avenge her defeat and recover her lost provinces of Alsace and Lorraine, could not be suspected by the most excited imagination of an intention to attack us. Germany, Italy, and Russia too, now that the Black Sea question was settled, were animated by the most pacific sentiments towards us, and were neither singly nor collectively able to cope with our navy. 'The balance of power,' the cause or the pretext of so many wars, was tumbled in the dust. Nevertheless, the necessity for a firm attitude towards foreign powers, of holding dignified language, of maintaining a spirited policy,' had so completely gained hold of the public mind, that it was impossible even for a ministry as strong as Mr. Gladstone's then was to withstand the prevalent feeling, and the government so far yielded to it as to increase the army estimates from 12,965,000l., which they were in 1870, to 15,851,7007., being a difference of almost three millions. At the same time the militia was raised to its full strength, and the volunteer movement encouraged by an additional grant of 73,000l. The government was not sorry to avail itself of the prevailing excitement, in order to carry out a much-needed military reform, the first step in which must be the abolition of that system of purchase by means of which the longest purse could carry it over the most brilliant military genius. This question had been strongly agitated during the recess, and Mr. Trevelyan, M.P. for Hawick district, had distinguished himself by the zeal and assiduity with which he had advocated it, but it is probable that the government would not have grappled with an abuse so intertwined with the whole of our military system if the events which had occurred on the continent had not paved the way for it. To some it may seem strange and almost paradoxical to say that there could be much difficulty in abolishing a practice which every man out of the army condemned, and which scarcely any man in the army, not interested in its continuance, would justify. But the reader of this work will have had frequent occasion to remark that a small knot of persons, well organised and banded together to defend abuses, in the maintenance of which they are interested, will generally hold their ground, at least for a time, against the calm and dispassionate condemnation of the great body of the people. In this instance the system was defended as every time-honoured

1871.]

REORGANISATION OF THE ARMY.

401

absurdity before it had been defended. High authorities were cited in favour of it, the efficiency of the army was asserted to depend on it, and it was predicted that if it were abolished the glory of the British arms would have departed.

On Thursday, the 16th of February, Mr. Cardwell, with commendable promptitude, brought forward his plan. Though the chief object of his measure was the substitution of promotion by merit for promotion by purchase, it also provided for a thorough reorganisation of the army by combining the different forces of which it was composedthe regular army, the militia, the reserves, and the volunteers. The introduction of a bill which involved a largely increased military expenditure caused the army estimates to be discussed with unusual interest, excitement, and frequency. It now became evident that in order to carry their measure during the session, the government would be obliged to sacrifice their scheme of reorganisation and content themselves with effecting the abolition of purchase. And even after this had been done, Mr. Cardwell was obliged to remind the military men, who were the chief obstructors, that the over regulation prices paid for commissions were illegal, and to intimate to them that if their obstructive proceedings were carried further the law would be put in force. This hint had the desired effect; the bill made its way through the Commons and was passed by 289 votes to 231. Notwithstanding the largeness of this majority it was decided, at a meeting held at the Carlton Club, that the measure should be opposed in the House of Lords, and the Duke of Richmond moved a resolution to the effect that the House desired to see the whole of the government plan before dealing with the question of the abolition of purchase. In fact the duke required ministers to put back into the bill the provisions which the opposition of his friends in the lower House had compelled them to take out of it. Notwithstanding the manifest unreasonableness, not to say factiousness, of this proceeding, the duke's resolution was carried by a majority of 25. Had this vote been maintained the bill would have been lost for the session. The second reading was not absolutely refused, but a condition was imposed with which it would have been impossible to comply. The opponents of the bill were greatly jubilant, but their triumph was short-lived.

VOL. III.

D D

Two days after this victory was gained both Houses were crowded in all parts in expectation of an announcement of the course the government intended to take. It was generally expected that the action of the Lords would be firmly and resolutely met. Greatly to the delight of the supporters of the government and not less to the dismay of their opponents, Lord Granville in the upper House and Mr. Gladstone in the lower, pointed out that the success of the Duke of Richmond's motion did not necessitate the loss of the bill, but only its postponement, and that any peer might still move the second reading of it. They further stated that purchase being legalised not by statute, but by royal warrant, the government had advised the Queen to cancel the warrant, the consequence of which would be the abolition of purchase on the 1st of November. Seldom has the House of Commons rung with a more triumphant cheer than this announcement elicited. It placed the majority of the House of Lords in a very embarrassing dilemma. The chief object of the bill had been effected; purchase created by one exercise of the royal prerogative was destroyed by another, and the government measure thus became a bill for compensating officers for the losses they would sustain through that abolition of purchase which was now a fait accompli. Under these circumstances the Lords censured ministers by a majority of 80, and quietly passed the bill. If nothing more than this had been done during the session the government would have richly deserved the gratitude of the nation. It had stormed a stronghold of class interest, which, if not attacked by a powerful government, might have continued for many years to impair the efficiency of our army. But this was not the only measure of public interest and importance that they carried through during this session. The University Tests Bill, the nature and object of which are sufficiently described by its title, brought forward in 1870, was revived this year. Though it met with some opposition in the lower House from Messrs. Stevenson and Fawcett, who desired to make it more efficient, and in the upper House from Lord Salisbury, who proposed to substitute a new test for that which the bill abrogated, it was carried through both Houses without any important alteration. The Ecclesiastical Titles Bill put an end to the intolerant

1871.]

THE BUDGET.

403

provisions which had been introduced into the measures which the 'papal aggression' provoked. The Trade Union Act carried out the recommendations of the commission appointed to inquire into that important question, and aimed at putting an end to trades disputes by a system of impartial justice both to employers of labour and those employed by them. The Local Government Act extended to small towns and villages the administrative advantages which had hitherto been enjoyed only by those cities and boroughs that possessed municipal corporations.

The budget of this year, which had a somewhat curious history, was thus introduced by Mr. Lowe:

'I estimate the excess of expenditure over revenue at 2,713,000l. The house tax and some other sources of income will not be available after this year. The sum of 600,000l. taken this year for the abolition of purchase in the army will probably be doubled next year. What is to be done? There is no surplus revenue. The government will not increase the national debt. I can indeed show a way in which, without imposing fresh burdens, we could raise upwards of two millions-that is, by the abolition of exemptions of agricultural horses, licenses in Ireland, charitable and collegiate funds, and dividends belonging to foreigners residing abroad, making altogether 2,100,000l. But I do not propose to do this. Nor would it be wise to disturb the customs duties. But there is a tax which could be touched. I allude to the probate, legacy, and succession duties. The probate duty has many faults. It is charged on property bequeathed by will, but if a man dies intestate it is charged in the proportion of three to two. This law, I suppose, was made by lawyers, who thought it right to punish a man for going out of the world without making a will. I propose to abolish it. I propose to rate all personal property liable as intestate on a two per cent. duty. If an Englishman dies in France having property in England, his property would pay probate duty, but the legacies would not pay legacy duty; but if an Englishman had property in France he would pay legacy duty but not probate duty. I propose to sweep away these anomalies, and to enact that where a man pays probate duty he shall pay legacy duty, and where he pays legacy duty he shall pay probate duty. I now come to the succession duties. The son now pays one

per cent., a brother three per cent., the descendants of a grandfather five per cent., and persons of non-consanguinity ten per cent. I think it fair to propose an increase of the succession duties. When Mr. Gladstone imposed these duties he estimated that they would reach 2,000,000l. Lord Cairns thought it would be 4,000,000l., and Sir Richard Malins estimated it at 8,000,000l. This was eighteen years ago; but it only reached 750,0007. Therefore I think the duty will bear an increase both on real and personal property, and I propose to make the first lineal descendant pay two per cent. instead of one; I would raise brothers to three and a half; then for the next of kin, five, and the next ten per cent. This would give 1,200,000l., including the probate, succession, and legacy duties. The next tax I have to propose is one on lucifer matches. They are used in a most dangerous manner. Gentlemen who are directors in fire insurance companies will be glad of this tax. I propose to put a halfpenny stamp on every box of 1800 matches, a penny stamp on a box containing 100 wax lights, and a penny stamp on every box of 100 fusees. I expect to receive this year from the tax 550,000l. From the probate and legacy duties I only expect 300,000l., making altogether 850,000l. There will therefore still remain a deficiency of 1,950,000l. It is my intention to raise that sum by the income tax. I regret that I am obliged to do this, but the money must be had, and there is no other way in which it can be obtained with so little disturbance to trade. But

I

there is this difficulty. When the income tax was first imposed, a penny yielded 750,000l.; now a penny yields 1,550,000l., and there would still be a deficiency of 425,000l. propose therefore for the future to impose the income tax by a percentage. At present the tax is 4d. in the pound. This would be 17. 13s. 4d. in the 1007. If I add to that 10s. 8d., thus making it up to 27. 4s. Od. in the 1007., that would give me 2,800,000l. in addition to the sum already received. The effect of what I propose will be that the legacy, probate, and succession duties would yield this year an addition of 350,000l.; matches, 550,000l., and the additional income tax 1,800,000%.'

It would have been difficult to have framed any budget that would have occasioned more general dissatisfaction than that which was thus laid before the House of Commons.