SUPPLY—FINANCE—QUESTIONS. (Hansard, 9 December 1857)

§ SIR HENRY WILLOUGHBY
said, he wished to take that opportunity of putting a question or two to the Chan- 425 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. HUDSON
said, 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- 426 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 427 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 428 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- 429 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, 430 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. WILLIAMS
asked, 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 431 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.