§ Lord Althorp moved the third reading of this Bill.
§ Mr. Cobbett
rose to move as an Amendment, that the Bill be read a third time that day six months. He was ready to state to the House the grounds on which he moved that Amendment, but if he did he must go into the whole question. The principal objection was to the legal tender. He did not object to the renewal of the charter, nor to the establishment of joint-stock banks, for he knew nothing about them, but he did object to the making Bank of England paper a legal tender. He would contend that, in doing so, they usurped the King's prerogative in changing the coin of the country, and that they had no right to do so. He repeated, that he objected to the making Bank-notes, which might be issued without restriction, a legal tender. The noble Lord had stated, over and over again, that the Bank would always know, from the state of the foreign exchanges, how to regulate the amount of its issues; but if the noble Lord thought so, he had never been more deceived upon any point in his life. The present measure went to make an alteration in the value of the King's coin, and in defence of it they were told, that it was an alteration proposed for the relief of the country. The noble Lord must know, that such was the expression of all those who were in favour of this Bill, at least out of that House. It was to relieve the country, they said. How? By making money more plentiful, the taxes lighter, and the people more able to pay them. Such was the object of this measure, according to many persons in that House, and according to all its advocates out of it. The only way in which it could effect what was expected from it was by lowering the value of money, and therefore certain danger would come from the Bill, for it would be impossible to relax 765 the currency without producing danger. For his own part, if he were to give way to his own feelings, and not to consult the wishes and interests of his constituents, he should rejoice at the passing of this Bill, for, in the first place, it declared that the interest of the debt could never again be paid in gold. It further declared that Peel's Bill never could be carried into effect, and though the right hon. member for Cambridge seemed to have a design upon his life, so eager was he on every occasion to enter the lists with him, yet he would state, even in his presence, that if this Bill should pass, it would establish his (Mr. Cobbett's) reputation as a prophet. He was on the other side of the Atlantic when Peel's Bill was passed, and he then said at once that it never could be carried into full effect since; and it never had been carried into effect. That Bill proposed two things—namely, that legal tenders should cease and that the notes should cease. But 1l. notes had never yet ceased in England, Ireland, and Scotland, and now it was proposed that they should come back to the legal tender in England. So that ten years had scarcely elapsed since the passing of Peel's Bill when it was proposed actually to repeal it. When the present measure passed, he would certainly celebrate the feast of the gridiron. This measure involved a positive breach of the national faith. It would raise prices, said its advocates, but how would it raise them? By lowering, in the most arbitrary manner, the value of money. The effect of it would be to deduct from the interest of the debt, and to reduce every debt, annuity, and mortgage. There was another effect that might, with certainty, be expected from this measure—namely, an immense increase in the amount of forgeries. We should not always be at peace. We must some time or other, look forward to being at war, and when at war, what was to hinder the foreign nations opposed to us from inundating us with forgeries of our "legal tender?" He heard what had just been said by the right hon. Secretary (Mr. Spring Rice). The right hon. Secretary was wrong. He did not recommend the adoption of such a system on the part of foreign nations; but, whether he did so or not, they might resort to it, and he must say, that if they did he should not be sorry to see it done. If it should be done, the effect of it would be to blow up altogether our legal tender system. This Bill 766 was a mere expedient to put off the evil day, and it was an expedient that was full of danger. He would therefore move, that it be read a third time that day six months.
§ Mr. Clay
had intended to make a similar Motion, had he not been anticipated by the hon. member for Oldham. He did not mean to follow that hon. Member through all his statements, though he nearly concurred in all of them. The hon. Member had put forth his statements rather too strongly, since he believed that the noble Lord (Lord Althorp) did not intend to establish the non-convertibility of paper into gold. He confessed, however, without going so far as the hon. member for Oldham, that the measure would have a tendency to limit the convertibility of paper. One of his chief reasons for rejecting the measure was, that he did not see why they should ratify a bargain that nobody seemed willing to consent to. He believed that there was a large majority of persons both in that House and out of it, who did not consider the bargain an advantageous one for the country. He might include in the number of those who held such an opinion, even the noble Lord who had brought in the measure. However, he would not have seconded the Amendment before the House, had he found that the great corporation of the Bank were satisfied with the measure. But they were not; at least they publicly said so. For they now thought, that the noble Lord was consenting to an interpretation of their privileges in a way which went to break the bargain as it was originally agreed to. At a meeting last week, the following resolution was come to by the Bank proprietors—they say, "That this Court feels itself bound in justice to its own character, to protest against the treatment it has experienced at the hands of the Chancellor of the Exchequer, who has, in the opinion of this Court, most improperly and unjustly departed from the terms of his own proposition; and after having engaged to grant certain privileges to the Bank, on consideration of stipulated pecuniary concessions, has since determined to withhold from the Bank some of the most important of those privileges, without making a corresponding abatement in the pecuniary concession. That, although this course of procedure, and the violation of the contract, fully justified the Bank in rejecting the arrangement in toto, 767 this Court, considering the extensive injury to the public interest that might be the result, and considering that a new range of prices had been made up in the conviction that the question was settled, is unwilling to assert its undoubted rights at such hazard, and authorizes the Court of Directors to submit to the arrangement." It was quite clear, then, that the Bank did not think it was bound to ratify the bargain now made by the noble Lord. That was at least his view, and he thought the House ought to support that view. The hon. and learned Member opposite (the Solicitor General) had stated the other morning, that, without trenching on the privileges of the Bank, there might be established banks of deposit within sixty five miles of London. He himself was of that opinion, and such he knew was the opinion of several able legal gentlemen; yet the question was doubtful and contested; and he thought the noble Lord would not be doing his duty to the banking interest of the metropolis, or of the country at large, if he allowed the point to remain any longer in doubt. If the Bank thought that Government, in adopting that interpretation, was departing from the original stipulations—and the Bank stated, verbally and in writing, that such was its opinion—the bargain ought not to be forced upon it. The Bank was unwilling to accept it, and said, that the reason why it consented was its care for the public; it did not even use the word consent; but the word submit. Now, he wished to relieve the Bank from all such disinterested care and concern for the public interests, when he asked the House not to force on that much injured body the ratification of the bargain. This coquetry on the part of the Bank proprietors made him still more indisposed to ratify the bargain with them, which bargain he believed advantageous to them, and injurious to the public. He thought the House now could, since the Bank proprietors declared themselves unwilling to accede to the bargain—he thought the House had now an excellent opportunity of departing from the bargain, without any breach of faith towards the Bank. He trusted, that his Majesty's legal advisers in that House would state their opinion how far the privileges of the Bank were interfered with by the clause allowing banks of deposit to be established in London, and within sixty-five miles of it. 768 He had felt much fear before as to the effects of the legal tender clause, and that fear was much increased since he saw that it had already given rise to a mania of speculation. It had raised the prices of all commodities used in the large manufactories. He did not know what the noble Lord meant to say to that part of the Bank Proprietors' Resolution which mentioned a new range of prices. But he knew that the prices of raw material had risen thirty or forty, and, in some instances, 100 per cent—he knew that the hours of labour were being now restricted by manufacturers, and he knew that the consequence would be an increased importation of articles from abroad. As the effect of the measure would be to raise prices, not only at present but for the future, he thought he might safely tell the noble Lord to expect next winter a great change in the commercial transactions of the country, and not to be surprised if his measure should be accompanied by wide-spreading distress. The noble Lord would not relieve any of the evils he apprehended, for one of the great remedies for all the evils of banking, was the immediate convertibility of paper into gold. That ought never to have been lost sight of, and to hold over the head of the Bank the dread of a drain for gold was the only means to make it careful not to put into circulation too many notes. He had, however, one consolation—the Bill was not to come into operation until the year 1834, and he felt convinced that, in the mean time, public feeling would be so strongly pronounced against it, that both the noble Lord, and those with whom he acted, would listen to the voice of the public, and consent to abandon this part of the measure. He solemnly protested against passing it in the present shape, and so far from thinking that to defer the measure would be injurious to the country, he felt sure that to put it off, would be advantageous to the commercial and manufacturing interests of the kingdom, since it would put a stop to that dangerous mania for speculation which he had already alluded to. By this measure faith was broken with the country, since debts contracted in another way were to be paid in paper, and since it would diminish a metallic standard—the only one on which a sound currency superstructure could be raised. He agreed, therefore, with the Amendment of the hon. member for Old- 769 ham, and would vote that the Bill be read a second time that day six months.
§ Mr. Fryer
said, he would not oppose the Bill; but he would recommend his Majesty to provide a considerable issue of silver money in crown pieces, to meet the amount of gold that might be substracted from the country, silver money would be much more convenient than gold for the payment of wages. One effect of the provision which he recommended Ministers to make would be, that if, in consequence of the turning of the foreign exchanges against us, the gold should go out of the country, the silver that would remain would be sufficient to pay the wages of the labourers. The country bankers under such circumstances, would be obliged to get their silver from the branch banks by giving gold for it. The result of the adoption of this plan would be, that in time it would bring about what he thought should be established—namely, a silver tender instead of a gold one.
§ Mr. Herries
would not at this stage of the Bill, and at the present advanced: period of the Session, take up the time of: the House with any lengthened observations on this subject. With respect to the legal-tender clause, however strong his objections, he would not then go into it, seeing that that part of the measure would be open to revision in the next Session of Parliament, on the occasion of the introduction of those parts of the measure which had been postponed till then; and even should such an occasion not arise, if those evils which he anticipated would follow from this legal-tender clause should have come into operation, as he had no doubt they would, he trusted to the good sense and wisdom of Parliament to provide a remedy for them. The House was now called upon to pass an Act of the greatest, importance to this commercial community, He would not say it was unjust towards the Bank, because that Act, if even one of injustice, was not an act of injustice on the part of the House of Commons. He personally felt satisfied, that it was not consistent with the dignity of the House to be parties to forcing upon any body of men an act which that body, reluctantly submitting to it, declared, as they had declared, to be one of injustice. The Bank of England said they submitted most reluctantly, and, at the same time, protesting against the justice of the proceeding; but it was satisfactory that their 770 complaints were not directed against the Commons House of Parliament, but against the noble Lord by whom the bargain with them had been made, and who was stated to have made to them specific promises which the noble Lord had failed to perform. With that part of the question he (Mr. Herries) had now nothing to do, and if he should be satisfied from the answer of the noble Lord the Chancellor of the Exchequer, or the hon. and learned Gentleman near him (the Solicitor General), that there was nothing in the Bill itself, or the clause which had been introduced, at all at variance with the law of the land as it at present existed, he should with perfect satisfaction give his assent to the third reading of this Bill. But the House at present stood in a most unsatisfactory position with respect to the provisions of this Bill, inasmuch as a great diversity and variety of opinion prevailed in the judgments of the most learned persons in the country, who were the most competent to give an opinion upon such a subject. He could not but lament that the Bill and the clause introduced in Committee, not being as yet in print, were not sufficiently circulated or understood by hon. Members. He had himself felt the want of this; but having been supplied with a rough draught of the clause in question, he had been enabled to give it some consideration. On that consideration great doubts had arisen in his mind which he should be glad to have removed, or rather the provisions explained by the law officers-of the Crown. He had looked (and with great respect to the eminent legal opinions which had been given upon it) to the point in issue between the noble Lord the Chancellor of the Exchequer, and the Bank of England—namely, whether the clause which had been inserted coincided with the laws which existed before the introduction of this Bill. Now, as he had read the former enactments, it appeared to him that something was proposed to be granted as a privilege to the Bank of England which the present Bill would have the effect of removing and which it was the intention of the present Bill to prohibit. When he formed this judgment he had looked to the statutes 39th and 40th of George 3rd, and he considered the privilege 771 granted under those statutes to be, as the words of the old Act of William repeated in the subsequent Acts conveyed. "That no other bank or any other corporation, society, fellowship, company, or constitution, in the nature of a bank, shall be erected or established, permitted, suffered, countenanced, or allowed, by Act of Parliament within this kingdom." These words he conceived to be distinct and clear; but if any doubt prevailed, it was solved by the words which followed:—"That it shall not be lawful for any body, politic or corporate, whatsoever, erected, or to be erected, other than the said Governor and company of the Bank of England, or for other persons whatsoever united, or to be united, in covenant or partnership exceeding the number of six persons in that part of Great Britain called England, to borrow, owe, or take up any sum or sums of money on their bills or notes payable on demand, or at any less time than six months from the borrowing thereof." If the clause which had been introduced in Committee went no further than to declare the law as provided by these enactments, and to enable parties in partnership, not under the au thority of Parliament, to do all those things not restricted by these Acts, then he should at once say his opinion fully coincided with that of the framer of the Bill. But in this respect he had great doubts, admitting as he did that he was speaking subject to correction, and without any perfect acquaintance with the Act itself, from the causes he had already mentioned. He was of opinion that the clause in question was at variance with the law as it at present existed. If he was satisfied that no Joint-stock bank, deriving its powers and privileges from Parliament, could be established within sixty-five miles of London, and that bankers only enjoying the privileges afforded by the ordinary law, as associated individuals, embarked in a particular trade or calling, then he should be prepared to admit, that there had been no infringement of the law in the proposed clause as it regarded the Bank of England. He doubted much, however, whether Joint-stock banks might not, under the clause, be established within the prescribed limits. He had felt it his duty to call the attention of the hon. and learned Solicitor General to these points, or he should not have tres- 772 passed upon the attention of the House. He regretted, and he was sure even the noble Lord, the Chancellor of the Exchequer, himself must now entertain some regret, that he had not acceded to the proposition for the appointment of a Committee of the House of Commons, during the present Session, on a question of such vast importance, before he had adopted the final determination of bringing forward this measure. He must observe, that unless these doubts which he had expressed were cleared away and removed from the minds of those who looked upon the question not as partisans of the Bank, but merely with a view that justice should be done on the present occasion, he for one must vote (as we understood) against the Bill.
§ Lord Althorp
, before addressing himself to the objections of the right hon. Gentleman who had last spoken, wished to answer the objections of the hon. member for Oldham. The hon. member for Oldham had assumed that the only object of making Bank of England paper a legal tender was to depreciate the currency. No one would more readily admit than he (Lord Althorp) that such an effect, if it did follow upon this measure, would be a great evil: but as he could not admit the premises of the hon. Member, neither could he admit his conclusions; and his own sincere opinion was, there was nothing in this measure which would have the effect of depreciating the currency. He was sorry to take away the character which the hon. Member had assumed, of being a prophet; but he (Lord Althorp) remembered that the hon. Member, in alluding to a speech delivered in that House by a former Chancellor of the Exchequer, in which he had spoken of the prosperity of the country, had prophesied that, within two years, there would be a convulsion in the country. Now, unfortunately, the hon. Member had made a mistake in the dale, as that speech was made in 1825. There was another prophecy made by the hon. Member of this kind—that if ever the currency ceased to be deficient, or if the monetary system were put upon a right footing, the prophet would allow himself to be burnt upon his own gridiron. Now, according to the hon. Member's own showing, the monetary system had attained the very best footing, so that the prophecy had come to pass. The hon. Gentleman had said, that 773 exchanges could not regulate the currency. Now, he (Lord Althorp) maintained, that if the exchanges had been in proper operation in 1825, the calamities of that year would never have occurred. If, therefore, the experience of those years were quoted, the conclusion to be drawn from them would not be right. He (Lord Althorp) would say, that if the exchanges did not regulate the currency, he did not know what would. He did not think that while the bank-note was convertible into gold at the bank, the making it a legal tender elsewhere could effect a depreciation in the currency. He conceived that the general rise in prices which would undoubtedly follow upon a general depreciation of the currency—for a depreciation of the currency could not take place without a general rise in the price of commodities—a demand would immediately be made for gold at the bank, which would immediately bring things to their former level. He, therefore, conceived, that there was no danger on this account. With respect to the objections brought by the hon. member for the Tower Hamlets, that hon. Member seemed to concur with the hon. member for Oldham in his objections to making Bank of England notes a legal tender in the country; and he also objected to going on with the measure, in consequence of what had taken place at the Bank meeting. He, however, thought that nothing; could be more unwise than for Parliament to act upon anything which had taken place elsewhere, or on any expression made use of in another place, even if it had reference to the dignity of the House itself, and far less if it had merely reference to the acts of an individual Member of the House. There had been a mistake regarding an expression made use of at that Court, on the subject of legal tender, by one of the Gentlemen present. That Gentleman had only said, that legal tender would increase the quantity of paper in circulation. With respect to the expressions made use of at the Bank meeting regarding himself, they had been made use of by persons for whom he felt great respect, and he could not help feeling a regret that they had been spoken; but, believing that they had been spoken in the heat of argument, and recollecting what had been said by the same Gentleman at a subsequent meeting, he (Lord Althorp) did not consider it necessary to take any further 774 notice of them, and he would therefore say no more upon the subject. With regard to the speech of the right hon. Gentleman who last spoke, he could state it as his own opinion—and in that opinion he was joined by his hon. and learned friend the Solicitor General—that any number of parties might carry on business as a banking company, notwithstanding the present Charter. He admitted, that contrary opinions had been given on this subject, of which he had not previously been aware, when he stated that no barrister had given a different opinion from what he then stated. He was certainly mistaken as to the opinion of the hon. and learned member for Norwich upon the subject, and when he found that hon. and learned Member's opinion and that of Sir Edward Sugden, were different from his own, it was impossible that they could not have weight with him. He did not, therefore, wish to rely on his own opinion alone, but he had gone through all the Acts of Parliament upon the subject, in order to make up his mind, if possible, upon the subject, and his conviction now was, that no part of the Clause in question contained any infringement of the privileges which the Bank heretofore possessed. He admitted, however, that he should have been guilty of a breach of faith towards the Bank if the clause took away any right which the Bank previously possessed. The only way in which they could come to a right understanding of this subject was by examining the Acts of Parliament which conferred the right on the Bank. The first Act passed upon this subject said nothing regarding any exclusive privilege whatsoever—it was the second Act which gave to the Bank its exclusive privileges. Now, the question was, what was meant by those exclusive privileges? It was unnecessary for him to tell the House, that in the Act of William 3rd, which is the time when this privilege was given, the company was described as Goldsmiths, not as bankers, and the words of the Act were, that no other Bank should be allowed by Act of Parliament. The provision did not apply, therefore, to private bankers, but to corporate bodies, formed for the purpose of banking. If it had been otherwise, there would not be a private banker in London at this (lay who would not be carrying on his business in opposition to the law, and the consequence of such an interpretation 775 of the Act would be, not only that all private bankers in London, but all private bankers throughout England would be contrary to law. In the first Act, too, there was nothing said of the number of partners; so that if this interpretation were put upon the Clause, not only would all banking establishments consisting of more than six partners be illegal, but every establishment of whatever kind, even if it had only one partner, would be against the provisions of the Act. The number of partners was, in the subsequent Act, limited to six, but the original privileges granted were not touched by it. The only object of the second Act being to prevent companies, consisting of more than six partners, from borrowing, owing, or taking up money. These two Acts were joined by the 39th and 40th George 3rd, which merely repeated the provisions of the former Acts, and brought them together into one Act. The Bank was then to have all the privileges which it formerly had under those Acts, and these merely were that no company consisting of more than six partners, should have a bank of issue; the general term of banking applying at that time only to that species of banking. The effect of their exclusive right would be not only to prevent any Corporation, but to prevent any number of partners, from carrying on a banking company. Now the clause proposed only declared that any number of persons might enter into a partnership together, for the purpose of carrying on a banking concern. The right hon. Gentleman appeared alarmed with the words "Bodies corporate and politic," but there was nothing in this clause which gave greater sanction to these banks than before. He felt that it was very difficult for him to explain his sentiments upon this subject, but he could assure the House, that it was his firm conviction, that the Bank of England would not be deprived of any of its privileges by this clause.
The Attorney General
observed, that the Act of William 3rd was the source of the formation of the Bank of England, and it should not be forgotten what was the state of the law at that period with regard to the business of banking. The first privilege extended to the Bank of England was by the 5th of William 3rd, which imposed the first restrictions upon banking establishments; and he thought that Act would be found to contain 776 nothing more than a parliamentary pledge to erect the Bank of England into a Company, and never to give countenance to any Act by which any other similar body should be erected into a company. Before that Act passed, he thought it was clear that any body, from two to one hundred and upwards, might form banking companies. Now if the construction of the law urged on the other side availed at all, it would interdict private banking just as much as the formation of any company formed of from two, to twenty, or one hundred individuals; but he must maintain, that nothing was given by that Act but a pledge that the Legislature would not pass any Act for the formation of any company to compete with the Bank of England; and he must equally maintain that Parliament had redeemed that pledge. The next statute (the 7th of Queen Anne) recognized, that banking companies existed, and without at all restricting the number of the parties concerned, only deprived them of the power of issuing paper payable on demand. The principle of these three Acts was not departed from in the present Bill, which only limited companies to being banks of deposit.
Mr. Abel Smith
was understood to say, that he was authorized by his friend the Bank Director to whom the noble Lord had alluded to express his regret for the expressions which he had made use of a few days since at the meeting of bank proprietors, though his opinions with respect to the conduct of Government remained unchanged. He himself also wished it to be understood, that upon that occasion he had no intention of saying anything personally offensive to the noble Lord, The bargain between the noble Lord and the Bank was made under the impression that the law was different from what it now appeared to be, and under these circumstances he thought that when the bargain was altered, the Bank ought to have received some compensation for the advantage which they were to be deprived of. The hon. member for the Tower Hamlets had not acted fairly in reading only one of the resolutions agreed to in the Bank parlour, from which the assent given by the Bank to the bargain in its altered form appeared to rest on grounds different from that upon which it really stood. Surely the Bank was not to be condemned for expressing sympathy for the interests of 777 the country generally. The Bank proprietors felt that, whether the measure was good or had for the Bank, it was a matter of the deepest importance to the country, and that its delay would be injurious to the monied interest from one end of the kingdom to the other; and on these grounds the Bank proprietors expressed an opinion that the arrangement should be acceded to.
§ The Solicitor General
said, that after the most deliberate and dispassionate consideration, he was confirmed in the opinion which he had recently expressed. That opinion was wholly unbiassed; and if he had any wish on the subject, it was that he could have concurred in the view which had originally been taken of it. He was decidedly of opinion, that the establishment of joint-stock banks of deposit consisting of more than six partners within sixty-five miles of London, had never been prohibited by law, and that of course they could at any time have been legally established.
§ Mr. Robinson
, in coming to a decision on the question that the Bill be read a third time, would be governed only by considerations of public expediency, without reference to what had recently passed elsewhere. He thought, that the hon. member for Oldham had greatly exagerated the apprehensions which ought to be entertained with respect to the legal-tender clause. If anything like the depreciation of the currency which he anticipated from that measure were likely to occur, the Table of the House would have been covered with petitions, praying that it might be postponed. The question was, whether, after such efforts had been made to bring the measure to maturity, it was desirable now to postpone it without any demand to that effect from the people. What security could the advocates of postponement offer that a more beneficial measure would be brought forward next Session. The only thing which the public could hope to gain by postponement was a better pecuniary bargain but that ought not to be put in competition with the mischief of thus keeping all the great interests of the country in a state of feverish uncertainty. In reference to what the hon. member for the Tower Hamlets had stated as to speculation, he begged to state that speculation had commenced before the Bill was introduced, and originated in causes which had no 778 connexion with the renewal of the Bank Charter. One might suppose, from hearing what had been said on the subject of the legal-tender clause, that it would act like another Bank Restriction Act, whereas, in fact, it would only render it necessary for people in the country to send their notes to London to be exchanged for gold, instead of having them changed upon the spot.
Mr. Alderman Thompson
thought, that when the opinion of two such eminent lawyers as Sir James Scarlett and Sir Edward Sugden was at variance with that of the law officers of the Crown as to the point in dispute between the Bank and the Government, it would have been better to have passed a law to determine a point, rather than to have effected that object by a declaratory clause, as was now proposed.
§ Mr. Matthias Attwood
said, it appeared clearly to him, that much more deliberation would be necessary before this Bill were sent up to the other House of Parliament. Whether the Banking-laws which had previously existed were wise or absurd was not the question now before the House; indeed, under existing circumstances, the great question for consideration was, whether, at this late period of the Session, such a question should have been submitted to Parliament. Taking the conduct of the Government altogether upon this question, it was one of procrastination, danger, and disorder; and in truth there was too much business of serious importance now before the House to admit of this Bill being as fully discussed as it would necessarily be in the course of the next Session. In discussing the question of joint-stock bank companies of deposit in London the opinions of lawyers should not be especially regarded; for in fact, the common sense of bankers, of traders, and merchants generally, could much better decide the question. If lawyers had been consulted before the bargain was made by the Government with the Bank there might have been something in it, but in the present state of the case the opinion of lawyers could be of little or no advantage. The Bank had charged the Chancellor of the Exchequer with a breach of faith in this transaction, and particularly as to making the Bank of England the only joint-stock bank for deposits to vest in the Bank of England. He could not say whether 779 the case exactly stood as it was stated between the Bank and the noble Lord; but if the letter of the noble Lord was to be relied upon as evidence in this case, the noble Lord might plead guilty. A bargain was made by the noble Lord; it was admitted by him; and the only ground upon which he refused acceding to it was, that some previous bargain had been made some thirty years ago upon this subject with which he was not previously acquainted. That, however, could be no answer to the Bank, to whom a positive pledge had been given. Legal subtleties, as he had before said, could have nothing to do with the consideration of this question. It was clear and plain; it was one of justice and honesty; but it was one at the same time, of vital importance, not only to the bankers, but the general commercial interests of the country. The Bank of England had to work great operations either for the good or evil of the country at large; and he hoped that no hasty conclusion would be come to on this most important of all occasions. This was not a question merely affecting the Bank proprietors, but it affected every bargain and sale throughout the whole of the country, and, indeed, the property of the British world at large. This question involved the consideration of the whole of our monetary system, and of the enterprise and industry of the people of this great country. The Bank Directors considered that their system had been the means of conferring great prosperity upon the country: large issues took place from 1823 to 1824 and 1825, and the result was, that speculation and distress followed such over issues. Such a power should not be granted to any body, even though it were as respectable as that of the Bank of England. The question was, no doubt, one of difficulty, but not of such great difficulty that it could not be dealt with by the Parliament of England. The price of Bank Stock had risen; but in what other cases had the prices of other commodities equally risen? The course of the Government was one of vacillation, inconsistency, and disorder; and yet, rather than let things remain unsettled, he would support the third reading of this Bill.
§ Mr. Hume
said, that the speech of the hon. Member was strongly in favour of the rejection of the Bill, although the hon. Member said he would vote for the third 780 reading. He (Mr. Hume) objected to this Bill on two grounds—first, because the Government had made a bad bargain with the Bank; and, secondly, because it would interfere with the currency of the country; and he would further say, that there were so few Members present, that the Bill ought not to pass. To the legal-tender clause he would give his most decided opposition. He had many other objections to the Bill, but, at this period of the Session, he would content himself with making those few observations in opposition to this Bill, which he considered to be objectionable in every possible point of view. No mischief could come from deferring its consideration until next Session.
§ Mr. Hawes
had a most decided objection to the legal tender clause as it existed in this Bill. If it were continued, Bank paper could not be converted into gold, and, above all, small dealings must entirely be carried on in an inconvertible paper currency. If this clause were carried, the inevitable result would be, he was afraid, to have a re-issue of 1l. notes. If the metallic currency were again destroyed, the effect would be, to create at once high prices and high rents. This clause ought to be postponed; it was not necessary; and certainly he would vote against it.
§ A division took place on the Amendment—Ayes 23; Noes 93: Majority 70.
§ Mr. George Wood
would move the insertion of words in this Bill to guard against any claim for compensation on the part of the Bank, if, at any time during the continuance of the Charter, Parliament should think fit to repeal or modify the enactment making the Bank of England notes a legal tender. He would also move the addition of a clause, providing that so long as the Bank of England notes continue a legal tender, the Bank shall be required to continue branch banks for purposes of business at convenient stations in different parts of the kingdom. The hon. Member moved the last Amendment he had described.
§ Mr. Cobbett
seconded the Motion, He observed, that the noble Lord supported the Bill on the ground that it would not occasion a depreciation and rise of prices; he thought it would; the House had voted with the noble Lord, but had done so from taking his (Mr. Cobbett's) view of the subject, believing it would occasion a rise of prices. If the Bill did occasion a rise of prices, it would produce 781 great distress. He wished the House to remember that he opposed this Bill, and that the noble Lord said there would be no depreciation.
Mr. Poulett Thomson
said, that the clause was useless for the object which the hon. Member had in view. He wished to preserve the branch banks, and that the same facility should be afforded by them as now existed. But the clause would not effect that; for all the clause enacted was, that branch banks should exist in certain places. If the Bank found it to be its interest to carry on branch banks, it would do so; if not, in spite of the clause, the branch banks would be merely nominal; the clause did not compel the banks to do business and issue notes for which they would be compelled to give gold. On this ground he objected to the clause. So important did he think the legal tender clause to the Bill, that he should be unwilling to give the monopoly to the Bank, unless it was accompanied by a provision for making its paper a legal tender, which was necessary for the security of a single bank of issue; it was not done for the purpose of introducing a large supply of paper, and least of all a depreciation.
Mr. Alderman Thompson
protested against the Bank being compelled to keep up establishments which the wants of the public might not require, and which might be inconsistent with its own interests.
§ Mr. Matthias Attwood
was of opinion, that the notes of the branch banks ought to be payable in London, otherwise notes issued in any corner of the kingdom would be a legal tender, from York to Cornwall, although only payable at the place of issue—a system that must be attended with great inconvenience.
§ The House divided on the Clause—Ayes 19; Noes 98: Majority 79.
§ Mr. Warburton moved to omit the legal-tender clause altogether. He did so upon three grounds:—The prospect of this clause had already conduced to a rise of prices, and had a direct tendency to increase speculations of every kind; it must in future create great vacillation of prices—in the second place, legal tender dissociated in the feelings of the people the convertibility of paper into sovereigns, and tended directly to get rid of a metallic currency—lastly, the result of the system, if once established, must be an increase of forgery and crime. He was determined 782 to give the House an opportunity of voting against a clause from the adoption of which evils of great magnitude must, in his opinion, inevitably result.
§ Mr. Hume seconded the Motion.
§ The House divided on the Motion—Ayes 35; Noes 82: Majority 47.
§ Bill read a third time and passed.
|List of the AYES.|
|Aglionby, H. A.||Humphery, J.|
|Baillie, F. A.||Jephson, C. D. O.|
|Bewes, T.||Lloyd, J. H.|
|Blake, Sir F.||Morrison, J.|
|Briggs, R.||O'Reilly, W.|
|Brocklehurst, J.||Philips, M.|
|Brotherton, J.||Potter, R.|
|Clay, W.||Pryme, G.|
|Cobbett, W.||Ruthven, E.|
|Divett, E.||Sheppard, T.|
|Ellis, W.||Vigors, N. A.|
|Ewart, William||Wallace, T.|
|Fielden, J.||Waller, J.|
|Forster, C. S.||Williams, Col.|
|Grote, G.||Willoughby, Sir H.|
|Harvey, D. W.||Wood, G. W.|
|Heathcote, J. J.||Hume, J.|
|Howard, P. H.||Warburton, H.|