§ House in Committee on Railways, Piers, and Harbours (Ireland).
§ The CHANCELLOR OF THE EXCHEQUER
said, that it might be in the recollection of hon. Gentlemen, who did him the honour of listening to what fell from him, when the noble Member for Lynn brought forward his proposition with respect to Irish railways, that he did not then express any opinion adverse to the construction of railways in Ireland. On the contrary, he had expressed an opinion that their construction would be beneficial; but he felt bound to oppose the indiscriminate and extensive assistance which the noble Lord proposed to afford them. Moreover, he did not think it expedient to go beyond the necessity of raising, as he had felt it his duty to raise, a large loan applicable to the relief of the existing distress in Ireland, and to propose a further loan of 16,000,000l. The proposal he was about to submit to the House, was based on a different principle from that of the noble Lord. He did not propose to advance any sum of money to any railway in lreland, which was not in a condition, according to the terms of its Act of Parliament, to borrow. The advances and repayments would be made according to the same conditions as had on other occasions been settled by the Loan Commissioners, who, out of the funds at their disposal, year by year, had been in the constant habit of making advances to railways, if satisfied of the security and of the repayment of the money. In the present state of Ireland, it was impossible to deny that by this course the greatest impetus might be given to employment where the advances could be safely made. Accordingly, he found that the Loan Commissioners had agreed, from the fund usually placed at their disposal, to make small loans to railway companies; but, looking to the advances which it might be necessary to make for fever hospitals, in addition to other advances which might be required for some of the workhouses in Ireland, he was anxious that no very large sum should be drawn for the purpose of railways from the money at the disposal of the Loan Commissioners. Therefore, when the Commissioners reported to him that there was a railway line which they thought exceedingly advantageous to the country, and with respect to which they were of opinion that the advance of money would be safe, and ought to be made, and would have 1421 been made by themselves, without reference to him, if they had been in possession of sufficient funds of their own; and that the parties applying for a loan had engaged to make calls for the purpose of raising a sum of money of their own of precisely the same amount as the money lent them—he thought that in reference to the extent to which he proposed to go to-night, he should not only not run any risk, because the security was safe, but that it would be unnecessary for him to confer any powers of borrowing on the railway companies which they did not already possess. The railways to which he proposed to lend money having paid up 50 per cent of their capital, were in a legal condition to borrow. Under these circumstances, he thought that it would be advantageous to make a loan of limited extent to them—the loan not to exceed 620,000l. The first line to which he proposed to make a loan was the Great South Western Railway. The capital of that company was 2,600,000l., and 1,400,000l. had been already paid up. They proposed to raise 500,000l. by calls to be expended between this and December; and he proposed to place money at the disposal of the Loan Commissioners, to enable them to make a loan to the company of 500,000l., to be advanced in five or six instalments between this and December; the company making up, at the same time, as he had before said, a similar amount by means of calls. This would enable the railway company to continue the employment of workmen, who, if the advance were not made by the Government, would be dismissed. It would also enable them to employ, as they engaged to do, within a fortnight after receiving the money, 15,000 men beyond the number they could otherwise employ on the line up to Cork, and would likewise furnish them with the means of bringing this part of the line into operation before next Christmas. In the same manner, and on similar conditions, he proposed to lend 83,000l. to the Waterford and Kilkenny Railway Company. The capital of this company was 250,000l., of which 125,000l. had been paid up, and the company promised to raise by calls a sum equal to that which he proposed to lend them. To the third railway in Ireland which he proposed to assist, the loan would be much smaller. It would amount only to 36,000l. The company to whom he proposed to lend this sum was the Dublin and Drogheda Railway Company. Their capital was 150,000l., of 1422 which 100,000l. had been paid up. These sums would be advanced on the usual conditions, the Loan Commissioners being satisfied with the security. The whole amount, therefore, which he proposed to advance, repayable and subject to 5 per cent interest, was 620,000l. Adverting for a moment to another subject, he was sure the House would learn with satisfaction that there had been a diminution of expenditure on the relief works; and he thought it would be desirable to promote as far as possible by these advances on ample security—advances which would be properly expended and not thrown, away on useless undertakings—profitable employment of this kind. He was happy to say that the reduction in the expenditure on the relief works in the course of the last six weeks had been very considerable, and that the expenditure, which he had calculated as approaching to a million of money a month, had been diminished, and the expenditure was now going on at a rate not exceeding 600,000l. per month. That was a diminution of 400,000l. in the month of April, as compared with March. In the week ending on March 13, the expenditure on the relief works was 245,000l., while in the week ending on the 24th of April the expenditure had decreased to 125,000l. Further orders had since been given that the extent of the works should be diminished, as well as the number of the people employed on them; and he was very happy to say that a great number of the persons dismissed from the public works had been given employment by occupiers of the land. [Sir J. GRAHAM: Should not some allowance be made for expenditure on soup kitchens?] Undoubtedly some allowance ought to be made under that head; but the increased expenditure on that account did not at all approach to the decrease of expenditure on the relief works. The right hon. Gentleman concluded by moving—That the Commissioners of Her Majesty's Treasury be authorized to direct advances to be made, out of the Consolidated Fund of the United Kingdom of Great Britain and Ireland, to the Commissioners for the issue of Loans for Public Works, and Fisheries, &c., to an amount not exceeding six hundred and twenty thousand pounds in the whole, to be by them advanced towards defraying the expense of making the following Railways in Ireland, viz., The Great Southern and Western Railway; the Waterford and Kilkenny Railway; and, the Dublin and Drogheda Railway.
§ MR. HUME
had a great objection to this advance of public money under exist- 1423 ing circumstances. On the recent discussion on the Railway Bill of the noble Lord (Lord G. Bentinck), the Government made a very good case, and showed that only a small portion of the proposed advance would go to the relief of the labouring population of Ireland; most of the persons employed would be skilled labourers from this country. But there were difficulties now which did not exist at the former period. The Bank was at that time lending money at 3½ per cent, and Exchequer-bills were at a very considerable premium; but now the bullion in the Bank coffers had fallen from 13,000,000l. to 9,000,000l.; and what was the situation of railroads in England? Could any one of them borrow now at 5 or even 6 per cent? [Mr. HUDSON: Yes.] He was glad to hear it. He had been told by a person well qualified to judge, that since 1825 there had not been such a day as this in the city; and that there was so much difficulty that any bill exceeding a short date could scarcely be discounted at all. What was the case with Exchequer-bills? He doubted whether they had not been at a discount that morning; if not, they were very near it. Was that a state of things in which to advance so large a sum under such doubtful circumstances? Probably the Government would before long have to pay more than 5 per cent for any money they might want; and were we to lose by undertaking to provide this loan? At all events, the project required time for consideration, and it was now past midnight. There were hon. Gentlemen present who had been in the city that day, and would be better able to tell the Government the state of things than himself; but, for his own part, he could not agree to the vote with the statements he had received, and must move that the Chairman report progress.
§ MR. GOULBURN
feared the question now raised would give rise to considerable discussion; and perhaps it might be wise in the Government to allow the Chairman to report progress, and ask leave to sit again; but if they determined to press the vote now, he was ready to go on.
§ MR. BERNAL OSBORNE
had been rather surprised to find the Chancellor of the Exchequer making so important a Motion at such a late hour, and could only on that ground account for the absence of many hon. Members representing Irish interests, and who were strangely negligent of their duty when the affairs of their country were to be discussed. He hoped 1424 these few words would draw from some hon. Gentlemen representing Irish constituencies their opinion on this boon professed to be offered by the Government. He begged to deny that this was any boon to the people of Ireland. As far as he could gather, it was merely a loan of money which the railroads in question had a right to borrow; it was no more than what was provided by their Acts. What was the situation of Ireland at present? The right hon. Gentlemen who sat on the Treasury bench had taken it upon themselves to thrust a poor law upon that country; and he had expected it to be followed by supplementary measures to absorb the surplus labour of Ireland—something more than a beggarly grant of 620,000l.—something that would have been remunerative to Ireland. And this vote was left to twelve o'clock at night; and then up got an hon. Gentleman and opposed the vote, because of the state of things in the city. What was the state of things in Ireland? He solemnly believed that by this time next year there would be very little standing between the noble Lord and revolution in that country. The poor law had already begun to operate, combined with the Soup Act; and the rates were 7s. in the pound in many districts. The Irish Secretary must be aware that no rates could possibly be collected in Ireland; you might collect them from the gentry in several places; but as to collecting them from the farmers and the small holders, it was totally impossible: they were unable even to employ the people in the common labours of agriculture. If the Government wished to save property from confiscation, and to save the lives of the people, they must come forward with some larger scheme than this; he would not say with one for 16,000,000l.—that was the noble Lord's great mistake, calling for such a large sum—but some plan by which the surplus labour of the country should be employed in remunerative works. It was useless for the Chancellor of the Exchequer to tell the House that 600,000l. would be of any avail except to those particular railways; and the House had not heard that the Government were acting upon any great national plan.
§ The CHANCELLOR OF THE EXCHEQUER
must, of course, yield to the Amendment, if the House was to have a long Irish debate, and observations upon the state of matters in the city; but it was an object that the loan to the Great South Western line should be made almost 1425 immediately (if made at all), for the sake of the persons now employed on it. There would be abundance of opportunities for raising the question, as he had to go through Committee with his Resolution, and then to bring in a Bill; and it certainly would facilitate the progress of the grant, if made at all, that one stage should be gone through on that night, and the Resolution be reported the next day.
§ MR. ROEBUCK
could not agree to that. He objected to the principle; and if he let the vote pass, he was, in reality, sanctioning the giving of the money. He must take the sense of the House in every stage on the advance. Talk about the fearful state of Ireland! It would be necessary soon to talk about the state of England too.
§ LORD G. BENTINCK
should not object to the vote going forward. There shall be "more joy over one sinner that repenteth, than over ninety and nine just persons." He greatly rejoiced to find that Ministers had at length discovered that it was cheaper for England to lend her money receiving interest for it upon reproductive works, than upon those useless relief works, which were to return no interest and produced no fruits. He greatly rejoiced, also, to hear from the right hon. Gentleman, that in the course of the last two months, he had become better instructed upon the subject of the number of men to whom the construction or railways would give employment. He (Lord G. Bentinck) had proposed to employ 110,000 men a year with 6,000,000l.; but the right hon. Gentleman then told the House that 6,000,000l. laid out in railways would only furnish employment for 45,000 labourers; now he told the House that 600,000l. would employ 15,000 labourers; so that upon his calculations 6,000,000l. would afford employment not merely for 110,000, as he (Lord G. Bentinck) had formerly stated, but for 150,000 able-bodied labourers. It must be a great disappointment to the people of Ireland now to find upon what false grounds they were deprived of their darling measure for the construction of railways in Ireland. He was glad the right hon. Gentleman had at last come to his senses, and now proposed to grant a portion, at least, of the 16,000,000l. It had been said that he wished to advance money without discrimination to all railways throughout Ireland. He had done no such thing. It was only to those railways which the Railway Commissioners might recommend, and which 1426 should afford a certain guarantee, that he proposed to make advances. The right hon. Gentleman did not come down with any such guarantee. He selected three railways especially.
§ The CHANCELLOR OF THE EXCHEQUER
One half of the capital must be paid up. What the noble Lord proposed was, that all railways should receive advances, whether they had or had not entitled themselves to borrow by paying up, in accordance with the usual conditions, one-half of their capital. The objection to that proposal was, that the railways had not complied with that condition. But those to which the present proposition related had paid up one-half of their capital, and therefore they were in a condition to borrow. But it was further stipulated that they should pay as much more as it was proposed to lend them.
§ LORD G. BENTINCK
The proposition which the right hon. Gentleman had described as offering loans without discrimination, was a proposition to lend money only to railways on which a sum equal to one-third of that asked for on loan from the Government, had been paid up and expended on the railway, and in favour of which the Railway Commissioners reported that they furnished sufficient security to the Government for the punctual repayment with interest of the capital borrowed. And the objection raised to it was, first, that this was not an efficient plan for employing labour in Ireland; and, secondly, that the state of the money-market did not permit such advances to be made. He now found that his calculation that 16,000,000l. would give employment to 110,000 men in Ireland was understated. When it suited the purpose of the right hon. Gentleman, a million of money would give employment to half as many more able-bodied labourers as it could when it suited the right hon. Gentleman's purpose to resist a Motion proposed by his opponents. Then as to the money market; what was the state of the money market now? The right hon. Gentleman, since he (Lord G. Bentinck) made his proposition, had advanced the interest on Exchequer-bills. Nevertheless, Exchequer-bills, then at a premium, had now fallen to 4s. discount; and would it not be necessary for the right hon. Gentleman to raise the interest again? The advance of 16,000,000l. was not, as had been represented, to be made this year; the amount proposed to be advanced this year was only 4,000,000l.; and if the right hon. 1427 Gentleman had advanced the money four months ago, he would have saved a great proportion of the 1,000,000l. a month which had since been, and was now in course of being, expended upon unproductive public works. It was impossible to avoid taking the opportunity of asking the right hon. Gentleman to afford the House some explanation as to the state of the money market, and the prospects of the manufacturing interests of the country. They were told that the best bills could be discounted only at 7 or 8 per cent, and those were bills that had less than 60 days to run. They were told that even Exchequer-bills were scarcely saleable at the present moment. When matters had been brought to such a pass, it might well be asked if this could truly be ascribed to the effect of railway advances, or whether it were not with better foundation to be ascribed to the exportation of gold, which was sent, instead of manufactures, out of the country, as had always been predicted, to pay for unrestricted imports? What did the right hon. Gentleman expect to be the effect of that still larger export of gold required to pay for the corn which was yet to come from America? Had railway speculations done all this? Had it brought up the rate at which good bills were discounted? Had it brought Exchequer-bills to 4s. discount? He recollected that the Bank of England encountered no such difficulties in August last, when it was freely discounting at 2½ per cent, though Railway Bills had just then passed Parliament which involved an expenditure of 120,000,000l. Was it not the Bank Charter Bill, so lauded in that House but a short time ago, which had forced the Bank to contract its issues, and so contract the currency that, it was already grinding the trade and commerce of the country to dust? Why, they would have the manufacturers of Manchester, the traders of Liverpool, all the operative classes throughout the country, in a state approaching very nearly to ruin. Was it the intention of Her Majesty's Ministers to allow things to proceed in this downward course till the trade and commerce of the country could no longer bear the pressure; or was it their intention to come forward and afford the Bank of England some relaxation of those rigid rules which over and above 14,000,000l. annually forbade her to issue any notes, unless each note so issued was represented by a sovereign in her coffers? The Bank Charter Act was a very good measure for fair wea- 1428 ther, but not for times like these. He called, therefore, on Her Majesty's Ministers before it was too late, before thousands of bankrupts came knocking at their doors, to give the Bank some discretion to make use of their credit, and thus enable the Bank directors to cease contracting their accommodation and circulation, which they had now begun, and for some time more would be obliged still further to contract.
§ The CHANCELLOR OF THE EXCHEQUER
had certainly not been prepared for the speech of his noble Friend, who must be aware that he had introduced matter of a very different description from what was actually before them. That matter had been introduced, too, at a time when it could not be fairly discussed—at a time when it was not desirable to discuss it—and, therefore, he did not think his noble Friend had exercised his usual discretion in introducing this subject; because, although he felt imperatively called upon to reply to some of his noble Friend's remarks, it was evidently impossible to go into the subject at any length; and besides it would be unfair to do so, considering that there were some Gentlemen who might naturally be expected to take part in the discussion, and who, at that time of night, would have no opportunity of expressing their opinion. He did not think, therefore, that it was quite right in the noble Lord to introduce the subject after it had been intimated that he (the Chancellor of the Exchequer) was ready to acquiesce in the proposal to report progress. The noble Lord, it appeared, participated in the extreme alarm of impending ruin which was entertained by certain persons out of doors, and had fallen into the grievous errors of those persons in misconceiving and mis-stating (he was sure unintentionally) the facts of the case. The noble Lord had spoken of the state of approaching ruin into which the Bank had brought the merchants by the reduction of its circulation, in pursuance of the provisions of the Banking Bill. Now, in point of fact, the Bank had not reduced its circulation. What was called the stringent operation of the Banking Bill, had not been brought into play at all. The fact was, that up to this time the Bank had pursued that course which, on former occasions, before the Banking Bill, or what was called Sir Robert Peel's Act, passed, it had invariably pursued, namely, that during the earlier stages of a drain it had not reduced its circulation 1429 at all; and had, therefore, placed itself under the necessity of acting more stringently at last, than it would have been obliged to do if it had acted according to the intentions of the Bill. He did not think, then, that there had been any case whatsoever made out against the wisdom of that measure. Quite the contrary; for if the spirit of that measure had been acted upon three months ago, his firm conviction was that the country would not be in the situation in which it now was, Now, he considered it right that the House should know what the facts really were, which he thought rested on a somewhat better foundation than the very erroneous statement which the noble Lord had made to the House. He found that on August 29, 1846, the amount of bullion in the Bank was 16,360,000l., and the circulation of notes 20,426,000l. On the 17th of April last, the amount of bullion in the Bank was 9,329,000l. (showing a decrease of 7,037,000l.) duction in the circulation of notes? If the spirit of the Banking Act had been followed out, the diminution in the circulation would have borne some proportion to that in the bullion; but on the 17th of April, the amount of notes in circulation was 20,242,000l., being a decrease of only 184,000l. Now, would the noble Lord, or any person either in or out of that House, after that statement, which had appeared in the London Gazette, and in every newspaper in the city during the past week, talk of the reduction of the circulation? With respect to the opinions of the noble Lord, and the apprehensions he might entertain, that was for the noble Lord to form a judgment for himself according to the best of his ability; but he ought, at least, to be contented to take the facts as they stood, and not increase the alarm and apprehension which he was sorry to say existed too much already, by a mis-statement of the facts of the case. Next, take the accommodation given to the public, because there was another error Gentlemen fell into, not in a matter of opinion, but of fact. Now, as to the accommodation given to the public—to the traders—upon whom, according to the noble Lord, there was a general pressure, in consequence of the diminution of discounts—by the refusal to discount bills—(he did not mean to say that the Bank had not refused to discount bills, but there was a limit beyond which even the Bank could not go in discounting bills)—if the noble Lord would take the 1430 trouble of looking at the Bank return of last week, the noble Lord would find an enormous increase of private securities in the Bank; and everybody who knew anything of these matters was aware that an increase of private securities held by the Bank at such times as these, indicated an increase of discounts. He knew that an idea existed that there had been a pressure put upon the Bank by the Government; and that in consequence of the assistance asked by Government, the Bank was unable to afford assistance to the merchants in the same way as they used to do before the passing of the Banking Act. If the noble Lord would take the trouble of referring to the Bank returns, he would see how unfounded thatidea was. He took the period of the 29th of August last, and he found that the Government securities held by the banking department were 12,961,000l., and that the private securities were about the same amount, not quite, being 12,395,000l. How did they stand on the 17th of April last? Why, the Government securities had diminished to 11,677,000l., being a diminution of 1,284,000l., while the private securities had increased to 17,111,000l., being an increase of 4,716,000l., or nearly 5,000,000l. Two weeks before (on the 3rd of April) the private securities amounted to no less than 18,627,000l. It thus appeared, therefore, that the Bank had increased its accommodation to the traders in the way of discounts to the extent of nearly 6,000,000l., while the Government securities were less by 1,000,000l. Now, he did not think that these facts bore out the assertions or inference which were drawn from them, or that there was anything in the position of the Bank, as controlled by legislative enactment, which had forced it up, to the 17th of April, to curtail the circulation, or to prevent it from giving that increased accommodation which it had been accustomed to give in times like the present. The Hank had kept up its circulation; it had increased its discounts; but no doubt, having kept up its circulation beyond the proper amount according to the spirit of the Act, it now found itself, as heretofore, in the awkward position of having to pull up more severely in the end than if it had commenced at an earlier period, and thus to make the pressure more severe because less gradual. It was perfectly true that last week there had been some diminution of private securities; but it was equally true that the diminution 1431 of private deposits exceeded the diminution of private securities; the former having been reduced 1,213,000l., and the latter 1,025,000l., as had been the case on former occasions soon after the payment of dividends. He would now refer to another point. Of course there had been, last quarter, as in every quarter except January last, a certain amount of deficiency bills. Now, he would read to the House the amount of Government securities held by the Banking department in the first three weeks of January last. If he compared these with the first three weeks of April last, he should show how little foundation there was for supposing that the amount of public securities held by the Bank was such as materially to interfere with the aid to the public in discounting private securities. The amount of Government securities held by the Banking department on the 2nd of January was 12,826,000l.; on the 9th of January, 12,757,000l.; and on the 16th of January, 12,757,000l. Again, on the 3rd of April the amount was 11,990,000l.; on the 10th of April, 13,574,000l.; and on the 17th of April it was reduced to 11,677,000l.; being considerably lower than in the corresponding period of the month of January. Therefore, in point of fact, with the exception of one week, the amount of public securities held by the Bank was considerably more in January than in April. He would also contrast the month of April, 1846, with the month of April, 1847, with respect to the Government securities held by the Bank. They stood as follows on the days most nearly corresponding to each other in the two years:—
Comparing then the 3rd of April, 1847, with the 4th of April, 1846, the Government securities held by the Bank were less in the present year by 1,145,000l. On the 10th April, 1847, compared with the 11th April, 1846, they were less by 1,063,000l.; and on the 17th April, 1847, compared with the 18th April, 1846, they were less by 1,280,000l. But what was more material as a test of what was called the extraordinary demand of the Government, was the increase in one week, and the decrease in the next. The increase in the week after the dividends last year, was 1,301,000l. In the present year, it was 1,584,000l. The increase, therefore, in the Government securities 1432 held this year by the Bank, in the week after the payment of the dividends, only exceeded the amount of increase last year by 284,000l. There was only one week in which, as everybody knew, the maximum was held. In the course of the week following, the diminution last year was only 480,000l.; but what was it this year? It was not less than 1,897,000l. Consequently, within two weeks of the payment of the dividends, the pressure was taken off the Bank; and the demands of the Government were more decreased this year than the last in the fortnight following the payment of the dividends. He thought this statement completely answered the assertion, that, owing to the pressure put upon the Bank by the Government, the Bank was unable to afford the usual amount of accommodation. His noble Friend also had forgotten the amount of circulation which was usually out among the public in the corresponding period of former years. The amount now in circulation was 20,242,000l., independently of the reserve in the Bank. He had sent for the report of the Banking Committee, and had turned to the returns for some years back, and preceding the passing of the new Bank Act; and he found that in the month of April the circulation never exceeded 18,000,000l., and that in the year 1840, which was not one of pressure, it did not, exceed 17,000,000l.; nor during the whole of that year did the circulation exceed that amount; and it had been down to 15,000,000l. The present supposition of the noble Lord, therefore, was a little, more wild than some former calculations which had been made in that House. Neither the state of the circulation, nor that of the accommodation given to the public, in discounts, was sufficient to account for the alarm which existed in the city of London and in the country. He believed, himself, from what he had heard, that at, the present time of the year trade never was in a sounder state; there was an absence of speculation, and the bankers were acting with great prudence, and were reserving to themselves the ability to meet the demands which might be made upon them. There was no doubt that a drain of bullion was going on, and that this caused a pressure upon all the interests of the country; it had never been otherwise, and he believed it never would be otherwise; but if it were thought to be owing to the circulation of the Bank of England, the pressure could not arise from 1433 that. The price of stocks, no doubt, was low, and Exchequer bills, no doubt, sold that day at 4s. discount; but the price of stocks was not so low as it was a fortnight ago. The 3 per cents that day were 85 ⅞ to 86 ⅛; they were below this a fortnight ago; and now they were higher at the termination than at the beginning of the day. The 3¼ per cents were that day at 87⅛; and on the 10th of April they were as low as 85⅞. This pressure did not arise from the Government, nor was it so great as at the same time in other years. He had kept the Bank warned of what the probable demand for deficiency bills would be; and therefore if it had acted in any way in error, it was not for want of knowing what sum the Government would require. He might as well take that opportunity of referring to another mistake which had been made, in supposing that there had been some extensive operations with the savings' banks money. The complaint had been made that the Government had dabbled with the savings' banks money, and so lowered the funds; but all that had been done was very simple, and must have had a directly contrary effect. The depositors in the savings' banks, finding that a greater amount of interest was given by the private banks than in the savings' banks, had chosen to withdraw their money, as they had a perfect right to do. The only mode of meeting this withdrawal was by selling stock, and therefore the broker was instructed so to do; but in order to prevent a fall in the funds, he had applied the amount of the sinking fund in his hands to the purchase of the stock so sold on account of the savings' banks, thereby preventing the effect in the market which the operation would otherwise have had in the deterioration of prices. So that, so far from anything having been done by him which could possibly lower prices, the result of what he had directed, must undoubtedly have been to keep them up.
1846. 1847. April 4, £13,136,000 April 3, £11,991,000 11, 14,437,000 10, 13,574,000 18, 13,957,000 17, 11,677,000
§ SIR J. GRAHAM
rose, as he presumed, with the same object as many hon. Members who were anxious to address the House; for he must say, that after the latter part of the speech of the noble Lord the Member for Lynn, it was absolutely necessary that the right hon. Gentleman the Chancellor of the Exchequer should make some reply; and he thought the right hon. Gentleman had made his statement with great perspicuity; and, though it might not be in all respects so satisfactory as they could desire, it would have the in- 1434 variable effect of truth, to diminish exaggerated alarm arising from misapprehension. But with respect to the remaining point in this important discussion, he thought it too late then to decide, whether, in the present state of our monetary affairs, the House should agree to the Motion; they must gravely consider the wants of the Irish people and the condition of England, when they were called upon to borrow 650,000l. to advance to three Irish railroads, after all the immense advances which the necessities of that country had compelled them to make during the last three months. This was too important to discuss then; and he hoped the Chancellor of the Exchequer would agree to the Chairman's reporting progress.
§ The CHANCELLOR OF THE EXCHEQUER
had acquiesced in that before his noble Friend spoke, and was not prepared to object to it now.
§ MR. HUDSON
could not permit the statement of the right hon. Chancellor of the Exchequer to pass without some explanation. If the right hon. Gentleman had chosen to bring forward his own views, without casting reflections upon the noble Lord, the House would have heard no observations from him; and if the right hon. Gentleman were to complain of his observations, the right hon. Gentleman had his own indiscretion and want of good judgment to thank for it. The right hon. Gentleman had chosen to state what was contrary to the fact, that the Bill of the noble Lord provided for an indiscriminate loan of money to the different railways in Ireland. That was not true. So far from it, that the Bill of his noble Friend guarded against it in the most careful manner. He wished to call attention also to the fact that in the statements of the right hon. Gentleman with regard to the Bank, he had not said one word with regard to the deposits, which was a most important question in considering the management of the Bank affairs. He thought it right to ask the right hon. Gentleman and the House if they ever knew the money market to be in such a state as at present, when with an amount of bullion in the Rank of England to the extent of nine millions, they found money at such a high price as it now bore? He did not wish to pledge himself as to any particular measure; but he thought it was matter for serious consideration with the Government that with such an amount of bullion in the Bank, money was so high in price as eight 1435 nine per cent; in fact, that there was as great distress in the country now as there was when the amount of bullion in the Bank did not exceed one and a half or two and a half millions.
§ MR. T. BARING
said, the right hon. Baronet the Member for Dorchester thought the speech of the right hon. Baronet the Chancellor of the Exchequer was likely to remove the apprehension and alarm that existed; he hoped it might have that effect; but let him tell the right hon. Baronet that the objections, difficulties, and fear that now existed, did not originate from any reduction in the circulation of the Bank, but from the reduction and contraction of the facilities of accommodation afforded by the Bank. When the right hon. Gentleman knew, and none knew better than he did, that the whole trade of the country, and particularly the export trade, rested on credit, and that without the facilities of the Bank, that credit could never be brought into play; and that if there were any possibility of not obtaining discounts by the Bank, or any doubt of that possibility, no facilities would be given to trade; the right hon. Gentleman would see that if the Bank kept up the full circulation, yet the great difficulty and cause of alarm was not touched by him; which was this, that with that full circulation (and he did not agree with the right hon. Baronet that the Government had had no part in creating the difficulty), with more gold in the Bank than in old times was considered sufficient to keep the whole trade in the country in a flourishing state, yet everybody was afraid of what might happen—everybody was contracting his business, and looking to the Bank, and keeping his own bank notes; and that arose solely from the want of power of the Bank to give that confidence which the country required. He thought his right hon. Friend, when he considered that the statement he had made would remove the alarm that existed—when he stated that there was a circulation of 20,000,000l., and that he had only taken his usual advances—had not touched the real question, which was, how was the trade of the country to be carried on if no facilities were given by the Bank?
§ MR. FORBES
wished to ask the right hon. Baronet the Chancellor of the Exchequer how it was that, with the accommodation which the Bank charter afforded, the late Chancellor of the Exchequer and the right hon. Gentleman the Member for Dorchester thought half a million so serious a 1436 matter in regard to Ireland, and how it was the application which had been made from Scotland by the Scotch banks for the relief of half a million of gold was refused?
§ MR. J. A. SMITH
said, that the circulation was perfectly sound. They knew that the amount of Bank notes in the country was perfectly adequate to the general wants; but, confidence, which was shaken through the alarm as to the condition of the Bank, was wanted. They knew that the accommodation given by the Bank was limited to the amount of its rest, and that was the only ground of distrust. It was altogether a most anomalous state; for, instead of the currency being depreciated, he found it it was appreciated. It was probable that the inconvenience to which the Bank had exposed the community would have been less if they had made their contraction before; but he believed that in London there was unnecessarily great distrust and alarm. At the same time, he did not think that the statement of the right hon. Baronet the Chancellor of the Exchequer would remove that apprehension, because it did not touch the grounds upon which that apprehension rested. He hoped that, if necessary, some discretion would be given to the Government to increase confidence in the Bank, and to confirm the opinion expressed by the right hon. Baronet. He entirely agreed with the right hon. Baronet that commerce was never in a sounder state—that there was never less of speculation; but in his experience he had never seen alarm more general or greater than in the last few days. He believed that that alarm was not well founded; but it produced results equally as disastrous as if it were.
§ MR. NEWDEGATE
begged to call the attention of the House to one fact. A very great injustice had been done to his noble Friend (Lord G. Bentinck); for his noble Friend had stated that there was an anticipation of great distress and great pressure dating from this period—an anticipation, the truth of which the whole statement of the Chancellor of the Exchequer tended to confirm. It was not fair it should go forth that his noble Friend had stated that the contraction of the circulation had taken place, when his noble Friend had only referred to the future, and when his whole statement was confirmed by the Chancellor of the Exchequer. The statement of the right hon. Gentleman turned wholly on the word "hitherto;" for he said, that hitherto the Bank had not acted on the law, and 1437 that hitherto the pressure had not occurred.
§ The CHANCELLOR OF THE EXCHEQUER
proposed to adjourn the debate to next day, and he hoped that it might come on, for he thought it very desirable that 1438 this discussion, having been commenced, should be concluded.
§ House resumed.
§ Committee to sit again.
§ House adjourned at half-past One o'clock.