The Sun.
London, England, 1861-04-23 00:00:00

THE SUN, 'LONDON,'" TUESDAY EVENING, APRIL 23, 1861.

not depend on existing revenue, and o'er which the Chan-
cellor of the ExclSessuer hrsl.no control at all: qCheert.)\
If he might ivieittfie to quote:an authbrity for thig, he might
cite the opinion of -the Chancellor of the Excliequei
himself, in 1860. The right honourable gentleman then
said, "I must have recourse to those taxes to which I
am by law entitled, and if I do so, I find I have a
deficiency of £7,000,000." Now the same argument would
hOld good this year. The 'right hon. gentleman had pre-
cisely the same figures to deal with, the same amount of
tea and sugar duties, and the same income tax. The right
hon. gentleman said in 1860, " I take the very tax as by
law established, and I have a deficiency." This year he
said, "If you reimpose these taxes, you will give me a
surplus." If that deficiency were made up by the re—
imposition of the tea and sugar duties and by an income
tax at Bd., the right hon. gentleman would have a small
surplus of £200• 000 If he (Mr. Stanhope) was right, and
that Bd. income tax was all that was required, they would,
by the resolution now before the house, be asking for an un-
necessary additional Id. upon the income tax of 1861.62.
As one of those representing the taxpayers of the country,
he (Mr. Stanhope) would not vote another penny to the
income tax in order to provide for the removal of any per-
manent tars whatever. (Opposition cheers.) He certainly
was puzzled to discover why they were called upon to take
off the paper duty. The resolution of 1858 was to the effect
that in the opinion of the house to retain the paper duty,
as a permanent source of revenue, would be unjust and im-
politic. To that resolution he (Mr. Stanhope) fully ad-
hered. He should be quite prepared in 1862 to say that the
paper duty ought not to be a permanent tax; but did that
compel him to throw an additional Id. on the income tax, in
order to take off the paper duties ? (Opposition cheers.)
In 1858, when the income tax was only 3d, in the pound,
the house unanimously rejected a resolution that financial
arrangements should then be entered into to take off the
paper duty; and he asked now, was it consistent, or was it
fair towards the taxpayers, at the present time, when an in-
come tax of Bd. was necessary and inevitable, to call upon
the house to accept that very resolution which, under more
favourable circumstances in 1858, they refused ? The income
tax had been spoken of as a non-existent source of revenue
at this moment, the act having expired ; but the tea and
sugar duties were in nearly the same position, for they
would expire in June. For his own part, he would will-
ingly give the Chancellor of the Exchequer the extra
penny of income tax if the right hon. gentleman would
modify his budget so as to dispense with the tea duty. The
additional duties on tea and sugar were among those burdens
which the people of this country cheerfully consented to
bear for the expenses of the Russian war, and it would be
making them a bad return for that willing sacrifice in time
of war if these burdens were not to be removed now that the
war was done. Let the tea duty be at once reduced, and
then he was sure that, if a time of war or danger should
again arrive, the English nation would readily permit their
Parliament to re-impose 2d. or 4d. or 6d. on the same arti•
de, as it. might be required. The same remark would ap-
ply to the income tax; for if any disaster should occur, or
if it should be requisite, on account of a bad harvest, or the
state of foreign affairs, or the state of trade, the Chancellor
of the Exchequer would only have to come down and ask
for an increase of the income tax to meet that emergency,
and he knew it would then be granted. It was upon such
extraordinary occasions that he ought to avail himself of an
augmentation of revenue from those particular sources. But
in the piesent state of things the tea and sugar duties were
sufficient to cover the actual deficiency, with an Bd. income
tax, and the other penny of income tax was not therefore
required. The Chancellor of the Exchequer, however, al-
lowed the House of Commons to grant him a ninepenny- in-
come tax, and then he pretended to console the income tax
payers, by telling them that he would give away that extra
penny to somebody else. It was like the story of two gen-
tlemen who went to the opening of a church, where, after
the sermon, there was a collection, and one of them, who
happened to owe the other a pound, said to his friend, "My
good fellow, I've owed you a pound fer some time, and now
I'll tell you what I'll do, I'll put it into the plate for you."
(A laugh.) The remarks which he had now made were
not dictated by any hostility to the occupants of the Tree-
sum y bench, for he did not think a change of Government
was desirable. But he could not permit a system of finance
to go on which, he believed, must put the country some
time or other in one of two most dangerous alternatives—
either that they would be trusting entirely to the income
tax as the mainspring of their finance, which would have
a fatal effect both on the industry and real property
of the country; or else, which he looked upon
with yet greater dismay, that some day, goaded by the
severe pressure of direct taxation, they would be driven
hastily and inconsiderately to wholesale retrenchments of
expenditure. The people would perhaps make what the
right hon. member for Oxfordshire once called " an ugly
rush" against the estimates; and yielding to that impulse
they might, by four or five years' false economy, undo all
the prudent preparations of the last few years, and the re-
sult might be to compel some other Minister, perhaps in the
middle of a war, to make violent efforts for repairing the
public service. By such a course we should weaken those
material guarantees for the peace and honour of England
which it was indispensable for us to maintain, in the shape of
an efficient army and a great naval force. He hoped such a
course would not be pursued by the house. (Cheers.)
Mr. DODSON agreed that the budget of the Chancellor
of the Exchequer was characterised by much audacity, but
equally, as he thought, with foresight. Starting with a defi-
ciency he had shown that, if he assumed the expiring taxes
to be oontinued, he should arrive at a surplus of .£1,900,000,
which he had no sooner told the house than he proceeded to
annihilate it by reducing taxes to the amount of £2,500,000
a-year, but as the reduction of the income tax was only to
be for three querters of the financial year, and the paper
duty for the last half-year, the full effect of the reduction
was thrown on the year 1862-3, so that the right hon. gen-
tleman, by his estimates, would have a surplus for this year
of £400,000. Hon. gentlemen opposite cavilled at the re-
duction of the paper duty, but did not distinctly propose
anything of their own. They insinuated that they would
like to strike off another penny of the income tax, or the war
duties on tea and sugar ; but as that would be equivalent
to taking off the paper duty, they would make as large a
gap in our finances as they accused the right hon. gentle-
man of doing. He (Mr. Dodson) saw rio reason to distrust
the right hon. gentleman's calculations for the next year.
There was, indeed, the chance of a bad harvest again this
year. The £750,000 of indemnity from China might be
relied upon as safely as any other source of revenue. The
right hon. gentleman's calculations for last year had proved
remarkably correct, except so far as concerned three large
items of Excise, which altogether fell nearly two millions
below the estimates, but from accidental causes, the un-
favourable season and the bad harvest, which could not be
helped. Those items were the malt duties, which fell
short by £BOO,OOO ; the spirit duties, which fell short by
£900,000; as that was a superfluous article of luxury, its
consumption was checked at such a time ; and lastly, the
hop duties, estimated at £300,000, had entirely disappeared.
It was satisfactory that the consumption of other articles,
such as tea, coffee, cocoa, raisins and currants, and tobacco,
all belonging to the comforts of the people, had increased
during the year, and the decline in sugar was but very
small. The hop duty, as he had said, had entirely failed,
and this showed the folly of levying a tax on an article so
exceptionally uncertain and unreliable as hops. The crop
of wheat or barley might vary from one season to another,
but only within certain limits which could be reckoned upon.
It was very different with hops. He saw no reason tesques-
tion the calculations of the right hon. gentleman with re-
gard to his estimate of income. As far as he was aware no
one on either side of the house found fault with the remis-
sion of the penny income tax. There was a greater variety
of opinion with respect to the proposed remission of the
paper duty; and however desirable that remission might
be in itself, it was a question whether other interests had
not a greater claim for consideration. He should reserve to
himself full liberty tp discuss that question when it came
specifically before the committee.
Mr. BLACKBURN said there were two questions for
the consideration of the house ; first, was the estimated
surplus likely to be realised ; and, secondly, whether the"
proposed modes of disposing of it were the most proper.
No doubt the Chancellor of the Exchequer was in the
best position for forming a correct opinion on the first
point, but when the right hon. gentleman was found to be
in error to the extent of £2,000,000 in one year's anticipa •
tions it was not altogether safe to trust to his estimates.
The right hon. gentleman calculated upon an increase of
£1,000,000 in the ordinary revenue of the year, but if he
did not get that increase what became of his surplus of
£1,900,000? He thought it would have been much safer and
wiser to have the money in hand before proceeding to
repeal taxation. With regard to the disposal of the surplus,
he entirely agreed with svhat had been said by the hon.
member for Lincolnshire. The proposed repeal of the penny
income tax was in reality an addition made to that tax, for
the purpose of repealing the paper duties. He considered
that the remission of the tea and sugar duties would have
been much more acceptable to the people. (Hear, hear.)
Mr. POLLARD URQUHART believed that the propo-
sition of the Government would be most beneficial to Ire-
land, which possessed a large undeveloped water power by
means of which the manufacture of paper could be carried
on to an immense extent. (Hear, hear.) It was said that
the proposal of the right hon. gentleman was ill-timed, but
if there was a deficiency of tlan harvest, the very best mode
of counteracting such a calamity was to afford the means of
employment to the people. Sir R. Peel acted oa that prin-
ciple in 1842, and with the most decided success, for it ap-
peared by the last census returns that whereas the entire
population had increased only 12 per cent., those classes
whose industry had been freed from the pressure of excise
duties had increased from 40 to 80 per cent. He believed
the same result :would follow the remission of the paper
duties. He hoped to see a considerable reduction in the
expenditure, because enormous taxation would do what the
Milan decrees had failed to effect—check the consumption
of their products. (Cheers.)

Mr. BAILLIE said the Chancellor of the Exchequer pro-
posed last year an unusual method of finance—that of pro-
posing a large remission of tixation in the face of a deficient
revenue. The right hon. gentleman took a different course
now, for he said he had a surplus of £1,900,000, and be pro-
posed to divide his favours between those who were anxious
to see a repeal of the paper duties, and those who were desir-
ous to have a redti3tiOn of the income-tax: At first sight that
appeared a fair proposition, and if there walla large surplus
to dispose of, it might be made not is'itluut

Unfortunately, however, that was not the case. The surplus
rreVenne Wei Pfaeticallk a dellsion. Tie eight ho& gentle-
men seemed to have adopted that system of finance which
was common imongst certain classes of traders—that of rais-
ing money by bills in order to pay debts, and renewing those
bills when they became due. With such a mode of finance
no Chancellor of the Exchequer need ever fear a deficit, or
be in want of a surplus. Ile had a great objection to the
repeal of the paper duties under existing circumstances.
There were only two ways in which the repeal of the paper
duties could be advantageous, the price of newspapers, and
the price of books. IV ere not the penny papers at present
in a prosperous state, and were driving the old papers out of
the field ? Why, it was only the other day that the great
organ, as it had once been, of the Whig party, the Morning
Chronicle, had been reduced to a penny paper. Then as
regarded the price of books, that would not be affected in
the least,or in the most inappreciable degree. Then,as to the
paper trade, it was at present in a most flourishing condition.
It might be said would no one rain by this repeal of the paper
duties ? Yes, there was one, a small but a powerful class,the
proprietors of the penny newspapers, who were represented
in that house and in the Cabinet, and had succeeded in
forcing this measure upon the Government. It was only a
short time ago that in reply to a deputation who waited on
the First Minister of the Crown to ask for the repeal of
those duties, they were told that in the present critical state
of Europe the repeal of those duties was not advisable.
What could account, then, for the change which had taken
place in the sentiments of the Government ? The aspect of
Europe was net much changed in the interval, and yet
they had the Chancellor of the Exchequer coming down to
that.house proposing the repeal of the paper duties, and at
the same time denouncing the extravagant increase in the
public expenditure. The right hon. gentleman had come
down to the house last session, and in a most vituperative
speech denounced the conduct which had been pursued in
another place as the most gigantic innovation of modern
times. He (Mr. Baillie) believed that the course which the
right hon. gentleman was now pursuing was actuated by a
desire to obtain popularity ; and that was a course not cal-
culated to raise in the country either the character, the
sincerity, or the political reputation of public men.
Mr. W. E WART believed that tea and sugar had very
strong claims to a reduction of duty, but so had paper.
Every duty taken off articles of consumption had the effect
of increasing the quantity consumed. It was so with soap,
glass, and other articles ; and while he admitted that pub
lications like " Macaulay's History" would not be got
cheaper, it would have a very different effect on cheap lite-
rature. He was for a judicious mixture of direct and indi-
rect taxation, and was fully of opinion that the present ex-
penditure could be materially reduced.
Mr. LONGFIELD said that, notwithstanding the puffs
direct and the puffs indirect which had been lavished on
this budget, he felt the utmost abhorrence of the whole
budget. He believed this budget had been produced for
the purpose of gratifying the vanity of the Chancellor of
the Exchequer, in consequence of the collision between
the two Houses of Parliament last session, and to gratify the
selfish wishes of a few proprietors of penny newspapers.
It was said the paper duty was to be repealed for the benefit
of Ireland. Well, he view something of paper mills in that
country, and, with all! the fostering and cherishing care of
the Government, they would not thrive there. It would be
idle to suppose that by means of the paper manufacture
Ireland would be regenerated. The beUefit resulting from
the repeal of the duty would be of an infinitesimal amount,
and no boon whatever to the people. He knew there were
many cants in and out of the house. There was the cant of
liberalism, and the cant of reform, but the greatest of all
cants was that about taxes upon knowledge. They all
knew that the paper ditty was so small upon books that it
prevented no man frees being just and generous if he desired
to be so. The hon. and learned member then read a long
extract from M'Culloch's "Principles of Taxation," show-
ing that although theipaper duty operated somewhat un-
fairly, yet that it was tie last tax that ought to be repealed,
and that instead of tbatbeing done there would be no great
objection to its being raised to 2d. a pounl, seeing that it
was a tax raised with so little inconvenience to the people.
There was no ground whatever for repealing it. It was not
enough for the right hon. gentleman the Chancellor of the
Exchequer to say that he expected a surplus at the end of
next year, but to show the house that he could afford to
take off this tax. He admitted that the right hon. gentle-
man had, by the brilliant oratory for which he was so much
distinguished, made it appear that he would have a surplus
next year, but they must all remember what were his
ideas about the duties on Irish spirits and the Chinese war
—(hear, hear)—and his estimate of the probable amount
upon the production of dock warrants, and contract notes
and notes of delivery; and in truth not one of the right
hon. gentleman's anticipations had proved sound. He
would not say the right hon. gentleman knew this would
he so, for it was proverbial that sanguine temperaments
were short-sighted, and all his beautiful promises had
turned out scanty performances. Whether he regarded the
budget as brought about from temper, or more truly in
reference to the course taken by the other house, he could
not give his assent to it. There was no possible mode of
dealing with this imaginary surplus, but if there were then
the right hon. gentleman ought to give the people of Ireland
cheaper malt, sugar, and tea, or take another penny off
the income tax. He thought the budget was objectionable
in its tone and in its details, and he never heard a statement,
when laid befere the house, and separated from the imagery
of the right hon. gentleman, which was more deceptive and
unstatesmanlike. (Hear, hear.)
Mr. NORRIS wished to correct a statement made by the
the hon. gentleman the member for Inverness-shire, viz.,
that the manufacturers of paper were not themselves anxi-
ous for the remission of the duty on that article. The con-
trary was the fact. The trade never for one moment lost
sight of the benefit the public would derive, and the advan-
tage the trade would gain by the repeal of that tax. At a
deput ition of paper manufacturers, amounting to 60 or 70
members, who paid nearly one-half the entire amount of
duty, there was the greatest unanimity, not only for an
equitable arrangement suite the export duty on rags, but in
favour of a repeal both of the excise and customs duties on
paper itself. Amongst all classes of people throughout the
country there was the greatest feeling of satisfaction and
delight at the budget of the right hon. gentleman, and a
determination to give it every possible support.
Mr. LONG said
.L-hpetreohltaoendstaeid
ng, listened with great attention to
the able, lucid, and straightforward speech of the hon. gen-
tleman, the member for Huntingdon; and, as a very young
menSber, he could not but express his surprise that in the
present state of feeling in Ragland with regard to taxation,
the hon. gentle
havemn
as he did, to the mercantile
regret at what appeared
s
against a remission of taxa-
tionwhich produced the revenues of
body—shoulda
t o on one
the
him t
country.
o
of h
be h
the
fet
re a
het
felt
rashness of the Chancellor of the r, (Ii
considerable
he felt, on the other hand, great gratification that
there was sufficient independence and sufficient earnestness
of conviction on the part of the hon. member for Hunt-
ingdon to induce him to stand up and oppose the repeal
of such a duty. He also felt considerable surprise that
the speech of the hoe. gentleman was not followed up by
a more active conclusion, and that he had not moved an
amendment which would have expressed the opinions held
largely on ono side of that house and largely out of doors.
If he might be permitted to hazard a guess why that
speech was not followed up by an amendment, he should
day he feared hon. members opposite would act with regard
to the paper duty as they did last year with regard to the
Reform Bill. But what would be the result of the budget
now proposed for the adoption of the house ? Was it of a
nature that they could give it their support ? He believed
it to be of a nature the very reverse. Was it not a natural
conclusion that the repeal of this indirect tax would make
the case f"r the repeal of other indirect taxes still stronger.
No argument could be given for the repeal of the paper
apply with tenfold force to the case
—or to the repeal of the duty on
hopsr—ewi(hnhisecuahrra)wn—ocaue—lddu(nhtyoetawra)hich was most unfair and arbitrary.
In his opinion the Government were taking a rash and un-
wise course in repealing the paper duty this year. The
Chancellor of the Exchequer in his eloquent speech, whieh
charmed both sides of the house, apologised for leading them
through a wilderness of figures. Ho had no intention of
following the example of the right hon. gentleman ; but the
right hon. member went on to say he had been paying his
addresties to two fair ladies whom he represented as newly
introduces into the world, well dowered and with great
charms. He thought, however, the Chancellor of the Ex-
chequer had not given the whole of that transaction. The
right hon. gentleman whispered his confideneeto the house,
but he stopped at a point which he (Mr. Long) would ven-
ture to pass. The Chancellor of the Exchequer went into
the wilderness with two millions' and a half, but he came
out a poor man, one fair lady having wheedled one million,
cash down, out of his pocket, and the other a promise to
pay, to be redeemed after October next, to the tune of
£1,300,000. (A laugh.) He thought tho result of the
Ludget was that they were making it more difficult to meet
the just claims of the country and to maintain its proper
commercial standing in the world. If any hon. member
would move an amendment in condemnation of the principles
and of the details of the budget, he should record his vete
wi th.sat isfaction and pleasure in favour of that amendment.

Mr. BLACK said it vas not his intention to have spoken
en this question, but the hon. gentleman who had just sat,
down had thrown out A challenge, to the effect that hon.
members onthe ministerial 'side of the house were dis-
posed to conceal their opinions on matters of reform, and
with regard to the paper duty. They must not forget
that it_ was not alone on books and writing-paper
the duty pressed heaUy. The coarse wrapping paper that
was sold at 345. the cwt. paid 14s. duty ; and this had to
be levied on the small tradesmen and consumers. It also
pressed enormously on books, in which the chief elements
of cost were printing and paper. The fact was, that if the
tax produced £1,200,000 to the revenue, it cost two millions
to the country. .

Mr. WARNER. believed that the budget had been re-
ceived with satisfaction by the largo constituency which he
had the honour to represent; and that if the Chancellor of
the Exchequer fond himself with a surplus he could not
do better than repkal the paper duty. With respect to the
income .tax, he regretted that the right hon. gentleman had
merely reduced the autiountwithout changing the incidence
of the tax. He hoped_ thnt. :next year they might have a
revision of the tag,*and that it would be collected on the
only sound priviple--Dainely, on income derived from
property.
Mr, )3 ENT INQR, haying complimented the Chancellor

of the gachequereon the eloquence, of his budget speech,
saicilefe was anCither feature of it Which he admired quite
as much, namely, its sophistry. The right hon. gentleman
had drawn a remarkable picture. He had told them that he
found himself called on by inclination and dirty to pay at-
tention to two fAir sisters, :the daughters of necessity and
invention. But this was not the worst. Ha' century
since he (Mr. Bentinck) had been taught that neeessity was
the mother of invention. (Laughter.) He would not large
so painful a subject further, but would proceed from the
social to the financial morality of the right hon. gentleman.
He was at a loss
,to understand how a one-sided treaty
could be beneficial to this country. The right hon. gen-
tleman talked of the country having elected to be governed
at an expense of £75,000,000. As if the -country were
guilty of extravagance as a matter of choice. No man in
that house lamented more sincerely than he (Mr. Bentinck)
did the amount of their expenditure; but he should like to
ask the right hon. gentleman, had it ever occurred to him
to consider what had been the principal causes of their
present expenditure ? Had the right hon. gentleman ever
dotted up the cost of the Russian war ? Had it ever oc-
curred to him to consider what were the causes of that
war ? He did not wish to use stronger language than
the circumstances of the case deserved, but he
contended that few men would rise either in the house or
out of it and deny that one principal cause of the Russian
war was the helplessness of the Government of which the
right hon. gentleman was a prominent member. (Hear,
hear.) Could the right hon. gentleman recall a single circum-
stance betokening foresight or energy on the part of that
Government ? The right hon. gentleman was party to an
arrangement to send 10,000 men to Malta in order to intimi-
date the Emperor Nicholas, at the same time allowing him
to understand that measures were about to be taken for
withdrawing these self-same troops. This was the notable
arrangement which was to deter Russia from going to war.
(Hear, hear.) But what had the right hon. gentleman him-
self said ? He had declared on one occasion, " You ought
not to repeal the paper duties if by so doing you ensure the
perpetuity of an odious tax." Could any argument be more
apposite than that to the present occasion, when the result
of repealing the paper duties would be the perpetuity not
merely of one odious tax but of two ? (Hear.) Then there
were the gentlemen below the gangway who called them-
selves the "friends of the people," They professed to defend
the rights, the liberties, and even the pockets of the people.
Where were those friends now? How would the masses of
the people of this conntry be benefited by the repeal of the
paper duty ? (Cheers.) The penny newspapers would
not come down to a halfpenny ; the whole thing
therefore was s a humbug (cheers) they would
not be putting a fraction into the pockets of the
people. Then where was the benefit- to be ?—and if there
was to be no benefit from the repeal of the paper duties,
would they be told that no benefit was to be derived from
the repeal of the duties on tea and sugar? Would not that
be a great boon to the labouring population and to the work-
ing classes ? (Hear, hear.) What, then, were the friends
of the people about ? Who would reap any advantage except
the man-who had an interest in a penny newspaper ? The
present tea and sugar duties were a war tax—(hear, hear)—
but the friends of the people mado no effort to have them
lightened. That was a kind of friendship he hoped he should
never receive from any man. But there were other classes
of the communir y who deserved to be considered. Why, in
all these financial questions, did the right hon. gentleman
deal with the rural districts of this country precisely as the
hon member for Birmingham did in the question of reform,
that is to say, ignore their existence? There were the hop
duties, and the duties on malt. (Hear, hear.) Why did it
never occur to the right hon. gentleman that the rural dis-
tricts had any existence ? He hoped before this debatewas
over they should hear so many voices raised as to convince
the right hon. gentleman that there were such interests as
rural interests, and such persons as county members in the
house. (Hear, hear.) Ho took that opportunity of warning
every hon. member in the house that by supporting the pre-
sent financial proposal of the right hon. gentleman he would
be doing a 1 he could to injure the interests and sacrifice the
pockets of those he represented. Every member for a rural
district was bound to give his most strenuous opposition to
the proposal of the right hon. gentleman. (Hear, hear.) If
then no benefit was to be derived from this scheme by the
large masses either in the towns or in the country, what
was its object ? It was impossible to say .what the real ob-
ject was; but two possible objects suggested themselves to
the mind. One would seem to be an attempt to reclaim the
wavering allegiance of a certain portion of those hon. mem-
bers who sat below the gangway—(cheers)—who no doubt
up to a very recent period used to make very eloquent and
able speeches—speeches; however, anything but flattering
to the occupants of the Treasury bench. (Hear, hear.) No
doubt there was some secret spring at work—whether it lay
in the repeal of the mystical paper duty or not he did not
know—which • induced those hon. members now to give
theirltrong support to her Majesty's Government. He
regarded this also as an attempt to defy, he would not say
to insult, another branch of the legislature, (Hear, hear.)
That was a branch of the subject which he hoped would be
fully discussed ; for such he believed to be the object and
intention of the right hon. gentleman in departing from the
Course of last year, and embodying his measures in one bill,
by which the Lords would be debarred from dealing with
them in any way. The right hon. gentleman should be
called upon to explain and offer some justification for that
course. It might be said there were some precedents for it,
but they were so few as to be merely the exceptions to a
general rule. He (Mr. Bentinck) must use rather strong
language to characterise this budget as it deserved. It
was an act of bad faith on the part of the right hon. gen-
tleman, after his financial opinions expressed in former
times, because he had been for many years pledged over
and over again in the most solemn manner to make the
repeal of the income tax his great object. This budget was
founded, besides, on a total misconception of his position.
The surplus on which ho reckoned was to be derived
from half a million of Exchequer Bonds, which was
borroWed money, and £750,000 from China, of which
we should probably never get cne shilling, for that
country was in a state of revolution, and the Emperor's
throne was not worth a fortnight's purchase. But even if
the surplus for this year existed as he said, where should
we be next year, when the Chancellor of the Exchequer,
after repealing the paper duty, and keeping up the war
duties on tea and sugar, would have nothing to fall back
upon but, a large increase of the income tax 1 After quoting
the'speech made by the right hon. gentleman in 1852 on the
financial proposals of the right hon. member for Bucking-
hamshire, the hon. member said that he who made such
eloquent speeches, and then brought forward snchfinancial
schemes as these, might be described in the old well-known
verses as the man
" Who never said a foolish thing,
And never did a wise one."
Sir J. PAXTON observed that the hon. gentleman op-
posite was mistaken when he said that the only persons to
be benefited by a repeal of the paper duty would be the pro-
prietors of penny newspapers. He could not know much
of the manufacturing interests of this country if he believed
that paper was only used for purposes of liter;ture. (A
laugh.) He (Sir J. Paxton) must say that the repeal of the
paper duty would be a great boon to his own constituents.
There was not a yard of ribbon made in Coventry that did
not consume a yard of paper. It was important to other
manufacturing towns, such as Nottingham, where a great
quantity of paper was used in packing up parcels. The
paper manufacturers were, he believed, as a whole, opposed
to the repeal of the paper. duties, as the manufacturers of
glass had been opposed to the repeal of the glass' duty. A
great deal had been made of the difficulty of obtaining rags,
but a friend of his told him that he imported a large amount
of rags from India by which he made 30 per cent. He
claimed the support of the right hon. gentleman (Mr. Dis-
raeli) in favour of the repeal of the pap( r duties, because he
said in 18:50 that he looked on the tax on paper as one
which, when a favourable opportunity arose—(hear, hear,
from the Opposition)—it was desirable to repeal on com-
mercial, literary, moral, and educational grounds, and he
should be glad if it was in his power to repeal the tax. It
wos now in the power of the right hon. gentleman to settle
this vexed question. The hon. member for Huntingdon
adopted a very doleful tone in speaking of th. flnannial.
prospects of the country; but if that was the real opinion
of the hon. gentleman, he was surprised that he should
be one of the persons to sanction the large expendi-
ture to which the Exhibition of 1862 must give rise—an
expenditure which directly and indirectly could fall little
short of £1,000,000 or £1,500,000. (Hear, hear.)
Sir S. NORTHCOTE said that the budget of his right
hon. friend might be viewed from many sides. It had a
political and a financial side, and with the last alone he
should venture to deal. It was with great diffidence that
he rose to impugn the calculations of so high en authority
as a cabinet minister; but he was somewhat encouraged to
do so by the fact that the calculations of his right hon. friend
last yen. had not been realised. His right hon. friend the
member for Huntingdon (General Peel) called in question
during the last session the sufficiency of the army estimates,
but the noble lord thee,Secretary for War (Lord. Herbert)
expressed his conviction that the estimates of the govern-
ment would be sufficient. But it turned out that his right
hon. friend was right to the extent of £450,000, and the
Secretary of State was wrong. (Hear, hear.) No less than
£250,000, which had been allotted to the navy, was trans-
ferred to the army ; and they heard, on Monday last, that
another sum of £200,000 was to be taken for the army
excess of the year. (Hear, hear.) Again, his right hon.
friend the Chancellor of the Exchequer, in his supple-
mentary budget of last July, t )1d them that he was going
to take out a certain sum from the balances of the Ex-
chequer—he believed £1,286,000; he told them that the
balances were in a satisfactory state—that theyamounted to
a certain sum in March—that they had fallen in June—that
they amounted to £6,500,000 ; but that it was expected they
would be in a more satisfactory state in September than
they were in June. It turned out however that they were
much less satisfactory, for they were lower in September
than they were in June. He thought these facts justified
him challenging the calculatiohs now before them. He was
astonished t,e) hear it said that the predictions or rather the
calculations made on his side of the house had proved to be
groundless, the fact being that the calculations were lite-
rally justified by the result. They stated last year that the
provision made for the year was not sufficient. It was not
sufficient. (Hear.) His right hon. friend said he had a sur-
plus of £1,900,000, but in truth if the house declined to vote
the taxes which his right hon. friend asked them to vote
there Would be a deficiency; of X 8,500,000, [The CILANCEIe,

Lon of the EXCHEQUER—£2O,OOO,OOO.) If they declined to
renew the tea and sugar duties the deficiency would be 20
millions; but he referred only to those extra taxes which
his right hon. friend said should be open for the considera-
tion of the house thii year. They had therefore a large de-
ficit to deal with. He might be told that they had predicted
last year that it •vc ould be very much larger. Well, that was
true—(hear)--they did predict that it would be larger, and
they were quite justified in doing so ; for at that time the
spirit duties stood at Bs. instead of at 10s. per gallon, t which
they were ultimately raised, and the paper duties were not
repealed as they were at first to have been. The raising of
the spirit duties made a difference of £1,500,000, and the
paper duties were another £43)0,000, making together a
sum of £2,800,000, which would have raised the deficit. to
£11,000,900 or £l2 000,000, which was what they (the Op-
position) said they would have to deal with this year.
(Cheers.) He congratulated the right hon. gentleman in
some respects upon his policy. No doubt there were por-
tions of it which had proved very satisfactory; but at the
same time they must look at it as a whole, and not let their
gaze rest upon a single bright figure, when there was so
much of gloom in the picture. (Hear, hew.) Last year
the deficit had been about £2,500,000. The right hon.
gentleman said that there was a sum of £300,000 which
really belonged to the previous year; but that on reflection
was a mode of calculation on which he would hardly
care to insist, because if he took credit for that
£300,000 he must be prepared to give credit for the
£750,000 which was outstanding on the vote of credit for
the China expedition. (Hear, hear.) The deficit last year,
then, was £2,568,000; and how had that been met ? The
right hon. gentleman said he had taken £1,450,000 out of
the balances in the Exchequer, and had added £460,000 to
the unfunded debt of the country. But the first observa-
tion that 'suggested itself on that statement was that
£1,450,000 and £460,000 did not make £2,568,000. (Cheers.)
The CHANCELLOR of the EXCHEQUER—I never
professed .to state how the deficit was met. (Hear, hear.)
Sir S. NORTHCOTE—Then the right hon. gentleman
ought to have done so. (Cheers.) But the only figures he
had given the house were the two sums which he (Sir S.
Northcote) had quoted, and like many other hon. gentlemen
he had ever since been puzzled to make out the difference.
He would state to the house how he supposed the matter
stood. In the first place, it was absolutely necessary to
take into consideration an item which the right hon. gentle-
man designedly and deliberately told the house he should
omit—the vote for the fortifications. This year the loan on
that account had amounted to very little. Only £200,000
had been borrowed, of which only £50,000 had been ex-
pended ; but though the item was now a small one, it would
probably be larger in subsequent years, and he must protest
against its omission from the account. Besides the two
sums he had mentioned—the £454,000 addition to the un-
funded debt and £1,300,000, the diminution of the balances
in the Exchequer reckoning the fortification vote—he found a
third item, repayment of advances, £627,000. Now, he
wanted to know what these were, for he believed that a
good deal would turn upon them. He supposed that they
were repayments of the loans advanced for public works.
If that were so, this was another addition to the debt of the
country, for though the money had been borrowed many
years ago, it had originally been raised by loan, and what
was now paid in ought to have been lent out again. If,
however, it was now used for the services of the year, it
was virtually a new loan ; and he did not think it ought
to have been so used without the sanction of Parliament,
or without explanation to the house. (Chee:s.) It might
be that he (Sir S. Northcote) was in error in the ca:kclusion
at which he had arrived; but if so, he could only rep,?at
that the right hon. gentleman ought to have :informed the
house how the deficit of last year had been made up, and
then he (the hon. baronet) should have been in no danger
of drawing a false dedUction. At present it appeared to
him that they had made an addition to the debt in the year
of no less than £1,257,000, besides largely drawing upon the
balances in the Exchequer; besides which he ought to add
another million for Exchequer-bills not paid off; and then
the addition to the debt in the course of last year would
stand at two millions and a quarter. (Hear.) There was,
moreover, an army excess of £2oo,ooo—how was that to be
paid ? Was it also to be taken out of the Exchequer
balances, or was it to be thrown upon the revenue of the
coming year ? in which, by the bye, there was no provision
for it. He could imagine hon. gentlemen exclaiming,
" What in the world are these balances ?" No doubt they
were partly made up of accumulations of surrendered ser-
vices ; but to a very large extent they consiste3 of sums
already appropriated. It might be a very pleasant thing to
have a large balance at one's banker's, but if against that
balance there were large claims and cheques outstanding,
it would be less gratifying. It certainly seemed to him that
if ever there was a time when it was desirable to have the
Exchequer balances strong-it was now ; whereas the right
hon. gentleman admitted that they were £700,000 less than
they were this time last year. (Hear.) They were told that
there was a surplus of £1,900,000 ; and he (Sir S. North-
cote) supposed that had been very fairly calculated. Of
course there was always some risk of such failures as those
which they had last year, and which had undoubtedly re-
sulted from the unfortunate harvest, on which they could
not calculate; though it might, to be slue, have been cal-
culated upon at the time the right hon. gentleman produced
his supplementary budget. The only point on which he
felt doubt was the £750,000 of China money. He really
could not understand the explanation which had been given
by the noble lord (Lord J. Russell) on that score. At one
time the noble lord seemed to think there would be
£600,000 ; while at another he spoke of only vocyro ; and
there appeared to be some, uncertainty in his mind as to
whether the merchants were to receive their compensation
in the first year. It was most important that with so small
a surplus the house should receive more explicit informa-
tion, for at present the explanations which had been given
were anything but satisfactory. (Hear, hear.) Last year
they were asked for £3,80.',000 for the extraordinary ex-
penses of the army and navy. They granted that sum, and
the Chancellor of the Exchequer told them he had no occa-
sion to pay more than a little over £3,000,000, and conse-
quently there was a balance of £750,000 still unspent. lie
asked the right hon. gentleman if that sum was now avail-
able if called for, but the right hon. gentleman was obliged
to tell him that it was not in his power to say, but that it
still remained good for the service of the year; therefore
that £750,000 was as good as gone. It was possible that
this £1,000,000 which they were about to take for the ser •
vice of the year might not be required for this year, but
there was the money in the Exchequer, liable to be drawn
Out He did' feel that In all the provisions of the finan •
dal arrangements this was the one which required the
most careful scrutiny, and was the least satisfactory.
(Hear, hear.) He thought, therefore, the house Ought
to have more full explanations of our financial position
than they had yet had. (Hear,
,hear.) With regard to
a provisional budget, he thought if there was any pro-
position upon which financiers were fully agreed it was
that it was very undesirable to live upon a system of pro-
visional finance. It must, for instance; be very disadvan-
tageous to those who were dealing in tea -and sugar not to
know from year to year what the taxes on those articles
were to be. (Hear.) The Chancellor of the Exchequer
told them that with regard to two articles, tea and sugar,
the duties had been stationary during the last two" years ;
but did not the right hon. gentleman know the stationary
character yf those imports ? The merchants looked for the
estimates of the Chancellor of the Exchequer, and about
the middle of July next they would look for a considerable
reduction in the tea duty ;' but when they had imported
their teas they would find the reduction had not been made,
and they would be obliged to keep them in bond. (Hear.)
It was true there might be conditions in our trade under
which we might be content to vote some of our taxes for
one year. Last year our exports were £136,000,030; for
the first two months of the present year they were only
£3,570,000, being a reduction of 164 per cent., which was
lower than any year since 1857. They were told that our
import trade was going bn satisfactorily, but they did not
import many of those articles because the taxes had been
taken off, but because there was a deficient harvest in this
country, and they were obliged to buy food in other coun-
tries. He connected that with the very remarkable decline
011 r traria will, 4ho TTniforl Rfo+oo, for ho found that
those first two months there was a total decline on
various articles amounting to 37 per cent. (Hear, hear.)
He thought that was another proof that there might be a
necessity for a provisional budget, and to vote the taxes foe
a short time only. But if that was so, should they at the
same time withdraw a large sum from the permanent sources
of the taxation of the country ? (Hear, hear.) They had,
moreover, to see what would be the working of the treaty
with France. He believed that working would be satisfac-
tory. (Hear.) They had also got to see what would be the
working in the alteration of the spirit duties. On the sugar
and tea duties they might, if necessity required, re-impose
a duty of a penny a pound, but if they repealed the paper
duty it Was lost altogether. He therefore entreated the
house to 'muse before they committed themselves
irrevocably to the repeal of this tax. He was satisfied with
the proposal as to the income tax. He believed that Bd. in
the pound would be sufficient to balance the account, but as
they did not know what might happen it was as well that
the rate should be 9d. The Chancellor of the Exchequer
might reply that he hoped to reduce the expenditure, but
that was a hope they might indulge in tco long. The
right hon. gentleman had been in office near two years, but
be had not done much in the way of reduction. He did
not blame him. The feeling of the house, the feeling of the
country, and he dared say the feeling of his colleagues, had
been too strong for him. He hoped that the house would
not part with the substance for the shadow

Mr. S. FITZGERALD moved the adjournment of the
debate. ,

Lord PALMERSTON—At this hour of the night, when
so many members probably wish to speak, we shall not
object to an adjournment. I hope, !'rowever, that the ani-
nouncement of an hon. gentleman opposite that the debate
will last for a great many nights before you, Sir, leave the
chair, will not be fulfilled. i trust that on Thursday, when
we shall resume the debate, you will bo allowed to leave the
chair. There will be many opportunities in tho course of
the committee for members to deliver their opinions. '
Mr. IMSRAELI—The noble lord says very justly that
there will be many opportunities in committee on th•
different resolutions for members to express their opinions ;
but we must remember that this is the only occasion on
which, according to the strict rules of the house, we can
have a discussion on the whole project of the Oovernment.
(Hear, hear.) It is not from any wish to delay the progress