Estate Duty.

Orders of the Day — Ways and Means. – in the House of Commons at on 23 April 1923.

Alert me about debates like this

10. "That where property situate out of Great Britain is bequeathed to or settled on different persons in succession and legacy duty or succession duty is payable thereon, such duty shall for the purposes of Subsection (2) of Section two of the Finance Act, 1894, be deemed to be payable in respect of the property on the death of each of those persons in succession, notwithstanding that the whole amount of the duty is paid on one death only as in the case of a legacy to one person."

First Resolution read a Second time.

Photo of Mr William Pringle Mr William Pringle , Penistone

I beg to move to leave out the word "eightpence" and to insert thereof the word "fivepence."

4.0 P.M.

In addition to the Amendment which I now propose, of which notice has been given by several of my hon. Friends and myself, there are other Amendments in the names of hon. Gentlemen in other parts of the House. There is one on behalf of hon. Members above the Gangway proposing the reduction of the Tea Duty from eightpence to one penny. There is another Amendment in the name of hon. Members who sit in front of me proposing its reduction to fourpence. I am not going to enter into the various reasons for which these different figures have been suggested, but the reason why my Friends and I have taken the figure of fivepence as the figure to which the duty should be reduced is that fivepence represents the figure at which the duty stood in 1914. It is true that since the War a change has taken place, and that at the present time, although the general rate of duty stands at 8d., owing to the operation of Imperial Preference, the duty which is imposed and charged upon all tea imported from different parts of the Empire is five-sixths of the general rate. The consequence, therefore, of this reduction would be that in respect of foreign tea the duty would be 5d., and in respect of tea from the Dominions and from other parts of the Empire it would be five-sixths of that rate. I do not propose to enter into any comparison as to the merits of this and other particular taxes. I would make only one observation regarding the proportions of direct and indirect taxation. I believe that the custom of retaining control on the part of the House of the Tea Duty on the one hand and of the Income Tax on the other is to secure annually control in a special degree of the relations of direct and indirect taxation. That, I understand, is one of the reasons why both the Income Tax and the Tea Duty have to be imposed afresh every year. It is therefore important that we should consider the extent to which in the current year and in the past year direct taxes and indirect taxes have been reduced respectively. Last year certain concessions were made to both classes of taxpayer—to the Income Tax payer to the extent of 1s. in the £ and to those who consume tea to the extent of 4d. in the lb.—and there are in this year's Budget provisions also for the relief of these two different classes of taxpayer. The relief to the indirect taxpayer on this occasion is granted in respect of beer, which is not an article of general consumption to the same extent as tea—[HON. MEMBERS: "Oh!"]—and, indeed, is not an article of general consumption at all in certain parts of the country. We have, of course, the relief in respect of Income Tax.

It is therefore important that the House should be aware of the amounts which these different classes of taxpayer are receiving by way of relief. Last year the relief granted to the payers of indirect taxes was, in a full year, £5,457,000. On the other hand, the relief to the Income Taxpayers amounted to £53,700,000, and the relief owing to certain concessions in the Excess Profits Ditty was £3,000,000, so that last year, although the payers of indirect taxation only received concessions amounting to £5,457,000, the direct taxpayers benefited to the extent of £56,700,000. I think the House will agree that is not a fair, proportionate division of the relief. In other words, the direct taxpayer is receiving relief to the extent of 10 times more than the indirect taxpayer. It is true that this year there is, on the whole, a fairer balance. Beer and the other duties along with beer, according to the Treasury, represent a loss to the Exchequer of £16,875,000, whereas the concessions in regard to Income Tax and to the Corporation Profits Tax amount, in a full year, to £38,500,000. My contention is that, as beer is not as necessary as tea and is not an article of general consumption to the same extent as tea, it does not represent the same amount of relief to the class of indirect taxpayers generally; and the claim which I now put forward on the basis of the figures which I have just read to the House is that the general consuming public have not received the same relief in respect of what may be called necessaries as the payers of direct taxation. The first ground, therefore, on which I move a further reduction of the Tea Duty is that the proportionate relief which ought to be given on the general principle of justice as between different classes of taxpayer has not up to the present been given.

There are a number of objections which may be taken to the Tea Duty, and I need not conceal from the House that, had it been possible to move a reduction in regard to another tax at this stage, I should have preferred to have done that instead of dealing with the Tea Duty; but at the present stage of the Budget it is only by means of the Tea Duty that the great mass of consumers of a necessary of life can receive what I consider is an adequate concession under the proposals of the Chancellor of the Exchequer. The first objection which can be taken to this duty, as well as to other indirect taxes, is that such a duty in every case takes more out of the pockets of the taxpayers than goes to the Exchequer. This is a particularly serious matter when we consider the distressed condition of large numbers of people who are compelled under present conditions to pay this duty. The tax collector in regard to tea is the grocer or, rather, the wholesale dealer, from whom the grocer purchases. You have, therefore, the profits of all these middlemen charged in regard to this duty, with the result that the duty, particularly in relation to the poorer qualities of tea, is very much heavier than the amount which is returned to the Exchequer.

This brings me to a further point. This duty, not being an ad valorem duty, falls much more heavily on the consumer of the poorer qualities of tea. You have tea at the present time which is probably well under 1s. per lb. in value apart from the duty, and, on the other hand, you may have tea which costs as much as 5s. per lb. The charge made to the consumer, as the result of the duty, will in one case represent 100 per cent. and in the other only 12½ per cent. This, I think, shows the unfair incidence of the duty, and I think the House is bound on every opportunity to seek from the Chancellor of the Exchequer a reduction of a duty which cperates in that way. There is another matter in relation to tea to which we take exception on this side of the House, and that is the differential character of the duty. There is the preferential provision in relation to India. There is no doubt that the differentiation in respect of India, operating as it does in favour of Indian producers, means that on the whole the consumers of tea in this country have to pay more. They pay more in respect of all tea imported from India and Ceylon. Consequently, there is more charge by reason of the duty than goes to the Exchequer. A certain proportion of the duty on that account goes to the producers in Indian and Ceylon.

I am not going to enter into the question as to whether or not the preference is justified in relation to India. I can understand hon. and right hon. Gentlemen opposite arguing in favour of preference on the ground of the benefits which various Dominions have conferred upon the trade of this country. It may be argued that, as Australia and Canada and New Zealand have granted a substantial preference on British manufactures, it is the duty of the Government of this country to make some recognition of these concessions and to grant a preference to their products when imported into this country. But this argument does not seem to me to apply at all, and certainly does not apply with the same force, in relation to India, because, since this preference has been granted, India has set up tariffs against British goods. The only return which India has made for the preference up to the present time has been a heavy tax upon the Lancashire cotton industry, so that the results which we are told were to flow from preference have not materialised so far as the Indian Empire is concerned.

The greatest objection of all to this particular duty is that it is a duty which falls upon the great mass of consumers, not in proportion to their ability to pay, but in proportion to their necessities. It therefore violates one of the first principles of all taxation, namely, that there should be equality of sacrifice. Instead of their being equality of sacrifice in regard to this particular duty, you have the greatest possible inequality. It is mainly for this reason that the House should insist that there should be a gradual abolition of all those indirect taxes which affect the necessaries of life. We should gradually bring our system to the condition in which the only indirect taxes are those which fall upon luxuries, and therefore may be described as voluntary in their incidence.

I do not desire to enter into any discussion as to the comparative merits of the remission of the duty upon tea and the duty upon beer. Some hon. Gentleman opposite questioned my suggestion that tea was an article of more general consumption than beer, and that a remission of the duty on tea would benefit a larger number of people of this country. I thought that that was a self-evident proposition. One is a luxury, and the other, to the poorest of our people, has become a necessary. The Tea Duty presses upon large classes who have the greatest difficulty, under present conditions of trade, in making ends meet. It is not only that it falls upon all those who are pensioners of various classes—the old age pensioners, and those who are in receipt of war pensions from the Ministry of Pensions—but there are also those who are in receipt of relief either from local or national funds. This duty is coming out of the slender pittance which these people receive. We have also to remember that owing to the present depression there are large classes of wage earners, practically all classes of wage earners, who are suffering deductions of wages. The wages of agricultural labourers have recently been before the House, and it has been admitted on all hands that in many parts of the country these agricultural labourers are receiving less than a living wage. It should, therefore, be the duty of this House, when adjusting taxation, to see that those whose financial position is such as I have described, are the first to benefit by any surplus which is at the disposal of the Chancellor of the Exchequer. Though the surplus of the Chancellor of the Exchequer for the current year is small, yet the funds which he has at his disposal could be made available for the class upon whose behalf I now plead.

I am not suggesting any readjustment of the remissions which the Chancellor has proposed. There may be, indeed, dispute in different quarters of the House as to the effects upon trade and upon different individuals of remissions of Income Tax and remissions of the Beer Duty. This at least can be said in regard to tea—that any remission on tea would be a remission for the benefit of the great mass of the people. It would be a remission in favour of people who are in dire need of such a remission, and in favour of those who, under present conditions, have hardly the means of maintaining a decent standard of life. Not only would it be a relief to those individuals and classes, but it would also contribute in a small way towards the improvement of the general trade of the country. It may be said of the remission of Income Tax that such remission will be spent upon luxuries and useless articles. If there was a remission of the Tea Duty, it is safe to say that at least there would not be an extra louis going upon the table of Monte Carlo, an additional yacht on the Mediterranean, or an additional dinner at the Ritz. It would be a real boon to all classes of pensioners, a real relief to all whose wages have been reduced and are being reduced, and in particular a relief to the 1,500,000 unemployed who are now being helped from the local and national Exchequer.

Photo of Mr Hastings Lees-Smith Mr Hastings Lees-Smith , Keighley

The Labour party had put down an Amendment to reduce the Tea Duty from 8d. to 1d. The purpose of that Amendment, of course, was to indicate our opinion that the duty ought to be abolished entirely. But I understand that the main Debate is to take place on this particular Amendment; therefore, on behalf of the Labour party, I take the opportunity of expressing my opinion now. We think that the duty upon tea and the duty upon sugar are the two most vicious and indefensible taxes in the whole of our fiscal system. Some of the remarks which fell from the Chancellor of the Exchequer in his second speech last week indicated that his opinion also runs in that direction. The tax upon tea and the tax upon sugar are taxes on the necessaries of life. Tea is not a luxury. There is nothing cheaper that the people can drink, except water, and I do not suppose that there is any Member of this House who proposes that the people shall drink water and nothing but water.

Photo of Mr David Kirkwood Mr David Kirkwood , Dumbarton District of Burghs

Water for the workers and beer for them.

Photo of Mr Hastings Lees-Smith Mr Hastings Lees-Smith , Keighley

The effect of a tax upon tea is practically the same as the effect of a tax upon bread. I believe that the last statistics show that if you increase the price of either of these articles the consumption is very little affected, because they are such primary necessaries that the people must have them, whatever the price. And they do have them. But they have to restrict their consumption of food and clothing, and boots and shoes, and other necessities for a civilised and even for a healthy existence. All the alleviations and modifications by which other taxes are adjusted to the conditions of different classes in the community, and of people of different needs, are all absent from the tax upon tea. There are many defects in the Income Tax, but, all the same, those with the largest incomes pay the heaviest tax, and those with the strongest backs bear the heaviest burdens. But that is not the case with regard to tea. The consumption of tea is more or less uniform in all classes of the community. The masses of the people drink a certain amount, and the wealthiest people in the country cannot drink much more. At the same time, the tax upon the cheapest tea is the same, or practically the same per pound, as the tax upon the more expensive qualities.

Photo of Sir Basil Peto Sir Basil Peto , Barnstaple

All the cheaper tea comes in under preferential duties.

Photo of Mr Hastings Lees-Smith Mr Hastings Lees-Smith , Keighley

There was an Amendment on preference for tea last year, when the whole of that subject was discussed, and certainly the conclusion of the hon. Member was not that stated by the Government Front Bench at the time. The amount of tax paid by the poorer section of the community is practically the same as the amount of tax paid by the richest. There is another feature of the tax which has not yet been brought out. The Income Tax admits the fact that the man with the largest family ought to have special treatment, and by the system of abatements the larger the man's family the less he pays in Income Tax. But in the case of tea exactly the opposite principle is followed; the larger the family the greater the consumption of tea, and, therefore, the larger the tax that is paid. For these reasons the taxes on tea and sugar are the two worst taxes in the whole of our fiscal system. There are certain arguments which are used in defence of this tax, and to them I will refer. The hon. Member for Ilford (Mr Wise), in a very informative speech on the night of the Budget, dealt with the connection between direct and indirect taxation. He pointed out that before the War the relationship was broadly 50 per cent. of the one and 50 per cent. of the other, and he indicated that he thought that was about a fair proportion. I would reply that the proportion of indirect taxation, the taxation which falls upon the mas of the community, has risen continuously since the War.

In the year 1917–18, the last full year of the War, it was 17 per cent. of the total; in 1921–22 it was 33 per cent.; in 1922–23 it was 36 per cent.; and this year, owing to the fact that the Beer Duty has been diminished by £16,000,000, and Income Tax and Corporation Profits Tax, which fall on the more comfortable classes, have been diminished by £38,000,000, the amount of indirect taxation is a greater proportion of the total than in any year since the War ended. Although I give those figures, I cannot say that I attach great importance to the argument one way or the other. The whole of this argument about the proportion of direct and indirect taxation is academic, unreal, and meaningless. The hon. Member for Ilford quoted the 50 per cent. proportion before the War, but what is the particular sanctity of 50 per cent. of the one and 50 per cent. of the other? Why is it more sacred than 60 per cent. of the one and 40 per cent. of the other, or any other proportion which I might give? The criterion of a good tax is that it should be equitable, economical, and productive, and that it should not fall upon the necessaries of life. When the hon. Member seems to suggest that we should impose a tax like this, he is breaking through the criterion of a good tax, because he is the slave of a shibboleth of mid-Victorian finance, which has no application to the conditions of the present day.

Photo of Mr Fredric Wise Mr Fredric Wise , Ilford

My point was that the country which had the greatest direct taxation was the country which had the most unemployment. That was my argument right through. As long as you have a big percentage of direct taxation you have unemployment.

Photo of Mr Hastings Lees-Smith Mr Hastings Lees-Smith , Keighley

In any case, I hope that the hon. Gentleman agrees with me that any arguments as to the proper percentage of direct and indirect taxation are a fetish which ought not any longer to be introduced into this House. I think one can predict, from the course of previous debates in this House, the line of defence which the Chancellor of the Exchequer will follow. He will tell us that we must not regard this Tea Duty as an isolated duty, that we must take it in connection with the tax system of the country as a whole, and that, whatever we may say against it by itself, in relationship with all the other taxes it is a good tax. To that the reply can be given that no tax is a good tax which trenches upon the necessaries of life. When the Chancellor was considering what he should do upon this question, he ought to have taken into account the very special conditions which confront the people of this country at the present time. At this moment there are 1,500,000 people unemployed, and of the remainder millions have not sufficient wages to maintain physical efficiency for themselves or healthy constitutions for their children. Surely, there has never been a period in which a Chancellor of the Exchequer would have been more justified in taking off every tax which can be shown to affect the stamina of the people. The Chancellor of the Exchequer seemed to indicate that he realised that fact, because he, stated that had it not been for the special difficulties created by peculiar market conditions, he, himself, was anxious to reduce the duty on sugar. One is justified in asking, if he wanted to do that and was prevented for special reasons, why did he not then take off the duty on tea, which is the twin duty to the Sugar Duty, which has much the same effect and in regard to which the market conditions present no obstacle at all? It would have cost him just under £12,000,000, but, instead of that, he spends £16,000,000 in reducing the duty on beer. As against this reduction of £16,000,000 on beer, which is, broadly, a concession to the masses of the people, he has reduced by £38,000,000, the Income Tax and the Corporation Profits Tax which are paid, on the whole, by the more comfortable classes. For that reason we say that this is a rich man's Budget. It is a Budget which gives £16,000,000 to the great mass of the people and £38,000,000 to the comparatively small section who are comfortably off. This Budget is unfairly weighted against the poorer section of the community and its result will be that at the end of this year, the poorer section of the community will be paying a larger proportion of the total volume of taxation than during any year since the War came to an end, while the richer section will be paying a smaller proportion. That is why we call it a rich man's Budget and that is why we ask that in this particular, at any rate, in should be corrected.

Photo of Sir Basil Peto Sir Basil Peto , Barnstaple

The hon. Member who has just sat down concluded his speech by stating that this was a rich man's Budget. Arguments of that class leave altogether out of consideration the ultimate effect upon the trade of the country and upon the employment of the mass of the people, of heavy taxes such as the two he quoted, namely, the Comporations Profits Tax and the Income Tax. I do not agree, and the hon. Member himself did not seem to agree, that you can regard direct and indirect taxation as if they were in watertight compartments, and yet, if you do not so regard them, there is no basis whatever for the argument about the rich man's Budget or the poor man's Budget. I hold that all heavy taxation, such as this country is enduring at the present time, ultimately tends, through its effect upon trade, to injure the poor man. We see it clearly demonstrated day by day and, therefore, when I found the hon. Member saying he did not attach much importance to that line of argument, I was hopeful that he would not conclude his speech with a platform appeal about the rich man's Budget. I wish to deal with part of the speech made by the hon. Member for Penistone (Mr. Pringle). He seemed to ignore the fact that, with regard to the bulk of the tea imported into this country, there is a reduction now of just about the amount by which he asks to have this duty reduced, namely, the preference on tea grown within the Empire. All his argument seemed to be based on the assumption that the poor man was mere hardly hit than the rich man, because the rich man drank a very expensive class of tea on which the rate of tax fell very lightly—looked at as a percentage—whereas, in the case of the poor man it fell very heavily, because he only drank the cheaper classes of tea. We have first to consider where this tea comes from. I am aware that some of the very high growths, Darjeeling tea for example, are grown in India and fetch very high prices in the market here, but, in the main, the poor man's tea is Ceylon tea. There is no question about that. When you find tea advertised as the cheapest kind of tea—"Our 2s. Tea," and that sort of thing—you will find that it generally comes from Ceylon and India, and is a low grown tea which can be sold at a very cheap price. I do not know whether the House is aware of the proportion as between the tea which pays the full duty and the tea which pays the lower duty. I asked a question on the subject as lately as 19th April, and I find that the amount collected at the full rate of duty is £1,557,000, and the duty collected at the preferential rate is £9,998,000. Therefore, there is very little in the arguments which have been put before the House on the basis of this being an 8d. tax. It is 5⅓d.

Photo of Sir Basil Peto Sir Basil Peto , Barnstaple

No, I think not. One-third off 8d. would be 5⅓d.

Photo of Mr William Pringle Mr William Pringle , Penistone

I think the hon. Gentleman is mistaken. The preferential rate is five-sixths, not two-thirds.

Photo of Sir Basil Peto Sir Basil Peto , Barnstaple

I thank the hon. Member. I was under the impression it was a one-third preference. It is quite true then, it is rather over 6d. per lb. I shall feel perfectly satisfied in voting against this Amendment. Although no one on any side of the House wishes that heavier duties than are absolutely essential should be placed upon any of the necessaries of life, I think it is perfectly true, as was said by the hon. Member who spoke last, that you have to look at these Budget proposals as a whole, and I do not think that the proportion between direct and indirect taxation is unfairly weighted in favour of the rich man, even looking at the matter from the narrowest point of view. I have another reason. I have always been opposed to the principle of raising such an enormous proportion of our revenue indirectly from two articles in the production of which we are practically uninterested in this country. From tea and sugar we raised £50,000,000 last year. Except with regard to a very minute production of sugar none of that duty can do anything to assist production in this country. The principle of Preference in raising revenue undoubtedly has increased production within the Empire. It has increased the total quantity of those products which are available for consumption and has tended to keep down the price, but I have been looking to see whether we could not transfer these duties without in any way infringing on the fiscal system of the country, and I would like to see them left at their present level, until we can go into the whole question of devising a wiser method of collecting our indirect taxation. For these reasons I shall be perfectly satisfied to vote for the duty as it stands, as I believe it is a part of a well balanced, very conservative and very reasonable Budget. It must be taken in connection with the reduction proposed to be made on beer, which, though not as universal an article of consumption as tea, is one a reduction on which will undoubtedly be appreciated as a great boon and a great remission in the working man's budget throughout the country. So far as I am concerned, I do not fear in the least any capital that may be made out of arguments about the Income Tax. I think we may confidently leave the matter in the hands of the Chancellor of the Exchequer for another year, feeling certain that under his wise guidance in the matter of finance the country will soon be in a much more prosperous condition, and that the remissions now sought for can then be made.

Mr. W. A. JENKINS:

I rise, not for the purpose of making any factious criticism. That would be wrong and unjust. On the contrary, I would like to express my congratulations to the Chancellor of the Exchequer for the eminently businesslike Budget which he has placed before the House, and for the lucid manner in which he has amplified it. I regard it as a businesslike and statesmenlike attempt to place the finances of the country on a sound economic basis. I regret, however, that the Chancellor has not seen his way to make a substantial reduction in the taxation on tea and sugar. I think it is quite right that there should be a reduction in the Beer Duty, but I see no reason whatever why beer should be singled out for consideration and no provision made for a reduction in the duty on tea and sugar. The Chancellor of the Exchequer has given businesslike reasons why it is not expedient just now to reduce the Sugar Duty. He sates that in view of the conditions existing in the sugar market of the world, even if a reduction were made, that reduction would not find its way into the pockets of the consumer. I do not dispute that argument, but it does not apply to tea. Tea is the most popular and the real national beverage. Poets have immortalised it as The cup that cheers but not inebriates. and it has been described as a Safe, sober, sage and venerable liquid. Of all the necessities of life, none is in greater or more general use than tea and a reduction in the duty would be welcomed by all sections of the community. Every working-class family would welcome it and certainly it would be a boon to the women of this country. It would prove to them that the cost of living, in at least one direction, was coming down. In 1921 a Tea Duty of 1s. in the £ produced £17,500,000. In 1922 the Tea Duty was reduced to 8d. A reduction now of 3d. per lb would mean, roughly, £4,500,000 to £5,000,000, which I suggest the Chancellor of the Exchequer could well afford. Furthermore, I would suggest another form of taxation which would compensate for this reduction. Great Britain has a, monopoly in the production of Scotch whisky for which, we are told, there is no substitute the world over. Notwithstanding the fact that it is exported out of bond, I think, free of all duty, yet no matter in what part of the world you seek to purchase Scotch whisky you have to pay a much higher price than is charged in this country, even taking into consideration extra freight and other charges. In 1916 the quantity exported was 9,563,718 gallons. In 1917, 1918 and 1919 the quantity fell off, no doubt owing to the reduced stocks of matured spirit and the large demand for spirit for explosive purposes for the War. In recent times, however, the demand abroad has increased, and in round figures we are exporting to-day 10,000,000 gallons of Scotch whisky per annum. I suggest that this could easily stand a duty of 10s. per gallon. The revenue, about £5,000,000, would fully compensate for a reduction of 3d. a lb. on tea The cost of collection of this £5,000,000 would be practically nil, as the formalities necessary to get clearances from bond would not be increased. It would only be necessary to hand over a cheque for the amount of the duty when dealing with the Customs papers for clearance. In view of these considerations, I earnestly hope the Chancellor of the Exchequer will see his way to make special efforts to reduce the Tea Duty by 3d. a lb.

Photo of Mr Henry Charleton Mr Henry Charleton , Leeds South

It has already been pointed out that the Tea Duty falls heavily on the working classes, on people like widows and charwomen, who earn a precarious living doing rough housework, but the class I want to plead for are men like railway men, who work at night. Engine-men, signalmen, shunters, guards, and fogmen like tea, on account of its stimulating qualities, to prevent them from getting drowsy at their work. This may seem a poor case, but when food was controlled I had the honour of stating a case for railwaymen for more tea to the late Lord Rhondda, when he was Food Controller, and he saw quite well that there was something in it. May I, as an old railwayman, inform hon. Members that we have the greatest difficulty, when young men first go out to work on night work, which is lonely work as a rule, in keeping them awake, and it is only after years of training that a man can resist the drowsiness which overtakes him in the early hours of the morning. We have to take our drinks with us when we go to work, and I have tried water, coffee, cocoa, and tea.

I am a life abstainer and have never tried beer, and I do not know what the effect of it would be, but I have heard that one sleeps soundly after beer, so that it would not be wise or safe to take it on railway work; but I do say, quite earnestly, that tea is of very great assistance, to men working on night work, in keeping awake, owing to its stimulating qualities, and I think a moment's reflection will convince the House what a serious thing it would be if an engine driver were to go to sleep on an express train. I can say quite seriously that I have been assisted in keeping awake and vigilant by using tea, because it must be remembered that railwaymen on night work, living in a working-class district, cannot sleep so peacefully as the average man would, say, in Mayfair or Brook Street—[Laughter]—where there are no children playing about in the streets. Hon. Members laugh, but I have never heard an Italian grinding an organ in that district in the small hours of the morning, neither do we see children playing nor hear men shouting coals or vegetables, or the muffin man with his bell. Generally speaking, in that district, where I notice that a number of hon. Members opposite live, it is very quiet at night, but in a working-class district the street is the playground for our children, and we do not send our children away for other people to look after in the country. Our children are always at home and playing in the streets, and many a time I have done a night's work on the footplate and gone home to bed and have not got a wink of sleep. Two or three families live in a house in London, and I have gone and done a second turn of duty without having been to sleep in between, with the responsibility of human lives behind me, rushing through to Leeds or Manchester, and my fellow workmen's lives also.

A fogman or a platelayer, after a laborious day in the winter, or in the autumn, when we get the autumn fogs, goes home, and after, say, a couple of hours in bed—and these are very low paid men—he is called up because fog comes. He goes away and there, silently, beside a signal he lights a little fire, and occasionally trains pass. The safety of the train and its precious lives depends on that man keeping awake, and there is nothing that will help him so well as a cup of hot tea, which he brings in his can and keeps warm. Railwaymen, although something has been said about their wages, have already given up, as Sir Eric Geddes has shown, £40,000,000 a year. Coming events cast their shadows before them, and many people have envious eyes on the railwaymen's wages, and who can know what a year will bring forth or what will be the position by the time the next Budget comes round? It may be that their wages will be reduced. At all events, there are many of those men, on whom the safety of the travelling public depends, who are on very low wages, and this Tea Duty hits them rather hard, because, as a body, railwaymen drink more tea than the average citizen, and I urge the Chancellor of the Exchequer to give this point his consideration.

Photo of Mr Carlyon Bellairs Mr Carlyon Bellairs , Maidstone

It would be out of order for me to follow the hon. Member for Keighley (Mr. Lees Smith) into the relative merits of direct and indirect taxation. We are dealing with the Tea Duty. He did not mention, nor did any of the other speakers on that side of the House, the fact that we have already made two concessions to tea since the War. We gave a preference in 1919, and we took 4d. off last year. I doubt very much whether the consumer in the whole year has got the benefit of that 4d. The price has been steadily rising, and the conditions are similar to what the Chancellor of the Exchequer stated in regard to the Sugar Duty, namely, that it is a seller's market. Only about three days ago I received a circular from some tea merchants which interested me very much, because it gave an extract from the "Evening Standard" of an interview with a Mincing Lane tea merchant, and this is what was said: 'Unless the outlook changes considerably, there is a prospect of still dearer tea in the near future,' declared a Mincing Lane authority to-day. 'There has been bad weather for two years running in India and Ceylon—an almost abnormal position,' he said, 'and this resulted in a shortage of 60,000,000 lbs. in the present year's world supply. Prices have been going up steadily for the past two years, and have practically doubled. An important factor is the increase in consumption since 1914 in the United Kingdom—the chief tea-consuming country. In 1914 the annual consumption of tea per head was 6½ lbs., and it is now 8½ lbs. That is to say, you have a rising consumption side by side with a shortage of supply, and I doubt very much whether the Chancellor of the Exchequer, by reducing the duty, would not merely lose his money without benefiting the con- sumer. For that reason, and bearing in mind that, personally, I should like to see the Beer Duty reduced still further, that I do not want to give away anything for nothing, that the Beer Duty can be a matter of bargain in regard to price, and that the consumer does get the full benefit of it, I think the Chancellor would be very unwise at this moment, with the experience he has had in regard to the 4d. concession last year, if he made a fresh concession in regard to the Tea Duty this year, because I do not believe it would benefit the consumer. That does not prevent us from desiring to see the Tea Duty reduced the very moment we can see that the reduction can be passed on to the consumer. We must remember that we have had those two concessions in regard to the Tea Duty. The consumer does not appear to have got the benefit of them, and it is possible, in the case of beer, to point to a very large increase in the duty since the War; in fact, it has been doubled. Therefore, when comparisons are made, as they have been, by hon. Members opposite between tea and beer, we have to remember that there has been a reduction in the duty on tea, and it is very doubtful if that reduction has been passed on to the consumer, whereas there has been a doubling of the Beer Duty since the War.

Photo of Mr Oswald Mosley Mr Oswald Mosley , Harrow

The hon. and gallant Member for Maidstone (Commander Bellairs) has advanced an argument which the Chancellor of the Exchequer advanced solely in relation to the Sugar Duty, and I cannot help thinking that, if the right hon. Gentleman had shared the view of the hon. and gallant Member, he would have linked up that argument with his argument on the Sugar Duty, as it would have greatly strengthened his case, but surely the case of tea is altogether different from that of sugar. Even if the argument of the Chancellor of the Exchequer in relation to sugar be admitted, which I, personally, do not admit in its entirety, it may be true that there is a shortage in the supply, but there is also a great falling off in the normal consumption. For instance, the greatest tea-drinking community in the world, Russia, is making practically no demand upon the tea market. Further, the hon. and gallant Gentleman forgets that the same monopolistic conditions do not apply in the tea industry as apply in the sugar industry. We derive our tea supply, not from one, but from a variety of sources, and competitive elements enter into these transactions which are lacking in the case of sugar. The hon. and gallant Member said that the full benefit of the reduction in the Tea Duty has not been handed on in the past to the consumer, and he argued that any reduction in the Beer Duty must, of course, be handed on in its entirety to the consumer. I should be out of order in referring to that matter on this Vote, but I think it will be proved on a subsequent Amendment that the last reduction in the Beer Duty was by no means altogether handed on to the consumer, and that a considerable proportion of that reduction found its way into the pockets of the brewers.

The greater part of this controversy has raged round the perennial topic of the relative demerits of direct and indirect taxation, and the hon. Member for Ilford (Mr. Wise) has advanced, by way of interjection, a very remarkable contention in this respect. He argued, as I understood him, that the unemployment existing in countries to-day was more or less in proportion to the burden of direct taxation. I think, anyhow, that he said that the country which to-day had the greatest proportion of direct taxation had also the greatest proportion of unemployment.

Photo of Mr Fredric Wise Mr Fredric Wise , Ilford

I said it affected unemployment.

Photo of Mr Oswald Mosley Mr Oswald Mosley , Harrow

I understood the hon. Member to say that the country which to-day bore the greatest proportion of direct taxation had also the greatest proportion of unemployment.

Photo of Mr Fredric Wise Mr Fredric Wise , Ilford

Yes, it affected the unemployment.

5.0 p.m.

Photo of Mr Oswald Mosley Mr Oswald Mosley , Harrow

The hon. Member forgets that in the period of the greatest unemployment, prior to the present period, which this country has ever passed through, our system of taxation was not direct, but entirely indirect. After the Napoleonic Wars, there was practically no direct taxation. There was the greatest and most comprehensive system of indirect taxation that the world has ever seen. The hon. Member for Ilford, with his great knowledge of these matters, recalls that very vivid passage in some contemporary economist, whose name I forget, where he describes the tax upon every article of consumption prevailing at that period and says that from the cradle which introduces a man to this world to the coffin which heralds his exit he has to pay indirect taxes on practically every article of daily consumption. At that period, under the Pitt system of indirect taxation, this country bore a burden of unemployment commensurate with that which it bears to-day. The problem of unemployment is not so much decided by the relative weight of direct and indirect taxation as it is by the question of markets, and perhaps to an almost equal degree by the manner in which the country handles its currency problem. That is more important than the question of indirect and direct taxation. But even if it be admitted, as it has been strongly argued from the other benches that taxation is a direct factor in the industrial depression, I contend that a greater case can be made out against indirect taxation than against direct taxation. To begin with, an indirect tax which falls upon the needs of the working man tends to curtail his expenditure on the necessities of life and, consequently, do depress his standard of living. A tax like this on tea falls on his weekly budget; it depreciates the purchasing capacity of the working man and he is consequently unable often to provide himself with the necessaries of life. That affects his physical efficiency and consequently his industrial efficiency. Indirect taxation must in all cases press on the necessities of life of those who are least able to meet the burden, and it directly impairs their industrial efficiency.

But it is argued that direct taxation is a greater factor in the actual cost of production than indirect taxation; it is argued that direct taxation raises the cost of production and curtails the home market and handicaps our manufacturers in this country in competition in the home and foreign markets, but if that be the case, then it must be admitted that the great manufacturers of this country are not paying their direct taxes out of their own normal profits or out of their own resources, but are handing it on to the consumer. If profits are raised on account of direct taxation, then manufacturers are not paying their taxes out of their normal profits but, by raising prices, they are handing it on to the consumer. I do not believe that this is always the case. I do not believe direct taxes are always taken into account in the preparation for the making of profits, but indirect taxation must always be a direct factor in the cost of production for the obvious reason that, to-day, owing to our great and beneficient trade organisations, men do not suffer their standard of life to be depressed below a certain level. Consequently, in our post-War arrangements, wages are to a large extent if not entirely based on the cost of living; they vary in many cases with the cost of living; consequently, anything which tends to raise the cost of living tends to raise wages, and to raise the cost of production. I venture to contend that along that line of argument it can be proved that indirect taxation is a far more important factor in raising the cost of production and in handicapping this country in the home and in the foreign markets than direct taxation. Therefore, for those reasons, I think the Chancellor of the Exchequer, apart from all the humanitarian considerations which have been so ably stated by hon. Members, should very seriously consider the readjustment of direct and indirect taxation. But I would not ask him to accept this Amendment by means of doing away with the remission of direct taxation which he has proposed. I would ask him to effect a reduction of this character by effecting economy in the same way that he managed to effect it last year. It is, after all, one of the great means at the disposal of Parliament for effecting economy to reduce supplies to the Government. I think it was a failure of revenue to the extent of some £90,000,000 in the year before last that first taught the Treasury to economise during the current year. They were faced with this tremendous falling off in revenue, and they found that unless they economised during the coming year they would be confronted with a deficit. As far as my memory goes, they managed to economise to an extent of £69,000,000 to £70,000,000. If Parliament wants to effect economy, the way to do it is to cut down Supply. I think, consequently, we could make a reduction of this kind and leave it to the Chancellor of the Exchequer to exert himself still further in the admirable course of economy.

Photo of Sir Percy Newson Sir Percy Newson , Tamworth

I did not intend to intervene in this Debate, but I have been impelled to do so by certain remarks made by the hon. Member for Penistone (Mr. Pringle) on the question of the Indian Tea Duty. He said we give this preferential treatment to India in regard to tea and all we got in return for it is an Import Tax on Manchester goods. I would like to point out to him in regard to India that the great majority of the tea-growing concerns are registered in this country, and therefore any profits arising from this industry are subject to British Income Tax and Corporation Profits Tax. That is one of the advantages, and there are many others. This tea has to be brought down from gardens in some cases 100 miles from the port and put on board ship. The steamers that bring these cargoes down are for the most part owned by two large companies which are registered in England. They have a capital between them of something like £3,000,000 sterling, and they are subject to British Income Tax and Corporation Profits Tax. Apart from that, the staffs in charge of the tea gardens are recruited from this country. Men go out there for a number of years and, when they return home to this country after some years of service, they again become subject to taxation here. In that way you gain a very real and important advantage to the British Exchequer by granting this preference to Indian tea. If you want to export your Manchester goods to India, the only way for India to pay for them is by way of the exports which she sends here. The greater the preference you give to India the more tea she supplies you with, and in that way, by exporting more tea, she is able to buy more goods from Manchester. These are a few of the directions in which it is perfectly obvious that the preference you give to tea from India is of direct advantage to this country.

Photo of Dr William Chapple Dr William Chapple , Dumfriesshire

While there is a tax upon tea there is not the least harm in giving a preference to our own Dominions within the Empire. The hon. and gallant Member for Maidstone (Commander Bellairs) claimed credit for the last Government because they took 4d. off tea, but he said it with a tone of pathos in his voice, and apparently he regretted that the 4d. had been taken off on the ground that the consumer did not get the advan- tage. That may be given as an argument against the remission of any taxation. There is no doubt that, if the 4d. had been retained 12 months ago, the people who have been consuming tea in the interval would have been paying 4d. more for the tea. If, as he says, prices rose because of the abnormal conditions in Ceylon, they still would have risen with these abnormal conditions, and the 4d. would still have been added to the increased price due to these abnormal conditions. The argument for this Amendment, I think, is overwhelming, especially in contrast with the other taxes. A concession on tea would be a concession to the home; a concession on beer is not a concession to the home—it is an hindrance and disadvantage to the home; it is the enemy of the home. A concession on beer is a concession to the saloon. Our men-folk, speaking generally, inhabit the saloon. Our children, mothers and wives inhabit the home. Any concession on tea is a concession to the women and children in the homes of our country, and a concession on beer is a concession to the drinker and to the trade. There is no escape from that argument. All through, the Budget is a concession to wealth and to monopoly. There is not one item in the whole of this Budget which is a direct concession to the home. Women and children do not benefit by this Budget. There is nothing in the Budget which lessens the cost of living to the workers as inhabitants of our homes.

I am not going to follow out the distinction between direct and indirect taxation; I shall try to distinguish between revenue taxation and policy taxation. This Tea Duty is revenue taxation. If you impose a tax on tea, you impose it for the one motive of providing the Exchequer with the proceeds. The tax on beer is very largely a policy tax. Throughout the whole history of taxation in this country, there are men who have favoured a tax on beer for a policy end, not a revenue end, namely, to reduce the consumption of beer. Put a tax on beer and make it dearer, and people will consume less. That has been demonstrated during recent years, and more especially since the War. While there is a heavy tax on beer, there is a lessened consumption. Reduce the tax on beer, and you increase consumption. Take a man who is drinking beer in a saloon. He may drink that beer until all his wages are gone. [HON. MEMBERS: "Oh!"] I have not tried it, but I have watched those who have tried it.

The trade has declared in all its publications that the oppressive tax on beer has reduced consumption, and, therefore, limited profits. They say, "Take away the tax on beer, and you increase the consumption." The Stock Exchange has shown its anticipations of the Budget. It is estimated that the cheaper the beer the more there will be consumed, but the more beer consumed, the more injury inflicted on the homes of our country. The homes of our country are going to suffer the more that beer is consumed. They are not going to suffer the more that tea is consumed. Tea has become an essential in every home of the land, the poor homes particularly, because, unlike the rich homes, they cannot have an infinite variety of beverages. Therefore, if you lessen the duty on tea, you cheapen tea, and increase the consumption of tea for the benefit of the homes. Take the tax off beer, and you cheapen beer, and, accordingly, you increase the consumption of beer, to the injury of the drinkers and of their homes. There is no statesman too exalted to turn his first and most absorbing attention to the conditions of the workers in their humble homes. To me, all other considerations of international concern and of national concern pale into insignificance beside this first duty of every statesman to see that the people are living in wholesome and happy conditions. People cannot live in wholesome and happy conditions if the cost of living is high, and every concession we make to the homes of our country, every time we take off a tax from those homes, it will lessen the pressure of the conditions under which they are forced to live.

This is certainly a rich man's Budget and a Tory Budget, because it is a concession to the people who sent the Tories here in a majority. It is a fulfilment of all the Tory pledges on the Tory platforms during the last Election. Those who support this side of the House come from the homes of the people. The other side of the House is supported by monopolies, by vested interests, by the liquor traffic, by the great corporations, and this Budget has made a concession to every one of those vested interests, but not a single one to the homes of the people. The Corporation Profits Tax is a concession to the great corporations who sent here hon. Members opposite. There is the concession to the great Income Tax payers, but not to the small Income Tax payers. By grading all taxes, under which you ask a man with a small income to pay at a low rate, and a man with a high income to pay at a high rate, you are following a well-acknowledged and well-accepted principle, and under such a system, instead of taking 6d. or 1s. off the top, you should take it off the bottom—I will not say take the whole 1s. off the bottom. The Chancellor of the Exchequer is amused at that. Apparently he does not sympathise with that view. Let me put it in this way, for the sake of example. If you have people up to £500 income paying, say, 2s. 6d. in tax, and people up to £1,000 paying 5s., then, if you are going to reduce the tax by 1s., you ought to take it off the 2s. 6d. and not the 5s. The greater concession should be made to the smaller incomes, and the lesser concession to the higher incomes. That is a well-known principle. Supposing you had 5s. in taxation—

Photo of Lieut-General Edward Fitzroy Lieut-General Edward Fitzroy , Daventry

The hon. Member is getting away from tea.

Photo of Dr William Chapple Dr William Chapple , Dumfriesshire

I am sorry, but I was drawn off by the smile that adorned the features of the Chancellor of the Exchequer, and was giving an illustration. The same principle applies. If you are going to make a concession under a system of graduated taxation, it should be done in such a way that the man at the bottom enjoys first and most the concession that you make. An hon. Member who spoke from the Labour Benches said that he was in favour of the tax being taken off tea, because tea kept railwaymen awake. May I make some reference to the advantages of tea as compared with beer? It has been proved by recent experiment and observation that tea is a true stimulant, that it really has a dietetic value. Some say that tea is more injurious than beer or other beverages. It has been proved by experiment—not by giving people tea, and asking them how they feel, but by giving them tea, and observing them, and recording the effects of tea upon them by instruments of scientific precision—and it has been demonstrated that tea is a true stimulant, that it increases the energy and vitality to a very small extent, but that its injurious influences have been greatly exaggerated. First of all, my object in supporting this Amendment is that I think the homes should get a remission of taxation, and not the vested interests, and it is the vested interests which have got the concessions throughout the whole of the Budget. I will not go into the other concessions that might be made to the homes, because Amendments are down with which I shall have an opportunity of dealing later on.

Photo of Mr Samuel March Mr Samuel March , Poplar South Poplar

I want strongly to support the appeal which has been made to the Chancellor of the Exchequer to make this reduction on the Tea Duty. Many of the speakers have referred to the benefit it would confer on the home. There is one section of the community which has not been mentioned, and that is the old age pensioners. I know that many of these people have a severe struggle to exist, and if there could be a reduction of taxation in the homes of those people, it would be a great boon to them. Many times they have asked whether there is a possibility of getting an increase of their old age pension, and from time to time we have approached the Chancellor of the Exchequer to see whether he had any intention of increasing the amount of pension to these old people. Finding that he is not in a position to do that, surely he might assist them in some way, and I believe it would be in a good way if he would reduce the amount of the duty on tea. There are also a number of widows who have been pensioned through losing their husbands in the War, and a reduction on the Tea Duty would be a great boon to them. There are also a number of people who are receiving relief, and who are forced to receive relief. They have a difficulty in living on the amount which is allowed them by the different boards of guardians. I am sure a reduction of the Tea Duty would be of great benefit to them. I can quite confirm what has been said by previous speakers as to people desiring this reduction. I was having a talk with a number of men at a meeting the other night, and I put to them the question whether they would have preferred something off tea and sugar rather than 1d. a pint off beer. They unanimously said they would sooner have a reduction off tea and sugar in the home. This was in a public-house, by the way. I was very pleased to receive that reply, because they happened to be transport workers, and I am a representative of the transport workers. Our desire is to keep these men as near as possible with clear brains and clear minds. The more opportunities and facilities you give to these people to get tea when out on their journeys—sometimes night and day, and sometimes two nights and a day, and so on—the better, as they have to get refreshments at different places, and we would prefer that they should have tea as against beer. I was very pleased, therefore, to hear the men say that they would prefer a reduction on tea and sugar rather than on beer.

I am going to support what has been said with regard to this being a rich man's Budget and a conservative Budget. One hon. Member—I believe it was the hon. Member for Barnstaple (Mr. Peto)—said it was a conservative Budget. If the statement comes from the other side that it is a conservative Budget, we naturally ought to accept it as such. As a matter of fact, we did accept it as such before the hon. Member said so. However, he has confirmed it, and we believe it all the more. To prove that it is a conservative Budget, the Chancellor proposes to take something off the Income Tax. There are not many transport workers who have to pay Income Tax, because they do not get money enough. Therefore, a reduction in the Income Tax will not benefit them, as would a reduction in the cost of living, and, as a previous speaker said, it would benefit their employers as well, because their wages are based on the cost of living. A big proof that it is a conservative Budget is that it relieves those people who have got the most. We are hoping that the time is coming when we shall be able to give benefit to those who have got the least. That is one idea of the Capital Levy, which you are going to discuss one day or the other. I desire strongly to support this Amendment, and trust that the Chancellor of the Exchequer will give these matters every consideration, and, if possible, reduce the cost of living by taking something off tea.

Photo of Mr George Buchanan Mr George Buchanan , Glasgow Gorbals

I must confess that previous to entering Parliament I always wondered on what system the old age pension of 10s. per week was granted, because it seemed to me that, having granted that pension on account of the poverty of the recipients, Parliament, or those concerned, immediately proceeded to take that 10s., and, whether male or female pensioner, having erected elaborate machinery at the cost of many hundreds of thousands of pounds, endeavoured to ensure that he or she did not receive above a certain sum annually. Having done that, we then proceeded to impose taxation on sugar and tea in order to take the 10s. back that we had already granted. It seemed to me to be a most silly system to grant 10s. per week and then to take advantage of the position by indirect taxation. May I join issue with the hon. Gentleman the Member for Dumfries (Dr. Chapple) in regard to what he said on liquor? If I believed like him—and, in a sense, I do—I should have voted, or rather he should have voted, on Friday for the Measure of the hon. Member for Dundee (Mr. Scrymgeour). Nobody detests drunkenness more than I do. I hope, however, when I fight the liquor traffic, I am going to do it in a straightforward, open, honest fashion. The argument of the hon. Member, it seemed to me, was to the effect that, if you reduced the price of liquor, naturally the persons who bought it had more money to spend on other commodities, and in this I agree, but he said you are allowing a man to spend more upon liquor. I do not wish a man to spend more upon liquor—

Photo of Dr William Chapple Dr William Chapple , Dumfriesshire

What I said was that the beer drinker, instead of saving money on the concession made to him, simply drank more beer, and that was the worse for his home.

Photo of Mr George Buchanan Mr George Buchanan , Glasgow Gorbals

Let me take the point of the hon. Member. The beer drinker is given a concession and drinks more; consequently, with the concession on tea the money so saved would be used in order to drink more tea! But my only point is this, in respect to liquor, that if you reduce the tax you do not in reality abolish so much drinking—it is perfectly true you increase the consumption to some extent, though if you keep a high tax on beer, it seems to me, that again, as suggested, the children suffer, because your confirmed drunkard does not care two iotas about the children, he will get liquor no matter what the price is, he will get it at any time and in any place.

In regard to the Liquor, Tea, and Sugar Duties, I say that they are not a proper method of raising taxation in this country. For my part, the best method is the ability of the person to pay taxation. Once you get away from that fundamental point, then you are going on the wrong basis altogether. Speaking personally, I join issue with hon. Friends in different parts on this side of the House in their suggestions to get a reduction of the tax on tea, and for this reason: I think tea is a staple article of food. If you tax tea, you decrease the spending power of the working people, and if you decrease that spending power you intensify, to some extent, unemployment. If you decrease the spending power of the ordinary working-man's wage, you stop him buying other commodities that he would wish to do. Also, I note the fact that the Budget in its concession in respect to Income Tax differentiates with 6d. above £500, and 3d. below £500. The Conservative party, even in this, could not get away from the trammels of wealth, and, I presume from those who contribute heaviest to its exchequer at election time.

As one goes up and down the country—and I will just say this practically last word to the Chancellor of the Exchequer—one must come to the conclusion that this Government cannot last too long. [Laughter.] I am sorry if hon. Friends do not understand that observation. My Scottish colleagues do. Perhaps I had better convey my remarks in English, for what I mean is that this Government cannot last above a short time. Everybody, I think, is more or less agreed upon that. I want the Chancellor of the Exchequer, when he leaves office, not to leave office with a Budget of this kind to his credit. There are in it concessions to the wealthy and concessions to every person before the ordinary working man. For the sake of the right hon. Gentleman retaining his good name—and I say this earnestly—I would remind him that every man in high political life endeavours, as did the late Lord Shaftesbury, and other great men, even of the Conservative party, more or less give to political life some little contribution to ease the life of the downtrodden masses of this country. Everyone has done a little in the way of advancement; not in the way I would have done it, perhaps, but at least the men did something during his term of office in the manner I have indicated. Here, however, we have this Chancellor of the Exchequer likely to have only one Budget to his credit, and he is putting it forward in such a way that I am bound to say is not likely to be to his credit in the future. I am pleading in regard to this Budget, and I would say to the right hon. Gentleman that he needs to contribute less to the wealthy classes of the country, and more to ease the lives of those masses to which I belong, and which I represent here.

Photo of Mr James Hogge Mr James Hogge , Edinburgh East

After the interesting lecture on the ethics of public life to which the Chancellor has just listened, I have no doubt he will take thought and mend before he brings the Budget to a conclusion. There are one or two consideration which I think the Chancellor ought to give weight to in his reply to the Amendment moved by my hon. Friend the Member for Penistone (Mr. Pringle). This discussion on the Tea Duty raises a threadbare controversy in this House as to the merits of direct and indirect taxation. I am perfectly certain that the very legitimate pride that the Chancellor takes, and is entitled to take, in the Budget must be accompanied by some chagrin that the only change he has been able to make in the relations between direct and indirect taxation is in regard to a luxury, namely, beer. The other concessions which have been made in indirect taxation deal only with some postal changes. Those he has suggested are changes which will not affect the larger part of the community, but that section of the community which is getting relief from direct taxation in the Budget. The concessions which have been made in regard to telephones and postal matters are made largely to people who pay Income Tax, and not to people who pay taxation only through indirect means. Therefore I would put the point that it does seem somewhat curious that the Chancellor himself, in his first attempt to equalise the burden of taxation, has been driven to reduce a luxury, and that luxury, beer.

One point to be taken into consideration in this argument is that the Chan- cellor himself confessed quite freely—and I think quite honestly and sincerely—that he would have preferred to have reduced the tax on sugar. If I listened to his argument correctly the one reason which induced him to depart from reducing taxation on sugar and to reduce taxation on beer was the financial argument of the supply of sugar in the world's markets. He held that were he to reduce the tax upon sugar the benefit of that tax would not reach the consumer whom he desired to benefit, and that, therefore, for this year he postponed the idea of reducing the tax upon sugar. At the moment it is neither right nor possible to go into the merits of sugar taxation, but I would like to say that the Chancellor, having shot himself up by his own arguments—whether right or wrong—we will oppose those arguments when we come to the Finance Bill and the taxation on sugar—when he so shut himself up he forgot the close relationship which exists between tea and sugar.

Presumably the reason the Chancellor desired to reduce the tax upon sugar was that he quite honestly thought by doing so he would bring relief to the indirect taxpayer and the consumer, and to large masses of the working people. If he were precluded from doing that because of his own reasons he could at any rate have brought about the same effect by making this reduction asked for in the taxation on tea; his desire to reduce the taxation on sugar was a desire to make a contribution to the kitchen table of the people. He might have had some credit had he, when he was faced by his own financial argument about sugar, instead of immediately turning to beer, taken his courage in both hands and said, "Very well, if I cannot make this reduction for the kitchen tables of the country by means of a reduction of the sugar tax, I will get it by reducing the taxation on tea," and therefore the emphasis could have been laid upon tea and not beer. I suggest to the Chancellor that he might have taken that position, and I shall be glad if he will do me the honour in his reply of answering that point, because I have admitted quite frankly that I believe him to be quite sincere when he said that he had a desire to reduce the tax upon sugar. He passed from that, I think his own word was "reluctantly"—passed from sugar reluctantly, and yet did not take within his scope one of the most essential articles of diet on the tables of the people of this country. I still think that there is to that extent some force in the argument of my hon. Friend the Member for the Gorbals Division (Mr. Buchanan), that if the Chancellor had had a care to his subsequent credit, and the methods in his Budget, as others have endeavoured to have, he might have merited a great deal more credit from a reduction in the household expenses of the workers of this country than he will from any reduction on a luxury.

Speaking as a Scottish Member, I say that this reduction of the Beer Duty is no concession at all to the people of Scotland, because we do not drink beer in Scotland. We are made of much sterner stuff, and the consumption of beer is a habit which we regard as effeminate. After all, this Government receives some little support from Scotland, although I admit it is not a very great deal. There is no part of the country where the Government receives less support than in Scotland, and their action recently has diminished that support very considerably. A reduction of the Beer Duty is no advantage to the people of Scotland. [An HON. MEMBER: "What do they drink?"] If my hon. Friend wants to know what the people of Scotland drink, I will stand him some after the Debate. Whether he will be able to take part in the subsequent Debate I do not know. The working classes in Scotland will suffer more than the working classes south of the Tweed because of the fact that the Chancellor of the Exchequer is not reducing the duty on tea or sugar. He is ignoring the argument as to the inequality of the tax owing to the different habits of the people in different parts of the country, and as the right hon. Gentleman has made up his mind that he cannot reduce the tax on sugar he has gone out of the category of the needs of the people into the luxuries. That is the case which the right hon. Gentleman requires to defend if he can make a case at all against the arguments which have been put forward.

Photo of Major Sir Archibald Boyd-Carpenter Major Sir Archibald Boyd-Carpenter , Bradford North

At the outset I wish to refer to the appeal which has been made by the hon. Gentleman who has just sat down. I can assure him that there is no discourtesy intended in my right hon. Friend not rising to reply to his remarks, because it had been arranged that I should have this duty put upon me, and the Chancellor of the Exchequer will have an opportunity, no doubt at some later date on subsequent Amendments, to reply to the remarks made by the hon. Member for East Edinburgh (Mr. Hogge). It will be within the knowledge of the House that this Debate on the reduction of the Tea Duty is a hardy annual, which is usually moved on this occasion, and sometimes on the Finance Bill. Nevertheless, it is one that always elicits more or less of a general discussion, and perhaps, with great humility, I may be allowed to suggest that the Debate on the reduction of the Tea Duty has ranged over a considerable variety of topics other than the one included in the Amendment. After all it is a debatable point as to which taxes are to be considered most essential. Beer and sugar have been discussed, but for the moment I have to deal with tea, and I will deal with that question. I should only like to say, in passing, something regarding the remarks of the hon. Member for the Gorbals Division (Mr. Buchanan), who, in referring to the speech of the Chancellor of the Exchequer, stated that it would be a pity if my right hon. Friend went out of office with only this Finance Bill to his credit. He seemed to forget that the only object of this Finance Bill is to protect the credit of the nation, and not the Chancellor's own credit.

Although I think the Tea Duty is something worthy of our consideration, it seems to be forgotten that of all the impositions in this country of any importance at all from an Excise or Customs point of view, the Tea Duty is the least onerous of any, and has had more reductions than any other article. There have been two reductions in the Tea Duty during the last few years. It was reduced last year in the Budget, when 4d. was taken off the duty, and again in 1919, as a concession to the British Dominions, when there was this grant of one-sixth. About 90 per cent. of the tea consumed and paying duty in this country comes from British Dominions. There is a duty of 8d. on all tea from foreign sources. That is maintained. It is a fact that the duty paid upon 90 per cent. of the tea consumed in this country is 6⅔., which is only 1⅔d. more than the duty levied and maintained by the Liberal party in 1914. If you compare that with the increase upon the price of ordinary foodstuffs, it will be found to be 65 per cent., which is less than the increase in the cost of ordinary foodstuffs in this country. Therefore, it cannot be seriously argued that a definite case has been made out for the reduction of this duty. There may be other cases for consideration by the Chancellor of the Exchequer in due time as to reduction, but I do not think it can be legitimately argued to-day that with regard to an article of consumption which 100 years ago was considered to be a luxury, that the increase in price over and above pre-War is excessive.

What does it mean, after all is said and done? I notice that one hon. Member quoted the Chancellor of the Exchequer's speech on the last year's Budget, in which he said this tax was a good tax. No tax is a good tax, but it is an unenviable necessity, and if we are to obtain our revenue we must have a source of revenue in some way or other. In this case the revenue we expect next year from this duty is £11,000,000, and if it is reduced, as suggested by this Amendment, we shall lose £3,900,000 a year. We cannot afford to lose that amount. If this reduction is made, from what source will the deficiency in revenue come? It can only be maintained by putting the burden on other people. There is a limit to taxation and to revenue sources, and it is therefore really impossible, much as we should like to reduce all taxes of this character, to ask the Government to accept this Amendment when under the circumstances this duty cannot be regarded as an excessive burden of taxation in relation to other burdens of taxation.

Equally, it cannot be regarded as something we can give up, because it gives us a legitimate, ready and regular source of revenue. If we allowed this reduction we should only have to look elsewhere for other sources, and I am certain that although hon. Members call this a conservative Budget, probably they would have remarks of a still more virile character in regard to other sources of revenue which would be necessary, and which we should have to propose, if we accepted this Amendment. I have already pointed out the very small amount of burden that is put by this duty upon this particular source of revenue by taxation compared with taxation of another character. I have pointed out the loss of revenue and I do not believe that the House generally would be prepared to accept the argument that although this is an indirect source of revenue, this is the appropriate time to wipe out from the Budget of to-day a revenue which gives us something to meet our needs. We cannot now discuss the relative values and proportions of direct or indirect taxation. Therefore the proposal to reduce this tax is one which we cannot contemplate from any point of view.

Photo of Mr Godfrey Collins Mr Godfrey Collins , Greenock

The Financial Secretary to the Treasury argued that the Government could not accept this Amendment because the revenue would suffer to the extent of £4,000,000. My hon. Friends have forestalled that suggestion, because in the next Amendment which will be called from the Chair we point out quite definitely that without placing any further burden upon the taxpayers the loss of revenue which this Amendment would entail would be amply made up if the Government could see their way to accept our proposal. Therefore, so far as the contention of the Financial Secretary is concerned on that point, we submit an alternative scheme to the Government proposal. My hon. Friend, in moving this Amendment, took note of the Speech of the Chancellor of the Exchequer in the Budget Debate, and it is very clear from that speech that the right hon. Gentleman had decided not to accept any reduction of the Sugar Duty. If the speech delivered by the Chancellor of the Exchequer on that occasion had foreshadowed that his mind was not receptive in regard to a reduction of the Sugar Duty, my hon. Friends would not have proposed this Amendment. Believing, as we do, that the consumers of beer should not be the sole people to receive benefit from the Chancellor of the Exchequer on this occasion, and in view of the unsatisfactory answer made by the Financial Secretary, we shall press this Amendment to a Division.

Photo of Sir William Jowitt Sir William Jowitt , Hartlepools, The

At the beginning of this Debate I had no intention of intervening, but having regard to the unsatisfactory nature of the reply made by the representative of the Government, I beg in- dulgence of the House to make a few observation, and I do so for this reason. A very large number of those who have taken part in this Debate have been Members of previous Parliaments and have heard this question discussed before. I know this subject is regarded as a hardy annual, but I wish to represent to the House the view of new Members who are considering this question here for the first time.

6.0 P.M.

Speaking for myself, and, I think, for all of them, I rather resent the suggestion that the question whether a certain particular duty at a particular rate is to be imposed or not should be determined or assessed with regard to the decisions of previous Parliaments given at previous times. This fallacy, if I may respectfully so call it, seems to me to have been running through, not only the reply to which we have just listened, but also the speech of the Chancellor of the Exchequer in introducing his Budget. The right hon. Gentleman passed over, I will not say with contempt, but in a sentence, the possibility of remitting the duty on tea; and why? Because, he said, something had been taken off tea on the last occasion. What does it matter? I was not a Member of the House of Commons then, but I have yet to learn that every single thing that was done by the Coalition Government is so sacrosanct that it is not even open to criticism. And frankly, I say, for my own part, that the argument that tea was taxed at a certain level in 1914 by the party to which I have the honour to belong leaves me equally cold. If it is right now, let us have it at 8d.; if it is wrong, let us reduce it, but without regard to what was done in past years.

Really, the only argument of the Financial Secretary to the Treasury in answer to this Amendment was what I may call the historical argument—that, because 4d. was taken off in 1922, therefore, nothing is going to be taken off this year. As I followed the hon. and gallant Gentleman's speech, the only other point that he raised was that it is a valuable tax, that it brings in a considerable sum of money, and that, if we remit it, we shall have to impose a tax somewhere else. Many of the previous speakers have discussed the relative importance of tea and beer. The question of beer always seems to engender a certain amount of heat, particularly in those who are teetotallers. I opposed the Bill that we discussed last Friday. I have myself often drunk beer, and I hope I shall continue to do so. I regard it neither as effeminate nor yet as a kind of criminal act to do so. At the same time, when you are going to remit taxation, the true point in regard to whether you are going to take it off tea or beer is, surely, this, that the remission ought to apply to some commodity which tends to spread equally over all those who pay indirect taxation. A large number of people in this House and elsewhere—I suppose about half of them—drink beer. A large number of people do not, and those who do not—I see my hon. Friend the Postmaster-General sitting on the Government Bench—those who do not drink beer get on very well without it.

Photo of Sir William Jowitt Sir William Jowitt , Hartlepools, The

Therefore, it is demonstrable that beer, after all, is a luxury. If we could afford to do it, I should, personally, like to remit the taxation both on beer and on tea; but, if we are driven to choose between the one and the other, surely hon. Members in all quarters of the House will agree with me, if they consider this fairly, as I am sure they will, that it is better to choose that one which practically every member of the community drinks, and which, undoubtedly, is not a luxury, but really is a necessity, whatever it may have been a hundred years ago. Therefore I urge the Government not to be too much tied down by precedent and not to worry too much about how they are to raise this money. One speaker suggested an export duty on whisky, and others have suggested a transfer of the duty from tea to beer. As some hon. Members were not here while the hon. Member for Keighley (Mr. Lees Smith) was addressing the House, perhaps he will allow me to repeat his argument, which, to my mind, was conclusive. He said that in regard to Income Tax, if you have a large family, you get a rebate, but, in the case of tea, the larger your family the more you pay in this tax. At the present time, when wages have come down right to the subsistence level, I cannot think that the continuance of a tax which taxes a man according to the needs of his home can be right or justifiable. In these circumstances, much as we should like to remit the duty on beer as well as on tea, if it is to be either the one or the other I say most certainly let it be a remission of duty on tea. Therefore, I would add my voice to those on this side of the House who have already urged that this tax ought to be reduced.

Photo of Mrs Margaret Wintringham Mrs Margaret Wintringham , Louth Borough

I had no opportunity last week of offering my congratulations to the Chancellor of the Exchequer on the manner in which he brought in his Budget, and I do so now; but—and it is, perhaps, rather a large "but"—I think it is a very one-sided Budget. It is essentially a man-made Budget, and I could not help having a vision of this House if the benches were filled with the other sex, and two men Members were standing up and supporting what they thought right. I had a feeling that, if that had been the case, there certainly would have been some remission in the taxes on the food which the housewife has to provide. I think that, perhaps, the Chancellor of the Exchequer has not quite realised that nearly half the voters in England are women. They were expecting a very great deal from this Budget, and they certainly would have liked the question of tea and sugar to be considered before the question of beer. A reduction of a penny a pint on beer, which would amount to about a shilling a week on the ordinary working man's wage, will not benefit the housewife at all. It does not come out of her pocket, but out of his, and she does not have any more to spend in consequence.

I think that women, generally speaking, resent the fact that they have been rather overlooked in this Budget. The middle-class women, no doubt, have received a good deal of help. They appreciate the fact that their telephone is going to be cheaper. They appreciate the fact that their postal charges will be a little cheaper—that is particularly appreciated by the women Members of Parliament—and also that the Income Tax is reduced. This afternoon, however, I want to make a plea for the ordinary working housewife, who at the present time is one of the most heavily burdened and taxed people in the country. There is nothing in this Budget that is going to promise her relief. The food taxes are left as they were, and she feels that, instead of the Beer Duty being reduced, she ought to have had some relief for her breakfast table. In courts of summary jurisdiction a wife is often asked by the magistrate, "What is wrong with your husband?" and she usually says, "He is a good husband if it were not for the drink." I do not think the opposite could be said—that a wife would be a good wife if it were not for tea. Tea is a beverage which is very unharmful, and in a small home it is used to a considerable extent. The wife brews her own beverage, and it is very often taken three or four times a day. Certainly half a pound or a pound is consumed per week in small homes where the wage is small, and the tax is very heavy now, particularly in the agricultural districts such as the one which I represent

and which I know so well. In homes where the weekly wage is only 25s., a tax of 8d. on tea is a very large item. As the hon. Member for East Edinburgh (Mr. Hogge) said, the Chancellor of the Exchequer has not the excuse that there is not a good crop. There is a good crop at present, and it is a good season, and there is no cause in that respect why the ditty should not be reduced. For these reasons I make a plea on behalf of the housewife, who is, in a sense, a small Chancellor of the Exchequer, for a reduction of the duty on tea.

Question put, "That the word 'eight-pence' stand part of the Resolution."

The House divided: Ayes, 257; Noes, 179.

Division No. 103.]AYES.[6.10 p.m.
Agg-Gardner, Sir James TynteCockerill, Brigadier-General G. K.Henn, Sir Sydney H.
Ainsworth, Captain CharlesCohen, Major J. Brune[...]Hennessy, Major J. R. G.
Alexander, E. E. (Leyton, East)Colfox, Major Wm. PhillipsHerbert, Dennis (Hertford, Watford)
Amery, Rt. Hon. Leopold C. M. S.Cope, Major WilliamHerbert, S. (Scarborough)
Apsley, LordCory, Sir J. H. (Cardiff, South)Hewett, Sir J. P.
Archer-Shee, Lieut.-Colonel MartinCourthope, Lieut.-Col. George L.Hilder, Lieut.-Colonel Frank
Ashley, Lt.-Col. Wilfrid W.Craig, Captain C. C. (Antrim, South)Hiley, Sir Ernest
Astbury, Lieut.-Com. Frederick W.Craik, Rt. Hon. Sir HenryHoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Astor, J. J. (Kent, Dover)Croft, Lieut.-Colonel Henry PageHogg, Rt. Hon. Sir D. (St. Marylebone)
Baird, Rt. Hon. Sir John LawrenceCrook, C. W. (East Ham, North)Hood, Sir Joseph
Baldwin, Rt. Hon. StanleyCurzon, Captain ViscountHopkins, John W. W.
Balfour, George (Hampstead)Dalziel, Sir D. (Lambeth, Brixton)Hopkinson, A. (Lancaster, Mossley)
Banks, MitchellDavidson, J. C. C. (Hemel Hempstead)Howard, Capt. D. (Cumberland, N.)
Barlow, Rt. Hon. Sir MontagueDavidson, Major-General Sir J. H.Hudson, Capt. A.
Barnett, Major Richard W.Davison, Sir W. H. (Kensington, S.)Hughes, Collingwood
Barnston, Major HarryDawson, Sir PhilipHume-Williams, Sir W. Ellis
Bell, Lieut.-Col. W. C. H. (Devizes)Dixon, C. H. (Rutland)Hurst, Lieut.-Colonel Gerald B.
Bellairs, Commander Carlyon W.Doyle, N. GrattanHutchison, G. A. C. (Midlothian, N.)
Benn, Sir A. S. (Plymouth, Drake)Du Pre, Colonel William BaringHutchison, W. (Kelvingrove)
Bennett, Sir T. J. (Sevenoaks)Edmondson, Major A. J.Inskip, Sir Thomas Walker H.
Bentinck, Lord Henry Cavendish-Elliot, Capt. Walter E. (Lanark)Jackson, Lieut.-Colonel Hon. F. S.
Berry, Sir GeorgeEllis, R. G.James, Lieut.-Colonel Hon. Cuthbert
Betterton, Henry B.Erskine, James Malcolm MonteithJephcott, A. R.
Blades, Sir George RowlandErskine, Lord (Weston-super-Mare)Jodrell, Sir Neville Paul
Blundell, F. N.Erskine-Bolst, Captain C.Joynson-Hicks, Sir William
Bowyer, Capt. G. E. W.Eyres-Monsell, Com. Bolton M.Kennedy, Captain M. S. Nigel
Boyd-Carpenter, Major A.Falcon, Captain MichaelKing, Captain Henry Douglas
Brass, Captain W.Falle, Major Sir Bertram GodfrayKinloch-Cooke, Sir Clement
Brassey, Sir LeonardFawkes, Major F. H.Lane-Fox, Lieut.-Colonel G. R.
Bridgeman, Rt. Hon. William CliveFermor-Hesketh, Major T.Law, Rt. Hon. A. B. (Glasgow, C.)
Briggs, HaroldFord, Patrick JohnstonLloyd, Cyril E. (Dudley)
Brown, Major D. C. (Hexham)Foreman, Sir HenryLocker-Lampson, G. (Wood Green)
Brown, Brig.-Gen. Clifton (Newbury)Forestier-Walker, L.Lorimer, H. D.
Bruton, Sir JamesFrece, Sir Walter deLowe, Sir Francis William
Buckingham, Sir H.Fremantle, Lieut.-Colonel Francis E.Loyd, Arthur Thomas (Abingdon)
Buckley, Lieut.-Colonel A.Furness, G. J.Lumley, L. R.
Bull, Rt. Hon. Sir William JamesGanzoni, Sir JohnMacnaghten, Hon. Sir Malcolm
Burn, Colonel Sir Charles RosdewGates, PercyMcNeill, Ronald (Kent, Canterbury)
Burney, Com. (Middx., Uxbridge)Gaunt, Rear-Admiral Sir Guy R.Maitland, Sir Arthur D. Steel-
Butcher, Sir John GeorgeGoff, Sir R. ParkMalone, Major P. B. (Tottenham, S.)
Butler, H. M. (Leeds, North)Gould, James C.Manville, Edward
Butt, Sir AlfredGray, Harold (Cambridge)Margesson, H. D. R.
Button, H. S.Greene, Lt.-Col. Sir W. (Hack'y, N.)Mason, Lieut.-Col- C. K.
Cadogan, Major EdwardGrenfell, Edward C. (City of London)Mercer, Colonel H.
Campton, Lieut.-Colonel W. R.Guinness, Lieut.-Col. Hon. W. E.Milne, J. S. Wardlaw
Cassels, J. D.Gwynne, Rupert S.Mitchell, W. F. (Saffron Walden)
Cayzer, Sir C. (Chester, City)Hacking, Captain Douglas H.Mitchell, Sir W. Lane (Streatham)
Cecil, Rt. Hon. Sir Evelyn (Aston)Halstead, Major D.Molson, Major John Elsdale
Cecil, Rt. Hon. Lord H. (Ox. Univ.)Hamilton, Sir George C. (Altrincham)Moore, Major-General Sir Newton J.
Chamberlain, Rt. Hon. N. (Ladywood)Hannon, Patrick Joseph HenryMorden, Col. W. Grant
Chapman, Sir S.Harmsworth, Hon. E. C. (Kent)Morrison, Hugh (Wilts, Salisbury)
Churchman, Sir ArthurHarrison, F. C.Murchison, C. K.
Clarry, Reginald GeorgeHarvey, Major S. E.Nesbitt, Robert C.
Clayton, G. C.Hawke, John AnthonyNewman, Colonel J. R. P. (Finchley)
Cobb, Sir CyrilHay, Major T. W. (Norfolk, South)Newman, Sir R. H. S. D. L. (Exeter)
Newson, Sir Percy WilsonRichardson, Sir Alex. (Gravesend)Terrell, Captain R. (Oxford, Henley)
Newton, Sir D. G. C. (Cambridge)Richardson, Lt.-Col. Sir P. (Chertsey)Thompson, Luke (Sunderland)
Nicholson, Brig.-Gen. J. (Westminster)Roberts, Rt. Hon. G. H. (Norwich)Thomson, F. C. (Aberdeen, South)
Nicholson, William G. (Petersfield)Roberts, Samuel (Hereford, Hereford)Thorpe, Captain John Henry
Norton-Griffiths, Lieut.-Col. Sir JohnRoberts, Rt. Hon. Sir S. (Ecclesall)Titchfield, Marquess of
Oman, Sir Charles William C.Robertson-Despencer, Major (Isl'gt'nW.)Tryon, Rt. Hon. George Clement
Ormsby-Gore, Hon. WilliamRoundell, Colonel R. F.Tubbs, S. W.
Paget, T. G.Ruggles-Brise, Major E.Turton, Edmund Russborough
Parker, Owen (Kettering)Russell, Alexander West (Tynemouth)Vaughan-Morgan, Col. K. P.
Pease, William EdwinRussell, William (Bolton)Wallace, Captain E.
Ponnefather, De FonblanqueRussell-Wells, Sir SydneyWard, Col. L. (Kingston-upon-Hull)
Penny, Frederick GeorgeSamuel, A. M. (Surrey, Farnham)Waring, Major Walter
Percy, Lord Eustace (Hastings)Sanders, Rt. Hon. Sir Robert A.Watson, Capt. J. (Stockton-on-Tees)
Perkins, Colonel E. K.Sanderson, Sir Frank B.Watts, Dr. T. (Man., Withington)
Perring, William GeorgeSandon, LordWells, S. R.
Peto, Basil E.Sassoon, Sir Philip Albert Gustave D.Weston, Colonel John Wakefield
Pielou, D. P.Sheffield, Sir BerkeleyWheler, Col. Granville C. H.
Pilditch, Sir PhilipShepperson, E. W.White, Col. G. D. (Southport)
Pollock, Rt. Hon. Sir Ernest MurrayShipwright, Captain D.Wilson, Col. M. J. (Richmond)
Pownall, Lieut.-Colonel AsshetonSimms, Dr. John M. (Co. Down)Winterton, Earl
Pretyman, Rt. Hon. Ernest G.Simpson-Hinchcliffe, W. A.Wise, Frederick
Privett, F. J.Skelton, A. N.Wolmer, Viscount
Raeburn, Sir William H.Somerville, A. A. (Windsor)Wood, Sir H. K. (Woolwich, West)
Raine, W.Somerville, Daniel (Barrow-in-Furn'ss)Wood, Major Sir S. Hill- (High Peak)
Rankin, Captain James StuartSparkes, H. W.Woodcock, Colonel H. C.
Rawlinson, Rt. Hon. John Fredk. PeelSpender-Clay, Lieut.-Colonel H. H.Worthington-Evans, Rt. Hon. Sir L.
Rawson, Lieut.-Com. A. C.Stanley, LordYate, Colonel Sir Charles Edward
Reid, Capt. A. S. C. (Warrington)Steel, Major S. StrangYerburgh, R. D. T.
Reid, D. D. (County Down)Stewart, Gershom (Wirral)
Rentoul, G. S.Stott, Lt.-Col. W. H.TELLERS FOR THE AYES.—
Reynolds, W. G. W.Sueter, Rear-Admiral Murray FraserColonel Leslie Wilson and Colonel
Rhodes, Lieut.-Col. J. P.Sykes, Major-Gen. Sir Frederick H.Gibbs.
NOES.
Adamson, W. M. (Staff., Cannock)Gilbert, James DanielLowth, T.
Adkins, Sir William Ryland DentGosling, HarryLunn, William
Alexander, Col. M. (Southwark)Graham, W. (Edinburgh, Central)MacDonald, J. R. (Aberavon)
Alexander, A. V. (Sheffield, Hillsbro')Gray, Frank (Oxford)Macdonald, Sir Murdoch (Inverness)
Ammon, Charles GeorgeGreenall, T.McLaren, Andrew
Asquith, Rt. Hon. Herbert HenryGreenwood, A. (Nelson and Colne)Macnamara, Rt. Hon. Dr. T. J.
Attlee, C. R.Grenfell, D. R. (Glamorgan)Macpherson, Rt. Hon. James I.
Barker, G. (Monmouth, Abertillery)Griffiths, T. (Monmouth, Pontypool)March, S.
Barnes, A.Groves, T.Maxton, James
Batey, JosephGrundy, T. W.Middleton, G.
Benn, Captain Wedgwood (Leith)Guest, Hon. C. H. (Bristol, N.)Morel, E. D.
Berkeley, Captain ReginaldGuest, J. (York, Hemsworth)Morrison, R. C. (Tottenham, N.)
Bonwick, A.Guthrie, Thomas MauleMosley, Oswald
Briant, FrankHall, F. (York, W. R., Normanton)Muir, John W.
Broad, F. A.Hamilton, Sir R. (Orkney & Shetland)Murray, Hon. A. C. (Aberdeen)
Bromfield, WilliamHarbord, ArthurMurray, R. (Renfrew, Western)
Brotherton, J.Harris, Percy A.Newbold, J. T. W.
Buchanan, G.Hastings, PatrickO'Connor, Thomas P.
Buckie, J.Hayes, John Henry (Edge Hill)O'Grady, Captain James
Burgess, S.Hemmerde, E. G.Oliver, George Harold
Burnie, Major J. (Bootle)Henderson, Rt. Hon. A. (N'castle, E.)Paling, W.
Buxton, Charles (Accrington)Henderson, Sir T. (Roxburgh)Parkinson, John Allen (Wigan)
Buxton, Noel (Norfolk, North)Henderson, T. (Glasgow)Philipson, Hilton
Cairns, JohnHerriotts, J.Ponsonby, Arthur
Chapple, W. A.Hill, A.Potts, John S.
Charleton, H. C.Hirst, G. H.Price, E. G.
Clarke, Sir E. C.Hogge, James MylesPringle, W. M. R.
Clynes, Rt. Hon. John R.Irving, DanRees, Sir Beddoe
Collins, Sir Godfrey (Greenock)Jarrett, G. W. S.Richards, R.
Collison, LeviJenkins, W. A. (Brecon and Radnor)Richardson, R. (Houghton-le-Spring)
Cotts, Sir William Dingwall MitchellJohn, William (Rhondda, West)Riley, Ben
Cowan, D. M. (Scottish Universities)Johnston, Thomas (Stirling)Ritson, J.
Darbishire, C. W.Johnstone, Harcourt (Willesden, East)Roberts, C. H. (Derby)
Davies, Rhys John (Westhoughton)Jones, Henry Haydn (Merioneth)Robinson, W. C. (York, Elland)
Davison, J. E. (Smethwick)Jones, Morgan (Caerphilly)Rose, Frank H.
Dudgeon, Major C. R.Jones, R. T. (Carnarvon)Royce, William Stapleton
Duffy, T. GavanJones, T. I. Mardy (Pontypridd)Saklatvala, S.
Duncan, C.Jowett, F. W. (Bradford, East)Salter, Dr. A.
Ede, James ChuterJowitt, W. A. (The Hartlepools)Scrymgeour, E.
Edge, Captain Sir WilliamKelley, Major Fred (Rotherham)Shakespeare, G. H.
Edmonds, G.Kenworthy, Lieut.-Commander J. M.Shaw, Thomas (Preston)
Emlyn-Jones, J. E. (Dorset, N.)Kenyon, BarnetShort, Alfred (Wednesbury)
Entwistle, Major C. F.Kirkwood, D.Simon, Rt. Hon. Sir John
Evans, Ernest (Cardigan)Lansbury, GeorgeSimpson, J. Hope
Fairbairn, R. R.Lawson, John JamesSinclair, Sir A.
Falconer, J.Leach, W.Smith, T. (Pontefract)
Foot, IsaacLee, F.Snell, Harry
George, Rt. Hon. David LloydLees-Smith, H. B. (Keighley)Snowden, Philip
George, Major G. L. (Pembroke)Linfield, F. C.Spencer, George A. (Broxtowe)
Stephen, CampbellWatts-Morgan, Lt.-Col. D. (Rhondda)Williams, T. (York, Don Valley)
Stewart, J. (St. Rollox)Webb, SidneyWilson, C. H. (Sheffield, Attercliffe)
Strauss, Edward AnthonyWedgwood, Colonel Josiah C.Wilson, R. J. (Jarrow)
Sturrock, J. LengWeir, L. M.Winfrey, Sir Richard
Thorne, G. R. (Wolverhampton, E.)Welsh, J. C.Wintringham, Margaret
Thorne, W. (West Ham, Plaistow)Westwood, J.Wood, Major M. M. (Aberdeen, C.)
Thornton, M.White, Charles F. (Derby, Western)Wright, W.
Trevelyan, C. P.White, H. G. (Birkenhead, E.)Young, Rt. Hon. E. H. (Norwich)
Turner, BenWhiteley, W.Young, Robert (Lancaster, Newton)
Wallhead, Richard C.Williams, David (Swansea, E.)
Warne, G. H.Williams, Dr. J. H. (Llanelly)TELLERS FOR THE NOES.—
Mr. Phillips and Sir A. Marshall.

Motion made, and Question put, "That this House doth agree with the Committee in the said Resolution."

The House divided: Ayes, 260; Noes, 182.

Division No. 104.]AYES.[6.20 p.m.
Agg-Gardner, Sir James TynteCrook, C. W. (East Ham, North)Hutchison, G. A. C. (Midlothian, N.)
Ainsworth, Captain CharlesCurzon, Captain ViscountHutchison, W. (Kelvingrove)
Alexander, E. E. (Leyton, East)Dalziel, Sir D. (Lambeth, Brixton)Inskip, Sir Thomas Walker H.
Amery, Rt. Hon. Leopold C. M. S.Davidson, J. C. C. (Hemel Hempstead)Jackson, Lieut.-Colonel Hon. F. S.
Apsley, LordDavidson, Major-General Sir J. H.James, Lieut.-Colonel Hon. Cuthbert
Archer-Shee, Lieut.-Colonel MartinDavison, Sir W. H. (Kensington, S.)Jephcott, A. R.
Ashley, Lt.-Col. Wilfrid W.Dawson, Sir PhilipJodrell, Sir Neville Paul
Astbury, Lieut.-Com. Frederick W.Dixon, C. H. (Rutland)Jones, G. W. H. (Stoke Newington)
Astor, J. J. (Kent, Dover)Doyle, N. GrattanJoynson-Hicks, Sir William
Baird, Rt. Hon. Sir John LawrenceDu Pre, Colonel William BaringKennedy, Captain M. S. Nigel
Baldwin, Rt. Hon. StanleyEdmondson, Major A. J.King, Captain Henry Douglas
Balfour, George (Hampstead)Elliot, Capt. Walter E. (Lanark)Kinloch-Cooke, Sir Clement
Banks, MitchellEllis, R. G.Lane-Fox, Lieut.-Colonel G. R.
Barlow, Rt. Hon. Sir MontagueErskine, James Malcolm MonteithLaw, Rt. Hon. A. B. (Glasgow, C.)
Barnett, Major Richard W.Erskine, Lord (Weston-super-Mare)Lloyd, Cyril E. (Dudley)
Barnston, Major HarryErskine-Bolst, Captain C.Lorimer, H. D.
Bell, Lieut.-Col. W. C. H. (Devizes)Eyres-Monsell, Com. Bolton M.Lowe, Sir Francis William
Bellairs, Commander Carlyon W.Falcon, Captain MichaelLoyd, Arthur Thomas (Abingdon)
Benn, Sir A. S. (Plymouth, Drake)Falle, Major Sir Bertram GodfrayLumley, L. R.
Bennett, Sir T. J. (Sevenoaks)Fawkes, Major F. H.Macnaghten, Hon. Sir Malcolm
Berry, Sir GeorgeFermor-Hesketh, Major T.McNeill, Ronald (Kent, Canterbury)
Betterton, Henry B.Ford, Patrick JohnstonMaitland, Sir Arthur D. Steel-
Birchall, Major J. DearmanForeman, Sir HenryMalone, Major P. B. (Tottenham, S.)
Blades, Sir George RowlandForestier-Walker, L.Manville, Edward
Blundell, F. N.Foxcroft, Captain Charles TalbotMargesson, H. D. R.
Bowyer, Capt. G. E. W.Frece, Sir Walter deMason, Lieut.-Col. C. K.
Boyd-Carpenter, Major A.Fremantle, Lieut.-Colonel Francis E.Mercer, Colonel H.
Brass, Captain W.Furness, G. J.Milne, J. S. Wardlaw
Brassey, Sir LeonardGanzoni, Sir JohnMitchell, W. F. (Saffron Walden)
Bridgeman, Rt. Hon. William CliveGates, PercyMitchell, Sir W. Lane (Streatham)
Briggs, HaroldGaunt, Rear-Admiral Sir Guy R.Molson, Major John Elsdale
Brown, Major D. C. (Hexham)Goff, Sir R. ParkMoore, Major-General Sir Newton J.
Brown, Brig.-Gen. Clifton (Newbury)Gould, James C.Morden, Col. W. Grant
Bruton, Sir JamesGray, Harold (Cambridge)Morrison, Hugh (Wilts, Salisbury)
Buckingham, Sir H.Greene, Lt.-Col. Sir W. (Hack'y, N.)Murchison, C. K.
Buckley, Lieut.-Colonel A.Grenfell, Edward C. (City of London)Nesbitt, Robert C.
Bull, Rt. Hon. Sir William JamesGuinness, Lieut.-Col. Hon. W. E.Newman, Colonel J. R. P. (Finchley)
Burn, Colonel Sir Charles RosdewGwynne, Rupert S.Newman, Sir R. H. S. D. L. (Exeter)
Burney, Com. (Middx., Uxbridge)Hacking, Captain Douglas H.Newson, Sir Percy Wilson
Butcher, Sir John GeorgeHalstead, Major D.Newton, Sir D. G. C. (Cambridge)
Butler, H. M. (Leeds, North)Hamilton, Sir George C. (Altrincham)Nicholson, Brig.-Gen. J. (Westminster)
Butt, Sir AlfredHannon, Patrick Joseph HenryNicholson, William G. (Petersfield)
Button, H. S.Harmsworth, Hon. E. C. (Kent)Nield, Sir Herbert
Cadogan, Major EdwardHarrison, F. C.Norton-Griffiths, Lieut.-Col. Sir John
Campion, Lieut.-Colonel W. R.Harvey, Major S. E.Oman, Sir Charles William C.
Cassels, J. D.Hawke, John AnthonyOrmsby-Gore, Hon. William
Cayzer, Sir C. (Chester, City)Hay, Major T. W. (Norfolk, South)Paget, T. G.
Cecil, Rt. Hon. Sir Evelyn (Aston)Henn, Sir Sydney H.Parker, Owen (Kettering)
Cecil, Rt. Hon. Lord H. (Ox. Univ.)Hennessy, Major J. R. G.Pease, William Edwin
Chamberlain, Rt. Hon. N. (Ladywood)Herbert, Dennis (Hertford, Watford)Pennefather, De Fonblanque
Chapman, Sir S.Herbert, S. (Scarborough)Penny, Frederick George
Churchman, Sir ArthurHewett, Sir J. P.Percy, Lord Eustace (Hastings)
Clarry, Reginald GeorgeHilder, Lieut.-Colonel FrankPerkins, Colonel E. K.
Clayton, G. C.Hiley, Sir ErnestPerring, William George
Cobb, Sir CyrilHoare, Lt.-Col. Rt. Hon. Sir S. J. G.Peto, Basil E.
Cockerill, Brigadier-General G. K.Hogg, Rt. Hon. Sir D. (St. Marylebone)Pielou, D. P.
Cohen, Major J. Brune[...]Hood, Sir JosephPilditch, Sir Philip
Colfox, Major Wm. PhillipsHopkins, John W. W.Pollock, Rt. Hon. Sir Ernest Murray
Cope, Major WilliamHopkinson, A. (Lancaster, Mossley)Pewnall, Lieut.-Colonel Assheton
Cory, Sir J. H. (Cardiff, South)Howard, Capt. D. (Cumberland, N.)Pretyman, Rt. Hon. Ernest G.
Courthope, Lieut.-Col. George L.Hudson, Capt. A.Privett, F. J.
Craig, Captain C. C. (Antrim, South)Hughes, CollingwoodRaeburn, Sir William H.
Craik, Rt. Hon. Sir HenryHume-Williams, Sir W. EllisRaine, W.
Croft, Lieut.-Colonel Henry PageHurst, Lt.-Col. Gerald BerkeleyRankin, Captain James Stuart
Rawlinson, Rt. Hon. John Fredk. PeelSheffield, Sir BerkeleyVaughan-Morgan, Col. K. P.
Rawson, Lieut.-Com. A. C.Shepperson, E. W.Wallace, Captain E.
Reid, Capt. A. S. C. (Warrington)Shipwright, Captain D.Ward, Col. L. (Kingston-upon-Hull)
Reid, D. D. (County Down)Simms, Dr. John M. (Co. Down)Waring, Major Walter
Rentoul, G. S.Simpson-Hinchcliffe, W. A.Watson, Capt. J. (Stockton-on-Tees)
Reynolds, W. G. W.Skelton, A. N.Watts, Dr. T. (Man., Withington)
Rhodes, Lieut.-Col. J. P.Somerville, A. A. (Windsor)Wells, S. R.
Richardson, Sir Alex. (Gravesend)Somerville, Daniel (Barrow-in-Furn'ss)Western, Colonel John Wakefield
Richardson, Lt.-Col. Sir P. (Chertsey)Sparkes, H. W.Wheler, Col. Granville C. H.
Roberts, Rt. Hon. G. H. (Norwich)Spender-Clay, Lieut.-Colonel H. H.White, Col. G. D. (Southport)
Roberts, Samuel (Hereford, Hereford)Stanley, LordWilson, Col. M. J. (Richmond)
Roberts, Rt. Hon. Sir S. (Ecclesall)Steel, Major S. StrangWinterton, Earl
Robertson-Despencer, Major (Isl'gt'n W.)Stewart, Gershom (Wirral)Wise, Frederick
Roundell, Colonel R. F.Stott, Lt.-Col. W. H.Wolmer, Viscount
Ruggles-Brise, Major E.Sueter, Rear-Admiral Murray FraserWood, Sir H. K. (Woolwich, West)
Russell, Alexander West (Tynemouth)Sykes, Major-Gen. Sir Frederick H.Wood, Major Sir S. Hill- (High Peak)
Russell, William (Bolton)Terrell, Captain R. (Oxford, Henley)Woodcock, Colonel H. C.
Russell-Wells, Sir SydneyThompson, Luke (Sunderland)Worthington-Evans, Rt. Hon. Sir L.
Samuel, A. M. (Surrey, Farnham)Thomson, F. C. (Aberdeen, South)Yate, Colonel Sir Charles Edward
Samuel, Samuel (W'dsworth, Putney)Thorpe, Captain John HenryYerburgh, R. D. T.
Sanders, Rt. Hon. Sir Robert A.Titchfield, Marquess of
Sanderson, Sir Frank B.Tryon, Rt. Hon. George ClementTELLERS FOR THE AYES.—
Sandon, LordTubbs, S. W.Colonel Leslie Wilson and Colonel
Sassoon, Sir Philip Albert Gustave D.Turton, Edmund RussboroughGibbs.
NOES.
Adamson, W. M. (Staff., Cannock)Groves, T.Murray, Hon. A. C. (Aberdeen)
Adkins, Sir William Ryland DentGrundy, T. W.Murray, R. (Renfrew, Western)
Alexander, Col. M. (Southwark)Guest, Hon. C. H. (Bristol, N.)Newbold, J. T. W.
Alexander, A. V. (Sheffield, Hillsbro')Guest, J. (York, Hemsworth)O'Connor, Thomas P.
Ammon, Charles GeorgeGuthrie, Thomas MauleO'Grady, Captain James
Asquith, Rt. Hon. Herbert HenryHall, F. (York, W. R., Normanton)Oliver, George Harold
Attlee, C. R.Hamilton, Sir R. (Orkney & Shetland)Paling, W.
Barker, G. (Monmouth, Abertillery)Harbord, ArthurParkinson, John Allen (Wigan)
Barnes, A.Harney, E. A.Phillipps, Vivian
Batey, JosephHarris, Percy A.Philipson, Hilton
Benn, Captain Wedgwood (Leith)Hastings, PatrickPonsonby, Arthur
Berkeley, Captain ReginaldHayday, ArthurPotts, John S.
Bonwick, A.Hayes, John Henry (Edge Hill)Pringle, W. M. R.
Briant, FrankHemmerde, E. G.Rees, Sir Beddoe
Broad, F. A.Henderson, Rt. Hon. A. (N'castle, E.)Richards, R.
Bromfield, WilliamHenderson, Sir T. (Roxburgh)Richardson, R. (Houghton-le-Spring)
Brotherton, J.Henderson, T. (Glasgow)Riley, Ben
Buchanan, G.Herriotts, J.Ritson, J.
Buck[...]e, J.Hill, A.Roberts, C. H. (Derby)
Burgess, S.Hirst, G. H.Robinson, W. C. (York, Elland)
Burnie, Major J. (Bootle)Hogge, James MylesRose, Frank H.
Butler, J. R. M. (Cambridge Univ.)Irving, DanRoyce, William Stapleton
Buxton, Charles (Accrington)Jarrett, G. W. S.Saklatvala, S.
Buxton, Noel (Norfolk, North)Jenkins, W. A. (Brecon and Radnor)Salter, Dr. A.
Cairns, JohnJohn, William (Rhondda, West)Scrymgeour, E.
Chapple, W. A.Johnston, Thomas (Stirling)Sexton, James
Charleton, H. C.Johnstone, Harcourt (Willesden, East)Shakespeare, G. H.
Clarke, Sir E. C.Jones, Henry Haydn (Merioneth)Shaw, Thomas (Preston)
Clynes, Rt. Hon. John R.Jones, Morgan (Caerphilly)Short, Alfred (Wednesbury)
Collins, Sir Godfrey (Greenock)Jones, R. T. (Carnarvon)Simon, Rt. Hon. Sir John
Collison, LeviJones, T. I. Mardy (Pontypridd)Simpson, J, Hope
Cotts, Sir William Dingwall MitchellJowett, F. W. (Bradford, East)Sinclair, Sir A.
Cowan, D. M. (Scottish Universities)Jowitt, W. A. (The Hartlepools)Smith, T. (Pontefract)
Darbishire, C. W.Kenworthy, Lieut.-Commander J. M.Snell, Harry
Davison, J. E. (Smethwick)Kenyon, BarnetSnowden, Philip
Dudgeon, Major C. R.Kirkwood, D.Spencer, George A. (Broxtowe)
Duffy, T. GavanLansbury, GeorgeStephenson, Lieut.-Colonel H. K.
Duncan, C.Lawson, John JamesStephen, Campbell
Dunnico, H.Leach, W.Stewart, J. (St. Rollox)
Ede, James ChuterLee, F.Strauss, Edward Anthony
Edge, Captain Sir WilliamLees-Smith, H. B. (Keighley)Sturrock, J. Leng
Edmonds, G.Linfield, F. C.Thorne, G. R. (Wolverhampton, E.)
Emlyn-Jones, J. E. (Dorset, N.)Lowth, T.Thorne, W. (West Ham, Plaistow)
Entwistle, Major C. F.MacDonald, J. R. (Aberavon)Thornton, M.
Evans, Ernest (Cardigan)Macdonald, Sir Murdoch (Inverness)Trevelyan, C. P.
Fairbairn, R. R.McLaren, AndrewTurner, Ben
Falconer, J.Macnamara, Rt. Hon. Dr. T. J.Wallhead, Richard C.
Foot, IsaacMacpherson, Rt. Hon. James I.Warne, G. H.
George, Rt. Hon. David LloydMarch, S.Watts-Morgan, Lt.-Col. D. (Rhondda)
George, Major G. L. (Pembroke)Marshall, Sir Arthur H.Webb, Sidney
Gilbert, James DanielMaxton, JamesWedgwood, Colonel Josiah C.
Gosling, HarryMiddleton, G.Weir, L. M.
Graham, W. (Edinburgh, Central)Moreing, Captain Algernon H.Welsh, J. C.
Gray, Frank (Oxford)Morel, E. D.Westwood, J.
Greenall, T.Morrison, R. C. (Tottenham, N.)White, Charles F. (Derby, Western)
Greenwood, A. (Nelson and Colne)Mosley, OswaldWhite, H. G. (Birkenhead, E.)
Grenfell, D. R. (Glamorgan)Muir, John W.Whiteley, W.
Williams, David (Swansea, E.)Winfrey, Sir RichardYoung, Robert (Lancaster, Newton)
Williams, Dr. J. H. (Llanelly)Wintringham, Margaret
Williams, T. (York, Don Valley)Wood, Major M. M. (Aberdeen, C.)TELLERS FOR THE NOES.—
Wilson, C. H. (Sheffield, Attercliffe)Wright, W.Mr. T. Griffiths and Mr. Lunn.
Wilson, R. J. (Jarrow)Young, Rt. Hon. E. H. (Norwich)

Second Resolution read a Second time.

Colonel GUEST:

I beg to move to leave out the words "one pound," and to insert instead thereof the words "sixteen shillings."

While I am in favour of beer being made available to the community at the cheapest possible price, I do not see why this remission in the price of beer should be so largely borne by the State. A much larger contribution towards the remission should be made by the trade. I would have preferred that the reduction in duty had been made on tea or sugar. With regard to sugar, I agree with the facts which the Chancellor of the Exchequer brought forward in his Budget statement, and the House has now negatived a reduction in the Tea Duty. The saving that would be effected to the State by my Amendment and the additional money that would be obtained from the brewing trade would be sufficient to enable the Government to make a reduction in the Tea Duty. I should like to know how the Chancellor of the Exchequer has arrived at the proportion of contribution in making his arrangement with the trade. Did he estimate the proportion of the contribution which the trade should bear, or has the matter been a subject of long conference with the trade as to how much they would surrender of the profits of their trade? I presume that in any conferences or negotiations the brewing trade would put its best case forward, and that it has tried to come to an arrangement with the Treasury at the least possible cost to itself; that is only human for any trade to do. A great many of us are disappointed, because, in the Press forecasts which preceded the financial statement made by the Chancellor of the Exchequer, we were led to believe that there was going to be a much heavier contribution by the trade.

The cost to the State of the proposed rebate is estimated by the Chancellor of the Exchequer at £16,000,000 in a full year. If the proportions were altered in the terms of my Amendment, there would be a saving to the State of £3,500,000. That saving could have been far better employed in the reduction of other duties. Has the Treasury made a good bargain with the trade? I have looked up the returns of dividend paid by some of the big brewery companies, and, in spite of years of bad trade and in spite of shortage of wages payable to the men due to bad trade, I find that the profits of these businesses have been colossal, and they could certainly bear the £3,500,000 which the Treasury proposes to bear and which I now propose to place upon the trade. I do not want to mention individual businesses, but it is very easy for hon. Members to look up the Stock Exchange list and see exactly what the companies have paid in the last few years. One company has paid 26 per cent. on the average in the last five years, and in addition they have been able to issue a bonus of 50 per cent. of common stock to the whole of their shareholders. [HON. MEMBERS: "Name!"] I will give the name privately, or if hon. Members desire I will give it now. [HON. MEMBERS: "Name!"] It is the Guinness business. Let me mention another company which paid 24 per cent. on the average for the last five years and issued a bonus of 100 per cent. of common stock. Another business paid 10 per cent. on the average for the last five years and issued 150 per cent. of common stock as bonus. Another business has paid 25 per cent. on the average for the last five years.

The question is, has the Chancellor of the Exchequer made a good bargain with the trade? Cannot the trade afford to carry a much bigger contribution of this remission than they have agreed to do? I am not in any way attacking the brewing trade. It is an important industry, but it is not a trade that deserves special consideration on the part of the State. It is not one of our big basic industries. You cannot compare it with the iron trade, the coal trade, the cotton trade, or the woollen trade, because it is not a big employer of labour like those great trades. The trade could have borne a much bigger share of the reduction of the duty. It seems to me that the trade has taken a very short-sighted view of the situation. Generally, as the Chancellor of the Exchequer has informed us in his Budget statement, trade is increasing and more wages are available to be spent by the wage earner. This will mean greater expenditure and greater sales in the brewing trade and, consequently, increased profits. I should like to know whether these factors of the greatly improving trade were taken into consideration by the Chancellor of the Exchequer when he struck the balance of 20s. to be borne by the State and 4s. to be borne by the trade. The profits made by these great brewing companies are ample justification for my contention that the State should not contribute so much of the rebate, but that they should hold the trade to its arrangement that the price of beer should be reduced, and it could be so reduced by virtue of the profits made in this great industry, while at the same time the trade could bear a larger share of the cost of the rebate.

Photo of Captain Algernon Moreing Captain Algernon Moreing , Buckrose

I beg to second the Amendment.

I would remind the Financial Secretary to the Treasury that if our proposals are adopted he will secure approximately £3,500,000 towards the £3,900,000 which he requires for the reduction of the Tea Duty. Presumably, the object of lowering the Beer Duty is to reduce the cost of beer to the consumer. It cannot be said that the taxation which has been in force has in any way affected the prosperity or the profits of the brewing trade. Therefore, if it be the primary object of the rebate to secure a reduction of cost to the consumer, the brewing trade could be well asked to bear a greater proportion of the cost of the reduction than it is being asked to do. The Chancellor of the Exchequer calculates that the cost of this concession in a full year would be £20,000,000, of which he proposes that £16,600,000 should be borne by the State and that the balance should be contributed by the trade.

In 1913, the profits of the brewing trade were reckoned at approximately £9,970,000, and in 1921–22 at £17,550,000. If the whole amount that we are now proposing should be borne by the trade and come out of their profits, they would still be left with profits of, approximately, £14,500,000, or over £4,000,000 more than in the year 1913. If our proposal were adopted, the Exchequer would have to find £13,300,000 and the brewers, approximately, £7,000,000. If we assume that the whole of this amount of £7,000,000 came out of the brewers' profits, their profits would be reduced to something like £10,850,000, or nearly £1,000,000 more than in 1913, so that even on the basis of the present sales and present profits it would be fair, considering the burdens of taxation which have been borne by other industries, to ask this trade to make a larger contribution towards the cost of the proposed reduction. When the duty was raised from 70s. to 100s. per standard barrel, immediately, under the food orders, an extra 1d. per pint was put upon beer, and I do not see why when the reduction has taken place and that 1d. has been taken off the taxpayer should shoulder so much of the burden.

If we examine the matter a little further, we are forced to the conclusion that it is by no means certain that the whole of this sum would come out of the profits of the brewers. For a considerable time the reduction of the Beer Duty has been urged in interested quarters. It has been pointed out that the price of beer is a very great hardship to the working man, that it has caused a considerable amount of discontent, and a reduction of the duty has been urged on these grounds. Surely, when parties interested in any trade ask for a reduction of a tax, they do so primarily because they expect to get larger profits and a better turnover. The brewing trade hope as the result of a reduction of 1d. per pint that there will be a considerable expansion in their business.

Photo of Captain Algernon Moreing Captain Algernon Moreing , Buckrose

Then what is the point of asking for a reduction of tax? But if they do get an expansion of trade, then automatically the cost of the barrel will come down through the reduction of the overhead charges of the brewing industry. Increased output always means lower cost per unit. Everything seems to point in the direction of mineral trade. There has been a great revival in the iron trade of this country, which is one of the principal consumers of beer. Therefore my hon. and gallant friend can look forward to a great expansion in the brewing trade in the coming 12 months. The brewing trade, in spite of the high taxation, has been extremely profitable, and it is reasonable to ask it to contribute something more towards the burden of taxation, which is falling so heavily upon some of the trades which have not had the same opportunity to put their financial house in order as the brewing trade. If my right hon. Friend will adopt our proposals, this will give him a sum of £3,300,000 approximately, which can be devoted to a reduction in the tax on other trades which have not prospered during the last three years as the brewing trade has done.

Photo of Mr Henry Croft Mr Henry Croft , Bournemouth

There is grave misapprehension on the subject of the profits of the brewing industry. My hon. and gallant Friend (Captain Moreing) seemed to think that there was a great demand from the brewing industry for a reduction of taxation which would amount to a 1d. a pint. Though I am not a brewer myself, I believe that there has been no demand for such a reduction. The trade would have been very grateful for a reduction to the extent of 2d. per pint, as that would have led to a very considerable expansion of business, but I do not think that there is going to be any great increase in trade owing to the reduction of 1d., and therefore I do not think that there is going to be any great increase in the amount consumed, from which a higher revenue would be produced.

The hon. and gallant Gentleman who moved the Amendment (Colonel Guest) quoted a few cases. The first is that of a brewery, the revenue of which, I am sorry to say, has been lost to this country, as the brewery is in the Irish Free State, and therefore this provision does not apply to it, but my hon. and gallant Friend will realise that the conditions of this brewery are very different from those of the average brewery in this country. That great concern has never had to work in competition with the tied houses throughout the country, as most of the breweries in this country do, and it has been extraordinarily well managed. In the other case, I do happen to have an interest, for I have got £50 of ordinary shares in that company, and, as I know to my cost, these shares were cut down to a fraction of their previous value. But it is a grave fallacy to compare the profits of breweries to-day with the profits in 1913. Everybody knows that practically all the big breweries in this country were either passing their dividends or paying very small dividends for many years before the War.

Colonel GUEST:

The breweries were over capitalised, and what the hon. and gallant Member says does not affect the argument.

Photo of Mr Henry Croft Mr Henry Croft , Bournemouth

Suppose I accept what the hon. and gallant Member says in the very case which he gave, no dividend on ordinary shares had been paid for a very long time. Owing to the War restrictions there were greater profits, but to suggest, that the breweries have made large fortunes owing to war conditions is a great exaggeration. Taking over the last 15 years, their profits did not work out at anything like 5 per cent. I think that that is normally true of the trade. The hon. and gallant Gentleman who seconded it said that if we carry out this suggestion there would still be £1,000,000 greater profits made by the trade than in 1913. The vast majority of breweries were paying no dividend in 1913. Does he suggest that that would be fair? Has he calculated what is the total value of this trade? It is said that this is not a trade which gives large employment. Let us be honest. The brewing trade, and its kindred trades in this country, are to England what the wine industry is to France. It is a colossal industry and gives enormous employment. It is not true to say that those connected with the industry have had a prosperous time. In the allied industries of this country there has been greater unemployment during the last few years than has ever been known in their history. Those engaged in it have in many cases lost all the profits that they could have made during the War owing to the great change in circumstances. When the suggestion is made that this duty is in any way comparable with the duty on tea, the House should remember that the duty on beer was regarded by a recent Chancellor of the Exchequer as an equivalent to Income Tax. That is what he said in reply to a deputation. The tax is 13 times higher than it was before the War. Is there any taxation in the country quite comparable with that?

Photo of Mr William Pringle Mr William Pringle , Penistone

Sugar. It is 14 times.

Photo of Mr Henry Croft Mr Henry Croft , Bournemouth

I think that my hon. Friend will find that it is not 13 times higher. The fact remains that this tax is a very heavy burden, and I believe that when hon. Members look at the question from that point of view, and realise how largely the burden has fallen on the working classes of the country, they will not grudge this slight remission in view of the tremendous shortage in the wages of the workers of the country at the present time.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

I will support the hon. and gallant Gentleman below me, because the question will be put in the form of leaving out 20s., which it is necessary to do in order to move the Amendment, which I have put down, to substitute £2 for the 20s. I agree with the hon. and gallant Gentleman (Colonel Guest) that the brewers can, without any injustice, be made to contribute a good deal more to benefit the consumer, but in any case I had intended, had I been called, to move to double the rebate. The person who has not been sufficiently considered in this question has been the unfortunate consumer of beer. I believe that the great majority of this House at the last Election were given a mandate from the majority of their constituents to do all they could to reduce the price of beer. I can only speak with certainty of my own case, and I speak for a very deserving class—the dock labourers in the port of Hull. They have demanded distinctly a lower price for beer. They say that in the case of the Chancellor or myself, or most other Members of this House, we are not prevented by pecuniary considerations from consuming as much as we like of beer, or anything else in that line, but that the man working for wages is so precluded from purchasing beer, which he otherwise would purchase, by the prices that at present prevail. Whatever our views about temperance may be, that is unjust. You are forcing, by taxation, the poor man to forego certain things that he wishes to buy, whereas the rich man is not so penalised. That is very unjust, and it is a side of the question that is often overlooked.

7.0 P.M.

I put down my Amendment with the idea of getting some declaration from the Chancellor on the question. The present rebate which has been arranged with the brewing companies is supposed to allow for 1d. coming off the price of the pint. If we double that rebate will 2d. come off the price of the pint by arrangement with the brewing companies? Or if not, what is the amount of rebate required to reduce the price of beer by 2d. a pint? There are many people in the country who would like to have an answer on this point. Further, I would like very much to know whether any agreement has been reached with the brewing companies as to the quality of the beer? That is a matter that is continually overlooked, and is a question of great importance. It is all very well for the hon. Member for Huddersfield (Sir A. Marshall) to smile about this, but we are sent here to represent a certain point of view which has nothing to do with temperance. While things are as they are in this country this is a matter of great importance to these quay side labourers in Hull, who are very hard working efficient body of men who resent very bitterly the price which they have to pay, and who are not satisfied with the reduction of 1d. per pint. On this question of quality they also have a very strong feeling, and they want some assurance that the brewers have given a guarantee that they are not going to make up for the reduction in the price of the pint by reducing the quality. If the Government have not insisted upon the quality not being reduced, they have been extremely lax in looking after the interests of the consumers, but there is still time to rectify it. In the most friendly way, I represent to the Chancellor of the Exchequer that he should look into the matter. After all, we have not parted with the Finance Bill yet, and I dare say Amendments can be made. There is one point to be remembered, and I want to put this to those who think with me on temperance questions, and who possibly are rather chary of supporting any Measure to make beer cheap. What is happening in many cases at present in regard to workmen who drink beer is that either they cannot afford to drink it, and do not drink it, which is unjust; or, which is even worse, they feel they need it, and must have it, and they buy it, whatever the price. That means less money going into the home; less money for the wife; and less money being spent on the children. Both these alternatives are extremely objectionable. The Chancellor of the Exchequer, I suppose, will say he cannot possibly afford another £16,000,000, or whatever the amount may be. To that, I will only say this: I believe the best way to ensure the economy which we all want is not to give the Government so much money. That is really the only way we can do it. That is one way in which this House of Commons can ensure that less money is spent by the Departments. That is the answer to what the Chancellor of the Exchequer will say.

All I want to say, in conclusion, is, that I shall vote with my hon. and gallant Friend in this matter. I agree with him that a case has not been made out sufficiently on behalf of the brewery companies. Certainly, so far as the gravity is concerned, I do not think a case has been made out, or at all a clear case, and it was not at all well supported. I say, however, that the price of beer to-day is too high, even with 1d. off. There will be resentment among the labouring classes in this country while that high price continues, especially at this time, when wages are falling day after day. I am extremely disappointed that the Chancellor of the Exchequer has not been able to do more, but in the meantime I ask him to answer me on the two points I have raised, namely, how much will it cost to take an extra penny off, and whether we can have some assurance that the quality of the beer will be kept up?

Photo of Mr Carlyon Bellairs Mr Carlyon Bellairs , Maidstone

I was rather impressed by some of the arguments of the Mover and Seconder of the Amendment in regard to the profits the brewers have made. I submit, however, that that is an argument that the brewers should put some of those profits into a better quality beer, while if the Amendment were carried the consumer would lose the benefit of his 1d. a pint, altogether. Therefore, I cannot support them in their Amendment. I was much more impressed by the proposal of the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) that we should have double the amount taken off—2d. instead of 1d.—which would have a real effect throughout the community. I have put down a modest proposal to give three halfpence off the pint, although I am told that that is not a practicable sum, because so many half-pints are sold, and the retailers will not deal in facthings. That could be got over, however, by a system of checks. It is well that we should have a discussion to-day, because last year the discussion on this question took place in the middle of the night, between one and two o'clock, and that is not a very good way of considering the matter. I cannot help feeling the changed atmosphere under which we are discussing this question to-day, because then the present Under-Secretary for Foreign Affairs was going into the Lobby against the Government to bring about a reduction of £22,000,000 in the revenue from beer, that is to say, an amount of £24,000,000, but if there was a 10 per cent. increase of consumption, the loss would be £22,000,000, and now we find we can do it for £16,600,000 in a full year with the brewers' contribution. The Under-Secretary exhorted us in almost the words of the Elizabethan poet Spenser: Be bold, be bold, and ever more be bold. He said, "Let us go boldly for this reduction." That is what I was prepared to do to-day. I can accept the suggestion made by the hon. and gallant Member for Central Hull, but I cannot support the present Amendment. What were the conditions under which we discussed this question on that occasion? We were assured there was no surplus available, but that it would cost £22,000,000. In the discussion the hon. Member for Hampstead (Mr. Balfour) said that there was a large surplus in the unpaid Income Tax to come in, and the Chancellor of the Exchequer at once replied that that had been fully discounted. The result was that I voted with the Government believing that they had no revenue available, and felt I was misled on that occasion. On this occasion, the circumstances are very different. We have an amount applied to the Sinking Fund of £40,000,000, and there is a small surplus beyond that. It is quite possible that the right hon. Gentleman is under-estimating his revenue, just like the previous Chancellor of the Exchequer, and over-estimating his expenditure as the previous Chancellor did.

Photo of Mr Carlyon Bellairs Mr Carlyon Bellairs , Maidstone

The revenue was about the same. At any rate, the Exchequer was all wrong about the Income Tax receipts. Therefore, I think it is quite possible to give this 2d. reduction, and I will address myself to the argument in regard to why we should reduce the Beer Duty more than any other duty. The hon. and gallant Member for Bournemouth (Lieut.-Colonel Croft) said, with perfect truth, that the tax per standard barrel had been increased 13 times. It was 7s. 9d. per standard barrel before the War; it is 100s. per standard barrel now. The remarkable part of those taxes has been that the main increases have been since the War. The tax was increased six times since 1913; in 1918 we doubled it to 50s. a standard barrel. Not content with that, in 1919 we increased it to 70s. per standard barrel, and in 1920 to 100s. per standard barrel. The wages are nothing like the same as they were in 1920 when the tax was last increased. In fact, the tax, as it stands to-day, represents 28 days' wages of an agricultural labourer drinking only a pint a day or, if we reduced it by as much as 1d. a pint, so that instead of taxation being 3⅓d. on a sevenpenny pint, it would be 2½d. on a sixpenny pint, that would represent 21 days' wages of an agricultural labourer.

I say that that is a tax which amounts to prohibition by taxation. When we compare it with any other tax we find a very different state of affairs. The Income Tax was not increased subsequent to the War, yet no less than £78,000,000 have been taken off the Income Tax. The Beer Duty, when this £16,600,000 has been taken off, will still represent a sum of £80,000,000 more than when the War was finished—that is, more than the revenue from beer in 1918. Therefore, it will not represent anything like what has been done for Income Tax, not that I find fault in any way with what has been done for the Income Tax. I spoke about tea, when the Tea Duty was under discussion. I take coffee and cocoa. Both of these articles had a preference given them in 1919, and another preference was given in 1922. The same thing is true of sugar. It is true of this Beer Duty what is not true of sugar, that by agreement between the Government and the brewers you can ensure that the consumer gets the full benefit of the reduction in taxation.

Taking the other classes—not the working classes. I find that beer is probably supplied in dozens of pints. Before the War a man was able to get beer at 2s. 6d. per dozen. He now pays 8s. 6d. a dozen, and the penny per pint off will not help him very much. Yet 8s. 6d. per dozen is again prohibition for large numbers of the middle classes in this country, because they cannot afford it. I recall to the House what Bismarck said: That a nation of beer drinkers was a contented nation, while a nation of whisky drinkers was fit for treason and stratagem. The Irish are whisky drinkers; the English are beer drinkers. Bismarck said another thing, which is very true. He said: In war it is the imponderables that matter, much more than any material factors. I would say that in peace time it is the simplicities that matter, and I would tell the House a little story of the revolution in Berlin in the last century. General von Siemens, the great inventor in submarine telegraphy, was present at that revolution, and his description concerns the question of beer. The revolutionaries went out, and besieged the palace. A prince of the same name as the German Ambassador, who was here in 1913, came out on the balcony, and asked them what they wanted. They said they wanted the military sent away from Berlin. He replied, "It has already been done." Then he asked if there was anything further they wanted. They said they wanted the beer gardens kept open till a later hour. The Prince replied, "That will be granted," and asked them if there was anything further. They said, "We want to be allowed to smoke in the streets." He said, "That is granted." The General relates that they all turned to each other, and said: "What else is there to fight for? Let us go home."

I believe that the price of beer and the quality of beer are two of the biggest causes of discontent in this country. I notice that Mr. Samuel Gompers, the President of the American Federation of Labour, said that Bolshevism in Russia was preceded by prohibition. It is the case that the price of beer leads to discontent. It ought to be the first object of the Conservative party to allay this discontent, and one of the best ways they can do it is by keeping down the price of beer.

Photo of Mr James Sexton Mr James Sexton , St Helens

Personally, I do not think it adds to the dignity of a Member of Parliament to go into the details of this subject, at all. I will not do so at length, but I want to say that I am in agreement with the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) in what he says about the dockers whom he represents, and the men I represent. These men require some kind of stimulant in the work they are doing. There are men engaged in coaling ships, who do not see a bit of light during the whole of the day. They are swimming in coal dust, and they do need some kind of liquor. No one need be so much concerned about the quantity as about the quality of the beer. If the thing they call beer were real beer, there would be something to be said for it. The kind of beer working men are getting to-day is conducive to riot in half a gallon. One of my fears is, that the more we reduce the tax on beer, the lower the quality of the beer will be. Ordinary beer to-day is not the old hops beer; it is largely made up of chemicals. There is neither song nor dance in a couple of gallons of it. I shall certainly do all I can to assist in reducing the price, but, at the same time, I would very much like to raise the gravity.

Photo of Mr Charles Roberts Mr Charles Roberts , Derby

I agree with the hon. and gallant Member for Maidstone (Commander Bellairs) that there are political considerations involved in this tax. I do not know that I agree with him elsewhere, but there are interests which have to be considered, apart from the mere contentment of the beer drinking-population. The Chancellor of the Exchequer put it in this way: He was looking round for reductions. For reasons which we shall have to examine later, he put sugar regretfully aside. After that, feeling that he must reduce something, he came to beer; he had exhausted everything else. I do not forget that in the time before the General Election the Chancellor said that when the time came for reductions in taxation, it would be his duty to consider what methods of relief would best serve the national interests, and he added, "Beer will certainly be one of the first subjects for taxation to come under review." He and, I believe, the Prime Minister, held out these hopes of reduced taxation on beer, and the Chancellor of the Exchequer has told us that he is an honest man who redeems his debts, including his electioneering debts. A reduction of the beer duty is part of that redemption. Under the circumstances we must ask him a few questions.

It is not easy to do sums when one is on one's feet. This subject involves abstruse calculations. The Chancellor has all the figures before him, and I ask him to explain how he makes his estimate. He has told us that he will lose £15,000,000 in a full year. I have tried, but failed, to follow that calculation. Does it mean that he is allowing for an expansion in the consumption of beer by 5,000,000 or 6,000,000 bulk gallons? Will he tell us whether that is right? If it be right, it is rather a serious matter for the country to consider. In bulk consumption it will bring us tolerably near to the pre-War standard. Hon. Members who are interested in beer may sing the praises of beer, but the fact remains that an increased consumption of that kind will undoubtedly be reflected in the increased figures of drunkenness. [HON. MEMBERS: "No!"] As that statement is challenged, let me give some figures. In 1919 about 17 standard gallons of beer per head were consumed in the United Kingdom. The figures of drunkenness for that year were 57,948. The next year the consumption went up to 20 gallons per head, and the convictions immediately rose to 95,763. The consumption figure the following year fell to 18 gallons per head, and the drunkenness convictions were 77,789.

Assuming that I am right in my assumption that the Chancellor of the Exchequer is calculating on this increase of 5,000,000 or 6,000,000 gallons in the consumption of beer, I hold that next year we shall see that increase reflected in the increased convictions for drunkenness. That, after all, is only an index of the social degradation, squalor and misery of which the figures are a measure. There is also a revenue question involved, and as to this there is some misconception that I should like to have removed. It is not as if the calculations of Governments were always so sound. When the right hon. Member for West Birmingham (Mr. A. Chamberlain) put this extra tax on the barrel, he anticipated an increased revenue of £10,000,000; but, as was shown in the Report of the Commissioners of Customs and Excise, in the following year he was £13,000,000 out. Governments make mistakes of that kind. One is impelled therefore, to ask whether the Chancellor has made sufficiently careful calculations. My suspicions are increased, because I read in the liquor trade papers that he has adopted very largely the suggestions that were put before him by the trade. Of course they asked for more. They claim that this concession of a rebate from 1st April, which they say is unprecedented, was due to their representations, that when they went before the Chancellor on 8th March they put before him a statement of their case, and that he has very largely adopted their figures. We may fairly investigate the matter in order to see whether some revenue which the Chancellor is now allowing to go into the pockets of the trade cannot be secured for national purposes.

It has been suggested that the rise in the profits of the brewing trade from £9,000,000 in 1913 to £17,000,000 in the present year—I believe that is an underestimate—is only the restoration of a normal state of profit in the trade. But this was done very largely while these manipulations of the tax were taking place. The trade always gets the better of the Chancellor of the Exchequer in these arrangements; it always succeeds in making a profit on the tax, whether it is imposed or taken off. It has a weapon in its hand which enables it generally to get round the intentions of the Chancellor of the Exchequer. It can always increase or lessen the gravity of the beer. We ought to know what the Chancellor's Estimates are, how he arrives at them, and he ought to convince the House that he is not leaving in the hands of the brewing trade an additional profit, such as they have undoubtedly been able to secure from the various changes in taxation during the War years and later. There is a good deal of misapprehension about the nature of the tax. I understood that the hon. and gallant Member for Maidstone thought it was due to the trade to get this kind of remission. He put the tax much too high. He took it at £5 on the standard barrel, whereas anyone who looks at the figures knows that that is not the tax which is charged. The standard barrel is a fiction of the Chancellor's imagination; it is not the real bulk barrel which contains the liquid. If you work it out you will see that, although the nominal tax on a certain strength of beer is £5 per barrel, the tax really charged in the last year was on the average only £4. What the Chancellor is now doing is to reduce that tax to a minimum of 24s. per barrel, rising to a tax which will not exceed 60s. on the average per bulk barrel.

When the hon. Member said that the taxation was 14 times higher than in 1913, he was assuming that all beer was taxed at £5, when he knew perfectly well that it was not so taxed. As a matter of fact, the taxation on sugar has been more raised than the taxation on beer. Take the taxation off entirely, and leave it entirely out of sight; you will still find that beer is to-day 100 per cent. above the pre-War price. Of the pre-War price of 2d. for the pint, ¼d. was duty, and the consumer paid for the beer itself 1¾d. per pint. To-day, under the Chancellor of the Exchequer's proposal, the charge will be 6d., of which 2½d. will be duty and 3½d. will be the cost of the beer untaxed. The price, apart from the duty, has been raised from 1¾d. to 3½d. per pint, a rise of 100 per cent. If you have a rise of 100 per cent. in a commodity, above what it was in pre-War days, it seems to me you have got a margin for asking that the brewers shall concede a larger measure to the Exchequer and that the Exchequer has not done very well in its bargain with the trade and has not succeeded in getting a sum which has been estimated at £3,500,000 or £4,000,000, and which, if we could claim it for the national Exchequer, would be very useful for the purposes of reform. I think the hon. and gallant Member for Maidstone said that the brewing trade did not expect any expansion as a result of this reduction. That is not what the "Brewers Journal" says. In reference to the proposal to enable the retail price to be reduced by at least 1d. per pint, the journal says: When a probable increase in consumption amounting to 20 per cent. which would be likely to follow upon a reduction of retail prices is allowed for— then it goes on to say the Chancellor will be able to make the concession. So the journal of the trade assumed that this reduction of price will be followed by a considerable increase of consumption. May I ask the Chancellor to lay all his cards on the table and to tell us how he makes his calculation and what extra consumption he allows for? We shall then he in a far better position to see where we are. There is a further point which the House should bear in mind. I have shown that, apart from taxation, the price of beer is 100 per cent. above the pre-War price. At the same time there has been a heavy fall in the price of materials. One of the trade journals estimates that at no less than 8s. per barrel.

Photo of Mr Henry Croft Mr Henry Croft , Bournemouth

Not compared with the pre-War price.

Photo of Mr Charles Roberts Mr Charles Roberts , Derby

As from 1920. I am sure my hon. and gallant Friend does not contest that statement. If the price of beer is 100 per cent. above the pre-War price; if the reduction in the price of materials is anything like 8s. per barrel, and if the consumption is going to go up so that the Chancellor of the Exchequer cannot plead that overhead charges have got to be allowed for—because we shall be getting very near to the pre-War consumption of beer—then I say the case is made out that what the Chancellor of the Exchequer is going to do is to leave in the hands of a trade which has done extraordinarily well during the War a sum which the Mover of the Amendment put at £4,000,000, but which I am inclined to think is more than that. That sum is required in the interests of the country, and if the Chancellor of the Exchequer leaves it to increase the already swollen profits of the brewing trade, then we think he has not made a good bargain for the country. Apart from that, I must again say that in my view, however popular it may be, and whatever electioneering value there may be in lowering the price of beer, that electioneering value and that possible contentment of a part of the electorate which no doubt will be displayed, is dearly purchased at the cost of the social degredation and misery which inevitably follows an expansion of the brewing trade. In that way I believe the Chancellor of the Exchequer is really sacrificing—it may be for electioneering interests—the real, vital and permanent interests of the nation.

Mr. HILTON YOUNG:

I rise to support warmly the Amendment of my hon. and gallant Friend. I am sure the Chancellor of the Exchequer will agree that although we may not have quite succeeded in converting him upon this point, we have at any rate raised an interesting and informing discussion. This is a matter of a purely fiscal and arithmetical nature into which it is unnecessary to introduce any party quarrels, and I think the House will agree with me, that a very remarkable unanimity of opinion has been shown as to the grave doubt which exists in the minds of hon. Members whether the brewing trade is being called upon to make an adequate contribution to the reduction of 1d. in the pint. The hon. Member for St. Helens (Mr. Sexton), I understand, has grave doubts upon that question, from the point of view of the consumer of the wage-earning class—subject to a very important qualification which I should like to reinforce later on. The only dissentient voice so far seems to be that of the hon. and gallant Member for Bournemouth (Lieut.-Colonel Croft). He will pardon me for saying that that perhaps is not wholly unexpected. The argument of the hon. and gallant Member for Maidstone (Commander Bellairs) I followed with complete agreement up to the last point. I understand that he, too, is of opinion that the contribution of the brewing trade is scarcely big enough. He, too, has grave doubts on the matter.

Photo of Mr Carlyon Bellairs Mr Carlyon Bellairs , Maidstone

I have a perfectly open mind. I did not say the brewers were not contributing enough. I was a little bit impressed by some of the arguments used on that matter, but my point is that you will wreck the whole scheme, if you pass this Amendment.

Mr. YOUNG:

That was rather my impression. But perhaps my phrase was a little clumsy, and I did not properly express the hon. and gallant Member's intention. What reason can there be, however, for not supporting the only Amendment, by which you can secure a larger contribution from the brewing trade? That is the final step, but, of course, it is not unusual to refuse to take the final step, when that final step is from the wrong benches.

Photo of Mr Henry Croft Mr Henry Croft , Bournemouth

I thought the hon. Member's party promised the Government general support.

Mr. YOUNG:

If the hon. and gallant Member challenges me as to why, upon such a Measure as this, general support is not given to his leaders, may I give him the reply? I know of some Members of this House who have promised to give general support to his leaders when his leaders are right. If he desires to obtain that support, he has only got to secure that his leaders occasionally do something right, and they will then receive it. Let me continue what I have to say about the subject before the House and define what I believe to be a self-consistent and reasonable attitude towards this question of reduction or rebate. I am not myself opposed to a reduction of the duty upon beer and I believe that also is the attitude of the Mover and Seconder of the Amendment. They are in favour of a reduction of the duty upon beer, and we are in favour of it, as soon as the country can afford it. We are in favour of it, as soon as the country, in the first place, has reduced other taxation which it is more important to reduce. I shall not, and I imagine other Members on these benches will not, vote against a reduction of the Beer Duty for these reasons. First and foremost, we believe it is essential, in the finances of this year, that there shall be a general reduction of taxation, and it is of secondary importance whether that reduction is a reduction in direct taxation or in indirect taxation. If you make a reduction in direct taxation, it spreads to the wage-earner in the form of better employment. If you make a reduction in indirect taxation, it spreads over all classes of the community, from the wage-earner upwards, in the form of better demand, better trade, and increased profits. Wherever you reduce taxation the final good effect spreads over the whole community. It is therefore of secondary importance whether you reduce direct or indirect taxation. It is also of importance that particular classes of taxpayers should get the first immediate and visible benefit of tax reduction. That is why, other things being equal, there would be no opposition to a reduction of the duty on beer, but other things are not equal so long as the duties on sugar and tea are unreduced. That it would be out of order to argue, however, on this Amendment.

Let me say a word in support of the contention advanced by the hon. Member for St. Helens. I am sure the Chancellor of the Exchequer will agree that the method of the reduction of taxation by indirect rebates is, generally speaking, unsatisfactory. How are you going to make sure—I am sure the Chancellor must have anxiously asked himself the question—that the benefit percolates into the pockets of the consumer? I ask the right hon. Gentleman this question upon this actual tax. How is he going to make sure? Is it by agreement with the trade? There I should like for one moment to make a diversion. I think an agreement with the trade made before the production of proposals on the Floor of this House is bad financial practice, and contrary to the true theory and the essential morals of Parliamentary government. It is a dangerous thing that such an agreement should be entered into with the trade, concerning a reduction of taxation, before proposals are put to this House and before schemes are propounded in this House. It is contrary to the true theory of Parliamentary government, and, what is more, there is no legal force in such an agreement. I do not mean to say that the brewing trade are afterwards going to put on the 1d. which they have just taken off. I cannot imagine them doing anything so contrary to good faith and also so imprudent. But I do not know what reason there is why they should not take it out of the unfortunate consumer in the quality of the beer. That is the question asked by the hon Member for St. Helens with so much pertinence, and I desire to reinforce his point.

What guarantee has the Chancellor that that the consumer is not going to be made to pay for all this reduction by having the value of the brewers' contribution taken out of the quality of the beer? We all know, who have studied the subject, that there are seasonal or minor variations in the quality and gravity of beer made to suit changes of weather and temperature. There is plenty of opportunity, when these seasonal and minor variations are being made, for the brewers to get back upon the swings what they have lost upon the roundabouts. The Debate upon this Amendment has been concentrated, and rightly concentrated, upon the question of whether the brewers cannot afford to make a bigger contribution towards the rebate. For my part, listening to the figures which have been produced, I am more confident now than I was when the Debate started, that no case has been made out by the Government that the contribution of the brewers should not, be substantially increased. What do we know as the principal events in the history of the beer trade since the War? Those of us who have been interested to watch it have watched with amazement this curious result, of a steady fall in all the raw materials of beer, a greater fall than in many trades which have been more conspicuous in the public eye for reduced prices, a fall in every raw material which is used in beer, including the most important of all of the raw materials, namely, wages, but no corresponding reduction in the price whatever. If you take similar economies and costs in any other trade, you will find equivalent reductions in price to countervail them, but in this trade alone none of any sort, and at the same time these enormous profits being earned. A very striking instance of such profits was given by my hon. and gallant Friend in introducing the Amendment, and on being challenged by the hon. and gallant Member for Bournemouth, he gave the instance, which was one from Ireland. My hon. and gallant Friend seemed to think that put it out of court as an argument, but was he not quite wrong? Of course, he was wrong. The revenue from this great Irish brewery is still a matter of intimate concern to us. I am afraid I am not acquainted as to where it comes in now, but I imagine it comes in the attributable share of Irish revenue. If it does not come in that form, it comes in some other form. It might be in Customs. In any case, it is a striking instance of these enormous profits being earned, with nothing to set off against them in the way of advantage to the consumer. It is clear that the brewers can afford, and ought to afford, a very much larger contribution to the rebate than has been demanded by the Government in this matter, and I believe this Committee ought not to be content, as acting in this matter in the interests of the consumers of the country, and particularly of the wage-earning class, without exacting from the trade a very much larger contribution towards the rebate.

Photo of Mr Stanley Baldwin Mr Stanley Baldwin , Bewdley

I will try to answer some of the points which have been raised in this discussion so far, but with the full knowledge, expectation, and hope that we may be able to pursue the matter further during the Finance Bill. I hardly know where to begin, because the attack of my hon. Friend the junior Member for Derby (Mr. C. Roberts), staggered me. But I should like to assure him that I never gave any pledge of any kind to reduce any form of taxation at the last Election, and, indeed, I "blurted out," as one of my critics said, that I did not think the Budget would balance at all. Further, I should like to add something that may find favour in his eyes, namely, that I have never held a single share in any brewery or distillery of any kind, so that I am able to approach this subject without heat.

I would ask the House to remember one thing, which I think might perhaps be somewhat of a surprise to it as it was to me, and that is that there is no instance of which we know where the Beer Duty has been reduced, so that we are facing a new problem. The difficulty that I had, or anyone who had been in my place would have had, to face in the present year was this: How could you make certain that the reduction in the rate of duty which you were going to make should reach the consumer, and not only the consumer, but all classes of the consumer equally—that is to say, the man who drinks the better qualities of beer, and the man who drinks the less good qualities of beer? That is a real problem, because had the taxation remained after reduction simply on the basis of a tax on a standard barrel, the man who brewed the higher gravity would have scored at the expense of the man who brewed a lighter gravity, and he would have been able to make the reduction that is proposed very easily, while the brewer of light beer would not. It was proved to my satisfaction that had the taxation been maintained on that basis, it would have been impossible for the brewer of the cheap beer to make the reduction in retail price which would give the consumer the desired benefit.

That was the problem, and there was another factor in it that rather complicated it. So far as I could see, there was no alternative to coming to some kind of agreement, except to reimpose war-time control. If there is any other way of meeting this difficulty, I should like very much to know what it is. There was no power to ensure that what one desired would take place—there was no other method—but agreement, and let me point this out. With some of what my hon. Friend the Member for Derby said, I do not agree. I think, if I may say so, that we all know he feels very strongly on these matters, and that sometimes he is a little less fair in discussing any sub- ject connected with drink than he is in other matters, but it is true that the brewing trade have ways in which they can recoup themselves for taxation. We all know that the whole question of gravities is an extraordinarily difficult and complicated one. Let me put it in this way, which I think could offend no man, not even the brewers. If the brewers felt that they were being unjustly and unfairly treated, it is perfectly within their power, by lowering gravities, not only to cheapen the production of their own beer, but to do me out of a good deal of revenue that I ought to have, because every point that gravity falls means a reduction of £1,750,000 to the Exchequer, and a fall of only three points in the gravity that is brewed would wipe out all the difference which is proposed in the Amendment before the Committee.

Photo of Mr Stanley Baldwin Mr Stanley Baldwin , Bewdley

I do not see that you can. Let me add that there is no particular original sin in the brewers over this matter. It is common to every class of Englishman. If an Englishman feels that he is being done, he will see if he cannot turn the tables, and therefore surely, unless the people with whom you are dealing feel that you are treating them fairly, you will not get the best out of them. I think that stands to reason, but, all the same, I go a long way in agreement with my right hon. Friend the Member for Norwich (Mr. Hilton Young) in that I regret the necessity of having to have discussions of this kind at all; and yet I could see no way out of it, with the present penalising tax on beer, if I was to ensure, what we all desire, that the benefit of the reduced taxation, whether wholly reduced taxation or partly reduced taxation and partly a reduction borne by the trade, should go to the consumer. There is a great difference as regards the possibility of getting the benefit for the consumer between the taxation of beer and the taxation of sugar, of which we were speaking last week. In the one case, at home, we can get a certain amount of, or at any rate a substitute for, control by agreement; in the other case, we can get no control of any kind, either by agreement or otherwise, and it did strike me as rather odd, when I found that I had been attacked from the benches opposite, first, on the ground that I had not reduced the Sugar Duty, and then on the ground of the method by which I was reducing the Beer Duty. Their complaint seems to be that in the one case I ought to have thrown a lot of money into the pockets of American millionaires, and in the second place that I was not taking enough out of the pockets of our own people at home. It seems to me that one's only chance really of carrying out a popular Budget is to pour our millions out of the Exchequer into the pockets of foreign speculators. The hon. Member for Derby asked me one or two questions, which I shall be only too pleased to answer as well as I can. The amount of extra consumption that I am estimating for is 2⅓ million bulk barrels. I am estimating for a consumption of something like 26,000,000 bulk barrels. That is not near the figure of the pre-War production, and the Committee will be able to see that the amount of contribution which I have obtained from the trade is not inconsiderable, for in a full year the contribution of 4s. a bulk barrel comes to £5,250,000, which I call a very substantial contribution.

Photo of Mr Charles Roberts Mr Charles Roberts , Derby

The £26,000,000 with which this is being compared includes in past years the contribution from Southern Ireland. How much allowance has the right hon. Gentleman made for that?

8.0 p.m.

Photo of Mr Stanley Baldwin Mr Stanley Baldwin , Bewdley

I am afraid I have not got that figure in my head. I shall be very pleased to get all the figures, if the hon. Member desires them. I have no doubt we shall have this up again during the Finance Bill, but the figure I have given now compares with the figures for last year, which did not include Southern Ireland. It is a very technical matter, and I do not pretend that at this moment I have the whole of the figures in my head. I was just saying that the contribution comes to about £5,250,000 in a full year, and here I should like to touch on a point that was raised by the hon. Member for Derby, as to how the trade had gained by the fall in the prices of materials and the fall in wages. I do not quarrel—although I do not set up to be an expert—with the figure that was given, which, I think, was 8s. a barrel, but I would point this out, that, in my view, so far as I am able to ascertain, I think that that gain has been almost wiped out in two directions. It has been wiped out partly by the increased cost of the overhead charges owing to reduced production, but mainly by the increased gravity which the trade have given over the past three years. The average gravity has improved, and that means that the quality of beer has improved during the last three years by something under three degrees. These two sets of figures about cancel each other, and whatever future benefit the trade are going to get as a set-off against what they are surrendering must come—unless there are further falls in materials and labour—from the increase of production and from whatever they may get from the resulting fall in the overhead charges. I heard the figure the hon. Member for Derby mentioned. He had been reading the trade paper. I am ashamed to say I have never read the trade papers, but I will read them for the future; but I used to buy trade papers when I was in trade, and they were not always correct, and I have no reason to believe that these figures are correct. I had various meetings with the trade, and after speaking to them I felt that I could not look for more than a 10 per cent. increase of consumption with the 1d. reduction. It is quite true, as the hon. and gallant Member for Bournemouth (Lieut.-Colonel Croft) said, that the trade itself was not at all anxious to have this reduction; it was a question of the big reduction of 2d. or nothing. One hon. Member asked me, I think it was the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) what the extra 1d. would cost if the 2d. had been given instead of the 1d. The total rebate would have cost £30,000,000 this year altogether and £38,000,000 next year—a good deal more than I had to give away. Of course, it is possible that, had we been able to look at these figures, we might possibly have got something more out of the trade to cover the increased reduction in the selling price.

Photo of Commander Hon. Joseph Kenworthy Commander Hon. Joseph Kenworthy , Kingston upon Hull Central

Was that agreement made with the trade, that the 2d. off would cost £30,000,000 in the same way as the 1d. off would cost a proportionate sum?

Photo of Mr Stanley Baldwin Mr Stanley Baldwin , Bewdley

I am not sure I quite follow my hon. and gallant Friend. There was no such agreement. During the time of the preparation of the Budget I received a deputation from every party that was interested in the Budget—whether it was beer, or whisky, or mineral waters or cinemas. They had all some ultimate point they would have liked to reach. 2d. was the ultimate point the trade would have liked to reach, but, as with so many other deputations, it was perfectly impossible with the money at my disposal to go anything like the full distance to meet them any more than I have been able to meet many of the other deputations that came. I do not know that there is any other point at the moment that I need deal with, because I am quite certain this matter will be raised again, and we shall have opportunities on the Committee stage of the Finance Bill of going into these matters more in detail. I would merely repeat my conviction to the House that in the circumstances there was no other way than by agreement to give effect to an arrangement whereby the consumer would get the full benefit of the reduction. I consider that, taking the trade as a whole—including those who brew the weaker qualities of beer—this is not an unfair contribution, and I had an undertaking, so far as it can be given, that the quality will at least be maintained. My own conviction is that when this has gone through, and if some of the brewers find they are doing better than they anticipate now, I am quite sure we shall see a continuation of the process which has been going on for the past two or three years in an improvement of the beer, and that this time 12 months we shall have better beer from the bottom up to the top than we have had hitherto. None of these arrangements and none of these agreements are or could be ideal, but this particular agreement meets an unprecedented and a very difficult case, and though I think there is ample room for difference of opinion as to the amount the trade ought to be asked to contribute, I hope no one in the House will feel that I have not been met candidly and honourably by the trade, and I hope there may be no imputation of motives of illegitimate profiteering at the expense of the Government—charges for which I think there is not the slightest foundation.

Photo of Captain Reginald Berkeley Captain Reginald Berkeley , Nottingham Central

I personally find it extremely difficult to use words adequate to express my surprise and indeed disappointment with the state- ment we have just listened to from the Chancellor of the Exchequer. If he will permit me to say so, the remarkable speech he made in introducing his Budget, and his still more remarkable reply on Wednesday, led me personally to expect something far more satisfactory than the very superficial treatment—if he will forgive me using the word superficial—that he has meted out to this important subject. The case that has been put froward has not been met or answered at all in one single particular. We have had a general admission from all sides of the House that there is a substantial reduction in the working costs of the brewing industry. I do not want to go into details in the matter, but it is quite obvious there have been immense reductions. You have barley, which was costing 100s. a quarter in 1921, costing 45s. a quarter to-day. You have a corresponding reduction in the price of hops. You have, as the hon. Member for Norwich (Mr. H. Young) pointed out, a great reduction in wages. You have got the railway rates down and you have the ordinary municipal rates down also. That seems to me to make a very formidable case, and the hon. Member for Derby (Mr. C. Roberts), when he quoted 8s. per barrel from a trade paper, was not, I believe, putting it too high. I do not see, in default of some attempt to make this case, that the right hon. Gentleman is justified in brushing aside this objection with a sweep of the hand and saying it is merely a quotation of exaggeration out of the Press. I think that is a point of substance, and I think someone from the Treasury Bench should reply to it and deal with it in detail before the Debate is over.

No attempt has been, again, to deal with the point that this reduction of 1d. a pint is going to lead to an increase in the consumption of beer, and therefore to a great increase in the turnover. Again, my hon. Friend the Member for Derby put that increase at probably 20 per cent., and there is no attempt whatever to meet that point. One of the speakers, I think it was the Seconder of the Amendment (Captain Moreing), pointed out that in respect to the figures of the duty which was complained of by the hon. and gallant Member for Bournemouth (Lieut.-Colonel Croft) an increase of 13 times the pre-War duty had taken place, and, in spite of that, the profits in this great industry—which no one wishes to belittle; I certainly have no wish to belittle the brewing industry, which is a very important branch of our industry—but no attempt has been made to meet the case that their profits have swollen from rather less than £10,000,000 pre-War to considerably over £17,000,000 for 1921–22. These were the official figures given in answer to a question put by the hon. Member for Colne Valley (Mr. Snowden). We certainly know that the industry is by no means bankrupt to-day from the very remarkable statement of profits just made by an Irish firm to which the hon. and gallant Member for North Bristol (Colonel Guest) who moved the Amendment alluded, and in that regard I should like to point out to the hon. and gallant Member for Bournemouth that his criticism was not well-founded in this matter because, although it is true that the particular Resolution No. 2, to which this Amendment relates, only deals with beer brewed in Great Britain or Northern Ireland, Resolution No. 3 deals with beer imported into this country or into Northern Ireland. In reply to that case, which I say, with all respect to the Chancellor of the Exchequer, is a formidable case, if I understand his statement at all it really amounts to this, that if he were to call upon the brewing industry to bear this additional 4s., which, on the fact put forward by the hon. Member for Derby, seem to be justified by the admission of the trade itself—if he were to take advantage of that and double the contributions from the trade, the trade would defraud the Exchequer by watering its beer. It seems to me that that is as complete an admission of helplessness as I ever expect to hear any Government making. He says, quite truly, that the contribution the trade is making by this 4s. represents, in bulk, a total of £5,250,000. It is a very important contribution, but, surely, the logical result of that is that, as we have urged from this side of the House, the trade can afford, on its own showing, to make a further contribution of 4s. If that be the case, the Exchequer is making the trade a present of £5,250,000 of the taxpayers' money.

This is not in any sense an attack on the proposal to cheapen beer. I am only anxious to see beer cheaper. [An HON. MEMBER: "Oh!"] Possibly the hon. Member who interrupted with that noise is not aware of my own personal habits, but I have accustomed myself to drinking quite an amount of beer, not only on grounds of public policy, but also on grounds of my own proclivity and taste. I deplore the expense of beer, and would like it back at the pre-War standard. Passing away from that, what I am saying is in no sense to be interpreted—and I hope it will not be interpreted—as any attack on the brewing industry, which I regard, as the hon. and gallant Member for Bournemouth stated it to be, a most important industry, but which, I am bound to say, its balance sheets show is not an industry in any need of State assistance at this moment. It is not at all an attack upon the brewing industry, but I am perfectly certain that none of the speakers on this side, with, possibly, one exception, have any wish either to attack the brewing industry or to see the duty re-imposed, but, on behalf of the taxpayers, we do urge the Government, if they have facts in their possession which can really meet this case, to place the House in possession of those facts, in order that it may know how to vote on this Amendment.

Photo of Dr William Chapple Dr William Chapple , Dumfriesshire

The Chancellor of the Exchequer was good enough to inform us that he had made no promises to reduce the taxation on beer. May I remind him of this quotation from a speech which he made on this subject, and which had triumphant record in the "Brewers' Gazette"? These were his words: When the time comes when reductions of taxation are practicable, it will be my duty to consider what methods of relief will best serve the national interest, and beer will certainly be one of the first subjects of taxation to come under review. That was made before the General Election, and I ask whether I was justified in some remarks I have already addressed to the House in saying that this was Tory payment to those who had sent the party opposite into power? Not only was this encouragement given to the brewers, but the Prime Minister, talking on the Budget on the 2nd May, 1922, said; If I thought it possible to make a reduction in the Beer Duty, which would have a corresponding increase in the revenue, I would think it the right thing to do."—[OFFICIAL REPORT, 2nd May, 1922, Col. 1201, Vol. 153.] The Government, unfortunately, have come to the conclusion that the right thing to do is to make a reduction in the Beer Duty. They have forgotten tea and sugar, but they have remembered beer. They made no promise to the homes of this country, but they made a promise to the trade and they are fulfilling it now. I congratulate them on their loyalty to their election pledges. I want to emphasise this point, that the reduction in the tax on beer was deliberately calculated, by all those concerned, by the trade and by the Government, to increase consumption. It was deliberately calculated, and deliberately stated in the "Brewers' Gazette" over and over again, that if you reduced the tax on beer, you would increase consumption. With what result, and with what hope? To increase the Revenue? Not at all. Was the trade interested in increasing revenue? Not at all. They were interested in increasing the consumption of beer, and, therefore, the profits of the trade. That was their whole object and intention, and the Tory Government knew that just as well as any of us knew it before the General Election. So many promises did they make about this, so much was it part of their election propaganda throughout the country, that they actually forgot the homes of the country, the women and children, and only thought of the frequenters of the saloon. The hon. and gallant Member for the West Derby Division of Liverpool (Sir R. Hall) said: I always come back to the same point—Is it right to drink good beer? And there can be only one answer to that, and that answer is, 'Yes, and plenty of it.' I am not objecting to the hon. and gallant Member drinking all the beer he wishes, but I am objecting to a party coming into power pledged to increase the consumption of liquor by reducing its cost. There is another interesting quotation from the "Brewers' Journal" of the 15th February, 1923. It says: If the Chancellor of the Exchequer were to reduce the duty by 35s. per standard barrel—which, possibly, could enable the price of certain beers to be reduced to the consumer by 2d., and others by a penny per pint—then, when a probable increase in consumption of 20 per cent. is allowed for— Are they anxious to increase consumption of beer because beer is a wholesome beverage? Not at all. They all know it is not. Is it because beer helps the home? Not at all. It is because it would increase the profits of the trade, to whom this party was pledged up to the hilt by all its speakers at the last election. What is the social result of that? I have figures here that show the result of a decrease in the consumption of beer. In 1910, there were 26 gallons per head consumed—I leave out the decimal figures—and the cases of drunkenness in that year were, in round figures, 161,000. In 1921, the amount of beer consumed was 18 gallons per head; that is, it had actually come down from 26 gallons to 18 gallons. It was this that was causing the alarm to hon. and right hon. Members opposite. The reduction in consumption was alarming everyone on the other side of the House, and all those who voted for them and sent them here to reduce the cost of beer. The cases of drunkenness in 1921 were down to 77,000, so that pari passu with the reduction of beer consumed, there was a reduction in drunkenness. No one seemed to be concerned about that. Whether the homes were improved because there was less drunkenness or not did not concern anyone on the benches opposite. What did concern them was that they should get plenty of beer. Drunkenness, ruined homes, increased poverty, but the alarming sufferings of women and children never concerned them. All that concerned them was: "If we make a pledge to the trade we can depend upon the trade supporting us." They got that support, and they are now paying back, they think, the debt.

The "Brewers' Gazette" estimates that if you have 1d. off beer you will have increased consumption up to 20 per cent. But then you will increase the amount of drunkenness by 20 per cent. too. [HON. MEMBERS: "No!"] Obviously. I will give the figures. I have the figures for every year, and I see that as the consumption went down from 26 gallons per head to 22, 16, 20, 18, the cases of drunkenness have gone up or down similarly from 172,000 to 183,000 down to 84,000, 46,000, 29,000, 57,000 and 77,000; gone down practically pari passu with the consumption of beer. Drunkenness has gone down all the time, but not one on the opposite benches rejoices; everyone is depressed and alarmed, and everyone cursing the fact their electoral chances are governed by the trade. Now, said the trade, we have the hope that if the Chancellor of the Exchequer fulfils his election pledges, and if the Prime Minister fulfils the promises which he made, we will have this increased consumption of beer by 20 per cent., and also—I say—an increase in the cases of drunkenness by 20 per cent.

How does that work out? There will be 15,557 more cases of drunkenness because of the increased consumption of liquor. There is nothing in that, some say. Nothing in the figures I have quoted relating to the expected increase in the consumption of liquor? But it is a universal law that if you increase the facilities for getting beer you increase the amount consumed. Conversely, if you decrease the facilities for getting beer you decrease the amount consumed, and if you decrease the amount consumed you decrease the amount of drunkenness connected with that consumption. [HON. MEMBERS: "No!"] Surely! If you decrease the amount of drunkenness connected with the consumption of liquor, you decrease the disease, death, poverty, and disaster associated with its use. I am glad to make another point, and I hope that it will bring home to the right hon. Gentleman the logic and the irresistibility of my argument, so that we may get a concession along the lines we hope for. I have a graph here which shows the cases of wife-beating, and they are exactly parallel to the consumption of liquor. They have run on parallel lines ever since 1897. Actually on parallel lines. When an increase of the drinking of alcohol goes on, an increase of wife-beating goes on, and when one goes down the other goes down, too. There is the same rise and fall right through, ever since 1897 right down to the year 1920. If you cheapen beer you are the enemy of the home; if you cheapen sugar, tea, and other foods you are the friend of the home. There is nothing in this Budget, from start to finish, that is a friend of the home, a friend of woman, a friend of children. If you take the tax off sugar you increase the amount available for the children, with good effects. The same law obtains right through. You decrease the cost of the one, you increase the burdens of the home. Decreasing the amount of the tax on beer you send home drunken husbands, you persecute the suffering women; but, on the other hand, cheapen food, and you bless the home. There never was a time in our history when the homes of the country suffered more than to-day because of the dearness and the scarcity of food. There never was a time when it was more necessary to consider decreasing the facilities for the consumption of alcohol and increasing the facilities for getting cheap and abundant food.

Photo of Mr Godfrey Collins Mr Godfrey Collins , Greenock

Hon. Members will bear with me while I endeavour to speak in favour of the Amendment. From experience of this House one knows that if a decision is once taken on a new subject it is very difficult to get the House of Commons to take another attitude on the same subject at a later period. I will not follow the hon. Member who has just sat down, but I want to address one or two observations to the Chancellor of the Exchequer on the specific question in the Amendment. That is: "Is the bargain to be made on behalf of the taxpayer a good bargain or is it not?" It will be within the recollection of hon. Members that the price of beer was raised by 1d. a pint in 1920. When the right hon. Gentleman the Member for West Birmingham (Mr. A. Chamberlain) raised the price of beer by 1d. and increased the duty on the standard barrel, he informed the House that the brewers at that time were making abnormal profits, yet when the duty was increased the brewers were not only allowed to pass on the extra duty, but in addition were allowed to pass on to the consumer a certain percentage of that ordinary duty. The position to-day is that the 1d. increase has in the time disappeared, and I put it to the Chancellor that the fair way to look at the subjects to-night is to compare the position of the brewer to-day with the position of the brewer before the new duty was put on three years ago.

Taking that as an argument, and as a basis, I submit that 20s. rebate is too great. During the last three years the price of barley has fallen very heavily—nearly one-third. The price of other commodities used in the manufacture of beer have also fallen very rapidly. In addition to this, I press this point upon the Chancellor of the Exchequer, three years ago when the price was raised, his colleague in the Government at that time, speaking from the bench opposite, told the House that the brewers were making large profits and would willingly forego a share of those profits. In view of what happened three years ago, in view of the falling costs which have taken place, why single out this industry and enable it to increase its turnover very largely at the expense of the general taxpayer? I submit the brewers could well have taken a much larger share of the 24s. than 20s. that the Chancellor allows. I know full well it is difficult to analyse this position accurately. I have been reading this morning a pamphlet issued by a gentleman who sat in this House for several years, Mr. Arthur Sherwell, a gentleman well known to us, and one who has brought to bear upon this subject a knowledge and accuracy of judgment unequalled by any Member of this House for a good many years past. That pamphlet clearly reveals that whether the Beer Duty be raised or be dropped, whatever the extent of the Beer Duty, it always acts and has acted in the past in the interests of the brewer. In view of this large sum that the brewer is going to take out of the pockets of the taxpayers I suggest to the Chancellor of the Exchequer it would be well to circulate to Members of this House some accurate information on the subject. He has had an opportunity of discussing this subject with the brewers, the men who know this business accurately. The short time I have been able to direct my mind to the subject leads me to think that although it is a very difficult subject to probe to the bottom, yet the sum which the Chancellor of the Exchequer is asking the taxpayer to forego is not in keeping with the burden placed on other shoulders, and he could well in the present Budget not only lower the price of beer but do so at less expense to the general taxpayer.

Photo of Mr Robert Richardson Mr Robert Richardson , Houghton-le-Spring

In my view, it makes little or no difference to the consumer whether in regard to this duty the Government or the brewer has to pay. I think the brewer could pay more, and he ought to pay more. The point that has preyed upon my mind most is that I regret this proposal has come from the benches below the Gangway. I represent the miners here, and quite 75 per cent. of them drink beer. I deny, however, that 75 per cent. of them are wife-beaters or drunkards, because, as a matter of fact, they are really good and decent citizens. I quite agree that you should tax drink, but you should not tax the drink of the workers out of existence. I would prefer to vote for prohibition rather than vote for the proposal which has been put forward by my hon. Friend below the Gangway.

The workers have paid very dearly for the War in many ways, and no man has paid more in taxation in proportion than the man who drinks a glass of beer. Many times the tax on beer has been increased, and I would like to know what other article has been taxed so heavily. Remember, this tax falls entirely upon the working-class people of this country. I have heard the beer duty compared with the sugar duty, but I want it compared with the drink of the rich. Compare it with the wine consumed by the rich and see if it has been treated with anything like equality. Hon. Members below the Gangway say that no matter what happens, beer has not to be given any relief. Rightly or wrongly, beer is the national drink. When my hon. Friends are dealing with this matter, if they want to deal fairly with the working classes, let them think again before they commence in this way. There is another tax which may be compared with the duty on beer, and it is the Income Tax, and I would remind hon. Members below the Gangway that in this respect they have secured great relief. What has been given to the workers to balance that? Has anything at all been given? Surely my hon. Friends will not say that the reduction made in the Tea Duty last year did very much to help the workers. I am going to vote for all reductions of indirect taxation, because I believe that the more you reduce that form of taxation, the sooner you will have the wheels of industry going again.

I do not agree with the argument put forward by the Chancellor of the Exchequer last year, and by the present Chancellor of the Exchequer, that the reductions made in the Income Tax go ultimately into the pockets of the workers. What I do contend is that if you increase the purchasing power of money you will produce an additional amount of labour in this country. For these reasons I stand for this reduction. It is the business of the Chancellor of the Exchequer to find out if the brewer can pay more of this duty, and I think he ought to pay more, but I do not like to hear such remarks made about the class to which I belong as those which were made by the hon. Member for Dumfries (Dr. Chapple). As workers of this country, all we want is to be treated fairly when taxation is being reduced. I may say that when the hon. Member for Central Hull (Lieut.-Commander Kenworthy) moves his Amendment proposing a still further reduction of indirect taxation, I shall vote for it in the hope that all those hon. Members who wish to do the best they can for the worker will follow the hon. and gallant Member into the Division Lobby.

Photo of Mr William Pringle Mr William Pringle , Penistone

I do not wish to enter into the controversy which has arisen between the hon. Member who has just sat down and the hon. Member for Dumfries (Dr. Chapple). I am afraid the hon. Member who has just spoken has rather misunderstood the issue in regard to the statistics quoted by my hon. Friend.

Photo of Mr William Pringle Mr William Pringle , Penistone

I am not going to accept all the deductions which my hon. Friend made, but I wish to say that the hon. Gentleman who has just spoken has drawn a totally different conclusion from that which my hon. Friend wished to be drawn. So much for the side issue which has been raised. I wish to make one observation with regard to the reply given by the Chancellor of the Exchequer. The right hon. Gentleman accused those sitting in this part of the House of being anxious to put millions into the pockets of American millionaires rather than secure some relief for the British taxpayers. There could be no greater travesty of the facts than that. We have no desire to do anything to improve the position of profiteers either in America or anywhere else, and if at a later stage of the Finance Bill we propose a reduction of the Sugar Duty, as we shall do, I think we shall be able to show then that the argument of the right hon. Gentleman in relation to sugar is not as sound as he himself believes, and that by reducing the duty it will be possible to confer a benefit both on the working class consumer of sugar in this country and upon the industries of this country which use sugar. We are anxious to know what exactly is going to happen under the arrangement which the Chancellor has now, admittedly, made with the trade. I do not know whether a speech made in Birmingham by a gentleman in the licensed trade may be put in in the course of this Debate, but this gentleman said that the Chancellor had sent a message asking the brewers how much they could contribute towards a reduction in the price of beer to the consumer, and he said that until now they had never heard of a Chancellor inquiring of the taxpayer, "How much can you stand towards a reduction?" When we hear a statement of that kind we are naturally put on our inquiry as to the nature of the arrangement which has, in fact, been made.

The Chancellor has said that it is made by agreement, but a number of other people are involved in this agreement besides the brewers with whom in the first instance he has dealt. Has the Chancellor received any assurances from the brewers that under this agreement the position of the workers in the breweries will not be prejudiced? Has he any assurance that under this arrangement there is going to be no reduction of the wages paid in the breweries? I understand that a claim has already been made by the brewers that there should be a reduction of wages. If the brewers are going to recoup themselves by a reduction in wages, I do not think that that is a kind of arrangement to which this House is likely to assent. It is not, however, only a matter of the workers in the brewery trade; there is the question of what is going to be the position of the retailers. How are they going to be affected by this arrangement? On what terms are the brewers going to supply the beer to the retailers? There are both the tied houses and the free houses. When the Chancellor made an arrangement with the brewers, he should have had a firm bargain with them, relating alike to the position of the workers in the trade and to the retailers, and up to the present there is no indication that any safeguards have been secured for these two classes. I think the Chancellor will be called upon to offer some such security before he is able to obtain the passing of these provisions through this House.

Then I have another reason for looking at this matter with some suspicion. I want to know from the Chancellor of the Exchequer whether, apart from his negotiations with the trade, the Inland Revenue authorities have reached any figure independently. That is a very important question. The Inland Revenue authorities know all about this matter. It has been their business to watch the brewery trade for years, because beer has been one of the great sources of revenue in this country. You may say that ever since 1880 there has been no trade that has been more closely watched by the Inland Revenue than the beer trade. I have referred to the year 1880 intentionally. The Chancellor will remember that in 1880 the Malt Tax was abolished and a tax on beer substituted. In connection with Mr. Gladstone's alternative plan in regard to beer, a provision was put forward that the standard gravity should be 1055. That was in 1880. Mr. Gladstone put that forward on the basis of the views of the Inland Revenue Department. What happened in the course of the discussions? The trade, which was very powerful in the House then, as it still is, said that 1055 was not right, and that they required 1057, and, after long discussion, the Government of that day, under pressure, gave way and gave the trade the extra two degrees. What happened in 1885? The Inland Revenue authorities said that the experience of the intervening five years had proved that Mr. Gladstone was right, and that the trade was wrong, and, as a matter of fact, two years later, Mr. Goschen, when he was Chancellor of the Exchequer, had to alter the gravity from 1057 to 1055, the figure which Mr. Gladstone had originally proposed.

I say that it is important, in relation to this agreement, that we should know what view the Inland Revenue Department take—what independent advice they gave to the right hon. Gentleman before this agreement was entered into. We have had no explanation of these matters. The answer of the Chancellor has been of a most perfunctory character. He has dealt with none of the real, substantial issues which from time to time have been raised in the course of the Debate. In these circumstances, as the best method of protesting against this arrangement is the Amendment moved by the hon. and gallant Member for North Bristol (Colonel Guest), I hope that the House will, by a large Vote, show that, it distrusts the arrangement or agreement which has been made and is embodied in this Resolution, and that, on the later stages, it will insist on a much clearer and fuller explanation before it assents to it. I therefore support the Amendment.

Question put, "That the words 'one pound' stand part of the Resolution."

The House proceeded to a Division.

Photo of Mr William Pringle Mr William Pringle , Penistone

On a point of Order. May I call your attention, Sir, to the fact that 12 Members passed through the door after you had given instructions to lock the door on the other side.

Photo of Mr James Hope Mr James Hope , Sheffield Central

I gave instructions that the doors should be locked, and the doors are locked.

Photo of Mr William Pringle Mr William Pringle , Penistone

While the attendant was in process of locking the door, they forced the door open and pushed him aside.

Photo of Mr James Hope Mr James Hope , Sheffield Central

I cannot think that the attendants would allow themselves to be coerced by physical force.

Photo of Mr William Pringle Mr William Pringle , Penistone

Is it not in accordance with practice to ascertain from the attendants of the House whether what I have alleged actually was done?

Photo of Mr James Hope Mr James Hope , Sheffield Central

The matter will no doubt form the subject of inquiry, judicial or otherwise.

The House divided: Ayes, 252; Noes, 165.

Division No. 105.]AYES.[8.53 p.m.
Agg-Gardner, Sir James TynteCraig, Captain C. C. (Antrim, South)Herbert, S. (Scarborough)
Ainsworth, Captain CharlesCraik, Rt. Hon. Sir HenryHewett, Sir J. P.
Alexander, E. E. (Leyton, East)Croft, Lieut.-Colonel Henry PageHilder, Lieut.-Colonel Frank
Amery, Rt. Hon. Leopold C. M. S.Crook, C. W. (East Ham, North)Hiley, Sir Ernest
Archer-Shee, Lieut.-Colonel MartinDalziel, Sir D. (Lambeth, Brixton)Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Ashley, Lt.-Col. Wilfrid W.Davidson, J. C. C. (Hemel Hempstead)Hogg, Rt. Hon. Sir D. (St. Marylebone)
Astbury, Lieut.-Com. Frederick W.Davidson, Major-General Sir J. H.Hohler, Gerald Fitzroy
Astor, J. J. (Kent, Dover)Davies, Alfred Thomas (Lincoln)Hood, Sir Joseph
Baird, Rt. Hon. Sir John LawrenceDavison, Sir W. H. (Kensington, S)Hopkins, John W. W.
Baldwin, Rt. Hon. StanleyDawson, Sir PhilipHoward, Capt. D. (Cumberland, N.)
Balfour, George (Hampstead)Dixon, C. H. (Rutland)Howard-Bury, Lieut.-Col. C. K.
Banks, MitchellDoyle, N. GrattanHudson, Capt. A.
Barlow, Rt. Hon. Sir MontagueDu Pre, Colonel William BaringHughes, Collingwood
Barnett, Major Richard W.Edmondson, Major A. J.Hume, G. H.
Becker, HarryElliot, Capt. Walter E. (Lanark)Hume-Williams, Sir W. Ellis
Bell, Lieut.-Col. W. C. H. (Devizes)Ellis, R. G.Hurst, Lt.-Col. Gerald Berkeley
Bellairs, Commander Carlyon W.Erskine, James Malcolm MonteithHutchison, G. A. C. (Midlothian, N.)
Benn, Sir A. S. (Plymouth, Drake)Erskine, Lord (Weston-super-Mare)Hutchison, W. (Kelvingrove)
Berry, Sir GeorgeErskine-Bolst, Captain C.Inskip, Sir Thomas Walker H.
Betterton, Henry B.Eyres-Monsell, Com. Bolton M.James, Lieut.-Colonel Hon. Cuthbert
Birchall, Major J. DearmanFalcon, Captain MichaelJephcott, A. R.
Blades, Sir George RowlandFalle, Major Sir Bertram GodfrayJodrell, Sir Neville Paul
Blundell, F. N.Fawkes, Major F. H.Johnson, Sir L. (Walthamstow, E.)
Bowyer, Capt. G. E. W.Fermor-Hesketh, Major T.Jones, G. W. H. (Stoke Newington)
Boyd-Carpenter, Major A.Ford, Patrick JohnstonJoynson-Hicks, Sir William
Brass, Captain W.Foreman, Sir HenryKennedy, Captain M. S. Nigel
Brassey, Sir LeonardForestier-Walker, L.Kinloch-Cooke, Sir Clement
Bridgeman, Rt. Hon. William CliveFoxcroft, Captain Charles TalbotLamb, J. Q.
Briggs, HaroldFrece, Sir Walter deLane-Fox, Lieut.-Colonel G. R.
Brittain, Sir HarryFremantle, Lieut.-Colonel Francis E.Lloyd, Cyril E. (Dudley)
Brown, Major D. C. (Hexham)Furness, G. J.Lorden, John William
Brown, Brig.-Gen. Clifton (Newbury)Galbraith, J. F. W.Lorimer, H. D.
Bruton, Sir JamesGanzoni, Sir JohnLoyd, Arthur Thomas (Abingdon)
Buckingham, Sir H.Gates, PercyLumley, L. R.
Buckley, Lieut.-Colonel A.Gaunt, Rear-Admiral Sir Guy R.Macnaghten, Hon. Sir Malcolm
Burn, Colonel Sir Charles RosdewGoff, Sir R. ParkMcNeill, Ronald (Kent, Canterbury)
Burney, Com. (Middx., Uxbridge)Gray, Harold (Cambridge)Malone, Major P. B. (Tottenham, S.)
Butler, H. M. (Leeds, North)Grenfell, Edward C. (City of London)Manville, Edward
Butt, Sir AlfredGuinness, Lieut.-Col. Hon. W. E.Mason, Lieut.-Col. C. K.
Button, H. S.Gwynne, Rupert S.Mercer, Colonel H.
Campion, Lieut.-Colonel W. R.Hall, Lieut.-Col. Sir F. (Dulwich)Milne, J. S. Wardlaw
Cassels, J. D.Hall, Rr-Adml Sir W. (Liv'p'l, W. D'by)Mitchell, W. F. (Saffron Walden)
Cayzer, Sir C. (Chester, City)Halstead, Major D.Molloy, Major L. G. S.
Chamberlain, Rt. Hon. N. (Ladywood)Hamilton, Sir George C. (Altrincham)Molson, Major John Elsdale
Chapman, Sir S.Hannon, Patrick Joseph HenryMoore, Major-General Sir Newton J.
Churchman, Sir ArthurHarbord, ArthurMorden, Col. W. Grant
Clarry, Reginald GeorgeHarmsworth, Hon. E. C. (Kent)Morrison, Hugh (Wilts, Salisbury)
Clayton, G. C.Harrison, F. C.Morrison-Bell, Major A. C. (Honiton)
Cobb, Sir CyrilHarvey, Major S. E.Murchison, C. K.
Cockerill, Brigadier-General G. K.Hawke, John AnthonyNesbitt, Robert C.
Cohen, Major J. Brune[...]Hay, Major T. W. (Norfolk, South)Newman, Colonel J. R. P. (Finchley)
Colfox, Major Wm. PhillipsHayday, ArthurNewman, Sir R. H. S. D. L. (Exeter)
Cope, Major WilliamHenn, Sir Sydney H.Newson, Sir Percy Wilson
Cory, Sir J. H. (Cardiff, South)Hennessy, Major J. R. G.Newton, Sir D. G. C. (Cambridge)
Courthope, Lieut.-Col. George L.Herbert, Dennis (Hertford, Watford)Nicholson, Brig.-Gen. J. (Westminster)
Nicholson, William G. (Petersfield)Roberts, Rt. Hon. Sir S. (Ecclesall)Sugden, Sir Wilfrid H.
Nield, Sir HerbertRobertson-Despencer, Major (Isl'gt'n W.)Sykes, Major-Gen. Sir Frederick H.
Norton Griffiths, Lieut.-Col. Sir JohnRose, Frank H.Thompson, Luke (Sunderland)
O'Grady, Captain JamesRoundell, Colonel R. F.Thomson, F. C. (Aberdeen, South)
Oman, Sir Charles William C.Ruggles-Brise, Major E.Thorpe, Captain John Henry
Paget, T. G.Russell, Alexander West (Tynemouth)Titchfield, Marquess of
Parker, Owen (Kettering)Russell, William (Bolton)Tryon, Rt. Hon. George Clement
Pease, William EdwinRussell-Wells, Sir SydneyTubbs, S. W.
Pennefather, De FonblanqueSamuel, A. M. (Surrey, Farnham)Turton, Edmund Russborough
Penny, Frederick GeorgeSanders, Rt. Hon. Sir Robert A.Vaughan-Morgan, Col. K. P.
Percy, Lord Eustace (Hastings)Sanderson, Sir Frank B.Wallace, Captain E.
Perkins, Colonel E. K.Sandon, LordWard, Col. L. (Kingston-upon-Hull)
Perring, William GeorgeShaw, Thomas (Preston)Watson, Capt. J. (Stockton-on-Tees)
Peto, Basil E.Sheffield, Sir BerkeleyWatts, Dr. T. (Man., Withington)
Pielou, D. P.Shepperson, E. W.Wells, S. R.
Pilditch, Sir PhilipShipwright, Captain D.Weston, Colonel John Wakefield
Pownall, Lieut.-Colonel AsshetonSimms, Dr. John M. (Co. Down)Wheler, Col. Granville C. H.
Privett, F. J.Simpson-Hinchcliffe, W. A.White, Col. G. D. (Southport)
Raeburn, Sir William H.Skelton, A. N.Wilson, Col. M. J. (Richmond)
Raine, W.Smith, Sir Harold (Wavertree)Winterton, Earl
Rawlinson, Rt. Hon. John Fredk. PeelSomerville, A. A. (Windsor)Wise, Frederick
Rawson, Lieut.-Com. A. C.Somerville, Daniel (Barrow-in-Furness)Wolmer, Viscount
Reid, Capt. A. S. C. (Warrington)Sparkes, H. W.Wood, Sir H. K. (Woolwich, West)
Reid, D. D. (County Down)Spender-Clay, Lieut.-Colonel H. H.Wood, Major Sir S. Hill- (High Peak)
Remer, J. R.Stanley, LordWoodcock, Colonel H. C.
Rentoul, G. S.Steel, Major S. StrangYerburgh, R. D. T.
Reynolds, W. G. W.Stewart, Gershom (Wirral)
Rhodes, Lieut.-Col. J. P.Stott, Lt.-Col. W. H.TELLERS FOR THE AYES.—
Richardson, Sir Alex. (Gravesend)Strauss, Edward AnthonyColonel Leslie Wilson and Captain
Richardson, Lt.-Col. Sir P. (Chertsey)Sueter, Rear-Admiral Murray FraserDouglas King.
Roberts, Samuel (Hereford, Herefo[...]d)
NOES.
Adams, D.Greenwood, A. (Nelson and Colne)Marshall, Sir Arthur H.
Adamson, W. M. (Staff., Cannock)Grenfell, D. R. (Glamorgan)Middleton, G.
Alexander, Col. M. (Southwark)Groves, T.Millar, J. D.
Alexander, A. V. (Sheffield, Hillsbro')Guest, Hon. C. H. (Bristol, N.)Moreing, Captain Algernon H.
Ammon, Charles GeorgeGuthrie, Thomas MauleMorel, E. D.
Attice, C. R.Hall, G. H. (Merthyr Tydvil)Morris, Harold
Barker, G. (Monmouth, Abertillery)Hamilton, Sir R. (Orkney & Shetland)Morrison, R. C. (Tottenham, N.)
Barnes, A.Hancock, John GeorgeMosley, Oswald
Batey, JosephHardie, George D.Muir, John W.
Benn, Captain Wedgwood (Leith)Harney, E. A.Murnin, H.
Berkeley, Captain ReginaldHarris, Percy A.Murray, Hon. A. C. (Aberdeen)
Bonwick, A.Hastings, PatrickMurray, R. (Renfrew, Western)
Bowerman, Rt. Hon. Charles W.Hay, Captain J. P. (Cathcart)Newbold, J. T. W.
Briant, FrankHayes, John Henry (Edge Hill)Nichol, Robert
Broad, F. A.Hemmerde, E. G.Oliver, George Harold
Bromfield, WilliamHenderson, Rt. Hon. A. (N'castle, E.)Paling, W.
Brotherton, J.Henderson, Sir T. (Roxburgh)Phillipps, Vivian
Brown, James (Ayr and Bute)Henderson, T. (Glasgow)Philipson, Hilton
Buckie, J.Herriotts, J.Ponsonby, Arthur
Burnie, Major J. (Bootle)Hill, A.Potts, John S.
Butler, J. R. M. (Cambridge Univ.)Hogge, James MylesPrice, E. G.
Buxton, Charles (Accrington)Hutchison, Sir R. (Kirkcaldy)Pringle, W. M. R.
Cairns, JohnIrving, DanRichards, R.
Cape, ThomasJarrett, G. W. S.Riley, Ben
Chapple, W. A.John, William (Rhondda, West)Ritson, J.
Charleton, H. C.Johnston, Thomas (Stirling)Roberts, C. H. (Derby)
Clarke, Sir E. C.Johnstone, Harcourt (Willesden, East)Robinson, W. C. (York, Elland)
Clynes, Rt. Hon. John R.Jones, Henry Haydn (Merioneth)Royce, William Stapleton
Collins, Sir Godfrey (Greenock)Jones, Morgan (Caerphilly)Saklatvala, S.
Collison, LeviJones, R. T. (Carnarvon)Salter, Dr. A.
Cowan, D. M. (Scottish Universities)Jones, T. I. Mardy (Pontypridd)Sexton, James
Darbishire, C. W.Jowitt, W. A. (The Hartlepools)Shinwell, Emanuel
Davison, J. E. (Smethwick)Kelley, Major Fred (Rotherham)Sinclair, Sir A.
Duffy, T. GavanKenworthy, Lieut.-Commander J. M.Snell, Harry
Duncan, C.Kenyon, BarnetSnowden, Philip
Dunnico, H.Kirkwood, D.Spencer, George A. (Broxtowe)
Ede, James ChuterLansbury, GeorgeStephenson, Lieut.-Colonel H. K.
Edmonds, G.Lawson, John JamesStewart, J. (St. Rollox)
Emlyn-Jones, J. E. (Dorset, N.)Leach, W.Sturrock, J. Leng
England, Lieut.-Colonel A.Lee, F.Sullivan, J.
Entwistle, Major C. F.Lees-Smith, H. B. (Keighley)Thomas, Sir Robert John (Anglesey)
Fairbairn, R. R.Linfield, F. C.Thorne, G. R. (Wolverhampton, E.)
Falconer, J.Lowth, T.Trevelyan, C. P.
Foot, IsaacLunn, WilliamTurner, Ben
George, Major G. L. (Pembroke)MacDonald, J. R. (Aberavon)Wallhead, Richard C.
Gilbert, James DanielM'Entee, V. L.Walsh, Stephen (Lancaster, Ince)
Gosling, HarryMcLaren, AndrewWaring, Major Walter
Graham, W. (Edinburgh, Central)Maclean, Neil (Glasgow, Govan)Warne, G. H.
Gray, Frank (Oxford)Macnamara, Rt. Hon. Dr. T. J.Watson, W. M. (Dunfermline)
Greenall, T.March, S.Watts-Morgan, Lt.-Col. D. (Rhondda)
Webb, SidneyWilliams, David (Swansea, E.)Wright, W.
Weir, L. M.Williams, Dr. J. H. (Llanelly)Young, Robert (Lancaster, Newton)
Welsh, J. C.Williams, T. (York, Don Valley)
Westwood, J.Wilson, C. H. (Sheffield, Attercliffe)TELLERS FOR THE NOES.—
White, Charles F. (Derby, Western)Wilson, R. J. (Jarrow)Mr. Hilton Young and Sir William
White, H. G. (Birkenhead, E.)Wintringham, MargaretEdge.
Whiteley, W.Wood, Major M. M. (Aberdeen, C.)

Question put, "That this House doth agree with the Committee in the said Resolution."

The House divided: Ayes, 355; Noes, 62.

Division No. 106.]AYES.[9.3 p.m.
Adams, D.Collison, LeviHamilton, Sir R. (Orkney & Shetland
Adamson, W. M. (Staff., Cannock)Cope, Major WilliamHancock, John George
Adkins, Sir William Ryland DentCory, Sir J. H. (Cardiff, South)Hannon, Patrick Joseph Henry
Agg-Gardner, Sir James TynteCourthope, Lieut.-Col. George L.Harbord, Arthur
Ainsworth, Captain CharlesCraig, Captain C. C. (Antrim, South)Harmsworth, Hon. E. C. (Kent)
Alexander, E. E. (Leyton, East)Craik, Rt. Hon. Sir HenryHarris, Percy A.
Alexander, Col. M. (Southwark)Croft, Lieut.-Colonel Henry PageHarrison, F. C.
Amery, Rt. Hon. Leopold C. M. S.Crook, C. W. (East Ham, North)Harvey, Major S. E.
Archer-Shee, Lieut.-Colonel MartinDalziel, Sir D. (Lambeth, Brixton)Hawke, John Anthony
Ashley, Lt.-Col. Wilfrid W.Davidson, J. C. C. (Hemel Hempstead)Hay, Major T. W. (Norfolk, South)
Astbury, Lieut.-Com. Frederick W.Davidson, Major-General Sir J. H.Hayday, Arthur
Astor, J. J. (Kent, Dover)Davies, Alfred Thomas (Lincoln)Hemmerde, E. G.
Attlee, C. R.Davies, Rhys John (Westhoughton)Henderson, Rt. Hon. A. (N'castle, E.)
Baird, Rt. Hon. Sir John LawrenceDavison, J. E. (Smethwick)Henderson, Sir T. (Roxburgh)
Baldwin, Rt. Hon. StanleyDavison, Sir W. H. (Kensington, S.)Henn, Sir Sydney H.
Balfour, George (Hampstead)Dawson, Sir PhilipHennessy, Major J. R. G.
Banks, MitchellDixon, C. H. (Rutland)Herbert, Dennis (Hertford, Watford)
Barker, G. (Monmouth, Abertillery)Doyle, N. GrattanHerbert, S. (Scarborough)
Barlow, Rt. Hon. Sir MontagueDuncan, C.Herriotts, J.
Barnes, A.Dunnico, H.Hewett, Sir J. P.
Barnett, Major Richard W.Du Pre, Colonel William BaringHilder, Lieut.-Colonel Frank
Batey, JosephEde, James ChuterHiley, Sir Ernest
Becker, HarryEdge, Captain Sir WilliamHirst, G. H.
Bell, Lieut.-Col. W. C. H. (Devizes)Edmondson, Major A. J.Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Benn, Sir A. S. (Plymouth, Drake)Elliot, Capt. Walter E. (Lanark)Hogg, Rt. Hon. Sir D. (St. Marylebone)
Bennett, Sir T. J. (Sevenoaks)Ellis, R. G.Hohler, Gerald Fitzroy
Berry, Sir GeorgeEngland, Lieut.-Colonel A.Hood, Sir Joseph
Betterton, Henry B.Entwistle, Major C. F.Hopkins, John W. W.
Birchall, Major J. DearmanErskine, James Malcolm MonteithHoward, Capt. D. (Cumberland, N.)
Blades, Sir George RowlandErskine, Lord (Weston-super-Mare)Howard-Bury, Lieut.-Col. C. K.
Blundell, F. N.Erskine-Bolst, Captain C.Hudson, Capt. A.
Bonwick, A.Eyres-Monsell, Com. Bolton M.Hughes, Collingwood
Bowerman, Rt. Hon. Charles W.Fairbairn, R. R.Hume, G. H.
Bowyer, Capt. G. E. W.Falcon, Captain MichaelHume-Williams, Sir W. Ellis
Boyd-Carpenter, Major A.Falle, Major Sir Bertram GodfrayHurst, Lt.-Col. Gerald Berkeley
Brass, Captain W.Fawkes, Major F. H.Hutchison, G. A. C. (Midlothian, N.)
Brassey, Sir LeonardFermor-Hesketh, Major T.Hutchison, Sir R. (Kirkcaldy)
Bridgeman, Rt. Hon. William CliveFord, Patrick JohnstonHutchison, W. (Kelvingrove)
Briggs, HaroldForeman, Sir HenryInskip, Sir Thomas Walker H.
Brittain, Sir HarryForestier-Walker, L.Irving, Dan
Broad, F. A.Foxcroft, Captain Charles TalbotJackson, Lieut.-Colonel Hon. F. S.
Bromfield, WilliamFrece, Sir Walter deJames, Lieut.-Colonel Hon. Cuthbert
Brown, Major D. C. (Hexham)Fremantle, Lieut.-Colonel Francis E.Jarrett, G. W. S.
Brown, Brig.-Gen. Clifton (Newbury)Furness, G. J.Jenkins, W. A. (Brecon and Radnor)
Bruton, Sir JamesGalbraith, J. F. W.Jephcott, A. R.
Buchanan, G.Ganzoni, Sir JohnJodrell, Sir Neville Paul
Buckingham, Sir H.Gates, PercyJohn, William (Rhondda, West)
Buckle, J.Gaunt, Rear-Admiral Sir Guy R.Johnson, Sir L. (Walthamstow, E.)
Buckley, Lieut.-Colonel A.George, Major G. L. (Pembroke)Jones, G. W. H. (Stoke Newington)
Burgess, S.Gilbert, James DanielJones, T. I. Mardy (Pontypridd)
Burn, Colonel Sir Charles RosdewGoff, Sir R. ParkJowett, F. W. (Bradford, East)
Burney, Com. (Middx., Uxbridge)Gosling, HarryJoynson-Hicks, Sir William
Butler, H. M. (Leeds, North)Gray, Frank (Oxford)Kelley, Major Fred (Rotherham)
Butt, Sir AlfredGray, Harold (Cambridge)Kennedy, Captain M. S. Nigel
Button, H. S.Greenall, T.Kenworthy, Lieut.-Commander J. M.
Cairns, JohnGreenwood, A. (Nelson and Colne)Kenyon, Barnet
Campion, Lieut.-Colonel W. R.Grenfell, Edward C. (City of London)Kinloch-Cooke, Sir Clement
Cassels, J. D.Griffiths, T. (Monmouth, Pontypool)Lamb, J. Q.
Cayzer, Sir C. (Chester, City)Groves, T.Lambert, Rt. Hon. George
Cecil, Rt. Hon. Sir Evelyn (Aston)Grundy, T. W.Lane-Fox, Lieut.-Colonel G. R.
Chamberlain, Rt. Hon. N. (Ladywood)Guest, Hon. C. H. (Bristol, N.)Lansbury, George
Chapman, Sir S.Guest, J. (York, Hemsworth)Lawson, John James
Churchman, Sir ArthurGuinness, Lieut.-Col. Hon. W. E.Leach, W.
Clarry, Reginald GeorgeGwynne, Rupert S.Lloyd, Cyril E. (Dudley)
Clayton, G. C.Hall, Lieut.-Col. Sir F. (Dulwich)Lorden, John William
Clynes, Rt. Hon. John R.Hall, F. (York, W. R., Normanton)Lorimer, H. D.
Cobb, Sir CyrilHall, Rr-Adml Sir W. (Liv'p'l, W. D'by)Loyd, Arthur T. (Abingdon)
Cockerill, Brigadier-General G. K.Halstead, Major D.Lumley, L. R.
Colfox, Major Wm. PhillipsHamilton, Sir George C. (Altrincham)McCurdy, Rt. Hon. Charles A.
M'Entee, V. L.Raeburn, Sir William H.Stephen, Campbell
Macnaghten, Hon. Sir MalcolmRaine, W.Stewart, Gershom (Wirral)
Macnamara, Rt. Hon. Dr. T. J.Rawlinson, Rt. Hon. John Fredk. PeelStewart, J. (St. Rollox)
McNeill, Ronald (Kent, Canterbury)Rawson, Lieut.-Com. A. C.Stott, Lt.-Col. W. H.
Malone, Major P. B. (Tottenham, S.)Rees, Sir BeddoeStrauss, Edward Anthony
Manville, EdwardReid, Capt. A. S. C. (Warrington)Sturrock, J. Leng
Mason, Lieut.-Col. C. K.Reid, D. D. (County Down)Sueter, Rear-Admiral Murray Fraser
Maxton, JamesRemer, J. R.Sugden, Sir Wilfrid H.
Mercer, Colonel H.Rentoul, G. S.Sullivan, J.
Milne, J. S. WardlawReynolds, W. G. W.Sykes, Major-Gen. Sir Frederick H.
Mitchell, W. F. (Saffron Walden)Rhodes, Lieut.-Col. J. P.Thompson, Luke (Sunderland)
Molloy, Major L. G. S.Richardson, Sir Alex. (Gravesend)Thomson, F. C. (Aberdeen, South)
Molson, Major John ElsdaleRichardson, Lt.-Col. Sir P. (Chertsey)Thorne, W. (West Ham, Plaistow)
Moore, Major-General Sir Newton J.Richardson, R. (Houghton-le-Spring)Thorpe, Captain John Henry
Morden, Col. W. GrantRitson, J.Titchfield, Marquess of
Moreing, Captain Algernon H.Roberts, Samuel (Hereford, Hereford)Trevelyan, C. P.
Morris, HaroldRoberts, Rt. Hon. Sir S. (Ecclesall)Tryon, Rt. Hon. George Clement
Morrison, Hugh (Wilts, Salisbury)Robertson-Despencer, Major Isl'gt'n W.)Tubbs, S. W.
Morrison, R. C. (Tottenham, N.)Robinson, W. C. (York, Elland)Turner, Ben
Morrison-Bell, Major A. C. (Honiton)Rose, Frank H.Turton, Edmund Russborough
Mosley, OswaldRoundell, Colonel R. F.Vaughan-Morgan, Col. K. P.
Murchison, C. K.Royce, William StapletonWallace, Captain E.
Murnin, H.Ruggles-Brise, Major E.Wallhead, Richard C.
Nesbitt, Robert C.Russell, Alexander West (Tynemouth)Walsh, Stephen (Lancaster, Ince)
Newman, Colonel J. R. P. (Finchley)Russell, William (Bolton)Ward, Col. L. (Kingston-upon-Hull)
Newman, Sir R. H. S. D. L. (Exeter)Russell-Wells, Sir SydneyWaring, Major Walter
Newson, Sir Percy WilsonSamuel, A. M. (Surrey, Farnham)Watson, Capt. J. (Stockton-on-Tees)
Newton, Sir D. G. C. (Cambridge)Sanders, Rt. Hon. Sir Robert A.Watts, Dr. T. (Man., Withington)
Nicholson, Brig.-Gen. J. (Westminster)Sanderson, Sir Frank B.Watts-Morgan, Lt.-Col. D. (Rhondda)
Nicholson, William G. (Petersfield)Sandon, LordWells, S. R.
Nield, Sir HerbertSexton, JamesWeston, Colonel John Wakefield
Norton-Griffiths, Lieut.-Col. Sir JohnShaw, Thomas (Preston)Wheler, Col. Granville C. H.
O'Grady, Captain JamesSheffield, Sir BerkeleyWhite, Charles F. (Derby, Western)
Oman, Sir Charles William C.Shepperson, E. W.White, Col. G. D. (Southport)
Paget, T. G.Shipwright, Captain D.Whiteley, W.
Parker, Owen (Kettering)Short, Alfred (Wednesbury)Wilson, Col. M. J. (Richmond)
Parkinson, John Allen (Wigan)Simms, Dr. John M. (Co. Down)Wilson, R. J. (Jarrow)
Pease, William EdwinSimpson-Hinchcliffe, W. A.Winterton, Earl
Pennefather, De FonblanqueSkelton, A. N.Wise, Frederick
Penny, Frederick GeorgeSmith, Sir Harold (Wavertree)Wolmer, Viscount
Percy, Lord Eustace (Hastings)Smith, T. (Pontefract)Wood, Sir H. K. (Woolwich, West)
Perkins, Colonel E. K.Snell, HarryWood, Major Sir S. Hill- (High Peak)
Perring, William GeorgeSomerville, A. A. (Windsor)Woodcock, Colonel H. C.
Peto, Basil E.Somerville, Daniel (Barrow-in-Furness)Yerburgh, R. D. T.
Philipson, HiltonSparkes, H. W.Young, Rt. Hon. E. H. (Norwich)
Pielou, D. P.Spears, Brig.-Gen. E. L.Young, Robert (Lancaster, Newton)
Pilditch, Sir PhilipSpencer, George A. (Broxtowe)
Ponsonby, ArthurSpender-Clay, Lieut.-Colonel H. H.TELLERS FOR THE AYES.—
Pownall, Lieut.-Colonel AsshetonStanley, LordColonel Leslie Wilson and Captain
Price, E. G.Steel, Major S. StrangDouglas King.
Privett, F. J.Stephenson, Lieut.-Colonel H. K.
NOES.
Alexander, A. V. (Sheffield, Hillsbro')Henderson, T. (Glasgow)Paling, W.
Ammon, Charles GeorgeHill, A.Phillipps, Vivian
Benn, Captain Wedgwood (Leith)Hodge, Lieut.-Col. P. (Preston)Potts, John S.
Briant, FrankJohnstone, Harcourt (Willesden, East)Pringle, W. M. R.
Brotherton, J.Jones, Henry Haydn (Merioneth)Richards, R.
Brown, James (Ayr and Bute)Jones, Morgan (Caerphilly)Riley, Ben
Burnie, Major J. (Bootle)Jones, R. T. (Carnarvon)Roberts, C. H. (Derby)
Buxton, Charles (Accrington)Jowitt, W. A. (The Hartlepools)Shinwell, Emanuel
Cape, ThomasKirkwood, D.Snowden, Philip
Collins, Sir Godfrey (Greenock)Lee, F.Thomas, Sir Robert John (Anglesey)
Cowan, D. M. (Scottish Universities)Lees-Smith, H. B. (Keighley)Thorne, G. R. (Wolverhampton, E.)
Duffy, T. GavanLinfield, F. C.Warne, G. H.
Edmonds, G.Lowth, T.Watson, W. M. (Dunfermline)
Emlyn-Jones, J. E. (Dorset, N.)Lunn, WilliamWelsh, J. C.
Falconer, J.McLaren, AndrewWilliams, Dr. J. H. (Llanelly)
Foot, IsaacMarch, S.Williams, T. (York, Don Valley)
George, Major G. L. (Pembroke)Marshall, Sir Arthur H.Wilson, C. H. (Sheffield, Attercliffe)
Grenfell, D. R. (Glamorgan)Middleton, G.Wood, Major M. M. (Aberdeen, C.)
Hall, G. H. (Merthyr Tydvil)Millar, J. D.Wright, W.
Hardie, George D.Morris, Harold
Hay, Captain J. P. (Cathcart)Muir, John W.TELLERS FOR THE NOES—
Hayes, John Henry (Edge Hill)Murray, Hon. A. C. (Aberdeen)Mrs. Wintringham and Dr. Salter.

Fifth Resolution read a Second time.

Photo of Mr William Graham Mr William Graham , Edinburgh Central

I beg to move to leave out the word "twopence" and insert instead thereof the words "one penny."

The object of this Amendment is to secure a larger reduction in the duty on certain classes of sweetened table waters than that which the Chancellor of the Exchequer has agreed to concede. I trust that the House will bear with me while I summarise very briefly the history of this controversy and indicate the present position. There is probably no industry in this country that has suffered more severely by the taxation of recent years, and one that is more fully entitled to our sympathetic consideration. In the mineral water industry of Great Britain, I am informed, there is capital to the extent of £30,000,000 at stake. The wage bill of this industry is between £7,000,000 and £8,000,000 per annum. I am not able to give exact figures as to the number employed, but it is a very large number, and no doubt in the bottle trade and other allied industries very large numbers of people are also engaged.

In 1917, when it was necessary to obtain revenue from all kinds of sources in order to meet the acute needs of the war situation, these Table Water Duties were introduced on a comparatively heavy scale, for the purpose of dealing with what the Chancellor of the Exchequer then regarded as a kind of luxury expenditure. I ask hon. Members to consider carefully what has happened in this industry during the years in which this Act has been in operation. Within certain limits, having regard to the artificial prosperity of war conditions and then the depression which set in affecting all classes of the industrial community, we were bound to have a condition of affairs of that kind reflected in the experience of this industry, among others. But that is by no means a full explanation of the difficulties from which the trade has suffered. It was stated when the tax was first imposed that it would produce a revenue of approximately £2,000,000, but no such sum was ever obtained. The very highest sum obtained was in the neighbourhood of £1,500,000, and this has been steadily declining until last year the revenue was not much more than £1,000,000, and in the present year it is substantially lower than that sum.

During the time in which the tax has been in operation there has been a marked decline in the production of this useful commodity. In 1914 there were produced about 100,000,000 gallons of mineral waters in Great Britain. That production has been steadily decreasing until in the present year, according to very reliable estimates which have been taken, I am told that it may not amount to more than from 32,000,000 to 33,000,000 gallons. In other words, there has been a decline of nearly two-thirds in the output of the industry. During that time unemployment in the industry has increased very largely, and about one-third of the workers who were formerly engaged in it are now out of occupation, and only about one-third of the plant formerly in use is being used at the present time. The consumption is declining because of the very high prices at which it is necessary to sell the commodities, very largely because of the tax.

Last year representatives of the mineral water trade promoted an Amendment in this House for the abolition of the duty, their case being that unless the duty was abolished, it was practically hopeless to look for any improvement in the condition of the trade. At the same time an Amendment was promoted by some of my hon. Friends belonging to another party on this side, which aimed at the reduction of the duty rather than its abolition. On that occasion the Chancellor of the Exchequer was able to accept neither Amendment, and the tax was continued. Recently there was a deputation to the Treasury, and a statement was submitted by the right hon. Gentleman on Budget night, indicating that, looking at all the circumstances involved, he felt himself compelled to reduce the duty on sweetened table waters from 4d. to 2d., and that apparently was the limit of the concession which the Government could make at the present time. I do not want to be in any way ungrateful for a concession of that character, and though I have no claim to speak for this trade, they recognise fully the concession which the Chancellor of the Exchequer has made. But they are with regret compelled to point out that not even this reduction of one-half of the duty will meet the necessity, and that they must press for its abolition.

It is true that the Amendment on the Paper does not suggest abolition. We suggest that the rate of duty should be reduced to 1d., but as the Financial Secretary to the Treasury is aware, our case is for the abolition of the duty, and it is merely according to the forms of the House that we put the Amendment in this way. The raw materials of this industry are taxed very heavily. It so happens that with regard to the most important of the raw materials of the industry there is no sign of any concession in the present financial year. One of the most important of the raw materials is sugar, and that is taxed now to the extent of 25s. 8d. per cwt. That is a very heavy burden on a commodity so important for this mineral water industry, and not only is there no sign of a concession by the Chancellor of the Exchequer with regard to that commodity, but I think that there is a danger of a considerable rise in price. The rise which is now taking place may continue for a considerable time, so that there is no sign in that quarter of any relief for the mineral water industry.

The second rather important raw material in this industry is made up of the essences which the trade uses. I am told, by the people who understand the trade—of course, technically, I do not—that these essences require to be rendered soluble by the addition of the spirit which is very heavily taxed. There is no sign at the moment of any substantial reduction in the cost of that second raw material which this trade employs. Therefore, we can look for very little redress, so far as the raw materials of the industry are concerned. Hon. Members may ask us, when we are pleading for a reduction of this kind, whether the labour and capital involved in the industry have made all the sacrifices they might make towards a form of recovery which it is the common purpose to promote. As regards the labour, hon. Members will know that this is not a very well-organised trade, and that it is under Trade Board regulation. I think no hon. Member familiar with the rates of remuneration would suggest that they were other than low, having regard to all the circumstances of the time. As regards the capital, it is beyond dispute that the profits of the industry have very largely declined. Whereas there were about 3,000 manufacturers engaged in the mineral water trade in 1914, during the years since 1917 at least 500 have passed out of this industry, very largely because of the difficult condition which has been brought about.

It is clear, beyond a shadow of doubt, that both sides of the industry have made great sacrifices; that we cannot look for any redress at all in the raw materials employed, and that the difficulties have been coincident with the imposition of this tax since 1917, because the gallonage has very largely declined. On all those grounds we have a very firm foundation, not for the mere reduction of this duty on sweetened waters—after all, it is only one department, and the most difficult, which is at stake—but for the abolition of the duty. I cannot conclude without referring to a controversy which has undoubtedly been occasioned by a statement issued to the Press by one of the associations or sections of the trade, from which it would appear that, owing to the limited character of the reduction which the Chancellor was giving, it would be impossible for the trade to pass on any part of the benefit to the consumer. That announcement, as it was worded, in short paragraph form, appeared to me to be capable of the interpretation which some people put upon it, namely, that this was a flat refusal on the part of an industry, to which a concession had been given, to pass on any part of the benefit to the consumer. No such intention was entertained by the trade, and, in any case, the announcement in the Press was made by only one limited section of the industry, and is unrepresentative, if it be interpreted in that way, of the views of the industry as a whole.

The position which the mineral water trade takes up is this, that with the best will in the world, and with a desire to pass on the concession which has been given, the thing is a physical impossibility at the present time. I will try to prove that point by one or two simple illustrations. An actual concession of 2d. works out, in practice, at one-sixteenth penny upon a five-ounce bottle, and we require to come to a twenty-ounce bottle before we get a concession of four-sixteenths of a penny, or one farthing, which is the sum which hon. Members would say is one which would probably be passed on to the consumers of this commodity. Not even taking the large twenty ounce bottle, with a concession which works out at one farthing, can you pass this on to the consumer at the present time. I frankly state that that leads to a very difficult position. Hon. Members in various parts of the House will immediately say to me: "We understand that this concession, which the Chancellor of the Exchequer is making now, will mean £166,000, or something less, in the present financial year, and probably £175,000 in a full financial year." They would point to that concession, and say: "If you cannot pass it on to the consumer, then you had better withdraw the concession altogether." I feel perfectly sure the Chancellor of the Exchequer would never have resort to such a device, having regard to the very difficult conditions under which this industry suffers.

I have made it clear that the industry welcomes the reduction, and that, although there are very great technical difficulties in passing it on, they will do their very best with it. I want to remind hon. Members who have criticised this proposal in the past that very nearly the whole case for a reduction in the Table Water Duty in this country, as promoted by manufacturers, rests upon a lower range of price to the consumer of the article. They say: "We have made reductions in all other directions; we cannot do more. Certain things are fixed, but if you will give us a reduction in this taxation we think we shall be able to put this article on the market at a lower price, we shall raise the production of it in the times of recovering trade to which we are looking forward, and we shall be able to give the consumer a concession in that way." Unless the reduction be such as to make the fall in price a practicable proposal, it is quite clear that we shall not be giving this industry a fighting chance to carry out what has been its wish during the time this tax has been in operation.

Photo of Sir Kingsley Wood Sir Kingsley Wood , Woolwich West

Before the hon. Gentleman leaves that point—as he is speaking, I understand, on behalf of the trade—will he state definitely whether they intend to put the whole of this £175,000 into their pockets, or whether they are going to give any benefit to the consumer in respect of it?

Photo of Mr William Graham Mr William Graham , Edinburgh Central

I have been trying to deal with that point. I do not minimise the difficulties of the concession, as it has been given. I do not speak in any way on behalf of the trade, but only as an ordinary Member of this House, interested mainly, if I may say so, quite frankly, in the very serious unemployment in this industry. The trade will do their very best with the concession which has been given. They are very grateful for it, but a concession in this form places the trade in very serious difficulties, because of the technical problem, in making a real concession to the consumer.

It might be suggested that a certain relief could be obtained in a reduction of overhead, or cost, charges. Everyone who examines this trade will agree that everything possible has been done on that point. The deputation which met the Financial Secretary, at the Treasury, concluded with a very important argument in this connection. The position is, that the continuance of this duty is really the determining effect at the moment—it is the deciding issue—whether or not this trade will recover. All other factors have been met. If the duty could be abolished, the manufacturers, on their part, say that they would be willing to make the concession of 4d., which was proposed by the federation of the industry before the Budget was introduced. There would then be a foundation upon which recovery could be built. That is the case I put to the House to-night in support of the Amendment which I now move. I contend, looking to the fact that, after all, it is a very small revenue—a few hundred thousands at the most—which the Exchequer is getting out of this duty; that that duty is being imposed at the cost of continued unemployment in this trade; and that, probably, it is costing you more in unemployment donations than you are getting otherwise—on all these grounds it would be far better to give us the reduction asked for, or, when the Finance Bill comes to be introduced, to give us total abolition of the duty, without which no effective recovery can take place.

Photo of Mr James Sexton Mr James Sexton , St Helens

I beg to second the Amendment.

My task is somewhat easier because the Mover of the Amendment has dealt exhaustively with the main points. As has been said, this miserable concession does not touch the case at all; it provides no relief whatever, either to the manufacturers of mineral waters or to the manufacturers of glass bottles in this country. Think of the comparison. Eightpence per gallon is taken off beer, but only 2d. a gallon off mineral waters. The Consumers of mineral waters are probably as big a proportion of the population as those who consume beer, for mineral waters are not consumed exclusively by teetotallers. Some figures have been given. I will give others. I have been able to compile them with the assistance of those who are individually and collectively concerned. They are the figures of unemployment in my own constituency, not only in the mineral water manufacturing trade, but in the glass bottle manufacturing trade. The figures given to me by one firm in my constituency show that in pre-tax days the number of persons employed was 1,750, but since the tax was imposed, down to 1922, only 1,050 were employed. That is a difference of 700 men in one firm alone. I have ascertained that before the tax the employment of persons in the glass bottle industry in the whole country was about 66,000 persons. To-day there are not 30,000 people employed in the whole of the country in the making of glass bottles for mineral waters.

There is the other side of the question I have it on the best authority that bottles are being imported into this country from places on the continent where the cost of production is as high as it is in this country. Not long ago one of the biggest firms, Messrs. Schweppes, placed orders for 100,000 gross of bottles, which are to be delivered in this country at 6s. a gross less than the price at which the British manufacturer can produce them. Those bottles are to come from Czechoslovakia, where the hours and conditions of labour are equal to if not better than ours. But there is no tax and this enables them to import bottles at 6s. per gross less than we can make them. There has been no recovery in the British trade, and there cannot be any revival under this miserable concession by the Chancellor of the Exchequer. Twopence on the gallon means nothing; it leaves us where we are. Here is an opportunity for the Chancellor to remove an incubus that is crushing the workmen of this country. Surely, in face of these facts, something can be done. The only obstacle in the way of the British manufacturer competing with other manufacturers is the removal of this tax. If there is any foundation for the sympathy expressed on the other side of the House for the unemployed, surely it can be put to practical effect by the abolition of the tax, or by the reduction suggested in the Amendment.

Photo of Hon. Esmond Harmsworth Hon. Esmond Harmsworth , Isle of Thanet

I think that the Chancellor of the Exchequer has spread the remissions of taxation as far as possible over the greatest variety of interests. He has tried to relieve business and trade by the remission of Income Tax and Corporation Profits Duty, and to help the consumer by the reductions on the Beer Duties and on Mineral Waters Duties. I am sure the Chancellor would be the first to state that any reduction of taxation on commodities must find its way straight into the pockets of the consumer. Not only would he state so, but I think he must enforce it. If he does not do so in this case he will find it extremely difficult next year, when considering a reduction of the Sugar Duty and the taxes on other commodities—if he allows mineral water manufacturers not to pass the reduction on to the consumer, he will find it extremely difficult to stipulate that remissions of taxation should be passed to the consumer in other cases. In relation to the Beer Duty the Chancellor made sure, before he announced the reduction, not only that the consumers of beer were to get the full amount of the remission, but that the brewers would contribute something towards it. Apparently the manufacturers of mineral waters are not prepared to forego any of their profit in order to pass on to the consumer the benefit of the remission of duty.

I listened with great interest to the speech of the Mover of the Amendment. As I understand the Amendment, all the hon. Member asks for is a further reduction of 1d. He does not ask for the remission of the whole duty. Does he mean that if this further 1d. is allowed that the consumer will then receive the full benefit of the whole of the reduction? If he says that by a reduction of a further 1d. the consumer will get the benefit of the whole, it is a point which the Chancellor of the Exchequer should take into consideration. If, on the other hand, the consumer is not to get any further benefit or only a partial benefit, the only course for the House is to ask the Chancellor of the Exchequer to go back upon his Budget statement, as he has a perfect right to do, and not to have any reduction at all in the taxation on mineral waters. I think the right hon. Gentleman would have the House behind him if he did so, not because we do not wish to see a reduction in the taxation on mineral waters, but because it would point the moral that a reduction of taxation on any commodity should find its way into the pockets of the consumer in the speediest possible manner, at the moment when reduction takes place.

Photo of Mr Charles Ammon Mr Charles Ammon , Camberwell North

Nobody can quarrel with the statement that a reduction in taxation should, on the whole, go to the benefit of the consumer. As was explained by the hon. Member for Central Edinburgh (Mr. W. Graham), although the matter could not be raised in that form under the Rules of the House it was hoped that the Chancellor of the Exchequer would see his way to remit the whole of the taxation, the reason being that this particular industry has been declining at such a rapid rate that it is likely to be utterly extinct within a short time.

Photo of Hon. Esmond Harmsworth Hon. Esmond Harmsworth , Isle of Thanet

Is it not a fact that Messrs. Schweppes, in the balance sheet issued to-day, show a greater profit than last year.

Photo of Mr Charles Ammon Mr Charles Ammon , Camberwell North

I am afraid I cannot answer the hon. Member on that particular point. What I am concerned about is the general condition of the industry as I know it, and this particular industry happens to be the only one in my constituency. [Laughter.] It may be a laughing matter for some people, but it is a very serious matter to others. I know of small streets ocupied by people unemployed or only partly employed, through the gradual and steady decline of this trade, which from the year 1917 to the present year has declined by no less than 63 per cent. of its whole output. When this duty was put on as a War measure it was estimated that there would be an income of about £2,000,000, but in the peak year, 1918, it never reached more than £1,300,000. In the year in which it was introduced, sugar stood at £14 per cwt. It went up at a tremendous rate, and a little while ago stood at £140, and is now somewhere in the neighbourhood of £50 or £60. No trade in existence is taxed to such a degree both in raw material and in the finished product. We assumed that the right hon. Gentleman the Chancellor of the Exchequer has not seen all the bearings of the question, and that he would be prepared to give it further consideration.

As the hon. Member for St. Helens (Mr. Sexton) has indicated, the decline in this industry has had a serious effect on the glass bottle trade. There is one engineering firm in the north of England, the name of which I am prepared to give, which up to the year 1918 employed at least 70 people in manufacturing engines of the type used for this trade. They have now less than 12 persons engaged in that branch, and not one of them is employed on work for this particular industry. The point has been raised as to whether this remission of taxation should be passed on to the consumer. The reduction represents one-eighth of a penny for the half-pint, and the House will see how extremely difficult it will be to convey such a reduction to the consumer. I understand, from a letter which I received to-day, that the trade intend to do their best to see that this remission is given to the consumer. Those who have stated the contrary have spoken only for themselves and not for the trade as a whole, which has not yet met to consider the position. There has been, and is, a steady decline in the work of this trade, and not only is it heavily taxed as to raw material, but if one may judge by reports and possibilities, its chief raw material, sugar, looks like appreciating in price. The people connected with it are not able to bring the same pressure to bear as the licensed trade have brought to bear upon the Government, otherwise their position would be different. The licensed trade has suffered no diminution of profits during the past year yet they have had considerable relief in taxation. Even now I appeal to the Financial Secretary to take the matter back and give it reconsideration in view of the interests involved and of the comparatively small amount of revenue concerned, which must be accounted for over and over again by the unemployment pay and, indirectly, by the amount of relief given by guardians to the unemployed. These payments represent a tremendous amount in the Borough of Camberwell where so many people usually engaged in this trade are out of employment or only partly employed. If a stimulus were given to the trade and if the sugar price did not rise too much, we should save in this way more than the amount of the taxation. In view of the wave of unemployment not only in the trade itself but in subsidiary industries, I hope the Treasury will give a further remission.

Photo of Major Sir Archibald Boyd-Carpenter Major Sir Archibald Boyd-Carpenter , Bradford North

Life is full of little disappointments, and I am extremely disappointed that the concession given to the hon. Member for Central Edinburgh (Mr. W. Graham) on this particular point should have been greeted by him and by those with whom he is associated, with such scant gratitude. On the other hand, I recognise that gratitude is a lively sense of favours to come, and the hon. Member is anticipating something more than he originally demanded. I may point out to the Mover and Seconder of the Amendment that the cost of the reduction amounts to £160,000 in the year 1923–24, and in a full year to £175,000. I agree that in these days, when we think in millions and have no shillings ourselves to spend, that may be considered an inconsiderable sum, but, on the other hand, I may point out to the hon. Member for Central Edinburgh that if his Amendment were accepted it would involve something further, amounting to £130,000 a year more. It is not the day in which we can quite lightly give up sources of revenue, but it is equally true to say that this particular tax has been one of considerable investigation. The hon. Member for Central Edinburgh has rightly said that the Treasury has been interested in this for some time past, and there has been, and will be, a considerable amount of investigation. It is not quite as easy as some of my hon. Friends behind me seem to imagine, because there are other interests involved, and there is unquestionably bound up with it, under the peculiar circumstances that have arisen since the War, the question of unemployment, and there is the question, which we cannot get away from, that some of the ingredients necessarily used in this industry are already in themselves taxed, and taxed heavily.

Those are considerations which are generally beyond the purview of the ordinary discussions upon taxation, and if the hon. Member for Central Edinburgh and those with whom he is associated thing well, at the present moment, not to press this issue, I can assure him that my right hon. Friend the Chancellor of the Exchequer is prepared to go into the matter again and to consider the very definite points involved, without com- mitting himself in the slightest degree, because, after all, the whole point is in itself a point for the Committee stage of the Finance Bill. He is prepared to do that with the sincere desire to meet, if he can possibly do so, the wishes of those who have on many occasions so ably represented the views of this particular industry. I can say no more at the present moment, but to express the hope that after what I have said, it will not be considered necessary for the hon. Member for Central Edinburgh and those with whom he is working to insist upon this particular Amendment. I venture to think that the statement that I am allowed to make will probably meet his point, and that if he does not insist upon the Amendment, he probably might be able to have, shall I say, a more adequate consideration of his point than he would do if at this particular moment he pressed his point to a Division.

Photo of Mr William Graham Mr William Graham , Edinburgh Central

In view of the statement of the Parliamentary Secretary, I ask leave to withdraw the Amendment, and to thank him for the statement which he has made.

Amendment, by leave, withdrawn.

Photo of Mr Alfred Barnes Mr Alfred Barnes , East Ham South

I beg to move, to leave out the words in the case of the duties on dried fruits until the first day of August, nineteen hundred and twenty-three, and. 10.0 P.M.

I should be grateful if the hon. and gallant Member who represents the Treasury would extend the same generosity towards this Amendment dealing with relief in the dried fruit duties as he did towards the last Amendment. The duties on dried fruits press in a very hard degree upon an important food of the masses of the people. In addition, the sum received for them by the Exchequer in the way of revenue is not, I suggest, of sufficient importance in itself to interfere with the full financial statement of the Budget. In the years in which additional taxation has been imposed on these particular commodities, it will be found that they have had the net effect of reducing the consumption of dried fruits. In 1916 an addition to these particular duties was imposed, with the result that, although it secured in that particular year and the subsequent year some increase of revenue, it was followed in subsequent years by a reduction in consumption. The same thing prevailed in 1920, and I submit that at the present time, when the wages of the mass of the people have been reduced, and when their standard of living has been seriously interfered with, the tax on dried fruits should be removed. I think we are entitled to assert that when one compares the retention of a duty of this description with the relief of taxation given in the form of a lower Income Tax, and even in reduced Beer Duty, one can certainly suggest with some measure of truth that this Budget has not been framed with a view to giving real and effective benefit to the mass of the people of this country.

As a matter of fact, if one reviews the relief of taxation over the past two years, one finds that over £90,000,000 has been given in a direct form of relief to the rich and comfortable people of our nation, and that only £22,000,000 has been given to the relief of indirect taxation, and of this £22,000,000 only £5,500,000 directly affects the food supply of the people. In other words, what with reductions in wages, the increase of hours of labour, unemployment, short time, and unfair taxation, I think the request we are now making to the Chancellor of the Exchequer for the abolition of the dried fruit duties is a reasonable request indeed. It involves a sum of, approximately, £750,000. If the Chancellor of the Exchequer concedes the whole of these duties, it will not seriously affect his Budget for the next financial year, and yet dried fruits are a valuable food commodity that is available to a considerable extent for the poorer section of the community, who very seldom—in fact, never—can afford the more expensive fruits. It is an extraordinary factor with regard to the dried fruit duties that currants, which were largely and mostly consumed by working people, show a direct decline in consumption since the increase in the duty, but the more expensive types of fruit, many of them beyond the reach of the poorest section of the working classes, show an increase in consumption despite the increased duty. My case is strengthened when one compares the incidence of taxation in this country. We have heard a lot on this Budget and in the Budget Debate last year of the necessity for reducing the Income Tax because such reduction, it is said, benefits trade. I want directly to challenge that statement. If Income Tax benefits trade, why is not trade better now than it was 12 months ago? The relief of £50,000,000 to the Income Taxpaying class in this country has not materially improved trade. I challenge any Member to put his finger on one incident where that reduction has improved trade to any extent in this country. There are still 1,500,000 of men and women uneemployed. In addition, the wealthy people of this country get it both ways. As far as revenue is concerned, 36 per cent. of the revenue last year came in the form of Income Tax and Super-tax, but, while they paid 36 per cent. of the revenue, the payment of interest on the National Debt absorbed 37 per cent. of the expenditure of the country. This means that while the Income Tax-paying section paid to the revenue 36 per cent. they took out of the expenditure 37 per cent. But when we pass to the revenue obtained by indirect taxation, we find that the duty on beer, food, tobacco and other forms of indirect taxation raises, approximately, 27½ per cent. of the revenue of the country.

Photo of Mr John Whitley Mr John Whitley , Halifax

This will come on the Second Reading of the Finance Bill. When we are dealing with the Report stage we deal with each separate duty one by one, and the hon. Member must confine himself for a moment to questions relating to dried fruits.

Photo of Mr Alfred Barnes Mr Alfred Barnes , East Ham South

I regret if I was out of order. My remarks were directed to making an appeal to the Chancellor of the Exchequer as to the definite and reasonable claims that this form of indirect taxation has anon his consideration. In comparing the revenue supplied by indirect taxation with direct taxation I was endeavouring to strengthen my argument. If I may refer once more to the dried fruit commodities, my whole case is based upon the fact that the revenue raised from this particular tax on dried fruits does not secure a very big sum in revenue. The whole could be conceded without seriously disturbing the financial statement. It is a remission of indirect taxation which would give some little luxury which at the present moment is very necessary in working class homes in view of their reduced wages, and a remission of this description would bring a great variety of food on the working man's table. It is a food that is healthy and which tends to strengthen physical power. Therefore I appeal to the Chancellor of the Exchequer to accept this Amendment, which will confer this great benefit on the working classes.

Photo of Mr Ben Turner Mr Ben Turner , Batley and Morley

I wish to make a similar appeal to that which has been made by my hon. Friend the Member for East Ham South (Mr. Barnes). I come from a very old-fashioned county with old-fashioned ways. When I went to the mills 50 years ago, the mill lads went with their breakfast cans in their hands and their breakfast food under their arms, and the usual food at that time for a growing lad was a currant teacake. [HON. MEMBERS: "And very good, too!"] If they are so good, do not tax them. That is the message I want to give to my hon. Friend on the Treasury Bench. It was my privilege yesterday, as a Yorkshire man, to visit an old-fashioned Yorkshire home. At the tea table there was the usual Yorkshire hospitality, which cannot be beaten in any part of the world. What was the fare set before us last evening? It was the usual home-made bread with some decent home-made butter. Then there was the usual bit of Yorkshire cake. It is because I know these things are delightful in middle-class homes, and are usual at their afternoon tea and social gatherings, that I want the same delicacies to be allowed to be untaxed for our working folks. It is coming to Whitsuntide, and I can remember many Whitsuntides and Sunday school feasts. What was the usual Sunday school feast, Mr. Speaker, in your own county? It was the usual Whitsuntide bun. What was that Whitsuntide bun made from? First-class flour, with plenty of currants in it and a bit of sugar, and the joy of playing in the fields was enhanced when we knew we were to receive those buns. There has been a great limitation of these buns in recent days, because the taxes have disturbed even our Sunday school feasts on Whit Monday. We have freed a great sum of money to Income Tax payers, we have freed a fair sum to the brewers, we have freed a great sum for Corporation Profits taxpayers. The multitude use dry fruits. You have not taken anything off "pop" yet, and "pop" is the working-class drink. For the working-classes it is "pop" and cockles, just as with the upper classes it is champagne and oysters. The multitude are the people who enjoy the dried fruits. Any tax upon our foods ought to be abolished as speedily as possible. The Chancellor of the Exchequer has given help to everybody except the multitude, and my appeal to the right hon. Gentleman—another Yorkshireman—is to remove taxes on dried fruit, and let the bairns have a good Whitsuntide.

Photo of Mr Albert Alexander Mr Albert Alexander , Sheffield, Hillsborough

I want to support this Amendment, because we have, in the distribution of foodstuffs, plenty of evidence as to how taxes of this kind are bearing upon the working-class consumers of this country. I have here some figures which may be interesting to hon. Members with regard to a number of foodstuffs. According to the Co-operative Wholesale Society, during the last three years the percentage of this tax has become an increasing burden, because the values have been dropping, while the tax has remained the same. In 1920, the percentage of tax on the turnover with regard to dried fruits was 5.3 per cent. In 1921, it was 6 per cent., and in 1922 nearly 7 per cent. I want to draw attention to this fact, that the taxes on these foodstuffs have remained exactly the same, although prices have dropped, and the wages of the workers have dropped. These taxes, therefore are becoming an increasing burden upon the workers with their reduced incomes.

Taking a much larger range of taxes from the same source, I find that with regard to sugar, tea, coffee, cocoa and dried fruits, with the addition of tobacco, in 1920 the percentage of tax upon the workers of this country was 28.04 per cent.; in 1921 it was 37.77 per cent., and in 1922 it was 41.94 per cent. Therefore, when the income tax was at its highest in 1920 the burden upon the consumers of this country was only 28.04 per cent. Last year you gave a considerable reduction of Income Tax, and you propose this year to give a further reduction of Income Tax, and a reduction of the Corporation Profits Tax, though the percentage of indirect taxation last year was 41 per cent., compared with 28 per cent. in 1920. I say that it is an overwhelming case for the reduction of a tax of this kind which is bearing so hardly upon working-class consumers. Moreover, those who are acquainted with working-class homes know full well, although my hon. Friend has put it in his well-known humorous fashion, that these things are of vital interest to working-class homes.

I was speaking in the South of England last year, and, in the course of the meeting, a question was asked me by an unemployed working man, and after I had answered his question, he said, "Do you know that, week in and week out, because of the large family I have to maintain upon the dole, the principal midday meal for our family is duff, with a few raisins or currants thrown in?" On every one of those duffs they had to pay taxation of this sort out of the dole or poor relief that they were receiving. Surely hon. Members who desire—and, perhaps, rightly desire—a decrease in other taxes, are not going to be sufficiently hard-hearted to maintain a tax of that sort upon unemployed workers, and those who are forced to seek Poor Law relief to keep body and soul together. Moreover, you have the evidence of the medical profession that these fruits form the ingredients of puddings, cakes and so on, which are a real advantage to the children. While hon. Members may think it is a small point, we on this side think it is a very big point, for we want to free the food of the children from taxes which increase the cost and lessen the amount available for them. I hope the House will accept this Amendment.

Photo of Dr William Chapple Dr William Chapple , Dumfriesshire

The fruit diet of the rich is fresh and very dear, the fruit diet of the poor is preserved fruit and should be cheap. I think there is some argument in the Amendment so ably moved and seconded in favour of this concession. Now that the hon. and gallant Gentleman the Parliamentary Secretary has learnt the lesson taught him the other night, that it is better to yield to argument and justice than to yield to riot—[HON. MEMBERS: "Oh!"] That is a perfectly legitimate observation. Now that the hon. and gallant. Gentleman has been so conciliatory as to make a concession on the last Amendment, and so save—

Photo of Dr William Chapple Dr William Chapple , Dumfriesshire

The observation of my hon. Friend does not indicate that what we have already seen in this House has risen, in his opinion, to the dignity of a riot. That being so, I dread what may satisfy him in the future. No doubt, he has in mind that if the concessions are not made by the Government to the homes of the poor, he will show this House what is a riot. I was proceeding to say that the Parliamentary Secretary, making a concession a few moments ago—

Photo of Mr George Lansbury Mr George Lansbury , Poplar Bow and Bromley

On a point of Order. Is an hon. Member in order in inciting other hon. Members to make a riot?

Photo of Mr John Whitley Mr John Whitley , Halifax

I must confess that I think the observation of the hon. Member was an attempt at humour.

Photo of Dr William Chapple Dr William Chapple , Dumfriesshire

I am glad, Mr. Speaker, that you have given an indication that you can appreciate humour when it comes from over the Border. I strongly support this Amendment. I think it is a very, very serious question. The limitation of the diet of the poor is due to the grave, serious, and burdensome taxation. It is a very, very serious problem to the people generally who are suffering to-day because of the cost of living. The health of the children is suffering to-day because of the cost of living. The first, most obvious, and the simplest way of reducing the cost of living to to reduce taxation on the things that the poor require to keep up to a proper standard. You cannot afford to allow the burden to continue which the women and children of this country are enduring to-day. There is nothing more necessary to health than a fruit diet. The way to supply fruit to the homes of the poor that can be seen upon the tables of the rich is to exempt the dried and preserved fruits that enter so largely into the humble diet of the poor. I hope the hon. and gallant Gentleman will find it in his heart to make this concession, not to consumers of luxuries which people can avoid or leave alone, but in taxes that cannot be escaped and are burdensome upon the poor. Here is an article of diet which the poor are bound to consume in order to maintain their health and nutrition. I appeal to the hon. and gallant Gentleman to make this very simple concession asked for by the Amendment.

Photo of Major Sir Archibald Boyd-Carpenter Major Sir Archibald Boyd-Carpenter , Bradford North

An appeal has been made to my kindness of heart. I am sure that I should be willing to respond to any appeal of that nature were it not that owing to the position I occupy, my heart, which is naturally a kind one, has been turned into a heart of stone. What we are really discussing on this Amendment is the old question of the retention or repeal of the duty on dried fruits. From what has been said to-night, it would appear to me—I may have a very incorrect impression—that there is a general idea that there is a general tax on all dried fruits, but that is not so. Hon Members will recollect the origin of this tax was a Resolution by Mr. Gladstone in 1860, when he abolished all the taxes on fresh fruits imported into this country, and upon all forms of dried fruits so imported except four, namely, currants, raisins, figs and plums. The curious part of this Debate is that the expressions I have just listened to from the hon. Member for East Ham South (Mr. Barnes) and the hon. Member for Batley (Mr. Turner) have been directed towards the question of currants, which could not be affected by the Amendment before the House.

While the revenue from dried fruits amounts to £800,000 a year, of which £110,000 is derived from currants, there is not the same opportunity of reducing that impost upon currants as there was before 1890. In that year this country entered into an agreement with the Greek Government under which there was placed upon currants sent to this country a reduced duty of 2s. per cwt. That prevailed when the War broke out, and Mr. McKenna in 1915 was unable to vary the existing impost, nor can the present Chancellor of the Exchequer do so without notice to Greece, because of the existence of that agreement which was made in 1890. Therefore, the question of currants does not arise, and what we are now concerned with is simply raisins, fige and plums. It has been said by the hon. Member for Hillsborough (Mr. A. V. Alexander) that really we ought to look upon this from the food tax point of view. Is the hon. Member really going to press that point seriously?

Photo of Major Sir Archibald Boyd-Carpenter Major Sir Archibald Boyd-Carpenter , Bradford North

The average amount of dried fruits except currants consumed per person per year amounts to 3 lbs. The tax as it will work out under the existing form of taxation is ½d. per lb. Therefore the whole burden of taxation that could possibly arise through the retention of this tax is 1½d. per person per annum.

Photo of Mr Ben Turner Mr Ben Turner , Batley and Morley

Then you lose nothing by giving it away.

Photo of Major Sir Archibald Boyd-Carpenter Major Sir Archibald Boyd-Carpenter , Bradford North

The cost is 1½d. per annum per person. Therefore, it is, surely, straining the meaning of words to suggest that this is an intolerable burden.

Photo of Mr Albert Alexander Mr Albert Alexander , Sheffield, Hillsborough

Not in the case of persons living below the poverty line.

Photo of Major Sir Archibald Boyd-Carpenter Major Sir Archibald Boyd-Carpenter , Bradford North

Surely the hon. Gentleman is not going to say that the imposition or retention of this tax, amounting to 1½d. per person per annum, will reduce the condition of these people who are less well off in this world to the breaking point?

Photo of Mr David Kirkwood Mr David Kirkwood , Dumbarton District of Burghs

It is always the last straw that breaks the camel's back.

Photo of Major Sir Archibald Boyd-Carpenter Major Sir Archibald Boyd-Carpenter , Bradford North

Surely there are many other last things that will not only break the camel's back, but reduce people to conditions in which we do not like to see them, but it is really, if I may say so, absurd to make this claim; and yet the revenue is a considerable one, and one that we feel justified in retaining, because, after all, the hardship is absolutely out of all proportion individually to the amount of revenue received. We venture to think that there is really no substance in this Amendment. It does not affect currants, to which the hon. Members have referred, but merely refers to raisins, figs, and plums. We think that these duties should be retained, inasmuch as they do not inflict any injustice or hardship, if considered from a broad point of view, upon any section of the community, and I venture to think that that will commend itself to, shall I say, the non-political and more personal point of view of every hon. Member of this House.

Photo of Mr Richard Wallhead Mr Richard Wallhead , Merthyr Tydfil Merthyr

It may be, as the hon. and gallant Gentleman has told us, that the individual tax, so far as dried fruits are concerned, is inconsiderable in amount, but one has to consider the cumulative effect of a number of small taxes of a like kind. We on these benches are not only trying to reduce the tax on dried fruits, but we also want to remove the taxes on coffee, cocoa, and other articles of working-class diet. We have tried to reduce the tax on tea, and have failed there. If this sum is so inconsiderable as the hon. and gallant Gentle- man says, why not take it off? Viewing the Budget as a whole, it seems to me a particularly mean kind of Budget. It relieves rich people in all directions, but it gives little or no relief to the poorest of the poor. It is all very well to turn up one's nose at 1½d. per head of the population, but one has to consider that we have in this country a number of people whose poverty deepens from day to day. We make very small contributions at the present moment to the relief of the unemployed man—[HON. MEMBERS: "Oh!"]—in this present Budget. [HON. MEMBERS: "Oh!"] I say they are inconsiderable. [An HON. MEMBER: "The biggest in the world."] It does not matter. We are the richest country in the world. [HON. MEMBERS: "Oh!"] We claim to be. [HON. MEMBERS: "No!"] You do when it suits your purpose.

There is another point. We have a large number of pensioners who are not over well pensioned, and, out of the poverty of these poor people, a number of small and petty taxes filch from them

in all directions, and the utmost relief you can give them is something that will come to them indirectly by remitting your Income Tax. I am quite convinced that the average man would prefer to have relief directly to himself, and not relief given vicariously through you. Our contention is, that these taxes, small as they are, ought to be removed along with other taxes. So far as this direct taxation is concerned, the poorer a man is the larger percentage of his income he pays away in taxation. You tax him on his tea. He is compelled to buy the cheapest and poorest kind of commodity, and the poorer he is the more you tax him in proportion to the thing he purchases. Therefore I support the plea for a reduction, however small, of this petty kind of taxation. We will take every opportunity we can of removing every small item until the various small items amount to some commendable relief.

Question put, "That the words proposed to be left out stand part of the Resolution."

The House divided: Ayes, 249; Noes, 190.

Division No. 107.]AYES.[10.37 p.m.
Agg-Gardner, Sir James TynteCassels, J. D.Foxcroft, Captain Charles Talbot
Ainsworth, Captain CharlesCayzer, Sir C. (Chester, City)Furness, G. J.
Alexander, E. E. (Leyton, East)Cecil, Rt. Hon. Sir Evelyn (Aston)Galbraith, J. F. W.
Amery, Rt. Hon. Leopold C. M. S.Chamberlain, Rt. Hon. N. (Ladywood)Ganzoni, Sir John
Archer-Shee, Lieut.-Colonel MartinChapman, Sir S.Gates, Percy
Ashley, Lt.-Col. Wilfrid W.Churchman, Sir ArthurGaunt, Rear-Admiral Sir Guy R.
Astbury, Lieut.-Com. Frederick W.Clarry, Reginald GeorgeGoff, Sir R. Park
Astor, J. J. (Kent, Dover)Clayton, G. C.Gray, Harold (Cambridge)
Baird, Rt. Hon. Sir John LawrenceCobb, Sir CyrilGreene, Lt.-Col. Sir W. (Hack'y, N.)
Baldwin, Rt. Hon. StanleyCockerill, Brigadier-General G. K.Grenfell, Edward C. (City of London)
Balfour, George (Hampstead)Colfox, Major Wm. PhillipsGwynne, Rupert S.
Banks, MitchellCope, Major WilliamHall, Lieut.-Col. Sir F. (Dulwich)
Barlow, Rt. Hon. Sir MontagueCory, Sir J. H. (Cardiff, South)Hall, Rr-Adml Sir W. (Llv'p'l, W. D'by)
Barrett, Major Richard W.Courthope, Lieut.-Col. George L.Halstead, Major D.
Becker, HarryCraig, Captain C. C. (Antrim, South)Hamilton, Sir George C. (Altrincham)
Bell, Lieut.-Col. W. C. H. (Devizes)Craik, Rt. Hon. Sir HenryHannon, Patrick Joseph Henry
Benn, Sir A. S. (Plymouth, Drake)Croft, Lieut.-Colonel Henry PageHarmsworth, Hon. E. C. (Kent)
Bennett, Sir T. J. (Sevenoaks)Crook, C. W. (East Ham, North)Harrison, F. C.
Berry, Sir GeorgeCurzon, Captain ViscountHarvey, Major S. E.
Betterton, Henry B.Davidson, J. C. C. (Hemel Hempstead)Hawke, John Anthony
Birchall, Major J. DearmanDavidson, Major-General Sir J. H.Hay, Major T. W. (Norfolk, South)
Blades, Sir George RowlandDavies, Alfred Thomas (Lincoln)Henn, Sir Sydney H.
Blundell, F. N.Davison, Sir W. H. (Kensington, S.)Hennessy, Major J. R. G.
Bowyer, Capt. G. E. W.Dawson, Sir PhilipHerbert, Dennis (Hertford, Watford)
Boyd-Carpenter, Major A.Dixon, C. H. (Rutland)Herbert, S. (Scarborough)
Brass, Captain W.Doyle, N. GrattanHewett, Sir J. P.
Brassey, Sir LeonardDu Pre, Colonel William BaringHilder, Lieut.-Colonel Frank
Bridgeman, Rt. Hon. William CliveEdmondson, Major A. J.Hiley, Sir Ernest
Briggs, HaroldElliot, Capt. Walter E. (Lanark)Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Brittain, Sir HarryEllis, R. G.Hogg, Rt. Hon. Sir D. (St. Marylebone)
Brown, Major D. C. (Hexham)Erskine, James Malcolm MonteithHohler, Gerald Fitzroy
Bruton, Sir JamesErskine, Lord (Weston-super-Mare)Holbrook, Sir Arthur Richard
Buckingham, Sir H.Erskine-Bolst, Captain C.Hood, Sir Joseph
Buckley, Lieut.-Colonel A.Eyres-Monsell, Com. Bolton M.Hopkins, John W. W.
Burn, Colonel Sir Charles RosdewFalcon, Captain MichaelHopkinson, A. (Lancaster, Mossley)
Burney, Com. (Middx., Uxbridge)Falle, Major Sir Bertram GodfrayHoward, Capt. D. (Cumberland, N.)
Butcher, Sir John GeorgeFawkes, Major F. H.Howard-Bury, Lieut.-Col. C. K.
Butler, H. M. (Leeds, North)Fermor-Hesketh, Major T.Hudson, Capt. A.
Butt, Sir AlfredFord, Patrick JohnstonHughes, Collingwood
Button, H. S.Foreman, Sir HenryHume, G. H.
Campion, Lieut.-Colonel W. R.Forestier-Walker, L.Hurst, Lt.-Col. Gerald Berkeley
Hutchison, G. A. C. (Midlothian, N.)Nicholson, William G. (Petersfield)Shepperson, E. W.
Inskip, Sir Thomas Walker H.Nield, Sir HerbertShipwright, Captain D.
Jackson, Lieut.-Colonel Hon. F. S.Norton-Griffiths, Lieut.-Col. Sir JohnSimpson-Hinchcliffe, W. A.
James, Lieut.-Colonel Hon. CuthbertOman, Sir Charles William C.Skelton, A. N.
Jephcott, A. R.Paget, T. G.Smith, Sir Harold (Wavertree)
Jodrell, Sir Neville PaulParker, Owen (Kettering)Somerville, A. A. (Windsor)
Johnson, Sir L. (Walthamstow, E.)Pease, William EdwinSparkes, H. W.
Joynson-Hicks, Sir WilliamPennefather, De FonblanqueSpender-Clay, Lieut.-Colonel H. H.
Kelley, Major Fred (Rotherham)Penny, Frederick GeorgeStanley, Lord
Kennedy, Captain M. S. NigelPercy, Lord Eustace (Hastings)Steel, Major S. Strang
Kinloch-Cooke, Sir ClementPerkins, Colonel E. K.Stewart, Gershom (Wirral)
Lamb, J. Q.Peto, Basil E.Stott, Lt.-Col. W. H.
Lane-Fox, Lieut.-Colonel G. R.Pielou, D. P.Sueter, Rear-Admiral Murray Fraser
Leigh, Sir John (Clapham)Pilditch, Sir PhilipSugden, Sir Wilfrid H.
Lloyd, Cyril E. (Dudley)Pownall, Lieut.-Colonel AsshetonSykes, Major-Gen. Sir Frederick H.
Lorimer, H. D.Privett, F. J.Thompson, Luke (Sunderland)
Lougher, L.Raeburn, Sir William H.Thomson, F. C. (Aberdeen, South)
Loyd, Arthur T. (Abingdon)Raine, W.Thorpe, Captain John Henry
Lumley, L. R.Rankin, Captain James StuartTitchfield, Marquess of
Macnaghten, Hon. Sir MalcolmRawlinson, Rt. Hon. John Fredk. PeelTryon, Rt. Hon. George Clement
McNeill, Ronald (Kent, Canterbury)Rawson, Lieut.-Com. A. C.Tubbs, S. W.
Malone, Major P. B. (Tottenham, S.)Reid, Capt. A. S. C. (Warrington)Turton, Edmund Russborough
Manville, EdwardReid, D. D. (County Down)Vaughan-Morgan, Col. K. P.
Margesson, H. D. R.Remer, J. R.Wallace, Captain E.
Mason, Lieut.-Col. C. K.Rentoul, G. S.Ward, Col. L. (Kingston-upon-Hull)
Mercer, Colonel H.Reynolds, W. G. W.Waring, Major Walter
Milne, J. S. WardlawRhodes, Lieut.-Col. J. P.Watson, Capt. J. (Stockton-on-Tees)
Mitchell, W. F. (Saffron Walden)Richardson, Sir Alex. (Gravesend)Watts, Dr. T. (Man., Withington)
Mitchell, Sir W. Lane (Streatham)Richardson, Lt.-Col. Sir P. (Chertsey)Wells, S. R.
Molloy, Major L. G. S.Roberts, Rt. Hon. G. H. (Norwich)Weston, Colonel John Wakefield
Molson, Major John ElsdaleRoberts, Samuel (Hereford, Hereford)Wheler, Col. Granville C. H.
Moore, Major-General Sir Newton J.Roberts, Rt. Hon. Sir S. (Ecclesall)White, Col. G. D. (Southport)
Moore-Brabazon, Lieut.-Col. J. T. C.Robertson- Despencer, Major (Isl'gt'n W)Wilson, Col. M. J. (Richmond)
Morrison, Hugh (Wilts, Salisbury)Roundell, Colonel R. F.Winterton, Earl
Morrison-Bell, Major A. C. (Honiton)Ruggles-Brise, Major E.Wise, Frederick
Murchison, C. K.Russell, Alexander West (Tynemouth)Wolmer, Viscount
Nall, Major JosephRussell, William (Bolton)Wood, Sir H. K. (Woolwich, West)
Nesbitt, Robert C.Russell-Wells, Sir SydneyWood, Major Sir S. Hill- (High Peak)
Newman, Colonel J. R. P. (Finchley)Samuel, A. M. (Surrey, Farnham)Woodcock, Colonel H. C.
Newman, Sir R. H. S. D. L. (Exeter)Sanders, Rt. Hon. Sir Robert A.Yerburgh, R. D. T.
Newson, Sir Percy WilsonSanderson, Sir Frank B.
Newton, Sir D. G. C. (Cambridge)Sandon, LordTELLERS FOR THE AYES.—
Nicholson, Brig.-Gen. J. (Westminster)Sheffield, Sir BerkeleyColonel Leslie Wilson and Captain
Douglas King.
NOES.
Adams, D.Dunnico, H.Hodge, Lieut.-Col. J. P. (Preston)
Adamson, W. M. (Staff., Cannock)Ede, James ChuterJarrett, G. W. S.
Adkins, Sir William Ryland De[...]tEdge, Captain Sir WilliamJenkins, W. A. (Brecon and Radnor)
Alexander, Col. M. (Southwark)Edmonds, G.John, William (Rhondda, West)
Alexander, A. V. (Sheffield, Hillsbro')Emlyn-Jones, J. E. (Dorset, N.)Johnston, Thomas (Stirling)
Ammon, Charles GeorgeEngland, Lieut.-Colonel A.Johnstone, Harcourt (Willesden, East)
Attlee, C. R.Entwistle, Major C. F.Jones, Henry Haydn (Merioneth)
Barker, G. (Monmouth, Abertillery)Evans, Ernest (Cardigan)Jones, Morgan (Caerphilly)
Barnes, A.Fairbairn, R. R.Jones, R. T. (Carnarvon)
Batey, JosephFalconer, J.Jones, T. I. Mardy (Pontypridd)
Bonn, Captain Wedgwood (Leith)Foot, IsaacJowett, F. W. (Bradford, East)
Bonwick, A.George, Major G. L. (Pembroke)Jowitt, W. A. (The Hartlepools)
Bowerman, Rt. Hon. Charles W.Gosling, HarryKenworthy, Lieut.-Commander J. M.
Briant, FrankGray, Frank (Oxford)Kenyon, Barnet
Broad, F. A.Greenall, T.Kirkwood, D.
Bromfield, WilliamGreenwood, A. (Nelson and Colne)Lambert, Rt. Hon. George
Brotherton, J.Groves, T.Lansbury, George
Brown, James (Ayr and Bute)Grundy, T. W.Lawson, John James
Buchanan, G.Guest, J. (York, Hemsworth)Leach, W.
Buckie, J.Guthrie, Thomas MauleLee, F.
Burnie, Major J. (Bootle)Hall, F. (York, W. R., Normanton)Lees-Smith, H. B. (Keighley)
Butler, J. R. M. (Cambridge Univ.)Hall, G. H. (Merthyr Tydvil)Linfield, F. C.
Buxton, Charles (Accrington)Hamilton, Sir R. (Orkney & Shetland)Lowth, T.
Buxton, Noel (Norfolk, North)Hancock, John GeorgeMcCurdy, Rt. Hon. Charles A.
Cairns, JohnHarbord, ArthurMacDonald, J. R. (Aberavon)
Cape, ThomasHardie, George D.M'Entee, V. L.
Chapple, W. A.Harney, E. A.McLaren, Andrew
Charleton, H. C.Harris, Percy A.Maclean, Neil (Glasgow, Govan)
Clarke, Sir E. C.Hay, Captain J. P. (Cathcart)Macnamara, Rt. Hon. Dr. T. J.
Clynes, Rt. Hon. John R.Hayday, ArthurMarch, S.
Collison, LeviHayes, John Henry (Edge Hill)Marshall, Sir Arthur H.
Cotts, Sir William Dingwall MitchellHemmerde, E. G.Maxton, James
Cowan, D. M. (Scottish Universities)Henderson, Rt. Hon. A. (N'castle, E.)Middleton, G.
Darbishire, C. W.Henderson, Sir T. (Roxburgh)Millar, J. D.
Davies, Rhys John (Westhoughton)Henderson, T. (Glasgow)Moreing, Captain Algernon H.
Davison, J. E. (Smethwick)Herriotts, J.Morris, Harold
Duffy, T. GavanHill, A.Morrison, R. C. (Tottenham, N.)
Duncan, C.Hirst, G. H.Mosley, Oswald
Muir, John W.Saklatvala, S.Turner, Ben
Murnin, H.Salter, Dr. A.Wallhead, Richard C.
Murray, Hon. A. C. (Aberdeen)Scrymgeour, E.Walsh, Stephen (Lancaster, Ince)
Murray, John (Leeds, West)Sexton, JamesWarne, G. H.
Murray, R. (Renfrew, Western)Shaw, Thomas (Preston)Watson, W. M. (Dunfermline)
Newbold, J. T. W.Shinwell, EmanuelWatts-Morgan, Lt.-Col. D. (Rhondda)
Nichol, RobertShort, Alfred (Wednesbury)Webb, Sidney
O'Grady, Captain JamesSimpson, J. HopeWedgwood, Colonel Josiah C.
Oliver, George HaroldSinclair, Sir A.Welsh, J. C.
Paling, W.Smith, T. (Pontefract)Westwood, J.
Parkinson, John Allen (Wigan)Snell, HarryWhite, Charles F. (Derby, Western)
Phillipps, VivianSnowden, PhilipWhite, H. G. (Birkenhead, E.)
Philipson, HiltonSpears, Brig-Gen. E. L.Whiteley, W.
Ponsonby, ArthurSpencer, George A. (Broxtowe)Williams, David (Swansea, E.)
Potts, John S.Stephenson, Lieut.-Colonel H. K.Williams, Dr. J. H. (Llanelly)
Price, E. G.Stephen, CampbellWilliams, T. (York, Don Valley)
Pringle, W. M. R.Stewart, J. (St. Rollox)Wilson, C. H. (Sheffield, Attercliffe)
Rees, Sir BeddoeStrauss, Edward AnthonyWilson, R. J. (Jarrow)
Richards, R.Sturrock, J. LengWintringham, Margaret
Richardson, R. (Houghton-le-Spring)Sullivan J.Wood, Major M. M. (Aberdeen, C.)
Riley, BenThomas, Rt. Hon. James H. (Derby)Wright, W.
Ritson, J.Thomas, Sir Robert John (Anglesey)Young, Rt. Hon. E. H. (Norwich)
Roberts, C. H. (Derby)Thorne, G. R. (Wolverhampton, E.)Young, Robert (Lancaster, Newton)
Robertson, J. (Lanark, Bothwell)Thorne, W. (West Ham, Plaistow)
Robinson, W. C. (York, Elland)Thornton, M.TELLERS FOR THE NOES.—
Rose, Frank H.Trevelyan, C. P.Mr. Lunn and Mr. T. Griffiths.
Royce, William Stapleton

Photo of Mr Sidney Webb Mr Sidney Webb , Seaham

I beg to move to leave out the words and in the case of the new import duties until the first day of May, nineteen hundred and twenty-three. These duties were imposed in 1915 for the first time. I do not understand why they were imposed, but it may be partly because some of the articles were small, as for instance watches, and partly because others were bulky, as for instance motor cars. But in the present state of the shipping industry there cannot now be any reason for excluding bulky articles simply because they are bulky. I cannot believe that there was any serious intention of getting money out of these duties because when they were imposed the lot of them put together only yielded £1,000,000 a year. In the year 1920 they went up to a higher figure. I do not know what is the estimate for this year. In the case of some of the articles the duties have apparently crushed out the imports altogether, thus having the effect of damaging also the export trade of this country. The interesting thing is that whatever may have been the reason for which these duties were introduced a definite specific pledge was given that they were to be only for the duration of the War. The right hon. Gentleman who is now the Leader of the House (Mr. Bonar Law) said definitely, when the point was put to him, that duties of this kind should never be continued in any circumstances when the War was over. What the right hon. Gentleman the Member for Central Glasgow, as he then was, and as he now is, though with a somewhat reduced majority—[HON. MEMBERS: "Order!"]—that is germane to the question because in my opinion the action of the right hon. Gentleman in not taking off these duties was one of the reasons why his majority was reduced. We are going to press this Amendment to a Division, and I suggest that what is vital is that pledges of this kind, when they have been given, should be adhered to. It is now more than four years since the War was over—[HON. MEMBERS: "No!" and "Turkey!"] I am not aware that the Turkish Empire was in question when these Duties were put on. It is more than four years since the War, to which the Duties referred, was over—[Interruption]—and all the reasons for retaining them have long since passed away. Why they have been retained I do not know; perhaps merely for the same reason that soime other duties have been retained. Their removal will not even upset the Budget of the Chancellor of the Exchequer, because he has left himself a surplus which will enable him to let these Duties go with merely the ordinary conventional pang of regret which every Chancellor would have. I suggest that the right hon. Gentleman might put the Budget in order by letting these anomalous Duties go, and thus meet the pledge given when they were introduced, that they were War Duties only, and never intended to be continued after the War was over.

Photo of Mr Alfred Bonwick Mr Alfred Bonwick , Chippenham

I beg to second the Amendment.

There are two excellent reasons why I should not detain the house for many minutes. One reason is because I am addressing the House for the first time. The second is that I am certain the Chancellor of the Exchequer will have in mind the cogent arguments which were used last year by my hon. and gallant Friend the Member for Leith (Captain W. Benn). A good many right hon. and hon. Gentlemen opposite seem to imagine that the most telling argument which can be advanced against this Amendment is that these duties were first introduced by Mr. McKenna. Might I remind them that these duties were introduced to achieve certain clearly defined objects? They were introduced to save tonnage, and to release the maximum of shipping space for the transport of essential commodities. It was thought that an import duty of 33⅓ per cent. on motor cars and accessories, musical instruments, clocks, watches, and films, would achieve this end.

There were many of us who thought, at the time, that it would have been better to have prohibited these articles altogether. Many of us prophesied that the time would come when we should hear a cry of protest from manufacturers of this war-born protection being removed. Mr. McKenna said, in introducing these duties, that they were introduced to cut down, so far as we could, the expenditure on imported luxuries. The present Prime Minister said, when he first supported these duties, that the motives for which these duties were imposed were simply to carry out the campaign of economy and to avoid the import of goods which had been going on all through the country. Our case against the continuance of these duties is that they have too long survived whatever temporary justification the War gave them. We object to these temporary duties—for such they were intended to be—because they still form part of our fiscal machinery. My hon. Friend the Member for Seaham (Mr. Webb) has already quoted the pledge which the present Prime Minister gave, that these duties were not to be continued after the War. The Prime Minister also said, in the same speech, that he hoped the duties would be continued only for six or nine months. The question I put to the Chancellor of the Exchequer is this: Does the present Government consider these duties to be temporary or permanent duties? If they are considered now as permanent duties, we await with interest, I was going to say the reason the Prime Minister will give for breaking his word, but, as I do not wish to use harsh words, I will say that we await the reason which the Prime Minister will give for his changed view.

11.0 P.M.

If these duties are considered as a permanent part of our fiscal machinery, we say on this side of the House that we readily and willingly accept the challenge, and we will re-state our case to the electors, as we did between 1903 and 1906, and we will present that case confident that the decision which the electors will give will be the decision which they then gave—a decision that was measured and overpowering. If the Government say that they consider these duties to be temporary duties, I reply that that statement has deluded this House for the last three or four years. The right hon. Member for West Birmingham (Mr. Austen Chamberlain) in 1919 stated that he proposed to continue these duties provisionally for a year. In 1920 he said that he was going to continue them on grounds of pure revenue and not as part of any larger trade policy. So the House has been put off with this cry year after year, and every year we have gone further down the slippery slope of Protection. It was pointed out last year that the revenue from these duties had fallen. As a matter of fact, they were in 1921–22 one-third of what they were the previous year. In defending these duties last year the then Solicitor-General said that the Chancellor of the Exchequer could not afford to forego this revenue. What is to be the argument this year? Are we to be told that these are only temporary duties or that they are to be retained because of the increased revenue which they have produced during the last fiscal year? I find that, in reply to a question that was asked by my hon. Friend the Member for Greenock (Sir G. Collins), the Chancellor of the Exchequer stated the other day that he thought the duties had increased during the last fiscal year by about £750,000. Some of us think these duties are a tax upon industry. Some of us think it can be argued that they form part of a tax upon agriculture. Like many hon. Gentlemen in this House, I have observed agriculture in America and Canada, and we know what a great boon to the agriculturists of those countries the cheap, light car has been. The cheap, light car is of great service to the farmers of this country. I bad hoped that the President of the Board of Trade would have been in his place to-night and that I would have had his support in the Lobby when the Division takes place. I should have it, if the President of the Board of Trade is going to be logical. In replying for the Government to the Resolution submitted a few days ago by the hon. Member for Colne Valley (Mr. Snowden), he informed the House that we paid for what we imported by our foreign sales. I should like to congratulate the President of the Board of Trade on learning this elementary truth of political economy. May I try to take him a step further and say that our foreign sales are paid for by British capital and by British labour? Will the Chancellor of the Exchequer tell us whether these duties are to remain only as temporary duties? If so, we would remind him that they were imposed as a War measure to save tonnage; that they were imposed with a definite pledge, and we ask the Government to redeem the pledge which was made by the present Prime Minister when he was Colonial Secretary.

Photo of Mr Stanley Baldwin Mr Stanley Baldwin , Bewdley

I was very interested in the speech of the hon. Member who has last spoken. I believe it is his first speech in this House and I congratulate him on having accomplished that feat with success. On this side of the House, those of us who were in the last Parliament, have heard what he referred to as cogent arguments advanced for several years past and I would remind the House that cogent arguments do not necessarily increase their cogency by the number of times they are repeated. It is quite true that the hon. Member gave certain reasons, as the hon. Member for Seaham (Mr. Webb) did, for the original imposition of these duties. Some of the reasons for which these duties were imposed have given place to other reasons which have occurred since. There are a number of Members in this House who were returned to support the Government and who have found reasons since then for modifying the views which they held when they were elected. The hon. Member asked whether these duties were temporary or permanent. A great deal depends on how you define those words "temporary" and "permanent." I remember an old lady in the country—in Worcestershire—who once told me with great pride that she had let her rooms permanently—"that is to say," she continued, "for a short time." In the same way, I feel that if I tell the House that I propose to continue these duties for another year, hon. Members opposite may still not be satisfied as to whether I am continuing them temporarily or permanently. The hon. Member for Seaham was, I think, a little in error when he spoke about the small and falling revenue. It is quite true, as the hon. Member who last spoke said, that from 1920 to 1921 there had been a considerable drop, but in that happy year everyone was making money and everybody wanted a motor car. I am only too pleased that when people were able to buy motor cars with such freedom they were also able to help the revenue to the extent that they did. But, while in 1921–22 the revenue from these taxes was over £1,500,000, last year the revenue was nearly £2,500,000, and I hope that in the forthcoming year it will be nearly £2,500,000.

Photo of Mr Stanley Baldwin Mr Stanley Baldwin , Bewdley

I would just say this about these duties: I have not had in the Treasury, nor have the Customs had, a single complaint in the 12 months about these duties, either about the incidence of them or about any trouble in their collection; and the receipts from these sources of a sum of £2,500,000 goes to that extent to enable us to make such reductions of taxation as we have proposed this year. It would be like asking for butter out of a dog's mouth to ask the Chancellor of the Exchequer to give up these duties at the present moment. I quite agree that it was said in the early days of these duties that they were war duties, but as far as finance goes we are still in the days of War finance, for the whole of our finance is dominated still, and must be dominated in the near future, by the charges that have fallen upon us owing to the War, and by the necessity we are under to provide for what was purely a wartime expenditure. I would remind the House that the present Prime Minister, who is quite able to keep his seat without any adventitious aid—and I would remind the hon. Member for Seaham—that all of us who come back time after time, as I have done, and as I hope he will do, have fluctuating majorities. We sometimes get in by more and sometimes by less, but we come back. I have varied from a 3,000 majority to a 12,000 majority, but as long as I get somewhere between those two I am satisfied. As my right hon. Friend the Prime Minister, when he spoke in 1917 on these duties, said: I can assure my right hon. Friend that in these circumstances"— He was referring to the smoothness of collection, and the absence of difficulty that these taxes had caused— it would be carrying prudery to the point of absurdity to take off this source of revenue. Now, whatever I am, I am not a prude.

Photo of Captain William Benn Captain William Benn , Leith

I think my right hon. Friend has not answered the question whether these duties are to be permanent, because the Government is now a Protectionist Government. If it is hard to get butter out of a dog's mouth in 1923, it will be just as hard to get the butter out of what I suppose will be another dog's mouth in 1924 or 1925 or in any other year. So far as any Conservative Chancellor of the Exchequer is concerned, these duties are a permanent part of the fiscal machinery of this country. The pretence by which these Duties were imposed and re-enacted was only a pretence. Our hon. Friends were told this was only to be a war measure, and a pledge was made very definitely that these duties would not under any circumstances be re-enacted when the War was over, at any rate on this scale. Whatever the Chancellor of the Exchequer may say about war finance, the War is over, and the pledge to repeal the duties, at any rate on this scale, when the War was over is not redeemed. The best excuse the Chancellor of the Exchequer can give is that, if there was a reason for giving that pledge, there is no reason for now redeeming it. That is not what is commonly understood by redemption of pledges. These duties form part of a large structure of Protection which the Government and their supporters intend to erect in this country. Every Budget since the members of this Government of the Conservative party had a pre- dominant influence in the Government, we have seen new measures taken to erect this tariff wall round this country, and there is every few months or so some new proposal made of a protective character. It is because we believe in Free Trade and believe that this is a Free Trade country, and that our constituents intend that Free Trade shall be the policy of the Government, and because we received a definite pledge from the Prime Minister that these duties would not be reenacted, that we intend to vote for this Amendment.

Photo of Sir Edward Manville Sir Edward Manville , Coventry

I have the honour to be connected with the motor industry and what I have to say on this Amendment will be the result of my own experience. The Chancellor of the Exchequer has already laid the bogey of no revenue worth talking about being produced by this particular duty. In addition to the success achieved in that direction, there has been a further and even more important success in the fostering of what has become a very important industry, giving employment to tens of thousands of people. It was due mostly to those duties, which were imposed during the War, that the great increase in the motor industry has taken place, those engaged in the industry believing that their expenditure of capital and energy would not be wasted, having regard to the fact that a certain measure of protection would be given to them in their efforts. I know one of the things that will immediately occur to my hon. and gallant Friend the Member for Leith (Captain W. Benn) is that of course that would result in an increase of price to the consumer. I have to say that no such thing has occurred.

I should like to give the House one or two examples of what exactly has happened in that direction. I have taken three cases, though I could take a great many more. First of all, I give the case of a concern which manufactures large and expensive motor cars—not my own, I might say—and that firm charged for a particular size of motor chassis £765 in 1914. To-day it is selling the identical article for £700, and that notwithstanding an increase in the cost of wages and the price of material. Another concern which was charging £300 for a motor car in 1914, is to-day charging £180; and, to mention a further example of a small car—which, after all, is the popular and democratic article, if I may so call it—which was sold for £301 in 1914, to-day is being sold for £275. Those figures are incontrovertible, and I cannot conceive that any kind of argument can be brought against them. The fact is that this duty has not raised the price of these articles by one iota. What has it done, on the other hand? In these days, when unemployment is so rife, the increase in the motor industry in this country has been responsible for a very material increase of employment, and I do net hesitate to say that if the duty were removed, the industry concerned as constituted to-day would practically collapse, and involve the discharge of literally tens of thousands of skilled workmen engaged in the industry. Indeed, I have in my hand a telegram I have just received from one of the principal concerns—a very considerable firm in my constituency—setting forth their alarm at the possible prospect of the duty being removed, stating that such an occurrence would inevitably result in several thousands of their people having to be dispensed with. Hon. Members are well aware that the motor-car industry is one which essentially has to compete with countries in which the exchange, as compared with ours, is very low, and with one country where the home market is so great that there can never be any question of competition with it. One other beneficial effect of this duty is the fact that five foreign firms with whom the firms of this country have to compete, have, as a result of the imposition of this duty, erected works in this country, and a sixth one is about to do so. Therefore, so far from the duty being objectionable from that point of view, it has actually increased the amount of employment through the erection of these works, owned and worked by foreign competitors.

So far from the duty being removed on what are called private motor vehicles, I should wish that the duty should be imposed upon what are called commercial motor vehicles which are at present exempt from the operation of this duty. I quite understand that the present moment is not quite a suitable one, but representations have already been made to the Chancellor, and at a suitable time I shall move an Amendment to include commercial motor vehicles. It does not surprise me to hear hon. Members below the Gangway opposite object to this duty because one knows well that they have no care for new industries, and whether they are helped or the reverse by the imposition of a duty. What I may call the glacial influence existing, in what are called the "true principles of liberalism" which may not be infringed whatever else may perish! But I am surprised at hon. Members above the Gangway who represent the Labour interest, and who declaim from time to time against the inadequacy of private effort to produce employment, yet, when they have an opportunity of preserving work, they take the action they do, though within their certain knowledge it is going to turn tens of thousands of men at present employed out of work. May I say that I am rather glad they have taken up this attitude. My constituents are largely composed of men who would thus lose their jobs and at the next General Election I shall hear their verdict as to whether they would rather stay in work, or be turned out by the effect of an Amendment such as this.

Photo of Mr Emanuel Shinwell Mr Emanuel Shinwell , Linlithgowshire

Hon. Members on this side of the House will be delighted at the remarks of the hon. Gentleman who has just spoken, particularly as to the need of employment here amongst particular classes of working men. But he should address his remarks to the Chancellor of the Exchequer. For it will have been observed that there is a remarkable inconsistency as between the remarks of the hon. Member for Coventry (Sir E. Manville) and the reply of the right hon. Gentleman to my hon. Friend below the Gangway. As I understand it the substance of the case for protection in which I understand the hon. Member below the Gangway believes, is that the imposition of a tariff will have a prohibitive effect, and in consequence there will be more employment in the country. But, obviously, from what has been said that is not the reason for the imposition of these particular taxes. The right hon. Gentleman opposite told us that in the course of the last year or two reasons exactly dissimilar to those originally advanced for the imposition of these duties have been submitted. We are now retaining the duties because they will produce revenue.

If revenue be the object aimed at, then I submit that there is no possibility whatever of prohibiting to the fullest extent, as desired by hon. Gentlemen opposite, the importation of motor cars, watches, and gramophones, which are the things aimed at in these Financial Clauses in order to provide more employment for those engaged in those particular industries. You cannot have it both ways. If it is intended to retain those duties for revenue producing purposes, then the whole case for protection falls to the ground. I submit that the argument submitted by the hon. Member for Coventry on behalf of tens of thousands of workers is asking us to stretch our imagination, because there are no tens of thousands of such workers in this country.

Photo of Sir Edward Manville Sir Edward Manville , Coventry

The hon. Member is making a statement which is not borne out by the facts. There are more than 20,000 workers employed in those industries in this country.

Photo of Mr Emanuel Shinwell Mr Emanuel Shinwell , Linlithgowshire

There are no tens of thousands of workers affected as the hon. Member imagines they are affected. Does he suggest that in the watch-making trade those employed are likely to be affected by the imposition of the duties which the hon. Member wishes to retain? Does he suggest that those engaged in the gramophone industry are likely to be affected in the same way? Those engaged in the motor car trade are not so much affected by these duties as by the lack of organisation in the industry itself. There is much to be said for the development of the motor car industry in this country but if those engaged in this important industry were to take a leaf out of the book of the American producers by developing their organisation and adopting Less antiquated methods of production with higher wages, they would assist to a far greater extent the development of this important industry.

I contend that the right hon. Gentleman submitted no cogent arguments in reply to the Mover of this Amendment. The case is an exceedingly simple one. This was a war-time measure. There was a lack of transport and some prohibition had to be introduced and that was a very desirable thing under the circumstances. But those conditions have gone now, probably never to return. In the next place, the Prime Minister stated quite explicitly that the end of the war would see the end of these duties. The Chancellor of the Exchequer says that there are additional reasons now, but surely we are entitled to know what are those reasons. It is no argument to introduce a story about a lady from Worcestershire who, in my judgment, had no relation to the case at all. I think it is rather a pity that an alleged incident of that kind should take the place of what ought to be a substantial argument in reply. At all events, that facetious reply, very desirable, it may be, at this time of night, but very undesirable having regard to the condition of things in the country, ought not to have taken the place of a well-reasoned and ordered sequence of arguments.

I differ from the hon. and gallant Member for Leith (Captain W. Benn) in regard to the assumption that this is a part of the case for protection. It is nothing of the kind. If we are to believe the right hon. Gentleman—and I prefer to believe him rather than the hon. Member for Coventry, for after all, it comes with greater authority from the right hon. Gentleman—I do not believe that this is part of the case for protection. Hon Members opposite may believe that, and to the extent that they are deluded by the Members of the Cabinet, that is their affair, and not the responsibility of hon. Members on this side. At all events the House and the Country are entitled to reason and logic from the right hon. Gentleman. He may smile, he may submit facetious arguments and stories about doubtful ladies in Worcestershire—[HON. MEMBERS: "Order!"]—or ladies of virtue, for that matter, in Worcestershire or anywhere else—but they will not take the place of what we desire in order to understand thoroughly what is meant by the imposition of the duties referred to. There is no case whatever for these duties. The hon. Gentleman has said—and this seems to be the strongest argument, if any argument were submitted—that last year their yield was increased by hundreds of thousands of pounds, the total, I think, being £2,500,000. Is anyone going to suggest, however confirmed a protectionist he be, that £2,500,000 of taxation has any appreciable effect on the motor car or any other industry in this country? Of course not. The Chancellor of the Exchequer's case has failed. He has not replied to the hon. Member for Chippenham (Mr. Bonwick), and this House is entitled to ask that these duties be withdrawn.

Photo of Mr William Pringle Mr William Pringle , Penistone

The Chancellor of the Exchequer has assumed that, because the case of these duties was somewhat inadequately debated on various occasions in the last Parliament, it is, therefore, unnecessary to cover the ground; but there are a great many people here in this House who were not in the last Parliament, and the right hon. Gentleman is, unfortunately, not supported by the serried battalions which supported his predecessors in that office and were content with any kind of argument at all. The one thing that surprised me in the Chancellor's speech was the statement that he was no prude. I always fancied that he was a prude. I observed constantly, during the last Parliament, his increasing disgust at the methods of the Coalition. He was becoming obviously more uncomfortable day by day, and month by month, with the methods of the Government with which he was associated, and it did not come as a surprise to me, therefore, that he took the strong action which he did take at the Carlton Club, in bringing this unseemly thing to an end. We believed that he was something of a prude; but now he comes forth with the same shamelessness as his predecessors, as if nothing had been done at the Carlton Club to purify the political atmosphere at all. We are disappointed. We had thought a new order had come, that these disgusting demi-mondaine conditions had come to an end, and that we were now entering into an era of political purity, after the standards of the "Morning Post". We believed we were to have an honest defence of these duties now. We believed they would not be content with the makeshifts and pretences and impostures which had done duty with three successive Chancellors of the Exchequer. But the right hon. Gentleman is as bad as the rest. He offers no apology whatever for breaches of pledges. He says these were imposed for one set of reasons, and another set of reasons has supervened, just as he said certain hon. Members have been returned to this House to support the Government for one set of reasons, and they have found another set of reasons for opposing it.

Was not that a sad confession? Does he approve of the political morality which has led these gentlemen who were returned to support him going back upon their word? Does he accept these new political ethics that a candidate is entitled to come before a constituency and say he will give a general support to the Government and then, within three months of obtaining election under these conditions, go back and say, "The circumstances have altered. I have found some new reasons." I am surprised at the right hon. Gentleman. Apparently, according to this train of reasoning, these gentlemen who have given pledges to support him are now perfectly entitled to withdraw that support. I did not think a purist like the right hon. Gentleman, who insisted on destroying the Coalition at the Carlton Club, would have shown approval of doings like these. I thought he would have said "these were pledges. Let these hon. Gentlemen who go back on their pledges submit themselves once more to the electors. Let us get back to a right political atmosphere." We are still in the old ways. The more they change, the more they are the same thing.

I was much more impressed with the argument of the hon. Member for Coventry. He put up a fair, honest, Protectionist argument. He said British industry was benefited. The motor-car manufacturers were benefited. The workers will be thrown out of work. Of course they always will be. Let the Chancellor of the Exchequer be honest and adopt the arguments of the hon. Member. Then we shall knew where we are. I was not greatly impressed with these arguments because I had heard them all before. We were told the motor industry could not do any good in this country before the War. It seemed to me to be making very considerable progress in pre-war days under conditions of Free Trade. There were even some foreign manufacturers who came to this country under Free Trade conditions. I think the Fiat company and the Renault had works in this country.

Photo of Sir Edward Manville Sir Edward Manville , Coventry

The Renault Company had no works, and the Fiat Company had only small repair works.

Photo of Mr William Pringle Mr William Pringle , Penistone

I was probably misled by seeing the outside of the works. There were, undoubtedly, works coming to this country even before the War, and British manufacturers were extending their business, and making profits out of the business. There were large numbers—I do not know how many tens of thousands—employed in the motor car industry before the War, without any tax upon the consumer in this country. Now, apart from this tax, we are told that it would be altogether impossible to maintain employment in this industry. I do not believe it. If that is the argument adopted by hon. Gentlemen opposite, how can they resist the arguments put forward by other people. How can the Prime Minister, and the Chancellor of the Exchequer, resist the protection of agriculture. There supporters point to the benefits which the motor industry are receiving as a result of this 33⅓ per cent. duty.

Photo of Sir Edward Manville Sir Edward Manville , Coventry

Firms are making losses.

Photo of Mr William Pringle Mr William Pringle , Penistone

We are getting at it at last. We are told that this tariff is producing losses, and I suppose foreigners are coming here to share in the losses. Perhaps in the later stages of the Bill we shall get a great deal more light. Now, apparently, this protection, which is giving employment to tens of thousands of people in this country, is being carried on at a loss. This is the monument to this great new system. I suppose the manufacturers are doing it as benefactors of humanity, and the foreigners are coming here as philanthropists. I always thought that it was the foreigner who paid the duty. Now, I suppose they are extending their philanthropy, and are coming here to share in the losses. Protectionists will have to arrive at some more logical and coherent line of argument before they are going to impress the House in this matter.

Where is this protection to stop? If the right hon. Gentleman continues these duties on motor cars, watches, gramophones and so on, he cannot refuse protection to people who have the prices of these things raised against them. It is all very well to say that the prices are not up as compared with 1914. Does the right hon. Gentleman mean to tell us that the prices would not be lower if there were no duties? That is the real point. He told us that commercial cars are cheaper because there are no duties. The other motors would be cheaper if there were no duties. The poor farmer has to pay more for his motor car because of these duties. Why is he not to have a share in the spoil? Why is he not to be protected? Why is he not to be encouraged to give employment to men at present out of work in the agricultural industry? Why is he not to have a chance of paying his workers a living wage? There is no answer on the footing of those duties, so long as these duties remain, and so long as they are supported by the arguments put forward by the hon. Member for Coventry, there is no answer. You therefore have to repeal the duties even at the sacrifice of the small revenue which the right hon. Gentleman is getting which can be easily got over. Furthermore, it will enable the Government to carry out at least one of the pledges given by their predecessors.

It was the Prime Minister himself, when he was Colonial Secretary, in supporting the McKenna duties, when they were first brought in, who gave the clearest pledge. He said "We are not proposing these for protectionist purposes. If I had protectionist views in my mind I would have a different scale of duties. These are war measures put forward for the purposes of the war, and will come to an end when the war is over." I know that hon. Members in front of me who supported the late Government accepted that argument. As a result of an Amendment proposed by the hon. and learned Member for Middleton (Sir R. Adkins) in 1919, these duties were made to run only from year to year so that they could be brought to an end at the earliest possible moment, and it was on that footing that these hon. Gentlemen gave their votes for these proposals in 1919. They are therefore quite free now. It is because of that pledge that this resolution appears on the paper to-night. We have an opportunity now of ascertaining whether the Government are going to adhere to the pledge or are going to be honest and accept the protectionist argument of the hon. Member for Coventry. There is no escape from that dilemma. Let them be honest protectionists—and then they cannot confine that protection to these things—or be true to their pledges and get rid of the duty altogether.

Photo of Mr Andrew MacLaren Mr Andrew MacLaren , Stoke-on-Trent Burslem

I desire if possible to raise this debate out of the field of contention to a higher and purer atmosphere. I join in the appeal to the right hon. Gentleman to remove the tax which is levied on musical instruments. Those of us who are interested in the development of arts know what it is to suffer from some of the English products in the form of the piano. The finest pianos we can get come from abroad. I appeal to the right hon. Gentleman, if he is anxious to develop the aesthetic qualities of the people of this country, to do something to take this tariff off the piano. I suppose that right hon. Gentlemen opposite are very anxious to do everything in their power—indeed it was advocated by the Chancellor himself—to encourage the motor industry. I have heard argument after argument to the effect that the tariff on motors is specially put on to encourage the motor industry. I put to every Member opposite this question. If right hon. and hon. Members opposite are so anxious to encourage the motor industry of this country, will they, when they are asked by the Ministry of Agriculture to continue to levy heavy taxation on the motors of this country, with a view to relieving the agricultural landowners from rates for maintaining the roads, forget what they are saying to-night and support the right hon. Gentleman in maintaining the heavy taxation on the motor industry? To-night it is "Relieve the motors"; to-night it is, "Keep out foreign competition, in order to stimulate the British motor industry."

A few nights from to-night, possibly, all the right hon. and hon. Members on the other side will support the imposition of heavy taxation on the vehicles on the roadways in order to relieve these landowners. To me this is an extraordinarily illogical. It is another case of changing your mind according to the circumstances of the moment. It gives me, at least, a strong suspicion that like all other tariff inventions, this is brought in under a pretext of a War exigency measure, such as it was in America. It is quite evident from the Debate, so far, that hon. Gentlemen opposite no more relieve the country of these imposts, as long as they have the power, than they will fly in the air. I hope they will have the honesty, when the next election is due, to tell the electors that this supposedly transitory duty has now become the permanent policy of their party. Then, I can assure the Chancellor of the Exchequer that he will not be able to crow about his oscillating majority. It will become a transient thing, if not a transformed thing; perhaps we shall miss his brilliant company in this House.

All I appeal for is consistency. If right hon. and hon. Members are anxious to relieve the motor industry from any hindrance to its development and to stimulate it, then I challange any one opposite, when it comes to imposing taxes on vehicles in this country to keep up the roads, to go into the Lobby and support that tax. The inconsistency of hon. Gentlemen who are anxious to hold on to power will, I am afraid, continue as long as the people are deluded with the idea that all sorts of artificial supports coming from the taxpayers' pocket are keeping them in employment. The whole idea behind it is that we cannot develop an industry in this country, because, as the hon. Member for Coventry (Sir E. Manville) said, if this tariff were taken away the motor industry would cease to exist in this country. What is that but, saying that the tariff is keeping up the price which the motor industry is in a position to demand to-day? It is past elementary reason, in the field of economics, to try to maintain that a tariff, levied on any commodity coming into this country, is not ultimately passed on to the consumer using that commodity. I thought I had a duty to perform in pointing out this illogical piece of reasoning on the part of right hon. and hon. Gentlemen opposite, and we shall watch them in the future, when this other little item—that of levying taxes on the vehicles of this country—comes along.

Photo of Mr Austin Hopkinson Mr Austin Hopkinson , Mossley

I should like, as probably the most obstinate and convinced Free Trader in this House, to support these duties. I may say, at the outset, that I think the hon. Member for Penistone (Mr. Pringle) was labouring under a misapprehension. It is no use accusing the existing Government or the late Government of political corruption and insincerity, since real political purity and sincerity are impossible in any Government which does not contain the Earl of Birkenhead. I think the hon. Member for Coventry (Sir E. Manville) in making his speech in favour of pro- tection, was really showing a very large degree of self-sacrifice, since the motor company with which he is connected, and which is being protected by this, to a certain extent, is in alliance with one of the companies which is one of the largest importers of American and German machine tools. Therefore, I do not think it would be fair of hon. Members opposite to accuse the hon. Member for Coventry of being an interested party in this matter. Seriously, these duties, it would appear, are not in any sense of the term protective duties. They are duties imposed for revenue purposes upon purely luxurious articles. They are no more protective duties than ordinary excess duties upon luxuries. So long as they are kept within the very close limits, within which they are kept at present; so long as the motor duty is only to be imposed on luxury cars of one sort or another and is not to be imposed on commercial vehicles, then so long is it possible for any convinced Free Trader in this House to vote for these duties and I shall do so. [HON. MEMBERS: "Divide."]

Photo of Mr Charles Darbishire Mr Charles Darbishire , Westbury

When hon. Members on this side of the House ask the Government for money for social purposes—[HON. MEMBERS: "Divide" and "Order"]—they are told that there is no pool of capital into which we can put our hands to get that money. The Protectionist is obsessed by exactly the same fallacy with regard to a pool of capital. If you protect any particular industry by a tariff, you immediately attract capital into that industry and take it away from some other industry and therefore you produce unemployment in that other industry. I am opposed to all tariffs, because once you start to erect a tariff, you have to go on erecting it higher and higher, as has been proved in America. When the hon. Member for Coventry (Sir E. Manville) tells us that American car manufacturers are opening works in this country he should also point out, that they are doing so, not because we have a tariff, but because the tariff in America is so high, and consequently, the cost of production in America is so high, that they cannot produce and export cars. The "Times Commercial Supplement" of the other day, contained a statement to the effect that an American ropeworks company was opening works in this country, because they were unable to produce ropes in America—owing to the high tariff there upon imports—at a price at which they could sell in this country. [HON. MEMBERS: "Divide" and interruption.] That is Tory argument. I shall quote, again from the "Times" in connection with the statement made by the hon. Member for Coventry as regards the Fordney Tariff. [Interruption.] I trust that hon. Members of the gentlemanly Party—the aristocratic Party—will hear me.

Photo of Mr David Kirkwood Mr David Kirkwood , Dumbarton District of Burghs

If you do not keep Order, you are going to be kept here all night.

12 N.

Photo of Mr Charles Darbishire Mr Charles Darbishire , Westbury

I quote again from the "Times Commercial Supplement" under the heading "United States Tariff"— Meanwhile it is admitted that the American manufacturer, securely entrenched behind the tariff wall, is seizing the opportunity to raise his prices in most instances by the equivalent of the increase of duty. That is what is happening in America.

Another quotation is this: Reference has already been made to the way in which American prices are being increased by the amount of the import duty. Importers into the United States fear this action will smooth the path for British goods, particularly if the cost of the latter to the consumer can be lowered. That enforces my point. Once you get a tariff, prices in the protected country rise and before you know where you are the goods are flowing in over the wall. The President of the Board of Trade or the Chancellor of the Exchequer may think, like King Canute, that he can stop the tide but he cannot do so. Sooner or later the goods will flow in over the tariff wall. I am not quoting my own opinion. I can quote bankers and merchants in the City of London. The President of the Board of Trade the other day, quoted Mr. Goodenough on this same question of the Fordney Tariff. I can give quotations from Mr. Goodenough which should satisfy hon. Members as to the soundness of the Free Trade position on this matter—and not only from Mr. Goodenough, but from practically every banker in the City of London. What was the moral of it all? The moral is that we want the Government to leave trade alone in this country. I think it was Gladstone who said the duty of a Government was to govern and not to trade. When you have men in the Government who obviously know nothing about trade—

Photo of Mr Emanuel Shinwell Mr Emanuel Shinwell , Linlithgowshire

And less about government.

Photo of Mr Charles Darbishire Mr Charles Darbishire , Westbury

—When you have gentlemen like the President of the Board of Trade, who seem to think that the British merchant and trader is the biggest dunderhead who ever wore out shoe leather, and that we can only manage our business through departments of Overseas Trade and Trade Commissioners and that sort of thing, then it is high time we got back to the principal enunciated by Gladstone. I remember seeing a cartoon depicting a gentleman of rather Jewish appearance, with a top hat—[HON. MEMBERS: "Withdraw."]—and a Union Jack waistcoat, who is called "Mr. Tariff Reform." Standing by him was the present Prime Minister, who was represented as saying to him—it is just after the 1906 election.— It is a queer thing, laddie, but there is a sort o' summat about you that evidently does not inspire confidence. These duties are being imposed to-day by the Chancellor of the Exchequer for no reason whatever. He says they are War duties and temporary duties, continued because we are not out of War finance. When are we going to get out of War finance? Is it not to be for another 50 or 60 years? What is the sense of saying these are temporary duties? Why does not the Chancellor of the Exchequer be a man and come out and say that he intends them to be permanent? He talked about the old lady of Worcester. Unless he can give us a straight lead on this question, that the Government is not out for Protection, the tenure of those benches by the Government will be very permanent for a short time only.

Photo of Mr Thomas Shaw Mr Thomas Shaw , Preston

I have risen, not for the purpose of talking about old ladies from Worcester, not for the purpose of accusing the Government of having broken its pledges—I never expected it to keep them—but to deal with an expression which fell from the hon. Member for Coventry (Sir E. Manville), who said that the Labour Members apparently cared nothing for the employment of thousands of people. I am one of those who know something about the thousands of unemployed, competent people, and I am satisfied in my own mind that many of them are unemployed because of the policy that is to be pursued if this protective tariff goes through. There is no guarantee that a protective tariff will create employment; rather is there a guarantee that a protective tariff will spoil and destroy any tendency towards efficiency and will create a barrier, not so much against foreign goods, as against the proper efficiency of an industry, which is the only thing in the world that can make that industry prosperous. I believe that in Britain we have the finest type of working man in the world and that if the same skill and industry and organizing capacity were shown on the part of the employers as we see on the part of the workmen—

Photo of Sir Wilfred Sugden Sir Wilfred Sugden , Royton

We have the finest employers in the world, too.

Photo of Mr Thomas Shaw Mr Thomas Shaw , Preston

The hon. Member for Royton (Sir W. Sugden) knows very well a county where there are fine, capable employers who do not want Protection, and who object to it. If he cares to go and talk to the people he knows so well in Lancashire, those fine employers, as he calls them, they will tell him that the finest type of employer is the man who knows how to arrange his works so that he has no need for protection. That is the condition of affairs that exists in the county to which the hon. Member belongs. I, personally, object to this policy, because I believe that it is a policy that bolsters up inefficiency, that leads to corruption in public life, and that inevitably makes for bureaucracy. There is no question about that. How many industries have come begging to the Government since they saw an opportunity of being put on the list of protected trades, every private interest trying to force the Government to give it a little bit, every private interest trying to shelter itself behind Protection? I want to repeat what I have said in this House before, that we had an artificial protection during the War, and we saw what it meant. The people of this country were mercilessly bled by the farmers, by every industrialist who had the artificial protection, and I object to continuing, in a state of peace, things that were so dastardly in their effects during the time of war. Tell your farmers and your manufacturers that the first thing they have to do is to make their own work efficient, then come to the nation to ask for support.

The argument that was used was that if this protection were withdrawn, all these thousands of men working in the motor industry would be stopped. Does any hon. or right hon. Member opposite believe that that statement is true? [HON MEMBERS: "Yes".]—Then I have a great amount of admiration for the sincerity of hon. Members opposite, but very little admiration for their judgment. In my opinion, that belief is absolutely without foundation in fact. Who is the dangerous competitor in motors for this country? [HON. MEMBERS: "America".] America pays higher wages and pays more for materials. Why, then, can America undersell us? [An HON. MEMBER: "Ford".]—If hon. Members do not know that the success of Ford is due to his organizing genius, the set out of his firm, and the methods of his working, then God help us if we have a Government composed of people who know so little. I oppose this tax because of the reasons I have already given. I do not believe that this country can survive unless its industries are properly organized, unless its workers are working under decent conditions. I do not believe that it needs bolstering up. We have the workers, and if we had the scientific employers, we should not need taxes of this kind. Look at the arguments that have been used. We are told in one breath that this tax is making work for Britons because it is preventing the market from being flooded by foreign motors. The Chancellor of the Exchequer himself says, in reply to the hon. Member for Seaham (Mr. Webb), "Your statement that this tax is not bringing in a larger yield is not correct." As a matter of fact, we must be importing more motors than ever, because the Chancellor says the yield of the tax is mounting up. Which is the truth? Are they being kept out, or are they being brought in? The Chancellor says they are being brought in. The hon. Member for Coventry says we are building up our works because they are being kept out. One never knows where these statements are going, and what they mean.

Personally, I shall go into the Lobby against the Government. I go in with them sometimes, and I would do so now if I believed they were right, but I believe they are wrong. I believe their policy of Protection is keeping hundreds of our people in Lancashire out of work by their method of laying taxes on dyes and thus giving us imperfect dyes. We have the finest trade in the country, and it was before the War the largest exporting trade in this country. It is the most competent trade in the world, yet we have our workers unemployed. Do hon. Members expect Members like myself, who really do have as much sympathy with the workers, to put it mildly, as the hon. Member for Coventry, to vote for a policy that we think in our heart of hearts is bad for our country? It leads to inefficiency, corruption and incompetence, and it is because I believe Protection leads to inefficiency, corruption and incompetence that I shall vote against the Government.

Photo of Mr Herbert Spencer Mr Herbert Spencer , Bradford South

I want to congratulate the hon. Member for Preston (Mr. T. Shaw) on the magnificent speech in which he has shown the folly of Government interference in trade, and I hope he will make the speech again in the Adjourned Debate on Socialism. Interference by Government, whether in the form of tariffs or Government management, is almost invariably bad. I, for one, do not want to see either tariffs or bureaucracy and I am glad to see that the Member for Preston sees the danger of bureaucracy. I want to advance the argument that tariffs on motors are causing unemployment in this country to-day. I have a telegram from a motor manufacturer in my own city, who is a constituent of my hon. Friend the Financial Secretary to the Treasury in Bradford. He is demanding that I should vote for a Protectionist tariff. I am a dress goods manufacturer in the same city, and every extra pound spent on motors prevents people buying the dress goods that I make. I am a Protectionist for myself, as we all are. If you give me 33⅓ per cent. protection against French dress goods, I will at once buy £250,000 worth of British yarn and make it into dress goods off which I will make 25 per cent. profit and I will pay thousands of pounds in Income Tax and Super-tax, and instead of careering about the country with my wife in a "tin lizzie" I will buy a Daimler motor car. All I want is the legislative right to rob the men and women of England—[Interruption]—give me that, and I will do all the things the hon. Member for Coventry tells us are so good. I have far more right to this protection that the hon. Member for Coventry (Sir E. Manville) has. The hon. Member for Coventry has the right to buy his raw materials as cheaply as he can in the markets of the world, but the Government has robbed me of that right. The Government makes me pay twice what the Frenchman has to pay for many dyewares. That handicaps me in the London market by adding to the cost of my production, yet the French dress goods come in without a duty. The competition of hon. Member for Coventry is against America where the exchange is high, while the French exchange is low. Every argument the hon. Member for Coventry has used I can use in greater reason of right. The remedy is better organisation within the factory and my hon. Friends to my right must let me say it is a higher output among the men—[Interruption.] We have got—

Photo of Mr Ben Turner Mr Ben Turner , Batley and Morley

On a point of Order. Is it right, Mr. Speaker, for the hon. Member for South Bradford (Mr. Spencer) to slander the workpeople of Bradford by saying that they do not give a poor output?

Photo of Mr John Whitley Mr John Whitley , Halifax

I do not quite see the relevancy of the point.

Photo of Mr Herbert Spencer Mr Herbert Spencer , Bradford South

I never made such a statement. [HON. MEMBERS: "It was an insinuation!"] I never made such a statement, and the hon. Member who has just spoken knows perfectly well that such a thing as slandering my friends, the workpeople from whom, and by whom, I make my living, would be the very last thing I should do. But a man may be a better friend to his own workpeople by telling them the truth than by living upon them. I want to say with all respect that this bandying from one side to the other of capital and labour is bad for the country, and bad for trade. We know, all of us, that the success of Henry Ford in his motor works is not only organisation and high wages—the highest in the world—but as he says himself in the book which I wish every Member of the Labour party would read, the policy and philosophy of the work there is high wages, magnificent organisation and great output! There is no limit to the output. My objection to these duties is that they are pure protectionist. I want to appeal to the Government on one other matter. In 1906 the right hon. Gentleman the Member for Paisley (Mr. Asquith) pledged his party that if the Liberal party were returned to power they would not touch Home Rule during that Parliament. In like manner the Conservative Members for Lancashire, almost without exception, got in as free traders. In my own city, Bradford, we had twelve candidates and eleven of them unequivocally-pledged themselves as free traders. The Financial Secretary—I am speaking from memory—I think said he was a free trader, although he said that the question was not then a live issue. The point is this: These benches are filled with gentlemen who got into Parliament as free traders and it is not playing the game with their constituents to pass protectionist Measures, and for that reason I oppose these duties.

Photo of Mr Richard Wallhead Mr Richard Wallhead , Merthyr Tydfil Merthyr

I rise for the purpose of pointing out that although we on these Benches are supporting the abolition of these duties, and may to the extent be said to be supporting Free Trade, we are not doing it because it will abolish the things that protection will not abolish. Poverty will remain either under Free Trade or Protection, and so will Unemployment, but neither of these things will solve this problem. When the Member for Bradford talks about licensed robbers by Tariff Reform we declare that the people can be robbed as well under Free Trade as under Protection. With regard to the speech of the hon. Member for Coventry (Sir E. Manville) he admitted that with higher wages and higher cost they were producing motors in Coventry at a lower price than before the War, which is a fair proof that it is not protection that is required but improved organisation. It has been demonstrated that improved organisation came as a consequence of Government interference during the War. The late Prime Minister has boasted more than once that it was organisation that won the war and Mr. Churchill has said that it was organisation by the State that brought perfection of production during the war. Another thing also happened and it was the application of the socialist principle of the nationalisation of inventions. You nationalised them during the war and therefore the claim that Governmental interference is fatal is not borne out by the experience of this country during the war.

We object entirely to the re-imposition of these duties and we believe that the hon. Member for Coventry has performed a public service and a public benefaction by his speech. The Chancellor of the Exchequer tells us that these duties are more or less permanent and may remain with us so long as we are confronted with the terrible burden of the war, and he further states that we are more or less in a state of war because we are dealing with conditions imposed upon us by the war. It has been estimated by one hon. Member that we may be able to get rid of these war conditions in 60 years, but if we deal with things in the way the present Government are pursuing it will not be 60 years but 160 years before those conditions disappear at the rate the Chancellor of the Exchequer is proceeding with

a half per cent. rate as a sinking fund. It is quite as well that we should know that it is the intention of the Conservative party to inflict a protectionist system as far as this country is concerned. It is well that Lancashire should know that. Though I am not living in Lancashire now, I cannot forget my connection with the county of Lancashire during the last twenty-five or thirty years. They will speak with no uncertain voice with regard to the claims put forward by the hon. Member for Coventry, and I predict that the more of that class of speech that we get the sooner we shall have in this country a Government pledged to absolute free trade, and a Government also that dare tackle the finance of the country in a logical way for the purpose of wiping out these abominable war conditions that obtain and setting the finances of the country on a stable basis.

Question put, "That the words proposed to be left out stand part of the Resolution."

The House divided: Ayes, 233; Noes, 158.

Division No. 108.]AYES.[12 33 a.m.
Agg-Gardner, Sir James TynteCassels, J. D.Gates, Percy
Ainsworth, Captain CharlesCayzer, Sir C. (Chester, City)Gaunt, Rear-Admiral Sir Guy R.
Alexander, Col. M. (Southwark)Chapman, Sir S.Goff, Sir R. Park
Amery, Rt. Hon. Leopold C. M. S.Churchman, Sir ArthurGray, Harold (Cambridge)
Apsley, LordClarry, Reginald GeorgeGreene, Lt.-Col. Sir W. (Hack'y, N.)
Archer-Shee, Lieut.-Colonel MartinClayton, G. C.Guinness, Lieut.-Col. Hon. W. E.
Ashley, Lt.-Col. Wilfrid W.Cobb, Sir CyrilGwynne, Rupert S.
Astor, J. J. (Kent, Dover)Cockerill, Brigadier-General G. K.Hacking, Captain Douglas H.
Baird, Rt. Hon. Sir John LawrenceColfox, Major Wm. PhillipsHall, Lieut.-Col. Sir F. (Dulwich)
Baldwin, Rt. Hon. StanleyCope, Major WilliamHalstead, Major D.
Balfour, George (Hampstead)Courthope, Lieut.-Col. George L.Hamilton, Sir George C. (Altrincham)
Banks, MitchellCraig, Captain C. C. (Antrim, South)Hannon, Patrick Joseph Henry
Barlow, Rt. Hon. Sir MontagueCraik, Rt. Hon. Sir HenryHarmsworth, Hon. E. C. (Kent)
Barnett, Major Richard W.Croft, Lieut.-Colonel Henry PageHarrison, F. C.
Barnston, Major HarryCrook, C. W. (East Ham, North)Harvey, Major S. E.
Bell, Lieut.-Col. W. C. H. (Devizes)Curzon, Captain ViscountHawke, John Anthony
Bellairs, Commander Carlyon W.Davidson, J. C. C. (Hemel Hempstead)Hay, Major T. W. (Norfolk, South)
Bennett, Sir T. J. (Sevenoaks)Davidson, Major-General Sir J. H.Hennessy, Major J. R. G.
Bentinck, Lord Henry Cavendish-Davies, Alfred Thomas (Lincoln)Herbert Dennis (Hertford, Watford)
Berry, Sir GeorgeDavison, Sir W. H. (Kensington, S.)Herbert, S. (Scarborough)
Betterton, Henry B.Dawson, Sir PhilipHilder, Lieut.-Colonel Frank
Birchall, Major J. DearmanDixon, C. H. (Rutland)Hiley, Sir Ernest
Blades, Sir George RowlandDu Pre, Colonel William BaringHoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Bowyer, Capt. G. E. W.Edmondson, Major A. J.Hogg, Rt. Hon. Sir D. (St. Marylebone)
Boyd-Carpenter, Major A.Ednam, ViscountHohler, Gerald Fitzroy
Brassey, Sir LeonardElliot, Capt. Walter E. (Lanark)Holbrook, Sir Arthur Richard
Bridgeman, Rt. Hon. William CliveEllis, R. G.Hood, Sir Joseph
Briggs, HaroldEngland, Lieut.-Colonel A.Hopkins, John W. W.
Brittain, Sir HarryErskine, James Malcolm MonteithHopkinson, A. (Lancaster, Mossley)
Brown, Major D. C. (Hexham)Erskine-Bolst, Captain C.Howard, Capt. D. (Cumberland, N.)
Bruton, Sir JamesEyres-Monsell, Com. Bolton M.Howard-Bury, Lieut.-Col. C. K.
Buckingham, Sir H.Falcon, Captain MichaelHudson, Capt. A.
Buckley, Lieut.-Colonel A.Falle, Major Sir Bertram GodfrayHume, G. H.
Burn, Colonel Sir Charles RosdewFawkes, Major F. H.Inskip, Sir Thomas Walker H.
Burney, Com. (Middx., Uxbridge)Fermor-Hesketh, Major T.Jackson, Lieut.-Colonel Hon. F. S.
Butcher, Sir John GeorgeFord, Patrick JohnstonJames, Lieut.-Colonel Hon. Cuthbert
Butler, H. M. (Leeds, North)Forestier-Walker, L.Jenkins, W. A. (Brecon and Radnor)
Butler, J. R. M. (Cambridge Univ.)Foxcroft, Captain Charles TalbotJephcott, A. R.
Butt, Sir AlfredFremantle, Lieut.-Colonel Francis E.Jodrell, Sir Neville Paul
Button, H. S.Furness, G. J.Kennedy, Captain M. S. Nigel
Camplon, Lieut.-Colonel W. R.Galbraith, J. F. W.King, Captain Henry Douglas
Kinloch-Cooke, Sir ClementPaget, T. G.Somerville, Daniel (Barrow-in-Furness)
Lamb, J. Q.Parker, Owen (Kettering)Sparkes, H. W.
Lane-Fox, Lieut.-Colonel G. R.Pease, William EdwinSpears, Brig.-Gen. E. L.
Leigh, Sir John (Clapham)Pennefather, De FonblanqueSpender-Clay, Lieut-Colonel H. H.
Lloyd, Cyril E. (Dudley)Penny, Frederick GeorgeStanley, Lord
Lorimer, H. D.Percy, Lord Eustace (Hastings)Steel, Major S. Strang
Lort-Williams, J.Perkins, Colonel E. K.Stott, Lt.-Col. W. H.
Lougher, L.Pielou, D. P.Stuart, Lord C. Crichton-
Loyd, Arthur T. (Abingdon)Pilditch, Sir PhilipSueter, Rear-Admiral Murray Fraser
Lumley, L. R.Pollock, Rt. Hon. Sir Ernest MurraySugden, Sir Wilfrid H.
Macnaghten, Hon. Sir MalcolmPownall, Lieut.-Colonel AsshetonSykes, Major-Gen. Sir Frederick H.
McNeill, Ronald (Kent, Canterbury)Privett, F. J.Terrell, Captain R. (Oxford, Henley)
Malone, Major P. B. (Tottenham, S.)Raeburn, Sir William H.Thompson, Luke (Sunderland)
Manville, EdwardRaine, W.Thomson, F. C. (Aberdeen, South)
Margesson, H. D. R.Rankin, Captain James StuartTitchfield, Marquess of
Mason, Lieut.-Col. C. K.Rawson, Lieut.-Com. A. C.Tryon, Rt. Hon. George Clement
Mercer, Colonel H.Reid, Capt. A. S. C. (Warrington)Tubbs, S. W.
Milne, J. S. WardlawReid, D. D. (County Down)Turton, Edmund Russborough
Mitchell, W. F. (Saffron Walden)Rentoul, G. S.Vaughan-Morgan, Col. K. P.
Mitchell, Sir W. Lane (Streatham)Reynolds, W. G. W.Wallace, Captain E.
Molloy, Major L. G. S.Rhodes, Lieut.-Col. J. P.Ward, Col. L. (Kingston-upon-Hull)
Molson, Major John ElsdaleRichardson, Sir Alex, (Gravesend)Waring, Major Walter
Moore, Major-General Sir Newton J.Richardson, Lt.-Col. Sir P. (Chertsey)Watson, Capt. J. (Stockton-on-Tees)
Moore-Brabazon, Lieut.-Col. J. T. C.Roberts, Samuel (Hereford, Hereford)Watts, Dr. T. (Man., Withington)
Morrison, Hugh (Wilts, Salisbury)Robertson-Despencer, Major (Isl'gt'n W.)Wells, S. R.
Morrison-Bell, Major A. C. (Honiton)Roundell, Colonel R. F.Wheler, Col. Granville C. H.
Murchison, C. K.Ruggles-Brise, Major E.White, Col. G. D. (Southport)
Nall, Major JosephRussell, Alexander West (Tynemouth)Wilson, Col. M. J. (Richmond)
Nesbitt, Robert C.Russell-Wells, Sir SydneyWinterton, Earl
Newman, Colonel J. R. P. (Finchley)Samuel, A. M. (Surrey, Farnham)Wise, Frederick
Newman, Sir R. H. S. D. L. (Exeter)Samuel, Samuel (W'dsworth, Putney)Wolmer, Viscount
Newson, Sir Percy WilsonSanders, Rt. Hon. Sir Robert A.Woodcock, Colonel H. C.
Newton, Sir D. G. C. (Cambridge)Sanderson, Sir Frank B.Yerburgh, R. D. T.
Nicholson, Brig.-Gen. J. (Westminster)Sandon, Lord
Nicholson, William G. (Petersfield)Shepperson, E. W.TELLERS FOR THE AYES.—
Nield, Sir HerbertShipwright, Captain D.Colonel Leslie Wilson and Colonel
Norton-Griffiths, Lieut.-Col. Sir JohnSkelton, A. N.Gibbs.
Ormsby-Gore, Hon. WilliamSmith, Sir Harold (Wavertree)
NOES.
Adams, D.Grenfell, D. R. (Glamorgan)Marshall, Sir Arthur H.
Adkins, Sir William Ryland DentGroves, T. E.Maxton, James
Alexander, A. V. (Sheffield, Hillsbro')Grundy, T. W.Millar, J. D.
Attlee, C. R.Guest, J. (York, Hemsworth)Moreing, Captain Algernon H.
Barnes, A.Guthrie, Thomas MauleMorrison, R. C. (Tottenham, N.)
Batey, JosephHall, F. (York, W. R., Normanton)Mosley, Oswald
Benn, Captain Wedgwood (Leith)Hall, G. H. (Merthyr Tydvil)Muir, John W.
Berkeley, Captain ReginaldHamilton, Sir R. (Orkney & Shetland)Murnin, H.
Bonwick, A.Harbord, ArthurMurray, Hon. A. C. (Aberdeen)
Bowerman, Rt. Hon. Charles W.Hardie, George D.Murray, John (Leeds, West)
Briant, FrankHarris, Percy A.Murray, R. (Renfrew, Western)
Brotherton, J.Hay, Captain J. P. (Cathcart)Newbold, J. T. W.
Brown, James (Ayr and Bute)Hayday, ArthurNichol, Robert
Buchanan, G.Hayes, John Henry (Edge Hill)O'Grady, Captain James
Buckle, J.Henderson, Rt. Hon. A. (N'castle, E.)Paling, W.
Burnie, Major J. (Bootle)Henderson, T. (Glasgow)Parkinson, John Allen (Wigan)
Buxton, Charles (Accrington)Henderson, Sir T. (Roxburgh)Phillipps, Vivian
Cairns, JohnHerriotts, J.Ponsonby, Arthur
Cape, ThomasHill, A.Potts, John S.
Chapple, W. A.Hirst, G. H.Pringle, W. M. R.
Charleton, H. C.Hodge, Lieut.-Col. J. P. (Preston)Rees, Sir Beddoe
Clarke, Sir E. C.Hutchison, Sir R. (Kirkcaldy)Richards, R.
Collins, Sir Godfrey (Greenock)Jarrett, G. W. S.Richardson, R. (Houghton-le-Spring)
Collison, LeviJohn, William (Rhondda, West)Riley, Ben
Cotts, Sir William Dingwall MitchellJohnston, Thomas (Stirling)Ritson, J.
Cowan, D. M. (Scottish Universities)Jones, Henry Haydn (Merioneth)Roberts, C. H. (Derby)
Darbishire, C. W.Jones, Morgan (Caerphilly)Robertson, J. (Lanark, Bothwell)
Davies, Rhys John (Westhoughton)Jones, R. T. (Carnarvon)Robinson, W. C. (York, Elland)
Duffy, T. GavanJones, T. I. Mardy (Pontypridd)Rose, Frank H.
Dunnico, H.Jowett, F. W. (Bradford, East)Russell, William (Bolton)
Ede, James ChuterJowitt, W. A. (The Hartlepools)Saklatvala, S.
Edge, Captain Sir WilliamKenworthy, Lieut.-Commander J. M.Salter, Dr. A.
Emlyn-Jones, J. E. (Dorset, N.)Kirkwood, D.Sexton, James
Entwistle, Major C. F.Lansbury, GeorgeShaw, Thomas (Preston)
Evans, Ernest (Cardigan)Lawson, John JamesShinwell, Emanuel
Fairbairn, R. R.Leach, W.Short, Alfred (Wednesbury)
Falconer, J.Lee, F.Simon, Rt. Hon. Sir John
Foot, IsaacLees-Smith, H. B. (Keighley)Simpson, J. Hope
George, Major G. L. (Pembroke)Linfield, F. C.Sinclair, Sir A.
Gosling, HarryLunn, WilliamSmith, T. (Pontefract)
Gray, Frank (Oxford)M'Entee, V. L.Snowden, Philip
Greenall, T.McLaren, AndrewSpencer, George A. (Broxtowe)
Greenwood, A. (Nelson and Colne)March, S.Stephen, Campbell
Stephenson, Lieut.-Colonel H. K.Warne, G. H.Williams, T. (York, Don Valley)
Sullivan, J.Watson, W. M, (Dunfermline)Wilson, C. H. (Sheffield, Attercliffe)
Thomas, Rt. Hon. James H. (Derby)Watts-Morgan, Lt.-Col. D. (Rhondda)Wilson, R. J. (Jarrow)
Thomas, Sir Robert John (Anglesey)Webb, SidneyWintringham, Margaret
Thorne, G. R. (Wolverhampton, E.)Wedgwood, Colonel Josiah C.Wood, Major M. M. (Aberdeen, C.)
Thorne, W. (West Ham, Plaistow)Welsh, J. C.Wright, W.
Thornton, M.Westwood, J.Young, Rt. Hon. E. H. (Norwich)
Trevelyan, C. P.White, H. G. (Birkenhead, E.)
Turner, BenWhiteley, W.TELLERS FOR THE NOES.—
Wallhead, Richard C.Williams, David (Swansea, E.)Mr. Griffiths and Mr. Ammon.
Walsh, Stephen (Lancaster, Ince)Williams, Dr. J. H. (Llanelly)

Motion made, and Question put, "That this House doth agree with the Committee in the said Resolution."

The House divided: Ayes, 222; Noes, 154.

Division No. 109.]AYES.[12.40 a.m.
Agg-Gardner, Sir James TynteEyres-Monsell, Com. Bolton M.Mason, Lieut.-Col. C. K.
Ainsworth, Captain CharlesFalcon, Captain MichaelMercer, Colonel H.
Alexander, Col. M. (Southwark)Falle, Major Sir Bertram GodfrayMilne, J. S. Wardlaw
Amery, Rt. Hon. Leopold C. M. S.Fawkes, Major F. H.Mitchell, W. F. (Saffron Walden)
Apsley, LordFermor-Hesketh, Major T.Molloy, Major L. G. S.
Archer-Shee, Lieut.-Colonel MartinFord, Patrick JohnstonMolson, Major John Elsdale
Ashley, Lt.-Col. Wilfrid W.Forestier-Walker, L.Moore, Major-General Sir Newton J.
Astor, J. J. (Kent, Dover)Foxcroft, Captain Charles TalbotMoore-Brabazon, Lieut.-Col. J. T. C.
Baird, Rt. Hon. Sir John LawrenceFremantle, Lieut.-Colonel Francis E.Morrison, Hugh (Wilts, Salisbury)
Baldwin, Rt. Hon. StanleyFurness, G. J.Morrison-Bell, Major A. C. (Honiton)
Balfour, George (Hampstead)Galbraith, J. F. W.Murchison, C. K.
Banks, MitchellGaunt, Rear-Admiral Sir Guy R.Nall, Major Joseph
Barlow, Rt. Hon. Sir MontagueGoff, Sir R. ParkNesbitt, Robert C.
Barnett, Major Richard W.Gray, Harold (Cambridge)Newman, Colonel J. R. P. (Finchley)
Barnston, Major HarryGreene, Lt.-Col. Sir W. (Hack'y, N.)Newman, Sir R. H. S. D. L. (Exeter)
Bell, Lieut.-Col. W. C. H. (Devizes)Guinness, Lieut.-Col. Hon. W. E.Newson, Sir Percy Wilson
Bellairs, Commander Carlyon W.Gwynne, Rupert S.Nicholson, Brig.-Gen. J. (Westminster)
Bennett, Sir T. J. (Sevenoaks)Hacking, Captain Douglas H.Nicholson, William G. (Petersfield)
Berry, Sir GeorgeHall, Lieut.-Col. Sir F. (Dulwich)Nield, Sir Herbert
Betterton, Henry B.Halstead, Major D.Norton-Griffiths, Lieut.-Col. Sir John
Birchall, Major J. DearmanHamilton, Sir George C. (Altrincham)Ormsby-Gore, Hon. William
Blades, Sir George RowlandHannon, Patrick Joseph HenryPaget, T. G.
Bowyer, Capt. G. E. W.Harmsworth, Hon. E. C. (Kent)Parker, Owen (Kettering)
Boyd-Carpenter, Major A.Harrison, F. C.Pease, William Edwin
Brassey, Sir LeonardHarvey, Major S. E.Pennefather, De Fonblanque
Bridgeman, Rt. Hon. William CliveHawke, John AnthonyPenny, Frederick George
Briggs, HaroldHay, Major T. W. (Norfolk, South)Percy, Lord Eustace (Hastings)
Brittain, Sir HarryHennessy, Major J. R. G.Perkins, Colonel E. K.
Brown, Major D. C. (Hexham)Herbert, S. (Scarborough)Pielou, D. P.
Bruton, Sir JamesHerbert, Dennis (Hertford, Watford)Pilditch, Sir Philip
Buckingham, Sir H.Hilder, Lieut.-Colonel FrankPollock, Rt. Hon. Sir Ernest Murray
Buckley, Lieut.-Colonel A.Hiley, Sir ErnestPownall, Lieut.-Colonel Assheton
Burney, Com. (Middx., Uxbridge)Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.Privett, F. J.
Butcher, Sir John GeorgeHogg, Rt. Hon. Sir D. (St. Marylebone)Raeburn, Sir William H.
Butler, H. M. (Leeds, North)Hohler, Gerald FitzroyRaine, W.
Button, H. S.Holbrook, Sir Arthur RichardRankin, Captain James Stuart
Camplon, Lieut.-Colonel W. R.Hood, Sir JosephRawson, Lieut.-Com. A. C.
Cassels, J. D.Hopkins, John W. W.Rees, Sir Beddoe
Cayzer, Sir C. (Chester, City)Hopkinson, A. (Lancaster, Mossley)Reid, Capt. A. S. C. (Warrington)
Chapman, Sir S.Howard, Capt. D. (Cumberland, N.)Reid, D. D. (County Down)
Churchman, Sir ArthurHoward-Bury, Lieut.-Col. C. K.Rentoul, G. S.
Clarry, Reginald GeorgeHudson, Capt. A.Reynolds, W. G. W.
Clayton, G. C.Hume, G. H.Rhodes, Lieut.-Col. J. P.
Cobb, Sir CyrilInskip, Sir Thomas Walker H.Richardson, Lt.-Col. Sir P. (Chertsey)
Cockerill, Brigadier-General G. K.James Lieut.-Colonel Hon CuthbertRoberts, Samuel (Hereford, Hereford)
Colfox, Major Wm. PhillipsJenkins, W. A. (Brecon and Radnor)Robertson-Despencer, Major (Isl'gt'n W.)
Cope, Major WilliamJephcott, A. R.Roundell, Colonel R. F.
Courthope, Lieut.-Col. George L.Jodrell, Sir Neville PaulRuggles-Brise, Major E.
Craig, Captain C. C. (Antrim, South)Kennedy, Captain M. S. NigelRussell, Alexander West (Tynemouth)
Craik, Rt. Hon. Sir HenryKing, Captain Henry DouglasRussell-Wells, Sir Sydney
Curzon, Captain ViscountKinloch-Cooke, Sir ClementSamuel, A. M. (Surrey, Farnham)
Davidson, J. C. C. (Hemel Hempstead)Lamb, J. Q.Samuel, Samuel (W'dsworth, Putney)
Davidson, Major-General Sir J. H.Lane-Fox, Lieut.-Colonel G. R.Sanders, Rt. Hon. Sir Robert A.
Davies, Alfred Thomas (Lincoln)Leigh, Sir John (Clapham)Sanderson, Sir Frank B.
Davison, Sir W. H. (Kensington, S.)Lloyd, Cyril E. (Dudley)Sandon, Lord
Dawson, Sir PhilipLorimer, H. D.Shepperson, E. W.
Dixon, C. H. (Rutland)Lort-Williams, J.Shipwright, Captain D.
Du Pre, Colonel William BaringLougher, L.Skelton, A. N.
Edmondson, Major A. J.Loyd, Arthur Thomas (Abingdon)Smith, Sir Harold (Wavertree)
Ednam, ViscountLumley, L. R.Somerville, Daniel (Barrow-in-Furness)
Elliot, Capt. Walter E. (Lanark)Macnaghten, Hon. Sir MalcolmSparkes, H. W.
Ellis, R. G.McNeill, Ronald (Kent, Canterbury)Spears, Brig.-Gen. E. L.
England, Lieut.-Colonel A.Malone, Major P. B. (Tottenham, S.)Spender-Clay, Lieut.-Colonel H. H.
Erskine, James Malcolm MonteithManville, EdwardStanley, Lord
Erskine-Bolst, Captain C.Margesson, H. D. R.Steel, Major S. Strang
Stott, Lt.-Col. W. H.Turton, Edmund RussboroughWilson, Col. M. J. (Richmond)
Stuart, Lord C. Crichton-Vaughan-Morgan, Col. K. P.Winterton, Earl
Sueter, Rear-Admiral Murray FraserWallace, Captain E.Wise, Frederick
Sugden, Sir Wilfrid H.Ward, Col. L. (Kingston-upon-Hull)Wolmer, Viscount
Sykes, Major-Gen. Sir Frederick H.Waring, Major WalterWoodcock, Colonel H. C.
Terrell, Captain R. (Oxford, Henley)Watson, Capt. J. (Stockton-on-Tees)Yerburgh, R. D. T.
Thompson, Luke (Sunderland)Watts, Dr. T. (Man., Withington)
Thomson, F. C. (Aberdeen, South)Wells, S. R.TELLERS FOR THE AYES.—
Titchfield, Marquess ofWheler, Col. Granville C. H.Colonel Leslie Wilson and Colonel
Tryon, Rt. Hon. George ClementWhite, Col. G. D. (Southport)Gibbs.
Tubbs, S. W.
NOES.
Adams, D.Harbord, ArthurPringle, W. M. R.
Adkins, Sir William Ryland DentHardie, George D.Richards, R.
Alexander, A. V. (Sheffield, Hillsbro')Hay, Captain J. P. (Cathcart)Richardson, R. (Houghton-le-Spring)
Attlee, C. R.Hayday, ArthurRiley, Ben
Barnes, A.Hayes, John Henry (Edge Hill)Ritson, J.
Batey, JosephHenderson, Rt. Hon. A. (N'castle, E.)Roberts, C. H. (Derby)
Benn, Captain Wedgwood (Leith)Henderson, T. (Glasgow)Robertson, J. (Lanark, Bothwell)
Berkeley, Captain ReginaldHenderson, Sir T. (Roxburgh)Robinson, W. C. (York, Elland)
Bonwick, A.Herriotts, J.Rose, Frank H.
Bowerman, Rt. Hon. Charles W.Hill, A.Russell, William (Bolton)
Briant, FrankHirst, G. H.Saklatvala, S.
Broad, F. A.Hodge, Lieut.-Col. J. P. (Preston)Salter, Dr. A.
Brotherton, J.Hutchison, Sir R. (Kirkcaldy)Sexton, James
Brown, James (Ayr and Bute)Jarrett, G. W. S.Shinwell, Emanuel
Buchanan, G.John, William (Rhondda, West)Short, Alfred (Wednesbury)
Buckle, J.Johnston, Thomas (Stirling)Simon, Rt. Hon. Sir John
Burnie, Major J. (Bootle)Jones, Henry Haydn (Merioneth)Simpson, J. Hope
Butler, J. R. M. (Cambridge Univ.)Jones, Morgan (Caerphilly)Sinclair, Sir A.
Buxton, Charles (Accrington)Jones, R. T. (Carnarvon)Smith, T. (Pontefract)
Cairns, JohnJones, T. I. Mardy (Pontypridd)Spencer, George A. (Broxtowe)
Cape, ThomasJowett, F. W. (Bradford, East)Stephen, Campbell
Chapple, W. A.Jowitt, W. A. (The Hartlepools)Stephenson, Lieut.-Colonel H. K.
Charleton, H. C.Kenworthy, Lieut.-Commander J. M.Sullivan, J.
Clarke, Sir E. C.Kirkwood, D.Thomas, Sir Robert John (Anglesey)
Collins, Sir Godfrey (Greenock)Lansbury, GeorgeThorne, G. R. (Wolverhampton, E.)
Collison, LeviLawson, John JamesThorne, W. (West Ham, Plaistow)
Cotts, Sir William Dingwall MitchellLeach, W.Thornton, M.
Cowan, D. M. (Scottish Universities)Lee, F.Trevelyan, C. P.
Darbishire, C. W.Lees-Smith, H. B. (Keighley)Turner, Ben
Davies, Rhys John (Westhoughton)Linfield, F. C.Wallhead, Richard C.
Duffy, T. GavanLunn, WilliamWalsh, Stephen (Lancaster, Ince)
Dunnico, H.M'Entee, V. L.Warne, G. H.
Ede, James ChuterMcLaren, AndrewWatson, W. M. (Dunfermline)
Edge, Captain Sir WilliamMarch, S.Watts-Morgan, Lt.-Col. D. (Rhondda)
Emlyn-Jones, J. E. (Dorset, N.)Marshall, Sir Arthur H.Webb, Sidney
Entwistle, Major C. F.Maxton, JamesWedgwood, Colonel Josiah C.
Evans, Ernest (Cardigan)Millar, J. D.Welsh, J. C.
Fairbairn, R. R.Moreing, Captain Algernon H.Westwood, J.
Falconer, J.Mosley, OswaldWhite, H. G. (Birkenhead, E.)
Foot, IsaacMuir, John W.Whiteley, W.
George, Major G. L. (Pembroke)Murnin, H.Williams, David (Swansea, E.)
Gosling, HarryMurray, Hon. A. C. (Aberdeen)Williams, Dr. J. H. (Llanelly)
Gray, Frank (Oxford)Murray, John (Leeds, West)Williams, T. (York, Don Valley)
Greenall, T.Murray, R. (Renfrew, Western)Wilson, C. H. (Sheffield, Attercliffe)
Greenwood, A. (Nelson and Colne)Newbold, J. T. W.Wilson, R. J. (Jarrow)
Grenfell, D. R. (Glamorgan)Nichol, RobertWintringham, Margaret
Groves, T.O'Grady, Captain JamesWood, Major M. M. (Aberdeen, C.)
Grundy, T. W.Paling, W.Young, Rt. Hon. E. H. (Norwich)
Guest, J. (York, Hemsworth)Parkinson, John Allen (Wigan)Young, Robert (Lancaster, Newton)
Guthrie, Thomas Mau[...]ePhillipps, Vivian
Hall, F. (York, W. R., Normanton)Ponsonby, ArthurTELLERS FOR THE NOES.—
Hall, G. H. (Merthyr Tydvil)Potts, John S.Mr. Griffiths and Mr. Ammon.
Hamilton, Sir R. (Orkney & Shetland)

Resolution agreed to.

Photo of Sir William Adkins Sir William Adkins , Middleton and Prestwich

I beg to move, in paragraph (a), to leave out the words "and sixpence" ["at the rate of four shillings and sixpence"]

I desire, in moving this Amendment, rather to state in a few sentences the issue which is thereby presented to the House than to argue in any detail the matter which that raises and is intended to raise one of the gravest issues arising out of the Budget which the House is considering. But I will ask the House to note that the proceedings of this evening have decided, so far as can be decided by these Resolutions, that there is to be no alteration of any other proposal in the Budget. The Amendment for the reduction of the Tea Duty, the Amendment for making the brewers pay a larger proportion of the desirable reduction in the cost of beer, the Amendment to abolish the duties which the House has been discussing for the last hour and a half have met with a firm monotony of refusal on the part of the Government. Accordingly, we are now face to face with the question whether at this time and in this Budget the Income Tax is to be at 4s. 6d. instead of 5s. of last year or 4s., which those of us who are putting forward this Amendment would seek to have it fixed.

The House has fresh, in its mind the animated and interesting debates which arose on this point when the Budget was introduced. We have read with great interest the selected quotations from dead Statesmen. We have heard Leaders of different parties make use of rhetorical exchanges across the floor of the House and we at any rate have had this advantage, apart from the intellectual pleasure incident to such experience—we have had at any rate this advantage that we know that the Government to-day consider that there should be no further Debt reduction, although they have experienced a realised surplus of more than £100,000,000 than we budgeted for, presumably unexpected but of course, used for actual reduction of Debt. I am not going to suggest for a moment that an unexpected realised surplus, particularly in times like these, ought to be devoted exclusively and entirely to the remission of taxation. But it is worth while to bear in mind that the occurrence of that realised surplus has put the Government and the country in a far better position than that in which they would otherwise have been. Therefore the constantly recurring argument between reduction of debt and reduction of taxation inclines to the latter alternative with greater force because of this fact that £100,000,000 surplus has been realised in the past year.

1.0 a.m.

If that be so, we are in this country at this time faced with the very difficult inquiry as to which method is likely to bring about to the greatest degree that revival of trade, that stimulus of commercial energy, that heartening of the energies of the country, all of which are so much needed in a period when we are still suffering from the reaction in every shape and way of the great war. Those who will support this Amendment take the view that the reduction of this tax by the Government is not adequate. We believe that you will get more real bene- fit to the financial prosperity of the country by increasing the reduction of this particular tax, and I venture to put these reasons before the House. I desire to adopt and to accept the statement, made with his usual high felicity of phrase by my right hon. Friend the Member for Paisley (Mr. Asquith) in the debate on the introduction of the Budget. He used these memorable words with regard to the effect of an Income Tax. The effect of an Income Tax is not merely to control enjoyments and comforts of a largo number of our middle classes; its effect is to dry up the stream which fertilises the whole field of employment and of industry. I believe that to be as absolutely true in its meaning as it is admirable in its expression. And if it be true that that is the effect of Income Tax, particularly at a time like this, surely one would urge upon any Government the duty of doing everything they can to prevent and to counteract the drying up of that stream which fertilises the whole field of employment and of industry. I desire to give to the House, not as an argument covering the whole field of this statement, but as an illustration which occurs to me as to the truth of this and the importance of it, a matter which occurs and is occurring to-day in the county of Lancashire in connection with the great cotton trade. It has been the custom there for many years for the cost of erecting mills and for the cost of carrying on cotton spinning to raise large sums of money by loans and it has been the custom to a very large extent for these loans to be taken up by artisans and by others who are not persons of considerable means. These loans have carried a certain rate of interest free of Income Tax. Accordingly, the amount of Income Tax has become of exceptional importance with regard to those responsible for such mills to carry them on in a way that gave security of fullness of employment and which promoted good trade. Only two or three days ago, in one of the Committee rooms of this House, a large and representative deputation from Lancashire comprising people of all political pre-dispositions assured us that the reduction of Income Tax was of the greatest importance in this matter, that the reduction of sixpence which is promised and for which the Government made themselves responsible would mean a matter of £200,000 with regard to the cotton industry in this particular. The reduction of one shilling which I ask the House to approve of would mean to the industry a sum of no less than £400,000, and because that industry, which is one of the principal in these islands, is suffering from so widespread depression in consequence of the unstable and variable exchanges, particularly in those parts of the East to which a large proportion of the export trade goes, it becomes all the more important that this House should consider whether it cannot remedy that to which the policy of this House can apply. May I add another matter? It is not only that a lower Income Tax would directly stimulate trade and industry, but it would also have an effect on the middle class generally. If you take the people of this country whose incomes are between £200 and £2,000, they are the persons who have borne exceptionally the woes and losses and trials of the War. They have neither the power of great capital which can be used by those who are better off, nor have they, as a rule, the power to combine which the workers possess. The middle class is composed of persons whose incomes are worth far less than they wore before the War. Therefore to them a reduction of Income Tax is of special importance, and the reduction which I am suggesting to the House would, I am confident, have the greatest effect upon them. It would give them a new heart and a new stimulus. No country is healthy in which the middle class is not vigorous, healthy and enterprising. The middle class is necessary to the prosperity and the stability of the State, and where-ever they have been long depressed the State as a whole has suffered. There is nothing in this Budget which would have a better effect upon this much tried section of the community as would be a further reduction in the Income Tax such as I ask the House to approve.

How can it be done? The proposal of the Chancellor of the Exchequer is to put aside for Sinking Fund an amount of £40,000,000. In order to get another sixpence off the Income Tax £19,000,000 of that would be required. Is it bad finance, is it unjust at a time when there has been a surplus of more than £100,000,000 that a sum of about £20,000,000 should be set aside to reduce the Income Tax from five shillings to four shillings? You cannot help our country on towards that prosperity which we all desire unless you balance with the utmost care the claims of debt payment on the one hand with the necessary stimulus to trade on the other, in order that people may be encouraged to put a spirit of enterprise into what they are doing. Because I am convinced that this spirit would be brought about by the reduction which I propose. I venture to recommend my proposal to the House.

Photo of Lieut-Colonel Henry Stephenson Lieut-Colonel Henry Stephenson , Sheffield Park

I beg to second the Amendment.

This is a proposal which should have the sympathy of every taxpayer in this House. The evils of the Income Tax are sufficiently well known. One of these is the ease with which the tax is collected, which puts a premium on Government extravagance. Mr. Gladstone attributed Government extravagance to the ease with which Income Tax could be collected. To-day the Income Tax and the Super-tax constitute a burden which we may call almost intolerable, a burden which the right hon. Gentleman the Member for Paisley (Mr. Asquith) said amounted to a modified form of a capital levy. The right hon. Gentleman also went on to say that there were no people who should be more interested in a reduction of the Income Tax than those who made their living by the work of their hands. From that I would like to argue that Income Tax does not affect only the middle classes, it filters down to those who are poorest of all. I do not think there is any hon. Member of the House who would fail to agree with the argument put forward by the hon. and learned Member who has preceded me or with the words he quoted which were used by the hon. Member for Paisley last Tuesday. I am not prepared at this late hour to try and improve upon the case so put, but I want to ask the House to consider what the Chancellor of the Exchequer has given us. I will not say that when we asked for bread he gave us a stone, but he has given us half a loaf at the time he could have afforded to give us a whole one. If the late Chancellor of the Exchequer in addition to the remissions he gave had also given us the remissions which the present Chancellor of the Exchequer has now given, he would still have had a gigantic sum for the redemption of debt. It appears to me that the present Chancellor of the Exchequer will have a surplus sufficient for the redemption of debt if he can see his way to give us this extra sixpence. I for one am not prepared to believe that we have come to the end of the reductions of expenditure, and I ventured the other night to point out some of the directions in which he might look for these reductions. I am quite sure the circumstances are such that, having regard to the improved conditions of trade and the facility with which, I believe, further reductions of expenditure can be made, we are justified in asking for the full shilling and pressing that reduction upon the Chancellor of the Exchequer.

Photo of Mr Stanley Baldwin Mr Stanley Baldwin , Bewdley

I listened with much interest to the case put forward by the hon. Member for Middleton (Sir R. Adkins) and the hon. Member for the Park Division of Sheffield (Lieut.-Colonel Stephenson). I quite appreciate their desire to have a larger reduction in the Income Tax than I have found I could fairly and consistently recommend this year. There are one or two objections which strike one in the first place to accepting this Amendment. An additional sixpence off the Income Tax means another £19,000,000 this year and £26,000,000 next year. Now in a year when I have already gone further in this direction than some hon. Members think I ought to have gone with safety in suggesting remission of taxation, it is perfectly impossible for me, with the Budget as it stands now, to offer any more remission in this direction. So we come to the point. Where do my hon. Friends expect to get £19,000,000 this year and £26,000,000 next year? I was not quite clear, from the hon. Member for Middleton's speech, but I was rather under the impression that, so far as this year went, it might be possible to get something by raiding the Sinking Fund. Of course that would mean borrowing. You would begin by borrowing £19,000,000, and paying interest upon it—going to the market for remitting Income Tax. Then there would be £26,000,000 next year. Now, supposing there were no surplus next year and so no old Sinking Fund. Where is that £26,000,000 to come from, not only for next year but future years? You would hardly suggest you should go on borrow- ing if there was no surplus. If, on the other hand, you were to raid my suggested New Sinking Fund, it would mean that you would have then instead of providing out of revenue your Sinking Fund for the American Debt which has to be paid in the next 12 months with dollars in New York, money for the last payment but one of the Pitman Silver Account, of the difference between the face value and the market value of Victory bonds tendered for Death Duties—it would mean for all those payments you would borrow, you would have to go into the market for £19,000,000. You would be borrowing against the recurrent charges which, I think, should be put into the New Sinking Fund. That, having been done this year, would have to be continued on a greater scale next year and so on ad infinitum, and you would lose the whole of the benefit.

Assuming I have been right in the premises I laid down during the Budget, you would lose the whole of the advantage from the provision of that Sinking Fund. It really, in effect, becomes a direct challenge to the financial policy of the Government.

That brings me to another question. If we had been contemplating the finances of any other country, instead of complaining of meagre remissions this year, we should have been extolling and exalting the finances of that country for the amount of taxes they had given away. It is a tremendous thing, within so short a period of the termination of war, to have made such substantial reductions as have been made last year and this in tea, beer and Income Tax. I am proposing a remission which brings up the total remission on Income Tax in two years to 1s. 6d. I think it might well be asked by many other sections of the community whether, if you are going beyond the remission in this year's Budget, there are not many other claims besides those of Income Tax which have an equal call upon you.

I am aware that the voice of industry to-day is clamant for further remission, but let me remind the House of this. Where trade is bad people are grasping at anything they think will bring them some consolation or some better trade. What has really hit industry so much in the last two years has not been primarily taxation—and do not misunderstand me; I am not saying high taxation is a good thing—but the fact that there was a most appalling fall in prices—a ghastly slump in trade that rendered every business, almost., the possesor of stocks acquired at high prices which it had to liquidate as best it could. Businesses found themselves, when plunged in the trough of the wave of trade depression, liable for taxation which had become due to the Government in respect of the large profits they had made during good times. It so happens that businesses and individuals have, in this last year or two, had to pay in taxes as much, if not more, than they have made.

That undoubtedly is extremely hard and that is why so many businesses have found it difficult to find enough liquid cash with which to pay their debts to the Government and why so many private persons have either had to sell out their investments or borrow from their bankers Now that state of things, terrible as it may have been in many cases, is slowly passing away and we believe the worst of it is over. It may be some consolation for an industry in the straits in which the hon. Member for Middleton indicated, an industry with which he was familiar, was to have a reduction in Income Tax. But if the troubles of that industry arise from conditions of exchange or conditions of markets where trade has fallen off, no amount of reduction of Income Tax will necessarily provide orders. After all, whatever the psychological effect of a sixpenny reduction in the Income Tax may be, there is only one ultimate way to bring trade and that is to find a man with an order to give and money to pay for it when he gives it. That is what a business man wants and, provided orders are coming along, he can do business profitably whether under a high or low Income Tax as was perfectly well proved in 1919 and 1920.

I suggest with deference to my hon. Friends who moved this Amendment that, if they would be content to take a division on this soon, we might be able to get home and go to bed. I have no objection to sitting up in the least, but I was going to point out that this is a subject that can be discussed, that must be discussed, when we come to the Com- mittee stage of the Finance Bill, and not only this point, but other relevant points which we are unable to discuss to-night. I have indicated, briefly I admit, but I think fairly, the line of thought which does separate us on this matter. I have laid it before the House and I am perfectly content to leave it with my hon. Friends, whether or not they choose to pursue the subject much longer to-night. In any case, we shall be prepared when the time comes to take a decision upon it.

Mr. HILTON YOUNG:

I recognise it is a late hour to enter into a discussion on the fundamental point of the Budget this year. Nevertheless, it is the first occasion on which the subject can be raised. I think it is our duty to the House and to our constituents to raise the matter in the most prominent and decided manner we can. Accordingly, if my hon. Friend the Member for Middleton (Sir H. Adkins) presses it to a Division, I will support him in the Division Lobby. The Chancellor of the Exchequer says a reduction in the Income Tax does not bring orders. Surely he is only thinking of orders from a foreign market. Surely it tends to bring orders in the home market, to increase demand by increasing the purchasing power of the taxpayer and by reducing costs. He appeals to those more interested in the reduction of indirect taxation. Let those hon. Members remember that we have been refused all reduction in indirect taxation and that this is the only means of securing a reduction in taxation. I appeal to them on those grounds to support this Amendment. Is there anybody who doubts that the gain to everybody in this country, whether man or woman, is most widespread, from the reduction of the Income Tax? If I did not believe that, I would not support the Amendment. It is because I am convinced that the benefit from this reduction will be spread over the whole manhood and womanhood of the country that I support it.

The Chancellor of the Exchequer challenged us as to where the money could be obtained and suggested it could only be obtained by borrowing. Let me suggest that there are other ways. Has he calculated his surplus of revenue? There is the question of his estimate of revenue. He cannot prophesy what the revenue will be, but, in a year in which he says trade is improving, to estimate a reduction of £61,000,000 in the yield of revenue is not erring on the side of optimism. In his estimates of expenditure for this year he has estimated for no reduction of expenditure on the actual expenditure of last year. I say that in so estimating he has not done himself justice. I am confident, with his record of economising, with the machinery for economising he has now at his disposal, he will be able to effect very substantial economies in this year's expenditure which will increase his surplus, and this ought to be taken into consideration now. In the last resort, if it is necessary to borrow, what does that mean? It means borrowing with one hand to pay off debt with the other. He calls it a bad thing. I quite agree. It is a bad thing and ought to be avoided if possible. Nevertheless, if you come to the conclusion from financial considerations that you ought to put only so much to the sinking funds this year and you have legal obligations to pay a bigger sum than you can afford, it is better to borrow to pay off what you cannot afford to raise in taxation than to keep this burden of taxation pressing on the industries of the country. There will be, as he rightly said, a further opportunity of thrashing out the matter and I leave it there.

Photo of Mr Clement Attlee Mr Clement Attlee , Stepney Limehouse

I rise to oppose both the Amendment and the proposals of the Chancellor of the Exchequer to reduce the Income Tax. I do not think there are many on these benches who will be prepared to accept the kind invitation of the right hon. Member for Norwich (Mr. Hilton Young) that, having failed in their efforts to get anything off the taxes themselves, they should join with the managerial class so well represented by the hon. Member for Middleton (Sir R. Atkins). We have to look at this matter of taking off the Income Tax from a different angle. We always have put forward the case of the poor Income Tax payer with only a very small amount to live on. The hon. Member for Middleton talks of the pensioner just as the slave trader always talked of the poor woman with only a few strong slaves. They always forget that the great mass of the Income Tax comes from the wealthy people who pay Super-tax. They seem to think that all industry consists of people with small businesses and that relief from Income Tax goes directly to those businesses. But the great mass of people who pay Income Tax get it for the work of cutting off the coupons. Bigger dividends may, of course, be a stimulus in using the scissors and so assist the industry of the country. Whenever one lifts the burden of taxation, one must consider the utility of the amount of money remitted to the taxpayer. When you remit it to the lower class of Income Tax payer the more advantage it was to him, but the higher you get up the scale the amount of money released to him is of less and less importance. The money which is realised for the poorest Income Tax payer will go for necessaries. What is given to the highest Income Tax payer will go in luxuries, and even though it may not go in luxuries it will go as capital. Assuming that it is spent, it will be spent on luxuries, and that means you are setting this country to work to produce luxuries and not necessities. A Budget like this is not merely a financial matter. If you give more money to the people who have enough they spend it on luxuries. You may encourage trade, but you encourage trades that are a waste to this country, and I claim this reduction of Income Tax, while it might be well to give it, if you could afford it, to the workers of this country, is wrong if you consider the needs of the different classes of the population, the poorest of the poor, the woman in the home, the pensioner and so on.

When we ask something for them we are told that we cannot possibly do that. Then we have someone asking for more than sixpence off the Income Tax. They say sixpence is not enough and they must have a shilling. It reminds me of the story of the helping of pudding and the child which asked, "Is all this for grand-pa?" "No," said the mother. "It is yours." "What a little bit!" replied the child. That is the attitude of the Gentlemen who are asking for this further reduction. When it is something for the workers it cannot be given. When it is something for the middle class and the capitalist class they want twice as much. What you have to look at is not what is taken away, but what is left. The only suggestion put forward why we should remit this Income Tax is the need of capital. You are taking the worst possible method. If you want capital, and we admit you want capital, there is no reason why we should give that money first of all to the very rich in order that they may invest it and receive a dividend. We need not go to the extent of giving this £19,000,000 or whatever it may be in the last two years, £40,000,000 or £50,000,000, into the hands of people who will invest it in industries. Why should not that have been retained and the tax not remitted at all, but directed into the channels of the necessities of this country. You could have taken this money and put it straight away into housing and the provision of houses. By this means you would have set the wheels of industry going, employed held in the building trade, and in other ways. Our method of raising capital is that we give persons so much off the Income Tax to spend it on business and then hope that they may save a little for the benefit of the country. You may as well give children enough money to get all the jam to make them sick and then hope that they will have twopence left to put into the Missionaries' box. I suggest that we should not only oppose this Amendment but also the proposal of the Chancellor of the Exchequer, and that this remission for Income Tax should not be given but that the sum should be retained as a national asset and used to set the wheels of industry going in the provision of the necessities of the people.