Commons Sitting of 27 May 1808

LIFE ANNUITY PLAN.
On the motion of the Chancellor of the Exchequer, the house resolved itself into a committee on the resolutions of the committee respecting the transfer of 3 per cent, stock for Life Annuities.
Mr. Tierneysubmitted a variety of calculations, tending to shew the inefficacy and inutility of the measure. If ever there was a period, when a man would be disinclined to increase his income at the expence of his capital, it must be at that period when there was a tax upon income, and none upon capital. He objected to the plan particularly, because it interfered with the sinking fund, and with the faith of the country pledged in consequence of that measure; but he did not do so in the abstract; he objected to it because it was indirect infraction of that measure, without being calculated to produce any advantage to the country. He was against any interference with the sinking fund, unless it was to restore it to the state in which it stood previous to the year 1802. In that case the public would begin, in the next year, or in the year following, to feel the advantages of it; but by the present measure this alleviation of the public burthens must be protracted for a number of years. The act stipulated that the commissioners should, from time to time, from year to year, lay out large sums in the purchase of stock. It was no answer to those who had contracted on the faith of these annual purchases, and who might have done so with the view of a speedy sale, to say, 'there is no harm done, in the course of ten years perhaps things will be restored to their proper and ordinary course.' Having once adopted the present measure, it would be in vain to say that the sinking fund was intended to be held sacred; for in agreeing to this proposition the house practised one of the grossest infractions upon it. The right hon. gent, dwelt on the extravagant inducement which this measure held out to
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a man, probably 70 years of age, to leave his family and relatives destitute, seeing he could thus raise his own income in the proportion of 12 to 3, or instead of 100 l. could procure for his own life 400 l. per annum. If, therefore, the right hon. gent. was to carry through the measure, he hoped he would limit the age. But, on the whole, he submitted to the committee, that the present was a measure which ought not to be suddenly gone into.
The Chancellor of the Exchequerhad no expectation, that the progress of the measure proposed would be very rapid. The present was not a plan which he would have been inclined to propose, as affording resources for the service of the year; but he was convinced, from the information and applications he had already received on the subject, that it would be one of permanent advantage, and of which, though no question of revenue were connected with it, the advantages would be generally and satisfactorily felt. He was convinced there would be applications for liberty to avail themselves of this measure, from sources of which the right hon. gent. had at. present no idea. There were persons in the constant habit of taking annuities for themselves and others, to whom this measure would present the means of saving all the original expence of such a contract. Stript as the present measure, would be, of every expence of this kind, he was satisfied it would prove an object of public as well as of individual advantage. The right hon. gent, had not said any thing as to the morality of the measure, which was a strong objection to it on a former night; he should not, therefore, enter on this point, but should content himself with observing that there appeared to him to be nothing unusual, or inconsistent with political economy, in allowing persons the opportunity of providing for themselves in this manner. What were Friendly Societies? Were they calculated for the advantage either of the widow or of the children? They surely were not; but by them part of the income was laid aside for the benefit of the person himself, without any regard to his family. The right hon. gent. alluded to the proposal of sir George Saville, which, though not adopted by parliament, was still an authority in favour of such a measure. As to the idea of this being any infraction on the measure of the sinking fund, he admitted that it was so in manner and in words, but not at all

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in spirit. It would have the effect of taking out of the market a quantity of stock, and of substituting in the place of it what would, by no means, be so, marketable a commodity. It would, in fact, give additional effect to the two objects of the sinking fund. By the former operation, the amount of the dividend only would be taken out of the market; by the present measure, the amount of the capital itself would be taken out of it. Thus, not only the redemption of the debt would be secured, but that object, would also be effected at an earlier period. Instead, therefore, of being an infraction on the sinking fund, it would add fresh vigour to it.
Lord H. Pettysaid, that the right hon. gent, admitted he expected no great immediate effect from the measure, but that it would be gradual. In this his lordship could hardly agree; for if he at all understood the plan, the right hon. gent, expected the funds to rise; and whenever they did rise to a certain height, the measure was to cease. His lordship thought the plan altogether objectionable, in a political, moral, and financial point of view. He asked, would it be proper, or rather would it not be dangerous in the extreme, if the great bulk of the property of this country were allowed to be thrown into annuities? The right hon. gent. had referred to the case of benefit societies as one in his favour. If he (lord H. Petty), however, had been to select a case on the other side, he did not think he could have hit on one more completely in favour of his argument. In the case of benefit societies, part of the income of a week was converted into a fund for the support of the person during life; thus, a temporary was converted into a more permanent fund. But by the present measure, the permanent was to be converted into the temporary fund. His lordship was decidedly of opinion, that this measure would be prejudicial not to those alone who were induced to try its effect, but also to the public creditor. The right hon. gent, surely did not mean to state that these annuities would not be transferred, and of course would, in a different shape, bring the same quantity of stock again into the market? Did he mean to contend that it might not happen, that, from the casualties of human life, a person who had purchased an annuity might not he obliged to sell it again? Thus, though government might be ready to grant to persons wish-
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ing to purchase annuities for their own lives, which must at all times be preferable to those on the lives of others, yet persons would often be found, compelled by some pressure, to sell their annuities to a disadvantage, and purchasers would also be found, tempted by the desire of a profitable bargain.
Mr. Huskissonstated, that with respect to the noble lord's plan, it would not be interfered with by this measure, because certainly the Sinking Fund would in ten years be in as good a situation, notwithstanding the operation of this plan, as under that of the noble lord. This plan was not to hold out an inducement, but to afford an opportunity to persons wishing to purchase annuities, to invest their capital in that manner; and it would undoubtedly be a great convenience to many individuals, who might have to bequeath annuities to dependants, to have their lands discharged of such annuities by purchases under the present plan. The hon. gent, then shewed by calculations, that the operation of this plan would accelerate the period of the redemption of the public debt, without producing the inequality in the effect of the sinking fund apprehended by the noble lord.
Mr. Davies Giddythought that the plan now proposed would have the effect of encouraging a greater degree of frugality in the lower classes, by affording them an opportunity of applying their savings, with perfect security, to the increase of their incomes, and that in this point of view the benefit would overbalance any evil which might arise from it.
Mr. Biddulphdid not think there would be any sound objection to the adoption of this plan; on the contrary, he was friendly to its adoption, because in a free country like this there should be as great a diversity as possible of option afforded to persons wishing to lay out their capital with security; and to show that he was friendly to the adoption, he proposed that the annuities should be rendered more marketable by facilitating the insurance of the lives of the nominees, by taking off the tax upon the policies of insurance upon such lives.—The Resolutions were then agreed to.

BANK OF IRELAND.
The house went into a committee of ways and means; in which,
Mr. Foster,after detailing the history and progress of the Bank of Ireland, stated, that it was proposed that the bank capital

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should be increased from one million and I a half to two millions and a half; the interest en the additional million to be the same as on the present capital; a million and a quarter to be advanced to government for the period of the charter, unless government should upon certain notice think proper to repay it sooner. The Irish bank was also to manage the whole debt of Ireland, free of further expence, whatever addition may be made to it. He therefore moved, That it be the opinion of the committee, that the governor and company of the Bank of Ireland be continued as a corporation till the 1st of Jan. 1837.
Mr. Tierneyobjected to the resolution, on the ground that he disapproved of the principle of borrowing money from the bank whilst the restriction of specie existed, and he thought this a bad money-bargain for the public.
Mr. Fosterreplied, that this million was to be raised by the bank proprietors or from subscribers, and would be bona fide an. increase of their renewal. The motive of the renewal of the charter was not with a view to any money bargain, but to secure the existence or the company, to discount at five per cent, for the public.
Mr. Parnellobjected to the renewal of the charter, because it would remove the transactions of the bank out of the controul of parliament.
Mr. Bankesstated, that the committee whose report he had had the honour to submit to the house, were of opinion that the benefit to be attached to the paper of the national banks of England and Ireland, by its exclusive credit, was not expedient to be continued longer than the exigency of the times required. It was net fit that the hands of the legislature should be tied up, whether the circumstances of the country-were so materially changed as to throw an additional benefit into the hands of the bank or not. He thought that ten, or at most fifteen, years addition, was sufficient to be granted at present.
Mr. M. Fitzgerald,in order to give some idea of the benefit that was to be derived from an accredited issue of paper, stated that one banking-house in Ireland set up on the price of a captain's commission in the dragoons, and that they afterwards had afloating capital to the amount of 490,000 l. Besides, he did not think that the bank of Ireland was entitled to much favour from the legislature, as at the time of the invasion at Bantry-bay, under general Hoche, they refused to advance money to govern-
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ment, and it was by the money of a loyal individual that the army was put hi motion.
The Chancellor of the Exchequermaintained that the liberality and loyalty of the bank of Ireland had not any the smallest reason to be called in question. The addition was only one million Irish currency; and the security which it gave to individuals, and the benefit to the public by the gratuitous management of its debt, were ample reasons for the renewal of its charter.—The Resolutions were then agreed to.

SUGAR-DISTILLATION.
On the motion of lord Binning, the report of the committee respecting the use of Sugar in Distilleries was brought up; and the house resolved into a committee for the recommitment of the two first Resolutions. On the first Resolution being read,
Mr. Cokerepeated his former objections to the measure, and contended that the apprehension of scarcity was unfounded, and had arisen from the conduct of the West Indian merchants, and the discussion of this subject. He denied that the last harvest was short, and stated as a proof of that, that the price of corn was not higher than was necessary to afford a fair profit to the farmer. He contended, that if this measure were to be continued for only two years, there would not be produced the same quantity of bread corn; that the right hon. gent, would be responsible for all the consequences, and would be the first minister to prevent by his measures the poor from being able to procure bread. He should therefore object to the measure in every stage.
Mr. Hibbertcontended, that it was neither the growers of corn, nor the growers of sugar, that were particularly concerned, in this question. The consumers of corn, the manufacturers, and all who wished well to the country, were the persons most concerned; and as the supply which the country had from importation for some years past was now stopped, it was the more necessary to take measures to provide for making up that supply. The agriculture of the country was not adequate to make up for that deficiency, and therefore there could be no reasonable objection to the introduction of some part of it from the West Indies.
Sir James Hallsaid, that great part of what he had to offer on this subject had been anticipated by gentlemen who had already spoken upon it and in particular, by the chancellor of the exchequer foe Ire-

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land, who had delivered doctrines truly refreshing to hear from the bench upon which he sat.—It had been urged by the noble lord who brought forward the measure, that no danger could arise from it, as a precedent. But, in his opinion, it was thus, and thus only, dangerous. As a temporary measure, it was nugatory, and would neither serve the West-Indians nor hurt the farmers at home; for the distillers, in contemplation of the stoppage now proposed, had been of late urging their business with unexampled activity, and were doubly stocked with spirits from grain, which the people of this country are known to prefer; so that there can now be no inducement to add to the quantity of spirits already produced; and the permission to distil from sugar will remain a dead letter, during all the time of its proposed duration; and of course, as a temporary measure, then it will neither do good nor harm.—But that, as a precedent, the measure was highly pernicious, by holding out to the West-Indians the expectation of a similar encouragement in future, and thus inducing them to continue their over-production of sugar: That those gentlemen who had voted for this measure as temporary, whilst they professed their disapprobation of it, if permanent, must either in future act contrary to their conviction of what is right, or will have done a great injury to those whom they intend to serve; since their present vote must tend to encourage that very production, which they are bound, by their present professions, to check on a future occasion: That the whole tendency of the measure is to bestow upon the production of an article of mere luxury, that encouragement which has hitherto been given to the growth of the food of man.
Mr. W. Smithwas extremely sorry to differ upon this subject from the hon. gent, who began this discussion, with whom he was very much in the habit of agreeing. No man could doubt the existence of partial scarcity. He had documents, received earlier than the discussion of the question, to prove that fact, and which from their strength he did not think proper to read. These accounts he had received from parts of Scotland with which he was connected. The late crop of barley was short, and though there was no scarcity of wheat, there was a scarcity of barley, and an universal scarcity of oats in the country; as might be collected from the price of oats in the market, which was now
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49 s. and 50 s. He therefore did not object to the resolution before the committee because it went too far, but because it was not likely to produce the good effects that were proposed from its adoption; because, by resorting to the measure at the present time, not a single quarter of corn would be saved for consumption; but some, on the contrary, taken from the consumption, so far as the corn of the present year was concerned. On this ground, he should, if no other gentleman did, move an alteration of the resolution to make it commence much earlier in its operation. He also objected to that part of the resolution which would impose upon ministers the necessity of a positive measure, which might excite alarm in the country, by extending the prohibition after the 1st Oct. if the harvest should not be abundant. He should prefer extending the prohibition to the 1st of Jan. 1st of March, or even the 1st of July, next year, if necessary, leaving to ministers, if the next crop should be abundant, to open the distilleries by proclamation, an act which would give the country universal satisfaction. He would, therefore, give to the West Indians this temporary relief, but he would not give to them the slightest hopes of its being repeated, because he would not suffer the agricultural interests of the country to be permanently invaded. The hon. gent, concluded by moving as an amendment, That the 10th of June should be substituted for the 1st of July as the period when the prohibition of the use of corn in the distilleries should commence. On the question being put,
Mr. Yorkecondemned the interference of parliament with the agriculture of the country. Great Britain and Ireland must be able to produce sufficient for their consumption, if their agriculture was not to be interfered with by impolitic measures of this description. The shutting of the ports of the continent against us would amount to a bounty on the improvement and extension of agriculture, not only with respect to corn, but the cultivation of hemp. This measure he considered as a dangerous experiment, and agreed with the hon. gent, who spoke last, that no hope should be held out to the West India merchants that this measure should ever again be resorted to. He did not see why a certain sum might not be lent to the West Indies upon adequate security, to enable the proprietors to turn their lands to the production of other articles. He would even

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prefer, rather than break in upon a grand principle, to grant a sum of money to his majesty to enable him. to purchase a quantity of the redundant sugar, for the relief of the West Indian merchants.
Mr. Davies Giddyconsidered it of the highest importance to encourage the agriculture by exportation, consumption in breweries and distilleries, and in every possible mode. He was, however, of opinion, that in times of necessity the legislature had a right to interfere and prevent every other consumption of corn, in order to save it for human food; but whilst he admitted this right, he contended as strongly, that nothing would so legitimately give that right as the deficiency of human food. The reason why he thought that agriculture ought to be encouraged, was because nothing could make a country so truly great as to render it independent, for articles of necessity, of any other nation. He should never, therefore, consent to any interference with the agriculture of the country for any object of external interest.
Mr. Barhamre-asserted and vindicated some of his former statements, respecting the motives of the opposition to this measure, and argued at considerable length in support of it.
Mr. Hawkins Browneargued that some means should be devised for taking oil some of the redundant stock of sugar. If the effect of the measure should be to injure the landed interest, no gentleman would consent to it; but the object of the measure was, to prevent the consequences of a scarcity if the next crop should not be a good one.
Sir John Sebrightcould not avoid entering his protest against this measure, and declared, that though he was one of the landed interest, he did not object to this measure on any narrow view, but from the opinion that it was fraught with injury to the agriculture of the country.
Mr. H. Lascellesrecalled the attention of the committee to the real question before them. The resolution under consideration, was, whether the use of corn in distilleries, from the 1st of July to the 1st of October should be prohibited. During that period the distilleries usually were stopped, so that no injury could be done thereby to the landed interest. He could not see why the measure should not be re sorted to, vesting in his majesty's minister a discretion as to the continuance of the prohibition; because they would be bourn
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to take into their consideration the nature of the harvest and the price of corn, and would be responsible for the exercise of that discretion.
Lord Binningagreed to the amendment made by his hon. friend.
Mr. Portmanenumerated the inconveniences that would be suffered by distillers, if the use of corn were to be prohibited in distilleries on the 1st of July, both in consequence of the corn they had on hand ground, and of the loss they would sustain from the cattle, which were now fed upon grains in warm houses, being exposed to the effect of the open air.
Mr. Whitbreadwished merely to state the ground of the vote which he meant to give. He should certainly support the amendment of his hon. friend, because he thought, that if any effect at all were to be expected from the measure, it must be by adopting that amendment. But as he was an enemy to the measure in any shape, he should feel himself bound to oppose the Resolution in chief.
Mr. Cokedeclared his intention to follow the example of his hon. friend, and to vote for the amendment, and against the Resolution.—The house then divided: For the Amendment 89; against it 71. Majority 18. After which, the period of the commencement of the prohibition was fixed for the 15th of June for Scotland, and the 20th for Ireland.