Lord Advocate and Land Taxation

Arthur Balfour, et al.

[An exchange in the House of Lords, 22 July 1909]


The noble Earl the Leader of the House knows that, through no fault of my own, I was precluded from getting an answer to a simple question which I had on the Paper yesterday. The noble Earl sent me a most courteous message asking whether would postpone the question until this hour to-day. In order to do that I was technically obliged to take the question off the Paper altogether, because if it appeared on the Paper I could not bring it on at this moment. I understand from the noble Earl that it is convenient for him to give me an answer now, and therefore, with the indulgence of the House, I would call attention to the speech of the Lord Advocate at Armadale on June 2, when he was reported to have said— The Chancellor of the Exchequer had made but a very modest estimate of their yield, only some£500,000, yet of all his proposals they would find that the land taxes would be the most keenly—indeed, savagely—fought. Why? The reason was that these modest-looking taxes involved a principle capable of far-reaching application, a principle which they believed to be sound and safe, but which the great bulk of their political opponents equally strongly denied. What was that principle?

It was this, that the land of the country, the land as distinct from the buildings erected upon it, the land as distinct from the improvements made upon it, in truth belonged to the nation. And if this were so, then the nation was entitled to appropriate for public purposes a portion of the value of the land. This the Chancellor of the Exchequer proposed to do. It is not my intention to make a speech and I do not wish to comment upon the private opinions of members of the Government, because I know there is a large amount of latitude allowed; but the Lord Advocate announced the opinions of the Government, and I think we are entitled to be informed whether the opinions of His Majesty's Government are correctly represented by the Lord Advocate.


My Lords, I must apologise both to the noble Lord and to the House for not having been in my place yesterday to answer this Question when it was on the Paper, but I was detained elsewhere by very important business connected with the South Africa Bill and it was not possible for me to get down to the House. I am obliged to the noble Lord for having postponed this Question at my request. In answering it now, I shall be enabled, I hope, to clear up some misapprehension which apparently exists.

I understand that the noble Lord is afraid that certain provisions forming part of the Finance Bill are not introduced, strictly speaking, as part of that Bill, but for different reasons. Now, my Lords, the case with regard to this Finance Bill, or any Finance Bill, appears to me to be this—that a Finance Bill is confined to the raising of revenue and to the establishment of such machinery as is necessary for the raising of the revenue either in the particular year, or in future years if any Government should desire to continue to raise revenue in a similar way. That I take to be an indisputable fact; but it does not necessarily preclude either a Minister or other persons from suggesting other considerations which, in their opinion, make the imposition of a particular tax desirable.

Take an instance in which I know I shall have the sympathy of the noble Lord. Supposing that in the Finance Bill it was proposed to impose a 5s. tax upon corn. It 687 would be open, I think, to anybody -- a member of the Government or anybody else -- to say that in his opinion one great advantage of such a tax was not merely the revenue it produced, but the fact that by raising the price of corn all over the country it would encourage the agricultural industry in certain districts and help to retain the people on the land. That is an argument which, at any rate, might be used in districts where wheat is grown, though in large urban centres a different class of argument would probably have to be employed. That appears to me to represent a rough analogy to what has occurred in the present case, in the speech of the Lord Advocate.

When the noble Lord asks me what the opinions of the Government are in regard to the academic proposition that "land as distinct from the buildings erected upon it" and the rest of the quotation belongs to the nation, I may frankly tell your Lordships I have no idea. So far as I am aware that abstract question has never been the subject of discussion by His Majesty's Government. The noble Lord has himself been a member of a Government, and he knows very well that the time which it is possible to set apart for abstract discussions, either economic or metaphysical, is extremely limited, if, indeed, it can be said to exist at all. I am bound to say that this particular question has never been before us, and therefore I am not in a position to reply to that part of the noble Lord's Question.


Then the Lord Advocate was premature in his announcement?


I have no right to speak and can only say a word with the indulgence of the House. The noble Earl, no doubt, observed that in the passage quoted the Lord Advocate referred to a principle which "they" -- that is, His Majesty's Government—believed to be sound and safe, that principle being that the land as distinct from the improvements made upon it in truth belonged to the nation. What we want to know is whether, when the Lord Advocate attributed those opinions to the Government, he was speaking with their concurrence and approval, or only for himself?