deputation desired was, that with respect to these bequests, hospitals, or others falling within the category of charities for the purposes of the income tax, it was their desire that Parliament should continue the present exemption from income tax of all kinds, and so make itself a partner in the wants at present, and maintenance in the future, of all such so-called charities.

The Duke of CAMBRIDGE said that, as far as he was authorized to speak, it was no doubt the wish of the deputation that the charities should be left as they were.

The CHANCELLOR of the EXCHEQUER said his only wish was to know whether the deputation wished that there should be a continuance simpliciter of the present exemption?

To this nearly all the deputation replied in the affirmative.
The deputation then withdrew.

On the evening of the same day the Chancellor of the Exchequer proceeded, in a Committee of the whole House, to explain and advocate the proposition he had made for making the funds of charitable endowments for the first time subject to the income tax. It was an undertaking of no ordinary difficulty, for Mr. Gladstone must have been well aware that he was confronting an adverse audience, and a prepossessed, if not pledged, majority. This circumstance, however, did not disarm his courage, but it inspired his speech with an impulsive vehemence and a passionate energy which rendered it one of the most striking displays of eloquence and power that have been heard of late years in the House of Commons. It would be impossible within our limits to afford the space required to do justice to this remarkable oration, which, although it failed, as was well foreseen, of its immediate object, produced. a marked impression upon the House. Mr. Gladstone began by observing that he declined to embarrass the Committee by entering into peculiar cases that might be argued on peculiar grounds. The question on the part of the Government was whether the law should be modified which extended to bequests to charitable uses an immunity from all direct taxation. He was not ignorant, he said, that considerable opposition to the proposal of the Government existed in the country. That proposal they considered a wise one, and, as regarded the great mass of charitable property, an equitable compromise. On the other hand, he admitted that it was a proposal which could not be carried without the free and deliberate sanction of that House. After a review of the aspect in which charitable foundations had been regarded by past Financial Ministers, and an examination of the nature and character of many of the bequests which were included in the category of charities, but which did not deserve the name, he considered the policy of offering a premium upon death-bed bequests, and viewed the encouragement of so-called acts of charity, by what was in effect a gift of money at the expense of the community, as wrong in policy and unjust in practice. He calculated that the exemption of charities from the income tax was a loss to the

The

Revenue of fully 250,000l. a year. This allowance to charities was virtually an expenditure kept out of view, and not under the control of Parliament, which was left as to this great expenditure entirely in the dark, and he asked why this promiscuous gift of a quarter of a million should be continued. charities, he observed, might be divided into three classes— small, middle, and great charities. As to the small charities, he asserted that hardly one of them, if they had asked the House for a grant of 58., would have received it. He described some of these charities, which he considered had no claim to any indulgence. The utmost they deserved was toleration, but not a penny from the public purse. Yet they formed not far short of one-half of the charities of the country, receiving, therefore, a gift at the expense of the tax-payer of 125,000l. a year. Mr. Gladstone then discussed the cases of the middle and the great charities, which included the large educational foundations and the hospitals, properly so called. He entered into details regarding Christ's Hospital, the Charterhouse, and King's College, belonging to the former class; and with respect to the latter he examined, for example, the particulars of the income and expenditure of St. Bartholomew's Hospital, showing that whereas the charge upon the hospital for income tax would be 8507. a year, the hospital had obtained a relief from taxation and an improvement in the value of its property that was a direct pecuniary benefit from the income tax to the extent of 33007. a year, showing a clear gain of 24501. a year.

Mr. Gladstone then proceeded to combat the assertion which had been freely made out of doors, that if the hospitals should be compelled to pay the income tax, it would compel them to close some of their wards, or to reduce their beds. He said, "It was not my intention to make any remarks on the management of hospitals of this kind, which we must all regard with so much. favour and respect; but when at every turn the threat is flung in my face that if this measure is carried out the number of patients must be diminished, then I am obliged to give it particular consideration. I do not believe that the band of patients will be reduced. Those who, in the case of the protected trades, declared that if protection were withdrawn they must dismiss so many of their workmen, were not men who told lies. They really believed what they said, but were not aware that more economical arrangements would enable them to keep their workmen, pursue their trade, and make larger profits than before. One of the great evils of the present system is, that while you bestow public money on these establishments, you dispense with all public control over them, and thus annul all effective motives for economy. Endowed institutions laugh at public opinion. The press knows nothing of their expenditure; Parliament knows nothing of it. It is too much to say that hospitals are managed by angels and archangels, and do not, like the rest of humanity, stand in need of supervision, criticism, and rebuke. Therefore, even in the case of St. Bartho

lomew's, I object to an exemption, which, by its very nature, at once removes the principal motives for economical management. When the managers tell me that the exaction of 8201. will compel them to dismiss 500 patients, I am entitled to ask, 'Why, then, do you spend 2207. in a feast? what right have you to eat up in an hour 150 beds?' I confess I am amazed at the skill with which my opponents have put their best foot foremost. Their tactics and strategy have been admirable; but their case will not bear close scrutiny. What are the circumstances of Guy's, of St. Thomas's, and similar establishments? Every year they are able to place out 30007. or 40007. each in reproductive investments in land. They are thinking not merely of the sick, but of their own future aggrandizement and extension. I was informed the other day that St. Thomas's spends 15 per cent. of its income in improvements on its land. Well, then, it is a matter for the State to consider, whether the indefinite enrichment of such corporations-even of those instituted for the best of purposes-when entirely removed from the control of public opinion, the press, or Parliament, is to go on without limit, and is to be augmented by contributions from the public purse. I do not believe that a single patient will be dismissed from one of the hospitals of London, if this proposal is agreed to; but if there were the slightest apprehension of such an occurrence, private charity would at once prevent it." He would, he said, prefer that the benefit conferred upon these hospitals should be given in the form of a public grant rather than as an exemption. But there were unendowed hospitals, and he put this question to the Committee:-"Let it be admitted, for the sake of argument, that Parliament ought to make a grant to hospitals for the relief of the sick poor, was it just that the grant should be confined to institutions with revenues of 25,000., 30,000l., or 35,000l. a year, instead of giving it to young and struggling institutions ?"

In conclusion, Mr. Gladstone repeated the grounds upon which the Government had felt it their duty to submit this proposition to the House, and the spirit in which they made it. Although I may have felt that it was on the present occasion my lot to address an adverse assembly, yet I have deemed it to be my duty as a Minister of the Crown not to shrink from the discharge of the obligation which was imposed upon me, to show that neither my colleagues nor myself took up this proposition lightly or without due consideration. I am convinced, moreover, that in inviting public attention to ground hitherto almost untrodden, this discussion will not be without its fruits. I have stated that it is only by a licence of speech that the name of charities can be extended to death-bed bequests, even when applied to useful purposes. I have stated that the growth of those charities is more rapid than the wealth of the country; that many of them have been declared on good authority to be indifferent, and many bad. I have shown that the plan of the Government would subject

the middle charities-which I admit to be generally good-to less than half taxation as compared with private property under certain circumstances, and that in the case even of the smaller charities, if they had any claim for a public grant, it was monstrous to make such a grant by way of an exemption, which selects for favour institutions which do not want, and leaves to struggle those which stand most in need of assistance. The proposition which I have made we do not submit to the House as a matter of financial necessity; we offer it to your notice as a just measure. I will say nothing now of the hard words which have been applied to it; but of this I am sure, that no one would have given to it a more cordial or conscientious support than he' who so lately sat upon this bench, and whose loss we so deeply lament

'Justissimus unus,

Qui fuit in Teucris et servantissimus æqui.'

We do not

We propose this, then, as a measure of justice. presume to press it upon an adverse House, which must be responsible for its rejection. We desire to defer to the opinion of the House. We do not wish to show any undue obduracy. We will reserve to ourselves the right to consider in what way the subject ought hereafter to be dealt with, if the House should not now wish to accept this proposal at our hands. But we at the same time urge its adoption on the House as a measure sound in principle-as a measure in conformity with the spirit which has guided the proceedings of Parliament for the last twenty yearsas a measure just to the tax-paying community, and, above all, the labouring poor, to elevate whose character and to improve whose condition is one of the main objects of legislative action. In proposing such a measure we feel ourselves to be impregnable against all petty arts and reproaches, and we commend it with confidence to the justice, the equity, the courage, and the wisdom of the House of Commons."

The proposition of the Chancellor of the Exchequer met with warm and vigorous opposition from the Conservative side of the House, while on the Liberal side it found no support among the independent members. The sense of the House was evidently against it. The principal speakers in opposition were Sir Stafford Northcote, Mr. Disraeli, and Lord Robert Cecil. They controverted the principle on which Mr. Gladstone at the outset had founded his argument, that an exemption from a general tax conferred upon any party is equivalent to a grant from the State of the amount remitted, and is consequently made at the expense of the other persons who pay the tax. To tax the endowments of the almshouse or the hospital was, in effect, they said, to tax the recipients of the benefits of those institutions,-needy and distressed persons, who had the same claim to exemption which the

law at present conceded to all persons having less than 1007. a year. The income tax was a tax not upon property but upon persons, and it was inconsistent to make those persons who were the beneficiaries of charities liable to the charge from which other persons having incomes below the taxable amount were exempted. Since the income tax was first imposed by Mr. Pitt, and afterwards when it was revived by Sir R. Peel, the claim of eleemosynary endowments to exemption had been admitted, and those statesmen had only acted in accordance with the general feeling and conviction of the public.

The opinion of the country, it was further argued, was distinctly against the measure, and the attempt to enforce it would excite the utmost repugnance throughout the community. In its practical operation it would be attended with deplorable effects; it would compel hospitals to reduce the number of their inmates; it would cripple the resources of schools, and would cut down the pittance allowed to the indigent, the aged, and the infirm. The present time, when other charities were actually experiencing a loss of funds in consequence of the urgent demand of the Lancashire distress, was peculiarly inopportune for such an inroad upon their resources. Mr. Gladstone had indulged in vehement invectives against the deceased donors from whose bequests the existing endowments had been derived. Such attacks upon the motives of men, who, acting according to the light they had, had designed these institutions for the benefit of succeeding generations, were invidious and ill-timed. But be this as it might, Parliament had nothing whatever to do with the motives of donors or testators; they had to defend not the dead but the living, not to regulate the motives by which men might dispose of their property, but to protect the interests of the miserable, diseased, or destitute poor, whom they, from whatever motive, had by their donations relieved. Heavy charges of abuse and malversation had been laid against some of these institutions: it was said that they had corrupted and demoralized the districts where the funds were applied, and that endowments originally destined for the industrious and deserving had been perverted to support the idle, the dissolute, and the dishonest. But even granting this, what correspondence or proportion was there between the proposed measure and the alleged evil? What," asked Mr. Disraeli, "is the remedy of the Chancellor of the Exchequer for all those evils-for all that vicious principle which is the foundation of the endowments of England, for all that mismanagement, for all that impolitic state of affairs which he denounces with so much power? What is his remedy for the enormous imperfections in the old bequests-for the evils in those petty charities which he has called forth from their obscure existence-for the abuses connected with those magnificent foundations of hospitals and colleges which have contributed so much to the promotion of education and the development of benevolence in this country? Why, it is the applica