§ Order for Committee read.
§ SIR FITZROY KELLYsaid, he wished to put two questions to the right hon. Gentleman the Chancellor of the Exchequer with respect to the Resolutions now on the table of the House. The first was this—supposing the Resolutions received the sanction of Parliament, and any number of persons should elect to com- 980 mute their stock into the 3¼ per cent stock 1844, was it the intention of the Government to make purchase of that description of stock to supply the demand so created, or to create stock, on the same terms of course as that created under the Act of 1844? And if the latter course were intended, then he desired to know whether the creation of the stock would be attended with any condition as to the increase of the capital amount of the National Debt. He also begged to ask what was the description of persons who would be the subject of these Resolutions whose stock stood in the names of the Accountants General in Chancery, or the Accountant in Bankruptcy, and in what relation they stood to the South Sea Company whose stock was to be dealt with by these Resolutions?
§ The CHANCELLOR OF THE EXCHEQUERSir, I may answer those questions without any difficulty. With respect to the first question, our intention is, in case any commutation on the part of these trustees should be effected, that the means for that commutation shall be provided by the creation of new stock. With regard to the question of the increase of the capital of the national debt, my expectation is that this arrangement will be effected with some diminution of the capital of the national debt. It is a very small amount—scarcely worth mentioning—but I have no doubt that, instead of an increase, it will occasion a diminution of the capital of the debt. With regard to the third question, who the persons are that stand upon the Accountant Generals' accounts in Bankruptcy and in Chancery, I shall give an answer which will probably be the most intelligible to the hon. and learned Gentleman, with his professional knowledge. I believe that they will be the same miscellaneous description of persons as those who stand upon the Accountant Generals' accounts in other larger stocks. With respect to their relation to the South Sea Company, that, I apprehend, is a question of law, which I am not well able to answer it the present moment. I presume, however, but I speak under correction, that he Accountants General must be partners in the South Sea Company, just like any other partners in respect of those stocks, and that the persons to whom those stocks really belong can have no legal rights as partners in the South Sea Company. I will not go into the question of how they are to be protected, or whether they are 981 likely to be damnified; but I think I am right in stating that that is their legal position.
§ House in Committee.
§ Resolution 2.
§ Motion made, and Question proposed, [July 28]—Debate resumed.
§ The CHANCELLOR OF THE EXCHEQUERSir, in introducing these Resolutions yesterday to the notice of the Committee, for two reasons I confined myself very strictly to a brief and dry comment upon the text of the Resolutions. One of those reasons was, that at the present period of the Session, and in the present state of the business of the House, I was not willing, without necessity, to occupy the time of the Committee, and thereby contribute to the prolongation of a Session which has been unusually long and laborious. And the other reason was, that in my judgment the time for a full discussion of this question had not yet arrived. But the speeches which were subsequently made gave a much larger range to the subject, and have imposed upon me the necessity, which for the reasons I have stated I much regret, of troubling the Committee at greater length than I should otherwise have done, and of bringing before them matters to which I did not advert in my opening address. In point of fact, three subjects of a character in a great measure distinct have been so far introduced to the notice of the Committee as to make it necessary for me to remark upon them, two of them being subjects which undoubtedly demand, or will demand, a fuller consideration than any that they can now receive, and the third being the subject of the Resolutions upon the table of the House, which I conceive, with great respect to the Committee, to be a matter of minor range and scope. The other two subjects are the merits or demerits, as it may be, of the Act of Parliament passed at an early period of the present Session, and the subject of the unfunded debt. Both of these are matters of great consequence. Both of them are matters which we can at present discuss with only a partial and limited knowledge, the circumstances not being ripe for the Committee to form an opinion upon them. I have to apologise, therefore, for the necessity of touching upon them. It is a necessity, however, which has been occasioned by the speeches the have been made. Now, as regards the present Resolution, to which I will first 982 address myself, an objection has been taken in the Committee, to which I must refer. It was countenanced by the vague and indefinite language of the right hon. Member for Buckinghamshire (Mr. Disraeli), and it assumed the form of a full-blown misunderstanding in the speech of my hon. Friend the Member for Stockport (Mr. J. B. Smith). It was, that we ought not to revive or to resuscitate a plan which was really defunct, by offering new terms of commutation to parties, who, having already had the option of commuting, have not thought fit to avail themselves of it. Sir, there is no attempt to revive or to resuscitate that proposal. There is no intention, and there is no proposition on the table which would have the effect, with the insignificant exception of the small sum contained in the third Resolution, which we are not discussing, of offering to the holders of stock, who had the power of commutation under the Act of the present Session, and declined to avail themselves of it, any new power, or reopening of the option, whatever. I am very desirous that this should be clearly understood both by the Committee and by the public out of doors. It was not for my own sake, or for the sake of the Government., which is comparatively a matter of trifling importance, that I am so anxious, since any misunderstanding which affects them will be cleared up by the lapse of a few months; but it is because impressions of an erroneous kind, propagated by the speeches of Members of this House, immediately fly abroad, and their injurious influence on the very moment is felt in the state and condition of the public credit. For that reason I am most anxious that this misapprehension, at all events, should be entirely put out of the way, and that it should be distinctly understood that there is no individual who had the option offered to him by the Act of the present Session, and who declined that option, to whom any offer is now proposed to be made. I confess I was surprised at some statements which I heard yesterday, and which it appears to me need not to have been made, even after a most superficial inspection of the terms of these Resolutions. It was stated that it was proposed to take the power of making an arrangement with those parties for an unlimited time. Why, the language of the Resolution is, that that power shall be taken for a time to be limited. In the Resolutions, in accordance with all form and precedent, are included the general outlines of what we propose to do, 983 while the filling up of those outlines is necessarily reserved for the Bill to be founded upon them. The only question is, whether a custom has not grown up, from which certainly I have not derogated, owing to the desire to give as much information as possible, of rather overloading Resolutions of this character with a formality of statement, and in that manner making them much less easily intelligible than they would otherwise be? In point of fact, the meaning of the second Resolution, which would have run to a very great length indeed, if all the particulars had been included, and which at present is rather formidable, is simply this—that certain parties being holders of South Sea Stock, and having been disqualified by law from taking advantage of the late Act of Parliament, should now have an offer made to them, analogous, as far as it can be, after the change of circumstances, to that which at a former period was made to their fellow holders. That is really the meaning of the second Resolution. Then the hon. and learned Member for Suffolk (Sir F. Kelly) makes an objection to this Resolution that the power which it gives of commuting stocks is given to the South Sea Company as a body, and not to the particular holders, whom I have already declared, and whom the Resulution declares, to be the exclusive objects of this proposition. Well, Sir, I should have hoped that the hon. and learned Gentleman's professional experience would have brought him to the same conclusion as the professional experience of my advisers brings them; and would have told him that in the case of an incorporated Company it would be very difficult for this House to establish direct relations with individuals who are the members of that Company. The form of the Resolution in that respect, empowering the South Sea Company to act, in lieu of empowering certain individuals who are holders in it to act, is simply founded upon considerations of convenience, and on the fact that if we endeavour to establish those relations with individual holders, a great deal of enactment will be necessary to render that process practicable, which is much better spared. But when the hon. and learned Gentleman says that those parties may be damnified by giving this power to the South Sea Company, there again he falls into the same error of assuming that every provision which a Bill of this nature is to contain, ought to be set forth in the Resolutions. There are certain 984 things so absurd upon the face of them that it is not always deemed necessary to specify in a document that they are not to be done. I should have thought it was perfectly manifest that no one gifted with the use of his five senses could possibly have contemplated anything so ridiculous and so tyrannical and unjust as it would be to put into the hands of the South Sea Company, as a body, the power of dealing arbitrarily with the interests of certain of its partners. Of course, it is intended that the South Sea Company shall merely act on behalf of those parties, and that its so acting shall be with their consent, at their instance, at their desire, and, of course, exclusively for their benefit. I have looked at the Resolution to see whether I might not in some way satisfy the squeamish apprehensions of the hon. and learned Gentleman, by inserting in it something to convey that what is done must be with the consent of those parties. I do not say that it may not be done, but it will add a great deal to the length, while it will not at all add to the clearness of the Resolution. I am an advocate for brevity and clearness, and I hope that the Committee, therefore, will be content to rest satisfied with the assurance I have given, and that they will look at the Bill to see that that which is the intention of the plan shall be so secure that there can be no deviation from it in carrying the plan into execution. We heard yesterday that the power which is asked in this Resolution on behalf of the Treasury, was an unlimited and unprecedented power. I confess I listened with very great surprise to that objection. It is perfectly obvious that certain powers of discretion must be reposed in the Treasury, or in any department, or in any Minister, that has the management of the public money. In my opinion you do not go wrong in reposing that discretion, but you do go wrong if you do not call the Minister to a strict account when it has been misused. I had neither the intention nor the desire to call for any extension of such powers beyond the limit that usage and the law prescribe. What have I asked for in the present instance? I have asked for a power to exchange certain portions of the South Sea Stock for 3¼ per cents; and the total amount contemplated by the present Resolution which could possibly come under that exchange would be about 2,000,000l. Parliament, perhaps, may wish to limit that power. If it be so desired, I really do not entertain any deci 985 ded objection to it, but I do not think that it would be advantageous to the public interest. I think it would be much better for the public interest, when you want your agent to deal with certain parties, that you should send him without minute instructions, which must be given in the face of the world, and which, in fact, only aids and assists those with whom you are going to make a bargain. That, I think, is a left-handed mode of proceeding. The proper mode is—first, to choose a proper agent, and if he is not a proper agent whom you have in your Chancellor of the Exchequer, put him out and get a proper one. Then, having got a proper one, give him discretion that may be used for the advantage of the public, mid when it has been used then call him to account. But, only to satisfy the Committee that the power which I am asking is perfectly trivial in comparison with the statutory powers already in the hands of the Minister of Finance, I will just make two references. At the present moment you give by Statute to the Treasury, or to the Chancellor of the Exchequer, the power of disposing of 30,000,000l. of the public obligations under the name of Exchequer bonds, which it is in the power of the Treasury, by an enactment which you have passed, to bring into the market and to sell at any terms they please. It is likewise in their power to saddle the public with the payment, at the option of the holder, of those Exchequer bonds. Perhaps you will say that that was done by a recent Statute; but I ask, is it out of keeping with the power which you have given the Chancellor of the Exchequer by other Statutes? There is a Statute, which you renew from year to year, with respect to Exchequer bills. What was the power given in the Act of the present year? You have authorised the issue of 17,800,000l. in Exchequer bills. The present rate of interest upon these bills in round numbers is 1½ per cent; but you have placed unlimited and uncontrolled power in the hands of the Chancellor of the Exchequer, without any notice to anybody, to raise that interest threefold. The total sum of interest due from the public at this moment, at the existing rate, on the present amount of Exchequer bills, which is something more than 14,000,000l., would be about 210,000l. But it is in his power, by stroke of the pen, to saddle on the country, instead of 210,000l, for the current year, 986 the payment of 630,000l. by raising the rate of interest on Exchequer bills. I merely quote that in answer to what was stated yesterday; but, after all, this House has been accustomed to proceed upon the assumption, not that men who are placed in public offices are only fit inmates for lunatic asylums, but upon the assumption that the system of Parliamentary responsibility is worth something, and imposed limits to abuses which could not well be transgressed. All I wish to impress upon the Committee at this moment is, that if there be a jealousy and a desire to restrain the exercise of that discretion, I will not say that I should think it my duty absolutely to resist it; but I am quite sure that it would be a very left-handed method of proceeding, and one which would operate exclusively against the public. Taking the subject, however, as it now stands, upon the Resolution as I have proposed it, which I think is the best and most proper form, it is altogether insignificant as compared with the powers which you absolutely, from year to year, and I shall say of necessity, confer upon the Minister who fills the department of Minister of Finance. It was stated last night that this was no party question, and an intimation was given by an hon. Gentleman behind me, that upon that account he would exercise his own option, and would vote, I think he said, against the Resolution which I have brought forward. The hon. Gentleman gave that intimation, I am aware, under a misapprehension which was probably due to the hurry with which he had been obliged to read the Resolution. I have now, however, distinctly explained to him, I hope, that this; Resolution does nothing of the kind that he anticipated, and that it does not reopen the option to parties to whom it has already been given by the Act of the present Session, and by whom it has been refused. With respect to this, must beg to remind the hon. Member, that, in the exercise of his undoubted discretion the right hon. Member for Buckinghamshire has given an entirely different character to this discussion. The right hon. Gentleman stated that it was necessary that the House should pause before it passed these Resolutions; and he based his objection to the measure distinctly on the ground of the incapacity of the Government, and their failure in dealing with financial questions. That challenge the right hon. Gentleman has fairly given. 987 That is the issue which he has raised. By that issue I am perfectly content to be judged; and if that is the point at which we have arrived, no man is less disposed to flinch from trying that issue, and no man is more desirous, if that is the view of the House of Commons, that they should proceed to make better arrangements than can be made while I am Chancellor of the Exchequer in managing the finances of the country. Having noticed the objections which have been taken to the second Resolution, I will now state in a very few words the positive reasons which appear to me to render it a matter of good policy—and not of good policy only, but of justice—that the Committee should adopt a measure of this nature. The main proposition to which I ask your assent is, that certain options should now be given to parties who were intended to have the benefit of the former Act of Parliament, but who were disqualified by law from availing themselves of that benefit at the time the Act passed. I say that justice to those parties demands it. I distinctly place the claim for passing this Resolution upon the ground of justice. I place it upon the ground of justice, because it has always been the habit of Parliament, and because it is the dictate of natural equity, that when you are dealing with the holders of stock of a particular description you have no right to draw a distinction between them, but should observe substantially the same line of conduct with regard to them all. On proposing myself that persons; holding stock in the names of the Accountants General in Chancery and in Bankruptcy should be precluded from taking the benefit of the Act, what was the effect of that proposition, and who was the first person to notice the injustice of that decision? The Lord Chancellor of the late Government. That noble and learned Lord it was who raised that point fully in the House of Lords, and who at once obtained from my Colleagues in that House, the assurance that an enactment should be proposed which should substantially place parties in a position as good as that of those to whom the options were given by the Act. It is that pledge, given in answer to the Lord Chancellor of the late Government—a noble Lord whose power to form a judgment of what equity requires in such a case no man will dispute—it is that pledge that I now propose to redeem. But it would be absurd to pro- 988 pose to redeem it by merely giving the options which were offered in April last. The change of circumstances which has taken place since that time makes those options appear valueless now which appeared valuable then. I propose, therefore, that you should make an offer to them which should be as good to them during the time which has to elapse before the 5th of next January, as the options which you offered in April were at that period to the parties who were in a condition to take advantage of them. The Resolution relates to persons who hold stock in the names of the Accountants General in Chancery and Bankruptcy; but the persons principally contemplated by it are in a different predicament. Their case had not been brought before me at the time when I made the original proposal to the House. I had no idea either that the proportion of stock of the South Sea Company held in trust was so considerable, or that there were no means by which the voice of the persons holding that stock could be made available in determining the course that was to be taken by the Company. But the case as it is now before us is perfectly clear. Those parties are absolutely disqualified by law—not by our Statute, but by a law wholly independent of our Statute—from voting on the question whether the Company should commute its stock, or whether it should not. That being so, I say that you are bound, in common justice, to make some offer to those parties. It is a very hard case upon the holders of trust stock, when individuals have had the option of commuting, with regard to whom the fact of being paid off would generally be no great hardship, that trustees to whom it almost always is a great hardship, and with whom it is generally worth while to take any commutation that Parliament offers, should be entirely shut out from the possibility of availing themselves of such commutation. Therefore, not having interfered with South Sea Stock as a whole, and having given to persons the opportunity to commute, I say, do not allow these other parties who are trustees to suffer so serious an injustice as that they shall be compelled, without any option being given to them whatever, and when you have taken a different course with regard to other partners in the Company, to receive certain moneys on the 6th of January next, irrespective of what 989 changes might accrue between the Interval yet to elapse, with the obligation which they are pretty certain to be under of being compelled to reinvest them forthwith in the public securities. I think, then, that justice to those parties demands the adoption of a proposition of this kind. I must also point out to the Committee that the convenience of trade requires this measure; because, as I stated yesterday, nothing can be more adverse to the convenience of trade than the sudden issue of money. And this particularly applies in the present case, for the sudden issue, amounting to 2,000,000l., and coming, as it must., at a time which coincides with the payment of the dividends, will necessarily have the effect of producing an artificial abundance of money. If it were a bonâ fide liquidation of debt, you might say that it was an inconvenience which could not be avoided. No doubt; but this is not a bonâ fide liquidation, because the very creditors whom you pay off would again become your creditors by forthwith buying into the public funds. Having had the money unlocked on the 5th of January, it would be locked up again upon the 7th. That is a very inconvenient course of things, and it is one which it is not necessary to incur. I do not say that it is an inconvenience which could not be borne, but it is one which may be spared, and therefore it is the duty of the Committee to obviate it. I do not hesitate to say that, besides being demanded by justice—beside; being a means of obviating inconvenience to those who are engaged in trade and commerce, it is likewise for the advantage of the State that there should be no unnecessary—issue of public money upon the 5th of January. As matters stand at the present moment, I do not anticipate any difficulty in meeting the maximum demand that may be made upon the Treasury; but I will state at once that I cannot consistently with my duty, and I say it with all respect—I will not enter into any defence of myself which involves a statement of any expectations and views with respect to that amount. No amount of debate, in amount of attack from the right hon. Gentleman opposite, shall induce me to deviate from that resolution, because I am convinced that were I to do so, it would be injurious to the public interests. All I can say is, that I anticipate no difficulty what ever—and, as far as one may presume upon no extraordinary circumstances happening in the interval, I am confident that I shall 990 have no difficulty whatever—in meeting the demands which may be made in January cued April under this operation. But I am no prophet. I never pretended to be master of the elements. I never professed to be gifted with more sense than other people or boasted of the possession of faculties beyond the range of other men, or that I could strike out a course entirely independent of the course of former times. I am quite content to walk in the way of tradition and precedent, and when I cannot do a great thing for the public, I am perfectly ready to do a small one. I really cannot tell you now, though it may appear a somewhat humiliating confession, what the harvest may be, or what quantity of corn may come from abroad. I know that there is 4,000,000l. less bullion in the Bank of England now than there was twelve months ago; but I cannot say how much of that bullion may be required for paying for corn. I think it for the convenience of the public, however, to narrow the margin as far as other circumstances permit, and render it convenient and just. If, then, it is for the convenience of the public, nothing is more absurd than to say, because I have misconducted myself that therefore the public shall suffer. Pass any censure you please upon me, I am perfectly ready to meet it; but do not refuse to the public that which is a convenience and an advantage to them on account of any feeling which you may entertain of the adroitness or mad-adroitness of the way in which the finances of the country are conducted. That is all I think it necessary to say at present with respect to the substance of the second Resolution. But, as I have said, I am under the necessity of adverting to other matters, because the right hon. Member for Buckinghamshire, followed by his alter ego in finance, the hon. and learned Member for East Suffolk (Sir P. Kelly), entered into a discussion of the merits of the whole measure of last spring. I have not the least disposition to check the liberty of the right hon. Gentleman to discuss any measure at any time he thinks fit; but if he says that this is the time at which the merits of that measure ought to be discussed, I beg leave most respectfully to differ from him; and my reason is this, that you cannot ferns a view of the operation until the operation is complete. Yon will have that opportunity next year. It cannot be postponed. It is all written down in the law. Whatever 991 the effect may be, on the 5th of January next and the 5th of April next, that effect must become final and conclusive. You will then have an opportunity of calling the Minister to account, and I shall then be in a condition to exhibit to you what are the actual pecuniary results of the measure But at the present moment you know nothing, except that about one-fourth of the persons holding minor stocks—stock other than that of the South Sea Company have agreed to commute, and that three fourths have not agreed to commute. The right hon. Gentleman, in his impatience thought that he might take advantage of the bad weather and the state of stocks and that he had much better not wait until the proper time for discussing this question. There has been a turn of affairs one way; there may be a turn of affairs another way. The right hon. Gentleman, who is great master of tactics, thought it well t seize the moment to raise the prejudice when he could, for a little sunshine probably might dissipate a good deal of what he said I do not wish to check discussion, but I do say that the Committee will not be in a position to form an opinion upon the merit of this measure, until the time shall arrive when the payments shall be actually made and when you see the state of the public revenue, the state of the public balances and the state of the unfunded debt, after those payments have been made. That is the time when you will be able to form your judgment, and anything that can now be said, must of necessity be partial am inconclusive. But the right hon. Gentleman complains that the measure of the present spring was hurried through the House; and, in relation to that complaint of his, I think it my duty to speak with great plainness, and to state the which I conscientiously entertain, irrespectively of the question whether it may be agreeable to everybody or not. So far from that measure having been hurried through, I say that that measure was most unfortunately delayed in its passage through this House. I say this, and I wish it to be remembered, not for the present occasion only, not for the present Minister, not for the present Government merely, but I say that it is impossible for this House to undertake the management of the finances of the country in public debate. A Minister may mismanage them. This House if it so undertakes them, must mismanage, them. I defy you to conduct them in public here, watched by the whole world, 992 including those with whom you are going to transact business, without serious injury to the public interests. That injury did result from the delay which occurred in passing the measure in the spring. It is well known, it is perfectly notorious, that if it had passed with greater expedition, it would have effected a great deal more than it did, and the advantage to the public would have been much more considerable, had it not been for that delay. I am not interfering with the freedom of public debate, but I point out the consequence to the public interests. They must be damaged by delay in carrying out these propositions, and either you ought to make up your minds to reject or to accept them at the earliest possible time. As to complaining that a particular stage of a Bill was passed after eleven o'clock at one time, and that it is brought forward at a very inconvenient period at another time, submitting all kinds of crude and impossible theories, and discussing the same thing over and over again, that may be all very good political economy, or it may be the worst that ever was heard of, but altogether the season is very inopportune. But, to return to the Resolution: you must either be content to have these plans marred in their operation, or you must be content to repose a large discretion in the Minister, in which event you can call to account, and to a strict account, the person in whom you repose that discretion. The right hon. Gentleman (Mr. Disraeli) exhibited great compassion for what he called my "disappointment." Yes, Sir; but, if my disappointment is considerable, what must his be? I am disappointed. I did not anticipate in the first week in April all that has since taken place in the political world, or in the natural world. Circumstances, I think it will be admitted, have changed a good deal since that time. Look to the rate of discount at the Bank; look at the rate of interest allowed by the great bill brokers; look at the state of gold in the Bank and the price of funds, and you will see that there has been an essential turn in the state of affairs which it was impossible to anticipate. The hon. and learned Member for East Suffolk says, that during the discussion in the spring, circumstances occurred which ought to have made me hesitate; and he added that when doubts arose I ought to have receded. Now, that affords an exact illustrationn of the mischief which resulted from the protracted nature of the debates upon 993 that measure. But because doubts have arisen one way, non constat that doubts may not arise of an exactly opposite description. The doubts which have arisen one week may disappear the next week; and the mere fact that a little cloud appears on the horizon, which may grow into a great one, or which may disappear altogether, is not to justify a change in a measure of an important character, which is announced to Parliament upon the responsibility of the Government. Well, Sir, I am disappointed. I think the doctrine of the ancient mythology was, that there was a fate which proceeded from the mouth and the will of the gods, and against that fate it is said in the ancient poets a valiant man, determined to do his duty, might struggle with success; but there was a higher unwritten fate, against which no man and no god could struggle. I think that I have had that unwritten fate to contend with—a fate against which no man could struggle. I frankly own that it was not in my power to control either politics or the weather. I have suffered the consequences; but if I am disappointed, the right hon. Gentleman must be much more so. What was his charge against the plan of the Government? He refers conveniently to the speech of the hon. Member for Huntingdon. (Mr. T. Baring); and I am desirous that the hon. Member for Huntingdon, whose candour and moderation invariably add weight even to his experience and ability, should have the fullest credit for the suspicions and apprehensions which he entertained, and which I rather think my hon. Friend the Member for Stoke-upon-Trent (Mr. Ricardo) also entertained, with respect to the success of the plan. But the right hon. Gentleman objected to it on quite a different ground from that which occurred to those two hon. Members. He objected to it on the ground that the result which I proposed was not at all adequate to what might be expected. He read what he thought the maximum saving might be, and I think he calculated it at 600,000l. a year. He quoted Sir Robert Walpole. He referred to all the previous reductions of interest during the last forty years, from 6 per cent down to 3. He showed that I had not held out any such expectations, and he left you to conclude what an insignificant fellow you had now got for Chancellor of the Exchequer. That was the line of the right hon. Gentleman; and what was the tone of the objection of the hon. and learned Gentleman who so faithfully 994 reflects his mind in matters of finance, and who now sits beside him? Did the hon. and learned Member for East Suffok anticipate that that plan would be inoperative? No. He came forward yesterday with his compassion for those persons who, "trusting to the calculations of the Government," had accepted the commuted stocks, and found themselves disappointed with the results. The calculations of the Government! No, they were not the calculations of the Government, but I will tell you whose they were. They were not misled by my calculations, but they were misled by his calculations. Now, I'll contrast the words which were used by myself with regard to that measure with the words that were used by the hon. and learned Gentleman who taunts me with having misled the world. Here is something like a rule-of-three sum of the hon. and learned Gentleman's. He is a master of figures, no doubt. He found that in the last forty years there had been a fall in the rate of interest from 6 per cent to 3 per cent; and, darting forthwith into figures, and making use of his imagination as well as of the rule-of-three, he says, that as it has fallen from 6 per cent to 3 per cent in forty years, so it is probable that it will fall in the next forty years from 3 per cent to 2 per cent. He then says—
In the forty years now completed, the interest of money in the funds had fallen 2 per cent. Looking, then, to the increasing commerce and prosperity of this country—to the vast amount of capital at their disposal—at the great influx of capital from foreign States, where the same confidence as to political affairs did not exist—was it extravagant or unreasonable to suppose, trusted as this country was to an indefinite amount by the whole civilised world, that in the next forty years the interest on the money in the funds might fall from 3 to 2 per cent?That was the language of the hon. and learned Gentleman—
§ SIR FITZROY KELLYAnd is now.
§ The CHANCELLOR OF THE EXCHEQUERWell. if that were his language, surely he has no right to talk now of persons being misled by the calculations of the Government. Did I subscribe to that? On the contrary, I did my best on the instant utterly to protest against it, and to expose the gross futility of such a notion. How did I describe that measure to the House in introducing it? The right hon. Gentleman said, that I seemed to be under the impression that I was going to effect a gigantic operation, and to think that I was destined to bring about some wondrous 995 revolution. Upon the 8th of April of the present year I said—
I do not recommend the proposition that is now before the Committee as a proposition which can effect any sweeping or fundamental change; but I venture to recommend it to them as a proposition which is just and prudent in itself, and which will probably lay the foundation for more extended improvements in future."—[3 Hansard, cxxv. 810.]These were the words, Sir, in which I recommended that measure to the House. I begged the House to moderate its expectations; I referred to what I thought were the inflated expectations out of doors, and I said that the merit of the proposition, if it had any merit in it, was that it was both safe and just, and that it would be good and beneficial for the present, while it would open an opportunity and afford a promise of more extended operations in future. If the hon. and learned Gentleman says that he does not change his language, I think that I may also say I do not change mine. Disappointed as I am, however, I still say that the little that has been done has entailed no loss and no evil on the public, but that it has laid the foundation for more extended operations in the future. Again, I must refer to the right hon. Member for Buckinghamshire, who spoke of the "certain loss" inflicted by that measure. He did not tell me what that loss was. He did not tell me where be had heard it—
§ MR. DISRAELII meant the loss of the 100,000l., which you counted as gain. I did not mean any absolute loss.
§ The CHANCELLOR OF THE EXCHEQUEROh, you mean the disappearance of that which was anticipated as gain, and do not speak of any absolute loss. I am glad I understand that. With respect, then, to the measure generally—I mean the Act of the present Session—what I do say is, that whatever attacks may be made upon me, my defence must necessarily stand over until the time when the dissentient stockholders shall be paid off. I cannot make it now, for two reasons—first, because the saying what I might say would not, perhaps, be altogether for the public interest; and, secondly, because we cannot anticipate, except within certain limits, what will be the precise state of circumstances upon the 5th of January and the 5th of April next. I wish that persons should contemplate the measure, so far as it has gone, upon a knowledge of the exact truth. Upon this point I have already re- 996 ferred to the restraints and the curbs which I endeavoured to impose upon public expectation with regard to the immediate effect of the measure. Besides that, I wish to go so far at least as this, with reference o my own defence and the defence of the Government, and I would not go so far even were it not that, irrespective of party differences in this House, we all have a common interest in the maintenance of public credit, and in preventing the dissemination of rumours and alarms which tend to its depreciation. What I wish to stand upon s this:—I did not enter into the proposition of last April upon the assumption that those minor stocks must necessarily be converted. I think, if I had done so, and had advised the House to propose that commutation with the alternative of paying off, and had not taken into view what must have happened in the event of the commutation not taking place, I should have been very deficient in my duty. It appears to be assumed, however, by those who condemn the measure, that there was in my view but one alternative—that of commutation. That is not the case. As well as circumstances permitted, I endeavoured to try and calculate what would happen to the public in case the commutation should have been rejected. You cannot form a judgment upon the measure by merely asking whether the commutation has been generally accepted or declined. The question is, what will be the fate of the public in either event, and what will be its effect upon the public interests now that three-fourths of the shareholders have declined to commute, and, therefore, that three-fourths of the money must be provided? That question must be answered. Well, suppose that, notwithstanding the failure of the commutation, it appears that the paying off of those stocks can be effected with positive economy to the public, and without rendering the state of the public credit in any degree insecure: is the measure, then, a bad one? Is public saving per se a bad thing? It is not my duty, now, to enter largely into the means by which that payment may be effected; but there are three things absolutely essential for you to take into consideration before you can form a judgment upon the measure: first, the state and prospects of the public revenue; second, the state of the balances in the Bank of England; and, third, the state of the unfunded debt. The whole thing turns upon that. If you have ample means of meeting the claims of next year, 997 then I shall stand up for my measure, and shall contend that it has not been, as alleged by hon. Gentlemen opposite, a total failure, for I shall have made out my case before the country irrespectively of those parties accepting the commutation. I had taken into consideration the possibility of their not commuting. I did not expect that they would commute. I was not so outrageously sanguine as the right hon. Gentleman opposite stated to the House, that people were waiting in eagerness to accept the commutation. I beg to state that I said nothing of the kind. [Mr. DISRAELI: I said that the Government said so.] That is a distinction which I did not observe. But certainly I never said so; and those who know my private conversation, know what the state of my mind was. I was very open on the subject, and was very much convinced of the uncertainty of the matter. I was by no means outrageously sanguine with respect to it. But on the state of those three things which I have mentioned will depend entirely the question, whether the measure was a good one or a bad one. A limited one I grant you it was; but I contend that it was not a measure involving danger to the public, but, as far as it went, that it was not only a just but a prudent measure. The right hon. Gentleman opposite has himself adverted to the important subject of the unfounded debt, and I thank him for having introduced it into this discussion. I am quite aware that the state of the unfounded debt is very different from what it was twelve months ago; and I do not feel the slightest inclination either to keep back the fullest investigation as to the extent of that difference, or to avoid any discussion as to the means by which it was brought about. I repeat I am much obliged to the right hon. Gentleman for having introduced this subject to the notice of the Committee, and though here again we are not in a condition to form any final conclusion, yet I say so far as we have as yet gone, I regard with considerable satisfaction the state of the unfunded debt, compared with what it was twelve months ago. It has been reduced by 3,100,000l. The present issue of Exchequer bills is 3,500,000l. within the statutory limit; and it is quite clear that that 3,500,000l. forms a margin of which I may avail myself to meet those payments on account of the uncommuted stocks as they fall in. Now the present state of the unfunded debt is this:—It has been reduced by 3,100,000l. The interest also has 998 been reduced. The reduction of the interest is a matter on which no permanent calculation can be founded. It is always subject to variation once in twelve months, and sometimes more than that. Circumstances may at any moment arise which may make it the duty of the Finance Minister to alter the rate of interest on Exchequer bills. Now what was the charge upon the public for Exchequer bills last year, and what will be the charge during the present year? The Exchequer bills of 1852 fell due in March and June, 1853, and the rate of interest has been fixed in 1852. The amount of interest payable on the bills due in March was 192,000l., and the amount payable on the bills due in June was 174,000l. That, of course, has been liquidated, and new Exchequer bills have been issued. The amount payable upon the March Exchequer bills of 1854, instead of being 192,000l., will be only 125,000l., and the amount payable in June, 1854, instead of 174,000l., will be but 89,000l. The total amount payable for interest this year was 366,000l.; but the total charge to the public, irrespectively of any change in circumstances, upon the Exchequer bills of 1853, which will be payable in 1854, will be only 214,000l., showing a saving of 152,000l. on the Exchequer bills of the year. As I have said, I did not expect under present circumstances that either I or any one else could effect any large saving. I am, therefore, very well content to take that small saving, when I can't get anything that is better; but I must confess that, in my view, that question of the annual saving is only a very small part of the question. I most sincerely wish that we were now discussing the subject of Exchequer bills, at a time when we might take a larger range, when a larger portion of the House was here, and when we might bring home to our minds many important considerations in regard to the unfunded debt. One thing, however, I am very desirous to say. There is an impression among the public that the unfunded debt, as it has been habitually managed up to the present time, is a cheap and economical portion of the public obligations. The examination of the subject has convinced me that that is an entire misconception, and that, on the contrary, the unfunded debt, in its practical operation, is the most expensive portion of the public obligations; and I will tell you why. The mode of management has been this:—In easy times Parliament has been content to 999 make the provision from year to year, gratified, perhaps, by the lowness of the rate of interest. In difficult times it has been necessary to raise the rate of interest; but the difficulty has been imminent, and it has been submitted to. But that is not the serious part of the question. The serious part of the question is this, and it is one which you may amend:—The practice has been, in easy times, to keep the amount of the capital of the unfunded debt up to what the state of the market would tolerably well bear. The consequence is, that in difficult times it has been found necessary from time to time to reduce the capital of your unfunded debt by commuting it into funded debt. That has been done not once, but over and over again. It was done in 1819, again in 1821, in 1826, in 1830, and in 1841. Upon every one of those five occasions it was done under difficulties, and when there was a pressure upon the money market. Now, has the Committee the smallest notion of the amount which has been added by these successive operations to the permanent obligations of the country? No less a sum than 48,800,000l. has passed since 1819 out of the condition of unfunded debt into the condition of funded debt. The choice which you have is this—will you reduce your unfunded debt in easy times or in difficult times? I have chosen the reduction of the unfunded debt in times comparatively easy. The consequence is this—3,100,000l. has been paid out of the public balances without causing any sensible inconvenience to the public. That is the course which I have taken, and that is the course for which the right hon. Gentleman calls me to account. The Exchequer-bill market has been relieved to the extent of that reduction, just the same as it would have been by funding, but with this difference to the public, that I venture to say that it has not cost the public one farthing. What would have been the case if, instead of that, I had let the unfunded debt remain where it was until we came into difficulties? I will show the Committee at what rates the capital of the unfunded debt has been funded in former times; and, remember, that which you call the unfunded debt, and which you look upon as temporary, has been passing from time to time into funded debt, and since 1819 has added 48,800,000l. to the public obligations. In 1819 you funded 27,000,000l., at the rate of about 5¼ per cent. In 1821 you funded 7,000,000l.; 1000 in 1826, 8,000,000l.; in 1830, 3,000,000l.; and in 1841, 3,800,000l., altogether the amount I have before mentioned, namely, 48,800,000l.; and the average rate of interest which the country is now paying for that 48,00,000l. is, as nearly as possible 5 per cent. There is, then, a permanent obligation entailed on the country of 5 per cent on 48,800,000l., which previously to 1819 was unfunded debt, but is now funded, and which arises from the practice of not funding till difficult times. It is fair to admit that the case is not quite so bad as it looks, because the funding of 1819 must be regarded as retrospective—it was effecting a transition from a war state to a peace state of finance. Deduct, therefore, the operations of 1819, and take the operation of the subsequent periods from 1821 to 1841, and it will be seen that the rates of interest at which the unfunded debt was funded from that time, after all, were not so much more favourable. The average rate was 4l. 6s. 8d. per cent, which is the permanent burden inflicted on the public in respect of each 100l. which was the capital of the unfunded debt. That is entailed for ever. I think I am justified, then, in the assertion that that unfunded debt is not the cheap and economical portion of the public obligations which it seems to be, but that, in point of fact, in the long run, where you watch its working, you will find that it is a very expensive portion of the public burdens. Even the rate of interest upon Exchequer bills, although we may be much gratified that it is 1d. or 1¼d. or 1¼d. a day, which are very moderate rates, are not quite so favourable as may be supposed, for if we take the average rate of Exchequer bills since 1816, it will be found to be 3l. 8s. per cent from 1816 to 1834; and during the last eighteen years, from 1835 to 1852, we have not been able to get it down to 3l., the average rate having been 3l. 2s. per cent. If the 3,100,000l. which has now been discharged from the unfunded debt, without costing the public any appreciable sum at the time, had been funded at the average rate at which funding has taken place since 1821, it would have entailed upon the country a permanent charge of 134,000l. a year. Had it been funded on terms more favourable than any funding that has heretofore taken place—that is, at the rate indicated by the average rate of Exchequer bills since 1834, at nearly 3¼ per cent, it would then have entailed a permanent charge on the country amount- 1001 ing to 96,000l. a year. I am glad that I have been led to go thus far, by way of opening to the Committee considerations which I think of the utmost importance with regard to the unfunded debt; and which I trust will lead the Committee and persons out of doors to suspect and to watch more closely and jealously those popular notions which are abroad on the subject. This is going beyond the mere defence of myself or the Government, and beyond the attack of the right hon. Gentleman; but, even as a matter of defence, I think that I am justified in tendering him the acknowledgments with which I set out, for having led the Committee into the discussion of the state of the unfunded debt. I do not advance this as a final statement. I have said distinctly that those different elements, the conversion of South Sea Stock, the state of the revenue, the state of the public balances, and the state of the unfunded debt, are all at present in essential relation with one another, and that you cannot form a final judgment on these operations until you have seen the liquidation which is to take place at the commencement or next year completed. You will then be in a condition to form a judgment. I do not ask you to form a judgment now. I think if you do so, that it must necessarily be immature, but, judging from the results of the operations on the unfunded debt hitherto, I say that they have been eminently favourable, and that they will be attended, in all probability, not only with temporarily, but with permanently, beneficial results to the public. I am sorry to have led the Committee so far into these subjects, and so far away from the question immediately before us; but, having entered into these explanations, I sincerely trust that the Committee will arrive at a favourable decision upon them, and will assent to the Resolutions which are now upon the table.
§ SIR FITZROY KELLYsaid, that when he had before addressed the Committee upon these Resolutions, he had done so in almost total ignorance of what the effect of them would be upon the public and the persons interested, supposing them to receive the sanction of Parliament. Even after the lengthened statement of the right hon. Gentleman, the objection which he entertained to this measure had not been obviated—that objection being that it gave a power to trustees to effect a commutation of the South Sea Stock without the full consent of all the per- 1002 sons who were directly or indirectly interested. It was impossible to conceal the fact that every person who had accepted these commutations had inflicted a very considerable loss upon himself; and when they found that the property of infants and of others was liable to be dealt with in the same fashion, he trusted that the Committee would be induced to reject these Resolutions. He regretted that there was no law officer of the Crown present, because he was convinced that the right hon. Gentleman was not aware of the legal effect of that—which he was doing. The Resolution permitted the South Sea Company to commute all or any part of their stocks standing in the name of the Accountants General. He had acquired some knowledge of the nature of this corporate body, and of the fund with which they had to deal, but not from any information given by the Government. It appeared to have escaped the attention of the framers of the Resolution that the stock of the Company was indivisible as regarded their shareholders; and if twenty, or any other number, of the shareholders were desirous of commuting, no Resolution of that House could empower them to do it. The impression seemed to be that every holder of South Sea Stock possessed an integral and distinct share, than which nothing could be more erroneous. Supposing an Act were to pass in accordance with the terms of this Resolution, it would be entirely inoperative. The Resolution assumed that every shareholder in the South Sea Company was entitled to a certain specific portion of the capital stock of the Company. But that was not so. The gross capital was 2,662,784l. 8s. 6d., a sum which was not divisible into specific portions. There was no part of their stock," payable in respect of shares," and the Resolution was framed for a state of things which did not exist. So much for the form of the Resolution. As to the scope of it, if it were fair and equitable that there should be another alternative of commuting the stock into 3¼ per cent stock, 1844, why was it not proposed with the original alternatives which had been embodied in Act of Parliament? It was a great injustice and wrong to make the proposal now that persons had accepted some of the new stocks, and lost 7 per cent of their capital by the representations of the Government. He challenged the Chancellor of the Exchequer to deny that every one of those persons who had commuted 1003 their stock into the 2½ per cent stock, or into the 3½ per cent stock, or into Exchequer bonds, had lost at least 7 per cent of their capital. They had not the advantage of the experience of daily sales; but if by bankruptcy, or any other event, holders were compelled to sell, it was the opinion of persons accustomed to deal with public securities, that the prices would be for the 110l. 2½ per cent stock, 93l.; for the 100l. Exchequer bonds, 91l.; and for the 82l. 10s., 3½, per cent stock 90l. Thus the loss varied from 7 to 10 per cent; and it was most unjust, when parties had, by the representations of the Government, incurred that loss, to offer a more favourable alternative to those who were actually in the same position with them. Looking to the calculations of the Government, he did not feel inclined to trust them unnecessarily with terms of a new bargain; and, therefore, he could not consent to this Resolution. He ventured to tell the right hon. Gentleman at the time his first proposition was before the House, it was most unwise, improvident, and injudicious, to tie the hands of the Government for forty years with a guarantee of any given degree of interest, whether small or large, and nothing had occurred since to make him retract that opinion. The right hon. Gentleman, in introducing the scheme, said one great object was, to extinguish and do away with these small stocks, which disturbed the ordinary course of financial operations. He then ventured to ask whether the effect of the Bill might not be to bring into existence three stocks still smaller than those it was proposed to extinguish? Events had shown the accuracy of his anticipations. It did not require a gentleman of the transcendent abilities of the Chancellor of the Exchequer to discover that the giving three alternatives was a great blot and blemish on the Bill. It was palpable to any one having an ordinary acquaintance with arithmetic; though he ventured to say the creation of three smaller stocks, to last for forty years, was a result which the right hon. Gentleman did not anticipate. He thought it was a fallacy to assert that the depression of the new funds could be attributed to the unfavourableness of the season, or any of the causes which had been assigned, as there had been no cause mentioned which should not have produced an equal depression in 3 per cents and other previously-existing securities. He believed that the holders had suffered solely from their 1004 blind and unwarranted confidence in the assurances of Ministers; and he hoped the right hon. Gentleman, instead of endeavouring to spread the evil, would apply his time and abilities to remedying the mischief which he had already done. He had directed the right hon. Gentleman's attention to the consideration of the possibility of giving effect to this Resolution by dealing with the holders of South Sea shares as if they had rights to integral portions of the capital stock of the Company; and he submitted that until these points were more satisfactorily settled, the Resolutions ought not to receive the sanction of the Committee.
MR. J. B. SMITHsaid, the right hon. Gentleman proposed by this Resolution to give to certain persons, who could not under the present Act avail themselves of the offers therein made, the same terms that were offered to the South Sea Company itself; but the right hon. Gentleman went further, and proposed that these persons should now have the advantage of a fresh arrangement—a new offer, much more advantageous than that which was offered to the South Sea Company. If this was carried into effect, they would see two distinct parties holding South Sea Stock—those who had made a bad bargain, and those who had made a good bargain; and who could doubt that the former of these would be highly dissatisfied with their position? He thought it was pretty evident that those who had not accepted the former proposition of the Government, had not lost anything by their holding back. The injustice done, was to those who had placed confidence in the right hon. Gentleman. He objected to this arrangement as wrong in principle, and must therefore oppose the Resolution.
§ SIR HENRY WILLOUGHBYwould not enter upon the question of the general policy of the Government; but with reference to the Resolution before the Committee his objections were very strong. The Chancellor of the Exchequer said there was a class of parties who were unable to take advantage of the present Act; but instead of confining himself to the terms of the Act, he introduced into the Resolution a fresh option—that of taking the 3¼ per cent stock of 1844. He must complain of the large powers conferred on the Treasury by this Resolution. He did not know a more dangerous licence than that of placing in the hands of the Treasury the power of dealing with persons as to 1005 the precise amount of stock they were to receive for their 100l. It would make them the greatest stockjobbers in the country. Then there could be no doubt that the fresh offer now made by the Government was an act of injustice to the holders of the new stock, and he believed nothing would eradicate from the minds of these parties a strong sense of that injustice.
§ MR. GLYNsaid, he should certainly agree with what had fallen from the hon. Member for Stockport (Mr. J. B. Smith) if he thought with him that this could be regarded as a new offer; but the words of the Resolution explicitly conveyed the meaning to be, that the parties now to be benefited were those parties who by some oversight, or some imperfect comprehension of their position when the previous Act was passed, had not the power of receiving any offer, or exercising any option whatever. The real question was, whether, in point of fact, it was more convenient for Her Majesty's Treasury to make arrangements with bodies like these, and with trustees, or with large classes of individuals? and, speaking practically, he thought there could be no question on the point. Everybody knew that the Chancellor of the Exchequer always went into the market to negotiate at a disadvantage; and the only way in which be could possibly be expected to negotiate with advantage in this instance was to be empowered to make over to the South Sea Company, in lieu of stock they now held, a certain portion of the stock of the national debt. He thought that a more economical, and in every respect a better, mode of dealing with the question than any that he had yet heard suggested. There was only one part of the statement of the Chancellor of the Exchequer which he disagreed with—he alluded to the announcement that it was not his intention to proceed with a Bill for the purpose of settling the question with regard to the funds in the hands of the Accountants General. He knew of no class of persons who were in a more hopeless or helpless position than those unfortunate people whose funds were in the Court of Chancery. They were so placed that every contingency operated against them, and nothing for them; and therefore he did hope that the right hon. Gentleman would give his attention to the subject, and not omit the very first occasion that presented itself of settling this very important question. With regard to the unfounded debt, 1006 he quite agreed with the Chancellor of the Exchequer as to the points at issue on that subject. He was willing to admit that the course he had taken—and which was forced upon him at the time—had been a beneficial one, for by it be was enabled to reduce the interest on the floating debt; and he was satisfied that the employment of the public balances in the way stated had done a positive good, even if there was no other merit attaching to it. The accumulation of these balances in the hands of the Bank every quarter had been a great evil; and if there was no other reason for applying them to the payment of the interest of the unfunded debt than to prevent this, he thought the reason would be a good one.
§ MR. SPOONER,said, he wished to know what was the amount they would have to deal with, provided the second Resolution was agreed to? He wished to call the attention of the Committee to a Bill which he held in his hand, which contained exactly the same provisions that were embodied in the Resolutions now before the Committee. All the arrangements in favour of the South Sea Company were in this Bill, just as he found them in the Resolutions, and he hoped some explanation of the connexion between the two would be given.
§ MR. J. WILSONsaid, the hon. Gentleman was quite right in saying there appeared to be an intimate connexion between the Resolutions and the object of the Bill he spoke of; but, nevertheless, the connexion was as wide as possible. The reason why these persons were unable to accept either of the options contained in the former Act was, that by the constitution of the South Sea Company they were unable to express any option whatever; and this Bill was introduced to enable them to avail themselves of the opportunity of converting their stock, should they choose so to do. They asked Parliament to enable them to avail themselves of that commutation if they thought it necessary, but it was a Bill with which the Government had nothing to do. It was, in fact, a private Bill for the convenience of the stockholders.
§ MR. WILKINSONsaid, he understood the right hon. Gentleman the Chancellor of the Exchequer to say that he would object to any new offer being made; but, were these new terms or were they not? They were made in favour of persons who were formerly disabled from accepting the 1007 offers they made; but still, to him they appeared to be new offers.
§ MR. SPOONERsaid, he wished to know whether the South Sea Company, as a Company, had not refused the terms offered, and whether the effect of this measure would not be to introduce a power of voting by persons that would override the vote of the corporation?
§ The CHANCELLOR OF THE EXCHEQUERsaid, he would answer, No; and in reply to a previous question of the hon. Gentleman, as to the amount of stock to be dealt with, he had to repeat what he had stated yesterday, that it would be something over 2,000,000l.
§ MR. DISRAELIsaid, as he knew that important business was to come before the House, he would detain them but a very short time; but he could not overlook one or two observations of the right hon. Gentleman. In the first place, he entirely protested against the new view taken by the Government that the failure of their great financial scheme was to be attributed to the state of the weather or of the Continent. The state of the weather or the Continent had nothing whatever to do with it. It was condemned at the first by all practical men, and he knew numerous instances in which funds were held by corporations and individuals who went for consultation to those whose opinions carried the greatest weight on this subject, and by whom the scheme was universally condemned. There was one society he recollected particularly—of which, he believed, the right hon. Gentleman was a member—the Society for the Propagation of the Gospel, which held 15,000l. in these small stocks, and they immediately consulted gentlemen well known to the Treasury, and of the highest reputation, who recommended them to have nothing to do with a proposition of so illusive a character. The only other observation he was bound to notice was that made by the right hon. Gentleman as to his manner of dealing with the unfunded debt of the country. The right hon. Gentleman had endeavoured to convey to the Committee and the country the impression that he had systematically and successfully dealt with the unfunded debt of the country. Now, the right hon. Gentleman had already received on this point a friendly reminder and reproof from the hon. Gentleman behind him, and generally a supporter of his. He reminded him that the Chancellor of the Exchequer was forced to take the course which he had taken in this matter. Now, 1008 he (Mr. Disraeli) entirely reprobated the principle of keeping up extravagant balances in the Exchequer; nor was he averse, when the proper opportunity occurred, to dealing with the unfunded debt of the country. But then he held that they should deal with the unfunded debt in such a manner that those securities should not be at a discount in the market. This was a feature in the right hon. Gentleman's career to which he had not adverted. He should like also to hear from the right hon. Gentleman what was the amount of those deficiency bills to which he so slightly alluded. He suspected they were larger than he seemed to think, and involved a greater amount than he had spoken of. He was certain that the amount of interest to be paid for these deficiency bills must be greater than the few hundreds of which he spoke, unless, indeed, the Bank of England had been giving him accommodation much below the rate of interest they were charging to the merchants of this country. If, instead of charging 2½ and 3 per cent, as they did to the bankers and merchants of this metropolis for accommodation, they were charging only 1 or 1½ per cent to the Government, then he thought they were dealing with the stock of the Bank in such a manner as to incur great responsibility, and for which it was not unlikely the holders of Bank stock would think it their duty to call them to account. He would not longer detain the Committee, but merely state that it was his intention to vote against the Resolution.
§ The Committee divided:—Ayes 117; Noes 67: Majority 50.
§ The Third Resolution was then read, as follows:—
"That the South Sea Company shall also be permitted, upon signifying their assent within such time as may be limited by the Commissioners of the Treasury for this purpose, to commute, upon the same terms, and subject to the same conditions, all or any part of the Annuity or Interest payable in respect of such further amount of their said Capital or Trading Stock as may be authorised or required by Parliament to be invested as a guarantee fund for their administration of private trusts, in case they should be authorised to undertake such administration by any Act to be passed in the present Session of Parliament."
§ The CHANCELLOR OF THE EXCHEQUERsaid, the last Resolution was one required by justice. It was unnecessary to make any remarks respecting it; but he wished to make one observation with reference to what had fallen from the hon. Member for North Warwickshire (Mr. Spooner). The hon. Gentleman seemed to 1009 think there was an occult relation between the private Bill to which he had referred, and this Resolution. Now, he would assure him that there was no design to ask the Committee, by agreeing to this Resolution, to prejudge the Bill in question. That Bill was to be considered on its own merits. The effect of this Resolution was, in case the House should see fit to confirm the Bill, to enable the South Sea Company, if it chose to arrange it amongst its proprietors, to continue public creditors without going through the form of liquidation and subsequent reinvestment; then that the Government should have power under the Resolution to deal with the Company in that way. It was merely an empowering Resotion, founded on the possibility that the House would adopt the Bill.
§ MR. NEWDEGATEsaid, the Committee had, in fact, prejudged the private Bill, as the whole scheme involved in the Resolutions went on the assumption that the South Sea Company would obtain the powers provided for by the Bill.
§ SIR FITZROY KELLYsaid, he would not divide the Committee upon this Resolution, but would reserve to himself the power of taking the sense of the House upon the principle involved at some other opportunity. In the meantime, he wished to know when the Bill to be founded on these Resolutions would be brought in?
§ The CHANCELLOR OF THE EXCHEQUERsaid, the Bill would be in the hands of hon. Members on Tuesday.
§ Resolution agreed to; House resumed.