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thought there might be a Tariff Reform Government after the next election, and, if so, he hoped the question would be discussed as a matter of business. No preference to us would be of value unless colonial tariffs were lowered, and the change, if made, should be so made that it should last.
After a Free-Trade speech from Lord Glantawe, Lord Curzon of Kedleston said that he had been impelled to speak by the references made to the question of India. Sir Edward Law was still in complete agreement with the despatch of October 22, 1903. The Indian Government had not been averse from fiscal retaliation in defence of Indian interests; its real apprehensions had been political-would India have free speech or a free judgment on the question of introducing a new system? Mr. Chamberlain bad contemplated letting her speak through the mouth of her representatives, but the Indian Government had to take its fiscal views from the Secretary of State, whose views would be shaped by English rather than by Indian considerations. If the interests of India were fairly considered and no system forced on her that was unsuited to her own interests, she would welcome any practical system of inter-Imperial preference.
The Marquess of Lansdowne, after condemning the refusal to discuss Colonial Preference at the Conference, expressed some alarm at the Franco-Canadian Convention as a new departure, perhaps the first of a series which would leave Great Britain out. He dealt with various points previously brought out, especially the position of India.
The Earl of Crewe, winding up for the Government, said that the debate was really set up by the Franco-Canadian Convention. It was not negotiated by Canada alone, but the British Ambassador at Paris had been associated with her representatives. It affected little of Canadian or Anglo-Canadian trade, and there were some British gains under it. There were precedents in Canadian history and in the preference given by Newfoundland to the United States in 1902. He admitted the great value of the trade preferences given by the Colonies to Great Britain, but the Colonial Ministers had expected us to adopt preference as part of a policy of Protection; it was impossible otherwise. Were it adopted, the resulting system would be very intricate, and might involve favouring one Colony against another, or India against Great Britain. The issue at the Conference between à Free-Trade and a Protectionist policy was so clear that it was wiser not to complicate it with proposals such as those Lord St. Aldwyn had mentioned. And Protection might be irreversible.
While the Lords were concluding their fiscal debate the Commons were discussing the delays in Irish land purchase and the position of the evicted tenants, on the vote for the Irish Land Commission. The Evicted Tenants Act of 1907 had been modified by the House of Lords in the interest of the “planters” (ANNUAL REGISTER, 1907, p. 213); and the Irish Court of Appeal had interpreted one of the amendments to mean that land occupied by new bond-fide cultivators could not be compulsorily acquired for the benefit of evicted tenants. This decision, it was urged, defeated the aim of the Act, and the Government should introduce an amending Bill. This Mr. Birrell promised (p. 130), saying that he had had misgivings as to the effect of the Lords' action. He stated that in twelve months 562 evicted tenants had been reinstated, 429 by the landlords and 133 by the Commissioners on lands purchased for them. The tenants themselves sometimes refused reinstatement except on their former holdings, and their new neighbours did not always welcome them. Complaints were also made of the understaffing of the Land Commission, and (by Mr. J. H. Campbell) of its unnecessary inquiries, but eventually the discussion was terminated with a view to its revival later in the session with a wider scope. Subsequently a successful issue of Irish Land Stock (July 4) gave some hope of the acceleration of land purchase. (A comprehensive Land Bill was introduced, but not passed, in the autumn session. See post, Chapter V.) Later in the evening the reafforestation of Ireland was pressed on the Government, and Mr. T. W. Russell mentioned that certain preliminary steps had been taken.
A Scottish Local Option Bill was accepted in principle by the House of Commons and the Government on Friday, May 22. It was introduced by Mr. Cameron Corbett (Tradeston, Glasgow), who explained that it would allow the people of a locality to decide, on a requisition signed by one-tenth of its electors, whether licences should be granted in that area or not, or should be reduced in number by one-fourth. He mentioned that 64 out of 72 Scottish constituencies supported local option. The rejection of the Bill was moved and seconded by two English members, Sir F. Banbury and Mr. J. F. Mason, and it was accepted by the Scottish Secretary, Mr. Sinclair, in principle; but, to the disappointment of the Scottish Liberal members, he could not definitely promise legislation for 1909, and proposed to shelve the Bill by reference to a Committee of the whole House. The second reading was carried by 189 to 72, the reference to Committee by 163 to 85. In the latter division the minority consisted of Liberal and Labour members, and the majority in part of Unionists.
It may here be mentioned in anticipation that the readiness of the Government to accept social reforms in principle was manifested several times before the Whitsuntide adjournment. A Thrift and Credit Banks Bill brought into the Upper House by Lord Wenlock, and described by the Marquess of Londonderry as the natural complement of small holdings, thus passed its second reading on May 25. A resolution, moved and seconded by two Labour members, demanding legislative provision for the proper housing of temporary workers, such
as navvies and fruit-pickers-clearly an urgent need, from the cases adduced in the debate-was favourably received by Mr. John Burns, who explained that steps were under consideration for dealing with the subject either by general legislation or special provisions in each private Bill authorising public works. A Public Rights of Way Bill, removing an uncertainty in the law as to the extent to which such rights implied “dedication to public use ” when the land was held by life tenants or others who were not full owners, was approved on both sides of the House and passed its second reading on May 29, by 160 to 13; and a Commons Bill only failed because, coming on unexpectedly, it was talked out. Unfortunately, the achievement of these reforms was of necessity postponed indefinitely.
The Budget resolution reimposing the income tax was passed on Monday, May 25, after a spirited debate. Mr. Austen Chamberlain began it by regretting the inception of old age pensions, pending vast and as yet unknown changes in the poor law. Expenditure had not been and could not be reduced, and he anticipated that in 1909 there would be an increase of at least 10,300,0001. for which the Government had made no provision. Instead of reducing taxation they should have found new sources of revenue. Debt reduction had been aided by cheap Consols; borrowing was still going on for public works (telegraphs and public buildings), and, by using the surplus naval stores, the Government were living on capital. It was a reckless Budget, for a high sinking fund and a low income tax implied the existence of unused emergency reserves. He dealt at some length with the old age pension proposals. The pensions should not be provided out of direct taxation, and contributory schemes should not have been excluded. The scheme proposed discouraged the thrifty and deserving. The age limit was too high, the 10s. limit too low. There ought to be a sliding scale, and old married couples should not be penalised. Apart from old age pensions, he condemned the Budget.
Among subsequent speakers Mr. Ashton (Luton, Beds), a Liberal, urged larger purchases of Consols at the existing low prices, and laid stress on the desirability of reducing debt; Mr. Harold Cox argued that the only sound system for a democratic country was direct taxation of every one according to his means ; Mr. Leverton Harris (Stepney) said that the policy of the Budget must lead to Tariff Reform ; Mr. Ellis (Rushcliffe, Notts) advocated continued retrenchment and unabated repayment of debt, and Mr. Snowden (Blackburn) declared that the “active Socialist section” of the Labour party regarded the Budget partly as a means of redressing social inequalities. The wageearners were relatively poorer than six or seven years before, the income-tax payers richer, and he advocated a graduated tax on incomes over 5,0001. a year. He estimated that there were 16,000 possessors of such incomes, which on the aggregate amounted to 200,000,0001. The death duties, too, might be largely increased. Mr. Harwood (Bolton), as a Liberal and Free Trader, urged the restoration of the export duty on coal. Mr. Bonar Law (Dulwich, Camberwell) subjected the Budget to detailed and severe criticism. He thought it was framed in order to “stop the rot” in the constituencies. The Government had not reduced expenditure, and had only reduced the debt by keeping up taxation. Had not the Irish Councils Bill and the Education Bill of 1906 been rejected, they would have had to spend some millions more. The sugar duty had been reduced though there was a prospect of largely increased expenditure, and at a time when it was not severely felt. He questioned the advisability of lessening the reduction of debt. The “deadweight” debt would at the end of the year be 60,000,0001. more than in 1889, and England was not now so wealthy, relatively to other nations, as formerly. The taxable resources of Germany were greater than those of Great Britain. Direct taxation, State as well as Imperial, was 8s. per head in Germany and 18s. in Great Britain ; indirect taxation 26s. as against 46s. ; and local taxation was notoriously much heavier in England. Germany borrowed to meet current expenditure because she was incompletely unified, but that difficulty would disappear under the stress of war. He condemned the idea of raising increased revenue from the death duties and the income tax. The Unionists desired social reform, but all classes should contribute to it in proportion to their means.
The Chancellor of the Exchequer (Mr. Lloyd-George), after questioning Mr. Bonar Law's account of the financial position of Germany, challenged him to test the unpopularity of the Budget by a division. In two years the Government had arranged to reduce the national liabilities by 41,000,0001. ; their predecessors in ten years had reduced them by only 22,000,0001., and in 1899 had raided the Sinking Fund to avoid increasing taxation. “Accidental” reductions of debt somehow only happened under Liberal Governments. The liabilities of next year would be provided for next year. The resources of Free-Trade finance were not exhausted. The Liberals were pledged to reduce expenditure only on armaments; they had contemplated social reform, which involved increased expenditure. But they had reduced Army and Navy expenditure by 5,000,0001. or 6,000,0001., and he hoped to see further reductions. Borrowing for the telegraph and telephone system, which was productive, was a different thing from borrowing for the purposes of the Army and Navy. The Old Age Pensions Bill would be published shortly, and criticism had better be deferred. A thrift test would be impracticable without a contributory scheme, and the British labouring classes moved about so much that this was impracticable. Those who pleaded for greater consideration for old couples, and for extensions, must remember that the scheme was only an experiment, and that an extension of it would far exceed the available revenue. He hoped provision
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for the infirm would some day be made also. Mr. Snowden's criticisms had been too acrid ; his suggestions might be valuable to future Chancellors. The advocates of a reimposition of the coal tax were thinking of the best coal, but the tax pressed on the inferior coal, which had to compete with Westphalian and French. He agreed with Mr. Ellis that expenditure on armaments was deplorable, and we were as responsible as other countries. Indeed we had possibly forced the pace in the matter of shipbuilding. If increased taxation had to be provided, the resources of Free-Trade finance were not at an end. The wealth of the country was great, and was growing at a gigantic pace, and the very rich might fairly be asked to make a substantial contribution to improve the lot of the poor. It was their interest that there should not be so much poverty side by side with gigantic wealth.
After a speech from Mr. Chaplin, complaining that the Chancellor had failed to answer the charge of reckless finance, the resolution was passed by 230 to 31.
The rest of the Budget resolutions were discussed on Report and agreed to on the following day, May 26. Unsuccessful efforts were made by Mr. McArthur (Kirkdale, Liverpool), Mr. Bonar Law (Dulwich, Camberwell), Mr. Austin Taylor (Toxteth, Liverpool) and other members, to obtain for the importers of foreign refined sugar a rebate of duty on stocks in hand when the remission of duty was announced. Mr. Lloyd-George stated that the rebate desired would cost the Exchequer 300,0001. On the resolution relating to the Excise duties on Irish-grown tobacco, Mr. Stephen Gwynn (Galway) asked that Irish tobacco-growing might be financially encouraged, and moved an amendment reducing the duty on Irish manufactured tobacco from 3s. 10d. to 2s. 10d. per lb. The Chancellor of the Exchequer resisted the demand as frankly Protectionist, and opening the way for Protection for hops and beet sugar; but eventually he promised it his further consideration in consultation with the Irish Department, and the amendment was withdrawn.
Before this latter debate an episode occurred illustrating the readiness of the House to consider extensive reforms. Mr. Pirie (Aberdeen, N.) asked leave to introduce a Scottish Home Rule Bill under the ten minutes' rule. He explained that it gave effect to a resolution passed by the House in 1894 and supported by several of the existing Ministry, devolving on Scottish legislative bodies the power to legislate on matters exclusively affecting Scotland together with power to impose taxes other than Customs and Excise. The Scottish Privy Council would be revived, its Executive Committee would advise the Government, and arrangements were provided for adjusting the financial relations between Scotland and the Imperial Parliament, whose control was fully maintained. Mr. Balfour, who had objected on a point of order to the enumera