The session of 1863 was barren of important subjects of debate, and hence unusual interest was centered in the Chancellor's statement, which was another masterly financial presentation, and its leading propositions were cordially received. The whole reduction of taxation for the year was £3,340,000, or counting the total reductions, present and prospective, of £4,601,000. This still left a surplus of £400,000.
In four years £8,000,000 had been paid for war with China out of the ordinary revenues. A proposition to subject charities to the income tax, although endorsed by the whole cabinet, led to such powerful opposition throughout the country that it was finally withdrawn. The arguments of the Chancellor were endorsed by many who were opposed to the indiscriminate and mistaken beneficence which was so prevalent on death-beds.
A bill was introduced at this session by Sir Morton Peto, entitled the "Dissenters' Burial Bill," the object of which was to enable Nonconformists to have their own religious rites and services, and by their own ministers, in the graveyards of the Established Church. The bill was strongly opposed by Lord Robert Cecil and Mr. Disraeli. Mr. Gladstone favored the measure. The bill was rejected, and Mr. Gladstone at a later period discovered that his progress in ecclesiastical and political opinions was creating a breach between himself and his constituents at Oxford.
Mr. Gladstone's financial scheme for 1864 was received with undiminished interest. It was characterized as "a policy of which peace, progress and retrenchment were the watchwords." An available surplus of £2,260,000 enabled him to propose reductions.
The subject of reform, which had been coming up in the House of Commons in one way or another and agitating the House and the country since 1859, when the Conservative party was beaten on the question, reappeared in 1864. The question of lowering the borough franchise came up, and Mr. Gladstone startled the House and the country by his declaration upon the subject of reform, which showed the rapid development of his views upon the subject. The Conservative party was filled with alarm, and the hopes of the Reform party correspondingly elated. "The eyes of all Radical Reformers turned to Mr. Gladstone as the future Minister of Reform in Church and State. He became from the same moment an object of distrust, and something approaching to detestation in the eyes of all steady-going Conservatives."
Mr. Gladstone said: "I say that every man who is not presentably incapacitated by some consideration of personal unfitness or political danger, is morally entitled to come within the pale of the constitution." This declaration was the first note sounded in a conflict which, twelve months later, was to cost Mr. Gladstone his seat for Oxford University, and finally to culminate in the disruption of the Liberal Government. The general feeling in regard to this speech was that if the Liberal party had failed in its duty on the subject of reform in the existing Parliament after Mr. Gladstone's utterances, that the condition of things must undergo a change, so great was the effect of his speech in the country. The bill, which was presented by a private member and lost, was made memorable by the speech of the Chancellor. The eyes of careful political leaders were again turned towards Mr. Gladstone, and strong predictions made of his coming exaltation to the Premiership. Mr. Speaker Denison said, in October, 1864: "I now anticipate that Mr. Gladstone will be Premier. Neither party has any leader. I hope Mr. Gladstone may get support from the Conservatives who now support Palmerston." And these expectations were known to Mr. Gladstone himself, for Bishop Wilberforce had a conversation with him and writes: "Long talk with Gladstone as to Premiership: he is for acting under John Russell." Again to Mr. Gladstone: "Anything which breaks up, or tends to break up, Palmerston's supremacy, must bring you nearer to the post in which I long to see you, and, if I live, shall see you." Lord Palmerston himself said: "Gladstone will soon have it all his own way; and whenever he gets my place we shall have strange things."
The hostile feeling towards the Palmerston government, which had been growing in intensity, chiefly on the ground of its foreign policy, reached its full height in a fierce battle between the Ministry and the Opposition. July 4, 1864, Mr. Disraeli brought forward his motion of "no confidence." Mr. Gladstone replied for the government, and sought to rebut the accusations made by the leader of the Opposition. He said that it was the very first time in which the House of Commons had been called upon to record the degradation of the country, simply for the sake of displacing a ministry.
An amusing episode which occurred during this debate is worthy of record here; Mr. Bernard Osborne "grew amusingly sarcastic at the expense of the government, though he paid at the same time a great compliment to Mr. Gladstone. He likened the Cabinet to a museum of curiosities, in which there were some birds of rare and noble plumage, both alive and stuffed. There had been a difficulty, unfortunately, in keeping up the breed, and it was found necessary to cross it with the famous Peelites. 'I will do them the justice to say that they have a very great and noble Minister among them in the Chancellor of the Exchequer, and it is to his measures alone that they owe the little popularity and the little support they get from this Liberal party.' Describing Mr. Milner Gibson, the honorable gentleman said he was like some 'fly in amber,' and the wonder was 'how the devil he got there.' Mr. Cobden and Mr. Bright must have been disappointed in this 'young man from the country.' He had become insolent and almost quarrelsome under the guidance of the noble lord. Should that Parliament decide on terminating its own and their existence, they would find consolation that the funeral oration would be pronounced by Mr. Newdegate, and that some friendly hand would inscribe on their mausoleum, 'Rest and be thankful.'" Mr. Disraeli's motion was lost, and the ministry was sustained.
The budget of 1865 represented the country as in a prosperous financial condition. The total reduction was over £5,000,000. Such a financial showing gained the warm approval of the people, and excited but little opposition in the House. It was evident that a master-hand was guiding the national finances, and fortunately the Chancellor's calculations were verified by the continued prosperity of the country. At a later period, in commenting upon the policy of the two parties—Conservative and Liberal—Mr. Gladstone said: "From thence it follows that the policy of the Liberal party has been to reduce the public charges and to keep the expenditure within the estimates, and, as a result, to diminish the taxation of the country and the national debt; that the policy of the Tory government, since they took office in 1866, has been to increase the public charges, and to allow the departments to spend more than their estimates, and, as a result, to create deficits and to render the reduction of taxation impossible. Which policy will the country prefer?"