The people's budget - Geoffrey Lee

Although the Edwardian period may in retrospect appear to have been a golden age, it was in reality a time of much turbulence in the political and social fields. There were long and often violent strikes in the docks and coal mines as well as in other industries. Poverty was endemic, and it was the fear of the creation of a semi-criminal underclass as much as feelings of benevolence that led to the beginnings of the welfare state during this period. Lloyd George, then Chancellor of the Exchequer, needed to increase taxation to meet the cost of the recently introduced old-age pensions and, in his 1909 budget, he proposed his famously controversial land taxes. These were based on Henry George's philosophy as expounded in the economic bestseller, "Progress and Poverty", which had been published in 1879. His ideas had been incorporated in the Liberal Party's programme in 1891 by Gladstone. The House of Lords, set on defending the interests of its members, rejected the budget, in the process breaking an unwritten rule preventing it from opposing 'money bills'.In return the Government threatened to create enough Liberal Peers to outvote the Conservative majority. In the end the Peers backed down and the Parliament Act of 1911 established the supremacy of the elected chamber over the Lords, reducing their power to delay Bills and block budgets. The land taxes, badly drafted and never fully implemented because of the start of the First World War, were abolished in the 1920s. This book concludes by looking at the attempts and failure of subsequent governments to devise acceptable methods of separating the public from the private revenue of land to recoup for the community what the community itself creates. With the centenary of the People's Budget approaching, this revised edition of the book, originally published in 1996, is a timely reminder of the issues involved. The problems the great Liberal government of the first decade of the 20th century sought to solve by this reform of taxation remain to this day.