§ The House having resolved itself into a Committee of Ways and Means,
§ The Chancellor of the Exchequerrose and said: Sir, when it fell to my lot, in the course of the last Session, to make a statement of the financial condition of the country, I was listened to with great, though undeserved, kindness and attention. That indulgence I could only attribute to the consideration shown to one who, for the first time, undertakes such a task, and enters upon his duties as Minister of Finance under most arduous and peculiar circumstances. On the present occasion, I am aware that I cannot advance any claims to a similar indulgence. I know it will be justly considered that if, in the interval that has since passed, I possess and have exerted diligence to seek, and industry to arrange, the materials necessary for a financial statement, I ought now to come before the House fully prepared for the performance of this important duty. While I admit the justice of this principle as swaying the minds of those whom I address, I cannot but feel that this conviction still increases my embarrassment. I have, however, one encouragement. In the statement which I am about to make I am assured of the facts of the case; and if I should be able to lay that statement before the Committee in a simple and intelligible manner, though I cannot offer any greater claims to its attention than the patient industry with which I have collected my materials, and the clearness with which I state them, I feel confident that I shall be as able as I shall be ready to explain any points on which explanation may be required. The course which I propose to pursue on this occasion is—to state, first, the income and expenditure of the last, and the anticipated income and expenditure of the present year; and, secondly, to refer to the comparative amounts of the revenues of the Customs, Excise, Stamps, Post-office, and Taxes, in the two years; and to conclude by making such general observations—and they shall be as few as circumances will permit—as will indicate the internal state of the country. Having given such explanations, it will become my duty to show in what manner I am prepared to deal with any surplus that may be at the disposal of the House, and what are the taxes which I propose as subjects of modification, reduction, or repeal. The difficulties with which I have to deal in this latter part of my task are demonstrated by 636 the multitude of petitions for the repeal of taxes which have been presented to this House from all parts of the country. I dare not attempt to enumerate them, but I believe I am correct in stating that there is scarcely one existing tax for the repeal or reduction of which petitions have not been presented. I am sorry to be compelled to state that the finances of the country do not admit of a compliance with the prayer of very many of these petitions. It will be for the House to consider, in the first place, what is the amount of surplus revenue, after all the exigencies of the year have been provided for; and next, how that surplus can best be applied, and what tax it may be most expedient to repeal. It is admitted by one who is well acquainted with politics and mankind, that "to tax and to please, as to love and to be wise, is not given unto man." I must add, that the difficulty of imposing taxes is not so great as that of repealing one previous taxation. In proposing a new tax, there is generally only one class of objectors—that class whom the tax more particularly affects; but when we come to propose a repeal of a tax, then various contending classes of the community come forward, each prefers its particular claim for relief, and the conflict is fierce and formidable. We see the agriculturists arrayed in argument, though I hope not in interest, against the manufacturers; the manufacturers, in their turn, claiming relief in preference to the landholder; the inhabitants of cities and towns asserting that they bear the chief burthen of direct taxation, and are entitled to immediate attention; the trader and manufacturer soliciting the remission of those duties which repress the productive industry of the community. In a word, it is when we come to consider the repeal of a tax, that the great difficulty of finance appears. On former occasions, in financial statements it was usual—and I think it was prudent so to do—to refer to the financial transactions of past years, and to show the effects of former reductions and economical resources. I will not go over ground which I have already trod for this purpose. It is true that our duty should lead us to consider the reduction of expenditure, before we come to the reduction of taxation. Such reduction of expenditure is one of the first duties of a Government, and on it the repeal of taxation can most safely be based. I will not, I repeat, trouble the House, by re- 637 ferring to the reductions made by the present Government, and that of Lord Grey in former years. These I have stated on former occasions, and I presume that those statements are still in the recollection of the House. The reductions made by the Whig Ministry are, I trust, at least, in the recollection of hon. Members on this side of the House, and cannot be undervalued even by those who are opposed to us. But there has been presented to Parliament, during the present Session, one document to which I cannot avoid adverting. It is a Return that has been laid on the Table of the House, not on my motion, and, therefore, it cannot be considered as prepared for the occasion; the Return I allude to was made on the motion of the hon. and and gallant Member for the city of Lincoln. I thank him for the evidence he has supplied—for the opportunity he has afforded me of calling the attention of the House to the facts contained in that most important account. I do not advert to it as claiming, for my side of the House, the exclusive merit of the reductions there shown; for I admit that hon. Gentlemen opposite are fully entitled to their share of the public approbation. Again thanking the hon. and gallant Officer for the opportunity he has afforded me, I proceed to call the attention of the House to some important general results. It appears from the Return, which I hold in my hand, that in the year 1815, the establishment of the several public departments consisted of 27,365 persons, whose salaries amounted to 3,763,300l. In the year 1835, the number of persons employed in the same departments had been reduced to 23,578, and the salaries to 2,786,000l.; showing a reduction of 3,797 in the number of persons employed, and a reduction of salaries to the amount of 976,000l. Though I do not mean to enter into any minute analysis of this account, I may be allowed to point the attention of the Committee to the several departments in which the most considerable reductions have been made. In the Treasury, the annual reductions have amounted to 27,000l.; and by a Bill which was brought in under Earl Grey's Government, of which my right hon. Friend, the Member for Cumberland, had the charge, a further annual reduction has been made in the charge of the Exchequer, to the amount of 58,000l. In the War-Office the reduction has been 638 29,000l.; in the Ordnance, 122,000l., in the Admiralty and Navy Offices, 30,300l.; in the Excise, 152,000l.; in the Stamps and Tax-Office, 1,031l.;; in the Audit-Office, 54,000l.; in the Vice-Treasurer's Office, (Ireland,) 23,000l. I do not mention this with the view of showing that all has been done in the way of reduction which can be done; on the contrary, I do it for the purpose of showing to the people of this country, that much has been already effected, and to encourage the House and the Government, the one to demand and the other to carry into effect, all practicable retrenchment, seeing that what has been already done in that way, has been effected without any detriment to the public service. But I hope, however, the House will see that the more that has been done in the way of reduction, the more difficult is it to effect what yet remains to do. The Government do not mean to shrink from this difficulty; and if any further reductions in the public departments, in the collection of the revenue, or in any branch of the public service, can be carried forward, the House may depend upon it that they will be effected. I now proceed to the detail of the income and expenditure; and, in the first place, to compare the estimate I made in August last, of the income of the present year, with the actual receipts of this year, closing with the 5th of April last. I do not adopt this course from any personal motive, or to claim any credit for the accuracy of my calculations; but it is necessary that the House should know whether the statements I then made are proved to have rested upon sufficient data, and were not lightly hazarded; in order that the public may judge how far they can rely on the probable accuracy of my future calculations, and on the estimate I form of the income and expenditure of the current year. I last year estimated the amount of the Customs' revenue of this year at 20,000,000l. The receipt has been no less than 20,550,000l.; thus exceeding my estimate more than 500,000l. The Excise was estimated at 13,270,000l.; the receipts amount to 13,440,000l.; making an increase of 170,000l. in that branch. I estimated the Stamps at 6,980,000l.; the Exchequer payments have been 7,051,000l.; making an increase beyond my estimate of 71,000l. The Post-Office revenue I estimated at 639 1,500,000l.; but the increase exceeds that estimate by 51,000l. Taxes I estimated as likely to produce 3,600,000l.; excess beyond that sum is 20,000l. The Miscellaneous Estimates have fallen short by 24,000l. of what I had anticipated. Thus, on the whole year, the receipts have exceeded the estimate by the sum of 830,000l. I have made this statement to show, that if I calculate the revenue of the next year on the same data, the House may not suspect that I take an exaggerated view of our present and future resources. I hope, then, that assuming the present state of the country to continue undisturbed—and on this subject I shall make some remarks hereafter—the Committee would not be in error in giving credit to the estimate I am about to state for the next year. I shall now proceed to compare my estimate of the expenditure of the year with the actual payments. I calculated the charges on the Consolidated Fund, and the interest of the public debt, exclusive of the West-India compensation, at 30,580,000l.; but the actual expenditure has been 30,714,000l.; making an excess beyond the estimate, of 134,000l.; the whole of which excess is capable of explanation. The estimated expense of the army was 6,189,000l.; the actual expenditure was 6,481,000l.; being an excess, above the estimate, of 292,000l. This excess arose out of the fact, that the payments made within the year are not always payments for the service of the year. Sometimes there is an overlapping of last year's vote to be defrayed; and at others there is an anticipation of the expenditure of the year ensuing. Since 1831, also, there have been no votes for army extraordinaries—a change which has been of considerable public advantage, and which has brought the whole financial accounts more minutely under the consideration of the House; but in consequence of this change, it sometimes becomes necessary that advances should be made for civil purposes out of the military chest in the colonies, to be repaid out of the miscellaneous vote; and this makes the expenditure of the military department appear greater than it really is. For instance—an advance has been made out of the military chest in the last year for the maintenance of convicts in New South Wales; but this sum will hereafter be re-paid out of the votes for convict purposes, But to proceed: the estimated expense 640 of the navy last year was 4,245,000l., but the actual expenditure has been within that sum by 4,099l. The estimate for the Ordnance was 1,296,000l.; the expenditure has been 1,273,000l., the expenditure being less than the estimate by the sum of 23,000l. The estimate of the miscellaneous expenditure was 2,405,000l.; the actual expenditure does not exceed 2,202,000l. On the whole of the expenditure there has been an excess above the estimate of 80,000l. Such is the comparison between the estimated income and expenditure of last year, and the actual result of both in that year. I will now proceed to make a comparison of the receipts of last year, with the estimated receipt and expenditure of the present, still excluding the charges incurred by reason of the compensation to the owners of slaves. I have already shown that the receipts of last year amounted to 46,381,000l. I am enabled to calculate, and I hope I shall be able to justify the estimate, that the income of the present year, supposing that no alteration were made in taxation, would amount to 46,980,000l., showing an excess in the income of the present, as compared with the last year, of 599,900l.; or, in round numbers, 600,000l. The charge on the Consolidated Fund, and the interest of the National Debt, amounted last year to 30,714,000l. I estimate the amount this year at 30,620,000l., exclusive of the West-India loan in both cases. The army expenditure last year was 6,481,000l.; in the present year I estimate it at 6,327,000l. The navy last year was 4,098,000l.; this year, from political reasons which my noble Friend, the Secretary of State, has explained on former occasions to the House, there has been an increase in the navy to the amount of 434,000l.; thus raising the estimate of the year to 4,532,000l. The Ordnance Estimate last year was 1,273,000l.; in the present I estimate it at 1,263,000l. Last year the miscellaneous services amounted to 2,202,000l.; this year I estimate that branch of expenditure at 2,461,000l. This will show an increase of 420,000l., (exclusive of the West-India loan) on the expenditure of the whole year. I shall now endeavour to combine the results of the statements I have made, so as to bring the whole into the simplest and most intelligible form. The total income estimated for 1836 and 1837, was 46,980,000l.; the total expenditure for debt and other 641 charges on Consolidated Fund, exclusive of the charge for West-India Loan, 30,620,000l.; the supplies for 1836 and 1837, 14,585,807l.; total expenditure, exclusive of charge for West-India Loan, 45,205,807l.; exhibiting a surplus of 1,774,193l. Gentlemen who have listened to this statement will no doubt rejoice—no one could desire more sincerely than myself—that such a disposable surplus existed. But such is not the case. The Legislature, having performed a great act of justice in providing compensation for the owners of the emancipated slaves, it has added 20,000,000l. to our debt, and it cannot have provided for the interest on the sum due to the planter, and at the same time have so large a surplus of revenue applicable to relief from taxation. With respect to the West-India Loan, I have, on various occasions, stated the liabilities which it has entailed on the country; and the right hon. Gentleman, the Member for the University of Cambridge, will recollect that in the course of last year, when he asked some questions concerning it, I gave him an account not only of our full liabilities, but of the amount we might be called on to pay in the course of the year. On that occasion, I stated, that if the whole amount were to be called for within the year, so far from there being any available surplus, there would be, on the contrary a deficiency. But I also stated, on that occasion, (and the House seemed to be satisfied with the declaration,) that I should make provision only for what were likely to be the probable demands upon the public. It was after making such provision, that I struck my balance, and stated the surplus which might be brought under the consideration of the House, with a view to the repeal of taxes. I mean to pursue the same course on the present occasion. The House is aware, that provision is yet to be made for compensation to the slave-owners of the Mauritius, and of the Cape of Good Hope; and that there further remains unsatisfied the difference between the sum of 15,000,000l., the nominal amount of the loan, and the actual amount received after deducting the discount. There is, also, a certain proportion of interest on claims not as yet admitted to adjudication. The maximum amount to be provided for, supposing the loan of the Mauritius and the Cape to be completed—supposing all demands liquidated, including the interest 642 on claims outstanding for adjudication, as well as on those which have not, as yet, been put in—supposing, in fact, that whole interest were to be cleared up and paid off, in full, the utmost amount claimable in the year would be 1,454,604l. On the best consideration which I can give the subject, the actual payment which will be demanded, on the score of interest, I calculate to be 1,111,863l.; and I propose out of the surplus of 1,774,193l.; to make provision for this sum of 1,111,863l.; which I have every reason to believe will be the highest amount that can be demanded. I am thus bound to state, that the whole amount of surplus, over which Parliament is entitled to exercise any dominion, amounts to a sum not exceeding 662,330l. Gentlemen who think that we can apply a large surplus to the reduction of taxation, will do well to bear in mind this fact; they will be pleased to remember, that making a just provision for the engagements and services of the country, we cannot have a larger disposable surplus than 662,330l. Having said this much, I shall now call the attention of the House to the various branches of the income of the country, in order to enable the House to judge whether the calculations I have made are correct. I first examine the Customs' revenue, which I have calculated as likely to produce the same amount as the previous year. Let us consider the consumption of coffee, and the revenue produced from that article. The quantity which I last year estimated was 23,143,000 lbs.; but the actual amount of the year's consumption was 23,623,000 lbs. The consumption which I estimate for the year 1837 is 23,251,000 lbs. This I take as the average of the two years. In the article of sugar, I estimated, in 1835, the consumption for 1836 at 3,726,000 cwts.; the actual consumption has been 3,745,000 cwts. I assume the probable consumption of this year to be the same as the last. I estimated the consumption of tea at 36,000,000 lbs.; the actual consumption has been 37,099,000 lbs. The consumption of the year 1836 and 1837 I calculate at 38,000,000 lbs. This is an increase on which I trust that I am justified in reckoning; it is founded on the very considerable increase which has taken place in the consumption of that article. I am well aware, that, in discharging this branch of his duties, the Finance Minister is bound to avoid all exaggerated statements; and however great the desire on the part of that 643 Minister to reduce taxes—as prudence demands that he should not justify such a proceeding by an over-statement of the probable future income of the country, so he is bound neither to gratify himself nor his friends by a proposition to repeal taxes, which the result may not enable him to realize. I shall next call the attention of the Committee to a more general view of the Customs' duties, as an indication of the general state of the commerce of the country; but I must caution the Committee against allowing the present condition of that commerce to betray them into any excess of confidence. I am well aware that nothing is more dangerous to a community like our's than the speculation and rashness which arises from a misplaced confidence in the continuance of a period of almost unexampled prosperity; it therefore requires the greatest caution and prudence in touching upon this subject. In making a statement of the finances of the country, I hope I may neither depart, nor encourage others to depart, from that calm and patient anticipation of futurity, which it behoves all, and more particularly a Finance Minister, to adhere to. This caution
| Imports and Exports in the last Eight Years, at official Rates, and at declared Value. | |||||
| YEARS | Value of Imports into the United Kingdom. | Value of Exports From the United Kingdom. Official Rates. | Value of the Produce and Manufactures of the United Kingdom, exported, according to the real or declared value. | ||
| Official Rates. | Produce and Manufactures of the United Kingdom. | Foreign and Colonial Merchandize. | Total Exports. | ||
| 1828 | 45,028,805 | 52,797,455 | 9,946,545 | 62,744,000 | 36,814,176 |
| 1829 | 43,981,317 | 56,213,041 | 10,622,402 | 66,835,444 | 25,830,649 |
| 1830 | 46,245,241 | 61,140,864 | 8,550,437 | 69,691,302 | 38,251,502 |
| 1831 | 49,713,889 | 60,683,933 | 10,745,071 | 71,429,004 | 37,163,647 |
| 184,969,252 | 230,835,293 | 39,864,455 | 270,699,750 | 148,059,974 | |
| Average | 46,242,313 | 57,708,823 | 9,966,113 | 67,674,937 | 37,014,993 |
| 1832 | 44,586,741 | 65,026,702 | 11,044,869 | 76,071,572 | 36,444,524 |
| 1833 | 45,952,551 | 69,989,339 | 9,833,753 | 79,823,093 | 39,667,347 |
| 1834 | 49,362,811 | 73,831,550 | 11,562,036 | 85,393,587 | 41,649,191 |
| 1835 | 48,911,542 | 78,376,731 | 12,797,724 | 91,174,456 | 47,372,270 |
| 188,813,645 | 287,224,322 | 45,238,382 | 332,462,208 | 165,133,332 | |
| Average. | 47,203,411 | 71,806,080 | 11,309,595 | 83,115,552 | 41,280,833 |
| Increase on Comparison of two averages. | 961,098 | 14,097,257 | 1,343,482 | 15,440,615 | 4,265,840 |
§ more particularly applies to the commercial public. Whilst we look at the prosperous state of the commerce of the country, we should also observe the signs of the times: the public should not be led away by a knowledge of our present prosperity, to embark recklessly in inconsiderate schemes and wild speculations, such as we see in the present day multiplying around us, not only in the metropolis, but in every city, town—I might almost add, in every village,—of the kingdom. Having given this caution, I will now proceed to remark upon the principal points which indicate the state of the commerce of the country, and for which I think we have reason to be grateful. I hold in my hand a paper which exhibits a comparative state of the trade of the country, from the year 1828 to the ea r 1831, and from the commencement of 1832 to the close of 1835. I beg the attention of the Committee to this document, which shows the official value of the imports, distinguishing the produce of the United Kingdom from that of our colonies and of foreign countries. I shall afterwards have occasion to refer to the declared value of our imports and exports.
645§ On former occasions, when the Returns of official value were referred to, we frequently heard a fallacious but a popular objection raised to our statements. We were told that we only proved an increase of quantities, and that an increase of quantities might take place contemporaneously, with a fall in prices, and with a losing trade. I do not stop to expose this fallacy, but I may be permitted to observe, that the accounts before me not only exhibit a large increase in quantity,