Prior to 1905 the Conservative domination of the House of Lords caused no problems, however once the Liberals had a majority in the Commons, the Lords could use their power to wreck their opponents legislation. After the Liberal Landslide of 1906, the Conservatives were powerless in the commons, with less than a quarter of the seats, but the Conservative leaders, Balfour and Lord Lansdowne decided to use the permanent Conservative majority in the Lords to block the policies of the new Liberal government. Balfour was of the opinion that “the great unionist party should still control whether in government or opposition”. In 1906, the Liberals’ Education Bill was so mutilated by the Lords that it had to be abandoned. Other Liberal measures blocked by the Lords were a Scottish Land Bill, the Abolition of Plural Voting Bill and the Licensing Bill of 1908.
But the Conservatives had other motives for rejecting the budget of 1909. The new land taxes were highly controversial, especially amongst rich conservative supporters. The first of these taxes was of the ‘unearned increment of land value’. This was an increase in value that was not the result of improvement by the landowner but the result of greater demand for land. It was a tax on the profits made by capitalists and speculators by the mere possession of land. It put a duty of 20% on the unearned increase in land value when it changed hands by sale or inheritance. The second was a duty of 1/2d in the pound on the value of undeveloped land and minerals. This was designed to hit those who held back their land from development in the hope of greater profits in the future. The Conservative party hated nothing more than the prospect of being taxed even more on their wealth. A Budget Protest League was set up and denounced the taxes as confiscation and robbery.
Conservatives argued that this was no ordinary Budget because it amounted to a social revolution. Opponents of the budget were worried by the prospect of redistributive taxation (taxation which takes money from the relatively rich and gives to the poor) and they were also weary of progressive taxation, which would take larger proportions of high incomes than of low incomes. They feared that once these principles were established they could be intended to ‘soak the rich’ and even out the very unfair distribution of income in Britain.
The Conservatives seemed very much against any legalisation or new taxation that would take any of the incomes of the wealthy and give it to the poor, who in actual fact were to thank for making Britain rich its middle class wealthy. As the Liberals were trying to introduce Social Reforms to improve the welfare of the state and introduce a ‘minimum standard of living’ it seemed the Conservatives were unwilling to compromise on any budget which meant the rich becoming any less rich. The Conservatives suggested that there were other ways to raise the money, such as tariffs on foreign imports, and that it was the duty of the House of Lords to restrain governments from making sweeping changes that the electorate had not voted on.
Conservatives also felt that the people had got themselves into the situations they were in and the state shouldn’t have to bail them out. They also argued that once Social Reforms were brought in the people would rely too heavily on the state and any welfare it offered, eventually they would become totally dependant and the nation would suffer greatly. However the Conservatives failed to notice that without the working class people of Britain the wealth of the state would be significantly less.
In conclusion, I feel that the main reason the House of Lords rejected the 1909 budget was because the Conservatives were unwilling to co-operate with an opposition government, and were more interested in making sure the Liberals could not pass everything they wanted to and thus make it appear to the people of Britain that the Liberal Party were not doing what they had promised to. I am also of the opinion that the Conservative party were weary that the Liberal reforms were going to mean higher taxations and more money for the poverty struck people of Britain, whom many conservatives believed shouldn’t rely on the state to get them out of their own problems.
Dom Ansell
L6P
