HC Deb 23 February 1875 vol 222 cc772-87
SIR HENRY JAMES

rose to move that a Select Committee be appointed— To inquire into the circumstances attending the making of Contracts for Loans with certain Foreign States, and also the causes which have led to the non-paymant of the principal moneys and interest due in respect of such Loans. The hon. and learned Member said: I can assure the House that I am sensible of the responsible nature of the task I have undertaken in submitting the Motion with which I shall conclude my observations. I am sensible of that responsibility, especially, because I feel that in the course of the statement I am about to make to the House, I shall, of necessity, be making charges against certain persons resident in this country; but, for my own part, I shall content myself with making a simple, and, I trust, a brief statement of certain facts which I think sufficient to justify the inquiry I am seeking for. If those inquiries subsequently prove the existence of those facts, the facts themselves must be answerable for the charge, and not the person who introduces the Motion. Perhaps it may be in the knowledge of many hon. Members that at this moment the amount of foreign debt in relation to which there is default amounts to the large sum of £240,000,000. The extent to which that stock is held by creditors in this country I am unable to state to the House; but without doubt a portion of that sum of £240,000,000 is very largely held by English creditors. In relation to many of the countries that are in default, I do not seek to apply this Motion. In those cases the circumstances under which the loans have been raised have all been known to, and probably investigated by, the Government of this country in past times. I am not seeking to re-open those questions. I am not asking Her Majesty's Government to interfere on behalf of the English creditors against all those States that have made default. It is a burden which, according to the habits of Governments, I do not say they ought to bear; but I am endeavouring to deal with, and if possible to destroy, a system that has sprung up comparatively of late years, of bankrupt States, knowing themselves to be in a state of complete bankruptcy, recklessly coining into this English market and endeavouring to obtain from English creditors money which it is clear that those States can never repay. I am anxious also to deal with the system under which the agents of those States, according to the statements of their own Governments, have appropriated and retained that money on its way from English creditors to the State for which it has been borrowed, in order, if possible, to destroy that system. I think I can show there is no remedy existing now, without inquiry, and I am asking this House to and in achieving a good end by allowing this inquiry to take place. The States to which I wish to call attention now—not that they form the whole of the States that have made default, but which I wish to place before the House rather as examples than as including the entire case—are Honduras, Costa Rica, San Domingo, and Paraguay. My statement as to Honduras is very simple, and the House will pardon me if I think it necessary to occupy its time in briefly glancing at the condition of that State, and the circumstances under which these loans have been obtained in this country, and the way in which they have been applied by the persons who, without doubt, received the money. As far as we know—and our knowledge of the place is very limited—Honduras is a State that contains some 250,000 inhabitants. A great proportion of these are aborigines, so scattered through the country that no Census can be taken, and certainly they do not form a population capable of bearing much taxation. Their revenue, so far as it can be traced, has never exceeded £100,000 annually, and out of that £100,000 all the expenses of their internal administration, of their Army and diplomatic officials, have to come. What little further is known of Honduras does not tend to show that its resources are very great; because in 1839, when the debt of the Federate States was divided into 12 parts, it had to bear 2–12ths of that amount, the sum it had to pay being £27,000, bearing interest at 10 per cent till 1867. Honduras was in such a state of insolvency it never was able to pay that amount; and the arrears amounting to £92,000, it had to do what many an insolvent person has had to do—namely, to compound with its creditors. It admitted its insolvency in May, 1867, and asked its creditors, in lieu of the £92,000, to accept £50,000 in bonds, bearing a lower rate of interest. I assume that Honduras was unable to pay its debts; and, that being its not unnatural condition—looking at its revenue in May, 1867—it commenced a new life as early as November, 1867. In that month the Minister of Honduras, a gentleman whose name must be mentioned, Senor Gutierrez, the accredited Minister to this country, introduced a loan of £1,000,000, and it was issued at such a price that the loan produced the sum of £800,000, bearing interest at the rate of 10 per cent. Senor Gutierrez issued his own prospectus, and, as Minister of Honduras, he asked the English capitalists to invest money by way of loan to his Government, and he made certain distinct statements as to the application of the loan. It was to be applied to the construction of the first section of a railway—the first section to be 56 miles in length. He said a contract had been entered into for making it for £18,000 per mile, and that it would be amply sufficient if that section were completed, to provide for the future completion of the remaining sections by the hypothecation of the domains and forests of Honduras, the forests being applied first to the repayment of that loan to the English creditors, and then for the further construction of the railway. Having obtained that money in November, 1867, in February, 1869, Senor Gutierrez appears again on the scene. It is now in conjunction with his colleague in Paris, Mr. Herran. There they introduce into Paris, and later into the English market, a loan for £2,490,000, producing in actual monies a sum of £2,000,000. The prospectus announces that that loan "is the first mortgage of the domains and forests of Honduras," which had been already mortgaged when the loan of 1867 was made. That prospectus states that "the produce of the present loan will be applied in its integrity "to the completion of the Interoceanic line of railway. We now find that Honduras has obtained £2,800,000 to complete the railway. Having obtained it in June, 1870, Senor Gutierrez's plans appear to have enlarged as time proceeded. Well, he applies in the London Market for this £2,500,000, and he obtains £2,000,000, in order to complete the same railway. There is no mention of the previous loan having been obtained. The Minister in his prospectus speaks of this loan instead of a previous loan; and he also' states this—" That the contractors are under heavy contract to complete this railway." What is the sum of money, therefore, obtained? The sum of £4,800,000 was obtained to complete this railway. But the ambition of Senor Gutierrez did not remain there. Having obtained from the English people the comparatively small sum of £4,800,000 to complete this railway, the representative of the Honduras Government appeared again on the scene in May, 1872. His plans increased, as I said before, as time progressed, and he now demands a loan of £15,000,000, or an actual sum of £12,000,000, from the English people to complete the same railway. But I must do this gentleman justice. It was not an ordinary railway that was said to be about to be constructed. It was suggested, in the first prospectus, that there was a necessity for this railway to provide for the carrying of British enterprise and British goods across Honduras. The prospectus states that 16,000,000 of British tonnage yearly passed Cape Horn, which ought not to have gone that dangerous voyage. So far as I have been able to ascertain, 1,700,000 tons only passed Cape Horn; but a statement of that tonnage only would not have justified probably the expenditure of so large a sum of money. But, as I said—this was no ordinary railway that the gentleman suggested should be constructed. He said that every ship that sailed from England and passed Cape Horn should call at the Eastern shores of Honduras; and, up to 1,200 tons of burden, I think, fully manned and equipped with stores and cargo on board—it should be placed on a railway truck and carried by the railway truck over the table land of Honduras, and dropped in the same character and in the same manner on the Western Sea that washes the shores of that country. If anyone would like to relieve himself of monotony, I hold in my hand the original prospectus—in which Senor Gutierrez depicts the ships passing over the table land, and being carried in that way to the eastern or western coast. The English public did awake to the real condition of things, and a representative body made a demonstration against this demand, and pointed out to the English creditors—who had been credulous enough hitherto—that this proposal was an impossibility; and on the 17th of May the Minister announced that he thought it consistent "with the views and motives of my Government to withdraw the same "—that is, this last scheme—" and to await a more favourable opportunity." I am anxious, if I can, to prevent that more favourable opporfunity from occurring. Probably the House would wish to know that we have not learned what has become of this sum of £4,800,000. Allow me first to point out to the House that if this scheme had been successful, the indebtedness of Honduras would have amounted to the sum of £21,000,000, and that in the case of a country hopelessly insolvent—so insolvent that it could not pay £27,000 with a revenue of £100,000 a-year, while the annual sum for interest and sinking fund would have approximated to £3,000,000, which, of course, never would have been paid. One looks round to see what was the object of all this, and to whom and for what purpose has this money been applied. The statement was clear and distinct when it was announced originally that the money was to be applied to the construction of the railway, that the forests of Honduras were mortgaged, so that the creditors should receive the results of those forests. I will tell the House that whilst £4,800,000 has been paid to the financial agents of Honduras through Messrs. Bischoffsheim and Goldschmidt, or to the financial agents in this country, so far as can be discovered out of that £4,800,000, only £562,000 has been applied to the construction of the railway. The rest is lost sight of. The railway remains. It is in existence, but it is abandoned—it is perfectly useless; and as to the forests, so far as is known, not one piece of timber from the Honduras forests has ever come to this country. If any has, the financial agents do not know about it. The result is that of that £4,800,000 all that the English creditor can obtain by way of answer is that there is a certain tin box in the Bank of England. It is stated there was a sort of general bond that was to give full security to all the English creditors. I hold in my hand a correspondence between a gentleman at Glasgow and the Bank of England. The gentleman applied to the Bank of England to know what was the security, and the answer he obtained from the representative of the Bank of England was this— In reply to your letter of yesterday, I beg to state that the box, said to contain the general bond of the Honduras Loan, has been deposited with the Bank of England; but as the Bank are only the custodians of a locked box, with the contents of which they are not acquainted, I am unable to give you any further information on the subject. Senor Gutierrez keeps the key, and what is in that box no one has been able to discover. And that is all that remains, for there is a repudiation of Honduras to pay this sum of money. All that remains is, then, this locked box. A gentleman who has sent me that information tells me of another box. He says— Many hundreds and hundreds of letters he in the tin box hero (Glasgow) from people ill able to afford the frightful losses sustained. All of the same tenour. Naval and military men obliged to leave the service to find other employment to maintain their families, widows reduced to absolute destitution, aged men unable to work, find a life's savings swept away, find themselves with worthless bonds, and all characterise this Honduras fraud with one form of expression. What I believe is this—that all that remains, and all that the creditors are likely to obtain, is the expression of their judgment on the fraud, for they can never obtain any compensation from the State. I do not stop now to endeavour to show to this House that those who have received that money should give it up. Everything I have stated I have proof of under my hand. The prospectus is now on this Table. I pass quickly on to the statement in relation to the loan of Costa Rica; and the reason why I mention this next is, that it is a singular fact that, although not making himself very conspicuous in the country, the same gentleman, Senor Gutierrez, is responsible for this. He was appointed to this country as Representative for Costa Rica in November, 1870, and soon after that, or early in 1871, he dealt with Costa Rica as he had done with Honduras, and introduced a loan of £1,000,000, for which he received £720,500. Immediately afterwards—that is to say in the following year, 1872—he introduced a loan for £2,000,000, or rather the State of Costa Rica authorized it, and a sum of £1,200,000 was obtained; so that the State has obtained altogether the sum of £2,000,000. All the amount that we can find to have been sent to Costa Rica of that sum is £926,000; the rest has been detained from going there. One statement is made in the prospectus of this loan which of course is interesting to every one. It is that the Representative of the British Government is the person in whom certain Customs duties have been vested, and that he will forward the proceeds of those duties to this country. I will assume that the Representative of the British Government has received those duties; but whether he was over authorized to do so, I do not know. A clergyman writing to me from the North of Ireland, sends me a copy of the statement made to him by the financial agents of this loan, Messrs. Bischoffsheim and Goldschmidt, who say they know nothing of the Representative of the British Government being authorised to receive these duties. They say, writing on the 16th July, 1874— We beg to inform you that the statement put forward in the advertisement of the second issue of the Costa Rica 6 per cent Loan, to which you take exception, was made upon the autho- rity of Don Carlos Gutierrez, the Minister for the State of Costa Rica in this country, who vouched for the truth of it by signing the prospectus, and as we received the remittances through Mr. Corbett, we had every reason to believe it was true. The remittances have ceased from Honduras, and not a sixpence has been received on cither of the Costa Rica loans. The next loan—the San Domingo Loan—is a comparatively small matter; yet the gentleman who took charge of the loan is one whose enterprising character is worthy of note, if not of commendation, for although the loan is small, he took the whole of it, or very nearly. It was introduced in 1869 for £757,000, and at the price of issue the enterprising contractor obtained the sum of £529,000. I have had an opportunity of reading the shorthand writer's note of that gentleman's account of the affair in the trial in which he appeared; and the result of his statement is, that the San Domingo Government only received £50,000, and that was sent back again. There is some doubt whether they have not recovered £37,000, which I will assume they did. At any rate, they had no more of the £529,000 than the sum of £37,000; and the contractor puts such a value on his own services, that he has a heavy claim on the San Domingo Government for having introduced the loan to England. His name, like so many others of his class, is not an English one; it is Hertzby Hartmont. I have to deal with only one State more. The next is that of Paraguay, the revenue of which is put clown at £110,000. In 1871, a loan was introduced nominally for £1,000,000, and the amount actually raised was £800,000. All these loans follow the same course. As soon as the money is obtained, which seems so easy to get, in the year 1872 another loan, which produced in actual money £1,640,000, was subscribed by the English public, making the total approximate amount £2,500,000. The prospectus introducing the loan stated that it was the first public debt of Paraguay, and that Paraguay had no funded debt. I will not answer for the truth of the statement, but that book to which we are all in the habit of referring, The Statesman's Year Book, alleges that the debt of Paraguay amounted at that time, in consequence of the war, to £47,200,000, and I have seen no contradiction of that statement on the part of the gentleman who introduced the prospectus. But, whatever the truth as to the indebtedness of Paraguay at that time, the material point for consideration is—what has become of the money which the British public subscribed? I hold in my hand a communication from the gentlemen who now represent the Government of Paraguay in this country. They say—" In order that you may form an exact idea of the troubles of the Government after receiving the said advice, we will only tell you that of the loan of 1872 "—which amounted to £2,000,000 nominally—"we have onlyreceived£239,687." The effect of that on Paraguay is stated to be that not only has Paraguay not received the money contracted for, which was all subscribed, thus losing the benefits she was entitled to look for, but for the want of that money the principal sources of the wealth of the country have had to suffer; it has sustained losses in respect to its agricultural development, railway works have had to be suspended, public buildings have sustained serious damage for want of repair, and the Government have had to pay, and are still paying, increased interest for the obligations contracted on the receipt of the advice that all the loan had been subscribed. ["Name."] There is some difficulty in ascertaining who is the contractor, and that I may not do an injustice to anyone, I had better not mention any names. I have now mentioned all the instances I think it necessary to give to justify the necessity of this inquiry. I have been asked—what is it you intend to do when this inquiry has taken place? I tell the House very frankly that I really do not know what ought to be done, or what is the proper remedy of an evil, until we have traced that evil to its source, and ascertained what it is against which we have to contend. But, at any rate, we should obtain exposure. We shall obtain the exposure which will give warning to the unwary, and prevent the repetition of such offences by men placing their views before the public in the way they have done in the past. There are many aspects of this evil against which we may have to apply this remedy, if I am right in what I said a few minutes since. I am not pressing on the Government the obligation that they, representing the State, should always fight the battle of the English private creditor. But there is this condition of things—that if a State, knowing it is impossible to pay a debt, that it is in a bankrupt condition, comes into this country and takes away money from the people of this country, it is obtaining money by way of false pretences. And I believe it is a question worth consideration by those who take care of the interest and honour of this State, whether some action ought not then to be taken by the Government to prevent such proceedings by foreign States against our people. May I detain the House a few minutes longer by reading the views of Lord Palmerston as to the intervention of the State on behalf of a private creditor against a foreign State which did not pay what was due from it? It was on a Motion brought by Lord George Bentinck, in June, 1847, when he endeavoured to impress on the then Government the necessity of on-forcing the claims of the English bondholder against Spain. Lord Palmerston said it was always a question of expediency whether a State should interfere or not on behalf of a creditor. He admitted that it was, under certain circumstances, an obligation to interfere, and he concludes thus— Although I entreat the House, upon grounds of public policy, not to impose at present upon Her Majesty's Government the obligations which the proposed Address would throw upon them, yet I would take this opportunity of warning foreign Governments who are the debtors to British subjects, that the time may come when this House will no longer sit patient under the wrongs and injustice inflicted upon the subjects of this country. I would warn them that the time may come when the British nation will not see with tranquillity the sum of £150,000,000 due to British subjects, and the interest, not paid. And I would warn them that if they do not make proper efforts adequately to fulfil their engagements, the Government of this country, whatever men may be in office, may be compelled by the force of public opinion, and by the votes of Parliament, to depart from that which hitherto has been the established practice of England, and to insist upon the payment of debts due to British subjects. That we have the means of enforcing the rights of British subjects, I am not prepared to dispute. It is not because we are afraid of these States, or all of them put together, that we have refrained from taking the steps which my noble Friend would urge. England, I trust, will always have the means of obtaining justice for its subjects from any country upon the face of the earth. But this is a question of expediency, and not a question of power; therefore let no foreign country who has done wrong to British subjects deceive itself by a false impression either that the British nation or the British Parliament will for over remain patient under the wrong; or that, if called upon to enforce the rights of the. people of England, the Government of England will not have ample power and means at its command to obtain justice for them."—[3 Hansard, xciii. 1305.] But there is another view—if it should turn out that the States have not authorized the loans, that the agents have not remitted the money, that they have not fulfilled the obligations they gave personally, then am I to ask the House, is there no remedy against them for such proceedings? At present we have no means of proceeding against the Representatives of foreign States. They are free from process, and free from any proceeding in our Courts, and we now see how some of the Representatives of these States, entering into semi-contracts, after making these statements, are able to set everything at defiance. There is only one other statement I wish to make. I have heard some objection made to this inquiry. It is said, in the first place, Why should not people look after themselves? Why, if they are credulous, should you seek to protect them? Well, why should we not protect the credulous as well as any other person who is the victim of fraud and deceit? However foolish he may be, why should he not be protected? I cannot understand the argument that can be used by those who are the friends and partizans of some of those who have introduced these loans, when they say that there ought to be no protection against these false statements. It is also said that litigation is pending. It is litigation, however, of which I only know by rumour and report, and I protest against this House being relieved from the duty of inquiry, because one individual bondholder is trying to obtain £1,000 of his own money, not against the particular State, but against some individual contractor, against whom he may or may not succeed. The litigation may go on for 10 or 15 years, and all prove futile, and in its result will probably be so. I can only say that, if this Committee be granted, and if there be shown that there is any injustice to any individual, then will be the time to ascertain how far the inquiry should be pushed. One word more in support of this Motion. Is it not just to these gentlemen who have issued these prospectuses and received this money that this inquiry should take place? These statements have been mentioned and referred to in the public prints, and with very great distinctness to-night; surely, therefore, these gentlemen will not wish that no inquiry should take place. Will they not rather be ready to afford every explanation? Whatever may be the view of this House, I have brought this Motion forward, accepting a labour which is not a pleasant one to me, and taking some little trouble about the matter, in the hope that restitution may be indirectly obtained for those whom I deem to have in some instances been the subjects of fraud, and that we may also protest against a continuation of this system, and rid from our midst men who are careless alike of our national name and everything save and except that of putting money into their own pockets. The hon. and learned Gentleman concluded by moving for the appointment of the Committee.

MR. CHARLES LEWIS

said, the question raised was one worthy of the consideration of Parliament and of the country. There could be no doubt that the system complained of by the hon. and learned Member was surrounded by very great scandals, and had produced great distress among the class of persons who were in the habit of investing small sums of money. This arose mainly from two causes. In the first place, the investing public evinced a reckless determination to act upon prospectuses which offered high rates of interest; and, in the second, they became infected with the gambling spirit engendered by the system of annual drawings, under which, if lucky, persons who had invested, say, £75 in the purchase of a £100 foreign bond, might—if the borrowing State happened to be solvent—obtain payment of the £100 in addition to a high rate of interest after the lapse of a very few years. He did not want the House to forget the principle of caveat emptor, but he hoped some protection would be extended to those who were misled and helpless. The House might deal with the matter by having a system of registration in order to let the creditors know with whom they were dealing, and how far the debentures were proper and legitimate instruments to bind those Governments to the performance of their obligations. He hoped some system of registration would be enforced, and that it would be made illegal for persons to advertise without complying with certain regulations, the issue of foreign loans, and this would enable persons to trace out those with whom they were dealing. No one could accuse the hon. and learned Gentleman of any exaggeration; but he (Mr. C. Lewis) knew from good authority that the hon. and learned Gentleman had been misled as to Paraguay. The issue of loans for that State had been £2,000,000 or £3,000,000; but the amount really due to the public was only £1,000,000. He (Mr. C. Lewis) had ascertained this fact in the course of a judicial investigation. He believed that that loan was only nominally issued by the promoters. He agreed entirely with the principle of the speech of the hon. and learned Gentleman; and, in the main, with the Motion.

THE CHANCELLOR OF THE EXCHEQUER

said, it was evident from the way in which the speech of the hon. and learned Gentleman (Sir Henry James) had been received, that the House sympathised with his expressions of indignation at the stories he had felt it his duty to bring before the House. Everybody must feel at the same time that however much they might be disposed to smile on one occasion and be angry on another at the simplicity of those who fall into these traps, yet it was melancholy to think that the principal sufferers upon whom the blow fell with the greatest severity were those people who were least able to protect themselves. Nobody could wonder that the hon. and learned Gentleman, having had his attention called to this subject, should have called the attention of the House to it. But they had to consider what was the proposition that he made to them. He asked that they should appoint a Select Committee of the House for the purpose of investigating these complaints and of endeavouring to discover some remedy for the evils which existed. He told them very frankly that he was not able himself to suggest a remedy; but that he believed the investigation which might be made before a Committee would lead to the discovery of one. Well, it was a matter for consideration how far it was desirable to appoint a Committee without any very clear and definite ideas of the line which they were to take and of the issue at which they were to arrive. The House, therefore, ought to consider carefully what they were about when they agreed, if they did agree, to the Motion of the hon. and learned Gentleman. There were one or two considerations they must bear in mind. In the first place, they had to consider how any proceedings they might take might affect our relations with foreign Governments. That, of course, was a serious question, but it was one which the Government had considered, and which had been brought specially tinder the notice of his noble Friend (Lord Derby) since Notice had been given by the hon. and learned Gentleman. He (the Chancellor of the Exchequer) was in a position to state that Lord Derby, after carefully considering the question, was of opinion that there was nothing in the proposal of the hon. and learned Gentleman that need in any way produce difficulties between us and foreign States. If the Government had felt that it might embarrass our foreign relations they would have felt it their duty to state so to the House, and they might have been inclined to resist the Motion of the hon. and learned Gentleman; but he desired to say, on behalf of the Government and of his noble Friend, that he was prepared, so far as the Foreign Office was concerned, to waive any objection that might be suggested of a possible complication with foreign Governments, merely stipulating that clue caution should be taken in any inquiry the House might make properly to observe all the courtesies and privileges of foreign Representatives. Well, then, there was another question which arose out of the proposal, which was this—Everybody must feel that when any story of fraud, and of suffering which resulted from fraud was brought before anybody of Englishmen, there was a natural desire to come forward and see whether they could not obtain some redress or devise some mode of punishing that fraud. But the House must always be careful to consider whether the particular body to whom the appeal was made was precisely the body whose business it was to come forward in the matter. And they must bear in mind that there were many tales of wrong—moving tales of wrong—that might be brought before Parliament which it did not belong properly to the functions of Parliament to deal with. They must take care that they did not interfere in any way with the proceedings of the Courts of Law; that they did not arrogate to themselves duties which more properly belonged to the legal tribunals of the country. They must not turn a Committee of the House into anything of the nature of a Star Chamber. They must bear in mind that Committees of the House in conducting inquiries had not usually the same advantages for the investigation of questions of a judicial character as were possessed by the ordinary Courts of Law, whose business it was. He thought the House, whatever sympathy or indignation they might feel, should be very cautious indeed how they undertook a duty which might be discharged by an ordinary tribunal. Nevertheless, he was bound to say, speaking on behalf of the Government, that after listening to the statement of the hon. and learned Gentleman, they did think that there were in the case he had laid before the House circumstances of so peculiar a character that they seemed to justify a departure from the ordinary cautious rule of the House. They must be very careful to draw a line in these cases. They knew it might be very easy to push cases of this kind a little further; and, as was said in common parlance, "hard cases make bad law." It might very possibly be that if they undertook to make inquiries into cases of an extraordinary and exceptional character, they might ultimately find themselves in a position of some embarrassment and difficulty. They must also bear in mind that a great number of cases which arose with respect to foreign loans, were cases of a very different character from those which were referred to by the hon. and learned Gentleman, and were cases in which they should be doing a great deal of mischief, and, perhaps, a great deal of injury to the country if they attempted to interfere. Therefore, it must be with extreme caution and consideration that they entered into the inquiries which the hon. and learned Gentleman proposed to them. But the motives which led the Government to believe it was desirable to grant this Committee were these—they found from the statement of the hon. and learned Gentleman that there was not at present, in his opinion—and his opinion upon the subject must be looked upon as a very high one—any sufficient and satisfactory way of dealing with cases of this kind such as there was in cases of ordinary fraud. The hon. and learned Gentleman told the House he could not discover a remedy, but that he thought if a Committee were appointed, they might, by investigating the case more fully, be able to discover a remedy. And this, at least, was quite certain—that if the House were to legislate at all upon the question of foreign loans, it was extremely important that they should be able to investigate these cases very carefully, and have lights thrown upon them by persons who were able to give them information with regard to foreign loans of different characters, so that care night be taken in any legislation they might undertake not to do mischief in the case of those foreign loans which were wholly free from any taint such as that referred to by the hon. and learned Gentleman. Therefore, upon the whole, with great caution and some misgiving lest it should be drawn into a precedent for going beyond the circumstances of the present case, the Government did, for the sake of endeavouring to find out a way to some legislation that might meet cases of this kind, assent to the appointment of a Committee. But he hoped the hon. and learned Gentleman would put himself in communication with the Government, and that great care might be taken in the selection of the Gentlemen appointed to serve upon the Committee, and that great care might also be exercised in the conduct of the inquiry. He was quite satisfied, from the way in which the hon. and learned Gentleman had made this Motion, that he was prepared to proceed upon it in that spirit, and in that spirit it was that he (the Chancellor of the Exchequer) assented to the Motion.

Motion agreed to. Select Committee appointed, "to inquire into the circumstances attending the making of Contracts for Loans with certain Foreign states, and also the causes which have led to the nonpayment of the principal moneys and interest duo in respect of such Loans."—(Sir Henry James.) And, on March 1, Committee nominated as follows:—Mr. LOWE, Mr. Stephen Cave, Mr. ELLICE, Mr. BOURKE, Mr. SOLICITOR GENERAL, Mr. WATKIN WILLIAMS, Mr. EDWARD STANHOPE, Mr. WALTER, Sir CHARLES RUSSELL, Sir CHARLES MILLS, Mr. EULESTON, and Sir HENRY JAMES:—Power to send for persons, papers, and records; Five to he the quorum.