HC Deb 19 June 1820 vol 1 cc1161-79

The House having resolved itself into a committee of Ways and Means,

The Chancellor of the Exchequer

rose. He stated, that feeling how difficult it was under the circumstances in which the House was then situated, for him to obtain that attention without which a financial discussion could not be intelligible or satisfactory, he should in the shortest, as well as the clearest, manner in his power state those particulars which it was his more immediate duty to bring under the consideration of parliament on that day, without attempting to enter into the discussion of general topics, which might he introduced with equal propriety on other occasions.

The first point to which he wished to call the attention of the committee, was the amount of the supply which had been granted for the service of the year under its several departments, and he should then proceed to show the funds from which the expenditure was intended to be defrayed, adding such explanations at the close of his statement as appeared to be necessary to elucidate the several points to which he had referred.

The first great head of expenditure to which he should call their attention, was that of the army. For military services there had been granted in the present year, including some items which still remained to be voted, the sum of 9,422,000l. In the preceding year the grant had amounted to 8,782,000l., but the actual expense had exceeded that sum, in con- sequence of the augmentation of force which had taken place towards the close of that year, and which had been partly included in the votes of the present session. Much as he might regret the causes which led to this augmentation of force, he should not then think it necessary to trouble the committee by entering upon them, being satisfied that the conviction was general in the country, as well as being sensible in his own mind, that the augmentation had not arisen from any voluntary disposition in the government to increase the military force, but from the urgent necessity of rinding additional protection for the loyal and industrious part of the population of the country.

He next adverted to the naval services, which amounted to 6,586,000l.; and under which head of expenditure there had also been an increase of 150,000l. arising principally from the same necessity which had produced the augmentation of the expences of the army, an additional number of 2,000 marines having been voted to perform garrison duty on shore.

The ordnance estimates amounted to 1,204,000l. being nearly the same as in the last year; and in both the actual expense considerably exceeded the sums granted by parliament, the surplus being made good by the sale of stores remaining at the close of the war, and which it was no longer necessary to preserve.

The miscellaneous services he should estimate at 2,100,000l. being about22,000l. more than in the year 1819; but in the estimate of the present year he included the sum which it had been supposed would be necessary for the expences of the coronation. The total amount of the heads of expenditure which he had enumerated was 19,313,000l. being about 825,000l. more than those of the last year; but this excess in the expense of the general service of the state would be in part compensated by a diminution of the charges of the unfunded debt, which, in 1819, had amounted to two millions, viz. 1,570,000l. for interest, and 430,000l. for sinking fund on exchequer bills. In the present year it was only necessary to provide one million for the interest, and 410,000l. for sinking fund. The total sum to be provided for the service of the year would therefore be 20,723,000l., while, in 1819, it had been 20,488,000l. But, in addition to the pension necessary to be made for the services properly belonging to the year, there was to be added a sum for the further reduction of unfunded debt. It had been recommended by the committees of both Houses of Parliament, that the sums due by government to the Bank should be diminished by a repayment of 10,000,000l. of which 5,000,000l. having been provided for in the last year, there remained a sum of 5,000,000l. now to provide. It also appeared to be necessary, in order to remove the pressure of unfunded debt upon the market to provide for a further reduction of the exchequer bills in the lands of individuals to the extent of 4,000,000l. making in the whole a diminution of unfunded debt to the amount of 9,000,000l., which, added to the provision for the services of the year, would make a total of supply to the extent of 29,723,000l.

To meet these charges, the first article of Ways and Means was the continuation of the usual annual taxes, amounting to 3,000,000l. The next would be a grant upon the produce of the temporary excise duties which had been continued since the war. In the year 1819, 3,500,000l. had been granted upon those duties, being about equal to their actual produce in the then preceding years; but owing principally to the variations of payment which had been caused by the consolidation of the excise duties, in July last, there remained on the 5th July, 1820, a sum of 900,000l., still to be made good upon that grant. He should, therefore, for the present year, propose to vote only 2,500,000l. upon that fund, in order that the grant might be nearly completed before the month of April next. The remaining articles of ordinary income were the lottery and the old naval stores. The former he should estimate at 240,000l. and the latter at 260,000l., being the produce of the sales of the last year. The total amount of these several items of ordinary income was six millions, which being deducted from the supply he had before stated, would leave the sum of 20,700,000l. to be provided for by extraordinary means.

He had already had occasion to explain to parliament the mode in which seven millions of exchequer bills had been funded, and a loan of five millions contracted, and he had had the satisfaction to observe that the terms which he had obtained for the public in each of those transactions had met with the general approbation of the House. He should now further propose a vote sanctioning a loan of 12,000,000l. from the sinking fund, making in the whole an amount of Ways and Means of 30,000,000l. and exceeding the supply granted by between two and three hundred thousand pounds. There remained a small article of income which it would be necessary to vote, but of which he could not offer a specific estimate. It would arise from the repayments which might take place of advances made to corporations or individuals under the authority of the act of the 57th of his late majesty, for affording encouragement to public works. Under that act, about 1,000,000l. had been advanced in exchequer bills, which would become due in October next, and for the payment of which parliament had made provision in the present session; but the individuals who had received these loans were in many instances allowed to repay them by distant instalments, so that only a small proportion of the sums advanced could be expected to be repaid in the present year; the whole transaction would, however, be ultimately wound up without any loss to the public, and at a rate of interest, which would afford provision for all the charges attending the operation of the act.

Having thus stated the various items of Supply and Ways and Means, it might be necessary to explain the situation of the unfunded debt, as settled by the votes of the last year, and as now proposed to be reduced by the arrangements for the present. The amount of exchequer bills, authorized to be issued by the acts of 1819, was 36,500,000l., to which was to be added the sum of 1,000,000l. issued, as he had before observed, under the 57th of the late king, and also 2,000,000l., of Irish Treasury bills, the value of which the Bank of Ireland had advanced to government. He should propose for the present year to grant 29,000,000l. of exchequer bills, and 1,500,000 of Irish Treasury bills, making together 30,500,000l. and making a diminution of the unfunded debt compared with the last year, as he had before stated, of 9,000,000l. The exchequer bills he should propose to vote this evening, but to reserve the Irish treasury bills for a future occasion, as he was not certain whether the Bank of Ireland, which had already exchanged 500,000l. of the Irish treasury bills, held by them for English exchequer bills, might not be desirous of exchanging a further sum in the same manner.

The terms of the sinking fund loan he should propose to regulate by those of the contract which had been entered into for the loan of 5,000,000l. it appearing to be the most equitable principle, that the sum of public money borrowed from the commissioners of the sinking fund should be taken at the same rate of interest as that at which the money of individuals had been advanced. The payments of this loan would be so arranged as to leave the sum of 5,000,000l. applicable by the commissioners to the purchase of stock in the year ended the 5th July, 1821. In the year ended 5th July, 1819, the sum applied by the commissioners had amounted to about 4,400,000l., including about 600,000l. applied in Ireland. In the present year, the total sum would be some what more than, 5,000,000l., of which between, 600,000l. and 700,000l. would also be applied in Ireland, leaving about 4,400,000l. for purchasers in England; and here it might be proper for him to answer a question, which had been more than once put to him by the hon. member for Penryn, viz. why, as the sinking fund now amounted to 17,000,000l. and would therefore have been sufficient, in addition to the proposed loan of twelve millions, the remaining sum of five millions had not also been borrowed from the sinking fund, so as to leave no sum to be borrowed from individuals. To this he should answer, that although the amount of debt remaining unredeemed at the close of the year might have been nearly the same in one mode of proceeding as in the other, yet it appeared to him that the effect upon credit and public convenience would have been extremely different in the two cases, The purchases of the commissioners had not only the effect of cancelling a certain portion of stock at the end of every year, but by their equable and regular operation they in a degree regulated the market during the whole of the year, and prevented those sudden fluctuations which the accidental circumstances of forced sales and of the combinations of speculators might otherwise occasion. Whatever might be the necessity of an individual to bring his stock to sale, he knew that there was a constant and considerable purchaser in the market, and that he could not fail at last with the delay of a few days to obtain the fair current price of what he had to sell. It was also to be recollected for how many years the public had been accustomed to the constant practice of these purchases, and how much their feelings might have been acted upon, and their apprehensions excited by the total cessation of an establishment, which has always been deemed so beneficial. He had not indeed been without some alarm at the effect which might be produced upon public opinion in the last year, when a loan from the sinking fund was for the first time carried into effect. He was ready to allow that the experiment had ended more favourably than he had apprehended it might do, but the difference was very great between the diminution, though considerable, and the total cessation of a resource of this kind. In future, indeed, he hoped that this ground of difference of opinion between the hon. member and himself would no longer exist, for he saw no reason to depart from the expectation which he had last year held out to parliament that the loan lately concluded would be the last, which so long as peace continued, the government would be under the necessity of contracting, except by application to the commissioners for the sinking fund.

He was here naturally led to explain a part of the subject, which had on various occasions been alluded to, and which nearly connected itself with this question—he meant a comparison between the estimates which had been formed in the session of 1819, and the actual result of the finances of that year. He was ready to admit that it was less favourable than had been anticipated; but he contended that the failure was not so considerable as to exceed ordinary fluctuations, or to justify the alarms which had been frequently expressed. The finance committee in April, 1819, had estimated the total income of the United Kingdom at 54,000,000l., its actual produce had been very near 53 millions, of which, however, 500,000l. had arisen from taxes imposed since the committee had made their report. The diminution, therefore, of revenue which arose almost wholly in the October quarter, and in the branch of customs might be taken at 1,500,000l. They had estimated the clear excess of income beyond expenditure at about 2,000,000l., to which would have been added the amount of any taxes afterwards imposed. The actual excess estimated in various ways might be taken from one million to a million and a half, and though certainly much less than was desirable to secure the prosperity of the country in the time of peace, yet was sufficient to complete the gloomy observations which were frequently thrown out of a great existing deficiency. In the present year it appeared from the accounts on the table as nearly certain as any estimate which could be formed, that the new taxes imposed in 1819 would produce at least the estimated sum of three millions. There would therefore, be a sum of about 2,500,000l. to add to the surplus of income beyond expenditure in 1819, making a clear improvement in one situation in the present year of about three millions and a half. It is true that this sum falls considerably short of the 5,000,000l. of clear income which was last year intended to be provided by parliament; but although that estimate might not be realised in the present year, which laboured under some circumstances of depression too obvious to require particular notice, he by no means saw reason to doubt that it would be speedily completed. One indispensable requisite indeed, as well to all financial prosperity, as to every effective economy, and to all encouragement of industry, was the complete and permanent establishment of tranquillity and good order among the people. When that great point was effectually secured, he felt the greatest confidence of the rest.

Having completed this part of his statement, he adverted in a subsequent explanation to the mode by which the charges of the loans were to be provided for. The principle which he adopted was that of the act of 1813. It had been at that time explained, though not positively enacted, that a sum of one hundred millions ought, in time of peace, to be reserved in the hands of the commissioners as a resource for the first exigencies of of any future wars. That sum had been now completed, and there was a considerable excess in the hands of the commissioners. The sum now actually standing in their names amounted to about 144 millions. He should therefore propose to provide for the charge of the present loans, by cancelling the excess of stock beyond 100 millions in the names of the commissioners, to such an extent as was necessary for providing for the expense as it arose, and so as to leave the sum of at least five millions as a clear sinking fund for the present year. The right hon. gentleman concluded with moving his first Resolution, "That towards raising the Supply granted to his majesty the sum of twelve millions be raised by annuities."*

Mr. Baring

did not intend to examine any part of the right hon. gentleman's statement, but rose chiefly to express some degree of surprise that no information had been communicated with regard to the consolidated fund. * The following is a correct statement of the Supplies and Ways and Means for the present year as compared with those of last year, together with the account of the Unfunded Debt for the years 1819 and 1820.

SUPPLIES.
Granted for 1819 Estimate for 1820.
8,782,470 Army £.9,422,000
6,436,781 Navy 6,586,700
1,191,000 Ordnance 1,204,600
2,078,197 Miscellaneous 2,100,000
18,488,448 Total Supplies 19,313,300
1,570,000 Interest on Exchequer Bills 1,000,000
430,000 Sinking Fund on Exchequer Bills 410,000
20,488,448 20,723,300
10,500,000 By Reduction of Unfunded Debt 9,000,000
30,988,448 29,723,300
WAYS AND MEANS.
Granted for 1819. Estimate for 1820.
3,000,000 Annual Malt £.3,00,000
3,500,000 Excise Duties continued 2,500,000
240,000 Lottery 240,000
334,000 Old Stores 260,000
7,074,000 6,000,000
12,000,000 Loan 5,000,000
12,000,000 Sinking Fund Loan 12,000,000
Funding Exchequer Bill 7,000,000
31,074,000 30,000,000
UNFUNDED DEBT.—1819.
Exchequer Bills, 59 Geo. 3rd, c. 4 20,000,000
Exchequer Bills, 59 Geo. 3rd, c. 131 16,500,000
Irish Treasury Bills 2,000,000
Bills issued for aid to Manufacturers, Fisheries, &c. 57 Geo. 1,000,000
39,500,000
1820.
Exchequer Bills 29,000,000
Irish Treasury Bills 1,500,000
30,500,000
By Reduction of Unfunded Debt 9,000,000
39,500,000
Mr. Hume

inquired whether the French contribution of two millions was forthcoming.

The Chancellor of the Exchequer

observed, that the hon. member had taken the two millions of francs, which was the French contribution, as pounds. In allusion to what had fallen from Mr. Baring, he admitted the great importance of that subject, and could only plead as an excuse for having omitted it, the necessary complication of so many points as it had been his duty to refer to. In the course of last year the deficiency on the consolidated fund had amounted to 3,000,0002. The deficiency, however, had arisen before the new taxes became productive, and also included the charge of two loans—those of the years 1818 and 1819. The new taxes covered that charge, and left a surplus of 1,800,000l. upon the whole year, or an improvement of 700,000l. in the last quarter.

Mr. Grenfell

wished for some farther explanation as to the expected amount of the sinking fund.

The Chancellor of the Exchequer

professed his readiness to lay before the committee every particular of the arrangements which he had in view, and upon which he framed his calculations. It was true, as the hon. member seemed to think, that it was his intention to cancel stock to the amount of this proportion of unfunded debt. This proceeding referred to an act of 1813, which provided for making stock in the hands of the commissioners applicable to the service of the year, and under which a plan was devised for accumulating stock to the amount of 100,000,000l. against the breaking out of a new war. It was only from a surplus above that sum of a hundred millions that he took the proposed sum of 12,000,000l. In the year 1821, he trusted that the whole accumulation would amount to 115,000,000l.

Mr. Grenfell

contended, that the plan of the right hon. gentleman was still calculated to diminish rather than cause any real excess of the revenue over the expenditure. With reference to the consolidated fund, he repeated what he had said on a recent occasion, that it was a most unseemly and odious blot on the character of the government, to allow of a constant deficiency in that fund of between seven and eight millions; and he strongly urged the expediency either by a loan, by the issue of exchequer bills, or by some other mode to put the matter straight. Government were placed by the present state of the consolidated fund in this situation—that they could not pay any quarter's dividend to the public creditor but at the will and pleasure of the Bank of England. The right hon. gentleman must altogether depend not only on the ability of the Bank to assist him, but on their will and pleasure to do so. Was it fitting that government should thus be in the power of a corporation, with reference to the means of paying the dividend to the public creditor? Was it possible that in that state of things the chancellor of the exchequer could feel himself in that independent condition which could alone enable him to make the best bargain for the public? As to the loan of twelve millions from the sinking fund, his right hon. friend had by no means convinced him of the propriety of continuing the present system. The right hon. gentleman knew that the whole system was fictitious—that it had no existence but in books, where it appeared to be so much stock for so much money. In reality, it was neither the one nor the other, but a thing that ceased in the very moment that it came into existence. With regard to its connexion with the affairs of the Bank, he had so often discussed that subject that he should not go into it at present.

Mr. John Smith

disagreed altogether from the hon. gentleman who had just spoken, as to the operation of the sinking fund; and maintained that it created a market for stock, and thereby prevented its depreciation. Adverting to the general question of our financial condition, he observed, that although he by no means charged it as matter of blame, yet that in fact almost all the expectations which had been last year held out by the chancellor of the exchequer had been disappointed. Our revenue had decreased, and our expenses augmented; and that, five years after the termination of war! He confessed that he had long entertained a melancholy foreboding of our actual condition. For the first time he had observed a suspicion and a distrust of the credit of this country. This was a new feature in our situation. In the midst of the late long and dangerous war, this country had been considered the asylum of property. Foreigners brought property of every description to England; but things were sot much changed, that many Englishmen were at the present moment investing a portion of their property in foreign funds, in order to have a nest egg. The fact was, that the real state of our finances was very little known in that House. This was mainly attributable to the bad mode of keeping the public accounts. In a variety of points, and especially in those parts of them which related to exchequer bills, the accounts might be rendered much more clear and explicit. He concurred in what the right hon. gentleman had said, of the impracticability under existing circumstances of touching the capital of Ireland. Adverting to the Austrian loan, he observed that the circumstances of Austria might have improved within a few years, and he should be glad to find that some application had been made by our government for the repayment of that loan. He contended that ever since the close of the war we had been going on most improvidently. He charged the government with useless extravagance. He did this without the least bitterness; for he thought it was a charge which attached on every member of the House. With some few exceptions, he thought that they were all greatly to blame for not having paid more attention to our very extraordinary expenditure. In the civil department of the ordnance, of the navy, of the army, &c money had been expended—he would not say uselessly, but without absolute necessity. If a private individual became distressed, what course did he take? He looked into his affairs, he retrenched his superfluities, and perhaps some of his necessaries, arid be took care not to be guilty of any expense for which there was not an absolute necessity. Such however, was not the course which government and the legislature had pursued, Now, in looking over the account of public expenditure, he found many charges, under the head of pensions. Those items were looked upon as of little importance, but he saw the other day a pension of 550l. a year granted, certainly to a very respectable individual, now governor of Trinidad, for five years service, that gentleman also receiving the salary of his present appointment. The blame of this and other charges on the public revenue were not to be wholly attributed to government. The blame ought to be laid upon parliament generally. The House had, in fact, shown the greatest apathy on such occasions; an apathy which he feared was too much felt out of doors. They ought to look with the greatest jealousy to the ex- penditure of the country. The revolutions which had taken place in all modern states had originated in the embarrassed state of their finances. He apologised for having trespassed on the attention of the House, but he begged or them to consider what they were about. Unless a different system was adopted, he feared the day was not far distant which would bring the deepest and most calamitous distresses on the country.

Mr. Ricardo

said, he could not clearly understand the alleged benefit which the money-market was to receive from the right hon. gentleman's arrangement. It was certainly a subject of lamentation that, after five years of peace, we should still find our expenses increasing. According to the right hon. gentleman we had had effectually a sinking fund of but 1,000,000l. during the last year; but if this were correct, and the right hon. gentleman were to follow out the statements contained in the report of the finance committee, he would perceive from the expenditure that there had been an actual deficiency. He would here observe, that he found an item of 1,125,000l. perfectly unexplained. There was no account by which he could trace the manner in which it was proposed to provide for this item of 1,125,000l. The surplus of 1,000,000l., which had been mentioned by the right hon. gentleman, he had already taken into account; but he must contend that this sum of 1,125,000l. still appeared as against the accounts given in by the chancellor of the exchequer, whether he looked at this or at that paper. This sum of 1,125,000l. ought to appear, therefore, among other outstanding demands. He had a right to presume that the right hon. gentleman was bound to provide for this particular one, among the others. Next year it was anticipated by that right hon. gentleman that we were to have a sinking fund of between three and Tour millions. During the present year, he said, that he calculated, after deducting 9,000,000l. of unfunded debt to be paid off from 11,000,000l., that there would be a sinking fund of about 2,000,000l. But the right hon. gentleman seemed to forget, that this imaginary improvement of his was made to appear twice in the same statement. He first of all said, that we should have a sinking fund of such and such an amount; but, when he came to speak of the deficiencies upon the consolidated fund, and of the fund out of which † they were to be supplied, he must have forgotten, when he was expatiating upon the sinking fund, that he was alluding to that out of which those very deficiencies were to be so supplied. And, throughout all these accounts, he had clearly forgotten that there was, in the quarter ending in January 1819, a deficiency of 8,000,000l. upon exchequer bills. He quite agreed in every word that had fallen from his hon. friend, the member for Penrhyn, respecting the alarming deficiency upon the consolidated fund. He quite concurred with him in saying, that that which was the growing produce of the consolidated fund used to be sufficient to pay all the demands upon it for the current quarter; whereas, instead of this, it was now found insufficient to pay even the arrears of the preceding quarter. During the last year, he considered the finance committee to have pursued a very good plan in letting them know what was the real state of the finances of the country. The committee had allowed them to see, in that, whether their amount was greater or less than it had been at that time twelve months. Now, he had endeavoured to apply the very same plan to the accounts of this year; and he found it to apply to them in a most remarkable manner. The committee last year estimated the unfunded debt at 531,133,000l. They took the amount of exchequer-bills &c circulation, of Irish treasury bills, deficiency bills, &c.; and the result of their estimate was 53,133,000l. By the papers before the House, it appeared, that at the periods to which they were made out, the unfunded debt was actually diminished sin1 the sum of 2,000,000l. only, although the right hon. gentleman calculated that diminution at upwards; of 10,000,000l.. If, however, the papers before them were correct, be must contend, that the amount of actual diminution upon the unfunded debt, between the 5th of January 1819, and the 5th of January 1820, was only 2,000,000l. It was now necessary to see in what ratio the funded debt had increased; and by the returns that had been made to the House, they would find that the sum actually received by loan (which loans last year amounted to 24,000,000l.) was 18,736,000l. Deducting the sinking fund from this, the balance must necessarily be the actual amount to which the funded debt had been increased during the present year; and that increase was to the exact extent to which the unfunded debt had been this year paid off, namely. 2,000,000l.: so that, after all the complicated accounts that had been submitted to the House, the general result was this—that they had decreased the unfunded debt 2,000,000l. and had increased the funded debt 2,000,000l. It had been said that, in point of fact, there was no sinking fund whatever, for that the deficiencies upon the interest of exchequer-bills would amount to a sum about equal to that fund. And indeed it appeared to him, that these deficiencies had increased 1,370,000l. more than they amounted to last year. He had one observation more to make about the funding of 7,000,000l. of exchequer bills. The hon. member for Penryhn had paid some compliments to the chancellor of the exchequer, for having upon this occasion funded in the 5 per cents, rather than in any other stock. But, in order to contend that that was a judicious measure, he ought first to have shown that there was a sufficiency of capital to fund in the 5 per cents rather than in the three per cents. If they possessed a very large sinking fund and that sinking fund was likely to be operative, then undoubtedly it was proper to fund, in a new stock and create one of 5 per cent in preference to funding in the 3 per cents; and, in that view of the question, he should have been disposed to, have approved of the former of these measures. But, seeing that they possessed little or no sinking fund, he was very much disposed to doubt, whether the terms of such a loan would be of that advantageous character which his hon. friend seemed, disposed to attribute to them.

Mr. Maberly

could not but remark the great difference that existed between the present propositions of the right hon. gentleman and those which he had made last year. Last year he came down to that House, and said, that during the preceding year, he had been acting upon temporary expedients, but that he was then beginning to act upon a permanent plan, whose operation would be to make a sinking fund of 5,000,000l. The right hon. gentleman, on that occasion, laid the strongest stress upon the position, that a sinking fund of 2,000,000l. was not sufficient; he therefore proposed 3,000,000l. in addition, and declared that less than 5,000,000l. would not be sufficient to support public credit. The right hon. the member for Chichester concurred in the same opinion. His words were, that he would not place in the hands of any corporate body whatever the chance of ruining our credit; that it would be a very inexpedient thing to go on with the consolidated fund in its then arrears; and above all, he said that the credit of that fund was bound up with the credit of the empire.—Here the hon. gentleman, entered into a recapitulation of charges and items; the purport of which was, to show that the measures hitherto adopted by government, in regard to the deficiencies upon the consolidated fund, had been inefficient. The total deficiency upon the last quarter in these accounts, if every charge were brought under consideration, would be about 500,000l.; and he was very much afraid that the right hon. member for Chichester, who understood the finances of the country so well, would find the plan that had been adopted a very bad one for providing against these deficiencies, supposing the exchanges should be against us, and that there should be a rise in the price of gold. Admitting there was an increase of 2,000,000l. upon the ordinary revenue of this year over that of the last—giving ministers credit for this accession of income—it resulted from the papers before the House and the calculations to be made upon them, that on the 1st of January 1821, the consolidated fund would be in debt 9,500,000l. Last year the right hon. gentleman, had stated his supplies at 20,427,000l., and his ways and means at 7,024,000l., leaving a difference of 13,403,000l. But to, this difference of 13,403,000l. was to be added, the deficiency of the consolidated fund, leaving a balance of about 15,000,000l. He did not mean to contend that the revenue had not risen in amount; certainly not; and it was not his object to darken the picture at all; but what means had they of raising such a sum as 15,000,000l.? The right hon. gentleman's budget of this year he considered to be perhaps the best that he had ever presented to that House, because it seemed to hold out a fairer chance of realizing a sinking fund than that of any former year. He should be happy if it should turn out that he was wrong, and the right hon. gentleman right; but at present he did not anticipate a sinking fund of three or four millions, but one nearer two millions., He could not help pressing on the right hon. gentleman and the noble lord the present actual state pf the sinking fund, and the consideration of what would be the consequence of at tacking it, supposing they were ever reduced to that necessity by a state of war. He pressed upon the noble lord and the right hon. gentleman the necessity of adopting some measure for raising and supporting that sinking fund. For what was the condition of our finances now, and of that fund in particular, after six years of peace? For his own part, he knew of no other means of providing for so desirable an object but a property tax. He was aware of the many objections that attached to it; yet certain he was, that no other means could be devised but one, and that one was a property-tax. He could conceive no tax, the operation of which would be more generally advantageous. No gentleman whose property was vested in houses would neglect to insure those houses against fire; and he could see no reason why those measures should be neglected which would tend to insure possessions of a different description from those dangers to which, in the common course of events, they might be exposed.

The Chancellor of the Exchequer

admitted, that the public had not yet made all those sacrifices, which, unfortunately, were necessary to the national security; but he felt convinced that they would not shrink from any sacrifices, when convinced of their necessity, and that every possible measure of retrenchment had been resorted to by government. Whether these contributions were made in the shape of a property-tax, or in any other shape, was a matter of no consequence. With respect to the present situation of the country, he felt the importance of an efficacious and productive sinking-fund; and he hoped that the produce of that fund would this year be considerable. There had been in the course of the last year a reduction of the public debt, although that reduction had not been so large as could be wished.

Mr. Alderman Heygate,

in considering the state of the consolidated fund, deprecated those measures which went to relieve a present inconvenience by the assistance of a loan. If the chancellor of the exchequer adopted the counsel which had been given him by several gentlemen, the effect would be to pay 5 per cent for the loan of that which the Bank now furnished, partly at a very low rate of interest, and partly without any interest at all. According to an arrangement which formed part of the law of the country, the Bank were bound to furnish a certain sum of money if called upon by government, and of that arrangement they had no room to complain; for in the course of the bargain concluded with them last year, they had not even asked that the advances in respect to the consolidated fund should be placed upon any other foundation. He took this question to be infinitely more important, as it affected the quantity of money in circulation in the country, than as it went to any trifling saving of four, five, or six per cent upon the amount in question. There was a wide difference between the effect of loans raised for the service of the country in time of war, and these for the payment of the Bank. A loan for the service of the country in war left the circulating medium exactly where it stood before the loan was made; but a loan of the other description went to place the circulation of the country under the control of the Bank. It was utterly unworthy a country like England to be eternally changing her plans of finance. Nothing was more likely to discredit the country in the opinion of foreigners, than continual variation of system, and attacks as continual upon the sinking fund. He trusted that after the present year a period would be put to these repeated loans.—After five years of peace it was unwise to raise money for any purpose by way of loan. He agreed with the hon. gentleman that if the financial situation of the country were candidly and fully stated, the public would not be wanting in those exertions which would again place the nation in that state of credit which it had formerly enjoyed, and which had rendered it during the war an asylum for the capital of the world. The effect of funding 7,000,000l. of exchequer bills in the navy 5 per cents would be to throw upon the country an additional charge of 140,000l. a-year.—Upon the loan of 5,000,000l. lately contracted for the purpose of repaying the Bank, the additional charge beyond what was now paid to the Bank was also about 60,000l. per annum, and when he heard gentlemen upon that side the House advocating the cause of economy, and disputing vehemently upon a salary of 1,000l. a-year to a lord of the admiralty, he was surprised to see sums amounting to 200,000l. a-year wasted without opposition. There was another question which bad scarcely been noticed during the session, but which he could not help thinking a subject of great importance—he meant the diminution of the circulating medium. He had heard the fact denied; but he was at a loss to know upon what grounds that denial could be maintained. Let the House contrast the quantity of the circulating medium which was floating in the country in May, 1818, with the amount in circulation in the same month in the present year. In the issue of Bank of England notes, there had been a diminution of 4,000,000l. In the issue of country bank notes there had been a diminution of 5,000,000l. The total decrease therefore during that short period had been 9,000,000l., a sum amounting to more than one-sixth of the whole circulation of the country. The state of the exchange had been during that period almost uniformly in our favour; but not a single piece of gold had made its appearance to replace the notes which had been withdrawn. He was not so strenuous an advocate of the paper system as to deny that gold would be preferable, if gold could be obtained; but, in the mean time, a currency of some description was indispensable, and he sincerely believed, that three-fourths of the distress which pervaded the country had arisen from the haste with which so large a proportion as 9,000,000l. had been withdrawn from the circulation. As the market and the mint price of bullion, however, were now the same, the object of the bullion committee was at an end; and there could be no pretence for any farther diminution of the circulating medium. Paper, indeed, was at present rather more valuable than gold. The hon. member then proposed a resolution, regretting, in the fifth year of peace, the adoption of any measures tending to augment the public debt, and recommending such a system of economy as should eventually lessen the burthens of the people; and concluded by expressing his ardent hope, that the system of borrowing would henceforward be relinquished, and that the deficiency, if any, in the revenue of the next year, would be met by more manly and effective measures.

Mr. Huskisson

agreed, that it would be highly desirable that the consolidated fund, instead of being in arrear, should afford a surplus over and above the service of the year; and wished that the state of the country would admit of the sinking fund being made more efficient. In answer to what had fallen from the hon. member who bad last spoken, he would simply quote the admission of that gentleman himself, that the value of paper at the present moment was somewhat higher than the value of gold. That simple fact formed, he conceived, a sufficient reply to all the danger which that hon. member had apprehended. He trusted that by a reduction of expenses this country would soon find itself in a situation in which the 5,000,000l. of the sinking fund might be realised.

The several resolutions were agreed to.