PUBLIC WORKS, EXCHEQUER BILLS. (Hansard, 30 March 1840)

§ The Chancellor of the Exchequer
stated, that it became necessary for him to ask the House for a further sum to carry on the Public works, as sanctioned by the Public Works Act. The sum at the disposal of the commissioners of public works in Ireland was exhausted; and as it was desirable that no delay should take place in the completion of those works, more 246 particularly with respect to the erection of workhouses in Ireland, he took the earliest opportunity of placing further funds at their disposal. The sum required for Ireland would be considerable, and that, of course, made the present motion larger than it otherwise would be. The right hon. Gentleman moved as a resolution, "That her Majesty be enabled to direct Exchequer bills to the amount of 1,200,000l. to be issued to the Commissioners of Public Works, to be advanced by them towards the completion of the public works in Ireland, and for the encouragement of fisheries, and the employment of the poor, and that security for the repayment of the same shall be given on the Consolidated Fund."

§ Mr. Hume
wished to have an account of what had already been done by the commissioners. He did not understand what was meant by the encouragement of fisheries, and should like to have that explained. He thought that no money ought to be supplied by the public for undertakings for which private capital should be furnished.

§ The Chancellor of the Exchequer
said, that if his hon. Friend would move for the information he required, it should be produced.

§ Mr. Goulburn
would not offer any opposition to the motion, because Parliament having determined that a certain number of poor-houses should be built in Ireland, it was not competent for the House to refuse the sum necessary for that purpose. With respect to the former advances for public works, he had no hesitation in admitting that those sums had been very beneficially employed, and by no means disadvantageously so as regarded the pecuniary interests of the public. But he was anxious to obtain from the Chancellor of the Exchequer some assurance that this grant would not be adding permanently to the unfunded debt. The funded debt had, through the medium of these advances, been for a number of years gradually increasing, till it arrived at an amount extremely inconvenient indeed. He wished to impress on the right hon. Gentleman the necessity of making some arrangement, by which the money granted for the repayment of these Exchequer bills would be strictly applied to the redemption of the Exchequer bills as they became due, and not appropriated to the general account.

§ The Chancellor of the Exchequer
thought the right hon. Gentleman could not be aware of the present course, that was taken with respect to Exchequer bills. During the last three years arrangements had been made by which the money granted for the repayment of Exchequer bills was applied strictly to that purpose. The old practice of raising a loan was by the issue of Exchequer bills; but that practice had been abandoned, and during the period he had mentioned the money had been applied in canceling the bills as they became due.

Mr. Williams
asked the Chancellor of the Exchequer, what rate of interest was paid on the bills.

§ The Chancellor of the Exchequer
replied, that 2¼d. a day was the interest paid, being somewhere about the rate of interest at the present time.

Mr. Williams
said, that 2¼d. a day interest was a higher rate than was at the present time charged by monied men. He saw no reason why a higher rate of interest should be paid on the unfunded debt than on the funded debt.

§ Mr. Hume
said, 2¼d. a day interest was 3l. 16s. per cent, per annum, and that was more than the fund realised. The interest on Exchequer bills always used to be lower than the current interest of the money market until the predecessor of the right hon. Gentleman overstocked the market with bills; and he thought the raising of the interest was a clear proof that the right hon. Gentleman himself had a greater number of bills in the market than he ought to have. The present grant would increase the evil. His opinion was, that the interest on Exchequer bills was too high.

§ The Chancellor of the Exchequer
was the last person to wish to pay a rate of interest beyond what he thought was right and safe under the circumstances of the case. He admitted, that the interest on Exchequer bills was somewhat higher than the rate of interest on the funds, but he did not think that that difference was so much in consequence of the great number of bills in the market as in consequence of the attempts made to cut down the interest of money to too low a rate.

§ Mr. Kemble
suggested, that the time for which the Exchequer bills should run should be shortened, and made payable quarterly. At present many persons objected to take them as security, because 248 they were not readily available for the payment of Government duties, in consequence of the length of time they had to run.