by Roy Jenkins
For the next fortnight the House was occupied with the Irish Land Bill and the Housing Bill. The former, particularly, was moderately controversial,1 but as it guaranteed the presence and support of the Nationalists, the time devoted to it enabled many Liberals to take a short holiday. Progress on the Finance Bill was resumed on Wednesday, September 1. Thereafter, until the end of the committee stage more than a month later, only five parliamentary days were not devoted to it, and for the last three weeks, from September 20, it occupied the whole of the time. During this last lap (from September 1) the House did not sit quite so extravagantly late as it had been doing. There were no sittings that lasted until breakfast time; but there were four that lasted until after 3.0am and another five which lasted until 2.0am or later; and on only one occasion, except on Fridays (and there was a sitting until dinner time on one of these), was the business concluded before midnight.
The committee stage was finally concluded on Wednesday, October 6—the forty-second allotted day—and on the Friday the House adjourned for a week. After the reassembly, nine days, without late sittings, were devoted to report, and this stage of the bill was obtained on Friday, October 29. There remained only third reading, and this, after three days of debate, was carried by 379 votes to 149, at 11.30pm on Thursday, November 4. The bill was sent to the Lords, and the Commons went away for nearly three weeks.
In all, it had taken seventy parliamentary days to get the Budget through the House of Commons, and there had been 554 divisions—in the whole session there were no less than 895, as against a mere 383 in a very busy modern year like 1946-47. The strain on the Chancellor of the Exchequer had been immense, although he had received more help from his colleagues than would be normal today. Apart from his assistant at the Treasury1 and the Solicitor-General, the Prime Minister, the Secretary of State for War, the President of the Board of Trade, the Chancellor of the Duchy of Lancaster, the Attorney-General and a number of junior Ministers all assisted him at the despatch-box. Haldane led for the Government throughout almost the whole of one all-night sitting, and Asquith on a number of occasions came down to the House after a short night and an early breakfast at Downing Street, and took over for the last hour or two of a long sitting. At more attractive times of day relief was still easier to obtain. Nevertheless, the brunt of the burden inevitably remained on the Chancellor’s own shoulders. Some rough guide to the regularity of his attendance is given by the fact that he voted in 462 of the 554 divisions.2 But his demeanour was more important than his presence, and there seems to be general agreement that at all stages of this arduous process his behaviour in the House was courteous, skilled and, where no point of principle was involved, conciliatory. It was a most distinguished parliamentary performance.
The strain of the summer on the Liberal back-benchers, while obviously not so great as on the leaders, was also considerable; and they did not have the glory to compensate. Voting without speaking is always a dismal business. Fortunately the majority was such that a very rigorous system of whipping was not necessary. In none of the 554 divisions was there even the threat of a Government defeat. As a result, the Patronage Secretary was able to spread the burden fairly thin. There was not much indication, even during August, that many Liberal members were abroad or in the country, for the numbers voting early in the day were often surprisingly high —250-300 was quite common. But late at night only the minimum number was kept on duty. After about 2.0am the Opposition vote normally fell to between forty and sixty, and the Government obviously made little attempt to keep more than its ‘closure vote’1 and a margin of perhaps 15 to 20. In this way the strain of the session was made tolerable.
Sustained and severe though the struggle was in the House of Commons, it was little less so in the country; and here the issue was more open to doubt. At first the Budget did not appear to be popular. This impression came partly from a chance Liberal defeat at the Stratford-on-Avon bye-election which followed a few days after its introduction; partly from the greater speed with which the Unionist leaders took to the platforms; and partly from the fact that the City shouted so loudly that it seemed at first that there must be many others helping the financiers to make the noise. This campaign in the City reached its crescendo on June 23, when a crowded meeting of influential businessmen, under the chairmanship of Lord Rothschild, met in the Cannon Street Hotel. Many of those present were normally supporters of the Liberal Party, and this, together with the fact that Lord Rosebery had used the previous day’s issue of The Times to publish his first denunciation of the Budget, made some Liberals a little nervous of developments in their own party.
At this stage, however, the supporters of the Government re-took the initiative. On the same day as the City meeting, a meeting in the House of Commons set up the Budget League, with Mr. Churchill as president, to conduct a vigorous campaign in the constituencies; and on the following day Lloyd George delivered a sharp riposte to the businessmen. ‘We are having too much Lord Rothschild,’ he said. ‘Some countries would not have their politics dictated by great financiers, and this country would join them.’1
Thereafter there was a spate of Liberal oratory. Mr. Churchill was perhaps the most indefatigable (and certainly one of the most violent) speakers in support of the Budget, but the Prime Minister did at least his fair share of campaigning, even braving a Cannon Street Hotel audience in July. The Chancellor himself, either by design or because he was fully occupied in the House, was very quiet. Apart from the speech in which he replied to Rothschild and one delivered at the Bankers’ Dinner on July 16, in which, perhaps wisely but certainly unusually, he confined himself to a few technical revenue points, he made no public appearance until the end of July. Then, on the thirtieth of the month, he went to Limehouse and addressed an audience of 4,000 people at the ‘Edinburgh Castle’. It was his first full-scale defence of his Budget before a popular audience, and he did not neglect the opportunity. He justified the land taxes by quoting instances of extortionate profiteering by landlords—and he carefully chose his examples from amongst the dukes. He resisted the charge that these taxes would be a burden upon industry.
‘We are placing the burdens on the broadest shoulders,’ he said. ‘Why should I put burdens on the people? I am one of the children of the people. I was brought up amongst them, I know their trials, and God forbid that I should add one grain of trouble to the anxieties which they bear with such patience and fortitude. When the Prime Minister did me the honour of inviting me to take charge of the National Exchequer at a time of great difficulty, I made up my mind that, in framing my Budget, no cupboard should be barer, no lot should be harder to bear. By that test, I challenge them to judge the Budget.’m
The speech produced sharp reactions. It provoked tumultuous applause from the audience, the most widespread and detailed attention in the newspapers, a letter of rebuke from the King, a howl of execration from some landowners, and an even more unfortunate attempt at reasoned reply from some others. Lord Lansdowne described the Chancellor as ‘a robber gull’, the Duke of Beaufort said that he would ‘like to see Winston Churchill and Lloyd George in the middle of twenty couple of dog hounds’, and the Duke of Rutland described the whole Liberal Party as a crew of ‘piratical tatterdemalions’. The Duke of Portland, on the other hand, took up the point about ‘bared cupboards’, and attempted to show that a great many people’s cupboards would in fact be bared as a result of the reduction in staff which great landowners would be obliged to undertake. The Duke of Buccleuch gave practical shape to this principle by refusing a guinea to a Dumfriesshire football club because of the Budget proposals.1 But neither this nor the Duke of Somerset’s statement that he would have to discharge his own estate hands and reduce his gifts to charity were very well received by the public. People were getting a little tired of the troubles of the dukes and their excessively personal view of politics.2 They were doing the Chancellor’s propaganda for him even better than he could do it himself. This was widely felt, and a Conservat
ive member of Parliament3 went so far as to attack them very bitterly in a public speech:
‘He only wished the Dukes had held their tongues, every one of them.… It would have been a good deal better for the Conservative Party if, before the Budget was introduced, every Duke had been locked up and kept locked up until the Budget was over.… These men who are going about squealing and say they are going to reduce their subscriptions to charities and football clubs because they were being unduly taxed ought to be ashamed of themselves, Dukes or no Dukes.’n
Whether because of Lloyd George’s Limehouse speech and the replies which it provoked or for more general causes, there was a very widespread impression at the beginning of August that the tide had turned in favour of the Government. The Times of August 4 said that the fate of the Budget had ceased to be precarious, and on the following day the Daily Mail (which was also owned by Lord Northcliffe) announced that outside the City the campaign of the Budget Protest League had fallen flat. Apparently its promoters had sometimes met the humiliating fate of having their resolutions defeated at their own meetings.o
Whether or not the issue was decided, however, the campaigns continued unabated throughout August and September and into October. On September 4, Mr. Churchill was telling a Leicester audience that ‘the tax-gatherer would now ask, not what have you got, but how did you get it?’ On the tenth, Lord Rosebery, who had just resigned the presidency of the Liberal League, was making his second public attack on the Budget, and defending the dukes as ‘a poor but honest class’. A week later there began the Birmingham battle between the leaders of the two parties, when Asquith spoke to an audience of 10,000 people in Bingley Hall and an overflow meeting of 3,000 on September 17, and Arthur Balfour answered him at the same place on the twenty-second. Early in October there came Lloyd George’s great series of meetings at Newcastle-on-Tyne. But more and more the issue was coming to be, not so much whether the Budget was desirable in itself, but whether or not the House of Lords was entitled to reject it, and what would be the constitutional consequences if it did. And this was another story.
V To Reject or not to Reject
The peers had not rejected a Finance Bill for more than 250 years; and their attitude towards the Old Age Pensions Bill of the previous session had given a very recent indication that even in their most recalcitrant mood they went in some awe of the doctrine of Commons’ supremacy on money matters. It was not therefore surprising that during the early stages of the battle of the Budget there was no open discussion on either side of the possibility of a Lords’ rejection. The Annual Register recorded no reference to the matter before July 16, when Lord Lansdowne somewhat ambiguously announced that ‘the House of Lords would do its duty, but would not swallow the Finance Bill whole without wincing’.1 By August 9, with the Limehouse speech to encourage him, he was leaning much more openly towards rejection, and Sir Edward Grey, in a reply on the following day, summed up the position by saying that ‘Mr. Balfour and Lord Lansdowne are keeping two doors open. They are debating whether they should pass the Budget or not. We know their wishes, not the extent of their nerve.’a By the time of the Prime Minister’s Birmingham speech on September 17 the indication that the Lords proposed to reject had grown stronger, and, in his own words, he ‘thought it right to use the plainest language’.b ‘Amendment by the House of Lords,’ he said, ‘is out of the question. Rejection by the House of Lords is equally out of the question. … Is this issue going to be raised? If it is, it carries with it in its train consequences which he would be a bold man to forecast or foresee. That way revolution lies.’
The Unionists paid little attention to his warning, and at their own meeting at the same place a week later Austen Chamberlain read out a letter from his father which expressed the hope that the Lords would force an election, while one of the supporting speakers1 said that ‘the peers are not worthy of their seats if they do not reject the Budget’. Arthur Balfour was far more guarded, but there can be little doubt that by this time his mind was quite firmly made up in favour of rejection.
Lansdowne’s biographer, after quoting a letter to show that by October 2 Lansdowne had reached his own decision to reject, notes that ‘Mr. Balfour had, from an even earlier period, believed that a compromise was impossible.’c When, therefore, the Unionist leaders were summoned to see the King on October 12 they had already come down quite decisively on the side of rejection.
This audience took place on the initiative of the Sovereign himself, but with the full approval of the Prime Minister. At the end of September King Edward had the rumours of the summer confirmed by a memorandum, pronouncing strongly in favour of rejection, which Lord Cawdor, who was staying at Balmoral, drew up and presented to him. On receiving this the King summoned Asquith to Scotland, expressed his own desire to avoid a collision between the two Houses by the discovery of some via media,1 and secured the agreement of the Prime Minister to his talks with Balfour and Lansdowne.
These talks served little purpose. The Unionist leaders informed the King that no definite decision had been reached, which was formally correct, as no meeting of the Unionist peers had taken place;2 but they knew, and he knew, how utterly remote had become the chance of a moderate course being chosen.
The Liberals also knew how nearly the die was cast, and however fanciful may be the theory that Lloyd George had originally framed his Budget with the principal object of exciting the peers, there can be no doubt that he and Mr. Churchill and some others were now extremely anxious that rejection should take place. ‘It would give the Government a great tactical advantage,’ Mr. Churchill informed the National Liberal Club on October 8.d
The famous speeches which the Chancellor of the Exchequer delivered at Newcastle-on-Tyne during the week-end of October 9-11 were therefore designed to inject the maximum amount of heat into the already torrid controversy, and to make it as difficult as possible for the Unionists to retreat from the dangerously exposed positions they had already taken up.
‘They are forcing revolution,’ he said. ‘But the Lords may decree a revolution which the people will direct. If they begin, issues will be raised that they little dream of, questions will be asked which are now whispered in humble voices, and answers will be demanded then with authority. The question will be asked “Should 500 men, ordinary men chosen accidentally from among the unemployed, override the judgment—the deliberate judgment—of millions of people who are engaged in the industry which makes the wealth of the country?” That is one question. Another will be, who ordained that a few should have the land of Britain as a perquisite; who made 10,000 people owners of the soil, and the rest of us trespassers in the land of our birth; who is it—who is responsible for the scheme of things whereby one man is engaged through life in grinding labour, to win a bare and precarious subsistence for himself, and when at the end of his days he claims at the hands of the community he served a poor pension of eightpence a day, he can only get it through a revolution; and another man who does not toil receives every hour of the day, every hour of the night, whilst he slumbers, more than his neighbour receives in a whole year of toil? Where did the table of that law come from? Whose finger inscribed it? These are the questions that will be asked. The answers are charged with peril for the order of things the Peers represent; but they are fraught with rare and refreshing fruit for the parched lips of the multitude who have been treading the dusty road along which the people have marched through the dark ages which are now emerging into the light.’e
It was a wonderful popular oratory, with enough weight of content—an explosively radical content too—for there to be no question of dismissing it as mere froth. Some of the imagery might be a little lurid for fastidious tastes—Lord Knollys begged the Prime Minister ‘not to pretend to the King that he liked Mr. Lloyd George’s speeches, for the King would not believe it, and it only irritated him’—but it was not intended for fastidious people. It was intended to rouse the mass support of the Liberal Party and to goad the peers into a r
ash truculence. Towards both these ends it was extremely conducive, although by October the former was more necessary than the latter.
The final decision was taken by the Unionist Party by November 10, a week after the Finance Bill had left the Commons, when Lansdowne gave notice that on second reading he would move ‘that this House is not justified in giving its assent to the Bill until it has been submitted to the judgment of the country’. The motion was most carefully drafted, by Balfour and others, so as to present the intervention of the House of Lords in the most popular light possible. To this end it was as well-conceived as any motion could be, but the awareness of danger which this reveals makes it only more surprising that such an experienced party as the Unionist Party, under such experienced leaders as Balfour and Lansdowne, should ever have decided upon a course so reckless as a peers’ rejection of a Budget. Their action did not kill the Budget, it greatly improved the electoral prospects of the Liberal Government, and it made the destruction of the Lords’ veto inevitable; and all these consequences could have been predicted by any intelligent observer, and were predicted by many people. Why did the Unionist leadership ever agree to such a course?
It was not through lack of good advice. On the purely constitutional and legal plane they were not perhaps very well served, for, of the leading authorities, the Unionists, Anson and Dicey, by declaring that rejection would be perfectly proper (in sharp conflict with the Liberal, Pollock, who declared that it would be most improper), showed themselves to be no more objective than most men. But there were plenty of sage Unionist politicians to point out the foolishness of the course which was being taken. The old Duke of Devonshire, who would undoubtedly have exercised a strong influence on the side of caution, had died in 1908, and Lord Goschen,1 who would have been on the same side, had predeceased him by a year.2 Nevertheless there was still Lord James of Hereford, Lord St. Aldwyn, and Lord Balfour of Burleigh, all of them former members of Unionist Cabinets and all of them most unhappy at the thought of a peers’ rejection.