Editing H. H. Asquith (section)

====1909: People's Budget====
[[File:Meeting of Asquith cabinet19090001.jpg|thumb|left|This 1909 ''Punch'' cartoon suggests the Liberals were delighted when the Lords forced an election. Back row: Haldane, Churchill with arms up, being hugged by his ally Lloyd George. Asquith standing at right. Bottom row: McKenna, Lord Crewe (with moustache), Augustine Birrell leaning back]]

In a major speech in December 1908, Asquith announced that the upcoming budget would reflect the Liberals' policy agenda, and the [[People's Budget]] that was submitted to Parliament by Lloyd George the following year greatly expanded [[social welfare]] programmes. To pay for them, it significantly increased both [[Direct tax|direct]] and [[Indirect tax|indirect]] taxes.<ref name="dnb"/> These included a 20 per cent tax on the unearned increase in value in land, payable at death of the owner or sale of the land. There would also be a tax of {{frac|1|2}}d in the pound{{efn|That is, half a penny in a pound at a time (until 1971) when the pound sterling was made up of 240 pence, thus the tax was {{frac|1|480}} of the land's value, annually.}} on undeveloped land. A graduated [[income tax]] was imposed, and there were increases in imposts on tobacco, beer and spirits.{{sfn|Spender & Asquith|pp=254–255}} A tax on petrol was introduced despite Treasury concerns that it could not work in practice. Although Asquith held fourteen cabinet meetings to assure unity amongst his ministers,<ref name="dnb"/> there was opposition from some Liberals; Rosebery described the budget as "inquisitorial, tyrannical, and Socialistic".{{sfn|Jenkins|p=199}}

The budget divided the country and provoked bitter debate through the summer of 1909.{{sfn|Jenkins|pp=198–199}} The [[Alfred Harmsworth, 1st Viscount Northcliffe|Northcliffe]] Press (''[[The Times]]'' and the ''[[Daily Mail]]'') urged rejection of the budget to give tariff reform (indirect taxes on imported goods which, it was felt, would encourage British industry and trade within the Empire) a chance; there were many public meetings, some of them organised by [[duke]]s, in protest at the budget.{{sfn|Magnus 1964|pp=232, 527}} Many Liberal politicians attacked the peers, including Lloyd George in his [[Newcastle upon Tyne]] speech, in which he said "a fully-equipped duke costs as much to keep up as two [[Dreadnought]]s; and dukes are just as great a terror and they last longer".<ref>{{cite book|last1=Lloyd George|first1=David|author-link1=David|editor=Guedalla, Philip|editor-link=Philip Guedalla|title=Slings and Arrows – Sayings Chosen from the Speeches of the Rt Hon David Lloyd George, OM, MP|year=1929|publisher=Cassell and Company, Ltd|location=London|page = 111|chapter = Budget: Newcastle Speech}}</ref> King Edward privately urged Conservative leaders Balfour and [[Henry Petty-Fitzmaurice, 5th Marquess of Lansdowne|Lord Lansdowne]] to pass the Budget (this was not unusual, as [[Queen Victoria]] had helped to broker agreement between the two Houses over the [[Irish Church Act 1869]] and the [[Representation of the People Act 1884|Third Reform Act in 1884]]).{{sfn|Heffer|pp=281–282}}

From July it became increasingly clear that the Conservative peers would reject the budget, partly in the hope of forcing an election.{{sfn|Magnus 1964|p=534}} If they rejected it, Asquith determined, he would have to ask the King to dissolve Parliament, four years into a seven-year term,<ref name="dnb"/> as it would mean the legislature had refused [[Confidence and supply|supply]].{{efn|Asquith had to apologise to the King's adviser [[Lord Knollys]] for a Churchill speech calling for a Dissolution and rebuked Churchill at a Cabinet Meeting (21 July 1909) telling him to keep out of "matters of high policy", as the monarch's permission was needed to dissolve Parliament prematurely. See {{harvnb|Magnus 1964|p=527}}}} The budget passed the Commons on 4 November 1909, but was voted down in the Lords on the 30th, the Lords passing a resolution by Lord Lansdowne stating that they were entitled to oppose the finance bill as it lacked an electoral mandate.{{sfn|Heffer|pp=283–284}} Asquith had Parliament [[Legislative session#United Kingdom|prorogued]] three days later for an election beginning on 15 January 1910, with the Commons first passing a resolution deeming the Lords' vote to be an attack on the constitution.{{sfn|Koss|pp=116–117}}