The Press.
London, England, 1857-03-14 00:00:00

DISSOLUTION OF PARLIAMENT.

(SUPPLEMENT TO " THE PRESS," SATURDAY, MARCH 21, 1857.)

1853, that at that period the income tax should alto-
gether cease and determine ; but I am bound to
point out and submit to the Government the present
position of the finances, which, I confess, unless
some vigorous and active measures are taken,
leave me little expectation that that pledge can be
fulfilled.

In the present year the Chancellor of the Ex-
chequer calculates on having a surplus of somewhere
about 500,0001. It was a portiol of the arrangements
made in 1853 that in order to provide for the gradual
abolition of the income tax in 1860 that tax should
be reduced, from the sth of April, 1837, from 7d. to
51 in the pound, and so to remain until its final ex-
tinction. But war supervened, and so far from it
being possible to reduce the income tax during the
continuance of the war it was found necessary to
double its amount from 7d. to lid. in the first in-
stance, and subsequently to increase it still further
to 16d. in the pound. The last act was introduced
by the present Chancellor of the Exchequer. The
act which preceded it bore on its face that the in-
come tax levied for the war should continue for one
year after the conclusion of peace and no longer.
The act introduced by the present Government pro-
fessed to bear the same condition on its face and to
be nothing more than the extension of the amount
of the tax from 14d. to 16d. in the pound, but by
that which has been represented to be a mere slip of
the pen—a mere casual error—it did so turn out that
from the words of the act, and from the periods of
the year at which the peace was concluded and rati•
fled, the letter of the law, which professed to keep
the extraordinary taxation for one year after the ter-
mination of the war, practically continued it for two
years. It was admitted on all hands that that was
not the intention of Parliament, and it was loudly
declared by the Government that they would be
ashamed to avail themselves of so paltry a quibble.
Now, if they did not choose to avail themselves of so
paltry a quibble, the simple process would have been
to repeal the act from the time it was intended to
cease, the consequence of which would have been
that on the sth of April next ensuing the income
tax would have been reduced to sd. in the pound ;
and I cannot but express my deep regret, on account
of the principle involved, that under these circum-
stances the Chancellor of the Exchequer should have
taken advantage of that casual error in the Act of
Parliament, not, indeed, for the purpose of keeping
up the whole war tax for the present year, but of
making an addition of 2d. in the pound, and that for
the ordinary purposes of taxation, beyond the amount
to which it was the intention of Parliament the tax
should be reduced. (Hear, hear.) You may say
what you please, but that act on the part of the
Chancellor of the Exchequer was, in fact, to the ex-
tent of :d. in the pound, which means •,000,0001. to

increase the amount of the income tax for ordinary,
and not for extraordinary, revenue.
I regret deeply that which appears to:be in prin-
ciple an invasion of the arrangements laid down in
1833; but with this addition of 2,000,0001. the Chan-
cellor of the Exchequer calculates that in the year
1857-58 he will have a surplus of 500,0001. That
calculation of surplus revenue proceeds on the
assumption that the expense of the war with Persia
will not exceed 250,0001., and also on the further
assumption that there will be no extraordinary de-
mand on the resources of the country in the present
year. Consequently, no provision is made for that
most calamitous—and, I am afraid, most expensive--

war in which we are unhappily involved, by no
choke of our own, with China. (Hear, hear.) But
upon the impossible assumption that the war with
China will coat nothing, and on the improbable.as-
sumption that the war with Persia will cost no more
than 250,0001., the balance of revenue over expendi
ture in the present year will give, according to the
Chancellor of the Exchequer, a surplus of 500,0001.
To make that surplus of 500,0001. you will receive in
the present year a half-year's amount of the 9d. war
income tax, amounting in round numbers to
4,500,0001. That source of revenue will fail you alto-
gether in 1858. Therefore you will have your
revenue in 1858, as compared with 1857, diminished
in the first place by 4,500,0001. of war income tax.
If the law stands without alteration that revenue will
farther be diminished by a fall on the sth of April
next year of income tax from 7d. to 5d., which would
make a further reduction of •2,000,0001., or, making
allowance for a half year of that 2d. to be collected,
it would make ti'e reduction of 1,000,0001. There
fore you would have in the revenue of 1858, as
compared with 1857, a deficiency of 5,500,0001. But,
in addition, there is a provision that in 1858 there
should commence a sinking fund to provide for the
debt raised by the present Chancellor of the Ex-
chequer, which will swell your expenditure uplin
1858 above 1857 to the amount of nearly 1,500,0001.
Therefore, tbere is a prospect that in 1858 there will
be a diminished revenue of 5,500,0001., and an in •
creased expenditure of 1,500,0001., leaving a balance
to deficit of nearly 7,000,0001., against which you
have to set your surplus of the present year of
500,0001. So you stand at present. You find, by
the programme of the Government, that, with no
extraordinary expenses, and with a very inadequate
provision for the war with Persia, and none for
that with China, you have a deficiency in 1959 of
6,500,0001.

I will not go so far forward as Is6o, when you will
recollect that to carry out the plan of 155; the whole
of the remaining income tax is, to be sacrificed,
which will make a further reduction of 3,000001.,

because there will be soma items falling in—such as
1,300,0001. of Long Annuities—and there will be a
cessation of the payments, amounting to 2,000,0001.,
on &mould o 1 the Exchequer Bonds. lava silistied
to sesame that the farthei falling AI of Noway,.
of &icons tax will not lacrosse Übe eaticiency 41C the
former years. But you have a permanent deficiency
from this year to the amount of no less than
6,500,0001. Is not this a circumstance worthy of
serious consideration? (Hear, bear.) I ask your
lordships what hope can be seriously entertained
that the expectation will be realised that in the year
1860, or at any subsequent period, w shall be
relieved from the intolerable pressure of the income
tax ?

There are three, and only three, modes by one or
all of which we may attain to a balance between
revenue and expenditure. In the first place, this
balance may be obtained by the increased produc-
tiveness of the present taxes ; or, secondly, by the
imposition of new taxes ; or, thirdly, by the institu-
tion of a rigid system of economy in the national ex-
penditure. I fear that we may have occasion to
apply to all three.
My lords, I lay great stress upon the elasticity of
the national revenue when it is relieved from the
pressure of the direct taxation that weighs it down.
But it would be folly to suppose that the increased
productiveness of the existing taxes could raise the
revenue to anything approaching 6,500,0001. in the
course of a single year.
With regard to the second mode, I know with what
distaste and disgust the country looks to new taxes
in time of profound peace.
There remains, then, the third mode—a close and
rigid attention to economy, and a strict reduction of
national expenditure. (Hear, hear.) The principal
branches of that national expenditure are, first, th
payment of the national debt, which cannot be
reduced, except by the application of accruing sur-
plus revenue, with due regard to faith towards the
public creditor. Next come the civil establishments,
in which I do not think any material reduction can
be effected; and then come the three great branches
of the army, the navy, and the miscellaneous esti-
mates. My lords, it is in these three branches,
and in these alone, that any considerable redaction
of expenditure can take place. (Hear.) I should be
one of the last to wish to see the military establish-
ments of this country reduced below a state of ef•
ciency. I should be sorry to see them reduced to the
point at which they were kept between the years 1840
and 1850. (Hear.) I think that such a state of our
military establishments is not consistent either with
the honour or the safety of the country. The only
principle which I recommend is that which combines
economy with a due regard to the efficiency of the
public service, and that which I am most anxious to
vindicate and support is the necessity of keeping
your military and naval establishments as strong as
you can in all that relates to military science, in all
which cannot be produced on the spur of the
moment or in the efflux of a moderate space of time,
of placing your army in that state of efficiency in
which it is the duty of the Government and of the
country to place it—organically strong, but numeri-
cally as low as is consistent with the duties it has to
perform in time of peace. (Cheers.) I lay this
down as a principle. but I shall not pretend to enter
into details on this subject.

With regard to the miscellaneous estimates, they
have increased most formidably in the last few
years, and this not from any fault of this or that
Government, but from the pressure and extrava-
gance of Parliament. (Hear.) It has formerly
been the theory that Parliament ought to be the
check upon the tendency of Governments to spend
money ; but with regard to the miscellaneous esti-
mates the duties and positions of these two bodies
have been reversed, and the Government has been
the check, but not a sufficient check, upon the
extravagance of Parliament. (Cheers.) I do not
propose to go further on this topic, and I will there-
fore only urge upon the consideration of your lord-
ships and the country that if it is desirable to get