§ Mr. Humerose, in consequence of the notice which he had given, to move for a select committee to inquire into the proceedings of the commissioners for the reduction of the national debt, the commissioners for the management of Savings-banks, and the Lords Commissioners of the Treasury, with the monies of the Savings-banks, in the years 1836 to 1841 inclusive, by which proceedings a large sum had been added to the national debt without the sanction of Parliament. In the first instance he wished to observe, that his motion did not affect, and was not intended in any way to affect, the property or the credit of the Savings-banks. All he wished was to lay before the House a novel proceeding, novel at least, till within these few years, from which, if it were not checked, much evil would assuredly arise. A power had been assumed by the Chancellor of the Exchequer and the Lords of the Treasury to add as they pleased to the national debt, without coming before that House, as they ought to do, for the necessary authority. Since the national debt was first established, until the year 1836, no power had been assumed by any party to add to the national debt without the sanction of Parliament. But it appeared that between the years 1836 and 1841, the sum of 5,395,569l. had been added to the permanent debt of the country, without the previous knowledge and Sanction of Parliament. Such a thing was never known until the then Chancellor of the Exchequer (Mr. S. Rice) devised this mode to meet the financial exigencies of the day. He held in his hand the act of the 4th George 4th, cap. 92, which was entitled "An Act to Consolidate and Amend the Laws relating to Savings-banks," and in it he found not one word respecting Exchequer-bills, not one word connected with the national debt; 1097 and yet, strange to say, it was under certain of the clauses of that act that the former Chancellor of the Exchequer, with the sanction of the Lords of the Treasury, had increased the national debt without the intervention of Parliament. It would be recollected, that in the year ending the 5th of January, 1837, the surplus revenue was 2,130,092l. In the five successive years, 1838, 1839, 1840, 1841, and 1842, there was a deficit, and the public was very much puzzled to know how the then Chancellor of the Exchequer contrived to carry on the business of the country without coming to Parliament. This remained a mystery until 1838, when he discovered the sleight-of-hand— as he might term it,—the manner in which the Treasury had been recruiting its finances, without paying the compliment to the House of Commons of requiring its authority, without in any respect requesting its sanction for their proceedings. If this power were allowed, why then the Government might raise any sum of money by funding the proceeds of the Savings-banks, which was the course taken, and creating a permanent 3 per cent, debt, without the trouble of coming to Parliament. In the years 1838,1839,1840,1841, and 1842, the Chancellor of the Exchequer borrowed money from the Savings-banks nearly sufficient, with the surplus of 2,100,092l. of the year 1837, to meet the deficit of the revenue. He had found out how the matter was managed. When, for instance, the Chancellor of the Exchequer wanted 100,000l., and there was a deficiency in the revenue, as of late years had generally been the case, he directed the commissioners of the sinking fund to take 100,000l. of the money deposited by the Savings-banks, and to apply that 100,000l. to the purchase of Exchequer-bills. Thus, so many Exchequer-Bills were taken from the Government; and at the end of the quarter the commissioners for the reduction of the national debt were directed to calculate what the current rates of stock were, and to pay over to the commissioners of the Savings-banks the amount borrowed—adding, by this means, to the funded debt of the country 100,000l. The hon. Member then proceeded to enumerate the addition made to the funded debt in consequence of this system, from October, 1836, to April, 1841, amounting to 5,395,569l. 3 per cents., and creating a charge upon the public of 163,940l. annually. The deficit for the years 1838 to 1842, inclusive, amounted to 6,209,120l. If they deducted from that 1098 the surplus of 1837, being 2,130,092l., it would leave a net deficit of 4,079,028l. But the Chancellor of the Exchequer had in that period borrowed from the Savings-banks, through the agency of the commissioners of the sinking fund, and without the sanction or knowledge of Parliament, 4,916,757l., being actually 916,000l. more than the occasion required. The right hon. Baronet the Member for Tamworth had stated that when he came into office the deficiency was 10,000,000l.; but there was no such deficiency. The fact was, that when the late Ministry give over their charge to the right hon. Baronet there was not a single shilling of arrear—all had been funded. When the right hon. Baronet assumed the Government of the country there were no arrears. His object, in making this motion, was not to censure one party more than another. What he contended for was, that Government had no right or power to take such steps as had been taken, in borrowing money from the Savings-banks, and adding to the funded debt of the country, without appealing to Parliament. In 1838, he had brought this subject before the House, and in a series of resolutions, one of which he would read, as it proved that he was perfectly cognizant of the evil which he wished to check. It ran thus:—
That by the existing law the commissioners may buy, sell, and exchange the Government security of the Savings-banks as they may think fit; they may purchase Exchequer-bills, and exchange them for stock; they may sell out stock and purchase Exchequer-bills, thereby affecting materially the currency of the country, and changing the nature of the public debt, without the previous knowledge of Parliament; and it appears they have exercised these powers largely during the last 20 years, having paid 35,355,014l. for the purchase of stock and Exchequer-bills, and received from the sale of stock and Exchequer Bills the sum of 16,684,645refl., leaving 18,670,369l. as the amount of cost of the stock and Exchequer-bills standing in their names on the 20th of November, 1837.The facts which he stated at that time were all admitted, but the time was not considered fit to remedy the evil. In 1838 the hon. Member for Portsmouth (Mr. T. Baring) who was then Chancellor of the Exchequer, admitted that the law was a bad law. He observed that he had found the law, that he had used the law, but at the same time admitted that it was bad. Still, notwithstanding that declarat on the right hon. Gentleman had continued to act 1099 on the same principle. If the matter were not inquired into and checked, the Government might add as much as they pleased to the debt of the country, and set Parliament completely at defiance. He wished for the appointment of a committee, in order, if any error had crept into the mode of managing these funds, that it might be corrected. It had been argued, in opposition to those who objected to the system, that it was beneficial, inasmuch as if the Government were pressed for money, and the facility afforded by the Savings-banks with reference to Exchequer-bills were removed, the public service might be impeded. There were some men who would try any shift rather than proceed in the direct line of honesty; but every wise man would see the propriety of adopting a different line of conduct. The late Chancellor of the Exchequer belonged to a Government that had exceeded their income every year since 1838, and in consequence they had recourse to those schemes and shifts which he so strongly censured. Now in his opinion, an inquiry ought to be immediately set on foot, and a bill afterwards brought in to correct the evil which he had pointed out—the monstrous evil of the Government having it in its power to increase the national debt at pleasure, without applying to Parliament. He was perfectly satisfied, from the manner in which the right hon. Baronet had expressed himself when he brought forward his financial statement, that he would be the last man to have recourse to such expedients for the purpose of raising money, but still he should be very sorry indeed to intrust any individual with the power of doing what had been done—with the power of adding to the funded debt of the country, without making a regular application to the House of Commons on the subject. The hon. Member concluded by movingThat a select committee be appointed to inquire into the proceedings of the commissioners for the reduction of the national debt, the commissioners for the management of Savings-banks, and the Lords commissioners of the Treasury, with the monies of Savings-banks in the years 1836 to 1841, both inclusive, by which, under the act of 9 George 4th, cap. 92, entitled 'An Act to consolidate and amend the laws relating to Savings-banks, the amount of 5,395,569l. of 3 per cent, stock has been added to the national debt, without the previous knowledge or sanction of Parliament.
§ The Chancellor of the Exchequerhad listened to the speech of the hon. Gentleman who had just sat down with great 1100 attention: but he confessed that he did not think that it had assigned any sufficient reason for the House to grant the committee for which he sought. On the contrary, the speech of the hon. Gentleman in itself furnished grounds for resisting the appointment of a committee of inquiry. The hon. Gentleman had stated that a committee was necessary because the law with reference to Savings-banks had left a power to the commissioners for the reduction of the national debt of investing the money of Savings-banks either in Exchequer-bills, or otherwise in the funds, as might seem best for the convenience of the Government. The hon. Gentleman stated that the practice had been opposed by different Gentlemen who filled the office of Chancellor of the Exchequer, and admitting, as the hon. Gentleman did, that the law sanctioned the practice, the hon. Gentleman called for an inquiry into the extent to which it had been carried. But as the hon. Gentleman had admitted that the law sanctioned the proceedings in question, he surely needed no committee to ascertain under what circumstances they had been carried on. And if he objected to these practices, he should have called upon the House at the time when they last took place, or even at a subsequent period, to condemn and put an end to the system. This course the hon. Member had not pursued, and now he had no claim upon the House for a committee of inquiry. If the hon. Member thought the law defective, he should have moved for its amendment, and for the taking away the power of the exercise of which he complained, but to call for a committee of inquiry was certainly a work of superfluity. But the hon. Member would probably say, "You may make an inquiry at once, and you can do no harm by it." But he could assure the hon. Gentleman that it was at all times a delicate matter to create discussion upon. To discuss the investment of the funds of Savings-banks was apt to create in the minds of those who had money invested in them, doubts as to the validity of their security, and, at the present time, especially, that was not desirable, on account of the distress and consequent anxiety which so generally prevailed. He could assure the hon. Member, that since he had given notice of his motion, he had received intimations that there did exist a feeling of anxiety among the holders of those funds, which an inquiry would probably tend to increase, not, indeed, to the injury of the public, but to the individual 1101 injury of those who might have small sums invested in Savings-banks, and who would thus be induced prematurely to withdraw them, and, in consequence, to forfeit the benefits accruing from this species of investment. On these grounds, he would oppose the motion of the hon. Gentleman. He would be most happy to furnish the hon. Member with any information upon the subject which he might wish to obtain, but he must say that the facts relating to the transactions in question had been already detailed, usque ad nauseam. To grant the committee sought for, to allow the hon. Member to go into those minute details which he knew the hon. Member was apt to indulge in, to allow him to examine all sorts of functionaries connected with Savings-banks, was a course to which he would not accede, and which he thought it was his bounden duty, as far as he could, to prevent. The hon. Gentleman had told them of the late excess of expenditure over the revenue, and they had also been told, that that deficiency had been supplied by using the funds of the Savings-banks. He regretted the excess, and he admitted the application of the funds to a certain extent; but upon that subject he had expressed his opinion, when the matter was, upon a former occasion, brought under the notice of the House. He then said, that it was not expedient to raise money, without the Government having obtained the consent of Parliament for the loans in question, and he required no committee in order to form and pronounce an opinion upon such a subject. But he also said then, and he repeated the assertion now, that the transactions in question had no effect upon the security of the money invested in Savings-banks, which was as good as that which every holder of funded; property in this country possessed. They had been told, that everybody had been puzzled as to how these transactions had been carried on, but the mode had been described every year by every person who had taken part in the discussions upon the subject. It was set forth in the returns and documents laid upon the Table of the House, and the hon. Gentleman must have been quite aware of that mode as appeared from his speech upon the question in 1838. The resolution which the hon. Member proposed then had no reference to the point of Government raising money through the medium of Savings-banks, but it referred to the power given to the commissioners of Savings-banks of investing the money under 1102 their charge in the funded and unfunded debt, to the extent of 20,000,000l. Why, in 1838, did not the hon. Gentleman move a resolution condemning the practice of which the hon. Gentleman now complained —a practice which was apparent in the papers of the House? But the hon. Gentleman having omitted that which was the proper course for him to have pursued, of either moving such a resolution, or of bringing in a bill to put an end to the power of the existence of which he disapproved, he now came down, five years after, and stated that nobody knew of what was going on, and that he must have a committee to inquire, at the risk of disturbing the whole Savings-bank system. Thinking, therefore, that there was need for no such inquiry, he should resist the motion of the hon. Gentleman. With respect to the practice complained of, he had already expressed his opinion. He thought that Government should have stated to Parliament that there was an intention of making use of the discretionary power given to it by law, and of raising money by borrowing the funds of the Savings-banks; but that there had been any intention of concealment in the matter he most distinctly denied. The figures and facts of the case were already before the House—there was nothing to be inquired into—and he entreated the House not to grant the committee moved for.
Mr. Baringconcurred with the right hon. Gentleman the Chancellor of the Exchequer, and from the experience which he had had in the Treasury he could bear his testimony to the fact that an inquiry like that which was now moved for could not be carried on without great public inconvenience. Although such inconvenience might be disregarded if it were absolutely necessary that it should be encountered for the purpose of an investigation to find out the truth, yet, in a case like the present, where there had not been the slightest attempt at concealment—where the practices in question were admitted to exist—he did not see the least necessity for an inquiry. Returns relating to the subject had been already laid upon the Table of the House, and if further information were wanted, the right hon. Gentleman the Chancellor of the Exchequer stated that it should be forthcoming. The proper course for the hon. Member for Montrose to have pursued would have been to take away the power of which he complained, and which was admitted to exist under an act of Par- 1103 liament. In fact too the figures and statements of the hon. Gentleman were inaccurate. In framing his motion the hon. Gentleman had confounded operations of different natures. Changing unfunded to funded debt did not give rise to an increase of debt. It did not create new debts; it was merely a change of name. The whole amount of debt actually contracted did not amount to more than 2,500,000l. instead of 5,000,000l. as stated by the hon. Gentleman's motion. It was hardly fair to charge the late Government with anything like secresy in these transactions. Every year regular returns on the subject were laid upon the Table of the House. It was well known that however secret a Minister might be with respect to his intentions, he could not be secret with respect to his acts; and every person who took an interest in the subject had an opportunity from the returns of ascertaining the conduct of Government in the matter. Last year, when he was asked his opinion as to whether the power under discussion should be invested in a Government, he had stated that he conceived it should not be left in the hands of the Executive Government; but he did not want a committee of inquiry to enable him to pronounce such an opinion. Let the hon. Gentleman, if he chose, bring in a bill upon the subject, and he would join in its discussion. But without abandoning his opinions upon the point, he must say that if he came into office and found the discretionary power in question left in the hands of the Executive Government, he had yet to be taught that the Executive should not carry into effect the powers which by law belonged to it, whatever might be the opinion of individual Members of that Executive with respect to the propriety of its being invested with those powers. If every official connected with the revenue, from the Chancellor of the Exchequer to the Custom-house officer, were to consider and debate upon the propriety of the powers delegated to them, instead of putting them into operation, they would soon make a pretty mess of the collection of the revenue. He had heard with much satisfaction, and he quite agreed in the statement, that, whatever opinion might be entertained with reference to the expediency of the practices under discussion, there was no doubt that nothing irregular had taken place with respect to the funds, and that nothing had been done which tampered with the security of the funds of Savings-banks, or which would tend to 1104 place them in a less advantageous position than that which they at present occupied.
§ Mr. W. Williamsremarked that the practice under the notice of the House had been condemned by both the right hon. Gentlemen, the present, and the late Chancellor of the Exchequer. The proper course would, therefore, be to introduce a bill doing away with the discretionary power held by the Chancellor of the Exchequer. It was not similar to any power exercised by any individuals in this country with the exception of that enjoyed by the Poor-law commissioners. The Government could convert the funds of Savings-banks into Exchequer-bills whenever it pleased, or could convert them into stock, and by means of this system they could neutralise the power, constitutionally enjoyed by the House of Commons, over the expenditure and monetary system of the country. He had given notice at the close of last Session that he would bring in a bill to do away with the system under discussion, for he believed that many of the evils which at present were pressing upon the country, had their origin in this tampering with the currency between the Chancellor of the Exchequer for the time being, the commissioners of Savings-banks, and the Governor and Company of the Bank of England, who could withdraw or put into circulation enormous sums of paper money. These agents, he believed, were at present at work, and he was most anxious that the power of meddling with the Savings-banks by the Executive should be put an end to. He had been prevented from bringing forward the bill of which he had given notice by the extent and importance of the public business which had been under consideration this Session; but if the hon. Member for Montrose did not bring in a bill next Session, he would pledge himself to introduce a measure to take away from the Chancellor of the Exchequer the power of meddling with the stock of the Savings-banks without the concurrence of Parliament. Such, he thought, the best course which could be pursued.
§ Mr. Humewould take the sense of the House upon his motion. If there was nothing wrong to be exposed, what could they fear from an inquiry? The manner in which Exchequer-bills were managed was not, he suspected, altogether blameless, and if they gave him his committee, he would prove that there existed partialities as regarded their issue. What he wished to destroy was the power of adding 1105 to the permanent debt of the country without the consent of the House of Commons.
§ The House divided:—Ayes, 34; Noes, 173: Majority, 139.
| List of the AYES. | |
| Aglionby, H, A. | James, W. |
| Bowring, Dr, | Johnson, Gen. |
| Bryan, G. | Leader, J. T. |
| Butler, hon. Col. | Martin, J. |
| Byng, rt. hon. G. S. | Morison, Gen. |
| Callaghan, D. | Muntz, G. F. |
| Clements, Visct. | Murphy, F. S. |
| Corbally, M. E. | O'Brien, J. |
| Crawford, W. S. | O'Connell, M. J. |
| Dennistoun, J. | O'Connell, J. |
| Dundas, Adm. | Plumridge, Capt. |
| Elphinstone, H. | Somerville, Sir W. M. |
| Esmonde, Sir T. | Thornely, T. |
| Fielden, J. | Wallace, R. |
| Forster, M. | Wood, B. |
| Gibson, T. M. | |
| Gore, hon. R. | TELLERS. |
| Greenaway, C. | Hume, J. |
| Hindley, C. | Williams, W. |
| List of the NOES. | |
| Acland, Sir T. D. | Damer, hon. Col. |
| A'Court, Capt. | Darby, G. |
| Arbuthnott, hon. H. | Denison, J. E. |
| Arkwright, G. | Denison, E. B. |
| Ashley, Lord | Dickinson, F. H. |
| Baird, W. | Divett, E. |
| Balfour, J. A. | Douglas, Sir H. |
| Bannerman, A. | Douglas, Sir C. E. |
| Baring, rt. hn. F. T. | Duffield, T. |
| Barnard, E. G. | Dugdale, W. S. |
| Beckett, W. | Duncan, G. |
| Beresford, Major | Duncombe, hon. A. |
| Bernal, R. | Dundas, D. |
| Boldero, H. G. | Du Pre, C. G. |
| Botfield, B. | Easthope, Sir J. |
| Brotherton, J. | Ebrington Visct. |
| Buckley, E. | Egerton, W. T. |
| Buller, C. | Egerton, Sir P. |
| Burrell, Sir C. M. | Eliot, Lord |
| Busfeild, W. | Escott, B. |
| Byng, G. | Estcourt, T. G. B. |
| Campbell, A. | Farnham, E. B. |
| Carew, hon. R. S. | Ferrand, W. B. |
| Cartwright, W. R. | Fitzroy, Capt. |
| Cavendish, hon. G. H. | Flower, Sir J. |
| Chapman, B. | Ffolliott, J. |
| Childers, J. W. | Forbes, W. |
| Clerk, Sir G. | Fox, C. R. |
| Clive, E. B. | Fuller, A. E. |
| Cochrane, A. | Gaskell, J. Milnes |
| Codrington, C. W. | Gladstone, rt. hn. W. E. |
| Colborne, hn. W. N. R. | Gladstone, T. |
| Compton, H. C. | Glynne, Sir S. R. |
| Corry, rt. hon. H. | Gordon, hon. Capt. |
| Courtenay, Lord | Gordon, Lord F. |
| Craig, W. G. | Gore, M. |
| Cresswell, B. | Gore, W. O. |
| Cripps, W. | Goring, C. |
| Goulburn, rt. hon. H. | O'Brien, A. S. |
| Graham, rt. hn. Sir J. | Ord, W. |
| Greenall, P. | Packe, C. W. |
| Greene, T. | Paget, Col. |
| Grogan, E. | Pakington, J. S. |
| Halford, H. | Palmer, R. |
| Hall, Sir B. | Palmer, G. |
| Hamilton, W. J. | Parker, J. |
| Hamilton, Lord C. | Patten, J. W. |
| Hampden, R. | Peel, rt. hon. Sir R. |
| Hardinge, rt. hn. Sir H. | Philips, M. |
| Hardy, J. | Pigot, Sir R. |
| Heathcote, G. J. | Ponsonby, hon. J. G. |
| Henley, J. W. | Praed, W. T. |
| Herbert, hon. S. | Pringle, A. |
| Hervey, Lord A. | Repton, G. W. J. |
| Hodgson, F. | Rolleston, Col. |
| Hodgson, R. | Rushbrooke, Col. |
| Hogg, J. W. | Russell, Lord J. |
| Hope, hon. C | Scarlett, hon. R. C. |
| Howard, hn. C. W. G. | Shaw, rt. hon. F. |
| Hussey, T. | Sheil, rt. hon. R. L. |
| Hutt, W. | Sheppard, T. |
| Inglis, Sir R. H. | Smith, rt. hn. R. V. |
| Irving, J. | Somerset, Lord G. |
| Jackson, J. D. | Stanley, Lord |
| Jolliffe, Sir W. G. H. | Stuart, Lord J. |
| Jones, Capt. | Strutt, E. |
| Knight, H. G. | Sturt, H. C. |
| Labouchere, rt. hn. H | Sutton, hon. H. M. |
| Langston, J. H. | Tancred, H. W. |
| Lascelles, hon. W. S. | Taylor, T. E. |
| Lawson, A. | Towneley, J; |
| Lefroy, A. | Trevor, hon. G. R. |
| Legh, G. C. | Trollope, Sir J. |
| Litton, E. | Trotter, J. |
| Lowther, J. H. | Turner, E. |
| Mackenzie, T. | Vere, Sir C. B. |
| Mackinnon, W. A. | Vesey, hon. T. |
| M'Geachy, F. A. | Waddington, H. S. |
| Marsham, Visct. | Wall, C. B. |
| Masterman, J. | Walsh, Sir J. B. |
| Miles, P. W. S. | Wilbraham, hon. R. B. |
| Mitchell, T. A. | Wodehouse, E. |
| Morgan, O. | Wood, G. W. |
| Morris, D. | Wrightson, W. B. |
| Mundy, E. M. | Wyse, T. |
| Napier, Sir C. | TELLERS. |
| Newport, Visct. | Fremantle, Sir T. |
| Northland, Visct. | Baring, H. |