AMENDMENT BILL. had discharged the following Member FACTORY AND WORKSHOP ACT (1901) from Standing Committee B: The Lord Advocate; and had appointed in substitution (in respect of the Children Bill): Mr. Solicitor-General for Scotland. "To prohibit employment between noon on Saturday and six o'clock on Monday morning in cotton, woollen, worsted, flax, hemp, silk, jute, and paper works," presented by Mr. Jowett; to be factories, and in bleaching and dyeing read a second time upon Monday next, and to be printed. [Bill 207.] BUSINESS OF THE HOUSE (SUPPLY). Ordered, That the proceedings on the Licensing Bill have precedence this day of the Business of Supply.-(Mr. Asquith.) LICENSING BILL. Order read, for resuming Adjourned Debate on Amendment to Question [28th April], "That the Bill be now read a second time ": Which Amendment was, "To leave out from the word That,' to the end of the Question, in order to add the words this House declines to proceed further with a measure which, while failing to promote the cause of temperance, violates the principles of equity,' (Mr. Cave,)-instead thereof.' Question again proposed, "That the words proposed to be left out stand part of the Question." When the debate was interrupted last *MR. GEORGE FABER (York): evening I was endeavouring to establish that there was no warranty for the two propositions at the root of this the wholesale reducmeasure-first, tion of licences during the next fourteen years, and at the conclusion of those fourteen years the resumption by the State of the monopoly value of all the remaining licences. As regards the first of those two propositions, I venture to say that there is nothing to be found anywhere in the judgments in "Sharp v. Wakefield" to support it. An hon. Gentleman sitting below the gangway yesterday questioned this, but I have read the judgments many times, and can say with confidence to the House that the observation I made last night on that decision is fully warranted by the facts. "Sharp v. Wakefield" laid down that it was in the power of the licensing magistrates to suppress a licence at the end of any year on the ground of superfluity, but the Judges | number of public-houses and beer-on-licences expressly said that each shall be everywhere reduced.” case must be decided on its own particular merits and upon nothing else, that the decision in fact must be based upon the particular circumstances surrounding the particular case. The present Bill does not proceed in any way on those lines, and no doubt it does not intend to. Do not then let any hon. Member quote "Sharp v. Wakefield" in support of this arbitrary reduction of licences. The timelimit proposed by this Bill seems to me, apart altogether from the question of the recovery of the monopoly value, to be a bad proposition, and I think that the course followed by the Act of 1904 was superior in every respect, because under that Act there is elasticity, whilst here there is a cast-iron system that cannot be departed from in any instance. So many licences have got to be suppressed in so many districts in so many years. In fact the Government are setting up a bed of Procrustes in which the licensed properties of the country are to be laid. It does not matter whether the limbs are good or bad; if they do not accommodate themselves to the procrustean bed they are to be lopped off independently of whatever virtues they may be possessed of. Thus I venture to give a categorical answer to the question asked by the Prime Minister as to our views with regard to the time-limit. My views are entirely opposed to any time-limit. As regards the second proposition, which is a much more difficult one, and contains within itself the very core and kernel of the whole measure, and that is the recovery of the monopoly value of all licences left at the end of fourteen years by the State, where do the Government find any warranty for such a proposition? It is not even in the Minority Report of the Licensing Commission, let alone the Majority Report. All through the arguments, whenever it has been possible to do so, the Government have quoted the Minority Report, and here is one of the fundamental findings on this matter by the Minority Report. I cannot find a word in it about the recovery of monopoly value. They say, on page 268 of the Report "We recommend the adoption of a term, say seven years, as the basis of a time for compensation arrangements under which the They do not go on to lay down any views as to the recovery of monopoly value; they stop short at the statutory maximum. In March, 1903, years after this expression of opinion, I find, from a recent quotation in The Times newspaper, that the Archbishop of Canterbury presided at a conference where influential gentlemen of all shades of opinion, including Lord Peel, were present, as well as many members of the trade, when a resolution was passed to the effect that "In order to facilitate the considerable reduction of licences, the conference was of opinion that provision should be made for compensation at interest for licensed property, from a fund raised by the trade, and that it dispossessed otherwise than for misconduct, was desirable that ante-1869 beerhouses should be placed on the same footing as other licensed houses." Even a time-limit was not mentioned. The recovery of the monopoly value was never mentioned from first to last, and therefore I think I am warranted in saying again that the Government, in establishing this cardinal proposition of the recovery of the monopoly value by the State, have no precedent on which to found such an action. It rather reminds me of another phrase greatly in vogue among forward politicians below the gangway, viz., the nationalisation of all the means of production. I think the recovery of monopoly values and the nationalisation of all the means of production are born of the same father, and are half-brothers. The father is confiscation, while the mother of the one is plain speech and of the other subterfuge. About the one there is no possibility of doubt as to what it means. The Socialist Members below the gangway never hide their meaning, but upon the other there rests a makes it extremely dangerous, at any certain veneer of respectability which ter in his speech a few days ago, and other rate for the unwary. The Prime Minisspeakers who followed him on the other side, were rather cruel and hard upon the great brewery interests of this country. I see sitting opposite me a right hon. Gentleman, the son of a great statesman who has passed away, Sir William Harcourt. What did he say on one of the many Licensing Bills, one of the many Liquor Bills, brought forward by the bentures, £250,000 pre-prefence stock, other side, for the consideration of this £150,000 preference stock, and £100,000 House? In 1868 he said— ordinary stock. In 1904 what do we find? We get this ominous sentence in the seventh annual statement "There is nothing in the world so cruel as the tender mercies of a real philanthropist." and The directors have for some time past been of opinion that it was necessary that some scheme of reconstruction of the company should be devised and carried through, having regard to the surrenders above referred to, and the high capitalisation of the company on former issue." One When Sir William Harcourt was talking of the real philanthropist he was talking on a Liquor Bill, of temperance reformers; if he was alive to-day I think he would be able to go one better say, "There is nothing in the world so cruel as the tender mercies of the real temperance reformer, coupled with the What happened? The company's tender mercies of a Chancellor of the capital is written down by no less a sum Exchequer looking out for money to provide than £100,000, and the people who had for old-age pensions." Of course, we all to pay for that disagreeable operation know that there are brewery companies were the ordinary shareholders. They and brewery companies. Some have did not like it, and when the meeting been inflated and some have not; some came on there was some demur. have had shares watered and some have gentleman asked the following question: not; but it does not go outside the bounds "If the scheme of writing down the value of comprehension that even an aerated of the company was carried out would the water company should be brought forward as a company upon inflated lines. In fact, I often think the chief merit of aerated water is that peculiar inflated quality. It was, I think, the hon. Member for the Appleby Division of Westmoreland either yesterday or the day before, who was pleased to divide the parties in this House into the just and the unjust. He did not say the sheep and the goats, and perhaps I may be allowed to add to his definition in that respect. Humanity, either in this House or out of it, falls into no simple category of that was auditors give us any assurance that the property of the company was worth the The answer given by Mr. Grimshaw, one amount given in the balance-sheet?" The answer given by Mr. Grimshaw, one of the auditors, was that that hardly a fair question to put to the auditors; it would puzzle an expert to say what was the worth of the property, but he would say that the amount would be nearer the mark after the reduction of £100,000. Now, who is the fortunate vendor? I am sure hon. Gentlemen on the other side of the House are burning kind. There are sheep and to know. Well, his name is Mr. George goats on both sides of the House, Whiteley, M.P. Let me at once disand, Mr. Speaker, I venture to say that abuse the mind of this House of the idea if that over-confident judgment of the that I have any sinister intention in hon. Member was appealed against, and bringing a matter of this sort forward. came up before you, Sir, for decision, I am I do not blame the Patronage Secretary, not at all sure you would not reverse the but how is he going to answer to the high position of the sheep and the goats, and canon of morality that is set up by the put the sheep on your left hand and the other side of the House, and what answer goats on your right. Bearing on my has he got to make to his own Prime remarks that there are companies and Minister, who has expressed himself so companies, I have a case in my hand which strongly regarding inflated breweries? is directly upon this point, the case of an I must leave it to the right hon. inflated brewery company. The com- Gentleman to determine. pany was promoted in 1897, and floated assuming that you do not interfere with during that year with a capital of the allocation of the sheep and the goats £500,000, £250,000 being issued in made by the hon. Member for the Appleby debentures, and £250,000 ordinary shares Division, and that the sheep still rest on being retained by the vendors. ["Name."] your right hand, I am afraid the shepherd I will state the name before I of the flock is going to have rather a difficult have finished. The company was re- task when a division is called on Monday floated later in the sme year, at night, and he has got to drive the im£750,000, of which £250,000 were de-maculate flock into the division lobby. Mr. Speaker, I do not forget that in those unregenerate vided that the trade, where licences days the right hon. Gentleman had not were suppressed, should find the comfound salvation. Perhaps one of these pensation." I agree, we did provide a days-who knows, it is a strange world- precedent, but look how different the cases the right hon. Gentleman may find him- are. Under the Act of 1904, after providself back among the goats. But seriously, ing for the suppression of licences, the does not this illustrate the folly of monopoly was left to the trade, and you laying down any general proposition may fairly say that each suppression about inflated brewery companies and to of a licence increased the monopoly, found upon that the argument that if so that the trade which had paid anybody is to blame for the hardships for the suppression of licences we.e contained in this Bill, it is not the in a superior position as regards State, but the brewery companies, and the licences that were left. That if money has been lost it is the wicked is logical, and the Act of 1904 probrewery companies, and not the State, ceeded on that basis. It was because which is responsible. I may be stupid, I the monopoly value was left to the trade often think that I must be, but I cannot for and was not passed over to the State the life of me follow the logic of that that the trade provided the compenargument. I agree that if a shareholder sation. But what is done here? has been foolish enough to put his money The analogy does not apply. How can into a watered brewery company or a you call upon the trade during fourteen watered any other company, he deserves years to find compensation, when on the what he gets. He has got to "stew in conclusion of that period the State is going his own juice," a phrase used by Sir to take over the remaining licences? William Harcourt, but because the share- There is not one farthing of compensaholder has to stew in his own juice there tion paid by the State of any sort or is no reason why he is to be again in any way for the suppression of these put into the pot and on the fire and licences. I will not linger over the stewed in the Government's juice. Why monstrosity, but, speaking as a banker, should he stew twice over? Surely it is for I am not a brewer, I do sufficient for the unfortunate shareholder feel this matter to the very core to suffer for his own initial folly, and not of my heart, the injustice of it strikes have to suffer the confiscation which me so forcibly. Thus then, the commust follow, as certainly as night pensation is to be provided by the trade, follows day, the course of procedure but even so you do not allow it to be laid down by the Government in generous compensation; you have cut this Bill. When you come to the it down to the lowest possible limit. compensation clauses, and there let me You are only allowing fourteen years speak quite simply as a business man, for the suppression of 30,000 licences, is it not a farce to call it compensation? and you have to make the compensation Is the State paying one single farthing go as far as you can, and there is not either during the compensation period, sufficient of it. Instead of providing or at its conclusion-is it paying a for the compensation which has been single farthing for the 30,000 odd licences held proper in the Ashby Brewery which are to be suppressed, or for case, against which the Inland Revenue the 60,000 remaining licences that authorities, with the Chancellor of the are to be pouched by the State Exchequer behind them, did not appeal, upon the conclusion of the four- and of which the Lord Chief Justice, teen years? Not one single farthing. by way of obiter dictum, the other day You call that compensation, and you approved, your basis of compensation think you are going to take in is unfair and unsound. Now, let me the bishops and the confiding British take this further point which may not public, by leading them to believe have occurred to some hon. Members that the State is giving compensation who are not, I hope, for their own for this gigantic property which sakes, conversant with company matters. is proposed to take away. I can Think what chaos there is going to be imagine hon. Gentlemen opposite saying, during the fourteen years, because the "Very well, but the Act of 1904 also pro- Prime Minister said, when introducing it 66 This the Bill, that it will be the duty of in another position still. So long as every prudent brewery company to set the debenture-holder gets his interest up an insurance fund, so as to provide and the preference shareholder his against the termination of the time-limit. interest, they can do nothing, but the But in very many, in most, cases it will ordinary shareholder will say: be a matter of absolute pecuniary insurance fund will not suit me, because impossibility for brewery companies it will never reach me. What I shall I am not talking of the inflated do is to get all the interest I can brewery company, but the fair, honest after the fixed interest is paid, and brewery company, founded upon fair a fig for the insurance fund. I have and honest lines - in addition to to save my skin." That condition of excise duties, rates, rent and taxes, things is certain to arise the moment you and compensation levies, to pro- pass this Bill. All these questions must vide these new insurance funds. arise. Who is going to settle them? I have no reason to doubt the many skilled auditors whose opinions have been quoted on that subject, and if they are wrong there has been an opportunity of having their findings corrected. No doubt they are right, and the House must feel with me that they are right be fortunate, or in my when they say it is a matter of impossibility to get round in fourteen years and establish, in lieu of the licences that are taken away, a sinking fund that will correspond to their value. But the matter does not end there, because all shareholders do not stand in the same position. There are different kinds of shareholders in the same company. What is going to happen when you try to set up an insurance fund? It will suit one class of shareholders and not another. The debenture-holder has security. He has the bricks and mortar for what they are worth. He would have had the licences as well, but you are going to take them away. He has the bricks and mortar, but that in all probability will not be sufficient to cover him, and therefore he will want the insurance fund to make up the deficiency. But the other share holders will say to the debentureholder: "Not quite so fast, my friend. Although an insurance fund may suit you, it may not suit us." The preference shareholder has no security, he only has his fixed interest, he is not in the comparatively happy position of the debenture-holder, and if the insurance fund does not reach him he will lose all his capital. He will want his interest and his capital, but he will probably try to balance the matter and say: "Shall I take my interest, or shall I forego my interest and depend on this fund for my capital?" The ordinary shareholder is Mark me, you are going to have con- |