Commons Sitting of 9 December 1857

MINUTES.
1° Sir Henry Havelock's Annuity. 3° Bank Issues Indemnity.
PENSION TO SIR HENRY HAVELOCK.

  THE QUEEN'S MESSAGE—REPORT.
  MR. FITZROYhaving brought up the Report agreed to by a Committee

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  of the whole House on the previous evening,
  COLONEL NORTH: Sir, I was unwilling last night to take up the time of the House by making any observations in reference to the suggestion of the hon. Member for Surrey (Mr. Briscoe), that the pension to General Havelock should extend to his successor, for I felt that the matter to which he directed the attention of the Government could not be in better hands than those of the noble Lord at the head of the Government, who I felt confident would give every attention to the hon. Member's suggestion. However, had I been aware last night of some of the circumstances attending Captain Havelock, the son of the distinguished officer whose services we propose to reward, I certainly should have felt bound to have risen to support the hon. Member in his appeal to the First Lord of the Treasury. It very seldom happens that the heir of a man who has so distinguished himself in the service of his country as General Havelock has done has had the opportunity of supporting his father in those deeds of valour which have obtained for the General not only the approbation of his Sovereign, but the admiration of the whole world. It was not until this morning I learned that Captain Havelock had participated in all those battles which had secured for his illustrious father undying fame; but I now understand that this young officer has also received the Victoria Cross. I am sure, under these circumstances, even a departure from the usual rule would be warranted in this case. But it appears that in the case of peerages conferred for services in the field the pensions generally extend for two generations. This being so, I do hope that Captain Havelock will be considered by the Government, and secured the same pension which has been provided for his most distinguished and gallant father. This would not be too much for the country to do, considering that the position of Sir Henry Havelock is such that the telegram expected this very day may announce to us that the gallant General has fallen in the service of his country, and that the baronetcy has descended to his son; and I think we must all of us be anxious to place the son in a condition to support a dignity so inherited. I make these observations feeling sure that from no one
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  will this suggestion meet a more ready attention than from the noble Lord at the head of the Government.
  MR. BAGWELLbegged, on the part of the Irish representatives and the Irish people, to express the very high sense which they entertained of the gallant conduct and glorious deeds of our soldiers in India. He took the liberty of doing so, though a new Member, in the absence of many of the Irish representatives, because he believed that all classes of people in Ireland and of their representatives in that House joined in doing honour to those brave and heroic men, and most cordially concurred with the Government in the reward which they proposed to confer upon General Havelock. His only regret was, that the pension granted to that distinguished soldier was so small, and that it was to last for so short a period, and he hoped that at some future time the Government would see the propriety of extending it beyond the life of its present gallant recipient. He hoped, however, that the gallant General would long live to serve his country and enjoy his pension; and that was the prayer of every Irishman and of every Irish Member of the House.
  MR. KINNAIRDsaid, it was perfectly unnecessary for him to say one word in praise of Sir Henry Havelock, who was about to receive the tribute of respect from a grateful country, which, indeed, the House could only regret was so inadequate to his merits; but he must say a few words in reference to another name borne by two of the most distinguished men, he would venture to say, of any age or country—men who had saved us, under God, he believed, from disasters far greater than those we now mourn over. The House must be aware that he referred to Sir Henry and Sir John Lawrence. The former had gone where no earthly honours are of avail, and he could no longer serve his country by his able statesmanship and his unrivalled tact and courage; and he trusted that to him his country would raise a fitting monument. But as far as they knew Sir John Lawrence still lived, and he confessed he should like to see him honoured as he deserved. Who saved the Punjab; nay, our Indian Empire? Who was the main instrument of re-establishing our power at Delhi? Who raised the soldiers which had enabled that vic-

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  torious column under Greathed to restore order where anarchy had reigned on her march south? Sir John Lawrence. He trusted the House would remember this fact, that not a soldier from Calcutta or Bombay had reached Delhi. Had we not had Sir John Lawrence in the Punjab, or one like him, he believed our forces would have been entirely driven out of the North-Western Provinces, accompanied by a terrible loss of life, even if we had retained our hold on Bengal. Difference of opinion had existed, and would exist, as to the wisdom of the measures taken in Calcutta; but there could be no room for difference here. He hoped to see the day when Sir John Lawrence should be in a position more commensurate with his experience and his administrative abilities.
  MR. GLADSTONE: I wish to say a word or two on this subject. I speak with unfeigned hesitation. I am sure that the sentiments of sympathy and admiration which my hon. Friend has just expressed are common to the whole of this country; but at the same time I would with all respect and deference venture to suggest to him the expediency of our endeavouring to put some restraint on our feelings in this matter. Surely, nothing can be more important than that it should be left to the Crown and the Executive Government to administer the function of reward without being subjected to the constant anticipation of the Members of this House. I entreat Gentlemen to recollect how much is taken from the grace and value of these acts of reward when bestowed by the Crown if they have been suggested by individual Members of this House. Of course I fully admit that it is the duty of this House to watch the conduct of the Executive Government, and to call it to account if any slackness is exhibited in the due reward of merit; but here is a case where I humbly think we are not as yet entitled to say there has been any such slackness. Let us consider the importance of time in these matters, let us consider that we are dealing with transactions still in progress, that the service of Sir John Lawrence and those other heroes to whom we owe so much is an unbroken and as yet uncompleted service, and that the proportion of reward must depend in no inconsiderable degree on the precise time at which it is administered and the ripeness to which events
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  have attained. How is it possible that we who draw our information with regard to these occurrences from the public journals, and who form impressions that are necessarily general, can take into our hands the duty of pointing out to the Executive Government what is the precise moment at which rewards shall be given? I venture to say—without in the slightest degree denying the title and privilege of Members of this House to correct what is wrong, or what they think wrong, in the conduct of the Executive Government—that it is greatly to the advantage of society and greatly for the honour of the Crown that they should leave the Crown some latitude and discretion as to the time, and the opportunity, and the way in which such rewards should be bestowed; because, if it becomes the habit to take into our hands the business of pointing out beforehand the disposal of individual and particular rewards, the ultimate effect will be that the distribution of rewards, which, given wisely, are intended to be a means of strengthening the Executive Government, will, on the contrary, become a source of weakness. I hope I shall not be understood as in the slightest degree censuring those honourable feelings with which Gentlemen have been actuated in bringing these matters before the Government, but I have thought it my duty to point out the important considerations of policy which I think are involved in the question.
  COLONEL NORTHsaid, he had not the slightest idea of dictating to the Government. He had merely given his support to a suggestion which had been brought under the notice of the House on the previous evening.
  MR. E. BALLsaid, he thought it was the duty of the House to supply any omission made by the Government in the bestowal of rewards. The services of a great General had been brought under their notice, and they were asked to co-operate with the Government in honouring and remunerating him for those services. It was suggested that the pension bestowed on that distinguished General should descend to his son. That was a very simple suggestion, and he thought the hon. and gallant Colonel, as being a member of the same profession as General Havelock, was a very proper person to make it Therefore be did not see the propriety

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  of the right hon. Gentleman the Member for the University of Oxford finding fault with such a proposal, and endeavouring to divert the attention of the House from the claims of the gallant young officer whose services had been brought before them.
  SIR WALTER FARQUHARcould not but express his deep and intense admiration of everything that had been done by the gallant General Havelock and the troops he had the honour to command. He entered deeply into every word that had been expressed with reference to the heroism of those men and the privations they had undergone, and having himself a son at Lucknow the House would understand the feelings with which he was animated. Concurring in all that had fallen last night from the noble Lord at the head of the Government, he must at the same time agree in every word that had come from the hon. and gallant Member for Oxfordshire (Colonel North). He hoped that as the distinction conferred upon the father was conferred also upon the son, the pension would in this case be permitted to descend with the title.
  SIR JOHN PAKINGTON: I waited to address a few observations to the House till the right hon. Gentleman the President of the Board of Control had entered the House, and he will excuse me when I say we have reason to complain that when such a subject as that of the reward to be conferred on General Havelock stood as the first Order of the Day, the right hon. Gentleman was not in his place to answer any questions which it was so probable might on such an occasion be addressed to him. I believe, now that this question is before the House, the present is a legitimate time for me to put two questions to the right hon. Gentleman with regard to the affairs of India, on which I am anxious to receive some information from Her Majesty's Government. Before, however, I put these questions, I cannot refrain from taking some notice of what has fallen from my right hon. Friend the Member for the University of Oxford. Although I admit what he has said has very considerable weight in reference to any honour and reward which may be proposed in future for that distinguished man, Sir John Lawrence, or any man that deserves to be rewarded by the Crown—for I quite agree with my right
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  hon. Friend that the premature interference of this House on such occasions might have the effect of diminishing the race of those favours when distributed—I at the same time think that the question before us, the bestowal of a pension on Sir Henry Havelock, is not one to which the remarks of my right hon. Friend will apply. I therefore hope that those observations, correct as they were as applied generally, will have no tendency to check, on the part of Members of this House, those expressions of feeling, which, in my opinion, do honour to the House, in regard of those great services which have been performed by our army in India. I believe in the truth of an observation made the other evening by my right hon. Friend the Member for Buckinghamshire—that no reward these men can receive will be so appreciated as the assurance that their services are estimated by their countrymen; and the most legitimate mode in which they can receive that assurance is by the expression of the feeling of the constituencies through their representatives in Parliament. I am sure, Sir, that the Resolution of last night and the discussion to which it gave rise will be received in India with gratitude and pride, and that our brave soldiers will esteem our proceedings here as the greatest honour which can be conferred on them. I must confess that when I seconded the Motion of the noble Lord at the head of the Government last night I felt that the only doubt which could exist was as to whether the reward proposed was adequate to the services of General Havelock; and that being my feeling I quite agree with what has fallen from my hon. and gallant Friend near me (Colonel North), that considering the very distinguished gallantry displayed by Captain Havelock—considering the advanced age of General Havelock—and considering the fact, which it is no harm to mention in this House, because it is one generally known, that General Havelock is not a man of large private property—as Her Majesty has been pleased to bestow an hereditary title on this illustrious General, it would be only meeting the wishes of Parliament if the Government allow the pension about to be granted to him to descend to his son, Captain Havelock. I only hope that after what has passed in this House Her Majesty's Government will take that matter into consider-

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  ation. Now with respect to the inquiries which I have to make, and which have reference to very different matters. The first to which I shall refer is one of which I gave notice on a former occasion, and relates to what is called the "dive Fund." If the right hon. Gentleman the President of the Board of Control wishes to make inquiry on the subject, I shall defer my inquiry to another day. It is probably within his knowledge that in 1765 Lord Clive, on receiving a legacy of £70,000, bequeathed to him by Meer Jaffier, generously paid that large sum into the treasury—
  SIR H. WILLOUGHBY: I rise to order. Is it competent to the right hon. Baronet, on a question concerning the pension to be granted to General Have-lock, to introduce different matter—to ask questions so totally at variance with that which is now occupying the attention of the House?
  MR. SPEAKER: If I understand the right hon. Baronet correctly that he proposes now to ask questions on matters not immediately relevant to the subject under discussion, and especially questions of which he has already given notice of his intention to put on a particular occasion, I cannot hesitate to say that it would not be in accordance with the rules of the House to take such a course.
  SIR JOHN PAKINGTON: I shall of course bow at once when I understand your decision, Sir; hut at present I do not quite see the position in which I stand. I did on a former evening express my intention to put a question to the right hon. Gentleman, and notice of that question was given for last night. However, I did not put the question last night, and there is now no notice on the paper of that question; and therefore I apprehend I am not out of order in putting it now. As I understand our rules, when any question in the nature of Supply is before the House, it is a most legitimate and proper opportunity to raise any question which may require explanation. My first question has reference to the Clive Fund, and my other to what I consider to have been a most improper exercise of patronage by the Board of Control and the East India Directors—
  MR. SPEAKER: The right hon. Baronet is quite correct, that when a Motion
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  is made for the House to go into a Committee of Supply general observations may be made and questions asked; but we are engaged now on a particular Vote, and the Motion to go into a Committee of Supply stands next in order. With regard to the questions of the right hon. Baronet, I think that, according to the strict rules of the House, on a subject such as this—a distinct Vote for General Havelock—to introduce irrelevant questions—questions not confined to the subject before us—would not be in accordance with the general course of our proceedings.
  SIR JOHN PAKINGTON: I bow to your opinion, Sir; and will give notice of my questions for another night.
  MR. VERNON SMITH: The right hon. Gentleman (Sir John Pakington) began by reading me a lecture—which is rather a habit of his—for not being present when the question of General Havelock's pension came before the House. I certainly did think there was no possible chance of any attack being made on the office I have the honour to represent, seeing that the proposal of the Government met with the unanimous assent of the House last night. It appears to me that the right hon. Gentleman is wroth with me for not being here when he wanted to put two of the most irregular questions ever put in this House. I had no obligation to be here, seeing that no notice was given me that such questions were to be put; but I am ready notwithstanding to state the reasons why I was not here. I was not here, because we had just received a telegram from India which I shall read to the House, and which I have no doubt the House and the country will feel to be of more importance than the questions of the right hon. Baronet. I will only say that in the manner in which he dealt with the question the right hon. Gentleman left it most unfairly. He knew that the answer to the question about the Clive Fund would involve a great array of figures and require very close inquiry. As regards the other question, which involves a charge against me of a most improper exercise of patronage, I never heard a man make such a statement as that without being ready to stand up and substantiate it on the spot. I shall now read the telegram which——
  MR. SPEAKER: When any hon. Member wishes to make an explanation on any personal matter, the House generally allows him to do so; but the right hon. Baronet the Member for Droitwich having refrained from putting his questions, and having given notice of his intention to put them on a future occasion, I would suggest to the right hon. Gentleman the President of the Board of Control that it would be more convenient for him to reserve his answers till the questions are put.
  MR. VERNON SMITHsaid, he had no intention whatever of prolonging the discussion on the subject of the questions of the right hon. Gentleman the Member for Droitwich; but was about to read the telegrams just received [which the right hon. Gentleman then did].
  SIR HENRY WILLOUGHBYassured the right hon. Baronet (Sir John Pakington) that, in raising the point of order, he had no intention of offering him any interruption in the expression of his opinion. He was actuated only by the belief that the observations of the right hon. Gentleman could be made more conveniently at another time. He had not understood the right hon. Gentleman the Member for the University of Oxford as wishing to prevent the Members of that House from expressing their opinion as to the merits of distinguished officers; but what he did understand him as saying was, that by putting forward for rewards particular names—and no doubt each Member in that House could select a dozen—they would infringe upon one of the first principles of the constitution, which made the Crown the fountain of honour. With regard to the present Vote, he himself had been anxious to call the attention of the Government to the propriety of making some moderate provision for Lady Barnard, the widow of General Barnard; but feeling that the question was one which should rather originate with Her Majesty's advisers, he refrained from doing so, and would content himself with saying that he cordially concurred in the Report before the House.
  Resolution agreed to.
  Bill ordered to be brought in by Mr. FITZROY, the CHANCELLOR OF THE EXCHEQUER, and Viscount PALMERSTON.

SUPPLY—THE CLIVE FUND—ARMY PATRONAGE (INDIA).

  QUESTIONS.
  MR. FITZROYreported a Resolution from the Committee to whom it was referred to consider the Motion, that a Supply he granted to Her Majesty; which was read as followeth; That a Supply be granted to Her Majesty.
  SIR J. PAKINGTON: Sir, I trust that I am now in order, and may address to the right hon. Gentleman the President of the Board of Control the question to which I have already referred. I am extremely sorry at having made the right hon. Gentleman so angry as he appeared to be just now; but when he accused me, as he did, of being in the habit of lecturing the Members of this House, he will allow me to say that I do not think I have ever lectured anybody since I have had the honour of a seat in this House as he did me in the course of the last few minutes. What was the gravamen of his charge? He said that I had complained of what I thought an improper exercise of patronage on the part of the Board of Control and the Directors of the East India Company, and then that I had refrained from doing that which I ought to have done—namely, risen in my place and substantiated the charge on the spot. Well, the only reason that I did not do so was that you, Sir, had decided that I was not in order. The right hon. Gentleman will see, however, that I am now putting my question at as early an opportunity as circumstances will allow. My first question relates to the Clive Fund. On Monday evening he was sitting opposite to me, when, in order that he might be aware of my intention, I read in his presence the terms of the question I intended to put to him; but if, notwithstanding that public notice, the right hon. Gentleman wishes for further time to answer the question—for I do not put it with the view of giving pain to him or to anybody else—I put it merely to elicit information, which seems to me of peculiar interest at this moment, and especially in connection with that fund which is being raised all over the country with so much generosity and alacrity for the relief of the sufferers by the rebellion in India—I shall be happy to postpone it to another occasion. Now, in 1765 the great Lord

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  Clive generously devoted a legacy of £70,000, which he received from Meer Jaffier, to what I call a most charitable object. He paid that sum into the treasury of the East India Company at Calcutta, and devoted the interest of it to the relief and support of decayed or disabled European officers and soldiers serving in India, and to the relief and support of the widows and orphans of European officers and soldiers who might die in the service in India. Now, the question I wish to put to the right hon. Gentleman is, whether he can inform the House what is the present state and condition of that fund? It is now nearly a century since that sum of money was devoted by Lord Clive to this noble purpose. I do not know what may have been done with the interest of this fund, but I think it would be satisfactory to the country at this moment, when efforts are being made to alleviate the distress consequent upon the Indian mutinies, if the right hon. Gentleman could state what is the present condition of the fund; whether the interest has accumulated; whether the fund is still devoted to its original object; and whether—and this is the important part of the question—it holds out any means of affording additional supplies from which the sufferings of European soldiers and their families in India may be relieved? The other question which I desire to put to the right hon. Gentleman I also beg to assure him I put in the most perfect frankness and fairness, and with the sole object of eliciting information. I may be wrongly informed, or I may put a wrong construction upon the facts to which I am about to advert; but I do not shrink from saying, that if I am correct in regard to the facts, I do think they amount to an improper and unwise exercise of Indian patronage at this particular moment. What I refer to is a statement which I have seen in the public newspapers, with regard to what is called the arrangement of patronage for the year 1858. I find it there asserted that 110 infantry cadets are to be sent out to Bengal for the year 1858. Mention is also made of a considerable number of cavalry cadets; I forget how many. But the point I wish to call the attention of the House and the Government to is this exercise of patronage, and the sending out of 110 infantry cadets for the Bengal Native army. What, at the present mo-
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  ment, is the condition of that army? I believe I am stating the facts correctly when I remind the House that of the Bengal Native army forty-six regiments have mutinied, and two have been disarmed and disbanded. Indeed, I believe I am speaking within, rather than beyond the facts in making that statement. Assuming it, however, to be correct that forty-eight regiments of the Bengal Native army are practically gone, where, I should like to know, are the officers of those regiments? Those officers would, I believe, amount to not less than 1100, from which number you must deduct a certain proportion who have died, and a certain proportion who are holding staff or civil appointments. But, after allowing for those who have died and those who are holding civil offices, I do not think that I am in the least overstating the facts when I say that at this moment there must be a body of between 600 and 700 officers who are holding commissions in Native regiments, and who, in consequence of the mutiny or disbanding of their regiments, are wholly unemployed. I put it to the House and to Her Majesty's Government, then, whether, considering that there are 600 or 700 officers unemployed, for whom the Indian Government is bound in honour and in fact to provide in some way or other, they have chosen the right time to exercise their patronage at home by sending out 110 military cadets to be added to the officers in the Bengal Native regiments, and which regiments, in truth, have not an existence? Under the regulations of the East India Company, I believe these cadets, when once appointed, will have a claim upon the Government for gradual promotion and subsequent employment. Every one of them, therefore, may ultimately rise to be a general in the service. I make this complaint subject to correction, either in regard to the facts, or in regard to the construction which I put upon the facts. But I do think it to be a state of things that ought to be brought under the notice of Parliament, and of which we are entitled to have some explanation; because it seems to me that the 600 or 700 officers who are unemployed might be made available either for the remaining Native regiments, or newly raised regiments; that the step which has been taken is not a proper exercise of patronage; and that in a financial point of view it is ob-

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  jectionable and unfair for the Government of India to have these 110 persons imposed upon them hereafter as military officers.
  MR. VERNON SMITH: To the first question put to me by the right hon. Gentleman relative to the Clive Fund, I must reply that, although I was entering the House when he gave notice that he intended to ask it, yet, that, seeing it was not contained in the printed paper next morning, I concluded that the right hon. Gentleman, for some reason best known to himself, did not intend to ask it; and therefore I did not come down provided with the information which was necessary to enable me to answer him. As it is a question which involves, as I said before, a great number of figures and details in reference to the present pecuniary position of a particular fund, I think it would be better that I should abstain from attempting to answer it until the right hon. Gentleman puts it on some future occasion, when I have been furnished with the information he requires. "With regard to the second question, I must say that, to put it without notice, and, as he says, for the purpose of eliciting proper information, is not the way of putting it to the best advantage. For instance, I provided myself the other day with papers to enable a noble Friend of mine to answer a similar question relating to cadetships, which had been put by the Earl of Ellenborough in the House of Lords. I have not seen to-day whether that question has been asked or not; but my noble "Friend is still in possession of the papers, or I should be quite ready to reply to the inquiry of the right hon. Gentleman now. As, however, his question involves a charge in reference to the exercise of patronage by the Government, I may be permitted to say that he is not correct in his estimate of the number of officers killed in India, and that I am afraid he will find it to be a great deal more than he supposes. The supply of cadets is intended to make good the loss of ensigns in the regiments; and the distribution of the appointments rests with the East India Directors; for although, of course, the Board of Control may interfere, it is not usual for them to do so. "What is done is done under an Act of Parliament; but the only communication habitually made to the Board of Control relative to the ap-
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  pointments is a private communication, and it is very seldom that the Board of Control has interfered. The fact is that the distribution of these appointments by the Court of Directors in the present instance has not supplied anything like the number of vacancies that exist. The right hon. Gentleman talks of the Native infantry having been disbanded and disarmed; but surely he does not imagine that we are about to conduct the military affairs of India without any Native troops whatever. It is not to be supposed that for purposes of police and escort alone we could do with less than half the number of Native infantry hitherto existing, and the estimate made by the Court of Directors, I am assured by them, would not supply one-half the Bengal infantry regiments still existing, and I do not believe that any one supposes that we are to go on with less than half that number. The officers of whom the right hon. Gentleman has spoken as now unemployed would almost all of them be officers of higher rank, and it would be absolutely necessary to supply the loss of ensigns in any circumstances under which India may hereafter be governed. That is the explanation which the Directors will give of their present proceedings. They have considered the subject maturely, and if the right hon. Gentleman imagines that, for the sake of the exercise of patronage, they have filled up the vacancies in any other than the ordinary method, he is greatly mistaken. With regard to some of the officers who have been thrown out of employment by recent events the Directors hope to employ them again in those regiments of cavalry below the standard of the Horse Guards, which the East India Company are raising and about to send out to India. If this explanation is not satisfactory to the right hon. Gentleman, I shall be happy to give him more precise information if he will repeat his question on another occasion.
  SIR JOHN PAKINGTON: How many Bengal regiments remain?
  MR. VERNON SMITH: Very few indeed, I am afraid; I cannot say the exact number.

SUPPLY—FINANCE—QUESTIONS.
SIR HENRY WILLOUGHBYsaid, he wished to take that opportunity of putting a question or two to the Chan-

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cellor of the Exchequer relative to some matters of finance. He understood that it was not the intention of the Government to take Supply until after the Christmas recess; but he would like to know whether they contemplated proposing any arrangement founded upon the Report of the Committee on Public Monies, and one of whose recommendations was the appointment of a Committee of the House to revise matters of public finance? He also wished to know if it were possible to place upon the table of the House an estimate of the expense that would be thrown upon the East India Company in consequence of the great increase of British troops in India? He asked this question because he feared that sooner or later, and in some shape or other, some portion of the charge would fall upon this country; and he was anxious to know if it were possible to produce the estimates of these expenses, and the means by which it was proposed to meet them out of the Indian revenue, so that the public might be set at ease upon a point in reference to which considerable anxiety prevailed—namely, that ultimately a heavy charge would have to be borne by the Imperial revenue. At any rate, he wished that the House should have some opportunity of looking at these charges before they were incurred, instead of only being called upon to sanction them afterwards. Another subject upon which he should be glad of some explanation was the state of the public bonded debt of the East India Company. At present it was in a state of discount and much depression; and he should like to be informed whether there had been any interference on the part of Her Majesty's Government which prevented the Directors of the East India Company from taking those measures which were necessary to sustain the credit of their bonds. If in addition to that information the right hon. Gentleman would state the means by which the Directors proposed to meet these various expenses, it would be satisfactory both to the House and the country.
MR. HUDSONsaid, he was sorry the President of the Board of Control had left the House immediately upon replying to the question of Sir John Pakington. He thought it was most desirable that the right hon. Gentleman should have remained in his place during the discussion of a subject which was re-
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garded with such interest by the whole community. The question how India should be governed in future was a grave and an important one; and he was of opinion that the appointment of a large number of cadets should not have been made until the House had determined that question. It was perfectly clear, judging from recent events, that it would be decidedly wrong to maintain so largo a number of Native troops again in that portion of our dominions. Not that he meant to say that a certain number should not be retained, but it was a grave question whether, after the treachery and ferocity which had been displayed by the Sepoy troops, they should be employed in large numbers in future. For his part, he thought it would be preferable to maintain a greater European force in India, as well for the peace and security of the inhabitants themselves, as for the preservation and the retention of our own supremacy. He also concurred with the right hon. Baronet (Sir J. Pakington) in thinking that the President of the Board of Control, who was the representative of that Board in this House, should have exercised some control over the new appointments—at all events until Parliament had carefully inquired into the larger and more general question. He repeated that in his opinion the wisdom of making these appointments was not apparent at the present time, especially as there could be little doubt that an altogether new system of government must be adopted for India; that was to say, if we did not wish to wake up some morning and discover that our power in that country was at an end. It was most desirable, therefore, that the East India Company should not be allowed to step in and prevent the free action of Parliament by making any appointments except those which were absolutely necessary, and it would be satisfactory, alike to the House and the country, if Her Majesty's Ministers would give an assurance that the question of the government of India should come before the House at an early day, unincumbered with a large number of these new appointments. The fact was, that Parliament had been content to remain for too long a period ignorant of the affairs of India, and to leave them entirely in the hands of the gentlemen of Leadenhall Street. Before he sat down he could not help again observing, that the President

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of the Board of Control should have left the House while the affairs of India were under discussion was not very respectful to the House.
THE CHANCELLOR OF THE EXCHEQUER: I am sure that nothing was further from the mind of my right hon. Friend than that of being guilty of any disrespect towards this House. But the fact is that we are not now in Committee of Supply, as the hon. Member for Sunderland (Mr. Hudson) seems to think. A Report has merely been brought up, and the Speaker is in the chair, and as my right hon. Friend has already addressed the House, even if he had remained here he could not, in point of order, have risen again and answered the remarks of the hon. Gentleman. Besides which I can imagine nothing more inconvenient than upon a formal stage like the bringing up a Report of Committee of Supply to enter into a general discussion of our Indian policy, without notice, and at a moment when hon. Members who might wish to take part in such a discussion are absent. I will not, therefore, follow the hon. Gentleman into any general debate upon either the state of India or the means of reforming the Indian government, believing that I should not be meeting the views of the House if I adopted such a course. I will therefore proceed to answer the questions put to me by the hon. Member for Evesham (Sir H. Willoughby). The hon. Member has asked me a question with regard to the Report of the Select Committee of last Session upon the subject of Public Monies; and I beg to state, in reply, that I have had that Report carefully under consideration during the recess; that it is the intention of the Treasury to prepare a Minute containing their views upon the subject; and that after the Christmas holidays I shall lay a copy of that Minute upon the table of the House, and at the same time explain the views of Her Majesty's Government in reference to it, and also the steps which they think it desirable to pursue. The hon. Baronet next asked whether any estimates could be furnished of the probable expense to the East India Company of the additional European regiments sent out to India. Now, all estimates of that sort are necessarily somewhat imperfect; but I have no doubt that it will be in the power of the Government to furnish some proximate estimate
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at all events, to show what will be the additional charge brought upon the revenues of India under that head. There is one point that I wish to explain to the House. It is, that there are certain advances made to the Indian treasury out of the Votes of this year. The practice is to advance the pay of all troops sent out four months, and certain stores and other things have been furnished to the East India Company out of the Votes of the present year. These charges will come to be repaid by the East India Company. But the House, I think, must be aware that this is a moment in which it is difficult for the East India Company to make the repayments with great rapidity, and therefore, that there is a prospect of some additional charge in the nature of advances—not in the nature of an ultimate charge—which will come upon the military and naval Votes, and particularly upon the Army Estimates of the present year. That may somewhat increase the temporary charge in the Votes of this year beyond the Estimates of last Session. But the revenue of the British Government is amply sufficient, as anybody may see who will look at the state of the public deposits, as shown by the Bank returns lately laid upon the table of the House, to meet any possible exigencies in our expenditure. That is my answer to the second question of the hon. Baronet. His third question relates to the bonded debt of the East India Company. First, he asks, whether it is true that the Government have refused permission to the Court of Directors to raise the rate of interest on India bonds? I have no doubt that the hon. Baronet has received correct information upon that subject. [Sir H. WILLOUGHBY: It was merely a guess.] Then the hon. Baronet's guess is certainly quite correct. It is true that the Board of Control, with the consent of Her Majesty's Government—myself among the number—did concur in refusing permission to the East India Company to raise the rate of interest upon their bonds. And they did it for this reason—they thought that the depression in the value of India bonds was owing to extraordinary causes. It was before Delhi was taken, and whilst the mutiny was raging at its highest point; the depression seemed rather to affect the credit of the East India Company itself, and the probable receipts of the India revenues; it appeared to re-

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late rather to the value of the principal of the bonds themselves than the rate of interest; and therefore it was not deemed advisable that the East India Company should take any step with regard to the rate of interest until the cause of the depression had passed away. There was no necessity at that moment for raising the rate of interest. A year's notice must be given before the bonds can be paid off; and it seemed to us undesirable, in that state of things, for the Company to bring an additional charge upon their revenue, merely for the purpose of supporting the character and credit of their bonds, when it was manifest that that credit and character was not impugned, and that whatever depression existed was owing to the political causes which it was hoped would speedily cease. This, Sir, is the ground upon which the Government refused to give their assent to the resolution of the Court of Directors, and I am prepared to defend their refusal in case any Gentleman in this House should impugn it. The amount which the Indian Government is authorized to raise on bonds is £7,000,000. I will only state in reference to the general remarks of the hon. Baronet, that the expenditure of India has never hitherto, to my knowledge, been a source of expense to this country. I am not aware that the British Exchequer has at any time been charged with the expense of Indian wars, that any contribution to the expenditure of the Indian Government has ever been made by England, or that even a loan contracted by the Indian Government has ever been guaranteed by Act of Parliament. Hitherto, the whole of the expenditure of India has been borne by the revenues and resources of India, and I think we must look to the continuance of that state of things as soon as India shall have passed through the present crisis. It is possible that, whilst the present state of anarchy which prevails in some of the provinces continues, the Indian Treasury may be unable to meet some of its current expenses; that its means of borrowing may be somewhat crippled; and that some limited or temporary assistance may be required from this House. And I feel sure that if, upon a full statement of the Indian finances, of the revenue, and of the expenditure, which will be made to Parliament in due time, it should appear that some assistance may be requisite,
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this House, which is always ready to give a fair consideration to questions of that sort, would not hesitate to do what may be necessary for the maintenance of our empire in India. At the same time I am bound to state that, as at present advised, I do not anticipate any large or serious charge upon this country arising out of the necessities of the Indian Treasury. My belief is, that the Indian revenues will be found before long sufficient to meet a large part of the current expenses; that the credit of the Company will be sufficiently restored to enable them to borrow that which may be necessary to supply a deficiency; and although, in case of necessity, I should not hesitate to appeal to the liberality of Parliament, I do not anticipate that there will be occasion for making any formidable demand upon that liberality. I hope the House will see that I do not venture to speak with any confidence at present in regard to a future which is necessarily uncertain. I speak only from the accounts which have hitherto been received. I do not undertake to predict with certainty that which may happen in the next few months. We see how rapidly events alter in a short space of time; but what I am now stating I am stating as the best judgment which Her Majesty's Government can form with reference to the past; and I trust that the House will understand me as having spoken with that necessary receive which the progress of a mutiny ending in a more general revolt necessarily demands.
MR. W. WILLIAMSasked, whether the advances to the East India Company had been made out of any surplus in the Votes of last Session? And if so, from what department of the public expenditure that surplus has been derived?
THE CHANCELLOR OF THE EXCHEQUER: The course which has been followed in this instance is exactly similar to the course which has been followed in previous years with respect to advances to the East India Company. But inasmuch as the present advances have been made upon a larger scale they lead to more important consequences. The practice has always been for the British Treasury to pay the troops shipped for India four months in advance, this four months' pay being afterwards repaid by the Indian Treasury. I need hardly inform the House that the number

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of European regiments sent to India has been in general very limited, whereas this year it has been extraordinarily large. Therefore, with regard both to the advance of pay and the advance of stores, the same practice has been pursued this year as in former years. But from the circumstance of our sending out some 40,000 men, instead of 1500 or 2000, it is clear that the temporary charge thus brought upon the British Exchequer must be much greater than in ordinary years. It is, however, merely the ordinary practice multiplied by a different figure, and the surplus of which the hon. Member speaks is nothing more than advances made out of the Votes for the year. They are perfectly regular and legal payments; but it was not foreseen to what extent the advances would go at the time the Estimates were prepared and the Votes were agreed to by this House.
The said Resolution being read a second time, was agreed to, Nemine contradicente.
Resolved,
"That this House will, upon Friday next, resolve itself into a Committee to consider of the Supply granted to Her Majesty."

BANK ISSUES INDEMNITY BILL.
The Order of the Day for the third reading read.
Motion made, and Question proposed, "That the Bill be now read a third time."
SIR HENRY WILLOUGHBYsaid, that the effect of this Bill would be to make an alteration in the currency law of the kingdom for the space of nearly three months, by giving the Bank of England power to issue paper to an unlimited extent for that period, upon securities, so long as the rate of discount is kept up at 10 per cent. That was rather an important change in the law. and he could not help thinking that the Bill had been passed upon insufficient evidence, and that Parliament ought to have more distinct information of the causes that had led to the necessity of the suspension of the Bank Act than it had hitherto had. On the second reading of the Bill he asked the right hon. Gentleman the Chancellor of the Exchequer whether he was aware of any undue strain or pressure that had been brought upon the resources of the Bank of England to produce this state of
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things, and it was very satisfactory to him to hear from the right hon. Gentleman that he was not aware of any such pressure. But there might, after all, have been such a pressure, and yet the right hon. Gentleman might be the very last person to hear of it, and he thought, therefore, this important matter should not be made to rest upon the statement of any Minister, however high in office. He contended then, and he still contended, that it was the duty of the House itself to make itself acquainted with the causes that had led to the late suspension, and to know what was the precise action brought to bear upon the Bank of England before they came to the right hon. Gentleman to ask for a suspension. He must remind the House of what was stated in evidence by Mr. Chapman, than whom no man was more likely to know, that such was the position of our currency law that it was in the power of any great capitalist to act upon it in a manner the most prejudicial to the public interests. He stated that it was in the power of any great capitalist so to deal with £1,000,000 or £2,000,000 of Consols that he might get hold of bank-notes for them and withdraw them from circulation. If that were done when the Bank resources were otherwise in a low state, it would be productive of most serious consequences to the country. He knew a case where at a time when the usual rate of discount was 6 per cent, a gentleman on the Stock Exchange borrowed £50,000 at 6½ per cent, another £50.000 at 7 per cent, and £100,000 at 8 per cent. At first no one could understand the meaning, but it turned out that in consequence of the action that had been produced upon the reserves this gentleman fancied he saw a storm coming, and wished to secure himself by borrowing money at these rates. Now, he would ask, was that a safe state in which to leave the currency? Would they give facilities to parties to act in that way? What he wanted was a Committee, not to plunge into the general question of banking, but to inquire into all the facts that had taken place in the City within the last six weeks, and then to leave the House to draw its own inferences and to apply a remedy, if a remedy were required. Some very curious facts had come out in the course of last week. There had been distinct allegations of unfair play contained in the City article

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of The Times of the 17th November. When that statement was coupled with the evidence given before the House of Commons' Committee that such things were possible, it became very desirable that all that had taken place should be known and put on record. He wished to ask the right hon. Gentleman whether any facts had come to his knowledge to the effect that at a time when the Bank reserves were very low, say on the 13th of November, one great bill-discounter had gone to the Bank of England and asked for nearly a million of money. If that were true it showed the critical state of our finances, for it was also said that because the demands were not satisfied at the moment a rumour arose that the bill-discounter had been refused. That, no doubt, would greatly aggravate the pressure till the appearance of the Government letter advising the Bank Directors to break the law. He did not complain of that, but he thought the responsibility ought not to be thrown upon the Prime Minister and the Chancellor of the Exchequer; the letter ought to be issued by authority of the Queen in Council. There was another question to which he wished for a moment to advert. He understood the Chancellor of the Exchequer to deny the other evening the correctness of the proposition that the issue of bank-notes on securities had in any way debased the currency, and altered the value of all contracts. Now it might be very true that all that had been done had a very slight effect on the currency; but he submitted to the House that if only £ 14,500,000 of notes could be issued upon securities by law, and if other parties could induce the Government to issue £2,000,000 more, there was pro tanto a cheapening of the currency; and that was all that was contended for by those gentlemen to whose views the Chancellor of the Exchequer objected. If the amount had been £10,000,000 instead of £2,000,000, then, he apprehended, there would be no dispute about the effects of the alteration, that the currency would have been cheapened, and the relations of all contracts altered. He had no doubt, therefore, that the relaxation, slight as it had been, must have had some effect in cheapening the paper currency of the country, and he thought the House could not be too cautious in any step that made the slightest approach to that state of things.
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On the whole, therefore, he thought things were in a very unsatisfactory position. The Government certainly had the precedent of the letter of 1847 to rely upon; but the state of vacillation and uncertainty in which the Government of that day were in before the issuing of that letter was most singular, and ought of itself to point out the necessity for devising a remedy for the present system. On the 20th of October, 1847, a deputation of Liverpool merchants waited upon the Chancellor of the Exchequer of the day—the present First Lord of the Admiralty (Sir C. Wood)—asking for a relaxation of the Act of 1844, but they were told by the right hon. Gentleman that such a relaxation was entirely uncalled for, and would not be sanctioned by the Government. And yet on the 25th of the same month—five days after—appeared the letter of the right hon. Gentleman and the noble Lord the Member for the City of London, authorising the Bank to break the law. Surely that was not a fair way of treating the productive interests of the country. It might be difficult to devise a remedy, but it was the duty of the Government and of Parliament to make the attempt, and the collecting together of all the events which had taken place during the last six weeks in the city of London would be of the greatest assistance in that endeavour.
MR. VANCEsaid, that as he represented the city that was the centre of banking operations in Ireland, and having had the honour of a seat on the Bank Committee of last Session, he was anxious to make a few observations on this subject. He believed it was as impossible for them to provide against alternate seasons of prosperity and adversity in commerce as it was in agriculture; but still it was their duty, if possible, to alleviate the distress by proper regulation of our banking and currency laws. The present crisis, he thought, bore a stronger resemblance to that of 1837 than to any other. He was engaged in business in 1837, as he was now, and he remembered that there was then a great temptation to certain capitalists to raise money upon bills drawn upon American houses here, and send it to America, where it produced a higher rate of interest than was given in England, and those bills swelling to an enormous proportion deranged the currency of the country. In 1837 a great

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American house came to the Bank requiring assistance in consequence of having made lavish advances upon American bills. On the present occasion another great American firm had to do the same thing, and that assistance was granted not on principle, but because of the tremendous consequences that a refusal would have involved. The crisis of 1825, he believed, was owing to the over-issue of notes. There was then no restriction, and every bank issued as many as it pleased. But as that was now prohibited by law, a crisis arising out of such a course was not likely to happen again. The crisis of 1847, again, was chiefly caused by the Irish famine, and the gold that was sent abroad to secure the purchase of food. On the present occasion he certainly thought the House did right in passing a Bill of Indemnity; and he would go further—he would have indemnified the Bank though they had paid away their last sovereign in order to save the country from the worst disaster that could have occurred—the impossibility of obtaining discount for fair and honest mercantile paper. If the last sovereign had been paid away, he believed the disaster would not have been so great as was generally imagined. The notes of the American banks that had stopped payment, with a fair prospect of resumption, were now only one per cent less in value than the silver dollar, and he believed the Bank paper would never have fallen to so low a discount as that. The only practical suggestion that had been thrown out on this question was by the hon. Member for North Warwickshire. He proposed that there should be a sort of double currency, one convertible, the other inconvertible. He (Mr. Vance) was afraid the effect of this would be that the one would always be at a large discount as compared with the other; it would be totally inapplicable for foreign purposes, and he thought the existence of the two would cause great confusion. He, in his turn, would throw out a suggestion—to which, however, he was not wedded—but which he thought deserved the consideration of the House. It might be thought to be a virtual repeal of the Act of 1844, but still it kept up the chief provisions of it. He would insist in the first place that the Bank should publish its accounts more in detail than they were at present—that, for instance, they should explain what the "other securities"
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meant, whether bills discounted or advances made. He would then place the relaxing power wholly in the hands of the Bank itself. It was stated by the Governor of the Bank in his evidence that whether Peel's Bill had been in existence or not, the conduct of the Bank in raising the rate of discount and checking the flow of gold out of the country would have been exactly the same as it had been. The chief object of his plan would be to remove that painful break in commercial operations between the time when the relaxation of the law was seen to be inevitable and its actual coming—that period when the difference of a day made a house solvent or insolvent. It now happened that firms which were in difficulties before the Act was suspended went down, while those that just managed to tide over the critical time carried their heads as high as ever, though they might not be a whit more solvent. He would allow the Bank to act upon its own responsibility—and a very serious responsibility it was—the responsibility of stopping payment if it did not secure its reserves. He was aware that the Bank did not want that power. One great reason why they wished to retain the present Act was, that they might avoid that responsibility, and that in case they should be brought to stop payment, they might be able to throw the blame on the Government, who had authorised the transgression of the limit. But they were entitled to no such protection, and he would lay it entirely upon them. He was surprised to hear one of the Irish Members, who was generally well informed, talking the other night of the Irish banks being allowed an unlimited issue of paper, and that it was only their good sense which prevented an over-issue. The fact was quite the reverse. By the Act of 1845, as it was applicable to Ireland, an average of the Irish issues was taken, and all the paper they issued beyond that average must be on a deposit of gold. That had answered perfectly well in Ireland, where he must say it was to the credit of the country that sent him there that there had been no over speculation; no bills in circulation without value received, on that side, but on the solid basis of cash payments or short credit. The same hon. Gentleman had suggested that the drawing of bills without value received should be made a penal offence. But such a law

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would prevent the Bank of Ireland drawing upon the Bank of England for £5000 unless it had funds to that amount standing to its credit in the Bank of England, and it would prevent bankers drawing on their correspondents under similar circumstances. He was surprised the good sense of the hon. Member did not show him the absurdity of such a proposition. Some dark hints had been thrown out respecting some changes that were contemplated in the Irish currency; and, among other things, it was said to be in contemplation to make the Bank of England notes a legal tender in Ireland. There was no necessity for such a step. He was fully aware of the inconvenience of having to bring over a quantity of sovereigns from the Bank of England to meet a run on the Irish banks; but the whole difficulty would be avoided by making the notes of the Bank of Ireland a legal tender in the hands of the other banks. It had been stated last night that it was quite impossible to get the circulation of the Bank down as far as £18,000,000; but seeing the rate at which the gold currency had increased—one-third in the last six years—and that it amounted now to at least £50,000,000, he thought it was quite possible to reduce the circulation within that limit. The right hon. Gentleman (Mr. Gladstone) had stated the other evening that the members of the Bank Committee had gone there to teach and not to learn. He had gone into the Bank Committee, not to teach but to learn. He had learnt in that Committee the necessity of the convertibility of paper; he had learnt that there would be great danger in changing the standard of value; and he had been convinced by what he had heard there that for many years past the Directors of the Bank of England had managed it with the greatest integrity and prudence, and with as much regard for the interest of the public as for the advantage of their proprietary.
MR. HUDSONsaid, his constituents were very grateful for the manner in which the Act of 1844 had been virtually repealed by the letter of the right hon. Gentleman. They had waited with considerable anxiety for that letter, for they knew it must come. He was not prepared to say that the letter was not too long delayed, he rather believed it was; he thought it ought to have been out in August last, and every morning for some
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time before it appeared he had looked anxiously for it in the newspapers. But no one voted more cordially for the indemnity than he did, though he felt, with the hon. Baronet the Member for Evesham, that it left the matter in a very unsatisfactory state. He was glad to say that the town which he represented had foreseen the storm, and had drawn in their sails, and the consequence was, that there was hardly any town in the country that had suffered less. But he now wished the House and the Government to propose some measure which would prevent those shameful recurrences of breaches of the law. In the course of his chequered life no man had dealt more with money than he had-—no man had had a greater command of it—no man had had more to do with it, and he had now the satisfaction of seeing that there was no enterprise on which he spent money that was not productive to the shareholders and beneficial to the public. In 1817 the crisis that then occurred was attributed to the railways; but he was on the Committee that sat in the following year, and he recollected then having a conversation with the late Sir Robert Peel on the subject; he attributed the crisis to the railways and asked him where the money that made the railways came from? He (Mr. Hudson) said, out of the pockets of industrious men, who, if they had not the railways to invest in, would, in all probability, have invested it in some foreign securities. But he said to him, "Where does it go? Does it not go into the pocket of the English' landowner, the English ironmaster, and other persons in this country?" And Sir Robert was obliged to admit that it did. He was not sure, however, but that the drain of the precious metals for the East Indian railways, together with the money sent abroad for the purchase of food for the people, would have produced the crisis. The Government had been blamed in some quarters for standing by the law. But what Government would have dared to stand still and let the people starve in order to carry out a theory? In 1847, before the Government letter was issued, a deputation of Liverpool merchants waited on the Government to ask for a relaxation of the Act; but the Chancellor of the Exchequer of the day, the present First Lord of the Admiralty, said he could give none. Some gentlemen

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from the north had waited on the right hon. Gentleman in the August previous to tell him that they foresaw that there would be a scarcity of money, and to ask the Government to take steps to meet such a crisis; but the right hon. Gentleman, with his usual pleasant way of putting off matters, only said to them, "Oh, there's plenty of discount to be got on good paper and good security." He himself (Mr. Hudson) on the Saturday before the issuing of the letter had occasion to pay some £60,000 or £70,000. He had £100,000 of Exchequer bills, and though he tried all the money dealers in the City to get an advance on them, he could not succeed. He was told that he must sell them, and that even then he must submit to a heavy loss. He then took them to the Chancellor of the Exchequer, and asked him whether his own Exchequer bills were not good securities, and yet it was impossible to raise money upon them. The right hon. Gentleman said there was plenty of money if the public would only pay it out. He (Mr. Hudson) admitted that; but then nobody would part with it. They buttoned up their breeches pockets. He believed the whole effect of the limit that was now placed upon the circulation had been to lock up in Lombard Street £8,000,000 of notes. As soon as the letter was issued the notes were brought out of the safe, and money was once more abundant. The noble Lord the Member for London charged all who differed from him with a desire to do away with the convertibility of the notes. He (Mr. Hudson) did not want to repeal the 'Act, but he wanted to give the power of relaxation to the Directors of the Bank of England, to be used at their own discretion, and leaving the responsibility with them. Look at the state of the deposits in the Bank of England. Did they suppose that there would have been £14,000,000 deposited there when money was at 10 per cent if the public had had confidence in the state of affairs? Two-thirds of it would have been out at discount, but a man said, "I know not how matters may go, and I want money, not for a week or a fortnight, but for months to come;" the chief anxiety of every man was to make himself secure with regard to his out-payments. No man of business pretended to be able to conduct his operations upon fixed and unalterable principles: new circumstances continually al-
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tered his position, and he acted according to the circumstances that arose. The public wished the Government to legislate on the subject, and were of opinion that the information before them was sufficient to enable them to do so. It was the duty of the Government to provide for an admitted evil, and to let the mercantile world know the position in which they were placed. When the Committee of 1848 was sitting public opinion at the time was that the operation of the Act of 1844 was not understood. The same alarm would, however, occur again so soon as the reserve decreased. It was not his business to suggest what alterations should be made. All that he knew was that public opinion almost unanimously condemned the Act. The Act might suit money-lenders; it might suit a nation of usurers, but not a nation of merchants. What absurdity to expect that a man should employ his money in ordinary commercial transactions if he could get 9 or 10 per cent by lending it. In fact, the system had been concocted as a means of raising the value of money, and hence it was injurious to, and depressive of, the trade of the country. The gentleman who had concocted it did not get his money under a system which curtailed credit; on the contrary, his career commenced when credit was extended to its utmost extent. If it were attempted to carry on the transactions of the country by means of the metallic reserve alone barter must be the result. He had thought a great deal upon the subject, and he would suggest that power should be given to the Bank of England to issue notes upon bills under discount to the extent of one-third their value,—for surely bankers' bills and the bills of first-class mercantile houses were worth 6s. 8d. in the pound. Whatever proposition was made, he wished to impress upon the Government that it would give the greatest dissatisfaction and cause the greatest disappointment if they were not prepared to deal with the question themselves instead of referring it to a Committee. A Committee might be very well upon other matters, but upon this the Government ought to be prepared to say either that they would abide by the Act and not have these shameful violations of it, or that they would alter the law so far as to secure an elasticity which should relieve pressure when alarm took possession of the public mind". There

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was great difference of opinion as to whether the letter came too soon or too late; but if the letter had not come and the banks had not behaved in his district in the most liberal and kind manner, thousands upon thousands would have been out of work, and the most fearful consequences would have resulted. It was impossible to maintain the Act in its entirety, and he hoped Her Majesty's Government would prepare a Bill during the approaching Christmas recess to get rid of that obnoxious and injurious part of it which limited the issue of notes under all circumstances to the amount of bullion in the Bank.
MR. J. H. PHILIPSapproved of the proposal to grant an indemnity, for he did not think that the Government could have acted otherwise than they had done. As to the cause of the recent embarrassments, he could not think that the currency had anything to do with them, because the same state of things had occurred in America, where there was virtually a paper currency; in Hamburg, where the currency was virtually metallic; and in this country, where the currency was a mixed one of paper and gold. He believed that the cause was a natural one, and was one over which the Government had little or no control—namely, an excess of improper speculation. Of late years a great change had taken place in the public mind as to the subject of banks. Formerly if the banker kept his customer's money and honoured his cheques, he was entitled to the profits of the balance in his hands; but of late depositors looked to receive large interest from their bankers. He knew of persons not properly connected with commerce who had received as much as 9 or 10 per cent interest on money at call in their bankers' hands. He could never believe that bill-brokers or bankers could pay such interest on money without discounting bills of a dangerous nature. It might be said that the practice of allowing interest brought money into commerce which would otherwise be hoarded. He admitted that hoarding or keeping money perfectly inactive was not desirable, and that activity was preferable; but there was a difference between activity within the bounds of prudence, and a feverish activity leading to spasmodic convulsions, and ending in perfect exhaustion. There was no cure, which he could see, for the latter state of things, except the logical one of letting every one suffer
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for his own imprudence. But when such a crisis as the present arose, so widespread was the evil that the Government had felt unequal to resist the pressure put upon them to interfere. He was afraid that the same thing would continue to go on in a vicious circle; that individuals would go on in their career of speculative transactions in the hope that the Government would again step in to relieve them; and that in the long run neither the Government nor the Bank would be able to come forward to their relief. But, as a corrective, he hoped the conviction would become more widely diffused among the community of the truth of the principle which was never more tersely expressed than by the late Duke of Wellington, "that high interest means bad security."
MR. BAGWELLthought, that any interference with the banking system of Ireland would be fraught with great mischief and produce great uneasiness. The circulation of Ireland was very little more than £6,500,000. In the south and west a sovereign was very rare, and the people scarcely knew what it was. The issue of the Bank of Ireland was £'3,509,850; the issue of the Provincial and National Banks of Ireland, which afforded the almost entire circulation of the south and west, was £"2,109,085. Any interference with the Provincial or National Bank by restricting the issue of their notes or the issue of £1 notes, would have a very bad effect upon the agricultural transactions of the country. There were three or four joint-stock banks in the north of Ireland, issuing their own notes, and their circulation amounted to about the same as either of the southern banks. Irishmen were not often content with their lot, but in this particular they were. They looked upon banking as a banking system, and not as a jobbing system. They were satisfied with getting 3 per cent on deposits for three months; and if they wanted to speculate they had only to draw out that money and bring it over to England, where they could get 8 per cent. He thought, however, that the giving 8 per cent on money which was only left for a month showed, not bonâ fide banking, but jobbing. He desired to restrict any propensity for jobbing, but not to restrict legitimate trade, which was the lifeblood of a country. Whatever arrangements were made by the Government, he hoped that, as the Irish were content, they

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would be left alone with their joint-stock banks and their £1 notes, and that they would not be forced to circulate only Bank of England or Bank of Ireland paper. The Tipperary Bank was carried on by means of Bank of Ireland paper; if they had issued their own paper they never could have perpetrated one of the most gigantic swindles ever known, he cause no man in Ireland would have trusted them without the Bank of Ireland paper. He hoped that under the circumstances the Government would not interfere with the Irish banks.
MR. KIRK, in reply to some observations from Mr. Vance, explained that what he had said on a former occasion was, that, there had been no over-issue in Ireland, and with regard to fraudulent bills of exchange, that he had no intention of including in the description of bills of exchange drafts of the Bank of Ireland on the Bank of England, which he considered more as bank orders or bank post bills.
MR. ADAMSthought there was a defect in the Chancellor of the Exchequer's statement, inasmuch as it contained no indication of the nature of the pressure put upon the Government to induce them to relax the Act of 1844. He concurred in all the expressions of thanks which had been tendered to the Government for the relaxation, but he deemed it a question whether the relaxation should not have taken place at an earlier period. All he wished to know from the right hon. Gentleman was some general indication of the nature of the representations made to him to induce him to make the relaxation. He did not agree with the hon. Member for Eve-sham (Sir H. Willoughby), who recommended the appointment of a Committee to inquire into the present crisis, because until transactions now current were matter of history, it would be unsafe and unfair to make inquiries into the position of firms of high standing, which might entail serious consequences. They were all agreed that if the Act of 1844 were to be maintained there must be a relaxing power somewhere, and that unless there was some such safety valve the chances were the whole machine would burst. It was therefore highly necessary to ascertain the nature of the pressure and the representations which were made to induce the Government to issue the letter at a particular time. He had the highest possible respect for the members
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of the existing Government, but, with the vague feeling which prevailed out of doors against anything like irresponsible power or improper and indirect influences, he hoped the Government would give a distinct and positive assurance, not indicating the persons from whom they received it, but that they did receive strong representations from many persons to induce them to advise the Bank to violate the Act. An impression prevailed that the representations to the Government came only from a few, and were based upon entire misrepresentation. It was said to have been plainly and broadly stated to the Government to induce them to do what they did, that the Bank had refused to make any further advances. The rumour had been repeated with so much circumstantiality that he hoped the Chancellor of the Exchequer would give a general contradiction to it.
THE CHANCELLOR OF THE EXCHEQUER: I am sorry to have to trouble the House again upon this question, but I think it would be disrespectful to the hon. Gentleman who has just sat down if I did not answer the question which he has put to me in so pointed a manner. If the hon. Member had been in his place on the night when I made a previous statement, he would have heard that which does, in fact, answer, by anticipation, the question; because I then stated in the most distinct manner that it was not in consequence of any representation addressed to the Government by the Bank Directors, or of any pressure applied to them by deputations, or of any representations by mercantile houses, that the Government were induced to issue their letter. What I stated was that the Government acted exclusively upon their own view of the facts, and upon their own responsibility, knowing that if they advised an infringement of the law it would be their duty to ask for an indemnity. The grounds upon which, as I have previously stated, the Government acted were these:—We looked at the authentic accounts of the Bank of England, and we obtained from the Governors of that Bank a statement, day by day, of their financial position. Upon those facts and our own anticipation of what would be the consequences if we did not address such a letter to the Bank we decided; and I state again, as I stated before, that no pressure whatever was placed upon the Government which they

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could not with the utmost facility have resisted. I do not rest the decision of the Government in the smallest degree upon the impossibility of our having acted otherwise. I state distinctly that if we had chosen to withhold that letter, and if we had thought there was not such urgency in the position of the Bank as rendered it expedient and even more than expedient that the letter should he issued, it would have been as easy to have withheld the letter as to have issued it. I do not know that I can add anything to that language to explain to the House that it was not in consequence of any representations of individuals that we came to that conclusion; hut lest it should be thought that my answer is any way defective, I will state to the hon. Gentleman and to the House that, as far as I can recollect, no person complained to me that the Bank had refused discounts. It was represented that there was great difficulty in obtaining discounts otherwise than through the Bank. It was represented that discounts had virtually ceased in London except at the Bank. But I did not hear, either from the Bank Directors or any individual, a complaint that the Bank had refused discounts. Of course, it must he conceived that the Bank could not discount indiscriminately, and, although I have no detailed knowledge of the operations of the Bank, I conclude that they will at a time of crisis, as at any other, exercise discretion in the choice of bills they will discount. I can only repeat that I have no recollection of having heard from any individual any complaint of withholding of discount by the Bank, and that I do not rest the case of Government interference upon anything else than the state of the Bank as exhibited in the papers now before the House. If you refer to the state of the Bank reserve you will see the notes were £958,000 on the 11th of November, and on the 12th £131,000. The letter issued from the Treasury was not signed until after three o'clock on the day of the 12th, and could not have reached the City time enough to influence the operations of the Bank on that day. I leave it to the House to judge whether that was not a state of things which at any rate would create some apprehension on the part of the Government, which must be considered as exercising at such times great responsibility. Be-
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fore I sit down I may perhaps be allowed to refer, though it is not a matter of any great importance, to a statement made by the right hon. Gentleman the Member for Oxfordshire (Mr. Henley). I am sorry to have to make the correction in his absence, as he is a very fair and accurate critic. He said he thought the Government might have been accelerated in their movements by the knowledge that certain deputations were coming from Liverpool; that although they were not formally announced, there were indirect means of knowing; that coming events sometimes cast their shadows before, and that very likely the Government were stimulated by the knowledge of these coming deputations. I can only say I have no recollection of having heard of any intention of sending such deputations to London, and I do not think my noble Friend at the head of the Government received any such intimation. Certainly he did not communicate any such intimation to me; and I can most sincerely state to the House that I am quite confident the Government were not in the smallest degree influenced in coming to a decision by the anticipation of deputations from Liverpool or elsewhere.
Question put, and agreed to.
Bill read 3°.
Upon Question that the Bill do pass,
THE CHANCELLOR OF THE EXCHEQUERsaid, that he had to move a verbal amendment in the first clause in consequence of an objection taken to it by his right hon. Friend the Member for the University of Oxford. The words of the first clause were intended to be so comprehensive as to prevent any technical legal objection to the bank issues, seeing that a certain number of notes had been issued in violation of the law which could not be distinguished from the great body of issues. It was important that the words should be sufficiently comprehensive; but his right hon. Friend, jealous of the Bank, thought that the Directors might be indemnified without making the words so wide. He would therefore propose to insert, instead of the words "all acts done by them in relation to such issues," the words "all acts necessary to the making of such issues."
Verbal Amendments made, and Bill passed.
House adjourned at Three o'clock.