HC Deb 18 April 1823 vol 8 cc1123-5

On the Order of the day for the third reading of this bill,

Mr. Grenfell

opposed it, as an improvident bargain for the public.

Sir J. Newport

contended, that this bargain with the Bank was a direct violation of the statute of William and Mary, which prevented the Bank from becoming a dealer and jobber in public securities.

The Chancellor of the Exchequer

defended the bargain made with the Bank, and contended that if it had been made with the commissioners of the sinking fund, it could not have been made on more advantageous terms. He likewise, maintained, that there was no difference of operation between the Bank's dealing in exchequer bills, as it now did, and its dealing in funded stock to the extent which this measure authorised.

Mr. Hume

wished to be informed, why this bargain with the Bank, had been made in a hole and corner, secretly, and without any public competition. The right hon. gentleman's predecessor in office had given the public a pledge, that any bargain which he made for the sale of these annuities should always be made publicly, and be opened to the widest competition. Why had the right hon. gentleman abandoned that pledge? The price at which the bargain had been completed was detrimental to the public. He thought that, except in that House no 133 reasonable beings could be found to sanction it. He, therefore, called upon the House to reject it, and to break off the secret contraband trade, which at present existed between the chancellor of the exchequer and the Bank. He would move, "That the bill be read a third time this day six months."

Sir J. Yorke

said, that as he did not understand more than the four first rules of arithmetic, he would not pretend to compute the profit or loss which was likely to accrue from this bargain. What appeared strange to him was this—why the bargain had ever been made at all. As the dead charge was to extend itself over 15 years, was it intended that at the end of that period, every spectre of it should be defunct? And if so, what was to be done with those persons who were daily coming upon the half-pay-list? He could understand the policy of the plan, if at the end of the 45 years every man on half-pay was to be as dead as Julius Cæsar. But that was not likely to be the case. There was a constant supply for the half-pay list. Scarcely a day passed without some officer coming on the half-pay from the 200 admirals, 800 captains, and 3,000 lieutenants, who had rank in the British navy.

Mr. Ricardo

did not blame the Bank directors for making as advantageous a bargain as possible for their constituents. It was, however, an extremely improvident one for the country. He thought that there was also a constitutional objection to the contract, founded on the nature of the charter of the Bank, and the manner in which the capital was made available to the public. It seemed to him highly impolitic, that the Bank should be allowed to make speculations in the funds. At all events, ministers ought to have delayed the conclusion of the bargain, until they had laid the papers regarding the late negotiations upon the table: had they so waited, the bargain might have been more favourable to the public. He wished to know whether the Bank was to be allowed to charge for the management of this transaction, as well as for the management of the public debt.

Mr. Huskisson

answered, that the Bank was to be allowed nothing beyond the terms of the contract which were before the House. He contended, that the bargain was advantageous for the public, and that the Bank were permitted to deal in public securities. The manner in which they had allowed the power to lie dormant, so that, even the hon. member did not know it existed, proved how harmless it had been.

Mr. H. Gurney

said, he thought that in all the debates on this bill, the greatest evil had been the least, if at all, touched upon; namely, the extremely improper and dangerous investment of the funds of the Bank; this being a species of transaction contrary to every sound banking principle, and one which, drawn into precedent, must inevitably endanger the ultimate security of that establishment.

Sir F. Blake

opposed the bill. He said he could not express his hatred of the sinking fund in better terms than by the words "Delenda est Carthago."

Mr. Monck

suggested, that the contract was in violation of the act of William 3rd which prohibited the Bank from lending money on crown lands or public securities. As it was a matter in which they were pecuniarily interested, the directors and proprietors of the Bank who were members, ought not in delicacy to vote.

The House divided. For the third reading 140. Against it 91. The bill was then read a third time and passed.