§ MR. AKROYDsaid, he would beg to ask Mr. Chancellor of the Exchequer, Whether his attention has been called to the difference in the rate of interest at present charged by the Bank of France, now 4 per cent, and that charged by the Bank of England, now 10 per cent, and to the prejudicial effect which this difference of no less than 6 per cent in the value of money has upon British mercantile and manufacturing enterprize, both in the Home and Foreign markets; whether he is aware that, by an Imperial Decree passed in January, 1865, an inquiry was instituted into the operations of the Bank of France, more especially as to "the causes which at frequent intervals, and at almost periodical epochs, have brought about the rise in the rate of interest;" and whether, seeing that the variations in the rate of interest have been more frequent and more extreme on the part of the Bank of England than on that of the Bank of France, he is prepared to institute a similar inquiry into the operations of the Bank of England, and into the causes of the excessive fluctuations in the Bank rate of discount, as also into the effect thereby produced on the trade and industry of this country; and furthermore to extend the 1440 inquiry into the cause and effect of the present monetary panic?
THE CHANCELLOR OF THE EXCHEQUERSir, the question which has been put by the Member for Halifax is one of very great importance, and divides itself into three branches. The first has relation to the difference in the rate of interest at present charged by the Bank of France and that charged by the Bank of England —the one 4 per cent and the other 10 per cent. The second has relation to the inquiry instituted not very long ago in France, into the operations of the Bank of France, and the causes which led to a rise in the rate of interest; and the third is, whether we are prepared to institute a similar inquiry into the operations of the Bank of England. As regards the first of these points, I am cognizant, as the world is cognizant, of the difference in the rate of interest charged by the Bank of France and that charged by the Bank of England; and we might go further, and observe the condition of other banks in Europe, one of which, the National Bank of Prussia, charges at the present moment very nearly the same rate as the Bank of England. I am aware that an inquiry was instituted some time ago into the working of the system of currency in France; but I am not aware whether the object of that inquiry has yet been completely attained. But as regards the principal part of the question of my hon. Friend, whether we are prepared to institute an inquiry into the operations of the Bank of England, and the causes of the excessive fluctuations in the Bank rate of discount, I would simply say these two things. I think there are some obvious reasons why the rate of discount must be expected to fluctuate in this country in a greater degree and with greater frequency than in other countries, as, for example, in France. In England we transact a far greater mass of business, with a much greater equality of our currency, than they do in other countries, and therefore we have a much smaller reserve. The holders of money in England likewise turn their money to account much more uniformly than is done in other countries. I do not say that these are reasons why from time to time the working of our monetary system should not be made the subject of inquiry; but in reference to the circumstances of the present time we are still in a position more or less analagous to that which prevailed two or three weeks ago when the Bank Charter Act was sus- 1441 pended. Therefore, until we have more completely emerged from those circumstances it would not be desirable to enter upon the consideration of the question whether, or when, another should be added to the various inquiries which have taken place at different times in reference to the condition of our currency. Limiting my answer to the present time, I say that it would be inconvenient just now to institute any such inquiry.