§ Sir G. Clerk moved, that a sum not exceeding 18,182,100l.. be granted for the payment of the Exchequer bills issued in 1842, and which yet remained unprovided for.
§ Mr. Humewished to know if the Chancellor of the Exchequer was prepared to state whether, in renewing these bills, he intended to make any alteration in the rate of interest of the bills for which this money was to be voted; and whether he intended to make any alteration in the 1136 rate of interest of the bills which were to be issued for the future.
§ The Chancellor of the Exchequersaid, that the present vote was to make good the exchange of Exchequer bills which had been voted during the course of the last Session of Parliament. Other bills would be provided for in a committee of ways and means, at a subsequent period of the Session, in the month of June. To undertake to say three months beforehand what the rate of interest would be in June, was a proceeding which no man, having charge of the financial concerns of the country, could possibly undertake. The interest of money three months hence might materially alter, and it must be left to the rate of interest at the time of the exchange to determine what the rate should be.
§ Mr. Humewished to know whether the right hon, Gentleman paid the same interest to the Bank of England for deficiency bills as he did to the public viz., 2d. on all bills.
§ The Chancellor of the Exchequersaid, that the interest on the Exchequer bills issued in June, was 2d and on those issued the day before yesterday l¾d.. The interest given to the Bank on deficiency bills was the same as that given to the public, it was 2d but when the new bills were issued no doubt the Bank would conform to the general rate.
§ Mr. William Williamssaid, that the statement of the right hon. Gentleman, that he had given interest at the rate of 2d. and expected to give it at the rate of 1¾d. to the Bank of England on the deficiency bills, astonished him. He had never known the same rate given except under great pressure. If the right hon. Gentleman sold the Exchequer bills to the public, he got money in exchange; whereas if he went to the Bank of England with deficiency bills, instead of obtaining money, as he did from the public, he got only notes, printed at a cost, as he (Mr. Williams) had once stated, of only l½d. for a 1,000l., and an hon. director had laughed at him for estimating the cost so high. He was sure that if the right hon. Gentleman had made a proper bargain with the Bank, he could have obtained any amount, in exchange for deficiency bills, at l¼d. a day, and he might have disposed of Exchequer bills to the public at the same rate. He would like that the right hon. Gentleman should show him how the 1137 public interest could suffer by lowering the rate of interest on those bills. It was not now, as it used to be, that Exchequer bills could be paid into the Exchequer for taxes; they could not be now so paid till they were due. Therefore, the public service would not suffer in the slightest degree by issuing Exchequer bills at a lower rate of interest. It was due to the public that this saving should be made, and he could not conceive why the right hon. Gentleman should give advantages to the money market which were quite uncalled for. Exchequer bills possessed a great advantage over funded property. The capital of Exchequer bills was at all times the same, whereas the amount of the funds was constantly varying. To-day they were at 97, and they had come down in 1825 and 1826 to 87. Exchequer bills on the contrary, were always paid in full. The reason why the interest on funded property was larger than on bills of exchange was, that the bills of exchange were of a certain amount: they paid the amount which they bore on the face, and were a full security. The right hon. Gentleman, however, had not answered the question he had put to him, namely, why he now proposed to issue Exchequer bills at this high rate of interest, when they bore in the market a premium equal to the interest for one and a quarter year. 1: was apparent that he was not making the bargain for the public which he ought.
§ The Chancellor of the Exchequerwould answer the hon. Gentleman by reference to his own argument. He had said, that in the Three per Cents. the interest which was now given would be a proper rate; because a person who embarked 100l. in those funds might lose a part of his capital by the depreciation of his capital; and then the hon. Member had gone on to say that Exchequer bills were now at a premium, being sold for 103l. 10s.. But did not the hon. Gentleman see that the value of Exchequer bills might also be depreciated by the diminution of the premium upon them, and that a party who held such securities might sustain loss, just in the same manner as a holder of stock in the Three per Cents. If a high rate of interest was necessary in one case, therefore, it must be admitted, though perhaps the argument was not equally strong in both cases, that it was requisite in the other. All that he could say was, that having considered this question most 1138 anxiously, he had made that reduction which in the present state of the credit of the country he had thought it fit to make, but that he did not think that he should have been justified in sanctioning an arrangement which would have caused any considerable alteration in the prices.
§ Mr. W. Williamshad no doubt that in the existing state of things the right hon. Gentleman could issue as many bills as were necessary at 1¼d. or l½s. at most, and that a saving of 150,000l might be effected, without any prospect of injury to the public credit.
§ Mr. Divettthought that the object of the right hon. Gentleman must be taken to be to preserve a uniform rate of interest. It was said that money could be had at a less rate than that which was now paid; but if the right hon. Gentleman were to attempt to deal with the market in the manner proposed, a variable rate of interest would be established, and inextricable confusion produced.
§ Dr. BowringThe question was whether, in the present state of the market, and with the increasing unwillingness of mercantile men and manufacturers to employ money in speculation or production, the time was not come when the interest ought to be reduced. It appeared to him, he confessed, that the Government might have reduced the rate of interest considerably below that at which it now stood.
§ Mr. Humethought that this was not a question upon which any doubt could exist, and he had been surprised that the hon. Member for Exeter should have exhibited so much ignorance on the subject. He believed that at the present time the amount of deposits in the Bank of England, exclusive of bullion, was from 8,000,000l. to 10,000,000l and this vast sum of money was waiting for employment. In the existing state of things, it was impossible to expect that commercial matters would revive; and with an amount of capital so large disengaged, he thought that the right hon. Gentleman paid too much interest. It was the duty of the Government to obtain their money in the cheapest market, especially considering the distress and the extraordinary taxation under which the country was labouring.
§ vote agreed to.
§ Sir George Clerk moved that the sum of 191,045l. be granted for the expenses of the commissariat department. He was 1139 happy to inform the committee that in this department a saving of 9,864l. had been effected, the vote of last year having been 200,919l.
§ Mr. Humewas glad to perceive that the expenses of this department were reduced, but he thought the diminution too small. He could not account for the large expenditure of money in the colonies; and unless our expenditure were largely diminished, the country would be placed in a serious position. The present expenditure was altogether unjustified; we were running riot in our poverty; and the only remedy to which he could look with any hopeful anticipations, was a finance committee to inquire into and check our expenditure.
§ Sir R. Peeldid not justify the estimates upon any ground of the flourishing condition of the country; nor did he think that the fact of such a state of things existing could justify an extravagant expenditure. He went further than the hon. Member, and affirmed that whatever were the condition of the finances, that could not justify keeping up a single man more than was wanted. It must, at the same time, be admitted that an establishment, such as this country was compelled to maintain, could not be always reduced concurrently with the existence of distress. The total amount of the military force of this country, exclusive of the army of the East Indies, was 95,000 men; but with this force rested the protection, not only of the British, but of our colonial empire. Our regular army in all our colonies, exclusive of India, was less by 10,000 men than that retained by France in Algeria alone. A military force must be maintained for the defence of colonies. Let them take the case of Australia, and of the other colonies added to our empire within the last thirty years, and let them compare the present amount of our force, and that which we maintained thirty years ago. The hon. Gentleman had alluded to the subject of a finance committee, but he did not see the advantage to be derived from an inquiry before such a body; and was of opinion that the governors of the various colonies must be better able to form a judgment of the necessity of maintaining military force than such a committee. The colonial committee of 1834 had been unable to suggest any reduction in our colonial establishments, and he thought that the same result would 1140 attend a like inquiry at the present time. Independently of other considerations, a certain amount of force was necessary to maintain the system of reliefs. The establishment of this year in other respects was not greater than was required. The hon. Gentleman the other day had suggested the immediate reduction of the naval and military forces of this country in China. He (Sir R. Peel) had said at that time that he did not feel justified in placing implicit reliance on the good faith of our new allies, and recent events had shown that it was wiser to incur a slight additional expenditure rather than run the risk of losing that advantage which had been gained by force of our arms.
§ Mr. Humesaid, that the right hon. Baronet was mistaken in the observation which he had last made, for in what he had said he had distinctly excepted China from the rule which he had endeavoured to lay down in other cases. The number of men employed in that part of the globe however, was only 3,102 out of the 45,000 men, devoted to our colonial possessions. He complained of the large forces uselessly maintained in the Mediterranean and in Canada; and he thought that the right hon. Baronet had admitted the weakness of his own argument when he had resorted to Algeria as a case in point.
§ Mr. F. T. Baringwas glad to see a reduction made in this vote, and made no objection to the amount. He thought that the maintenance of an efficient commissariat was highly necessary, for without such a body, there could be no check on the expenditure of our colonies. He approved of the method in which the present estimate was prepared, and expressed a hope that the estimates of the War-office would be similarly arranged.
§ Lord John Russellsaw no reason to offer any objection to the amount of force proposed to be taken for the ensuing year, nor to the expenditure of the year in this respect. Considering what had taken place, and the late termination of the war with China, he thought that the Government could not properly have asked for a smaller amount than that which was proposed.
§ Mr. W. Williamscomplained of the large amount of the army, which was 13,000 men more than it was in 1832.
Mr. Bernaldid not think the army too 1141 large, considering the important station this country held in the world, and our extended colonial possessions. Nor was it fair to charge those who supported the present establishments with being indifferent to the sufferings of the people.
§ Vote agreed to.
§ On the question that 47,945l. be granted for the half-pay and pensions of the commissariat department.
§ Sir G. Clerksaid, that the next vote which he had to propose was for the civil contingencies. As the papers relative to these estimates had only been distributed on Saturday, if it appeared to be the feeling of the House that sufficient time had not been given for the consideration of them, he would not press them. He would only state, that in preparing this vote he had endeavoured to carry into effect the wishes of hon. Members expressed last year. He had prepared, which was printed, an abstract, comparing the proposed expenditure of the present year with that under this head in former years. The vote which he had to propose was nearly the same in amount as that of last year. He should have previously observed, that he had removed from the vote for civil contingencies all those charges which were of regular occurrence. The vote last year was 130,000l.; the vote he had now to propose was 110,000l. This difference, however, did not arise from any material reduction in the vote for, in the first place, there was the sum of 10,000l. left unexpended last year, and there was the further amount of 10,000l. transferred to other heads of permanent expenditure.
§ Mr. Humesaid, though the explanation of the hon. Member was satisfactory, yet there were a number of items in the vote which before he had not an opportunity of seeing. The vote comprised between forty and fifty items, some of which he thought would require further explanation, and, therefore, all he desired was sufficient time to be prepared to ask for those explanations. He observed there was one item of 2,500l. for the preparations for the christening of the Prince of Wales, 600l. being for changing his Royal High-ness's Coat of Arms. There was, further, a charge for the consecration of the five colonial bishops, besides some expences incurred on account of the Bishop of Jerusalem. These required some explanation, and be would, therefore, move that 1142 the chairman report progress, and ask leave to sit again.
§ Sir R. Peelsaid, that when, on the occasion of a large sum of money being voted, any hon. Member stated bonâ fide he had not had an opportunity of looking into the items, he thought it was the duty of the Government to give way to the wishes of those hon. Members who, like the hon. Member for Montrose and the hon. Member for Coventry, devoted so much time to the examination of the public expenditure. He was unwilling unduly to press forward the estimates, though he regretted the hon. Member was not prepared to go on; but as the hon. Member stated he had not had a full opportunity of considering these items of expenditure— for they were not estimates—seeing that the House had already agreed on the propriety of the army, the navy, and the ordnance estimates—seeing that there was no disposition to a factious opposition—he would advise his hon. Friend to defer to the wishes of the hon. Member. But the hon. Member for Montrose had referred, among other items, to that for the christening of the Prince of Wales. With regard to that item, he hoped the committee would bear in mind that the expense had been incurred for a special and particular occasion, that a strong wish had been expressed by all classes that the christening should take place in one of the sacred edifices of the country, that the ceremonial was graced by the presence of his Majesty the King of Prussia; and he (Sir R. Peel) could only say that the civil list had borne a very large portion of this unforeseen expenditure, and therefore he trusted the committee would think that, in conformity with precedent, the other portion ought to be borne out of the civil contingencies. He would not enter into further details, but recommend his hon. Friend to take some other evening for these votes, which he was sure the more they were examined the more they would be found to be consistent with economy.
§ Mr. W. Williamswhile he admitted the perfect fairness with which the right hon. Baronet consented to postpone these votes, must say that the estimates already passed had been unduly hurried forward. Since he had had a seat in that House, he had never known the estimates brought forward and gone through at so early a period as in the present Session. With 1143 respect to these civil contingencies, he had so little expected them to come on this evening that he had not come prepared even with the papers.
§ Sir R. Peelhad already said, that if the hon. Member thought he could approach the consideration of these matters with more satisfaction to himself by a postponement, he would not press them. But the hon. Member complained of the haste in which the other estimates had been hurried forward. Now, he (Sir R. Peel) thought, that when the Government proposed perfectly reasonable estimates and took the House by surprise by the extent of their reductions—when, in fact, there was a general acquiescence in them, the hurry or haste in which they were got through did not arise from any precipitancy on the part of the Government, but from the universal consent to the Government propositions from both sides of the House.
§ Mr. Humesaid, so far from being contented with the reductions in the expenditure which had been made, he should have moved in many instances still further reductions; but seeing the support the right hon. Baronet had, he, for one, had given up the notion of fighting them.
§ House resumed. The committee to sit again.