THE EXCHEQUER GRANTS. SINCE 1860 the relation of local to national taxation has been a question acknowledged as deserving thorough treatment by Parliament, by which I mean, in this connection, the House of Commons. Governments meantime have come and gone, but the contributions by the Exchequer in aid of local burdens, while very different from those of that day, are even more unsatisfactory as a whole. I am not unaware, of course, of Mr. (afterwards Lord) Goschen's treatment of the subject in 1888, and the patches, large and ugly, laid since then on his somewhat questionable garment. His contribution is a failure because the question as a whole was not solved, viz., what is to be the relation of national to local taxation, if any. A slight study of our administrative institutions makes it quite clear that in plan the central and the local authorities are supposed to be, not independent of one another, but separate; and in regard to finance to be quite self-supporting. The first question in regard to Exchequer grants is this-shall we aim at preserving the separation of local from national authority, with the corollary of separate financial assessment and control, or shall we, deliberately, adopt the French and other Continental methods of centralising government and making the cost of government at the centre and in the localities only another fraction of the total burden of the self-same, identical list of contributing taxpayers? Our present practice is founded on a separation of the national and local powers, but it is of such a character as would be tolerated by no Government except that so expert at "muddling on" as our own British administration. Even among us evidence is plentiful that it is common opinion that Parliament should no longer defer a solution of this question-what shall be the relation of local to national finance? As it is announced that the present Administrative powers are of the same opinion, and propose to table a measure for the reform of local taxation, I should like to show what the Exchequer grants are at this moment, TABLE I-Payments TO LOCAL TAXATION ACCOUNTS, in the year ended March 31st, 1908, for England, Scotland, and Ireland. 1. Agricultural Grant (Scotland) Act, 1898 (61-2 Vict. c. 56; 1 Ed. VII. c. 13; 5 Ed. VII. c. 8) £ s. d. £ ... ... ... 2. Exchequer Contribution (Land Purchase Act, Ireland, 1891, 54-5 Vict. c. 48, sec. 5) 3. Agricultural Grant (Local Government Act, Ireland, 1898, 61-2 Vict. Payments under Finance Act, 1907, sec. 17. I. CUSTOMS. 7. Estate Duties-Under Finance Act, 1894, Relief of Rates generally ,, Agricultural Rates Acts, and consequential Acts... s. d. 98,034 18 8 ... ... ... 40,000 0 0 727,655 0 0 40,000 0 0 727,655 0 0 34 5 1 59 16 11 396 9 10 £8,559,342 8 9 £1,133,615 0 8 £1,462,422 27 £11,155,379 12 0 how they are made, and to discuss one or two issues which arise on a survey of the whole subject. Such a table requires several annotations, if only by way of a reminder of legislation on the subject. I have chosen the table of payments as at 1908 because it includes the licences which have since then been transferred for collection to the several local authorities concerned, together with £40,000 a year in lieu of the cost of their collection. There is also the important interference with the collection of revenue caused by the Finance Act, 1909-10, which make the figures for that fiscal year unsuitable for my present purpose, which is to show what grants local authorities receive under normal conditions. The agricultural grants of the first section of the table are equivalents for Scotland and Ireland of the Agricultural Rates Grants of 1896 for England and Wales, while the £40,000 to Ireland under the Purchase Act of 1891 is a sum to "grease the wheels" of purchase. Under the former it will be recollected that it was reckoned that these sums would cover the owner's portion of the local burdens, which were thereby transferred to the State. Of the second portion of the table-payments under the Finance Act, 1907-it should be recollected that Act directed that instead of intercepting the revenues specified in Mr. Goschen's Act of 1888, and other grants, on their way to the Treasury they should be paid into the Treasury, and an equivalent sum paid into the Local Taxation Accounts. These latter grants consist of the "whiskey money," being an extra 6d. a gallon on spirit, and an extra 3d. a barrel on beer, and the licences. are those specified in the Act of 1891, which are now collected by the various local authorities of counties and boroughs. The remaining grants are payable out of the proceeds of the estate duties, and are the equivalent of the duty on one and a half per cent. of the net capital value of the free personality upon which estate duty is payable, and on the same fund there was also laid the one-half of the rates on agricultural land by the Acts of 1896, for England, Scotland, and Ireland, the Irish portion being exchanged for a provision in the Act of 1898 (61 and 2, c. 37). The estate duty thus transferred in 1909-10 was £4,614,630. The table on p. 7 should be perused with care, for it does not pretend to include all the contributions of the central authority toward local burdens. That fact alone is one reason for the urgent need of attention to the question. For years the garment has been subject to patching: a new garment is much to be desired. Since the 'sixties of last century the House of Commons |