Sitting of 7 July 1930

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

PRIVATE BUSINESS.
Brighton and Hove Gas Bill,
Lords Amendments considered, and agreed to.
Clacton-on-Sea Pier Bill [Lords] (Certified Bill),
As amended, considered; King's Consent signified; Bill read the Third time (pursuant to the Order of the House of 11th December), and passed, with Amendments.
Llanelly District Traction Bill [Lords],
As amended, considered; to be read the Third time.
London United Tramways Bill [Lords],
Redcross Street Burial Ground (Bristol) Bill [Lords],
Read a Second time, and committed.
Torquay and Paignton Traction Bill [Lords] (Certified Bill) (by Order),
Consideration, as amended, deferred till this evening, at half-past Seven of the Clock.

ORAL ANSWERS TO QUESTIONS.
  INDIA.

    RAILWAYS (ORDERS).
    Mr. DAYasked the Secretary of State for India whether he has any information and can state the value of orders for locomotives or any other railway essentials which have been ordered during the 12 months ended to the last convenient date from Continental countries by the High Commissioner for India on behalf of that Government?
    The SECRETARY of STATE for INDIA (Mr. Wedgwood Benny): I will circulate these particulars.
    Mr. DAY: Can the right hon. Gentleman say whether every effort is made by his Department to see that these orders are placed in Britain?
    Mr. BENN: I would call my hon. Friend's attention to the fact that the High Commissioner has power to purchase where he thinks fit, without pressure being brought to bear upon him by my Department.
    Following are the particulars:
    The value of the orders for locomotives and other railway material placed in Continental countries by the High Commissioner for India during the 12 months elided 30th June, 1930, is as follows:

    3

    £

    Locomotives

    155,000

    Locomotive boilers

    287,000

    Other railway material

    166,000

    AIR MAIL SERVICES.
    Lieut.-Commander KENWORTHYasked the Secretary of State for India whether further consideration has been given to the possibility of sea-planes or flying boats for the carriage of mails between Bombay and Karachi; and, if so, with what result?
    Mr. BENN: I have no doubt that the Government of India considered the alternative of using seaplanes or flying boats before deciding to devote the available funds to preparatory work for a service by land machines. I will ask them for their reasons for this decision.
    Lieut.-Commander KENWORTHY: Will the right hon. Gentleman let me have some further information when he receives it?
    Mr. BENN: Yes, I will communicate with my hon. Friend.
    Major GRAHAM POLEasked the Secretary of State for India if he will give information showing the extent to which the facilities offered by the extension of the air mail service from Karachi to Delhi have been utilised since the inception of the service?
    Mr. BENN: About forty pounds of air mail are posted weekly for onward transmission by air beyond Karachi. I have no information as to the extent to which the service is used for local mails.

    STATUTORY COMMISSION'S REPORT.
    Lieut.-Commander KENWORTHYasked the Secretary of State for India whether he can state the causes of the delay in coming to a decision to translate the Report of the Indian Statutory Commission into certain leading foreign and Indian languages; and whether arrangements have now been made?
    Mr. BENN: No final arrangements have yet been made, but the question is being actively pursued.
    Mr. WILFRID WHITELEYasked the Secretary of State for India what number of copies was printed as a first edition of the Statutory Commission's
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    Report on Indian Reform, Volumes I and II; and what is the number of copies sold to date in Great Britain?
    Mr. BENN: The first edition of Volume I and Volume II was 17,000 and 27,000 copies respectively. The number of copies sold in Great Britain up to the evening of 3rd July was approximately 32,300 and 25,700 respectively.

    HAJI OF TURANGZAI.
    Major-General Sir ALFRED KNOXasked the Secretary of State for India on how many occasions the Haji of Turangzai has been attacked from the air and with what result?
    Mr. BENN: I cannot say definitely from the reports I have received, nor have I had any comprehensive review indicating the precise factors to which the Haji's withdrawal can be properly attributed.

    DATTA KHEL AND BOYA (ATTACK).
    Captain EDENasked the Secretary of State for India whether he can give any further information about the recent attack on Datta Khel and an adjacent fort, particularly as to the numbers engaged on both sides and the composition of the defending troops?
    Mr. BENN: Datta Khel and the adjacent post Boya were attacked on the 11th May by lashkars of Wazir tribesmen originally estimated at 500 and 400 respectively, but it was subsequently stated that these lashkars numbered about 4,000 and 1,200. From the information at my disposal Datta, Khel is garrisoned by four platoons of the Tochi Scouts and Boya by two platoons of these Scouts. With the help of bombing by aircraft the attacks were successfully repulsed, and on the approach of the Razmak Movable Column on the 15th May the enemy withdrew.
    Captain EDEN: Can the Secretary of State say why the gallantry and loyalty of these troops have not been publicly referred to and acknowledged, and can he say whether any presentation has been made to the Indian officer in charge of the fort?
    Mr. BENN: I am not in a position to accept the statement made by my hon. and gallant Friend. In any case, it is

    5
    primarily a matter for the Government of India who would not, I imagine, be lacking in their duty in this respect.
    Earl WINTERTON: Is it not the case that the scouts under this young Indian officer displayed the greatest gallantry in repulsing overwhelming forces? Does the right hon. Gentleman not think it would be proper for him also to make some acknowledgment of their gallantry?
    Mr. BENN: Certainly. I have no desire otherwise, but the question was put in a different form.
    Lieut.-Commander KENWORTHY: Is not the conduct of this gallant Indian officer very typical of the efficiency of the Indian officers of the Indian army?

    TRAINING SHIP (BOMBAY).
    Major POLEasked the Secretary of State for India whether the Government of India have considered the proposal that a training ship, similar to the training ship "Dufferin" at Bombay, should be established in the Bay of Bengal; and if a decision has been arrived at in the matter?
    Mr. BENN: The Government of India have considered this proposal and have decided not to take any action at present.

    ARRESTS, SHOLAPUR.
    Major POLEasked the Secretary of State for India if he will make a statement in regard to the number of persons arrested and convicted of offences during the period of martial law at Sholapur, and the nature of the sentence in each case?
    Mr. BENN: As soon as I receive complete information. I will furnish it to the House.

    SITUATION.
    Mr. WARDLAW-MILNEasked the Secretary of State for India whether he will give the House the latest information he has as to the conditions in India?
    Mr. BENN: I am circulating a statement giving an appreciation of the situation by the Government of India up to 5th July.
    Earl WINTERTON: Will the right hon. Gentleman consider whether it would not be more convenient if what is now a
    6
    weekly communique could be issued in the middle of the week, so that hon. Members and right hon. Gentlemen who wish to ask questions arising out of the communique could put them down on Wednesday or Thursday?
    Mr. BENN: Certainly. I will consider carefully the Noble Lord's suggestion.
    Following is the statement:
    Appreciation of the situation by the Government of India up to 5th July, 1930.
    North-West Frontier Province.—Tribal. Alingar Fakir and other malcontents are trying to stir up trouble again amongst Utman Khel, but those sections of tribe which suffered from recent air action have so far refused to give passage to malcontents or assist them. Efforts, however, are still being made to raise fresh lashkar to occupy old position in Jindai Khwar or to attack Government levy posts. Latest news from Malakand reports outbreak of cholera in Arang and Bajaur. Haji of Turangzai is still at his home in Lakarai, but is sending out messages to tribes calling on them to renew struggle with Government. At usual Afridi jirga 27th June, hostile party of Mullas and young-bloods decided fresh lashkar should be raised against Government on 2nd July. Warning was issued to all sections of tribe announcing Government's intention to take all necessary action unless tribe abandoned intention of organizing lashkars against British territory. Further Afridi jirga on 28th June broke up owing to dissension among the various sections of tribe, and up to 4th July there was no sign of any lashkar materialising. On 30th June, front wheels of leading engine of train from Peshawar to Landi Kotal were derailed near Shagai owing to dog spikes inserted between rail points. No one was injured, and train proceeded on journey. Attitude of Pass Afridis and Orakzais remains good. On two occasions during week shots were fired at militia posts on Kurrum Border. In Waziristan, hostile Mulla Gunn has again succeeded in raising a following with proposed object of attacking friendly Mahsud sections. Warning has been issued to hostiles that air action will be taken against them in event of any further activity.
    Internal situation throughout Province continues rapidly to improve. Only untoward event was on evening of 2nd July, when a light explosion occurred on railway line near Peshawar Fort when Calcutta mail was passing. No damage was done to train or passengers. On 3rd July, representative deputation of many different classes and schools of thought presented address of welcome to Chief Commissioner at Peshawar, including constructive suggestions for development of local self-government and for enhancing general efficiency of administration. Deputation deplored regrettable incidents which caused so grave discontent and strained relations between people and authorities. They strongly pressed question of reforms, and considered that recommendations of Statutory Commission for North-West Frontier Province were altogether inadequate. Suggestions for immediate action related chiefly to local self-government, Panchayats, scope of activities of beneficent departments, assurances relating to land revenue, water rates and local rates, and urged need of closer association of people with administration. Deputation said constitutional agitation is the method on which we rely, and defiance of law is not the course which we pursue or approve of. We feel that our Province cannot advance unless it be through co-operation of Government and people, both working in spirit of mutual confidence. Chief Commissioner gave sympathetic and encouraging reply, assuring deputation of sympathy and support in measures of reform under existing law. He announced that district boards and municipalities would be reconstituted and elected element introduced, and that Panchayat Act of Punjab would be referred to Committee for report. He accepted the principle that in beneficent departments standard of administration to be attained in Province should not be below that prevailing in adjoining districts of Punjab, and he gave assurances that reassessment proposals of Peshawar District would be examined in light of Punjab Land Revenue Amendment Act, and that land revenue, water and local rates would not be higher in the North-West Province than in the Punjab. He assured them that he looked with sympathy on natural aspirations of people to advance intellectually, economically
    8
    and politically, and concluded with the following words: The task before us, the Government as well as the people, is a great and noble one. Its successful accomplishment needs the co-operation of both, and it is my earnest desire to see the Province prosperous, contented and progressive. Honourable Mian Sir Fazli Hussain was present with Chief Commissioner, and associated himself, on behalf of Government of India, with all assurances given. Function in political circles is believed to have far-reaching significance as heralding era of constitutional advance with peace and progress, closer association of official and non-official agencies, and more intimate union of Hindu and Muslim efforts in common cause of well-ordered development of Province.
    General.—The chief event of the week has been the declaration of the All-India Congress Working Committee as unlawful association under the Criminal Law Amendment Act. The Committee consists, at full strength, of about 15 persons. For a considerable period they have been playing a prominent part in organising and directing the civil disobedience movement. Not only have they passed a number of resolutions urging the public to defy the law and to refuse payment of taxes, but they have circulated widely an incitement to the troops and the police to fail in their duty in dealing with the Civil Disobedience Movement. Simultaneously with the notification of the Committee, the President, Pandit Moti Lal Nehru, and the secretary, were arrested, and were subsequently sentenced to six months' simple imprisonment each. Following on this action there were hartals in various towns, but many of them were incomplete and there have been no clashes between the authorities and the public. Popular demonstrations have been most marked in Bombay City, where conditions continue to be unsatisfactory, and the mill-hands suspended work for two days. The day before the Committee was notified a meeting was held, the results of which have now been reported in the Press. A number of resolutions were passed, the general sense of which was to urge the continuance of the Civil Disobedience Movement with increasing vigour. The Committee confirmed the resolution inciting the troops

    9
    and police to fail in their duty, reference to which has been made above, and they urged all Congress organisations to give the widest publicity to it, in spite of the fact that the resolution had been proscribed under the Criminal Law.
    During the week the Governor-General promulgated an ordinance for the purpose of controlling effectively the seditious bulletins and news sheets which, since the issue of the Press Ordinance, have been published in many places in deliberate defiance of the law. These bulletins consist largely of falsehoods and misrepresentations, and their object is to stir up racial and anti-Government feelings. In spite of the vigorous activities of the Congress, the situation shows distinct signs of improvement in several directions, as already noted. The position on the frontier is rapidly returning to normal. In parts of Gujerat there are indications that the movement is losing some of its vigour, and most of the Provinces report a slackening of effort. The conviction that the Civil Disobedience Movement cannot succeed is growing, and commercial and industrial circles are showing increasing concern regarding the dangerous consequences of its continuance. There is an increase in constructive effort towards a constitutional solution of political problems, and Muhammadans, in particular, are devoting much thought and attention to the presentation of their case at the London Conference. While the situation, therefore, has still many unstable elements, these are not so numerous or so pro nounced as a few weeks ago.

    INQUIRIES (REPORTS).
    Mr. MARLEYasked the Secretary of State for India whether he has received the report of the Sisganj Firing Inquiry Committee, appointed by the Shiromani Gurdwara Parbandak Committee to inquire into incidents connected with the hartal in Delhi on 6th May, 1930; and, if so, whether he proposes to take any action in the matter?
    Mr. BENN: I have not received a copy of the report, but I can assure my hon. Friend that the matter is receiving careful consideration by the Government of India. My hon. Friend will no doubt have seen in the "Times" of 1st July an account of the recent deputation from
    10
    the Sikh Community to the Viceroy. This deputation raised the matter of the Delhi incident and their representations received a sympathetic hearing.
    Mr. MARLEYasked the Secretary of State for India whether he has received the report of the committee appointed by Mahajana Sagha in Madras to inquire into happenings in Madras on 23rd and 25th April, 1930; and, if so, whether the report will be made available for Members of this House?
    Mr. BENN: No, Sir, I have not received the report.

    GRAZING FEES.
    Mr. MARLEYasked the Secretary of State for India whether he will cause inquiry to be made as to how far the Instruction of Forest. Manual, Vol. II, that grazing is not to be looked upon in India primarily as a source of income, is being carried out; and whether grazing fees have now been reduced to their original level?
    Mr. BENN: Yes, Sir, I will have inquiry made.
    Mr. MARLEY: Will the right hon. Gentleman see that these fees are reduced to a level which will allow the peasants to use the various lands conveniently and without great expense?
    Mr. BENN: My first step is to make inquiries.

    REPRESSIVE LAWS COMMITTEE (REPORT).
    Mr. SORENSENasked the Secretary of State for India whether the Government of India have considered the report of the Repressive Laws Committee, 1922; and, if so, whether it is proposed to take action with a view to carrying out the recommendations of the Committee, with special reference to the Bombay Ordinance of 1827?
    Mr. BENN: I would refer my hon. Friend to the reply given to a similar question by ray hon. and gallant Friend the Member for Southern Derbyshire (Major Pole) on 9th December, 1929, of which I will send him a copy. No action as regards the Bombay Regulation of 1827 is contemplated at the present time.

    POLICE PAY.
    Mr. MARJORIBANKSasked the can Secretary of State for India whether he state the rates of pay of the police in the several provinces of British India?

    PAY OF POLICE IN INDIA

    (Rs. per mensem).

    Grade.

    District Police.

    City Police.

    Madras

    Bombay.

    Bengal.

    Punjab.

    Burma.

    Bihar and Orissa.

    Assam.

    Madras.

    Bombay.

    Calcutta (Maxima).

    Rangoon.

    Constables.

    16½–22

    20–24

    20–21

    17–20

    30 (average).

    15–20

    16–20

    22–30

    30–36

    30

    30–38

    Head Constables.

    26–35

    28–60

    28–40

    30–42

    40–45

    25–35

    25–40

    35–42

    38–50

    —

    45–55

    Sergeants

    150–200

    150–200

    175–225

    150–200

    —

    —

    130–175

    —

    200–250

    250

    210–250

    Sub-Inspectors.

    60–125

    75–160

    50–130

    80–160

    75–135

    80–130

    80–130

    85–150

    125–200

    200

    95–155

    Inspectors.

    175–275

    180–400

    175–300

    180–300

    175–295

    175–300

    175–300

    175–325

    300–400

    350

    250–350

  BRITISH TRAWLER (ARREST, ICELANDIC WATERS).
  Lieut.-Commander KENWORTHYasked the Secretary of State for Foreign Affairs whether he has now received a report of the arrest and fining of the Hull trawler "Commander Evans" by the Icelandic authorities, when the skipper was fined the equivalent of £568 and the catch and gear valued at £275 confiscated; if he is aware that even if the limits of territorial waters were infringed it was undoubtedly accidental, as the trawler was openly fishing for some time in broad daylight within sight of the Icelandic gunboat without receiving any warning: and whether he will take steps to obtain a reduction of this penalty?
  The SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Arthur Henderson): I am continuing my inquiries into this case, and I hope to be able to communicate the result shortly.

  GENEVA OPIUM CONVENTION.
  Mr. DAYasked the Secretary of State for Foreign Affairs whether there are any member States of the League of Nations who have not ratified the Geneva Opium Convention; and will he give particulars?
  Mr. A. HENDERSON: The members of the League of Nations who are not
  Mr. BENN: I will circulate a table giving such information as I possess.
  Following is the table:
  parties to the Geneva Opium Convention number 24. Of these, nine have either signed or acceded to the Convention, subject, however, to ratification or confirmation. The remaining 15 have neither signed nor acceded. I will, with my hon. Friend's permission, circulate details in the OFFICIAL REPORT.
  Mr. DAY: Can the Foreign Secretary say if those who have acceded have acceded without qualifications?
  Mr. HENDERSON: I must have notice of that question.
  Following are the details:
  Member States whose signatures or accessions await perfection by ratification:

  Albania.

  Irish Free State.

  Bolivia.

  Nicaragua.

  Chile.

  Persia.

  Cuba.

  Uruguay.

  Hungary.

  Member States which have neither signed nor ratified nor acceded to the Convention:

  Abyssinia.

  Liberia.

  Argentine Republic.

  Lithuania.

  China.

  Norway.

  Colombia

  Panama.

  Estonia.

  Paraguay.

  Guatemala.

  Peru.

  Haiti.

  Sweden.

  Honduras.

  RUSSIA.

    DEBTS (CLAIMS AND COUNTERCLAIMS).
    Captain PETER MACDONALDasked the Secretary of State for Foreign Affairs whether he has received any intimation from the Soviet Government as to the composition of the delegation to negotiate on claims and counterclaims; if so, whether he will state the names of the Soviet delegates as well as the British delegates; and what the terms of reference of the committee of investigation are to be?
    Sir NICHOLAS GRATTAN-DOYLEasked the Secretary of State for Foreign Affairs whether he can state the names of the British members of the joint committee to negotiate with the Soviet representatives on claims and counterclaims?
    Mr. A. HENDERSON: May I ask the hon. Members to be so kind as to repeat their questions on Monday next?
    Sir N. GRATTAN-DOYLE: Is the right hon. Gentleman not aware that this is the third occasion upon which he has postponed his answer to this question, and is it not sufficiently important to give it his special attention?
    Mr. SPEAKER: The answer was to ask for a, postponement.
    Sir WILLIAM DAVISONasked the Secretary of State for Foreign Affairs whether he can assure the House that it is not proposed to guarantee any loan to the Russian Soviet Government connection with the negotiations for the payment of debts due to British nationals?
    Mr. HENDERSON: Yes, Sir. I gave an assurance in this sense in my reply to the hon. Member for Farnham (Mr. A. M. Samuel) on the 27th of January last, since when there has been no change in the policy of His Majesty's Government.
    Mr. ARTHUR MICHAEL SAMUEL: How does the right hon. Gentleman reconcile that statement with the fact that His Majesty's Government are now guaranteeing the credit of the Soviet Trade Delegation?

    PROPAGANDA.
    Sir W. DAVISONasked the Secretary of State for Foreign Affairs whether he has now any information as to the transfer of the Western European
    14
    Bureau of the Third Communist International from Berlin to London, and as to the reasons for this transfer?
    The UNDER-SECRETARY of STATE for the HOME DEPARTMENT (Mr. Short): I have been asked to reply. I would refer the hon. Member to the reply which my right hon. Friend gave on the 5th June to a similar question by the hon. and gallant Member for the Waterloo Division (Captain Bullock).
    Sir W. DAVISON: low is it that the British Government have no further information on this matter, considering that it is common knowledge in Berlin? Are their means of ascertaining facts not equal to those of foreign Governments?
    Mr. SHORT: My right hon. Friend said on Wednesday that there was no information which supported this rumour.
    Lieut.-Colonel Sir FREDERICK HALL: Are we to assume that there is no truth in the rumour?
    Mr. SHORT: We have no information.
    HON. MEMBERS: Are you trying to get it?

    FORCED LABOUR.
    Mr. MARJORIBANKSasked the Secretary of State for Foreign Affairs whether he has yet anything to report as a result of his inquiries with regard to forced labour in Russia?
    Mr. A. HENDERSON: Yes, Sir. Article 9 of the Constitution of Soviet Russia imposes the duty of labour on all its citizens, but compulsory unpaid labour of whatever nature is illegal. Forced labour may be imposed by judicial and administrative organs as a punishment for crime or misdemeanour, and, in addition, labour may be mobilised far special national emergencies (e.g., earthquakes, floods, etc.). As regards the timber industry, provincial communities are empowered by a decree of the 13th February last to employ compulsory labour at special rates of pay where the fulfilment of a production programme calls for such action.
    Mr. MARJORIBANKS: Is the right hon. Gentleman aware that an official Soviet organ, namely, "Trud," has described this practice as akin to slavery for Soviet citizens; and will he take

    15
    steps to prevent the products of this labour coming into this country and displacing British labour?
    Mr. HENDERSON: That is an entirely different question, which does not arise out of the question on the Paper.
    Mr. THURTLE: Has my right hon. Friend received any inquiries from Russia as to the conditions of forced labour in Kenya Colony?
    Sir KINGSLEY WOOD: Will the right hon. Gentleman consult the American Ambassador as to the steps which have been taken by the United States?

  GOVERNMENT DEPARTMENTS.

    FOREIGN OFFICE (PASSPORT DEPARTMENT).
    Mr. GRAHAM WHITEasked the Secretary of State for Foreign Affairs the number of persons at present employed in the Passport Department of the Foreign Office?
    Mr. A. HENDERSON: The number of persons employed in the Passport Office varies in proportion to the volume of work at different seasons of the year, and the month of July is always the heaviest. On the 1st July the total number of persons, including messengers, employed in the London Passport Office was 255, of whom 101 were persons temporarily engaged for the busy season. At the Liverpool Branch Office the number, on the 1st July, was 42, of whom 16 were similarly temporarily employed.

    OVERSEAS TRADE DEPARTMENT (INDIA).
    Sir N. GRATTAN-DOYLEasked the Secretary to the Overseas Trade Department whether, having regard to the importance to British industry of trade with India, he will consider increasing the organisation of his Department in the country?
    Mr. GILLETT (Secretary, Overseas Trade Department): The question of increasing my Department's organisation in India was very carefully considered at the end of last year, in connection with the general scheme for the expansion of the Department's Overseas Services. As at present advised, I cannot accept any suggestion that the Department's organisation in India is inadequate, but,
    16
    if the hon. Member wishes to make representation to me on the subject, I shall, of course, be happy to hear his views.
    Sir N. GRATTAN-DOYLE: Is the hon. Gentleman satisfied that the organisation at his disposal is sufficient to cope with the strain that has been put upon it, and will be put upon it in the future?
    Mr. GILLETT: I am afraid I cannot add anything to the answer which I have just given. The matter received very careful consideration a little time ago. If the hon. Member has any point that he would like to make to me, I shall be very glad to hear it.

    NEW BUILDINGS, EDINBURGH.
    Mr. MATHERSasked the First Commissioner of Works the present position with regard to the erection of Government buildings upon the Calton gaol site, Edinburgh; and whether agreement has been reached with the Corporation of Edinburgh as to the design of the buildings?
    The FIRST COMMISSIONER of WORKS (Mr. Lansbury): As the result of a conference held at Edinburgh recently with representatives of the City Corporation, the Town Planning Committee and the National Library Trustees, agreement was reached as regards the erection of the Sheriff Court House on the Calton gaol site subject to a reference to the Scottish Fine Art Commission on the siting of the building. The question of the erection of a departmental building on that site is still under consideration. The answer to the latter part of the question is in the negative.

  EGYPT.
  Mr. WARDLAW-MILNEasked the Secretary of State for Foreign Affairs whether he has received a letter from the British Union in Egypt drawing attention to the necessity of supporting the present British High Commissioner by an advisory council of British subjects who have real knowledge of Egypt, and pressing the importance of making it known in Egypt that any new negotiations with the object of concluding an agreement, must be started with a clean slate, and that this country is in no way committed by the negotiations which have

  17
  recently taken place; and what action he is taking in connection with these proposals?
  Mr. A. HENDERSON: A letter addressed to the Prime Minister on the 7th June contained suggestions of the nature indicated. The position of His Majesty's Government in regard to the resumption of negotiations for an Anglo-Egyptian settlement was defined in reply to a question by the hon. and gallant Member for Chelmsford (Colonel Howard-Bury) on the 30th June. His Majesty's Government do not consider that the task of British representatives abroad in general, and of the High Commissioner in Egypt in particular, in interpreting the policy of His Majesty's Government to the Governments to which they are accredited, would be facilitated by the existence of advisory councils, as suggested in the question. His Majesty's representatives naturally make it their business to apprise His Majesty's Government of the views of the local British communities on questions in which their interests are involved.
  Mr. WARDLAW-MILNE: Has the right hon. Gentleman's attention been called by his representatives in Egypt to the fact that there is a general idea in Egypt that negotiations can start at the point at which they left off when the representatives of Egypt left this country?
  Mr. HENDERSON: That is an entirely different question of which I must have notice.
  Colonel HOWARD-BURY: With regard to the last part of the question, may I ask whether the right hon. Gentleman is taking any action to carry out these proposals, as has been done unofficially in the past?

  TRADE AND COMMERCE.

    PORTUGUESE PORTS (FLAG DISCRIMINATION).
    Lieut.-Colonel Sir A. LAMBERT WARDasked the Secretary of State for Foreign Affairs whether any further communication has been received from the Portuguese Government on the subject of the continued discrimination against British shipping?
    Mr. A. HENDERSON: No, Sir.
    Sir A. LAMBERT WARDasked the Secretary of State for Foreign Affairs whether, in the event of the Portuguese Government continuing to discriminate against British shipping; he will consider the advisability of denouncing the Anglo-Portuguese commercial treaty of 1914?
    Mr. HENDERSON: As I informed the hon. and gallant Member on the 23rd June, His Majesty's Government have received an assurance from the Portuguese Government that they are considering the whole question of flag discrimination. Consequently, I do not consider that any advantage would be gained by discussing what action His Majesty's Government might have to take in hypothetical circumstances.
    Sir A. LAMBERT WARD: Is the right hon. Gentleman aware that the present action of the Portuguese Government is directly contrary to the terms of this treaty, and does he really think that it is any use continuing a treaty when one of the contracting parties refuses to abide by its terms?
    Mr. HENDERSON: I am afraid I have nothing to add.

    FRENCH WEST AFRICA.
    Captain CROOKSHANKasked the Secretary to the Overseas Trade Department whether he receives regular trade reports from our Consular representatives in French West Africa; and, if so, whether he proposes to publish any regarding the present state of the countries concerned?
    Mr. GILLETT: Trade reports are received from time to time from British Consular representatives in French West Africa. Two such reports upon general commercial conditions have recently been received, and consideration is now being given to the best means of bringing them to the notice of British firms.

    EXPORT CREDITS (TEXTILES).
    Mr. SORENSENasked the Secretary to the Overseas Trade Department whether he can extend the export credits scheme to cover the export of textile and soft goods to Ceylon and the East?
    Mr. GILLETT: The decision to exclude textiles, so far as certain Eastern and Far Eastern markets are concerned, was made at the request of the Manchester and Bradford Chambers of Commerce

    19
    and after consultation with the Eastern banks. In the absence of any information that the views of these bodies have changed, I do not propose to modify the existing arrangements.
    Mr. SORENSEN: Has my hon. Friend received any complaints from traders in this country pointing out the restriction that is placed upon trade with the East in this fashion?
    Mr. GILLETT: I believe that one letter was received recently, but that is the only thing of which I am aware in the nature of a complaint.

    ENGINEERING INDUSTRY.
    Sir K. WOODasked the Prime Minister whether he proposes to grant the request of the national engineering and other unions recently made to him for an official inquiry into the engineering industry on the lines followed in connection with the cotton, iron and steel trades investigation?
    The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. W. R. Smith): The request is under consideration. A deputation from the trade

    The following table shows the total declared value and quantity of the undermentioned descriptions of Cotton Manufactures of United Kingdom manufacture, exported from this country and registered as consigned to British India during the five months ended 31st May, 1929 and 1930, together with the percentage increase or decrease in 1930 as compared with 1929.

    Description.

    January to May.

    Increase (+) or decrease (-) 1930 compared with 1929.

    1929.

    1930.

    Cotton Yarns:

    £

    £

    Per cent.

    Grey, Unbleached

    …

    …

    …

    …

    780,223

    370,633

    (-) 52·5

    Bleached and Dyed

    …

    …

    …

    …

    352,184

    271,537

    (-) 22·9

    Total Cotton Yarns

    …

    …

    1,132,407

    642,170

    (-) 43·3

    Cotton Piece Goods:

    Grey, Unbleached

    …

    …

    …

    …

    4,472,864

    3,163,936

    (-) 29·3

    White, Bleached

    …

    …

    …

    …

    4,805,344

    3,853,693

    (-) 19·8

    Printed

    …

    …

    …

    …

    …

    …

    1,531,066

    1,183,904

    (-) 22·7

    Dyed in the Piece

    …

    …

    …

    …

    1,721,097

    1,424,918

    (-) 17·2

    Manufactures, wholly or in part of dyed yarn, commonly known as coloured cottons

    146,828

    205,654

    (+) 40·1

    Total Cotton Piece Goods

    …

    12,677,199

    9,832,105

    (-) 22·4

    Cotton Finished Thread

    …

    …

    …

    228,875

    211,417

    (-) 7·6

    Total of above

    …

    …

    …

    14,038,481

    10,685,692

    (-) 23·9

    unions on the subject was received a, few days ago by members of His Majesty's Government.
    Sir K. WOOD: When is the answer likely to be given?
    Mr. SMITH: I could not say.

    COTTON EXPORTS (INDIA).
    Major POLE (for Mr. FREEMAN)asked the President of the Board of Trade whether he can give any figures, both in total and percentage, showing details of the decrease in the cotton trade with India this year compared with 1929?
    Mr. W. R. SMITH: The exports of cotton piece goods of United Kingdom manufacture registered as consigned to British India during the first five months of 1930 amounted to 552,777,100 square yards as compared with 665,239,500 square yards during the corresponding period of 1929, or a decrease of 16.9 per cent. These exports amount in value to more than 90 per cent. of the total exports of cotton yarns and manufactures to India. I will circulate a detailed table in the OFFICIAL REPORT.
    Following is the table:

    21

    Total Quantities.

    —

    January to May.

    Increase (+) or decrease (-) 1930 compared with 1929.

    1929.

    1930.

    lbs.

    lbs.

    Per cent.

    Total Cotton Yarns

    …

    …

    …

    …

    10,300,100

    6,698,700

    (-)35·0

    sq. yds.

    sq. yds.

    Total Cotton Piece-goods

    …

    …

    …

    665,239,500

    552,777,100

    (-)16·9

    lbs.

    lbs.

    Total Cotton Finishfd Thread

    …

    …

    …

    775,266

    706,954

    (-) 8·8

  NAVAL AND MILITARY PENSIONS AND GRANTS.

    DISABILITY PENSIONS (F. C. COLMAN).
    Mr. JOWETTasked the Minister of Pensions whether he will inquire into the case of F. C. Colman, ex-driver 21,729, Army Service Corps, who was discharged from the Army in July, 1918, suffering from duodenal ulcer, for which disability he was pensioned on the ground that his disability had been aggravated by war service, the pension being discontinued in November, 1921, consequent on a decision, after medical examination, that aggravation had passed away; and whether, having regard to the medical certificate recently submitted to him, which states that F. C. Colman is still suffering from duodenal ulceration, although he was operated on three years ago for duodenal ulcer, he will reconsider his decision that aggravation had passed away?
    The MINISTER of PENSIONS (Mr. F. O. Roberts): Mr. Colman's case has been fully reviewed, but the medical certificate referred to relates, not to the present time, but to the man's condition eight years ago and prior to the decision of the independent Pensions Appeal Tribunal in the case. In the circumstances, as I have already informed my right hon. Friend, there are no grounds on which I should be justified in continuing further action.
    Mr. JOWETT: In view of the contradictory medical evidence on a point which cannot be established with certainty, will not my right hon. Friend give the benefit of the doubt to the poor claimant?
    Mr. ROBERTS: This certificate, as I have said, is dated eight years ago. That is the latest information that I have on the matter.

    COMMUTATION AND MIGRATION.
    Major LEIGHTONasked the Minister of Pensions the number of pensioners who have commuted a portion of their pension during the past two years for the purpose of migration to British Dominions or Colonies, and the average age of such pensioners?
    Mr. ROBERTS: The total number of cases during the past two years in which a portion of the pension has been commuted for the purpose mentioned is 16. No record is available as to the average age of these cases.
    Major LEIGHTON: Can the right hors. Gentleman say if they were under 50 or over 50?
    Mr. ROBERTS: I understand that no record is kept.
    Sir F. HALL: Will the right hon. Gentleman bear in mind the inadvisability of commuting in any of these cases save in exceptional circumstances, unless the whole pension has been granted?

    FINAL AWARDS.
    Mr. STEPHENasked the Minister of Pensions the number of awards which were granted under the procedure for the revision of final awards during the first three months of 1929 and 1930, respectively; and the total number of pensions granted since June, 1929, to the latest available date and the corresponding figure for the previous year?
    Mr. ROBERTS: The number of final awards dealt with under the procedure

    23
    referred to during the first quarter of 1929 was 237, and the number during the corresponding quarter of the present year was 558. The total number of pensions of all classes awarded to officers and men, widows and dependants during the 12 months ended 30th June, 1929, was approximately 3,450, and during the year ended 30th June last 3,500.
    Mr. STEPHEN: Is the Minister aware that there is great discontent in connection with these pensions, and is he not prepared to revise the Royal Warrant?
    Mr. ROBERTS: I am afraid I could not go beyond the answer that I have given to the question on the Paper.

    DEPENDANTS' PENSIONS.
    Miss PICTON-TURBERVILLasked the Minister of Pensions whether, in view of the public demand for an extension of the Royal Warrants to cover the dependants of those men who die of war injuries received prior to marriage, and the hardship now inflicted on the widows and children of the men who die as a result of war injuries, he will consider introducing the necessary measure?
    Mr. ROBERTS: I am not aware of any public demand in this matter. In any event I am unable to adopt the course suggested for the reasons stated in the reply which I gave to the hon. Member for Windsor (Mr. A. Somerville) on the 17th April last, of which I am sending my hon. Friend a copy.
    Miss PICTON-TURBERVILL: Is the Minister of Pensions aware that in the United States, in Germany, in Belgium and in France this grant is provided for widows of officers and men of the ranks?
    Lieut.-Colonel HENEAGE: Has the right hon. Gentleman's attention been called to the pledges of the Labour Government at the last election?
    Mr. STEPHEN: Will the right hon. Gentleman consider setting up a Commission to inquire into the grievances of these people?

  LONDON NAVAL TREATY.
  Commander SOUTHBYasked the Prime Minister whether the 91,000 ton cruiser tonnage limit was fixed before the
  24
  Naval Conference met in London; and, if so, by whom was it fixed and where?
  The PRIME MINISTER (Mr. Ramsay MacDonald): At the time of the preliminary negotiations, which took place in August and September last, with the United States of America, the question of cruiser replacement was considered by the Admiralty, and a figure of 91,000 tons was put forward for the new tonnage to be completed by the end of 1936. This figure was employed in the ensuing conversations which had for their object the removal of the earlier difficulties in regard to cruiser limitation. I have frequently explained that these preliminary conversations were for the purpose only of clearing the ground, prior to the London Naval Conference. The conclusion of a fixed agreement, independently of other interested Powers, was then neither attempted nor desired. The figure of 91,000 tons were finally fixed during the Conference itself, when, after negotiation with the United States of America and Japan, it was found that it met our replacement requirements within the terms of the Treaty.
  Commander SOUTHBY: Is the House to understand that this figure was decided upon in the preliminary negotiations with the United States without it having been discussed with the Japanese Government?
  The PRIME MINISTER: It was not decided upon in the preliminary negotiations at all. It was used as a figure for the purpose of considering upon what basis we might come to a Treaty when the London Naval Conference met.
  Commander SOUTHBY: Is the House to understand that the right hon. Gentleman is not in agreement with the very definite statement of the Lord President of the Council on the subject?
  Commander SOUTHBYasked the Prime Minister whether it is the intention of the Government to review the whole Empire naval building programme during the forthcoming Imperial Conference, including the question of revision of the tonnage limitations as laid down in the London Naval Treaty?
  The PRIME MINISTER: The forthcoming Imperial Conference may well afford a convenient opportunity for a discussion of naval building programmes in

  25
  the light of the London Naval Treaty, but it is not possible to specify any particular aspects of the Treaty which it may be thought desirable to consider in the course of any such discussion.
  Commander SOUTHBY: Will the right hon. Gentleman consider putting down on the agenda of the forthcoming Conference the definite question of discussing the Treaty limitations of tonnage when the Treaty lapses in 1935?
  The PRIME MINISTER: That is a point that can be raised by any Dominion that is interested in the subject. We have already had full negotiations and communications with them on the subject of the Treaty after the Conference itself.
  Commander SOUTHBY: Will the right hon. Gentleman take steps to initiate discussion on the subject—not leave it to the Dominions, but himself bring it forward from the English point of view?
  Mr. MACQUISTEN: Should not we have had the Imperial Conference first and the Naval Treaty second?
  Captain CROOKSHANKasked the Prime Minister on what grounds the Government declined to receive a representative nominated by New Zealand at the recent Naval Conference; and whether there have been any other occasions, and, if so, what, when the Government in London has adopted a similar attitude with regard to nominated representatives of any Dominion Government?
  The PRIME MINISTER: The hon. and gallant Member would appear to be under a misapprehension. There never was, nor could there have been, any question of the Government here declining to receive a representative who had been nominated by New Zealand to the London Naval Conference. The last part of the question does not arise.
  Captain CROOKSHANK: Does the right hon. Gentleman mean to say that Lord Jellicoe's statement in another place was quite incorrect?
  The PRIME MINISTER: No, I do not.
  Captain CROOKSHANK: What does the right hon. Gentleman mean?
  Earl WINTERTON: Does the right hon. Gentleman accept the statement that has been made that representations were
  26
  made by the Secretary of State for the Dominions to Lord Jellicoe on the subject?
  Rear-Admiral BEAMISHasked the Prime Minister the scope of any legislation that will be necessary in consequence of the terms of the Naval Treaty; and if, and when, it is the intention of the Government to introduce such legislation?
  The PRIME MINISTER: The London Naval Treaty of 1930, like the Treaty of Washington of 1922, prescribes certain restrictions as to the character of certain vessels of war which may be constructed within the jurisdiction of the High Contracting Parties. In order to be made effective, these restrictions require statutory authority, such as was given in 1922 by the Treaties of Washington Act. It will take the form of an amendment of the Treaties of Washington Act, and it is proposed also to take this opportunity to repeal Section 4 of that Act in which power was given to implement provisions of the Washington (Root) Treaty which never came into force and which in the light of the proceedings at the London Naval Conference may now be regarded as superseded altogether. That is with reference to submarines. The provisions to be repealed involved in particular jurisdiction over persons violating the Treaty in question. In the absence of ratification by all the High Contracting Parties such jurisdiction could not, of course, be exercised by our courts in conformity with international law, and it is desirable, to avoid all possibility of disputes arising at a subsequent date, to repeal the statutory provision for such jurisdiction. I cannot at present state precisely the date for the introduction of this legislation, but as I announced recently it is hoped to pass the Bill through all its stages before the end of the Session.
  Rear-Admiral BEAMISH: Is it necessary to ratify the Treaty before legislation is introduced, or vice versa?
  The PRIME MINISTER: It has been the custom that legislation of this kind should be passed before ratification, but I do not say it is anything more than a custom.
  Lieut. - Commander KENWORTHY: Will there be a new Clause to take the

  27
  place of the former Root Convention, including the new rules of submarine warfare?
  The PRIME MINISTER: I am afraid I cannot answer that question at the present moment, but there will be a provision in the Treaty annulling the legislation following the Washington Treaty which provided for observing the then Root Clause.
  Commander SOUTHBY: Would the right hon. Gentleman consider deferring the legislation until after the meeting of the Imperial Conference?
  The PRIME MINISTER: I do not think that is necessary. The Governments of the Dominions have agreed to the provisions of the Treaty.
  Mr. MARJORIBANKSasked the Prime Minister whether any of the Dominions asked for separate representation and advice at the London Naval Conference; and, if so, what answer was given?
  The PRIME MINISTER: All the Dominions were invited to be separately represented at the London Naval Conference and were informed that it was contemplated that the technical experts should be present at the Conference to assist the delegates in an advisory capacity. A similar communication as to technical experts was made to the foreign Governments. All the Dominions were represented by separate delegates and the delegates were accompanied by such expert advisers as the respective Governments thought desirable.
  Mr. MARJORIBANKS: Did not New Zealand ask Lord Jellicoe to represent them at the Conference?
  Mr. SPEAKER: That was put as a supplementary to a previous question.
  Earl WINTERTON: Was the right of the Dominions to choose their representatives free and unhampered so far as His Majesty's Government was concerned?
  The PRIME MINISTER: Representations regarding the Conference and the relations of the expert advisers to full delegates were made in common to the Dominions and to foreign Governments, and the concurrence was general.
  Mr. MARJORIBANKS: On a point of Order. If my memory serves me aright, the question I asked was not put as a supplementary. The question I asked was whether the statement of Lord Jellicoe in another place was correct. I now ask whether New Zealand asked for the representation of Lord Jellicoe?
  Mr. SPEAKER: I think that question has already been asked.

  WAGES.
  Major COLVILLEasked the Prime Minister if he has received from the Association of British Chambers of Commerce a resolution urging that the question of the relationship of the wages paid in sheltered occupations to those paid in competitive industries should be considered by the Economic Advisory Council; and whether he has agreed to adopt this suggestion?
  The PRIME MINISTER: The answer to the first part of the question is in the affirmative. I regret that I cannot, except on very special occasions, announce the subjects up-on which the Economic Advisory Council is asked to express opinions.
  Major COLVILLE: Does the right hon. Gentleman realise that the disparity in wages has definitely increased, and that the competitive trades cannot maintain even their present standard of wages unless they get Safeguarding conditions?
  Mr. A. M. SAMUEL: Does the right hon. Gentleman propose to ignore the effect on the export trades of the burden that the sheltered occupations impose?
  Mr. KIRKWOOD: Does the right hon. Gentleman understand that the only people with sheltered industries are those who toil not neither do they spin, yet Solomon in all his glory was not arrayed like one of these, and they are on the other side of the House?

  UNEMPLOYMENT.

    INSURANCE FUND.
    Major ELLIOTasked the Prime Minister whether it is intended to take any of the stages of the proposed Bill to extend the borrowing powers of the Unemployment

    29
    Insurance Fund this week; and whether he can state if it is the intention of the Government to propose that all the stages of this Bill be taken upon the Floor of this House?
    Sir ASSHETON POWNALLasked the Prime Minister when it is intended to introduce the Bill to increase the borrowing power of the Unemployment Insurance Fund?
    The PRIME MINISTER: This Bill will be introduced as soon as the necessary Money Resolution has been approved by the House. The Money Resolution will be taken as soon as possible, having regard to the claims of other urgent business, but not this week. Due notice of the Government's intention will be given in answer to the usual inquiries as to business made from time to time. It is proposed to take all stages of the Bill upon the Floor of this House.
    Major ELLIOT: Is it intended to borrow a large sum to run up to the end of the financial year and cover all contingencies?
    The PRIME MINISTER: The hon. and gallant Gentleman had better wait for the Financial Resolution.
    Mr. STEPHEN: Is this simply a Bill for the extension of borrowing powers or is it proposed to abolish the "not normally in suitable employment" condition?
    Mr. SPEAKER: The hon. Member had better put down a question.

    EXCHANGE, DARLINGTON.
    Mr. SHEPHERDasked the First Commissioner of Works whether he is yet in a position to say when the work on the new Employment Exchange at Darlington will be resumed?
    Mr. LANSBURY: Instructions have already been given for work to be resumed.

  AGRICULTURE.

    SUGAR BEET CULTIVATION.
    Mr. GRANVILLEasked the Minister of Agriculture the estimated number of agricultural workers engaged directly upon sugar-beet crops for the year ended 1929?
    The MINISTER of AGRICULTURE (Dr. Addison): I am afraid it is not possible to make a reliable estimate of the number of workers so engaged.

    LAND CULTIVATION (WALES).
    Dr. MORRIS-JONESasked the Minister of Agriculture the total acreage of land under cultivation in Wales on the last available date, as compared with the number of acres five years previously?
    Dr. ADDISON: The total area of arable land in Wales in 1929 and 1924 was 644,804 acres and 700,947 acres respectively. The area under permanent grass in 1929 amounted to 2,117,106 acres and in 1924 to 2,104,468 acres.
    Dr. MORRIS-JONES: In view of the totally different position of agriculture now compared with five years ago, will the right hon. Gentleman circulate the report of the Department, or make it available to the Members of this House?
    Dr. ADDISON: I will inquire into the matter, and, if the report is available, I will circulate it.

    MARKETING.
    Dr. MORRIS-JONESasked the Minister of Agriculture whether the Government contemplate introducing legislation to organise co-operative marketing boards in agriculture and to establish import boards to control the supply of wheat?
    Dr. ADDISON: The question of the formation and development of large-scale commodity marketing organisations is a, matter which is receiving consideration, but I am not at present in a position to make a statement on the subject.
    Lieut.-Colonel HENEAGE: Can the right hon. Gentleman say when he thinks that he will be able to make a statement on this subject?
    Dr. ADDISON: Very soon, I hope.
    Mr. LAMBERT: Can the right hon. Gentleman give an answer to the last part of the question, as to whether it is the intention of the Government to establish import boards to control the supply of wheat?
    Dr. ADDISON: The right hon. Gentleman should wait until the Government announces their policy.
    Dr. MORRIS-JONES: Are we to understand that the policy which was described by the hon. and gallant Gentleman the Member for Central Hull (Lieut.-Commander Kenworthy) as the official policy of the Government is not the policy of the Government?

    IMPORTED PRODUCE.
    Lieut.-Colonel RUGGLES-BRISEasked the Minister of Agriculture if he is aware of the decision of the German Government to impose a duty of £1 per quarter on malting barley imported from foreign countries; that the decision of the Czechoslovakian Government is to subsidise the export of barley from that country by an export bounty of 7s. 6d. per quarter; and whether, in view of the effect which these proposals will have on the market and price of English malting barley, he will take steps to safeguard the producer in this country?
    Dr. ADDISON: The rate of import duty on malting barley imported into Germany was raised to about 30s. per quarter of 448 lbs. as from 25th April last. The information at my disposal with regard to Czechoslovakia indicates that exporters of barley from that country will, under a law passed on 5th June last, be entitled to an import licence at the rate of about 7s. 6d. per quarter of 448 lbs. This law is not in operation at present, but it is expected to become effective when certain negotiations with the Hungarian Government are completed. With regard to the last part of the question, I have nothing to add at present to previous statements on the subject.

    POLICY.
    Captain P. MACDONALDasked the Minister of Agriculture whether it is his intention to make a comprehensive statement respecting the agricultural policy of the Government during the present Session?
    Dr. ADDISON: A statement on this subject will be made as soon as possible.
    Captain MACDONALD: Is it not a fact that every day for weeks past—[Interruption.]
    Mr. SPEAKER: That seems to be a matter for debate.

    WAGES, BRECONSHIRE AND RADNORSHIRE (PROSECUTIONS).
    Major POLE (for Mr. FREEMAN)asked the Minister of Agriculture the number of prosecutions which have taken place in Breconshire and Radnorshire during the last 12 months under the Agricultural Wages (Regulation) Act; the total amount of arrears of wages that have been recovered; and the largest individual amount obtained?
    Dr. ADDISON: During the 12 months ending 30th June, five farmers in Breconshire and Radnorshire have been prosecuted for paying wages at less than the minimum rates fixed under the Agricultural Wages (Regulation) Act, as a result of which arrears of wages amounting to £65 2s. 4d. have been ordered by the Courts to be paid. The largest amount ordered to be paid to an individual worker was £20.
    Mr. DAY: Can the right hon. Gentleman say whether there have been any prosecutions of farmers for not supplying the investigating officers with the information they require?
    Dr. ADDISON: I will inquire into that matter.

  FISHING INDUSTRY (INSURANCE).
  Captain P. MACDONALDasked the Minister of Agriculture whether he has under consideration the question of a comprehensive scheme of insurance for fishermen; and, if so, whether he can say when he will be in a position to make any statement of the Government's intentions?
  Dr. ADDISON: With two quite minor exceptions persons employed in the fishing industry are ordinarily insurable under the National Health and Pensions Scheme. With regard to unemployment insurance I have nothing to add to the reply given on the 3rd July by my right hon. Friend the Minister of Labour to my hon. Friend the Member for Berwick and Haddingtonshire (Mr. Sinkinson).
  Mr. WOMERSLEY: Can the right hon. Gentleman tell us what are these one or two minor exceptions?
  Dr. ADDISON: Yes, certainly. The case of share fishermen, where the catch

  33
  is divided in kind, is one exception, and the other exception is where the fisherman is over 65 years of age and was not an insured person on the 1st January, 1929.
  Major McKENZIE WOOD: Is the right hon. Gentleman taking any steps to inform himself as to the opinion of fishermen with regard to the possibility or advisability of their being included in the unemployment scheme?
  Dr. ADDISON: I have been in consultation with fishermen for four hours today.
  HON. MEMBERS: What, is the result?

  REGENT'S PARK (GATES).
  Lieut.-Colonel MOOREasked the First Commissioner of Works when it is proposed to replace the iron gates leading into Regent's Park which were removed during the War?
  Mr. LANSBURY: It is not proposed to replace the gates as no useful purpose would be served by doing so; they would, in fact, be a hindrance to traffic.
  Lieut.-Colonel MOORE: Can the right hon. Gentleman say what he proposes doing with those gates?
  Mr. LANSBURY: I expect that I shall leave them where my predecessor placed them.
  Lieut.-Colonel MOORE: Will the right hon. Gentleman say where that position is?
  Mr. LANSBURY: If the hon. and gallant Gentleman will give me until the morning, I will drop him a note.

  BOTANIC GARDENS.
  Lieut.-Colonel MOOREasked the First Commissioner of Works the proposals of his Department in regard to the future of the Botanic Gardens when the Crown lease falls in during 1932?
  Mr. LANSBURY: It is the intention of the Government that the ground shall be devoted to some purpose for the benefit of the public, but no decision has yet been arrived at as to the precise use to which it can be put.
  Lieut.-Colonel MOORE: Will the right hon. Gentleman be willing to receive any suggestions as to how that ground can be utilised?
  Mr. LANSBURY: We should be very glad indeed to receive suggestions.

  SOLICITORS (FRAUDULENT CONVERSION).
  Sir JOHN FERGUSONasked the Attorney-General if he has now been informed that the Law Society, conjointly with the provincial law societies, are initiating legislation designed to protect the public against losses by solicitors convicted of fraud in the criminal courts; and whether he has received a draft of a proposed Bill?
  The ATTORNEY-GENERAL (Sir William Jowitt): I have received a draft of a Bill which the Associated Provincial Law Societies at a meeting held on the 20th June last resolved to support. I understand that the general principles of the Bill were approved at the general meeting of the Law Society on Friday last, and that it is their intention to proceed with the Bill.
  Mr. ANNESLEY SOMERVILLE: Can the learned Attorney-General say when it is proposed to introduce the Bill?
  The ATTORNEY-GENERAL: There is obviously no time in the immediate future.
  Mr. SMITHERS: Will it receive Government support?

  MARRIED WOMEN'S PROPERTY ACT.
  Mr. DAYasked the Attorney-General whether the Government proposes to introduce in the near future legislation which will have as its object the amendment of the Married Women's Property Act, 1882?
  The ATTORNEY-GENERAL: I would refer the bon. Member to the answer I gave to a similar question addressed to me by the hon. Member for Wavertree (Mr. Tinne) on Thursday last, a copy of which I am sending to him.
  Mr. DAY: Does not my learned Friend think that, in view of the remarks which

  35
  were made by a learned judge last week, Parliament should give immediate attention to the matter?
  The ATTORNEY-GENERAL: I dealt with that matter in the answer to which I have referred.

  BRITISH ARMY (SUBVERSIVE PROPAGANDA).
  Sir K. WOODasked the Attorney-General (1) whether any proceedings have been taken against the publishers and printers of the pamphlets inciting soldiers to mutiny and recently distributed to young recruits at Brecon, and in respect of which two persons were convicted at the recent Brecon Assize, and, respectively, sentenced to 12 and eight months' imprisonment;
  (2) whether any proceedings have been taken against the publishers and printers of certain pamphlets inciting soldiers to mutiny and recently widely circulated throughout the Northern, Eastern and Western commands and distributed at Chatham, Aldershot, Yorkshire, Newcastle, Edinburgh and Wellington Barracks?
  The ATTORNEY-GENERAL: The only pamphlet which has been brought to my notice containing incitement to mutiny circulated to soldiers was contained in an envelope marked "Lee's Tip for the Derby," and I presume it is to this pamphlet my right hon. Friend refers. This pamphlet was of such a serious nature that it was my manifest duty to take proceedings against any person who could be shown to have been concerned with the printing, publication or distribution. In two cases only, Brecon and Aldershot, have we succeeded in discovering the distributors; in the other cases mentioned the pamphlet was left in proximity to the barracks, but no distributor was discovered. We have not succeeded in obtaining evidence as to the persons concerned in the printing or publication. As I have already stated in reply to the right hon. Gentleman, if I can obtain this evidence I should certainly prosecute.
  Sir K. WOOD: Apart altogether from the two pamphlets referred to, is it not
  36
  a fact that during the last 12 months there have been numerous prosecutions in relation to these matters?
  Sir LAMING WORTHINGTON-EVANS: Can the Attorney-General say whether the particular pamphlet to which he refers had not either an imprint on it or a statement on it that it was published by the Communist party?
  The ATTORNEY-GENERAL: No, it had no imprint at all, and we had no clue whatever as to the publishers or the printers.
  Sir L. WORTHINGTON-EVANS: Was it not stated that it was published by the Communist party?
  The ATTORNEY-GENERAL: There was no clue at all.
  Mr. SMITHERS: Can the Attorney-General say whether the issue of this pamphlet constitutes a breach of the Protocol of last October?

  TANGANYIKA (RAILWAY DEVELOPMENT).
  Mr. ORMSBY-GOREasked the Under-Secretary of State for the Colonies whether the committee set up by the Government of Tanganyika Territory, under the chairmanship of Sir Sydney Henn, is limited to selecting a route for the proposed south-western railway or whether it will be asked to advise on a road programme for the development of that part of the territory as well?
  The UNDER-SECRETARY of STATE for the COLONIES (Dr. Drummond Shiels): No information has been received from the Governor beyond that communicated to the right hon. Member in my answer of the 25th of June.
  Mr. ORMSBY-GORE: Will the hon. Member make representations to the Governor that in considering any railway programme in Tanganyika the vital question of main roads must be considered at the same time?
  Dr. SHIELS: Yes, Sir, I shall be very glad to do that.
  Mr. ORMSBY-GORE (for Sir PHILIP RICHARDSON)asked the Under-Secretary of State for the Colonies whether he is aware that, whilst British tenders for the construction of the new branch railway, Manyoni-Singida, and

  37
  diversions from the Central Tanganyika Railway line were below the cost estimated by the railway authorities, contracts have been given to foreigners, despite the fact that the money has been provided by the British Treasury; and will he take steps to ensure that preference is given to British manufacturers and contractors in all cases where British public funds are used for Colonial developments?
  Dr. SHIELS: The money for this railway is not being provided by the British Treasury, which is only granting assistance by way of payment of interest on loan, equivalent to about 11 per cent. of the cost of material, all of which is being obtained in this country. I have no information as to the local tenders for construction work, but it would not be in accordance with the principles of the Mandate to confine them to British subjects.

  IRAQ (TREATY).
  Mr. ORMSBY-GOREasked the Under-Secretary of State for the Colonies whether a new Treaty has been negotiated with the King of Iraq containing provisions for surrendering any use of the Hinaidi aerodrome by British military or civil aircraft: whether he will publish fall details regarding the proposed Treaty; and when the Treaty will be submitted to the Council of the League of Nations?
  Dr. SHIELS: The new Treaty with Iraq which was signed at Bagdad on the 30th June, provides for the withdrawal of the British Forces from Hinaidi aerodrome within a period of five years from the entry into force of the Treaty, which will take place upon the admission of Iraq to membership of the League of Nations. I should explain that this aerodrome is a military and not a civil aerodrome. The Treaty and connected documents will be printed and laid before Parliament as soon as possible after the definitive text has been received from Bagdad. Copies of the Treaty will also be communicated as soon as possible to members of the Council of the League of Nations.
  Mr. ORMSBY-GORE: Can the hon. Member say when it is proposed to ratify
  38
  the Treaty? Is it proposed to ratify the Treaty before it is discussed in this House?
  Dr. SHIELS: I shall require notice of that question.
  Lord STANLEYasked the Under-Secretary of State for the Colonies whether he is aware that the terms of the proposed Treaty with Iraq appeared in one newspaper 24 hours before the official announcement was made; and whether he intends to recommend that steps should be taken under the Official Secrets Act in this matter?
  Dr. SHIELS: The answer to both parts of the question is in the negative. Last Monday night a communiqué was issued in Bagdad reporting the signature of the new Treaty with Iraq and giving a resumé of its principal provisions. The text of the communiqué which it was proposed to issue had been telegraphed to London in advance. Upon the issue of the communiqué in Bagdad a news agency telegraphed home a summary, extracts from which, I understand, appeared in a number of papers on Tuesday morning. There were, however, several important omissions in this summary which was so condensed as to be liable to give a somewhat misleading impression in some particulars. It was therefore considered desirable to issue from the Colonial Office the complete text of the communiqué agreed upon by His Majesty's Government. This was done and the text appeared in certain papers on the following day.
  Brigadier - General CLIFTON BROWNasked the Under-Secretary of State for the Colonies whether a treaty has been concluded with Iraq; and, if so, what are the terms?
  Dr. SHIELS: Yes, Sir. A new Treaty with Iraq was signed at Bagdad on the 30th of June. The full text of the Treaty will be published as soon as possible.

  KENYA.
  Mr. STEPHENasked the Under-Secretary of State for the Colonies if he is aware that the Kenya Government has made rules prohibiting branches of the Kikuyu Central Association from

  39
  raising money from its members; and if he can state under what ordinance these rules were made?
  Dr. SHIELS: Orders were issued through the native authorities in Kenya early in the year to regulate the collection of money among natives in the Reserves. These orders were made under the Native Authority Ordinance. There is no intention to prevent the collection of money from natives for the Kikuyu Central Association or for any other purpose which is not unlawful; but it is considered desirable that provision should be made to ensure the giving of written receipts for money collected and the keeping and inspection of accounts of such money, and this will be effected by means of the orders.

  HOUSING (HEATING AND LIGHTING).
  Colonel HOWARD-BURYasked the Minister of Health whether he is aware that, since his attention was called to the action of the Barnsley Town Council in threatening with eviction tenants of municipal houses who have gas installed in their homes, the town councils of Dover and Wrexham are showing a similar hostile attitude towards the installation of gas in new housing estates; and whether he will take steps to ensure that tenants have freedom of choice regarding public services for heating and lighting in their homes?
  The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Miss Lawrence): No, Sir. My right hon. Friend has received no representations to the effect suggested. He will, however, be glad to consider any evidence which the hon. and gallant Member may have indicating that the councils in question are making an unreasonable use of their discretion in this matter.
  Colonel HOWARD-BURY: Is the hon. Member aware that in both cases the gas company is privately owned and that on one estate 95 per cent. of the tenants desire to have gas, but are prevented from having it because the electricity supply is municipally owned? Can the hon. lady take steps to see that these tenants are given freedom of choice?
  Miss LAWRENCE: My right hon. Friend will be glad to consider any evidence which the hon. and gallant Member may bring forward.

  ROYAL NAVY (MARRIAGE ALLOWANCES).
  Mr. HORE-BELISHAasked the First Lord of the Admiralty what is the nature of the inquiry that is proceeding into the question of the advisability of giving marriage allowances to naval officers?
  The PARLIAMENTARY SECRETARY to the ADMIRALTY (Mr. Ammon): I would refer the honourable Member to the reply given on the 2nd July (OFFICIAL. REPORT, Column 1945).
  Mr. HORE-BELISHA: The reason why I have put down this Question is because of the reply that I received on that date. What is the nature of the inquiry?
  Mr. AMMON: My right hon. Friend told the hon. Member, on the 2nd July, that there were many contingencies which must be considered, and that it would take a long time.
  Mr. HORE-BELISHA: Yes, but I am asking what is the nature of the inquiry. I have put that question on the Order Paper.
  Mr. AMMON: The inquiry is into the granting, or otherwise, of marriage allowances.
  Mr. HORE-BELISHA: I know that.
  Captain CROOKSHANK: Can the hon. Member say Who is making the inquiry? Is there a Committee, or is the hon. Member doing it himself?
  Mr. HORE-BELISHA: Can we have an answer? Is it a Departmental Committee?
  Mr. AMMON: The inquiry is by the Board of Admiralty.

  EX-ENEMY PROPERTY.
  Major NATHANasked the President of the Board of Trade whether it is the intention of His Majesty's Government to advise His Majesty in Council to make an order to vary the terms of

  41
  the Treaty of Peace Order, 1919, as amended, so as to incorporate the terms of the agreement between His Majesty's Government in the United Kingdom and the German Government in regard to the liquidation of German properties (Miscellaneous No. 3, 1930, White Paper Cmd. 3486)?
  Mr. W. R. SMITH: The question raised by the hon. and gallant Member has been considered, and I am advised that no amendment of the Treaty of Peace Order, 1919, is necessary in order to give effect to the Agreement in regard to the liquidation of German properties.

  EDUCATION (MAINTENANCE ALLOWANCES).
  Sir N. GRATTAN-DOYLEasked the President of the Board of Education whether he is in a position to make any statement as to the policy of the Government in connection with maintenance allowances for school children?
  Mr. D. G. SOMERVILLEasked the President of the Board of Education whether the Government proposals affecting maintenance allowances in the Education (School Attendance) Bill have undergone any change; if so, of what nature; whether the Measure when reintroduced, as promised, in the autumn will contain any changes in this respect; and, if so, of what nature?
  The PRESIDENT of the BOARD of EDUCATION (Sir Charles Trevelyan): The Government intend to make provision for the grant of maintenance allowances in respect of children during the time for which their period of school attendance is extended. Proposals as to the form and amount of the allowances, which will be brought forward in the autumn, are under consideration.

  METROPOLITAN POLICE (PROMOTION).
  Mr. HORE-BELISHAasked the Secretary of State for the Home Department whether promotion to the rank of sergeant in the Metropolitan police is, in the case of a constable who has passed his examination with credit, dependent on the recommendation of his superintendent; and, if the recommendation
  42
  should be refused, whether there is any means by which a constable can get this decision reviewed by the Commissioner or some intermediate officer?
  Mr. SHORT: The answer to the first part of the question is in the affirmative. With regard to the second part, any member of the force deeming himself aggrieved and desiring to make a representation to the Commissioner may at any time submit a complaint in writing.
  Mr. MARLEY: Is it possible for a constable to take the examination without the consent of his superior officer?
  Mr. SHORT: That question does not arise, but, if the hon. Member will put it on the Order Paper, I will give him an answer.

  TRANSPORT.

    LEVEL CROSSING, SUNNINGDALE.
    Mr. THURTLEasked the Minister of Transport whether he will enter into negotiations with the Surrey County Council and the Southern Railway Company with a view to bridging the level crossing at Sunningdale on the trunk road from London to Aldershot and Southampton, or building a new road which shall be free from this obstruction?
    The MINISTER of TRANSPORT (Mr. Herbert Morrison): The responsibility for the initiation of a scheme for bridging this level crossing rests primarily on the Surrey County Council. I am drawing their attention to my hon. Friend's question, and I am prepared to give careful consideration to any proposal which the council may submit.
    Captain WATERHOUSE: Will the hon. Member give us an assurance that any steel that is required will be of British origin?
    Mr. MORRISON: I hardly think that question immediately arises. I have no indication yet that the county council are going to build a bridge.

    MILESTONES.
    Sir A. LAMBERT WARDasked the Minister of Transport whether he will suggest to local authorities that all milestones which have to be moved to allow of the widening of roads should be replaced

    43
    as near the original site as possible, as many of these old stones are of considerable interest?
    Mr. HERBERT MORRISON: I share the desire of the hon. Member that old milestones removed in the course of road widening operations shall be replaced as near their original sites as possible. My experience is that local authorities usually adopt this course, and I do not think it necessary to address a formal communication to them on the subject.
    Sir A. LAMBERT WARD: Is the hon. Member aware that that is not being done in all cases, and would not a suggestion from, him have the desired effect?
    Mr. McSHANE: Can the hon. Member not place these stones where the First Commissioner's predecessor placed the gates?

    RIVER TAMAR (BRIDGE).
    Mr. HORE-BELISHAasked the Minister of Transport what are the reasons for the delay in the report of the engineer appointed to inquire into the construction of a bridge over the River Tamar?
    Mr. HERBERT MORRISON: There is no undue delay. I informed the hon. Member on the 2nd instant that I am expecting to receive the engineer's report during the course of this month, and I understand that it is to be submitted within the next few days.

  AFFORESTATION, SOUTH WALES.
  Mr. MILLS (for Mr. JENKINS)asked the Parliamentary Secretary to the Board of Trade, as representing the Forestry Commissioners, what progress has been made to secure land for afforestation in the Neath Valley, Dulais Valley, and Swansea Valley?
  Mr. W. R. SMITH: In these valleys the Forestry Commission have acquired 2,407 acres and are negotiating for the acquisition of a further 3,202 acres.
  Mr. MILLS (for Mr. JENKINS)asked the Parliamentary Secretary to the Board of Trade, as representing the Forestry Commissioners, how many acres of land have been taken in Glamorgan for afforestation and in what areas have
  44
  they been taken; how many acres have been planted in the last two years; and how many workmen have been employed?
  Mr. SMITH: 1,133 plantable acres have been acquired by the Forestry Commission at Llantrisant, 1,523 at Margam and 2,275 at Rheola. At those centres 750 acres were planted in the last two years; the number of persons employed varied from a minimum of 19 to a maximum of 74.

  QUESTIONS TO MINISTERS.
  Mr. A. SOMERVILLE: On a point of Order. The hon. Member for Shoreditch (Mr. Thurtle) on Question 32 asked a question in respect of forced labour in Kenya. There is no forced labour in Kenya—
  Hon. MEMBERS: "Order!"
  Mr. SPEAKER: That is not a point of Order.

BUSINESS OF THE HOUSE.
Mr. CHURCHILL: May I ask the Prime Minister, or the Chancellor of the Exchequer, or both, what ideas the Government have as to the progress we should make on the new Clauses of the Finance Bill to-day? I ask now in order to save the time which would be taken up by moving to report Progress when we reach the Committee stage.
The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden): I am much obliged to the right hon. Gentleman. Most of the new Clauses are somewhat in the nature of hardy annuals, and they appear in almost the precise form in which they have appeared on former occasions. They have been discussed at great length, and I really do not think they ought to occupy very much time. Towards the end of the new Clauses we come to some of greater importance, and I would suggest, and I hope the right hon. Gentleman will agree that we should get to-day the new Clause (applications by spouses for separate assessment to Income Tax or Surtax to have effect until revoked) in the name of the hon. and learned Member for Ealing (Sir H. Nield). Then follow the important new Clauses to which I have referred. The right hon. Member for Epping (Mr.

45
Churchill) expressed a wish the other day that the new Clauses to which he attached considerable importance should be moved in the light of day, and my suggestion is that we should start this new Clause next Wednesday. I understand there is an alteration in the programme of business, but I hope we may be able to begin the consideration of this Clause on Wednesday and probably dispose of the new Clauses by dinner time. I hope this suggested arrangement will commend itself to the Opposition.
Mr. CHURCHILL: It is perfectly clear that if we are to achieve anything of the kind sketched by the Chancellor of the Exchequer we shall have to make very rapid progress to-day. Although many of these new Clauses are hardy annuals they do not seem to get annually less hardy as the scale of taxation advances. As I understand it, the Government's intention is to give two days if necessary, including to-day, for the consideration of the new Clauses.
Mr. SNOWDEN: Not quite two days.
Mr. CHURCHILL: Of course, to-day is not a full day because there is an important Private Bill down for consideration about which there seems to be much interest, and we do not know how much time it will take. But with the best will in the world I think there will be grave difficulty to get through all this great mass of new Clauses by 12 o'clock to-night. It would be easy if we sat until one or two o'clock, but to do so by 12 o'clock seems to me somewhat difficult, and will depend largely on the time taken by the Private Bill. However, we all agree that the important new Clauses which come at the end of the business suggested by the Chancellor of the Exchequer should be brought to an issue on Wednesday at an early hour, and he may rely upon us to make every effort compatible with the decent discharge of public business to reach a condition whereby these new Clauses can be so considered. On this side of the House we have an additional new Clause which is not yet on the Paper to which we attach great importance. It is a Clause to make a closer conformity between the basis of assessment for Death Duties and the actual commercial value of the property assessed. We shall put that on the Paper, and it will come on after the
46
new Clauses have been dealt with. Therefore I doubt if we could undertake that the business will be disposed of on Wednesday before dinner. But we can do our best, and I am bound to say, having regard to the period which we have reached in the Session and the careful scrutiny already given to the Budget, that we might make a common endeavour to dispose completely of the Committee stage, including the Schedule, before 12 o'clock on Wednesday next.
Mr. BATEY: I would like to ask the Prime Minister whether we are to understand from that statement that the Lords Amendments to the Coal Mines Bill are not to be taken first on Wednesday?
The PRIME MINISTER: No. The announcement of business was that the Lords Amendments would be taken on Wednesday. That holds good.
Mr. CHURCHILL: Then on what date is the debate on the Committee stage of the Finance Bill to be resumed after to-day?
The PRIME MINISTER: We were proposing Wednesday, as the Chancellor of the Exchequer announced, and that the business should be cleared up by the dinner hour. Mat is the arrangement at the moment.
Mr. CHURCHILL: I see. Do not let us have any misunderstanding. We cannot be expected to associate ourselves with that arrangement.

SELECTION (STANDING COMMITTEES).

  STANDING COMMITTEE A.
  Mr. Frederick Hall reported from the Committee of Selection; That they had discharged the following Member from Standing Committee A: Mr. Rhys Davies; and had appointed in substitution: Mr. David Grenfell.
  Report to lie upon the Table.

PUBLIC WORKS FACILITIES BILL,
"to expedite the procedure for empowering local authorities and statutory undertakers to execute works which will contribute to the relief of unemployment; to facilitate the acquisition by such authorities and undertakers of land and easements

47
required for the purposes of their functions; and for purposes connected with the matters aforesaid," presented by Mr. Greenwood; supported by Mr. William Adamson, Mr. Hartshorn, Miss Bondfield, Mr. Herbert Morrison, and the Attorney-General; to be read a Second time To-morrow, and to be printed. [Bill 225.]

ORDERS OF THE DAY.

  FINANCE BILL.
  Further considered in Committee. [Progress, 3rd July.]
  [Mr. DUNNICO in the Chair.]

  FINANCE BILL.

    NEW CLAUSE.—(Income tax in the case of married persons.)
    If either husband or wife who are living together claims to be separately assessed for the purpose of Income Tax (which expression includes Surtax) neither of them shall be liable to pay a larger sum in respect of Income Tax than they would be liable to pay if they were each unmarried.—[Mr. G. Locker-Lampson.]
    Brought up, and read the First time.
    Mr. GODFREY LOCKER-LAMPSON: I beg to move, "That the Clause be read a Second time."
    This new Clause has been proposed for the last 12 or 13 years, but when moved in the past has been moved without avail. I venture once more to move the Second Reading of the Clause in the hope of persuading the Chancellor of the Exchequer to remove what, after all, seems to me to be a great injustice and a really ridiculous anomaly. As the Committee know, under the present law a man and woman may be living together unmarried, and in that case they are treated separately for the purpose of Income Tax; they do not pay according to the joint rate, but each of them pays an individual rate and each of them is assessed separately. As soon as they marry they pay on their joint incomes at a higher sate. In fact, to put it quite shortly, a very heavy tax is placed upon the legal marriage bond. No one else is treated in this way. If two sisters are keeping house together, or two brothers, or a father and son, or a mother and daughter, each of them is treated separately for the purpose of Income Tax and each pays his or her own rate. Why should the marriage bond be treated differently from any other kind of union in this respect? I do not believe that there is any valid argument in favour of it. Indeed it is much more serious now than it was a few years ago, because the tax is becoming heavier and heavier. In the days before the War, although the principle was exactly the same, the
    60
    result was comparatively slight, owing to taxation being much less; but now it is very serious indeed and may become much more serious.
    I will give the Committee two instances to show what it means. I will take quite low incomes, not the incomes of rich people. I have here the instance of a man and woman living together, not married. The man earns an income of £280 a year and the woman has an unearned income of £280 a year. Between them they pay a tax of £24 8s. But directly they marry, with exactly the same income, they pay a tax of £32 8s. 6d. Here is another instance of a man and woman living together unmarried. The man earns an income of £200 a year and the woman has an income of £200 unearned. They pay a tax of £10 4s. But directly they marry, with the same income, they will pay a tax of £14 4s. The majority report of the Royal Commission on the Income Tax in 1920—the present President of the Board of Trade was a distinguished member—used this argument in paragraph 259 in support of the existing practice:
    "The incomes are aggregated because the law of taxable capacity is the supreme law in matters of taxation, and taxable capacity is, in fact, found to depend upon the amount of the income that accrues to the married pair, and not upon the way in which that income happens fortuitously to be owned by members of the union."
    That may be a perfectly sound argument, but if it is a sound argument it applies equally to any other kind of income; it applies equally to the man and woman who are living together unmarried, to the joint household of a couple of sisters or of a couple of brothers, or of a father and son, or of a mother and daughter. If the argument is sound in one case, it is equally sound in the others. The present practice is against the whole of the recent history of women's enfranchisement. The Married Women's Property Act, passed in 1882, has always been considered to be the married women's charter. Before that Act was passed the property of a wife became the chattel of her husband. What does the women's charter say?
    "Every woman who marries after the commencement of this Act shall be entitled to have and hold as her separate property all the real and personal property which shall belong to her at the time of marriage, or shall be acquired by her after marriage."

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    4.0 p.m.
    No one ever dreamed that this principle would be called into question again. Unfortunately in 1918 a general rule was put forward in connection with the Finance Act of that year which violated this principle. The rule in 1918 laid it down that the profits of a married woman living with her husband should be deemed to be the profits of the husband, and should be assessed and charged in his name, and not in her name or in the name of her trustees. It is perfectly true that if the wife chooses to go out of her way to make a separate claim, she can get a separate assessment, but she has got to make the claim first. Many people are quite unaware of that, and, whether she makes a separate claim or not, the assessment is a joint assessment, in the sense that they have to pay on the joint amount, and this, of course, holds good except in very rare cases where both the incomes are earned and those incomes are very low. It does seem to me very curious that in the very year that the great Reform Bill was passed giving women the vote and enabling them to sit in this House, the other Act was passed which was a distinct violation of the Married Women's Property Act and took away what was given nearly 40 years previously.
    I should like, if I may, to anticipate some of the objections which, I presume, the Chancellor of the Exchequer is going to make. I think that he will find three arguments against this new Clause. The first argument will be based on the report of the Royal Commission of 1920; the second, possibly, on the argument that if he agrees to this Clause, it will lead to a great deal of evasion; and the third argument, probably, will be that the cost will be too great. I do not feel that the report of the Royal Commission ought to carry any weight to-day. On that Commission there were 26 Commissioners, and only one was a woman; 186 persons gave evidence, and only five of those were women. Only 11 gave evidence in regard to this marriage tax at all, and eight out of the 11 were in favour of its abolition. Three only were in favour of the marriage tax, and all those three were officials connected with the Inland Revenue Department. Out of five women who gave evidence, one was not asked any question about the marriage tax at all, but every one of the four women who
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    were questioned were in favour of the abolition of the tax. One of those ladies represented the National Council of Women of Great Britain and Ireland, another represented the National Union of Societies of Equal Citizenship, the third represented the Women's Freedom League, and the fourth member was the hon. Lady the Member for Sunderland (Dr. Phillips), who represented the Standing Joint Committee of Industrial Women's Organisations. The hon. Member for Sunderland in her evidence used these words:
    "We are of opinion that a husband and wife should not be placed with regard to the payment of Income Tax at a disadvantage in comparison with any other two persons living together."
    Later on in her evidence she said:
    "It puts two married people at a disadvantage compared with the rest of the community."
    I only hope that the hon. Lady the Member for Sunderland is still of that opinion, and that she will go into the Lobby in support of this Clause. More than this, Mrs. Knowles, who was the only woman member of the Commission who signed the Minority Report, strongly condemned the tax, and disagreed with the recommendations of the Majority Report of which the distinguished President of the Board of Trade was a member. Therefore, I do hope that the Chancellor of the Exchequer, if he is going to reply, will not adduce this report as a reason against this Clause. I do not think that it will strengthen his case. Women in those days were much less organised than they are to-day. They are far more powerful now, and no such Commission could possibly be set up to-day. To-day, women would have been far more strongly represented on the Commission, and their voices would have been heard in evidence far more fully.
    The next argument which, I think, possibly the Chancellor of the Exchequer will use is the argument of evasion, but exactly the same argument could be used in regard to people in other relationships of life living together and running a joint household. Does it lead to evasion when two sisters are living together, or two brothers, or a mother and a daughter or a father and a son? More important still, does it lead to evasion when two people are living together, a man and a woman, who are

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    unmarried? If it does lead to evasion, why does not the right hon. Gentleman now treat their incomes as joint and get the full tax; and if it does not lead to evasion, and there is no evasion, why is he afraid there is going to be evasion in the case of husband and wife? May I suggest to the Chancellor of the Exchequer that he could meet this case of evasion by the same means that he meets the case of evasion under the Death Duties? In the case of Death Duties, if property is handed over within a certain period of time, Death Duties have to be paid, and in the case of income of husband and wife, if property is handed over to escape the tax, that proportion of the property could, after a certain period, be considered as part of the income of the giver. I would like to know whether the Chancellor of the Exchequer has considered that.
    The last argument that the right hon. Gentleman may use is the argument of cost. I would like to point out that the heavier the cost, the heavier is the present burden and the heavier the injustice. The right hon. Gentleman may be going to tell us that if he accepts this Clause it will cost many millions of pounds. If he does, it is a very serious confession to make, for, in that event, marriage in this country is penalised to such a vast extent that it must necessarily have some effect in discouraging the legal bond. The cost of the removal of this injustice is the exact burden of the tax upon marriage at the present moment. Women to-day, as everyone knows, are more than half the electorate. Therefore, they wield, if they choose to exercise it, a greater political power in this country than the other sex. They can sit in this House on equal terms with men. They can vote on Finance Bills and tax their fellow-subjects. Numerous Acts have been passed during the last few years gradually placing them on practically a complete equality with the other sex in every department of life. Is it not ridiculous that directly they are married, the whole of their property is treated as the property of the husband for Income Tax purposes? Directly the legal bond becomes effective, the tax authorities treat the property of the wife as the property of the husband, and no longer consider it as her separate
    64
    property, unless she makes a special claim to be assessed separately, and then she has to pay increased tax. Would it not be far more in accordance with the spirit of the times to sweep away what, after all, is a gross anachronism, a relic of the inequality of women as citizens of this country?
    The PRESIDENT of the BOARD of TRADE (Mr. William Graham): My right hon. Friend who moved this Clause has pointed out that the subject is one which has been before this House in, I think, all the discussions on the Finance Bill in Committee in recent years, and he is also, of course, perfectly correct in directing attention to the conclusions of the Royal Commission on Income Tax, although I am not, quite sure that he has accurately represented the views of, at all events, a section of its membership. The reply to this proposal can be put in brief and simple terms. No doubt there are certain features in the case which has been presented by my right hon. Friend which are attractive, and it seems to be a logical development of the principle of the Married Women's Property Acts and kindred legislation that there should be a separation of the incomes of husband and wife if they so elect, and it is an option which is provided under this new Clause that the tax should be separately imposed. But when we come to make inquiries into what is meant in practice by this Clause, then the anomalies and injustices, not to mention the loss to the revenue, are of the most startling character, and the proposal altogether ignores one fundamental consideration which the Royal Commission had clearly in view. At the present time, we give an allowance in the assessment of husband and wife; there is a reduction in respect of their marriage. That is the way in which we recognise marriage under the law as it stands, but if it were proposed to segregate or separate the incomes, and carry that to its extreme conclusion in taxation, then, of course, that must be clearly an alternative to the existing marriage rates. My right hon. Friend seeks to get over that difficulty by making it an option under this Clause, but there is not the least doubt that while for a certain section of families in this country the option would be very valuable, it would be very damaging to the great majority.

    65
    Let us see what would happen. There is not the least doubt that very soon after this change had been introduced and the option exercised, income would be redistributed between husband and wife for the express purpose of reducing the aggregate amount of taxation now paid in that household, and the cost to the Exchequer, to begin with, would be at least £8,000,000, but as the taxpayers, who for this purpose include Surtax payers, redistributed the income, over the years—and it would be accomplished probably, in a very short time—the cost would mount up until, I am advised, it might amount to as much as £35,000,000. So that on revenue grounds alone, whatever point it might be between £8,000,000 and £35,000,000, the proposal is impossible. But what would be the effect upon the taxpayers themselves? After all, the real test in any system of taxation, more particularly if we regard the marriage bond as the normal thing in life, is the fair allocation of the burden of taxation over a community with reference to ability to pay.
    I am advised that the number of cases of joint incomes up to £1,000 in which that income really belongs to the husband or flows to the husband, and in which the wife has little or no income, is probably 2,000,000. That is to say, there are 2,000,000 cases of taxpayers or households in that condition in this country. If this change were introduced then, it follows clearly, that an additional burden would be placed upon that great body of taxpayers in order to give a reduction of tax to taxpayers over that amount who, again, would be more readily able than the others to redistribute their income for the purpose of taking advantage of this option. Therefore, the net result would be to inflict a grave hardship upon large numbers of taxpayers who have been held entitled to our consideration and have received our consideration in the past. I need not stress the point which the right hon. Gentleman himself remembered in moving the Clause, namely, that it would lead to widespread legal evasion. It would be quite legal to do that and though, no doubt at a very early date, correction would be introduced in legislation to deal with the matter, that evasion would be inevitable and it would be practised over a very
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    large field or at all events over a field which would make it very costly to the Exchequer.
    The final point is this. It is suggested that the present position is not compatible with the Married Women's Property Act and kindred legislation, but I would remind the Committee that at the present time partly under that legislation and in this case certainly under Income Tax practice, there can be separate assessments and separate charge and collection, subject always to the condition that that separation is not allowed to diminish the aggregate amount of tax payable. I have already tried to indicate that at present we recognise marriage in the allowance which is made in assessment for Income Tax. As the law stands, it is £225 allowance for the married couple as against £135 for the single individual, which is a difference of £90. On the tax chargeable for the financial year on which we have now entered that difference represents a cost to the Exchequer of £17,000,000 which, I think, is a very fair recognition of marriage obligations. For all these reasons, although on the surface there is something attractive about the proposition in the proposed new Clause, the Chancellor of the Exchequer could not possibly accept it, and perhaps the strongest reason of all against it is the manifest injustice which would be inflicted upon the great majority of taxpayers who are entitled to our consideration.
    Mr. MARJORIBANKS: The Committee must have been impressed by the revenue argument of the President of the Board of Trade but nevertheless I, as a, backbencher and a bachelor, wish to support, to some extent, the contention of my right hon. Friend the Member for Wood Green (Mr. G. Locker-Lampson). I agree with him that the whole basis of this method of assessment is antiquated. At the same time I admit that it conforms with the idea flat a married woman is regarded by the law, in some degree, as an incapacitated person and that the husband and wife are regarded by the law as one person. Of course those are mere legal fictions but they recognise the facts of life that ordinarily the husband and wife do lead a common life and that their wealth is, to some extent, common wealth. There is one great injustice however

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    to which I would call the attention of the Chancellor of the Exchequer and the President of the Board of Trade. Although it is comparatively small in scope it is in fact a very serious injustice. Owing, I believe, to representations from a famous playwright whose wife had a very large fortune, a condition was brought in making it possible to have separate assessments as between husband and the wife for purposes of Income Tax. But supposing that I, through love, were induced to marry a lady of the dramatic profession who earned a very large income per year and that she, lothing and despising anything so mean as Income Tax, were to go away to America or somewhere else. The Revenue officials could in that case come down upon me and my small goods and chattels in order to satisfy their claim. It seems an absolutely monstrous injustice on a husband who marries a lady with a much greater fortune than his own, that his small house and personal possessions should be liable to seizure by the Revenue officials because of the neglect or the whim of his wife. I ask the right hon. Gentleman to give his attention to this matter and to see if this serious injustice cannot be remedied.
    Mr. MORRIS: This proposed new Clause is a very "hardy annual." It comes up every year in the debates on the Finance Bill and no new argument has been adduced either for it or against it. It all depends upon whether a party is in Opposition or in office, as to whether they champion this proposal or oppose it. The party which is in Opposition always champions it; the party which is in office always opposes it, and the very arguments which have been used to-day by hon. Members above the Gangway were used on previous occasions by hon. Members now sitting on the Government side and vice versa. One of the main reasons which has deterred every Chancellor of the Exchequer from considering this proposal favourably is that of its effect on the revenue. The right hon. Gentleman the President of the Board of Trade has told us that it involves a matter of £35,000,000 and, of course, the Chancellor cannot forgo that sum. But I think if this proposal were put to the House of Commons, apart from any consideration of supporting the Government of the day, the House of Commons as a whole
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    would be in favour of it because I think nearly every Member has at one time or another expressed views in favour of such a proposal.
    The one consideration which has operated against the adoption of the proposal clearly is the consideration of revenue. But that argument in itself only goes to show that the amount of the present toll upon marriage is £35,000,000. There is no logical argument in favour of the line of demarcation chosen by the right hon. Gentleman the President of the Board of Trade in his reply. The right hon. Gentleman has chosen, as he always does, the best argument that can be found, namely, the argument as to the effect of this proposal upon people receiving incomes below £1,000, but I think that some means might be devised to meet what is obviously an injustice in this matter. I do not know if it would be possible to put a tax upon bachelors like the hon. Member for Eastbourne (Mr. Marjoribanks). That might be a method of remedying this obvious injustice and of meeting what, I believe, is the sense of all Members of the House of Commona—when they are in Opposition.
    Mr. RAMSBOTHAM: I am not sure that the argument that this new Clause is a "hardy annual" tells against it. It tells very much in favour of this proposal that in spite of the eloquent and sometimes convincing arguments which the President of the Board of Trade addressed to the Committee, that every year, while this age-long injustice remains unremedied, Members are to be found willing to voice the claims of married people in this matter. The hon. Member for Eastbourne (Mr. Marjoribanks) spoke from the point of view of the bachelor. I speak from the point of view of a married man, and I am not in the least impressed by the concession to which the President of the Board of Trade referred as having been made to matrimony, in the form of the allowance of £225 to the married couple. I would point out that if a couple fail to regularise their union each gets a personal allowance of £135. Thus they would make £45 on the transaction, and thus I fail to see the force of the right hon. Gentleman's argument as to the concession which has been made in favour of regular unions.

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    I have taken out certain figures in order to show how married people are penalised at the present time. It may interest the Committee to know that a married pair each earning £500 a year, at the present time, after all allowances including that of which the right hon. Gentleman boasted, pay £95 10s. in taxation, whereas were they living together but not married the taxation payable by them would be £64 5s. Therefore, the married couple are penalised to the extent of £31 5s., and every time the husband looks across the coffee pot at his wife he realises what a lot marriage is costing him. The right hon. Gentleman used what may have seemed to some hon. Members a very convincing argument about the revenue, but the fact that the revenue is making so much money out of this injustice is surely an additional argument in favour of the new Clause.
    Mr. ALBERY: I think the discussion has shown us conclusively that the majority of Members of the Committee, if they were free to act, would alter the present method of taxation in reference to married people but the manner in which the Finance Bill is discussed renders it quite impossible now, or I suppose in the future, to alter this matter by means of one step. Unless some Chancellor of ale Exchequer has the courage to make a start with some kind of alteration, even if it is only a minor alteration to begin with, nothing will ever be done, because it is obviously impossible at this stage or at any subsequent stage in the proceedings on the Finance Bill to make an alteration which would involve some £35,000,000 in the Budget of the country. If some Chancellor had the courage to bring in a new Clause which would deal with one part of this matter first then, gradually, we might have this injustice rectified.
    Mr. R. W. SMITH: We have heard that the Opposition are always in favour of this proposal and that the Government are never in favour of it but our hope was that, on this occasion, the Government would favour the proposal for the very simple reason that one of the great theories of this Government is that of the redistribution of wealth and the President of the Board of Trade, only a little while ago, declared that the immediate effect of this new Clause would be
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    that a spouse Who was wealthy would hand over to the other party a considerable amount of wealth. Thus we have a case here in which the Government could help to carry out their idea about the redistribution of wealth to that extent at any rate, and I thought it was a proposal which would commend itself to the President of the Board of Trade.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Repeal of duty on vegetable turpentine and white spirit.)
    The duty on vegetable turpentine anti white spirit is hereby repealed.—[Lieut.-Commander Kenworthy.]
    Brought up, and read the First time.
    Lieut.-Commander KENWORTHY: I beg to move "That the Clause be read a Second time."
    This is the first time I have ventured to intervene in the long and sometimes heated Committee proceedings on the monumental Finance Bill of my right hon. Friend the Chancellor of the Exchequer. I propose now to intervene briefly on a subject which affects 103 constituencies in this country and to present a proposal which, I know, has the support of a great many Members in all parts of the Committee. The proposed new Clause would repeal the duty on white spirit and turpentine and in submitting it I propose to reinforce myself by recalling what was said in a debate on this subject on the 23rd July, 1928. On that occasion a proposal practically similar to this was moved by the hon. Member for Leith (Mr. E. Brown), and was supported by the present Financial Secretary to the Treasury. I will only quote two of his strictures on the tax. He said:
    "The tax, as it was originally conceived, was a bad tax."
    Secondly, he said:
    "The duties are unjust and injurious to trade and employment."—[OFFICIAL REPORT, 23rd July, 1928; col. 1022, Vol. 220.]
    It was not surprising that after the hon. Gentleman had so eloquently charmed the House with the inequities of this tax, the Chancellor of the Exchequer voted against it. He himself voted against it, so did the Prime Minister, and so did the President of the Board of Trade. In fact, the whole of the Labour and Liberal parties voted against it, but although the Conservatives did not go into the Lobby

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    against it, the hon. and learned Member for Moss Side (Sir G. Hurst) and the hon. Baronet the Member for North-West Hull (Sir A. Lambert Ward) very strongly supported it.
    My right hon. Friend has been constrained to keep the tax on, I daresay for very good reasons, but I beg him to consider whether it could not be abandoned. The arguments briefly are that turpentine, a vegetable oil that cannot be produced in this country, is an essential raw material for paint, varnish, and colour manufacture, linoleum, wallpaper, floor polish, boot polish, and so on, and the number of people directly employed in these manufacturing processes is very great. Turpentine cannot be used for motor engines. I understand that the argument for the taxation of turpentine is because it is a competitor with white spirit for certain processes, and that it is not fair to tax white spirit and exempt turpentine, but industrial alcohol is not taxed, and it also is in competition with white spirit, and on that argument it ought to be taxed. There is no reason why the Turpentine Tax should not be dropped, but it would be far better to drop the tax both on turpentine and on white spirit. It is said that white spirit can be used with motor engines, but the best answer to that is that during all these years—and it is much cheaper than ordinary petrol and benzol—it never has been adapted for use in the internal combustion engine. You have manufacturers who use internal combustion engines importing immense quantities of white spirit, and they have never thought of trying to use it in their engines.
    I think my right hon. Friend should remove this tax, the amount of which is very heavy. Of the value of white spirit, the amount of tax levied is from 40 to 50 per cent., which is a crushing burden, and on turpentine it is about 15 per cent. I admit that the duty brings in a substantial sum. For white spirit it is about £233,000 a year and for turpentine about £86,000 a year, but the fact that it brings in a substantial revenue shows that it is also a very heavy burden on the manufacturing industries concerned. Indeed, since the duty was imposed, unemployment in these industries, and especially in the paint and varnish industry, has risen, I do not say only because of the duty, but undoubtedly the
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    duty is a contributory cause. The figures have gone up from 4 per cent. in 1927 to 6 per cent. in 1929, and, of course, that happens if you put a tax on a raw material. There is no more logic in taxing these two essential raw materials than there would be in taxing wool, or timber, or cotton. If my right hon. Friend taxed those three basic raw materials, he could raise an enormous revenue. Some of my hon. Friends opposite are talking of doing it for other purposes, but we do not get even Empire Free Trade out of this tax.
    This taxation, furthermore, hampers us in the export trade, which is very considerable. It is true that rebates can be obtained, but it is not only the amount of money that enters into the question. I would draw the attention of my right hon. Friend to a short extract from a letter from a very large firm in my own constituency which is engaged in a considerable export trade and giving a great deal of employment. Messrs, Hanger, Watson and Harris, Limited, very important manufacturers in Hull, say:
    "In our manufactures for the export trader we have to make a separate claim for practically every shipment and the clerical work and record keeping is very heavy, and for every shipment a Customs officer has to canter down here about three miles from the Customs House, and for certain goods we have to pay the cost of him coming."
    It is that sort of thing—the delays, the extra clerical staff required, and the actual bother involved—that is hurting the export trade. In regard to the manufactured article used in this country for house paint, for buildings and public works, there is no rebate, and therefore it is a direct tax on construction and on building the homes of the people.
    It is a very vexatious tax. It was conceived by the right hon. Member for Epping (Mr. Churchill), and it was put on, I believe, with regard to turpentine, under a genuine misunderstanding. At the same time paraffin was taxed, but there was a tremendous outcry in the rural districts from the cottagers and farmers who used paraffin, and hon. Members from those districts came back from their week-ends and made such representations to the Conservative Chancellor of the Exchequer that he dropped the tax on paraffin. Paraffin can be used in internal combustion engines, but the

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    turpentine and white spirit which my right hon. Friend taxes cannot be used in internal combustion engines. Why was the tax on paraffin taken off? It was because there was a great outcry from an electorally powerful section of the community, but in regard to turpentine and white spirit only a few manufacturers scattered about the country, and the workpeople they employ, are affected. They have not the political pull of the cottage dwellers and the farmers who use paraffin, and for that reason my right hon. Friend, who, everyone will admit, is chivalrous and the friend of the weak, is, I am sure, sympathetic to our demands.
    It is just because these people have not a great, organised, political machine that they can bring to bear in the constituencies that my right hon. Friend should be particularly tender to them, and I am certain that, it is not my right hon. Friend's, desire to tax them. He is now accused, in these days when there has been much midsummer madness among bankers and others, of being an orthodox Free Trader. Let him stand by those Free Trade principles here and not tax essential raw materials which even the moat fanatical Protectionist opposite has never demanded should be penalised. Let him promise us to remove the Turpentine Tax now, and I hope also to hear from him that he can remove this impost on white spirit as well.
    The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden): My hon. and gallant Friend the Member for Central Hull (Lieut.-Commander Ken-worthy) has stated his case with great force and moderation. This Clause has placed me in a somewhat difficult position, and I should not be prepared to rebut many of the arguments which my hon. and gallant Friend has used. This is a tax that I myself would never have thought of proposing unless all the other available sources of revenue had been completely exhausted. The tax upon turpentine and white spirit was imposed as part of the motor taxation two years ago, and it was imposed, as the Committee knows, for the purpose of partly raising revenue to finance the de-rating scheme. It is a tax upon industry, and, therefore, theoretically and to a large extent practically, that is a condemnation of the tax, but the condemnation applies too to the whole of the Motor Duties,
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    and, of course, the revenue derived from petrol is enormously larger than the revenue from these two taxes which are now under consideration. The amount of revenue involved by a sacrifice of these two taxes is not very large. The cost of the repeal of the Turpentine Tax would be about £100,000 a year and of the tax upon white spirit something like £250,000, a total of about £350,000. That is not, as I say, a very large sum, but it is a sum of very considerable importance to me when I am searching for a possible sixpence still left in the pockets of the taxpayer.
    I might add this, that I think it would be very difficult to repeal these two taxes and stop there, because I think we should be compelled to extend to—and I am sure there would be a vociferous demand for the extension—to the tax upon petrol for non-road use. I think I have already indicated that in the matter of the burden of taxation, you cannot make any distinction. Take, for instance, the Petrol Tax. I am speaking from memory, but I think that about three-quarters of the revenue from petrol is paid by commercial vehicles, and nobody can deny that that is a tax upon industry. Some hon. Members who were in the last Parliament may remember that in the debates upon the Petrol Tax I produced a number of omnibus tickets, which were specially given out as the travellers' contribution to the Petrol Tax, and, therefore, the conclusion which I must for the moment regretfully announce is in no way based upon an approval of these taxes. If I were in a position to repeal them—nay, if I were in a position to repeal the whole of the Petrol Taxes—nothing would give me greater pleasure, but I very much regret to have to say that I cannot this year see my way to make even this modest remission.
    I took the trouble this morning to go through the Amendments on the Paper and to calculate the cost of the various demands which are made in the various new Clauses which appear there, and the Committee may be interested to know that, if I were to accept all these proposals, the total cost to the revenue would be £237,000,000. I think the Committee would hardly expect me to shoulder that. [Interruption.] If I begin with this particular tax, it is very

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    difficult to stop there, and, therefore, with this expression of sympathy with the object of this Clause, I am afraid I must ask the Committee to be satisfied for this year. Perhaps at some time we may sail into happier times, and then the remission of this and other taxation of this character, I can assure the Committee, will receive my favourable consideration.
    Mr. GRAHAM WHITE: I am not quite certain whether I ought to thank the Chancellor on behalf of those Members who are so much interested in this proposed new Clause for the sympathy which he bestowed upon it. I must do so, although I cannot go so far as to look a gift horse in the mouth. I feel sure that the right hon. Gentleman would be quite unable to enter any defence at all for the continued existence of this impost upon a raw material. I was unable to follow him in his fear that, if he made this concession, he would be obliged to extend the area of his concessions, because I cannot understand how turpentine can be brought within the scope of this impost at all. It is not even a hydro-carbon oil; it would be far more logical to bring within the duty a substance like vaseline, which is a hydro-carbon. It cannot in any circumstances be used in an internal-combustion engine, and ought never to have been included in this duty. I have never been quite clear how it got there; I can only think that it was over-looked by the predecessor of the Chancellor. I cannot think that he was actuated by malice or animated by spite when he selected the users of turpentine and white spirits for this impost, because we have learned from the right hon. Gentleman the Member for Epping (Mr. Churchill) that these sentiments of malice and spite are things which he particularly abhors. When he was trying to defend the duty, he endeavoured to point out that there were ways by which the wind could be tempered to the lamb that was to be shorn, and he thought that no difficulty would be found in passing this impost on to the consumer. The position has changed, however, because the experience of the two years has proved that the manufacturers have not been able to pass the duty on to the consumers.
    It was pointed out also that although this duty would be levied on the raw
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    material which manufacturers use, and although it would undoubtedly increase their costs, the manufacturers would get the substantial benefit of the de-rating of their premises, to pay for which was the object of the duty. There again the situation has changed, because this relief has been proved in practice not to exist. In the case of paint and varnish manufacturers, it is found that in most instances the actual relief of rating is exceeded four times by the amount of the impost which is levied on their raw material. There is, therefore, no case for retaining this very serious duty. The right hon. Gentleman has been obliged by force of circumstances to levy increased taxation in this Budget, and this has had an unfortunate psychological effect upon industry. I had hoped that in regard to the Turpentine Duty, which would cost about £86,000 in a year, he would make a gesture to industry, which would have been evidence of his goodwill. He has spoken to us sympathetically, but I wish he had seen his way, even if he could not have taken the duty off, to have given an undertaking that he would remove it next year.
    Mr. D. G. SOMERVILLE: I would like to reinforce the appeal of the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) for the removal of this duty, particularly in the case of turpentine. The Government are extremely interested in housing and in getting up houses for the working people. Turpentine is an article which is used in the paint on these houses. Paint is one thing which cannot be left off a house if it is to be made respectable, and turpentine is essential for every building that is painted. Every paint manufacturer or builder will tell you that the cost of painting is a serious item, and if the Chancellor could see his way to take off this duty, he would help an essential element in the building of houses. A sum of £86,000 in a Budget of the size which he has presented is a very small matter, but its remission would be a big concession. We have under consideration at the moment a slum clearance Bill, and when that goes through, there will be an enormous amount of small building to be done. That will be carried out by small contractors, who cut down their prices to the lowest possible level, and every penny on every

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    article which they have to use in the construction of houses will count. I would make a very strong appeal to the Chancellor to be generous for once, and to remember his Free Trade origin and his professions. This is a duty on a raw material which cannot be produced in this country, and which must be obtained from abroad, and to show his genuineness of purpose, and his belief in his professions of Free Trade, he should take off this small duty. From a practical point of view, it would help housing, which is what the Government desire to do, so I appeal to him earnestly to see his way to drop this small item of £86,000.
    Mr. ARNOTT: The speech of the Chancellor of the Exchequer was quite as much in opposition to the duty as any of the speeches of those attacking it. There was only one line of defence which he put up apart from the financial aspect; that is, that the duty on petrol was quite as much a tax on raw material as the duty on turpentine and white spirits. That is true, but the argument which was put up when the Petrol Duty was imposed was that there were some different considerations in respect of petrol. I do not know What the considerations were; I suppose they had something to do with penalising vehicles which consume petrol, although that could have been done by an ordinary car tax. It is certain that this duty was put on under a misapprehension. It was assumed that white spirit could be used for the purpose of running an engine. It might be under some circumstances, but it cannot be under ordinary circumstances. Therefore, there is a big distinction between imposing a duty on fuel for internal combustion engines, and imposing a duty on what is an essential material of a totally different industry. The Chancellor himself says that the duty is unjustifiable. It is against the Free Trade principles of which he is an advocate; it is against Protectionist principles as well, and I rather regret that, while we got his sympathy, we had no promise that something would be done next year, if not this.
    Mr. ERNEST BROWN: I moved the removal of this duty last year, and I regret that the Chancellor has not seen his way to meet us this year. This duty
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    particularly affects the sea ports, in every one of which there are numbers of small varnish and colour manufacturers, who do not employ a lot of men, but who perform a valuable function, and who have been hardly hit by this duty. The amount of relief that would be given to this small industry is out of all proportion to the amount of money received by the Chancellor, and I know that there will be great regret in the seaports to-morrow when it is found that he cannot see his way to take the duty off, especially when he was bound to take up the position when in Opposition that the duty is a thoroughly bad impost in its relation to industry. We shall hope that next year the duty will be got rid of, because there is no defence whatever for it, and because it affects all the manufacturers of paint and varnish which is used not merely for housing, but for sea-going ships. I regret that the Chancellor has not been able to meet us in this matter.
    Major HILLS: I find it difficult to argue against this duty, because the strongest speech against it has been made by the Chancellor of the Exchequer, but I would suggest that if there be any concession that he could properly make on the ground both of principle and of application, if is surely with a duty of this sort. I am certain that it offends his principles; I am sure that he does not like a tax on raw materials, or one that discriminates, as this does, against one special industry. I am sure he bears in mind also that the intention of the original Petrol Duty was never wide enough to include turpentine. The Petrol Duty was definitely a tax on transport. Rightly or wrongly, that was the intention, and largely the effect, of that duty De-rating was to be paid for by taxing transport, and it was on that ground that paraffin was exempted. I have always felt that the case for the exemption of these spirits was just as strong, for they cannot be used as motor spirit, and ought not to be within the ambit of the duty. A very small sum is involved in this duty, and its remission would not upset the Chancellor's Budget. He has much bigger sums to meet in future, and a small concession of £300,000 odd is not a big thing to ask. On points of principle and of justice the Chancellor of the Exchequer is with us, and I hope

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    that even now he will yield. The demand comes from all sides of the Committee; it has been pressed with great moderation, and there is a very strong case for it.
    5.0 p.m.
    Mr. HOFFMAN: I would like to join with my colleague from Hull in pressing upon the Chancellor the request for the repeal of this duty. I understand that there may be some difficulty in distinguishing between white spirit and petrol, but that point cannot be made in respect of turpentine. Vegetable turpentine can never be mistaken for petrol, and if the Chancellor cannot see his way to remove the whole of the duty upon these commodities perhaps he can see his way to taking off that upon vegetable turpentine. It is a raw material which enters very largely into one of our basic home industries, and, apart from that, I would remind him of the growing export trade in boot polishes and floor polishes. Our export trade is carried on on a very narrow margin, and even a tax on vegetable turpentine may weight the balance against us in the world's markets. I hope the Chancellor will soften his heart and relieve us of the duty on vegetable turpentine.
    Rear-Admiral BEAMISH: I also have a few points to put to the Chancellor with a view to persuading him to adjust his mind on this matter. I think I am correct in saying that continental countries allow a rebate on white spirit and turpentine which is used for industrial purposes such as we are referring to here, and that makes it a little unfair that we should continue this duty. He himself said that he would not have imposed such a duty until all the other available resources of taxation had been exhausted. Surely that cannot be the genuine opinion of a Chancellor of the Exchequer who has shown such remarkable ability in extracting money from the people of this country! If so, the Socialist schemes we have heard so much about cannot stand for a very great deal. I would like to concentrate on the lesser part of the problem, the turpentine duty. There are at least two, and I think more, factories in my constituency which use a large quantity of turpentine. They are remarkably efficient, and one of them at
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    least—if not both—is considered to be one of our show factories and to lead the way in industrial welfare as well as in efficiency. They are both endeavouring to extend this growing British industry.
    The Chancellor remarked just now on the difficulty of raising more money. Does he realise that if he were to give up this £100,000—even if he would give up only a half of it, that would be very acceptable—it would mean no more than one-eighth of a penny on the Income Tax? He has already raised the Income Tax by 6d. to get somewhere about 50 times the amount of money that he will raise by retaining the Turpentine Tax. Surely he is in a position to give up one-fiftieth of the 6d. rise on the Income Tax in the interest of the industries of this country? It is not as though turpentine were a luxury. There is not a cottage in the country, and certainly no large house, which does not take a pride in keeping its linoleum polished and having the place looking as smart and as bright as a British home should look, and I earnestly request the Chancellor to reconsider his attitude and at least remove the duty on turpentine. That would be a remarkably kind action, which would be very much appreciated in almost every constituency.
    Mr. CULVERWELL: I would like to congratulate the Chancellor on the charming and almost disarming way in which he has refused this request, but I am sorry that he should have based his excuse on the Petrol Duties, because the duty upon turpentine has no real connection with the hydrocarbon oil duties. They were imposed partly in order to raise revenue and partly to levy a fairer burden upon motor car users with, as we hoped, the idea of a reduction in the horse-power duties when the revenue permitted it; and there was the further reason that it was hoped to encourage the distillation of oil from coal at home and in that way to build up an oil-producing industry in this country. Not one of those arguments applies to the duty upon turpentine. Turpentine cannot be produced in this country. It is a raw material of a very important industry, and one in which I am particularly interested, because there are several large and important paint factories in Bristol which are feeling the effects of this duty, and say that it more than outweighs the advantages they have received under the

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    de-rating scheme. The Chancellor, in talking of the impossibility of accepting this proposal, said that if he agreed to all the proposals in the sheaf of Amendments he has before him he would be called upon to sacrifice some £257,000,000 of revenue. He is not afraid to increase expenditure, in order to gain the support of his followers on the back benches, by hundreds of millions of pounds. He has made no concession at all to industry in his Budget, done nothing to assist industry, made no reduction of taxation; and when he is asked to make this trifling concession of under £100,000 by repealing a duty which he admits is unjust I ask him to give the request most serious consideration, even though he may steel his heart against sacrificing the £257,000,000 involved in the other proposals.
    Mr. KINLEY: I wish to add a further word of appeal to the Chancellor to give consideration to this new Clause while there is still time. I do so principally because there is in my own constituency an instance of the way in which this duty does cause hardship to one particular firm. It is an outstanding firm, and the head of it is one of the staunchest and best known Free Traders in this country. The conditions under which the employés work compare favourably not only with those of other firms in the same industry, but with those of any other industry, the conditions are of the best; and the firm is so carried on that the profits do not all go to the shareholders, but are largely returned to the employés.
    The DEPUTY-CHAIRMAN: I do not think we can use this debate to advertise a particular firm.
    Mr. KINLEY: I will come to the point. This firm has now to pay an annual tax of £2,500 upon one of its raw materials, white spirit. If there are firms which are so seriously hit by this duty upon one of their raw materials, then the Chancellor ought to be ready to grant the exception for which we ask. Industry ought to be freed from this impost; whatever the cost to the Treasury it would be well recompensed by the benefit to trade.
    Lieut.-Colonel Sir A. LAMBERT WARD: It gives me very great pleasure
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    to find myself in complete agreement with my hon. and gallant colleague the Member for Central Hull (Lieut.-Commander Kenworthy). This happens so very rarely that I think it will be agreed that any case which we have united to support must possess some inordinately good points. I have always looked upon this duty as being more or less in the nature of an experiment. The duty as originally drafted included all hydrocarbon oils, but it was very soon found that a duty on paraffin could not be carried, and that portion of the duty was dropped. In my opinion it has by now been amply demonstrated that the portion of the duty which is levied on turpentine and white spirit is also doing a, very grievous amount of harm to certain industries, and therefore it ought to be dropped. As I listened to the speech of the Chancellor I fear that I jumped prematurely to the conclusion that he would accept this new Clause, because he did not advance a single argument in favour of this duty other than the lather sordid one that it was helping him to obtain the last sixpence from the taxpayers' pockets. That is not altogether the point. As has been emphasised by many speaker s, this is a duty on the raw material of a particular industry which, without being especially flourishing, is one of the few industries which is maintaining its export trade. A duty on its principal yaw material will in the long run tell against that export trade and hinder the possibility of our reducing our adverse balance of trade.
    One of the principal arguments in favour of the De-rating Act was that it would relieve industry of some of its heaviest burdens. Here we are giving with one hand and taking away with the other, and in many cases are actually taking away more than we are giving, because with the firms which I have in mind, the tax on turpentine and white spirit is costing in some cases a little more than, and in other cases nearly twice as much as, the amount of relief they are getting in the matter of rates. As far as export trade is concerned, it is perfectly true that a rebate or drawback is given on all tupentine and white spirit which has been used in an article for export, but the difficulty and the trouble of obtaining that drawback by

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    proving the amount of taxable article that has been employed is so difficult and so worrying to put through that it is scarcely worth the trouble.
    As regards the home trade, the argument was advanced during the debates on this particular tax that the tax could easily be transferred to the consumer. That was the original intention, but it has been proved to be useless on account of the fact that competition is so keen, and partly on account of other considerations connected with the trade, that it has not been possible to do so, and the whole of this tax has to be borne by the industries concerned. That being so, combined with the fact that the amount is so small, I sincerely ask the Chancellor of the Exchequer whether he cannot meet us in some way on this point. If he considers it essential that the tax on white spirit should be continued, then let him meet us with regard to turpentine, because that brings in a comparatively small amount. The remission of this tax would go a very long way towards improving the conditions of this particular trade.
    Lieut.-Commander KENWORTHY: In view of the sympathetic answer which has been made by the Chancellor of the Exchequer, and in view of the expression of opinion in various quarters of the Committee, my object has been served, and I beg to ask leave to withdraw my Motion.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Amendment of law relating to excise liquor licences.)
    (1) The excise duties payable on the retailers' on-licences and retailers' off-licences specified under heading C of the First Schedule to the Finance (1909–10) Act, 1910 (including the duties payable in pursuance of paragraphs 3, 4, 5 and 6 of the "Provisions applicable to retailers' on-licences," contained in the said Schedule and the reduced duties payable under section forty-five of the said Act as amended by section eight of the Finance Act, 1920) shall as from the twenty-eighth day of May, nineteen hundred and thirty, be reduced by one quarter.
    Provided that nothing in this sub-section shall affect any minimum duty payable under the said Schedule.
    (2) The minimum duty payable under Scale 3 in the said First Schedule for a publican's or beerhouse licence in respect of premises situate in an urban area with a population of five thousand or above shall
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    as from the said twenty-eighth day of May be reduced so as to be the same as the minimum duty payable for such a licence in respect of premises situate in an urban area with a population of two thousand and less than five thousand.—[Sir P. Ford.]
    Brought up, and read the First time.
    Sir PATRICK FORD: I beg to move, "That the Clause he read a Second time."
    In view of what the Chancellor of the Exchequer has said, I am not very much encouraged, in bringing forward this new Clause, standing in my name and the name of the hon. and learned Member for Argyllshire (Mr. Macquisten). I say quite frankly that the adoption of this new Clause would mean the giving up of about £1,000,000 of revenue. In spite of his kindness, his self confessed and super-Aberdonian zeal in collecting sixpences shows the right hon. Gentleman to be very thorough; in fact, he is as thorough as the American thought our police. He lost his wallet containing a large wad of notes, and reported his loss to Scotland Yard, where they told him that no stone would be left unturned to recover it. Next morning the road-breaking gang started operations with their pneumatic drill under his hotel window, and he remarked to his English valet, "Say, ho, I hand it to your police guys for thoroughness." The Chancellor of the Exchequer has shown great thoroughness, but in some cases it is misplaced thoroughness. The principle of justice has to be considered and the proverb about killing the goose that lays the golden eggs. I know that the right hon. Gentleman is a just man, and I think he might grant this concession and avoid the danger of killing the goose. It would not be in order for me on this new Clause to deal in detail with the enormous taxation which is borne by the licensing trade of this country. Perhaps I may be permitted to point out that everybody who buys a 12s. 6d. bottle of spirits pays something like 8s. to the Revenue, and consequently this is a very valuable source of revenue. Whatever people may think about the consumption of wines and spirits, no one can deny that it is a very valuable source of revenue. From the point of view of justice it is bad and taxation means adding that extra turn of the screw that may wring the goose's neck.

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    We have now to consider the position very carefully. This new Clause asks that a quarter of the Licence Duty for the sale of beer, wines and spirits in licensed houses should be remitted. My new Clause also asks that in relation to off-licence houses in the case of licences for the sale of spirits, there should be a reduction of the minimum allowed in the scale. There was a complicated scale in 1910, and the minimum duty allowed in towns of a certain size was £35. It is now asked that the minimum should be reduced to £10. In large towns the rentals are apt to be high, and under this proposal there is a danger of small houses being wiped out if they have to pay as a minimum as much as £35. We cannot see why a small off-licence trade should not be decently conducted, and it is often more for the convenience of the poor people in the neighbourhood of a large town. We feel that we are only asking for a simple measure of justice.
    In 1910, when these licences were imposed, the hours were very different. As between Scotland and England at that time the hours varied between 19 and 18, and now they vary from nine to 10, and that is a very great reduction. There has also been a great fall in the consumption of spirits from over 30,000,000 gallons at the time of the imposition of the duty to about 19,000,000 gallons at the present time. The amount of consumption in Scotland is about 2,500,000 gallons. I say this to show that this is a question which is of interest not only to Scotland but also to the whole country. It should be remembered that the assessment of licensed premises is based on the rental, and the rentals are larger in all kinds of industrial subjects and hereditaments, and show a tendency to go up. There is the additional danger that if the licence holder decides to spend money upon the improvement of his premises, as moderate people advise him to do, he is liable to have his assessment raised, and I think that is another hardship from which he might be protected, to some extent, in the interests of the public.
    On the whole question of varying the amount of the licence duty on off-licences on account of the reduction of hours and the reduction of turn-over, I think that is a principle which has already been accepted. It was accepted in 1872 when
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    a reduction of licence duties was made when Sunday closing came into force. A rebate was made during the War when certain restrictions with regard to hours and the amount of consumption were brought into force. Those restrictions were embodied in the Finance Act, 1917. Since then some of those regulations have been swept away, but the reduced hours of sale have remained, and that means a large reduction in consumption. There has also been a large reduction in the consumption of beer. In view of these facts, it is obvious that some reduction should be made. We should recognise the principle of altering the levy according to the probable turn-over. The present Chancellor of the Exchequer, in the year of grace 1924, in reply to a deputation, showed considerable sympathy, although he did not put that sympathy into effect. The late Chancellor of the Exchequer, in his preliminary Budget statement, said that when he was returned he would introduce in the second part of his Budget the concessions for which I am asking. We had great hopes in view of the sympathetic attitude of the present Chancellor of the Exchequer in 1924, and in what the late Chancellor promised in 1929, which was not put into operation owing to certain regrettable incidents at the poll. We hope that this act of justice will be done to-day to the very hard-working and from the Chancellor's point of view well-deserving members of this trade.
    Mr. MACQUISTEN: The hon. Baronet the Member for North Edinburgh (Sir P. Ford) has made such an able speech in moving this new Clause that it is not at all necessary for me to take up much time in supporting the Motion. The hours are down by half, and, in addition, there is very high taxation on account of increased assessments. Besides this, the trade has had to face a great diminution in consumption. In spite of all these drawbacks, the trade is more efficient in this country than it is on the other side of the Atlantic, and it has enforced prohibition almost to an extent that would satisfy the hon. Member for Dundee (Mr. Scrymgeour). As a matter of fact, the trade is acting as tax collector; indeed the original meaning of the word "publican" was "tax collector." In the part of the Highlands which I represent, there are 12 or 13

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    distilleries, which collect an enormous amount of revenue for the Chancellor of the Exchequer, and yet I cannot even get a telephone out of the right hon. Gentleman to enable them to carry on that work, which is the chief business of the district. I was surprised to learn that this proposal involves such large figures. It only shows how heavy the burden is, and, if the Chancellor of the Exchequer is getting, through these diligent servants of his, such an enormous sum, surely, when he has cut down their opportunities of serving him faithfully to the extent that he has, he ought to make this concession. It will not do to destroy them utterly, because then he will have to find a new source of revenue, and possibly he may even have to follow the suggestion that I have made on former occasions, and call upon those people who do not consume excisable liquor, and who thereby escape, especially if they do not smoke either, a very large proportion of the taxation which is borne by their fellow-countrymen, to take out a licence for indulging in such virtues. Unless something of that kind is done, and if this sort of penal taxation is to be continued, the whole business may be exterminated, and those people to whom I have just referred may wake up and find that they will have to spend a great deal more money in taxation than would otherwise be the case.
    The FINANCIAL SECRETARY to the TREASURY (Mr. Pethick-Lawrence): I am sure that the hon. and learned Member for Argyllshire (Mr. Macquisten) will not expect me to follow him into the question of the merits of the modern publican, or the origin of his name. I will address myself to the more direct subject-matter of the proposal contained in this Clause. The suggestion is that the licence duty should be reduced by one-fourth, and that the minimum licence duty also should be at a lower rate in towns than has hitherto been the case; and it is proposed that these alterations should apply both to on-licences and to off-licences. In this latter respect, the proposal contained in the Clause goes beyond what was suggested by the late Chancellor of the Exchequer, whose proposal only applied to on-licences. It is unfortunate for the sponsors of this Clause that they did not persuade the late Chancellor of the Exchequer
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    to introduce the proposal in what he called his first Budget. As the Mover has reminded us, he postponed it until his second Budget, which never eventuated owing to the result of the General Election.
    This proposal would involve the revenue in a loss of over £1,000,000 a year in a normal year; but, unlike certain other remissions, it would involve the revenue in a still greater loss in the current year. The reason for that is as follows. It is proposed that the licence duty should be reduced as from the 28th May, that being due to the fact that both the Mover and the Seconder come from north of the Tweed, where most licences expire on the 28th May. In England and Wales, however, a large number of licences expire at a later date, mostly on the 30th September, and therefore, if this proposal were carried, there would be first of all a rebate on the licences for the current year, and there would be further a whole year's loss of revenue on the licences which would be taken out on the 30th September. Therefore, in the current year, the loss would exceed £1,300,000.
    Sir P. FORD: May I say that my hon. and learned Friend and myself are perfectly willing to make this part of our Clause applicable only to Scotland?
    Mr. PETHICK-LAWRENCE: I am afraid that, even in that amended and truncated form, the Clause would not be acceptable to my right hon. Friend. He is not able to see his way to suffer the loss of revenue which would be involved by the proposals of the Clause, either in its present form or even if the date proposed in it were only applicable to Scotland. Apart, however, from the loss of revenue, the Committee must remember that the present Government have remitted to Royal Commissions, for England and Wales and for Scotland respectively, the whole question of legislation relating to intoxicating liquors, and no doubt the question of licences and the right rate to pay for licences will come before those Commissions. In these circumstances, we cannot see our way to make any changes of this character pending the reports of the Royal Commissions.
    Mr. SCRYMGEOUR: I do not think that anything is to be looked for from

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    the Royal Commissions as far as this or any other important aspect of the question is concerned. There is no reason why any quarter should be given to the trade as a whole, but there is something to be said, and something has been said by those who are given to special pleading, in regard particularly to the retail interest, from the point of view that a great deal of the condemnation and criticism that is meted out to them is not, after all, fully warranted, in view of the approval which is given to the idea of imposing still further heavier taxation as a kind of temperance legislation, in which connection the tax-gatherer is not looked upon as he ought to be looked upon. As to the question of loss of revenue, it is certainly revenue, but it spells a dead loss to the country as a whole. We should do far better to give up drawing any revenue at all in this fashion. The prosperity of the country and the position in regard to employment would be much more substantially improved if we were not in this unfortunate predicament of having to pay so much—
    The DEPUTY-CHAIRMAN: I am afraid that we cannot enter into the merits or demerits of temperance now. The only question before the Committee is that of the duties payable upon excise liquor licences.
    Mr. SCRYMGEOUR: I am not speaking about the advocacy of temperance legislation—I am not given to that at all—but on an entirely different point, which is the one before the Committee, namely, the drawing of revenue from these licences. To that I object on the score that we are Proceeding on entirely wrong lines in exacting revenue from this source of trouble in the country. Further, I am submitting that, when the case is looked at fairly, the man who acts as the tax-gatherer does not merit the avalanche of condemnation which is poured upon him, as if he were the only factor that was causing trouble in this connection. It is the concern as a whole, and the exaction of revenue from that source, against which I am now making my protest.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Amendment of 10 and 11 Geo. V; c. 18.)
    The relief granted under sub-section (1) of section nineteen of the Finance Act, 1920, shall extend to care of a widowed mother who resides with the claimant and is wholly dependent upon him for support.—[Sir N. Stewart Sandman.]
    Brought up, and read the First time.
    Sir NAIRNE STEWART SANDEMAN: I beg to move, "That the Clause be read a Second time."
    I am certain that the whole Committee must feel that this case is a very just one for the making of some concession. If a man has a housekeeper, he gets a rebate of only £45 per annum, while if he has a widowed mother he gets, I understand, a rebate of only £25.
    Mr. P. SNOWDEN: In the ease of a housekeeper he now gets £60.
    Sir N. STEWART SANDEMAN: He gets £60 if he has a housekeeper, and only £25 for his widowed mother. Surely, the man with a widowed mother should be in no worse position than the man who has a housekeeper. I do not think that there is any argument on the other side. Such a man may have given up the chance of being married in order to take charge of his widowed mother, and I cannot see why the man who does not want to get married but employs a housekeeper should get a rebate of £60, while the man who is really doing his duty by his widowed mother only gets £25. I feel certain that this concession would not cost very much, and I hope that the Chancellor of the Exchequer will be able to see his way to grant this request from one who hardly ever bothers him at all.
    Mr. P. SNOWDEN: This is another of those Amendments which naturally excite sympathy. It is an Amendment which I have myself, I believe, supported in the Division Lobby when I sat on the other side of the House; but circumstances alter Cases, and I think that that charge of inconsistency could be levelled against every Member of the House who has sat under different party Governments. As the hon. Member has said, a very substantial allowance is now given to a widower whose widowed mother looks after his children in the capacity of a housekeeper, but that allowance cannot be given twice over. In the case which the hon. Member has in mind,

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    there would be an allowance of £25 a year as a dependant's allowance. I would point out that under the hon. Member's proposal the allowance would not be given to a father who was dependent upon a son, and the fact that the hon. Member has not extended his proposal to a father exposes the difficulty that exists in dealing with a matter like this, because quite as strong a case might be put forward for a relief of £60 a year for, say, an invalid's sister or an incapacitated brother, as for the support of a widowed mother. As the Committee will see, the whole question bristles with difficulties, and one concession inevitably leads to a demand for further concessions. In my present financial difficulties, there is one conclusive reason why, with all the sympathy in the world, I am unable to accept the hon. Member's proposal, and that is that it is estimated that it would cost more than £500,000 a year. For the present, therefore, I am afraid the hon. Member will have to be satisfied with my sympathy, and my hope that, as I said in connection with another Amendment, in future years we may be able to consider the proposal under happier financial conditions.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Provision to allow deductions in respect of inherently wasting assets.)
    For the purpose of enabling deductions from revenue receipts of expired capital outlay on inherently wasting assets to be allowed by the additional commissioners claims in respect of those deductions shall be included in the annual statement required to be delivered under the Income Tax Acts of the profits and gains of any trade, manufacture, adventure, and concern, and where such deduction from the revenue receipts is made, and has been made, from the commencement of the actual employment of the inherently wasting assets in seeking profits, or during a period of not less than three years to the end of the usual financial year of the particular trade, manufacture, adventure, or concern last prior to the year of assessment, and provided such deduction is so made as to prevent the same being available as profits, the additional commissioners, in assessing those profits and gains, shall make such allowances in respect of those claims as they think just and reasonable.
    For the purpose of this section the term "inherently wasting assets" means assets which necessarily waste in the process of seeking profits. Provided always that such
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    wasting assets are not the value of transferred rights to future profits or increase which would have been chargeable with income tax if no transfer of such rights had been made.—[Sir B. Peto.]
    Brought up, and read the First time.
    Sir BASIL PETO: I beg to move, "That the Clause be read a Second time."
    This is not the first time by any means that this question has been raised on different Finance Bills, but it is not on that account less important that it should be raised to-day, nor is the occasion of raising it less urgent. When this question was raised in 1910, and again in 1912, the Income Tax was 1s. 2d. in the £, while the Income Tax, by the present Finance Bill, is being raised from 4s. to 4s. 6d. in the £. Therefore, the question of the incidence of Income Tax upon what is not the income of a company at all, but is money which is necessarily put aside from year to year to meet wasting assets, becomes of infinitely greater importance. In 1910, the late Mr. Gibson Bowles raised this question on a Clause worded in much wider terms than the present very carefully drafted Clause, which was first moved in 1912 by the present Master of the Rolls, who was then a Member of this House as Sir Ernest Pollock. On that occasion the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) was Chancellor of the Exchequer, and he said then that there was a real case here which had to be dealt with. That was 18 years ago. It would be difficult to imagine a much more emphatic declaration than that. In 1923, I moved the same Clause, and on that occasion Sir Thomas Inskip replied and he indicated that, if the Government were in power in the following year, it would be dealt with in some way in the Finance Bill. The Government did not survive, but the hon. Member for Lewisham (Sir A. Pownall) moved the same Clause and the present President of the Board of Trade replied:
    "The Chancellor of the Exchequer authorises me to give this promise. Recognising, as we do, the injustice, we are willing to undertake that there should be an investigation of this matter. I do not think it is necessary to appoint a Treasury Committee. In the light of what has been recommended by the Royal Commission, I think the question might be dealt with by the Board of Inland Revenue. I will undertake to have this matter looked into without delay and

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    I hope, if we are in office next year, we may, without pledging ourselves to any specific thing, be able to place something on the Order Paper."—[OFFICIAL REPORT, 8th July, 1924; col. 2084, Vol. 175.]
    Again this very important question fell under very unfortunate circumstances, in that before the next year we had a change of Government again and I had to approach a new Chancellor of the Exchequer in 1925, to whom, of course, I could not quote the very emphatic words I have just given to the Committee. The right hon. Gentleman the Member for Epping (Mr. Churchill) was rather more guarded. He said:
    "In the last four years there have been six Chancellors of the Exchequer who sat in the chair that I now occupy, and I am sure the Committee will feel that anything of that kind ought now to come to an end, and that we ought to have continuity. On that basis I can promise my hon. Friend that there shall be the most careful watching of the serious case which he has put forward with a view to seeing whether if them were a possibility in any future years of giving a further relief of Income Tax, it could be applied in the way suggested."—[OFFICIAL REPORT, 16th June, 1925; col. 455; Vol. 185.]
    In that year the right hon. Gentleman the Member for Epping reduced the Income Tax from 4s. 6d. to 4s. The plea I put before him was that in any future reduction of the Income Tax he should not let it fall like the rain on the just and the unjust, but should concentrate the remission on this urgent question of allowing adequate deductions from annual profits or gains of money that was necessarily placed to a sinking fund to meet the obsolescence of machinery and wasting assets. Unfortunately, however, though the Treasury only had one Chancellor of the Exchequer in the next four years we did not get the question dealt with.
    I have a special appeal to make to the right hon. Gentleman. I know I shall have his sympathy. I do so because, in raising the Income Tax, it is clearly a time when it is additionally important to consider whether in its incidence it really is a tax upon income or whether it is a tax to a large extent upon industry. All the statements the Chancellor of the Exchequer has made recently seem to assume that he is dealing with genuine Income Tax. During the debates on the Budget Resolutions he said that
    "to tax large estates and large incomes was sound business and good for the State
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    and that the limits had not yet been reached. Small doses, reasonable doses, applied at regular intervals might produce good results, but if the medicine was taken all at once it would kill the patient."
    Successive doses of increased taxation, of which we have a specimen this year, he holds to be positively useful. That cannot possibly apply to an Income Tax as heavy as at present without any adequate allowance for wasting assets. Before the report of the Royal Commission on Income Tax, we were always told, whenever we moved in this matter, that we must wait for the Commission's report. Since it reported, in 1920, we have moved on various occasions this identical Clause and we have always been promised by every Chancellor, or his representative, that the matter would be attended to. May I call attention to exactly what, the Royal Commission stated in the first paragraph (Paragraph 180) of Part III of their Report, which has never been given effect to:
    "For Income Tax purposes, speaking in general terms, income is the surplus of receipts over the current expenditure necessary to earn those receipts, regardless of the appropriation of any part of the receipts or surplus for the purpose of writing off or amortising the capital value of any assets that waste in the process of producing the income. The only wasting assets for which Income Tax allowance is now made are plant and machinery, and certain buildings that contain plant and machinery. The primary reason for this exceptional treatment of plant and machinery appears to be that an allowance for the wastage of these particular assets is merely equivalent to that allowance for renewals and replacement of tools and implements, used for the purpose of a trade, which has from the first been recognised as a necessary expense under the Income Tax Acts."
    I think that that is important and interesting. From 1842, from the very inception of the Income Tax, it has always been recognised that there should be an allowance of some kind for replacement of industrial plant and machinery. That was extended in 1858 and again in 1878 to deal with Obsolescent machinery. In 1907 it was extended to a 4 per cent. allowance on ships, giving them a life of 25 years. So the principle has been recognised from the start and has been slowly extended, but the one part of the report of the Royal Commission which has never been given effect to is this question which has been raised again and again in the House.

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    May I read the paragraph which contains the summary of the recommendation of the Royal Commission? Paragraph 200 reads:
    "We come now to the general or main class of wasting assets to which we recommend that a depreciation allowance should be extended. Subject always to the limitation that their life falls short of 35 years, we recommend that an allowance shall be given in respect of all inherently wasting material assets which have been created by the expenditure of capital, such as buildings and foundations, surface works, permanent way and equipment of railways and tramways, docks, and shaft sinkings and initial work or development. In every case the allowance should be calculated by reference not to the absolute but to the relative liability to waste."
    I do not think that has ever been considered to be in all respects a satisfactory recommendation, because of the limitation of 35 years as the maximum on which the allowance should be made, and also because of the limitation, so far as mining operations are concerned, to their being mines abroad and not in this country. No doubt the recommendations of the report want looking into again. I think they want extending and not restricting, but clearly they want dealing with. The justification for the matter being dealt with is clearly more urgent the higher the Income Tax is raised.
    There is another reason why I specially want to call attention to this matter today. It is that an increase in the Income Tax rate without such an allowance has a very deleterious effect upon foreign companies domiciled in this country. These foreign companies are estimated to have a paid-up capital of £1,800,000, and the taxes collected as the result of their activities are somewhat about £90,000,000 a year. The companies simply have their registered offices in England. They operate railways, they are interested in land and investment companies and financial trusts abroad, and their capital is sunk in properties all over the world. They operate in the development and working of mines, nitrate deposits, oil wells and shipping companies, many of whose ships never come to our ports at all, and rubber plantations all over the world. Beyond registratration and financial control from London, these companies usually are only represented here by a small office staff, yet the profits that are made by them are
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    treated, as far as taxation is concerned, as if they were home industries. When you find that in America they recognise that the minerals in their own territory are wasting assets and they allow this deduction for which I am pleading, and when you realise that in none of the countries where these companies operate is there anything like the rate of direct taxation that there is in this country, and that they get very much better treatment from these Governments than they have hitherto been able to get from ours, it is clear that, by not dealing with this question of not charging Income Tax on matters which are not income at all, by not making a proper allowance for wasting assets, particularly in mining undertakings and things of that kind, we are running a very serious risk of causing these companies to change their registration to foreign countries and lose the many advantages which we have had before by their being located here. I have heard that since the introduction of the present Budget one or more of the very important companies have decided to register abroad. I would beg of the President of the Board of Trade, if he has not received his instructions definitely from the Chancellor of the Exchequer as to what he is to say when he comes to answer, to take very seriously into consideration that aspect of the question. It is certainly high time, with Income Tax at the present level, that we should see that we do not charge it in an unfair manner to these companies who do so very much for the prosperity of our country and for the balancing of our in and out overseas trade.
    6.0 p.m.
    It may be said, and always is said, more or less, in answer to all proposals such as this new Clause, "Oh, the cost is too much, and I cannot do it this year." I am not pleading for a remission of taxation; I am pleading for fair taxation. It is true that it would mean, if it were put into force immediately without any other provision, that the Chancellor of the Exchequer would collect less money this year. That fact cannot be denied. But in the long run it will be in the interests of the Treasury to look into this question and to settle it at once, because I am convinced that we shall be losing a great deal more Income Tax than we shall gain by charging it in an unjust manner. What we have to do now—

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    indeed, the time has long past when we ought to have dealt with it—is to see that we return to the original intention of the Income Tax Act when Income Tax was first imposed; that it should be a tax upon annual profits and gains. Considerations with reference to allowances become so much more powerful when you have raised the tax from a level of 7d., as it was originally imposed, or 5d. in the £ as it was in 1858, to a level of 4s. 6d. But when you raise it to that sort of a level it is absolutely essential that you should levy it upon the true income of the industries in question, and not charge it upon what you well know every prudently conducted industry cannot, and does not, regard as income at all, but as money which it is necessary to set aside in order to carry on business successfully and properly in the succeeding years.
    Therefore, without going into details as to the exact matters which should be included in wasted assets, as I have done on other occasions, I need only say that we have excluded questions of leasehold property and things of that kind which, it is generally agreed—and it was agreed by the Royal Commission—should not be wasting assets. This Clause has been drawn so carefully that it would need very little alteration actually to be incorporated into a Finance Bill and operated at once. It is a serious Clause which takes into consideration all the recommendations of the Royal Commission. It goes rather further than their recommendations in some directions, and it goes a less distance in others, but, on balance, I believe that it is a Clause which is absolutely required by industry in this country, and particularly demanded by those countries which use our hospitable City of London as their centre of world-wide operations, and which do so because they have reason to believe that our taxing system is fair and just. If they find that we do not go with the times and limit our imposition to the true income of these companies, we shall be running a very serious risk of losing them altogether.
    Sir HENRY BETTERTON: I rise merely for the purpose of commending very earnestly the principle of this Clause to the right hon. Gentleman representing the Government. I believe that this Clause is one of the most important Clauses which have appeared on the
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    Order Paper in connection with this Bill. It is particularly opportune that my hon. Friend the Member for Barnstaple (Sir B. Peto) should raise the question to-day, for two reasons. First of all, owing to the increase in the rate of Income Tax, it has become more important from that point of view. The other reason is, that we are told, and rightly, that the hope of industry in many directions lies in what is called rationalisation. Everybody knows that rationalisation is not merely the merging or the fusion of various concerns into one bigger whole, but that its value and importance lie very much more in the modernising and bringing up to date of the machinery, or whatever it may be, upon which a company depends for the production of profits. Therefore, it is to the interests not merely of the Treasury but also of industry that everything possible should be done in order to encourage that process, and to make it more likely to be adopted. Clearly, modernisation, whether it be of machinery, to which my hon. Friend referred, or whether it be of ships or what not, must come out of the accumulated profits, or, in other words, out of the accumulated resources.
    Therefore, if you tax the very fund from which your modernisation is produced, you are to that extent discouraging the very process you want to encourage. Taking the long view, it is in the interest of the Treasury itself that this process should be encouraged. My hon. Friend referred to machinery. There is an allowance, as we all know, for wear and tear, but the allowance under the existing scale is quite insufficient to encourage the process to which I have referred. This point arises not so much in the case of machinery which is worn out as in the case of machinery which is obsolescent, but which still has some life in it and, if not renewed, will continue, but which, if you wish to encourage the business, should be scrapped and new machinery put in its place.
    Perhaps the most striking instance we can possibly find with regard to the point I am endeavouring to make is to be found in the case of ships. Everybody knows that if a shipping company proceeded to raise money either by debentures or bonds every time they wanted to build a new ship, the company would be in the bankruptcy court in a very short time.

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    New ships, like machinery, must be provided out of accumulated reserves and out of accumulated profits if the company is to prosper. I will read a note I have extracted which exactly illustrates the point the hon. Baronet has in mind, and which is the one I wish to stress. It relates to the case of a shipping company. The note is as follows:
    "Obsolescence of plant and machinery. Steamer sold and replaced by another of a type more suitable for the particular concern. The appellants were the owners of eight steamships carrying coal from Newcastle to London. The steamers were purchased during the War when only standard pattern vessels were available, and in 1924 the appellants decided to replace them gradually with vessels to be built to their own specifications. The first new vessel was delivered in April, 1924, and one of the old vessels, 'Redriff,' which had been built in 1917, was sold in 1924. The new vessel was shown to be superior to 'Redriff' in speed, capacity, economy and on points peculiar to the appellants' trade, but it was admitted that in the ordinary course the 'Redriff' might have had many years of useful life before her. The special commissioners held that 'Redriff' had not become obsolete within the meaning of the Income Tax Act, 1918, and refused relief. The Judge held this decision must stand."
    There you have a direct illustration of the point which my hon. Friend was making. Where you have, as in this case, a ship—it might easily apply to machinery—which is not worn out, but which is obsolescent, and which it is necessary, in the interests of the company and of trade, to replace by another vessel, and the replacement can only come out of reserves, then I suggest to the right hon. Gentleman that it is not to the advantage of either himself, representing the Treasury, or of industry that a company should be subjected to the charge now placed upon it.
    Mr. W. GRAHAM: It is impossible to dispute the very great force of many of the contentions which have been used by the two hon. Members who have supported this Clause. The hon. Member for Barnstaple (Sir B. Peto) will remember that in other days—I think that it was during the Parliament of 1918 or later—he and I were sometimes almost alone in pressing for the consideration of wasting assets depreciation, obsolescence and kindred problems in this country. Therefore, I do not approach the Clause
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    this afternoon in any light way, and I will try, as briefly as possible, to describe the position as it now is, which, I am glad to think, is a little more hopeful, perhaps, from some points of view than the hon. Member indicated in his speech. It is plain to all of us, more particularly when we think of our industrial efficiency and try to relate this problem to employment, that it is desirable that there should be the greatest speed in the replacement of these wealth-producing machines in this country, and that provision should be made for wasting assets or for depreciation or for obsolescence.
    That matter was considered by the Royal Commission on the Income Tax in 1919 and the programme which the Royal Commission outlined was, roughly, in the following terms. I will not detain the Committee by going into it in detail; I will mention only the broad recommendations. First of all, it was clearly suggested that any plan which might be worked out under a Clause of this kind or on this subject should be confined to assets with a lifetime of less than 35 years. Anything over 35 years was definitely to be excluded. And then, in the next place, while the Royal Commission were quite unable to make a recommendation giving an allowance to the income from wasting assets at large—that is, in a broad or loose sense—they thought that it should be possible to work out plans, having regard to the period by which the life of an asset fell short of the 35 years. They went into certain other proposals, perhaps the most important of which related to the exclusion of any allowance for the exhaustion of natural resources, such as mines. Broadly speaking, this was their suggestion for consideration in dealing with wasting assets was one which, when the Royal Commission reported, my hon. Friend and I on several occasions joined in pressing the Government to consider.
    I understand well the vicissitudes to which reference has been made to-day. In 1924 when I was at the Treasury I promised that this matter would be considered in the following year but, unfortunately, we were driven from office in October of that year and in the five years following the country had not the advantage of our beneficent administration, so that it was not until 1929 that

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    we were able to take up the matter again, and some progress has been made. The Royal Commission rather indicated that if we were to try to deal with wasting assets we ought to look to the existing allowances that were given as depreciation allowances for such buildings as mills and so on. My own view has always been that if there was an attempt to deal with wasting assets on a large and comprehensive scale we might have to alter, if not to abolish, the existing depreciation allowances and replace them by some other device. I know that hon. Members sometimes consider that these allowances for depreciation are inadequate, but on certain types of buildings they do represent a substantial part of the annual value. I think they represent from one-sixth to one fourth of the annual value, the latter figure in regard to smaller buildings.
    What are the steps which have been taken during the past year? I think we can claim to have been carrying out to some extent the promise which was made in 1924. There has been consultation with the Federation of British Industries and the Associated Chambers of Commerce. I have not the least doubt that the conference began with the hope that a basis might be found for agreement in the recommendations of the Royal Commission on Income Tax in 1919 but, unfortunately, that appears not to have been the case. As I understand it, these industrial and commercial interests have opposed the time limit of 35 years and have also opposed certain other proposals, I think, relating to depreciation, particularly the exclusion of the natural resources, that is, mines or similar enterprises. They have made counterproposals which undoubtedly would make a large inroad on the revenue in existing conditions. Therefore, up to this point no agreement has been reached and the difficulties in discussion are undeniably considerable. I need not remind my hon. Friends of the great technical complexities which are involved. To cite only one case, if the time limit of 35 years were abolished we should be confronted with a task of making some kind of estimate of the life of all assets, and that would be by no means an easy task. I do not like to show an unsympathetic or obstructive attitude, because we are all agreed as to the importance of this subject relating to the speed in turning over
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    these assets, and the efficiency of industry and employment. Without committing the Chancellor of the Exchequer, which I am not in a position to do, to any precise proposal, I would express the hope that this consultation will continue and that together we shall seek as soon as possible to work out a programme which can be considered in a future Budget. Beyond that I am not able to go this afternoon, and I trust that my hon. Friends will see that certain steps have been taken in continuity of our promise of 1924.
    Sir B. PETO: In view of the right hon. Gentleman's promise and the statement that he has made that he is negotiating and intends to continue these negotiations, I beg leave to withdraw the proposed new Clause.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Silk duties.)
    Where any article of apparel made wholly or partly of silk is imported, the article, instead of being charged with duty in accordance with the provisions of Part I of the Second Schedule to the Finance Act, 1925, may, at the option of the importer, be charged with a duty calculated on the whole weight of the article at a rate equal to twice the rate of the duty chargeable under the said Part I in respect of the class of silk contained in the article.
    For the purposes of this sub-section—

    (i) the expression "silk" includes artificial silk;

    (ii) where silk of several classes is contained in the article, the article shall be chargeable with duty as if all the silk so contained were silk of that one of those classes in respect of which the highest rate of duty is payable under the said Part I;

    (iii) in determining the class to which any silk belongs regard shall be had to the stage of manufacture in which the silk appears in the article.—[Sir G. Rentoul.]

    Brought up, and read the First time.
    Sir GERVAIS RENTOUL: I beg to move, "That the Clause be read a Second time."
    I move this new Clause for the purpose of calling attention to what seems to me to be a very serious anomaly. This is rather a difficult matter to raise within the rules of Order. Therefore, I am not desirous of insisting on the actual wording of this particular Clause, which I think could be easily amended

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    and put into better form, but I do want to call attention to the grave anomaly and hardship that exists, and which tends to create a feeling of injustice in the minds of many traders in this country. The position with regard to the Silk Duties, so far as I am able to understand it, is that in 1926 a differentiation was made as to the amount of the duty payable and the basis of the assessment of that duty as between the trader and the private individuals. It was laid down that any private person who went to some foreign country, say, France, and bought certain articles containing silk and brought them back into this country, was required to pay duty only on the weight of silk contained in the articles, which in many instances amounted to a very small sum, whereas if a trader went abroad or if a business man in this country sent his buyer to France to purchase dresses or other silk articles, he was required to pay duty on the ad valorem value, which might amount in many instances to 20, 30 and even 100 times as much as the duty that would have to be paid by a private person on these same articles. I do not know why that differentiation was made.
    It is very difficult when one reads the discussion that took place at the time that the duties were imposed, to find any real justification for drawing such a distinction. As far as I am aware there is no parallel for such a differentiation being made in regard to any other class of goods. I should be interested to know if the Financial Secretary to the Treasury can tell us of any parallel case where a difference is made between the rate of duty that has to be paid by a trader and the duty which would be payable on that same article if introduced by a private person. Undoubtedly, this differentiation constitutes an anomaly and hardship and is in some ways detrimental to British trade. If any case can be made out for some concession being accorded to a private person, it certainly ought not to be anything like the divergence that now exists. It has a tendency to hamper trade and it has, as I know well from personal experience and from views that have been expressed to me by business people in this country, created a very real and justifiable sense of hardship in the minds of traders.
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    We are constantly told to buy British goods. Here is an inducement held out to people, who are able to afford it, to buy these goods in other countries, and to bring them into this country, and then they are only called upon to pay an infinitesimal amount of duty, instead of purchasing the goods, as they could and as they ought to do in this country, wherever possible, thereby helping British trade and employment. We are told that there are administrative difficulties that might arise with regard to this matter. I suggest that that is not a valid argument, when we bear in mind that all that is now being suggested is that the practice in this country should be the same as is adopted by the United States of America. They have a tax on goods purchased abroad containing silk material which are introduced into the United States. I understand that the procedure there is that the person importing those goods is required to produce the invoice from the business house or shop abroad where the goods were purchased, and on the amount of that invoice they pay duty. That is a system which seems to work perfectly easily and without any great complication or difficulty in the United States, and it is very difficult to see why the same system should not equally well prevail in this country. For these reasons, I move the Clause. The purpose—
    Notice taken that 40 Members were not present; Committee counted, and 40 Members being present—
    Sir G. RENTOUL: I hope that I have sufficiently brought to the notice of the Financial Secretary to the Treasury the purpose that I have in view in moving this new Clause and in calling attention, in the only way open to me, to the serious anomaly and injustice that exists. I think that purpose will commend itself to hon. Members, irrespective of the party to which they belong, and I hope that the Financial Secretary will give very careful consideration to the matter to see if he cannot arrive at some procedure which will remove from the minds of the traders carrying on business in this country, often under very difficult circumstances, a real sense of injustice and hardship.
    Mr. PETHICK-LAWRENCE: I have listened with a great deal of interest to

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    the hon. and learned Member for Lowestoft (Sir G. Rentoul), and I am not prepared to deny that there is something distinctly anomalous in the existing method of levying these duties upon silk imported in the ordinary course of business and imported by private persons. This concession was made in 1926 by the right hon. Member for Epping (Mr. Churchill), who was then Chancellor of the Exchequer. When they were first introduced we, who were then in Opposition, foresaw that duties of this kind, dealing with articles of everyday use, were bound to be inconvenient in many ways and would give rise to considerable difficulty. When they had been in force for a short time, the right hon. Member found that these difficulties did arise, that there was considerable administrative inconvenience in treating goods brought by private individuals from the Continent or sent by post from the Continent to this country on precisely the same footing as an ordinary importation of wearing apparel containing silk by the traders of this country. For that reason, the right hon. Gentleman found that it was necessary to make certain administrative changes which were embodied in the Finance Act, 1926. The hon. and learned Member for Lowestoft makes the only proposal which it is possible for him to make under the Rules of Order, and that is to bring the position of traders into line with that of private individuals. I gather that if he had been able he would have reversed his proposal and brought the position of the private individual into line with that of the trade, but that, of course, would be out of order.
    I am bound to consider the new Clause in the form in which it is moved. In the first place let me look at the cost to the revenue. It is anticipated that the cost of the alteration would be from £300,000 to £400,000 a year; a considerable change which, I am afraid, the Chancellor of the Exchequer cannot afford. But putting that out of account, let us see in what the hardship to the trader really consists. The trader has one or two alternatives. He may be bringing in wearing apparel, and if he is doing that he is not bringing in his whole stock-in-trade, but a Paris model for the purpose of copying it. As far as the individual Paris model is concerned, he is put to considerable greater Customs duty
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    than a private person bringing in an article to wear, but, on the other hand, when he proceeds to copy it and make it up out of the raw material, he escapes much more lightly, because in that case he only pays on the silk, and pays once instead of paying the double value which the private individual is forced to pay. Therefore, although there is an anomaly in the case of the actual Paris model as far as the great bulk of his work is concerned, he is much better off as against the private individual.
    The reason why we cannot go back and adopt the proposal in the 1925 Act, or the American system, is that it would cause great inconvenience to travellers. It is an easy matter in America, where people bringing in large consignments go into full details of the articles. It is a far different matter in respect of the cross-Channel traffic between this country and the Continent. It would delay the whole procedure at the ports if we were to insist in every case on the production of the invoice. A great deal of this trade is also a matter of sending through the post presents which might be quite small, and in these cases it is much easier to handle it in the way it is done than to revert to the 1925 system. For these reasons, because administratively we should find it difficult to go back to the 1925 system and because for the purposes of revenue, as long as we are to have Silk Duties, I am afraid we cannot sacrifice £300,000 to £400,000 per year, I cannot accept the Amendment.
    Mr. HOFFMAN: The Financial Secretary says that the great difficulty is in the matter of administration, but I can see no more difficulty in placing a value on dresses brought in than there is in valuing any cutlery brought from abroad. A declared value is to be made in that case and duty is paid accordingly, and from my experience there is no difficulty in the Customs Officers being able to put an approximate value on the dresses brought in. On the question of hardship, I say that the field of hardship is far wider than the Financial Secretary would have the Committee believe. I have been interested in the drapery trade. I was apprenticed to the silk trade, and in recent years have succeeded in organising the dressmakers in the West End

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    of London. It is a fact that this differentiation of duty has caused quite a large number of women to buy their dresses in Berlin or Paris whereas they used formerly to purchase them in this country. Numbers of dressmakers have been thrown out of employment. It is true that models are purchased abroad and brought into this country, but some traders are not so careful about the morality of the question and will take their assistants with them, purchase their models in Paris, and the girls will bring them back declaring that the dresses are for their own personal use. In this way they escape enormous duties.
    Let me give one or two examples. Here is the case of a dress of the invoiced value of £114 15s. 6d. The duty which the trader pays is £38 5s. 2d. The weight of the dress is four lbs., and the private person gets off with a duty of £3. Take another case. In this the value of the dress is £32. The trader has to pay a duty of £10, while the private person pays 8s. 3d. Take a further instance, where £27 was the price of the dress. The duty paid by the trader is £9, whereas the private person gets off with 6s. I suggest that this is putting a premium upon persons going to Paris, purchasing models and bringing them back here as their own property. It pays all the expenses over and over again. I am going a little further. In my humble opinion, these instances make me tremble very much as to what will happen in case of the success of Lord Beaverbrook's campaign for duties all round. If this is an instance of what happens when duties are imposed, that the rich can wangle them so much in the interests of their wives and friends, I wonder what is likely to happen if we have duties imposed upon everything brought into the country? These are instances of something which is grossly unfair and wrong. It is not right that there should be this differentiation.
    The only excuse given in 1926 was that the difficulty was to produce evidence as to the actual value of the goods brought in. That is now stated by the Financial Secretary as the reason for the continuance of these duties. If I bring in anything from the Continent, a present, a bottle of scent, I declare everything, and I am quite willing to leave it to the
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    good judgment of the customs officer as to whether I should be charged or not. I did so, on one occasion and I was charged 9s. 9d. duty on a bottle of Marc. I object to this preferential treatment on behalf of a few rich people. I would prefer to see it done away with altogether and I hope the Chancellor of the Exchequer, who is looking round for a few more sixpences, will be able to find a few on the backs of ladies when they bring these dresses home from the Continent. I hope he will remove this privilege next year.
    The CHAIRMAN (Mr. Robert Young): I understood it was a reduction which was wanted, not an increase.
    Mr. HOFFMAN: I was only suggesting that the Chancellor of the Exchequer should consider it for next year.
    Sir G. RENTOUL: I have achieved my purpose in getting a reply from the Government, and I beg to ask leave to withdraw the new Clause.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE.—(Amendment of Finance Act, 1928, s. 2.)
    Section two of the Finance Act, 1928, shall be read as if the following sub-section were inserted after sub-section (8):—
    If on an application made for the purposes of this sub-section, and in such manner as the commissioners may prescribe, by the Royal National Life Boat Institution, it appears to the satisfaction of the commissioners that at any time within the period of six months preceding the date of this application, or within such longer period preceding that date as the commissioners may in any special case allow, there has been used on board lifeboats or tractors for the purpose of exercise or in connection with any operation carried out with a view to saving life or property any quantity of hydro-carbon oil, the Institution shall be entitled to obtain from the commissioners repayment of any duty which has been paid in respect of the oil so used.—[Rear-Admiral Beamish.]
    Brought up, and read the First time.
    Rear-Admiral BEAMISH: I beg to move, "That the Clause be read a Second time."
    Lieut.-Colonel MOORE: I notice, Mr. Young, that you have passed over a new Clause in my name and the names of several other hon. Members. I am sure you have seen the implication behind it.
    The CHAIRMAN: I have seen the implication behind the hon. and gallant Member's proposal and behind all the new Clauses. If I proceeded on that line, I should select them all.
    Rear-Admiral BEAMISH: There are six names in support of this new Clause; I did not think it was necessary to get 607 other names, which I could have done. I am making this appeal on behalf of the Royal National Lifeboat Institution which does such remarkably good work on our coasts. In appealing to the Chancellor of the Exchequer I would remind him that the cost of this concession to the Exchequer would not be very great. Last year something like £500 or £600 was met by the Institution, and that sum goes a very long way towards the expenses of the Institution. It is a fact that in the past the Institution had the benefit of a rebate when the Petrol Duty was enforced some years ago, but by an oversight it was not included and was not given the rebate when the present tax was instituted. There has been a steady growth in the number of motor boats amongst the lifeboats around the coast. Last year over £100,000 was spent on the building of new motor boats, which, of course, use petrol. At the present time there are something like 80 motor boats stationed around the 5,000 miles of our coast, and 125 other boats which are either "pulling" or "sailing," or both. There will in future be an increase in the number of motor boats. That is natural in the present day of scientific progress. I think I can be absolutely positive, however, in saying that the cost to the Exchequer is never likely to exceed £1,000 a year. These motor boats vary in size and necessarily vary also in their consumption of petrol. They vary from 30 horse-power boats to vessels such as the biggest in the world which is to be named by the Heir to the Throne on Wednesday next at Dover.
    There are other points in favour of the new Clause. One in particular is that fishing vessels which use petrol are exempt from this tax. It must be remembered that the more service the lifeboats carry out, the greater is the burden of the tax. Lifeboats are not used at ordinary times as fishing boats are, but are used only for two purposes—for exercise or for service. That being so,
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    naturally it is to the interest of the Institution to keep down the expenses as far as possible. Notwithstanding that fact the Institution cost over £300,000 last year. I think I have said enough to show that the case is a good one for the lifeboats. There is another point of considerable importance. Modern science has provided the lifeboat service with a means of launching boats which was not heard of and certainly hardly dreamed of when I was a boy. That is the utilisation of what are called tractors. It may be that the Chancellor of the Exchequer thinks that these tractors are the ordinary machines that are seen on roads and are used for agriculture and so on. I would disabuse him of that idea, if he has it. These tractors are specially designed for this purpose. They are almost watertight, almost amphibious, and are capable of working on muddy, sandy or stony flat beaches where the water is very shallow, and whereas in the old days it was necessary to hire farm horses and there was great difficulty in using them in such difficult circumstances, nowadays these tractors can haul the lifeboat on its trolley into the water for launching in what would otherwise be impossible conditions.
    The tractors are never used for any other purpose whatever. They are not hired out; they are the property of the Institution and are used solely for the launching of the lifeboat. I will make the confession that occasionally the tractor is used for drawing a lifeboat around a town, such as Bridlington, in order to show the people the way in which lifeboats are handled and tractors worked. I would ask the Chancellor of the Exchequer, if he feels that he can accede to my request, to state whether the concession can be made retrospective. The ship of state is not particularly seaworthy at the moment. The lifeboat is no respector of creeds or politics, and in case of need will be only too glad to render all possible service to His Majesty's Government, and at least save their lives if not their administration.
    Mr. PETHICK-LAWRENCE: If the hon. and gallant Gentleman would allow me, I would like to congratulate him on the extremely able, moderate and fair speech that he has made. Of course, any

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    thing to do with the lifeboats appeals very much to all Members of this Committee. On the other hand, in this matter of the Petrol Duty my right hon. Friend has to harden his heart against rebates, in this direction or that, which will gradually wittle away the principle of the duty. The proposal contained in this new Clause may be divided into two parts. In the first place there is a proposal that the actual use of petrol on board the lifeboat should be free from duty by means of a rebate. In the second place it is proposed that the petrol used in the tractor should be free from duty. With regard to the first, we have already a rebate given to boats which are used for the purpose of fishing, and my right hon. Friend is prepared to view sympathetically the proposal to extend to lifeboats the rebate now given to fishing vessels. To that extent he is very glad to be able to meet the suggestion of the hon. and gallant Gentleman.
    With regard to the petrol used by the tractors he is afraid that the proposal goes beyond what he is prepared to concede. He feels that in that case he would be passing to a land usage and would be starting a new principle which would give rise to a number of other demands for concessions of a similar kind. What he has empowered me to do is this: If the hon. and gallant Gentleman is willing to withdraw his new Clause now, my right hon. Friend will put down an Amendment for Report, in carefully chosen words which will grant the rebate for the boat, for the petrol used an the boat, but he regrets that he will not be able to extend the concession to the petrol used by the tractor. The hon. and gallant Gentleman also raised the question of the concession being retrospective. I am afraid that we could not go as far as that. My right hon. Friend's Amendment will be framed to show that the concession is not retrospective, but applies to the future. In view of that statement, I hope that the hon. and gallant Gentleman will see his way to withdraw his Motion and Clause.
    Commander SOUTHBY: Before the Clause is withdrawn I would say how much we appreciate what the Chancellor of the Exchequer has promised to do in regard to the petrol used on the lifeboats. I would, however, make a further
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    appeal to him. The tractor is as much an essential part of the lifeboat service and the life-saving service as the engine in the boat itself, and therefore the argument that the tractor is a land machine, and that the Chancellor of the Exchequer cannot include it in his concession, really falls to the ground. There are only about 30 tractors in existence in the British Isles to-day. It is not as if there was a tractor at every lifeboat station. The concession asked for involves only a very limited number of these highly specialised machines, which are used for nothing else but the launching of lifeboats. I appeal to the Financial Secretary to say whether between now and Report he will reconsider the decision regarding tractors, which are just as much a part of the boats' gear as the engines or masts or sails inside the boats.
    Mr. E. BROWN: My father was the coxswain of a lifeboat for nearly 40 years. I would point out to the Financial Secretary that the case is not as broad as he seemed to think it is. It is in special cases where the boat could not be launched, either because of the configuration of the coast or when bad weather makes launching impossible in the ordinary way, that these particular engines are used. The concession can only apply, therefore, to a very few of these fine machines. While we welcome to the full the concession made with regard to the petrol used in the boats, I hope that when the Chancellor of the Exchequer goes into the matter again he will be able to go one step further and free this great lifeboat service from any tax on its operations.
    Major ROSS: There are one or two smaller considerations that I would bring to the notice of the Financial Secretary. There are cases where the tractor is used with boats which are not provided with engines but are propelled by oars. Thus, although the concession assists the modern station which is well equipped, to backward parts of the country where the crews have to go out under harder conditions and pull their boat with oars, no assistance will be given. I know that the Chancellor of the Exchequer wishes to assist the Lifeboat Institution as far as he can, but the concession so far promised will help

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    only the well provided modern stations. Even in those cases where you have a boat with a petrol engine and with a tractor, it is going to be a matter of considerable administrative difficulty. The small quantity of petrol used by the tractor will have to be stored separately from the petrol used for a different purpose, and will have to be purchased separately. I should not have thought it was worth making the distinction between the process of bringing the boat down to the water's edge, which is just as much a matter of life-saving, and that of propelling it through the water itself. I should have thought that the proper and convenient place to draw the line would be to rule that all petrol, whether for propelling the boat on shore or through the water to save life, should not have to pay duty, because one cannot imagine a higher purpose to which any machinery whether on land or sea could be put.
    7.0 p.m.
    Sir WALTER GREAVES-LORD: May I put this point of view to the Financial Secretary? He has expressed the view that to extend this rebate further than the actual lifeboat itself would be to open the door to other applications. Does he not realise that the whole matter of rebate here will be put forward by the one institution, which is interested only in the service of life saving at sea, and that that institution has no responsibility except life-saving at sea? In those circumstances, surely it is clear from all that my hon. Friends have said that the use of the petrol is confined to that service. It is in the hands of one institution, and that institution takes upon itself the responsibility of guaranteeing that that petrol has been used only in connection with definite and purely defined service. In those circumstances, cannot he say to the Chancellor that it is perfectly clear that this opens no further avenues of demand, and does not extend the matter one whit beyond the spirit and letter of the original concession? Can he give us an undertakina to consider it?
    Mr. PETHICK-LAWRENCE: I shall, of course, report what has been said to my right hon. Friend, but I cannot go further than what I have said, for the reasons I have given.
    Rear-Admiral BEAMISH: May I say one word before I withdraw my Clause? There has come into existence in recent years a type of lifeboat that is small and light and which, in view of the efficiency of the internal combustion engine, has replaced the old heavy sailing and pulling lifeboats on long stretches of flat beach in this country, miles from where any boat could lie on slips. The result is that this modern 35-foot motor lifeboat, which is now being used on the great flat stretches of open beach, is too heavy to be launched off the flat beach like the ordinary sailing and rowing boat. I do not say this will immobilise that type of boat, but it will add considerably to the expense of launching that type, which has been designed only in recent years If he will also make representations on that point to the Chancellor of the Exchequer, I shall withdraw the Clause on the understanding that it will be reconsidered.
    Captain PETER MACDONALD: I hope that the hon. Member will give us that undertaking. These boats have been working in practice in my constituency, and it is absolutely essential that they should have some means of mechanical traction to convey them into water sufficiently deep to enable them to come into operation. Although we appreciate all that the Financial Secretary has done, it is not asking too much to ask him to extend this remission to the tractors, or to any methods adopted to convey these lifeboats to the water. I hope that he will undertake to convey the very strong feeling on this side of the Committee and generally, that this matter should be considered. If he will give that undertaking, we shall all feel that he has done everything possible to meet this very great and urgent demand for help.
    Lieut.-Colonel Sir FREDERICK HALL: As the Chancellor has gone so far do not let us have any hair-splitting. Think of the difficulties that are involved! You are going to put the Institution into the position of having to say that so much petrol was used while the lifeboat was actually at sea and so much was used to get the lifeboat into the water. That is going to be a very difficult thing. As the Chancellor of the Exchequer has gone so far, the probability is that he has not had all the facts put plainly

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    before him. I am convinced that, after the speeches made and the manner in which the whole matter has been placed before the Government, they will give way on this point. When you have made a good bargain and done a generous thing, leave it and do not spoil it. I am always opposed to retrospective legislation, but I sincerely trust that the Financial Secretary will use his persuasion not only to tell the Chancellor of the Exchequer what has taken place, but will also use that charm that we love so well with the Chancellor of the Exchequer. If he does that I am convinced that the general wish of all parties in the Committee will be realised.
    Captain Sir BURTON CHADWICK: I do not know if the hon. Gentleman realises that all this development of motor propulsion of the lifeboat is a new and heavier charge on the lifeboat service. It is the story of the transition from sail to steam, and will become a great extra charge on the whole of the lifeboat administration. Having gone so far, why stop there? Why not include the whole of the service which is one service? I wish to reinforce what has been said and to ask the hon. Gentleman to press his right hon. Friend to include the whole service both tractor and lifeboat.
    Rear-Admiral BEAMISH: In view of all the appeals made and of what the Financial Secretary has said, I should like, with the permission of the Committee, to withdraw the Clause, but I would impress upon the Financial Secretary that the whole Committee agrees with the points put forward, and I hope he will impress that on the Chancellor of the Exchequer. Let us hope that on the Report stage, he will have found a point of view that will enable him to give way and let us have what we want.
    Motion and Clause, by leave, withdrawn.

    NEW CLAUSE—(Amendment of Rule No. 1 (General rule for estimating the annual value of lands, etc.) of Schedule A of 8 and 9 Geo. V, c, 40.)
    The following proviso shall be added to paragraph (2) of Rule No. 1 of Schedule A of the Income Tax Act, 1918—
    "Provided that (in the case of any land used for a plantation or a wood, or for the growth of saleable underwood)—
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    (a) if the land is used only for a plantation or a wood, the annual value shall be estimated as if the land instead of being a plantation or a wood were let and occupied in its natural and unimproved state;

    (b) if the land is used for the growth of saleable underwood the annual value shall be estimated as if the land were let for that purpose;

    (c) if the land is used both for a plantation or a wood and for the growth of saleable underwood the annual value shall be estimated either as if the land were used only for a plantation or a wood, or as if the land were used only for the growth of the saleable underwood growing thereon, as the general commissioners of the division may determine.—[Brigadier-General Clifton Brown.]

    Brought up, and read the First time.
    Brigadier-General CLIFTON BROWN: I beg to move, "That the Clause be read a Second time."
    This new Clause has been necessitated by recent legislation, and is only to make sure that the same system at present existing is carried out. I should like to point out how the necessity for it arose. If the Financial Secretary will look at the words of the proviso, he will see that they are taken straight from Section 4 of the Rating Act, 1874, and have always formed the basis of rating assessments. When the Rating and Apportionment Act, 1928, was brought in, that included land used for a plantation or a wood or for the growth of saleable underwood in the definition of agricultural land. By the same Act agricultural land is de-rated altogether. When the Local Government Act, 1929, was brought in, it was therefore repealed, and the Act provides that in subsequent valuation lists to that now in operation, no particulars shall appear with respect to agricultural land. It was not absolutely necessary for the Inland Revenue authorities to take the rating assessments, but, as a matter of fact, they always did and, those rating assessments having disappeared, the necessity arises, if you are going to carry on what has always been the practice, of having something for the Inland Revenue authorities to go by. If that basis of assessing woodland at its praries value is not to be kept in operation, the only alternative for the Inland Revenue authorities is to assess the land under Schedule A, which makes a very great difference. Under Schedule A it will be assessed at the full rental value

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    of the land and trees growing upon it, which is quite a revolution in the assessment of woodlands as carried out hitherto.
    Having regard to the depletion of woodland areas in the War and to what was said quite recently in this House in debate on the serious shortage of woodland to which we have to look forward in this country, everyone wants to encourage the growing of timber. If this annual assessment is to be increased to Schedule A instead of leaving it at the prarie value, it will discourage owners and even the Forestry Commissioners themselves, who have to rent land and do not want to pay more than the woodland rent. Assessment on that value will not be conducive to landowners to undertake more planting. It is with that object that I propose this Clause either for incorporation in the Bill as appears here, or in order to get an undertaking that the latter will be looked into and the prarie value still be maintained.
    Mr. PETHICK-LAWRENCE: I am sorry not to be able to accept the view put forward by the hon. and gallant Member. We estimate property generally on its annual value, and, so long as we take all the property of the country on that same basis, we are dealing equitably with the different classes of interests involved. But the moment we single out one particular species of property for differential treatment, however deserving it may be or whatever grounds there may appear to be for that distinction, we are adopting a new line—
    Brigadier-General BROWN: This kind of property has always been treated differently.
    Mr. PETHICK-LAWRENCE: I do not think the hon. and gallant Gentleman quite correctly states the position. We have hitherto had a rating which has formed a value which could be used by the Income Tax authorities in arriving at their value, but they have not been bound by that value. They have, in fact, been bound by the rule for estimating the annual value for the purposes of Income Tax and I fear that if we departed from the rule in one case, we would be making a discrimination which could not be upheld. If we discriminate in favour of certain taxpayers, we are discriminating
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    against others. In the circumstances we cannot possibly accept the proposed new Clause.
    Colonel LANE FOX: The object of this proposal is to secure that there will be no worse treatment of woodlands in this respect in the future, than there has been in the past. If the hon. Gentleman gives us an assurance that there is no intention of starting fresh or heavier taxation on woodlands, particularly on newly-planted woodlands, then our object will be achieved. I am sure the hon. Gentleman realises that any action taken by the Treasury, at this stage in the history of timber production in this country, would be very unfortunate if it had the effect of increasing the burden on this class of property, or starting a new system of taxation in relation to it which has not existed hitherto. I think the hon. Gentleman is not quite right in saying that there has been no differentiation in the past. I think he will find that there has been an inclination to treat woodlands lightly in this respect because of what has been so thoroughly recognised by previous Governments and by the authorities, namely, the desirability of not doing anything which would discourage the planting and maintenance of woodlands. All we want is an assurance that there is no intention on the part of the Government to discriminate against woodlands or to put on to them fresh burdens of taxation. If that were done, many people would not consider it worth while to start planting woodlands again and the effect would be disastrous. But I am sure that such is not the intention of the Treasury.
    Mr. PETHICK-LAWRENCE: There is no intention to make any drive for any additional sum of money. Of course, as the result of the change in the system of rating a greater burden of responsibility is put upon the commissioners to determine the value, but there is no intention as I say of starting a new drive or anything of that kind in order to increase assessments.
    Sir B. PETO: I hope that the hon. Gentleman in considering this question will bear in mind the great risk which people run, in planting woodlands, in the event of a season such as was experienced last winter, when great quantities of half-grown timber were struck down

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    wholesale by gales, involving owners in enormous liability, even to get the ground cleared for replanting, so as to start the whole process over again. That condition ought to be taken into account in assessing the value of these woodlands. It is easy to calculate that, say in 70 years, a larch will be ripe for cutting down; but there is no certainty that in 30 years' time the whole of the larches in that woodland will not be swept away by a single gale.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Reduction of death duty upon life insurance policies.)
    When an insurance policy payable upon the death of a person is included among the assets liable for duty upon the estate of that same deceased person the amount passing with his deceased estate by virtue of that same policy shall not be aggregated with his estate but shall be assessed for duty separately, and at half the percentage rate of duty applicable to the remainder of his estate, and as if the value of the aforesaid life policy were not aggregated to his estate.—[Mr. A. M. Samuel.]
    Brought up, and read the First time.
    Mr. ARTHUR MICHAEL SAMUEL: I beg to move, "That the Clause be read a Second time."
    This new Clause seeks to remove what has been in some degree and for some considerable time a clog upon life insurance. The Clause is intended to have, in the first place, a general effect, and then a particular effect. I suppose the Committee are aware that as a nation we are very much behind as regards the amount of insurance upon life in relation to our population. We have only a life insurance amount of £30 per head compared with £90 per head, or three times that amount in the United States. Estate Duty, as it now operates, hampers the progress of life insurance. I do not think it is necessary to insist on the view that life insurance is a very healthy thing, simply on the broad general ground of thrift; but in a particular sense it has the effect of being beneficial, not only to private individuals, but to the Exchequer. Life insurance helps the Exchequer and consequently helps the State very much. The premiums which are collected on life insurances are not simply put into a cupboard. For the most part our great British insurance offices
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    invest those premiums in high-class securities, principally trustee securities, and during the War they rendered the State immense service by the sums which they were able to place at the disposal of the State to meet the urgent requirements of that time.
    In times of peace these funds are also useful to the State because they keep up the capital value of Government and trustee stocks, and the higher the price of Government and trustee stocks, the better can the Exchequer make its conversions, the better the price it can get, and the more easily it can convert its loans. Of late years too the great insurance companies are beginning to feed industry with capital to a greater extent than heretofore. They are now putting money into industrial concerns and in this way helping in the reorganisation and rationalisation of industry. I know from my own experience, and I am sure the Financial Secretary also knows it, that when the Chancellor of the Exchequer seeks to convert a loan which is falling due, the Treasury receive great help from the insurance companies who come along with the premiums which they have collected and subscribe very large sums to help the Treasury to float its conversion loan.
    Finally, life insurance policies used for Estate Duty payments are very useful to the Treasury, because they enable the Exchequer to get in quickly and without difficulty, the moneys required for this form of taxation, and as shown by cases which have come under my personal notice in my private capacity, a life insurance policy very often helps the owner of a factory when his partner dies, it pays the death duties upon his partner's property in that factory, without reducing the employment given in that factory or interfering with its business. Therefore, not only upon the general lines of thrift but on all these particular lines of usefulness which I have mentioned and which converge upon the Treasury, we ought to do what we can to encourage the spread of life insurance. The amount of money which is involved in Estate Duty upon life insurance policies per year is, roughly, if I remember aright, £1,750,000. I think there is a sum of about £18,500,000 in life policies every year going into the Estate Duty net, on which the Exchequer receives about the sum which I have mentioned. I suggest that

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    the Exchequer might be content with half that amount or about £835,000. I submit this point in support of my argument:—I do not believe that at the present time in cases where these high duties operate it pays a man very well to insure his life for Estate Duty.
    If a man takes out a life policy not only for the general reason of thrift but for the particular reasons which I have already mentioned, for Estate Duty purposes, the amount of that policy is added on to the total of his estate, with the result that there sometimes is a higher rate of duty on the whole of the estate. For instance, there is the case of a man who leaves £50,000 and who has had a £5,000 life insurance policy. Had he not had the life insurance policy, the duty payable would be at the rate applicable to a £50,000 estate but with the addition of the policy it becomes a £55,000 estate, and that causes an increase in the rate of duty which wipes out the benefit of the insurance when the premium cost is taken into account. That state of things discourages life insurance; the increase in the rate of duty on the estate is also in addition to the Estate Duty on the policy money paid at death. That is a wrong state of affairs. The position in relation to life insurance and Death Duties at present is one which is not beneficial to the State, and it ought to be regularised. I do not know whether or not the Financial Secretary is empowered to accept either my new Clause or that in the name of my hon. Friend the Member for Barnstaple (Sir B. Peto)—[Proceeds of life policies not to be chargeable with Estate Duty]—which goes a little further, but I am perfectly certain that we need to increase the habit of life insurance, generally for provident purposes, and particularly in order to assist in the collection of these duties. As matters now stand, with Estate Duty at the present rate, it is as I have said, a clog upon life insurance, and I hope the Government will look into the matter.
    Sir B. PETO: I wish to put a specific case to the Financial Secretary which I think makes the argument for this new Clause almost unanswerable. I take the level of £100,000. According to the Second Schedule, an estate of £100,000 pays at the rate of 20 per cent. If the
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    person owning the estate desired to cover it in this respect by an insurance policy he would require a policy of £20,000. That policy is aggregated to the estate which makes the estate £120,000, and then the whole of the estate becomes chargeable with an additional 2 per cent. of duty—22 per cent. instead of 20 per cent. Therefore, the insurance policy of £20,000 is deficient to the extent of £2,000 in meeting the Estate Duty which ex hypothesi was £20,000. How does that work out? The improvident estate owner, whether he is the owner of a business or the owner of landed property, who does not care about keeping his estate intact, or his business running after his death, who does not care whether there is dislocation or not—
    It being Half-past Seven of the Clock, and there being Private Business set down by direction of the Chairman of Ways and Means under Standing Order No. 8, further Proceeding was postponed, without Question put.

  TORQUAY AND PAIGNTON TRACTION BILL [Lords]. (Certified Bill.) (By Order.)
  Order for Consideration, as amended, read.
  Motion made, and Question proposed, "That the Bill, as amended, be now considered."
  Mr. McKINLAY: I beg to move, to leave out the word "now," and, at the end of the Question, to add the words, "upon this day three months."
  Many hon. Members will wonder what connection a Glasgow Member has with a Torquay Traction Bill, but many of us have made it our deliberate purpose, since we were returned to this House, to watch Bills of this nature by reason of the fact that private and municipal Bills have been passed through this House in previous Parliaments to the detriment of the local ratepayers. We have been asked to oppose this Bill, not only on behalf of the 4,000 people who have petitioned against it, but on behalf of the organised labour forces in the Torquay Division. Some of my hon. Friends say that it serves Torquay right, because this Bill is not their only liability in the

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  House at this moment, but that is an argument which only Torquay people thmselves can settle.
  I would like to suggest that this Bill, introduced as a late Bill in March, has been hurried through its stages under the guise of a certified Bill. So far as that is concerned, it leaves some of us absolutely stone cold. We are gratified at the philanthropic outlook of the Torquay Tramway Company. We believe it is their desire to confer a boon on those who reside in Torquay and the surrounding district; we also believe that the present Torquay tramway system is obsolete, and that to make it an economic proposition additional capital expenditure is absolutely necessary, but we deny the right of the corporation to give its assent to abrogate the terms of a previous Act of Parliament, whereby the people of Torquay have the option to purchase this undertaking in 1935, without at least consulting the people of Torquay.
  There is one other reason for opposing the Bill, and that is that it confers on the Torquay Tramway Company the right to have a minimum fare of 1½d., and there is no provision made for facilities for working men; there are no workmen's tickets. When they suggest to us that the reason for introducing this Bill is, first, to provide employment for local people and, secondly, to confer on the people of Torquay a more up-to-date system than they have at the moment, we view such a claim with suspicion. I do not wish to take up the time of the House, but it is our intention to force this question to a Division.
  Mr. GEORGE OLIVER: I beg to second the Amendment.
  I do so, because I am interested in the principle laid down in this Bill. As in the case of my right hon. Friend who preceded me, it might be inquired why a Member from the Midlands is interested in a Bill promoted in Torquay, but I take it that Members in any part of the country have a right to be interested in private Bills in which monopoly powers are being conceded. This is not only a matter in which Members on this side are concerned, because I am glad to say that in the borough of Torquay there is a large number of other people, who do
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  not share our political views, who are equally concerned. I have received a letter from a very well known citizen of Torquay asking me to oppose this Bill, and he does not share my political faith. I ask on what grounds the ratepayers of Torquay desire this Bill to be opposed, and I find that there are very good reasons why the Tramway Company of Torquay and the present Town Council of Torquay should be particularly interested to introduce this Bill as a late Bill and get it through this House at the earliest possible moment.
  I understand that it will cost roughly £250,000 for the borough of Torquay to purchase the existing tramway system, and if they were to do that, it would be necessary to set aside something like 5 per cent. interest on capital and 4 per cent. interest on sinking fund, and in 20 years' time it would become the property of the Corporation. I understand too that that would entail an annual charge of something like £22,500, but when we come to look at the balance-sheet of this company, we find that the balance-sheet of 1928 shows that after they have paid £10,907 for upkeep, there is a gross profit of something like £29,000. Therefore, it is well understood that with a profit of £29,000 and an annual charge of £22,500 to the Corporation, a very handsome profit will be made and a substantial sum placed to reserve.
  The citizens of Torquay are quite seized of this information and are very much disturbed that we should contemplate taking away the power which will be theirs in 1935 to convert this private company into an asset of the Corporation. That is the reason that the ratepayers of that borough have promoted a petition asking us to oppose this financial ramp, as it has been characterised, and I ask my hon. Friends not to hesitate for one moment to reject this Bill, on the ground that it merely seeks to promote the principles of private monopoly, a monopoly which is created by the people themselves and the visitors to Torquay, and yet the whole of the value and the financial proceeds are to go into the pockets of a private company. I understand that in the last few years they have paid 10 per cent. We do not object to their paying 10 per cent., but we want to see that

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  interest coming into the corporation's own coffers and not going into the pockets of private shareholders.
  The people of Torquay want to know why the company and the present town council do not leave this matter to the people who will be in power in the local council chamber in 1935 to determine whether they should or should not exercise the option conferred upon them by this House in an earlier Act. Why this undue haste? There is no necessity for it, and if the people themselves do not know, I am sure that this House is not very competent to judge of that matter. If this Bill passes, it will mean that the Torquay Corporation will not be able to exercise its option till 1951, and, therefore, I ask not only my hon. Friends on this side but hon. Members opposite as well to say that this is a matter for the ratepayers of Torquay. If it is so urgent a matter, in view of the controversy which has been created in that borough, surely it was competent for the corporation, like other corporations, to submit the matter to a plebiscite of the town. They have not done that. They have merely forced the matter before this House in the hope that it would get through without criticism or with very little criticism.
  Mr. LAMBERT: As a Devonshire Member, with no interest whatsoever financially in this company—although, from what the last speaker said, I wish I had—I must ask the House to agree to pass this Bill. I have no knowledge of the merits of the case, except that I know that Torquay is a very beautiful town, but as to the merits of the tramway company or the question of purchase, I know nothing. I am going to speak on this question because I am a believer in self-government and that the Torquay Town Council know their own business. [Interruption.] If the hon. Member opposite thinks he knows better than the Torquay Town Council, I should think he is mistaken. The Torquay Town Council is elected by intelligent ratepayers, one presumes. After all, we Devonshire men have a fair share of common sense, and the Torquay Town Council have passed the resolution to promote this Bill by 24 votes to four. Surely they understand their own business, and I appeal to hon. Members opposite: Can
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  they go down to a town council and say, "You do not understand your business"? I know nothing of the merits of the case, I frankly confess.
  Mr. G. OLIVER: Do you know how many shareholders there are on the Torquay Town Council?
  Mr. LAMBERT: I have the figures here. I have read the case, but I have no personal knowledge of it. In regard to the shareholders, I understand there is one gentleman who holds 850 shares, and that he took no part in the negotiations with the company, nor did he vote at any meeting of the council when matters affecting the company were considered; and there are three other members who hold debentures. I want my hon. Friends to understand that we in Devonshire do not allow our private interests to interfere with our public duty. [Laughter.] That may excite mirth on the other side, but I can assure hon. Members that some of us do put our public duty before our private interests. The hon. Member for Ilkeston (Mr. G. Oliver) asked why the corporation did not submit this to a plebiscite of the ratepayers, but that brings us to the old device of the referendum. I submit to reasonable men on the other side of the House that the town council know their own job; if they do not, we cannot teach them. This Bill went before the House of Lords, and a House of Lords Committee passed it in all its stages.
  Mr. EDE: That is no recommendation to a Liberal, is it?
  Mr. LAMBERT: I am just giving a little information about the procedure. I do not approve of the House of Lords as a legislative assembly, but my hon. Friend will find, if he inquires, that the Private Bill Committees of the House of Lords are very good indeed. I have heard it over and over again from experienced Parliamentary counsel that the Private Bill Committees of the House of Lords are equal to those of the House of Commons. The House of Lords spent three days on this Bill, and passed it. The ratepayers who oppose the Bill went before the House of Lords Committee and put their case forward, but the Committee decided against them. Then it comes before this House, and the petitioners, I understand, prayed not to be

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  heard and did not ask for a Select Committee, but asked that the Bill should be thrown out on Third Reading. This Bill has been promoted by the Torquay Town Council, and they know their town, and if the House of Commons throws out such Bills as this on Third Reading, it will put an end to all municipal enterprise.
  Mr. G. OLIVER: Company enterprise, you mean.
  Mr. LAMBERT: Company enterprise, if you like. Hon. Members opposite and I may differ about Socialism, but their Socialism is a long way off, and they will realise that, if private enterprise is to be abolished, it will take a long time, and in the meantime Torquay people will not have their trolley tramways. A citizens league has been formed to oppose this Bill, but they had their opportunity at the last municipal election. I am speaking purely as a man who knows nothing of the merits of the case, and as one who believes that the Torquay Town Council are the best judges. I have no other title to speak than that.
  The alteration proposed will cost £132,000, and £70,000 will be spent in labour. Some hon. Gentlemen opposite, pursuing their Socialism, say, "We will not spend it." If it were not spent, it would mean holding up a necessary improvement, and I hope that hon. Members will not do it. I therefore ask the House to pass the Third Reading of this Bill: first, because it has been approved by the town council of Torquay; second, because it has been approved by a Select Committee of the House of Lords; and third, because it appears before this House as an unopposed Bill. If these are not reasons enough for the House to pass the Third Reading, I do not know what reasons will weigh with Members. I ask hon. Members not to turn down these proposals because of their political prejudices. I have political prejudices, but I do not allow them to come into this matter at all. If this is to be rejected, no improvement will be effected, and I appeal to hon. Members in fair play to give the Bill a Third Reading.
  Mr. EDE: I have an interest in this matter as one who has enjoyed a great many pleasant days in Torquay, and who has a brother-in-law living there, the
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  worst thing I can say about him being that he votes for the hon. Member for Torquay (Mr. C. Williams). Therefore, it can be assumed that, when we get down to the political issue, he is not likely to side with the party on this side of the House. He writes me a letter because he feels so strongly on the matter, and, as showing the views of a Conservative tradesman in the district, it ought to be made known to the House. He says:
  "The general feeling runs high against this Bill, and personally I cannot under stand why the present council or, shall I say a select few, are so opposed to the interests of the ratepayers as to concede such power as is proposed to a company. It was greatly against public opinion that the tramway company was first permitted to run trams, the earlier ones being on the old Doulter or Live-Stud principle, which was condemned by the Board of Trade somewhere about 1907. The option of the ratepayers to purchase the company in 1935 under the terms of the contract would without the slightest doubt be exercised"—
  that is, if the ratepayers had theirway; I am not talking of the town council—
  "and I cannot see why the ratepayers at that date can possibly be deprived of their rights under a contract made practically 30 years previously, the essential terms of which were that the right of the company to run trams was given in exchange for the option of the ratepayers to purchase at a given date. Surely the privity of contract is still a great point in British law. For your further guidance I enclose a cutting from to-day's issue of the Torquay 'Times.' and also the statement."
  I do not know whether the Torquay "Times" supports the hon. Member for Torquay on ordinary occasions, because there is nothing in the cutting to indicate its political opinions, but it heads its article—
  "Bitter Opposition to the Traction Bill. Determined attack promised on Third Reading. Tuesday's terrible fiasco. Where does Mr. Charles Williams stand?"
  From the temper of the article, there is no doubt that there is a considerable body of responsible opinion in the borough opposed to this Bill, which in some way or other did not have to receive the sanction of the ratepayers at a meeting and poll held under the Borough Funds Act. In consequence, the ratepayers as a body have had no opportunity of expressing their opinion. I have taken some trouble to ascertain that these views represent that of a substantial body of ordinary moderate opinion in the borough,

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  and in face of this attitude, it is highly desirable that this House should not take from the ratepayers of Torquay the option of using their right to purchase this company in 1935, when the present tenure of the company will expire.
  Mr. CHARLES WILLIAMS: I do not resent hon. Members on the other side opposing the Bill. We always welcome visitors to Torquay in whatever capacity, and we generally, after a short time, turn them into sane Conservatives. We do not resent their interference or interest in this matter. I have heard a considerable amount of the discussion on this matter in different ways, and have read more, but I have taken no part in the controversy, and have no direct or indirect interest in it. My point of view however, must be influenced by the fact that it is essential that on occasions such as this the local corporation can appeal to the local Member to put their case before the House of Commons. That is the only fair way in which the Member can look at it. Several points have been raised about the Bill, one of which interested me deeply; I was not entirely satisfied that the position of workmen's fares was safeguarded. I have looked up the Tramways Act of 1904, and I find in Section 34 (2) that if complaint is raised, the Board of Trade have to deal with the matter. Three other points against the Bill have roused a considerable amount of criticism. There is the question of the option to purchase in 1935, which I will deal with; there is the question of the lease being too long, with which I will also deal; and there is the question whether the town council have adequately considered the feeling of the town as a whole.
  Another question is, is there any definite need for the Bill? I do not think that hon. Members opposite would maintain that the tramways are an up to date system, but in the narrow streets of Torquay, and particularly on the road from Torquay to Paignton, it is essential to abolish the tram lines and everything in connection with them at the earliest possible moment. It is not a question as between motor omnibuses and trolley omnibuses; it is a question of the Bill as we have it. There has been a colossal growth in Torquay in the last few years. Over 2,000 houses have been built there, and a large number at Paignton
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  as well. With this colossal growth, is the House of Commons going to say that the town may not improve and modernise its traction? That is the first point which the House of Commons will have to answer quite clearly.
  8.0 p.m.
  The second point I want to put before the House is whether the town wishes to buy or whether it does not. They had the option to buy in 1921 and again in 1928, and as far as I know there was no movement among the ratepayers on either occasion in favour of buying. An hon. Member opposite said, "Look at the profits of the company." There are people looking at the profits to-day, but there are also a very large number of people who can remember when the company was not profitable, when it paid very, very little indeed; and taking both the long view and the short view, and having regard to the existing commitments of the town, I very much doubt whether, if there were a straight fight on the question of whether to buy or not to buy, there would be any practical support for buying, if the full figures were given. On the question of the actual voting, on the last occasion, on the council itself, there ware 24 in favour of this Bill and four against. That does not look as if there were any great movement for buying on the council itself. Outside, I admit there has been a great deal of talk on this subject.
  I will now come to the option, which runs out in 1935. Under this Bill the company are being asked to scrap £196,000 worth of capital and to expend £130,000 of new capital; in other words, this affects the company to the tune of well over £300,000. Can anyone imagine a company expending all this money with only four years of its lease to run? It would not be practical. I do not see how one could expect them to have got any less terms than they save got, approximately 21 years. Is that so very wicked? It is not. It is a perfectly ordinary case. I have here a list of towns which have extended the terms. The terms of the Nottingham and Derbyshire tramways has been extended to 1958. With the exception of one town, Gosport, 1951 is the shorter date; indeed, that is rather below the normal period. The towns I refer to are not all Conservative towns, or anything like it.
  The next point advanced has been that in 1935 the town might have got the

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  undertaking at a very advantageous rate, but it has been forgotten that the original Act lays down that when the town buys these tramways it, has to buy them at a fair value as a going concern. After what has happened, as far as I can see they could not be bought for less than about, £250,000. If, after all the figures which have been given, anyone still objects to the year 1951, I would refer him to the Act of 1904, under which a very much longer period was given. I had the date a moment ago, but I think, speaking from memory, 42 years was the period of the option then given them. I am not sure that that period of 42 years bas not got considerably mixed up in the minds of some people, and that when they realise that under this Bill the company are to get only 21 years instead of 42 a different view may be taken of the situation.
  That is the position as far as the Town Council are conerned. I have tried to put the view of the local authority, which by an enormous majority voted in favour of this change. It is no good putting off this question. Something must be done to reorganise the traffic conditions in the town. The local authority, in their wisdom, have decided on this method. I am not saying for one moment that there may not be better ways, but this is the way on which they have decided, and are we in the House of Commons to turn down the local authority, who have come to a decision after much thought and after having twice refused to exercise the option which was given to them? They have gone into this matter with great care on many occasions.
  There is another point which must be put, especially as I see the Minister of Transport is here. He will know that there is nothing unusual in the character of this Bill. Similar proposals have been put forward by other towns In their details these proposals must secure the approval of the Ministry of Transport. That fact in itself ought to be regarded as a certificate for the Bill, showing that it is necessary. It shows that the Minister has gone into the matter properly and efficiently—I would not dream of accusing him of not having looked thoroughly into the question.
  The MINISTER of TRANSPORT (Mr. Herbert Morrison): It had better be made
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  clear at once that I have expressed no opinion as to the fundamental question of public policy.
  Mr. WILLIAMS: I am very sorry if I was misrepresenting the Minister. As Minister he has to approve the details of the Bill, but not, the public policy. The public policy has nothing to do with him, but the details of the scheme, from a transport point of view, have to come before him, and I have yet to learn that his office has not given support to the Bill in its details. Another point is that this is a Bill which has been certified by the late Minister of Employment, the present Secretary of State for the Dominions, as a Bill which will provide employment and help industry, and that certificate shows that the Measure must have had the close consideration of the Government. The Bill comes forward under a new Order which we passed last November, which assists local authorities and Government Departments in facilitating the progress of any scheme which will provide employment. This Bill has been certified under that procedure, and purely from the point of view of providing employment I ask hon. Members opposite to hesitate before turning it down. It is a Measure which most give a large amount of employment not only in the locality but up country as well. If this Bill is turned down, one cannot possibly say what the effect may be on other local authorities, because they are watching to see what the House does in this case. Where a local authority is doing something to assist employment we ought to be very slow to discourage their enterprise. Therefore, I appeal to the House to weigh very carefully the action of the local authority. They have thought out this matter and have acted to the best of their ability, and it would not be wise for the House of Commons to turn down their action when they have been trying to assist in solving the unemployment problem.
  Mr. McENTEE: I think the hon. Member who has just sat dawn is, like myself, an occasional visitor to Torquay, but probably he has a more intimate knowledge of the town than I have; certainly he is more intimate with the members of the Corporation than I am. But I know the town and I appreciate the need for improvement, only I disagree entirely with the bargain which we

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  are asked to approve. The hon. Member for Torquay (Mr. C. Williams) said a capital expenditure of approximately £300,000 was involved.
  Mr. C. WILLIAMS: No. I am sorry if I did not make myself plain, but I said the Council were cutting out £196,000 and there would be new capital expenditure of £120,000. The total effect on the company will be well over £300,000.
  Mr. McENTEE: I accept that statement, but the point I wish to make is that those figures do not represent the truth, because if this Bill goes through there will presumably be a very considerable grant of public money which will enable the construction of this road to be undertaken at very much less cost than has been suggested.
  Mr. WILLIAMS: No.
  Mr. McENTEE: Some of the roads are first-class roads, and as such they will presumably get a grant from the county council. That is public money. It may be also that they will get a grant from His Majesty's Treasury, which again is public money. At any rate, I presume they will get the county council grant, and that will reduce considerably the sum which has been mentioned. Another point is that as a tramway undertaking the company are responsible for the maintenance of roads over which their lines run. I have read the Bill and I do not see that any compensation is to be paid to the Corporation for the relief from road maintenance which this company will secure if this Bill goes through. I know something about tramways, and I estimate that there may be an additional charge on the ratepayers of from £6,000 to £8,000 a year during the period from now to 1935. If this Bill goes through, the company will get larger fares than those which are at present fixed by Act of Parliament as the minimum.
  Sir DENNIS HERBERT: Is it not the case that the company are not liable for the upkeep of the roads, but only that there is a liability such as usually attaches to a tramway company which has to keep in repair a certain portion of the road on each side of the rails?
  Mr. McENTEE: The part of the road for which a tramway company is responsible
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  is the tramway track plus 18 inches on either side, and that generally means about two-thirds of the road.
  Sir D. HERBERT: Is that all that is involved in this case?
  Mr. McENTEE: Yes, it is a very considerable charge and one which might have cost the local council from £6,000 to £8,000 a year, so that for the next five years the company is relieved of that cost of maintenance, and no compensation is to be given to the people of Torquay. The sum involved is nearly £40,000, and under the minimum charges the company will be able to increase fares by about 10 per cent., and no compensation is to be given to the people of Torquay for the increased fares. The best of the bargain appears to be on the side of the company, and the public of Torquay are entirely ignored.
  I am not going to ask the House to consider the reasons which induced Torquay to enter into a bargain of that sort. My experience is that there are other things which often enter into bargains of that kind besides the public wellbeing, and I am suspicious that there may be something beside the public welfare in this proposal. I am forced to that view by my own experience, and the lack of compensation to the public of Torquay in the Bill as it stands. The new system will mean the development of new roads, and I presume the whole soheme will be new as compared with the worn-out system which exists to-day. The hon. Member for Torquay talks about there being a loss of £300,000 to the county. My opinion is that the new system and the new rates of fares will be worth a good deal more than a liability of £300,000.
  Mr. C. WILLIAMS: The company have to pay for the new system and they have to pay for the upkeep of the roads. They have to meet all those charges whether they are worth more or not.
  Mr. McENTEE: The company will have increased fares, and in addition to that they will have a complete monopoly of the whole of the passenger traffic for a number of years. They will also have many things for which no compensation is to be given to the town. The hon. Member for Torquay said that it would be a terrible thing if the House of Commons

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  turned down this Bill. I hope the Bill will be turned down, and that at the next election the ratepayers will be able to bargain with the company on a more equal basis than has yet taken place. The turning down of this Measure will mean postponing the Bill for another 12 months, and for these reasons I hope the House will reject the Bill, and give the ratepayers of Torquay an opportunity of coming together in order to obtain more consideration for the people of Torquay.
  Mr. E. BROWN: I came to the House to-night without having made up my mind as to which way I should vote in regard to this Bill, although I have had some considerable knowledge of the working of the tramways in Torquay. I think I have had as much experience of them as any Member of the House. I took some part in the original fight over the tramway system of Torquay in 1924, which resulted in favour of the running of the trams by the corporation and not by a company. On one occasion the original proposal was turned down by the Ratepayers League, after holding meetings in the old Public Hall and the Salvation Army Barracks. Twenty-six years after that the ratepayers of Torquay, at a public meeting, decided to reverse their previous decision. Nevertheless, like other hon. Members of this House, I must give due weight to the expressed view of any publicly elected body, although we may not go quite the same way as the hon. Member for Torquay (Mr. C. Williams). There are good grounds for talking about the never ending audacity of elected persons, whether they are in this House or members of corporations, and they are not always the repositories of all the wisdom in connection with any particular problem.
  I want to hear the case put forward by the corporation, and unless they can put forward better arguments in favour of the Bill, I shall be bound to go into the Lobby against it. The hon. Member for Torquay was rather specious in his pleadings, and he stated that the corporation had not exercised its option of purchase. The people do not desire that. The situation is entirely different at the present moment. It is one thing to ask, in the absence of any positive
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  proposal, to raise an agitation, and it is quite another thing to be faced suddenly, as in this case, with a definite proposal in regard to which you have to make up your mind at once for or against. That is what we are asked to do to-day.
  I have probably received more personal letters on this Bill from people in Torquay than any other Member of the House, with the exception of the hon. and gallant Member for Torquay. Considering all sides of this question there is no doubt whatever that a great change of this kind ought not to take place until there has been full discussion. This question was not discussed at great length at the last election, or at any rate if it was discussed, the local papers were singularly remiss in reporting the proceedings. I feel quite sure that a change of this kind should not be made without full discussion, and unless there are overwhelming arguments put forward in favour of the Bill, I am inclined to give the people of Torquay a chance of recording their votes on this question next November.
  I am by no means sure, knowing Torquay so well as I do, that the trolley tramway is the right solution of the difficulty. One of the main difficulties is that of Union Street. If I remember rightly the present tramway in that street is 7½ feet across. I understand that the new trolley tramway is to be 9 feet in width. I remember certain measurements being taken in that street, and there are points where it is only 22 feet across. I want the House to consider the position of two trolley tramways 9 feet across, that is 18 feet wide, being constructed in Union Street, Torquay, especially at that very difficult corner which we know as Market Street, where even now, with the track in the middle of the road, there is very great difficulty in conducting traffic satisfactorily. I am by no means sure that the trolley tram is the satisfactory solution, and unless I hear, before the debate ends, much more convincing arguments than I have heard already, I shall be bound to say that the case has not been proven for the corporation, and to ask that more light should be thrown upon it.
  With regard to the company, the hon. Member for Torquay really need not be

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  too tender. I am not againt private enterprise; I am not against the company; but the history of the company shows that it knows a good thing, and so do the ratepayers of Torquay, in the case of a monopoly of this kind. If it is such a good thing, they should be allowed to say whether they would care to exercise their option or not. I think that one point has been overlooked as regards the capital that the company is proposing to sink in this undertaking. It began with a surface contact system. It scrapped that, and, as far as I know, the apparatus for that original system is still under the roads; I never heard of its having been shifted. In that they sank something like £100,000 worth of equipment, but, even then, they were able to pay their way, and last year they paid a dividend of 9½ per cent. The interests of the company, therefore, need not over-burden the minds of hon. Members in this debate.
  The issues, as I see them, are two. In the first place, ought the ratepayers to have a chance to have this matter properly discussed when their elected representatives come to face them, and to put the arguments for and against? Secondly, if there is to be a change, ought it to be to a trolley system, or ought some other form of traction to serve the citizens of Torquay; and, in that case, ought this private company once more to have a monopoly of the traffic conditions of Torquay, or ought the people themselves to take over the undertaking? As far as this debate is concerned, no arguments have yet been put forward sufficient to give to me, a native of Torquay, what I should like to have, namely, the confidence to vote for the Corporation's resolution, and, therefore, unless something much more powerful is said, I shall vote against the Third reading of the Bill.
  Mr. McKINLAY rose in his place and claimed to move, "That the Question be now put," but Mr. DEPUTY-SPEAKER with-held his assent, and declined then to put that Question.
  Mr. MELLER: I think the House is really entitled to hear a great deal more in support of the Amendment than we have heard this evening. The Amendment was introduced in a very short statement, in which the Mover said in
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  the first place that he objected to the Bill on principle—he objected to monopolies—and, secondly, that he had a suspicion. If statements like that are going to be made, it is well that there should at least be some further explanation of what they mean. Let me examine for a moment the question of monopolies. One would have imagined that this was an entirely new company, entering into a bargain with the corporation in a town which had never had any mode of transport before; but, in fact, the company which has Lorne forward with this Bill has been in existence in the district for some 26 years, and to-day it seeks for some alteration in the position—for the introduction of a trolley system—not of its own volition, but because it has been approached by the corporation itself.
  I am not in the fortunate—or, perhaps, unfortunate—position of having received letters from individual ratepayers of Torquay; nor have I any relatives there who have confided to me their views on this matter; nor have I had the opportunities of gaining such knowledge as is possessed by the hon. Member for Leith (Mr. E. Brown), who has lived in Torquay and knows the earlier discussions on this subject; nor have I that deep knowledge which, I agree, has been put forward in a very pleasant, clear and reasonable way by the hon. Member for Torquay (Mr. C. Williams). I am endeavouring to view this Bill as an ordinary citizen, who has taken some part in local government work, and I ask myself whether, after a Bill has been considered in Committee, after the objectors to the Bill have had their opportunity of coming forward and giving their evidence and being examined upon it, this House is to say that the Bill is not a proper one to receive its Third Reading?
  What is the position? May I deal with one or two of the points which have been raised, and particularly one raised by the hon. Member for Leith? He felt some diffidence in considering the trolley system, because he understood that the trolley trams were to be nine feet wide. I have ascertained that the width is 7 feet 3 inches, and, that being so, perhaps his feelings on that subject will be allayed. Another question is that of fares. As a matter of fact, this Bill provides that the fares will be lower. Penny stages have been provided for,

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  and the minimum fare is to be 1½d. as against 2d. under previous conditions, while workmen's fares, I understand, are to be ½d. per mile; and the opportunities provided for the ratepayers to examine the matter have been very carefully watched and guarded in their favour.
  What was the opposition to this Bill? As I understand it, some strong opposition has been worked up by some newspapers. We can get great oppositions worked up by small and by great organs, and sometimes, when an attack is made, even by a great organ, it does not take very much to pierce its bubble. The hon. Member for South Shields (Mr. Ede) said that there had been great headlines in the local papers, but no doubt he has seen from his newspapers to-day that there was a case at the Surrey Assizes on Saturday last when an action for libel was brought because of the great headlines in a newspaper. The Court dismissed it. We are not going to be frightened by headlines, but are looking at the real substance—
  Mr. EDE: The verdict in that case was for the newspaper.
  Mr. MELLER: I am on the question of headlines. The question that we have to consider is this: We find that, with an electorate of some 30,000 people, after all this energy on the part of some of the objectors to the Bill, only some 4,000 people signed the petition, and 26,000 have not signed it. Against that you have to put the votes of the councillors themselves, not on one occasion, not just a snap vote, but on three separate occasions, with good intervals between—
  Mr. McENTEE: Will the hon. Member say whether the 26,000 who have not signed include children?
  Mr. MELLER: I have had before me an analysis of the 4,000 who voted, and, in the case of a good many, it was doubtful whether they could have signed either as ordinary electors or as local government electors; but, on the figures themselves, there were 26,000 who did not vote against the proposal. It is said that an elected council should have some regard for the views of the inhabitants. What has this council done? The proposal has been submitted to it, and it has been discussed on three occasions. The voting on the
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  first occasion was 24 to nil, on the second 24 to three, and, on the third, 24 to four. Is there in that voting, after all the discussions, after all the newspaper reports, and after all the agitation of which we have heard, anything to justify the council in saying that the question was so undecided, that there seemed to be so much doubt in people's minds, that they really ought to take the views of the electors? The corporation and this House have acted very wisely in taking the views of the people as best they could. Is it suggested that, on every question on which there may be some newspaper discussion, the council ought at once to obtain a plebiscite of the people? Those of us who have had some experience of local government work know that very many important matters are considered and decided by councils, and that there are very few occasions when they think the matter is so urgent that they ought to go to the electors and place the issue before them.
  In my view, the proposal which has been put forward here is very reasonable. First of all, the old scheme is admittedly a somewhat outworn mode of transport. The corporation said, "You ought to improve this. What are you prepared to do?" The company thereupon invited the council to view other systems. Some of the councillors had suggested omnibuses and, when they viewed the other systems, they came unanimously to the conclusion that the trolley system was the one. The details of the proposal were fully discussed by the council. The tramway company said, "These are our proposals. You have had an opportunity in the years gone by of taking over this scheme but you have not elected to do so." The council were not inclined to increase the rates in order to take up some problematic scheme. It is all very well to say this private enterprise has been successful but it does not follow because a scheme is taken over by a local authority, that it is going to show anything like the same profit. The people of Torquay are wise in their generation in saying, "Let these people, who have maintained the service and are prepared to bring it up to date, and who must listen if we ask for further improvement as science advances, have the scheme."

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  I have heard no argument against the Third Reading of the Bill. I hope, whatever prejudice hon. Members opposite may have against it, and whatever feelings they may have with regard to omnibuses, they will say, "Here is a Bill which has been subjected to every Criticism. Here is an opportunity of providing the men of Torquay with a considerable amount of work. Here is an opportunity of responding to the claim made by the late Lord Privy Seal to help local authorities to put works into operation." I beg those who have objections to the Bill to cast their prejudices aside and let it have its Third Reading.
  Sir D. HERBERT: I am as far from being interested in Torquay as anyone who loves the beautiful parts of the country can be. I have no particular interest in that part of the country, but there are two points of view that occur to me that ought to be considered by the many Members there must be who are in the same position as myself in making up our minds what we are going to do. One thing that strikes me very much is that this appears as a certified Bill, and I think a very strong case ought to be put, up against it before we throw it out. With the exception of the hon. Member for Leith (Mr. E. Brown), the opposition to the Bill appears to have come entirely from the party who were so anxious, and I believe responsible, for the introduction of a Bill only to-day to overcome obstacles put in the way of Bills of this sort which were certified as likely to increase employment. That is certainly a very strong case, and think we ought to have some guidance as to the importance of the Bill as a certified Measure from the Government.
  The other point of view that I want to put before Members in a similar position to myself is: What is the proper course for the House, as a House, to take with a Bill of this kind at this stage? Arguments have been adduced against it on matters of detail, one with regard to the liability of the company for the upkeep of roads, and there were other questions in regard to repairs. It was obvious, from the way the hon. Member dealt with the liability for the upkeep of roads and the replies he gave to my intervention, that that is one of the very points on which the House is likely to be misled unless the thing is thrashed
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  out very carefully indeed. Those are points which ought to be thrashed out, as they are in our practice, before a Private Bill Committee. I do not say that no one has a right to move to reject a Bill, but it is the duty of Members as a whole to support a Bill of this kind when it has been through the Private Bill Committee procedure unless there are some far greater objections to it than those which I have described as objections which ought to be properly fought out before a Committee. As I understand it, this matter was thrashed out most carefully before a Committee of the House of Lords, and there the opponents of the Bill failed. When it came before this House, perhaps knowing the valuable support they might get on the Floor of this House, they refrained from asking to be heard on their petition, and relied apparently upon opposition—
  Mr. McELWEE: On a point of Order. I think it is unfair to stigmatise people on the ground on which the hon. Gentleman is doing. The real explanation is that they could not—
  Sir D. HERBERT: Is this a point of Order or an interruption? I should not be asked to give way unless there is good reason for doing so.
  Mr. DEPUTY-SPEAKER (Mr. Dunnico): The point was not a point of Order, but the hon. Gentleman himself gave way.
  Lieut.-Colonel HENEAGE: May I remind you, Sir, what the hon. Member opposite said. He said that he was rising on a point of Order, and my hon. Friend had to give way.
  Mr. DEPUTY-SPEAKER: The hon. Gentleman knows perfectly well that if a Member rises to a point of Order, I must listen to it and then decide if it is a point of Order.
  Sir D. HERBERT: I should be the last not to give way to a Member who desired to interupt me if I had made a misstatement, or if he wanted an explanation, but I object on principle to this method of interrupting speeches under the guise of a point of Order. In those circumstances, I do not desire to be interrupted in my argument. When these matters have been thrashed out before a Committee of one House and the opponents have not claimed to be heard, but apparently endeavour to rely for their

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  success upon opposition on the Floor of this House, hon. Members of this House ought not to be persuaded to oppose the Bill by arguments which would more properly be put before a Committee. Unless they have a question of great political principle which is far beyond the type of question with which the Committee ought to deal, I say, as one who does not propose to go into the details of the rights and wrongs of this case, that it is my duty, and the duty of other hon. Members of the House in a similar position, to consider that all these Committee points have been properly dealt with by one of the most efficient tribunals of the kind existing anywhere. The Private Bill Committees of both Houses have the highest possible reputation for such work. It is our duty to support a Bill of this kind unless and until some great political principle has been put forward against it, which I do not regard as having been done in this case. Therefore, I desire at the moment to support the decision of the Committee before whom the opponents of the Bill were heard, and, consequently, to support the Bill.
  Having come to that conclusion, I ask that we should have a word from someone on the Government Front Bench as to the position in which this Bill stands as a certified Bill. I do not for a moment suggest that, because this is a certified Bill, therefore the Government are committed as a whole to support it, but I think that where this new procedure of certifying a Bill has been urgently asked for by the present Government and given to them willingly by the whole House, when that particular method of procedure is put into action, if a Bill thus certified is opposed, as apparently this one is by a very large number of their own supporters, they should at least give the House some guidance as to where they stand and what is the duty of those who may have no particular interest in this Bill one way or another. What is the duty of such hon. Members who are interested in the question of unemployment, and therefore interested in getting through as quickly as possible any Bills which are likely to assist in remedying unemployment, and what sort of weight ought we to give to that argument in this case?
  Mr. HERBERT MORRISON: It is not, in my view, obligatory for a Minister of a Department which may be indirectly involved to take part in a debate on a private Bill, and certainly I do not conceive it to be my duty on all private Bills to give the House definite advice one way or another as to what its course of action should be. But I have been asked by the hon. Member for Watford (Sir D. Herbert) to indicate to the House what, in connection with this Bill, is the significance of the certification which was given to the Bill upon ills introduction by the Lord Privy Seal. I must make it absolutely clear to the House that certification of a private Bill in no way indicates the approval or disapproval by the Government of that private Bill. All that certification does, is to say that this is a Bill, which, if passed, would provide a certain amount of employment, and for that reason it should be put into the category of Bills which, from the point of view of procedure, should be put into a privileged position and get, through that certification more rapid consideration than a Bill which is not no certified. Even if, in the opinion of the Government, the Bill was positively and clearly an outrageous Bill from the point of view of policy, so long as it was a Bill which would provide employment it would be certified, as that would be the category which the Bill should occupy. It might, therefore, be possible on a given occasion for a Minister who certifies a Bill from that point of view, definitely to advise the House to reject it. All that the certification does is to intimate to the House that employment is to be provided, and that, therefore, the Bill, from the point of view of rapidity of procedure should have all the advantages which certification gives.
  The House must not take it that certification by the Lord Privy Seal indicates the approval of the Government. Indeed, it would be wrong for the Government to put their seal of approval upon any private Bin, because that would interfere with the freedom of the Select Committee to deal with the Bill upon the evidence submitted to it. I hope that I have made that point clear, and to the satisfaction of the hon. Member and the House as a whole. We have listened to

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  the hon. Member for Torquay (Mr. C. Williams) in serious mood upon a serious subject to-night. I only hope that, in spite of the opinion held fairly freely of the activities of the hon. Member for Torquay in this House, Torquay will not suffer as a result of those activities. If they do they must hold the hon. Member responsible. At any rate, we are delighted to see him serious to-night, and I hope that it will not be the last time we shall see him serious in the House of Commons.
  Lieut.-Colonel HENEAGE: On a point of Order. Is it in order on a private Bill for a member of the Government to make what is practically a reflection upon the hon. Member for Torquay?
  Mr. DEPUTY-SPEAKER: I did not understand there to be any reflection upon the hon. Member for Torquay.
  Lieut.-Colonel HENEAGE: Surely, if an hon. Member speaking from the Front Bench fixes upon the hon. Member for Torquay and says that the House should not be held responsible, if, owing to him and to certain behaviour, which the hon. Member has not indicated, the Bill is lost, that is a reflection?
  Mr. DEPUTY-SPEAKER: That is a matter of opinion.
  Mr. HERBERT MORRISON: I am sure that even if the hon. and gallant Member for Lough (Lieut.-Colonel Heneage) has not a sense of humour, the hon. Member for Torquay has. This matter really resolves itself into one or two very simple points of public policy. The town council have adopted a certain policy. They had two opportunities to purchase tihe undertaking which they did not exercise. An opportunity will arise again in 1935, in advance of that date and in advance of the composition of the council at that time, they propose to commit themselves to a policy which will secure the conversion of the tramway undertaking to a trolley vehicle undertaking which they consider to be advantageous to the town, and, in those circumstances to forgo any rights of purchase until the year 1951. The House has to consider, in coming to a decision, whether the conversion of tramways to trolley vehicles in a town of the size of Torquay is an advantageous
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  thing. I do not know the particular circumstances of Torquay or the particular routes. On the whole, there is often much to be said in a town of a restricted size, other things being equal, for the elimination of the tramway, but that matter must be judged upon the particular circumstances of Torquay, and the House must weigh that fact in coming to a decision. If the House took the view that the tramways should be so converted, then it would have to consider, if the existing system remained until the date of purchase in 1935, whether the Corporation at that time would be likely to purchase the undertaking. Would public opinion be such that the Corporation would be encouraged to do so, and, if so, would it then undertake the responsibility of conversion?
  In considering these matters, the point which hon. Members have raised as to whether or not this matter has been an issue at town council elections, is a perfectly legitimate issue to raise and to take into account. I am not one of those who is enthusiastic about polls of ratepayers, and I would advise my hon. Friends not to embrace the nefarious and reactionary doctrine of the referendum. If Torquay had a poll of the town as to whether this tramway should be publicly or privately owned, I think it would be a very nasty sort of fight, where all concerns and interests would be involved. I believe in representative Government. I have not been converted to the Conservative doctrine of the referendum, and I am not certain that they have been converted. If the town council is going to make a fundamental departure in policy it is a material and legitimate point to raise as to whether it was an issue at the last municipal election, and whether the ratepayers would wish the matter to be postponed until it had become an issue at a municipal election. Upon the question of policy, that is a perfectly fair point to raise and to consider.
  In Committee I made a number of recommendations on points of detail, and I am bound to say that all those recommendations execept one were agreed to in Committee. I think those that were agreed to were agreed to with the concurrence of the company concerned. One point on which my view was not taken was the monopoly Clause, which protects the company from competition. The Parliamentary Committee in both Houses

  147
  in coming to their decision on this Bill, came to their conclusion against my view, as they had done on a series of municipal Bills this Session, in favour of the monopoly Clause. I took the view that with the Road Traffic Bill going through it was not proper to pass Clauses which would give monopolies either to companies or to municipalities. I suppose they did not know that the Road Traffic Bill would go through, and they wanted to be sure that in this Bill the monopoly should be given. If the Torquay Company scraps its existing capital of £200,000 and substitutes new capital expenditure of £132,000, it is an argument for protection against reckless competition by petrol omnibuses, which might endanger that capital. However, the Committee did not accept my view, and it did not accept my view in municipal cases as well as company cases.
  That is all the information that I can usefully give to the House. The Bill is before the House as a matter of policy, and the House must estimate as to whether the town of Torquay is likely, within a reasonable time, to have a Corporation that will go in for a policy of public ownership. That may be so or it may not be so. The House must estimate how far this is a matter of real controversy within the town of Torquay, and whether the citizens are entitled to expect from the House, irrespective of the town council, a decision that before this Bill goes through the citizens should have an opportunity of expressing their views, not by polls of the ratepayers or silly things like that, which really mean little, but whether they are entitled to express their view during the course of a municipal election, which is quite in accordance with the principles of representative Government.
  It is perhaps unfortunate that this Bill was allowed to go through the Second Reading without opposition. Either someone was not as awake as they ought to have been or there was some diversion of attention which ought never to have happened. If it had been my town this Bill would not have got a Second Reading so easily as it did. It went to the Unopposed Bill Committee upstairs, and therefore opposition at this stage is unusual. Nevertheless, hon. Members have before them now a clear-cut issue of public policy on which the House should
  148
  be ready to vote. So far as the Government are concerned we have no obligation in regard to this matter, nor do I exercise the right of advising the House one way or the other. So far as hon. Members are concerned on a Private Bill they must vote in accordance with their individual convictions.
  Sir D. HERBERT: May I ask the Minister of Transport to say whether I have rightly understood the answer which he gave to the question which I put to him. May we regard this Bill entirely without being influenced by the fact that it is a certified Bill?
  Mr. MORRISON: The point has been made in discussion that this is a Bill involving expenditure of £132,000 of new expenditure in conversion, and it is stated by the promoters of the Bill—I cannot answer for the figures—that £100,000, or 70 per cent. of that amount, will go in wages. That is a factor which the House must take into account in voting upon the Bill, and it is an important factor. What I want to make clear is that certification by the Government of a Bill only says that there is an employment factor in it. Therefore, if the Bill is to be passed it should be passed as quickly as possible, but certification must never be taken in any way to indicate approval by the Government of the policy contained in the Bill.
  Mr. E. BROWN: Is it not a fact of practical policy that if this Bill does not pass, the company will have to do a great deal of work on its present equipment?
  Mr. MORRISON: That point must be considered and set against the other considerations.
  Mr. MOSES rose in his place, and claimed to move, "That the Question be now put," but Mr. DEPUTY-SPEAKER withheld his assent, and declined then to put that Question.
  Sir B. PETO: Stricture has been passed upon some unnamed Members of this House that they were not wide enough awake on the Second Reading of this Bill. Is is not a fact that at that time we had appeals from the Lord Privy Seal to do nothing whatever to prevent the passing of these certified Bills? In those circumstances, it is very possible that a good many Bills went through without due consideration.
  Question put, "That the word 'now' stand part of the Question."
  The House divided: Ayes, 109; Noes, 222.

  Division No. 415.]

  AYES.

  [9.3 p.m.

  Acland-Troyte, Lieut.-Colonel.

  Forgan, Dr. Robert

  Morrison-Bell, Sir Arthur Clive

  Ainsworth, Lieut.-Col. Charles

  Fremantle, Lieut.-Colonel Francis E.

  Muirhead, A. J.

  Albery, Irving James

  Galbraith, J. F. W.

  Oldfield, J. R.

  Atkinson, C.

  Gardner, B. W. (West Ham, Upton)

  Oliver, P. M. (Man., Blackley)

  Balfour, George (Hampstead)

  Gill, T. H.

  Ormsby-Gore, Rt. Hon. William

  Betterton, Sir Henry B.

  Graham, Fergus (Cumberland, N.)

  Owen, Major G. (Carnarvon)

  Birchall, Major Sir John Dearman

  Granville, E.

  Penny, Sir George

  Bird, Ernest Roy

  Gray, Milner

  Peto, Sir Basil E. (Devon, Barnstaple)

  Birkett, W. Norman

  Greene, W. P. Crawford

  Ramsbotham, H.

  Blindell, James

  Grenfell, Edward C. (City of London)

  Rawson, Sir Cooper

  Bowyer, Captain Sir George E. W.

  Gunston, Captain D. W.

  Reid, David D. (County Down)

  Brown, Col. D. C. (N'th'l'd., Hexham)

  Hamilton, Mary Agnes (Blackburn)

  Ross, Major Ronald D.

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

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

  Russell, Richard John (Eddisbury)

  Buchan, John

  Heneage, Lieut.-Colonel Arthur P.

  Salmon, Major I.

  Buckingham, Sir H.

  Herbert, Sir Dennis (Hertford)

  Samuel, A. M. (Surrey, Farnham)

  Bullock, Captain Malcolm

  Hills, Major Rt. Hon. John Waller

  Samuel, Samuel (W'dsworth, Putney)

  Burgin, Dr. E. L.

  Hope, Sir Harry (Forfar)

  Sandeman, Sir N. Stewart

  Cadogan, Major Hon. Edward

  Hore-Belisha, Lesile.

  Somerset, Thomas

  Carver, Major W. H.

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

  Somerville, A. A. (Windsor)

  Cobb, Sir Cyril

  Hunter-Weston, Lt.-Gen. Sir Aylmer

  Somerville, D. G. (Willesden, East)

  Colfox, Major William Philip

  Hurd, Percy A.

  Thomas, Major L. B. (King's Norton)

  Colville, Major D. J.

  Hutchison, Maj.-Cen. Sir R.

  Tinne, J. A.

  Cowan, D. M.

  Jones, Sir G. W. H. (Stoke New'gton)

  Titchfield, Major the Marquess of

  Crichton-Stuart, Lord C.

  Jones, Henry Haydn (Merioneth)

  Todd, Capt. A. J.

  Croft, Brigadier-General Sir H.

  Jones, Rt. Hon. Lelf (Camborne)

  Turton, Robert Hugh

  Culverwell, C. T. (Bristol, West)

  King, Commodore Rt. Hon. Henry D.

  Wallace, Capt. D. E. (Hornsey)

  Davies, Dr. Vernon

  Knox, Sir Alfred

  Ward, Lieut.-Col. Sir A. Lambert

  Davies, E. C. (Montgomery)

  Leiqhton, Major B. E. P.

  Warrender, Sir Victor

  Dawson, Sir Philip

  Lewis, Oswald (Colchester)

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

  Edmondson, Major A. J.

  Long, Major Eric

  Wells, Sydney R.

  Elmley, Viscount

  Makins, Brigadier-General E.

  Windsor-Clive, Lieut.-Colonel George

  England, Colonel A.

  Margesson, Captain H. D.

  Withers, Sir John James

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

  Marjoribanks, E. C.

  Womersley, W. J.

  Ferguson, Sir John

  Meller, R. J.

  Fielden, E. B.

  Merriman, Sir F. Boyd

  TELLERS FOR THE AYES.—

  Foot, Isaac

  Mond, Hon. Henry

  Captain Bourne and Mr. Charles

  Ford, Sir P. J.

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

  Williams.

  Forestier-Walker, Sir L.

  Morris-Jones, Dr. J. H. (Denbigh)

  NOES.

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

  Cluse, W. S.

  Hayes, John Henry

  Addison, Rt. Hon. Dr. Christopher

  Cocks, Frederick Seymour

  Henderson, Right Hon. A. (Burnley)

  Ammon, Charles George

  Compton, Joseph

  Henderson, Arthur, Junr. (Cardiff, S.)

  Arnott, John

  Cove, William G.

  Henderson, Thomas (Glasgow)

  Aske, Sir Robert

  Daggar, George

  Henderson, W. W. (Middx., Enfield)

  Attlee, Clement Richard

  Dalton, Hugh

  Herrlotts, J.

  Ayles, Walter

  Davies, Rhys John (Westhoughton)

  Hirst, G. H. (York W. R. Wentworth)

  Baker, John (Wolverhampton, Blision)

  Denman, Hon. R. D.

  Hoffman, P. C.

  Baldwin, Oliver (Dudley)

  Dickson, T.

  Hollins, A.

  Barnes, Alfred John

  Dukes, C.

  Hopkin, Daniel

  Barr, James

  Duncan, Charles

  Hudson, James H. (Huddersfield)

  Batey, Joseph

  Ede, James Chuter

  Hunter, Dr. Joseph

  Beckett, John (Camberwell, Peckham)

  Edmunds, J. E.

  Isaacs, George

  Bellamy, Albert

  Edwards, C. (Monmouth, Bedwellty)

  Jenkins, W. (Glamorgan, Neath)

  Benn, Rt. Hon. Wedgwood

  Edwards, E. (Morpeth)

  Jowett, Rt. Hon. F. W.

  Bennett, Capt. Sir E. N. (Cardiff C.)

  Egan, W. H.

  Jowitt, Sir W. A. (Preston)

  Benson, G.

  Freeman, Peter

  Kelly, W. T.

  Bentham, Dr. Ethel

  Gibson, H. M. (Lancs, Mossley)

  Kennedy, Thomas

  Bevan, Aneurin (Ebbw Vale)

  Gillett, George M.

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

  Bowen, J. W.

  Glassey, A. E.

  Kinley, J.

  Broad, Francis Alfred

  Gossling, A. G.

  Kirkwood, D.

  Brockway, A. Fenner

  Gould, F.

  Lang, Gordon

  Brown, C. W. E. (Notts. Mansfield)

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

  Lansbury, Rt. Hon. George

  Brown, Ernest (Leith)

  Greenwood, Rt. Hon. A. (Colne)

  Lathan, G.

  Brown, Rt. Hon. J. (South Ayrshire)

  Grenfell, D. R. (Glamorgan)

  Law, A. (Rosendale)

  Brown, W. J. (Wolverhampton, West)

  Griffith, F. Kingsley (Middlesbro' W.)

  Lawrence, Susan

  Buchanan, G.

  Griffiths, T. (Monmouth, Pontypool)

  Lawrie, Hugh Hartley (Stalybridge)

  Burgess, F. G.

  Groves, Thomas E.

  Lawson, John James

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

  Grundy, Thomas W.

  Lawther, W. (Barnard Castle)

  Caine, Derwent Hall-

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

  Leach, W.

  Cameron, A. G.

  Hall, G. H. (Merthyr Tydvil)

  Lee, Frank (Derby, N. E.)

  Cape, Thomas

  Hall, Capt. W. G. (Portsmouth, C.)

  Leo, Jennie (Lanark, Northern)

  Carter, W. (St. Pancras, S. W.)

  Hamilton, Sir R. (Orkney & Zetland)

  Lewis, T. (Southampton)

  Chapman, Sir S.

  Hardie, George D.

  Lindley, Fred W.

  Charleton, H. C.

  Harris, Percy A.

  Little, Dr. E. Graham

  Church, Major A. G.

  Hastings, Dr. Somerville

  Logan, David Gilbert

  Clarke, J. S.

  Haycock, A. W.

  Longbottom, A. W.

  Longden, F.

  Phillips, Dr. Marion

  Snowden, Thomas (Accrington)

  Lowth, Thomas

  Picton-Turbervill, Edith

  Sorensen, R.

  Lunn, William

  Pole, Major D. G.

  Stamford, Thomas W.

  Macdonald, Gordon (Ince)

  Potts, John S.

  Stephen, Campbell

  MacDonald, Rt. Hon. J. R. (Seaham)

  Price, M. P.

  Stewart, J. (St. Rollox)

  MacDonald, Malcolm (Bassetlaw)

  Ramsay, T. B. Wilson

  Strachey, E. J. St. Loe

  McElwee, A.

  Rathbone, Eleanor

  Strauss, G. R.

  McEntee, V. L.

  Raynes, W. R.

  Taylor, R. A. (Lincoln)

  Maclean, Sir Donald (Cornwall, N.)

  Richardson, R. (Honghton-le-Spring)

  Thurtle, Ernest

  McShane, John James

  Riley, Ben (Dewsbury)

  Tinker, John Joseph

  Malone, C. L'Estrange (N'thampton)

  Riley, F. F. (Stockton-on-Tees)

  Townend, A. E.

  Mansfield, W.

  Ritson, J.

  Trevelyan, Rt. Hon. Sir Charles

  March, S.

  Romeril, H. G.

  Turner, B.

  Marcus, M.

  Rosbotham, D. S. T.

  Vaughan, D. J.

  Markham, S. F.

  Rowson, Guy

  Viant, S. P.

  Marley, J.

  Salter, Dr. Alfred

  Walkden, A. G.

  Marshall, Fred

  Sanders, W. S.

  Walker, J.

  Mathers, George

  Sawyer, G. F.

  Wallace, H. W.

  Matters, L. W.

  Scott, James

  Wallhead, Richard C.

  Messer, Fred

  Scrymgeour, E.

  Watkins, F. C.

  Middleton, G.

  Scurr, John

  Watson, W. M. (Dunfermline)

  Mills, J. E.

  Sexton, James

  Welsh, James (Paisley)

  Milner, Major J.

  Shaw, Rt. Hon. Thomas (Preston)

  West, F. R.

  Montague, Frederick

  Shepherd, Arthur Lewis

  Westwood, Joseph

  Morgan, Dr. H. B.

  Sherwood, G. H.

  White, H. G.

  Morley, Ralph

  Shield, George William

  Whiteley, Wilfrid (Birm., Ladywood)

  Morris, Rhys Hopkins

  Shiels, Dr. Drummond

  Whiteley, William (Blaydon)

  Morrison, Robert C. (Tottenham, N.)

  Shinwell, E.

  Williams, David (Swansea, East)

  Mort, D. L.

  Short, Alfred (Wednesbury)

  Williams, Dr. J. H. (Llanelly)

  Moses, J. J. H.

  Simmons, C. J.

  Williams, T. (York, Don Valley)

  Murnin, Hugh

  Simon, E. D. (Manch'ter, Withington)

  Wilson, C. H. (Sheffield, Attercliffe)

  Naylor, T. E.

  Sinkinson, George

  Wilson, R. J. (Jarrow)

  Palin, John Henry

  Sitch, Charles H.

  Winterton, G. E. (Leicester, Leughb'gh)

  Paling, Wilfrid

  Smith, Ben (Bermondsey, Rotherhithe)

  Wright, W. (Rutherglen)

  Palmer, E. T.

  Smith, Frank (Nuneaton)

  Parkinson, John Allen (Wigan)

  Smith, Bennie (Penistone)

  TELLERS FOR THE NOES—

  Perry, S. F.

  Smith, Tom (Pontefract)

  Mr. McKinlay and Mr. G. H. Oliver.

  Pethick-Lawreace, F. W.

  Snell, Harry

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

  Question put, "That the words 'upon this day three months' be there added."
  The House proceeded to a Division.
  Mr. MOKINLAY and Mr. G. OLIVER were nominated Tellers for the Ayes, but there being no if ember willing to act as Teller for the Noes, Mr. DEPUTY-SPEAKER declared that the Ayes had it.
  Consideration, as amended, put off for three months.

  FINANCE BILL.
  Again considered in Committee.
  [Mr. DUNNICO in the Chair.]

  FINANCE BILL.

    NEW CLAUSE.—(Reduction of death duty upon life insurance policies.)
    Postponed Proceeding resumed on Question, "That the Clause be read a Second time."
    Question again proposed.
    Sir B. PETO: The proceedings were interrupted by the decision of many hon. Members opposite that a Bill certified by the Lord Privy Seal as one exceptional
    152
    for the employment of those who were out of work, should not have a Second Reading—[Interruption.] I was pointing out, with reference to the new Clause moved by my hon. Friend the Member for Farnham (Mr. A. M. Samuel), that in an individual case it was more unjust to the wise and prudent man who desired the least possible interference with the course of his business or the management of his estate at his death, and who therefore provided for his death and the Estate Duties which resulted from it by an insurance policy, than even then had been put before the Committee. I take a case, according to the Second Schedule of the Bill, of an estate of £100,000, but for the purpose of my illustration I will assume that, as so often happens, the estate turns out to be a little more than the owner of it estimated that it would be.
    We will suppose that he dies, and that the estate is valued for probate at £101,000. That would pay Estate Duty at the rate, for £100,000, of 19 per cent., and the Estate Duty due would be £19,190. The owner of such an estate as that would say, "Roughly speaking, my estate is liable to £19,000 Estate Duty. It is my duty to take out a policy

    153
    for £19,000." Adding the £19,000, as is now done, to the estate of £101,000, you arrive at an aggregate for the estate of £120,000. The duty on that is 20 per cent. By adding the policy that is taken out to provide for Estate Duty (the proceeds of which are handed over to pay the Estate Duty) to the rest of the estate, the estate becomes liable for Estate Duty at 20 per cent. on £120,000, or a total of £24,000. So very nearly £5,000 additional Estate Duty goes to the Treasury, and only £14,000 of the original 219,000 insured remains to pay the Estate Duty.
    I say that such a state of things cannot possibly be left to go on, and in my view, whatever other Clauses or Amendments we may divide on, this is a matter of such injustice and so contrary to public policy—public policy which demands that provision should be made for these Estate Duties—that we must press it. The higher Estate Duties are raised the greater the dislocation of business at death, and the greater the impossibility of carrying on an estate, if it is a real estate, without the provision of insurance by a sum adequate to meet the demands of the Treasury on the death of the owner. That seems so obvious that I would like to see what it is that my hon. Friend the Member for Farnham asks for in his new Clause. I have on the Paper two Amendments going rather beyond what my hon. Friend proposes, and I am amazed at his moderation. What he says in effect is that the policy shall not be aggregated with the estate, but shall be assessed for duty separately at half the percentage rate of duty applicable to the remainder of the estate. I should have thought that my hon. Friend would have said that the result of the proceeds of the insurance policy should be taken as a separate estate, and that if any duty were to be charged upon it at all, in the hypothetical case that I have given, the rate appropriate to £19,000 would be charged. My hon. Friend offers the Treasury half of the 19 per cent.; he offers 9½ per cent. to the Chancellor of the Exchequer. The proper rate of Estate Duty on that aggregation would be only 8 per cent. My hon. Friend is, therefore, offering the Chancellor more than he is entitled to.
    Let me show the Chancellor of the Exchequer what he is getting under this
    154
    Clause. He would get Estate Duty on £101,000 at 19 per cent.,, that is £19,190. He would get Estate Duty on the proceeds of the policy of £19,000 at 9½ per cent., that is £1,805. The total Estate Duty, with the policy, would be £20,995, instead of £19,190 if the deceased had taken out no policy. So it is still to the advantage of the Treasury to the extent of £1,805. It seems to me that it is obviously in the interest of the Treasury, and it is certainly in the national interest, that people should be encouraged to insure for the payment of Estate Duties. What the Treasury is now saying to the taxpaying public is this. "If you are an imprudent fellow and do not care what happens to your successors, or to the business in which you have been engaged all your life, and if you do not care whether the business is to be carried on with adequate capital when you die, and the property is then worth £100,000, we will charge you only £19,000, but if you insure so as to provide for Estate Duty, we will charge you £24,000, and fine you £5,000." That is the present montrous position and it cannot be left where it is. We have a right to say that the Treasury must make up their minds whether it is in the interest of the taxpayer, of the Treasury and the country, that frugality and thrift, especially applied to the payment of Estate Duties, should, be discouraged. If it is not in their interests they ought to accept the new Clause.
    Mr. PETHICK-LAWRENCE: The hon. Member for Farnham (Mr. A. M. Samuel), who moved this new Clause, claimed that unless it were accepted the Government would not be paying sufficient attention to the question of life insurance, but his speech was very mild compared with the speech to which we have just listened.
    Sir B. PETO: I gave you facts.
    Mr. PETHICK-LAWRENCE: There are several ways in which a man can put by money for the purpose of saving and leaving his heirs in a position to face the future. One method is by life insurance, but it certainly is not the only method. Let me take, for example, the man who has a business and who, by saving and putting more and more money into the business, is building up his estate for his successors. That is exactly the same kind of thrift as that in the case of the

    155
    man who has not got a business, or the man who has got a business and does not attempt to increase it by saving, but who puts his money into life assurance. What the two hon. Gentlemen who have moved and seconded the new Clause seem to argue is that the man who saves by means of life insurance is a person much more worthy of consideration than the man who saves by other means. As a matter of fact, the Government already treats a man who saves by life insurance in a more favourable way, because, whereas a man who saves by means of increasing his ordinary investments has to pay the full Income Tax upon what he puts to increasing his capital, the man who saves by means of life insurance is allowed a peculiar form of exemption which is the statutory law of the land with regard to life insurance premiums. Let me quote to hon. Members opposite what was said in 1922 by the very distinguished lawyer who was at that time Solicitor-General, and who will be remembered by those who sat in the late Parliament as one who often made very effective contributions to debate. I refer to Sir Leslie Scott, and I am quite sure no one sitting opposite will deny his integrity and acumen in dealing with such questions. In the Finance Bill debate of 1922, this is what Sir Leslie Scott said:
    "One man may like to save by means of insurance and another by investments of a different kind. Why should one kind of investment be exempted from Death Duties and not another kind of investment? If it be suggested that the policy moneys, which of course, are part of the estate which passes at death, are to be treated as not being a part of the estate, then it is giving a very large exemption from Death Dusties to one particular form of investment"—[OFFICIAL REPORT, 28th June, 1922; col. 2213, Vol. 155.]
    I commend that very cogent statement to hon. Members opposite. I do not see why you should penalise a man who saves by putting money into his own business. I do not see why you should penalise the man who saves by building up the capital of the nation by direct investments. [Interruption.] An hon. Member says "Neither do we." But if you are singling out one special kind of investment and putting it in a very much more favourable position than all other forms, then to that extent you are penalising other forms of thrift.
    156
    What would be the effect of the new Clause upon revenue? Take the case of a man who takes out a very considerable life insurance—so much so that, when he comes to die, his estate of a total of £50,000 consists £30,000 of ordinary estate and £20,000 life insurance policy. What is his position? Under the present law, that man will pay Estate Duty on the whole £50,000; that is to say, at the rate of 14 per cent., but under the proposal of the hon. Member for Farnham we should have to divide the estate into £30,000 on the one hand and £20,000 insurance money on the other. The £30,000 would pay at the rate appropriate to that sum, namely, 10 per cent., and the £20,000 insurance money would pay only half, that is, 5 per cent. So that, instead of levying on the whole estate at 14 per cent., £30,000 would pay 10 per cent. and £20,000 5 per cent. That would involve very considerable loss to the Revenue, and for the reasons I have already explained I cannot for the life of me see why you should single out this particular form of thrift and put it on a pinnacle above all other forms.
    Moreover, the hon. Member for Farnham has fixed no limit to the working of the Clause, and supposing the estate had nothing but life insurance money, the effect would be that that man's estate would pay no duty at all. I cannot really think that that is his intention. A man may perfectly well leave £10,000 or £20,000, and yet have no other estate than insurance money for that amount. The Clause would have the effect of bringing no revenue at all to the State from such an estate as that. If you compare the position of that man with another man who has had very little opportunity of saving and has a few thousand pounds invested, I say it is most unfair that the man who had built up a considerable estate and left it at death in insurance money should be in that privileged position as against another man who had never had the chance of doing that and who left a considerable sum. I am afraid that we cannot accept this Clause, because we do not accept the principle which underlies it. I have endeavoured to show that so distinguished a lawyer as Sir Leslie Scott, whose opinions must hold weight on the other side of the Committee, took

    157
    precisely the same view on this question in the debate on the Finance Bill of 1922 as the present Government do now.
    Mr. A. M. SAMUEL: I am bound to say that the speech of the Financial Secretary has made me gasp. It consisted of nothing less from beginning to end than discouragement of, and pouring cold water upon, life insurance. I particularly pointed out, when moving my new Clause, that my reason was divided into two categories2014;that, generally, of thrift, and particularly in relation to Estate Duty. The hon. Gentleman has utterly failed to see the line I took, and which was taken by the hon. Member for Barnstaple (Sir B. Peto), which is that we are concerned mostly with life insurance policies as a form of saving for the purpose of finding liquid cash at death. What is the good of the hon. Gentleman talking as he has done, disclosing the danger of a man who has not been in business talking about business? Quite recently I acted as executor for a manufacturer who, except for a life insurance policy, had everything invested in trade. Why, we should have had the factory in ruins about our ears if we had had to take money out of the factory instead, as I am glad to say, of having a good fat life insurance with which to pay the Estate Duty. If that man had followed—if I may say it without offence—the foolish idea of putting all his money into the factory, then as executor I should have had to sell off stock, and, perhaps, buildings, and sacked some of the men and injured the very thing we wished to promote, namely, trade. This man had gradually accumulated £7,000 or £8,000 and instead of putting it into the factory and into stock-in-trade, he had taken out life insurance policies and with that money I and my co-executors were able to pay the money due to the State. What was the good of the money if it had been in the factory and not liquid?
    I ask the Committee to note that at the time when Sir Leslie Scott was a Member of this House things were very different. Conditions have altered since then as to the rate of Estate Duty. At that time the rate of Estate Duty which was operative upon a man's estate plus the duty on the life insurance policy, was not nearly as high as it is now, and at that time it would have paid a man to
    158
    take out a life insurance policy. To-day as my hon. Friend the Member for Barnstaple has pointed out, it often does not pay a, man to take out a life insurance policy under these conditions, because, when he has paid the premiums and when his estate has paid the increased percentage of duty upon the aggregate amount there is no advantage. The Financial Secretary has overlooked another point. The Chancellor of the Exchequer, with the help and sympathy of all of us, hopes to find himself in a position soon, to convert a very large amount of Five Per Cent. War Loan. The one thing which the right hon. Gentleman wants in that connection is a large volume of money in, the hands of the people who are likely to go into a Conversion Loan and it is better that there should be a large sum in the hands of the great insurance companies than [Laughter]. I do not know what the hon. Gentleman opposite laughs at. His laugh means nothing. There is nothing behind it. I am sure that the Chancellor of the Exchequer and the Financial Secretary to the Treasury from their experience know that no people helped Britain in finding the sinews of war more loyally than the insurance companies.
    Mr. TOWNEND: At a price—and a heavy price, which we are paying now.
    Mr. SAMUEL: In reply to that remark, let me quote the case of the great life insurance company for my native city the Norwich Union Company. I may say that I am not a director of that company. Whatever benefit that company got out of helping the Exchequer by finding money for national purposes, it did not go into the hands of shareholders but into the hands of the people whose savings that money represented.
    Mr. TOWNEND: Are the shares of the Prudential Company held in that way?
    Mr. SAMUEL: If one looks at the—
    Mr. TOWNEND: Can I have an answer to my question?
    The DEPUTY-CHAIRMAN: I am afraid we are getting away from the subject.
    Mr. SAMUEL: It is to the advantage of the Treasury to stimulate money being put into life insurance policies, because the life insurance companies are great

    159
    supporters of national finance. Finally, I submit this point. The Treasury has to make up its mind whether it wants men to take out life policies or not. As I have already pointed out, the cost of Estate Duty is much heavier now than it was when Sir Leslie Scott was in the House. A new condition of affairs has arisen and it no longer pays a man to take out a life insurance policy for the purposes of paying Estate Duty. [HON. MEMBERS: "Since when?"] I shall ask my hon. Friends to go into the Lobby in support of this new Clause if for no other reason than to let the country see that we are taking this matter very seriously, and although we cannot hope to beat the Government on this point, at any rate we intend to sound a note of warning so that those interested in these matters, especially the Treasury, may look into the question. I hope they will recognise the short-sightedness of their policy of discouraging life insurance. I hope it will be seen that to pursue that policy and to follow on the lines indicated by the Financial Secretary, would do a great deal more harm than good to the country.
    Mr. SMITHERS: My hon. Friend the Member for Farnham (Mr. A. M. Samuel) said that the reply of the Financial Secretary made him gasp. I prefer to leave my description of it a blank, because I am afraid it would be ruled out of order, but the hon. Gentleman's reply was so absurd that I feel bound to give a concrete example of the state of things which the new Clause is designed to remedy. We have had the old time-worn excuse of the Treasury, that the Government cannot afford this concession, but do not the Financial Secretary and the Chancellor of the Exchequer realise that by opposing this new Clause, as well as by many of the other actions which they are taking in this Finance Bill, they are killing the goose that lays the golden eggs? They are killing thrift and initiative. A friend of mine who is the head of a very large works employing thousands of men has taken out a life policy to cover his Estate Duty. The whole of his money is invested in that concern, and on his death, if he had not a life policy, part of that business would have to be liquidated to meet the Estate Duty. In that
    160
    eventuality a number of men would be put out of employment. He has deliberately taken out a policy in these bad times because he wants to stand by the men who are working for him.
    Mr. WALLHEAD: Could he not sell his shares to somebody else?
    Mr. SMITHERS: He has no shares. The whole of his money is in the business.
    Mr. WALLHEAD: I see—he has no balance.
    Mr. SMITHERS: Remarks such as that from hon. Members on the back benches opposite show the utter futility of those hon. Members in dealing with these questions. They do not understand the first thing about these matters. Here is a public-spirited man who, personally, would much rather retire from business, but if he did so it would mean that his works would be shut up and thousands of men thrown out of work. He has put, all his resources into this business to save the works until better times come and he is taking out a policy of insurance in order to try to prevent the liquidation of any part of the concern when the time comes for the payment of Estate Duty. The Government is penalising this man's thrift and his public spirited attempt to provide against the dismissal of men from employment in the circumstances which I have indicated.
    Mr. FOOT: Where is the penalty?
    Mr. SMITHERS: When this particular man has paid Income Tax and Super-tax and the premiums on his policies he has paid 23s. in the £ and he has to live on his capital.
    Sir B. PETO: The Financial Secretary to the Treasury said that the proposed new Clause would give special advantages to one form of thrift, namely insurance. From the Treasury point of view I submit that it would pay to give special advantages to that form of thrift. From the payment of Estate Duty point of view, it would pay, because it is the only certainty that you have got. The Financial Secretary suggested that the Estate Duty payer might just as well put his money into his business and make savings in other forms. Those are all liable to the fluctuations of trade, and they are all either more or less—very likely less—realisable

    161
    at the moment of death, but in a reliable insurance company the money is paid at death, and is liquid; and I defy the hon. Gentleman to point out to me any other form of savings or thrift of which that can be said.
    The rest of his speech was devoted to showing that my hon. Friend the Member for Farnham (Mr. A. M. Samuel) had omitted, from his perhaps hastily constructed Clause, something which I have in my Clause which would absolutely answer that point, namely, that all that we really ask for, and are entitled to ask for, are special terms for that portion of the insurance, whatever it may be, which
    is actually devoted to the payment of Estate Duty. Only two lines lower on the Paper—the hon. Gentleman must have seen it—he will find precisely the words necessary to put into this Clause. Why does he not say he will accept my hon. Friend's Clause, amended by the insertion of those particular words? We should be only too glad to compromise on those terms, but as he has offered no compromise, I hope my hon. Friend will press his Clause to a division.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 117; Noes, 265.

    Division No. 416.]

    AYES.

    [9.47 p.m.

    Acland-Troyte, Lieut.-Colonel

    Ford, Sir P. J.

    Nicholson, O. (Westminster)

    Alnsworth, Lieut.-Col. Charles

    Forestier-Walker, Sir I.

    Nield, Rt. Hon. Sir Herbert

    Albery, Irving James

    Fremantle, Lieut.-Colonel Francis E.

    Ormsby-Gore, Rt. Hon. William

    Atkinson, C.

    Galbraith, J. F. W.

    Peto, Sir Basil E. (Devon, Barnstaple)

    Balfour, George (Hampstead)

    Gibson, C. G. (Pudsey & Otley)

    Pownall, Sir Assheton

    Balfour, Captain H. H. (I. of Thanet)

    Graham, Fergus (Cumberland, N.)

    Ramsbotham, H.

    Beaumont, M. W.

    Greene, W. P. Crawford

    Rawson, Sir Cooper

    Betterton, Sir Henry B.

    Grenfell, Edward C. (City of London)

    Reid, David D. (County Down)

    Birchall, Major Sir John Dearman

    Gunston, Captain D. W.

    Reynolds, Col. Sir James

    Bird, Ernest Roy

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

    Roberts, Sir Samuel (Ecclesall)

    Bourne, Captain Robert Croft

    Haslam, Henry C.

    Ross, Major Ronald D.

    Bowyer, Captain Sir George E. W.

    Heneage, Lieut.-Colonel Arthur P.

    Russell, Alexander West (Tynemouth)

    Briscoe, Richard George

    Hennessy, Major Sir G. R. J.

    Salmon, Major I.

    Brown, Col. D. C. (N'th'l'd., Hexham)

    Herbert, Sir Dennis (Hertford)

    Samuel, A. M. (Surrey, Farnham)

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

    Hills, Major Rt. Hon. John Waller

    Samuel, Samuel (W'dsworth, Putney)

    Buckingham, Sir H.

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

    Sandeman, Sir N. Stewart

    Bullock, Captain Malcolm

    Hunter-Weston, Lt.-Gen. Sir Aylmer

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

    Cadogan, Major Hon. Edward

    Hurd, Percy A.

    Smith-Carington, Neville W.

    Carver, Major W. H.

    King, Commodore Rt. Hon. Henry D.

    Smithers, Waldron

    Cautley, Sir Henry S.

    Knox, Sir Alfred

    Somerset, Thomas

    Cayzer, Sir C. (Chester, City)

    Leigh, Sir John (Clapham)

    Somerville, A. A. (Windsor)

    Chapman, Sir S.

    Leighton, Major B. E. P.

    Somerville, D. G. (Willesden, East)

    Cobb, Sir Cyril

    Lewis, Oswald (Colchester)

    Spender-Clay, Colonel H.

    Cockerill, Brig.-General Sir George

    Little, Dr. E. Graham

    Stanley, Lord (Fylde)

    Colfox, Major William Philip

    Llewellin, Major J. J.

    Steel-Maitland, Rt. Hon. Sir Arthur

    Colman, N. C. D.

    Long, Major Eric

    Thomas, Major L. B. (King's Norton)

    Colville, Major D. J.

    Lymington, viscount

    Tinne, J. A.

    Courtauld, Major J. S.

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

    Todd, Capt. A. J.

    Crichton-Stuart, Lord C.

    MacRobert, Rt. Hon. Alexander M.

    Turton, Robert Hugh

    Croft, Brigadier-General Sir H.

    Maitland, A. (Kent, Faversham)

    Wallace, Capt. D. E. (Hornsey)

    Culverwell, C. T. (Bristol, West)

    Makins, Brigadier-General E.

    Ward, Lieut.-Col. Sir A. Lambert

    Dalrymple-White, Lt.-Col. Sir Godfrey

    Margesson, Captain H. D.

    Warrender, Sir Victor

    Davidson, Rt. Hon. J. (Hertford)

    Marjoribanks, E. C.

    Waterhouse, Captain Charles

    Davies, Dr. Vernon

    Meller, R. J.

    Wells, Sydney R.

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

    Merriman, Sir F. Boyd

    Williams, Charles (Devon, Torquay)

    Dawson, Sir Philip

    Mond, Hon. Henry

    Windsor-Clive, Lieut.-Colonel George

    Duckworth, G. A. V.

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

    Womersley, W. J.

    Edmondson, Major A. J.

    Morrison, W. S. (Glos., Cirencester)

    Ferguson, Sir John

    Morrison-Bell, Sir Arthur Clive

    TELLERS FOR THE AYES.—

    Fielden, E. B.

    Muirhead, A. J.

    Sir George Penny and Major the

    Marquess of Titchfield.

    NOES.

    Adamson, Rt. Hon. W. (Fife, West)

    Bennett, Capt. Sir E. N. (Cardiff C.)

    Brown, W. J. (Wolverhampton, West)

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

    Benson, G.

    Buchanan, G.

    Addison, Rt. Hon. Dr. Christopher

    Bentham, Dr. Ethel

    Burgess, F. G.

    Ammon, Charles George

    Sevan, Aneurin (Ebbw Vale)

    Burgin, Dr. E. L.

    Arnott, John

    Birkett, W. Norman

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

    Aske, Sir Robert

    Blindell, James

    Caine, Derwent Hall-

    Attlee, Clement Richard

    Bowen, J. W.

    Cameron, A. G.

    Ayles, Walter

    Broad, Francis Alfred

    Cape, Thomas

    Baker, John (Wolverhampton, Bilston)

    Brockway, A. Fenner

    Carter, W. (St. Pancras, S. W.)

    Baldwin, Oliver (Dudley)

    Brooke, W.

    Charleton, H. C.

    Barr, James

    Brothers, M.

    Church, Major A. G.

    Batey, Joseph

    Brown, C. W. E. (Notts. Mansfield)

    Clarke, J. S.

    Beckett, John (Camberwell, Peckham)

    Brown, Ernest (Leith)

    Cluse, W. S.

    Bellamy, Albert

    Brown, Rt. Hon. J. (South Ayrshire)

    Cocks, Frederick Seymour

    Compton, Joseph

    Knight, Holford

    Ritson, J.

    Cove, William G.

    Lang, Gordon

    Romeril, H. G.

    Cowan, D. M.

    Lansbury, Rt. Hon. George

    Rosbotham, D. S. T.

    Daggar, George

    Lathan, G.

    Rowson, Guy

    Dalton, Hugh

    Law, Albert (Bolton)

    Russell, Richard John (Eddisbury)

    Davies, E. C. (Montgomery)

    Law, A. (Rosendale)

    Salter, Dr. Alfred

    Davies, Rhys John (Westhoughton)

    Lawrence, Susan

    Sanders, W. S.

    Denman, Hon. R. D.

    Lawrie, Hugh Hartley (Stalybridge)

    Sandham, E.

    Dickson, T.

    Lawson, John James

    Sawyer, G. F.

    Dukes, C.

    Lawther, W. (Barnard Castle)

    Scott, James

    Duncan, Charles

    Leach, W.

    Scrymgeour, E.

    Ede, James Chuter

    Lee, Frank (Derby, N. E.)

    Scurr, John

    Edge, Sir William

    Lee, Jennie (Lanark, Northern)

    Sexton, James

    Edmunds, J. E.

    Lewis, T. (Southampton)

    Shaw, Rt. Hon. Thomas (Preston)

    Edwards, C. (Monmouth, Bedwellty)

    Lindley, Fred W.

    Shepherd, Arthur Lewis

    Edwards, E. (Morpeth)

    Lloyd, C. Ellis

    Sherwood, G. H.

    Egan, W. H.

    Logan, David Gilbert

    Shield, George William

    Elmley, Viscount

    Longbottom, A. W.

    Shiels, Dr. Drummond

    England, Colonel A.

    Longden, F.

    Shillaker, J. F.

    Foot, Isaac

    Lowth, Thomas

    Shinwell, E.

    Forgan, Dr. Robert

    Lunn, William

    Short, Alfred (Wednesbury)

    Freeman, Peter

    Macdonald, Gordon (Ince)

    Simmons, C. J.

    Gardner, B. W. (West Ham, Upton)

    MacDonald, Malcolm (Bassetlaw)

    Simon, E. D. (Manch'ter, Withington)

    Gibbins, Joseph

    McElwee, A.

    Sinkinson, George

    Gibson, H. M. (Lancs, Mossley)

    McEntee, V. L.

    Sitch, Charles H.

    Gill, T. H.

    McGovern, J. (Glasgow, Shettleston)

    Smith, Ben (Bermondsey, Rotherhithe)

    Gillett, George M.

    McKinlay, A.

    Smith, Frank (Nuneaton)

    Glassey, A. E.

    Maclean, Sir Donald (Cornwall, N.)

    Smith, H. S. Lees (Keighley)

    Gossling, A. G.

    McShane, John James

    Smith, Rennie (Penistone)

    Gould, F.

    Malone, C. L'Estrange (N'thampton)

    Smith, Tom (Pontefract)

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

    Mander, Geoffrey le M.

    Smith, W. R. (Norwich)

    Granville, E.

    Mansfield, W.

    Snell, Harry

    Gray, Milner

    March, S.

    Snowden, Rt. Hon. Philip

    Greenwood, Rt. Hon. A. (Colne)

    Marcus, M.

    Snowden, Thomas (Accrington)

    Grenfell, D. R. (Glamorgan)

    Markham, S. F.

    Sorensen, R.

    Griffith, F. Kingsley (Middleshro' W.)

    Marley, J.

    Stamford, Thomas W.

    Griffiths, T. (Monmouth, Pontypool)

    Marshall, Fred

    Stephen, Campbell

    Groves, Thomas E.

    Mathers, George

    Stewart, J. (St. Rollox)

    Grundy, Thomas W.

    Matters, L. W.

    Strachey, E. J. St. Loe

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

    Messer, Fred

    Strauss, G. R.

    Hall, G. H. (Merthyr Tydvil)

    Middleton, G.

    Taylor, R. A. (Lincoln)

    Hall, Capt. W. G. (Portsmouth. C.)

    Mills, J. E.

    Thurtle, Ernest

    Hamilton, Mary Agnes (Blackburn)

    Milner, Major J.

    Tinker, John Joseph

    Hardie, George D.

    Montague, Frederick

    Townend, A. E.

    Harris, Percy A.

    Morgan, Dr. H. B.

    Trevelyan, Rt. Hon. Sir Charles

    Hartshorn, Rt. Hon. Vernon

    Morley, Ralph

    Turner, B.

    Hastings, Dr. Somerville

    Morris, Rhys Hopkins

    Vaughan, D. J.

    Haycock, A. W.

    Morris-Jones, Dr. J. H. (Denbigh)

    Viant, S. P.

    Hayes, John Henry

    Morrison, Herbert (Hackney, South)

    Walkden, A. G.

    Henderson, Right Hon. A. (Burnley)

    Morrison, Robert C. (Tottenham, N.)

    Walker, J.

    Henderson, Arthur, Junr. (Cardiff, S.)

    Mort, D. L.

    Wallace, H. W.

    Henderson, Thomas (Glasgow)

    Moses, J. J. H.

    Wallhead, Richard C.

    Henderson, W. W. (Middx., Enfield)

    Murnin, Hugh

    Watkins, F. C.

    Herriotts, J.

    Naylor, T. E.

    Watson, W. M. (Dunfermline)

    Hirst, G. H. (York W. R. Wentworth)

    Oldfield, J. R.

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

    Hoffman, P. C.

    Oliver, George Harold (Ilkeston)

    Wellock, Wilfred

    Hollins, A.

    Oliver, P. M. (Man., Blackley)

    Welsh, James (Paisley)

    Hopkin, Daniel

    Owen, Major G. (Carnarvon)

    West, F. R.

    Hore-Belisha, Leslie

    Palin, John Henry

    Westwood, Joseph

    Hudson, James H. (Huddersfield)

    Paling, Wilfrid

    White, H. G.

    Hunter, Dr. Joseph

    Palmer, E. T.

    Whiteley, Wilfrid (Birm., Ladywood)

    Hutchison, Maj.-Gen. Sir R.

    Parkinson, John Allen (Wigan)

    Williams, David (Swansea, East)

    Isaacs, George

    Perry, S. F.

    Williams, Dr. J. H. (Llanelly)

    Jenkins, W. (Glamorgan, Neath)

    Pethick-Lawrence, F. W.

    Williams, T. (York. Don Valley)

    John, William (Rhondda, West)

    Phillips, Dr. Marion

    Wilson, C. H. (Sheffield, Attercliffe)

    Johnston, Thomas

    Picton-Turbervill, Edith

    Wilson, J. (Oldham)

    Jones, Henry Haydn (Merioneth)

    Pole, Major D. G.

    Wilson, R. J. (Jarrow)

    Jones, Rt. Hon. Leif (Camborno)

    Potts, John S.

    Winterlon, G. E. (Leicester, Loughb'gh)

    Jones, Morgan (Caerphilly)

    Price, M. P.

    Wise, E. F.

    Jowett, Rt. Hon. F. W.

    Ramsay, T. B. Wilson

    Wright, W. (Rutherglen)

    Jowitt, Sir W. A. (Preston)

    Rathbone, Eleanor

    Young, R. S. (Islington, North)

    Kelly, W. T.

    Raynes, W. R.

    Kennedy, Thomas

    Richards, R.

    TELLERS FOR THE NOES.—

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

    Richardson, R. (Houghton-le-Spring)

    Mr. A. Barnes and Mr. William

    Kinley, J.

    Riley, Ben (Dewsbury)

    Whiteley.

    Kirkwood, D.

    Riley, F. F. (Stockton-on-Tees)

    Question, "That the Clause be read a Second time," put, and agreed to.

    Mr. CHURCHILL: I beg to move, "That the Chairman do report Progress, and ask leave to sit again."
    I do not rise to move this Motion because I with to do anything but abridge
    164
    and expedite the proceedings, but we really must know beyond a peradventure, as President Wilson put it, what are the intentions of the Government, and we must make quite sure that there is no

    165
    misunderstanding of any sort or kind between the two sides of the Committee. We are trying to get on as quickly as we can, but we have been greatly blocked by the long discussion on the private Bill, and there remain only two hours before 12 o'clock for eight pages of proposed new Clauses. It will be extraordinarily difficult to press that in, but I agree that we must do everything in our power. Where does the Government stand in the matter? Are they prepared to facilitate in any way the clearing of the Order Paper up to the point where the proposed new Clause—(Relief to company reserves)—standing in the name of the hon. and gallant Member for North-East Bethnal Green (Major Nathan), appears on the Paper? That new Clause should come on in the early part of Wednesday's debate. That is our wish, and it is the wish of the Government. I do not know whether it is possible to get through the intervening business by 12 o'clock, even by not discussing it. The Government should make it perfectly clear that they will not attempt to discuss that proposed new Clause during the small hours of the morning, if by any chance the present programme falls through; otherwise, we may be quite sure that we shall carry the discussion round to two or three o'clock in the morning. Then there is the question of what is to happen after 7.30 on Wednesday. We had better have it out, because the right hon. Gentleman is always ready to say that we have broken agreements, and so on. There is this important proposed new Clause of the hon. and gallant Member for North-East Bethnal Green, and afterwards, the question of the assessment for Death Duties. I am not in a position to guarantee that the matter will be wound up at 7.30 on Wednesday, but we will do our best. We are with the right hon. Gentleman in the hope that the Committee stage should be put out of the way by Wednesday, but let there be no misunderstanding so that he can say that we have broken our word. There is no need for misunderstanding, and we will do the best we can.
    10.0 p.m.
    Mr. P. SNOWDEN: With the help that the right hon. Gentleman has offered, I think that we shall have no difficulty at all in getting to the proposed new Clause in the name of the hon. and gallant Member for North-East Bethnal Green
    166
    (Major Nathan) to-night. The right hon. Gentleman said that there are about eight pages of proposed new Clauses still on the Paper, but they are nut anything like so formidable as might be assumed from the space which they occupy on the Paper; one proposed new Clause alone occupies a page. I do not in the least wish to interfere with the complete discretion of the Chair in the matter, but, judging from precedent, it is hardly likely that every proposed new Clause on the Paper that has not been reached will be called. I think, therefore, that there is no reason at all why the remaining two hours up to 12 o'clock should not be quite sufficient to get to the point that I have indicated. A number of the proposed new Clauses which occupy a considerable space on the Paper ought not to lead to any discussion, because I am prepared to accept them, so that I think that in the next two hours we shall have ample time to get to the point which I have indicated. I am as anxious as the right hon. Gentleman that we shall be free for the discussion of the proposed new Clause in the name of the hon. and gallant Member for North-East Bethnal Green at the beginning of the proceedings on Wednesday. As to the finish of the Committee stage, if we work with as much harmony as possible, we ought to get the end by about 7.30 on Wednesday—but I will not say to half-an-hour more or less—so that we may be able to deal with the Lords Amendments to the Coal Mines Bill. I think what I have said will be quite satisfactory to the right hon. Gentleman.
    Mr. CHURCHILL: I do not think we can say more than that we will do our very best to facilitate the business. I beg to ask leave to withdraw my Motion.
    Motion, by leave, withdrawn.

    NEW CLAUSE.—(Relief from transfer stamp duty in case of transfer of property as between associated companies.)
    (1) Stamp duty under the heading "Conveyance or Transfer on Sale" in the First Schedule to the Stamp Act, 1891, shall not be chargeable on an instrument to which this section applies:
    Provided that no such instrument shall be deemed to be duly stamped unless either it is stamped with the duty to which it would but for this section be liable or it has in accordance with the provisions of section twelve of the said Act been stamped

    167
    with a particular stamp denoting either that it is not chargeable with any duty or that it is duly stamped.
    (2) This section applies to any instrument as respects which it is shown to the satisfaction of the Commissioners of Inland Revenue—

    (a) that the effect thereof is to convey or transfer a beneficial interest in property from one company with limited liability to another such company; and

    (b) that either—

    (i) one of the companies is beneficial owner of not less than ninety per cent. of the issued share capital of the other company; or

    (ii) not less than ninety per cent. of the issued share capital of each of the companies is in the beneficial ownership of a third company with limited liability.—[Major Nathan.]

    Brought up, and read the First time.
    Major NATHAN: I beg to move, "That the Clause be read a Second time."
    This Clause takes some 20 lines to express what is, in fact, a very simple proposition. It has been found in practice that there is a gap in the provisions of the law on the remission of stamp duties in the case of amalgamations. The object of the Clause is to secure that when an amalgamation is in existence and transactions are to take place for the reorganisation of the businesses of that amalgamation within the limits and the scope of that amalgamation, no stamp duty shall be charged upon the transfers necessary for that purpose. I should be prepared to argue this matter at length, but I leave it where it stands, because I understand that it is not unlikely to receive sympathetic consideration from the Chancellor.
    Mr. P. SNOWDEN: I am quite prepared to accept this new Clause.
    Clauses added to the Bill.

    NEW CLAUSE.—(Amendment of s. 32 of 11 and 12 Geo. V, c. 32.)
    Section thirty-two of the Finance Act, 1921, which grants exemption from income tax in respect of the income of certain superannuation funds shall have effect as if for paragraph (b) in sub-section (3) thereof there were substituted the following paragraph:—
    (b) The fund has for its sole purpose the provision of annuities for all or any of the following persons in the events, respectively,
    168
    specified, that is to say, for persons employed in the trade or undertaking either on retirement at a specified age, or on becoming incapacitated at some earlier age, or for the widows, children, or dependants of persons who are or have been so employed on the death of those persons.—[Mr. Romeril.]
    Brought up, and read the First time.
    Mr. ROMERIL: I beg to move, "That the Clause be read a Second time."
    This proposal has been before Parliament on a number of occasions, and I will not detain the Committee long about it. There are funds in existence for the purpose of providing pensions for the members of such funds. There are other funds that exist for the purpose of providing annuities and allowances for the widows, orphans and dependants of the members of the fund. The first class of funds enjoy exemption from income tax on their investments, the view taken being that a double income tax should not be charged. That exemption was not extended to funds of the second class, and this Clause proposes to grant such exemption. I do not think there is any dispute as to the identical character of the funds. As the principle of exemption has been accepted for the first class of funds, in justice and in equity it should apply to the other funds. I moved this new Clause in 1924, and the present Chancellor, while expressing his sympathy with it, said he was unable to grant the concession then but undertook to try to do so in the next Budget. I am exceedingly hopeful, therefore, that he will be able to do it tonight.
    Mr. P. SNOWDEN: I am glad to be able to offer my hon. Friend something more than sympathy on this occasion. I am prepared to accept the Clause.
    Clause added to the Bill.

    NEW CLAUSE.—(Computation of amount of copyright royalties taxed by deduction.)
    (1) Where any payment to which section twenty-five of the Finance Act, 1927, applies (which section provides for the taxation of copyright royalties by deduction in cases where the usual place of abode of the owner of the copyright is not within the United Kingdom) is made through an agent resident in the United Kingdom, and that agent is entitled as against the owner of the copyright to deduct any sum by way of

    169
    commission in respect of services rendered, the amount of the payment shall for the purpose of Rule 21 of the General Rules be taken to be the amount thereof as diminished by the sum which the agent is so entitled to deduct:
    Provided that, where the person by or through whom any such payment is made does not know that any such commission is payable or does not know the amount thereof, any tax deducted by or assessed and charged on him shall be computed in the first instance on, and the account to be delivered of the payment shall be an account of, the total amount of the payment without regard being had to any diminution thereof, and in that case, on proof of the facts to the satisfaction of the special commissioners, there shall be made to the agent on behalf of the owner of the copyright such payment of tax as is proper in respect of the sum deducted by way of commission.
    (2) Sub-section (1) a this section shall apply to payments made after the fifth day of April, nineteen hundred and thirty, and any tax deducted in relation to any such payment made before the passing of this Act in excess of the tax which it would have been proper to deduct if this section had been in force shall be made good, and, on proof of the facts to the satisfaction of the special commissioners, any corresponding excess of tax which has been paid shall be repaid.
    (3) The time of the making of a payment to which section twenty-five of the Finance Act, 1927, applies shall, for all the purposes of the Income Tax Acts, be taken to be the time when it is made by the person by whom it is first made and not the time when it is made by or through any other person.—[Mr. Matters.]
    Brought up, and read the First time.
    Mr. MATTERS: I beg to move, "That the Clause be read a Second time."
    I understand the Chancellor of the Exchequer is willing to accept this new Clause. It is merely of a machinery character, and therefore I will content myself with formally moving it.
    Mr. P. SNOWDEN: This is a proposal which does not cost a great deal of money but which will remove an injustice which is felt by a number of people, and I therefore have pleasure in accepting it.
    Lieut. - Commander KENWORTHY: May I ask how much this concession will cost? Earlier this evening the right hon. Gentleman resisted an Amendment which would not have cost very much.
    Mr. SNOWDEN: It is very difficult to say exactly. It may be some hundreds, or one or two thousand pounds.
    Clause added to the Bill.

    NEW CLAUSE.—(Amendment of Income Tax Act, 1918.)
    The following paragraph shall be added to Schedule A, No. VIII, of the Income Tax Act, 1918:—
    12. No claimant for repayment or allowance of tax under this rule shall be entitled to claim or be allowed repayment or allowance of tax unless and until he shall produce to the person from whom he is claiming repayment or allowance a receipt or certificate to prove that he has paid or suffered the tax, repayment, or allowance for which he is claiming.—[Major Hills.]
    Brought up, and read the First time.
    Major HILLS: I beg to move, "That the Clause be read a Second time."
    This Clause deals with a simple but rather important point. A tenant who pays the property tax on his house has the right to deduct the amount of the tax from his rent, the charge being really one upon the landlord. Hitherto there has been no necessity for the tenant to show that he has paid the property tax. In certain cases the tenant has deducted the amount of the tax from the rent without paying the tax, and the landlord has thus lost that part of the rent and had to pay the tax. In the case of a leasehold the loss fell on a man who had sub-let to a sub-tenant. The matter was dealt with two years ago but, unfortunately, not completely, and the ingenuity of certain people has found a way round the safeguards. All I ask in this new Clause is that the tenant who claims the right to deduct the amount of the tax from his rent should be required to produce the receipt for the tax. I believe the words of the Clause are apt for the purpose, and I believe the Chancellor is acquainted with the facts of the case. This is a matter of common justice, and I hope the new Clause will be accepted.
    Mr. PETHICK-LAWRENCE: Our view is that this Amendment is not really necessary. The major cases, where the tenant pays tax in the first instance and

    171
    passes on that payment to the landlord, are already met. So far as we appreciate the point which the hon. and gallant Member has in mind we feel that there is no necessity to make a change. We do not think he has made out a case for the change.
    Major HILLS: All I ask is that a flaw which has been discovered in the present procedure should be put right. The courts have decided that a tenant can claim to make the deduction from the rent without having paid the tax, so that the unfortunate landlord has to go short in his rent and pay the tax as well. That being so, surely a Clause like this ought not to be allowed to continue. All I ask is what is the effect of the Clause.
    Mr. P. SNOWDEN: This ought to be a matter between the landlord and the tenant. I confess that I cannot call to

    NEW CLAUSE.—(Increased Preference on Sugar.)
    Section eight of the Finance Act, 1925, shall have effect as if the following table of preferential reductions of customs duties in case of sugar, molasses, glucose, and saccharin were substituted for Part I. of the Third Schedule to first Act:—

    Article.

    Amount of Preferential Reduction.

    s.

    d

    Sugar which, when tested by the polariscope, indicates a polarisation exceeding 99 degrees

    …

    …

    …

    …

    …

    …

    …

    …

    the cwt.

    7

    1·91

    Sugar of a polarisation exceeding 98 but not exceeding 99 degrees

    …

    the cwt.

    *5

    3·8

    Sugar of a polarisation not exceeding 76 degrees

    …

    …

    …

    the cwt.

    2

    7·34

    Sugar of a polarisation—

    exceeding 76 and not exceeding 77

    …

    …

    …

    …

    …

    the cwt.

    2

    8·32

    exceeding 77 and not exceeding 78

    …

    …

    …

    …

    …

    the cwt.

    2

    9·35

    exceeding 78 and not exceeding 79

    …

    …

    …

    …

    …

    the cwt.

    2

    10·373

    exceeding 79 and not exceeding 80

    …

    …

    …

    …

    …

    the cwt.

    2

    11·48

    exceeding 80 and not exceeding 81

    …

    …

    …

    …

    …

    the cwt.

    3

    0·51

    exceeding 81 and not exceeding 82

    …

    …

    …

    …

    …

    the cwt.

    3

    1·532

    exceeding 82 and not exceeding 83

    …

    …

    …

    …

    …

    the cwt.

    3

    2·56

    exceeding 83 and not exceeding 84

    …

    …

    …

    …

    …

    the cwt.

    3

    3·71

    exceeding 84 and not exceeding 85

    …

    …

    …

    …

    …

    the cwt.

    3

    4·94

    exceeding 85 and not exceeding 86

    …

    …

    …

    …

    …

    the cwt.

    3

    6·087

    exceeding 86 and not exceeding 87

    …

    …

    …

    …

    …

    the cwt.

    3

    7·237

    exceeding 87 and not exceeding 88

    …

    …

    …

    …

    …

    the cwt.

    3

    8·522

    exceeding 88 and not exceeding 89

    …

    …

    …

    …

    …

    the cwt.

    3

    9·882

    exceeding 89 and not exceeding 90

    …

    …

    …

    …

    …

    the cwt.

    3

    11·423

    exceeding 90 and not exceeding 91

    …

    …

    …

    …

    …

    the cwt.

    4

    0·964

    exceeding 91 and not exceeding 92

    …

    …

    …

    …

    …

    the cwt.

    4

    2·58

    exceeding 92 and not exceeding 93

    …

    …

    …

    …

    …

    the cwt.

    4

    4·123

    exceeding 93 and not exceeding 94

    …

    …

    …

    …

    …

    the cwt.

    4

    5·641

    exceeding 94 and not exceeding 95

    …

    …

    …

    …

    …

    the cwt.

    4

    7·26

    exceeding 95 and not exceeding 96

    …

    …

    …

    …

    …

    the cwt.

    4

    8·8

    exceeding 96 and not exceeding 97

    …

    …

    …

    …

    …

    the cwt.

    4

    10·341

    exceeding 97 and not exceeding 98

    …

    …

    …

    …

    …

    the cwt.

    4

    11·96

    mind the particular case which the right hon. and gallant Member for Ripon (Major Hills) has assumed. Perhaps the right hon. and gallant Gentleman will be satisfied with my assurance that I will have the matter looked into, and, if it is a point that we can meet by administration, we will try to meet it.
    Major HILLS: I am afraid it is not the case that the landlord can protect himself, but I certainly accept the offer which the Chancellor of the Exchequer has made, and I will endeavour to persuade him that I am right.
    Lieut.-Colonel SPENDER-CLAY: I am satisfied with the pledge that the Chancellor of the Exchequer will look into this matter.
    Major HILLS: I beg to ask leave to withdraw my Motion.
    Motion and Clause, by leave, withdrawn.

    Article.

    Amount of Preferential Reduction.

    s.

    d.

    Molasses (except when cleared for use by a licensed distiller in the manufacture of spirits) and invert sugar and all other sugar and extracts from sugar which cannot be completely tested by the polariscope and on which duty is not specially charged by reference to the other provisions of this Part of this Schedule:—

    If containing 70 per cent. or more of sweetening matter

    …

    …

    the cwt.

    5

    3·89

    If containing less than 70 per cent. and more than 50 per cent. of sweetening matter

    …

    …

    …

    …

    …

    …

    …

    the cwt.

    3

    3·28

    If containing not more than 50 per cent. of sweetening matter

    …

    the cwt.

    1

    7·03

    The amount of sweetening matter to be taken to be the total amount of cane, invert, and other sugar contained in the article, as determined by analysis in manner directed by the Commissioners.

    Glucose—

    Solid

    …

    …

    …

    …

    …

    …

    …

    …

    …

    the cwt.

    5

    3·89

    Liquid

    …

    …

    …

    …

    …

    …

    …

    …

    …

    the cwt.

    3

    3·28

    Saccharin (including substances of a like nature or use)

    …

    …

    the oz.

    2

    3·62

    *Effective preference.

    .—[Sir A. Pownall]

    Brought up, and read the First time.
    Sir ASSHETON POWNALL: I beg to move, "That the Clause he read a Second time."
    The object of this Amendment is to increase the measure of preference already given to sugar coming from the British Empire. I shall not go at any length into the question of the Sugar Duties beyond saying that a preference was first given 11 years ago, which amounted to one-sixth of the duty. The Sugar Duties have been altered several times in the meantime, and at the moment the preference amounts to one halfpenny in the lb. The Committee will be aware of the Commission which was sent out last autumn with Lord Olivier as chairman, and no doubt hon. Members have read with great anxiety the report of the visit of that Commission to the West Indies. There are countries which produce sugar which have a large consumption of their own, and they are in a position to take strong action to keep their markets for the sugar grown in their own country. Australia is a case in point where there is a great increase in sugar, and they consume in a large measure the sugar which is grown in Queensland.
    The West Indies are in a most unfortunate position with regard to this question. They have obviously no large sugar-consuming population. Fortunately,
    174
    they have Canada not very far away, and Canada has done her best to help the West Indian islands in the very grave financial difficulties through which they have been passing. At the same time, anyone who reads the report will see the grave difficulties that confront the West Indies, and we must, if we possibly can, bridge over those difficulties in some way, in order to carry the islands through this world-wide over-production in the sugar industry. Anyone who is interested in Cuba will realise the difficulties which are now being suffered by the sugar producers there, as is shown by the troubles of the principal railway company in Cuba. The trouble is worldwide, and I think it is up to this Empire to do what can possibly be done to help these relatively small Colonies in the West Indies, which, through no fault of their own, are on the verge of ruin owing to the over-production of sugar.
    That is the reason why we have put down this Clause. It means, in round figures, that the preference, which is approximately ½d. per lb. at the present time, will be extended to, in round figures, ¾d. per lb. on sugar grown within the Empire. This will represent in the meantime a considerable loss to the British Treasury, but it is a loss which, in the circumstances, the Treasury, taking a broad view of its duties towards the Dominions and the Empire, has to confront. The right hon.

    175
    Gentleman will no doubt tell us the amount that the concession will involve. It is a very appreciable sum, but this is one of those matters in which we in the Mother Country ought to do what we can. These particular Colonies are among the oldest under the British Flag, and anyone who reads Lord Olivier's Report will come to the conclusion that something will have to be done for them. We think that this is the best means of helping the islands.
    Major GEORGE DAVIES: To my sorrow, I know the truth of the remarks which have just been made by my hon. and gallant Friend. I know the parlous condition of world prices in the case of sugar, and the tremendous over-production, to which my hon. and gallant Friend has alluded, of that commodity. Sugar is not, unfortunately, the only commodity of general public consumption which is in a state of over-production, and the Chancellor of the Exchequer might very easily ask—and, from an economic point of view, I do not know that it would be possible to criticise the question—why we in this country should take steps to encourage continued overproduction of a commodity which is flooding the world to-day. I think, however, that the question is a great deal deeper than that, and that there is an Imperial and national responsibility in this connection; and I want to press that point of view upon the Committee.
    The Mover of the Clause has stated that there is a very peculiar condition attaching to the West Indies in this matter, a condition which, generally speaking, affects sugar and many other tropical products. That is that the problem of competition in the markets of the world and in the development of the industry has become a very extensive and at the same time a very intensive problem. As in the case of many other tropical problems, it is impossible to deal with it on a small scale. The sugar industry, in common with many other tropical industries, has long ago been rationalised in most countries. It has been found that it must be concentrated, that it cannot, for example, be run by the small farmer. The overhead costs of up-to-date production, cultivation and harvesting are such that the small
    176
    farmer cannot possibly compete, and the result has been that many countries of the world, which have found their geographical, climatic and soil conditions suitable for this crop, have at the same time found that, in order to develop in world competition, they have been compelled to go into the industry intensively and extensively, with the result that the output of any particular sugar country is enormously greater than any potential consumption by its own population.
    There are, of course, exceptions. Queensland has been quoted as one, and the reason for that is clear. In that great sub-continent, covering a variety of climatic and soil conditions, there is only one part that is suitable for sugar culture. The Australian Government in their wisdom have given that culture their encouragement, and the production, even on the scale to which I have alluded, is not too great for the present consumption, let alone what the future may have in store, of the products of that culture. The same thing applies to the mainland of the United States, where they have sugar cane culture, limited for area and for climate. But when you reach a country like the West Indies, where the production is far beyond the needs of the population, you come up against a state of affairs in which the production must be on a big rationalised scale. That is one of the reasons for sugar, like other commodities, suffering from the world over-production. These are admitted facts and figures which anyone who is acquainted with the sugar industry is aware of.
    That does not alter the fact that we cannot go in this question on the ordinary theoretical economic lines which hon. Members below the Gangway would have us follow. There is a wider issue concerned in this matter. There is Imperial responsibility, and it is not merely a question of an industry which will make profits for capitalists who ought to be wiped off the face of the earth. It is the one industry that keeps the population alive. It is the one leg on which it all stands, whether you are speaking of education, social services, shipping or Imperial production. It is admittedly unsound. I have been through those parts of the world. The whole industry of the Hawaiian Islands stood on sugar alone, but we were able to discover a secondary industry, which has now nearly

    177
    become a primary industry, in the way of pineapples. But the West Indies have merely this leg to stand on. We have made ourselves responsible for the population there. Whether we wish it or not, our forebears, the white men who went there and developed the industry, and the coloured men who were imported there have built up a population which is dependent on this industry. Are we to say we take no responsibility for what has been done by our predecessors in office in the House of Commons or for what has happened in those Colonies and, therefore, they may stew in their own juice, and that we have no moral responsibility I do not think there is a Member in the House who could possibly take that attitude. We all give the same answer to the question, "Am I my brother's keeper?" In the West Indies that question come home very closely to every Member of the House.
    This is not simply a question of economic law but of moral responsibility. The facts are at the disposal of everyone. I would not dare to bring forward a plea like this if it had not been for the Commission which was sent with the full authority of the Cabinet to tell us the facts. This is not a thing which is brought forward by a lot of Protectionist Tories. It is a report to the House of Commons by a Commission appointed by the Government of the day, and the same Government is now sitting in office. Are we to ignore those facts? Are we to shut our eyes to them? Here is an opportunity for us actually to put into practice that moral responsibility which I am sure each one of us feels. I speak to some extent against my own personal interest, but I feel so strongly that we have this responsibility that I must lose sight of that side and say, "Here is an opportunity at any rate to starve off that sweep to disaster which is starting there and which is so forcibly brought before us if we choose to read the Olivier Report." I hope, therefore, that when the Chancellor of the Exchequer comes to reply he will express appreciation of the responsibility which in this connection rests upon his shoulders, because he is the one who can help or hinder by permitting this Clause to be part of this Finance Bill. I support this Clause most thoroughly, and trust that it may be added to the Bill.
    Mr. ORMSBY-GORE: I want, very briefly, to plead earnestly to the Chancellor of the Exchequer on this subject to-night. The Government have just issued a White Paper in regard to the Dependencies in East Africa in which they declare to the whole world that the responsibility and the trusteeship for the negro people of these Dependencies cannot be separated from the Imperial Government, and they say that that is their decision irrevocably. In accordance with the report of their own committee presided over by Lord Olivier, it is clear that the negro population of the West Indian islands of Antigua, Trinidad, British Guiana, Barbados, and, I should add, the Indian population of British Guiana and of Mauritius, are at this moment facing a lowering of their standard of living, of their public services, and of their wages which is of the most serious consequence to the Imperial Government who are trustees for their welfare. As those reports show, that lowering of the standard of public services, of local revenue, and of the conditions of those people is brought about by the fact that British Colonial sugar is excluded from all the markets of the world other than Great Britain and Canada. Whereas in regard to the French West Indies, which are interlaced with our sugar islands, France puts a prohibitive duty on all sugar coming from the British Isles, she admits sugar from her own Colonies absolutely free, and she has only this year increased her duties in order to meet the serious situation which has come about by over-production. The United States of America has just been quoted. Sugar from the Empire of the United States overseas, their dependencies of Porto Rico, the Philippines and the like, goes into the United States free, whereas there is an increased duty put on this year against British Colonial sugar.
    Unless the British Government are prepared to do more for the British negro population dependent upon the sugar industry, at any rate, until such time as the sugar prices become more in consonance with the cost of production, we shall not be carrying out our proclaimed trusteeship. Take Trinidad. The position there is that several large central sugar factories have been built up partly by Government assistance, and 40,000

    179
    natives, negro and West Indian small farmers, take their canes to be crushed at those factories. In the island of St. Kitts rationalisation has gone further, and in Antigua and St. Kitts there is one central factory. That is the only place where the crop can go from all these small proprietors, who are the descendants of the slaves who were dragged unwillingly to Africa, and settled in these islands. Ruin threatens the industry owing to the action of foreign Governments.
    What is the cheapest way in which the Chancellor of the Exchequer can fulfil his responsibilities and the responsibilities of the Imperial Government for these negro people? I hold that the cheapest way that he can do it is by this Amendment. This Amendment indicates the recommendation of the Olivier Commission, namely, to increase the rate of preference given by Great Britain to the West Indies and Mauritius to the rate of preference which is given by Canada. It was recommended that it should be increased by, I think, 10½d., but this Amendment suggests a round increase of 1s. per cwt. That is only a comparative price; it is an increase of Preference. I understand that this Amendment would cost round about £700,000. I do not believe that if the Chancellor of the Exchequer rejects the Amendment he can possibly get out of his responsibility—if he allows the industry to be extinguished and he has to provide a dole or relief work for the cane growers and the negroes of the West Indies—for less than £1,000,000 a year, for a very considerable number of years. If the canes go out of cultivation and the negroes are left just to grow their local foodstuffs, and if they are to have any life at all and any public services, then it is going to cost far more in grants-in-aid than the Amendment would cost. I take the view that we have an absolute and definite trustee responsibility to the coloured people of the sugar growing areas and that the cheapest way and the most effective way of dealing with the situation presented to us this year is by the adoption of the Amendment. I plead with the Chancellor of the Exchequer to adopt this method rather than to leave it to future grants-in-aid, to future doles from the British taxpayer, which is the only possible alternative
    180
    which will face him within a year, simply to keep these unfortunate people alive.
    Mr. TINNE: As one of those who is, in a small way, responsible for giving the people of this country their daily ration of sugar, as well as for the employment of a good many thousands of East Indian and other labourers, let me place before the Committee the result of the possible turning down of this Amendment. The memories of this House and the memories of the country are rather short. I would ask the Committee to carry their minds back to August, 1914, when, owing to the fact that there was no Imperial supply of sugar available sufficient for this country, the Government had to expropriate the crops of the West Indian planters and fix a price. At that time they expropriated my crop at £16 a ton, when I could have obtained £19 a ton in New York. I had no grouse about that. One's natural patriotism was quite ready to stand that, but when one hears things said about one not putting by money for machinery and the rest of it, and when one remembers what happened, it does rather get on one's nerves. We had undoubtedly to get an Imperial supply under our own control. In the later years of the War the Chancellor of the Exchequer may remember something about rationing. A good many children who were brought up at that time were greatly the worse for the fact that they could not get sufficient sugar for their rations, and that fact is coming out at the present day in the reports of schoolmasters with respect to the children.
    Look for a moment at the crops of the world and see what sugar is available under Imperial control in order to meet the demands of this country. It is unfortunate that one must go into figures on this occasion, but I can give the estimate of Willett and Gray as to the world production. The world's crop for 1929–30 was estimated at 26,786,500 tons, of which the United Kingdom produced 350,000 tons of domestic beet. I have no quarrel with that, but if the Chancellor of the Exchequer wants to describe anything as uneconomic he can describe British domestic beet as uneconomic in comparison with the sugar industry in the West Indies. It costs three times as much to produce a ton of domestic beet as it does to produce a

    181
    ton of West Indian cane. Without the subsidy I will undertake to beat the British beet industry every time. Canada produced 32,000 tons; Fiji cane, 98,000 tons; Queensland, 516,000 tons; Africa, mainly Natal and Mauritius, 699,000 tons, and British West Indies and British Guiana 351,000 tons. That is about 2,046,000 tons under British control in the Colonies. In addition there is British India, which produces 2,650,000 tons, but in the case of British India it consumes pretty well all its own sugar as well as importing from Java and Mauritius. That leaves available for the British market British Colonial sugar of 2,046,000 tons, less than what is consumed elsewhere.
    Let us see where it goes to. Canada takes a substantial amount of British West Indies sugar and some Mauritius sugar; the exact figure is 58 per cent. of British West Indies sugar. A percentage of the Fiji crop goes to the east coast of Canada and the remainder to New Zealand. Queensland and Natal send us 15 per cent. of our imports; and in connection with that let me add that in Queensland and Natal the industries are highly protected. In the case of Queensland the cost of production is £23, and the internal price £27 per ton. The balance is dumped on this market. That is the kind of thing with which the British West Indies have to contend. We can produce it at about half that amount. If we are snuffed out I ask whether we can get Queensland sugar sent to this country at the price at which we are getting it now? The present production of 350,000 tons of domestic beet in this country does not provide for more than about one-sixth or one-seventh of the consumption; the balance has to be imported, and the question is where are we going to import it from? Java and Cuba are, of course, the two biggest producers, but Java and Cuba are in foreign hands.
    Does the Committee seriously suppose that if the West Indies are snuffed out that the Cubans and the Javanese, the Dutchmen and Americans, will continue to give us sugar as though they were philanthropists? Not they. Once they have this country in their power they will squeeze us well, and if I go under in this matter I shall look on with a certain enjoyment at the process. Lastly, in considering the state of the West Indies, let
    182
    me refer to the question of labour. In Queensland, among other peculiarities, they are employing 7,000 Italian labourers on the estate. In the West Indies our labour is either black, negro or coolie. We have a few Chinese left and a few Madeirian Portuguese, but the bulk of these have drifted and taken to other occupations. The bulk of our labour is, therefore, British.
    One more point which may bear with the Chancellor of the Exchequer. It is rather a difficult one to put, and one which one does not want to dwell upon, because one does not like to contemplate such a thing. We in the West Indies are thoroughly loyal. In the islands, probably, loyalty is even greater than in British Guiana where, as the Committee may remember from the Snell-Wilson report, the population is strongly mixed. It has appeared in the Press on more than one occasion that British Guiana at all events would not be averse to going under the United States Flag. That is not an authoritative pronouncement because many of us would very strongly resent the idea of any such thing. But it has to be faced. If on account of these estates going out of cultivation there is distress, there are riots, there is disorder and there is a cry that we ought to go to the States, then we know whose fault it will be.
    We have a claim for damages against the Chancellor of the Exchequer. Earlier in the year, when we were told that we would lose this Sugar Duty, for over six months the sugar market was completely demoralised. Buyers in this country insisted on placing clauses in the contracts that all sugar, whether melted or not, should be at the risk of the seller, and that the buyers should be liable for any rise or fall in the duty. How could we compete with a thing of that sort? For six months the market was completely disorganised. No one could sell sugar and nothing could be done, and the amount of money lost over that was—one does not like to put it into figures, but it was a very large amount, and to that extent one thinks that the Chancellor of the Exchequer should at least try to do something for us. One feels pretty strongly on this matter, and that is only natural when one contemplates what is going on out there now. Only last week I know of one cable

    183
    sent out to the Colony ordering the abandoning of an estate which has been in cultivation for the past 120 years. At the moment that estate is employing something like 3,000 labourers. To use a British Guianan expression they will be "on the dam" within the next month or so.
    What is going to happen when it has all gone? Some few may find re-employment in the rice industry, but that will not take the place of sugar. Some others may emigrate and some go into the bush for the forestry industry and so on; but they will not be absorbed by the existing industries of the Colony. It is impossible that they could be. Sugar employs more than any other industries that we have in the place, and if the Chancellor of the Exchequer is obdurate about this there is no doubt that within the next year or 18 months he will have to face the giving of a dole which will equal several times the amount which this duty will cost him.
    Mr. P. SNOWDEN: There can be no difference in any part of the Committee in deploring and sympathising with the condition of those who are engaged in the sugar industry in every part of the world. The increase in world production of sugar, resulting in the abnormal fall in prices, has, for the time being, reduced these sugar-producing countries to a most deplorable state. Neither do I wish to deny for a moment that we have a responsibility in this matter. Therefore, it comes to the question, in what way, and how far within our means, we can meet this obligation, and give assistance to these people. In the course of his speech, the hon. Member who moved this new Clause said the efficiency of the industry in the West Indies was beyond all question. I do not want to be controversial in this, because I am quite sure it is the desire of all parties to do what is possible to ameliorate the conditions in the industry, but this much must be said, and it was admitted by a later speaker, the hon. and gallant Member for Yeovil (Major Davies) that there are, at any rate, areas in the West Indies where the efficiency of the industry leaves a great deal to be desired.
    Reference was made also to the fact that there are whole islands there where work is given up entirely to the sugar
    184
    industry. This is, of course, unfortunate and it is not a state of things which can be remedied at once, but I think the experience of these recurring crises should show the desirability of trying to have other industries, because it generally happens, when one industry is very depressed, that if there are a number of other industries, some of them are in a fair condition of prosperity. However, that is the situation which, however unfortunate it may be, has been allowed to grow up, and no action at present can alter it. This Clause proposes an increase in the preference of one shilling per cwt. I was asked by the mover of the Clause what the cost would be. He did not commit himself to any figure, but he said twice that the sum would be very considerable. The right hon. Member for Stafford (Mr. Ormsby-Gore) said he thought it would not cost more than about £700,000 a year. I regret to have to say that figure is a woeful underestimate of the cost. The cost would be more than double that figure—at least £1,500,000 a year—and that is excluding what would certainly happen, namely, the extension of the increased preference to British-made beet sugar.
    Suppose we gave this increased preference of one shilling. Is that going to enable the sugar producer in the West Indies to survive if world prices remain at anything like what they are at present? I know that there are opposite me, as, for instance, the hon. Member who has just spoken, those who have a most intimate knowledge of the industry, but the figures that I have as to the average cost of production in the West Indies at the present world prices, and the selling price in this country, seem to point to the conclusion that this increase of one shilling would do nothing whatever to put the West Indian industry in a better position in this country. These figures are probably not exact, but I think they are roughly correct. The cost of production at the present time is about 13s. per cwt., or £13 per ton. [HON. MEMBERS: "Too high!"] Well, say £12 10s. f.o.b. I said about £13. The world price is about 6s. 6d. per cwt., or £6 10s. per ton c.i.f. How can a preference of 1s. a cwt., or £1 a ton, make up the difference between £13 a ton and £6 10s. per ton, even with the present preference

    185
    of £3 15s. a ton added? I wish to correct a statement which I made just now in regard to beet sugar produced in this country. The figure of £1,500,000 includes that. There is a matter which, I think, I am justified in mentioning, because it was referred to in the newspapers. The right hon. Gentleman the Member for Sparkbrook (Mr. Amery), a little time before the Budget was introduced, headed a deputation representing sugar interests in every part of the Empire, and the request which they made to me was that the existing preference should be maintained. Surprised at the moderation which they displayed, I pressed them as to whether that was all they wanted, and they replied that it was.
    Mr. AMERY: That was all that I was pressing for at that meeting, but I made it perfectly clear that we did not regard that as all that was desirable in the interests of the industry.
    Mr. SNOWDEN: What I said was that that was all they wanted from me. That was the only claim they put before me. For the reasons which I have given—because of its cost and its ineffectiveness for doing anything material to help the Colonial industries in their present plight—I regret that I am unable to accept this proposal. We are asked what we are doing. Well, we took steps some time ago in order to enable next year's crop to be handled. We made arrangements for credits for that purpose. Now the Dominions Office is in communication with the Governors of the various Colonies asking for information as to what is likely to be needed in the way of help, if distress upon any large scale should arise, and, if it should be necessary for the Government to give assistance in such a condition of things, then we are prepared to do it. I do not know that I can say more than that. If I thought that this proposal would be effective and if I could provide the money, I should be very glad to do it, because I do want to assure every section of the Committee that we realise the seriousness of the position, we accept our responsibility, and we are prepared to do what we can within reason and within our resources.
    Mr. AMERY: I regret that we have heard a reply from the Chancellor of the Exchequer which I can only describe
    186
    as, in every respect, profoundly unsatisfactory. The right hon. Gentleman talks about his realisation of the seriousness of the position and his acceptance of responsibility, but he has not given us the slightest indication that any steps are being taken to fulfil that responsibility. He suggested two. One was the scheme to share some fraction of the loss which the banks would incur if they advanced sums of money to a sinking industry. As the banks are not going to be foolish enough to advance that money in order to incur the greater part of the loss, there is not the slightest prospect of that particular form of assistance ever being called for, and every one of the sugar Colonies has rejected it as utterly worthless. The second step is to make inquiries now as to what possible doles may be wanted later on when the policy of inertness on the part of His Majesty's Government has reduced these Colonies to a state of pauperisation. Our whole case is that it is cheaper in the interests of this country, to fulfil our responsibility by a slight advance on what has been the policy of this country for 10 years in building up the Empire sugar industry, than to include the black population of the West Indies among the millions of our dole population.
    11.0 p.m.
    The right hon. Gentleman spoke about the cost. He said that, including beet sugar, the immediate cost of this concession would be at least £1,500,000. This concession for which we are asking is a concession of 1s. a cwt., or £1 a ton. Last year the total import of Empire sugar into this country was 710,000 tons, and the prospects of the present year are somewhat lower, so that at any rate, apart from beet sugar and apart from ultimate developments which may no doubt occur in future years from the expansion of Empire sugar, £700,000, the figure which my right hon. Friend gave, was a perfectly fair estimate of the immediate cost of that concession. If you included British beet sugar, you would have to allow for an extra £350,000 in the coming year, but I would suggest that it is at any rate open to consideration whether British beet sugar, which already enjoys a measure of subsidy far larger than Empire sugar, should necessarily be given this in addition to the

    187
    bounty which it is already getting. If that bounty is insufficient for the purpose of maintaining the beet sugar industry, there would be a case on its own merits for giving them a larger bounty or giving this preference without setting it off against the bounty, but if the British beet sugar industry is in a position to extend its cultivaton and pay its way without the preference in addition to the bounty, it seems to me there is no absolute necessity for the two together; and in that case the total cost would be, at any rate in the first instance, not more than £700,000.
    But even if the cost were greater, I put it to the Committee that it is, from every point of view, far better to keep people at their work, to preserve the large amount of capital which has been invested in this industry instead of having it scrapped, far better to keep people in their normal occupation than to keep them on the dole indefinitely. The right hon. Gentleman talked of alternative industries. You might as well tell this country in its present plight that it had better drop manufacturing and take to growing fruit. There is not the opportunity in those countries to adopt alternatives. Take Trinidad, where there is the alternative of cocoa. Cocoa is as depressed as sugar. It is no good asking people to do something else in an emergency. Help them to do what they can do. At any rate, we have the testimoney of Lord Olivier in regard to the West Indies, and the testimony of Sir Francis Watts with regard to Mauritius, that on the whole those industries are carried on efficiently and could more than hold their own in the world under Free Trade conditions. What we suggest is that with our responsibility for these colonies, if we cannot secure them free trade conditions, let us at any rate secure them fair trade conditions in this market.
    The right hon. Gentleman suggested that the preference for which we ask is wholly inadequate to be of the slightest use. There, again, as in a previous instance, he entirely misrepresents our moderation. We deliberately ask for only the minimum which we hope can carry these industries through, and we have based our figure upon the reports of the two Commissions which the Government sent out.
    188
    Sir Francis Watts was sent out to Mauritius. He pointed out that the island was heading towards absolute disaster, and his recommendation was a grant-in-aid of one shilling per cwt., which he believed would just enable them to tide over the present situation. That was also, in substance, Lord Olivier's recommendation. On page 22 of his report he recommends, not one shilling, but 10½d. to bring up our duty to the Canadian level. If the right hon. Gentleman makes any point between 10½d. and one shilling, we will accept the 10½d. Lord Olivier says:
    "This rate of preference is not sufficient under present market conditions to cover entirely the average bare cost of manufacture, but it is reasonable to expect that the average price throughout the year may improve following a pronouncement by the imperial Government of a policy and maintaining the Colonial sugar industry. Also the fact of sympathetic treatment being accorded or guaranteed to the industry will encourage those who are in a position to improve their equipment to proceed with these improvements, and to make it possible for others to find the money for similar purposes, thereby reducing the cost of production."
    A policy of practical sympathy is what Lord Olivier recommends; that is what we are advocating; and that is what the right hon. Gentleman rejects as being utterly worthless. Let him ask any of the Colonial Governments if they would sooner have our proposed new Clause or his ludicrous suggestion for repaying the banks a fraction of their losses, I believe they would be willing even to carry on their industry at a slight loss if they once realise that we are wishful to carry them through. What we are asking is only the practical continuance of a policy which in the last 10 years has built up here at home and in every part of the Empire a great and important industry. In 1919 we were drawing only 8 per cent. of our sugar supplies from the Empire. Last year we drew 34½ per cent. from the Empire overseas, and with the home supplies, sufficient to bring our Empire production to over 40 per cent. of our consumption. All that meant tremendous development of the industry and investment of capital on production, and the building up of technical skill.
    All these things are a real increment to the capital value of this country and the Empire. Now, simply because of a

    189
    rather more aggressive policy on the part of foreign countries, that industry in certain parts of the Empire has been put in a position of exceptional difficulty, and when we are faced with the alternative of either making good our policy or of the work of the last few years going to rapid ruin, the Chancellor of the Exchequer absolutely refuses to face the situation. It is not only the alternative between what this new Clause would cost and what he would have to pay in doles. There is another item in the ledger, and that is the trade we have at stake. We have in the last few years built up with the sugar growing parts of the Empire a trade worth £7,000,000 or £8,000,000 a year and representing several millions' worth of work and wages in this country. From the Clyde alone we send £2,000,000 worth of sugar machinery abroad every year, and at least a third of that goes to the Empire, and the loss of that third would in the opinion of the manufacturers seriously imperil their capacity to provide for their other markets. Surely those items are worth considering.
    One of the most serious blows our trade has had in the last few months is the restriction of the Australian market, due to the fact that Australia is not able to send us her raw materials to an equivalent value of the manufactures we send her, and this Clause furnishes the possibility of a very substantial increase in the Australian sugar supply to this country, which is already worth £2,000,000 or £3,000,000 a year and might easily, as a matter of exchange, apart from all other considerations, facilitate our export of manufactures to Australia to the tune of £2,000,000 or £3,000,000 a year. On all these grounds we are appealing to the Chancellor to follow up a policy which has al ready contributed so much to the welfare of this country and the Empire and give some practical justification to his talk about sympathy and a realisation of responsibility, which at present means nothing.
    After all, the cost of remitting that 1s. of the Sugar Duty is very little more to the Exchequer than the cost of remitting those Safeguarding Duties which run out in the present year. The Chancellor of the Exchequer may have theoretical objections to these duties, but that is not the point we are discussing at this moment. Can anybody suggest that their
    190
    maintenance could inflict as much harm upon any section of His Majesty's subjects as the refusal to accept this Clause is going to inflict on His Majesty's subjects in the West Indies? I put it again to hon. Members opposite: Is it really a part of their policy that ancient and loyal British Colonies should go under and be put upon the dole rather than that they should accept a policy which might add some small fraction to the price of sugar or involve those very minor remissions for which we are asking? I am profoundly disappointed with the attitude of the Chancellor of the Exchequer and I hope we shall have the support of some, at any rate, of the hon. Members below the Gangway in pressing this Clause.
    Brigadier-General Sir HENRY CROFT: We have heard from a representative of His Majesty's Government during a debate in another place that if this industry collapses we shall have a large proportion of the population, in some places almost the whole of the population, on the hands of the Government in a state of destitution. Has the right hon. Gentleman calculated the number of persons engaged in the industry and that if they are destitute and he is to do anything at all to keep life in them, it will cost him more than the £700,000 or £1,000,000 which has been referred to this evening? Speaking as a planter, though not interested in this industry, I say that if these plantations are to be "grubber" it will break the hearts of the men who have developed those plantations. It will mean that they cannot carry their overhead charges, that they must go into liquidation and that the natives, for whom we have a trust are going to be destitute and to be dealt with on the dole. With all our tragic experience no party is innocent. We have had our difficulties since the War. We all realise that we have made mistakes, but are we going to allow the great plantation industries of our Colonies deliberately to fall into the same position as we have allowed the depressed industries of Lancashire, Yorkshire and the North-East Coast? That is the real point. I hope that we shall lift this question above a party issue, and say to ourselves—not what is good policy and whether these old political cries are vital—let us consider

    191
    the interests of those Colonies, which are our best customers in the British Empire, and ask, are we wise to inflict this grave injury upon those good customers because we have not the vision and the boldness to make a stand and give them life this evening?
    I urge the right hon. Gentleman this evening to consider whether this is not one more nail in the coffin of British industry,
    and whether it is the right way to approach the coming Imperial Conference by saying that we are not going to lift almost a finger to help these Colonies at the present moment. I beg the Committee to remember these facts when we come to vote on this new Clause.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 141; Noes, 246.

    Division No. 417.]

    AYES.

    [11.16 p.m.

    Acland-Troyte, Lieut.-Colonel

    Ferguson, Sir John

    Morrison, W. S. (Glos., Cirencester)

    Ainsworth, Lieut.-Col. Charles

    Fielden, E. B.

    Morrison-Bell, Sir Arthur Clive

    Albery, Irving James

    Forestier, Walker, Sir L.

    Muirhead, A. J.

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

    Fremantle, Lieut.-Colonel Francis E.

    Nicholson, O. (Westminster)

    Atholl, Duchess of

    Gibson, C. G. (Pudsey & Otley)

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

    Atkinson, C.

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

    Nield, Rt. Hon. Sir Herbert

    Baillie-Hamilton, Hon. Charles W.

    Glyn, Major R. G. C.

    Ormsby-Gore, Rt. Hon. William

    Balfour, George (Hampstead)

    Gower, Sir Robert

    Penny, Sir George

    Balfour, Captain H. H. (I. of Thanet)

    Graham, Fergus (Cumberland, N.)

    Peto, Sir Basil E. (Devon, Barnstaple)

    Beamish, Rear-Admiral T. P. H.

    Greene, W. P. Crawford

    Pownall, Sir Assheton

    Beaumont, M. W.

    Grenfell, Edward C. (City of London)

    Ramsbotham, H.

    Birchall, Major Sir John Dearman

    Gretton, Colonel Rt. Hon. John

    Rentoul, Sir Gervais S.

    Bird, Ernest Roy

    Gunston, Captain D. W.

    Reynolds, Col. Sir James

    Boothby, R. J. G.

    Hacking, Rt. Hon. Douglas H.

    Roberts, Sir Samuel (Ecclesall)

    Bourne, Captain Robert Croft

    Hamilton, Sir George (Ilford)

    Rodd, Rt. Hon. Sir James Rennell

    Bowyer, Captain Sir George E. W.

    Hanbury, C.

    Russell, Alexander West (Tynemouth)

    Bracken, B.

    Hartington, Marquess of

    Salmon, Major I.

    Braithwaite, Major A. N.

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

    Samuel, A. M. (Surrey, Farnham)

    Briscoe, Richard George

    Haslam, Henry C.

    Samuel, Samuel (W'dsworth, Putney)

    Brown, Col. D. C. (N'th'l'd., Hexham)

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

    Sandeman, Sir N. Stewart

    Buchan, John

    Heneage, Lieut.-Colonel Arthur P.

    Sassoon, Rt. Hon. Sir Philip A. G. D.

    Bullock, Captain Malcolm

    Herbert, Sir Dennis (Hertford)

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

    Butt, Sir Alfred

    Hills, Major Rt. Hon. John Waller

    Smith-Carington, Neville W.

    Carver, Major W. H.

    Horne, Rt. Hon. Sir Robert S.

    Somerset, Thomas

    Cayzer, Sir C. (Chester, City)

    Howard-Bury, Colonel C. K.

    Somerville, A. A. (Windsor)

    Chapman, Sir S.

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

    Somerville, D. G. (Willesden, East)

    Churchill, Rt. Hon. Winston Spencer

    Hurd, Percy A.

    Southby, Commander A. R. J.

    Cockerill, Brig.-General Sir George

    Kindersley, Major G. M.

    Stanley, Lord (Fylde)

    Colfox, Major William Philip

    King, Commodore Rt. Hon. Henry D.

    Steel-Maitland, Rt. Hon. Sir Arthur

    Colman, N. C. D.

    Leighton, Major B. E. P.

    Sueter Rear-Admiral M. F.

    Colville, Major D. J.

    Lewis, Oswald (Colchester)

    Thomas, Major L. B. (King's Norton)

    Courtauld, Major J. S.

    Llewellin, Major J. J.

    Thomson, Sir F.

    Cranbourne, Viscount

    Lymington, Viscount

    Tinne, J. A.

    Crichton-Stuart, Lord C.

    McConnell, Sir Joseph

    Titchfield, Major the Marquess of

    Croft, Brigadier-General Sir H.

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

    Turton, Robert Hugh

    Crookshank, Capt. H. C.

    MacRobert, Rt. Hon. Alexander M.

    Vaughan-Morgan, Sir Kenyon

    Culverwell, C. T. (Bristol, West)

    Maitland, A. (Kent, Faversham)

    Ward, Lieut.-Col. Sir A. Lambert

    Cunliffe-Lister, Rt. Hon. Sir Philip

    Margesson, Captain H. D.

    Wardlaw-Milne, J. S.

    Dalrymple-White, Lt.-Col. Sir Godfrey

    Marjoribanks, E. C.

    Warrender, Sir Victor

    Davidson, Rt. Hon. J. (Hertford)

    Mason, Colonel Glyn K.

    Wells, Sydney R.

    Davies, Dr. Vernon

    Mitchell-Thomson, Rt. Hon. Sir W.

    Williams, Charles (Devon, Torquay)

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

    Meller, R. J.

    Windsor-Clive, Lieut.-Colonel George

    Dawson, Sir Philip

    Merriman, Sir F. Boyd

    Wolmer, Rt. Hon. Viscount

    Dixon, Captain Rt. Hon. Herbert

    Mond, Hon. Henry

    Womersley, W. J.

    Duckworth, G. A. V.

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

    Worthington-Evans, Rt. Hon. Sir L.

    Edmondson, Major A. J.

    Moore, Sir Newton J. (Richmond)

    England, Colonel A.

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

    TELLERS FOR THE AYES.—

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

    Morden, Col. W. Grant

    Major Sir George Hennessy and

    Captain Wallace.

    NOES.

    Adamson, Rt. Hon. W. (Fife, West)

    Benson, G.

    Buchanan, G.

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

    Bentham, Dr. Ethel

    Burgess, F. G.

    Addison, Rt. Hon. Dr. Christopher

    Bevan, Aneurin (Ebbw Vale)

    Burgin, Dr. E. L.

    Amman, Charles George

    Blindell, James

    Caine, Derwent Hall-

    Arnott, John

    Bowen, J. W.

    Cameron, A. G.

    Aske, Sir Robert

    Broad, Francis Alfred

    Cape, Thomas

    Attlee, Clement Richard

    Brockway, A. Fenner

    Carter, W. (St. Pancras, S. W.)

    Baldwin, Oliver (Dudley)

    Brooke, W.

    Charleton, H. C.

    Barnes, Alfred John

    Brothers, M.

    Chater, Daniel

    Barr, James

    Brown, C. W. E. (Notts, Mansfield)

    Church, Major A. G.

    Batey, Joseph

    Brown, Ernest (Leith)

    Clarke, J. S.

    Bellamy, Albert

    Brown, Rt. Hon. J. (South Ayrshire)

    Cluse, W. S.

    Bennett, Capt. Sir E. N. (Cardiff C.)

    Brown, W. J. (Wolverhampton, West)

    Cocks, Frederick Seymour

    Compton, Joseph

    Kirkwood, D.

    Riley, Ben (Dewsbury)

    Daggar, George

    Lang, Gordon

    Riley, F. F. (Stockton-on-Tees)

    Dalton, Hugh

    Lansbury, Rt. Hon. George

    Ritson, J.

    Davies, E. C. (Montgomery)

    Lathan, G.

    Romeril, H. G.

    Davies, Rhys John (Westhoughton)

    Law, Albert (Bolton)

    Rosbotham, D. S. T.

    Denman, Hon. R. D.

    Law, A. (Rosendale)

    Rowson, Guy

    Dickson, T.

    Lawrence, Susan

    Russell, Richard John (Eddisbury)

    Dukes, C.

    Lawrie, Hugh Hartley (Stalybridga)

    Salter, Dr. Alfred

    Duncan, Charles

    Lawson, John James

    Sanders, W. S.

    Ede, James Chuter

    Lawther, W. (Barnard Castle)

    Sandham, E.

    Edge, Sir William

    Leach, W.

    Sawyer, G. F.

    Edmunds, J. E.

    Lee, Frank (Derby, N. E.)

    Scott, James

    Edwards, E. (Morpeth)

    Lee, Jennie (Lanark, Northern)

    Sexton, James

    Egan, W. H.

    Lewis, T. (Southampton)

    Shaw, Rt. Hon. Thomas (Preston)

    Elmley, Viscount

    Lindley, Fred W.

    Shepherd, Arthur Lewis

    Evans, Capt. Ernest (Welsh Univer.)

    Lloyd, C. Ellis

    Sherwood, G. H.

    Foot, Isaac

    Logan, David Gilbert

    Shield, George William

    Forgan, Dr. Robert

    Longbottom, A. W.

    Shiels, Dr. Drummond

    Freeman, Peter

    Longden, F.

    Shillaker, J. F.

    Gardner, B. W. (West Ham, Upton)

    Lunn, William

    Shinwell, E.

    Gardner, J. P. (Hammersmith, N.)

    Macdonald, Gordon (Ince)

    Short, Alfred (Wednesbury)

    George, Megan Lloyd (Anglesea)

    MacDonald, Malcolm (Bassetlaw)

    Simmons, C. J.

    Gibbins, Joseph

    McElwee, A.

    Sinclair, Sir A. (Caithness)

    Gibson, H. M. (Lancs, Mossley)

    McEntee, V. L.

    Sinkinson, George

    Gill, T. H.

    McGovern, J. (Glasgow, Shettleston)

    Sitch, Charles H.

    Gillett, George M.

    McKinlay, A.

    Smith, Ben (Bermondsey, Rotherhithe)

    Glassey, A. E.

    McShane, John James

    Smith, Frank (Nuneaton)

    Gossling, A. G.

    Malone, C. L'Estrange (N'thampton)

    Smith, Rennie (Penistone)

    Gould, F.

    Mander, Geoffrey le M.

    Smith, Tom (Pontefract)

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

    Mansfield, W.

    Smith, W. R. (Norwich)

    Granville, E.

    Marcus, M.

    Snell, Harry

    Gray, Milner

    Marley, J.

    Snowden, Rt. Hon. Philip

    Greenwood, Rt. Hon. A. (Colne)

    Marshall, Fred

    Snowden, Thomas (Accrington)

    Grenfell, D. R. (Glamorgan)

    Mathers, George

    Sorensen, R.

    Griffith, F. Kingsley (Middlesbro' W.)

    Matters, L. W.

    Stamford, Thomas W.

    Griffiths, T. (Monmouth, Pontypool)

    Messer, Fred

    Stephen, Campbell

    Groves, Thomas E.

    Middleton, G.

    Stewart, J. (St. Rollox)

    Grundy, Thomas W.

    Millar, J. D.

    Strachey, E. J. St. Loe

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

    Mills, J. E.

    Strauss, G. R.

    Hall, G. H. (Merthyr Tydvil)

    Milner, Major J.

    Taylor, R. A. (Lincoln)

    Hall, Capt. W. G. (Portsmouth, C.)

    Montague, Frederick

    Thurtle, Ernest

    Hamilton, Mary Agnes (Blackburn)

    Morgan, Dr. H. B.

    Tinker, John Joseph

    Hardie, George D.

    Morley, Ralph

    Townend, A. E.

    Harris, Percy A.

    Morris, Rhys Hopkins

    Turner, B.

    Hartshorn, Rt. Hon. Vernon

    Morris-Jones, Dr. J. H. (Denbigh)

    Vaughan, D. J.

    Hastings, Dr. Somerville

    Morrison, Herbert (Hackney, South)

    Viant, S. P.

    Haycock, A. W.

    Morrison, Robert C. (Tottenham, N.)

    Walkden, A. G.

    Hayes, John Henry

    Mort, D. L.

    Walker, J.

    Henderson, Right Hon. A. (Burnley)

    Moses, J. J. H.

    Wallace, H. W.

    Henderson, Arthur, Junr. (Cardiff, S.)

    Murnin, Hugh

    Watkins, F. C.

    Henderson, Thomas (Glasgow)

    Nathan, Major H. L.

    Watson, W. M. (Dunfermline).

    Henderson, W. W. (Middx., Enfield)

    Naylor, T. E.

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

    Herriotts, J.

    Oldfield, J. R.

    Wellock, Wilfred

    Hirst, G. H. (York W. R. Wentworth)

    Oliver, George Harold (Ilkeston)

    Welsh, James (Paisley)

    Hoffman, P. C.

    Oliver, P. M. (Man., Blackley)

    West, F. R.

    Hollins, A.

    Owen, Major G. (Carnarvon)

    Westwood, Joseph

    Hopkin, Daniel

    Palin, John Henry

    White, H. G.

    Hudson, James H. (Huddersfield)

    Paling, Wilfrid

    Whiteley, Wilfrid (Birm., Ladywood)

    Hunter, Dr. Joseph

    Parkinson, John Allen (Wigan)

    Williams, David (Swansea, East)

    Isaacs, George

    Perry, S. F.

    Williams, Dr. J. H. (Llanelly)

    Jenkins, W. (Glamorgan, Neath)

    Pethick-Lawrence, F. W.

    Williams, T. (York, Don Valley)

    John, William (Rhondda, West)

    Phillips, Dr. Marion

    Wilson, C. H. (Sheffield, Attercliffe)

    Johnston, Thomas

    Picton-Turbervill, Edith

    Wilson, J. (Oldham)

    Jones, Rt. Hon. Leif (Camborne)

    Potts, John S.

    Wilson, R. J. (Jarrow)

    Jones, Morgan (Caerphilly)

    Price, M. P.

    Winterton, G. E. (Leicester, Loughb'gh)

    Jowett, Rt. Hon. F. W.

    Pybus, Percy John

    Wise, E. F.

    Jowitt, Sir W. A. (Preston)

    Ramsay, T. B. Wilson

    Young, R. S. (Islington, North)

    Kelly, W. T.

    Raynes, W. R.

    Kennedy, Thomas

    Richards, R.

    TELLERS FOR THE NOES.—

    Kinley, J.

    Richardson, R. (Houghton-le-Spring)

    Mr. Charles Edwards and Mr.

    William Whiteley.

    NEW CLAUSE.—(Relief from duty on hydro-carbon oils used for manufacture.)
    Section two of the Finance Act, 1928, shall be amended by the addition to subsection (8) after the words "in respect of the oil so used" of the following words:
    or, in the case of a person using hydro-carbon oil as the raw material of his manufacture
    194
    or as an element in the process of manufacture he may make application for relief to the commissioners and if it appears to the satisfaction of the commissioners that the applicant has at any time within the period of twelve months or such lesser period for which his accounts have last been made up used any quantity of hydro-carbon oil, either as a raw material or in the process of manufacture, he shall be entitled to obtain from the

    195
    commissioners repayment of any duty which has been paid in respect of the oil so consumed, so however that no person shall receive repayment both under this sub-section and by way of drawback under sub-section six in respect of the same hydro-carbon oils.—[Mr. Womersley.]
    Brought up, and read the First time.
    Mr. WOMERSLEY: I beg to move, "That the Clause be read a Second time."
    The tax on hydro-carbon oils was imposed in the 1928 Finance Act, and the intention was to derive revenue from oil used in internal combustion engines by means of a duty proportionate to their use. It has worked out as a direct tax on the essential raw materials for many important industries. Many of those important industries have to compete in the open market with products manufactured in other countries which have not this tax to pay. At the time this tax was imposed, pleas were made on all sides for exemption in respect to oils introduced for purely manufacturing purposes, and the arguments used against any exemptions of this character were that there would be great difficulty in dealing with evasion. People would claim exemption on account of oil that they wish to use for manufacturing purposes and would then use it for internal combustion engines. As a matter of fact, I believe the experience of the Department in the early days of the tax on these oils was that a considerable amount of expense was entailed in Revenue Officers going round to certify and to find out whether evasion had taken place.
    Those who represented the fishing industry made a very strong plea to the then Chancellor of the Exchequer to grant exemption in favour of that industry and, on it being brought to his notice that it was possible so to frame regulations that these questions of supervision, inspection and the risk of evasion might be avoided, he accepted an Amendment which exempted the fishing industry from the tax. This new Clause has been drafted on the lines of the Amendment carried in the 1928 Bill, which exempted the fishing industry. I submit to the Chancellor of the Exchequer that this Clause provides an instrument to enable him to do that which he has already intimated his desire to do, namely, to give relief to those who are using hydro-carbon oils as an essential
    196
    raw material in the processes of manufacture without entailing a great deal of expense to the Department which has to deal with the matter and without practically any risk of evasion taking place. I heard the Chancellor of the Exchequer say earlier in the evening that many of the new Clauses on the Order Paper were likely to be accepted. I am sanguine enough to believe that this Clause is one which he is going to accept. I do not propose to argue my case any further, because I expect to hear from the right hon. Gentleman that he is satisfied and is going to accept the Clause.
    Mr. P. SNOWDEN: I am sorry to have to dash the sanguine hopes of the hon. Member. This is not a new Clause which I can accept. We discussed this matter on one of the first new Clauses which were dealt with this afternoon, and, although I was in sympathy with the object, I had to remind the Committee that I could not accept it. The cost, taken in conjunction with the earlier Amendment, would be not less than £500,000 a year, and for that reason I regret that I am unable to accept the proposed Clause.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Payment of estate duty in the form of real property.)
    (1) Subject to the provisions of this section, where an estate passing on the death of any person contains any real property, the Commissiorers of Inland Reveue shall, on the application of the person liable to pay estate duty in respect of the estate, accept the whole or part of such real property in satisfaction of the whole or part of such duty at its value as computed for the assessment of estate duty or at the discretion of the commissioners at such value as may be determined by arbitration to which the commissioners shall refer the question.
    (2) The provisions of sub-section (1) of this section shall not apply in cases where the property tendered does not comprise the whole of the realty, unless the commissioners are satisfied, or it is established by arbitration to which in default of agreement the commissioners shall refer the question, that the selection of the portion to be tendered made by the payer is equitable as between him and the commissioners and will result in a division of ownership of the realty calculated to promote the economic efficiency thereof and to preserve and develop the amenities thereof.
    (3) If it is established by arbitration to which the commissioners may and on the application of the payer shall refer the question,

    197
    that no selection of a portion of the realty to be tendered in satisfaction of the total amount of estate duty payable in respect of the estate is possible which will satisfy the conditions of sub-section (2)of this section, but that these conditions would be satisfied by the selection of a larger portion or the whole of the realty, then the commissioners may purchase such portion or the whole, as the case may be, at a price equal to its value as computed for the assessment of estate duty, and shall pay the difference between such value and such total amount of estate duty out of moneys which may hereafter he provided by Parliament for this purpose.
    (4) Any proceedings at arbitration arising from the provisions of this section shall be taken before the arbitrators established under, and in accordance with the procedure laid down in, the Acquisition of Land (Assessment of Compensation) Act, 1919; and any valuation of real property under this section by such arbitrators shall be made in accordance with the rules laid down in section two of that Act.
    (5) The Commissioners of Inland Revenue may hold any property transferred to them under this section, and shall deal with it in such manner as Parliament may hereafter determine.
    (6) In this section the expression "the payer" means the person liable to pay estate duty in respect of the estate, the expression "realty" means the real property contained in the estate, and the expression "real property" includes leasehold property and mineral rights.—[Mr. Wise.]
    Brought up, and read the First time.
    Mr. WISE: I beg to move, "That the Clause be read a Second time."
    The purpose of the Amendment is to enable the heirs of real property, at their option, to pay Estate Duty in land or in other forms of real property. The reason for the Clause will be very familiar to hon. Members of the House who are in close touch with the problems of the agricultural industry. It is common ground between all parties of this House that at the present moment agriculture is suffering from a shortage of working capital. It is common ground also at this moment that land owning, as compared with other forms of business, if I may use that phrase, is not a very profitable occupation or profession. It is common ground also that for a variety of reasons—the general depression of the agricultural industry, and, I think I am prepared to admit, the effect of taxation over a period of years, taxation imposed by the parties opposite, or continued by them, over a series of Budgets—the landowning class have been left impoverished.
    198
    They have turned to their land in a great number of cases long after they had lost or ceased to possess the working capital necessary to work the land.
    There have been many cases brought to the attention of the public in the last few years in which landowners, finding themselves bound to pay a considerable sum in Estate Duty, have been unable to meet that liability except at the expense of the working of their estate from the agricultural point of view. They have been faced with alternatives. The landowner, left with land but without much for working capital, has had to choose between the awkward alternatives of raising a mortgage, and so impoverishing himself for the rest of his ownership in working the land, or of selling it to the farmers in order to retain them in their occupation of the land, and in that case it is the farmers who are impoverished because they utilise for purchasing purposes capital which ought to be used for agricultural purposes; or else—this, on the whole, is the worst way out—of selling it to speculators or persons whose only purpose is to use the land for non-agricultural purposes, or to get rid of it as quickly as possible by selling it and breaking it up as an agricultural entity or disfiguring it in other ways.
    I do not want there to be any mistake as to my motive in moving this new Clause. I do not do it out of any love for landowners, as such. Its purpose is to meet the case where they are unable to perform the task of financing agriculture and running their estates economically, which is the only justification of their continuation as landowners. I confess, and I do not suppose that it will surprise the Committee, that I share the view of many hon. Members opposite who approach this problem of land ownership from other than a party standpoint—men like certain professors at Oxford, the present Viceroy of India and others—that the only possible solution of the problem of land ownership in this country is, as rapidly as possible, to transfer land from private to public ownership, not only in the interests of the community as a whole but in the interests of the landowners. So long as land remains in private ownership, there is no advantage—[Interruption]—I should be glad if the right hon. Gentleman on the Front Opposition Bench

    199
    would cease interruption—in making it impossible for the landlords to do their job, or making it impossible for them to get out.
    The new Clause proposes to make it compulsory on the Commissioners of Inland Revenue to accept payment of Estate Duty in land when offered to them. By a Clause in the Finance Act of 1910 they were given the option to do that, but it appears that of thirty million acres of land that have become liable to Estate Duty since that time, up to a few weeks ago—[Interruption]—they have accepted in payment something like 1 acre, 2 roods and 2 poles of land, so that that part of the Finance Act has not worked. This new Clause proposes that when land is offered the Commissioners shall be compelled to take it, not necessarily the particular land offered, but land from the estate. Obviously, they must be allowed to choose the land which is worthy to be accepted from the point of view of economic advantage and from the point of view of the efficient and proper division of the estate. I propose also that where it is necessary to get the best economic value out of the estate, or because the whole estate may be usfeul for public purposes, if it is proposed to have payment in land they shall have the right, if they can establish their case on arbitration, to take the whole estate at the value at which it has been assessed for Estate Duty.
    It may be objected on behalf of the Government that this would land the Exchequer in considerable loss of revenue. I have examined the figures carefully, as far as I could from the report of the Commissioners, and, as far as I can tell—the report is not very clear or detailed on the point—the total value of agricultural land that might possibly come within the operation of the Clause would amount to not more than £3,000,000 or £4,000,000 per year, and most of this land could be used for adding to the Crown lands. The Crown Lands Commissioners have, I believe, £3,000,000 or £4,000,000 available for the purchase of agricultural farming land at this moment, which they cannot use except for this purpose, and the immediate loss to the revenue would not be an appreciable sum. Moreover, it would provide land available at once for purposes of
    200
    afforestation, for small holdings and a number of other purposes. It would throw upon the Inland Revenue the responsibility of finding some use for the land but with the demand for small holdings and for afforestation no serious difficulty would arise. I admit that this is a step towards the nationalisation of land, and if it helps out agricultural landlords who are anxious to rid themselves of the burden of landownership and cannot do so, it does it in a manner which safeguards the public interests and carries us along a road upon which I am convinced we are bound to go.
    Mr. P. SNOWDEN: I am afraid that, if hon. Members are to catch their last trains, I shall have to confine my reply to a few sentences. This proposal raises a very big question, and I do not think it can be settled by the method proposed in the new Clause. As a matter of fact, it would not alter the existing law, and what the Government want is money. If they are paid in land, they would have to sell it in order to get money. Many other points might be raised on this new Clause, but, in view of the lateness of the hour, I will only say this: The new Clause raises a large question, and I cannot accept it in the form in which it is on the Paper, but I will promise to give the matter further consideration during the next 12 months and see if the system can be changed so as to facilitate the public acquisition of land more rapidly than is possible under the present law.
    Question, "That the Clause be read a Second time," put, and negatived.

    NEW CLAUSE.—(Exemption from increase of assessment under Schedule A for playing fields.)
    No provision in this Act shall render liable to increase of assessment under Schedule A any lands or hereditaments or any tenement or building used as a necessary adjunct or convenience thereto which are owned, used, and maintained as playing fields or have been dedicated to the public for such purposes by any person, individual or association: Provided that such playing fields are not used or maintained in connection with any business conducted for profit and no profit is derived therefrom.—[Commander Southby.]
    Brought up, and read the First time.
    Commander SOUTHBY: I beg to move, "That the Clause be read a Second time."

    201
    In view of the lateness of the hour, I do not intend to keep the Committee for more than a moment. I am emboldened to move this new Clause by the fact that the Chancellor of the Exchequer is in a mood to accept some of the new Clauses, and I hope that he will, perhaps, accept the principle of this proposal, and if he cannot accept it now, will consider it before the Report stage. It is a proposal which, I think, will meet with sympathy on both sides of the Committee. There is no question of helping any rich concern; no question of helping a rich golf club, or polo club, which is out to make a profit by any assistance from the State. This is a plea for the small playing fields, many of which have a difficult job to keep their head above water, and will be very hard hit by the obvious increase in taxation which must come under Schedule A. It will mean that in many cases they will go under altogether. These small playing-fields cater for a class of persons who find it very difficult to play games because of the scarcity of open spaces, and if the fields are taken away they will have nowhere to go. The Chancellor of the Exchequer is often accured
    of being hard-hearted. Here is a case where he may prove that he is not as hard-hearted as some people believe. If he finds it impossible to accept the new Clause now, perhaps he will give me an assurance that he will consider the matter before the Report stage?
    Mr. PETHICK-LAWRENCE: The hon. and gallant Member has put the case with great persuasiveness, and I am sorry that we shall not be able to accept the proposed new Clause. The issue is this: If it be proposed to make a concession in the case of these playing-fields this is not the place to make it, because the object is to get a different value from the real value placed on these playing-fields. Obviously the right thing to do is to value them at their true value, and if at some future time it should be found possible to make a concession it should be made in the concession that is then proposed.
    Question put, "That the Clause be read a Second time."
    The Committee divided: Ayes, 116; Noes, 215.

    Division No. 418.]

    AYES.

    [11.46 p.m.

    Acland-Troyte, Lieut.-Colonel

    Ferguson, Sir John

    Nield, Rt. Hon. Sir Herbert

    Ainsworth, Lieut.-Col. Charles

    Fielden E. B.

    Oliver, P. M. (Man., Blackley)

    Albery, Irving James

    Fremantle, Lieut.-Colonel Francis E.

    Penny, Sir George

    Atholl, Duchess of

    Gibson, C. G. (Pudsey & Otley)

    Pybus, Percy John

    Baillie-Hamilton, Hon. Charles W.

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

    Ramsbotham, H.

    Balfour, George (Hampstead)

    Glyn, Major R. G. C.

    Rathbone, Eleanor

    Balfour, Captain H. H. (I. of Thanet)

    Gower, Sir Robert

    Rentoul, Sir Gervais S.

    Beamish, Roar-Admiral T. P. H.

    Graham, Fergus (Cumberland, N.)

    Reynolds, Col. Sir James

    Beaumont, M. W.

    Greene, W. P. Crawford

    Roberts, Sir Samuel (Ecclesall)

    Blindell, James

    Gunston, Captain D. W.

    Rodd, Rt. Hon. Sir James Rennell

    Boothby, R. J. G.

    Hacking, Rt. Hon. Douglas H.

    Russell, Alexander West (Tynemouth)

    Bourne, Captain Robert Croft

    Hamilton, Sir George (Ilford)

    Russell, Richard John (Eddisbury)

    Bowyer, Captain Sir George E. W.

    Hanbury, C.

    Samuel, A. M. (Surrey, Farnham)

    Bracken, B.

    Hartington, Marquess of

    Samuel, Samuel (W'dsworth, Putney)

    Braithwaite, Major A. N.

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

    Sandeman, Sir N. Stewart

    Briscoe, Richard George

    Haslam, Henry C.

    Sassoon, Rt. Hon. Sir Philip A. G. D.

    Brown, Col. D. C. (N'th'l'd'., Hexham)

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

    Scott, James

    Brown, Ernest (Leith)

    Herbert, Sir Dennis (Hertford)

    Sinclair, Sir A. (Caithness)

    Bullock, Captain Malcolm

    Hills, Major Rt. Hon. John Waller

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

    Burgin, Dr. E. L.

    Hore-Belisha, Lesile

    Somerset, Thomas

    Carver, Major W. H.

    Horne, Rt. Hon. Sir Robert S.

    Somerville, A. A. (Windsor)

    Chamberlain, Rt. Hn. Sir J. A. (Birm., W.)

    Hunter, Dr. Joseph

    Somerville, D. G. (Willesden, East)

    Churchill, Rt. Hon. Winston Spencer

    Leighton, Major B. E. P.

    Southby, Commander A. R. J.

    Cockerill, Brig.-General Sir George

    Llewellin, Major J. J.

    Sueter, Rear-Admiral M. F.

    Colfox, Major William Philip

    Lymington, Viscount

    Thomas, Major L. B. (King's Norton)

    Colman, N. C. D.

    McConnell, Sir Joseph

    Thomson, Sir F.

    Colville, Major D. J.

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

    Titchfield, Major the Marquess of

    Courtauld, Major J. S.

    Margesson, Captain H. D.

    Turton, Robert Hugh

    Cranbourne, Viscount

    Marjoribanks, E. C.

    Wallace, Capt. D. E. (Hornsey)

    Crichton-Stuart, Lord C.

    Millar, J. D.

    Ward, Lieut.-Col. Sir A. Lambert

    Croft, Brigadier-General Sir H.

    Mond, Hon. Henry

    Wardlaw-Milne, J. S.

    Crookshank, Capt. H. C.

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

    Wells, Sydney R.

    Culverwell, C. T. (Bristol, West)

    Moore, Sir Newton J. (Richmond)

    Williams, Charles (Devon, Torquay)

    Davidson, Rt. Hon. J. (Hertford)

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

    Windsor-Clive. Lieut.-Colonel George

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

    Morden, Col. W. Grant

    Womersley, W. J.

    Dawson, Sir Philip

    Morrison, W. S. (Glos., Cirencester)

    Worthington-Evans, Rt. Hon. Sir L.

    Dixon, Captain Rt. Hon. Herbert

    Morrison-Bell, Sir Arthur Clive

    Duckworth, G. A. V.

    Muirhead, A. J.

    TELLERS FOR THE AYES.—

    Edmondson, Major A. J.

    Nathan, Major H. L.

    Sir George Hennessy and Sir Victor

    England, Colonel A.

    Nicholson, O. (Westminster)

    Warrender.

    NOES.

    Adamson, Rt. Hon. W. (Fife, West)

    Hall, G. H. (Merthyr Tydvil)

    Naylor, T. E.

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

    Hall, Capt. W. G. (Portsmouth, C.)

    Noel Baker, P. J.

    Addison, Rt. Hon. Dr. Christopher

    Hamilton, Mary Agnes (Blackburn)

    Oldfield, J. R.

    Ammon, Charles George

    Hardie, George D.

    Oliver, George Harold (Ilkeston)

    Arnott, John

    Harishern, Rt. Hon. Vernon

    Owen, Major G. (Carnarvon)

    Aske, Sir Bobert

    Hastings, Dr. Somerville

    Palin, John Henry

    Attlee, Clement Richard

    Haycock, A. W.

    Perry, S. F.

    Baldwin, Oliver (Dudley)

    Hayes, John Henry

    Pethick-Lawrence, F. W.

    Barnes, Alfred John

    Henderson, Right Hon. A. (Burnley)

    Phillips, Dr. Marion

    Barr, James

    Henderson, Arthur, junr. (Cardiff, S.)

    Picton-Turbervill, Edith

    Batey, Joseph

    Henderson, Thomas (Glasgow)

    Potts, John S.

    Bellamy, Albert

    Henderson, W. W. (Middx., Enfield)

    Price, M. P.

    Benn, Rt. Hon. Wedgwood

    Herriotts, J.

    Ramsay, T. B. Wilson

    Bennett, Capt. Sir E. N. (Cardiff C.)

    Hirst, G. H. (York W. R. Wentworth)

    Raynes, W. R.

    Benson, G.

    Hoffman, P. C.

    Richards, R.

    Bentham, Dr. Ethel

    Hollins, A.

    Richardson, R. (Houghton-le-Spring)

    Bevan, Aneurin (Ebbw Vale)

    Hopkin, Daniel

    Ritson, J.

    Bowen, J. W.

    Isaacs, George

    Romeril, H. G.

    Broad, Francis Alfred

    Jenkins, W. (Glamorgan, Neath)

    Rosbotham, D. S. T.

    Brockway, A. Fenner

    John, William (Rhondda, West)

    Rowson, Guy

    Brooke, W.

    Jobnston, Thomas

    Sanders, W. S.

    Brothers, M.

    Jones, Rt. Hon. Lelf (Camborne)

    Sandham, E.

    Brown, C. W. E. (Notts. Mansfield)

    Jones, Morgan (Caerphilly)

    Sawyer, G. F.

    Brown, Rt. Hon. J. (South Ayrshire)

    Jowett, Rt. Hon. F. W.

    Shaw, Rt. Hon. Thomas (Preston)

    Brown, W. J. (Wolverhampton, West)

    Jowitt, Sir W. A. (Preston)

    Shepherd, Arthur Lewis

    Buchanan, G.

    Kelly, W. T.

    Sherwood, G. H.

    Burgess, F. G.

    Kennedy, Thomas

    Shield, George William

    Caine, Derwent Hall-

    Kinley, J.

    Shiels, Dr. Drummond

    Cameron, A. G.

    Kirkwood, D.

    Shillaker, J. F.

    Cape, Thomas

    Lang, Gordon

    Simmons, C. J.

    Cartes, W. (St. Pancras, S. W.)

    Lansbury, Rt. Hon. George

    Sinkinson, George

    Charleton, H. C.

    Lathan, G.

    Sitch, Charles H.

    Chater, Daniel

    Law, Albert (Bolton)

    Smith, Ben (Bermondsey, Rotherhithe)

    Church, Major A. G.

    Law, A. (Rosendale)

    Smith, Frank (Nuneaton)

    Clarke, J. S.

    Lawrence, Susan

    Smith, Rennie (Penistone)

    Cluse, W. S.

    Lawrie, Hugh Hartley (Stalybridge)

    Smith, Tom (Pontefract)

    Cocks, Frederick Seymour

    Lawson, John James

    Smith, W. R. (Norwich)

    Compton, Joseph

    Lawther, W. (Barnard Castle)

    Snowden, Rt. Hon. Philip

    Daggar, George

    Leach, W.

    Sorensen, R.

    Dalton, Hugh

    Lee, Frank (Derby, N. E.)

    Stamford, Thomas W.

    Davies, E. C. (Montgomery)

    Lee, Jennie (Lanark, Northern)

    Stephen, Campbell

    Davies, Rhys John (Westhoughton)

    Lewis, T. (Southampton)

    Strachey, E. J. St. Loe

    Denman, Hon. R. D.

    Lindley, Fred W.

    Strauss, G. R.

    Dickson, T.

    Lloyd, C. Ellis

    Taylor, R. A. (Lincoln)

    Dukes, C.

    Logan, David Gilbert

    Thurtle, Ernest

    Duncan, Charles

    Longbottom, A. W.

    Tinker, John Joseph

    Ede, James Chuter

    Longden, F.

    Townend, A. E.

    Edge, Sir William

    Lunn, William

    Vaughan, D. J.

    Edmunds, J. E.

    MacDonald, Rt. Hon. J. R. (Seaham)

    Walkden, A. G.

    Edwards, C. (Monmouth, Bedwellty)

    MacDonald, Malcolm (Bassetlaw)

    Walker, J.

    Edwards, E. (Morpeth)

    McElwee, A.

    Wallace, H. W.

    Egan, W. M.

    McEntee, V. L.

    Watson, W. M. (Dunfermline)

    Elmley, Viscount

    McGovern, J. (Glasgow, Shettleston)

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

    Evans, Capt. Ernest (Welsh Unives.)

    McKinlay, A.

    Wellock, Wilfred

    Foot, Isaac

    McShane, John James

    Welsh, James (Paisley)

    Forgan, Dr. Robert

    Malone, C. L'Estrange (N'thampton)

    West, F. R.

    Freeman, Peter

    Mansfield, W.

    Westwood, Joseph

    Gardner, B. W. (West Ham, Upton)

    Marcus, M.

    White, H. G.

    Gardner, J. P. (Hammersmith, N.)

    Marley, J.

    Whiteley, Wilfrid (Birm., Ladywood)

    Gibbins, Joseph

    Marshall, Fred

    Whiteley, William (Blaydon)

    Gibson, H. M. (Lancs, Mossley)

    Mathers, George

    Williams, David (Swansea, East)

    Gill, T. H.

    Matters, L. W.

    Williams, Dr. J. H. (Lianelly)

    Gossling, A. G.

    Messer, Fred

    Williams, T. (York, Don Valley)

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

    Middleton, G.

    Wilson, C. H. (Sheffield, Attercliffe)

    Granville, E.

    Milner, Major J.

    Wilson, J. (Oldham)

    Gray, Milner

    Morgan, Dr. H. B.

    Wilson, R. J. (Jarrow)

    Greenwood, Rt. Hon. A. (Colne)

    Morley, Ralph

    Wise, E. F.

    Grenfell, D. R. (Glamorgan)

    Morrison, Herbert (Hackney, South)

    Young, R. S. (Islington, North)

    Griffith, F. Kingsley (Middlesbro' W.)

    Morrison, Robert C. (Tottenham, N.)

    Griffiths, T. (Monmouth, Pontypoel)

    Mort, D. L.

    TELLERS FOR THE NOES.—

    Groves, Thomas E.

    Moses, J. J. H.

    Mr. Parkinson and Mr. Wilfrid

    Grundy, Thomas W.

    Mosley, Lady C. (Stoke-on-Trent)

    Paling.

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

    Murnin, Hugh

    Question, "That the Clause be read a Second time," put, and agreed to.

    NEW CLAUSE—(Applications by spouses for separate assessment to income tax or sear-tax to have effect until revoked.)
    (1) Subject to the provisions of this Section an application duly made, whether before or after the passing of this Act, by a husband or a wife—.
    204

    (a) under Rule 17 of the general rules for separate assessment to Income Tax for the year 1930–31 or any subsequent year of assessment; or

    (b) under Sub-section (9) of Section forty-two of the Finance Act, 1927, for separate assessment to Sur-tax for the year 1929–30 or any subsequent year of assessment;

    205
    shall have effect not only as respects the year of assessment for which it is made but also for any subsequent year of assessment.
    (2) A person who has made any such application as is mentioned in the last preceding Sub-section for any year of assessment may give for any subsequent year of assessment a notice to withdraw that application, and where such a notice is given the application shall not have effect with respect to the year for which the notice is given or any subsequent year.
    (3) A notice of withdrawal under this Section shall be in such form and shall be made in such manner as may be prescribed by the Commissioners of Inland Revenue, and shall not be valid unless it is given within the period allowed by law for making, for the year for which the notice is given, applications similar to that to which the notice relates.—[Sir H. Nield.]
    Brought up, and read the First time.
    Sir HERBERT NIELD: I beg to move, "That the Clause be read a Second time."
    I have reason to believe that this proposed new Clause will be accepted by the Chancellor of the Exchequer. It provides that where there is an application by a husband or a wife for separate assessment, that application shall continue to be effective, in future, until it is revoked.
    Mr. P. SNOWDEN: I accept the new Clause.
    Clause added to the Bill.
    Motion made, and Question, "That the Chairman do report Progress, and ask leave to sit again," put, and agreed to.—[Mr. P. Snowden.]
    Committee report Progress; to sit again To-morrow.

  BRITISH NORTH AMERICA BILL [Lords].
  Read a Second time.
  Bill committed to a Committee of the Whole House for To-morrow.—[Mr. J. H. Thomas.]
  The remaining Orders were read, and postponed.
  It being after half-past Eleven of the Clock upon Monday evening, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing, Order.
  Adjourned at Two Minutes after Twelve o'Clock.

TRADE AND COMMERCE.
  CHINA.
  CHINA.
  COMMERCIAL INTELLIGENCE.
  COMMERCIAL INTELLIGENCE.
  INVISIBLE EXPORTS.
  INVISIBLE EXPORTS.
  RAILWAY CONTRACTS, TANGANYIKA.
  RAILWAY CONTRACTS, TANGANYIKA.
  BREAD (PRICE).
  BREAD (PRICE).
  EMIGRATION.
  EMIGRATION.
INDIA.
  POLICE CASUALTIES (COMPENSATION).
  POLICE CASUALTIES (COMPENSATION).
  CHILD MARRIAGE RESTRAINT ACT.
  CHILD MARRIAGE RESTRAINT ACT.
  TERRITORIAL FORCE (HIGHER GRADE COMMISSIONS).
  TERRITORIAL FORCE (HIGHER GRADE COMMISSIONS).
  SHOOTING INCIDENT, KARACHI.
  SHOOTING INCIDENT, KARACHI.
  DISTURBANCES, LUCKNOW.
  DISTURBANCES, LUCKNOW.
  SUBVERSIVE PROPAGANDA (FILMS).
  SUBVERSIVE PROPAGANDA (FILMS).
  POLICE TELEPHONE CALL-BOXES, LONDON.
  POLICE TELEPHONE CALL-BOXES, LONDON.
HOUSING.
  BUILDING COSTS (LOCAL AUTHORITIES).
  BUILDING COSTS (LOCAL AUTHORITIES).
  UNEMPLOYED OPERATIVES.
  UNEMPLOYED OPERATIVES.
  CYPRUS (NEWSPAPERS).
  CYPRUS (NEWSPAPERS).
  STRAITS SETTLEMENTS (MILITARY CONTRIBUTION).
  STRAITS SETTLEMENTS (MILITARY CONTRIBUTION).
  EMPIRE MARKETING BOARD (FILM).
  EMPIRE MARKETING BOARD (FILM).
  CONTRIBUTORY PENSIONS, SCOTLAND.
  CONTRIBUTORY PENSIONS, SCOTLAND.
NAVAL AND MILITARY PENSIONS AND GRANTS.
  SEVEN YEARS' LIMIT.
  SEVEN YEARS' LIMIT.
  NEED PENSION.
  NEED PENSION.
  LONDON TRAFFIC (HORSE-DRAWN VEHICLES).
  LONDON TRAFFIC (HORSE-DRAWN VEHICLES).