayzer, Maj. Sir Herbt. H. (Prtsmth, S.)

    Hennessy, Major J. R. G.

    Rice, Sir Frederick

    Cazalet, Captain Victor A.

    Hills, Major John Waiter

    Robinson, Sir T. (Lancs, Stretford)

    Cecil, Rt. Hon. Sir Evelyn (Aston)

    Hilton, Cecil

    Russell, Alexander West (Tynemouth)

    Chadwick, Sir Robert Burton

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Samuel, A. M. (Surrey, Farnham)

    Chapman, Sir S.

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Sandeman, N. Stewart

    Christie, J. A.

    Hohler, Sir Gerald Fitzroy

    Sanders, Sir Robert A.

    Churchill, Rt. Hon. Winston Spencer

    Holt, Captain H. P.

    Sanderson, Sir Frank

    Churchman, Sir Arthur C.

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Sandon, Lord

    Cobb, Sir Cyril

    Hope, Sir Harry (Forfar)

    Sassoon, Sir Philip Albert Gustave D.

    Cochrane, Commander Hon. A. D.

    Hopkins, J. W. W.

    Savery. S. S.

    Cockerill, Brig.-General Sir George

    Hopkinson, Sir A. (Eng. Universities)

    Scott, Rt. Hon. Sir Leslie

    Colfox, Major Wm. Philip

    Hopkinson, A. (Lancaster, Mossley)

    Shepperson, E. W.

    Conway, Sir W. Martin

    Home, Rt. Hon. Sir Robert S.

    Skelton, A. N.

    Cooper, A. Duff

    Howard-Bury, Lieut.-Colonel C. K.

    Smith, R. W.(Aberd'n & Kinc'dine, C.)

    Courthope, Colonel Sir G. L.

    Hudson, R. S. (Cumberland, Whlteh'n)

    Smith-Carington, Neville W.

    Craig Sir Ernest (Chester, Crewe)

    Huntingfield, Lord

    Somerville, A. A. (Windsor)

    Crookshank, Col. C. de W. (Berwick)

    Hurd, Percy A.

    Spender-Clay, Colonel H.

    Crookshank, Cpt. H. (Lindsey, Gainsbro)

    Hurst, Gerald B.

    Sprot, Sir Alexander

    Curzon, Captain Viscount

    Inskip, Sir Thomas Walker H.

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Dalkeith Earl of

    Jackson, Sir H. (Wandsworth, Cen'l)

    Steel, Major Samuel Strang

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    Jacob, A. E.

    Stuart, Crichton-, Lord C.

    Davies Sir Thomas (Cirencester)

    James, Lieut.-Colonel Hon. Cuthbert

    Stuart, Hon. J. (Moray and Nairn)

    Davies, Dr. Vernon

    Jephcott, A. R.

    Styles, Captain H. W.

    Dean, Arthur Wellesley

    Kidd. J. (Linlithgow)

    Sueter, Rear-Admiral Murray Fraser

    Dixon, Captain Ht. Hon. Herbert

    King, Commodore Henry Douglas

    Sykes, Major-Gen, Sir Frederick H.

    Drewe C.

    Kinloch-Cooke, Sir Clement

    Tasker, R. Inigo.

    Eden, Captain Anthony

    Knox Sir Alfred

    Templeton. W. P.

    Edmondson, Major A. J.

    Lane Fox Col- Rt. Hon-George R.

    Thom, Lt.-Col. J. G. (Dumbarton)

    Ellis R. G.

    Leigh, Sir John (Clapham)

    Thompson, Luke (Sunderland)

    Elveden, Viscount

    Lister, Cunliffe, Rt. Hon. Sir Philip

    Thomson, F. C. (Aberdeen, South)

    Erskine Lord (Somerset, Weston-s-M.)

    Locker-Lampson, G. (Wood Green)

    Titchfield, Major the Marquess of

    Evans Captain A. (Cardiff, South)

    Long-Major Eric

    Tryon, Hon. George Clement

    Everard, W. Lindsay

    Looker, Herbert William

    Vaughan-Morgan, Col. K. P.

    Falle, Sir Bertram G.

    Luce Maj. -Gen. Sir Richard Harman

    Wallace. Captain D. E.

    Fermoy Lord

    Lumley, L. R.

    Ward. Col. J. (Stoke-upon-Trent)

    Fielden E. B.

    Lynn, Sir R. J.

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Finburgh, S.

    Macdonald, Capt. P. D. (I. of W.)

    Warner, Brigadier-General W. W.

    Ford, Sir P. J.

    Macdonald, R. (Glasgow, Cathcart)

    Warrender, Sir Victor

    Forestier-Walker, Sir L.

    McLean, Major A.

    Waterhouse, Captain Charles

    Foster, Sir Harry S.

    Macmilllan, Captain H.

    Watson, Sir F. (Pudsey and Otley)

    Foxcroft Captain C T

    Macnaghten, Hon. Sir Malcolm

    Watson, Rt. Hon. W. (Carlisle)

    Fraser Captain Ian

    McNeill, Rt. Hon. Ronald John

    Wells, S. R.

    Fremantie, Lieut.-Colonel Francis E.

    Malone, Major P. B.

    Wheler, Major Sir Granville C. H.

    Ganzonl. Sir John

    Manningham-Buller, sir Mervyn

    Williams, A. M. (Cornwall, Northern)

    Gates, Percy

    Margesson, Captain D.

    Williams, Com. C. (Devon, Torquay)

    Gault, Lieut.-Col. Andrew Hamilton

    Marriott, Sir J. A. R.

    Williams, Herbert G. (Reading)

    Gibbs, Col. Rt. Hon George Abraham

    Meyer, Sir Frank

    Windsor-Clive, Lieut.-Colonel George

    Glimour, Lt. Col. Rt. Hon. Sir John

    Mitchell, S. (Lanark, Lanark)

    Winterton Ht. Hon. Ear.

    Glyn Major R. G. C.

    Mitchell, W. Foot (Saffron Walden)

    Wise, Sir Fredric

    Grace, John

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Withers, John James

    Grattan-Doyle Sir N

    Moore, Lieut-Colonel T. C. R. (Ayr)

    Womersley, W. J.

    Greene, W. P Crawford

    Moreing, Captain A. H.

    Wood, B. C. (Somerset, Bridgwater)

    Grenfell, Edward C. (City of London)

    Murchison, Sir Kenneth

    Wood, Sir Kingsley (Woolwich. W.)

    Gretton, Colonel Rt. Hon. John

    Nelson, Sir Frank

    Wood, Sir S. Hill-(High Peak)

    Grotrian, H. Brent

    Newman, Sir R. H. S. D. L. (Exeter)

    Worthington-Evans, Rt. Hon. Sir L.

    Gunston, Captain D. W.

    Nicholson, Col. Rt. Hon. W. G. (Ptrsf'ld. )

    Young, Rt. Hon. Sir Hilton (Norwich)

    Hacking, Captain Douglas H.

    Oman, Sir Charles William C.

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Percy, Lord Eustace (Hastings)

    TELLERS FOR THE AYES.—

    Harrison, G. J. C.

    Perkins, Colonel E. K.

    Major Cope and Mr. Penny.

    Hartington, Marquess of

    Pownail, Sir Assheton

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Cluse, W. S.

    Fenby, T. D.

    Alexander, A. V. (Sheffield, Hillsbro')

    Clynes, Rt. Hon. John B.

    Forrest, W.

    Baker, Walter

    Connolly, M,

    Gardner, J. P.

    Barker, G. (Monmouth, Abertillery)

    Cowan, D. M. (Scottish Universities)

    Garro-Jones, Captain G. M.

    Barnes, A.

    Crawfurd, H. E.

    Gibbins, Joseph

    Batey, Joseph

    Dalton, Hugh

    Gillett, George M.

    Bondfield, Margaret

    Davies, Rhys John (Westhoughton)

    Gosling, Harry

    Sowerman, Rt. Hon. Charles W.

    Day, Colonel Harry

    Greenwood, A, (Nelson and Colne)

    Briant, Frank

    Dennison, R.

    Grenfell, D. R. (Glamorgan)

    Broad, F. A.

    Duckworth John

    Groves. T.

    Brown, Ernest (Leith)

    Dunnico, H.

    Grundy, T. W.

    Brown, James (Ayrand Bute)

    Edwards, C. (Monmouth, Bedwellty)

    Hall, F. (York, W. R., Normanton)

    Buxton, Rt. Hon. Noel

    Edwards, J. Hugh (Accrington)

    Hall, G. H. (Merthyr Tydvil)

    Charleton, H. C.

    England, Colonel A.

    Hamilton, Sir R. (Orkney & Shetland)

    Clowes, S.

    Evans, Capt. Ernest (Welsh Univer.)

    Hardie, George D.

    254

    255

    Harris, Percy A.

    Montague, Frederick

    Spoor, Rt. Hon. Benjamin Charley

    Mayday, Arthur

    Morrison, R. C. (Tottenham, N.)

    Stamford, T. W.

    Henderson, Rt. Hon. A. (Burnley)

    Mosley, Oswald

    Stephen, Campbell

    Henderson, T. (Glasgow)

    Murnin, H.

    Stewart, J. (St. Rollox)

    Hirst, G. H.

    Naylor, T. E.

    Strauss, E. A.

    Hirst, W. (Bradford, South)

    Palin, John

    Henry Thomas, Rt. Hon. James H. (Derby)

    Hudson, J. H. (Huddersfield)

    Pethick-Lawrence, F. W.

    Thorne, W. (West Ham, Plaistow)

    Jenkins, w. (Glamorgan, Neath)

    Ponsonby, Arthur

    Thurtie, Ernest

    John, William (Rhondda, West)

    Potts, John S.

    Townend, A. E.

    Johnston, Thomas (Dundee)

    Purcell, A. A.

    Viant, S. P.

    Jones, Henry Haydn (Merioneth)

    Riley, Ben

    Wallhead, Richard C.

    Jones, J. J. (West Ham, Silvertown)

    Ritson, J.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Jones, Morgan (Caerphilly)

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Wedgwood, Rt. Hon. Josiah

    Kelly, W. T.

    Robinson, W. C. (Yorks, W. R., Elland)

    Wellock, Wilfred

    Kennedy, T.

    Rose, Frank H.

    Welsh, J. C.

    Kenworthy, Lt.-Com. Hon. Joseph M.

    Scrymgeour, E.

    Wiggins, William Martin

    Kirkwood, D.

    Scurr, John

    Williams, C. P. (Denbigh, Wrexham)

    Lansbury, George

    Shepherd, Arthur Lewis

    Williams, David (Swansea, East)

    Lawrence, Susan

    Sinclair, Major Sir A. (Caithness)

    Williams, Dr. J. H. (Lianelly)

    Lindley, F. W.

    Smile, Robert

    Wilson, C. H. (Sheffield, Attercliffe)

    Lowth, T.

    Smith, Ben (Bermondsey, Rotherhithe)

    Wilson, R. J. (Jarrow)

    Lunn, William

    Smith, H. B. Lees (Keighley)

    Windsor, Walter

    Mackinder, W.

    Smith, Rennie (Penistone)

    Wright, W.

    MacLaren, Andrew

    Snell, Harry

    Macpherson, Rt. Hon. James I.

    Snowden, Rt. Hon. Philip

    TELLERS FOR THE NOES—

    March, S.

    Spencer, G. A. (Broxtowe)

    Mr. Whiteley and Mr. Hayes.

    CLAUSE 2.—(Additional medicine duties.)
    Sir ROBERT HAMILTON: I beg to move, in page 2, to leave out from the word "charged," in line 11, to the end of the Clause, and to insert instead thereof the words, "until the first day of August, nineteen hundred and twenty-eight."
    We had a short discussion on this duty during the Budget Resolutions, and it was brought to our notice that the duty which is now existing was doubled in 1915, as a purely war measure. It is now proposed that that should be the duty for all time, and that it should not be brought up for annual review, as we think it should be. We have to remember that this is a duty on medicines, and that is a very important fact. You may call them patent medicines, you may call them quack medicines, but they are medicines, which the people of this country buy and use in very large quantities indeed, and it is mostly the poor who buy them. It is a duty with a very long history, with which I do not intend to weary the Committee now, but before the War it was a comparatively small duty. It was, as I say, doubled in 1915, and I think the Chancellor of the Exchequer told us that £1,340,000 is the exact estimate of the sum that it is to bring in for the coming year. That is a very considerable sum, and we know that the Chancellor of the Exchequer, who has got into difficulties with his Budget, owing to a variety of causes, would find the loss of £1,340,000
    256
    at the present time very considerable, and one which would have to be replaced from some other quarter.
    Our Amendment, therefore, proposes that this duty should come up for review again next year and should not be made permanent. Hitherto, it has come up for review from time to time, but when the Financial Secretary to the Treasury was asked, in the course of the Budget Resolutions Debate the other day, why it was now going to be made permanent, he said that it was vexatious that the duty should be carried on from year to year without people knowing whether or not it was going to be made permanent. I should like to ask why we should make this duty, which was doubled for war purposes, permanent. Why should we tuck it away in a corner, not to come up for annual review, when we bear in mind, as we ought to bear in mind, whatever views individuals may have about the use of quack medicines, that millions of our poor countrymen use them, and use them with advantage? I do not suppose there is an hon. Member of this Committee who does not use, or has not used, or will not use, at some time in his life, one of these patent or quack medicines, whether as a lotion, an ointment, or a pill.
    The whole world uses them, and, of course, that is a reason that was put forward from the Treasury Bench for taxing them. They bring in a very good revenue, but that was a most extraordinary argument used by the Financial Secretary the other day, when he said that during the last Three years the duty

    257
    had gone up by nearly four times and that, therefore, it was a legitimate source of revenue. What an extraordinary argument, that because a thing that everybody uses, and most people want, will stand a high tax, therefore it is a legitimate source of revenue. That could be an argument for taxing bread or meat. It is perfectly true that these patent medicines have stood this extra duty and have brought in a large sum, but how? By the extra cost to the consumers. We have all had to pay more for our medicines. I want to impress upon the Committee all the time that no civilised country to-day is without these medicines. They may be good or bad medicines; they may cure by faith or by some obscure element in them which is secret, but, For all that, they are medicines which we are taxing, and I think I can confidently ask the Committee to support this Amendment, which will prevent this tax being kept on for all time and ensure that it will be brought up for review later on.
    In the discussion the other day, I could not understand whether or not the Financial Secretary meant that the tax should be raised so as to deter the use of these medicines. He spoke of them as being quack medicines, and I think he said it had always been regarded as a tax on quack medicines. Of course, you can deter people from using them by putting the tax so high as to put it beyond the power of the poor to use them, but I do not suppose the right hon. Gentleman intends to do that. What is the principle on which these medicines are taxed? Is it in order to deter people from using them, is it in order to bring in revenue, or is it in some way to help the legitimate kind of doctor? It has always seemed to me rather a curious tax, and, therefore, I confidently commend my Amendment to the consideration of the Committee.
    The FINANCIAL SECRETARY to the TREASURY (Mr. Ronald McNeill): I am afraid that, notwithstanding what the hon. Member for Orkney and Shetland (Sir R. Hamilton) has said, I must beg leave to repeat the argument which he thinks was absurd. I have always under- stood that it was more or less an axiom of taxation that, when you find that a tax is not in any way decreasing the consumption, but that, on the contrary, in spite of the tax, there is a large and
    258
    increasing consumption, it was usually taken as a. proof that there is nothing oppressive in the tax. The hon. Gentleman has used an argument which is always applicable to indirect taxation of any kind. He says that the tax is derived from the consumer, and, of course, it is. This tax really is not one that falls in any true and wide sense upon medicine as understood at the present day, because there is an exemption, as the lion. Member knows, Any medicine which comes under the heading of a regular medicine recommended by a doctor escapes the tax. I quite admit, as I have admitted before, that this is a very old duty, and that it is an anomalous duty in many respects. It comes down from the eighteenth century, and I quite agree that, if we were devising de novo an ideal fiscal system, it is very likely that this particular duty would not find a place in it, but, as a matter of fact, it has been, and is, regarded by the public and the traders concerned as entirely unobjectionable, and the only question which is raised in this Amendment is whether the additional duty put on during the War is or is not to be upon a permanent basis.
    The hon. Gentleman said that, whether it is good or bad, it ought not to be tucked away and put on a permanent basis. But the original tax is on a permanent basis. The only question which has to be debated each year is whether this additional amount put on during the War is or is not to continue. I repeat that as, to all intents and purposes, it is, and is likely to remain on a permanent basis, it really becomes an absurdity that half the duty should be placed upon an annual basis and the other half upon a permanent basis. As I have said previously, I think that is vexatious. We cannot, so far as the present year is concerned, do without the revenue, and, in fact, the hon. Gentleman does not propose that we should. All that he proposes is that we should debate the duty again next year. Of course, if the hon. Gentleman or anyone else thinks next year that the time has come for it to disappear, it is quite easy for him to bring it up in the discussion on the Finance Bill next year.
    Sir R. HAMILTON Sir R. HAMILTON indicated dissent.
    Mr. McNEILL: The hon. Gentleman shakes his head, but he is wrong. All that he has to do is to put down a new Clause next year, and then it can be discussed in exactly the same way as if it came up annually. The only difference is that unless some hon. Member positively wants to raise the discussion in that way, it will not have to be put down as a matter of course, and a Clause passed in order to perpetuate or to continue for another year one half of a duty the other half of which is permanent. Therefore, I must ask the Committee to reject the Amendment.
    Mr. HARRIS: I was rather surprised at the line which the right hon. Gentleman has taken. He admits right away that he would not defend this tax as the kind of tax that he would impose if he were arranging for his ideal Budget. What we want is that this tax should not be hidden away from the public gaze. It is a very dangerous thing if taxes are imposed that the public are not conscious of paying. With a little tax of this kind, people come in and buy medicines, and they are not conscious that they are, at the same time, paying a contribution towards the revenue. That is thoroughly unsound. It is the kind of taxation which stimulates and encourages extravagance. But there is another reason, which is more important, why we should review this tax next year and not make it permanent. This is a War tax, and it is a very remarkable thing that practically all the new taxes imposed during the War as temporary measures to meet an emergency have been retained by the Government. Reference has been made to the McKenna Duties. Having sneaked them through in War time, they have taken advantage of them and kept them permanently on the Statute Book, mid here is another irritating tax, imposed in an emergency, to meet a national crisis, to bring in revenue for War purposes, which is now to be kept on permanently by the Government.
    The Government have been so extravagant and wasteful and incompetent that they have had to scratch for money wherever they could get it, from any corner, in order to make their Budget balance. The right hon. Gentleman says that next year we can put down a new Clause, but he knows very well that the
    260
    Chancellor of the Exchequer would probably tell the House that he had made his arrangements for the financial year, that he had to balance his Budget, and that, if we knocked off half-a million or whatever the additional duty might be, his Budget would be spoiled and he would not save his balance. That is a very plausible excuse. We want to tell the Chancellor of the Exchequer that next year he must reconsider the whole position. There is a feeling in the House that this is an irritating, a foolish, an out-of-date, and an unwise tax, and, I believe, the Financial Secretary to the Treasury thinks that it is an irritating, a foolish, an out-of-date, and an unwise tax. It is only because the country is so hard-up that we have to raise revenue in this particular way.
    When we considered this matter on the Budget Resolutions, the right hon. Gentleman told me that he had a Departmental Committee who solemnly sat and considered these duties, whether they were intelligible and whether their form should be altered. He told us that after they had sat for some considerable time they came to the conclusion they could not exclude the words of the Act of 1812. I looked up the Act. I do think that Members of this Committee have a responsibility to their constituents to look up the Act of Parliament under which the revenue of the country is raised. This Act of 1812 in a very interesting historical document, but, really, seriously to suggest that it provides words suitable for raising revenge is stretching the imagination a good deal. I have no doubt that the Committee was composed of members with a strong historical sense and who liked old-fashioned phraseology, and that they were not very anxious to do lawyers out of a job by making matters clear. The people who framed that Act were, to do them justice, very anxious to make the people understand what articles were to be taxed. Here are four pages of patent medicines advertised as taxable, and I venture to say that not one in 10 of them can be bought in any chemist's or grocer's shop in this country. Here they are:
    "Adams's Solvent Addison's Re-animating European Balsam, Aetherial Aanodyne Spirit."
    and soon, column after column, ending with "Zimmerman's Stimulating Fluid."

    261
    I would not mind offering a prize to any Member of this Committee who can buy any of these articles that the Committee of 1812 put on the list in order that the public should know whether a particular article was taxable or not. Are we sure that Beecham's pills and Enos fruit salts are rightly being taxed under the Act of 1812? It is true that at the very end of the Act, stowed away in the last Section, are some special exemptions—all drugs named or contained in the Book of hates subscribed with the name of Sir Harbottle Grimstone. I believe the hon. Baronet was a distinguished member of this House. I am not quite clear on this point, but I have no doubt that some of my medical friends will be able to tell me that this particular book is recognised as an authority on medicines. Anyhow, his medicines are excluded from taxation. Then there is a great number of additional articles, under which, I understand, the right hon. Gentleman takes refuge. It is the Section at the end of the long list of articles on the four pages referred to. It reads as follows:
    "And also all other pills, powders, lozenges, tinctures, potions, cordials, electuaries and so on"—
    I do not want to weary the Committee by mentioning all of them—[HON. MEMBERS: "Go onexcl; "]—
    "made, prepared, uttered, vended, or exposed to sale by any person or persons whatsoever, wherein the person making, preparing, uttering, vending, or exposing for sale the same, hath or claims to have any occult secret or art for the making or preparing the same."
    I very much doubt whether it is legal to advertise under our present law that an article is made under an occult secret. I would suggest to the Committee that it is impossible to use that kind of wording to justify the raising of additional taxes in 1927. It is a very doubtful direction to this House. It goes on to say:
    "Or hath or claims to have any exclusive right or title to the making or preparing the same, or which have at any time heretofore been, now are or shall hereafter be prepared, uttered, vended or exposed to sale under the authority of any Leters Patent under the Great Seal."
    The DEPUTY-CHAIRMAN: This is not a question which is before the Committee.
    Mr. HARRIS: What I am showing is, that before we make this tax permanent, the Committee should be quite clear that the words governing the tax are on sound principles and intelligible to the public. I most respectfully submit that these words are out of date. I pressed last year, and also on the Budget Resolutions, for new words to be provided. This the Financial Secretary admitted, but, apparently, his Committee came to the conclusion that these words are clear. Having read them to the Committee—and after all we are the chosen of the country, and we are the most intelligent members of the public—I doubt whether the words are clear even to the majority of this Committee. At any rate, they are very complicated and involved. There is only one more sentence with which I should like to trouble the Committee. First, they must either be the result of occult secret or art or produced under Letters Patent,
    "or which have at any time heretofore been, now are or shall hereafter be by any public notice or advertisement, or by any written or printed papers or hand bills, or by any label or words written or printed, affixed to, or delivered with any packet, box, bottle, phial or other in closure containing the same, held out or recommended to the public."
    I submit that to make, a tax of this kind permanent under words of this kind is not only an insult to the Committee, but is treating taxation in a light and frivolous manner. My remarks have caused a certain amount of amusement, but, after all, this is not the way to raise revenue in this country at a time like this. I would suggest to the Financial Secretary to the Treasury that if we are to have this tax, he should give an undertaking next year to reconsider the whole matter, that the words governing the imposition of the tax should be redrafted, and that another Clause should be put in the Finance Bill of next year. I do not suggest that it should be done this year. We do not want to be unreasonable. We are prepared to wait until 1928 with patience. But I do not think the right hon. Gentleman is justified in asking this Committee to impose this tax under an Act passed in 1812, the words of which are out of date and hardly intelligible to the general public.
    Commander WILLIAMS: I do not propose to follow the hon. Gentleman into

    263
    the realms of occult science or in regard to the wording of an Act of Parliament of 1812. I have no doubt that past history rather than looking forward to the future may be of more interest to his party than it is, possibly, to my party. [Interruption.] At any rate, our future is not concerned with occult science. Our future is absolutely assured for many years in this House. I have no doubt Gentlemen on the other side of the Committee dwell on these old Measures because they are more cheerful. I want to say one or two words about this Clause, which is of very great interest from many points of view. Personally, I am not interested in medicines of any kind. I am not at all sure whether there are not almost as many people in this country, if not more, injured through drinking medicines as there are through drinking other beverages.
    The DEPUTY-CHAIRMAN: The question before the Committee is whether the tax should be permanent or temporary, and has nothing to do with the quality of the medicines.
    Commander WILLIAMS: I want to be clear whether, in making this permanent, as we are to-day, the Chancellor of the Exchequer is doing something which many of us believe may possibly be a handicap in the future to a particular line of thought and argument. I believe that this putting of Excise Duties on to a great number of articles manufactured in England, is, on the whole, one to be deprecated. I would like to ask the Financial Secretary to the Treasury if, in discussing the Budget for another year, he will see whether it is not possible to put rather more duty on foreign articles coming in to compete with us, and rather less Excise Duty on British-made medicine, which is of a much higher quality and much more useful. Apparently, all parties except the Liberal party are agreed that this duty shall be made permanent. I conclude that the Socialist party are in agreement with the proposal, because they do not appear to be very interested in the subject. I would ask the Financial Secretary that one simple question, whether, in going into the matter another year, it will not be
    264
    possible to lower the existing duty on British medicines and tighten up the duty on foreign medicines, and whether, before we pass this Clause, he will give the Committee a definite assurance that by passing this Clause it will not be more difficult to get that preference in the near future?
    Sir HILTON YOUNG: There is, I think, a principle involved in this Amendment, and as it is raised by a series of Amendments from the benches opposite, it may be worth a single brief reference. The proposal is, that this duty should be re-debated annually. Is it not worth while reminding ourselves that the general structure of our financial organisation is that taxes and duties are permanent enactments, and that two only are reserved for annual reconsideration in order to give the House of Commons the opportunity, in short, of imposing its will upon the Executive? Those two which are reserved for annual re-enactment are one great direct tax, the Income Tax, and one great indirect, tax, the Tea Duty. It is very important in the interest of the trader that he should not be cast into annual doubt as to the basis upon which he is to make his prices during the coming year. It is in the interests of this House—it is surely common sense—that it should not be called upon to re-debate annually more subjects than it need debate. It tends to overwhelm the proceedings of this House with, at any rate, opportunities for discussions which are apt to lead us aside and possibly into discussions which are not, perhaps, vital to the business of the nation.
    Finally, one word en the need of the principle which underlies this duty and which, I think, is so strong that it has strength enough to establish the duty as a permanent duty. One is not, perhaps, in favour of small fancy taxes. With regard to this particular tax, no doubt very large profits are made by vendors of patent medicines, and very largely from the credulity and ignorance of their fellow countrymen. Either the patent medicine, as sold, is worth nothing or contains nothing which is not in the ordinary pharmacopœa. In that case, the unfortunate purchaser has paid 10 times the amount the article is worth and it is quite just that the vendor should make

    265
    some contribution to the revenue. In those cases where there is some special knowledge or secret of manufacture contained in the article sold it is surely in the public interest that the secret knowledge should be at the disposal of the whole medical profession, and if it is not put at the disposal of the whole medical profession then it is right that the vendor should pay for this retention of useful knowledge from the public generally.
    Mr. E. BROWN: I am surprised that the hon. and gallant Member for Torquay (Commander Williams) should take the question of patent medicines lightly. There was an old-fashioned vendor of patent medicines in the West Country who used to sing this song:
    "There be fifty cures for every ill,
    And each one be the best;
    You can drink them down, or rub them in,
    Or lay them on your chest."
    Up to recent times, in the hon. and gallant Member's own constituency, there has been a vendor of a particular herb medicine which would be taxed under this provision. It has brought relief to some of the hon. and gallant Member's constituents when the medical profession have been unable to do so. He, therefore, should be careful what he says about patent medicines in this House. We always receive with respect what the right hon. Member for Norwich (Sir Hilton Young) has to say on the general structure of the financial system of this country, but when he stresses the interests of the traders in this matter, I must point out that there are also the

    Division No. 216.]

    AYES.

    [5. 50 p. m.

    Acland-Troyte, Lieut.-Colonel

    Brassey, Sir Leonard

    Churchman, Sir Arthur C.

    Agg-Gardner, Rt. Hon. Sir James T

    Brittain, Sir Harry

    Cobb, Sir Cyril

    Ainsworth, Major Charles

    Brooke, Brigadier-General C. R. I.

    Cochrane, Commander Hon. A. D.

    Albery, Irving James

    Broun-Lindsay, Major H.

    Cockerill, Brig.-General Sir George

    Alexander, E. E. (Leyton)

    Brown, Brig.-Gen. H. C. (Berks, Newb'y)

    Colfox, Major Wm. Phillips

    Amery, Rt. Hon. Leopold C. M. S.

    Buchan, John

    Conway, Sir W. Martin

    Applin, Colonel R. V. K.

    Buckingham, Sir H.

    Cooper, A. Duff

    Apsley, Lord

    Bullock, Captain M.

    Courthope, Colonel Sir G. L.

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Burman, J. B.

    Craig, Sir Ernest (Chester, Crewe)

    Astor, Viscountess

    Burney, Lieut.-Com. Charles D.

    Crooke, J. Smedley (Deritend)

    Balniel, Lord

    Butler, Sir Geoffrey

    Crookshank, Col. C. de W. (Berwick)

    Barclay-Harvey, C. M.

    Butt, Sir Alfred

    Crookshank, Cpt. H. (Lindsey, Gainsbro)

    Barnston, Major Sir Harry

    Cadogan, Major Hon. Edward

    Curzon, Captain Viscount

    Beamish, Rear-Admiral T. P. H.

    Caine, Gordon Hall

    Dalkeith, Earl of

    Beckett, Sir Gervase (Leeds, N.)

    Campbell, E. T.

    Davidson, Major-General Sir John H.

    Bennett, A. J.

    Cayzer, Sir C. (Chester, City)

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    Berry, Sir George

    Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)

    Davies, Sir Thomas (Cirencester)

    Betterton, Henry B.

    Cazalet, Captain Victor A.

    Davies, Dr. Vernon

    Blundell, F. N.

    Cecil, Rt. Hon. Sir Evelyn (Aston)

    Dean, Arthur Wellesley

    Boothby, R. J. G.

    Chadwick, Sir Robert Burton

    Dixon, Captain Rt. Hon. Herbert

    Bourne, Captain Robert Croft

    Chapman, Sir S.

    Drewe, C.

    Bowyer, Capt. G. E. W.

    Chilcott, Sir Warden

    Eden, Captain Anthony

    Braithwaite, Major A. N.

    Christie, J. A.

    Ellis, R. G.

    Brass, Captain W.

    Churchill, Rt. Hon. Winston Spencer

    Eiveden, Viscount

    interests of the consumers to be considered. The Committee will no doubt agree that if there is one set of duties which should come under annual review it is the series of duties imposed in time of war purely for war purposes. That is why we move this Amendment. A great deal of money is involved. These duties before the War brought in £360,000; according to the last return, that is the year before last, they brought in £1,290,000, and the amount is now about £1,344,000. We consider that our argument is quite sound and, although it is to the interests of the traders not to have great upsets each year, it is to the interests of the consumers to see that before a permanent basis of taxation is reached every single one of these irritating duties, most of which are indirect duties and come out of the purchasing power of the people, is brought under annual review. The Match Tax, which was imposed purely for war purposes, was never discussed from 1915 until this year. I agree with the right hon. Gentleman the Member for Norwich on the general point, but, in regard to these war duties, I think we are on firm ground in asking that before a permanent basis is reached they shall be brought under annual review, and shall not be missed in the discussions which are occasioned by the new Budget of the Chancellor of the Exchequer.
    Question put, "That the words proposed to be left out stand part of the Clause."
    The Committee divided: Ayes, 249; Noes, 125.

    Erskine, Lord (Somerset, Weston-s.-M.)

    Hutchison, G. A Clark (Midl'n & P'bl's)

    Robinson, Sir T. (Lancs, Stretford)

    Everard, W. Lindsay

    Inskip, Sir Thomas Walker H.

    Russell, Alexander West (Tynemouth)

    Fairfax, Captain J. G.

    Jackson, Sir H. (Wandsworth, Cen'l)

    Salmon, Major I.

    Falle, Sir Bertram G.

    Jacob, A. E.

    Samuel, A. M. (Surrey, Farnham)

    Fermoy, Lord

    James, Lieut.-Colonel Hon. Cuthbert

    Sandeman, N. Stewart

    Fielden, E. B.

    Jephcott, A. R.

    Sanders, Sir Robert A.

    Finburgh, S.

    Kidd, J. (Linlithgow)

    Sanderson, Sir Frank

    Ford, Sir P. J.

    Kindersley, Major Guy M.

    Sandon, Lord

    Forestier-Walker, Sir L.

    King Commodore Henry Douglas

    Sassoon, Sir Philip Albert Gustave D.

    Foster, Sir Harry S.

    Kinloch-Cooke, Sir Clement

    Savery, S. S.

    Foxcroft, Captain C. T.

    Knox, Sir Alfred

    Scott, Rt. Hon. Sir Leslie

    Fraser, Captain Ian

    Lamb, J. Q.

    Sheffield, Sir Berkeley

    Fremantle, Lieut.-Colonel Francis E.

    Lane Fox, Col. Rt. Hon. George R.

    Shepperson, E. W.

    Gadie, Lieut.-Col. Anthony

    Leigh, Sir John (Clapham)

    Simms, Dr. John M. (Co. Down)

    Ganzonl, Sir John

    Lister, Cunliffe-, Rt. Hon. Sir Philip

    Sinclair, Col. T. (Queen's Univ., Belfst.)

    Gates, Percy

    Locker-Lampson, G. (Wood Green)

    Skelton, A. N.

    Gault, Lieut.-Col. Andrew Hamilton

    Long, Major Eric

    Smith, R. W. (Aberd'n & Kinc'dine, C.)

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Looker, Herbert William

    Smith-Carington, Neville W.

    Glyn, Major R. G. C.

    Lowe, Sir Francis William

    Somerville, A. A. (Windsor)

    Goff, Sir Park

    Luce, Maj.-Gen. Sir Richard Harman

    Spender-Clay, Colonel H.

    Gower, Sir Robert

    Lumley, L. R.

    Sprot, Sir Alexander

    Grace, John

    Lynn, Sir Robert J.

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Grattan-Doyle, Sir N.

    Macdonald, Capt. P. D. (I. of W.)

    Steel, Major Samuel Strang

    Greaves-Lord, Sir Walter

    Macdonald, R. (Glasgow, Cathcart)

    Stuart, Crichton-, Lord C.

    Greene, W. P. Crawford

    McLean, Major A.

    Stuart, Hon. J. (Moray and Nairn)

    Greenwood, Rt. Hn. Sir H.(W'th's'w,E)

    Macmillan, Captain H.

    Styles, Captain H. W.

    Grenfell, Edward C. (City of London)

    Macnaghten, Hon. Sir Malcolm

    Sueter, Rear-Admiral Murray Fraser

    Gretton, Colonel Rt. Hon. John

    McNeill, Rt. Hon. Ronald John

    Sykes, Major-Gen. Sir Frederick H.

    Grotrian, H. Brent

    Makins, Brigadler-General E.

    Tasker, R. Inigo.

    Guinness, Rt. Hon. Walter E.

    Malone, Major P. B.

    Templeton, W. P.

    Gunston, Captain D. W.

    Manningham-Buller, Sir Mervyn

    Thom, Lt.-Col. J. G. (Dumbarton)

    Hacking, Captain Douglas H.

    Margesson, Captain D.

    Thompson, Luke (Sunderland)

    Harrison, G. J. C.

    Marriott, Sir J. A. R.

    Thomson, F. C. (Aberdeen, South)

    Hartington, Marquess of

    Meyer, Sir Frank

    Tinne, J. A.

    Harvey, G. (Lambeth, Kennington)

    Mitchell, S. (Lanark, Lanark)

    Titchfield, Major the Marquess of

    Harvey, Major S. E. (Devon, Totnes)

    Mitchell, W. Foot (Saffron Walden)

    Tryon. Rt. Hon. George Clement

    Haslam, Henry C

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Vaughan-Morgan, Col. K. P.

    Hawke, John Anthony

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Wallace, Captain D. E.

    Headlam, Lieut.-Colonel C. M

    Moreing, Captain A. H.

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Henderson, Capt. R. R. (Oxf'd, Henley)

    Murchison, Sir Kenneth

    Warner, Brinadier-General W. W.

    Heneage, Lieut.-Colonel Arthur P.

    Nelson, Sir Frank

    Warrender, Sir Victor

    Henn, Sir Sydney H.

    Newman, Sir R. H. S. D. L. (Exeter)

    Waterhouse, Captain Charles

    Hills, Major John Waller

    Nicholson, Col. Rt. Hn. W. G. (Ptrsf'l'd.)

    Watson, Sir F. (Pudsey and Otley)

    Hilton, Cecil

    Oman, Sir Charles William C.

    Watson, Rt. Hon. W. (Carlisle)

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Penny, Frederick George

    Wells, S. R.

    Hogg, Rt- Hon. Sir D. (St. Marylebone)

    Percy, Lord Eustace (Hastings)

    Wheler, Major Sir Granville C. H.

    Hohler, Sir Gerald Fitzroy

    Perkins, Colonel E. K.

    Williams, Com. C. (Devon, Torquay)

    Holt, Captain H. P

    Perring, Sir William George

    Williams, Herbert G. (Reading)

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Peto, Sir Basil E. (Devon, Barnstaple)

    Windsor-Clive, Lieut.-Colonel George

    Hope, Sir Harry (Forfar)

    Pownall, Sir Assheton

    Winterton. Rt. Hon. Earl

    Hopkins, J. W. W.

    Preston, William

    Wise, Sir Fredric

    Hopkinson, Sir A. (Eng. Universities)

    Price, Major C. W. M

    Withers, John James

    Hopkinson, A. (Lancaster, Mossley)

    Radford, E. A.

    Womersley, W. J.

    Horne, Rt. Hon. Sir Robert S.

    Raine, Sir Walter

    Wood, Sir Kingsley (Woolwich, W.)

    Howard-Bury, Lieut.-Colonel C. K.

    Ramsden, E.

    Wood, Sir S. Hill-(High Peak)

    Hudson, Capt. A. U. M. (Hackney, N.)

    Rawson, Sir Cooper

    Worthington-Evans, Rt. Hon. Sir L.

    Hudson, R. S. (Cumberl'nd, Whlteh'n)

    Reid, D. D. (County Down)

    Young, Rt. Hon. Sir Hilton (Norwich)

    Hume, Sir G. H.

    Rentoul, G. S.

    Huntingfield, Lord

    Rhys, Hon. C. A. U.

    TELLERS FOR THE AYES.—

    Hurst, Gerald B.

    Rice, Sir Frederick

    Major Sir George Hennessy and Major Cope.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Dalton, Hugh

    Grundy, T. W.

    Alexander, A. V. (Sheffield, Hillsbro')

    Davies, Rhys John (Westhoughton)

    Hall, F. (York, W. R., Normanton)

    Baker, Walter

    Day, Colonel Harry

    Hall, G. H. (Merthyr Tydvil)

    Barker, G. (Monmouth, Abertillery)

    Dennison, R.

    Hamilton, Sir R. (Orkney & Shetland)

    Barnes, A.

    Duckworth, John

    Hardie, George D.

    Batey, Joseph

    Dunnico, H.

    Harney, E. A.

    Bondfield, Margaret

    Edwards, C. (Monmouth, Bedwellty)

    Harris, Percy A.

    Bowerman, Rt. Hon. Charles W.

    Edwards, J. Hugh (Accrington)

    Hayday, Arthur

    Briant, Frank

    England, Colonel A.

    Hayes, John Henry

    Broad, F. A.

    Evans, Capt. Ernest (Welsh Univer. )

    Henderson, Rt. Hon. A. (Burnley)

    Brown, Ernest(Leith)

    Forrest, W.

    Henderson, T. (Glasgow)

    Brown, James (Ayr and Bute)

    Gardner, J. P.

    Hirst, G. H.

    Buxton, Rt Hon. Noel

    Garro-Jones, Captain G. M.

    Hirst, W. (Bradford, South)

    Charleton, H. C.

    Gibbins, Joseph

    Hudson, J. H. (Huddersfield)

    Clowes, S.

    Gillett, George M.

    Jenkins, W. (Glamorgan, Neath)

    Cluse, W. S.

    Gosling, Harry

    John, William (Rhondda, West)

    Clynes, Rt. Hon. John R.

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Johnston, Thomas (Dundee)

    Connolly, M.

    Greenwood, A. (Nelson and Colne)

    Jones, Henry Haydn (Merioneth)

    Cowan, D. M. (Scottish Universities)

    Grenfell, D. R. (Glamorgan)

    Jones, J. J. (West Ham, Slivertown)

    Crawfurd, H. E.

    Groves, T.

    Jones, Morgan (Caerphilly)

    268

    269

    Kelly, W. T.

    Robinson, W. C. (Yorks,W. R., Elland)

    Thurtle, Ernest

    Kennedy, T.

    Rose, Frank H.

    Townend, A. E.

    Kirkwood, D.

    Runciman, Rt. Hon. Walter

    Viant, S. P.

    Lansbury, George

    Scrymgeour, E.

    Wallhead, Richard C.

    Lawrence, Susan

    Scurr, John

    Watts-Morgan, Lt.-Col. D. (Rhonnda)

    Lee, F.

    Shepherd, Arthur Lewis

    Wedgwood, Rt. Hon. Josiah

    Lindley, F. W.

    Shiels, Dr. Drummond

    Wellock, Wilfred

    Lunn, William

    Short, Alfred (Wednesbury)

    Welsh, J. C.

    Mackinder, W.

    Sinclair, Major Sir A. (Caithness)

    Whiteley, W.

    Macpherson, Rt. Hon. James I.

    Smillie, Robert

    Wiggins, William Martin

    March, S.

    Smith, Ben (Bermondsey, Rotherhithe)

    Wilkinson, Ellen C.

    Montague, Frederick

    Smith, H. B. Lees (Keighley)

    Williams, C. P. (Denbigh, Wrexham)

    Morrison, R. C. (Tottenham, N.)

    Smith, Rennie (Penistone)

    Williams, David (Swansea, E.)

    Mosley, Oswald

    Snell, Harry

    Williams, Dr. J. H. (Lianelly)

    Murnin, H.

    Snowden, Rt. Hon. Philip

    Wilson, C. H. (Sheffield, Attercliffe)

    Naylor, T. E.

    Spencer, G. A. (Broxtowe)

    Wilson, R. J. (Jarrow)

    Palin, John Henry

    Spoor, Rt. Hon. Benjamin Charles

    Windsor, Walter

    Pethick-Lawrence, F. W.

    Stamford, T. W.

    Wright, W.

    Ponsonby, Arthur

    Stephen, Campbell

    Young, Robert (Lancaster, Newton)

    Potts, John S.

    Stewart, J. (St. Rollox)

    Rlley, Ben

    Strauss, E. A.

    TELLERS FOR THE NOES.—

    Ritson, J.

    Thomas, Rt. Hon. James H. (Derby)

    Sir Robert Hutchison and Mr. Fenby.

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Thorne, W. (West Ham, Plaistow)

    Motion made, and Question put, "That the Clause stand part of the Bill."

    Division No. 217.]

    AYES.

    [5. 59 p. m.

    Acland-Troyte, Lieut.-Colonel

    Churchman, Sir Arthur C.

    Grenfell, Edward C. (City of London)

    Agg-Gardner, Rt. Hon. Sir James T.

    Cobb, Sir Cyril

    Gretton, Colonel Rt. Hon. John

    Ainsworth, Major Charles

    Cochrane, Commander Hon. A. D.

    Grotrian, H. Brent

    Albery, Irving James

    Cockerill, Brig.-General Sir George

    Guinness, Rt. Hon. Walter E.

    Alexander, E. E. (Leyton)

    Colfox, Major Wm. Phillips

    Gunston, Captain D. W.

    Amery, Rt. Hon. Leopold C. M. S.

    Conway, Sir W. Martin

    Hacking, Captain Douglas H.

    Applin, Colonel R. V. K.

    Cooper, A. Duff

    Harrison, G. J. C.

    Apsley, Lord

    Courthope, Colonel Sir G. L.

    Hartington, Marquess of

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Craig, Sir Ernest (Chester, Crewe)

    Harvey, G. (Lambeth, Kennington)

    Astbury, Lieut.-Commander F. W.

    Croft, Brigadier-General Sir H.

    Harvey, Major S. E. (Devon, Totnes)

    Astor, Viscountess

    Crooke, J. Smedley (Deritend)

    Haslam, Henry C.

    Baldwin, Rt. Hon. Stanley

    Crookshank, Col. C. de W. (Berwick)

    Hawke, John Anthony

    Balfour, George (Hampstead)

    Crookshank, Cpt. H.(Lindsey, Gainsbro)

    Headlam, Lieut.-Colonel C. M.

    Balniel, Lord

    Curzon, Captain Viscount

    Henderson, Capt. R. R. (Oxf'd, Henley)

    Barclay-Harvey, C. M.

    Dalkeith, Earl of

    Heneage, Lieut.-Col. Arthur P.

    Barnett, Major Sir Richard

    Davidson, Major-General Sir J. H.

    Henn, Sir Sydney H.

    Barnston, Major Sir Harry

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    Hennessy, Major J. R. G.

    Beamish, Rear-Admiral T. P. H.

    Davies, Sir Thomas (Clrencester)

    Hills, Major John Waller

    Beckett, Sir Gervase (Leeds, N.)

    Davies, Dr. Vernon

    Hilton, Cecil

    Bennett, A. J.

    Dean Arthur Wellesley

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G

    Berry, Sir George

    Dixon, Captain Rt. Hon. H.

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Betterton, Henry B.

    Drewe, C.

    Hohler, Sir Gerald Fitzroy

    Blundell, F. N.

    Eden Captain Anthony

    Holt, Captain H. P.

    Boothby, H. J. G.

    Ellis, R. G.

    Hope Capt. A. O. J. (Warw'k, Nun.)

    Bourne, Captain Robert Croft

    Elveden, Viscount

    Hope, Sir Harry(Forfar)

    Bowyer, Captain G. E. W.

    Erskine, Lord (Somerset, Weston-s-M.)

    Hopkins, J. W. W.

    Braithwaite, Major A. N.

    Everard W. Lindsay

    Hopkinson, Sir A. (Eng. Universities)

    Brass, Captain W.

    Fairfax, Captain J. G.

    Hopkinson, A. (Lancaster, Mossley)

    Brassey, Sir Leonard

    Falle, Sir Bertram G.

    Horne, Rt. Hon. Sir Robert S.

    Brittain, Sir Harry

    Fermoy, Lord

    Howard-Bury, Lieut.-Colonel C. K.

    Brooke, Brigadier-General C. R. I.

    Fielden, E. B.

    Hudson, Capt. A. U. M. (Hackney, N.)

    Broun-Lindsay, Major H.

    Finburgh, S.

    Hudson, R. S. (Cumberland, Whiteh'n)

    Brown, Brig.-Gen. H. C. (Berks, Newb'y)

    Ford, Sir, P. J.

    Hume, Sir G. H.

    Buchan, John

    Forestier-Walker, Sir L.

    Huntingfield, Lord

    Buckingham, Sir H.

    Foster, Sir Harry S.

    Hurd, Percy A.

    Bull, Bt. Hon. Sir William James

    Foxcroft, Captain C. T.

    Hurst Gerald B.

    Bullock, Captain M.

    Fraser, Captain Ian

    Hutchison, G. A. Clark (Mldl'n & P'bl'S)

    Burman, J. B.

    Fremantle, Lieut.-Colonel Francis E.

    Inskip Sir Thomas Walker H.

    Burney, Lieut.-Com. Charles D.

    Gadie, Lieut.-Col. Anthony

    Jackson, Sir H. (Wandsworth, Cen'l)

    Butler, Sir Geoffrey

    Ganzonl, Sir John

    Jacob, A. E.

    Butt, Sir Alfred

    Gates, Percy

    James, Lieut. -Colonel Hon. Cuthbert

    Cadogan, Major Hon. Edward

    Gault. Lieut.-Col. Andrew Hamilton

    Jephcott, A. R.

    Caine, Gordon Hall

    Gibbs, Col. Rt. Hon. George Abraham

    Kidd, J. (Linlithgow)

    Campbell, E. T.

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Kindersley, Major G. M.

    Cayzer, Sir C. (Chester, City)

    Glyn, Major R. G. C.

    King, Commodore Henry Douglas

    Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.)

    Goff Sir Park

    Kinloch-Cooke, Sir Clement

    Cazalet, Captain Victor A.

    Gower, Sir Robert

    Knox, Sir Alfred

    Cecil, Rt. Hon. Sir Evelyn (Aston)

    Grace, John

    Lamb, J. Q.

    Chadwick, Sir Robert Burton

    Grattan-Doyle, Sir N.

    Lane Fox, Col. Rt. Hon. George R.

    Chapman, Sir S.

    Greaves-Lord, Sir Walter

    Leigh, Sir John (Clapham)

    Chilcott, Sir Warden

    Greene, W. P. Crawford

    Lister, Cunliffe, Rt. Hon. Sir Philip

    Christie, J. A.

    Greenwood, Rt. Hn. Sir H. (W'th's'w, E.)

    Locker-Lampson, G. (Wood Green)

    Churchill, Rt. Hon. Winston Spencer

    Long, Major Eric

    The Committee divided: Ayes, 258, Noes, 123.

    Looker, Herbert William

    Radford, E. A.

    Sueter, Rear-Admiral Murray Fraser

    Lougher, Lewis

    Raine, Sir Walter

    Sykes, Major-Gen. Sir Frederick H.

    Lowe, Sir Francis William

    Ramsden, E.

    Tasker, R. Inigo.

    Luce, Major-Gen. Sir Richard Harman

    Rawson, Sir Cooper

    Templeton, W. P.

    Lumley, L. R.

    Reid, D. D. (County Down)

    Thom, Lt.-Col. J. G. (Dumbarton)

    Lynn, Sir R. J.

    Rentoul, G. S.

    Thompson, Luke (Sunderland)

    Macdonald, Capt. P. D. (I. of W.)

    Rhys, Hon. C. A. U.

    Thomson, F. C. (Aberdeen, South)

    Macdonald, R. (Glasgow, Cathcart)

    Rice, Sir Frederick

    Thomson, Rt. Hon. Sir W. Mitchell-

    McLean, Major A.

    Robinson, Sir T. (Lancs., Stretford)

    Tinne, J. A.

    Macmllian, Captain H.

    Russell, Alexander West (Tynemouth)

    Titchfield, Major the Marquess of

    Macnaghten, Hon. Sir Malcolm

    Salmon, Major I.

    Tryon, Rt. Hon. George Clement

    McNeill, Rt. Hon. Ronald John

    Samuel, A. M. (Surrey, Farnham)

    Vaughan-Morgan, Col. K. P.

    Makins, Brigadier-General E.

    Sandeman, N. Stewart

    Wallace, Captain D. E.

    Malone, Major P. B.

    Sanders, Sir Robert A.

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Manningham-Buller, Sir Mervyn

    Sanderson, Sir Frank

    Warner, Brigadier-General W. W.

    Marriott, Sir J. A. R.

    Sandon, Lord

    Warrender, Sir Victor

    Meyer, Sir Frank

    Sassoon, Sir Philip Albert Gustave D.

    Waterhouse, Captain Charles

    Milne, J. S. Wardlaw

    Savery, S. S.

    Watson, Sir F. (Pudsey and Otley)

    Mitchell, S. (Lanark, Lanark)

    Scott, Rt. Hon. Sir Leslie

    Watson, Rt. Hon. W. (Carlisle)

    Mitchell, W. Foot (Saffron Walden)

    Sheffield, Sir Berkeley

    Wells, S. R.

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Shepperson, E. W.

    Wheler, Major Sir Granville C. H.

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Simms, Dr. John M. (Co. Down)

    Williams, Com. C. (Devon, Torquay)

    Murchison, Sir Kenneth

    Sinclair, Col. T. (Queen's Univ., Belfast)

    Williams, Herbert G. (Reading)

    Nelson, Sir Frank

    Skelton, A. N.

    Windsor-Clive, Lieut.-Colonel George

    Newman, Sir R. H. S. D. L. (Exeter)

    Smith, R. W.(Aberd'n & Kinc'dine, C.)

    Winterton, Rt. Hon. Earl

    Nicholson, Col. Rt. Hn. W. G.(Ptrsf'ld.)

    Smith-Carington, Neville W.

    Wise, Sir Fredric

    Oman, Sir Charles William C.

    Somerville, A. A. (Windsor)

    Withers, John James

    Penny, Frederick George

    Spender-Clay, Colonel H.

    Womersley, W. J.

    Percy, Lord Eustace (Hastings)

    Sprot, Sir Alexander

    Wood, Sir Kingsley (Woolwich, W.)

    Perkins, Colonel E. K.

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Wood, Sir S. Hill-(High Peak)

    Perring, Sir William George

    Steel, Major Samuel Strang

    Worthington-Evans, Rt. Hon. Sir L.

    Peto, Sir Basil E. (Devon, Barnstaple)

    Stuart, Crichton-, Lord C.

    Young, Rt. Hon. Sir Hilton (Norwich)

    Preston, William

    Stuart, Hon. J. (Moray and Nairn)

    Price, Major C. W. M.

    Styles, Captain H. W.

    TELLERS FOR THE AYES.—

    Major Cope and Captain Margesson.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Hamilton, Sir R. (Orkney & Shetland)

    Scurr, John

    Alexander, A. V. (Sheffield, Hillsbro')

    Hardie, George D.

    Shepherd, Arthur Lewis

    Baker, Walter

    Harris, Percy A.

    Shiels, Dr. Drummond

    Barker, G. (Monmouth, Abertillery)

    Hayday, Arthur

    Short, Alfred (Wednesbury)

    Barnes, A.

    Hayes, John Henry

    Sinclair, Major Sir A. (Caithness)

    Batey, Joseph

    Henderson, Rt. Hon. A. (Burnley)

    Slesser, Sir Henry H.

    Bondfield, Margaret

    Henderson, T. (Glasgow)

    Smillie, Robert

    Bowerman, Rt. Hon. Charles W.

    Hirst, G. H.

    Smith, H. B. Lees (Keighley)

    Briant, Frank

    Hirst, W. (Bradford, South)

    Smith, Rennie (Penistone)

    Broad, F. A.

    Jenkins, W. (Glamorgan, Neath)

    Snell, Harry

    Brown, Ernest (Leith)

    John, William (Rhondda, West)

    Snowden, Rt. Hon. Philip

    Brown, James (Ayr and Bute)

    Johnston, Thomas (Dundee)

    Spencer, G. A. (Broxtowe)

    Buxton, Rt. Hon. Noel

    Jones, Henry Haydn (Merioneth)

    Spoor, Rt. Hon. Benjamin Charles

    Charleton, H. C.

    Jones, J. J. (West Ham, Slivertown)

    Stamford, T. W.

    Cluse, W. S.

    Jones, Morgan (Caerphilly)

    Stephen, Campbell

    Clynes, Rt. Hon. John R.

    Kelly, W. T.

    Stewart, J. (St. Rollox)

    Connolly, M.

    Kennedy, T.

    Strauss, E. A.

    Cowan, D. M. (Scottish Universities)

    Kirkwood, D.

    Thomas, Rt. Hon. James H. (Derby)

    Crawfurd, H. E.

    Lansbury, George

    Thorne, W. (West Ham, Plaistow)

    Dalton, Hugh

    Lawrence, Susan

    Thurtle, Ernest

    Davies, Rhys John (Westhoughton)

    Lee, F.

    Townend, A. E.

    Day, Colonel Harry

    Lindley, F. W.

    Viant, S. P.

    Dennison, R.

    Lunn, William

    Wallhead, Richard C.

    Duckworth, John

    Mackinder, W.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Dunnico, H

    Macpherson, Rt. Hon. James I.

    Webb, Rt. Hon. Sidney

    Edwards, C. (Monmouth, Bedwellty)

    March, S.

    Wedgwood, Rt. Hon. Josiah

    Edwards, J. Hugh (Accrington)

    Montague, Frederick

    Wellock, Wilfred

    England, Colonel A.

    Morrison, R. C. (Tottenham, N.)

    Welsh, J. C.

    Evans, Capt. Ernest (Welsh Univer.)

    Mosley, Oswald

    Whiteley, W.

    Forrest, W.

    Murnin, H.

    Wiggins, William Martin

    Gardner, J. P.

    Naylor, T. E.

    Wilkinson, Ellen C.

    Garro-Jones, Captain G. M.

    Palin, John Henry

    Williams, C. P. (Denbigh, Wrexham)

    Gibbins, Joseph

    Pethick-Lawrence, F. W.

    Williams, David (Swansea, East)

    Gillett, George M.

    Ponsonby, Arthur

    Williams, Dr. J. H. (Lianelly)

    Gosling, Harry

    Potts, John S.

    Wilson, C. H. (Sheffield, Attercliffe)

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Rlley, Ben

    Wilson, R. J. (Jarrow)

    Greenwood, A. (Nelson and Colne)

    Ritson, J.

    Windsor, Walter

    Grenfell, D. R. (Glamorgan)

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Wright, W.

    Groves, T.

    Robinson, W. C. (Yorks, W. R., Elland)

    Young, Robert (Lancaster, Newton)

    Grundy, T. W.

    Rose, Frank H.

    Hall, F. (York, W. R., Normanton)

    Runciman, Rt. Hon. Walter

    TELLERS FOR THE NOES.—

    Hall, G. H. (Merthyr Tydvil)

    Scrymgeour, E.

    Sir Robert Hutchison and Mr. Fenby.

    CLAUSE 3.—(Exemption of motor tyres from Customs duty to cease.)
    Mr. HARRIS: I beg to move, in page 2, line 16, to leave out the words "motor bicycles and motor tricycles."
    The name of McKenna has been so much taken in vain by various Chancellors of the Exchequer, and his War taxes have been pleaded as a justification for so many bad taxes, that it is interesting to note the provisions of this Clause, Even Mr. McKenna, hard up as he was for revenue, and ingenious as he was in finding the necessary money to carry on the War, came to the conclusion, after taking careful advice, that it would not be either wise or satisfactory to tax motor tyres. At this stage of these proceedings I am only going to refer to one side of the question. The principle underlying the general taxation of motor tyres can be considered subsequently on the main Question of the Clause standing part, but I am going now to ask the Committee, whatever it may decide on the larger question of policy, to exclude taxes on tyres of motor bicycles and tricycles. When we consider this as a question of policy I think there is an unanswerable case. It may be argued that our importation of motor bicycles and tricycles is comparatively small compared with our production and export of those articles. No doubt, thanks largely to the import of untaxed materials, we have been able to do the main motor-bicycle trade of the world. The English motor bicycle and the English motor car stand supreme, not only in our own Dominions but throughout the world, for price, wearing qualities and efficiency.
    We depend largely on our export trade, although at present, in spite of the duty on the completed article, we are still importing a considerable number—some thousands each year. The Committee, by this Clause, is being asked to impose a tax on an important accessory of the motor bicycle, and, in fact, on a component part. Does it not seem a little unwise and short-sighted, in view of the immense export trade which we are doing, to throw out this challenge to foreign countries with which we are doing a large business? Does it seem a sane policy, even to those who believe in protection? There is also the point
    274
    of view of the users of the motor bicycle. In many parts of the country, especially in the Midlands, the motor bicycle has become essential to the ordinaiy working man. In certain towns you will see hundreds of motor bicycles carrying men to and from their work. The motor car is outside the reach of these men in price. In America the Ford car very largely does this work, but in England, partly because of the character of our roads and partly because of the adventurous spirit of our people the noisy bumping of the motor bicycle is preferred. Further, a man, who would never dream of owning a motor car, is able to keep a motor bicycle because it is easily stored, while the initial outlay is lighter and the tax smaller than in the case of a motor car. It may be said that the tyre is a very small part of the bicycle, but I would remind the Committee that in taxing the tyre they are coming very near to another road tax. The tyre tax is very near the old wheel tax, and the wheel tax nearly brought down at least one Government owing to the great outcry against it. This blessed Conservative and reactionary Government by taxing tyres is ingeniously restoring the principle of the wheel tax and, perhaps, a window tax will be the next experiment if we live long enough under the reckless extravagance of the present Chancellor of the Exchequer.
    The principle in this Clause seems to me to be unsound. I am not in a position to state the percentage of imports of tyres coming under the categories of motor bicycles and motor tricycles, but I think there is a very strong case for exempting this very essential part of a popular means of conveyance. The housing problem is a burning question with social reformers, and one of the difficulties experienced in London and elsewhere has been that of carrying people from the centres of population to the new garden suburbs which are coming into existence. In London the motor bicycle has not solved the problem but in provincial towns, where the difficulty of access is not so serious, the motor bicycle has been of tremendous assistance and has enabled men to live six or 10 or 20 miles away from their work. There is an overwhelming case against the inclusion of motor bicycles in this Clause.

    275
    I am glad to see in his place my hon. and gallant Friend the Member for Bournemouth (Brigadier-General Sir Henry Croft). I admire his frankness, sincerity and courage. There is no mincing of words and no quibbling on his part. He does not profess to be at heart a Free Trader, or to be against the imposition of taxes. He is, frankly and honestly, a Protectionist. Not only does he believe Protection is a good thing, but he has the courage of his principles. That is the type of opponent I respect, and his attitude helps the cause far better than does the attitude of Members on the Treasury bench, who assure us they are really Free Traders, not in favour of tariffs, but only going in for safeguarding, or, in the case of some duties, supporting them not in order to safeguard industry but merely for the sake of obtaining revenue. As I understand it, the Financial Secretary will justify this tax not because it is protective but because the country is hard up, and other sources than films and matches must he found in order to provide money. I have no doubt that my hon. and gallant Friend the Member for Bournemouth will say that already a new factory is going to be put up in this country by a French firm which is fighting the great tyre trust, the Dunlop Company. I am informed, however, that arrangements were made to erect that factory before ever this tax was thought of.
    Brigadier-General Sir HENRY CROFT: May I correct the hon. Member, as he referred specially to me? May I tell him that his information is out of date, because I think two other factories are coming to this country?
    Mr. HARRIS: That is quite possible, hut our experience is that so soon as a tariff is put on, and Protection is thus provided, these big concerns come together and either fix up a selling agreement or form a trust. Tariffs are the friends of trusts. The tyre companies in this country have always had against them the healthy breeze of foreign competition, and they have not been able to establish any combines or to bring all the various companies into line; but experience in America and in other parts of the world proves that so soon as a tariff wall is put up arrangements are made whereby if the price of the article
    276
    is not raised, at any rate it is stabilised; which is very similar to raising prices, because otherwise prices would tend to fall as production improves. As soon as this tariff wall is properly fixed and entrenched these big manufacturing companies, powerful, wealthy companies, will come to an arrangement and a combine or trust will be formed; and to avoid that I think it is essential that we should have the advantage of imports to protect the consumer and prevent the trusts from withholding the advantage of low prices from the public. I think I have made a very strong case, and I hope the Financial Secretary will listen to the light of reason, and at any rate exclude tyres for motor bicycles, which are so essential for the convenience of the working class.
    Mr. LEES-SMITH?: I rise merely to ask whether the Financial Secretary to the Treasury proposes to make any reply.
    Mr. McNEILL: I certainly propose to make a reply if a case is made out on the other side of the Committee.
    Mr. RUNCIMAN: Surely the Financial Secretary is not going to dispose of a question of this importance by a sneer at the case which has been put up from these benches? I feel quite sure that the right hon. Gentleman will never be lacking in courtesy, And if he has been listening, as I have no doubt he has been, to what my hon. Friend has said, he will know that a case has been made out which merits some reply from the Treasury bench.
    Mr. McNEILL: May I interrupt to say that is quite true, but the right hon. Gentleman has put his own name to this Amendment, and I thought courtesy required that I should allow him to strengthen the case of his hon. Friend.
    Mr. RUNCIMAN: The right hon. Gentleman need have no anxiety on that score. I do not propose to detain the Committee, because my hon. Friend has made out a sufficiently good case to merit a reply from the right hon. Gentleman and I hope we shall have it.
    Mr. McNEILL: May I ask the right hon. Gentleman whether he intends to give the Committee the benefit of his views on this matter? Otherwise, I consider I am entitled to choose my own time for addressing the Committee.
    Captain GARRO-JONES: I think it would be the very minimum of courtesy for the Financial Secretary to tell us for what reason it is impossible for the Government to accept this Amendment. There is a great deal to be said in favour of it, apart from the arguments which have been advanced by the hon. Member for South-West Bethnal Green (Mr. Harris). I consider that in the interest of the health of the nation it would be a splendid thing—[Laughter]—this is no laughing matter—for those poor people who are unable to afford motor cars, but are able to afford bicycles and motor cycles, to be able to get tyres a little cheaper. In my constituency in the East End of London there are hundreds of people whose sole recreation, whose only means of getting out into the fresh air, is on a bicycle or a motor bicycle, and I know the sacrifices to which some of them submit in order to save enough money to purchase one. Therefore, when the right hon. Gentleman is asked whether he, can see his way either to reduce or altogether remove this tax on tyres, I think we are entitled to some reply. We are not asking him to remove the tax on tyres altogether. I ask him why the Government are unable to make this reduction in the tax on cheap tyres and I hope he will let us have some reply, or we shall have to speak at considerably greater length on the subsequent Amendments on the Order Paper.
    Mr. McNEILL: I do not like to disappoint the Committee any longer as hon. Members seem anxious that I should make a reply at the earliest possible moment instead of waiting in order to collect the various views, which are not always identical, in favour of the Amendment, a course which I thought would be more convenient. I do not propose to tape up the time of the Committee by rising repeatedly to make a reply to everybody who chooses to address it. I have sometimes heard complaints that an individual reply is not given on every occasion, but I was proposing to wait until a number of Members had addressed the Committee before attempting to give a reply on behalf of the Government. As it is, I have to be content with the speeches of the two hon. Members and it is quite true that the hon. and gallant Member for South Hackney (Captain Garro-Jones) did strengthen the case
    278
    which had been made by the hon. Member for South-West Bethnal Green (Mr. Harris).
    The hon. Member for South-West Bethnal Green supported this Amendment on a number of different grounds. First of all, there was the orthodox Free Trade argument. That did not surprise me at all. He saw that this particular Clause is some infringement of that doctrine, and naturally he did not lose the opportunity of pointing it out. His second point was that as compared with motor cars the motor-bicycle is used by the comparatively less well-to-do. Then he passed on to the point that injury might be inflicted upon our export trade if the Amendment were not accepted. To these arguments the hon. and gallant Member who followed him added the cause of national health. So now we have all these various grounds, including national health, as a reason for making this particular exception to the duty which will be imposed upon motor tyres by this Bill.
    I do riot think the Committee will expect me to go over all these various reasons, including national health. I admit at once that motor cycling is a delightful, a healthy and a desirable recreation, and that as many people as possible ought to go out into the country on motor cycles, and therefore I cannot be accused of being unsympathetic on that score. I also admit that the owner of the motor bicycle is, as a rule, a less wealthy person than the man who has a large motor car. I do not see, however, that either of these reasons affords any sufficient ground for making this exception to the duty. We have been talking about the duties on tea and other commodities consumed by the mass of the people. Taking a broad general view, there is no doubt that all people who are fortunate enough to own motor vehicles of any sort are, on the whole, comparatively well-to-do as compared with the large mass of the people, and I do not think there is any legitimate ground for claiming that the owner of a motor cycle is distinguished from any other user of imported tyres.
    The hon. Member for South-West Bethnal Green said it was to the advantage of everybody owning a motor ear to have tyres imported into this country, because in that way he would be able to get them cheaper. I am not at all sure that is the case. The motor-car

    279
    tyres manufactured by Dunlops have not risen in price since the announcement of this duty, and I do not believe they will. At any rate, if they do, the rise will be perfectly trifling. In addition to that, as the hon. Member himself mentions, some foreign manufacturers have set up, and are intending to set up, factories in this country, and I have no doubt that the competition which that will cause amongst manufacturers in this country will prevent any real rise in the price of tyres such as could give any legitimate cause for complaint.
    Let me point out the most important reasons for not accepting this Amendment. Last year an exception in favour of commercially-used motor cars was done away with, and the main reason for that, as was explained at the time, lay in the very great administrative difficulties of distinguishing in the case of the parts and accessories of motor cars whether or not the imported article was for use on a commercial vehicle, in which case it would be exempt from duty, or for use on another sort of car, in which case it would be subject to duty. It was for that reason, mainly, that that distinction was swept away last year. If this Amendment Were accepted, we should be reintroducing that difficulty in another form, and in some ways a more obnoxious form, because I am advised that it would be quite impossible for the Customs Department to say when a tyre reached our shores whether it was to come under the exemptions which this Amendment would introduce or whether it would be subject to duty.

    Division No. 218.]

    AYES.

    [6.34 p.m.

    Acland-Troyte, Lieut.-Colonel

    Birchall, Major J. Dearman

    Cayzer, Sir C. (Chester, City)

    Agg-Gardner, Rt. Hon. Sir James T.

    Blundell, F. N.

    Cazalet, Captain Victor A.

    Ainsworth, Major Charles

    Boothby, R. J. G.

    Chadwick, Sir Robert Burton

    Albery, Irving James

    Bourne, Captain Robert Croft

    Chapman, Sir S.

    Alexander, E. E. (Leyton)

    Bowyer, Captain G. E. W.

    Chilcott, Sir Warden

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Braithwaite, Major A. N.

    Christie, J. A.

    Amery, Rt. Hon. Leopold C. M. S.

    Brass, Captain W.

    Churchill, Rt. Hon. Winston Spencer

    Applin, Colonel R. V. K.

    Brassey, Sir Leonard

    Churchman, Sir Arthur C.

    Apsley, Lord

    Brittain, Sir Harry

    Clayton, G. C.

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Brooke, Brigadier-General C. R. I.

    Cobb, Sir Cyril

    Astbury, Lieut.-Commander F. W.

    Broun-Lindsay, Major H.

    Cochrane, Commander Hon. A. D.

    Atkinson, C.

    Brown, Brig.-Gen. H. C. (Berks, Newb'y)

    Colfox, Major Wm. Phillips

    Baldwin, Rt. Hon. Stanley

    Buchan, John

    Conway, Sir W. Martin

    Balfour, George (Hampstead)

    Buckingham, Sir H.

    Coops, A. Duff

    Balniel, Lord

    Bull, Rt. Hon. Sir William James

    Cope, Major William

    Barclay-Harvey, C. M.

    Bullock, Captain M.

    Courthope, Colonel Sir G. L.

    Barnett, Major Sir Richard

    Burman, J. B.

    Craig, Sir Ernest (Chester, Crewe)

    Barnston, Major Sir Harry

    Burney, Lieut.-Com. Charles D.

    Croft, Brigadier-General Sir H.

    Beamish, Rear-Admiral T. P. H.

    Butler, Sir Geoffrey

    Crooke, J. Smedley (Derltend)

    Beckett, Sir Gervase (Leeds, N.)

    Butt, Sir Alfred

    Crookshank, Cpt. H. (Lindsey, Gainsbro)

    Bennett, A. J.

    Cadogan, Major Hon. Edward

    Curzon, Captain Viscount

    Berry, Sir George

    Caine, Gordon Hall

    Dalkeith, Earl of

    Betterton, Henry B.

    Campbell, E. T.

    Davidson, Major-General Sir J. H.

    For that reason, and for no other, I must ask the Committee to reject this Amendment. Really, I can see no reason whatever in its favour. I have already explained the reason why an exemption was made in the case of the duty on these tyres in 1915. The Committee will remember that originally tyres were not exempted from the duty imposed in 1915 upon accessories and parts, but it was by an Amendment introduced in 1915 that an exemption was matte in the case of tyres for reasons with which the Committee is familiar. Those reasons have absolutely passed away now, and there is no reason why that exemption should be continued which, for special reasons, was introduced in 1915. Those reasons apply all round to all sorts of tyres whether for use in the case of motor cycles or large cars. No satisfactory reason has been adduced by the hon. Member who moved this Amendment in favour of its acceptance, nor has he made out any case for his proposal. I admit that the hon. Member has brought forward some reasons which might be considered valid against a duty on tyres all round, but he has made no case for this particular exemption. This Amendment is one which would cut into the administration of the duty, and it would mean a certain amount of loss to the revenue. For these reasons, I hope the Committee will reject the Amendment.
    Question put, "That the words proposed to be left put stand part of the Clause."
    The Committee divided: Ayes, 255; Noes, 130.

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    Horne, Rt. Hon. Sir Robert S.

    Rice, Sir Frederick

    Davies, Sir Thomas (Cirencester)

    Howard-Bury, Lieut.-Colonel C. K.

    Russell, Alexander West (Tynemouth)

    Davies, Dr. Vernon

    Hudson, Capt. A. U. M. (Hackney, N.)

    Salmon, Major I.

    Dawson, Sir Philip

    Hudson, R. S. (Cumberland, Whiteh'n)

    Samuel, A. M. (Surrey, Farnham)

    Dean, Arthur Wellesley

    Hume, Sir G. H.

    Sandeman, N. Stewart

    Dixon, Captain Rt. Hon. Herbert

    Huntingfield, Lord

    Sanders, Sir Robert A.

    Drewe, C.

    Hurst, Gerald B.

    Sanderson, Sir Frank

    Eden, Captain Anthony

    Hutchison, G. A. Clark (Mldl'n & P'bl's)

    Sandon, Lord

    Ellis, R. G.

    Jackson, Sir H. (Wandsworth, Cen'l)

    Sassoon, Sir Philip Albert Gustave D.

    Elveden, Viscount

    Jacob, A. E.

    Savery, S. S.

    Erskine, Lord (Somerset, Weston-s.-M.)

    James, Lieut.-Colonel Hon. Cuthbert

    Scott, Rt. Hon. Sir Leslie

    Everard, W. Lindsay

    Jephcott, A. R.

    Sheffield, Sir Berkeley

    Fairfax, Captain J. G.

    Jones, G. W. H. (Stoke Newington)

    Shepperson, E. W.

    Falle, Sir Bertram G.

    Kidd, J. (Linlithgow)

    Simms, Dr. John M. (Co. Down)

    Fielden, E. B.

    Kindersley, Major Guv M.

    Sinclair, Col. T. (Queen's Univ., Belfast)

    Finburgh, S.

    King, Commodore Henry Douglas

    Skelton, A. N.

    Ford, Sir P. J.

    Kinloch-Cooke, Sir Clement

    Smith, R. W. (Aberd'n & Kinc'dlne, C.)

    Forestier-Walker, Sir L.

    Knox, Sir Alfred

    Smith-Carington, Neville W.

    Foster, Sir Harry S.

    Lamb, J. O.

    Somerville, A. A. (Windsor)

    Foxcroft, Captain C. T.

    Lane Fox, Col. Rt. Hon. George R.

    Spender-Clay, Colonel H.

    Fraser, Captain Ian

    Leigh, Sir John (Clapham)

    Sprot, Sir Alexander

    Gadie, Lieut.-Col. Anthony

    Lister, Cunliffe, Rt. Hon. Sir Philip

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Ganzonl, Sir John

    Locker-Lampson, G. (Wood Green)

    Steel, Major Samuel Strang

    Gates, Percy

    Long, Major Eric

    Stuart, Crichton-, Lord C.

    Gauit Lieut-Col. Andrew Hamilton

    Looker, Herbert William

    Stuart, Hon. J. (Moray and Nairn)

    Gibbs, Col. Rt. Hon. George Abraham

    Lougher, Lewis

    Styles, Captain H. Walter

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Lowe, Sir Francis William

    Sueter, Rear-Admiral Murray Fraser

    Glyn, Major R. G. C.

    Luce, Maj.-Gen. Sir Richard Harman

    Sugden, Sir Wilfrid

    Goff, Sir Park

    Lumley, L. R.

    Sykes, Major-Gen. Sir Frederick H.

    Gower, Sir Robert

    Lynn, Sir R. J.

    Tasker, R. Inigo.

    Grace, John

    Macdonald, Capt. P. D. (I. of W.)

    Templeton, W. P.

    Grattan Doyle, Sir N.

    Macdonald, R. (Glasgow, Cathcart)

    Thom, Lt.-Col. J. G. (Dumbarton)

    Greaves-Lord, Sir Walter

    McLean, Major A.

    Thompson, Luke (Sunderland)

    Greene, W. P. Crawford

    Macmillan, Captain H.

    Thomson, F. C. (Aberdeen, South)

    Greenwood, Rt. Hn. Sir H. (W'th's'w, E)

    McNeill, Rt. Hon. Ronald John

    Thomson, Rt. Hon. Sir W. Mitchell-

    Grenfell, Edward C. (City of London)

    Makins, Brigadier-General E.

    Tinne, J. A.

    Gretton, Colonel Rt. Hon. John

    Malone, Major P. B.

    Titchfield, Major the Marquess of

    Grotrian, H. Brent

    Manningham-Buller, Sir Mervyn

    Tryon, Rt. Hon. George Clement

    Guinness, Rt. Hon. Walter E.

    Marriott, Sir J. A. R.

    Vaughan-Morgan, Col. K. P.

    Gunston, Captain D. W.

    Meyer, Sir Frank

    Wallace, Captain D. E.

    Hacking, Captain Douglas H.

    Milne, J. S. Wardlaw-

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Hall, Lieut. -Col. Sir F. (Dulwich)

    Mitchell, S. (Lanark, Lanark)

    Warner, Brigadier-General W. W.

    Harrison, G. J. C.

    Mitchell, W. Foot (Saffron Walden)

    Warrender, Sir Victor

    Hartington, Marquess of

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Waterhouse, Captain Charles

    Harvey, G. (Lambeth, Kennington)

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Watson, Rt. Hon. W. (Carlisle)

    Harvey, Major S. E. (Devon, Totnes)

    Moreing, Captain A. H.

    Wells, S. R.

    Haslam, Henry C.

    Morrison-Bell, Sir Arthur Clive

    Wheler, Major Sir Granville C. H.

    Hawke, John Anthony

    Nelson, Sir Frank

    Williams, A. M. (Cornwall, Northern)

    Headlam, Lieut.-Colonel C. M.

    Nicholson, Col. Rt. Hn. W. G.(Ptrsf'ld.)

    Williams, Com. C. (Devon, Torquay)

    Henderson, Capt. R. R. (Oxf'd, Henley)

    Oman, Sir Charles William C.

    Williams, Herbert G. (Reading)

    Heneage, Lieut.-Colonel Arthur P.

    Ormsby-Gore, Rt. Hon. William

    Windsor-Clive, Lieut.-Colonel George

    Henn, Sir Sydney H.

    Penny, Frederick George

    Winterton, Rt. Hon. Earl

    Herbert, Dennis (Hertford, Watford)

    Percy, Lord Eustace (Hastings)

    Wise, Sir Fredric

    Hills, Major John Waller

    Perkins, Colonel E. K.

    Withers, John James

    Hilton, Cecil

    Perring, Sir William George

    Womersley, W. J.

    Hoare, Lt,-Col. Rt. Hon, Sir S. J. G.

    Preston, William

    Wood, E. (Chest'r, Stalyb'dge & Hyde)

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Price, Major C. W. M.

    Wood, Sir Kingsley (Woolwich, W.)

    Hohler, Sir Gerald Fitzroy

    Radford, E. A.

    Worthington-Evans, Rt. Hon. Sir L.

    Holt, Capt. H. P.

    Raine, Sir Walter

    Yerburgh, Major Robert D. T.

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Reid, D. D. (County Down)

    Young, Rt. Hon. Sir Hilton (Norwich)

    Hope, Sir Harry (Forfar)

    Remer, J. R.

    Hopkins, J. W. W.

    Rentoul, G. S.

    TELLERS FOR THE AYES.—

    Hopkinson, A. (Lancaster, Mossley)

    Rhys, Hon. C. A. U.

    Major Sir George Hennessy and Captain Margesson.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Clynes, Rt. Hon. John R.

    Gillett, George M.

    Alexander, A. V. (Sheffield, Hillsbro')

    Connolly, M.

    Gosling, Harry

    Baker, J. (Wolverhampton, Bilston)

    Cowan, D. M. (Scottish Universities)

    Greenwood, A. (Nelson and Coine)

    Baker, Walter

    Crawfurd, H. E.

    Grenfell, D. R. (Glamorgan)

    Barker, G. (Monmouth, Abertillery)

    Davies, Rhys John (Westhoughton)

    Groves, T.

    Barnes, A.

    Day, Colonel Harry

    Grundy, T. W.

    Batey, Joseph

    Dennison, R.

    Hall, F. (York, W. R., Normanton)

    Bondfield, Margaret

    Duckworth, John

    Hall, G. H. (Merthyr Tydvil)

    Bowerman, Rt. Hon. Charles W.

    Dunnico, H.

    Hamilton, Sir R. (Orkney & Shetland)

    Briant, Frank

    Edwards, C. (Monmouth, Bedwellty)

    Hardie, George D.

    Broad, F. A.

    Edwards, J. Hugh (Accrington)

    Harney, E. A.

    Brown, Ernest (Leith)

    England, Colenel A.

    Harris, Percy A.

    Brown, James (Ayr and Bute)

    Evans, Capt. Ernest (Welsh Univer.)

    Hayday, Arthur

    Buxton, Rt. Hon. Noel

    Forrest, W.

    Hayes, John Henry

    Charleton, H. C.

    Gardner, J. P.

    Henderson, Right Hon. A. (Burnley)

    Clowes, S.

    Garro-Jones, Captain G. M.

    Henderson, T. (Glasgow)

    Cluse, W. S.

    Gibbins, Joseph

    Hirst, G. H.

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    Hirst, W. (Bradford, South)

    Palin, John Henry

    Stewart I. (St. Rollox)

    Hudson, J. H. (Huddersfield)

    Pethick-Lawrence, F. W.

    Strauss, E. A.

    Jenkins, W. (Glamorgan, Neath)

    Ponsonby, Arthur

    Thomas, Rt. Hon. James H. (Derby)

    John, William (Rhondda, West)

    Potts, John S.

    Thorne, w. (West Ham, Plaistow)

    Johnston, Thomas (Dundee)

    Riley, Ben

    Thurtle, Ernest

    Jones, Henry Haydn (Merioneth)

    Ritson, J.

    Townend. A. E.

    Jones, J. J. (West Ham, Silvertown)

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Varley, Frank B.

    Jones, Morgan (Caerphilly)

    Robinson, W. C. (Yorks, W. R., Elland)

    Viant, S. P.

    Kelly, W. T.

    Rose, Frank H.

    Wallhead, Richard C.

    Kennedy, T.

    Runciman, Rt. Hon Walter

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Kirkwood, D.

    Scrymgeour, E.

    Webb, Rt. Hon. Sidney

    Lansbury, George

    Scurr, John

    Wedgwood, Rt. Hon. Josiah

    Lawrence, Susan

    Shepherd, Arthur Lewis

    Wellock, Wilfred

    Lee, F.

    Shiels, Dr. Drummond

    Welsh, J. C.

    Lindley, F. W.

    Short, Alfred (Wednesbury)

    Whiteley, W.

    Lowth, T.

    Sinclair, Major Sir A. (Caithness)

    Wiggins, William Martin

    Lunn, William

    Slesser, Sir Henry H.

    Wilkinson, Ellen C.

    Mackinder, W.

    Smillie, Robert

    Williams, C. P. (Denbigh, Wrexham)

    MacLaren, Andrew

    Smith, Ben (Bermondsey, Rothe, Aithe)

    Williams, David (Swansea, E)

    Maclean, Nell (Glasgow, Govan)

    Smith, H. B. Lees (Keighley)

    Williams Dr. J. H. (Lianelly)

    Macpherson, Rt. Hon. James I.

    Smith, Rennie (Penistone)

    Wilson, C. H. (Sheffield, Attercliffe)

    March, S.

    Snell, Harry

    Wilson, R. J. (Jarrow)

    Montague, Frederick

    Snowden, Rt. Hon. Philip

    Windsor, Walter

    Morrison, B. C. (Tottenham, N.)

    Spencer, G. A. (Broxtowe)

    Wright, W.

    Mosley, Oswald

    Spoor, Rt. Hon. Benjamin Charles

    Young, Robert (Lancaster, Newton)

    Murnin, H.

    Stamford, T. W.

    Naylor, T. E.

    Stephen, Campbell

    TELLERS FOR THE NOES—

    Motion made and Question proposed, "That the Clause stand part of the Bill."
    Mr. GILLETT: I might remind the Committee that the subject we have now before us brings up that hardy annual known as the McKenna. Duties. Possibly many hon. Members would have been quite glad if some Clause, possibly similar to that dealing with medicines, had been introduced taking the McKenna Duties out of the purview of this Committee. I know we have discussed this question until it has became almost stale, and the arguments must inevitably be very much the same year after year. The McKenna Duties seem to have been used by the party opposite rather as an excuse—
    The CHAIRMAN (Mr. James Hope): I must remind the hon. Member that this Clause only refers to the duty on tyres.
    Mr. GILLETT: May I put it that the exemption is due to the fact that originally they were part of the McKenna Duties. For definite reasons they were taken out of that category, and they are now being placed in the same position as the other McKenna Duties.
    The CHAIRMAN: If the hon. Member wishes to deal with the McKenna Duties, he must put down a new Clause. The discussion on this Clause must be confined to tyres.
    Mr. GILLETT: I should be the last person to desire to discuss the whole question
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    of the McKenna Duties, because I am sure the Committee is tired of discussing that subject. I take it, however, that I shall be in order in reminding the Committee that it was as a part of the McKenna Duties that this duty on tyres first came, before the House, and the reason, although the Financial Secretary did not mention it, was that tyres were taken out of the original duties during the War, because it was thought that their inclusion would give offence to certain American interests at a time when the relationship between this country and America was in a rather difficult position, on account of the stoppage by our Navy of goods that were coming to Europe and ether parts of the world. The reason for their exemption was, therefore, purely a political reason. I take it that the argument of the Financial Secretary is that excuse has now been removed, and that, as there is great need for money, the duties might as well be put back. It seems to me that, whether we are dealing with tyres or with the McKenna Duties, one great principle is involved in this question, and that is whether it is desirable to impose any form of Protection whatever on any lend of article coming into this country. In this case the article under consideration happens to be tyres.
    Why should we impose a protective duty on tyres and, not on many other things? I do not wish to seem to be encroaching on a subject which has been ruled out of order, but the answer given to that question is that this duty was a part of the McKenna Duties. If hon.

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    Members opposite were really going to have Protection, it is quite obvious that they should start, not with things like this, but with agriculture, or something of that sort. Why is it that we have these protective duties on a certain number of articles, thereby imposing a hardship on many trades and industries which, according to hon. Members opposite, are most in need of Protection? It is going to make it harder, for instance, for the farmer who has a motor car; it is going indirectly to increase the cost of his car. I know the right hon. Gentleman will say he has been assured by the traders that there is not going to be any increase in cost, but it is quite impossible to argue that a protective duty will not ultimately increase the cost, except, as I am quite willing to concede to the right hon. Gentleman, in certain circumstances. For instance, it may be that the price is going to fall in any case, and, if at that moment you put on a protective duty, then, instead of the price falling, it may remain as it is. I think many of the articles on which the Government have imposed duties have been in that position. The duty has been imposed at a time when, probably, the price would have fallen, and what has happened has been that the price has remained stationary. Then hon. Members opposite have said that that proved that the argument used against the protective duty was false. It seems to me that the object of a protective duty is only obtained if the price of the article is raised, because, if the price of the article in this country is not raised, the protection will not be sufficient to keep out the article from another country. Ultimately, the cost of a protective duty must fall in some way on the consumer, and I should be glad to see any arguments adduced from a large number of cases that prove that to be false.
    If you once arrive at the principle that goods are going to cost more, then, if certain articles are taken, one here and one there, a hardship is bound to be inflicted. Hon. Members may say that, as the duty has been imposed on motor cars and certain other things, therefore this duty ought to be maintained, but that is really no argument. Some of these duties which are now protective were not really imposed as protective duties, but were imposed with the object of keeping out certain goods which were luxuries, and which at that time were
    286
    not wanted in this country on account of the effect on the exchange and the monetary position. Hon. Members opposite have often taunted those who introduced these duties, and who are Free Traders, with not having held to their principles, but to judge anyone upon action taken during the War is hardly fair, and in any case it is quite legitimate to say that the object was really not protective, but that it was a purely War measure designed to keep out these goods. We have already been told that two or three factories are going to be started in this country, and it may be that hon. Members opposite will say that so many more people have been found employment. On the other hand, it must always be remembered that this will have an effect on certain other trades. Supposing it were possible to realise the idea of certain hon. Members that everything could be provided in this country, our shipping trade and many other trades would inevitably have to suffer, and hon. Members opposite would find it exceedingly difficult to prove that that was not the case. I object to any form of Protection, and it is on that ground that I oppose this Clause.
    Possibly other Members of the House, like myself, have received a protest on the question of motor taxation, not, I think, directed specially to this particular tax, but to the imposition of taxation on the motor industry generally. It came from the National Read Transport Employers' Federation, and it was sent to other Members of the House as well as to myself some three or four months ago. Certain figures are quoted, supplied by the Ministry of Labour, in reference to the number of wholly unemployed persons registered as motor drivers, chauffeurs and so on. The number for London in 1926 is given as 2,275, and that number had increased in the following January, about a year after, to 2,643, or an increase of 18 per cent., while over the whole of Great Britain the increase was 15 per cent. That has been the effect in the motor transport industry, and it is also the effect which will be produced upon industry generally. Hon. Members opposite argue that factories are being brought here, and employment is being found, but the effect must inevitably be that the shipping and transport industries will suffer if any large measure of protective tariffs is introduced. I

    287
    know that this duty in itself is a very small thing. We were told in the Budget statement that the total sum for this year is only something like £700,000, but the underlying principle remains the same, and it is on that ground that I oppose the Clause.
    Mr. CRAWFURD: I think it would he as well if the Committee could come to a decision as to the reason for imposing this particular tax. During the Report stage of the Budget Resolutions, the Financial Secretary to the Treasury, replying to some observations that I made, was good enough to say that all I had done was to trot out the old Free Trade argument, and that, therefore, he did not propose to waste the time of the Committee in answering it, because he thought that the Committee and the House were rather tired of this line of argument. I do not quote that in order to enter a complaint against the Financial Secretary, but I want to examine this particular duty from the point of view of the Protectionist case. It does not seem to me that there is a single valid reason for this particular duty. It is true that the Financial Secretary said just now that the reasons for exempting motor tyres from the general scheme of taxation in regard to motor cars were special reasons existing at the time, and that they have now ceased to operate. It is equally true that the reasons for all these duties have ceased to operate. I am within the recollection of my right hon. Friend the Member for West Swansea (Mr. Runciman) when I say that, at the time when those duties were imposed and when tyres were exempted, neither revenue nor Protection was concerned, but what was sought was the prohibition of certain imports for certain specific reasons. If, therefore, the argument of the Financial Secretary is to hold good, that the time for the exemption has passed, that argument applies equally to the whole range of these taxes. I want to inquire into the particular reason why this tax is imposed. Is it, in fact, imposed for purposes of protection? On the occasion of the Second Reading of the Finance Bill, a speech was made by the hon. Member for Darwen (Sir F. Sanderson), in the course of which he said:
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    "The industrial world is pleased to see that the pottery industry and the motor tyre industry have received consideration at the hands of the Chancellor of the Exchequer in the presens Budget, but industrialists are disappointed to find that more use has not been made of the Safeguarding of Industries Act."—[OFFICIAL REPORT, 19th May, 1027; col. 1484, Vol. 206.]
    Mr. REMER: Hear, hear!
    7.0 p.m.
    Mr. CRAWFURD: The hon. Member for Macclesfield (Mr. Berner), as usual, reinforces my argument. There is no more useful Member of the House than the hon. Member for Macclesfield for certain purposes. I would like to put to the Chancellor of the Exchequer the simple question: Is this tax introduced from that point of view, or is it not? Is it intended and meant to be a Protective tax, or is it not? If it is meant to be a Protective tax, then I say that there is no industry, or, at any rate, there are few industries in this country which are less in need of protection than this particular industry. I know the argument of the hon. and gallant Member for Bournemouth (Sir H. Croft) about the setting up of foreign factories in this country, but let me remind him that as long as a year ago arrangements were made for setting up factories in this country by practically every one of these foreign companies. Of course, the hon. and gallant Member may say it was intelligent anticipation, but I do not think it was. I think it was the exigencies of trade. But, leaving that aside for the moment, is there any reason at all—even if one accepts the Protectionist position—or any conceivable excuse for giving a protective duty to the industry? Let me again quote the hon. Member for Darwen on the occasion of the Second Reading of the Finance Bill, when he quoted a statement made by the Chairman of the Dunlop Rubber Tyre Company at the annual meeting of that company early in this year. His quotation was as follows. It is the Chairman of the Dunlop Company who is speaking:
    "Coming down to the future, our main revenue comes from the sale of tyres, and during the first three months of the present year our sales have consistently beaten all previous records. Our principal factories are working at the greatest pressure, and it is with the greatest difficulty that they are able to meet the demands placed upon them, and exceptional efforts are being

    289
    made to relieve the situation."—[OFFICIAL REPORT 19th May, 1927; col. 1485, Vol. 206.]
    Here is an industry which has only recently undergone a drastic reconstruction after being vastly overcapitalised, which on the statement of its chairman is working at the highest possible pressure and cannot fulfil a single additional order and can hardly meet the orders it has got, and yet this is the industry which is singled out for protection.
    May I ask the indulgence of the Committee to trouble them with a very few figures dealing with the imports and exports of tyres? I am going to take five years, and I am very glad indeed that the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) is in his place, because reference has already been made to his Budget—that very good Radical Budget of 1924, and I am going to offer a further testimony. In 1922 the exports of British tyres were worth £2,000,000. The total exports, including re-exports, were —2,300,000. The total imports were —4,250,000 or, using an expression which is commonly used, the balance of trade against this country with regard to tyres was very nearly £2,000,000 in value. In 1923, the balance of trade against this country was £1,300,000. Then came the right hon. Gentleman and in 1924, for the full year, the balance of trade was £158,000 in favour of this country.
    Mr. SNOWDEN: It only operated for six months of the year in 1925.
    Mr. CRAWFURD: The next figure will confirm what the right hon. Gentleman says. The balance of trade in regard to ingoings and outgoings of tyres of all sorts in 1925 was £360,000 and in 1926 was £349,000 in our favour. There is very little doubt if it had not been for the industrial disturbances of last year that balance would have shown an increase on the year before.
    Sir H. CROFT: May I ask the hon. Gentleman to give the figures of the imports for 1924 and 1926?
    Mr. CRAWFURD: The figures of the imports for 1924, in value, is £3,037,000 and in 1926 £4,849,000. During the same two years the figures for British exports
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    were £2,730,000 in 1924, and in 1926 £4,525,000—a vastly greater increase, proportionately, than the increase in imports. If there was ever a case for the protection of an industry, it is not in regard to this industry, and I find it very hard to believe that the right hon. Gentleman is really introducing this, at any rate, in his own mind or with his own consent, as a measure of protection.
    May I turn for a moment to what the right bon. Gentleman himself said when he made his Financial Statement? After detailing with, let us say, a colourable amount of accuracy, the history of the exemption of tyres from the ordinary run of these duties, the Chancellor of the Exchequer said it was an anomaly that out of all the accessories of motor cars tyres alone should be exempted and he said:
    "I propose, alike in the interests of symmetry and revenue, to rectify this anomaly and to perfect the work of Mr. McKenna and his colleagues."—[OFFICIAL REPORT, 11th April, 1927; col. 89, Vol. 205.]
    Therefore, as far as the Chancellor of the Exchequer is concerned, it is not a question of a protective tax, but a question of a tariff in the interests of revenue and symmetry. I have not the slightest doubt, if the right hon. Gentleman sees fit to reply to this discussion, that he will have some very interesting definitions of symmetry. What he means by symmetry I do not pretend to know. I have never heard of a symmetrical tariff. I have heard of many kinds of taxes, but never of a symmetrical one. When we talk of a revenue tax we do know more what we mean and have some common ground. If this tax was imposed in the interests of revenue, then I submit to the right hon. Gentleman the simple proposition that he should have conformed to the definition of a revenue tax which he himself has offered and defended upon thousands of platforms in this country, namely, that a revenue tax should be a tax imposed not only on the foreign article which enters, but should be accompanied by a countervailing Excise duty on that which is made at home. If the figures I have produced give a true picture—and, as far as I know, they do—of the state of the tyre industry in this country, it is a monstrous thing that this particular industry should have been singled out to be helped at the expense of the rest of the country.

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    I am not going to dwell upon this point at any length, but I am going to remind the right hon. Gentleman once more of the pledge with which this Parliament began, that there should be no general attempt to introduce Protection during its lifetime, and, further, I would remind him of the subsequent words of the Prime Minister to the effect that no industry should receive any measure of protection unless by means of the machinery of the Safeguarding of Industries.
    Sir H. CROFT: And by analogous measures.
    Mr. CRAWFURD: Surely there is nothing analogous to safeguarding in this? Perhaps the hon. and gallant Member remembers the terms of the White Paper which set out the conditions, and there is nothing in the tyre industry which corresponds to those conditions by which alone any industry could even ask for a measure of protection under the safeguarding machinery. Bearing that in mind, it does seem little less than an outrage that this particular article and industry should have been singled out for a Protectionist measure. For these reasons I support the Amendment.
    Mr. HILTON: I hope the Committee will bear with me for a few moments because this is a subject which is very near to my heart, both politically and commercially. I have not heard a single argument which would prevent me from supporting this Clause. The argument used is the same old stereotyped argument that we get from the Free Trade benches. I have listened to Free Trade discussions and taken part in them for the last 17 years, and I have not heard anything new. I should like to devote myself not to the general application of Free Trade principles as regards this matter, but to its actual application to the manufacture of tyres. I am sorry that the right hon. Gentleman the Member for West Swansea (Mr. Runciman) is not in his place, because he is very keen on shipping. [HON. MEMBERS: "He is here."] It cannot make the slightest possible difference to shipping, because everything that is contained in the tyres is imported in its raw state. The composition of a tyre, speaking from a financial
    292
    standpoint, is half cotton and half rubber, both of which are imported from our Colonies or from Egypt or the United States. When that cotton or rubber has been brought to Lancashire, it is for us to make it up. The cotton is spun, and in the spinning we use the finest, strongest and best cottons that are grown in the Sudan and Egypt. To-day we in Lancashire are spinning more than ever, and I take no account of the figures of value given by the hon. Member who last spoke, because in 1921 the price of cotton was twice the price to-day and the figures are very misleading. The number of people employed in Lancashire on spinning cotton into fabric is more than twice as large as it was in 1922.
    Mr. CRAWFURD: Without a tariff.
    Mr. HILTON: It was the natural growth of engineering and the fact that motor cars are being made every week and that there are over 5,000,000 tyres used per annum. The average weight of cotton in a motor tyre is, approximately, just under 3 lbs. As a general principle, I submit that if we do not buy tyres made at home and thus keep the work at home it will be a foolhardy policy. It is better to keep your workpeople working even if you have to pay a penny more, though it is not proved in this instance that you have to pay more. Only last week a large firm—I am not advertising any particular firm—placed an order for 100,000 cotton spinning spindles and 600 looms, and the necessary preliminary machinery to erect a mill in Castleton. That will employ engineers in Lancashire and goods will be made in Castleton, thus employing another thousand Lancashire workmen on this particular job. I may point out, as has already been pointed out, that during the development of the manufacture of tyres in this country many millions of pounds have been lost by foreign competition and by dumping. I was in America in 1919 and I bought a tyre which was very satisfactory, but I came over here and bought the same tyre much more cheaply than I could buy it in America. At that time there was, near here in Middlesex, a company with £2,000,000 capital trying to make this particular tyre. That company no longer exists. There was also in Scotland

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    one which went under. I think it is the bounden duty of the Government to make the first consideration not the exact price that the wealthy man has to pay for the tyre, but that our work-people, who can make tyres which are better than any other tyres in the world, should be fully employed at high wages. I think it is the duty of all Members on this side to support this Clause.
    Lieut.-Commander BURNEY: I would like to congratulate the Chancellor of the Exchequer upon having introduced this duty on motor tyres. I pressed him last year to introduce such a duty with an object very different from that mentioned by the hon. Member for West Waltham-stow (Mr. Crawfurd), namely, with the object of getting cheaper tyres in this country. Some arguments put forward by the hon. Member for West Waltham-stow suggested that hon. Members in some cases will not take into account quantity so much as value in considering the effects of a duty. Almost the whole criterion, surely, is the actual output in numbers. If the output in numbers could be made greater, the price would naturally tend to become lower. I had a very great confirmation of that only 10 days ago, when I was talking with the president of the largest of the American motor tyre companies, who was over here selecting a factory to put down in this country because of this duty. The figures he gave me were rather startling. In his factory they have turned out 66,000 cases a day, whereas the Dunlop Company, which is by far the biggest manufacturer in this country, is doing under 16,000 cases a day, including all its American business. When you get output on that scale, it is impossible to compete unless you can manufacture in this country on something approaching the scale on which they are manufacturing in America. It was the opinion of the gentleman whom I have mentioned that it would be cheaper for him to manufacture in this country than to transport his tyres over here; that is to say, that he would not alter his price, but that he would be able to produce more cheaply. When it conies to a consideration of duties, if the Government—and I know the Chancellor of the Exchequer is a very lukewarm supporter of any duty from a protective standpoint—would really consider the kind of article, I
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    believe that if all the articles that could be manufactured by mass production methods were protected, we should not only get the articles cheaper here, but we should also greatly increase our export trade.
    Mr. LEES-SMITH: The hon. Member for Bolton (Mr. Hilton), who spoke from personal knowledge of this industry, began by saying that most of the arguments against this duty that he had heard were old, stereotyped, and antiquated. I am afraid that, in spite of the personal knowledge contained in his speech, exactly the same comments could be made upon the arguments that he used. His first argument was that, as a result of this duty, certain new factories were being established in his area, factories which, I think, represented capital coming in from abroad. The same argument was used by the Financial Secretary to the Treasury, that this duty is inducing foreign manufacturers to establish businesses in this country. How stereotyped, how familiar, how stale that argument is, and how often has the answer been given! We do not deny that, if you put a tariff upon some particular industry, you will attract capital into that industry, whether from home or from abroad, but you will do so only by inflicting a greater proportionate injury upon the other industries in the land. You can have no better example of that truth than this particular duty which we are now discussing. It is proposed to impose a duty upon the importation of motor tyres.
    The hon. Member for Bolton himself practically told us that, as a matter of fact, this is one of the most prosperous industries in this country, and that in Lancashire the amount of cotton which they were spinning for the fabric of motor tyres was twice as great as it was in 1920. That is the industry which is going to obtain the advantage, but what about the other industries of this country? What about engineering? What about iron and steel? What about cotton? What are those industries asking for? Every time any speech is made on their behalf, those industries tell us that the one thing which this House can do to assist them is to help them to lower their costs of production. They are industries dependent upon export trade, and they insist that, unless they can

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    reduce their costs of manufacture, and so bring down their prices, they cannot hold their own in the competition with rivals in foreign markets. That is our argument. What is the effect of this duty on those industries?
    Sir H. CROFT: None at all.
    Mr. LEES-SMITH: Motor tyres are practically a raw material. Directly or indirectly, motor tyres enter into the cost of production of practically every manufactured article in this country. I have worked it out in the case of some cars with which I am familiar, and I remember that the Secretary of the Automobile Association himself, when this duty was proposed, said that the duty upon quite a small horse-power car would amount to £15. What will the duty be upon motor lorries used for business purposes?
    Sir H. CROFT: Does the hon. Member suggest that the price of home-made cars has gone up?
    Mr. LEES-SMITH: The duty has been imposed only for a few weeks so far, and how can we tell until we have had some time in which to judge the results? The answer to the hon. and gallant Member has been given by the one man in this Committee who speaks from experience, and that is the hon. Member for Bolton. He did not tell us that this was going to reduce the price of motor tyres. He said, "What does it matter if you increase the price of motor tyres by a penny or so? Why should the Government consider the price of motor tyres provided you give employment to the men who are making them?" But let us take it on broader grounds. If it be true, as hon. Members argue, that a tariff on these articles is not only going to leave their price the same, but is actually going to reduce it, then why is the Safeguarding of Industries Act opened by the statement that no tariff must be imposed upon any article of food or drink? Why, in case after case, when hon. Members are introducing these Safeguarding Duties in this House, if some portion of the import is specially important, is an exception introduced into the Safeguarding Duty itself saying that that shall have no tariff put upon it?
    Sir H. CROFT: Ancient prejudice!
    Mr. LEES-SMITH: Take cutlery. When we were discussing that duty, we found a special prevision that knives that were necessary for surgical purposes and knives that were part of the material used by other industries, were to be excluded from the duty. If it is going to lower the price of those knives, why not bring them in? As a matter of fact, in the whole of the argument for a tariff which is used by hon. Members opposite, I notice that in every tariff which they draw up they lay it down that the duty shall be imposed upon fully-manufactured articles, and that semi-manufactured articles which enter into the cost of production of articles at a further stage shall be excluded. Why? If the duty is going to lower their price, why not give the whole of British industry the advantage of imposing it on semi-manufactured articles. The fact is that hon. Members themselves do not believe the arguments that they put forward. They try to convince us, and they cannot convince themselves. That, then, is the reason why we assert that it is no argument whatever to tell us that foreign manufacturers are going to set up motor-tyre factories in this country. That will only be done at the expense of the other industries, which are suffering under burdens from which the motor-tyre manufacturers are free.
    The result of this duty is very plain. Reference was made by the hon. Member for West Walthamstow (Mr. Crawfurd) to the recent speech made by the chairman of Dunlop's. They held their annual meeting a month or two ago, and I noticed that the chairman of Dunlop's, a firm which is going to get more advantage from this duty than any other firm in the land, pointed out that, in spite of the industrial difficulties and the general trade depression, he was going, as a result of last year's working, to ask the shareholders of Dunlop's to accept an increase of dividend from 15 to 20 per cent. This duty means that the great export trade of this country, which is staggering under heavy burdens and which needs assistance if any trade needs it, is going to be injured in order to add another five, 10 or 15 per cent, to the dividends of the shareholders in one of the wealthiest corporations in the world.
    Major-General Sir JOHN DAVIDSON: The hon. Member for Keighley (Mr. Lees-Smith) mentioned Dunlop's, but he did not tell the whole story, and I think it would have been only fair to mention that there was a reconstruction of the capital of that firm, and that their £1 shares were written down to 6s. 8d. I cannot believe that, the hon. Member is really serious when he suggests that a duty on tyres is going to cause an increase in the cost of production of other manufactured articles in this country. It has not done so yet, and I shall be very interested to see whether it does. I think those arguments are futile. I want to congratulate the right hon. Gentleman on bringing in this duty. What I am much more concerned about is that our working people in this country should have a reasonably good wage for a reasonably good day's work, and this duty is producing that result. Hon. Members have said that concerns have set up factories in this country but that they have done so quite irrespective of these duties. I would ask the hon. Member who has just spoken whether he is aware that Pirelli are establishing a factory in Hampshire, and whether they ever had any intention to establish a factory here before these duties were imposed. Obviously, they had not. I represent a Division of Hampshire, and I am very glad that they are putting up a factory there, and I hope that it will employ a great many people from my Division and neighbouring Divisions. I look at the question from the point of view of the prosperity of the men who get work there. In my Division there are a great many people who are out of work, and it gives me a great deal of pleasure when I see employment found in these new factories. I congratulate the right hon. Gentleman on bringing forward these duties, and hope he will extend them to many other industries. The safeguarding of industries is the one salvation of this country.
    Mr. SNOWDEN: Are we not to have a reply from the Chancellor of the Exchequer?
    Mr. CHURCHILL: We have had a very full reply. [HON. MEMBERS: "No!"] There has been a full reply to the Amendment by the Financial Secretary to the
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    Treasury, and the Debate that has taken place on the Clause itself has been of such a general character, so evenly balanced, so well contested on both sides and so free from any intrusion into any novel sphere, that I hardly thought it was necessary for me to add to the already lengthy toil which the committee have before them by making a restatement of the reasons which led to the imposing of this duty. I would not have spoken but for the stern attitude adopted by the right hon. Gentleman for Colne Valley (Mr. Snowden) in asking for my intervention. I will first give an answer to the question put by the hon. Member for Walthamstow, West (Mr. Crawfurd). He asked me whether this duty is intended to be protective. I made it perfectly plain in the speech with which I introduced this matter to the House that there is no protective intention behind the re-imposition of this duty. It is imposed for revenue purposes and it yields a revenue of £700,000. It was also imposed on the ground of dealing with what is a luxury commodity to a very large extent. In this respect, of course, we have the authority of Mr. McKenna, the right hon. Member for Swansea West (Mr. Runciman) and all the leaders of the Liberal party, who proposed this tax as part of the McKenna Duties and only omitted it from the scope of those duties in view of some very special war-time arrangements which were made with manufacturers of tyres in the United States. It is a revenue duty, and it is, to a very considerable extent, a luxury duty. It is true that, incidentally, those who hold the Protectionist theory may derive some satisfaction from the workings of this duty, because it has had the effect of bringing certain foreign firms inside the ambit of the duty, and they have started works in this country and provide much employment, which gives satisfaction to hon. Members in whose constituencies those factories are put up.
    Sir H. CROFT: And to the country as a whole.
    Mr. CHURCHILL: Yes. In addition, the mass production possibilities which are open to the great manufacturers, Dunlop's in particular, may very likely lead to diminution in the cost of production which will prevent any rise in prices in particular cases. I understand there

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    has been no increase in prices in regard to the cost of British tyres during the three months the duty has been imposed on Dunlop's tyres, except to the extent of 3⅓ per cent. of their production—in regard to a particular kind of case, to what I believe are called giant tyres—on 96⅔ per cent. of the production of Dunlop's, there has been no increase in the price, and we are deriving considerable revenue, while certain reactions of a favourable character have already manifested themselves in the labour market. In these circumstances, we are fully justified in completing the original design of the framers of the McKenna Duties, by putting this duty within the scope of the scheme.
    It would be unprofitable at this stage to endeavour to extend the area of the argument beyond this particular duty. I have no wish whatever to embark at the present time upon theoretical discussions, but there is one point which I would make. The right hon. Member for Colne Valley, when in 1925 we imposed the McKenna duties, made a striking declaration of his intention, when he had the power, to repeal them at once, as he had done before. Words of this kind spoken by the right hon. Gentleman, with the authority of his party behind him, exercise a certain depressing effect upon the industries which are subject to the McKenna duties. I am informed, on authority which cannot be disputed, that considerable extensions of the Dunlop works would be undertaken but for the apprehension that the duties may, all of a sudden, be removed, without any regard to the merits of the situation, or the prices ruling in the home market, or a general study of the labour market, that suddenly the protection which is afforded to these commodities may be removed as a political manœuvre, to gain cheap applause from this or that quarter and to cement alliance with another political faction; that for that purpose and with that object the duty may be suddenly swept away and, in consequence, the whole basis of industry be violently deranged.
    In view of this cloud of uncertainty which is hanging over the industry, some of the manufacturers, to whom hon. Members have drawn attention, are operating much more slowly than they
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    would otherwise have done. As I have been called upon by the right hon. Gentleman to intervene in this discussion, I am glad to have the opportunity of appealing to him to remove this uncertainty which hangs over the industry, and not to commit himself, because it may be many years before he is called upon to take the decision, to sweep away these duties, regardless of the interests of those who are concerned in them, employés as well as employers, and regardless also of the success or failure of the duties from the revenue as well as other points of view.
    Mr. SNOWDEN: One can understand the reluctance of the right hon. Gentleman to take part in this Debate and that he did not rise until we insisted that we should get some explanation from him. The Financial Secretary to the Treasury has a consistent Protectionist record, but the right hon. Gentleman has a past in this matter, and it must be exceedingly inconvenient for him to swallow all his previous professions. The right hon. Gentleman said that he was glad to have an opportunity of making his observations, but the funereal tone in which his explanations were made was hardly in consonance with the feelings of lightness and enthusiasm which he professed. The right hon. Gentleman says that this is a revenue duty. He admits that it has a Protective effect. He made an appeal to me that if I should ever be in a position to deal with these matters, I should not recklessly undo the work that he has done.
    Mr. CHURCHILL: My appeal to the right hon. Gentleman was, not to prejudge the decision which will be taken, if and when that situation arises, and not to prejudge it in such a way as to exercise a depressing effect upon the industry.
    Mr. SNOWDEN: I do not think, indeed I am quite certain, that anything that is likely to happen as a result of the operation of these duties is likely to demand any very close consideration in regard to them, because there are broad principles involved which would determine our action. The right hon. Gentleman is the last person in the world to advise somebody else not to take precipitate action. He says that if we repealed these duties it would be in order to cement some

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    alliance with another Parliamentary group on whose support we might have to rely. The right hon. Gentleman is the last person in the world to charge others with being actuated by motives which are not backed by conviction. He had not been in office three or four months before he repealed duties which had been imposed six or eight months before. Why did not the right hon. Gentleman then adopt the advice he now gives, and wait and see what was going to be the effect of the repeal of these duties? He did not wait. Why? Because it was necessary for him to bring forth some fruit that would prove to that party upon whose support he now depends that he was prepared to concede to them some part of their protectionist policy. The right hon. Gentleman said that he had had representations made to him of the disastrous effect that might follow if the duty upon motor tyres which he is now imposing were suddenly repealed. I know the source from which he got that information. That same source has made precisely the same suggestions or comments to me. But that same source said to me at the same time: "Ours is an industry that does not need Protection.' The right hon. Gentleman says that, although this duty may have a protective effect, his sole purpose in imposing it is revenue—incidentally, that it will give symmetry to the duty upon motor cars.
    The right hon. Gentleman is concerned about symmetry. Why cannot he give other taxes symmetry? For instance, we were discussing in an earlier part of the proceedings the duty upon tea. Associated with tea is bread and butter. Why does not the right hon. Gentleman's desire for symmetry induce him to impose for revenue purposes a duty upon corn and a duty upon butter? Why?
    Mr. CHURCHILL: Because precise pledges have been given against anything of that kind.
    Mr. SNOWDEN: I waited for that retort. There have been precise pledges, too, that there should be no duty of this kind. The right hon. Gentleman the Prime Minister said that there would be no Protection given to any industry except through the machinery of the Safeguarding of Industries, but that procedure has not been adopted in this case, for this reason—that the British motor car industry has not made a case for a duty
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    under any one of the five heads they would be required to substantiate. We have had a quotation from the speech of the chairman of the Dunlop Company, that they are so busy that they cannot take any more orders. The prosperity of that company during the past several years has been one of the romances of British industry. It is quite true that they got into financial difficulties a few years ago and had to write off two-thirds of their capital, which ought never to have been called. The nominal value of their shares to-day is 6s. 8d., but he did not tell us what was the Stock Exchange quotation of those shares. I see from the Stock Exchange Report that Dunlop shares were very active to-day, and they are standing at 34s. 6d.; that is to say, that the Stock Exchange quotation is five times more than the actual paid-up capital, and yet this is an industry which is getting Protection from this Government. What has the Prime Minister to say about it? What has he got to say about the Chancellor of the Exchequer imposing through a back-door—
    Mr. CHURCHILL: The Budget is not a back-door. It is very much a front door.
    Mr. SNOWDEN: It is by a back-door procedure, simply under the pretext of imposing a revenue duty. What has the Prime Minister to say about a proceeding like that? Is not that a violation of the right hon. Gentleman's pledges? Undoubtedly, the Chancellor of the Exchequer may say what he likes about this being a tax imposed for revenue purposes. Every speech that has been made by Members on that side of the House in the course of the Debate has welcomed this proposal as an instalment of Protection, and only, mark you, as an instalment. Practically every speech has finished with a peroration to this effect, that they hope this is only an earnest of more things that are going to come.
    The CHAIRMAN: I must the right hon. Gentleman to come to his peroration, because he is getting on ground beyond tyres. I have had to stop perorations before.
    Mr. SNOWDEN: I have no recollection of you pulling up any of the hon. Members.
    The CHAIRMAN: They sat down too quickly.
    Mr. SNOWDEN: There has been one point that has been raised by almost every speaker, and that is as to the effect the imposition of this duty will have upon the price of the manufactured article. Our Tariff Reform pundits have said that the effect will not be to cause an increase in the price with one single exception. The hon. Member for Bolton (Mr. Hilton) said it did not matter if the price were increased. Is it the contention, not merely in regard to this particular case, but it is the contention of Protectionists in this House that a duty upon the imported commodity does not increase the price of the corresponding home article? May I state in a word or two what our view of that matter is?
    "The object of protection is to encourage home industries. The means by which you attain that object is that you so arrange import duties that the prices obtained in those industries are increased. If industries are encouraged it is by raising prices. That, in a nutshell, is Protection properly understood."
    [HON MEMBERS: "No!"] Then hon. Members repudiate the greatest of living Tory statesmen, for that is a quotation from a speech by Lord Balfour. But I will call to my support the right hon. Gentleman himself. He said this afternoon, when he had to defend this duty, that an import duty did not necessarily and always raise the price of the corresponding article at home. When one of my hon. Friends said, "You are passing it on to the consumer," the right hon. Gentleman said last year—I admit it was in reply to an interjection, and perhaps he did not give the matter sufficient thought and care, hut, at any rate, when a man is thrown off his guard, the truth generally comes out—said, "Show me any tax where the consumer does not pay, and where the tax is not passed on to the consumer." That is the answer of the Chancellor of the Exchequer to his present Tariff Reform companions, and it shows that the right hon. Gentleman after all, although he may on occasion be content to give lip-service to Protection, may be compelled—of course, the right hon. Gentleman has on every occasion when he has proposed some protective Clause shown his contempt for it, and his contempt for the arguments that have been put forward by Members of his own party.
    Mr. CHURCHILL: I have no contempt for £700,000.
    Mr. SNOWDEN: He shows contempt for the protective effect of this proposal, and he has got a contempt for the arguments by which it is supported by members of his own party. Of course, this will pass, and I repeat what I said when the right hon. Gentleman proposed to re-impose the McKenna Duties. He is getting the finances of this country into such a desperate condition that his successor will be in a very difficult position indeed. It may not be possible in one Session of Parliament, and in the first Budget, to undo the mischief that the right hon. Gentleman is doing over a period of three or four years.
    Mr. CHURCHILL: Hear, hear !
    Mr. SNOWDEN: "Hear hear," the right hon. Gentleman says. That is part of the policy of this Government, not only in regard to this matter but in regard to many other matters. They are creating a situation in which any Labour Government which succeeds will have to spend perhaps one or two Sessions of Parliament in undoing the mischief that this Government has done.
    Sir F. HALL: You will not have the trouble.
    Mr. SNOWDEN: Therefore, they think that during these one or two Sessions we shall be prevented from coming out with some of the bigger and more far-reaching reforms—
    The CHAIRMAN: That is going far beyond tyres.
    Mr. SNOWDEN: I think it is relevant in this respect, that this is one of the difficulties they are putting in the way of the next Labour Government. The Chancellor of the Tory party may rely upon it, that at the first possible practical opportunity this duty and other protective duties the Government are proposing will be repealed.
    Question put, "That the Clause stand part of the Bill."
    The Committee proceeded to a Division.
    Miss WILKINSON: On a point of Order, Mr. Chairman. Can you explain to the Committee what we are proposing to do? Are we engaged in a Division?
    The CHAIRMAN: The hon. Member may only speak covered when a Division has been called.

    Division No. 219.]

    AYES.

    [8.0 p.m.

    Acland-Troyte, Lieut.-Colonel

    Fairfax, Captain J. G.

    Meyer, Sir Frank

    Agg-Gardner, Ht. Hon. Sir James T

    Falle, Sir Bertram G.

    Milne, J. S. Wardlaw

    Albery, Irving James

    Finburgh, S.

    Mitchell, S. (Lanark, Lanark)

    Alexander, E. E. (Leyton)

    Ford, Sir P. J.

    Mitchell, W. Foot (Saffron Walden)

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Forestier-Walker, Sir L.

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Amery, Rt. Hon. Leopold C. M. S.

    Foxcroft, Captain C. T.

    Moore Lieut.-Colonel T. C. R. (Ayr)

    Applin, Colonel R. V. K.

    Fraser, Captain Ian

    Moreing, Captain A. H.

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Gadie, Lieut.-Col. Anthony

    Morrison-Bell, Sir Arthur Clive

    Astbury, Lieut.-Commander F. W.

    Ganzonl, Sir John

    Nelson, Sir Frank

    Atkinson, C.

    Gates, Percy

    Neville, Sir Reginald J.

    Baldwin, Rt. Hon. Stanley

    Gault, Lieut.-Col. Andrew Hamilton

    Newman, Sir R. H. S. D. L. (Exeter)

    Balfour, George (Hampstead)

    Gibbs, Col. Rt. Hon. George Abraham

    Newton, Sir D. G. C. (Cambridge)

    Balniel, Lord

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    O'Connor, T. J. (Bedford, Luton)

    Banks, Reginald Mitchell

    Gower, Sir Robert

    O'Neill, Major Rt. Hon. Hugh

    Barnett, Major Sir Richard

    Grace, John

    Pennefather, Sir John

    Barnston, Major Sir Harry

    Grattan-Doyle, Sir N.

    Penny, Frederick George

    Beamish, Rear-Admiral T. P. H.

    Greaves-Lord, Sir Walter

    Percy, Lord Eustace (Hastings)

    Bellairs, Commander Carlyon W.

    Greene, W. P. Crawford

    Perkins, Colonel E. K.

    Benn, Sir A. S. (Plymouth, Drake)

    Grenfell, Edward C. (City of London)

    Perring, Sir William George

    Bennett, A. J.

    Grotrian, H. Brent

    Pilcher, G.

    Berry, Sir George

    Guinness, Rt. Hon. Walter E.

    Preston, William

    Betterton, Henry B.

    Gunston, Captain D. W.

    Price, Major C. W. M.

    Birchall, Major J. Dearman

    Hacking, Captain Douglas H.

    Radford, E. A.

    Blundell, F. N.

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Raine, Sir Walter

    Boothby, R. J. G.

    Hammersley, S. S.

    Rawson, Sir Cooper

    Bourne, Captain Robert Croft

    Harland, A.

    Reid, D. D. (County Down)

    Bowyer, Captain G. E. W.

    Harrison, G. J. C.

    Remer, J. R.

    Briscoe, Richard George

    Hartington, Marquess of

    Rentoul, G. S.

    Brocklebank, C. E. R.

    Harvey, Major S. E. (Devon, Totnes)

    Rhys, Hon. C. A. U.

    Brooke, Brigadier-General C. R. I.

    Haslam, Henry C.

    Rice, Sir Frederick

    Broun-Lindsay, Major H.

    Hawke, John Anthony

    Ropner, Major L.

    Buchan, John

    Headlam, Lieut.-Colonel C. M.

    Russell, Alexander West (Tynemouth)

    Bull, Rt. Hon. Sir William James

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    Rye, F. G.

    Bullock, Captain M.

    Heneage, Lieut.-Colonel Arthur P.

    Salmon, Major I.

    Burman, J. B.

    Hennessy, Major Sir G. R. J.

    Samuel, Samuel (W'dsworth, Putney)

    Burney, Lieut.-Com. Charles D.

    Herbert, Dennis (Hertford, Watford)

    Sandeman, N. Stewart

    Burton, Colonel H. W.

    Hills, Major John Waller

    Sanders. Sir Robert A.

    Butler, Sir Geoffrey

    Hilton, Cecil

    Sassoon, Sir Philip Albert Gustave D.

    Butt, Sir Alfred

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Savery, S. S.

    Cadogan, Major Hon. Edward

    HolbrooK, Sir Arthur Richard

    Shaw, R. G. (Yorks, W.R., Sowerby)

    Campbell, E. T.

    Holt, Captain H. P.

    Shepperson E. W.

    Cassels, J. D.

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Simms, Dr. John M. (Co. Down)

    Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.)

    Hope, Sir Harry (Forfar)

    Sinclair, Col. T. (Queen's Univ., Belfast)

    Cazalet, Captain Victor A.

    Hopkins, J. W. W.

    Skelton, A. N.

    Chadwick, Sir Robert Burton

    Howard-Bury, Lieut.-Colonel C. K.

    Staney, Major P. Kenyon

    Chapman, Sir S.

    Hudson, Capt. A. U. M. (Hackney, N.)

    Smith, R. W. (Aberd'n & Kinc'dine, C.)

    Chilcott, Sir Warden

    Hume, Sir G. H.

    Smith-Carington, Neville W.

    Christie. J. A.

    Huntingfield, Lord

    Somerville, A. A. (Windsor)

    Churchill, Rt. Hon. Winston Spencer

    Hurst, Gerald B.

    Spender-Clay, Colonel H.

    Churchman, Sir Arthur C.

    Jackson, Sir H. (Wandsworth, Cen'l)

    Sprot, Sir Alexander

    Clayton, G. C.

    Jacob, A. E.

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Cobb, Sir Cyril

    James, Lieut.-Colonel Hon. Cuthbert

    Steel Major Samuel Strang

    Colfox, Major Wm. Phillips

    Jephcott, A. R.

    Streatfeild, Captain S. R.

    Cooper, A. Duff

    Jones, G. W. H. (Stoke Newington)

    Stuart, Crichton-, Lord C.

    Cope, Major William

    Kidd, J. (Linlithgow)

    Stuart, Hon. J. (Moray and Nairn)

    Couper, J. B.

    Kindersley, Major Guy M.

    Sueter, Rear-Admiral Murray Fraser

    Courthope, Colonel Sir G. L.

    King, Commodore Henry Douglas

    Sugden, Sir Wilfrid

    Craig, Sir Ernest (Chester, Crewe)

    Knox, Sir Alfred

    Sykes, Major-Gen. Sir Frederick H.

    Croft, Brigadier-General Sir H.

    Lamb, J. Q

    Templeton, W. P.

    Crooke, J. Smedley (Deritend)

    Lane Fox, Col. Rt. Hon. George R.

    Thompson, Luke (Sunderland)

    Crookshank. Cpt. H. (Lindsey, Gainsbro)

    Leigh, Sir John (Clapham)

    Thomson, Rt. Hon. Sir W. Mitchell

    Dalkeith, Earl of

    Long, Major Eric

    Tinne, J. A.

    Davidson, Major-General Sir John H.

    Looker, Herbert William

    Titchfield, Major the Marquess of

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    Lougher, Lewis

    Tryon, Rt. Hon. George Clement

    Davies, Sir Thomas (Cirencester)

    Luce, Major-Gen. Sir Richard Harman

    Vaughan-Morgan Col. K. P.

    Davies, Dr. Vernon

    Lumley. L. R.

    Wallace, Captain D. E.

    Dawson, Sir Phillip

    Lynn, Sir Robert J.

    Ward, Lt.-Col. A. L.(Kingston-on-Hull)

    Dean, Arthur Wellesley

    Macdonald, R. (Glasgow, Cathcart)

    Warner, Brigadier-General W. W.

    Dixon, Captain Rt. Hon. Herbert

    McDonnell, Colonel Hon. Angus

    Warrender Sir Victor

    Drewe C.

    McLean, Major A.

    Waterhouse, Captain Charles

    Eden, Captain Anthony

    Macmillan, Captain H.

    Watson, Rt. Hon. W. (Carlisle)

    Edmondson, Major A. J.

    McNeil, Rt. Hon. Ronald John

    Wells, S. R.

    Elliot, Major Walter E.

    Makins, Brigadier-General E.

    Wheler, Major Sir Granville C. H.

    Ellis, R. G.

    Malone, Major P. B.

    Williams, A. M. (Cornwall, Northern)

    Erskine, Lord (Somerset, Weston-S.-M.)

    Manningham-Buller, Sir Mervyn

    Williams, Com. C. (Devon Torquay)

    Everard, W. Lindsay

    Mason, Lieut.-Col. Glyn K.

    Williams, Herbert G. (Reading)

    The Committee divided: Ayes, 236; Noes, 119.

    Windsor-Clive, Lieut.- Colonel George

    Womersley, W. J.

    Winterton, Rt. Hon. Earl

    Wood, Sir Kingsley (Woolwich, W.)

    TELLERS FOR THE AYES.—

    Wise, Sir Fredric

    Worthington-Evans, Rt. Hon. Sir L.

    Mr. F. C. Thomson and Captain

    Withers, John James

    Yerburgh, Major Robert D. T.

    Margesson.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Hardle, George D.

    Rose, Frank H.

    Alexander, A. V. (Sheffield, Hillsbro')

    Harris, Percy A.

    Scrymgeour, E.

    Amman, Charles George

    Hayday, Arthur

    Scurr, John

    Baker, J. (Wolverhampton, Bilston)

    Henderson, Right Hon. A. (Burnley)

    Shepherd, Arthur Lewis

    Baker, Walter

    Henderson, T. (Glasgow)

    Shiels, Dr. Drummond

    Barker, G. (Monmouth, Abertillsry)

    Hirst, G. H.

    short, Alfred (Wednesbury)

    Barnes. A.

    Hirst, W. (Bradford, South)

    Smile, Robert

    Batey, Joseph

    Hore-Bellsha, Leslie

    Smith, Ben (Bermondsey, Rotherhithe)

    Bondfield, Margaret

    Hudson, J. H. (Huddersfield)

    Smith, Rennie (Penistone)

    Bowerman, Rt. Hon. Charles W.

    Hutchison, Sir Robert (Montrose)

    Snell, Harry

    Briant, Frank

    Jenkins, W. (Glamorgan, Neath)

    Snowden, Rt. Hon. Philip

    Broad, F. A.

    John, William (Rhondda, West)

    Spencer, G. A. (Broxtowe)

    Brown, Ernest (Leith)

    Johnston, Thomas (Dundee)

    Spoor, Rt. Hon. Benjamin Charles

    Brown, James (Ayr and Bute)

    Jones, Henry Haydn (Merioneth)

    Stamford, T. W.

    Buchanan, G.

    Jones, J. J. (West Ham, Silvertown)

    Stephen, Campbell

    Buxton, Rt. Hon. Noel

    Jones, Morgan (Caerphilly)

    Stewart J. (St. Rollox)

    Charleton, H. C.

    Kelly, W. T.

    Strauss, E. A.

    Clowes, S.

    Kennedy, T.

    Sullivan, J.

    Cluse, W. S.

    Kirkwood. D.

    Thorne, W. (West Ham, Plaistow)

    Clynes, Rt. Hon. John R.

    Lansbury, George

    Thurtie, Ernest

    Connolly. M.

    Lawrence, Susan

    Townend, A. E.

    Cowan, D. M. (Scottish Universities)

    Lee, F.

    Variey, Frank B.

    Crawturd, H. E.

    Lindley, F. W.

    Viant, S. P.

    Day, Colonel Harry

    Lowth, T.

    Wallhead, Richard C.

    Dennison, R.

    Lunn, William

    Watson, W. M. (Dunfermilne)

    Dunnico. H.

    MackInder, W.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Edwards, C. (Monmouth, Bedwelity)

    MacLaren, Andrew

    Welsh, J, C.

    Fenby, T. D.

    Maclean, Nell (Glasgow, Govan)

    Wiggins, William Martin

    Gardner, J. P.

    March, S.

    Wilkinson. Eden C.

    Garro-Jones, Captain G. M.

    Morris, H. H.

    Williams. C. P. (Denbigh, Wrexham)

    Gibbins, Joseph

    Morrison, R. C. (Tottenham, N.)

    Williams, David (Swansea. E.)

    Gillett, George M.

    Mosley, Oswald

    Williams. Dr. J. H. (Llanelly)

    Gosling, Harry

    Murnin, H.

    Wilson, C. H. (Sheffield, Attercliffe)

    Graham, D. M. (Lanark, Hamilton)

    Palin, John Henry

    Wilson R. J. (Jarrow)

    Graham, Ht. Hon. Wm. (Edin., Cent.)

    Pethick-Lawrence, F. W.

    Windsor. Walter

    Grenfell, D. R. (Glamorgan)

    Ponsonby, Arthur

    Wright, W.

    Groves, T.

    Potts, John S.

    Young, Robert (Lancaster, Newton)

    Grundy. T. W.

    Riley, Ben

    Hall, F. (York, W.R., Normanton)

    Ritson, J.

    TELLERS FOR THE NOES.—

    Hall, G. H. (Merthyr Tydvil)

    Roberts, Rt. Hon. F.O.(W. Bromwich)

    Mr. Whiteley and Mr. Haves.

    Hamilton, Sir R. (Orkney & Shetland)

    Robinson, W. C. (Yorks, W.R., Elland)

    CLAUSE 4.—(Amendment with respect to duty on cinematograph films.)
    Motion made, and Question put, "That the Clause stand part of the Bill."

    Division No. 220.]

    AYES.

    [8.9 p.m.

    Acland-Troyte, Lieut.-Colonel

    Brass, Captain W.

    Cooper, A. Duff

    Agg-Gardner, Rt. Hon. Sir James T.

    Briscoe, Richard George

    Cope, Major William

    Alexander, E. E. (Leyton)

    Brocklebank, C. E. R.

    Couper, J. B.

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Brooke, Brigadier-General C. R. I.

    Courthope, Colonel Sir G. L.

    Amery, Rt. Hon. Leopold C. M. S.

    Broun-Lindsay, Major H.

    Croft, Brigadier-General Sir H.

    Applin, Colonel R. V. K.

    Buchan, John

    Crooke, J. Smedley (Derltend)

    Ashley. Lt.-Col. Rt. Hon. Wilfrid W.

    Bull, Rt. Hon. Sir William James

    Crookshank, Cpt. H. (Lindsey, Gainsbro)

    Astbury, Lieut.-Commander F. W.

    Burman, J. B.

    Dalkeith, Earl of

    Atkinson, C.

    Burton, Colonel H. W.

    Davidson, Major-General Sir John H.

    Balfour, George (Hampstead)

    Butler, Sir Geoffrey

    Davies, Sir Thomas (Cirencester)

    Balniel, Lord

    Butt, Sir Alfred

    Davies, Dr. Vernon

    Banks, Reginald Mitchell

    Cadogan, Major Hon. Edward

    Dawson, Sir Philip

    Barnett, Major Sir Richard

    Campbell, E. T.

    Dean, Arthur Wellesley

    Beamish, Rear-Admiral T. P. H.

    Cassels. J. D.

    Dixon, Captain Rt. Hon. Herbert

    Bellairs, Commander Carlyon W.

    Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)

    Drewe, C.

    Benn, Sir A. S. (Plymouth, Drake)

    Chadwick, Sir Robert Burton

    Eden, Captain Anthony

    Bennett, A. J.

    Chapman, Sir S.

    Edmondson, Major A. J.

    Berry, Sir George

    Chilcott, Sir Warden

    Elliot, Major Walter E.

    Betterton, Henry B.

    Christie, J. A.

    Ellis, R. G

    Birchall, Major J. Dearman

    Churchill, Rt. Hon. Winston Spencer

    Erskine, Lord (Somerset, Weston-s.-M.)

    Blundell, F. N.

    Churchman, Sir Arthur C.

    Everard, W. Lindsay

    Boothby, R. J. G.

    Clayton, G. C.

    Fairfax, Captain J. G.

    Bourne, Captain Robert Croft

    Cobb, Sir Cyril

    Finburgh, S.

    Bowyer, Captain G. E. W.

    Colfox, Major Wm. Phillips

    Ford, Sir P. J.

    The Committee divided: Ayes; 224; Noes, 120.

    Forestier-Walker, Sir L

    Kindersley, Major G. M.

    Rye, F. G.

    Foxcroft, Captain C. T.

    King, Commodore Henry Douglas

    Salmon, Major I.

    Fraser, Captain Ian

    Knox, Sir Alfred

    Samuel, Samuel (W'dsworth, Putney)

    Gadie, Lieut-Col. Anthony

    Lamb, J. Q.

    Sandeman, N. Stewart

    Ganzonl, sir John

    Lane Fox, Col. Rt. Hon. George R.

    Sanders, Sir Robert A.

    Gates, Percy

    Leigh, Sir John (Clapham)

    Sassoon, Sir Philip Albert Gustave D.

    Gault, Lieut.-Col. Andrew Hamilton

    Long, Major Eric

    Savery, S. S.

    Gibbs, Col. Rt. Hon. George Abraham

    Looker, Herbert William

    Shaw, R. G. (Yorks, W.R., Sowerby)

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Lougher, Lewis

    Shepperson, E. W.

    Gower, Sir Robert

    Luce, Major-Gen. Sir Richard Harman

    Simms, Dr. John M. (Co. Down)

    Grace, John

    Lumley, L. R.

    Sinclair, Col. T. (Queen's Univ., Belfst.)

    Greaves-Lord, Sir Walter

    Lynn, Sir R. J.

    Skelton, A. N.

    Greene, W. P. Crawford

    Macdonald, R. (Glasgow, Cathcart)

    Slaney, Major P. Kenyon

    Greenwood, Rt. Hn. Sir H. (W'th's'w, E)

    McDonnell, Colonel Hon. Angus

    Smith, R.W. (Aberd'n & Kinc'dine. C)

    Grenfell, Edward C. (City of London)

    McLean, Major A.

    Smith-Carington, Neville W.

    Grotrian, H. Brent

    Macmillan, Captain H.

    Somerville, A. A. (Windsor)

    Guest. Capt. Rt. Hon. F. E. (Bristol, N.)

    McNeil, Rt. Hon Ronald John

    Spender-Clay, Colonel H.

    Guinness, Rt. Hon. Walter E.

    Makins, Brigadier-General E.

    Sprot, Sir Alexander

    Gunston, Captain D. W.

    Malone, Major P. B.

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Hacking, Captain Douglas H.

    Manningham-Buller, Sir Mervyn

    Steel, Major Samuel Strang

    Hall, Lieut.-Col. sir F. (Dulwich)

    Margesson, Captain D.

    Streatfeild, Captain S. R.

    Hammersley, S. S.

    Mason, Lieut.-Colonel Glyn K.

    Stuart, Hon. J. (Moray and Nairn)

    Harland, A.

    Meyer, Sir Frank

    Sueter, Rear-Admiral Murray Fraser

    Harrison, G. J. C.

    Milne, J. S. Wardlaw

    Sugden, Sir Wilfrid

    Hartington, Marquess of

    Mitchell, S. (Lanark, Lanark)

    Templeton, W. P.

    Harvey, Major S. E. (Devon, Totnes)

    Mitchell, W. Foot (Saffron Walden)

    Thompson, Luke (Sunderland)

    Haslam, Henry C.

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Thomson, Rt. Hon. Sir W. Mitchell

    Hawke, John Anthony

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Tinne, J. A.

    Headlam, Lieut.-Colonel C. M.

    Moreing, Captain A. H.

    Titchfield, Major the Marquess of

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    Morrison-Bell, Sir Arthur clive

    Vaughan-Morcan, Col. K. P.

    Heneage, Lieut.-Col. Arthur P.

    Neville, Sir Reginald J.

    Wallace, Captain D. E.

    Hennessy, Major Sir G. R. J.

    Newman, Sir R. H. S. D. L. (Exeter)

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Herbert, Dennis (Hertford, Watford)

    O'Connor, T. J. (Bedford, Luton)

    Warner, Brigadier-General W. W.

    Hills. Major John Walter

    O'Neill. Major Rt. Hon. Hugh

    Waterhouse, Captain Charles

    Hilton, Cecil

    Pennefather, Sir John

    Watson, Rt. Hon. W. (Carlisle)

    Holbrook, Sir Arthur Richard

    Penny, Frederick George

    Wells, S. R.

    Holt, Captain H. P.

    Percy, Lord Eustace (Hastings)

    Williams, A. M. (Cornwall, Northern)

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Perkins, Colonel E. K.

    Williams, Com. C. (Devon, Torquay)

    Hope, Sir Harry (Forfar)

    Perring, Sir William George

    Williams, Herbert G. (Reading)

    Hopkins, J. W. W.

    Pilcher, G.

    Windsor-Clive, Lieut.-Colonel George

    Howard-Bury, Lieut.-Colonel C. K.

    Preston, William

    Winterton, Rt. Hon, Earl

    Hudson, Capt. A. U. M. (Hackney, N.)

    Price, Major C. W. M.

    Wise, Sir Fredric

    Hudson, R. S. (Cumberl'nd, Whiteh'n)

    Radford, E. A.

    Withers, John James

    Hume, Sir G. H.

    Raine, Sir Walter

    Womersley, W. J.

    Hunter-Weston, Lt.-Gen. Sir Aylmer

    Rawson, Sir Cooper

    Wood, B. C. (Somerset, Bridgwater)

    Huntingfield, Lord

    Rees, Sir Beddoe

    Wood, Sir Kingsley (Woolwich W.)

    Jackson, Sir H. (Wandsworth, Cen't)

    Reid. D. D. (County Down)

    Worthington-Evans, Rt. Hon. Sir L.

    Jacob, A. E.

    Remer, J. R.

    Yerburgh, Major Robert D. T.

    James, Lieut.-Colonel Hon. Cuthbert

    Rentoul, G. S.

    Jephcott, A. R.

    Rhys, Hon. C. A. U.

    TELLERS FOR THE AYES.—

    Jones, G. W. H. (Stoke Newington)

    Ropner, Major L.

    Mr. F. C. Thomson and Major Sir

    Kidd. J. (Linlithgow)

    Russell, Alexander West (Tynemouth)

    Harry Barnston.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Garro-Jones, Captain G. M.

    Kennedy, T.

    Alexander, A. V. (Sheffield, Hillsbro')

    Gibbins, Joseph

    Kirkwood, D.

    Ammon, Charles George

    Gillett, George M.

    Lansbury, George

    Baker, J. (Wolverhampton, Bilston)

    Gosling, Harry

    Lawrence, Susan

    Baker, Walter

    Graham, D. M. (Lanark, Hamilton)

    Lee. F.

    Barker, G. (Monmouth, Abertillery)

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Lindley, F. W.

    Barnes, A.

    Grenfell, D. R. (Glamorgan)

    Lowth, T.

    Batey, Joseph

    Groves, T.

    Lunn, William

    Bondfield, Margaret

    Grundy, T. W.

    Mackinder, W.

    Bowerman, Rt. Hon. Charles W.

    Hall, F. (York, W. R., Normanton)

    MacLaren, Andrew

    Briant, Frank

    Hall, G. H. (Merthyr Tydvll)

    Maclean, Neil (Glasgow, Govan)

    Broad, F. A.

    Hamilton, Sir R. (Orkney & Shetland)

    March, S.

    Brown, Ernest (Leith)

    Hardie, George D.

    Morris, R. H.

    Brown, James (Ayr and Bute)

    Harris, Percy A.

    Morrison, R. C. (Tottenham, N.)

    Buchanan, G.

    Hayday, Arthur

    Mosley, Oswald

    Buxton, Rt. Hon. Noel

    Henderson, Rt. Hon. A. (Burnley)

    Murnin, H.

    Charleton, H. C.

    Henderson, T. (Glasgow)

    Palin, John Henry

    Clowes, S.

    Hirst, G. H.

    Pethick-Lawrence, F. W.

    Cluse, W. S.

    Hirst, W. (Bradford, South)

    Ponsonby, Arthur

    Clynes, Rt. Hon. John R.

    Hore-Beilsha, Leslie

    Potts, John S.

    Connolly, M.

    Hudson, J. H. (Huddersfield)

    Riley, Ben

    Cowan, D. M. (Scottish Universities)

    Hutchison, Sir Robert (Montrose)

    Ritson, J.

    Crawfurd, H. E.

    Jenkins, W. (Glamorgan, Neath)

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Day, Colonel Harry

    John, William (Rhondda, West)

    Robinson, W. C. (Yorks, W.R., Elland)

    Dennison, R.

    Johnston. Thomas (Dundee)

    Rose, Frank H.

    Dunnico, H.

    Jones, Henry Haydn (Merioneth)

    Scrymgeour, E.

    Edwards, C. (Monmouth, Bedwellty)

    Jones, J. J. (West Ham, Silvertown)

    Scurr, John

    Fenby, T. D.

    Jones, Morgan (Caerphilly)

    Shepherd, Arthur Lewis

    Gardner, J. P.

    Kelly, W. T.

    Shiels, Dr. Drummond

    310

    311

    Short, Alfred (Wednesbury)

    Sullivan, Joseph

    Wilkinson, Ellen C.

    Smillie, Robert

    Thorne, W. (West Ham, Plaistow)

    Williams, C. P. (Denbigh, Wrexham)

    Smith, H. B. Lees (Keighley)

    Thurtle, Ernest

    Williams, David (Swansea, East)

    Smith, Rennie (Penistone)

    Townend, A. E.

    Williams, Dr. J. H. (Lianelly)

    Snell, Harry

    Varley, Frank B.

    Wlison, C. H. (Sheffield, Attercliffe)

    Snowden, Rt. Hon. Philip

    Viant, S. P.

    Wilson, R. J. (Jarrow)

    Spencer, G. A. (Broxtowe)

    Wallhead, Richard C.

    Windsor, Walter

    Spoor, Rt. Hon. Benjamin Charles

    Watson, W. M. (Dunfermline)

    Wright, W.

    Stamford, T. W.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Young, Robert (Lancaster, Newton)

    Stephen, Campbell

    Welsh, J. C.

    Stewart, J. (St. Rollox)

    Whiteley, W.

    TELLERS FOR THE NOES.—

    Strauss, E. A.

    Wiggins, William Martin

    Mr. B. Smith and Mr. Hayes.

    CLAUSE 5.—(Increased duties on wines.)
    The DEPUTY-CHAIRMAN: The Amendments on the Paper to this Clause will increase the charge and are therefore not in Order.
    Motion made, and Question proposed, "That the Clause stand part of the Bill."
    Mr. PETHICK-LAWRENCE: The main object of this Clause is to increase the duty upon wines. We on this side do not, propose to controvert the main object of the Clause, but in addition to the general increase in tax it also perpetuates and extends the principle of Imperial Preference by making a special allowance on Empire wines, and it is in regard to that aspect of it that some of us desire to say a word. This Imperial Preference dates from the time of Mr. Joseph Chamberlain, who proposed to establish an Imperial Zollverein and this preference on wine is in fact part of that original scheme. It was pointed out from the beginning that there were two great objections to an Imperial Zollverein. In the first place the Dominions were not prepared to open their ports to us, and in the second place it was realised by many people that it was not desirable to try to cement the ties of blood relationship by business bargains. From that point of view, in our opinion these taxes are objectionable and we consider firstly that the ties that bind us to the Dominions are sentimental tics, and in the second place so far as the Dominions benefit us through the preference they concede, and we quite acknowledge that they do, the right method by which we can reciprocate is not by altering our fiscal system but by giving the Dominions various advantages which are natural to our method of conducting our trade and industry and our general life. We consider that the best reciprocal action we can take is to continue the defence of the shores of the Dominions and continue the very valuable assistance we give them
    312
    through allowing them to float their loans with special advantages in our markets.
    These duties on wines, spirits and liquors are primarily revenue taxes, and it stands to reason that, any suggestion that part of the Wine Duty should be remitted in the case of wines coming from the Dominions, must be in itself a loss to our revenue. The consumer pays the additional tax. The revenue does not reap the whole of the benefit but a part that the consumer pays goes to the Colonial producer. It is open to the Chancellor to argue that though there is this loophole by which the revenue does not get the whole of what the consumer pays, nevertheless it is worth while because going, as it does, to the Colonial producer, we get a quid pro quo in the preference that is given to us. I have already attempted to show that there are other forms of quid pro quo that we might give more suited to our system than this preference that we are asked to extend in this Clause, but in addition to that I want to stress the point that there is some doubt at present whether the various Dominions, and particularly Australia, which this wine preference is largely intended to benefit, are prepared to give us a quid pro quo in the actual form of preference in that country. It is true that, from the beginning, Australia and other parts of the British Empire have frankly stated that they were Protectionist. They have frankly said, "We are not going to admit your wares free of duty but it is our permanent policy to impose a certain amount of duty in order to make good the high conditions of labour and the other high costs that we have in our country." There is a certain amount that can be said for that moderate Protectionist policy.
    But in Australia there is a move to-day to do a great deal more than that. In particular in the case of hosiery an attempt is being made to impose duties which are not by any means of that reasonable protective kind. They amount

    313
    to 50 or 60, 70 and sometimes over 100 per cent. of the cost in this country. In hosiery the Australians, by these new forms of taxation, by charging in addition to an ad valorem duty a duty of 1s. on cotton goods and half a crown on woollen and silk goods per individual garment in the case of knitted underwear, are taking action of a prohibitive character against British trade. The point we want to put to the Chancellor of the Exchequer is this. If, throwing over what we believe the sound methods of relationship between the home country and the Dominions, we are going to have this bargaining system of Preference, setting the preference that we give them against the preference that they give to our goods, are you assured that you are getting a good bargain? We do not like the matter of bargaining between blood relations. We think it is an unsound and unsatisfactory principle. But if you are going to bargain, at least we demand that your bargain should be a good one, and when we find that in the Dominions, particularly Australia, such examples of a high tariff against this country, with a small Preference it is true against other countries, but so large a tariff as to be in fact a prohibition against goods coining from this country, we say to the Chancellor, "Is it not time you discussed these things with the Dominions on the ground that unless they can meet us we ought not further to extend our Preference to them," and it is for that reason that I have raised this point on this Clause.
    Mr. CHURCHILL: The hon. Gentleman deprecated a bargain or agreement of this kind between the Mother Country and the Dominions, and spoke of the difficulties which arise when such bargains take place. We have never bargained about our preference. There is only a very limited field, in accordance with the pledges which have been given, in which preferences can be afforded. We offered, voluntarily, to the Imperial Conference in 1917 to give preference to the Dominions on all commodities in respect of which duties were imposed or might hereafter be imposed by the British Parliament for its own purposes. We made a promise that we would give that preference to the Dominions, but our list of duties is a very small one compared with the whole volume of trade. We made
    314
    that promise and undertaking, not as a matter of bargaining but out of the sincere gratitude and affection which we felt towards those Dominions who at that moment had sent armies thousands of miles across the sea to fight in the line in France and elsewhere. We are proud to carry on that policy, which, imposed and sanctioned by Parliament, automatically gives these preferences, making no bargain and seeking for no return. On the other side, there is a great desire to develop their own industries and manufactures under protective tariffs, but, apart from that, there is a great desire to buy as much produce as possible from Great Britain.
    Although it is true that the duties are so high in some cases in Australia as to be very nearly prohibitive on certain articles, yet, over the whole range of the Australian tariff, very considerable preferences are afforded to British goods, with the result that about the best customer of this country is the British subject resident in Australia. There is I think no individual who takes so largely from us of our goods as the Australian, and, therefore, I think, it is very much better that we should occupy ourselves in counting up the advantages rather than in trying to balance one side of the case against the other. We should do the best we can for each other according to our various systems.
    There is no doubt that the concession given on these Wine Duties has been gratefully received in Australia. It has undoubtedly brought assistance to the Australian wine cultivators, a proportion of whom, at any rate, are ex-service men. I was very glad indeed to take a step this year, following on the one we took in 1925. It has had the effect of encouraging the consumption of Australian wines in this country. This has been shown by a notable increase. Apparently these wines are extremely popular, and a new taste is being cultivated among the public. The consumption of these wines is very considerable and the preference affects the revenue in this respect, and it is an integral part of the general policy which we have been pursuing and to which we have set ourselves ever since 1917. It is far better that this policy should be developed, not on the basis of bargaining and hard and fast agreements. Preferences which are

    315
    given as the result of commercial treaties—as it were, hard and fast agreements—are what I have always called locked bargains. If by any chance there was any reversal of policy at the termination of this Parliament to take off the duties through which these preferences were granted—if these preferences were part of a hard and fast bargain very serious tension might arise. Whereas, if they are given freely on both sides—both doing the best they can for each other—there can be no question of the hands of Parliament being tied in any way, and, at the same time, the currents of inter-Imperial trade flow more steadily in the right direction and that good will on which we must continually rely in our Empire receives a certain fostering assistance.
    Mr. MORRIS: The right hon. Gentleman says that the preferences given are not the result of any bargaining between the Mother Country and the Dominions, and that may very well be true. But if this preference be given, as he says, in order to mark the appreciation on the part of the Mother Country of the services rendered by the Dominions during the War, then it becomes highly important that that mark of appreciation is given in such a way that if any rater Government by its action reverses the policy of the right hon. Gentleman—and some parties would certainly be pledged to do so—it is not interpreted by the Dominions as meaning that that appreciation no longer exists. This might be the cause of bitter feeling on the part of the Dominions, who might, on their part, charge the Mother Country with a breach of faith. Surely, the Mother Country ought not to express its appreciation by a policy which is not adhered to by other parties of the State. This is a very false policy. It may very well be that these duties may have to be retained in order to maintain this bond of affection. It is a fallacy of the preference case altogether, that in order to maintain the preference you have to maintain the preference duties. I confess I fall between two allegiances as far as these particular duties are concerned. I have no objection to any duties that increase the price of wines and spirits. If they have the effect of doing so, I have no objection to that result. On the other hand, it is bound to have the effect later on, not of facilitating that
    316
    good will between tae Mother Country but of increasing—if later on another party came into power and there was a reversal of this particular policy—the difficulty. For this reason, I am opposed to the proposal, and regret that these duties have been imposed to give this advantage to the Dominions.
    Mr. SCRYMGEOUR: I was wondering, when the right hon. Gentleman referred to the popularity of the importation of Australian wines, whether he had reflected on the other side of the "popularity" picture. I read in the evening papers to-night that a baronet received six months' imprisonment, and that the Judge told him that if he went in for any more of this drinking he might be rendering himself liable for murder. That raises the question to which the hon. Member for Cardigan (Mr. Morris) referred. It is frequently put forward by those who represent the temperance aspect of this question, that they do not object to the imposition of these increased duties on wines if they mean an increased price of the article. I do not follow that line of reasoning at all. If there is anything in the case presented from temperance platforms against the use of intoxicating liquors it means that their production and importation involve national disaster. To talk of binding our Imperial interests together by an agency which necessarily involves national disaster is preposterous, especially from the point of view of the Conservative party, which should be out for the conservation of the best interests of the people. Any revenue which you exact from this prolific source of revenue, no matter what amount comes to the national Exchequer, is, in my opinion, a dead loss in the highest sense of the term.
    This trade or industry is one of the mightiest financial powers in the Conservative party. It has the Conservative party tightly in its grip. They will have to break that grip, and other political parties will have to break that grip. Many men who have stood at that Box as Chancellors of the Exchequer have declared that it would be comparatively easy to find all the requisite revenue which might be involved by giving up the revenue which is now derived from intoxicating liquor. Such a policy would give a tremendous impetus to the

    317
    country at large; it would be one of the most substantial contributions that could be made to the present industrial depression and to the provision of more employment. A bottle of wine is broken on a ship when she is launched. It is used at various times in our everyday life. It is used at the marriage ceremony, and it may be used at the funeral ceremony. Almost inevitably disaster follows in its train. How can any man, speaking with any sense of deep-seated moral responsibility, talk in the way the right hon. Gentleman has about the increasing popularity of an insidious agency which cannot be introduced into the House of Commons without a licence, or into the House or Lords, or into the Lord's House, without involving that trouble which is laid down explicitly by the declaration:
    "Wine is a mocker, strong drink is raging; and whosoever is deceived thereby is not wise."
    Mr. VARLEY: I am not animated by the scruples which trouble the hon. Member for Dundee (Mr. Scrymgeour); mine is a purely business point. The Chancellor of the Exchequer is taking a narrow survey. He talks with that benign magnanimity which characterised his utterances for a continuation of this preference, but he leaves out of account altogether any question of reciprocity. The hon. Member for Leicester West (Mr. Pethick-Lawrence) said something about the origin of preference. I am not sufficiently au fait with the beginnings of preference, but I have always understood, looking at it from the British point of view, that there was something unwritten whereby we had a right to expect reciprocity. We have been told that we are getting a quid pro quo for anything we do, but if the Chancellor of the Exchequer happened to come from the particular district that I do, in which a considerable body of trade is threatened by the action of the Dominions, he would probably consider in any continuation of the policy of Imperial Preference some steps whereby he could bring to the notice of the Dominions the serious effect of their policy upon the idea of Empire. I hope, as a result of the few words that have been said to-night, that we shall be able to bring to the notice of the Dominion Parliaments the consideration that as Imperial Preference is not founded on a business bargain it cannot
    318
    be indefinitely continued if we are to expect a continuation of the policy which animates them.
    Mr. WILLIAM GRAHAM: My hon. Friend the Member for Leicester West (Mr. Pethick-Lawrence) pointed out one or two considerations which should be kept in view in discussing this matter of preference. I should not have said a single word at all in this Debate but for the line of argument which was, as I think, unfortunately adopted by the Chancellor of the Exchequer. The right hon. Gentleman indicated quite clearly that there would be some ingratitude, in the light of the sacrifices made by the Dominions and Colonies during the War, unless this particular policy was pursued and maintained. The hon. Member for Cardigan (Mr. Morris) in reply to that said that if any party later in the day in this country, for perfectly sound reasons, wanted to go back on this policy, that the argument regarding wartime gratitude would be remedied. It is important that we should have on record exactly what we think of a matter of this kind. No one on this side of the House would for a single moment minimise the sacrifices made by any section of the people, wherever they were found, during the War. While we pay the highest tribute to them, it is just as important to make it clear that, in our judgment, if this policy is to be defended at all, it must be on a strictly economic basis. I do not mean in a narrow or niggardly way at all, but on an economic basis which nevertheless contains a considerable element of generosity to the Dominions and Colonies.
    We on this side are, broadly and generally, opposed to tariffism in any shape or form, and, speaking for myself, I am rather inclined to favour Preference as against tariffs, because Preference involves a modification of the tariff system. It involves a reduction of the duties on certain classes of articles, and on that ground it may he defended. But by far the better way in which to state this case from the point of view of the Colonies and Dominions is, in the first place, to relate it to an effort to cultivate what we should call the economic field within the Empire; a problem which excites less division of opinion to-day in this House than at any time in our experience;

    319
    and, in the second place, to relate this policy to what is being attempted by the Imperial Economic Committee, and particularly at the present time by the Empire Marketing Board. That is a very much better basis for a proposition of this description, and, accordingly, I regret that the Chancellor of the Exchequer brought in the argument relating to war-time conditions, with all their hectic and artificial influences, and sought to lay that down as some kind of permanent basis for this proposition. It can never be anything of the kind, and while we on this side of the Committee are not without sympathy, and will not fail in gratitude for the sacrifices made by the Dominions, do not let us land ourselves into a form of false argument upon what is a very simple and plain economic proposition. I think it is our duty to have that on record to-night for the purposes of any Debate which may emerge in the House of Commons when, in the near future, another Government, presumably of our persuasion, is on the other side of the Table.
    Mr. McNEILL: I wish to add a very few words to those which have fallen from the right hon. Gentleman opposite. He thought it was necessary to record the opinion of himself and his friends that there should be no element in this preference system of gratitude. [HON. MEMBERS "No!"] I understood him to say that it should rest entirely on an economic basis, altogether apart from what we may call the emotional basis. He blamed my right hon. Friend the Chancellor of the Exchequer for having introduced that element in defence of the system. The party opposite have already given as clear notice as is possible to give, that if they get an opportunity they intend to do away with the system of preference which we stabilised last year. Therefore, it was hardly necessary for the right hon. Gentleman to add to the warning already given. I entirely agree with him that the main basis upon which a system of preference should rest is purely an economic one and, as he knows very well, the party to which I belong, many years before the War, advocated a system of preference or rather of reciprocity to the preference which had
    320
    already been given by the Dominions and Colonies, on a purely economic basis. We hold very strongly that, apart from any sentimental reasons, a system of preference is calculated better than any other policy we can pursue to develop inter-Imperial trade, especially having regard to the fact which is so often insisted upon that infinitely the best markets for this country in proportion to population are already the Dominions and that the prospects which they hold out are infinitely greater and more favourable to British trade than those of any other form of overseas trade.
    Therefore, we can accept the idea that the economic basis is the more important one, but we altogether decline to exclude the other. I did not hear my right hon. Friend's statement on the matter—I was not here at the moment—but I take it from the right hon. Gentleman opposite that my right hon. Friend defended the policy which we are pursuing on the ground of the great services rendered to the Empire by the Dominions. These, he thought, called for some acknowledgment in this respect as in others. I entirely endorse that view in addition to the economic view. It is true that the Dominions for many years past have been giving us a preference for which they have got no reciprocity, and I think, apart from all other views, that the great services which they rendered call for some acknowledgment and, even if it had been necessary, for some sacrifice on our part to meet them in this respect. I am glad that my right hon. Friend the Chancellor of the Exchequer has put upon record that we accept that point of view and that we intend to make the preference system a stable one as far as we can do so. If the right hon. Gentleman opposite thinks that the warning he has given will commend him and his party to Dominion opinion—I do not know whether he attaches much importance to it or not—I think he is very much mistaken. What he has said, dissociating himself entirely from the point of view of my right hon. Friend, is not, I think, likely to endear his party to opinion in the Dominions or other parts of the Empire.
    Mr. W. GRAHAM: I am sorry to intervene again, but I cannot leave the

    321
    Debate on the note on which the Financial Secretary to the Treasury has concluded his speech. I think I made it perfectly plain that we on this side had the very warmest admiration for the sacrifice made by the Dominions and Colonies and we shall continue to have that admiration but I went on to develop a point, which, apparently, the right hon. Gentleman himself accepts, namely, that we must rest this matter very largely upon an economic basis because here you are dealing, not with a mere few lines in an Act of Parliament, but with proposals which have a profound influence upon business operations in this country. May I say just a word or two in reply to the right hon. Gentleman on the mere point of our recognition of War-time sacrifices by other parts of the Empire. Even if there were no question of preference at all, we make many contributions in other directions and, not least, as the right hon. Gentleman must know, in the sphere of finance. In point of fact the market in this country has within recent times done a great deal for overseas Empire finance and I could go on to cite many other cases in which the people of this country are making contributions. They are not saying very much about it. They are doing it, partly as a duty and partly because they desire to do it. I must, however, correct at once the impression which would be left by the last few sentences of the right hon. Gentleman's speech. They do not, as I am sure he will agree on reflection, accurately represent our view on this side of the House and we must now put that fact beyond the shadow of a doubt.
    Miss WILKINSON: We on this side of the House are accustomed to the methods of Debate employed by the Chancellor of the Exchequer, who has left his colleague to "carry on." No one sticks harder to the hard economic facts than the Chancellor of the Exchequer, when he has those facts on his side, and no one is more capable of throwing in a peroration, or some kind of sentimental appeal, with his tongue in his cheek, and then leaving the matter for other people to criticise when he has gone, than is the right hon. Gentleman the Member for Epping (Mr. Churchill). I, therefore, suggest that the Chancellor of the Exchequer knew perfectly well when he made that statement, that this preference which we are giving to the
    322
    Dominions is no mere generous gesture made because of the deaths of the Dominion and Colonial soldiers in the War. No one knows better than he that it was not so. I am sure he would not insult our Dominions by suggesting that such magnificent sacrifices as were made by these lads who fought at Anzac and Gallipoli, were to be met by some pettifogging duty on wines. They are dead, and they died for an ideal. Are we going to suggest that a pettifogging thing like this, in which neither they nor their families are concerned, which is obviously a bargain, intended as a bargain and never anything else but a market bargain, between two sets of hard-fisted capitalists, is going to be in any sense the reward or recompense for what those boys did during the War? The Chancellor of the Exchequer insults the intelligence of the House of Commons if he imagines that that is the sort of thing we are going to do.
    We know, as everybody knows who has followed the discussions at the Imperial Conference or met any of the delegates, that the economic discussions there are as much a question of bargaining as any other kind of market bargaining. In this ease, as has always happened in the relations of this country with the Dominions or in our foreign policy, it is not our industrialists but our financiers who are in control. The people who wish to make the London market a favourable venue for floating loans to the Dominions are prepared to sacrifice any of our industrial interests in order to keep the London market as the favourable market for the flotation of Dominion loans. That is exactly what has happened with regard to this preference on wines. Certain of our industries are in very low water indeed. Formerly they had large markets in the Dominions and Colonies, but those markets are now practically closed by prohibitive tariffs. The hon. Member for West Leicester (Mr. Pethick-Lawrence) and the hon. Member for Mansfield (Mr. Varley) represent districts where two of those industries are carried on. The hosiery industry in particular is affected. The Australian tariff, particularly that against every kind of ladies' garment and every kind of knitted fabric, has practically closed that market to this country. It matters

    323
    nothing that a slight preference is given to us as against America, for example. Compared with the high tariff, the preference is so slight as to mean nothing in practice. The Australian market is practically closed to those goods, except the very highest qualities of them, and the very finest kinds, which cannot be manufactured in Australia. Australians with money are prepared to pay the duty in order to have the finest qualities of English goods—though the French compete with us there—but on the cheaper classes of goods, which give the largest amount of employment, especially to women workers, the tariff is prohibitive.
    If there was anything in this coming together of the Dominions and ourselves, this question of the extraordinarily high tariff against hosiery might be brought up at one of those love talks. The right hon. Gentleman the Financial Secretary says we have to look forward to the future, to a time when we shall get this new, warm homely feeling between the Dominions and ourselves—that if we leave it all to their good will, and say nothing about it, that as a result of these preferences a homely feeling will grow up which will bring about a lessening of these tariffs.
    Mr. McNEILL: I did not say anything of the sort, though I have not the least objection to the hon. Lady crediting me with those sentiments.

    Division No. 221.]

    AYES.

    [9.1 p.m.

    Acland-Troyte, Lieut.-Colonel

    Buchan, John

    Cunliffe, Sir Herbert

    Agg-Gardner, Rt. Hon. Sir James T.

    Bull. Rt. Hon. Sir William James

    Dalkeith, Earl of

    Albery, Irving James

    Bullock, Captain M.

    Davidson, Major-General Sir J. H.

    Alexander, E. E. (Leyton)

    Burman, J. B.

    Davies, Sir Thomas (Cirencester)

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Burton, Colonel H. W.

    Davies, Dr. Vernon

    Amery, Rt. Hon. Leopold C. M. S.

    Butler, Sir Geoffrey

    Dawson, Sir Philip

    Applin, Colonel R. V. K.

    Butt, Sir Alfred

    Dean, Arthur Wellesley

    Apsley, Lord

    Cadogan, Major Hon. Edward

    Dixon, Captain Rt. Hon. Herbert

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W

    Campbell, E. T.

    Drewe, C.

    Astbury, Lieut.-Commander F. W

    Cassels, J. D.

    Eden, Captain Anthony

    Atholl, Duchess of

    Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)

    Edmondson, Major A. J.

    Atkinson, C.

    Chadwick, Sir Robert Burton

    Ellis, R. G.

    Balfour, George (Hampstead)

    Chapman, Sir S.

    Elveden, Viscount

    Balniel, Lord

    Chilcott, Sir Warden

    England, Colonel A.

    Barnett, Major Sir Richard

    Christie, J. A.

    Evans, Captain A. (Cardiff, South)

    Beamish, Rear-Admiral T. P. H.

    Churchill, Rt. Hon. Winston Spencer

    Everard, W. Lindsay

    Bennett, A. J.

    Churchman, Sir Arthur C.

    Fairfax, Captain J. G.

    Berry, Sir George

    Clarry, Reginald George

    Falle, Sir Bertram G.

    Betterton, Henry B.

    Clayton, G. C.

    Finburgh, S.

    Birchall, Major J. Dearman

    Cobb, Sir Cyril

    Ford, Sir P. J.

    Boothby, R. J. G.

    Colfox, Major Wm. Phillips

    Forestier-Walker, Sir L.

    Bourne, Captain Robert Croft

    Cooper, A. Duff

    Forrest W.

    Bowyer, Capt. G. E. W.

    Cope, Major William

    Foxcroft, Captain C. T.

    Brass, Captain W.

    Couper, J. B.

    Fraser, Captain Ian

    Briscoe, Richard George

    Courthope, Colonel Sir G. L.

    Gadie, Lieut.-Col. Anthony

    Brocklebank, C. E. R.

    Croft, Brigadier-General Sir H.

    Ganzonl, Sir John

    Brooke, Brigadier-General C. R. I

    Crooke, J. Smedley (Derltend)

    Gates, Percy

    Broun-Lindsay, Major H.

    Crookshank, Cpt. H. (Lindsey, Gainsbro)

    Gauit, Lieut.-Col. Andrew Hamilton

    Miss WILKINSON: I beg the right hon. Gentleman's pardon. I was not quoting his exact words. What I meant to imply was that that was the line of the right hon. Gentleman's argument—that, looking to the future, we could feel certain that as the result of these preferences trade between the Dominions and ourselves would he increasing. So far as our experience goes, the exact opposite is happening. The Australians are developing their industries and raising tariffs, and are becoming more and more concerned to keep out as far as possible the imports from this country and other countries which compete with their own infant industries. Therefore, if the right hon. Gentleman is keenly interested in providing employment in this country, and is keenly interested in the workers of this country who, after all, put his Government into office, he would do a very good stroke of business for them if he would make it very clear, when next this question comes up for discussion, that if there are going to be preferences—I do not care for these preferences at all—there should be a quid pro quo in the shape of a reduction of the very high tariffs of the Dominions.
    Question put, "That the Clause stand part of the Bill."
    The Committee divided: Ayes, 230; Noes, 111.

    Gibbs, Col. Rt. Hon. George Abraham

    Lougher, Lewis

    Sandeman, N. Stewart

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Luce, Major-Gen. Sir Richard Harman

    Sanders, Sir Robert A.

    Gower, Sir Robert

    Lumley, L. R.

    Sassoon, Sir Philip Albert Gustave D

    Grace, John

    Lynn, Sir R. J.

    Savory, S. S.

    Greaves-Lord, Sir Walter

    Macdonald, R. (Glasgow, Cathcart)

    Shaw, R. G. (Yorks, W. R., Sowerby)

    Greene, W. P. Crawford

    McDonnell, Colonel Hon. Angus

    Sheffield, Sir Berkeley

    Greenwood, Rt. Hn. Sir H. (W'th's'w, E)

    McLean, Major A.

    Shepperson, E. W.

    Grenfell, Edward C. (City of London)

    Macmillan, Captain H.

    Simms, Dr. John M. (Co. Down)

    Grotrian, H. Brent.

    McNeill, Rt. Hon. Ronald John

    Sinclair, Col. T.(Queen'aUniv., Belfst.)

    Guest, Capt. Rt. Hon. F. E. (Bristol. N.)

    Makins, Brigadier-General E.

    Slaney, Major P. Kenyon

    Gunston, Captain D. W.

    Malone, Major P. B.

    Smith, R. W, (Aberd'n & Kinc'dine, C.)

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Manningham-Buller, Sir Mervyn

    Smith-Carington, Neville W.

    Hammersley, S. S.

    Margesson, Captain D.

    Somerville, A. A. (Windsor)

    Hanbury, C.

    Mason, Lieut.-Col. Glyn K.

    Spender-Clay, Colonel H.

    Harland, A.

    Meyer, Sir Frank

    Sprot, Sir Alexander

    Harrison, G. J. C.

    Milne, J. S. Wardlaw-

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Hartington, Marquess of

    Mitchell, S. (Lanark, Lanark)

    Steel, Major Samuel Strang

    Harvey, Major S. E. (Devon, Totnes)

    Mitchell, W. Foot (Saffron Walden)

    Streatfeild, Captain S. R.

    Haslam, Henry C.

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Stuart, Hon. J. (Moray and Nairn)

    Hawke, John Anthony

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Sueter, Rear-Admiral Murray Fraser

    Headlam, Lieut.-Colonel C. M.

    Moreing, Captain A. H.

    Sugden, Sir Wilfrid

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    Morrison-Bell, Sir Arthur Clive

    Templeton, W. P.

    Heneage. Lieut.-Col. Arthur P.

    Murchison, Sir Kenneth

    Thompson, Luke (Sunderland)

    Hennessy, Major Sir G. R. J.

    Neville, Sir Reginald J.

    Thomson, F. C. (Aberdeen, South)

    Herbert, Dennis (Hertford, Watford)

    Newman, Sir R. H. S. D. L. (Exeter)

    Thomson, Rt. Hon. Sir W. Mitchell-

    Hills, Major John Waller

    O'Connor, T. J. (Bedford, Luton)

    Tinne, J. A.

    Hilton, Cecil

    O'Neill, Major Rt. Hon. Hugh

    Titchfield, Major the Marquess of

    Holt, Captain H. P.

    Oman, Sir Charles William C.

    Vaughan-Morgan, Col. K. P.

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Pennefather, Sir John

    Wallace, Captain D. E.

    Hope, Sir Harry (Forfar)

    Percy, Lord Eustace (Hastings)

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Hopkins, J. W. W.

    Perkins, Colonel E. K.

    Warner, Brigadier-General W. W.

    Howard-Bury, Lieut.-Colonel C. K.

    Perring, Sir William George

    Waterhouse, Captain Charles

    Hudson, Capt. A. U. M. (Hackney, N)

    Pilcher, G.

    Watson, Rt. Hon. W. (Carlisle)

    Hume, Sir G. H.

    Preston, William

    Wells, S. R.

    Hunter-Weston, Lt.-Gen. Sir Aylmer

    Price, Major C. W. M.

    Williams, A. M. (Cornwall, Northern)

    Huntingfield, Lord

    Radford, E. A.

    Williams, Com. C. (Devon, Torquay)

    Jackson, Sir H. (Wandsworth, Cen'l)

    Raine, Sir Walter

    Williams, Herbert G. (Reading)

    Jacob, A. E.

    Rawson, Sir Cooper

    Wingsor-Clive, Lieut.-Colonel George

    James, Lieut.-Colonel Hon. Cuthbert

    Rees, Sir Beddoe

    Winterton, Rt. Hon. Earl

    Jephcott, A. R.

    Reid, D. D. (County Down)

    Wise, Sir Fredric

    Jones G. W. H. (Stoke Newington)

    Remer, J. R.

    Withers, John James

    Kidd, J. (Linlithgow)

    Rentout, G. S.

    Womersley, W J.

    Kindersley, Major G. M.

    Rhys, Hon. C. A. U.

    Wood, B. C. (Somerset. Bridgwater)

    King, Commodore Henry Douglas

    Rice, Sir Frederick

    Wood, Sir Kingsley (Woorwich, W.).

    Knox, Sir Alfred

    Robinson, Sir T. (Lanes., Stretford)

    Worthington-Evans, Rt. Hon. Sir L.

    Lamb, J. O.

    Ropner, Major L.

    Yerburgh, Major Robert D. T.

    Lane Fox, Col. Rt. Hon. George R.

    Russell, Alexander West-(Tynemouth)

    Leigh, Sir John (Clapham)

    Rye, F. G.

    TELLERS FOR THE AYES.—

    Long, Major Eric

    Salmon, Major I.

    Major Sir Harry Barnston and Mr.

    Looker, Herbert William

    Samuel, Samuel (W'dsworth, Putney)

    Penny.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Lunn, William

    Alexander, A. V. (Sheffield, Hillsbro')

    Grenfell, D. R. (Glamorgan)

    Mackinder, W.

    Ammon, Charles George

    Groves, T.

    MacLaren, Andrew

    Baker, J. (Wolverhampton, Bilston)

    Grundy, T. W.

    Maclean, Nell (Glasgow, Govan)

    Baker, Walter

    Hall, F. (York, W. R., Normanton)

    March, S.

    Barker, G. (Monmouth, Abertillery)

    Hall G. H. (Merthyr Tydvil)

    Morrison, R. C. (Tottenham, N.)

    Barnes, A.

    Hamilton, Sir R. (Orkney & Shetland)

    Mosley, Oswald

    Batey, Joseph

    Harris, Percy A.

    Murnin, H.

    Bondfield, Margaret

    Hayday, Arthur

    Naylor, T. E.

    Bowerman, Rt. Hon. Charles W.

    Hayes, John Henry

    Palin, John Henry

    Broad, F. A.

    Henderson, Rt. Hon. A. (Burnley)

    Pethick-Lawrence, F. W.

    Brown, Ernest (Leith)

    Henderson, T. (Glasgow)

    Ponsonby, Arthur

    Brown, James (Ayr and Bute)

    Hirst, G. H.

    Potts, John S.

    Buchanan, G.

    Hirst, W. (Bradford, South)

    Riley, Ben

    Buxton, Rt. Hon. Noel

    Hora-Bellsha, Leslie

    Ritson, J.

    Charleton, H. C.

    Hudson, J. H. (Huddersfield)

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Clowes, S.

    Jenkins, W. (Glamorgan, Neath)

    Robinson, W. C. (Yorks. W. R., Elland)

    Cluse, W. S.

    John, William (Rhondda, West)

    Rose, Frank H.

    Clynes, Rt. Hon. John R.

    Johnston, Thomas (Dundee)

    Scurr, John

    Connolly, M.

    Jones, Henry Haydn (Merioneth)

    Shepherd, Arthur Lewis

    Cowan, D. M. (Scottish Universities)

    Jones, J. J. (West Ham, Silvertown)

    Shiels, Dr. Drummond

    Day, Colonel Harry

    Jones, Morgan (Caerphilly)

    Short, Alfred (Wednesbury)

    Dennison, R.

    Jones, T. I. Mardy (Pontypridd)

    Smillie, Robert

    Dunnico, H,

    Kelly, W. T.

    Smith, Ben (Bermondsey, Rotherhlthe)

    Edwards, C. (Monmouth, Bedwellty)

    Kennedy, T.

    Smith, H. B. Lees-(Keighley)

    Gardner, J. P.

    Kirkwood. D.

    Snell, Harry

    Garro-Jones, Captain G. M.

    Lansbury, George

    Snowden, Rt. Hon. Philip

    Gibbins, Joseph

    Lawrence, Susan

    Stamford, T. W.

    Gillett, George M.

    Lee, F.

    Stephen, Campbell

    Gosling, Harry

    Lindley, F. W.

    Stewart, J. (St. Rollox)

    Graham, D. M. (Lanark, Hamilton)

    Lowth, T.

    Sullivan, Joseph

    326

    327

    Thorne, W. (West Ham, Pialstow)

    Welsh, J. C.

    Wilson, C. H. (Sheffield, Attercliffe)

    Thurtle, Ernest

    Whiteley, W.

    Wilson, R. J. (Jarrow)

    Townend, A. E.

    Wiggins, William Martin

    Windsor, Walter

    Varley, Frank B.

    Wilkinson, Ellen C.

    Young, Robert (Lancaster, Newton)

    Viant, S. P.

    Williams, C. P. (Denbigh, Wrexham)

    Watson, W. M. (Dunfermline)

    Williams, David (Swansea, East)

    TELLERS FOR THE NOES.—

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Williams, Dr. J. H. (Lianelly)

    Mr. Briant and Mr. Morris.

    CLAUSE 6.—(Excise Duty on Sweets.)
    Motion made, and Question proposed, "That the Clause stand part of the Bill."
    Miss WILKINSON: Can we have some explanation from the Financial Secretary as to what is meant by sweets in this case. I know it does not mean sweets of the feminine sort such as chocolates or eatables, but I would like to know if the term includes as sweets such things as unfermented fruit juice and wines.
    Mr. McNEILL: The word "sweets" has been defined under the Finance Act of 1910, as follows:

    Division No. 222].

    AYES.

    [9.12 p.m.

    Acland-Troyte, Lieut.-Colonel

    Cope, Major William

    Harland, A.

    Agg-Gardner, Rt. Hon. Sir James T.

    Couper, J. B.

    Harrison, G. J. C.

    Albery, Irving James

    Courthope, Colonel Sir G. L.

    Hartington, Marquess of

    Alexander, E. E. (Leyton)

    Croft, Brigadier-General Sir H.

    Harvey. Major S. E. (Devon, Totnes)

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Crooke, J. Smedley (Deritend)

    Haslam, Henry C

    Amery, Rt. Hon. Leopold C. M. S.

    Crookshank, Cpt. H. (Lindsey, Gainsbro)

    Hawke, John Anthony

    Applin, Colonel R. V. K.

    Cunliffe, Sir Herbert

    Headlam, Lieut.-Colonel C. M.

    Apsley, Lord

    Dalkeith, Earl of

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Davidson, Major-General Sir J. H.

    Heneage, Lieut.-Col. Arthur P.

    Astbury, Lieut.-Commander F. W.

    Davies, Sir Thomas (Cirencester)

    Henn, Sir Sydney H.

    Atholl, Duchess of

    Davies, Dr. Vernon

    Hennessy, Major Sir G. R. J.

    Atkinson, C.

    Dawson, Sir Philip

    Hills, Major John Waller

    Balfour, George (Hampstead)

    Dean, Arthur Wellesley

    Hilton, Cecil

    Balniel, Lord

    Dixon, Captain Rt. Hon. Herbert

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Burnett, Major Sir Richard

    Drewe, C.

    Holt, Captain H. P.

    Beamish, Rear-Admiral T. P. H.

    Eden, Captain Anthony

    Hope, Capt. A O. J. (Warw'k, Nun.)

    Bennett. A. J.

    Edmondson, Major A. J.

    Hope, Sir Harry (Forfar)

    Berry, Sir George

    Ellis, R. G.

    Hopkins, J. W. W.

    Betterton, Henry B.

    Elveden, Viscount

    Howard-Bury, Lieut.-Colonel C. K.

    Birchall, Major J. Dearman

    England, Colonel A.

    Hudson, Capt. A. U, M. (Hackney, N.)

    Boothby, R. J. G.

    Evans, Captain A. (Cardiff, South)

    Hume, Sir G. H.

    Bourne, Captain Robert Croft

    Everard, W. Lindsay

    Hunter-Weston, Lt.-Gen. Sir Aylmer

    Bowyer, Capt. G. E. W.

    Fairfax, Captain J. G.

    Huntingfield, Lord

    Braithwaite, Major A. N.

    Falle, Sir Bertram G.

    Jackson, Sir H. (Wandsworth, Cen'l)

    Brass, Captain W.

    Fielden, E. B.

    Jacob, A. E.

    Briscoe, Richard George

    Finburgh, S.

    James, Lieut.-Colonel Hon. Cuthbert

    Brocklebank, C. E. R.

    Ford, Sir P. J.

    Jephcott, A. R.

    Brooke, Brigadier-General C. R. I.

    Forestier-Walker, Sir L.

    Jones, G W. H. (Stoke Newington)

    Broun-Lindsay, Major H.

    Forrest, W.

    Kidd, J. (Linlithgow)

    Buchan, John

    Foxcroft, Captain C. T.

    Kindersley, Major Guy M.

    Buckingham, Sir H.

    Fraser, Captain Ian

    King, Commodore Henry Douglas

    Bull, Rt. Hon. Sir William James

    Gadie, Lieut.-Col. Anthony

    Knox, Sir Alfred

    Bullock, Captain M.

    Ganzonl, Sir John

    Lamb, J. Q

    Burman, J. B.

    Gates, Percy

    Lane Fox, Col. Rt. Hon. George R.

    Burton, Colonel H. W.

    Gauit, Lieut.-Col. Andrew Hamilton

    Long, Major Eric

    Butler, Sir Geoffrey

    Gibbs, Col. Rt. Hon. George Abraham

    Looker, Herbert William

    Butt, Sir Alfred

    Glimour, Colonel Rt. Hon. Sir John

    Lougher, Lewis

    Cadogan, Major Hon. Edward

    Gower, Sir Robert

    Luce, Major-Gen. Sir Richard Harman

    Campbell, E. T.

    Grace, John

    Lumley, L. R.

    Cassels, J. D.

    Graham, Fergus (Cumberland, N.)

    Lynn, Sir. R. J.

    Cayzer, Maj. Sir Herbt. R. (Prtsmth.S. )

    Greaves-Lord, Sir Walter

    Macdonald, R. (Glasgow, Cathcart)

    Chadwick, Sir Robert Burton

    Greene, W. P. Crawford

    McDonnell, Colonel Hon. Angus

    Chapman, Sir S.

    Greenwood, Rt. Hn. Sir H. (W'th's'w, E.)

    McLean, Major A.

    Christie, J. A.

    Grenfell, Edward C. (City of London)

    Macmillan, Captain H.

    Churchill, Rt. Hon. Winston Spencer

    Grotrian, H. Brent

    McNeill, Rt. Hon. Ronald John

    Churchman, Sir Arthur C.

    Guest, Capt. Rt. Hon. F. E. (Bristol, N.)

    Makins, Brigadier-General E.

    Clayton, G. C.

    Gunston, Captain D. W.

    Malone, Major P. B.

    Cobb, Sir Cyril

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Manningham-Buller, Sir Mervyn

    Colfox, Major Wm. Phillips

    Hammersley, S. S.

    Margesson, Captain D.

    Cooper, A. Duff

    Hanbury, C.

    Mason, Lieut-Col. Glyn K.

    "The expression 'sweets' means any liquor which is made from fruit and sugar, or from fruit or sugar mixed with any other material and which has undergone a process of fermentation in the manufacture thereof, and includes British wines, made wines, mead, and metheglin."
    In case the hon. Member does not understand the last two terms, I may explain that they are ancient drinks made of honey which at one time were very popular in this country.
    Question put, "That the Clause stand part of the Bill."
    The Committee divided: Ayes, 230; Noes, 113.

    Meyer, Sir Frank

    Rhys, Hon. C. A. U.

    Templeton, W. P.

    Milne, J. S. War Slaw-

    Rice, Sir Frederick

    Thompson, Luke (Sunderland)

    Mitchell, S. (Lanark, Lanark)

    Robinson, Sir T. (Lanes., Stratford)

    Thomson, F. C. (Aberdeen, South)

    Mitchell, W. Foot (Saffron Walden)

    Hopner, Major L.

    Thomson, Rt. Hon. Sir W. Mitchell-

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Russell, Alexander West (Tynemouth)

    Tinne, J. A.

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Rye, F. G.

    Titchfield, Major the Marquess of)

    Moreing, Captain A. H.

    Salmon, Major I.

    Wallace, Captain D. E.

    Morrison-Bell, Sir Arthur Clive

    Samuel, Samuel (W'dsworth, Putney)

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Murchison, Sir Kenneth

    Sandeman, N. Stewart

    Warner, Brigadier-General W. W.

    Nelson, Sir Frank

    Sanders, Sir Robert A.

    Waterhouse, Captain Charles

    Neville, Sir Reginald J.

    Sassoon, Sir Philip Albert Gustave D.

    Watson, Rt. Hon. W. (Carlisle)

    Newman, Sir R. H, S. D. L. (Exeter)

    Savery, S. S.

    Wells, S. R.

    O'Neill, Major Rt. Hon. Hugh

    Shaw, R. G. (Yorks, W. R., Sowerby)

    Williams, A. M. (Cornwall, Northern,

    Oman, Sir Charles William C.

    Sheffield, Sir Berkeley

    Williams, Com. C. (Devon, Torquay)

    Pennefather, Sir John

    Shepperson, E. W.

    Williams, Herbert G. (Reading)

    Percy, Lord Eustace (Hastings)

    Simms, Dr. John M. (Co. Down)

    Windsor-Clive, Lieut.-Colonel George

    Perkins, Colonel E. K.

    Sinclair, Col. T. (Queen's Univ., Belfast)

    Winterton. Rt. Hon. Earl

    Perring, Sir William George

    Slaney, Major P. Kenyon

    Wise, Sir Fredric

    Plicher, G.

    Smith. R. W. (Aberd'n & Klnc'dine, C.)

    Withers, John James

    Pownali, Sir Assheton

    Smith-Carington, Neville W.

    Womersley, W. J.

    Price, Major C. W. M.

    Somerville, A. A. (Windsor)

    Wood, B. C. (Somerset, Bridgwater)

    Radford, E. A.

    Spender-Clay, Colonel H.

    Wood, Sir Kingsley (Woolwich, W.)

    Raine, Sir Walter

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Worthington-Evans, Rt. Hon. Sir L.

    Rawson, Sir Cooper

    Steel, Major Samuel Strang

    Yerburgh, Major Robert D. T.

    Rees, Sir Beddoe

    Streatfelid, Captain S. R.

    Reid, D. D. (County Down)

    Stuart, Hon. J. (Moray and Nairn)

    TELLERS FOR THE AYES—

    Remer, J. R.

    Sueter, Rear-Admiral Murray Fraser

    Major Sir Harry Barnston and Mr.

    Rentoul, G. S.

    Sugden, Sir Wilfrid

    Penny.

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Hall, G. H. (Merthyr Tydvil)

    Riley, Ben

    Alexander, A. V. (Sheffield, Hillsbro')

    Hamilton, Sir R. (Orkney & Shetland)

    Ritson, J.

    Ammon, Charles George

    Hayday, Arthur

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Baker, J. (Wolverhampton, Bilston)

    Hayes, John Henry

    Robinson, W. C. (Yorks, W. R., Elland)

    Baker, Walter

    Henderson, Right Hon. A. (Burnley)

    Rose, Frank H.

    Barker, G. (Monmouth, Abertillery)

    Henderson, T. (Glasgow)

    Salter, Dr. Alfred

    Barnes, A.

    Hirst, G. H.

    Scurr, John

    Batey, Joseph

    Hirst, W. (Bradford, South)

    Shepherd, Arthur Lewis

    Bondfield, Margaret

    Hore-Beilsha, Leslie

    Shiels, Dr. Drummond

    Bowerman, Rt. Hon. Charles W.

    Hudson, J. H. (Huddersfield)

    Short, Alfred (Wednesbury)

    Briant, Frank

    Jenkins, W. (Glamorgan, Neath)

    Smillie, Robert

    Broad, F. A.

    John, William (Rhondda, West)

    Smith, H. B. Lees (Keighley)

    Brown, Ernest (Leith)

    Johnston, Thomas (Dundee)

    Snell, Harry

    Brown, James (Ayr and Bute)

    Jones, Henry Haydn (Merioneth)

    Snowden, Rt. Hon. Philip

    Buchanan, G.

    Jones, J. J. (West Ham, Slivertown)

    Stamford, T. W.

    Buxton, Rt. Hon. Noel

    Jones, Morgan (Caerphilly)

    Stephen, Campbell

    Charleton. H. C.

    Jones, T. I. Mardy (Pontypridd)

    Stewart, I. (St. Rollox)

    Clowes, S.

    Kelly, W. T.

    Sullivan, J.

    Cluse, W. S.

    Kennedy, T.

    Thorne, W. (West Ham, plaistow)

    Clynes, Rt. Hon. John R.

    Kirkwood, D.

    Thurtle, Ernest

    Connolly, M.

    Lansbury, George

    Townend, A. E.

    Cowan, D. M. (Scottish Universities)

    Lawrence, Susan

    Variey, Frank B.

    Day, Colonel Harry

    Lee, F.

    Viant, S. P.

    Dennison, R.

    Lindley, F. W.

    Watson, W. M. (Dunfermline)

    Dunnico, H.

    Lowth, T.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Edwards, C. (Monmouth, Bedwellty)

    Lunn, William

    Welsh, J. C.

    Edwards, J. Hugh (Accrington)

    Mackinder, W.

    Wiggins, William Martin

    Gardner, J. P.

    MacLaren, Andrew

    Wilkinson, Ellen C.

    Garro-Jones, Captain G. M.

    Maclean, Neil (Glasgow, Govan)

    Williams, C. P. (Denbigh, Wrexham)

    Gibbins, Joseph

    March, S.

    Williams, David (Swansea, East)

    Gillett, George M.

    Morris, R. H.

    Williams, Dr. J. H. (Lianelly)

    Gosling, Harry

    Morrison, R. C. (Tottenham, N.)

    Wilson, C. H. (Sheffield, Attercliffe)

    Graham, D. M. (Lanark, Hamilton)

    Mosley, Oswald

    Wilson, R. J. (Jarrow)

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Murnin, H.

    Windsor, Walter

    Greenwood, A. (Nelson and Colne)

    Naylor, T. E.

    Young, Robert (Lancaster, Newton)

    Grenfell, D. R. (Glamorgan)

    Palin, John Henry

    Groves, T.

    Pethick-Lawrence, F. W.

    TELLERS FOR THE NOES.—

    Grundy, T. W.

    Ponsonby, Arthur

    Mr. Whileley and Mr. B. Smith.

    Hall, F. (York, W. R., Normanton)

    Potts, John S.

    CLAUSE 7.—(Duties and drawbacks on tobacco.)
    Mr. MOSLEY: I beg to move, in page 4, line 4, after the word "twenty-seven," to insert the words "until the twelfth day of April, nineteen hundred and twenty-eight."
    330
    During a previous stage of this Measure, hon. and right hon. Friends of mine argued with very great force, and their arguments were never answered, that this new Tobacco Duty constitutes a very clear instance of that class and discriminating taxation which the present Government, throughout its tenure of

    331
    office, has seen fit to impose. Figures produced by the Colwyn Committee were adduced in those Debates to show that the Tobacco Duty was in fact levied in almost exactly inverse proportion to the ability to pay, and, with this wealth of new facts and new figures in support of those contentions, the Government spokesmen found it somewhat difficult to answer those broad considerations. On a limited Amendment of the character of that which I am now moving, it will, perhaps, be more appropriate if I deal with the precise operation of this tax as experience has shown its development to date, and as we may anticipate its future operation for the rest of this year.
    At a previous stage of this Measure, I drew the right hon. Gentleman's attention to the possibility, and, indeed, as it seemed to be, the fact, that the great tobacco companies, in respect at least of pipe tobacco, were actually making additional profits on the excuse of handing on taxation to the consumer. That argument was based upon the fact that, after tobacco has entered this country, extra moisture is added to the tobacco during the process of manufacture. That is not an illegitimate operation in itself; it is a necessary operation to render the tobacco fit for smoking. But it appears from this fact that, when extra moisture is added during the process of manufacture, the tobacco has increased in bulk when it is handed over the counter for sale to the consumer. Tobacco is imported into this country with a moisture content of some 10 per cent. on an average. During the process of manufacture, an extra 20 per cent. of moisture, in the low-grade tobaccos, is added. It is thus apparent that, for 16 ounces of tobacco which enter the country, and on which the great companies pay tax to the Exchequer, they actually sell 19 ounces of tobacco over the counter to the consumer, and from this consideration arises the substantial point that if, in respect of each ounce of tobacco which they sell, the big companies are handing on the ½d. of taxation per ounce which they pay to the Exchequer in respect of the original tobacco which they introduce, they are, in fact, handing on to the consumer even more, than the amount which they have paid to the Exchequer.
    The right hon. Gentleman challenged the whole basis of my argument by telling
    332
    me that I laboured under entire ignorance of the facts, and that I was under a misapprehensian as to the whole process of the manufacture of tobacco. But, unfortunately for the right hon. Gentleman, an authority of the very highest character saw fit to animadvert upon his observations in a letter to the "Times." Sir Arthur Tedder wrote a letter to the "Times" which entirely destroyed the fabric of the right hon. Gentleman's argument, and, to my great surprise, I found that I was quite right and the right bon. Gentleman was quite wrong. Sir Arthur Tedder is an authority on this subject. He was Chief Inspector of Excise and Customs, from 1906 to 1911, and a Commissioner of Customs and Excise from 1911 to 1918; and, as he entered the Inland Revenue Department originally in the year 1871, his knowledge and authority on these subjects are probably second to none in the country. It might be worth while reading this very brief letter of comment on the right hon. Gentleman's remarks. He wrote to the "Times" in the following terms:
    "In your report of the Debate upon the Budget Resolutions on Wednesday, Mr. McNeill, replying for the Government, is stated to have made the following remarks on the subject of the Tobacco Duty:
    'The hon. Gentleman (Mr. Mosley) spoke about moisture being added. There was never any addition of moisture. Tobacco leaf naturally contained moisture. It was a question, not so much of adding moisture as of eliminating it.'
    Sir Arthur proceeds to comment on the statement of the right hon. Gentleman:
    "It is a pity that the Minister should have been so ignorant of the facts."
    Civil servants are accustomed to the use of euphemistic language, and he proceeds to, suggest to the Minister that he might look at the article on tobacco in the "Encyclopædia Britannica" for some elementary information on the subject. Sir Arthur proceeds
    "Added moisture is an absolute necessity in the manufacture of tobacco; it is not added simply for the purpose of profit; the law, however, steps in to safeguard the consumer by limiting the percentage of moisture which may remain in the tobacco when ready for sale."
    In another letter Sir Arthur points out that when the tobacco enters the country it contains about 10 per cent. while in the process of manufacture some further 20 per cent. is added, making a moisture content of 30 per cent. Let us observe

    333
    the actual effect of this process. We are told, and it was generally admitted in the Debate on the Budget Resolutions, that in respect of pipe tobacco, anyhow, the full extra tax of 8d. a lb or a halfpenny per ounce had been handed on to the consumer. The right hon. Gentleman did not make any excuse or attempt to defend the position of the Government in this matter. He said it was perfectly right that indirect taxation should be handed on to the consumer, and that was what indirect taxation was for. It is true that in another portion of his speech he tried to pooh-pooh that, saying that in respect of cigarettes it had not been handed on but had been paid by the companies. But in trying to have the best of both worlds, he admitted that it was probable and just that the taxation had been handed on. In relation to pipe tobacco, at any rate, it was universally admitted that the whole tax of one halfpenny per ounce had been handed on to the consumer.
    If that be so, it means that these companies are making large extra profits, because the Treasury have seen fit to tax tobacco. See how it works out. The tobacco comes in at the port, and a tax of 8d. per lb. is imposed on it when it contains only 10 per cent. of moisture. During the process of manufacture, that 16 ounces is transformed into 19 ounces. If that 19 ounces is then handed over to the consumer with an extras charge of one halfpenny per ounce, the company is getting back from the consumer 9½d. in respect of that 19 ounces for every 8d. which it has paid out in respect of the original 16 ounces imported. Thus, on every pound of tobacco, as a result of this taxation, if my argument be correct, the companies are making an extra 1½d. profit. It is very easy by a simple calculation to show how greatly augmented the profits of the companies must be on this basis. Every penny of this taxation brings in £425,000, that is to say, each penny per lb. Therefore, the extra 1½d. per lb. would bring in an extra profit of £637,000.
    That is a most extraordinary situation. It really is a most extraordinary condition of affairs if the imposition of the tax, which the right hon. Gentleman suggests the consumer should properly pay, is made the subject of extra profits for the great companies at the expense of the unfortunate consumer by whom the
    334
    additional tax has already been paid, and the Government have no remedy or device to deal with profiteering of this kind. This actual consideration of the operation of the tax seems most appropriate to this Amendment, and I hope that the right hon. Gentleman will be able to deal in detail with it and, after consulting the Encyclopædia Britannica, with rather more information than was in his possession last time, and that he may be able to tell us whether, in his opinion, this profiteering is actually taking place and what measures he can suggest to arrest its progress. I am sorry that we have had in regard to this Debate to summon to our aid in the public Press the weight and authority of ex-civil servants to correct the information of the right hon. Gentleman, and I trust that after perusing that letter, and after consulting with his expert advisers, he is now in a position to correct his previous misapprehension, and to inform the Committee upon the subject which is committed to his charge.
    The DEPUTY-CHAIRMAN: The Committee will realise that the actual Amendment is a somewhat narrow point as to whether the tax should be an annual one instead of a permanent one, but I have allowed the hon. Member to speak on the whole Clause, as it may meet the wishes of the Committee to discuss it on this Amendment rather than on Clause 7 standing part of the Bill.
    Mr. MOSLEY: On a point of Order. I endeavoured specifically to confine my observations to the operation of the tax with a view to suggesting, that it should have a limited period of trial, as suggested in the Amendment. I was very careful not to deal with any broad question of principle, which I thought would be raised by other of my hon. Friends on the question of the Clause as a whole, and I merely dealt with the operation of the tax on administrative grounds.
    Mr. STEPHEN MITCHELL: It is not often that I intervene in these Debates, but I feel compelled to-night to speak on this Clause dealing with tobacco, and I do so for two reasons, first, because it is probably well known to some hon. Members that by birth, and formerly by occupation, I am not unconnected with the tobacco trade, and, secondly, because wish to correct some rather inaccurate

    335
    statements, doubtless unintentional, but foolish, made in the Debate on the Budget dealing with the tobacco question. I wish to be perfectly fair, and to say that these inaccuracies to which I refer were not confined by any manner of means to any one side of the Committee. They were doubtless made partly through ignorance and partly through Members not taking the trouble to confirm the information they had received or the rumours which they had heard. The Chancellor of the Exchequer has given a gigantic bill for the tobacco world to face. This bill, undoubtedly, could, quite honestly and logically, have been passed on to the consumer, but I am glad to say that to the very large extent of some 75 per cent. this bill is being footed by tobacco manuafcturers, and the pocket of the consumer is being saved to this extent.
    The Chancellor of the Exchequer has imposed an additional tax of some 8d. per pound, bringing the total duty on tobacco up to 8s. 10d. Now we see at a glance that this works out at about 6½d. per ounce of duty, and this has got to be paid long before the tobacco can be brought into the factories in order to be manufactured. I wonder if the Committee realises how much this duty amounts to in the case of the popular brands of cigarettes sold at 10 for 6d. I think it might interest them if I told them. For example, on the popular brands of cigarettes sold at 10 for 6d., the amount of duty is very nearly 3d. per packet, and in the case of the cigarettes sold at 10 for 4d. the duty amounts to approximately 2d. per packet. The Chancellor of the Exchequer, when dealing with the question of the Tobacco Duty, made two predictions. With the first I agree, but with the second I strongly disagree. The first prediction was this. He said:
    "I may add that I have no reason to believe that the whole increase of this tax will be passed on to the consumer."—[OFFICIAL REPORT, 11th April, 1927; col. 93, Vol. 205.]
    The right hon. Gentleman's hopes have been fully realised, and our large manufacturers of cigarettes, generally speaking, have made no alteration whatever in the price or size or quality of their cigarettes, and they have stated so frankly and boldly in the Press. The cigarette trade of this country is approximately
    336
    75 per cent. of the total tobacco trade, and I estimate that this piece of generosity or, shall I say, patriotism, on the part of the tobacco manufacturers is undoubtedly going to cost the tobacco trade some millions of pounds per annum.
    The second prediction which the Chancellor of the Exchequer made was this, that this increase of 8d. per lb. on raw tobacco would bring him in an additional income of £3,400,000 per annum. I disagree with that entirely, and I think that this additional tax will produce in a full year in the neighbourhood of £4,400,000 per annum, that is, if there is no reduction made in the consumption. I do not think the Chancellor of the Exchequer can anticipate a reduction in the consumption. I cannot conceive that any Chancellor of the Exchequer would impose an additional duty with a view to stifling consumption. Unfortunately, it has been necessary to increase the cost of pipe tobacco, for reasons which are very obvious and into which I will not go. It is extremely hard lines on the pipe smoker and on the man who is, unfortunately, earning a very low rate of wage, but I think the tobacco manufacturers can be exonerated from all blame. They have shouldered this additional burden of taxation which the Chancellor is imposing to the extent of some 75 per cent., and they are leaving only some 25 per cent. to be borne by the public.
    With all due respect to the Chancellor of the Exchequer, on this occasion as far as tobacco is concerned, I do not think he has been guided by very expert or skilful advisers. A different decision on his part would have saved the pipe smoker from sharing the burden with the tobacco manufacturer. I am not a very old man, but I well remember the day when the rate of the Tobacco Duty was 3s. per lb., or 2¼d. per ounce, whereas to-day it is 8s. 10d. per lb., or approximately 6½d. per ounce. I think the Chancellor of the Exchequer ought to realize what has happened in the past, and that following over-taxation on whiskey and on expensive wines and expensive cigars, there is no doubt that the consumption of these articles has been greatly retarded. I think the right hon. Gentleman took a very bold line when he increased the Tobacco Duty. It could quite well have

    337
    been passed on by the tobacco manufacturers to the consumer, but on this occasion the tobacco manufacturers have seen him through. But I wish, with all due respect, to warn the Chancellor that tobacco is not like the widow's cruse of oil; it has its limits. For many years the Tobacco Duty has been the goose which has laid many a golden egg for the Treasury. In these days, we hear much about the intensive system of egg production, but I hope that in the future the Chancellor of the Exchequer will not overstrain the vitality of that goose, and I warn him that the most prolific goose we know in the tobacco world, namely, the Gold Flake goose, may even succumb to the great strain which he is placing on her reproductive powers.
    I would like now to deal with one or two statements which have been made by hon. Members, which, I think, are somewhat inaccurate. The hon. Member for Springburn (Mr. Hardie), speaking on 27th April, said:
    "I was talking to my tobacconist this morning, and he told me that they were reducing not only the length but the circumference of the cigarettes, and were adding more moisture. He told me that there had been a big addition of moisture to cigarettes."—[OFFICIAL REPORT, 27th April, 1927; col. 905, Vol. 205.]
    That statement is absolutely absurd. Many days prior to that date practically all the large tobacco manufacturers had broadcast through the Press that there would be absolutely no alteration in the quality, size, or price of any of their cigarettes. As far as cigarettes are concerned, the character of their manufacture absolutely prohibits the possibility of adding increased moisture consistent with good smoking qualities. I would have thought it was perfectly obvious to most hon. Members that if you were to add excessive moisture to cigarettes, the delicate paper of which they are manufactured would be badly stained and the paste would not adhere. The hon. Member for Springburn asked the Chancellor of the Exchequer why he did not fix a percentage of moisture in sales. I can assure the Committee that for generations past there has always been a limit set for the moisture at which tobacco may be sold, and any party exceeding that moisture limit is heavily fined. I can assure the Committee that the Excise officers are very vigilant in looking after
    338
    the interests of the Treasury most carefully in this respect. I wish to refer to a matter which has already been raised by the hon. Member for Smethwick (Mr. Mosley) in regard to a statement which was made by my right hon. Friend the Financial Secretary to the Treasury. The right hon. Gentleman made the following statement:
    "He (Mr. Mosley) spoke about moisture in certain proportions being added. As far as I understand, there was never any addition of moisture, though I will not say it is never done; but the main thing is that the tobacco leaf has natural moisture in it. Hon. Members do not seem to be aware of that fact."—[OFFICIAL REPORT, 27th April, 1927; cols. 910–911, Vol. 205.]
    With all due respect to my right hon. Friend, I think that is a somewhat misleading statement. I know quite well that it is purely an error, but I wish to refer to it, because moisture is always added to tobacco in the process of manufacture. It always has been, and it always will be. Tobacco, generally speaking, imported into this country contains moisture of between 10·5 to 11 per cent. If you attempted to manufacture tobacco in that state, it would simply crumble up into atoms. Even if it were possible to manufacture it, the tobacco would not smoke; it would simply burn out in no time. As far as I can see, there are very few Members of this House who seem to have much knowledge in regard to moisture. They do not seem to realise that practically every material contains moisture, and that material which one would consider absolutely bone dry contains a considerable amount of moisture. Take, for example, the massive oak box on the Treasury Bench. It would surprise hon. Members to know that that box, made of well-seasoned wood, probably contains moisture to the extent of 8 per cent. The right hon. Member for Colne Valley (Mr. Snowden), the late Chancellor of the Exchequer, on the 27th April, said:
    "I shall show in a moment that it is not correct or true that the great bulk of this increased duty on tobacco is not being passed on to the consumer."—[OFFICIAL REPORT, 27th April, 1927; col. 861, Vol. 205.]
    The right hon. Gentleman was Chancellor of the-Exchequer for nine or ten months and he, obviously, has a knowledge of the various sources of taxation. He ought to know that the cigarette trade of this country is in the neighbourhood of 75 per cent. of the total tobacco trade. Days

    339
    before he made that statement he must have seen in the newspapers a statement broadcast by practically all the tobacco manufacturers that there was to be no alteration in the size, quality or price of their cigarettes. There may be some isolated cases, perhaps in some of the more expensive lines, or there may be an isolated case of a small tobacco manufacturer making a slight alteration, but I can assure the Committee that that is only a bagatelle, and may be discounted. The right hon. Gentleman produced in this House two cigarettes presumably of the same brand, one which we presume was manufactured before the Budget and one after, and he stated that the cigarette manufactured after the Budget was about one-eighth of an inch shorter than the one manufactured before the Budget. After the clear and frank statement which was made in the Press by important and leading tobacco manufacturers in this country it was a little unjust on the part of the right hon. Gentleman not to state in this House what brand of cigarette it was or the firm that manufactured it. My further comment is, that if an alteration has been made in any popular brand of cigarettes such as the right hon. Gentleman suggests, then its doom is sealed. But it may have been a cigarette of one of the more expensive brands which is generally smoked by the class of people known to the right hon. Gentleman as the idle rich.
    I wish further to refer to a statement made by the hon. Member for Camlachie (Mr. Stephen). I am sorry that he is not in his place. He said, with regard to the Chancellor of the Exchequer:
    "He tries to tell us that this tax is not going to the consumer. He knows it is going to the consumer, and the probability is that not only will there be a large tax on the consumer but the Imperial Tobacco Company will take advantage of the shortening of the cigarette just to take a little bit of commission on the tax."—[OFFICIAL REPORT, 27th April, 1927; col. 884, Vol. 205.]
    I can assure the Committee and the hon. Gentleman, if he will read the OFFICIAL REPORT to-morrow, that not only have the Imperial Tobacco Company not increased the price but that they have not shortened the cigarette. In this ease, and possibly in many other cases, the hon. Member for Camlachie has proved himself to be a false prophet. During the Debate we have heard a good many complaints that
    340
    the rich man's smoke has not had additional duty passed on to it; that it has not been passed on to the consumer of the Havanna cigar. I would remind the Committee that the increased duty on tobacco amounts to 8d. per pound, while the increased duty on Havana cigars has been made to the extent of 1s. 3d. a pound. Whether or not it has been passed on to the consumer I cannot say. Another complaint has been made that a good deal of money has been made by tobacco manufacturers clearing tobacco out of bond prior to the Budget. That is not the case. The Chancellor of the Exchequer is much too wise to allow that, and the Customs authorities rationed the amount of tobacco which could be drawn out of bond for many weeks prior to the Budget. Another complaint is that the price of cigarettes is at the same figure as in War time. I would remind the Committee that the duty at the present time is 8d. higher than in War time and that, nevertheless, the prices of the popular brands of cigarettes remain the same and the same size.
    I should like to congratulate the Chancellor of the Exchequer on continuing and increasing the preferential rate given to tobacco grown in the Empire. Tobacco grown within the Empire and manufactured in this country for the year ending October amounted to the very large quantity of approximately 18,000,000 pounds, an increase on last year of about 5,000,000 pounds. That is approximately one-seventh of the total amount of tobacco consumed in this country in any one year. That means that at the present time we are purchasing 18,000,000 pounds weight of tobacco from the Empire which would otherwise be purchased from foreign countries. I would have preferred had the Chancellor of the Exchequer left the duty where it was, and I have no doubt that the pipe smoker would have preferred that but the Chancellor of the Exchequer has a difficult job. He has to make arrangements to pay for the general strike and he has to make arrangements to pay for the strike in the coal industry. But in order to meet abnormal conditions, this Clause is going to have my full support. One thing to which I would like to refer is the statement made by the hon. Member for Smethwick (Mr. Mosley) who said that tobacco manufacturers were making abnormal profits over the moisture. I

    341
    grant you, and I said it in the House, that there is a certain amount of moisture added to tobacco, which is bound to increase its weight. The hon. Member must remember this—when you manufacture a pound of tobacco you do not sell 16 ounces. You have to take the stem out of the tobacco which is approximately 18 per cent. You have a certain amount of natural dust and sand in the tobacco, and when you sell it you have a certain amount of the "turn of the scale." So that you cannot sell 16 ounces out of one pound of tobacco. I grant that if you take out the stem, sand and dust, you get a rebate for that, but you make a loss. I am sorry I have detained the House so long.
    Mr. McNEILL: I confess I have some doubt as to whether I ought to attempt to reply to the Amendment that is on the Order Paper, and which has been formally moved, or to say anything about either of the speeches which have been delivered—either that of my hon. Friend the Member for Lanark (Mr. S. Mitchell) or that of the hon. Member who moved the Amendment, neither of which had any relation to the Amendment. My best plan will be to do a little of both. First of all, may I point out the disadvantage that would occur if the Amendment itself were accepted—the Amendment to which the Mover did not refer at all? The increase of the duty which we hope to gain by this Clause is estimated at rather over £3,000,000 in the current year, but I think it must be clear that if, as the Amendment proposes, it were decided to make that only for one year, we should certainly not raise within a considerable margin the amount we estimated to receive—for this very obvious reason, that an expectation would be held out that possibly next year an alteration might be made that this additional duty would not be continued. The consequence would be that there would be, probably, a very large holding up of tobacco shortly before the end of the financial year. Considering that every 1,000,000 pounds weight would reduce this year's revenue by very nearly £500,000—£420,000—and the weekly clearances of unmanufactured tobacco amount, approximately, to 2,500,000 pounds, it would be quite possible that the postponement that would be encouraged
    342
    by this Amendment, if it were carried out, would amount to a very considerable sum.
    10.0 p. m.
    Further, I think it is quite clear that we cannot accept the Amendment, and I do not think the Committee should have any hesitation about rejecting it, seeing that the Mover has not thought it necessary to say a word in its favour. The reason the hon. Member could not find time to say anything about his own Amendment was that he was enjoying himself so much over pointing out what he believed to be a mistake that had been made by me on a former occasion. That evidently caused him a great deal of enjoyment. He pointed out that a great authority on these subjects wrote a letter to the "Times" saying that an observation of mine in the Debate on the Budget Resolution was a mistake. If I recollect rightly, the observation I made, to which he dissented, was that I said moisture had to be extracted from tobacco, not added to it. Well, my hon. Friend the Member for Lanark has also pointed out that this is an error. But I regret to say I am not young enough to be ashamed of making a mistake. I wish I were. It is only the youngest of us who are infallible, and I can very well comfort myself with a very familiar story about a gentleman I might introduce to his notice called Dr. Johnson. He, on one occasion, was asked by somebody how he came to have made such a mistaken statement, and he replied, "Sheer ignorance, Madam, sheer ignorance." I do not want to diminish in the smallest, degree the satisfaction of the hon. Gentleman with which he has convicted me of being sheerly ignorant on the question of the manufacture of tobacco. It was quite apparent I was, and I stand here in a white sheet. I now confess that moisture is added to tobacco and not taken from tobacco, and I hope the hon. Gentleman will feel he has had a real, comfortable parliamentary triumph this evening.
    But my satisfaction does not quite end there. The hon. Member took his cue from the gentleman who wrote to the "Times"—a gentleman who said, it is perfectly true, that it was a pity that the Financial Secretary was so ignorant. I quite agree. Then this gentleman went on, and the hon. Member endorsed it, by saying I could not do better than gain some information about the process of the

    343
    manufacture of tobacco by reading the eleventh edition of the Encyclopædia Britannica. That gives me great satisfaction, because several years have passed since I was one of the editors of that book. I am bound to admit that although I took part in editing that great work of reference, I cannot pretend in any way to have assimilated the whole of the knowledge contained in that work. But I am delighted to find that, although many years have passed, the book is still of such commanding authority that it is quoted in Parliament by the hon. Member. The only other observation with which the hon. Member has honoured me was a reference to what he called my inconsistency with regard to the passing of the duty to the consumer. As a matter of fact, on this occasion I was perfectly correct. The proposition is a simple one—and I notice a reference to this also in a letter to the "Times" by another gentleman—that the natural incidence of indirect taxation is that it is passed on to the consumer.
    I said, perfectly consistently, when discussing this Budget Resolution, that, so far as our anticipations went, so far as tobacco was concerned, or, at any rate, the larger part of it in its most popular form, it would not in consequence of the duty be passed on to the consumer. Both these things have actually happened. As my hon. Friend the Member for Lanark, with his great authority on these matters, has said, up to this time, in the price, quality and size of the cigarettes, which account for some 70 per cent or more of the total amount of tobacco smoked, there has been no alteration. On the other hand, it is quite true that there has been a small addition in the price of pipe tobacco. But it remains true, as I said that the popularly-smoked tobacco has not been affected by the duty. The hon. Member made an elaborate calculation which, to his own satisfaction, proved that very large sums were being made, in consequence of the duty, as additional profit by the manufacturers, his argument being based upon the assumption that 16 ounces of unmanufactured tobacco would, by the addition of moisture, produce 19 ounces of finished tobacco.
    I do not think there is anything inaccurate in his calculation if his data were correct; but if his calculation,
    344
    which he worked out as showing an extra profit of £637,000 a year, were correct, the manufacturers would be selling in the year about 128,000,000 lb. of tobacco at an increased price of 1½d. an ounce, and containing 15 per cent. of added water. But that state of things does not occur. The total consumption of tobacco is, approximately, 140,000,000 lbs. a year, and it is estimated that about 70 per cent, of this consists of cigarettes which, if my information be correct, on the average do not contain even as much as 5 per cent. of added moisture over the natural moisture of the raw leaf. Of the remainder of the tobacco consumed, some 40,000,000 lbs., it is only some of the inferior varieties which contain as much added water as the 15 per cent. which the hon. Member made the basis of his calculations. It is, therefore, perfectly clear that nothing approaching 128,000,000 lbs. of tobacco is sold which contains 15 per cent, of added moisture. The quantity is much smaller Consequently, the figure of £637,000 a year of added profit has little or no relation to the facts. I do not know if it is necessary for me to follow my hon. Friend in his very interesting and very authoritative exposition of the tobacco position. I do not know whether I shall be called upon to discuss it at any future stage. We have had a very exhaustive examination of the whole position on this Amendment, the actual purpose of which is merely to make this an annual tax. At the present time, I must merely content myself with pointing out that we cannot possibly accept the Amendment as it stands, and that the strictures which have been passed upon my own conduct and observations in the past, although correct up to a certain point, really have nothing to do with the business before the House.
    Mr. HARRIS: We have just heard a very interesting confession from the right hon. Gentleman, and I congratulate him upon it. May I say that I would like to congratulate the hon. Member for Lanark (Mr. S. Mitchell) on his very excellent and informative speech. Most of the facts which he stated to the Committee are those which he has of his own knowledge and they can be accepted. It is quite clear that, in the case of the cheap cigarettes, the extra duty has not been passed on. The

    345
    hon. Member, with a certain amount of justification, claimed credit for various tobacco manufacturers for their patriotic action. But I think we want to dig a little deeper. I am afraid that we cannot quite give all this credit to the unselfishness of the great tobacco trade. It is common knowledge, and I have taken the trouble to confirm these statements, that there has been a tobacco war. The big combine, or trust, bought up most of the big tobacco factories and are waging war on one or two of the other firms. Some tobacco firms announced in the newspapers that they were to bear the whole of the burden and not pass it on to the public, and the big combine was forced to follow suit. I am not certain that it was all altruism. I am informed and I think my information is correct, that there is a great desire on the part of the combine to take advantage of this opportunity to drive out of existence some of the small manufacturers who have been striving in the last few years to keep their heads above water. While some of the big combines are making big profits, some of these factories have a hard struggle. I am not sure, if this tax is kept on, that, when some of these people have been knocked out, in duo course this tax will be passed on to the public either by increased price or short weight. But it was not of cigarettes that I wanted to speak. It is very unfortunate that the chief burden of this tax has to be borne, as usual, by the people who are least able to bear it. In every case, these new taxes have been born by the poorest people in the community, the men with the lowest wages, the agricultural labourers, the men with large families, the men who smoke the cheap tobacco.
    I find in my own constituency, and I think it will be the usual in the East End of London, that a popular tobacco is one which is known as British Oak. It is manufactured by one of the component parts of the Tobacco Trust, Lambert and Butler, and it used to be sold at 4¼d. a packet. It still can be bought at some places at 4¾d., which means that the 8d. per lb. increase is passed on to the consumer. I have the label. I should like the right hon. Gentleman to see it. It is an interesting exhibit. We are getting accustomed to making exhibits. We are constantly having articles taxed,
    346
    and we have to produce evidence in illustration of our arguments. In most cases what has happened is that the old price of 4¼d. a packet has been retained. The "ounce" has been marked out in ink and above the "4¼d. an ounce" have been put the words "1/34th of a lb." In other words, the quantity has been reduced; the price has been retained, and short weight has been given. There is no deception. It is quite plain what is being done, though the ordinary working man does not notice the "1/34th of a lb." That means that instead of the consumer paying8d. a pound he is actually paying 9d. a pound. The Committee ought to realise that that sort of thing is going on. It would be a great pity to think that the ordinary working man who buys cheap tobacco is not feeling the burden of the duty. To think that would be misleading both the tobacco consumer and the Committee.
    I wanted, for a moment, to support what the hon. Member for Smethwick (Mr. Mosley) said about the amount of moisture in tobacco. I have taken the trouble to inquire into the subject, and I find that what is really happening is that, as the Financial Secretary pointed out, 10 per cent. of moisture is allowed by the Customs on the importation of tobacco. I am informed that in the case of the higher qualities it is impossible to add much moisture because the tobacco would go mouldy, but the cheap tobacco, the very tobacco in this package, the homely shag of the ordinary working man, will stand moisture without deterioration, and in almost every case something like 22 per cent. of moisture is added. So in the cheap tobaccos not only is the consumer paying, but it is true to say, as the hon. Member said, that the big tobacco manufacturers are not only making their ordinary profit but are making some extra profit on the duty, in the fact that the moisture is added and the price remains the same. For that reason, I think it is very unfortunate that, as in the case of all the new taxes, the brunt of the burden is being borne, not by the well-to-do, but by the poorest of the community.
    Mr. GROTRIAN: I should like to suggest to the Chancellor of the Exchequer how he can get more revenue by decreasing the duty. I, of course,

    347
    refer to Havana cigars. In 1899, when the duty was 5s. a lb., the revenue obtained was £604,000. In 1916, when the duty had gone up to 10s. 9d. a lb., the amount of revenue obtained had fallen to £453,000. In 1921, when the duty had been again raised to 15s. 7d. a lb., the revenue had fallen still further to £322,700. Those figures show conclusively that of revenue goes down. The reason is obvious. When the rate of duty was not more than 10s. 6d. a lb. the bulk of the Havana cigars sold in this country were retailed at 6d. a piece. Now when you have a duty of 15s. 7d., the duty on each cigar amounts to 2·4d. which, of course, renders it quite impossible to sell it at 6d. It is a curious thing that you do

    Division No. 223.]

    AYES.

    [10.23 p.m.

    Adamson, W. M. (Staft., Cannock)

    Hall, G. H. (Merthyr Tydvil)

    Ritson, J,

    Alexander, A. V. (Sheffield, Hillsbro')

    Hamilton, Sir R. (Orkney & Shetland)

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Ammon, Charles George

    Harris, Percy A.

    Robinson, W. C. (Yorks, W. R., Elland)

    Baker, J. (Wolverhamton, Bilston)

    Hayday, Arthur

    Rose, Frank H.

    Baker, Walter

    Hayes, John Henry

    Salter, Dr. Alfred

    Barker, G. (Monmouth, Abertillery)

    Henderson, Rt. Hon. A. (Burnley)

    Scurr, John

    Barnes, A.

    Henderson, T. (Glasgow)

    Shepherd, Arthur Lewis

    Batey, Joseph

    Hirst, G. H.

    Shiels, Dr. Drummond

    Bondfield, Margaret

    Hirst, W. (Bradford, South)

    Short, Alfred (Wednesbury)

    Bowerman, Rt. Hon. Charles W.

    Hore-Belisha, Leslie

    Sitch, Charles H.

    Briant, Frank

    Hudson, J. H Huddersfield

    Smillie, Robert

    Broad, F. A.

    Hutchison, Sir Robert (Montrose)

    Smith, Ben (Bermondsey, Rotherhithe)

    Brown, Ernest (Leith)

    Jenkins, W. (Glamorgan, Neath)

    Smith, H. B. Lees (Keighley)

    Brown, James (Ayr and Bute)

    John, William (Rhondda, West)

    Snell, Harry

    Buchanan, G.

    Johnston, Thomas (Dundee)

    Snowden, Rt. Hon. Philip

    Buxton, Rt. Hon. Noel

    Jones, Henry Haydn (Merloneth)

    Spoor, Rt. Hon. Benjamin Charles

    Charleton, H. C.

    Jones, J. J. (West Ham, Silvertown)

    Stamford, T. W.

    Clowes, S.

    Jones, Morgan (Caerphilly)

    Stephen, Campbell

    Cluse, W. S.

    Jones, T. I. Mardy (Pontypridd)

    Stewart, J. (St. Rollox)

    Clynes, Rt. Hon. John R.

    Kelly, W. T.

    Strauss, E. A.

    Connolly, M.

    Kennedy, T.

    Sullivan, Joseph

    Cowan, D. M. (Scottish Universities)

    Kirkwood, D.

    Thorne, W. (West Ham, Plaistow)

    Crawfurd, H. E.

    Lansbury, George

    Thurtle, Ernest

    Davies, Rhys John (Westhoughton)

    Lawrence, Susan

    Townend, A. E.

    Day, Colonel Harry

    Lawson, John James

    Varley, Frank B.

    Dennison, R.

    Lee, F.

    Viant, S. P.

    Duckworth, John

    Lindley, F. W.

    Watson. W. M. (Dunfermline)

    Dunnico, H.

    Lowth, T.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Edwards, J. Hugh (Accrington)

    Lunn, William

    Webb, Rt. Hon. Sidney

    England, Colonel A.

    Mackinder, W.

    Wellock, Wilfred

    Fenby, T. D.

    MacLaren, Andrew

    Welsh, J. C.

    Forrest W.

    Maclean, Nell (Glasgow, Govan)

    Wiggins, William Martin

    Gardner, J. P.

    March, S.

    Wilkinson, Ellen C.

    Garro-Jones, Captain G. M.

    Morris, H. H.

    Williams, C. P. (Denbigh, Wrexham)

    Gibbins Joseph

    Morrison, R. C. (Tottenham, N.)

    Williams, David (Swansea, E.)

    Gillett George M.

    Mosley, Oswald

    Williams, Dr. J. H. (Lianelly)

    Gosling Harry

    Murnin, H.

    Wilson, C. H. (Sheffield, Attercilffe)

    Graham, D. M (Lanark, Hamilton)

    Naylor, T. E.

    Wilson, R. J. (Jarrow)

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Palin, John Henry

    Windsor, Walter

    Greenwood, A. (Nelson and Colne)

    Pethick-Lawrence, F. W.

    Young, Robert (Lancaster, Newton)

    Grentell, D. R. (Glamorgan)

    Ponsonby, Arthur

    Groves, T.

    Potts, John S.

    TELLERS FOR THE AYES.—

    Grundy, T. W.

    Rees, Sir Beddoe

    Mr. Charles Edwards and Mr.

    Hall, F. (York, W. R., Normanton)

    Riley, Ben

    Whiteley.

    NOES.

    Acland-Troyte, Lieut.-Colonel

    Applin, Colonel R. V. K.

    Baldwin, Rt. Hon. Stanley

    Agg-Gardner, Rt. Hon. Sir James T.

    Apsley, Lord

    Balfour, George (Hampstead)

    Albery, Irving James

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Balniel, Lord

    Alexander, E. E. (Leyton)

    Astbury, Lieut.-Commander F. W.

    Barnett, Major Sir Richard

    Alexander Sir Wm. (Glasgow, Cent'l)

    Atholl, Duchess of

    Barnston, Major Sir Harry

    Amery, Rt. Hon. Leopold C. M. S.

    Atkinson, C.

    Beamish, Rear-Admiral T. P. H.

    not get an increase in the British-made cigar as you drive the Havana cigar out of the market, because, for some reason or other, they seem to rise and fall together. When one goes down, the other goes down. I do not know why that is, but the figures show that it is so. Instead of endeavouring to get more revenue by trying to drive people on to pipe smoking—in spite of certain show eminent examples of that virtue or habit—I think we ought to try and get more revenue out of the poor Havana cigar smoker, and the only way to make him disgorge more revenue is by putting down the rate of duty.
    Question put, "That those words be there inserted."
    The Committee divided: Ayes, 128; Noes, 264.

    Benn, Sir A. S. (Plymouth, Drake)

    Grotrian, H. Brent

    O'Neill, Major Rt. Hon. Hugh

    Bennett, A. J.

    Guinness, Rt. Hon. Waiter E.

    Oman, Sir Charles William C.

    Beery, Sir George

    Gunston, Captain D. W.

    Ormsby-Gore, Rt. Hon. William

    Betterton, Henry B.

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Pennefather, Sir John

    Birchall, Major J. Dearman

    Hammersley, S. S.

    Percy, Lord Eustace (Hastings)

    Boothby, R. J. G.

    Hanbury, C.

    Perkins, Colonel E. K.

    Bourne, Captain Robert Croft

    Harland, A.

    Perring, Sir William George

    Bowyer, Captain G. E. W.

    Harrison, G. J. C.

    Plicher, G.

    Braithwaite, Major A. N.

    Hartington, Marquess of

    Pownall, Sir Assheton

    Brass, Captain W.

    Harvey, Major S. E. (Devon, Totnes)

    Preston, William

    Briscoe, Richard George

    Haslam, Henry C.

    Price, Major C. W. M.

    Brocklebank, C. E. R.

    Hawke, John Anthony

    Raciford, E. A.

    Brooke, Brigadler-Gneral C. R. I.

    Headlam, Lieut.-Colonel C. M.

    Raine, Sir Walter

    Broun-Lindsay, Major H.

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    Rawson, Sir Cooper

    Brown, Brig.-Gen. H. C. (Berks, Newb'y)

    Heneage, Lieut.-Colonel Arthur P.

    Reid. D. D. (County Down)

    Buchan, John

    Henn, Sir Sydney H.

    Remer, J. R.

    Buckingham, Sir H.

    Hennessy, Major Sir G. R. J.

    Rentoul, G. S.

    Bull, Rt. Hon. Sir William James

    Herbert, Dennis (Hertford, Watford)

    Rhys, Hon. C. A. U.

    Bullock, Captain M.

    Hills. Major John Waller

    Rice, Sir Frederick

    Burman, J. B.

    Hilton, Cecil

    Richardson, Sir P. W. (Sur'y, Ch'ts'y)

    Burton, Colonel H. W.

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Roberts, Sir Samuel (Hereford)

    Butler, Sir Geoffrey

    Hogg, Rt. Hon Sir D. (St. Marylebone)

    Robinson, Sir T. (Lanes, Stretford)

    Butt, Sir Alfred

    Holt, Captain H. P.

    Ropner, Major L.

    Cadogan, Major Hon. Edward

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Russell, Alexander West (Tynemouth)

    Campbell, E. T.

    Hope, Sir Harry (Forfar)

    Rye, F. G.

    Cassels, J. D.

    Hopkins, J. W. W.

    Salmon, Major I.

    Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)

    Howard-Bury, Lieut.-Colonel C. K.

    Samuel, Samuel (W'dsworth, Putney)

    Chadwick, Sir Robert Burton

    Hudson, Capt. A. U. M (Hlckney. N).

    Sandeman, N. Stewart

    Chapman, Sir S.

    Hudson, R. S. (Cumberl'and, Whlteh'n)

    Sanders, Sir Robert A.

    Charteris, Brigadier-General J.

    Hume, Sir G. H.

    Sassoon, Sir Philip Albert Gustave D.

    Chilcott, Sir Warden

    Hunter-Weston, Lt.-Gen. Sir Aylmer

    Savery, S. S.

    Christie, J. A.

    Huntingfield, Lord

    Shaw. R. G. (Yorks, W. R., Sowerby)

    Churchill, Rt. Hon. Winston Spencer

    Inskip, Sir Thomas Walker H.

    Sheffield, Sir Berkeley

    Churchman, Sir Arthur C.

    Jackson, Sir H. (Wandtworth, Cen'l)

    Shepperson, E. W.

    Clarry, Reginald George

    Jacob, A. E.

    Simms, Dr. John M. (Co. Down)

    Clayton, G. C.

    James, Lieut.-Colonel Hon. Cuthbert

    Sinclair, Col. T. (Queen's Univ., Belf'st.)

    Cobb, Sir Cyril

    Jephcott, A. R.

    Slaney, Major P. Kenyon

    Colfox, Major Wm. Phillips

    Jones. G. W. H. (Stoke Newington)

    Smith, R. W. (Aberd'n & Kinc'dine, C.)

    Conway, Sir W. Martin

    Kidd. J. (Linlithgow)

    Smith-Carington, Neville W.

    Cooper, A. Duff

    King, Commodore Henry Douglas

    Somerville, A. A. (Windsor)

    Cope, Major William

    Kinloch-Cooke, Sir Clement

    Spender-Clay, Colonel H.

    Couper, J. B.

    Knox, Sir Alfred

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Courthope, Colonel Sir G. L.

    Lamb, J. Q.

    Steel, Major Samuel Strang

    Croft, Brigadier-General Sir H.

    Lane Fox, Col. Rt. Hon. George R.

    Starry-Deans, R.

    Crooke, J. Smedley (Derltend)

    Leigh, Sir John (Clapham)

    Streatfeild, Captain S. R.

    Crookshank,Cpt. H. (Lindsey, Gainsbro)

    Lister, Cunliffe, Rt. Hon. Sir Philip

    Stuart, Hon. J. (Moray and Nairn)

    Cunliffe, Sir Herbert

    Little, Dr. E. Graham

    Sueter, Rear-Admiral Murray Fraser

    Dalkeith, Earl of

    Locker-Lampson, G. (Wood Green)

    Sugden, Sir Wilfrid

    Davidson, Major-General Sir John H.

    Long, Major Eric

    Sykes, Major-Gen. Sir Frederick H.

    Davies, Maj. Geo. F. (Somerset, Yeovll)

    Looker, Herbert William

    Thompson, Luke (Sunderland)

    Davies, Dr. Vernon

    Lougher, Lewis

    Thomson, F. C. (Aberdeen, South)

    Dawson, Sir Philip

    Luce, Major-Gen. Sir Richard Harman

    Thomson, Ht. Hon. Sir W. Mitchell-

    Dean, Arthur Wellesley

    Lumley, L. R.

    Tinne, J. A.

    Dixon, Captain Rt. Hon. Herbert

    Lynn, Sir R. J.

    Titchfield, Major the Marquess of

    Drewe, C.

    Macdonald, Capt. P. D. (I. of W.)

    Tryon, Rt. Hon. George Clement

    Eden, Captain Anthony

    Macdonald, R. (Glasgow, Cathcart)

    Vaughan-Morgan, Col. K. P.

    Edmondson, Major A. J.

    McDonnell, Colonel Hon. Angus

    Wallace, Captain D. E.

    Ellis, R. G.

    McLean, Major A.

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Elveden, Viscount

    Macmillan Captain H.

    Warner, Brigadier-General W. W.

    Evans, Captain A. (Cardiff, South)

    Macnaghten, Hon. Sir Malcolm

    Waterhouse, Captain Charles

    Everard, W. Lindsay

    McNeill, Rt. Hon. Ronald John

    Watson, Sir F. (Pudsey and Otley)

    Fairfax, Captain J. G.

    Making, Brigadier-General E.

    Watson, Rt. Hon. W. (Carlisle)

    Falle, Sir Bertram G.

    Malone, Major P. B.

    Wells, S. R.

    Fermoy, Lord

    Manningham-Buller, Sir Mervyn

    Wheler, Major Sir Granvllie C. H.

    Fielden, E. B.

    Margesson, Capt. D.

    Williams, A. M. (Cornwall, Northern)

    Finburgh, S.

    Marriott, Sir J. A. R.

    Williams, Com. C. (Devon, Torqusy)

    Ford, Sir P. J.

    Meller, R. J.

    Williams, Herbert G. (Reading)

    Forestier-Walker, Sir L.

    Meyer, Sir Frank

    Windsor-Clive, Lieut.-Colonel George

    Foxcroft, Captain C. T.

    Milne, J. S. Wardlaw-

    Winterton, Rt. Hon. Earl

    Fraser, Captain Ian

    Mitchell, S. (Lanark, Lanark)

    Wise, Sir Fredric

    Gadie, Lieut.-Col. Anthony

    Mitchell, W. Foot (Saffron Weldon)

    Wither, John James

    Ganzonl, Sir John

    Moosell, Eyres, Com. Rt. Hon. B. M.

    Womersley, W. J.

    Gates, Percy

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Wood, B. C. (Somerset, Bridgwater)

    Gault, Lieut.-Col. Andrew Hamilton

    Moore, Sir Newton J.

    Wood, E. (Chest'r, Stalyb'ge & Hyde)

    Gibbs. Col. Rt. Hon. George Abraham

    Morden, Colonel Walter Grant

    Wood, Sir Kingtley (Woolwich, W.).

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Moreing, Captain A. H.

    Worthington-Evans. Rt. Hon. Sir L.

    Glyn, Major R. G. C.

    Morrison-Bell, Sir Arthur Clive

    Yerburgh, Major Robert D. T.

    Gower, Sir Robert

    Murchison, Sir Kenneth

    Young, Rt. Hon. Sir Hilton (Norwich)

    Grace, John

    Nelson, Sir Frank

    Graham, Fergus (Cumberland, N.)

    Neville, Sir Reginald J.

    TELLERS FOR THE NOES.—

    Grattan-Doyle, Sir N.

    Newman, Sir Rt. H. S. D. L. (Exeter)

    Captain Viscount Curzon and Mr.

    Greaves-Lord, Sir Walter

    Newton, Sir D. G. C. (Cambridge)

    Penny.

    Greene, W. P. Crawford

    Nicholson, Col. Rt. Hn. W. G. (Ptrsl'ld.)

    Grenfell, Edward C. (City of London)

    O'Connor, T. J. (Bedford Luton)

    Motion Made, and Question put, "That the Clause stand part of the Bill."

    Division No. 224.]

    AYES.

    [10.32 p.m.

    Acland-Troyte, Lieut.-Colonel

    Elveden, Viscount

    Long, Major Eric

    Agg-Gardner, Rt. Hon. Sir James T.

    Evans, Captain A. (Cardiff, South)

    Looker, Herbert William

    Albery, Irving James

    Everard, W. Lindsay

    Lougher, Lewis

    Alexander, E. E. (Leyton)

    Fairfax, Captain J. G.

    Luce, Maj.-Gen. Sir Richard Harman

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Falle, Sir Bertram G.

    Lumley, L. R.

    Amery, Rt. Hon. Leopold C. M. S.

    Fermoy, Lord

    Lynn, Sir R. J.

    Applin, Colonel R. V. K.

    Fielden, E. B.

    Macdonald, Capt. P. D. (I. of W.)

    Apsley, Lord

    Finburgh, S.

    Macdonald, R. (Glasgow, Cathcart)

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Ford, Sir P. J.

    McDonnell, Colonel Hon. Angus

    Astbury, Lieut.-Commander F. W.

    Forestier-Walker, Sir L.

    McLean, Major A.

    Atholl, Duchess of

    Foxcroft, Captain C. T.

    Macmillan Captain H.

    Atkinson, C.

    Fraser, Captain Ian

    Macnaghten, Hon. Sir Malcolm

    Baldwin, Rt. Hon. Stanley

    Gadie, Lieut.-Col. Anthony

    McNeill, Rt. Hon. Ronald John

    Balfour, George (Hampstead)

    Ganzonl, Sir John

    Makins, Brigadier-General E.

    Balniel, Lord

    Gates, Percy

    Malone, Major P. B.

    Barnett, Major Sir Richard

    Gault, Lieut.-Col. Andrew Hamilton

    Manningham-Buller, Sir Mervyn

    Barnston, Major Sir Harry

    Gibbs, Col. Rt. Hon. George Abraham

    Margesson, Captain D.

    Beamish, Rear-Admiral T. P. H.

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Marriott, Sir J. A. R.

    Benn, Sir A. S. (Plymouth, Drake)

    Glyn, Major R. G. C.

    Meller, R. J.

    Bennett, A. J.

    Gower, Sir Robert

    Meyer, Sir Frank

    Betterton, Henry B.

    Grace, John

    Milne, J. S. Wardlaw-

    Birchall, Major J. Dearman

    Graham, Fergus (Cumberland, N.)

    Mitchell, S. (Lanark, Lanark)

    Boothby, R. J. G.

    Grattan-Doyle, Sir N.

    Mitchell, W. Foot (Saffron Walden)

    Bourne, Captain Robert Croft

    Greaves-Lord, Sir Walter

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Bowyer, Capt. G. E. W.

    Greene, W. P. Crawford

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Braithwaite, Major A. N.

    Grenfell, Edward C. (City of London)

    Moore, Sir Newton J.

    Brass, Captain W.

    Grotrian, H. Brent

    Morden, Colonel Walter Grant

    Briscoe, Richard George

    Guinness, Rt. Hon. Walter E.

    Moreing, Captain A. H.

    Brocklebank, C. E. R.

    Gunston, Captain D. W.

    Morrison-Bell, Sir Arthur Clive

    Brooke, Brigadier-General C. R. I.

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Murchison, Sir Kenneth

    Broun-Lindsay, Major H.

    Hammeraley, S. S.

    Nelson, Sir Frank

    Brown, Brig.-Gen. H. C. (Berks, Newb'y)

    Hanbury, C.

    Neville, Sir Reginald J.

    Buchan, John

    Harland, A.

    Newman, Sir R. H. S. D. L. (Exeter)

    Buckingham, Sir H.

    Harrison, G. J. C.

    Newton, Sir D. G. C. (Cambridge)

    Bull, Rt. Hon. Sir William James

    Hartington, Marquess of

    Nicholson. Col. Rt. Hn. W. G. (Ptrsf'ld.)

    Bullock, Captain M.

    Harvey, Major S. E. (Devon, Totnes)

    O'Connor, T. J. (Bedford, Luton)

    Burman, J. B.

    Haslam, Henry C.

    O'Neill, Major Rt. Hon. Hugh

    Burton, Colonel H. W.

    Hawke, John Anthony

    Oman, Sir Chsrles William C.

    Butler, Sir Geoffrey

    Headlam, Lieut.-Colonel C. M.

    Ormsby-Gore. Rt. Hon. William

    Butt, Sir Alfred

    Henderson, Capt. R. R. (Oxf'd, Henley)

    Pennefather, Sir John

    Cadogan, Major Hon. Edward

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    Percy, Lord Eustace (Hastings)

    Campbell, E. T.

    Heneage, Lieut.-Colonel Arthur P.

    Perkins, Colonel E. K.

    Cassels, J. D.

    Henn, Sir Sydney H.

    Perring, Sir William George

    Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)

    Hennessy, Major Sir G. R. J.

    Pilcher, G.

    Chadwick, Sir Robert Burton

    Herbert, Dennis (Hertford, Watford)

    Preston, William

    Chapman, Sir S.

    Hills, Major John Waller

    Price, Major C. W. M.

    Charteris, Brigadier-General J.

    Hilton, Cecil

    Radford E. A.

    Chilcott, Sir Warden

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Raine, Sir Walter

    Christie, J. A.

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Rawson, Sir Cooper

    Churchill, Rt. Hon. Winston Spencer

    Holt, Capt. H. P.

    Reid. D. D. (County Down)

    Churchman, Sir Arthur C.

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Remer, J. R.

    Clarry, Reginald George

    Hope, Sir Harry (Forfar)

    Rentoul, G. S.

    Clayton, G. C.

    Hopkins, J. W. W.

    Rhys, Hon C. A. U.

    Cobb, Sir Cyril

    Howard-Bury, Lieut.-Colonel C. K.

    Rice, Sir Frederick

    Cochrane, Commander Hon. A. D.

    Hudson, Capt. A. U. M. (Hackney, N.)

    Richardson, Sir P. W. (Sur'y, Ch'ts'y)

    Colfox, Major William Phillips

    Hudson, R. S. (Cumberl'nd, Wnlteh'n)

    Roberts, Sir Samuel (Hereford)

    Conway, Sir W. Martin

    Hume, Sir G. H.

    Robinson, Sir T (Lanes, Stretford)

    Cooper, A. Duff

    Hunter-Weston, Lt.-Gen. Sir Aylmer

    Ropner, Major L.

    Cope, Major William

    Huntingfield. Lord

    Russell, Alexander West (Tynemouth)

    Couper, J. B.

    Inskip, Sir Thomas Walker H.

    Rye. F. G.

    Courthope, Colonel Sir G. L.

    Jackson, Sir H. (Wandsworth, Cen'l)

    Salmon, Major I.

    Croft, Brigadier-General Sir H.

    Jacob, A. E.

    Samuel, Samuel (W'dsworth, Putney)

    Crooke, J. Smedley (Deritend)

    James, Lieut.-Colonel Hon. Cuthbert

    Sandeman, N. Stewart

    Crookshank, Cpt.H. (Lindsey, Gainsbro)

    Jephcott, A. R.

    Sanders Sir Robert A.

    Cunliffe, Sir Herbert

    Jones, G. W. H. (Stoke Newington)

    Sassoon, Sir Philip Albert Gustave D.

    Dalkeith, Earl of

    Kidd, J. (Linlithgow)

    Savery, S. S.

    Davidson, Major-General Sir J. H.

    Kindersley, Major G. M.

    Shaw, R. G. (Yorks, W. R., Sowerby)

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    King, Commodore Henry Douglas

    Sheffield, Sir Berkeley

    Davies, Dr. Vernon

    Kinloch-Cooke, Sir Clement

    Smith. R. W. (Aberd'n & Kinc'dine, C.)

    Dawson, Sir Philip

    Knox, Sir Alfred

    Shepperson, E. W.

    Dean, Arthur Wellesley

    Lamb, J. Q.

    Simms, Dr. John M. (Co. Down)

    Dixon, Captain Rt. Hon. Herbert

    Lane Fox, Col. Rt. Hon. George R.

    Sinclair, Col. T. (Queen's Univ., Belfst)

    Drewe, C.

    Leigh, Sir John (Clapham)

    Slaney, Major P. Kenyon

    Eden, Captain Anthony

    Lister, Cunlifte, Rt. Hon. Sir Philip

    Smith-Carington, Neville W.

    Edmondson, Major A. J.

    Little, Dr. E. Graham

    Somerville, A. A. (Windsor)

    Ellis, R. G.

    Locker-Lampson, G. (Wood Green)

    Spender-Clay, Colonel H.

    The Committee divided: Ayes, 265; Noes, 127.

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Vaughan-Morgan, Col. K. P.

    Wise, Sir Fredric

    Steel, Major Samuel Strang

    Wallace, Captain D. E.

    Withers, John James

    Starry-Deans, R.

    Ward. Lt.-Col. A. L. (Kingston-on-Hull)

    Womersley, W. J

    Streatfeild, Captain S. R.

    Warner, Brigadier-General W. W.

    Wood, B. C. (Somerset, Bridgwater)

    Stuart, Hon. J. (Moray and Nairn)

    Waterhouse, Captain Charles

    Wood, E. (Chest'r, Stalyb'dge & Hyds)

    Sueter Rear-Admiral Murray Fraser

    Watson, Sir F. (Pudsey and Otley)

    Wood, Sir Kingsley (Woolwich, W.)

    Sugden, Sir Wilfrid

    Watson, Rt. Hon. W. (Carlisle)

    Worthington-Evans, Rt. Hon. Sir L.

    Sykes, Major-Gen. Sir Frederick H.

    Wells, S. R

    Yerburgh, Major Robert D. T.

    Thompson, Luke (Sunderland)

    Wheler, Major Sir Granville C. H.

    Young, Rt. Hon. Sir Hilton (Norwich)

    Thomson, F. C. (Aberdeen, South)

    Williams, A. M. (Cornwall, Northern)

    Thomson, Rt. Hon. Sir W. Mitchell-

    Williams, Com. C. (Devon, Torquay)

    TELLERS FOR THE AYES—

    Tinne, J. A.

    Williams, Herbert G. (Beading)

    Captain Viscount Curzon and Mr.

    Titchfield, Major the Marquess of

    Windsor-Clive, Lieut.-Colonel George

    Penny.

    Tryon, Rt. Hon. George Clement

    Winterton, Rt. Hon. Earl

    NOES.

    Adamson, W. M. (Staff., Cannock)

    Hamilton, Sir R. (Orkney & Shetland)

    Roberts, Ht. Hon. F. O. (W. Bromwich)

    Alexander, A. V. (Sheffield, Hillsbro')

    Harris, Percy A.

    Robinson, W. C. (Yorks, W. R., Elland)

    Ammon, Charles George

    Hayday, Arthur

    Rose, Frank H.

    Baker, J. (Wolverhampton, Bilston)

    Hayes, John Henry

    Salter, Dr. Alfred

    Baker, Walter

    Henderson, Rt. Hon. A. (Burniey)

    Scurr, John

    Barker, G. (Monmouth, Abertillery)

    Henderson, T. (Glasgow)

    Shepherd, Arthur Lewis

    Barnes, A.

    Hirst, G. H.

    Shiels, Dr. Drummond

    Batey, Joseph

    Hirst, W. (Bradford, South)

    Short, Alfred (Wednesbury)

    Bondfield, Margaret

    Hore-Belisha, Leslie

    Sitch, Charles H.

    Bowerman, Rt. Hon. Charles W.

    Hudson, J. H. (Huddersfield)

    Smillie, Robert

    Briant, Frank

    Hutchison, Sir Robert (Montrose)

    Smith, Ben (Bermondsey, Rotherhithe)

    Broad, F. A.

    Jenkins, W. (Glamorgan, Neath)

    Smith, H. B. Lees (Keighley)

    Brown, Ernest (Leith)

    John, William (Rhondda, West)

    Snell, Harry

    Brown, James (Ayr and Bute)

    Johnston, Thomas (Dundee)

    Snowden, Rt. Hon. Philip

    Buchanan, G.

    Jones, Henry Haydn (Merioneth)

    Spoor, Rt. Hon. Benjamin Cnarles

    Buxton, Rt. Hon. Noel

    Jones, J. J. (West Ham, Silvertown)

    Stamford, T. W.

    Charleton, H. C.

    Jones, Morgan Caerphilly)

    Stephen, Campbell

    Clowes, S.

    Jones, T. I. Mardy (Pontypridd)

    Stewart J. (St. Rollox)

    Clynes, Rt. Hon. John R.

    Kelly, W. T.

    Strauss, E. A.

    Connolly, M.

    Kennedy, T.

    Sullivan, J.

    Cowan, D. M. (Scottish Universities)

    Kirkwood, D.

    Thorne, W. (West Ham, Plaistow)

    Crawfurd, H. E.

    Lansbury, George

    Thurtie, Ernest

    Davies, Rhys John (Westhoughton)

    Lawrence, Susan

    Townend, A. E.

    Day, Colonel Harry

    Lawson, John James

    Varley, Frank B.

    Dennison, R.

    Lee, F.

    Viant, S. P.

    Duckworth, John

    Lindley, F. W.

    Watson, W. M. (Dunfermllne)

    Dunnico, H.

    Lowth, T.

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Edwards, J. Hugh (Accrington)

    Lunn, William

    Webb, Rt. Hon. Sidney

    England, Colonel A.

    Mackinder, W.

    Wellock, Wilfred

    Fenby, T. D.

    MacLaren, Andrew

    Welsh, J. C.

    Forrest, W.

    Maclean, Nell (Glasgow, Govan)

    Wiggins, William Martin

    Gardner, J. P.

    March, S.

    Wilkinson, Ellen C.

    Garro-Jones, Captain G. M.

    Morris, R. H.

    Williams, C. P. (Denbigh, Wrexham)

    Gibbins, Joseph

    Morrison, R. C. (Tottenham, N.)

    Williams, David (Swansea, E.)

    Gillett, George M.

    Mosley, Oswald

    Williams, Dr. J. H. (Lianelly)

    Gosling, Harry

    Murnin, H.

    Wilson, C. H. (Sheffield, Attercliffe)

    Graham, D. M. (Lanark, Hampton)

    Naylor, T. E.

    Wilson, R. J. (Jarrow)

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Palin, John Henry

    Windsor, Walter

    Greenwood, A. (Nelson and Colne)

    Pethick-Lawrence, F. W.

    Young, Robert (Lancaster, Newton)

    Grenfell, D. R. (Glamorgan)

    Ponsonby, Arthur

    Groves, T.

    Potts, John S.

    TELLERS FOR THE NOES.—

    Grundy, T. R.

    Rees, Sir Beddoe

    Mr. Charles Edwards and Mr.

    Hall, F. (York, W. R., Normanton)

    Riley, Ben

    Whiteley.

    Hall, G. H. (Merthyr Tydvil)

    Ritson, J.

    CLAUSE 8.—(Increased duty on matches.)
    The CHAIRMAN: I think it will be convenient if we take a general discussion on the first Amendment as we did in the case of the last Clause.
    Mr. LEES-SMITH: I beg to move, in page 4, line 28, after the word "twenty-seven," to insert the words "until the twelfth day of April, nineteen hundred and twenty-eight."
    This is the Clause which imposes the extra duty upon matches, and we intend to oppose it in the same way and for much the same reasons as we have
    354
    opposed the Clause dealing with tobacco. The tax upon matches is fundamentally and in principle more objectionable and more unfair than the tax upon tobacco. As a matter of fact I do not think that there is any article of ordinary consumption the price of which has been so much raised since the War as the price of matches. Before the War the price of matches used to be six boxes for a penny, but the price to-day is one penny per box. Consequently the price has risen by 600 per cent., which is altogether out of proportion to the rise in the price of almost any other popular article in use.

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    My calculation is that this duty comes roughly to the equivalent of a duty of an extra half-penny upon a dozen boxes of matches and the question which is of special interest to us is to ask by whom is this duty eventually going to be paid? The match manufacturers have already practically told the public that it is not likely that it is going to be paid by them. Messrs. Bryant and May have announced that there is to be an increase of one half-penny per dozen in the price of their matches, an increase which is practically equivalent to the new duty which is being proposed. Who is going to pay the duty? I may say that this is an interesting example of the kind of argument that has been previously used this evening, and is always used whenever questions of Free Trade and Protection are debated. The price of the box of matches is now 1d. Although the duty has been imposed, it has remained at 1d., and I have no doubt that it will continue at 1d. But, nevertheless, this duty is going to be paid by the public, and for this reason. I was told by manufacturers of matches, even before this duty was proposed, that the cost of production of matches had been falling for some years, and that the time was just approaching when they were going to put upon the market matches at the price of two boxes for 1½d., so that we should have approached rather nearer to the prices at which matches were sold before the War. This duty means that that reduction in price will not take place, and, as a consequence, the price of matches will be stabilised at its present excessively high figure for an indefinite period.
    The increase in price will fall upon the public at large, and, unfortunately, this is another example of those duties in the case of which the public at large means mainly the poorer sections of the State. I remember that not long ago Messrs. Bryant and May, when they were wanting some other favour, sent out a letter, which I think must have gone to all the Members of the House, because I received an ordinary typewritten copy of it, and in that letter, in order to support another argument of theirs, they said that their calculation was that five-sixths of the matches used in this country were used by the working class. The fact is that, although the amount spent on
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    matches is not very large, the effect of a tax upon matches is practically the same as that of a tax upon tea. In the case of matches, as in the case of tea, the ordinary working-class household spends practically the same sum as a household of the weathier section of the community, and the result is that, if matches are taxed and their price is increased, it takes a far larger proportion out of the pockets of the poorer section than it takes from the wealthier sections of the State. For that reason, our general opposition to this tax is based on exactly the same grounds as our general opposition to all these taxes upon the necessities of life. The weight of it on rich and comfortable homes will be practically inappreciable, but it does mean that once again the Chancellor of the Exchequer is taking a few more pennies out, of the pockets of the less comfortable sections in the country, when they need to buy one of these common necessities of their homes.
    Major HILLS: The hon. Member for Keighley (Mr. Lees-Smith) complained that when matches were not taxed at all they were much cheaper. I quite agree that they were, and I there were no tax the price would come down. The hon. Member then went on to say that the increased tax would be borne entirely by the consumer. That is not entirely so. The increased tax is 1s. per standard gross of 10,000 matches. The standard gross is not a trails description at all, because matches are not sold by the standard gross; they are sold by the trade gross, that is to say, a gross of boxes containing 50 matches per box. That works out, not at 10,000 matches but at 7,200 matches. On a trade gross the extra tax imposed by this Budget is 7d., and of that the manufacturers are passing on 6d. to the wholesalers, the retailer and to the public. I cannot say exactly in what way that would be apportioned, but it certainly will not all fall upon the public for, in the first place, the increase that the manufacturers are making is only ½d. per dozen, and the competition in selling matches is very keen, and I do not anticipate that the whole amount will be passed on. The last speaker knows that the effect of the tax will indirectly effect a saving to the public, for it standardises the tax at 50 matches per box. Before this new tax was imposed foreign matches were coming in at 30, 35, 40 or 45 matches per box, and these boxes

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    looked just the same as boxes containing 50 matches, and were sold at the same price.
    Now take the housewife who goes to buy a dozen boxes of matches, for all prudent purchasers buy by the dozen. She might have got a dozen boxes with 50 matches in a box or a dozen with 35 matches in a box, and so she might have lost 12 times 15, which is 180 matches. Now the tax is charged on all boxes of matches that hold more than 20, as though they held 50, so that it will not pay foreign importers to put less than 50 in a box because that would mean paying a tax in excess of the value of their products. To that extent the public will be protected, and I think the House will realise it was a very serious fraud on the public that when they expected to get 50 matches all they got was 35. Further, the price the manufacturer charges of 6d. per gross is merely replacing the price at the same figure at which it stood in 1923, and from 1923 to 1925 at which time the price was reduced by 6d. a gross. I think that is the reduction which the hon. Member for Keighley has in mind. It did take place, and I quite agree that the effect of this tax is to take off that reduction, but, after all, it only replaces the position as it was two years ago. There is nothing protective to the manufacturer in this tax. I think the hon. Member will admit that the only people who are protected are the public, except that indirectly the British manufacturer is protected from unfair foreign competition, and I are quite certain the hon. Member will not object to that. Since a part of the tax will be shouldered, first by the manufacturer, next by the wholesaler, and next by the retailer, and further as the public will get the article they are paying for, and not a box containing 35 matches, I hope that the Committee will pass this Clause.
    11.0 p.m.
    Mr. E. BROWN: The Committee will have been interested in the second speech of the hon. and gallant Member for Ripon (Major Hills) on this tax, and I do not think they will grudge a little further consideration of the tax. Seeing that successive Governments from 1916 till to-day have received £13,000,000 of revenue from this small tax, and that up to this Budget only 63 lines of the OFFICIAL REPORT have been occupied by
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    discussion on this tax, there ought to be a great deal more discussion. When Mr. McKenna introduced it in 1916, he introduced it as a war-time tax. When Mr. Bonar Law altered it in 1918 he used a phrase curiously like that used by the present Chancellor of the Exchequer when introducing his Budget, and perhaps the Committee will allow me to read it. The Chancellor, when he was making his great ascent up the mountain of difficulty, said:
    "Proceeding upon our ascent, step by step and crag by crag, I now come to matches"—
    He wanted a little light on his journey—
    "It will probably be a surprise to many well-informed Members that we have been for many years raising revenue by a strictly orthodox Customs and Excise duty upon matches, the revenue of which last year amounted to no less than £3,500,000."
    This is the sentence which I would like the Committee particularly to note:
    "The British match industry has submitted to me a plan which combines an increase in the Match Duty with an alteration of its basis, which they assure me will be more satisfactory to them in relation to foreign competition than is the existing scheme."—[OFFICIAL REPORT, 11th April, 1927; col. 90, Vol. 205.]
    Then he goes on to outline the alterations contained in the White Paper and in the scheme which we are discussing to-night. I suggest that we are entitled to have from the Financial Secretary to the Treasury a little light upon the deputation that came from the industry to the Exchequer as to the composition of that deputation, as to the number of firms concerned in it, and as to what took place between the Exchequer and the deputation before this alteration was made. A very celebrated British philosopher once said:
    "Two men of the same trade rarely meet together in secret without planning a conspiracy against the public."
    A modern Yankee would say, "You scratch my back and I will scratch yours, and we will all rob the public." The hon. Member for Mossley (Mr. A. Hopkinson) will probably agree with him, for in a recent Debate he said that he feared the right hon. Member for Carmarthen (Sir A. Mond) not when he disagreed with Labour, but when he agreed with it, in making a combine against the public, and I am suspicious of the agreements, past

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    and present, between the Treasury and the match industry. I want to know what the match industry is getting out of this last agreement and who are the firms concerned in getting whatever they are getting out of it. The speech delivered by the hon. and gallant Member for Ripon to-night is not quite the same as that delivered by him on the Budget Resolutions. I have that speech here, and I notice that then he was by no means so sure of the incidence of this tax as he seems to be to-night. I would like to quote some words of John Stuart Mill against this tax. John Stuart Mill once said:
    "The direct tax is one which is demanded from the very persons whom it is intended or desired should pay, but the indirect tax is that which is demanded from one person in the expectation and intention that he or she shall indemnify himself or herself at the expense of another."
    I believe that to be sound doctrine, and I think the two speeches delivered in this House on this Match Tax by the hon. and gallant Member for Ripon only emphasise the soundness of that doctrine, for in his first speech he said he was quite sure who was going to pay the duty, and he mentioned the manufacturer, the wholesaler, the retailer, and, to a certain small extent, the public. I would ask the Financial Secretary to the Treasury if there are any calculations which have been made at the Treasury as to the incidence of this tax between the various people mentioned by the hon. Member for Ripon. Although we have been speaking in pounds and shillings, this is not a matter of pounds or shillings to the match industry, the Treasury or the British public. When this Duty was introduced in 1916 by Mr. McKenna, the total revenue was £1,029,000. In the following year it amounted to £1,242,000; in the third year, £2,027,000; in the fourth year, £3,336,000; in the fifth year, £3,051,000. In the sixth year there was a slight diminution, because the tax on mechanical lighters which had held good up to then was repealed. The amount in that year was £3,023,000. In the following year there was another slight diminution to £3,013,000. Since then, we have had continuous rises to £3,121,000, £3,295,000, £3,345,000, and now the Chancellor of the Exchequer wants an additional £500,000,
    £600,000 or £700,000. That means the
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    British consumer of matches, the housewife, all who use matches, smokers and all kinds of people, the whole public who buy matches for ordinary purposes, will pay more in proportion to the matches they buy than those who buy the more expensive matches.
    I suggest to the Financial Secretary that the Committee are entitled to some information as to the members of the deputation who saw the Treasury, the number of firms who are associated with each other in suggesting the second alteration—the first alteration of the duty came about on the suggestion of the manufacturers—and as to the Treasury view of the incidence of this additional duty upon the general public, as compared with the wholesaler, the retailer and the match manufacturer. This duty amounts to nearly £4,000,000, and the Committee are entitled to a good deal more information than they have yet received about the details of the Clause.
    Mr. MARCH: I was rather surprised, in listening to the hon. and gallant Member for Ripon (Major Hills), to note how he had wheeled round from what he said on the previous occasion.
    Major HILLS: I said exactly the same on the Resolution as I say now. I said that sixpence would be passed on by the manufacturer, but that of that sixpence I did not think the whole would be passed on to the public.
    Mr. MARCH: To-night, the hon. Member has been trying to make us believe that it is going to be shared between the manufacturer, the wholesaler, the retailer and the consumer. That is a little different from what he said before. I have yet to learn where the patriotism runs with the wholesaler and the retailer to take their share of the extra duty which is being imposed by the Government in this respect. I was very interested to learn that no prudent housewife would purchase her matches in dozen boxes. If the hon. Member for Ripon (Major Hills) would only come down to the district I have the honour to represent, he would find some of those widows and old ladies, and the old age pensioners buying one box at a time, and they cannot afford to buy more. The result is that the passing on of the extra charge will go on to the poorest people that there is in this country.
    Major HILLS: May I point out that the penny box is still a penny even if the tax is imposed.
    Mr. MARCH: May I fell the hon. and gallant Member that there are some boxes at a halfpenny?
    Major HILLS Major HILLS Not 50 matches.
    Sir FREDRIC WISE: Are they still a halfpenny?
    Major HILLS: There are not 50.
    Mr. MARCH: No, 20, and bad enough it is. It is very nice for hon. Members to come to the House and talk about all being so cheap and reasonable, for these people who have to use matches more than we do ourselves feel anything extra that is imposed on them. I myself ought not to complain, because I am a nonsmoker. I do not waste any matches in that direction. I am also able by living in Poplar to have the electric light put on. Therefore, I do not want any matches to light up when I go home early or late; and it is quite probable that that applies to a large number of Members on the other side of the House. We are doing our best to see that all the people get light in our district. I should like to say that this is another imposition of indirect, taxation upon the poorest people of the country. As the hon. Member for Keighley (Mr. Lees-Smith) has said, the agricultural labourer gets very poor wages, and up to the present time he has not, in many instances, even got gas. They still use the old tallow candle. [An HON. MEMBER:
    "They get Tory gas."] They get plenty of Tory gas it is true, and they are told things will get better by and by. It will only be when they get beyond the moon. They will not get anything on this earth. Those who have got beyond tallow candles have paraffin oil, and this is the only light they can get in many instances. They are the people this is going to affect very largely indeed, and I hope that the Financial Secretary to the Treasury will be able to explain to us what he has learned in connection with this matter for those benevolent match manufacturers who waited upon him as to what they intend to do with this extra duty which you are now imposing on them. Did you get anything from them that they were
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    anxious to pay it all themselves, or did you get anything from them that they were going to pass it on?
    The CHAIRMAN: Will the hon. Gentleman address me.
    Mr. MARCH: I thought, if I looked at him pleasantly, I would get a decent answer. I do not expect to get an answer from you, Sir. I should like to know whether anything of the kind with regard to the sharing out of this extra tax was mentioned, and whether there was any of them patriotic enough to say that they would bear the whole burden, because they are making a decent profit, and they are belauding themselves for the profits they are making out of matches at the present time.
    Sir H. CROFT: I want to intervene for a very few moments. I confess that the attitude of the Opposition and the opportunities they have missed this evening have depressed me. When the hon. Member for Keighley (Mr. Lees-Smith) rose to his feet, I thought that at last we were going to have a real statement on behalf of the workers of this country. But all he could say was that this was another burden on the poor, although I think he has since confessed that a box of matches has not been increased to the individual. We have just heard that, at any rate in Poplar, no one ever buys more than one box of matches—
    Mr. MARCH: I did not say that.
    Sir H. CROFT: I desire to take this opportunity of making the most full and ample apology to the hon. Member. I did think that on an occasion like this we might have heard something from the Front Bench of the Opposition in regard to the Excise duties on matches which we are also considering. Had the hon. Member risen to his feet to point out that this burden is, as it must be, a burden ultimately on the consumers of this country, and had he urged that that Excise duty was not desirable under the present state of affairs, I think the whole Committee would have been relieved and would have realised that at last we had had an admission of value from the Labour party. Had he taken that attitude, I think he would have met with a great deal of sympathy from that section of the Opposition that represents one-third of the trade union vote at the conference

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    this year, because I think that at present at least half—possibly more—of the matches we consume come from foreign countries. When it is realised that these matches are produced under the most disgraceful conditions in the countries from which they are imported, I think the Opposition have missed a real chance in not insisting that this Excise duty should be withdrawn. Had they done so they would have had the support of a great number of hon. Members.
    Mr. KELLY: I was very much interested to hear the last speaker in regard to the labour conditions in this particular industry. I was hoping that in the course of it he would have at least dropped one or two figures as to the conditions that he complained of in those countries, and that he would have told us of the conditions operating in this country. It may be some surprise to him to know that among Friends of his own are those who are financing some of those companies of which he speaks as foreign companies. But I want to ask him why it is that he is so fond of stating that this is only a small imposition upon the community, when he knows full well that there are so many other impositions on them that this means an added burden to the costs that are imposed on them? But I rose for the purpose of asking the view of the deputation that waited on the Treasury. I want to know if, seeing that there is a Whitley Council in connection with the match industry in this country, and that Whitley Council is concerned with both employers and employed and with all the match factories in this country, they were consulted or if they were part of the deputation which waited on the Treasury? It seems a very curious statement that we had from the Chancellor of the Exchequer, that if he would impose a duty upon matches that would be to the advantage of this country and particularly to those manufacturers. There is a difference between the statement of the hon. Member for Ripon to-night and the statement he made when he last spoke on the question. He will find it somewhat difficult to prove that the manufacturers or the wholesalers are going to stand the bulk of this impost, which he assumes is not going to reach the public. But the serious thing is that if the Amendment is not accepted, it is evident that
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    it is the intention of the Government to carry this tax a long period beyond the year we are now in. I hope the Amendment will be accepted, and I trust the Financial Secretary will let us know whether, not only the manufacturers, but the Whitley Councils concerned with the industry were consulted or were with the deputation to the Treasury.
    Mr. McNEILL: We have had a Debate not merely on the Amendment on the Paper, but upon the whole question of the duty. The hon. Member who has just sat down is the only one who made any allowance or reference whatever to the Amendment. I think I may take it from the way it was treated by the hon. Member on the Front Bench that he did not expect that any particular favour would be shown to the Amendment. He was only using it as an opportunity for discussing the general subject. If that was his state of mind, he was perfectly accurate. The Government could not possibly accept the Amendment. It would restrict clearances, with the result that there would be a very serious deficit in the estimated revenue. We have known the Mover of the Amendment for many years as a protagonist of Free Trade. If we were to carry the Amendment we should be going considerably beyond Free Trade. It would be giving Protection to the foreigner, as there is no corresponding Amendment down with regard to the second Sub-section, relating to Excise.
    One or two hon. Members have shown some curiosity as to where the duty would fall. The hon. Member for Keighley (Mr. Lee-Smith) told us it would fall on the poor, and he used an argument that is very common in these Debates but which. I think, really involves a fallacy, when he said it would fall on those least able to bear it. Of course, that is true not only of any duty but of the price of any article. The poorer a person is, the more difficult it is for him to pay far it. It is perfectly true. It is obvious. But what I think involves a fallacy when we are discussing these taxation questions is to isolate every individual item—to take them separately. It is perfectly true that if you take each one separately and say, "There is a tax on such a commodity. It is much more difficult for the poor to pay it than for the rich. Then there

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    is the next tax which is proposed. That also is much more difficult for the poor to pay than for the rich. Consequently, you are putting heavier burdens upon the poor than you are upon the rich."
    That appears to me to involve a fallacy. The only way you can justly estimate and gauge the relative burdens of different classes is by making a review of the whole field of taxation. It is perfectly true that certain classes pay practically nothing on matches, and it does not affect them in the least, but you have to find out what that same class is paying in other ways. It is only when you do that, and sum up the actual aggregate of burdens which falls upon the rich or poor, as the case may be, that you have any right to say with justice that an undue amount of burden is being placed upon people who are moderately well to do, or the rich. The bon. Member for Leith (Mr. E. Brown) and the hon. Member who last spoke asked me some questions about some deputation at the Treasury. I am not able to give them information about it. I am not certain that I should think it right to do so, even if I were in a position to do so, but I am not. I have had no notice sent to me that there was any curiosity felt about it. I do not know exactly whether it was in the form of a deputation at all.
    Mr. E. BROWN: The right hon. Gentleman rather pressed me on the Financial Resolution, but, unfortunately, when I came to ask him the question at that time, it was so late that he was unable to give an answer then.
    Mr. McNEILL: If the hon. Member in any way gave me actual notice that he was going to put that point to me, I apologise for not having remembered that was so. I am not at all sure that I should have given it in any case. I do not know that there were negotiations. I know that communications passed, as is always the case when a Budget is being prepared. There are always negotiations with many interests concerned or that might possibly be concerned. I do not think it is usual to give specific information as to who was present and what was said, and so forth. At all events, we are not discussing whether I shall be right or wrong in withholding the information, because I have not any to give.
    Mr. KELLY: My only reason for raising this point is that it was a strong point used by the Chancellor of the Exchequer himself, namely, that, as a result of what he had been told by those people, and the suggestion they made to him, he was coming before the Committee with this particular proposal. Surely we have a right to know the people who made that statement.
    Mr. McNEILL: I do not think there is any such right. These deputations are received at the Treasury in the ordinary course, and there is no right on the part of hon. Members to ask who were there, or what actually happened. Hon. Members must be content to take the statement of the Chancellor of the Exchequer on that point, or to disregard it, if they so please. I should like to endorse what was said by the hon. and gallant Member for Ripon (Major Hills), who speaks with much inside knowledge. He explained to the Committee quite accurately what the probabilities are with regard to the incidence of this duty, and to what he said I really have nothing to add.
    Mr. A. V. ALEXANDER: One or two things have transpired during this Debate which are worthy of a little further attention from the Committee. The Financial Secretary has said that the hon. Member who moved the Amendment failed to pursue the argument in that he has not put down an Amendment to the Excise section of the Clause. The Financial Secretary, however, failed to draw the attention of the Committee to the fact that there is an Amendment on the Paper to delete the whole of the Clause, which, of course, would get rid of the Excise duty as well as the Customs duty. It would have been a fairer comment if the Financial Secretary, in his reply, had informed the Committee that this is not the only Amendment that has been put down. The second point which the hon. Member made was quite interesting to hon. Members on this side. He said that he could not understand why we should lay so much stress on the fact that duties of this kind press harder on the poor; that we should always have regard to the general spread of taxation over the whole community and not pay so much attention to an isolated duty of this kind. The Financial Secretary knows that the case of those who oppose

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    these duties is that in regard to the taxation to be raised for purposes of revenue the first principle to be observed is that the people who have to pay the taxation shall be able to bear it. The great mass of the workers of this country are entitled to a minimum standard of life before they pay taxation at all. It is unfair for the hon. Gentleman to take any other view of the situation. Whilst the exigencies of the country may require special measures at certain times, we ought not to be stooping to the expediency of putting a few coppers on the matches of the poor for the purpose of raising revenue when you are saving millions a year by rebates to the rich Income Tax and Super-tax payers. What we suggest is that you should take off this kind of taxation altogether and raise all the revenue required in two ways only; first, in direct taxation upon the incomes of the rich, in relation to their ability to pay—
    The CHAIRMAN: This subject cannot be raised on this Amendment. It is quite proper on Second Reading or Third Reading.
    Mr. ALEXANDER: It is a little wide of the Amendment. On the other hand, it is surely not wide of the argument used by the Financial Secretary.
    The CHAIRMAN: I take the Committee into my confidence. If the right hon. Gentleman had said another sentence I was going to stop him.
    Mr. ALEXANDER: I will not take a minute to finish the argument with your permission, Sir. If they would raise the money by direct taxation, as I have suggested, with, as occasion required, a tax upon purely luxury articles, there would be no difficulty in meeting the needs of the revenue and giving proper relief to the poor in the country. With regard to the suggestion of my hon. and gallant Friend the Member for Bourne mouth (Sir H. Croft), I notice he says there would be great advantage if he were to remove the Excise duty and leave on the Customs duty. He says that matches are being imported in large quantities from countries where sweated conditions prevail. It is a great pity that the hon. and gallant Member cannot persuade his Government to ratify the 48-hour week Convention. There might then
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    be some point in his argument. I have here a box of matches imported from Finland and made by co-operators in Finland. We buy large quantities of them. We also buy large quantities of the matches which are more familiar to the hon. and gallant Member for Ripon (Major Hills) from the firm of Bryant and May. But the import of these matches is as important to the British worker as the purchase of the British matches. [HON. MEMBERS: "Why?"] I will explain why. We took thousands of gross of these matches from Finland last year and we sold to them, from co-operative factories here, employing trade union labour, thousands of bicycles and other articles such as boots and shoes, and that is just as important to the worker here as the actual manufacture of matches in tins country.
    Major HILLS: I do not think the hon. Member can know the wages paid in match factories in Finland. I have here the result of an inquiry made by the Belgian Christian Union into wages in match factories, and in Belgium the highest rate per lions is 6d., and it goes down as low as 2d. In Finland the highest rate is 5½d. per hour, and it goes down to 2½. for girls.
    Mr. ALEXANDER: Before the hon. and gallant Member destroys my case, he had better give me the figures for the co-operative factories. I said the matches were made by co-operators. He might also give the comparative cost of living.
    Major HILLS: My figures are given by the Finnish Government.
    Mr. ALEXANDER: I submit that that does not discredit my argument.
    Sir H. CROFT: Buying sweated goods!
    Mr. ALEXANDER: No, we are selling very good goods, made by trade union labour in Birmingham, among other places, and incidentally we are employing shipping to take the matches here and to take the goods away, and shipbuilders to build the ships. Altogether the case which has been put up by the hon. And gallant Member cannot stand.
    Mr. J. JONES: Those of us who live in the East End of London and who can take our memories back 30 or 40 years, never want to see again the conditions

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    which formerly prevailed in the match factories. If this were a question of protecting the workers of Great Britain from sweating, some of us might be prepared to take up a different attitude. This is not a matter of sweating. Hon. Members who talk so glibly about foreign matches have evidently not read the "Times" during the last few weeks. They have not read that these foreign match companies are raising money in England for the purpose of developing their businesses in competition with British manufacturers. They are getting plenty of money. Patriotic Tariff Reformers will be able to make higher dividends on their capital than if they invested it in the British match industry. They are always patriots when it is a matter of getting votes. When it is a question of getting dividends they do not care a tinker's curse whether it is the Chinaman, the Belgian, the Flemish or the Finnish worker—[Interruption].
    Sir H. CROFT: Would you keep them out?
    Mr. JONES: We could not keep you out if we tried. You are more dangerous to us than any workmen that ever came into this country.
    The CHAIRMAN: I must point out that the hon. and gallant Member for Bournemouth (Sir H. Croft) is not a match.
    Mr. JONES: No, but I am a match for him. I am a match for most of them. If it were merely a question of protecting the workers of England we should have various views expressed but this is a matter of raising revenue for the State. From whom are you going to get the revenue? The Government are always playing upon the worker. When in doubt, play upon the worker! It is a jolly fine game played slow; but it is about time we said "tip it." [Interruption.] Up to now I have not heard in this discussion any question of the general strike. It is the only time it has not been mentioned. Seeing that it is a question of matches striking is not necessary.
    I suggest that the question of protecting the worker of this country has nothing to do with the question now before the Committee. It is a question of raising revenue and the Government
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    are raising it at the expense of the people least able to pay. That is the philosophy running through all the proposals which have been made up to now. If you want to protect the British workman, protect him against your own people who invest their money in foreign countries and throw the British workman out of employment. Some of them on these benches will take 10 per cent. in China rather than accept 5 per cent. in Great Britain. They do not care where their interest comes from so long as they get it. I remember the time when the match makers of the East End were amongst the most sweated and degraded workers in the country—and that was under the same firms.
    As an official of a union which represents a very large number of the men and women employed in the matchmaking industry I wish to ask if, when there were consultations between the Chancellor of the Exchequer and the trade, the workers' side was represented? Did we have any finger in the pie? Were we allowed to appear before the holy of holies, wiping our noses on the mat before we dared to enter? No. We were never asked—so far as I know. We were simply told what had happened—by the trade. Who are the trade? Certain individuals who happen to be at the top of the tree. They were not considering the interests of labour. They are international in I heir ramifications. The people in the match industry of Great Britain know that it is very largely dominated by the American combine.
    The Diamond Match Company is practically an American institution in which British capital is not the dominating factor. If it is a question of protecting British workers, we are prepared to adopt means of protecting them, but our means are totally different from yours. Your method is to rob them by making them pay more for the things they want, and, although some workers may be able to get a little more wage, it is only at the expense of their fellows. That sort of game ought not to be played by people representing any section of the community, and this matter ought not to be made a question of robbing Peter to pay Paul. These proposals are simply a reproduction of the old bad policy of the Tory Party, and they have got an ex-Liberal as Chancellor of the Exchequer to come along to do their execrable,

    371
    dirty work. I know most of the Ministers opposite are ex-something. On a question like this we have to save a few of the brands from the burning. Now is the accepted time. Now is the day of salvation. So far as we on this side are concerned, we stand by the principle that we have enunciated all through, which is that taxation should be based upon the ability of the people to pay. This kind of taxation is making the poor pay all the time and allowing

    Division No. 225.]

    AYES.

    [11.45 a.m.

    Alexander, A. V. (Sheffield, Hillsbro')

    Henderson, Right Hon. A. (Burnley)

    Salter, Dr. Alfred

    Ammon, Charles George

    Henderson, T. (Glasgow)

    Scurr, John

    Baker, Walter

    Hirst, G. H.

    Shepherd, Arthur Lewis

    Barnes, A.

    Hirst, W. (Bradford, South)

    Shiels, Dr Drummond

    Batey, Joseph

    Hudson, J, H. (Huddersfield)

    Short, Alfred (Wednesbury)

    Bowerman, Rt. Hon. Charles W.

    Hutchison, Sir Robert (Montrose)

    Sitch, Charles H.

    Broad, F. A.

    Jenkins, W. (Glamorgan, Neath)

    Smith, Ben (Bermondsey, Rotherhlthe)

    Brown, Ernest (Lelth)

    John, William (Rhondda, West)

    Smith, H B. Lees. (Keighley)

    Brown, James (Ayr and Bute)

    Johnston, Thomas (Dundee)

    Snell, Harry

    Buchanan, G.

    Jones, Henry Haydn (Merioneth)

    Snowden, Ht. Hon. Philip

    Charleton, H. C.

    Jones, J. J. (West Ham, Silvertown)

    Spoor, Rt. Hon. Benjamin Charles

    Clowes, S.

    Jones, Morgan (Caerphilly)

    Stamford, T. W.

    Cowan, D. M. (Scottish Universities)

    Jones, T. I. Mardy (Pontypridd)

    Stephen, Campbell

    Crawfurd. H. E.

    Kelly, W. T.

    Strauss, E. A.

    Dalton, Hugh

    Kennedy, T.

    Sullivan, J.

    Davies, Rhys John (Westhoughton)

    Lansbury, George

    Thorne, W. (West Ham, Plaistow)

    Day, Colonel Harry

    Lawrence, Susan

    Thurtle, Ernest

    Duckworth, John

    Lawson, John James

    Townend, A. E.

    Dunnico, H.

    Lee, F.

    Varley, Frank B.

    England, Colonel A.

    Lindley, F. W.

    Viant, S. P.

    Evans, Capt. Ernest (Welsh Univer.)

    Lunn, William

    Watson, W. M. (Dunfermline)

    Fenby, T. D.

    Mackinder, W

    Watts-Morgan. Lt.-Col. D. (Rhondda)

    Gardner, J. P.

    MacLaren, Andrew

    Webb, Rt. Hon. Sidney

    Garro-Jones, Captain G. M.

    Maclean, Nell (Glasgow, Govan)

    Wellock, Wilfred

    Gibbins, Joseph

    March, S.

    Welsh, J. C.

    Gillett, George M.

    Morris, R. H.

    Wiggins, William Martin

    Gosling, Harry

    Morrison, R. C. (Tottenham, N.)

    Wilkinson, Ellen C.

    Graham, D. M. (Lanark, Hamilton)

    Mosley, Oswald

    Williams. C. P. (Denbigh, Wrexham)

    Graham, Rt. Hon. Wm. (Edin., Cent.)

    Murnin, H.

    Williams, David (Swansea, East)

    Greenwood, A. (Nelson and Colne)

    Naylor, T. E.

    Williams, Dr. J. H. (Llaneliy)

    Grenfell, D. R. (Glamorgan)

    Pethick-Lawrence, F. W.

    Wilson, C. H. (Sheffield, Attercliffe)

    Grundy, T. W.

    Ponsonby, Arthur

    Wilson, R. J. (Jarrow)

    Hall, F. (York., W. R., Normanton)

    Potts, John S.

    Windsor, Walter

    Hall, G H. (Merthyr Tydvli)

    Riley, Ben

    Young, Robert (Lancaster, Newton)

    Hamilton, Sir R. (Orkney & Shetland)

    Ritson, J.

    Harris, Percy A.

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    TELLERS FOR THE AYES.—

    Hayday, Arthur

    Robinson, W. C. (Yorks, W. R., Elland)

    Mr. Charles Edwards and Mr.

    Hayes, John Henry

    Rose, Frank H.

    Whiteley.

    NOES.

    Acland-Troyte, Lieut.-Colonel

    Blundell, F. N.

    Christie, J. A.

    Agg-Gardner, Rt. Hon. Sir James T.

    Boothby, R. J. G.

    Churchill, Rt. Hon. Winston Spencer

    Ainsworth, Major Charles

    Bourne, Captain Robert Croft

    Churchman, Sir Arthur C.

    Albery, Irving James

    Braithwaite, Major A. N.

    Clayton, G. C.

    Alexander, E. E. (Leyton)

    Brocklebank, C. E. R.

    Cobb, Sir Cyril

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Brooke, Brigadier-General C. R. I.

    Cochrane, Commander Hon. A. D.

    Amery, Rt. Hon. Leopold C. M. S.

    Brown, Brig.-Gen. H. C. (Berks, Newb'y)

    Cockerill, Brig.-General Sir George

    Applin, Colonel R. V. K.

    Broun-Lindsay, Major H.

    Colfox, Major William Phillips

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Buchan, John

    Cooper, A. Duff

    Astbury, Lieut.-Commander F. W.

    Buckingham, Sir H.

    Cope, Major William

    Atholl, Duchess of

    Bullock, Captain M.

    Couper, J. B.

    Atkinson, C.

    Burman, J. B.

    Courthope, Colonel Sir G. L.

    Balfour, George (Hampstead)

    Butler, Sir Geoffrey

    Croft, Brigadier-General Sir H.

    Balniel, Lord

    Butt, Sir Alfred

    Crookshank, Cpt. H.(Lindsey, Gainsbro)

    Barnett, Major Sir Richard

    Campbell, E. T.

    Cunliffe, Sir Herbert

    Barnston, Major Sir Harry

    Cayzer, Maj. Sir Herbt. R. (Prtsmth.S.)

    Curzon, Captain Viscount

    Beamish, Rear-Admiral T. P. H.

    Cazalet, Captain Victor A.

    Dalkeith, Earl of

    Bennett, A. J.

    Chadwick, Sir Robert Burton

    Davidson, Major-General Sir John H.

    Betterton, Henry B.

    Chapman, Sir S.

    Davies, Maj. Geo. F. (Somerset, Yeovli)

    Birchali, Major J. Dearman

    Charteris, Brigadier-General J.

    Davies, Dr. Vernon

    those who are best able to pay to escape their responsibilities. Whatever our views may be about protecting the members of trade unions, we are not prepared to allow ourselves to be led up the garden to rote for Protection under false pretences. That is what these proposals mean, and that is why we are united in our opposition to them.
    Question put, "That those words be there inserted."
    The Committee divided: Ayes, 110; Noes, 234.

    Dawson, Sir Philip

    Hudson, Capt. A. U. M. (Hackney, N.)

    Rees, Sir Beddoe

    Dean, Arthur Wellesley

    Hume, Sir G. H.

    Remer, J. R.

    Dixon, Captain Rt. Hon. Herbert

    Huntingfield, Lord

    Rhys, Hon. C. A. U.

    Drewe, C.

    Inskip, Sir Thomas Walker H.

    Rice, Sir Frederick

    Eden, Captain Anthony

    Jackson, Sir H. (Wandsworth, Cen'l)

    Richardson, Sir P. W. (Sur'y, Ch'ts'y)

    Edmondson, Major A. J.

    Jacob, A. E.

    Roberts, Sir Samuel (Hereford)

    Elliot, Major Walter E.

    Jones, G. W. H. (Stoke Newington)

    Ropner, Major L.

    Ellis, R. G.

    Kidd, J. (Linlithgow)

    Russell, Alexander West (Tynemouth)

    Everard, W. Lindsay

    King, Commodore Henry Douglas

    Rye, F. G.

    Fairfax, Captain J. G.

    Kinloch-Cooke, Sir Clement

    Salmon, Major I.

    Falle, Sir Bertram G.

    Knox, Sir Alfred

    Samuel, Samuel (W'dsworth, Putney)

    Fielden, E. B.

    Lamb, J. Q.

    Sandeman, N. Stewart

    Finburgh, S.

    Lane Fox, Col. Rt. Hon. George R.

    Sanders, Sir Robert A.

    Ford, Sir P. J.

    Leigh, Sir John (Clapham)

    Sassoon, Sir Philip Albert Gustavs D.

    Forestier-Walker, Sir L.

    Lister, Cunliffe, Rt. Hon. Sir Philip

    Shaw, R. G. (Yorks, W. R., Sowerby)

    Forrest, W.

    Little, Dr. E. Graham

    Sheffield, Sir Berkeley

    Foxcroft, Captain C. T.

    Long, Major Eric

    Shepperson, E. W.

    Gadie, Lieut.-Col. Anthony

    Looker, Herbert William

    Simms, Dr. John M. (Co. Down)

    Galbraith, J. F. W.

    Lougher, Lewis

    Sinclair, Col. T. (Queen's Univ., Belfst)

    Gates, Percy

    Luce, Major-Gen. Sir Richard Herman

    Skelton, A. N.

    Gault, Lieut.-Col. Andrew Hamilton

    Lumley, L. R.

    Slaney, Major P. Kenyon

    Gibbs, Col. Rt. Hon. George Abraham

    Lynn, Sir R. J.

    Smith, R. W. (Aberd'n & Klnc'dlne, C.)

    Glimour, Lt.-Col. Rt. Hon. Sir John

    Macdonald, Capt. P. D. (I. of W.)

    Smith-Carington, Neville W.

    Glyn, Major R. G. C.

    Macdonald, R. (Glasgow, Cathcart)

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Gower, Sir Robert

    McDonnell, Colonel Hon. Angus

    Steel, Major Samuel Strang

    Grace, John

    McLean, Major A.

    Storry-Deans, R.

    Graham, Fergus (Cumberland, N.)

    Macmillan, Captain H.

    Stuart, Crichton-, Lord C.

    Grattan-Doyle, Sir N.

    McNeill, Rt. Hon. Ronald John

    Stuart, Hon. J. (Moray and Nairn)

    Greaves-Lord, Sir Walter

    Makins, Brigadier-General E.

    Sueter, Rear-Admiral Murray Fraser

    Greene, W. P. Crawford

    Malone, Major P. B.

    Sugden, Sir Wilfrid

    Grenfell, Edward C. (City of London)

    Manningham-Buller, Sir Mervyn

    Sykes, Major-Gen, Sir Frederick H.

    Gretton, Colonel Rt. Hon. John

    Margesson, Captain D.

    Templeton, W. P.

    Grotrian, H. Brent

    Marriott, Sir J. A. R.

    Thompson, Luke (Sunderland)

    Guinness, Rt. Hon. Walter E.

    Meyer, Sir Frank

    Thomson, Rt. Hon. Sir W. Mitchell-

    Gunston, Captain D. W.

    Milne, J. S. Wardlaw

    Tinne, J. A.

    Hacking, Captain Douglas H.

    Mitchell, S. (Lanark, Lanark)

    Titchfield, Major the Marquess of

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Mitchell, W. Foot (Saffron Walden)

    Tryon, Rt. Hon. George Clement

    Hammersley, S. S.

    Monseil, Eyres, Com. Rt. Hon. B. M.

    Vaughan-Morgan, Col. K. P.

    Harland, A.

    Moore. Lieut.-Colonel T. C. R. (Ayr)

    Wallace, Captain D. E.

    Harrison, G. J. C.

    Moreing, Captain A. H.

    Ward, Lt.-Col. A. L. (Kingston-on-Hull)

    Hartington, Marquess of

    Morrison-Bell, Sir Arthur Clive

    Warner, Brigadier-General W. W.

    Harvey, Major S. E. (Devon, Totnes)

    Murcnison, Sir Kenneth

    Warrender, Sir Victor

    Haslam, Henry C.

    Nelson, Sir Frank

    Waterhouse, Captain Charles

    Hawke, John Anthony

    Neville, Sir Reginald J.

    Watson, Sir F. (Pudsey and Otley)

    Headlam, Lieut.-Colonel C. M.

    Newman, Sir R. H. S. D. L. (Exeter)

    Wells, S. R.

    Henderson, Capt. H. R. (Oxl'd, Henley)

    Newton, Sir D. G. C. (Cambridge)

    Wheler, Major Sir Granville C. H.

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    O'Connor, T. J. (Bedford, Luton)

    Williams, A. M. (Cornwall, Northern)

    Heneage, Lieut.-Colonel Arthur P.

    O'Neill, Major Rt. Hon. Hugh

    Williams, Herbert G. (Reading)

    Henn, Sir Sydney H.

    Oman, Sir Charles William C.

    Winterton, Rt. Hon. Earl

    Hennessy, Major J. R. G.

    Ormsby-Gore, Rt. Hon. William

    Wise, Sir Fredric

    Herbert, Dennis (Hertford, Watford)

    Penny, Frederick George

    Withers, John James

    Hills, Major John Waller

    Percy, Lord Eustace (Hastings)

    Womersley, W. J.

    Hilton, Cecil

    Perkins, Colonel E. K.

    Wood, B. C. (Somerset, Bridgwater)

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Perring, Sir William George

    Yerburgh, Major Robert D. T.

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Pitcher, G.

    Young, Rt. Hon. Sir Hilton (Norwich)

    Holt, Capt. H. P.

    Preston, William

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Price, Major C. W. M.

    TELLERS FOR THE NOES.—

    Hope, Sir Harry (Forfar)

    Radford, E. A.

    Mr. F. C. Thomson and Captain

    Hopkins, J. W. W.

    Raine, Sir Walter

    Bowyer.

    Motion made, and Question put, "That the Clause stand part of the Bill."

    Divison No. 226]

    AYES.

    [11. 52 p.m.

    Acland-Troyte, Lieut.-Colonel

    Bennett, A. J.

    Butt, Sir Alfred

    Agg-Gardner, Rt. Hon. Sir James T.

    Betterton, Henry B.

    Campbell, E. T.

    Ainsworth, Major Charles

    Birchall, Major J. Darman

    Cayzer, Maj. Sir Herbt.R (Prtsmth.S)

    Albery, Irving James

    Blundell, F. N.

    Cazalet, Captain Victor A.

    Alexander, Sir Wm. (Glasgow, Cent'l)

    Boothby, R. J. G.

    Chadwick, Sir Robert Burton

    Amery, Rt. Hon. Leopold C. M. S.

    Bourne, Captain Robert Croft

    Chapman, Sir S.

    Applin, Colonel R. V. K.

    Braithwaite, Major A. N.

    Charteris, Brigadier-General J.

    Ashley, Lt.-Col. Rt. Hon. Wilfrid W.

    Brocklebank, C. E. R.

    Christie, J. A.

    Astbury, Lieut.-Commander F. W.

    Brooke, Brigadier-General C. R. I.

    Churchill, Rt. Hon. Winston Spencer

    Atholl, Duchess of

    Broun-Lindsay, Major H.

    Churchman, Sir Arthur C.

    Atkinson, C.

    Brown, Brig.-Gen. H. C. (Berks,Newb'y)

    Clayton, G. C.

    Balfour, George (Hampstead)

    Buchan, John

    Cobb, Sir Cyril

    Balniel, Lord

    Buckingham, Sir H.

    Cochrane, Commander Hon. A. D.

    Barnett, Major Sir Richard

    Bullock, Captain M.

    Cockerill, Brig.-General Sir George

    Barnston, Major Sir Harry

    Burman, J. B.

    Colfox, Major Wm. Phillips

    Beamish, Rear-Admiral T. P. H.

    Butler, Sir Geoffrey

    Cooper, A. Duff

    The Committee divided: Ayes, 230; Noes, 108.

    Cope, Major William

    Herbert, Dennis (Hertford, Watford)

    Radford, E. A.

    Couper, J. B.

    Hills, Major John Waller

    Raine, Sir Walter

    Courthope, Colonel Sir G. L.

    Hilton, Cecil

    Rees, Sir Beddoe

    Croft, Brigadier-General Sir H.

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Remer, J. R.

    Crookshank, Cpt. H.(Lindsey, Gainsbro)

    Hogg, Rt. Hon. Sir D. (St. Marylebone)

    Rhys, Hon. C. A. U.

    Cunliffe, Sir Herbert

    Holt, Captain H. P.

    Rice, Sir Frederick

    Curzon, Captain Viscount

    Hope, Capt. A. O. J. (Warw'k, Nun.)

    Richardson, Sir P. W. (Sur'y, Ctrts'y)

    Dalkeith, Earl of

    Hope, Sir Harry (Forfar)

    Roberts, Sir Samuel (Hereford)

    Davidson, Major-General Sir J. H.

    Hopkins, J. W. W.

    Ropner, Major L.

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    Hudson, Capt. A. U. M. (Hackney, N.)

    Russell, Alexander West (Tynemouth)

    Davies, Dr. Vernon

    Hume, Sir G. H.

    Rye, F. G.

    Dawson, Sir Philip

    Huntingfield, Lord

    Salmon, Major I.

    Dean, Arthur Wellesley

    Inskip, Sir Thomas Walker H.

    Samuel, Samuel (W'dsworth, Putney)

    Dixon, Captain Rt. Hon. Herbert

    Jackson, Sir H. (Wandsworth, Cen'l)

    Sandeman N. Stewart

    Drewe, C.

    Jacob, A. E.

    Sanders, Sir Robert A.

    Eden, Captain Anthony

    Jones, G. W. H. (Stoke Newington)

    Sassoon, Sir Philip Albert Gustave D.

    Edmondson, Major A. J.

    Kidd. J. (Linlithgow)

    Shaw, R. G. (Yorks, W. R., Sowerby)

    Elliot, Major Walter E.

    King, Commodore Henry Douglas

    Sheffield, Sir Berkeley

    Ellis, R. G.

    Kinloch-Cooke, Sir Clement

    Shepperson, E. W.

    Everard, W. Lindsay

    Knox, Sir Alfred

    Simms, Dr. John M. (Co. Down)

    Fairfax, Captain J. G.

    Lamb, J. Q.

    Sinclair, Col. T. (Queen'sUniv., Bell'st.)

    Falle, Sir Bertram G.

    Lane Fox, Col. Rt. Hon. George R.

    Skelton, A. N.

    Finburgh, S.

    Leigh, Sir John (Clapham)

    Slaney, Major P. Kenyon

    Ford, Sir P. J.

    Lister, Cunliffe, Rt. Hon. Sir Philip

    Smith, R. W. (Aberd'n & Kinc'dine, C.)

    Forestier-Walker, Sir L.

    Long, Major Eric

    Smith-Carington, Neville W.

    Forrest, W.

    Looker, Herbert William

    Stanley, Lieut.-Colonel Rt. Hon. G. F.

    Foxcroft, Captain C. T.

    Lougher, Lewis

    Steel, Major Samuel Strang

    Fraser, Captain Ian

    Luce, Major-Gen. Sir Richard Harman

    Storry-Deans, R.

    Gadie, Lieut.-Col. Anthony

    Lumley, L. R.

    Stuart, Crichton-, Lord C.

    Galbralth, J. F. W.

    Lynn, Sir R. J.

    Stuart, Hon J. (Moray and Nairn)

    Gates, Percy

    Macdonald, Capt. P. D. (I. of W.)

    Sueter, Roar-Admiral Murray Fraser

    Gault, Lieut.-Col. Andrew Hamilton

    Macdonnell, Colonel Hon. Angus

    Sugden, Sir Wilfrid

    Gibbs, Col. Rt. Hon. George Abraham

    McLean, Major A.

    Sykes, Major-Gen. Sir Frederick H.

    Gilmour, Lt.-Col. Rt. Hon. Sir John

    Macmillan, Captain H.

    Templeton, W. P.

    Glyn, Major R. G. C.

    McNeill Rt. Hon. Ronald John

    Thompson, Luke (Sunderland)

    Goff, Sir Park

    Makins, Brigadier-General E.

    Thomson, F. C. (Aberdeen, South)

    Gower, Sir Robert

    Malone, Major P. B.

    Thomson, Rt. Hon. Sir W. Mitchell-

    Grace, John

    Manningham-Buller, Sir Mervyn

    Tinne, J. A.

    Graham, Fergus (Cumberland, N.)

    Marriott, Sir J. A. R.

    Titchfield, Major the Marquess of

    Grattan-Doyle, Sir N.

    Meyer, Sir Frank

    Tryon, Rt. Hon. George Clement

    Greaves-Lord, Sir Walter

    Milne, J. S. Wardlaw-

    Vaughan-Morgan, Col. K. P.

    Greene, W. P. Crawford

    Mitchell, S. (Lanark, Lanark)

    Wallace, Captain D. E.

    Grenfell, Edward C. (City of London)

    Mitchell, W. Foot (Saffron Walden)

    Ward, Lt. Col. A. L. (Kingston-on-Hull)

    Gretton, Colonel Rt. Hon. John

    Monsell, Eyres, Com. Rt. Hon. B. M.

    Warner, Brigadier-General W. W.

    Grotrian, H. Brent

    Moore, Lieut.-Colonel T. C. R. (Ayr)

    Warrender, Sir Victor

    Guinness, Rt. Hon. Walter E.

    Moore, Sir Newton J.

    Waterhouse, Captain Charles

    Gunston, Captain D. W.

    Moreing, Captain A. H.

    Watson, Sir F. (Pudsey and Otley)

    Hacking, Captain Douglas H.

    Morrison-Bell, Sir Arthur Clive

    Wells, S. R.

    Hall, Lieut.-Col. Sir F. (Dulwich)

    Murchison, Sir Kenneth

    Wheler, Major Sir Granville C. H.

    Hammersley, S. S.

    Nelson, Sir Frank

    Williams, A. M. (Cornwall, Northern)

    Harland, A.

    Neville, Sir Reginald J.

    Williams, Herbert G. (Reading)

    Harrison, G. J. C.

    Newman. Sir R. H. S. D. L. (Exeter)

    Winterton, Rt. Hon. Earl

    Hartington, Marquess of

    Newton, Sir D. G. C. (Cambridge)

    Wise, Sir Fredric

    Harvey, Major S. E. (Devon, Totnes)

    O'Connor, T. J. (Bedford, Luton)

    Withers, John James

    Haslam, Henry C.

    O'Neill, Major Rt. Hon. Hugh

    Womersley, W. J.

    Hawke, John Anthony

    Oman, Sir Charles William C.

    Wood, B. C. (Somerset, Bridgwater)

    Headlam, Lieut.-Colonel C. M.

    Ormsby-Gore, Rt. Hon. William

    Yerburgh, Major Robert D. T.

    Henderson, Capt. R. R. (Oxford, Henley)

    Penny, Frederick George

    Young. Rt. Hon. Sir Hilton (Norwich)

    Henderson, Lt.-Col. Sir V. L. (Bootle)

    Percy, Lord Eustace (Hastings)

    Heneage, Lieut.-Colonel Arthur P.

    Perkins, Colonel E. K.

    TELLERS FOR THE AYES.—

    Henn, Sir Sydney H.

    Perring, Sir William George

    Captain Margesson and Captain

    Hennessy, Major J. R. G.

    Price, Major C. W. M.

    Bowyer.

    NOES.

    Alexander, A. V. (Sheffield, Hillsbro')

    England, Colonel A.

    Henderson, Rt. Hon. A. (Burnley)

    Ammon, Charles George

    Evans, Capt. Ernest (Welsh Univer.)

    Henderson, T. (Glasgow)

    Barnes, A.

    Fenby, T. D.

    Hirst, G. H.

    Batey, Joseph

    Gardner, J. P.

    Hirst, W. (Bradford, South)

    Bowerman, Rt. Hon. Charles W.

    Garro-Jones, Captain G. M.

    Hudson. J. H. (Huddersfield)

    Broad, F. A.

    Gibbins, Joseph

    Hutchison, Sir Robert (Montrose)

    Brown, Ernest (Leith)

    Gillett, George M.

    Jenkins, W. (Glamorgan, Neath)

    Brown, James (Ayr and Bute)

    Gosling, Harry

    John William (Rhondda, West)

    Buchanan, G.

    Graham, D. M. (Lanark, Hamilton)

    Johnston, Thomas (Dundee)

    Charleton, H. C.

    Greenwood, A. (Nelson and Colne)

    Jones, Henry Haydn (Merioneth)

    Clowes, S.

    Grenfell, D. R. (Glamorgan)

    Jones, J. J. (West Ham, Silvertown)

    Cowan, D. M. (Scottish Universities)

    Grundy, T. W.

    Jones, Morgan (Caerphilly)

    Crawfurd, H. E.

    Hall, F. (York, W. R., Normanton)

    Jones, T. I. Mardy (Pontypridd)

    Dalton, Hugh

    Hall, G. H. (Merthyr Tydvil)

    Kelly, W. T.

    Davies, Rhys John (Westhoughton)

    Hamilton, Sir R. (Orkney & Shetland)

    Kennedy, T.

    Day, Colonel Harry

    Harris, Percy A.

    Lansbury, George

    Duckworth, John

    Hayday, Arthur

    Lawrence, Susan

    Dunnico, H.

    Hayes, John Henry

    Lawson, John James

    376

    377

    Lee, F.

    Salter, Dr. Alfred

    Viant, S. P.

    Lindley, F. W.

    Scurr, John

    Watson, W. M. (Dunfermline)

    Lunn, William

    Shepherd, Arthur Lewis

    Watts-Morgan, Lt.-Col. D. (Rhondda)

    Mackinder, W.

    Shiels, Dr. Drummond

    Webb, Rt. Hon. Sidney

    MacLaren, Andrew

    Short, Alfred (Wednesbury)

    Wellock, Wilfred

    Maclean, Nell (Glasgow, Govan)

    Sitch, Charles H.

    Welsh, J. C.

    March, S.

    Smith, Ben (Bermondsey, Rotherlthe)

    Wiggins, William Martin

    Morris, R. H.

    Smith, H. B. Lees- (Keighley)

    Wilkinson, Ellen C.

    Morrison, R. C. (Tottenham, N.)

    Snell, Harry

    Williams, C. P. (Denbigh, Wrexham)

    Mosley, Oswald

    Snowden, Rt. Hon. Philip

    Williams, David (Swansea, E.)

    Murnin, H.

    Spoor, Rt. Hon. Benjamin Charles

    Williams, Dr. J. H. (Llanelly)

    Naylor, T. E.

    Stamford, T. W.

    Wilson, C. H. (Sheffield, Attercliffe)

    Pethick-Lawrence, F. W.

    Stephen, Campbell

    Wilson, R. J. (Jarrow)

    Ponsonby, Arthur

    Strauss, E. A.

    Windsor, Walter

    Potts, John S.

    Sullivan, J.

    Young, Robert (Lancaster, Newton)

    Riley, Ben

    Thorne, W. (West Han, Plaistow)

    Ritson, J.

    Thurtle, Ernest

    TELLERS FOR THE NOES.—

    Roberts, Rt. Hon. F. O. (W. Bromwich)

    Townend, A. E.

    Mr. Charles Edwards and Mr.

    Robinson, W. C. (Yorks, W. R., Elland)

    Variey, Frank B.

    Whiteley.

    Rose, Frank H.

    CLAUSE 9.—Customs duty on translucent or vitrifled pottery.)
    Mr. SNOWDEN: I beg to move, "That the Chairman do report Progress and ask leave to sit again."
    It. will not be denied that we have made considerable progress to-day, and I think it will be the general wish that we should now adjourn. I think that suggestion will be accepted by the Government.
    Mr. CHURCHILL: I cannot deny that we have made very great progress, and, although I had hoped to divide the advantage of getting Clause 9 with that of witnessing the eclipse, I recognise the reasonableness of the suggestion that has been made. I appreciate the Parliamentary efficiency with which our Debates have been conducted, and that we have covered much ground. The issue in regard to pottery, which is raised by Clause 9, is one on which hon. and right hon. Members opposite feel very strongly, and the President of the Board of Trade is quite prepared to encounter it in the full light of day. There is the question of the Road Fund, which we have a great desire to bring forward for a good debate. There is the question of the
    378
    Betting Duty, which I understand will be debated on a new Clause. It is desirable there should be a full Debate on that. Then there is the question of Income Tax. We ought to be able so to arrange our business as to get these issues clearly and well defined, and at the same time to get on with the numerous provisions of this complicated Bill in a satisfactory manner. Believing that I am expressing the feeling in all parts of the House, I shall not resist the proposal that we do report Progress, and ask leave to sit again.
    Question put, and agreed to.
    Committee report Progress; to sit again upon Thursday.
    The remaining Orders were read and postponed.
    It being after half-past Eleven of the Clock upon Tuesday evening, Mr. Deputy-Speaker (Mr. James Hope) adjourned the House, without Question put, pursuant to the Standing Order.
    Adjourned at Six Minutes after Twelve o'Clock.

  WHITLEY COUNCILS.
  WHITLEY COUNCILS.
  LOCAL EMPLOYMENT COMMITTEES.
  LOCAL EMPLOYMENT COMMITTEES.
  AFFORESTATION.
  AFFORESTATION.
  RUBBER OUTPUT (RESTRICTION).
  RUBBER OUTPUT (RESTRICTION).
  ESTATES IN LIQUIDATION.
  ESTATES IN LIQUIDATION.
  BUILDERS' WOODWORK (IMPORTS).
  BUILDERS' WOODWORK (IMPORTS).
COAL MINING INDUSTRY.
  PRICES.
  PRICES.
  CONSUMPTION.
  CONSUMPTION.
  PRODUCTION (FOREIGN COUNTRIES).
  PRODUCTION (FOREIGN COUNTRIES).
POST OFFICE.
  TELEPHONE SYSTEM (DEVELOPMENT).
  TELEPHONE SYSTEM (DEVELOPMENT).
  MAILS, TARBERT.
  MAILS, TARBERT.
  TELEPHONE OPERATOR, TARBERT.
  TELEPHONE OPERATOR, TARBERT.
  TEACHERS' PENSIONS.
  TEACHERS' PENSIONS.
  ROADS (EXPENDITURE ON MAINTENANCE).
  ROADS (EXPENDITURE ON MAINTENANCE).
  AGRICULTURE (INQUIRY).
  AGRICULTURE (INQUIRY).
  ST. STEPHEN'S HALL (PICTURES).
  ST. STEPHEN'S HALL (PICTURES).
Preamble
The House met at a quarter past four of the clock, The LORD CHANCELLOR on the Woolsack.
BUSINESS OF THE HOUSE.
THE LORD PRIVY SEAL (THE MARQUESS OF SALISBURY): My Lords, with reference to the conversation which took place in your Lordships' House at the beginning of business yesterday, I desire in the first place to apologise to your Lordships for the fact that I was not present. If I had had the least idea that the conduct of business was going to be called in question I need not say that I should certainly have been at your Lordships' disposal. I think that what was said yesterday cannot be entirely passed over in silence, but with your Lordships' leave I do not propose to say anything this afternoon because an intimation has been given to me that my noble friend Lord Newton, who took rather a prominent part in the discussion last night, cannot be present this afternoon. Accordingly, with your Lordships' leave, I will not say anything further on the subject until tomorrow.
COUNTY OF LONDON ELECTRIC SUPPLY COMPANY BILL.
Read 2a.
EAST ANGLIAN ELECTRICITY BILL.
Read 2a.
GREENOCK BURGH EXTENSION, ETC., BILL.
Read 2a.
NEWCASTLE-UPON-TYNE CORPORATION BILL.
Read 2a.
TORQUAY CORPORATION BILL.
Read 2a.
SCARBOROUGH GAS COMPANY (CONSOLIDATION) BILL. [H.L.]
Read 3a, and passed, and sent to the Commons.
MERSEY TUNNEL (BIRKENHEAD ENTRANCE, ETC.) BILL. [H.L.]
Read 3a, and passed, and sent to the Commons.
WEST BRIDGFORD URBAN DISTRICT COUNCIL BILL.
Read 3a, and passed.
WESTGATE AND BIRCHINGTON WATER BILL.
Read 3a, with the Amendments, and passed, and returned to the Commons.
OUSE AND CAM FISHERIES PROVISIONAL ORDER BILL.
Read 2a (according to Order).

COMPANIES BILL. [H.L.]
Amendments reported (according to Order).
Clause 1:
Restriction on registration of companies by certain names.
1.—(1) A company shall not, except with the consent of the Board of Trade, be registered by a name which contains the word "Royal" or "Imperial," or which in the opinion of the registrar suggests, or is calculated to suggest, the patronage of His Majesty or of any member of the Royal Family or connection with His Majesty's Government or any department thereof.
(3) No company shall hereafter be registered under a name of which the words "building society" form part.
THE LORD CHANCELLOR (VISCOUNT CAVE)THE LORD CHANCELLOR (VISCOUNT CAVE) moved, in subsection (1), after "imperial," to insert "or 'municipal.'" The noble and learned Viscount said: My Lords, this Amendment provides that a company shall not, except with the consent of the Board of Trade, be registered by a name which contains the word "municipal," thus suggesting a connection with local authorities. This has been done in certain instances, and some difficulty has been caused, and it
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is thought desirable to prevent the practice. The two Amendments that follow are respectively consequential and drafting.
Amendment moved—
Page 1, line 8, after ("Imperial") insert ("or 'municipal'").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Amendments moved—
Page 1, line 12, after ("thereof") insert ("or with any municipality or other local authority")
Page 2, line 11, leave out ("hereafter").—(The Lord Chancellor.)
On Question, Amendments agreed to.
Clause 4:
index of members of company.
4.—(1) Every company shall keep an index of the names of the members of the company and shall, within fourteen days after the date on which any alteration is made in the register of the members, make any necessary alteration in the index.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, after "Every company," to insert "having more than fifty members." The noble and learned Viscount said: My Lords, it was pointed out in the discussion in Committee that to require a company of two members, for instance, to comply with this clause would give unnecessary trouble, and to meet that point I propose to confine the clause to a company having more than fifty members.
Amendment moved—
Page 3, line 9, after ("company") insert ("having more than fifty members").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 5 [Amendment of s. 26 of principal Act]:
THE LORD CHANCELLOR: My Lords, my Amendments to this clause are drafting.
Amendments moved—
Page 4 line 7, leave out ("registered address") and insert ("address of the registered office")
Page 4 lines 20 and 21, leave out ("to be forwarded to the registrar of companies")
Page 4 line 30, leave out ("filed together with") and insert ("annexed to").—(The Lord Chancellor.)
On Question, Amendments agreed to.
Clause 6:
Annual list of members and summary in case of company not having a share capital.
(4) Subsections (3), (4) and (5) of section twenty-six of the principal Act shall apply for the purposes of this section as if they were herein re-enacted with the substitution of a reference to the statement aforesaid for the reference to the summary.
THE LORD CHANCELLOR: My Lords, the first of the Amendments to this clause is purely drafting.
Amendment moved—
Page 5, line 31, leave out ("registered address") and insert ("address of the registered office").—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (4), to leave out "substitution of a reference to the statement aforesaid for the reference to the summary," and insert "omission in the said subsection (4) of the words 'and summary'." The noble and learned Viscount said: My Lords, this is also a drafting Amendment.
Amendment moved—
Page 6, line 5, leave out from ("the") to the end of the clause and insert ("omission in the said subsection (4) of the words 'and summary'").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 7:
Amendment of s. 30 of principal Act.
7. Section thirty of the principal Act (which relates to the inspection of the register of members) shall be amended as follows:—
(a) at the end of subsection (2) there shall be inserted the following paragraph:—
"The company shall cause any copy so required by any person to be sent to that, person within such period (commencing on the day next after the date on which the requirement is made to the company) as is hereinafter provided, that is to say, in the case of a company not having more than five hundred members, a period of three days, and in the case of any other company, a period of three days increased by one day for each one thousand additional members of the company, so, however, that the period shall not in any case exceed twenty-one days";
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, in paragraph (a), to leave out "made to" and insert "received by." The noble
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Earl said: My Lords, this Amendment is really only to alter "made to" to "received by" in regard to a request sent to the company.
Amendment moved—
Page 6, line 17, leave out ("made to") and insert ("received by").—(The Earl of Halsbury.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in paragraph (a), to substitute "seven" days for "three" days. The noble and learned Viscount said: My Lords, I have also a similar Amendment two lines later in the paragraph. The effect of the two Amendments is to increase the period allowed to a company for supplying a copy of its register of members from three to seven days. It has been pointed out by the Chartered Institute of Secretaries that in cases where Good Friday, Sundays and Bank Holidays are included in the three days it would be difficult for a company to comply with the provisions of the clause as it stands.
Amendments moved—
Page 6, line 20, leave out ("three") and insert ("seven")
Page 6, line 22, leave out ("three") and insert ("seven").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 12:
Prohibition of provision of financial assistance by company for purchase of its own shares.
12. Subject as hereinafter provided, it shall not be lawful for a company to give, whether directly or indirectly, and whether by means of a loan, guarantee, the provision of security or otherwise, any financial assistance for the purpose of or in connection with a purchase made or to be made by any person of any shares in the company:
Provided that nothing in this section shall be taken to prohibit—
(b) the provision by a company, in accordance with any scheme for the time being in force, of money for the purchase by trustees of shares in the company to be held for the benefit of employees of the company;
If a company acts in contravention of the provisions of this section it shall be liable to a fine not exceeding one hundred pounds, and every director, manager, secretary or other officer of the company who knowingly and wilfully authorises or permits the default shall be liable to the like penalty.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in proviso (b), after "held" to insert "by or," The noble and learned Viscount said: My Lords, the effect of the Amendment is that shares which have been purchased by money provided by the company for the benefit of employees of the company can be transferred into the names of the employees.
Amendment moved—
Page 9, line:32, after ("held") insert ("by or").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Amendment moved—
Page 10, line 1, leave out ("default") and insert ("contravention").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 13:
Rights of holders of special classes of shares.
13.—(1) If in the case of any company, the share capital of which is divided into different, classes of shares, provision is made by the memorandum or articles for authorising the variation of the rights attached to any class of shares in the company, subject to the consent of any specified proportion of the holders of the issued shares of that class or the sanction of a resolution passed at a separate meeting of the holders of those shares, and in pursuance of the said provision the rights attached to any such class of shares are at any time varied, the holders of not less in the aggregate than fifteen per cent. of the issued shares of that class, being persons who did not consent to, or vote in favour of the resolution for, the variation, may apply to the Court to have the variation cancelled, and where any such application is made the variation shall not have effect unless and until it is confirmed by the Court.
(2) An application under this section must be made within seven days after the date on which the consent was given or the resolution was passed, as the case may be, and may be made on behalf of the shareholders entitled to make the application by such one or more of their number as they may appoint in writing for the purpose.
(3) On any such application any shareholder of the class in question shall be entitled to be heard, and the Court shall, as it thinks fit, either disallow or confirm the variation.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to leave out all words in subsection (3) after "On any such application" and insert "the Court, after hearing the applicant, and any other persons who apply to the Court to be heard and appear to the Court to be interested in the application, may, if it is satisfied, having regard to all
1030
the circumstances of the case, that the variation would unfairly prejudice the shareholders of the class represented by the applicant, disallow the variation and shall, if not so satisfied, confirm the variation."
The noble and learned Viscount said: My Lords, in the debate in Committee it was pointed out, by, I think, Lord Russell and also by Lord Danesfort, that the clause contained no indication to the Court of the principle on which it should act in considering applications under Clause 13, which deals with the modification of the rights of holders of special classes of shares in the company. In order to meet that view I propose to insert the words of my Amendment, which I think meet the point made by Lord Russell.
Amendment moved—
Page 10, line 27, leave out from ("application") to end of subsection (3) and insert the proposed new words—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 14:
Power to issue redeeconable preference shares.
14.—(1) Subject to the provisions of this section, a company limited by shares may, if so authorised by its articles, issue preference shares which are, or at the option of the company are to be liable, to be redeemed:
Provided that—
(b) no such shares shall be redeemed unless they are fully paid;
(c) where any such shares are redeemed otherwise than out of the proceeds of a fresh issue there shall out of profits which would otherwise have been available for dividend be transferred to a permanent reserve fund, to be called "the capital redemption reserve fund," a sum equal to the amount applied in redeeming the shares, and the provisions of the principal Act relating to the reduction of the share capital of a company shall apply as if the capital redemption reserve fund were paid up share capital of the company.
(4) Where in pursuance of this section a company has redeemed or is about, to redeem any preference shares, it shall have power to issue shares of the like class up to the nominal amount of the shares redeemed or to be redeemed as if those shares had never been issued, and accordingly the share capital of the company shall not for the purposes of any enactments relating to stamp duty be deemed to be increased by the issue of shares in pursuance of this subsection:
Provided that where new shares are issued before the redemption of the old shares, the new shares shall not, so far as relates to stamp duty, be deemed to have been issued in pursuance of this subsection unless the old shares are redeemed within one month after the issue of the new shares.
VISCOUNT BERTIE OF THAME VISCOUNT BERTIE OF THAME moved, in subsection (1), to leave out paragraph (b). The noble Viscount said: My Lords, I ask your Lordships to omit this paragraph because if a company is in such a prosperous condition that it can afford to repay its preference shares, although only partly paid up, it shows that the company cannot profitably employ the cash available in its business. All that a company in such a happy position would have to do would be to call up the unpaid liability and then redeem the shares. It would have no use for this extra money, and it might be inconvenient to the shareholders to have to find it, and, anyhow, vexatious.
Amendment moved—
Page 11, line 11 and 12, leave out paragraph (b).—(Viscount Bertie of Thame.)
LORD HUNSDON OF HUNSDON: My Lords, I agree with Lord Bertie of Thame, and I suggest that the paragraph which the noble Viscount wishes to omit is rather useless, because so far as my knowledge is concerned I do not think there are such things as partly-paid-up preference shares. At, least I cannot recall them, and for that reason I support the Amendment.
THE LORD CHANCELLOR: My Lords, I agree with what Lord Hunsdon has said, that it must be very rare to find partly-paid preference shares, but if the case should arise, I do not think the Amendment should be accepted. The Report on which the Bill is based recommended that one of the restrictions under which companies should be allowed to issue redeemable preference shares should be that only fully-paid-up shares should be redeemed. There was good reason for that. If the Amendment were accepted it would be possible for a company to obtain money for the redemption of partly-paid-up shares by issuing shares for a much smaller amount, to be fully paid up, with the result that persons who had entered into transactions with the company, relying on the uncalled capital, would lose that security. I hope that on reflection the noble Viscount will not press his Amendment.
VISCOUNT BERTIE OF THAME: I can only reiterate what I have said that directors would do, but I will not press my Amendment.
Amendment, by leave, withdrawn.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, in subsection (1) (c), to leave out "permanent." The noble Earl said: My Lords, this Amendment is apparently a very small one, but it really is connected with an Amendment which comes later and which I mentioned in the Committee stage. The clause enacts that on redemption of preference shares a certain amount must go to a permanent reserve fund. As I asked in the Committee stage, what is going to happen to a company when, for perfectly proper purposes of its own, it decides to reissue these preference shares? That permanent fund ought then to be released pro tanto as the amount released from the preference shares for the general affairs of the company.
Amendment moved—
Page 11, line 17, leave out ("permanent").—(The Earl of Halsbury.)
THE LORD CHANCELLOR: I think this Amendment of the noble Earl and the one that follows have been agreed to by all parties concerned.
On Question, Amendment agreed to.
Amendment moved—
Page 11, line 22, after ("shall") insert ("except as hereinafter provided").—(The Earl of Halsbrury.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (4), to leave out "of the like class." The noble and learned Viscount said: My Lords, this is little more than a drafting Amendment. It was suggested by the Faculty of Procurators.
Amendment moved—
Page 12, lines 1 and 2, leave out ("of the like class").—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved to insert at the end of the clause:—
"(5) Where new shares have been issued in pursuance of the last foregoing subsection, the capital redemption reserve fund may, notwithstanding anything in this section, be applied by the company, up to an amount equal to the nominal amount of the shares so issued, in paying up unissued shares of the company to be issued to members of the company as fully paid bonus shares."

1033
The noble Earl said: My Lords, this follows from the previous Amendment.
Amendment moved—
Page 12, line 13, at end insert the said subsection.—(The Earl of Halsbury.)
On Question, Amendment agreed to.
Clause 18 [Amendment of s. 66 of principal Act]:
THE LORD CHANCELLOR: This and the following Amendments are purely drafting Amendments intended to bring this part of the clause into agreement with the earlier part of the clause.
Amendment moved—
Page 14, lines 28 and 29, leave out ("a majority of them in voting power") and insert the ("any of them representing more than halt of the total voting rights of all of them").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Amendment moved—
Page 14, lines 30 and 31, leave out ("convened by the requisitionists") and insert ("so convened").—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, after Clause 25, to insert the following new clause:—
Giving of professional advice not to constitute person a director of a company.
".It is hereby declared that a person shall not be deemed to be within the meaning of any provision in this Act or in any other enactment amending the principal Act a person in accordance with whose directions or instructions the directors of the company are accustomed to act, by reason only that the directors of the company act on the advice given by him in a professional capacity."
The noble Earl said: My Lords, this is a clause which extends the meaning of the word "director." On the Committee stage I suggested that it ought not to apply to a receiver or a manager or a person who merely gives professional advice. At this stage have dropped the question of a receiver or a manager and my Amendment merely says that a person who gives professional advice shall not be deemed to be a director.
Amendment moved—
Page 21, line 36, at end insert the said new clause.—(The Earl of Halsbury.)
THE LORD CHANCELLOR: My Lords, I am much obliged to the noble Earl for reconsidering his Amendment. I did on the Committee stage express
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my sympathy with this part of the Amendment and I think now it might be accepted.
On Question, Amendment agreed to.
Clause 26 [Provisions with respect to offers of shares or debentures for sale:]
THE LORD CHANCELLOR: My Lords, this and the following are drafting Amendments, because these words are defined by a definition clause.
Amendment moved—
Page 21, line 38, leave out ("bonds or similar obligations").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Amendment moved—
Page 21, line 40, leave out ("bonds or similar obligations").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 27:
Prohibition of issue of abridged prospectuses with application forms annexed.
27.—(1) It shall not be lawful, whether before or after the formation of any company, to issue to the public or to any member of the public or to publish in relation to any of the shares in or debentures of the company an abridged prospectus which contains or has annexed to it a form of application for, or an invitation to subscribe for any of those shares or debentures or otherwise to invite subscriptions for any of those shares or debentures by reference to or in connection with an abridged prospectus.
(2) If an abridged prospectus is issued or published or subscriptions for shares or debentures are invited in contravention of the provisions of this section, every person who is knowingly responsible for the issue, publication or invitation (including, in any case where the prospectus relates to shares in or debentures of a company which has been already formed, the company) shall be liable to a fine not exceeding five hundred pounds.
(3) For the purposes of this section the expression "abridged prospectus" means a prospectus containing only an abridgment or summary of all or some of the matters required by section eighty-one of the principal Act to be stated in a prospectus.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to add to subsection (1):
"Provided that this section shall not apply to an invitation to any person to subscribe for shares conditionally on the shares not being taken up by any other persons, or to an invitation to any person to procure subscriptions for any shares."
The noble and learned Viscount said: My Lords, the effect of this Amendment

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is that the prohibition of the issue of abridged prospectuses with application forms annexed will not interfere with the underwriting of shares in a proposed company.
Amendment moved—
Page 23, line 12, at end insert the said proviso.—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, at the end of the clause, to insert "and the expression 'member of the public' in relation to any company does not include a member of, or a holder of debentures of, that company." The noble Earl said: My Lords, this Amendment gives a definition of "member of the public," so that it does not include a member of, or a holder of debentures of the company.
Amendment moved—
Page 23, line 26, after ("prospectus") insert the said words.—(The Earl of Halsbury.)
THE LORD CHANCELLOR: I do not think the Amendment should be necessary, but the Government do not oppose it.
On Question, Amendment agreed to.
Clause 28:
Amendment of s. 81 of principal Act.
28.—(1) Section eighty-one of the principal Act (which prescribes the particulars which are to be stated in a prospectus) shall be amended as follows:—
(iv) Subsection (6) shall be amended by the insertion after paragraph (b) of the following words: "or, if the noncompliance was in respect of matters which in the opinion of the court dealing with the case were immaterial."
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to add to paragraph (iv) of subsection (1) "or was otherwise such as ought, in the opinion of that Court, having regard to all the circumstances of the case, reasonably to be excused." The noble and learned Viscount said: My Lords, an Amendment was moved by Lord Hunsdon in the Committee stage of the Bill to insert at the end of subsection (1) (iv) "or if in the opinion of the same Court it was not reasonably practicable to comply with the requirements of this section." That Amendment I was not able to accept, but I promised to consider the matter, and
1036
I have put down this Amendment which I am glad to see he also supports. I do not think these words go too far.
Amendment moved—
Page 24, line 43, after ("immaterial") insert the said words.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 29:
Amendment as to minimum subscription.
29.—(1) The words "the minimum subscription on which the directors may proceed to allotment and" in paragraph (d) of subsection (1) of Section eighty-one of the principal Act (which prescribes the particulars which are required to be stated in a prospectus) shall cease to have effect, and the, following new paragraph shall be inserted in the said subsection (1) after paragraph (c):—
"(cc) where shares are offered to the public for subscription the minimum amount which, in the opinion of the directors, must be raised by the issue of those shares in order to provide for each of the following matters:—

(i) the purchase price of any property purchased or to be purchased which is to be defrayed out of the proceeds of the issue:

(ii) any preliminary expenses payable by the company, and any commission so payable to any person in consideration of his agreeing conditionally to subscribe for, or of his procuring or agreeing to procure subscriptions for, any shares in the company;

THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in paragraph (ii) of subsection (1) to leave out "conditionally." The noble and learned Viscount said: My Lords, this is really a drafting Amendment consequential on later Amendments standing on the Paper in my name to Clause 33 under which commissions can be paid for agreeing unconditionally to subscribe except in the case of shares which are to be issued at a discount. I beg to move.
Amendment moved—
Page 25, line 31, leave out ("conditionally").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 20:
Obligation to file statement in lieu of prospectus.
30.—(1) A company having a share capital which does not issue a prospectus on or with reference to its formation, or which has issued such a prospectus but has not proceeded to allot any of the shares offered to the public for subscription, shall not

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allot any of its shares or debentures unless at least seven day,, before the first allotment of either shares or debentures there has been filed with the registrar of companies a statement in lien of prospectus signed by every person who is named therein as a director or a proposed director of the company or by his agent authorised in writing in a form containing the particulars set out in Part I of the First Schedule to this Act.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, in subsection (1), to leave out "seven" and insert "three." The noble Earl said: My Lords, in the Committee stage I moved to leave out the number of days so that there should be no delay between the filing with the registrar and the allotment. The Lord Chancellor was not willing that that should be done and at this stage I am moving an amendment that the days in the Bill should be changed from "seven" to "three." I beg to move.
Amendment moved—
Page 26, line 32, leave out "seven") and insert ("three").—(The Earl of Holsbury.)
THE LORD CHANCELLOR: My Lords, We had a discussion in Committee stage and this Amendment has been put down in accordance with the understanding arrived at during the debate. I then suggested that Lord Halsbury should consider four days. The noble Earl now accepts three and I have no objection to the Amendment.
On Question, Amendment agreed to.
Clause 32:
Power to issue shares at a discount.
32.—(1) It shall be lawful for a company, if the following conditions are satisfied, but not otherwise, to issue any shares in the company at a discount:—
(b) If the company has already issued shares of the same class as the shares to be issued—
(i) the market price of the shares of the class which have already been issued must be less than their nominal value; and
(3) For the purposes of this section the market price of ant shares already issued shall be taken to be—
(c) if less than five transfers of such shares were registered within the specified period, then such price as the auditors of the company, having regard to the financial position of the com-
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pany as disclosed to them in the accounts of the company certify to be in their opinion the fair value of the shares.
For the purposes of the foregoing provision the expression "the specified period" means a period of one month terminating three weeks before the date of the issue of the prospectus inviting subscription for the new shares, or, if there is no such prospectus, the date of the contract to take the new shares.
LORD HUNSDON OF HUNSDON LORD HUNSDON OF HUNSDON moved to omit paragraph (i) of paragraph (b). The noble Lord said: My Lords, subsection (1) (b) of Clause 32, which I propose should be omitted, prohibits the issue of shares at a discount unless the market price of the shares is at a discount. The clause permits the issue of shares at a discount where the market price is below pat, provided the issue price is not more than 50 per cent. below the nominal value. The Bill, therefore, abandons whatever principle there may be against issuing shares at a discount and it picks out the companies who are doing fairly well, whose shares stand at par or a little over, and puts them into the salute category as companies which are doing so badly that they cannot issue shares at even 50 per cent. of their nominal value. What I would like to ask is: What is there so reprehensible in having one's shares quoted at par that companies in that position are to be subjected to this disability?
The only explanation of this proviso I can think of is that the Bill has been drafted by different people—I understand that nine people have been engaged on it—and that the person who inserted this proviso thought that, if shares stood in the market at par or over, they could be issued at par or over. But the price of a share indicates the point at which sales and purchases are equal and if by means of a new issue you increase the number of shares to be sold you must also increase the number of buyers. You cannot increase the number of buyers except by giving the fresh buyers some inducement to come forward and that inducement is a discount on the market price. It is for that reason no doubt, that some other person of the nine who did know about business has inserted a clause permitting the issue of shares at 10 per cent. below the market price.
Thus, through these conflicting activities, the Bill brings us to this position. If your shares are at 99 you may issue them at 89, but if they are at par or at a slight premium you cannot issue them at all, so that the companies who are in the unfortunate position of having managed their affairs reasonably well, alone out of all the companies in the country except those which are in very low water, are forbidden to increase their capital by the issue of shares. The Lord Chancellor said at the Committee stage that the present law, forbidding the issue of shares at a discount at all, bore hardly on companies whose shares were already at a discount and therefore they were given relief. My answer is that it produced exactly the same hardships on companies whose shares were at par or a little over: and if there is any evil in issuing shares at a discount there must be a greater evil in issuing them at 89 than in issuing them at 90 or 92. If I may say so, with all deference and respect to those who may disagree with me, I think that the dictum that shares may not be issued at a discount unless they stand at a discount will, in the City at least, supersede the classical non sequitur "who drives fat oxen should himself be fat."
So much for the merits of the question. I called attention to this matter during the Committee stage and I also proposed a more important Amendment to the next clause. My reason for mentioning the next clause is that the Lord Chancellor resisted both these Amendments on the ground that the clauses which I wish to amend were recommended by the Greene Committee on whose Report this Bill is based and, therefore, so far at least as the Lord Chancellor is concerned, both my Amendments will stand or fall by my power to persuade him that the Greene Committee did not recommend them, though it is true that the Wrenbury Committee did so. In supporting his statement that the Greene Committee recommended these clauses the Lord Chancellor told Your Lordships that their Report stated that the Committee were not prepared to dissent from the findings of the Wrenbury Committee. This statement, as I said at the time, could not be considered as an enthusiastic endorsement of the Wrenbury findings, and, indeed, it does not follow
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that you assent to a proposal because you are not prepared to dissent from it, for it may be that you cannot make up your mind one way or the other.
But in fact the Report said that the Committee, as a whole, were not prepared to dissent from the Wrenbury findings, and the words "as a whole" had evidently seemed so unimportant to the Lord Chancellor that he forgot them. I submit, however, that they are very important and I think that the phrase means that the Committee were not unanimous in dissenting from those findings. That certainly is not a recommendation of the findings. I have only spoken to three members of the Committee and they all agree that the Committee did not recommend them. Mr. Harold Brown, for instance, who was a member of the Committee, writes as follows:—
"I should say that inasmuch as the Committee as a whole did not dissent from the findings of the Wrenbury Commission, the position as far as the Greene Committee was concerned was that they left the Wrenbury recommendations to stand on their own feet, and that they neither assented to nor dissented from them; in other words they could not agree about the matter one way or the other."
But if the Greene Committee did recommend them is that sufficient for your Lordships' House? The Greene Committee are not responsible for this Bill, and still less the Wrenbury Committee. Your Lordships are responsible and in your Lordships' House there are many noble Lords who have life-long practical experience of these matters.
Surely, we are to decide whether any clause in this Bill is satisfactory, not on the opinion of some outside body but on our own opinion, after hearing the arguments for or against it. I am not suggesting that this Amendment of mine is of the first importance in itself, except so far as it is important that your Lordships should not approve any clause which you are not convinced is reasonable and fair, and your Lordships may feel that. I have trespassed unduly on your time and shown undue pertinacity. My excuse is—and I think it is one which your Lordships will accept—that as I have had fifty years' experience of business I felt that this Bill might give me an opportunity of being of some assistance to your Lordships' House, and that I might help to prevent

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the passage of any clause which, in my judgment at least, would weaken the great and general respect for your Lordships' opinion. I beg to move.
Amendment moved—
Page 27, line 19, leave out lines 19 to 21.—(Lord Hunsdon of Hunsdon.)
LORD BALFOUR OF BURLEIGH: My Lords, I should like to say a word in support of the Amendment of my noble friend for which I shall vote unless I hear from the Lord Chancellor some very convincing reasons against it. I do not think, as my noble friend has said, that the quotation of the Committee's finding is convincing. We want to know the reason. It does seem to me that, the Bill departing from the principle of prohibiting shares being issued at a discount, it is difficult to justify this preservation of parity as a kind of fetish. I do not think there is any particular fetish about parity and if companies with shares at a discount are to be allowed to issue new shares I cannot see any reason why the companies described by Lord Hunsdon should not also have the same privilege. I shall wait, naturally, to hear what the Lord Chancellor has to say in defence of the clause, because your Lordships have not yet had a defence, but unless there is some convincing reason if the noble Lord goes to a Division I shall vote with him.
LORD ASKWITH: My Lords, I should also like to support my noble friend. I have been reading carefully the clause in the Wrenbury Report, and I cannot see why suddenly there should be brought in without argument these words that it should be allowed only in the case of companies whose issued share capital is at a discount. It does not seem to follow at all on the previous part of the argument, except that they have said that it ought not to be allowed at the beginning or earlier stages of a company's career. The Greene Committee almost invariably end up with a recommendation, but in this matter they do not end up with any formal recommendation at all, and it appears from the paragraph that the Committee were very divided about it. I have myself asked several important persons in the City and they cannot see a reason for it. They tell me that in many cases it might be of great advantage if a company with shares a little above par were able to induce share-
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holders, who know all the facts of the case, to subscribe more capital without waiting until the shares of the company have fallen back.
LORD GREENWAY: My Lords, I rise with much diffidence as I have only recently been admitted to your counsels, but as a business man I should like strongly to support the Amendment proposed by my noble friend Lord Hunsdon of Hunsdon. The intentions of the Bill are, of course, admirable, and they have, I am sure, the support of the whole House, but I would ask your Lordships to consider carefully whether the provisions of the particular clause to be amended are not likely to be worse than the evils which they are intended to cure. What is the proportion of the rogues who would be checked in their malpractices by these provisions in the Bill as compared with the honest investors and business men who would thereby be hampered in their operations? Certainly not one in ten thousand, probably not one in a hundred thousand. It has hitherto, I believe, been an accepted principle of justice that it is better for a number of murderers to escape punishment than that one innocent man should be hanged, but here we have a totally different principle. The framers of the Bill appear to think that ten thousand people or one hundred thousand people should be punished rather than that one rogue should escape justice. We have heard a good deal lately about the tyranny of Prohibition and local option, but what about the tyranny of the clause sought to be amended whereby the whole of the business and investing community—that is practically the whole nation—are to be prevented from carrying out a perfectly legitimate business operation in order to check a comparatively infinitesimal number of rogues from doing wrong?
THE LORD CHANCELLOR: My Lords, I hope the House does not think for a moment that I am otherwise than very grateful to those who, like Lord Hunsdon of Hunsdon and the noble Lord who has just spoken, have had experience of business and put their knowledge and experience at the disposal of this House. I have always listened throughout our discussions to what has been said and endeavoured to meet objection. I have no doubt I can satisfy noble Lords on

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this Amendment, but I did not think it would be wise to attempt to shorten discussion because I knew Lord Hunsdon of Hunsdon would like to give us his views about the Report of the Committee, not only with a view to this Amendment but others. I am afraid that on his construction of the Committee's Report I am totally unable to agree with him. The Wrenbury Committee made certain recommendations about the issue of shares at a discount on certain, conditions. It is common ground that those words which are in the clause in question were included in the Report of the Wrenbury Committee. Then came the second Committee, the Greene Committee, who set out the recommendations of the earlier Committee and said that this Committee as a whole did not dissent from the recommendations of the Wrenbury Committee.
I believe that nobody—certainly not the business men I have had to deal with—would question that this meant that the Greene Committee did not dissent from but in fact accepted the recommendations of the Wrenbury Committee. I certainly so understood it and I do not believe that anybody could, without assistance, understand it otherwise. However, let it be taken that the Greene Committee were divided and were not prepared to take a strong line either way. We still have the recommendations of the earlier Committee. It seems to me that this Amendment might fairly be accepted by the House. I believe that if the words were in they could easily be evaded, as the noble Lord has pointed out, and if they may cause injury to honest concerns I am quite prepared to accept the Amendment.
LORD HUNSDON OF HUNSDON: I am very much obliged to the noble and learned Viscount.
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, in subsection (3) (c), after the last "company," to insert "and to any other information and explanations given to them." The noble Earl said: My Lords, this Amendment is a very small one. It is merely to add the words "any other information and explanations given to them."
Amendment moved—
Page 28, line 25, after ("company") insert ("and to any other information and
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explanations given of them").—(The Earl Halsbury.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, after paragraph (c) of subsection (3), to insert:—
"Provided that if the auditors of the company are unwilling or unable for any reason to certify the fair value of the shares the directors of the company may request another public accountant or firm of public accountants to give a certificate for the purposes of this section."
The noble Earl said: My Lords, this Amendment is a rather more important one because it deals with a case not provided for in this clause. Suppose the auditors do not care to take the responsibility, what is to happen then? It might very well be that a perfectly reputable firm of auditors do not care to take a responsibility of this kind when another equally reliable firm of auditors might care to take it. It seems rather hard that because a firm of auditors happen to be taking one particular line of policy the clause should be barred because of them.
At the Committee stage I suggested that the directors of the company might do it. That, I agree, was perhaps open to objection. Now it is suggested that there should be another set of auditors appointed for the purpose of giving this certificate. It is quite clear that the company's auditors would appear as the company's auditors and if another firm than the company's auditors give the certificate it is quite clear that that firm must be of at least as good a reputation as the company's own auditors. Therefore no difficulty could arise by attempting to put up a firm of auditors distinctly not reputable in order to get through a certificate of this kind. As nothing is provided in this Bill, I beg to move this Amendment.
Amendment moved—
Page 28, line 26, at end insert the said proviso.—(The Earl of Halsbury.)
THE LORD CHANCELLOR: My Lords, perhaps I may at once say a word about this Amendment. The purpose of the clause is to fix the market price of shares. The clause provides that for this purpose yon should take the average making-up price of the shares on the Stock Exchange, if there is any. If there is none on the last three accounts, then you must take the price

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paid on the average for any such shares in respect of which transfers were registered within the specified period. If however, less than five transfers were registered in that period, you must take the price certified by the auditors of the company as being a fair price for the shares. Those are useful options. The noble Earl proposes that, if you cannot get the price through any of those methods, you may go past the company's auditors and call in somebody from outside to give you the price. It seems to me that if you cannot get the price fixed in the way proposed by the Bill, and if you cannot get the company's own auditors to say what the value of the shares is, then the company ought not to be allowed to issue those shares at a discount. This issuing at a discount is a new practice. It has been illegal hitherto and it is now proposed to legalise it. It would be going too far to allow this further option to be given. I would like to hear the views of members of the House who are daily dealing with such matters, but at present, unless they take another view, I would oppose it.
VISCOUNT BERTIE OF THAME: My Lords, the noble and learned Viscount's suggestions cover the case and I do not think this proviso is necessary.
THE EARL OF HALSBURY: My Lords, I ant thinking of the case where there are big assets such as good will and where certain firms of auditors might not care to take the risk of putting a value upon the shares. It is rather difficult to know in such cases what the value of the share might be. The Greene Committee said:—
"If the issue of shares at a discount were frankly authorised and the public notified that shares could be issued at a discount it might induce the public to realise that the nominal value of a share is no guide whatever as to its intrinsic worth, and that a share is nothing more than a token representing a certain proportion of the profits and assets of the company."
It might very well be that a firm of auditors might not care to take the risk of saying what was the market value of a certain asset. It might be that another firm might quite and properly be prepared to certify its value. They might be perfectly right in certifying it and in giving it a proper market value. At present, if the company's auditors will not do it, the matter must fall.
On Question, Amendment negatived.
Clause 33:
Amendment of s. 89 of principal Act.
33. Section eighty-nine of the principal Act shall be amended as follows:—
(a) Subsection (1) thereof shall cease to have effect so far as it authorises the payment of commission to a person in consideration of his subscribing or agreeing (otherwise than conditionally on the shares not being taken up by any other persons) to subscribe for any shares in a company, and the amount payable to a person in consideration of his agreeing to subscribe conditionally or of his procuring or agreeing to procure subscriptions, whether absolute or conditional, for any shares in a company, shall not in any case exceed an amount equal to ten per cent. of the nominal value of the shares in respect of which there is a conditional agreement to subscribe or in respect of which subscriptions are procured or agreed to be procured;
LORD HUNSDON OF HUNSDON LORD HUNSDON OF HUNSDON moved to leave out paragraph (a) and insert:—
"There shall be inserted at the end of subsection (1) of section 89 of the principal Act the words—
"(c) Not in any case in excess of ten per cent. of the nominal value of the shares; and provided that the number of shares which persons who have agreed for a commission to subscribe absolutely is disclosed in the manner provided in this subsection."
The noble Lord said: My Lords, the Amendment I now propose I moved in substance in Committee, but the noble and learned Viscount opposed it on the ground that the Greene Committee had recommended the clause which I propose to amend. We are now agreed that the Greene Committee were divided upon all these points and I therefore put forward the reasons for this Amendment on its own merits.
I propose to amend Section 89 of the principal Act by adding these words. Section 89 of the principal Act enacts that
"It shall be lawful for a company to pay a commission to any person in consideration of his subscribing or agreeing to subscribe, whether absolutely or conditionally, for any shares in the company.…"
I propose that the commission shall not in any case exceed ten per cent, of the nominal value of the shares, following therein the Bill as it now stands, but I am omitting the prohibition in the Bill against paying a commission to those who take shares absolutely or "firm" as we say in the City. On the last occasion my

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noble friend Lord Banbury objected that it was not fair to offer to the public 50,000 shares where in reality 20,000 shares had already been taken firm. I have therefore added the words
"and provided that the number of shares which persons who have agreed for a commission to subscribe absolutely is disclosed in the manner provided in this subsection."
That is to say, in the prospectus or in any documents in lieu of the prospectus. Except for the fact that it is a good thing to disclose everything in a prospectus on general principles there is not much point in this proviso because the fact that shares have been taken firm before issue is what we call in the City a "bull point" and is therefore usually mentioned in the prospectus. The important part of my Amendment is the omission of the prohibition against taking shares firm.
If the proposal in the Bill is allowed to stand it will come as a great shock to the City of London where the custom of taking shares firm is regarded as an ordinary and useful financial transaction which does no injury to anyone. Moreover, as I explained on the Committee stage, the proposal could be easily evaded by a verbal understanding—a good many of these arrangements are done verbally and not by contract at all—to allot the subscription of any particular applicant in full. In answer to that, the noble and learned Viscount said, "Let them try." That was rather startling advice from a Lord Chancellor because, as those who tried would certainly succeed, it would put law-abiding citizens at a disadvantage with those who broke the law at the suggestion of the noble and learned Viscount. Another important effect of this prohibition would be that it would place an impediment in the way of insurance companies, trust companies and other financial undertakings who are now in the habit of taking shares or debentures firm as a permanent investment. It is the permanent investor whom it is advisable to encourage in the interests of the investing public. Those who underwrite issues conditionally are the people whom this Bill prefers (as against the views of the City of London), but they are of less value than those who take shares permanently because they may sell any shares that may be allotted to them at any price, provided that their under-
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writing commission will cover their loss, with the result that the shares go down in price and the investing public whom we are trying to protect loses.
Amendment moved—
Page 28, line 34, leave out from ("follows") to the end of line 9 on page 29 and insert the said new words.—(Lord Hunsdon of Hunsdon.)
LORD BALFOUR OF BURLEIGH: My Lords, in view of the previous acceptance of the Amendment to Clause 32 I hope the Lord Chancellor will accept this Amendment dealing with those who take shares firm. As the objection to issuing shares at a discount has been removed, this should also be removed. As to evasion, it is quite obvious that this is a thing which is bound to be evaded if it is put in the Bill. What does the Lord Chancellor think of these circumstances? I suppose they would be evasion, but they certainly would not be illegal. I wonder whether he would consider what would happen where shares are taken firm without any special commission, but subsequently an agreement is entered into that, if the shares are still in the same name at the end of, say, three or six months, the commission will be paid. In that way the object is achieved and the shares are in fact taken firm and there is no commission for the firm under-writing. That is one possibility and, no doubt, there are many others. It is obvious that there will be a great many means of getting round the Bill. I hope to hear from the Lord Chancellor that this Amendment will be accepted.
THE LORD CHANCELLOR: My Lords, may I first rather protest against the suggestion of my noble friend Lord Hunsdon that when I said "let them try" I was encouraging an attempt to break the law. If I may complete my sentence, it would run: "let them try and they will find the law too strong for them." The Wrenbury Committee, when they recommended that it should be lawful to issue shares at a discount, also recommended that it should no longer be possible to pay a commission to a man who took the shares firm, because that was looked upon as a kind of discount that would come within the conditions of the Bill, and not as ordinary commission. In logic there is a great deal to be said for that view, but I recognise

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that it has been the practice in the City for a long time to pay commission to underwriters, not only those who agree to take shares if nobody else takes them, but also those who at the same time agree to take shares themselves. I know that this has been done and that business men are satisfied with the practice, and I have no desire to interfere with it.
May I, however, ask noble Lords to consider one point? I think that the prohibition might perhaps be allowed to continue in the case of an issue of shares at a discount. The Bill authorises the issue of shares at a discount subject to a maximum discount with a maximum commission. If you are going to allow a company to give not only the maximum discount provided in the Bill but also a further discount in the guise of a commission of 10 per cent., you will be going a good deal beyond the recommendations of the Wrenbury Committee. Accordingly I have put on the Paper an Amendment that might take the place of this Amendment. I propose to keep the initial words which the noble Lord, Lord Hunsdon, proposes to leave out, but to confine them to shares which are to be issued at a discount and to make a consequential Amendment at the end of the clause which would authorise paying a commission on shares being taken firm in the ordinary way. In other words, I would prevent this additional discount beyond the statutory discount, but I would no longer seek to interfere with the practice of paying commission on shares taken firm. Before the House takes a decision on that alternative suggestion, I should like to hear the views of noble Lords.
LORD GREENWAY: My Lords, I should like to say that if it is necessary or advisable to pay an underwriting commission, whether the underwriting be on firm or on conditional terms, on shares issued at par, surely it is more necessary or advisable that the underwriting commission should be paid on shares that stand at a discount and have to be issued at a discount.
LORD BALFOUR OF BURLEIGH: My Lords, it is difficult to speak with certainty on this point, but it seems to me that if the under-writing commission and the discount together could be limited to 10 per cent., this appears to meet the
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point. I do not see why this should not include both the under-writing commission and the discount, but I am not absolutely certain that I have grasped the point.
THE LORD CHANCELLOR: The effect of my Amendment would be to limit the discount, not to 10 per cent., but to 60 per cent.—the 50 per cent. maximum laid down by the Bill, and the further 10 per cent. allowed in the way of commission.
LORD BALFOUR OF BURLEIGH: That is what I meant—10 per cent. in addition to the 50 per cent.
LORD ASKWITH: My Lords, as I understand the point, it is that if the shares of a company are taken firm at the outset of its career this would be permitted, but if a company wants to obtain capital when its shares are at a discount they are not to be allowed to be taken firm, with a commission for taking them firm. I understood my noble friend Lord Greenway to suggest that in that case the company might be rather in difficulties and it would be even more important for the shares to be issued firm, if anyone would take them firm in those circumstances. It seems to me that Lord Greenway's argument is sound, and that Lord Hunsdon's Amendment will be the better one to adopt.
LORD HUNSDON OF HUNSDON: My Lords, the way that I look at it is that there should be no difference between the commission paid to any one who takes shares firm and to anyone who underwrites the shares. It does not seem to me to make any difference whether the shares are at a discount or not, and the figures of 10 per cent. and 50 per cent. apply equally.
THE LORD CHANCELLOR: I will put the noble Lord's Amendment.
On Question, Amendment agreed to.
Clause 31:
Accounts.
(6) Section one hundred and thirteen of the principal Act (which relates to the powers and duties of auditors) shall be amended as follows:—
(c) At the end of subsection (3) there shall be added the words "and if the company makes default in furnishing

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such a copy to any member who demands it and tenders to the company the amount of the proper charge therefor, the company and every director, manager, secretary or other officer of the company who knowingly and wilfully authorises or permits the default shall be liable to a fine of five pounds for every day during which the default continues."
THE EARL OF HALSBURY: My Lords, my two Amendments to this clause are drafting. I beg to move.
Amendments moved—
Page 30, line 21, after ("the") insert ("reserve fund")
Page 30, line 22, leave out ("as"), and after ("sheet") insert ("or to a reserve fund, general reserve or reserve account to be shown specifically on a subsequent balance sheet.").—(The Earl of Halsbury.)
On Question, Amendments agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, at the beginning of subsection (6) (c), to leave out "At the end of" and to insert "In subsection (3), after the word 'furnished,' there shall be inserted the words 'within seven days after he has made a request in that behalf to the company' and at the end of the said." The noble and learned Viscount said: My Lords, the subsection here dealt with amends the provision in Section 113 of the Act of 1908 relating to the supply of copies of balance sheets to members of companies by imposing a penalty for noncompliance. In the subsection as it stands, there is no time limit within which the requirement must be performed, and the Amendment is suggested to remedy this defect.
Amendment moved—
Page 31, line 9, leave out ("At the end of") and insert the said new words.—(The Lord chancellor.)
On Question, Amendment agreed to.
Clause 35:
Form of balance sheet.
(2) There shall be stated under separate headings in the balance sheet—
(b) if it is shown as a separate item in or is otherwise ascertainable from the books or papers of the company, the present amount of the goodwill as so shown or ascertained.
(4) Where the assets of a company include shares in a subsidiary company or
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any indebtedness of a subsidiary company by loans or otherwise the aggregate amount of these assets (distinguishing shares ant indebtedness) shall be set out in the balance sheet of such company separately from all its other assets. Where the liabilities of a company include any indebtedness to a subsidiary company (through loans or otherwise) such indebtedness shall be set out in the balance sheet of such company separately from all its other liabilities.
(5) Where a company (in this subsection referred to as "the holding company") holds shares in a subsidiary company or in two or more subsidiary companies, there shall be annexed to and filed with the balance sheet of the holding company a statement, signed by the persons by whom in pursuance of Section one hundred and thirteen of the principal Act the balance sheet is signed, stating how the profits and losses of the subsidiary company, or, where there are two or more subsidiary companies, the aggregate profits and losses of those companies, have been dealt with in, or for the purposes of, the accounts of the holding company and in particular how, and to what extent,—

(i) provision has been made for the losses of any subsidiary company either in the accounts of that company or of the holding company, or of both; and

(ii) losses of any subsidiary company have been taken into account by the directors of the holding company in arriving at the profits and losses of that company as disclosed in its accounts.

For the purposes of this subsection the profits of a subsidiary company mean the profits made during the period to which the accounts of the holding company relate or shown in any accounts of the subsidiary company made out in that period, and the losses of a subsidiary company means losses incurred during that period or shown in any such accounts.
If for any reason the directors of the holding company are unable to obtain such information as is necessary for the preparation of the statement aforesaid, they shall so certify in writing and their certificate shall be annexed to and filed with the balance sheet in lieu of the statement.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, in subsection (2) (b), after "if," to insert, in the case of a company registered on or after the first day of April, nineteen hundred and nine." The noble Earl said: My Lords, this Amendment deals with the form of balance sheet. In subsection (2) it is stated that there shall be shown:—

"(a) the preliminary expenses of the company so far as not written off; and

(b) if it is shown as a separate item or is otherwise ascertainable from the books or papers of the company the present amount of the good will."

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The auditors have a great difficulty in this matter, and I think in Committee the noble Viscount suggested that "papers" was a rather wide expression. My two Amendments, this and the one which follows, are really in the alternative. If in fact you do not have to go into every paper without limit at all, the auditors in preparing the balance sheet would not object to it, and the first Amendment which I am moving is that it should only be the goodwill of a company registered on or after the 1st day of April, 1909. That would give a time limit on which they could work, and they would not have to go back beyond the year 1909. If on the other hand, that is not acceptable, my alternative Amendment is to leave out the word "papers" and insert "in any contract of sale or agreement." I feel difficulty in moving my first Amendment until I have some indication of the view of the noble Viscount.
Amendment moved—
Page 32, line 5, after ("if") insert ("in the case of a company registered on or after the first day of April nineteen hundred and nine").—(The Earl of Halsbury.)
THE LORD CHANCELLOR: I would first say on the form of the Amendment that I would ask the noble Earl to move to leave out "if it."
LORD KYLSANT: My Lords, I suggest that it is a very great advantage to the public that the good will should be stated in the balance sheet, and to simply say that it shall not be stated in a balance sheet if the company was registered before 1909 is liable to result in its not being shown in the case of companies that have very excessive good will. I believe that it would be a decided advantage to the general public to have the good will shown, and if an alteration is to be made in the law it should not be limited to companies registered after 1908, but apply to all companies. I suggest that whatever clause is agreed upon it should apply to every company.
LORD DANESFORT: My Lords, I do not gather from the speech of the noble Earl quite what the object of his Amendment is. If it is desirable in the case of a limited company registered after April, 1909, that the good will should
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be shown, surely, as Lord Kylsant has said, it is desirable to show it, also in the balance sheet of older companies.
THE LORD CHANCELLOR: My Lords, I was told that the trouble was that if you force an old company to go back into all its past papers, in order to see whether somewhere there is a valuation for good will, you would be putting too heavy a burden upon such a company, and therefore it is proposed to limit the paragraph (b) to companies which have been in operation since 1908. I have taken notice, however, of what Lord Kylsant has said, and perhaps the noble Earl would not mind withdrawing this Amendment and not moving his alternative Amendment, and then we can try to find a suitable form of words before the Third Reading.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to leave out all words is subsection (4) after "Where," except the concluding words "indebtedness shall be set out in the balance sheet of such company separate from all its other liabilities," and insert "any of the asset of a company consist of shares in, or amounts due (whether on account of any loan or otherwise) from subsidiary companies, the aggregate amount of those assets, distinguishing shares and indebted ness, shall be set out in the balance sheet of the first-mentioned company separately from all its other assets, and where a company is indebted (whether on account of any loan or otherwise) to subsidiary companies, the aggregate amount of that". The noble and learned Viscount said: My Lords, this is a purely drafting Amendment.
Amendment moved—
Page 32, line 15, leave out from ("where") to ("indebtedness") in line 23 and insert the said new words.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Amendment moved—
Page 32, line 28, leave out ("and filed with").—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (5), after "have", ["have been dealt with"], to insert "so far as they concern the holding company." The noble and learned Viscount said: My Lords, it was felt that the words as they

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stand in the Bill imposed rather too heavy a burden on the company, and it is therefore proposed that they shall only apply to the proportionate part of those profits and losses with which the holding company is concerned.
Amendment moved—.
Page 32, line 35, after ("have") insert ("(so far as they concern the holding company)").—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, after paragraph (ii) in subsection (5), to insert:—
"Provided that it shall not be necessary to specify in any such statement the actual amount of the profits or losses of any subsidiary company, or the actual amount of any part of any such profits or losses which has been dealt with in any particular manner."
The noble Earl said: My Lords, the object of this and subsequent Amendments is to deal with a point raised on the Committee stage, and it is really a question of how the subsidiary companies accounts must be divided up.
Amendment moved—
Page 33, line 5, at end, insert the said proviso.—(The Earl of Halsbury.)
THE LORD CHANCELLOR: My Lords, subject to what noble Lords may wish to say, I am prepared to accept this and the two following Amendments standing in the name of the noble Earl.
On Question, Amendment agreed to.
Amendments moved—
Page 33, line 6, leave out from ("profits") to end of line 12, and insert ("or losses of a subsidiary company mean the profits or losses shown in any accounts of the subsidiary company made up to a date within the period to which the accounts of the holding company relate, or, if there are no such accounts of the subsidiary company available at the time when the accounts of the holding company are made up, the profits or losses shown in the last previous accounts of the subsidiary company which became available within that period")
Page 33, line 16, leave out ("they") and insert ("the directors who sign the balance sheet"), and leave out ("certify") and insert ("report"), and leave out ("certificate") and insert ("report").—(The Earl of Halsbury.)
On Question, Amendments agreed to.
THE LORD CHANCELLOR: My Lords, the next is a drafting Amendment.
Amendment moved—
Page 33, line 17, leave out ("and filed with").—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to add to the clause:—
"Where a company the ordinary business of which includes the lending of money holds shares in another company as security only, no account shall for the purpose of determining under this subsection whether that other company is a subsidiary company be taken of the shares so held."
The noble and learned Viscount said: My Lords, this Amendment would exempt from some of the obligations of the clause a company the ordinary business of which includes the lending of money. This limited provision is sufficient to protect banks and insurance companies: the Amendment is inserted in order to meet a point raised by the British Bankers' Association.
Amendment moved—
Page 33, line 38, at end insert the said words.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 36 [Rights of members and debenture holders to receive copies of balance sheets and reports of directors and auditors]:
THE LORD CHANCELLOR: My Lords, the effect of the Amendment I move to this clause is that where a company receives a demand for a copy of its balance sheet it shall comply with the demand within seven days instead of fourteen.
Amendment moved—
Page 34, line 9, leave out ("fourteen") and insert ("seven").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 38 [Amendments as to registration of mortgages and charges]:
THE LORD CHANCELLOR: My Lords, the next three are drafting Amendments.
Amendments moved—
Page 36, line 7, after ("company") insert ("registered in England")
Page 37, line 10, after ("before") insert ("the date of")
Page 37, line 11, after ("Act,") insert ("and remaining unsatisfied at that date").—(The Lord Chancellor.)
On Question, Amendments agreed to.
Clause 40 [Provisions as to receivers and managers]:
THE LORD CHANCELLOR: My Lords, there are two more drafting Amendments.
Amendments moved—
Page 38, lines 31 and 32, leave out ("the balance, if any, of the receipts")
Page 38, line 32, after ("liquidator") insert ("the amount properly payable to him").—(The Lord Chancellor.)
On Question, Amendments agreed to.
Clause 42 [Amendment of s. 104 of principal Act]:
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to insert as a new subsection:
"(3) Where any debentures which have been redeemed before the elate of the commencement of this Act are re-issued subsequently to that date, the re-issue of the debentures shall not prejudice any right or priority which any person would, if this section had not passed, have had under or by virtue of any mortgage or charge created between the dote of the redemption of the debentures and the date of the commencement of this Act."
The noble and learned Viscount said: My Lords, the effect of this Amendment is to prevent the provision of Clause 42 from having a retrospective effect to the prejudice of mortgages created before the new Act comes into force. The Amendment meets a point raised by the Bankers' Association.
Amendment moved—
Page 40, line 6, at end insert the said new subsection.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 44 [Amendment as to service of process]:
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to insert as a new subsection:—
"Where process is served on a company under this section, the person issuing out the process shall send a copy thereof by post to the registered office of the company."
The noble and learned Viscount said: My Lords, this Amendment is to meet the views of the Scottish lawyers, who have their own views about this matter.
Amendment moved—
Page 42, line 17, at end insert the said new subsection.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 45 [Power to acquire shares of shareholders dissenting from scheme or contract approved by majority]:
THE EARL OF HALSBURY: My Lords, this Amendment is merely an extension of fourteen days to one month, as fourteen days is thought to be rather short.
Amendment moved—
Page 42, line 33, leave out ("fourteen days") and insert ("one month").—(The Earl of Halsbury.)
On Question, Amendment agreed to.
Clause 49 [Provisions for facilitating reconstruction and amalgamation of companies]:
THE LORD CHANCELLOR: My Lords,, this is a drafting Amendment.
Amendment moved—
Page 45, line 20, after ("reconstruction") insert ("of any company or companies").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 61:
Amendment as to voluntary winding-up in certain, cases.
61—(1) The following provisions of this section shall have effect in relation to every voluntary winding-up, unless at a meeting of the directors of the company held before the date on which the notices of the meeting at which the resolution for the winding-up of the company is to be proposed are sent out, the directors, or, in the case of a company having more than two directors, at least two of the directors of the company, have made a statutory declaration to the effect that they have made a full inquiry into the affairs of the company, and that having so done they have formed the opinion that the company will be able to pay its debts in full within a period not exceeding six months from the commencement of the liquidation, and unless before the said date the declaration so made has been filed with the registrar of companies.
(6) The creditors at the meeting to be held as aforesaid or at any subsequent meeting, may, if they think fit, appoint a committee of inspection, and if such a committee is appointed the company may, either at the meeting at which the resolution for Winding-up the company is passed or at any time subsequently in general meeting, appoint such number of persons as they think fit to act as members of the committee not exceeding five in number:
VISCOUNT BERTIE OF THAME VISCOUNT BERTIE OF THAME moved, in subsection (1), to substitute "twelve months" for "six months." The noble Viscount said: My Lords, I have been asked by my noble friend Lord Danes-fort, who has had to go to an important political meeting, to move this Amendment in his name. The Society of In-

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corporated Accountants and Auditors, who are an important body, requested him to bring it forward. The reasons of the Amendment are these. The declaration required to be made by the directors under this clause is an onerous responsibility. In practice directors as a matter of business will find great difficulty in making a statutory declaration that "the company will be able to pay the debts in full" within six months. Having regard to the heavy penalties in the Bill to which directors will be subject it is unreasonable to expect them to take undue risks in making this declaration. The position, however, might be eased if the expression of opinion required could be based upon a period of twelve months, instead of six, because the longer period would give more time for an advantageous realisation of assets.
Amendment moved—
Page 51, line 26, leave out ("six") and insert ("twelve").—(Viscount Bertie of Thame.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (6), after the first "inspection," to insert "consisting of not more than five persons." The noble and learned Viscount said: My Lords, under the clause as it stands the creditors can appoint any number of persons to serve on the committee of inspection, and the company can only appoint five. This Amendment limits the number of members of the committee of inspection appointed by the creditors to five.
Amendment moved—
Page 52, line 33, after ("inspection") insert ("consisting of not more than five persons").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 68:
Liability where proper accounts not kept.
(2) For the purposes of this section, proper books of account shall be deemed not to have been kept in the case of any company if there have not been kept such books or accounts as are necessary to exhibit and explain the transactions and financial position of the trade or business of the company, including books containing entries from day to day in sufficient detail of all cash received and cash paid, and, where the trade or business has involved dealings in goods, statements of the annual stocktakings and (except in the case of goods sold by way of retail trade to the actual consumer) of
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all goods sold and purchased, showing the goods and the buyers and sellers thereof in sufficient detail to enable those goods and those buyers and sellers to be identified.
LORD HUNSDON OF HUNSDON LORD HUNSDON OF HUNSDON moved, in subsection (2), before "retail trade," to insert "ordinary," and to leave out "to the actual consumer." The noble Lord said: My Lords, this clause lays it down that books have not been properly kept unless they are in sufficient detail to identify all the buyers of goods, except in the case of goods sold by way of retail trade to the actual consumer. I would therefore point out that the retail trader often sells for cash across the counter, and does not necessarily know to whom he is selling, or whether the purchaser is an actual consumer. Therefore I propose that the subsection should read "except in the case of goods sold by way of ordinary retail trade."
Amendment moved—
Page 63, line 26, after the first. ("of") insert ("ordinary"), and leave out ("to the actual consumer").—Lord Hunsdon of Hunsdon.)
On Question, Amendment agreed to.
Clause 71:
Prosecution of delinquent directors.
(5) The Board of Trade, with the consent of the Treasury, may direct that the whole or any part of any costs and expenses properly incurred by the liquidator in proceedings duly brought by him under this section shall be defrayed as expenses incurred by the Board under the principal Act in relation to the winding-up of companies ill England, and subsection (3) of Section thirteen of the Economy (Miscellaneous Provisions) Act, 1926, shall apply accordingly.
Subject to any direction under this subsection and to any mortgages or charges on the assets of the company all such costs and expenses as aforesaid shall be payable out of those assets in priority to all other liabilities payable thereout.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in the last paragraph, after "company," to insert "and any debts to which priority is given by Section two hundred and nine of the principal Act." The noble and learned Viscount said: My Lords, this clause proposes to charge the costs of proceedings by the liquidator on the assets, subject to certain prior charges, but that should also be made subject to these preferential debts. It is the practice of liquidators and receivers to pay these preferential debts for wages,

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salaries, and so on, as soon as possible after they are appointed. As the Bill stands, they might hesitate to make those payments because they would not know whether a prosecution would be instituted, and the costs of any prosecution would have priority over such payments. It is thought better to say expressly that these preferential payments retain their priority.
Amendment moved—
Page 68, line 19, after ("company") insert the said words.—(The Lord Chanceller.)
On Question, Amendment agreed to.
LORD HUNSDON OF HUNSDON LORD HUNSDON OF HUNSDON moved, to insert the following new subsection:
"(6) Nothing in this Act shall oblige any solicitor to supply any information the giving of which would involve a breach of professional privilege."
The noble Lord said: My Lords, I brought this Amendment forward on the Committee stage and the noble and learned Viscount was sympathetic, but he wished to have time to consider it and asked me to bring it forward again. According to the clause every agent is to give assistance to the prosecution which he is reasonably able to give, and "agents" are defined as bankers and others and solicitors. Members of the Law Society are alarmed at this because they thought it was altering the existing custom. The only thing I have to say is that in the Amendment the word "professional" is only put there in order to explain the nature of the privilege, because the privilege is not really to the profession but to the clients of the profession. It is the clients of the profession that the Law Society seeks to protect. I beg to move.
Amendment moved—
Page 6S, line 21, at end insert the said new subsection.—(Lord Hunsdon of Hunsdon.)
VISCOUNT BERTIE OF THAME: My Lords, if this Amendment is inserted it will induce any fraudulently disposed director or other officer to employ the same solicitor as the one employed by the company. This Amendment, I think, is quite unnecessary as it is open to any director or other officer to employ a solicitor other than the company's solicitor, and I ask your Lordships not to accept the Amendment.
THE EARL OF HALSBURY: My Lords, if this solicitor had certain information because he is the solicitor of the company, that is one thing, but if he has the information because he is solicitor to a director that is a totally different thing. It does not seem to me that a director would get himself into a better position by employing the company's solicitor.
THE LORD CHANCELLOR: My Lords, this question of privilege is a very difficult matter. There has been a good deal of difficulty as to how far it extends in such proceedings as we are contemplating here. It is, as the noble Lord has said, a privilege not of the solicitor but of the client. It is the client only who would be affected. It is quite true, as Lord Bertie has said, that if this Amendment is carried in these words difficulty would arise where the person charged had employed the solicitor who was also the solicitor of the company. The solicitor is not bound to tell the Court anything about the company's affairs which he may have learned while acting for the company. It would, of course, be undesirable that he should do that.
I am disposed to think, if your Lordships are willing to accept the principle, that the Amendment might run in a different form. Let me point out that this question arises not only on the clause which we are discussing but also on a similar provision in Clause 43, and if the proviso is put in it ought to apply to both clauses. It is suggested to me that it might run in this form:—
"Where proceedings are instituted under this Act against any person by the Director of Public Prosecutions, nothing in this Act shall be taken to require any person who has acted as solicitor for the defendant to disclose any privileged communication made to him in that capacity."
That would, to some extent, meet the point made by the noble Viscount, and if he sees no objection I would suggest that this Amendment be withdrawn and that a new clause in the form that I have indicated be put down for Third Reading.
VISCOUNT BERTIE OF THAME: My Lords, I am rather against directors or companies' officers employing the same solicitor as the company. If you get tricky directors and tricky solicitors together you cannot tell what they might not do.
LORD HUNSDON OF HUNSDON: I accept the solution offered by the noble and learned Viscount.
Amendment, by leave, withdrawn.
Clause 72:
Provisions as to liability of directors, &c.
72.—(1) Subject as hereinafter provided, ally provision, whether contained in the articles of a company or in any contract with a company or otherwise, for exempting any director, manager or other officer of the company from, or indemnifying him against, any liability which by virtue of any rule or law would otherwise attach to him in respect of any negligence, default, breach of duty or breach of trust of which he may be guilty in relation to the company shall be void:
Provided that—
(c) notwithstanding anything in this subsection, a company may, in pursuance of any such provision as aforesaid, indemnify any director, manager or other officer of the company against any liability incurred by him in defending any proceedings, whether civil or criminal, in which judgment is given in his favour or in which he is acquitted or in connection with any application under Section two hundred and seventy-nine of the principal Act in which relief is granted to him by the Court.
(2) Section two hundred and seventy-nine of the principal Act shall apply to the managers and officers of a company as it applies to the directors of a company, and the Court in determining in pursuance of that section whether any person ought fairly to be excused for any negligence or breach of trust shall take into consideration all the circumstances connected with his appointment, including the purpose thereof and shall have effect as though for the words "negligence or breach of trust" there were substituted the words "negligence, default, breach of duty or breach of trust."
LORD ASKWITH LORD ASKWITH moved, before "guilty" in subsection (1) in the line immediately preceding the provisos, to insert "knowingly." The noble Lord said: My Lords, I have been asked by Lord Gainford, in his unavoidable absence, to move this Amendment and the other Amendments that he has put down to Clauses 72 and 74. These clauses are of very great importance to directors generally because they make a very complete alteration in the existing law and practice. At the present moment it is the general custom of a company to give an indemnity to a director if he has been guilty of negligence or default, and there have been very few cases indeed before the Law Courts. The clauses seem to be directed to meet what occurred in a very well known case which created such
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a sensation and perhaps caused the bringing in of this Bill. The subsection provides that the indemnity cannot be given and my noble friend suggests that whether the man is guilty or not he must be brought up and tried. Unless considerable mitigation is given to the provisions of the Bill by means of the Amendments of Lord Gainford and Lord Hunsdon of Hunsdon the director would be subjected to these proceedings, however innocent he might be. It would be a protection to him if the word "knowingly" were inserted.
If he has "knowingly" been guilty of negligence or default or breach of duty or trust, then it would be right that he should be subjected to a trial, but there should be this proviso that he should have done it "knowingly." The words "wilfully" and "knowing" are inserted in all cases of this kind of default or negligence mentioned in this Bill. For confirmation of this I would refer your Lordships to Clauses 8, 10, 13, 14, 16, 17 and others. It is in this clause for the first time that we find the omission of those words. I am aware that in paragraph 46 of the Report there is a very strong reference to directors. It says:—
"A director may with impunity be guilty of the grossest negligence provided that he does not consciously do anything which he recognises to be improper."
Apparently, under the provisions of this particular clause, he is given six months in which to study the law. The majority of men who become directors are business men or experts, and even if they try to do so they would find the greatest difficulty in learning fully the law relating to companies. There may be a few persons who become directors who would not take any trouble about it and it may be the case that perhaps some of them ought to be hit. In the majority of cases, however, it would be a very serious matter. In bad cases it would be found, I think, when the question came to be investigated, that offenders were guilty in other respects and they would be hit. But the provision that they cannot be indemnified at all raises a quite different legal question to that which has existed in the past and I would submit that insufficient latitude is given in the case of a technical inadvertent breach of the Company Law of which a director may be guilty.
Amendment moved—
Page 68, line 30, after the first ("be") insert ("knowingly").—(Lord Askwith.)
LORD HUNSDON OF HUNSDON: My Lords, I hope the Government will accept this Amendment. As my noble friend says, this is the only place where "knowingly" and "wilfully" do not appear. Though I have not the least idea or what these words mean they do seem the only bright spot in a Bill full of masses of punishments, liabilities and offences. If we are all supposed to know the law then if we break the law we must do it knowingly and wilfully. Still, I should like to see the words inserted because they are some protection.
THE LORD CHANCELLOR: My Lords, I am afraid that if your Lordships accept this Amendment you will be totally destroying the value of this clause. It is an important clause, I agree, and it wants careful consideration, but the recommendation which the House, I think, accepted in Committee was that a provision in the articles that a director should be exempt from any liability for any negligence or default or breach of duty should be void—that the liability should be the ordinary liability of an agent who commits a default or a breach of his duty—but that if for special reasons the Court thought that a director ought to be excused then the Court might excuse him. I fully accept the latter part of the recommendation, and I am prepared when the time comes to accept some of the proposals which are on the Paper in order to extend the power of the Court in a proper case to excuse a director who has been negligent. It seems to me, however, to be going much too far to say that this clause shall not apply to negligence or breach of duty unless it is wilful and is done knowingly. I do not know what wilful negligence is. Negligence is omission to do something which a man ought to have done. Generally it occurs from want of thought or want of care, and I cannot imagine a man saying to himself: "I know all about my duties, but I will be negligent about them." It seems to me that to put in these words would destroy the whole effect and meaning of this clause and I would rather not have the clause at all than have these words inserted. They would create the greatest difficulties and I think any real danger would be met by later Amendments. I hope therefore the noble Lord will not press the Amendment.
LORD ASKWITH: In view of the noble and learned Viscount's promise that he will consider very carefully what would happen in the event of a man being obliged to be convicted for what may amount to a very small offence——
THE LORD CHANCELLOR: May I interrupt? Not convicted, but civilly liable.
LORD ASKWITH: —I will not press the Amendment.
Amendment, by leave, withdrawn.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in sub-section (1) proviso (c), after "Act" to insert "or under this section". The noble and learned Viscount said: If your Lordships are not prepared to accept, later Amendments which would give authority to a director who thinks he has been negligent to apply himself to the Court for relief, you will delete these words.
Amendment moved—
Page 69, line 9, after ("Act") insert ("or under this section").—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (2), to leave out "connected with his appointment including the purpose thereof" and to insert "of the case, including those connected with his appointment." The noble Viscount said: My Lords, this Amendment also relates to the question of the liability of directors. The proposal in the Bill is to make Section 279 of the principal Act apply to the managers and officers of a company as it applies to the directors, and the Court, in determining in pursuance of that section whether any person ought fairly to be excused for any negligence or breach of trust, may take into consideration all the circumstances connected with his appointment, including the purpose thereof. It has been represented to us that this does not go quite far enough. It directs the attention of the Court to the circumstances connected with the appointment and so may lead the Court not to pay sufficient attention to other circumstances.
The Report of the Greene Committee, I find, contains these words:—
"On the other hand it has been forcibly brought to our notice that under the modern conditions of company administration it is in many cases quite impossible for every director to have an intimate knowledge of or to exercise more than a quite general

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supervision over the company's business. Moreover, it often happens that a director is appointed owing to some special knowledge of a particular branch or aspect of the company's affairs or because he is in a position to obtain business for the company. It is not to be expected that such a director should be bound to have so close an acquaintance with the general business of the company as other members of the board. We are of opinion that the general law of negligence is sufficient to deal with such a case but in order to remove any possible hardship we recommend that the Court in exercising its power to grant relief should give attention to considerations of the nature indicated."
I am very unwilling to cause any suspicion in the minds of business men that their case will not be fully and fairly considered with a view to ascertaining whether or not they should be excused. Therefore I propose, if your Lordships agree, to amend that clause by instructing the Court to have regard to all the circumstances of the case, which will, I think, improve the security of the directors.
Amendment moved—
Page 69, lines 17 and 18, leave out ("connected with his appointment including the purpose thereof") and insert ("of the case, including those connected with his appointment").—(The Lord Chancellor.)
On Question, Amendment agreed to.
LORD ASKWITH LORD ASKWITH moved to insert the following new subsection:—
"(3) Whenever in any proceedings pending before a Judge and jury against any person claiming relief in respect of any negligence, default, breach of duty or breach of trust, of which such person has been or is alleged to have been guilty as director, manager or officer of any company the Judge, after hearing the evidence tendered by or on behalf of such person, shall be of opinion that such person ought fairly to be excused from the negligence, default, breach of duty or breach of trust or alleged negligence, default, breach of duty or breach of trust the Court may on the application of such person withdraw the case from the jury and direct judgment to be entered for such person on such terms as to payment of costs or otherwise as the Judge may think proper."
The noble Lord said: My Lords, I beg to move this Amendment on behalf of my noble friend Lord Gainford. I prefer it to that of my noble friend Lord Hunsdon which is also on the Paper. This Amendment extends the power of the Judge and enables him, before an actual finding by the jury, to withdraw the case from the jury instead of having to wait until a finding has been given
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and then perhaps relieve the applicant. In view of all the new kinds of negligence brought in by this Bill, it seems to me important that this dispensing power should be given. The reason that Lord Hunsdon's Amendment does not go as far as mine is that it does not appear from the Companies Consolidation Act that the Court can dismiss a case and relieve the director except after a finding of the jury or of the Court. This Amendment will enable that to be done at any time without having to wait for the finding in perhaps a very small case against a comparatively innocent director.
Amendment moved—
Page 69, line 21 at end insert the said new subsection.—(Lord Askwith.)
LORD HUNSDON OF HUNSDON: My Lords, I rather disagree with my noble friend Lord Askwith in his criticism of the Amendment that stands in the name of my noble friend Lord Halsbury and myself. It does not conflict at all with his Amendment. It deals with a different condition. What Lord Askwith's Amendment seems to do is to deal in a more moderate way with that part of the Amendment to Clause 32 which my noble friend Lord Halsbury and I moved on the Committee stage. It does, though not to such an extent as we suggested, tend to make the honest director a little more comfortable in his mind. While we desire to stop malpractices, we must take care not to check honest people from joining the boards of companies lest in the end the gain may be less than the loss.
THE LORD CHANCELLOR: I agree that the two Amendments are independent of one another.
LORD ASKWITH: I would be very pleased if both were accepted.
THE LORD CHANCELLOR: I accept the principle of this Amendment. The drafting of it, however, is not approved and if the noble Lord would accept this Amendment in place of it I should be obliged:—
"Where any case to which the said Section two hundred and seventy-nine applies is being tried by a Judge with a jury, the Judge, after hearing the evidence, may, if he is satisfied that the defendant ought in pursuance of the said section to be relieved either in whole or in part from the liability sought to be enforced against him,

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withdraw the case in whole or in part from the jury and forthwith direct judgment to be entered for the defendant on such terms as to costs or otherwise as the Judge may think proper."
It certainly covers the whole ground.
LORD ASKWITH: It is, if I may say so, a great improvement on the drafting of the clause given to me and it meets the point that the Judge may be able to withdraw the case before the finding of the Court.
Amendment, by leave, withdrawn.
Amendment moved—
Page 69, line 21, at end insert the said new subsection.—(The Lord Chancellor.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, at the end of the clause, to insert the following new subsection:—
"(3) Where any person being a director, manager or officer of a company has reason to apprehend that any claim will or might be made against him in respect of any negligence, default, breach of duty or breach of trust, he may apply to the Court for relief, and the Court on any such application shall have the same power to relieve him as under Section two hundred and seventy-nine of the principal Act it would have had if it had been a Court before which proceedings against that person for negligence, default, breach of duty or breach of trust had been brought."
The noble Earl said: My Lords, this is an Amendment in a much milder form than the one which Lord Hunsdon and myself moved on Committee Stage. We have undoubtedly proposed a much milder subsection for the relief of directors on this occasion.
Amendment moved—
Page 69, line 21, at end insert the said new subsection.—(The Earl of Halsbury.)
THE LORD CHANCELLOR: My Lords, the effect of this Amendment is that if a director or an officer of a company thinks a case might be made against him for negligence, default, breach of duty or breach of trust, he need not wait until he is sued but may himself, having a guilty conscience, apply to the Court for relief and the Court may give him relief. I doubt whether that power would be very much used, but I see no objection to it.
On Question, Amendment agreed to.
Accounts to contain particulars as to loans to directors, &c.
73.—(1) The accounts which in pursuance of this Act are annually to be laid before
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every company in general meeting shall contain particulars showing—

(a) the aggregate amount of any loans which during the period to which the accounts relate have been made either by the company or by any other person under a guarantee from or on a security provided by the company to the directors of the company, and to any other officers of the company respectively, including any such loans which were repaid during the said period; and

(b) the aggregate amount of any loans made to directors and to such other officers respectively at any time before the period aforesaid and outstanding at the expiration thereof:

THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (1) (a), to leave out "aggregate." The noble and learned Viscount said: My Lords, I have a series of Amendments to Clause 73. The effect of these Amendments taken together is that, whereas Clause 73 as it stands requires a company's accounts to contain particulars as to the aggregate amount of loans to directors and to other officers of the company respectively, the clause when amended will require such particulars to be given in detail showing the amount lent to each director or officer individually. I have sympathy with the objection taken on the Committee stage that the statement that an aggregate sum of £10,000 had been lent to the directors or officers would not tell the shareholders very much and that it would be right to give the details. The effect of these Amendments is to require those details to be given.
Amendment moved—
Page 69, line 25, leave out ("aggregate").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Amendments moved—
Page 69, lines 29 and 30, leave out ("the directors") and insert. ("any director or officer")
Page 69, line 30, leave out from ("company") to ("including") in line 31.
Page 69, line 34, leave out ("aggregate").
Page 69, lines 34 and 35, leave out from ("made") to end of line 35, and insert ("in manner aforesaid to any director or officer").—(The Lord Chancellor.)
On Question, Amendments agreed to.
Clause 74:
Statement as to remuneration of directors to be furnished to shareholders.
74.—(1) The directors of a company shall, on a demand in that behalf made to them

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in writing by members of the company representing at the date of the demand not less than one quarter of the total voting rights of all the members of the company, furnish to all the members of the company within a period of one month from the date of the demand a statement, certified as correct, or with such qualifications as may be necessary, by the auditors of the company, showing as respects each of the last three preceding years in respect of which the accounts of the company have been made up the aggregate amount received in that year by way of remuneration or other emoluments by persons being directors of the company, whether as such directors or otherwise in connection with the management of the affairs of the company, and there shall in respect of a person being by virtue of the nomination, whether direct or indirect, of the company a director of any other company be included in the said aggregate amount any remuneration or other emoluments received by him for his own use as a director of that other company.
(2) In computing for the purpose of this section the amount of any remuneration or emoluments received by any director the amount actually received by him shall, if the company has paid on his behalf any sum chargeable by way of income tax (including super-tax) in respect of the remuneration or emoluments, be increased by the amount of the sum so paid.
(3) If any director fails to comply with the requirements of this section he shall be liable to a fine of fifty pounds.
LORD ASKWITH LORD ASKWITH moved, in subsection (1), to omit the words "on a demand in that behalf made to them in writing by members of the company representing at the date of the demand not less than one quarter of the total voting rights of all the members of the company." and insert "if required by a special resolution of the company so to do." The noble Lord said: My Lords, I beg to move this Amendment which stands in the name of my noble friend Lord Gainford. The Committee's Report declares that the question of the disclosure of the remuneration of directors is a difficult one, and they make certain recommendations. The Bill that is before us says:
"The directors of a company shall, on a demand in that behalf made to them in writing by members of the company representing at the date of the demand not less than one quarter of the total voting rights of all the members of the company, furnish to all the members of the company within a period of one month from the date of the demand a statement, certified as correct, or with such qualifications as may be necessary, by the auditors of the company, showing as respects each of the last three pre-
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ceding years in respect of which the accounts of the company have been made up the aggregate amount received in that year by way of remuneration or other emoluments by persons being directors of the company, whether as such directors or otherwise in connection with the management of the affairs of the company,"
and so on.
I submit that a special resolution of a company is far the best way of dealing with this difficult question. If members of a company really want it, they can easily obtain an opportunity for discussion of this subject, and then the company in a general meeting can discuss whether the remuneration is fair or not. But if you were to allow for an unspecified period—and it might go on for years—such a small number of persons to issue a fiat that the directors must provide this statement, however much they may disagree with the proposal, you create a very unfair position for many people. You may be doing a thing which the board of directors have had no opportunity whatever of putting before the general meeting, you may be compelling them to disclose particulars which a general meeting would refuse to give and you are actually,, by a minority, binding a company by Statute to a disclosure that may be quite contrary to the view of the majority.
I am urged to press this Amendment very strongly. The clause, as it stands, might easily lead to the overthrow of a majority decision. Men who were managers of the company and who were invited to add to that managership a directorship—which is very often a very valuable arrangement for a company—would, as a result of this provision, be very loth to become directors of the company lest they should be obliged to have a disclosure, of a kind which is frequently refused, of all the amounts they have received by resolution of the board. This expert type of managing director is frequently a man who is called in when the company is not doing very well and his brains are required. He may be paid a fixed salary, or be paid by results, according to what he achieves. The company may then prosper, and a request may be made by persons jealous of these managing directors with a view to finding out how much they are receiving, and it will be said that they are receiving, or have received, an unfair

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amount, though they may have brought the company to a period of prosperity after its lean years.
The Greene Committee itself alludes to the fact that it is often inadvisable to disclose these matters, because people can act on behalf of rival companies and competitors. Most people will know of certain instances in which this has been done in order to obtain the services of these men by endeavouring to offer them a bigger sum than they are receiving. This procedure might be used to buy up a manager, and, although the aggregate remuneration is that which has to be shown according to this Bill, yet it would be perfectly easy to find out what remuneration an expert manager is getting. The fees for ordinary directors are generally laid out in the articles of association or have been passed by special resolution of the company, and if these are withdrawn from the total it can be ascertained with the greatest case what is being received by the experts. A special resolution has to be demanded by a majority of three-quarters of those present in person or by proxy, and not by a majority of those persons who are members of the company and entitled to vote. If the company agrees that the matter should be disclosed, let it be disclosed, and a general meeting can be held to discuss the matter upon the resolution of only one-tenth of the persons present in person or by proxy.
There is another point in regard to this disclosure of remuneration that is not without some importance. Very often it has come out—I have known instances of this myself—that some man who has really been keeping the company going by his brains has received a very considerable amount, and that amount is used for comparison with the wages of clerks and other employees, even of workmen, for the purpose of making trouble. Surely the board, who are the responsible persons and a committee of whom have appointed the expert, are the people to decide how much a man is to receive, and, if the company really does desire that this should be disclosed, it should be disclosed, while if the board are able to convince the company that it ought not to be disclosed and that there is no necessity that it should be disclosed, and if the company back them up, then few, or comparatively few, persons would be
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able to get this information, which it is often not to the advantage of the company that they should have. Accordingly I venture to hope that the suggestion that Lord Gainford has put forward, backed by very strong interests indeed, will be accepted in view of the very difficult situation that would arise if the procedure laid down in Clause 74 were followed as it stands.
Amendment moved—
Page 70, line 19, leave out from ("shall") to ("furnish") in line 23, and insert ("if required by special resolution of the company so to do").—(Lord Askwith.)
LORD KYLSANT: My Lords, I cannot help feeling that this Amendment goes further than is quite reasonable. Some Amendment may be desirable, but if the majority of a company really desires this information, my own view is that it should be supplied. I can quite understand from the speech of the noble Lord, Lord Askwith, that it might not be unreasonable to ask for a three-quarters majority, but if the majority of any company desires to have this information I certainly feel that they should have it.
LORD BANBURY OF SOUTHAM: My Lords, I agree with Lord Kylsant, and I do not understand why this information should be withheld. Lord Askwith gave, as I understood him, one reason and one reason only. That was that some particular expert, who was receiving a very large salary, and who was a manager, had been asked to join the board, and that therefore as he had joined the board the large sum which he was receiving in addition to his director's remuneration, as manager, would be disclosed. The answer is that the manager need not join the board and in that case nothing need happen. But I must say that I think there can be no harm whatever in letting the shareholders—after all, the directors are the servants of the shareholders—know what they are paying for their services. It may be said that there are certain people who are receiving at the present moment enormous sums for certain services which they are supposed to render, but having been for many years connected with certain companies, my opinion is that the sums so paid are totally beyond the value of the services rendered. It seems to me a ridiculous idea to think that all you have to do is

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to give a man £15,000 a year and immediately he becomes a sort of demi-god. My own belief is that you could find many others capable of doing the same thing better for one-third of the salary. Therefore I think it is right that the shareholders should know to whom, and what, they are paying, for after all it is their own money.
LORD HUNSDON OF HUNSDON: My Lords, I should like to support the Amendment of my noble friend, but with one slight alteration. It may be really a very bad precedent if 25 per cent. of the shareholders are allowed to dictate to the board, which after all is the company, on any subject at all, and it is for the same reason that I am inclined to agree with Lord Kylsant when he states that 75 per cent. is necessary for a special resolution. I suggest that we should leave out from the Amendment the word "special," and then the will of the majority of the shareholders would prevail.
LORD BALFOUR OF BURLEIGH: My Lords, I am very doubtful as to the wisdom of the Amendment. If the suggestion which has been made were accepted you might as well leave out the clause, because if a majority wants a thing, and passes a resolution in the ordinary way, it can get it. The object of the clause is to prevent abuses, and I think the effect of getting greater publicity is a very valuable one. For that reason I am very doubtful as to the wisdom of limiting the clause at all, and subject to anything that the Lord Chancellor may have to say I should be very sorry to see the Amendment accepted.
LORD OLIVIER: My Lords, I entirely agree with Lord Balfour of Burleigh. Lord Hunsdon spoke of the will of the majority of the shareholders prevailing. I presume he means the will of the majority of the proxies. There are companies in which a large block of ordinary shares are held by certain directors who are unquestionably in receipt of very large remuneration, and preference shareholders and minority shareholders have no means of ascertaining what is the remuneration which those directors are receiving. I think this clause is a very excellent one in the interests of publicity, and I hope the Government will not give way upon it.
THE LORD CHANCELLOR: My Lords, I have discussed this Amendment with the President of the Board of Trade, and I am disposed to think that 25 per cent., for which the clause as drawn provides, is rather too low a proportion, because if you say that a quarter of the shareholders may require this information it is still possible that some large holder of shares—some person who acquires for his own purpose a large block of shares—may call for this information for purposes not closely connected with the company in question. Therefore I think that 25 per cent. is rather too low. On the other hand. I could not possibly assent to a special resolution, because, as Lord Askwith has reminded you, it means the vote of three-quarters of the shareholders present in person, or by proxy, at the meeting of the company. I think a fair solution is to say that an ordinary resolution of the company shall be sufficient. After all, the affairs of the company are managed by the board subject to directions given by the company in ordinary meetings, by ordinary resolution passed by a bare majority of those present or by proxy. Therefore if the noble Lord will withdraw his Amendment, and move it with the word "special" omitted, I shall be prepared to accept it.
LORD ASKWITH: I should be prepared to take that course. That will allow the directors to meet the whole of the shareholders of the company and not be forced by a bare minority, who may have gone behind the scenes and who at any time may put forward this request. I am not against this disclosure of information, but it ought to be given when the company wants it, and in a legitimate manner, on the decision of the people who have a right to be consulted.
Amendment, by leave, withdrawn.
Amendment moved—
Page 70, line 19, leave out from ("shall") to ("furnish") in line 23, and insert ("if required by resolution of the company so to do").—(Lord Askwith.)
On Question, Amendment agreed to.
Amendment moved—
Page 70, line 25, leave out ("date") and insert ("receipt by the company").—(The Earl of Halsbury.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, to add to subsection (2):—
"Provided always that it shall be sufficient to state the total aggregate of all sums paid to or other emoluments received by all the directors in each year without specifying the amount received by any individual."
The noble Earl said: My Lords, this Amendment really, I think, only deals with a point assented to in the Committee stage—namely, that the sums of remuneration shall he given in the aggregate and not in detail. It may be possible to work out the individual remuneration, but I think that possibly when the arithmetical sum comes to be done it will not be found to be quite so easy as is suggested. At all events I think the principle of my Amendment was more or less accepted in Committee.
Amendment moved—
Page 71, line 4, at end, insert the said proviso.—(The Earl of Halsbury.)
LORD BANBURY OF SOUTHAM: My Lords, I am afraid I must disagree with the noble and learned Earl on this point. I do not see what there is to be ashamed of. Why should not the shareholders know that Mr. A. is receiving £2,000 a year, while other directors are only receiving £500 each? Why should they not be told? I do not believe in all this secrecy. It only creates suspicion in the minds of the shareholders, and I see no earthly reason why the information should not be given.
THE LORD CHANCELLOR: My Lords, this is in accordance with the recommendations of the Committee on which we have very much to rely, and I should be disposed to assent to this Amendment if the House finds it acceptable.
LORD BANBURY OF SOUTHAM: My Lords, we have not the authority of the Committee in every case, and the Committee, though composed of very competent persons, may occasionally be wrong. It is not important, but I really do not see why a director should object to any shareholder knowing what he is receiving. It seems to me the proper course to pursue. I cannot see what there is behind this.
LORD OLIVIER: My Lords, I really must strongly support the point made by the noble Lord opposite, with all his great experience. In some companies
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there are unquestionably cases where directors do receive quite a peculiar amount of remuneration, and why the whole amount should be lumped in the aggregate, without specifying any individual, I cannot conceive, except on the ground that is is to obscure the policy pursued by the directors.
THE EARL OF HALSBURY: My Lords, I think the argument in favour of having an aggregate instead of disclosing each separate director's emoluments has been brought before your Lordships on two or three occasions within the last few months. It is not a question of not wanting to disclose these emoluments to the shareholders of the company, but of not wanting to disclose them to the management of your rivals, because, if you do, your rivals will come along and offer higher emolument in order to entice away the best business man in your company. It is on that, I think, that the Greene Committee acted.
On Question, Amendment agreed to.
Clause 77:
Companies, etc., disqualified for acting as liquidator, auditor or receiver of a company.
77.—(1) No body corporate (but not including a firm in Scotland) shall be qualified to act as liquidator (whether in a winding-up by the Court or in a voluntary liquidation), auditor or receiver of the property of a company, and any appointment made in contravention of this provision shall be void.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, near the beginning of subsection (1), after "No body corporate (but not including a firm in Scotland) shall," to insert. "unless appointed so to act before the passing of this Act." The noble and learned Viscount said: It seems to me that this clause ought not to apply to auditors and other officers already appointed; it is rather hard on them.
Amendment moved—
Page 71, line 40, after ("shall") insert the said words.—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 78:
Provisions as to auditors.
(2) The following shall be substituted for subsection (5) of Section one hundred and twelve of the principal Act:—
"(5) Subject as hereinafter provided, the first auditors of the company may

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be appointed by the directors at any time before the first annual general meeting, and auditors so appointed shall hold office until that meeting:
Provided that—
(a) the company in general meeting may remove any such auditors and appoint others in their place; and
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, in subsection (2) (a), to leave out "in general meeting may," and to insert "may at a general meeting of which notice has been served on the auditors in the same manner as on members of the company." The noble Earl said: My Lords, in this clause as originally drafted the auditor of the company might be removed by a snap vote at the first meeting of the company, and, in order to obviate that, this Amendment provides that "the company may at a general meeting of which notice has been served on the auditors in the same manner as on members of the company remove any such auditors ….," and by a later Amendment it is provided that notice has to be given of the nomination of any fresh auditors.
Amendment moved—
Page 72, line 20, leave out ("in general meeting may"), and insert the said new words.—(The Earl of Halsbury.)
THE LORD CHANCELLOR: My Lords, I am prepared to accept this and the following Amendments.
On Question, Amendment agreed to.
Amendments moved—
Page 72, line 21, leave out ("others")
Page 72, line 22, after ("place") insert ("any other persons being persons who have been nominated for appointment by any member of the company and of whose nomination notice has been given to the members of the company not less than seven days before the date of the meeting").—(The Earl of Halsbury.)
On Question, Amendments agreed to.
Clause 85:
Restrictions on offering of shares for sale or for subscription.
85.—(1) It shall not be lawful for any person to go from house to house offering shares for subscription or purchase to the public or any member of the public.
(2) Subject as hereinafter provided, it shall not be lawful to make an offer in writing to any member of the public of any shares for purchase unless the offer is accompanied by a statement in writing
1080
(which must be signed by the person making the offer and dated) containing such particulars as are required by this section to be included therein and otherwise complying with the requirements of this section:
Provided that the provisions of this subsection shall not apply—

(a) where the shares to which the offer relates are shares which are quoted on, or in respect of which permission to deal has been granted by, any recognised stock exchange in Great Britain and the offer contains a statement that the shares are so quoted or that such permission has been granted; or

(b) where the shares to which the offer relates are shares which a company has allotted or agreed to allot with a view to their being offered for sale to the public.

(4) The said statement shall contain particulars with respect to the following matters—
(e) the total amount of any bonds, debentures, debenture stock or other similar obligations issued by the company and outstanding at the date of the statement, together with the rate of interest payable thereon;
(5) If any person acts, or incites, causes or procures any person to act, in contravention of this section he shall he liable to a fine not exceeding two hundred pounds, and in the case of a second or subsequent offence to imprisonment for a term not exceeding twelve months or to a fine not exceeding five hundred pounds, or to both such imprisonment and fine.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved to add to subsection (1): "'House' in this section means private residence'". The noble Earl said: My Lords, this is an Amendment which I am raising at the request of the noble Lord, Lord Harris, who has to be away to-day on public duty. Clause 85 is intended to prevent what is commonly known, especially in some of the more popular papers, as the house-to-house offering of shares. I do not know because I have not had time to investigate, but I should not be at all surprised if this were the first Bill before either House of Parliament in which the words "house to house" came in. On the Committee stage Lord Harris pointed out that it was rather a difficult expression to construe, unless it is construed in its ordinary sense, which involves the meaning of every house. The noble and learned Viscount on the Woolsack thought

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everybody knew what "house to house" meant. I am not certain that everybody does. The words have to be construed strictly, and if they are left as we find them in the Bill what will be the effect on an issuing house who are going to underwrite shares? What happens in practice? They put down on a list what they think certain firms will take, and then send one of their clerks round the City to see these various people whose names they have put down, and ask them if they will take what it is suggested they should take. Why is that not offering shares from house to house? I cannot see why it is not; but I am perfectly certain that the promoters of the Bill never intended to put an end to what is a well-known custom in the City of London. The Amendment would exclude the offices in the City, and would allow a business office to act in the ordinary way.
Amendment moved—
Page 76, line 19, at end insert ("'House' in this section means 'private residence'").—(The Earl of Halsbury.)
THE LORD CHANCELLOR: My Lords, I think there is something to be said for this Amendment. We do not want to prevent these people going from office to office offering shares to brokers, who know very, much more about them than the hawker knows himself. The only objection I see is that the share hawker might go, in some country places, from shop to shop and try to sell his shares to inexperienced people, and this Amendment would not prevent it. I think if the noble Earl would move it in this form, by inserting the word "subsection" for "section," it might be agreed to.
THE EARL OF HALSBURY: Certainly I accept that.
Amendment, by leave, withdrawn.
Amendment moved—
Page 76, line 19, at end insert ("'House' in this subsection means 'private residence"'). (The Earl of Halsbury.)
On Question, Amendment agreed to.
THE EARL OF HALSBURY THE EARL OF HALSBURY moved, in subsection (2) in the paragraph preceding the proviso, after "public," to insert "other than a share dealer or a share broker." The noble Earl said: My Lords, I think this follows from the last Amendment.
Amendment moved—
Page 76, line 22, after ("public") insert ("other than a share dealer or share broker").—(The Earl of Halsbury.)
On Question, Amendment agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in subsection (4) (e), to leave out "bonds." The noble and learned Viscount said: My Lords, this Amendment and the following one in my name are drafting Amendments.
Amendment moved—
Page 77, line 29, leave out ("bonds").—(The Lord Chancellor.)
On Question, Amendment agreed to.
Amendment moved—
Page 77, line 30, leave out ("debenture stock or other similar obligations").—(The Lord Chancellor.)
On Question, Amendment agreed to.
VISCOUNT BERTIE OF THAME VISCOUNT BERTIE OF THAME moved, in subsection (5), before "a fine" where those words first occur, to insert "imprisonment for a term not exceeding six months or to." The noble Viscount said: My Lords, I took advantage of the noble and learned Viscount's suggestion in Committee and interviewed a representative of the Home Office in regard to this matter. The result of that interview is this and the following Amendment which stand in my name. The gentleman I saw said the Home Office would welcome the opinion of the Court and thought that this was the most convenient way of bringing to the attention of the Court the fact that a person convicted was liable to deportation. I beg to move.
Amendment moved—
Page 78, line 18, after ("to") insert ("imprisonment for a term not exceeding six months or to").—(Viscount Bertie of Thame.)
LORD HUNSDON OF HUNSDON: My Lords, I hope your Lordships will not accept the Amendment, which, I understand, alters the Bill in the matter of punishment. If your Lordships alter this Bill in any matter of punishment it will be assumed by the House of Commons, when it goes down to that place, that you have considered the question of the punishments in this Bill. That, I believe, is not the case. Certainly the Law Society have not considered the punishments in the Bill, nor do I think the chartered accountants have. I do not, in fact, know anybody who has. I have

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taken out of the Bill all the punishments and all the crimes and I have compared them. I have no knowledge of what I may call the crime tariff of this country and it was impossible for me to propose any Amendments with regard to them. I wish to say this—because this is the only opportunity of doing so—that in my judgment some one who does understand and know what I call the crime tariff of this country should go through this Bill clause by clause and see if the punishments are proportionate.
I am only going to give two examples of what I think are the very disproportionate punishments in this Bill. Clause 34 says that if a copy of the balance sheet is not sent to every shareholder seven days before the general meeting the company directors and officers are liable to a £20 fine. That is a technical offence and £20 is the fine. The default must be knowingly and wilfully permitted. Clause 38, which also deals with a technical offence, says that if a company has bought a property with a mortgage on it before the passing of this Act they have to send the Registrar of Companies a copy of the mortgage and all particulars within six months after the passing of the Act. The company may have bought the property with the mortgage on it many years before and may have mentioned the mortgage in the balance sheet every year and the chairman may have referred to it every year in his speech, but because they have committed the technical offence of omitting to send a copy of the mortgage to the Registrar of Companies the directors, officers and secretary are liable to a fine of £50 a day (during which the default continues; that is to say, at the rate of £18,250 a year, which not only takes a very sanguine view of the financial position of most secretaries that I know but seems excessive and out of proportion to the offence, which is a technical one.
LORD PARMOOR: I understand this is a reduction from twelve months to six months.
VISCOUNT BERTIE OF THAME: No, it is six months on the first conviction.
LORD PARMOOR: Then I agree with what the noble Lord, Lord Hunsdon, has said.
THE LORD CHANCELLOR: My Lords, the clause, as drawn, provides that for the first offence of this class the penalty shall be a fine not exceeding £200, but for a second offence imprisonment for a term not exceeding twelve months or to a fine not exceeding £500, or to both such imprisonment and fine. The Aliens law provides that if an alien is convicted of an offence which carries imprisonment he can be deported under the Aliens Act. The effect of this Amendment is that he may be deported where he is only fined for a first offence. The object of the Amendment is to bring this offence within the category of offences for which deportation may be ordered by the Court. If the noble Viscount has discussed this with the Home Office where they know all about these penalties, and if, as I understand, he has obtained their approval, then, unless your Lordships see some objection in principle, I think we might accept the Amendment. I do not think, except in a very serious case, imprisonment would actually be imposed.
On Question, Amendment agreed to.
Amendment moved—
Page 78, line 19, after ("pounds") insert, ("or to both such imprisonment and fine").—(Viscount Bertie, of Thame.)
On Question, Amendment agreed to.
Clause 90:
Amendment of s 208 of principal Act.
90. For Section two hundred and eight of the principal Act (which relates to the ranking of claims in Scotland), the following section shall be substituted:—
(2) In the winding up of a company registered in Scotland, where there have been mutual credits, mutual debts or other mutual dealings between the company and any creditor or person claiming to be a creditor of the company, an account shall be taken of what is due from the one party to the other in respect of such mutual dealings, and the sum due from the one party shall be set off against any sum due from the other party, and the balance of the account and no more shall be exigible; but nothing in this Provision shall entitle any person to claim the benefit of any set off against the property of a company in any case where he had at the time of giving credit to the company notice of any fact which would have enabled a creditor to present a petition for the winding up of the company on the ground that it was unable to pay its debts.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to leave out subsection (2). The noble and learned Viscount said: My Lords, it is proposed to omit this subsection and leave the matter with which it deals to be, regulated by the Common Law as it is in Scottish bankruptcy proceedings. The Amendment, which was suggested by the Scottish bank managers, has the approval of the Lord Advocate.
Amendment moved—
Page 81, lines 12 to 29, leave out subsection (2).—(The Lord Chancellor.)
On Question, Amendment agreed to.
Clause 99:
Unclaimed dividends, &c. to be lodged in bank.
99. When a company registered in Scotland has been wound up, and is about to be dissolved, the liquidator shall lodge in a joint stock bank of issue in Scotland (not being a bank in or of which the liquidator is acting partner, manager, auditor, agent or cashier in the name of the Accountant of Court the whole unclaimed dividends and unapplied or undistributable balances, and the deposit receipts therefor shall be transmitted to the Accountant of Court; and the provisions of Section one hundred and fifty-three of the Bankruptcy (Scotland) Act, 1913 so far a, consistent with this Act, shall with any necessary modifications, apply to sums lodged in bank in pursuance of this section in like manner as they apply to sums deposited in pursuance of that enactment.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved to leave out "auditor." The noble and learned Viscount said: My Lords, thy effect of this Amendment is to make the opening lines of Clause 99 read as follows:—
"When a company registered in Scotland has wound up, and is about to be dissolved, the liquidator shall lodge in a joint stock bank of issue in Scotland (not being a bank in or of which the liquidator is acting partner, manager, agent or cashier) in the name of the Accountant of Court the whole unclaimed dividends and unapplied or undistributable balances."
There seems no reason why the liquidator should be precluded from selecting for the deposit of unclaimed dividends a bank of which he happens to be the auditor. A trustee in bankruptcy is not so restricted by the similar provisions regarding Scottish bankruptcies. This amendment was suggested by the Scottish bank managers and has the approval of the Lord Advocate.
Amendment moved—
Page 84, line 30, leave out ("auditor").—(The Lord Chancellor.)
On Question, Amendment agreed to.
VISCOUNT BERTIE OF THAME VISCOUNT BERTIE OF THAME moved, after Clause 101, to insert the following new clause:—
". At the end of Regulation 8 of Table A of the principal Act there shall be inserted the following new regulation:—
(8A) No part of the funds of a subsidiary company shall be employed in the purchase of, or in loans upon the security of, the shares of the parent company. Subsidiary company shall bear the same interpretation as that contained in subsection (6) of Section thirty-live of this Act"
The noble Viscount said: MY Lords, as you already know, it is illegal for a company to deal in its own shares, but there is nothing to prevent it forming a subsidiary company and supplying it with money, not with the avowed object but still with a view to dealing in that company's shares. That is an evasion of the law. There is another objection and that is, if the parent company has to go out of business and a subsidiary company holds a large block of its shares that company also probably would have to follow suit. I have here the balance sheets of two companies which I will call A. and B. Company A. has an ordinary capital of £200,000 of which Company B. holds £113,000. Company A. holds shares in Company B. and some other companies in the same class of business which stand in their books at the sum of £310,000, so that the holding must be considerable. I submit that such a state of affairs is quite wrong, and I would ask your Lordships to remember the City Equitable and its subsidiaries.
Amendment moved—
Page 85, line 10, at end insert the said new clause.—(Viscount Bertie of Thame.)
THE LORD CHANCELLOR: My Lords, I really do not think this proposed new clause is suitable for insertion in this Bill. The proposal is to add a new regulation to Table A of the Companies Act. That table, as your Lordships know, is a model form of articles which a company may adopt if it pleases, which it may not adopt at all. Or which it may adopt with variations. As a matter of fact I believe Table A is adopted in its entirety by very few companies. It is much more common to find a company adopt an entirely new set of articles of its own. Therefore it would not be very much use to put in

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these words. They would have very little effect. Further, Table A may be amended by the Board of Trade, and the proper course would be to put the matter before the Board of Trade and ask them to exercise that power. I am not discussing the matter on its merits, but it would complicate this Act to insert these words.
VISCOUNT BERTIE OF THAME: I will not press the Amendment, but I do not quite understand what I ought to do.
THE LORD CHANCELLOR: If the noble Lord after this Bill has passed will approach the Board of Trade and put his points to them and ask them to amend Table A under their powers, they will, I am sure, consider the matter.
VISCOUNT BERTIE OF THAME: I am much obliged to the noble Viscount. I will not press the Amendment.
LORD BANBURY OF SOUTHAM: My Lords, may I say that I am afraid that this Amendment might produce a rather extraordinary state of affairs. Though no doubt certain parent companies do things which they ought not to do there are some companies—I know of one myself—which hold shares in other companies quite legitimately. Take the case of an English company which holds shares in an American company with a result which is very good to the shareholders of both companies. Under this Amendment if it were passed or, as I understand it, if my noble friend goes to the Board of Trade and gets an alteration in Table A, that would be prevented. I really do think we must be careful what we are doing. We cannot by legislation prevent a man being stupid—I wish we could—but we must not pass legislation which will interfere with legitimate business.
Amendment, by leave, withdrawn.
Second Schedule:
SECOND SCHEDULE.
MINOR AMENDMENTS.

Section of Act.

Amendment.

S. 209

After subsection (1), the following new subsection shall be inserted:—

"(1A) When any person has advanced money to a company for the purpose of paying any wages or salary to which paragraph (b) or paragraph (c) of

THE LORD CHANCELLOR: My first two Amendments to this Schedule are drafting.
Amendments moved—
Page 93, line 17, leave out ("(1)") and insert ("(2)").
Page 96, line 17, leave out ("(f") and insert ("(ff)").—(The Lord Chancellor.)
On Question, Amendments agreed to.
THE LORD CHANCELLOR THE LORD CHANCELLOR moved, in the reference to Section 209, to leave out the new subsection (1A) and insert:—
"(1A) Where payments on account of wages or salaries have been made to any clerks, servants, workmen or labourers in the employment of a company out of moneys advanced by some person for that purpose, that person shall in a winding-up have a right of priority in respect of the moneys advanced up to the amount in respect of which those clerks, servants, workmen or labourers would in the aggregate have been entitled in the winding-up to priority in respect of those wages or salaries."
The noble Viscount said: This is a drafting Amendment which simply puts the matter in a better form.
Amendment moved—
Page 97, leave out lines 16 to 24 and insert the said new subsection.—(The Lord Chancellor.)
On Question, Amendment agreed to.
LORD ARNOLD LORD ARNOLD moved to leave out the reference to Section 243. The noble Lord said: My Lords, this Amendment deals with a point of some importance though I need not detain your Lordships more than a moment or two in putting the case for it. The words which are in the Second Schedule give power, as your Lordships will see, to destroy any documents relating to companies after the expiration of twenty years from the date of dissolution

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of the company to which the documents relate. The effect of this would be to destroy a very large number of documents which are in existence at the present time and which are most valuable for the purposes of research. Documents from the year 1845 onwards would be destroyed. Those documents are available at present for an analysis of the flow of capital and so forth in particular decades, and they throw much light upon the question of industrial development during those years. They furnish unique and irreplaceable evidence of the exact ebb and flow and direction of capital from 1845 onwards. That, I think, is of great importance. What is at stake? Really only a little space can be required in which to continue the keeping of these documents. If the Government cannot find room for them—though I think they could—they are of such value that certain outside bodies, I think, would come to the rescue. I have no authority to speak in the matter, but I would suggest that perhaps the London School of Economies, which does a great deal of research, would house some of these valuable documents and there are other organisations which might be disposed to come to the rescue. Obviously the space required to keep these documents cannot be very great in proportion to the great mass of papers which the Government has to keep. It has to keep, for instance, a copy of every newspaper published. Most of them do far more harm than good. Yet, at the present time they have to be kept. Really the additional space required to keep these documents could only be quite small.
One final point I should like to put is that before many years there is bound to be another Companies Bill. If it is found that the congestion is too great the matter can be dealt with then, but I would ask for a little respite. This Bill has had predecessors and there will be successors. I would emphasise the great advantage of these documents which, when once destroyed, cannot be replaced. That is the main point I want to put. I do ask that this respite be granted, because if later there is found to be a possible difficulty—though I cannot see any real difficulty—it can be dealt with. I submit that the reasons in favour of destruction are not nearly so strong as the reasons in favour of the preservation of these documents. I do not think there has been
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any real demand for this from anybody, and on the other hand I may say that there are persons who are entitled to consideration who are greatly concerned about this matter. I hope, therefore, the Government will accept this very modest Amendment. I believe I am right in saying that this is the only Amendment which has been moved from these Benches. In any case it will be certainly the only Amendment accepted.
Amendment moved—
Page 99, leave out line, 27 to 34.—(Lord Arnold.)
THE LORD CHANCELLOR: My Lords, I was very much touched with the appeal of the noble Lord that the Labour Party should be allowed to carry one Amendment to this Bill. But apart from that feeling I have much sympathy with this proposal. I have seen a letter from a gentleman engaged in economic research, who say he is desirous of going through these old company files in order to follow the course of trade during the last century. I do not envy him, but I do not see why his taste should not be indulged. The present position is that the destruction of public documents and records, which must take place from time to time, is carried out under the Public Record Office Acts and is under the control of the Master of the Rolls. The procedure is that when a Department proposes that documents shall be destroyed, a classified schedule of those documents must be submitted to the Master of the Rolls for approval. When the schedule is approved it is laid before both Houses of Parliament for four weeks before it becomes operative. That is a very reasonable and well-guarded procedure and it might well be applied to documents of the nature we are discussing. If the House accepts that view I would propose that the Amendment should be accepted leaving the matter to be dealt with in that way.
On Question, Amendment agreed to.
Amendments moved—
Page 99, line 42, at end, inert:—
("Section 285, At the end of the definition of debenture there shall be added the words 'bonds or other like securities.'")
Page 100, line 24, after ("100") insert ("the above fee of £2 with an additional £1")
Page 100, line 27, leave out ("1 0 0")
Page 100, line 33, after ("unlimited") insert ("a fee of £5 with an additional 5s.")
Page 100, line 35, leave out ("0 5 0")
—(The Lord Chancellor.)
On Question, Amendments agreed to.

WORKMEN'S COMPENSATION (TRANSFER OF FUNDS) BILL. [H.L.]
House in Committee (according to Order): Rill reported without amendment.

SCOTTISH NATIONAL WAR MEMORIAL.
THE DUKE OE BUCCLEUCH THE DUKE OE BUCCLEUCH rose to call attention to the action of the Lyon King of Arms in connection With the Scottish National War Memorial in Edinburgh Castle; and to move for Papers. The noble Duke said: My Lords, I shall not take up very much time on this question, which is not perhaps of first-class importance but is still of considerable interest. Perhaps your Lordships are aware that a Scottish national memorial has been erected in Edinburgh Castle. That memorial is nearly completed. It was started with Government sanction and the Chairman, Committee and secretary, if they were not appointed by the Government, were certainly sanctioned by them. It also had the approval of the Crown and the building, which will shortly be opened, being erected on Crown land, will obviously belong to the Crown, and therefore to the nation, so that it is not a private monument, except that the funds for building it have been collected from private subscriptions.
The great object of this memorial was to represent all of those who were born in Scotland or who were of Scottish domicile and who fell in the Great War, to whatever Service they belonged and whether they were men or women. There are representations of all the Scottish regiments and also memorials of some of the other forces, such as the Navy and the Air Force, but it is obvious that this did not by any means represent the whole of those who served. At the beginning of the War there were a very large number in the South of Scotland and in
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other parts who volunteered but, because the numbers were so great and it was impossible to put them all into Scottish regiments, they were given the option of joining English regiments. Throughout the War, therefore, numbers of these Scottish troops who joined up were sent to English and even Irish regiments.
In order to make this memorial more representative it was decided to have the arms of all the counties and some of the principal burghs. They were all put up by the architect and it was thought everything would be all right. However, the Lyon King of Arms ordered the architect to take them down because certain—I do not know exactly how many—of the counties had not registered their arms. My point is that, in a matter of this kind, the importance of having a correct and proper national memorial was far greater than any petty question of whether these arms had been registered or not. I do not wish to defend those county councils who have not registered their arms, because it is obvious they ought to have done so. There is no reason why, because they have neglected to do so, those who came from those counties should be penalised in a matter with which the county councils have nothing to do.
I do not suppose the order of the Lyon King of Arms would have had any effect, except that it so happened the secretary of the Committee and he were the same individual and he could therefore carry out the order. If anybody else had been secretary, I imagine the order would have been laughed at and the pastime so popular with Americans of twisting the lion's tail would have been indulged in. These arms, however, have had to come down, with the result that the memorial is not as representative as it should be. This is entirely new. These burghs and counties have been using these arms for years without any objection being taken. Here is the opportunity for a great national memorial to be raised up and it is far removed from any question of whether burghs or county councils have arms registered or not. To try to force them to register in this way is an entirely wrong action, one which should never have been carried out, and one of which I hope the Government do not approve. I am not a lawyer, but I should doubt whether Lyon King of

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Arms was legal in his action. Since this property belongs to the Crown, it seems to me that he was putting the office of Lyon above the Crown, and I was always under the impression, and I sincerely hope, that the Crown is above every one, even including the Lyon King of Arms.
I want to ask the Government, in the first place, whether this action was legal, and if the Lyon King at Arms has power to do anything of that kind without the sanction of some superior Court. It seems to me to be a very large order if he is able to remove or to damage any structure without the order of some superior Court. My second question is why this particular occasion has been taken to force this matter through, when the county councils have been using their arms in other ways for years. The Government cannot get out of their responsibility in this matter. I do not know what is the position of the holder of this medi…val office in relation to the Government, but the appointment is made by His Majesty on the recommendation of the Secretary of State for Scotland, and accordingly I think they must have some responsibility. Certainly a great responsibility rests upon them that this monument should be really representative. I hope to hear in reply their view that this action, if not actually illegal, was certainly taken without their approval; for, after all, whatever else may be said, this was a very petty and tactless thing to do in regard to a memorial of such vast importance as the national memorial to all those from Scotland who fell in the War. I beg to move.
THE PAYMASTER-GENERAL (THE DUKE OF SUTHERLAND): My Lords, the Lyon King of Arms Act, 1867, provides that
"The jurisdiction of the Lyon Court in Scotland shall be exercised by the Lyon King of Arms, who shall have the same rights, duties, powers, privileges and dignities as have heretofore belonged to the Lyon King of Arms in Scotland."
The rights, powers, etc., so referred to are embedded in the Common Law of Scotland and in various Statutes with which I need not weary your Lordships as they are considerable in number. To put the position briefly, no person or body in Scotland is obliged to bear arms. If, however, it is desired to bear them the law imposes the obligation, whether on
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private individuals or on burghs, towns or counties, of obtaining the right, either by establishing in the Lyon Court and registering in the Lyon Register a right belonging to their predecessors prior to 1672, or, failing that, by obtaining a new grant. The Lyon King of Arms has no power to permit a contravention of the law on the subject.
The present Lyon King of Arms was appointed to that office only last January. Immediately after his appointment it was brought to his notice that several of the shields of coats of arms intended as decorations in the Scottish national war memorial were not recorded in the Public Register of Arms and Bearings. As the use and display of these arms would be illegal the Lyon King of Arms was bound to take action whether he wished to do so or not. On March 10, 1927, the Lyon King wrote to those county councils who had no registered coats of arms explaining that it was proposed to engrave on the walls of the Scottish national war memorial, in addition to regimental badges, some recognition of the districts from which the various services had been recruited, that in cases where public bodies had duly registered arms these would be recorded on the walls, but that it would not be possible to record arms which were not duly registered. In such a matter his jurisdiction is self-contained and the Secretary of State for Scotland has no power either to give or to withhold approval of any action which the Lyon King may think necessary in regard to enforcement of the law.
The fee for registration of arms is £50. All such fees are paid into Exchequer and go towards relief of the general taxpayer. I believe that this is not so in England, where they go to the responsible authority. Since Lyon King took action in March, twelve counties and two burghs have recorded their arms, and I think only one or possibly two counties have not done so. I think the noble Duke said that in many cases this sort of thing had been allowed before, but this is not by any means the first occasion on which Lyon King has found it necessary to intervene in order to prevent illegal use of arms in connection with public buildings. During the years 1863–5, a number of unregistered armorial bearings were placed in the stained glass windows of Glasgow Cathedral In

1095
obedience to the commands of Lyon King a number of these were removed whilst many of the persons concerned registered arms in order that they might be permitted to appear. Similar action was taken in connection with a contemplated display of unregistered arms in connection with the McEwan Hall in Edinburgh, and in connection with the renovation of windows in the Parliament House.
It is quite true, as the noble Duke said, that the memorial is being erected on Crown property and that the scheme had the general approval of the Government. On the other hand, the Government have not been consulted regarding, and have no responsibility for, minor details of the scheme, such as the display of coats of arms on the walls, and matters of that sort, which have not been brought into the purview of the Government in any way. When the Committee in charge of the memorial proposed to display arms as part of the decoration, the proper course would have been to ascertain from Lyon that the arms were in order, but the Committee may, mistakenly but not unnaturally, have assumed that arms which were being used by local authorities were being so used with proper authority. However that may be, it was the statutory duty of the Lyon to see that arms were not irregularly displayed, and the action he took seems to the Government quite reasonable and proper.
In reply to the legal point that the noble Duke raised, I may say that this action was perfectly legal. Lyon King of Arms has no authority whatsoever to remit fees, and I really think that one must look at it from the point of view
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of what would have happened if he had not taken action in the way he did. His conduct in that case would have been illegal and totally unauthorised, and some notice must have been taken of it.
THE DUKE OF BUCCLEUCH: My Lords, the answer is somewhat on the lines that I expected, but I think it is very disappointing because, after all, the question of the national memorial is far greater than any question of mere red tape. What I want to know is why these county councils have been allowed for years to use these arms if they are not entitled to them. Apparently nothing has been done, and what was resented, and I think rightly, was that a very solemn occasion was used to force people to register—and people, particularly Scotsmen, do not like being forced. I am sorry that the Government are not taking any action. The only point that I really care about is that the memorial should be really representative of the whole of Scotland, as it will not now be, and that is my reason for raising this question. But since my noble friend tells me that the Secretary of State has no jurisdiction over the Lyon King of Arms, and as I believe that no qualifications are necessary for appointment to that office, I will only suggest that, as much has been said lately about various offices in Edinburgh, I think that this particular office may perhaps require looking into and somewhat overhauling. I do not propose to press my Motion for Papers.
Motion, by leave, withdrawn.
House adjourned at twenty minutes past seven o'clock.

YORKSHIRE ELECTRIC POWER BILL. [H.L.]
Returned from the Commons, agreed to, with Amendments: The said Amendments considered, and agreed to.
The LORD CHANGELLOR acquainted the House, That the Clerk of the Parliaments had laid upon the Table the Certificate from the Examiners that the Standing Orders applicable to the following Bill hove been complied with:
Ministry of Health Provisional Orders (No. 5).
The same was ordered to lie on the Table.

SWANSEA CORPORATION BILL.
Report from the Committee of Selection that Lord Biddulph be proposed to the House as a member of the Select Committee on the said Bill in the place of the Earl of Westmorland: Read, and agreed to.
BURY ESTATE BILL. [H.L.]
Reported, with Amendments.
BRISTOL WATER BILL.
  SMETHWICK CORPORATION BILL.
  Reported, with Amendments.
COUNTY OF LONDON ELECTRIC SUPPLY COMPANY BILL.
  EAST ANGLIAN ELECTRICITY BILL.
    GREENOCK BURGH EXTENSION, &c., BILL.
    Committed: The Committees to be proposed by the Committee of Selection.
NEWCASTLE-UPON-TYNE CORPORATION BILL.
EAST ANGLIAN ELECTRICITY BILL.
  MANCHESTER CORPORATION BILL.

    GREENOCK BURGH EXTENSION, &c., BILL.
    Report from the Committee of Selection, That the following Lords be proposed to the House to form the Select Committee for the consideration of the said Bills; namely:—

    L. Hastings,

    L. Suffield,

    L. Kintore (E. Kintore) (Chairman),

    L. Strathspey,

    L. Charnwood,

    agreed to; and the said Lords appointed accordingly: The Committee to meet on Monday, July 11 next, at two o'clock; and all Petitions referred to the Committee, with leave to the Petitioners praying to be heard by Counsel against the Bills to be heard as desired, as also Counsel for the Bills.

TIVERTON GAS ORDER, 1927.
  FLINT GAS ORDER, 1927.

    CLEETHORPES GAS ORDER, 1927.
    NEWPORT PAGNELL GAS ORDER, 1927.
    Report from the Special Orders Committee that no Petition has been presented praying to be heard against the Special Orders, that they have received and considered reports from the Board of Trade upon the Orders, and that there is nothing to which they think it necessary to call the attention of the House: Read, and ordered to lie on the Table.

CHELTENHAM ELECTRICITY (EXTENSION) ORDER, 1927.
Report from the Special Orders Committee that no Petition has been presented praying to be heard against the Special Order, and that there is nothing in this Order to which they think it necessary to call the attention of the House: Read, and ordered to lie on the Table.
MINISTRY OF HEALTH PROVISIONAL ORDERS CONFIRMATION (No. 10) BILL. [H.L.]
Committed: The Committee to be proposed by the Committee of Selection in regard to the Hartlepool Port Sanitary Order.
MINISTRY OF HEALTH PROVISIONAL ORDERS CONFIRMATION (No. 11) BILL. [H.L.]
Committed for Tuesday next.
PIER AND HARBOUR PROVISIONAL ORDERS (No. 1) BILL.
  SHEFFIELD CORPORATION TRAMWAYS PROVISIONAL ORDER BILL.
    CARDIFF CORPORATION TRAMWAYS PROVISIONAL ORDER BILL.
    Reported, without amendment, and recommitted to a Committee of the Whole House on Thursday next.
OUSE AND CAM FISHERIES PROVISIONAL ORDER BILL.
Committed: The Committee to be proposed by the Committee of Selection.