Amendment of Law.

Part of Orders of the Day — Ways and Means. – in the House of Commons on 22nd April 1936.

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Photo of Mr William Mabane Mr William Mabane , Huddersfield

Certainly, I agree, but the hon. Gentleman will agree also that any appeals by the Chancellor of the Exchequer for increased revenue are resisted by this House. If the House has to consider not merely a Supplementary Estimate but greater taxation in order to meet it, there is a greater chance that the Supplementary Estimate will not only not be presented but that it will be refused by the House if it is presented. In the next year the Supplementary Estimate tends to become normal. The hon. Member for Aylesbury has powerfully presented to the House the rising expenditure with which the country has been faced in the last few years. It is necessary that the House should pay increasing attention to this matter of economy, because it seems that we are in danger of proceeding from financial crisis to financial crisis. We have a crisis, a committee is appointed, the axe is wielded with not much discrimination, we get the Budget down to normal figures, and then we sit back after the virtuous chastening and the figures mount until we reach the figure of crisis.

I think that there are grounds for believing that we are again approaching that figure of crisis. Whereas in 1934–35 the issues from the Exchequer for expenditure amounted to £696,000,000, the issues which are provided this year amount to £798,000,000, an increase of no less than £102,000,000 in two years. I know very well that Defence counts for a lot of that, and that the Defence Estimates show an increase of more than 60 per cent. in the last three years. I make no comment on that, because we are not deciding that issue this afternoon, but there has been also a substantial increase in the amount of the Civil Votes. They show in only one case a decline—in the amount of war pensions, the reasons for which we know and lament. As to the rest, consider what they are: Vote II, Foreign and Imperial, an increase again, compared with 1933–34, of £3,000,000; Vote III, the Home Office, £3,000,000; Vote IV, Education, £7,000,000; Health, Labour and Insurance notwithstanding the decline in unemployment, £8,000,000; Trade and Industry, £7,000,000; and even my right hon. Friend the First Commissioner of Works has managed to spend another £500,000. These Votes account for an crease of £28,500,000.

How long are these increases to continue? Where is the breaking-point to come? Has not the time come when the Government would be wise to institute once more an inquiry into Departmental spending in order to check this increase, or even to bring about a decrease? I feel that unless something of that sort is done we shall reach again the time when a financial crisis is upon us and revenue is insufficient to meet expenditure. I have always held, and done my best to present, the point of view that it is the duty of this House first and foremost to try and secure a lightening of the taxation of the people. Industry is more prosperous and the generality of the people more content when taxes are light. In order to achieve that object we need careful attention to this matter of economy. Therefore, I am bound to say that I object to the two new taxes proposed in this Budget. As to the other proposals, I cannot see how anyone can complain about the methods whereby the Chancellor intends to provide himself with new revenue. Most of us have known of tax avoidance for some time past, and the forms of tax avoidance to which the Chancellor referred have been growing so rapidly that some action was essential to stop the leakage. It is a pity that the Chancellor did not at the same time propose to deal with a form of tax avoidance that depends on the registration of companies in the Isle of Man or the Channel Islands. If he bad included that it would have been an advantage, and I suggest that he should consider it between now and the introduction of the Finance Bill.

Again, I do not think anybody can object to the manner in which the Chancellor proposes to deal with the Road. Fund. It is wrong that revenue should be specifically appropriated for particular purposes, and I do not think there is any reason to believe that, if the Ministry of Transport make their case well, the change will interfere with their work; certainly, if this proposal means that Estimates will have to be presented by the Ministry of Transport, it will have the additional advantage of bringing that Ministry more directly under the control of Parliament. The Chancellor referred in passing to what he described as the Special Areas Reconstruction Association, Limited, and I gather that he imagined the proposal to establish this association would be non-controversial. To some of us the proposal seems dangerously near State banking, or, at any rate, the State putting a finger in a banking pie. We feel that there are considerations in connection with this new proposal that seem alarming, and we shall want to examine it closely when it is made.

Included in the Budget statement this year is a matter of £25,000,000 for supplementary expenditure which is not yet known, not yet submitted to the House, and not yet approved. We know the reason, and apparently the House is prepared to excuse it, but surely it is a most unorthodox thing to do and a most dangerous precedent to set. I want to ask the Chancellor whether the House is to understand that the whole of the defence programme, which we understand is to be spread over five years, is to be dealt with in this fashion, and that instead of having specific Estimates at the beginning of each year, we are to be asked at the beginning of each year to provide Supplementary Estimates for an unspecified expenditure the nature of which we shall not know until the year passes by. The House would be alarmed if that were the proposal, because, while such a method would be quite safe in the hands of the present Chancellor, we have to consider what would happen if others less responsible than he is and with different political and social views were in his place. We may quite properly say that we can trust the present Chancellor to do certain things with financial propriety and yet feel some fear if the same latitude were given to an hon. Member drawn from the party opposite. Therefore, I hope that this method of including Supplementary Estimates in the Budget is not to be regarded as a normal budgetary procedure. It would have been far better to have left out this provision and to have provided the revenue when it was required when the Supplementary Estimates were presented.

The Chancellor, as the right hon. Gentleman the Member for Caithness and Sutherland (Sir A. Sinclair) said, has for the first time omitted any reference to the American debt. I should like to ask what the position is with regard to the American debt.