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The Pamphlet Collection of Sir Robert Stout: Volume 81

Chapter VII. — The Lords and Finance

page 41

Chapter VII.

The Lords and Finance.

The Peers have constantly attempted to encroach upon the prerogative of the Crown and the privileges of the Commons. So far from accepting the subordinate position to which they were reduced by the catastrophe of 1832, they have persistently, stealthily, and not altogether unsuccessfully endeavoured to regain some of their forfeited power. They have attempted to usurp the Royal prerogative by attempting to dictate the proper moment for a dissolution of Parliament, and they have defied the authority of the Crown in refusing to allow it to exercise its ancient and heretofore unquestioned right to create life peers. Writing about the action of the House of Lords in the case of the Wensleydale life peerage, Edward A. Freeman, the eminent historian, whose authority is second to none on such a question, used the following emphatic language:—

The right of the Crown to create peers for life only had never been surrendered, never abolished, never doubted. But it had gradually gone out of use. It was at last exercised again in our own time, or, more truly, an attempt which was strangely unsuccessful was made to exercise it. The circumstances under which it was made were highly instructive. They show to what a height of presumptuous aggression the newer element in the House, the hereditary element, had grown. I refer to the peerage granted to Lord Wensleydale. That eminent lawyer was, according to a crowd of ancient precedents, created a peer for life only. He had no children, so that the question was not a practical one; it was simply that this occasion was chosen to assert an ancient and wholesome principle. But with matchless impudence the hereditary peers, in defiance of precedent, in defiance of law, in gross contempt of the lawful authority of the Crown, refused to let Lord Wensloydale take his seat in the House. And they were led by newly-created lawyers who assuredly knew that they were acting against law. . . . The Crown yielded its ancient and undoubted right; Lord Wensleydale, lawfully summoned to Parliament, was shut out from his seat until the new patent was granted securing the seat after him to the descendants who were not in being.

Presently, be it remembered, the hereditary peers had to submit to receive colleagues whose blood had not been ennobled. In full agreement with ancient law and usage official law lords not holding hereditary peerages but truly representing the ancient Witan of the laud now sit and vote in the House which refused a scat to Lord Wensleydale. The grotesque pride of the hereditary peers has surely received a little shock by their presence.

They have encroached upon the privileges of the Commons in their repeated attempts to meddle with questions of finance. But all the best constitutional authorities, all the great statesmen of both parties, have always asserted that the House of Commons, and the House of Commons alone, controls all questions of finance.

Mr. Balfour himself has declared that "you all know the House of Lords does not interfere with the financial policy of the country. He has told us: "We all know that the power of the House of Lords, thus limited, and rightly limited, as I think, in the sphere of legislation and administration, is still further limited by the fact that it cannot touch those page 42 money Bills which, if it could deal with, no doubt it could bring the whole executive machinery of the country to a standstill."—(House of Commons, June 24, 1907.) Again he said: "It is the House of Commons, not the House of Lords, which settles uncontrolled our financial system."—(Dumfries, October 6, 1908.) For centuries it has been a settled rule of constitutional law that the initiative in matters of finance lies with the House of Commons. The Peers may not vote money, nor may they meddle with the amount or sources of the supplies granted by the House of Commons.

This privilege of the Commons dates back for nearly six hundred years. In 1640 the House of Commons declared:—

We have had uninterrupted possession of this privilege (the privilege of the undisputed control over the taxation and finances of the country) ever since the year 1407, confirmed by a multitude of precedents both before and after, not shaken by one precedent for these three hundred years.

In 1671, when the House of Lords proposed to reduce the duty on white sugar from one penny to five-eighths of a penny in the pound, the Commons passed a resolution that:—

In all aids given to the King by the Commons, the rate or tax ought not to be altered by the Lords.

At a conference with the Lords they declared that the right they claimed "was a fundamental right, both as to the matter, the measure, and the time." The Lords, they said, could throw out a money Bill, but not amend it. The Lords retorted by passing a resolution asserting their right to do as they pleased. They said:—

If we cannot amend, or abato, or revise a Bill in Parliament, if we cannot amend, or abate, or alter in part, by what consequence of reason can we enjoy the liberty to reject the whole?

Seven years later the House of Commons passed a famous resolution, which ever since has formed the fundamental law governing all the proceedings between the two Houses in matters of supply. It was declared in a resolution voted by the House of Commons as far back as 1678:—

that all aids and supplies and aids to his Majesty in Parliament are the sole gift of the Commons, and all Bills for the granting of any such aids and supplies ought to begin with the Commons; and that it is the undoubted and sole right of the Commons to direct, limit, and appoint in such Bills the ends, purposes, considerations, conditions, limitations, and qualifications of such grants, which ought not to be changed or altered by the House of Lords.

The Lords did not venture to reject the Bill repealing the Corn Laws, although it was passed by a Parliament elected by a majority of Protectionists. Their right to reject a finance Bill was carefully identified with the right of the Sovereign to refuse his assent. Their assent, like the King's, was purely formal. As Pitt, afterwards Lord Chatham, said:—

Taxes are a voluntary gift and grant of the Commons alone ... In legislation the three estates are alike concerned, but the concurrence of the Peers and the Crown to a tax is only necessary to clothe it with the form of a law. The gift and grant is of the Commons alone. We represent the rest of the inhabitants. When, therefore, in this House of Commons we give and grant, we give and grant what is our own. The distinction between legislation and taxation is essentially necessary to liberty.

The Peers never ventured to reject a money Bill until 1860. Then they refused to pass the Bill repealing the paper duty. If Mr. Gladstone and Mr. Bright had not been in the House of Commons, the Lords would have succeeded in establishing a precedent fatal to the most ancient fundamental privilege of the House of Commons. Lord Palmerston, then Prime Minister, was more than inclined to betray his trust. But page 43 Mr. Gladstone retorted to this coup d'état by combining for the future all the financial proposals of the House of Commons in one Bill, so that the Lords could not reject them without dislocating the whole administration of the country. Lord Morley says:—

This was the affirmation in practical shape of the resolution of the House of Commons in the previous year, that it possessed in its own hands the power to remit and impose taxes, and that the right to frame Bills of supply in its own measure, time, and matter is a right to be kept inviolable. ... By including all the taxes in a single, finance Bill, the power of the Lords to override the other House was effectually arrested.

Speaking at Edinburgh, September 27th, 1893, on the consequences of this change of procedure, Mr. Gladstone said:—

The House of Lords during those two-and-thirty years has been absolutely excluded from all influence whatever upon the finances of the country. It was an abridgment of their province, and that province need never have been abridged if they had acted in if with discretion. But they chose to bo attracted by circumstances of momentary difficulty, which they thought they could turn to their account, and the result has been the permanent loss and destruction of a cherished and an important prerogative.

That was Mr. Gladstone's opinion. It was not the opinion of Sir [unclear: W] Anson. It certainly was not the opinion of the Peers themselves. [unclear: Wher] Sir W. Harcourt's Death Duties Bill came up to the House of Lords, [unclear: Lord] Salisbury denied that the Peers were constitutionally compelled to give [unclear: a] formal assent to money Bills. Lord Salisbury quoted as a precedent [unclear: the] fact that Lord Derby had moved an amendment to a money Bill [unclear: which] however, was rejected by a majority of 32. In the discussion that followed Lord [unclear: Herschell], then Lord Chancellor, drew attention to the very [unclear: importan] fact that the Judicial Committee of the Privy Council had formally [unclear: decided] and Her Majesty in Council had approved the decision, that the House [unclear: o] Commons has the sole gift of all aids and supplies and the undoubted [unclear: and] sole right to direct, limit, and appoint the Bills of aid and supply, the [unclear: end] purposes, considerations, conditions, limitations, and qualifications of [unclear: such] grants, which ought not to be changed or altered by the House of [unclear: Lords] The question arose from a dispute between the two branches of the Queens land legislature, in which both agreed to refer the question for settlement [unclear: o] the common ground that they held and discharged relatively to one [unclear: anothe] positions and functions analogous to those of the House of Lords an! House of Commons.

This judicial decision is important at this crisis, and should not be [unclear: los] sight of.

The Lords have, notwithstanding, made repeated attempts to [unclear: chang] and alter the conditions, limitations, and qualifications of money grants.

When the Parish Council Bill was before the House of Lords, in [unclear: 1894] the Peers ventured upon an encroachment of the privileges of the Common by amending the clause throwing the expenses of the Parish Council and of the parish meeting on the poor rate, so as to compel the Parish Council to levy its own rate. The Speaker said: "I think in this case an [unclear: infring] [unclear: ment] of the privileges of the House has been committed;" and he [unclear: adde] that if the Minister in charge of the Bill had not risen, "I should, as [unclear: the] guardian of the privileges of this House, have asked the House to [unclear: pa] these amendments over as an infringement of the privileges of [unclear: th] House."

Three years later, the Conservatives being in office, the new [unclear: Lo] Chancellor, Lord Halsbury, stood up as the champion of the exclusif right of the Commons to deal with finance. The question arose [unclear: o] April 2nd, 1897, on certain amendments proposed by Liberal peers to [unclear: th] page 44 Voluntary Schools Bill of that year. One of these amendments, which stood in the name of Lord Spencer, proposed to define the kind of Voluntary school which should receive the grant of public money. Another, in the name of Lord Kimberley, had reference to the constitution of the Associations to which were entrusted the spending and allocation of the money. Before either of these was moved, Lord Halsbury intervened with an objection that these and all other amendments of this class infringed the privileges of the Commons. He read to the House the well-known passage from Sir Thomas May, which lays down that "all aids and supplies, and aids to His Majesty in Parliament, are the sole gift of the Commons," and that "it is the undoubted and sole right of the Commons to direct, limit, and appoint in such Bills the ends, purposes, considerations, conditions, limitations, and qualifications of such grants, which ought not to be charged or altered by the House of Lords." Having recited this with a solemnity which is not yet forgotten by those who heard him, Lord Halsbury went on to say that, though the Lord Chancellor had no right to decide questions of order in the House of Lords, he should, if he had that right, summarily rule these amendments but of order; and then, when a mild objection was made by Liberal peers to the application of this doctrine in the particular case, he [unclear: proceeded] to argue very energetically that there could be no doubt. Lord Spencer's amendment, he said, "adds a condition to the grant of money which is within the express language of the protest of the House of Commons." The same argument manifestly applied with even greater [unclear: orce] to Lord Kimberley's amendments, and after a further brief argument [unclear: hey] were withdrawn.—(Hansard, Fourth Series, vol. xlviii., fourth volume [unclear: of] Session 1897.)

Notwithstanding this parade of unctuous rectitude the same Lord Chancellor was party four years later to a flagrant evasion of the [unclear: privieges] of the Commons. It took place in connection with the amendments made in the Education Bill of 1902, by which the Lords imposed the cost [unclear: of] providing for the wear and tear of denominational schools upon the ates. A less subservient House of Commons than that elected in the [unclear: Khaki] delirium of 1900 would have made short work of this usurpation. As things were the Commons waived their privilege and accepted the [unclear: mendment]. In the Education Bill of 1906, the Lords' amendments were [unclear: many] of them trespasses upon the privileges of the Commons and would [unclear: have] been so ruled out by the Speaker had they been discussed in detail [unclear: stead] of being rejected en bloc.

All their other offences are, however, thrown into insignificance by [unclear: heir] rejection of the Budget of 1909. This was an unprecedented act [unclear: of] usurpation as against the Commons, of rebellion as against the King. Never before in the whole history of Parliament had the Lords dared [unclear: o] refuse supplies to the King which the Commons had voted in response [unclear: o] his appeal. The facts are simple. It is common ground to both [unclear: arties] that additional taxation must be imposed to meet a deficit of £16,000,000, £8,000,000 being due to Old Age Pensions, and £3,000,000 to [unclear: n] increase in Naval expenditure. The King asked the Commons to [unclear: ovide] the money. The Commons did so provide it. But the House [unclear: f] Lords, by 350 to 75, usurped the authority of the Commons and refused [unclear: upplies] to the Crown. This action of the Peers has hitherto been [unclear: disussed] as if it were merely an interference with a money Bill, on all [unclear: urs] with their rejection of the Bill repealing the Paper Duty. This true, so far as the privileges of the House of Commons are concerned. page 45 It is the reverse of truth so far as the question relatos to the King. Heinous as has been the action of the Peers in trampling on the privileges of the Commons, their action has been much more heinous when it is regarded in its bearing upon the Sovereign. For by their vote rejecting the Budget 350 Peers of the Realm have refused Supplies to the King, a proceeding which has always been regarded as almost equivalent to a declaration of war upon the Sovereign, an act of rebellion against the Crown. If this be so, it is a grave question whether the 350 are not rebels and traitors, whose proper place is the Tower. Certainly some of their ancestors lost their heads for treason less heinous than this.