HC Deb 11 February 1830 vol 22 cc381-9
Mr. Attwood

moved for accounts of the amount of Sovereigns and Half Sovereigns issued by the Governor and Company of the Bank of England, from 2nd May 1828 to 31st December 1829, both inclusive:—Also, of the same received by them during the same period; distinguishing the amount paid, the amount received, and the balance:—Also, of all Sovereigns and Half Sovereigns coined at the Mint for other persons than the Bank of England, from 2nd May 1828 to 31st December 1829, both inclusive.—In submitting this motion, he must say, it frequently happened that Ministers, in the course of their observations to Parliament, alluded to and quoted from documents which were not before the public, from which circumstance a considerable degree of embarrassment took place. It was a practice, therefore, which it was extremely desirous to have obviated; and to him the best way of obviating it appeared to be to have all such documents previously laid before both Houses of Parliament. A remarkable instance of this kind resulting from the want of this sort of information, occurred the other night in the other House, when the Duke of Wellington had occasion to address their lordships on the currency, in the course of which he made various statements, none of which had been regularly placed before Parliament. It however, appeared to him that most of the noble Duke's statements were consecutive on the speech of the Chancellor of the Exchequer in the year 1828—their respective amounts agreeing exactly, with the exception of a difference of six millions between the country bank notes and the sovereigns. This was not a question to which he should so seriously call the attention of the House, were it not, in his opinion, the one which, of all others, was most important and interesting to the whole country at the present crisis. He well remembered the speech of the right hon. Gentleman (Mr. Peel) on this subject some few years ago, when he had assured the House that they were then within reach of the goal, and had only to exercise a little firmness to arrive at it. But how did the matter present itself now? Was the goal arrived at? No; and yet the Minister still exclaimed, "Oh, trust to us; we shall do every thing that is right, and therefore you must not expect any inquiry!" The Government was committing the most fatal and most disastrous of errors, and he besought it to take warning while it was not yet too late, before they entailed upon it a responsibility greater than any Government could bear. According to the Duke of Wellington's statement, there was now a circulation of sixty-five millions in the country; from which the Premier argued that they were wrong who complained of there being any want of money in the country. What was the meaning of this statement, that money was universal? But was it so? He would ask the landlord—did he obtain the same rent as heretofore? He would ask the merchant—did he obtain the same profits as heretofore? He would ask the manufacturer—did he employ the same number of hands as heretofore? He would not ask those on the Treasury benches whether the same money was received there as heretofore, because he did not intend to deny it; but he would ask them—did they not find that with the same money they had much greater power. The French were in the habit of distinguishing between their two sorts of money, by calling the one monnoie forte, and the other monnoie foible; and he thought that similar terms might with justice be used in this case. It was by concentration that money obtained this force and power; and it was therefore deducible, from the circumstances which he had stated, that there was much less money in the country than there had been formerly. Having shown from argument that this must be the case, he would now proceed to show the same point from facts. It was very evident to him that the whole of the tables upon which the Duke of Wellington had gone were founded in error. The Exchequer was receiving twenty millions less than during the war—the landed interest twenty millions less, and the labouring classes not half so much as at that former period; in fact, these latter, instead of money, were obliged to be content to receive butter, hats, clothes, and such like commodities, in exchange for their services; and one instance that he had heard of carried this so far that a labourer having received a leg of mutton for his labour, and having a child to be baptised, he took his joint to the parson, and begged him to cut off as many slices as were equivalent to the baptismal fee. If there were really sufficient money in the country, or if the Ministers really believed that there was, why did they not propose the appointment of a Finance Committee who might inquire where it lay concealed, and devise the proper means for putting it into circulation? The real fact was, that the statements of the present gold currency, as made by the Duke of Wellington, were entirely in error. In the Duke's estimate of the amount, he took it for granted that every sovereign that had been coined since 1824 was still afloat in the country; in no way did he make any allowance for the prodigious quantity that must have found their way out of the country as exports, with the exception of one batch of six millions, in the course of a certain period of eighteen months, and of which the Bank was cognizant; but how many were there exported of which the Bank knew nothing, and could know nothing? Every now and then it was the interest of the merchant to export according to the vibrations that took place, and the only way in which those small vessels which imported cheese, butter, eggs, &c. were paid, was by sovereigns. Let the House also consider, that the number of absentees were now reckoned at one hundred thousand; and did not those gentlemen take any of the currency away with them? To these reductions of the actual currency was also to be added that most important one, caused by the melting of sovereigns. Formerly the Birmingham and other manufacturers employed a broker, in London, to purchase gold for them; but now they found the easiest way to be to melt down sovereigns as they wanted them. All these, then, were ways in which the gold currency must have rapidly diminished, and for which no allowance had been made in the Duke of Wellington's statements. The honourable Gentleman concluded with moving for the Returns described at the opening of his Speech.

The Chancellor of the Exchequer

said, although the hon. Member had accused the Members of his Majesty's Government with supporting their views by fallacious statements respecting the currency, he believed he should be able to show that the hon. Member had formed erroneous conclusions upon the nature of those statements, and that he had himself been guilty of errors not less material than those which he imputed to the Government. The foundation of the principal argument of the hon. Member rested upon the view which he took of certain statements made in another House by the noble Duke at the head of his Majesty's Government, and by him (the Chancellor of the Exchequer) in the House of Commons, for the purpose of drawing comparisons between the circulation of the country at one period and another, and from these comparisons endeavouring to arrive at some conclusion on the question, of whether or not the distress was produced by the state of that circulation. Now, these comparisons were formed on data of precisely the same character—the calculations were made on foundations precisely similar; and if they were erroneous, as the hon. Gentleman seemed to suppose, at one time, they were equally erroneous at another, and therefore the errors, as far as the mere question of comparison went, were calculated to produce very little effect. All that the noble Duke contended for, and all that he himself desired to be drawn from them, was to find some corresponding data, approximating in period and circumstances to each other, through which they could form a comparison as accurate as the subject would admit. The hon. Gentleman says, that the noble Duke urged these comparisons, so formed on erroneous foundations, as a reason for believing that no distress existed in the country. Now he (the Chancellor of the Exchequer) denied that the noble Duke used these calculations for any such purpose. The noble Duke used these calculations as a reply to the statements of those who thought that the evils under which they supposed the country to be suffering could be remedied by an unlimited circulation of paper. For that purpose he endeavoured to put them in possession of the amount of the circulating medium in the last year, as compared with another year in which that unlimited currency was allowed. To begin with the first of the hon. Member's opinions:—He holds that the gold in circulation cannot be so much as twenty-eight millions, because there is no allowance made for the amount withdrawn from circulation for exportation or other purposes. Now the fact is, that the whole amount of gold coined at the Mint has been forty-four millions one hundred thousand pounds, and it is in that surplus of sixteen millions one hundred thousand pounds that the noble Duke found the means of accounting for the quantity removed from the circulation, and which the hon. Member erroneously supposes was not taken into the estimate. But he would tell the hon. Member why it was, that the noble Duke assumed twenty-eight millions to be the amount of gold in circulation. He thought the hon. Member would admit that so long as the foreign exchanges were in favour of this country, there could be no danger of the gold in circulation going abroad as an article of commerce. He was confident, although it would not be unlike some of the assertions of the hon. Member if he maintained the reverse, that while the exchanges were in our favour, no great quantity of gold would be sent abroad by the merchants; and, although some few gentlemen might take a small quantity with them for the ordinary demand of travel, as long as the exchanges were favourable, even that small quantity would ultimately find its way back again; for the advantages obtained by it were too obvious to be passed over. As to those who required their rents to be remitted to the continent, he need not surely say that no gentlemen under such circumstances would ever require those remittances to be made in English sovereigns. But then a period might come when the exchanges would be unfavourable to this country. It was impossible, he believed, to say to what extent the gold of the country found its way abroad at such a time, but the calculations by which they endeavoured to make an approximation to the truth were founded on this opinion—that for every sovereign sent abroad there was a demand made for one to replace it on the gold in the hands of the Bank of England. Now this calculation he really did not think an unfair one, for as the gold, under such circumstances, was collected from every part of the country to be expended, so in proportion to the vacuum thus created was the demand on the Bank to fill it up with a fresh supply. But even supposing that the drain created in such cases was greater than this calculation would account for, still he thought that the difference might be naturally accounted for in another way. As in the event of the exchanges being in favour of this country, the estimate was wholly formed on the amount of gold which passed through the hands of the Bank of England, without any reference to the importations of bullion by individuals, so at other times, supposing that some which remained in the hands of individuals was exported in addition to that demanded from the Bank; he apprehended they would, by taking these two additional circumstances into consideration, arrive at a conclusion not very foreign to the truth. At all events, he had. stated the amount vested and withdrawn from the circulation in this manner to be calculated at sixteen millions five hundred thousand pounds, and he thought that was a sum sufficiently large to justify and bear out the assertion, that the present circulating medium amounted to twenty-eight millions of gold. The hon. Member had found by some calculations of his own, that at the conclusion of the war there were ten millions of guineas in the country. Now, it should be recollected, that for a considerable portion of that war, the guinea was selling abroad at the price of twenty-seven shillings, and that the temptation of this price caused every exertion to be used through the country for the purpose of collecting them, although the exportation of bullion and guineas was then declared to be contrary to law. Now the fact was, although the hon. Gentleman supposes the amount to have been ten millions, the whole quantity called in, when the sovereigns were issued, was only four millions. He mentioned this merely because the hon. Gentleman seemed to suppose there had been an exportation of guineas after the coinage. Passing now to the objection of the hon. Member, with reference to the statements on the circulation of Bank paper, he thought it would be in the recollection of the House, that at the time he introduced the measure with respect to the withdrawal of the one pound notes from circulation, he took that circulation to amount to two millions and a half. One calculation produced two millions one hundred thousand; another, two millions four hundred thousand; and therefore he thought the fair average would be two millions five hundred thousand. But the hon. Gentleman contends that the calculations and statements of the noble Duke, authorized and supported by his, would make the amount six millions. Now, here again he must say, that the hon. Member completely misapprehended the nature of the noble Duke's statements, and did not make sufficient allowance for the large number of notes which, previous to the termination of the system, were either destroyed or withdrawn from circulation. At the time of the passing of the law for the abolition of the power to issue small notes, he (the Chancellor of the Exchequer) had expressed an opinion that the place of the small notes would be supplied in the circulation by others of a higher denomination. Of the truth of that assertion the hon. Member had intimated some doubt, and he should, therefore, take leave to read a short account of the amount of stamps issued for 5l. notes and upwards for the quarter which succeeded the announcement that no more small notes were to be issued. It will be remembered that the time to which the circulation of small notes was limited was the 5th of April, 1829. Now it appeared the amount of stamps issued for notes of 5l. and upwards, was, on the

5th of April, 1827 £382,000
5th of July,— 244,000
10th of Oct.— 285,000
5th of Jan. 1828 317,000
5th of April,— 318,000
5th of July,— 258,000
10th of Oct.— 458,000
And now, approaching the period when the circulation of the small notes was to terminate, he found the number of stamps issued on the—
5th of Jan. 1829, to be £876,000
5th of April,— 737,000
Showing, on a comparison with the two corresponding quarters of the year 1828, an increase of sixteen hundred and thirteen thousand, as compared with six hundred and thirty-five thousand. He thought it right to trouble the House with this detail of figures, because the hon. Member had expressed considerable doubts of the accuracy of the statements; and because it might lead to erroneous ideas of the amount of paper withdrawn from circulation. There was one other subject to which he wished to advert in a very few words. The hon. Member had alluded to the amount of gold which passed through the hands of the Bank of England; but did the hon. Member recollect that individuals, by the new regulations at the Mint, had the facility of taking bullion to be coined, and that the amount so coined on private account was above one million five hundred thousand pounds in a year and a half? Having said thus much, he should not trespass further on the attention of the House, but conclude by observing, that he could have wished the discussion on these subjects had been postponed until the hon. Member was in possession of all the information he desired, as he would then have had an opportunity of meeting him when he was armed with all that knowledge which he seemed to think had been withheld. He would do the hon. Gentleman the justice to say, however, that although he could not help feeling he had been guilty of misrepresentations, he believed them to be more the effect of want of information than of any intention to mislead.

Mr. A. Baring

said, he confessed, that although these discussions did not produce much at present, they tended, in his opinion, to elicit information, and to make the House better acquainted with a very complicated subject. He thought, too, that the statements put forth by the noble Duke in another place were made much too positively and confidently, when the nature of the question was fairly considered; for, although the grounds of the calculations were very clearly explained by the right hon. Gentleman, yet he conceived it to be quite impossible from those calculations, or from, indeed, any other, to come to an accurate conclusion with respect to the real amount of gold remaining in the country. The amount of small notes, and the stamps issued for those of five pounds, depended on accidental circumstances; and he must contend that a great quantity of gold had, from the alloy of the sovereigns being silver, found its way into the crucible. Every one who looked at the sovereign now must perceive that it was of a much darker colour than that issued formerly, because the alloy was now composed of copper; but until that had been adopted, it was for years a kind of trade in Paris and Birmingham to melt down the English sovereigns on account of the very small quantity of silver which they contained. While on that subject, he would say that it was well worth the while of the Government of this country to look a little at the expense of the Mint. In France the Mint paid itself from the profits obtained by the Master; but in this country the Master and his assistants cost from one to one hundred and fifty thousand pounds a year, without taking into consideration the very large gain derived by the Master from the coinage of silver. That coinage had been nearly nine millions, and the profits on it, which were very considerable, had gone without any inquiry into the pocket of the Master. It had been stated, with some appearance of truth, that the total value of commodities in transit from one individual to another, was reduced from one hundred to sixty millions; and he, therefore, thought it not unfair to presume, that the circulating medium may have been reduced in the same proportion. He should not now trouble the House further; but as it was sometimes imputed to him that he made speeches which were one half in one way and one half in the other, [a laugh, and loud cries of hear, hear] he should say that the facility of local circulation in the one case was perhaps fairly balanced by the security obtained in the other, and on that he would rest his defence.

Mr. Attwood

repeated, that he had heard nothing which induced him to change his opinions; he re-asserted his original propositions; and maintained, that both the Chancellor of the Exchequer and the noble Duke at the head of his Majesty's Government, had greatly overstated the amount of gold that had been, and that was, in circulation.

Motion agreed to: papers ordered.

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