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and a revolution, the first modern proposal of Government machinery for settling and enforcing the rate of wages. He called attention to the action taken by Continental Governments, and thought some agreement with them might be reached. Mr. Lyttelton supported the Bill in a sympathetic speech, but with some reservations, chiefly as to the powers to be given to the Board of Trade: Mr. Marks renewed his effort to raise the Tariff Reform issue, and after other speeches Mr. Balfour insisted on certain difficulties, especially that set up by foreign competition, but supported the second reading; to these Mr. Churchill replied that other nations were taking steps to deal with sweating, and that wages might be raised without affecting prices, to which, indeed, the wages paid often bore no relation.

It may be added that the Bill went to a Standing Committee, and was reported to the House and read a third time on July 16. A Labour attempt was made unsuccessfully to provide for the inclusion of other trades besides those scheduled; and the foreign competition question was again raised unsuccessfully by Mr. H. H. Marks. The Bill was extended by a provision that an employer convicted of paying wages below the minimum rate might also be ordered to make up the deficient wages; and a clause relating to sub-contracting was dropped. The Bill eventually became law (post, Chapters IV., V.).

Turning to the administrative work of the Government, the Postmaster-General's annual statement on the occasion of the Vote for his Department (April 27) indicated that the revenue was somewhat interfered with by the new facilities given. The halfpenny post competed with the penny post, the telephone both with the post and the telegraphs. He mentioned that the Government would not allow anything in the nature of a monopoly in wireless telegraphy to grow up as against the State. When the licences lapsed in 1912, it would either take over the system or licence certain companies. Among improvements, recent and prospective, he mentioned the penny rate to America and the reformed magazine post to Canada, which had been very successful; the insured box post to foreign countries, the improved parcels post to the United States, Egypt and Argentina, and the cash on delivery post to various Colonies, which, however, would not be introduced at home. The additional work entailed on the officials by the Old Age Pensions Act had not interfered with the service. He asked the public to aid him to secure a holiday for postal servants, earlier closing, and a reduction of Sunday telegraph work. The Post Office had a turnover of 23,000,000l. and represented annual transactions amounting to 500,000,000l. The public might be satisfied with the way the work was done. A reduction of the vote, moved to emphasise various local and personal grievances, was negatived by 204 to 61.

Naval administration, however, continued to furnish occasion for attack. The agitation had taken various forms. Questions were put almost daily to Ministers regarding the two-Power

standard, the comparative capacity of German and British manufacturers for providing gun-mountings, the provision of docks for Dreadnoughts, and similar matters; but a check was given to the movement by the announcement made by the Prime Minister in the House of Commons on April 22, that an inquiry would be held into the points raised by Lord Charles Beresford in a recent letter to the Admiralty, regarding the readiness of the fleets in Home waters during the last two years for national defence. The exact terms of reference, however, were not stated, but the inquiry was to be conducted by a sub-committee of the Committee of Imperial Defence. The attacks on the First Sea Lord of the Admiralty had meanwhile been further embittered by a speech made by Sir George Armstrong, a chief proprietor of the Globe and a retired naval officer, at the Constitutional Club on April 2. He then read a letter written to Sir John Fisher in 1906, shortly after he became First Sea Lord, by a junior captain, giving the opinions of the writer regarding certain of his senior officers and his impressions of conversations with various officers regarding the First Sea Lord's schemes. This letter, Sir George stated, had been printed and circulated among the writer's superior officers, marked "Private and secret"; it really amounted to establishing a system of espionage. The writer proved to be Captain R. H. Bacon, who had become Director of Naval Ordnance, and a little later the subject provoked repeated questions in the Commons (p. 122). But even the naval agitation was cast into the shade by the Budget, which was intimately connected with naval needs.

Before dealing with the Budget Statement, however, we must, in accordance with custom, supplement the account already given of the charges for the Navy and Army for 1909-10 by a brief account of the Civil Service Estimates, published at the end of March, with the accompanying Memorandum by the Financial Secretary to the Treasury.

CIVIL SERVICE ESTIMATES.

Net Total, 1909-10.

40,070,1711.

Original Estimates, 1908-9.
30,496,9471.

Increase. 9,573, 2241.

The large increase was mainly due to the provision of 8,750,000l. for Old Age Pensions in Class VI. Apart from this provision in 1908-9 and 1909-10, the net increase in respect of Civil Services was 431,7281. In the abstract and throughout the detailed Estimates comparison was made, according to the usual practice, with the total grants, including supplementary Estimates, made for the service of the year 1908-9 in the session of 1908. On this basis of comparison the Civil Service Estimates for 1909-10 showed an increase of 7,981,7281. There were two Votes beyond the original number for 1908-9, viz., Old Age Pensions and Government Hospitality.

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The chief increase was under Public Buildings, Great Britain (97,1007.). These comprised official residences for the First Lord and the Senior Naval Lord of the Admiralty, Meteorological Offices, extension of the National Gallery, transfer of

the Recruiting Station near it to Scotland Yard to admit of future extension of the National Gallery and National Portrait Gallery and to minimise risks from fire, extension of the Patent Office, additional Courts of Justice, and certain alterations at Edinburgh. There were decreases of expenditure under Royal Palaces, Royal Parks and Pleasure Gardens, and other heads.

CLASS II.-SALARIES AND EXPENSES OF CIVIL DEPARTMENTS.

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Notable increases were 18,7091. for cost of administering the Small Holdings and Allotments Act, 1907; 42,000l. to make good the loss on light gold coin withdrawn from circulation; 6,000l. towards experiments in Irish tobacco cultivation; and 6,000l. for Forestry.

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The Prisons Estimate for England and the Colonies showed an increase of 33,3921., due mainly to an abnormal increase of petty crime in certain regions; 11,500l. was allotted towards a new prison in the Isle of Wight for "preventive detention" under the Prevention of Crime Act, 1908; and 6,000l. and 1,300l. for buildings at Borstal and Lincoln in connection with the "Borstal system" of dealing with juvenile-adult delinquents. The Reformatory and Industrial Schools Estimate for Great Britain also showed a large increase (24,6731.), due mainly to the operation of the Children Act, 1908, but partly also to industrial depression in increasing the number of committals to these institutions and reducing payments from parents, partly to greater local activity in dealing with youthful offenders. The cost of the Royal Irish Constabulary had been raised about 21,000l. by the recent increase of the force, and by about 15,000l. by the grant of increased pay under an Act of 1908. The total, however, showed an increase of only 26,0161.

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The Estimate for the Board of Education showed a net increase of 60,9867., including 21,000l. for preparing the new Art Museum buildings at South Kensington. Grants were provided in aid of the Welsh National Library (2,000l.) and Museum (4,500l.) and the Welsh University and Colleges (15,000l.). There were increases of 98,9841. and 77,103. in the grants for Public Education in Scotland and Ireland, respectively.

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The Diplomatic Service Estimate included 2,000l. for the International Opium Commission at Shanghai, and 5,000l. for the anticipated Conference on Near Eastern Affairs; 10,000l. was inserted to provide and maintain a steamer for British Consular Officers on the Upper Congo. The Colonial Services Estimate showed a net increase of 34,1457. The grants in aid of Nyassaland, British East Africa, Uganda and Somaliland had increased, those for Northern Nigeria, Bechuanaland and Wei-hai-Wei decreased. There was a considerable increase (38,4371. against 28,0051.) for the expenses under the Anglo-French New Hebrides Convention.

CLASS VI.-NON-EFFECTIVE AND CHARITABLE SERVICES.

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The provision for the expenses under the Old Age Pensions Act (8,750,000l.) was 8,700,000l. for pensions, and 50,000l. for expenses of local Pension Committees.

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The decrease was due to the non-recurrence of grants voted in July, 1908, for repayments to the Civil Contingencies Fund (for which an Estimate would be presented later), expenses under the Unemployed Workmen Act, and relief of distress in Ireland; 10,000l. was set aside for Government hospitality, as against 5,000l. for part of 1908-9.

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The Post Office Estimate (18,977,9301.) showed an increase of 656,3991. on 1908-9. Of this, 94,000l. was due to the extra work caused by Old Age Pensions and Local Taxation Licences.

The charges transferred from local to Imperial funds were as follows:

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The Budget statement was made by the Chancellor of the Exchequer on Thursday, April 29. Both in the House and the country it had been awaited with apprehension. It had been predicted that "the resources of Free Trade Finance were bankrupt"; that the land taxes advocated by many Liberals could not be applied without a preparatory Valuation Act, which the peers would never pass; and that Mr. Lloyd-George would raid the sinking fund, increase the liquor licence duties, add to the income-tax (by a super-tax on large incomes, or otherwise) and reimpose on coal, sugar, tea and tobacco the burdens lately removed.1

Mr. Lloyd-George had lightened his arduous task by circulating a printed Memorandum of the financial results of the past year, and of the revenue and expenditure for the current year on the basis of existing taxation, instead of summarising these statements viva voce as had been done by his predecessors. This Memorandum stated that the revenue had been affected by the severe depression of trade, of which various indications were cited, so that it had fallen short of the Budget Estimate by 1,502,000l. But for large clearances of dutiable goods made at the end of March (and bringing in some 550,000l.), the deficiency would have been greater. Allowing 1,270,000l. for the transfer of the collection of local taxation licences to the County Councils,

1 Against such reimposition on coal the insurance premium at Lloyds was 30 to 45 guineas per cent., on sugar and tea 25 to 30 gs.-latterly not so much; on beer, 45 gs. Against land taxes the rate was 50 guineas per cent., against motor. car taxes 70 to 75 guineas per cent. (Morning Post, April 30).

the estimated revenue had been 153,080,000l., the estimated expenditure 152,839,000l.,which latter had been increased by supplementary estimates of 1,483,000l. to 154,322,000l., leaving a deficit of 1,242,000l.; but the actual Exchequer issues were 152,292,000., the actual revenue received was 151,578,000l., leaving a deficit of 714,000l. The Customs revenue had corresponded exactly to the estimate, falls in spirits and sugar being counterbalanced by increases in tea and tobacco. In Excise there was a falling off of 580,000l. Since 1899 there had been a substantial and steady decline in the consumption of beer and spirits; in 18991900 the figures were 32:29 and 118 gallons respectively per head of population; in 1908-9 they were 26:47 and 87. Death duties fell below the estimate by 1,130,000l.; stamps by 310,000l.; income-tax exceeded it by 930,000l., and the gross income brought into review by the Inland Revenue Department had for the first time exceeded 1,000,000,000l. Since 1899-1900 it had increased by more than 31 per cent. and the yield of each penny by more than 20 per cent., notwithstanding the relief given to earned incomes in 1907-8. During the same period the total revenue had risen by more than 15 per cent. and that derived from direct taxation by 26 per cent. The Postal, Telegraph and Telephone revenue was the same as in 1907-8. The non-tax revenue exceeded the estimate by 28,000l. The final balance-sheet for 1908-9 was as follows:

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Dealing with the coming year, the Memorandum gave the

following tables :

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