Commons Sitting of 10 August 1876

MINUTES.
Public Bills—Committee—Cruelty to Animals* [250]—R.p.
Committee—Report—Consolidated Fund (Appropriation)*; Norwich and Boston (Corrupt Voters) [244]; Chairmen's Jurisdiction (Ireland)* [286]; Parliamentary and Municipal Registration (Boroughs) (re-comm.)* [229–294].
Considered as amended—Third Reading—Expiring Laws Continuance* [281], and passed.
Third Reading&—Bow Street Police Court (Site)* [257]; Sheriff Courts (Scotland)* [289]; Agricultural Holdings (England) Act (1875) Amendment (changed from "Queen Anne's Bounty")* [278], and passed.
Withdrawn—Local Loans (Ireland)* [231]; Public Record Office* [262]; Parliamentary Elections and Corrupt Practices* [291]; Clean Rivers* [279].

TURKEY—LOANS OF 1854 AND 1871.

  QUESTION.
  MR. ERRINGTONasked Mr. Chancellor of the Exchequer, What amount has been remitted from Egypt to the Bank of England since the first of October last, for the service of the Ottoman Loans of 1854 and 1871; and, what amount now remains in the Bank of such remittances?
  THE CHANCELLOR OF THE EXCHEQUER, in reply, said, he had received the following from the Bank of England:—
  "Statement of amount remitted from Egypt to the Bank of England for the service of the Imperial Ottoman Loans of 1854 and 1871, since the 1st October, 1875, and of the balances at present in hand.

  "IMPERIAL OTTOMAN LOAN OF 1854.

  "Amount received since 1st October, 1875

  £130,536

  2

  3

  "Balance in hand at this date

  61,150

  4

  10

  "IMPERIAL OTTOMAN LOAN OF 1871.

  "Amount received since 1st October, 1875

  £199,500

  0

  0

  "Balance in hand at this date

  116,922

  10

  0

  "(Signed)

  F. May,

  "Chief Cashier.

  "Bank of England, 10th August, 1876."

THE APPROPRIATION ACT.

  QUESTION.
  GENERAL SIR GEORGE BALFOURasked Mr. Chancellor of the Exchequer, If he will move for the appointment of a Select Committee, immediately the

  967
  House re-assembles, to inquire into the various changes made during modern times in the Appropriation Acts; also into the Exchequer and Audit Act (29 and 30 Vic. c. 39); the nature and extent of the audit applied to—the income and charge of the Consolidated Fund, the Civil Service Voted Funds, and Naval and Military Receipts and Expenditure; also as to the rules, orders, and forces for the audit business made by the Comptroller and Auditor General; also into the orders and instructions issued by the Treasury, or of those that might or ought, but have not been issued; and, finally, as to the form in which the resolutions should be drawn up for the decision of Parliament regarding the surpluses, excesses, deficiences, and other details, not alone, as at present, for the Naval and Military expenditure, but of the whole expenditure of every kind?
  THE CHANCELLOR OF THE EXCHEQUER, in reply, said, that the various matters referred to in the Question of the hon. and gallant Gentleman appeared to be matters which would properly come under the cognizance of the Committee on Public Accounts. If the hon. and gallant Gentleman was dissatisfied with what was done in respect to any of these matters, and if he would formulate his charge next Session, so as to let the Government see precisely what were the points of which he found reason to complain, there would be every disposition to find the means of inquiring into any allegations which he might make.

NAVY—THE SUPERINTENDENTS OF HER MAJESTY'S DOCKYARDS.

  QUESTION.
  MR. E. J. REEDasked the First Lord of the Admiralty, If any official remonstrance has been sent to the superintendents of Her Majesty's Dockyards against the cutting of ventilating apertures in the watertight bulkheads of Her Majesty's ships; and, if so, whether he will lay the Correspondence on this subject between the Admiralty and the Dockyards upon the Table of the House?
  MR. HUNT, in reply, said, that no remonstrance had been sent, because the communications passing between the Admiralty and the Dockyards did not take the shape of a remonstrance;
  968
  but the Board of Admiralty had expressed very strong dissatisfaction at what had taken place, and if the hon. Member would move for the correspondence it would be laid on the Table.

NAVY—DETERIORATION OF BOILERS.

  QUESTION.
  MR. E. J. REEDasked the First Lord of the Admiralty, If he will inform the House, by laying documents upon the Table or otherwise, what results, if any, have followed the appointment, in April 1874, of a Committee to consider the rapid deterioration of boilers in Her Majesty's ships?
  MR. HUNT, in reply, said, that the Committee appointed to inquire into the causes of deterioration of boilers in Her Majesty's ships had already made two preliminary Reports to him; but he was hoping that they would, before long, make a final Report. They were waiting the results of some experiments which they had directed to be made in connection with the subject into which they were inquiring.

CHANNEL ISLANDS—ROYAL COURT OF JERSEY.—QUESTION.
MR. LOCKEasked the Secretary of State for the Home Department, Whether it is not contrary to constitutional usage for Orders in Council and Acts of Parliament, which are sent to the Royal Court of Jersey for registration, to be referred to the State Assembly for discussion; whether the States of Jersey, at their sitting on Friday 20th July last, decided not to register the Order in Council respecting the ecclesiastical district at Gouray, and also refused to register the Acts of Parliament which have been transmitted; and, whether, in the event of such refusal, Her Majesty's Government will send a peremptory order for registration?
MR. ASSHETON CROSS, in reply, said, it was not contrary to Constitutional usage for Orders in Council and Acts of Parliament which were sent to the Royal Court of Jersey for registration to be referred to the States Assembly for discussion. It was obviously a proper course when the Court was of opinion that such registration would prove prejudicial or the Island was not specially included in an Order or Act of Parliament, and in

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any case of refusal Her Majesty s Government would await the receipt of any representation the Assembly might wish to make. No such representation had been received respecting the ecclesiastical district at Gouray.

AFRICA—THE GOLD COAST—CASE OF MESSRS. SWANZY.—QUESTION.
MR. ALDERMAN W. M'ARTHURasked the Under Secretary of State for Foreign Affairs, Whether he has any objection to lay upon the Table, Copy of the Correspondence with the Dutch Government relative to the plunder and destruction of Messrs. F. and A. Swanzy's property at Dix Cove, on the Gold Coast, in the year 1869?
MR. BOURKE: The claim of Messrs. Swanzy on account of destruction of their property on the Gold Coast was repeatedly brought before the Dutch Government. There was a conflict of evidence as to the facts, and the Dutch, relying on the reports of their own officials as contradicting the statement of Messrs. Swanzy's witnesses, refused to entertain their claim. There is not the slightest probability of their altering their decision. It would not be advisable to incur the expense of printing the Correspondence, which is very voluminous, extending over four years. Its publication would lead to no result.

PRICE OF GAS.—QUESTION.
MR. ALDERMAN W. M'ARTHURasked the President of the Board of Trade, Whether, in the event of any scheme being submitted to the Board of Trade for the amalgamation of the South Metropolitan Gaslight and Coke Company with any other Gas Company, the Board of Trade will make provision in such scheme that the maximum and standard price of 3s. 6d., limited by the Acts relating to the South Metropolitan Gaslight and Coke Company for gas supplied within the district of that Company, shall continue to be the standard price for gas within that district?
Sir CHARLES ADDERLEY: Until such a scheme as is supposed is submitted I am unable to say beforehand what provision it would be necessary to insert in it before the Board of Trade could recommend it for confirmation by Order in Council.

ARMY—MILITIA SURGEONS.

  QUESTION.
  CAPTAIN NOLANasked the Secretary of State for War, If the new Warrant relating to Militia Surgeons will not in some cases reduce the net income of these officers by over £100 a-year; and, whether, in such cases, he will allow existing Surgeons to retain their present appointments with the allowances which were in force when they accepted these appointments; or, failing this, will he grant them an adequate compensation?
  MR GATHORE HARDY, in reply, said, that the income of Militia medical officers derived from Army Votes depended upon so many considerations that it was impossible to give an answer to the Question put by the hon. and gallant Member whether the new Warrant would not in some cases reduce the net income of these officers by over £100 a-year. It depended upon the establishment of the regiment, upon the number of recruits, whether the regiment went out for training, and if so, for a long or short period. For instance, the Irish Militia did not train for several years, and therefore the emoluments of the surgeons would be very small indeed. He had already stated that it was not his intention to enter upon the consideration of this question until after the 31st December, because by that time he should know what Militia surgeons intended to accept the new terms.

THE WAR IN THE EAST.—QUESTION.
MR. MONKasked the First Lord of the Treasury, Whether the Government will take steps during the Recess, by the publication in the London Gazette (as in the case of the Brussels protocols) or otherwise, to supply such information respecting the war in the East, or negotiations for peace, as would be presented to Parliament during the Session?
MR. DISRAELI: I believe it has always been the custom during the Recess to keep the country well informed of important events, either in war or diplomacy; and I see no reason why that custom should be departed from.

CRIMINAL LAW—DIETARY OF MILLBANK PRISON.—QUESTION.
MR. ROWLEY HILL (for Sir EDWARD WATKIN)asked the Secretary of

971
State for the Home Department, Whether the dietary now in force for Military prisoners in Millbank Prison has been brought under his consideration; and, whether it is the fact, that the dietary and discipline of Military prisoners at Millbank has within the last two years been modified by the governor, on the advice of the surgeon, in above a thousand cases?
MR. ASSHETON CROSS, in reply, said, that the scale of dietary in force for military prisoners in the prison referred to by the hon. Member was brought under his consideration in June last, and that, in conjunction with the Directors of Prisons, he had ordered it to be altered. It was therefore different now in some material points from the dietary in force at the time referred to by the hon. Member. The matter was still under consideration, and he would see what further modifications were necessary.

ARMY—CASE OF LIEUTENANT WALKER.—QUESTION.
MR. GIBSONasked the Secretary of State for War, If it is true that Lieutenant R. F. Walker, 30th Regiment, died on the 8th of July 1876 in consequence of injuries received in consequence of a fall from his horse whilst acting as A.D.C. to Sir Thomas M'Mahon during a cavalry field-day at Aldershot on the 28th of June 1876; whether the fall was not occasioned by Lieutenant Walker's horse putting his forelegs in a concealed drain without any default on the rider's part; whether the War Office has not declined to pay to Lieutenant Walker the price of his commission; and, whether, under the circumstances of the case, he will make a special recommendation to have the whole or some part of the price of Lieutenant Walker's commission paid to his family?
MR. GATHORNE HARDY, in reply, said, it was unfortunately true that Lieutenant Walker died in consequence of a fall from his horse at Aldershot without any default on his part. The War Office had no power to pay to the family of Lieutenant Walker the price of his commission, and the Army Purchase Commission, acting under an Act of Parliament, had no power to do so. Any special recommendation from him on the subject would, therefore, be useless.

ARMY—COMMISSION ON RETIREMENT AND PROMOTION.—QUESTIONS.
CAPTAIN NOLANasked the Secretary of State for War, If a portion of the press were furnished with or had obtained copies of the Report of the Commissioners on Retirement and Promotion in the Army, at a date on which no copy, manuscript or printed, of such Report was accessible to Members; and, if steps can be taken to prevent Members from being again placed at a similar disadvantage?
MR. GATHORNE HARDY, in reply, said, that the Report of the Royal Commission was addressed to the Queen, and not to that House. He had promised that the Report should be in the hands of Members as soon as possible. Only a limited number of copies could be at first obtained, and when he was applied to, to allow the publication of the Report in the Press he thought that as the public took so much interest in the matter, there could be no objection to publicity being given to it. He had only taken the usual course in such matters. He could not lay the Report by itself on the Table; but the whole of the Report and appendices would be laid on the Table on or before Saturday next.
Sir HENRY HAVELOCKasked the Secretary of State for War, Whether a certain number of copies of the Report of the Royal Commission on Promotion and Retirement in the Army have been distributed to the London press in print, while none are in possession of Members of the House; and, if so, what prevented the printing of copies to be furnished to Members of the House at the same time as to the press?
MR. GATHORNE HARDYsaid, that the full number of copies could not be distributed in the time proposed. The Report alone had been allowed to be printed in the newspapers, and hon. Members were thus made acquainted with the recommendations made to Her Majesty quite as soon as the public.

CHURCH OF ENGLAND—HALIFAX VICARAGE—VICAR'S RATE.

  QUESTION.
  MR. J. G. TALBOTasked the Secretary of State for the Home Department, Whether the inhabitants of Halifax are still under an obligation to pay the Vicar's

  973
  Rate; and, if so, what steps the Government intend to take in regard to this matter?
  MR. ASSHETON CROSS, in reply, said, there was no doubt that so long as the Act of 1829 remained unrepealed the inhabitants of Halifax were legally responsible for the payment of the Vicar's Rate. The Government were not prepared to surrender, without any quid pro quo, that portion of the rate levied on houses, amounting to £970 a-year. In order to show that the Government were desirous of compromising the matter, they would consent to repeal the Act on condition that £11,600–12 years' purchase—was contributed by voluntary subscriptions and paid over to the Ecclesiastical Commissioners in respect of the rate on houses. The Government were of opinion that, when the inhabitants compared this settlement of the question with their position under the Act of 1829, they would be disposed to take advantage of the opportunity afforded to them.

HARBOURS OF REFUGE—DOVER.

  QUESTION.
  GENERAL SIR GEORGE BALFOURasked Mr. Chancellor of the Exchequer, If, before giving final sanction to more public money for Dover, he will afford time and opportunities for the many authorities along our exposed sea coasts to petition against spending or lending any more public money for attempting to form a Military and Naval Harbour at Dover until the many other and urgently needed Harbours are provided for our commerce, for fishings, and for refuge?
  THE CHANCELLOR OF THE EXCHEQUER, in reply, said, that if the Government decided on proceeding with a Bill next Session for the improvement of the harbour of Dover, it would be the duty of the Government to give public notices in November. There would, therefore, be ample time and opportunity for any persons to petition against the Bill if they should desire to do so.

PHŒNIX PARK, DUBLIN.—QUESTIONS.
MR. BUTTasked the Secretary to the Treasury, Whether he is aware that the Commissioners of Public Works in Ireland have inserted in the public papers
974
an advertisement proposing to let for a term of at least seventy-five years Whitefield Lodge and grounds, which are stated in the advertisement to form a portion of the north end of the Phœnix Park, and to contain about three acres of land; whether he will explain the circumstances under which this alienation of a portion of the Phœnix Park is proposed; and, whether the sanction of the Lord Lieutenant of Ireland has been given to the proposal?
MR. CALLAN: Before the hon. Gentleman answers the Question, I should like to ask whether his attention has been called to the fact that some portion of the property has been let out for milch cows?
MR. W. H. SMITH, in reply, said, he was aware that the Office of Works in Dublin proposed to let Whitefield House. It had been formerly the residence of the late bailiff of the Park, who had a salary of £250 a-year, and it was considered advisable to provide for his successor a more suitable residence. He would inquire whether the opinion of the Law Officers of the Crown had been taken in the matter, but he believed the transaction had met the full approval of the Irish Government. He would inform himself further as to the affair, and would afterwards communicate with the hon. Member.

INDIA MUSEUM.—QUESTION.
MR. FAWCETTasked the Under Secretary of State for India, Whether he is prepared to give an assurance to the House that no arrangement shall be entered into during the Recess which will throw upon India any permanent charge for the erection or maintenance of an Indian Museum in London?
LORD GEORGE HAMILTON, in reply, said, that the Government of India had entered into a temporary arrangement for the exhibition of the Indian Museum at South Kensington which would not terminate until Christmas, and between now and next Session no arrangement would be made which would throw upon India any portion of the expense of the Indian Museum.

CRIMINAL LAW (IRELAND)—TRIAL OF CLAFFEY.—QUESTION.
MR. CALLANasked Mr. Solicitor General for Ireland, Whether a second

975
counsel had been assigned by the Crown, and feed by the Treasury, for the defence of the prisoners Burke at Nenagh, Moore at Mary borough, and Montgomery at Omagh; and, whether his attention has been called to the circumstances under which the prisoner Claffey is now for a fourth time to stand his trial at Tullamore, and considering that the trial at last assizes proved abortive, through no default of the prisoner, he will advise that both the counsel hitherto defending the prisoner be assigned by the Crown to defend him at the adjourned assizes to be held on Wednesday next?
THE SOLICITOR GENERAL FOR IRELAND (Mr. PLUNKET): As far as I have been able to ascertain, the facts with regard to the prisoners Burke and Montgomery, set forth in the Question of the hon. Gentleman, are accurately stated by him. As to the second portion of the hon. Gentleman's Question, I am informed that the Attorney General for Ireland has authorized the appointment of two counsel to defend the prisoner Claffey, and I believe that the same able counsel who previously appeared will be at his service again.

CRIMINAL LAW—POLICE AT PLYMOUTH.—QUESTION.
MR. HOPWOODasked the Secretary of State for the Home Department, Whether his attention has been called to the circumstances detailed in a Letter, dated the 2nd day of August, from a Mr. William Glasson, addressed to the Secretary of State for the Home Department, complaining of the conduct of Inspector Anniss, of the Metropolitan Police, now acting in the neighbourhood of Plymouth and Devonport under the Contagious Diseases Acts, 1866 and 1869, accusing that officer of arresting, questioning indecently, and threatening a highly respectable young lady at Mutley, near Plymouth, on the night of the 26th of July; whether Captain Harris on being complained to did not on the 5th of August reply to the complaints—
"I have the Reports now before me, and from these I gathered that Inspector Anniss was not near the place named on the day in question. It is quite evident to me that some person must have personated Inspector Anniss (probably an Agent of the Contagious Diseases Acts Repeal Association), as I have the testimony of many
976
persons that Inspector Anniss wag on the Hoe at the time named.
"I fear you have fallen into bad hands.
(Signed) "WILM. C. HARRIS,
"Assistant Commr."
whether such an answer will be considered by him decorous and satisfactory; and, whether under all the circumstances he will not cause an independent inquiry to be made into the facts?
MR. ASSHETON CROSS: My attention was called to the letter of Mr. Glasson, and I immediately directed the ordinary inquiries to be made in the usual course. I regret to find that the letter quoted by the hon. Member has been written by Captain Harris. I think it very injudicious, and I am sorry he should have written it. With regard to the case itself, I have only received this afternoon the full reports on the conduct of the police. They are of considerable length, and I am unable at present to form any opinion on the matter. I think it right to say that the Inspector denies, in the most positive manner, the truth of the statement from beginning to end. He says he was not at the place mentioned, and knows nothing about the matter. I am not quite certain whether the proper course would not be to leave the matter to the ordinary tribunals of the country, so that the charge may be tried in open court before the magistrates. Should this be done, I shall give every facility in my power to have the matter properly investigated, and I think that such a course would be more satisfactory than a private inquiry.

NAVY—VESTMENTS OF NAVY CHAPLAINS.—QUESTION.
MR. HOLTasked the First Lord of the Admiralty, Whether his attention has been called to the circumstances that, by a judgment of the Dean of Arches, it has been declared to be unlawful for clergymen of the Church of England to wear a vestment called a "stole;" whether chaplains in the Navy are not bound by that decision; and, whether the Admiralty will take steps to enforce the observance of the Law as thus declared by chaplains in the Navy?
MR. HUNT: My hon. Friend alludes, I presume, to the Purchase Case, in which a decision was given that it was unlawful for the defendant to wear a stole. A very high authority has, however, given

977
his opinion officially that chaplains may wear stoles. In his address to the chaplains of the Army in 1867, the Chaplain General used these words—
"Being chaplains appointed by the Sovereign, you are each of you entitled to wear a plain black stole or scarf with your surplice."
This address has been made a circular by the War Office, and though part of the instructions contained in it have been revoked in consequence of the Purchas judgment, the passage relating to stoles remains in force. I cannot, therefore, look upon the matter as free from doubt.

PARLIAMENT—BUSINESS OF THE HOUSE.—QUESTIONS.
SIR WILLIAM HARCOURTinquired when the Papers respecting Bulgaria would be in the hands of hon. Members?
MR. BOURKEsaid, that on learning that it was the intention of the hon. Member for Poole (Mr. Ashley) to call the attention of the House to the subject of the atrocities, he had arranged for the printing of Papers, and 50 copies would be in the hands of the Librarian of the House by 9 o'clock that evening.
MR. W. E. FORSTERasked the First Lord of the Treasury whether he proposed to have a Morning Sitting tomorrow?
MR. DISRAELI: I think it will be convenient for both sides of the House if we meet to-morrow at 3 o'clock. The third reading of the Appropriation Bill will be the first Order.
In reply to Mr. GOSCHEN,
MR. DISRAELIsaid, that if the minor measures put down on the Paper took up too much time to allow of a full discussion on the Indian Budget that night, he would move the Adjournment of the Debate.

THE EXTRADITION TREATY WITH THE UNITED STATES.

  OBSERVATIONS.
  SIR WILLIAM HARCOURTsaid, with reference to the Resolution he had on the Paper with respect to the Extradition Treaty with the United States, that the right hon. Gentleman at the head of the Government had promised him a day to bring it on after the Merchant Shipping Bill had been disposed of. He had no doubt that the right hon.
  978
  Gentleman had done all he could in the matter; but on the day that was offered he could scarcely expect to engage the attention of the House, and should therefore, although very unwillingly, postpone the Motion. If diplomacy had not meanwhile settled the question, he would bring it forward early next Session.

CONSOLIDATED FUND (APPROPRIATION) BILL.
(Mr. Raikes, Mr. Chancellor of the Exchequer, Mr. William Henry Smith.)
CONSOLIDATED FUND (APPROPRIATION) BILL.

  COMMITTEE.
  Bill considered in Committee.
  (In the Committee.)
  Clause 1(Issue of £28,703,043 out of the Consolidated Fund).
  MR. BUTTsaid, he did not wish to detain the Committee, but he confessed that he should like to have some little more explanation than had yet been given with regard to the question which had been brought before the House by the hon. Member for the City of Dublin with regard to the distribution of advertisements among the newspapers. In olden times the giving of Government advertisements—
  The CHAIRMAN: The hon. Gentleman is not in Order in calling attention to this subject on this clause.
  MR. BUTTsaid, the clause included every Vote of money, and included the very Vote for this money. He apprehended that put him in Order; if not, he would wait until they came to another clause. But he apprehended this clause appropriated the whole money for the year, and unquestionably the money paid for advertising. He believed he was in Order.
  THE CHAIRMAN: The Question has not yet been put—I put this clause to stand part of the Bill. If the hon. and learned. Member wishes to proceed now it is an unusual course. It would lead to much discussion if any item of expenditure were to be discussed while the clause is in this position. The more usual practice is to raise questions of this description before going into Committee.
  MR. BUTTsaid, that even if there was an appearance of his being out of Order, it was owing to the new form in which the Appropriation Bill was framed. Surely he would be at liberty to proceed

  979
  in a clause under which the money whose expenditure he wished to criticize was being appropriated. In the olden time these advertisements were a sort of subsidy to the Press. There were some curious passages in Lord Castlereagh's despatches as to the uses which were made of newspapers; but he thought they ought to establish the principle, and also to act upon it, that the advertisements should be inserted in papers for the sake of attracting public attention, and not for the sake of subsidizing any paper. It was obvious that was not the case now; but he believed that advertisements were given as a matter of favour, according to a list prepared by some persons at head-quarters. He did not complain of this Government in particular, but of all Governments; and he did think the time had come when they should abandon the practice he had referred to, and when advertisements should be put in the papers for the sake of publicity only, and not for the sake of the support they gave to the current Administration, and. those advertisements should not be withdrawn because the paper did not support them. He should like to have some assurance that the bad practice would be abandoned, and that abandonment would be another addition to the good changes which the present Government had founded. If not, he should take an opportunity next early Session of bringing the matter before the House.
  SIR MICHAEL HICKS-BEACH: I fear I can give no more information then I did yesterday. As a matter of fact, the only advertisements over which I have control are those which are issued from the Chief Secretary's Office, and those are inserted in The Freeman's Journal. I do not control the advertisements issued by the War Department or other Departments, and that is all the information I can give.
  MR. BUTTsaid, his observations were not directed to the right hon. Baronet's Department in particular, but he complained of the general system.
  GENERAL SIR GEORGE BALFOURthought a Return ought to be laid on the Table of the newspapers to which Government advertisements were sent. There was no difficulty in furnishing that information, for a list of all the newspapers usually appeared in the Circular Orders of the Army, and if he
  980
  did not err, a list had just appeared in the recent Army Circulars, which hon. Members could buy. No doubt, the political Party in power did vary the lists of newspapers in which Government advertisements could be inserted, but all the power rested with the Treasury. It had been, and still was, a petty political kind of bribery, which both political sides should now repudiate. Both Parties favoured their respective newspaper advocates; and if the Liberal papers received more advertisements than the newspapers which supported the Conservative side, it was because the newspapers were in general more numerous than those of the other side. It was, however, a paltry affair, and injurious to the public interests, for notices should be sent to papers which could give the greatest circulation.
  MR. J. COWENsaid, that fortunately or otherwise he was a newspaper proprietor, and so far as his experience went it was exactly the contrary of what the Chief Secretary had stated to be the custom. He believed it was notorious that when the Whigs came into Office they had a lot of papers to which they gave their advertisements, and when the Tories were in office they gave their advertisements to others. It was a most objectionable practice, and was derogatory to the Press. Government put their advertisements in the papers for the purpose of selling their wares or getting what they wanted. Their object should be to bring their intimations well before the public. This principle was not acted upon. He knew newspapers in this country that had been almost entirely supported by subsidies got from Government. He could not speak exactly as to the figures; but he believed there was something like £50,000 paid for advertisements in the year, and a great proportion went when the Conservatives were in Office to the Conservative newspapers, and when the Liberals were in Office to the Liberal newspapers. As an instance of the absurdity of this practice, he found a Government advertisement for iron ware in a paper in the North of Scotland, with a circulation of about 400 copies; and he had seen advertisements in papers on the West Coast of England for Newcastle coals. This was not done for publicity, but for the support of Party newspapers. There were some papers which, like certain politicians, took their

  981
  colour from the atmosphere around them; but these were exceptional, while what he had stated was an absolute fact, that Conservative Governments gave their advertisements to Conservative newspapers, and Liberal Governments gave theirs to Liberal newspapers, utterly irrespective of what was required in the interests of the nation.
  Clause agreed to.
  Clauses 2 and 3 agreed to.
  Clause 4 (Treasury may, in certain cases of exigency, authorize expenditure unprovided for; provided that the aggregate grants for the navy services and for the army services respectively be not exceeded).
  MR. MONKmoved that the clause should be so amended as to provide that Notice should be given to Parliament within 10 days of the appropriation of money by the Treasury in cases of emergency to any of the public services of the country.
  GENERAL SIR GEORGE BALFOURpointed out that the defects of the clauses in the Appropriation Act had already been under the notice of the House, and Notice of the changes needed therein had already been given, and as he had understood from the Chancellor of the Exchequer, an inquiry would be granted next Session, in order to remedy the kind of shortcomings by the spending Departments, which had been brought before the House, in the case of the naval expenditure, the Admiralty having largely exceeded the estimated sums without the permission or knowledge of the Treasury.
  THE CHANCELLOR OF THE EXCHEQUERthought the suggestion an important one, but urged that its consideration should be postponed until next Session.
  MR. CHILDERSsuggested that the whole subject should be referred to the Public Accounts Committee.
  THE CHANCELLOR OF THE EXCHEQUERsaid, his intention was to deal with the question in the way suggested by the right hon. Gentleman.
  Amendment, by leave, withdrawn.
  Clause agreed to.
  Remaining clauses agreed to.
  Bill reported, without Amendment, to be read the third time To-morrow.

EAST INDIA REVENUE ACCOUNTS.

  COMMITTEE.
  Order for Committee read.
  LORD GEORGE HAMILTON, in rising to move that the Speaker leave the Chair to go into Committee on East India Revenue Accounts, explained that he had taken this somewhat unusual course in consequence of the number of Amendments which had been placed upon the Paper, and with a view of making one continuous statement upon the many subjects included in an Indian Budget. The figures which would come under the consideration of the House to-night were those connected with the revenue and expenditure of the financial years 1874–5, 1875–6, and 1876–7. The estimates for the two earlier years had already been brought under the notice of the House, but those of the last had not. He proposed to take first the ordinary expenditure of the three years to which he referred, and then to add to it the extraordinary expenditure upon public works; and, finally, to make some observations as to the effect of the fall in the value of silver upon the general revenue and expenditure of the country.
  In the financial year 1874–5 the Budget estimate of Indian revenue was placed at £48,984,000, and the expenditure at £50,580,000, showing an estimated deficit of £1,388,000, but this deficit arose from the famine expenditure of £2,580,000. According to the regular estimate the revenue for the year would have been £50,070,400, and the expenditure would have been £50,564,000, leaving a deficit of £494,000. The actual revenue, however, was £50,570,171, against an actual expenditure of £50,250,974, showing an actual surplus of £319,197. There was thus an actual result better by £1,707,197 than the Budget estimate. This was due to an increase under nearly every head of revenue and to a postponement of certain famine charges, the surplus, excluding the famine charges, being over £2,500,000.
  Comparing the finances of the year 1874–5 with those of the preceding year, he found that the revenue showed an increase of £971,918, while there was a decrease in the expenditure of £1,154,947, which was due to reduced

  983
  famine charges, the net revenue from salt being increased by £92,716, and being better than the Budget estimate for 1874–5 by £176,000, notwithstanding the abolition of 800 miles of the Customs line.
  Coming to the year 1875–6, he had to announce a still more gratifying result. The revenue for that year was estimated in the Budget at £49,820,000, against an estimated expenditure of £49,314,000, showing an estimated surplus of £506,000; according to the regular estimate the revenue would have been £50,994,872, against an expenditure of £49,751,373, showing a surplus of £1,243,499; but from recent telegrams it appeared that the revenue for the year was now estimated at £51,254,872, against an expenditure of £49,620,373, showing a surplus of £1,634,499. The surplus would have been considerably more had not a famine charge amounting to £656,587 been postponed from the previous year. The net result of the gross famine expenditure was, for the year 1873–4, £3,864,673, leaving a deficit of £1,807,668; for the year 1874–5, £2,237,860, when there was a surplus of £319,197; and for the year 1875–6, £656,587, when there was an estimated surplus of £1,634,499. There was thus a famine expenditure of £6,700,000 in three years, with a surplus of £150,000, or, exclusive of that expenditure, an annual surplus during those three years of £2,300,000. This was a convincing proof of the elasticity of the revenue of India, and compared favourably with the result of the Irish Famine, in which case, out of a total expenditure of £10,000,000, only £2,000,000 was paid out of revenue. The revenue for 1875–6, according to the recent advices, showed a considerable increase as compared with the Budget estimate under nearly every head and the increase, exclusive of opium, amounted to about £1,000,000. The Budget estimates had been high, and the Customs loss by the Tariff Act was estimated for the financial year at £266,000, the estimated annual loss being £300,000, the Act having been passed in the middle of the financial year. In place of that loss, however, it is now estimated that the Customs revenue will exceed the Budget estimate by £35,000. There had also been an increase in the revenue from salt and stamps.
  984
  There was one circumstance to which he particularly desired to call attention. When the Prince of Wales's visit to India was first mentioned in that House, certain hon. Members had objected to it on the ground of the expense it would entail upon the country. One result of the visit, however, had been that it had brought a considerable amount of revenue into the Indian Exchequer in the following way:—There had been a great reluctance on the part of all classes of the Natives of India to use the railways, but they had overcome that reluctance in their anxiety to see the Prince of Wales, and a very large number of them, having once overcome their prejudices in that respect, would appreciate the advantages which the railways afforded, with gratifying results to the revenue in future years to be derived from the lines.
  In estimating the receipts for this year the Indian Government had to take into consideration the growth of the revenue during the past two years as well as during the preceding years. He had been a little surprised the other day to receive a pamphlet entitled The Indian Budget for 1876, by Mr. John Dacosta, to which he should not have referred had it not been for its remarkable preface, in which it was sought to be shown that the Indian finances were not so flourishing as they had been represented to be. Attached to that pamphlet were many distinguished names—such as Sir George Campbell, Mr. M'Arthur, Sir Charles Dilke, Mr. Richard, and others, some of whom he was not aware had given much attention to the subject of Indian finance. The last name on the list, however, fully explained the fact. It was that of Mr. Chesson, the Secretary of the Aborigines Protection Society; and it would therefore appear that the gentlemen who had signed the pamphlet, being also members of that society, had signed it in that capacity. This circumstance, perhaps, accounted for the nature of the statements in that pamphlet, which certainly appeared to be somewhat aboriginal. It was rather a serious matter for a large number of Gentlemen occupying a Parliamentary position to attach their signatures to a statement to the effect that the Indian revenue was not so flourishing as it had been represented to be by the Government, and that, owing

  985
  to continued pressure, it had lost its elasticity. These Gentlemen, however, appeared to have compared the revenue of one year with that of another without in the slightest degree taking into account the reduction which had been made in the taxation, which was the same thing as though they were to assert that the Income Tax in this country had lost its elasticity because a 3d. tax now did not produce as much as a 6d. tax a year back. The two years in which the revenue was the highest hitherto known were the years 1869–70 and 1870–1. In 1869–70 the revenue amounted to £50,901,081, while in 1870–1 it amounted to £51,413,686. In 1875–6 it is estimated at £51,254,872. But in the years 1869–70 and 1870–1 the Income Tax was in operation, bringing in in 1869–70 £1,110,224, and in 1870–1£2,072,025. Other receipts not now included in the statements of revenue, but transferred to the Local Governments towards meeting charges for Provincial Services, amounted in 1869–70 and 1870–1 to £647,000, and in 1869–70 exceptional items to the amount of £850,000 were included under Land Revenue and Miscellaneous. If the Income Tax, which had since been remitted, and these exceptional receipts were deducted from the revenue of the two earlier years it would be found that taxes which in 1869–70 produced £48,300,000, and in 1870–1 £48,700,000, gave last year an estimated revenue of £51,254,872.
  From 1865–6 to 1874–5 the growth of revenue under the heads of Land Revenue, Excise, Customs, Salt, and Stamps was £3,186,948—an annual increase of over £300,000. The increase of revenue under all heads in 1874–5 over 1873–4 was £972,000, and in 1875–6, according to the most recent estimate, £682,000, or £1,654,000 in the two years. The Budget estimate was exceeded by £1,600,000 in 1874–5, and by £1,440,000 in 1875–6. For 1876–7 the Budget estimate of revenue is £50,480,000, and of expenditure £50,336,000, showing a surplus of £144,000. The expenditure is £584,000 more than was estimated in the regular estimate for 1875–6. The loss by exchange is estimated at £2,332,000, being an increase of £907,000. The old rule was that there should be a surplus of £500,000; but in the present year the Secretary of State did not feel justified
  986
  in increasing taxation to meet the very exceptional loss caused by the fall in the value of silver. If it had not been for the heavy expenditure there would have been a surplus of £1,000,000. The revenue showed considerable increase in several items. The increase on Excise was due more to efficient administration than to increased consumption. There had been a considerable increase in Stamps. The receipts from State railways were, in 1874–5, £130,986; in 1875–6, they are estimated at £277,000; and in 1876–7 at £415,000. Customs are this year taken low—at less by £85,000. That is a cautious estimate, as we had last year remitted certain duties under the Tariff Act.
  A change of Viceroy had occurred since the Budget had been issued. There was no part of Lord North-brook's administration that reflected more credit on him than that which related to the Army. When Lord Mayo went out to India he at once commenced retrenchment in Army expenditure. Indian Army expenditure might be divided into two heads—that which occurred in India, and that which occurred in England. Lord Mayo began the reform in India, and being a great master of detail, Lord Northbrook pushed it further. In 1869–70 the Army in India cost £12,800,000, and in England £3,500,000, and in 1876–7 it was estimated at £11,800,000 in India, and £4,000,000 in England. A considerable additional expense had been thrown on the Army charges, for there was an increase to the English soldiers' pay of £285,000, and to Native Regiments of £300,000. Yet this additional charge had been met by bonâ fide retrenchments, which had stood the test of time, and which left the efficiency of the Army unimpaired and the expenditure reduced. The English side was not so satisfactory, although it was abnormally swollen this year by certain commutations of pensions, which would give great ultimate relief. Two systems of recruiting, the long and the short service, had been tried in the past, and at the present moment we were hit by both. That portion of the long service pension, to which soldiers of 21 years were entitled, and for which India was liable, would annually increase for some few years; the establishments of European soldiers having been largely increased to stamp out the Mutiny. By

  987
  the short service system, initiated by Lord Cardwell, pensions were practically abolished, but the cost of recruiting establishments was largely increased, and they were now paying that increase, without being rid of the burden of pensions. Those Army charges would not decrease. India was a poor country, whilst England was a very rich country. India wanted English soldiers, and wanting them she must pay, not her own market price, but the price of the labour market of the country from which they came. The Secretary of War had constantly had this matter under his consideration, and if there had not been perfect agreement between him and the India Office upon all the details of his proposals, that was due not to any want of harmony between the two Offices, but to the difficulty of reconciling the fundamental principle of the short service system, the establishment of a reserve, with the requirements of India, a cheap and continuous supply of British soldiers.
  Having now placed the results of the revenue and ordinary expenditure of the last three years, he would pass on to the public works extraordinary. No part of the expenditure of the Indian Government was the subject of fiercer contention. To rightly appreciate the action of that Government their position a few years back should be considered. They felt bound to give India the benefits of a railway system, for the indirect advantages of rapid communication to a great Government were enormous. A rapid concentration of military force being possible in times of emergency, permanent reductions in time of peace and quiet could be effected as well as economies in civil administration. But private enterprize refused unaided to undertake these works; Government was compelled to give a guarantee, and this system proving very expensive was abolished during Lord Lawrence's Viceroyalty. In 1873, before we came into Office, a resolution was published by the Indian Government, by which the Government proposed to entirely substitute the principle of direct agency for that of the indirect agency of the Guaranteed Companies, and for that purpose they proposed to spend annually for the next five years £4,500,000; £3,000,000 on State Railways, and £1,500,000 upon Canals.
  988
  This sum was limited last year to £ 4,000,000. This expenditure was estimated to throw no fresh annual charges upon the revenues of India, the increased returns from works in operation balancing the interests of the loans borrowed. The opponents of the system said that it might be sound in theory, but it was not sound in practice; that, as a matter of fact, the Indian Government constructed works which did not pay interest on borrowed money, and that the liabilities were annually increasing without a corresponding increase of revenue. This was an assertion which it was easy to test, and he would compare two periods within Lord Northbrook's administration—the year 1872–3 and the year 1876–7. The expenditure upon public works extraordinary from 1872–3 to 1876–7 was £17,893,000, and the amount borrowed £14,683,000, the difference between the two being mainly made up by surpluses of ordinary revenue over ordinary expenditure. The charge for interest in 1872–3 was £5,857,458; the loss on the guaranteed railways did not amount to more than £2,110,501; and the State railways were worked at a loss of £5,500—making a total of £7,973,459; but the irrigation works gave a return of £413,535, which reduced the total charge on that year to £7,559,924. In 1876–7 the charge for interest was £5,750,000; the loss on guaranteed railways was £1,260,000; the State railways worked at a profit of £118,000, and the irrigation works yielded £527,000; the two making together £645,000, which, deducted from £7,010,000, the total for interest and guaranteed railways, left a net charge on the revenues of £6,365,000. In other words, although the debt was increased by £14,683,000, the loss to the revenue was £1,200,000 less. The redemption of the old East India Stock in 1873 effected an annual saving of £450,000 under the head of interest; against this, however, might be put the whole of the irrigation returns of Madras and Bombay, which, being indirect, he had not included in this comparison.
  It must be remembered that the climates of India differed as much as that of the North of Scotland from the South of Italy. In certain parts of India there was no rain whatever, and in the Punjab and Sindh and other places cultivation was impossible without water. It would

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  be found that the expenditure on irrigation paid where there was little or no rain; and only where there was much rain in the course of the year were the results unsatisfactory. In the Punjab the amount expended was nearly £ 3,000,000, and the return was 4½per cent. This was a somewhat severe test to apply, because the capital included all the money expended on works that were not yet in operation, and of course it was only those in operation that paid any interest. In the North-West Provinces there was a similar return of 4½ per cent. In Bengal, which included the Orissa works and some not yet in operation, the irrigation works involved a loss of 2½ per cent. The Madras and Bombay accounts were not passed as reliable by the Indian Government, inasmuch as there was some difficulty in ascertaining the exact increase of land revenue due to irrigation; but an account which he thought fairly reliable showed a return of 16 per cent in Madras and 15 per cent in Bombay. The State railways were paying well, as they were constructed under far more favourable conditions than others. They had cost £4,300 per mile without the Agra Bridge, in Rajpootana, and £5,300 per mile with it, as against £16,000 per mile; and therefore a return of £200 per mile repaid the interest on the capital borrowed at 4 per cent, while the guaranteed railways would require a return of £800 per mile to pay 5 per cent on their borrowed capital. We were, therefore, now constructing railways under far more favourable conditions than before.
  It was only natural that there should be great objection felt in this country to any Government borrowing money for reproductive works. It was contrary to the financial policy of this country, where we had always found private capitalists ready to undertake public works, and this objection had been somewhat confirmed by the recent example of Turkey and other Eastern Countries, which had borrowed large sums ostensibly in order to extend their public works, but had made other applications of the money. It did not by any means follow that if the system were honestly carried out it would not give good results. We had spent large sums in India, and the question often asked was—What had we got for our money?
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  If our property were put up for sale in the market would it realize anything like what we had expended upon it? The capital expended upon public works which were in any way connected with the Government was £125,000,000, of which £14,000,000 was spent on State railways, £17,000,000 on irrigation works, and £94,000,000 was guaranteed capital; and we found that this property had now brought in a net revenue in working receipts of £4,296,000; of which £118,000 was from the State railways, £708,000 from irrigation works, and £3,470,000 on account of the guaranteed capital. The State railway system was still in its infancy; the receipts were increasing; it was hoped that by careful management the working expenses could be reduced, and that in a short time the net revenue would be over £5,000,000. Therefore we had got a revenue of £4,300,000, annually increasing, and if we were to go into the market the property would probably realize not far short of what we had expended upon it. To give one instance of how working expenses might be reduced, he might mention that the cost of fuel per mile upon the Great Indian Peninsula Railway was six times what it was on the East Indian Railway, which was able to work coalfields, and when the Great Indian Peninsula worked coal, which it hoped to be able to do shortly, it would probably pay the guaranteed interest.
  The Secretary of State the first year he was in office laid down three principles as to public works; none were to be undertaken but those which would pay interest on borrowed capital; those that would not be remunerative were to be constructed out of Revenue, and loans were to be raised in India for public works. The Indian Government had last year substituted a somewhat different principle—namely, that India could afford to lose annually a certain sum upon these public works, but the Secretary of State had re-affirmed his instructions of 1874, as he could not recognize the principle that because some works were more remunerative than had been expected, the surplus was to be employed in unremunerative works. The classification of public works in India was not perfect; but the only works which were now included under the head of "extraordinary" were railways and canals. He objected to placing all under one

  991
  head, because it led to indifference as to the results in particular instances. He objected to any hard-and-fast line being laid down which would have the tendency to stop works, when there were large establishments open, mateterials purchased, and contracts made, the disregard of which might involve loss to the Indian Exchequer. He should like to see a further classification of works in the direction of handing over to the local authorities those in which they would take a greater interest when they saw they would profit by the results. The total expenditure on public works extraordinary, for three years was, or would be, as follows:—1874–5, £4,249,571; 1875–6, £4,146,873; and 1876–7, £3,759,000; and the deficit over ordinary expenditure was £3,930,374, £2,903,374 in the second, and £3,615,000 in the third, making £10,448,748, though the amount actually spent was £12,155,444. It was necessary that the Indian Government should carry on the public works, because they were the means of increasing the wealth and prosperity of India. Some of those works might turn out to be failures, but it would be very unwise to adopt an abstract Resolution, which, if rigidly carried, would stop all public works extraordinary. At the same time, he could not agree with those who ignored this extraordinary expenditure. It was a component part of the Indian financial system, and the outlay for this purpose must mainly depend on the condition of the Indian Exchequer.
  The expenditure for this year, including the public works extraordinary, having exceeded the revenue, it was necessary to raise a loan. Sir William Muir estimated that£360,000 would be received from Holkar and Scindia, and the Government would raise a loan of £2,640,000 at home. The Government actually raised a loan of £4,000,000, which it was assumed would be necessary to meet the ordinary expenditure of the year. That, however, was an error. The loan of that amount had been raised because it was not advisable to force the Government bills on the silver market, and the difference would be found in the increased cash balances at the end of the year, and did not represent any additional burden thrown on Indian finance, because the Government would be able to buy up a considerable amount
  992
  of rupee paper bearing 5½ per cent interest.
  Within the last few days he had received a telegram from the Indian Government stating that the Viceroy had issued circulars to the Departments urging economy and recommending a restriction of expenditure. That proceeding had been interpreted as foreshadowing an overwhelming deficit, to be met by loan, but the resolution of the Governor General in Council merely enjoined the cessation of all avoidable expenditure. Various telegrams had appeared in the newspapers stating that there had been a great falling off in the revenue of India, and that the loss upon the exchange would be not less than £4,000,000. He had telegraphed to India for any fresh figures, and was told, in reply, that the resolution of the Government only referred to the loss arising from the exchanges. That resolution was only issued a few days ago, and was based upon information contained in the mail which left the silver market in a state of depression, and trade at the lowest ebb.
  The only fear of deficit was from an apprehension of increased loss by exchange. So far, however, from there being a large deficit, he did not believe there would be any deficit at all. The revenue of the year had been cautiously estimated. There was an estimated falling-off in Customs and Salt, resulting naturally from the depreciation in the import trade and the working of the Tariff Act. It had also been stated, although not officially, that the opium advances would be this year considerably in excess of the amount estimated in the Budget. A certain amount of lands belonging to the Government was devoted to the cultivation of opium, and all opium produced by this land was bought by the Government. The advances made to the cultivator would be heavier than usual on account of the large crop; but any loss would be fully met by the increased opium revenue next year. If the revenue were deficient, owing to the increased opium advances, they would simply be discounting a large opium revenue next year. At the same time Lord Lytton, wishing to co-operate with the Government at home, had enjoined economy not only in the ordinary expenditure but in the extraordinary expenditure for public works. He would not, however, disguise from the House that the position

  993
  of the Government of India occasioned some anxiety, because the causes which increased expenditure and decreased revenue were not in any way under their control.
  He must now ask the House to carry their attention back to the commencement of the year 1876–7, at which time our revenue was in a most flourishing condition, the ordinary expenditure and the public works extraordinary were well under control, and, with one exception, everything seemed satisfactory. The one cause of anxiety was the loss by exchange produced by the fall in the value of silver. A few months back this depreciation of silver was a cloud no bigger than a man's hand, but during that period it had so rapidly grown that it now darkened and overshadowed the whole horizon of Indian finance. The fluctuations in silver were so sudden, the apprehension of all merchants trading with the East so general, that early in the Session he obtained leave to appoint a Select Committee to inquire the causes of this sudden depreciation, in order that the House might have an accurate diagnosis of the complaint. They were fortunate enough to secure the services of the right hon. Gentleman (Mr. Goschen) as Chairman, and all who had read his Report must have been struck by its lucid arrangement and the immense care displayed in its preparation. No one who was not upon that Committee could have any notion of the time and trouble which the right hon. Gentleman gave to the subject, and he would refer hon. Members to the Appendix if they wished to form an idea of the mass of printed evidence which he mastered and embodied in his Report. He was, therefore, very glad to have this opportunity of publicly thanking the right hon. Gentleman for having undertaken and discharged a most onerous duty, and to assure him that the result of his labours would be of the greatest benefit both to the Home and the Indian Government in guiding their subsequent action.
  He would not travel over any of the ground covered by the Report, but he should like to point out how, owing to silver being the standard of value in India, the fall of that metal affected Indian finance in a two-fold manner. The depreciation of the metallic currency of a country for all purposes of trade and commerce, espe-
  994
  cially external, was most inconvenient, but it did not follow that actual loss was inflicted upon the whole community within which the depreciated metal might have circulation. The recipients of fixed incomes and the creditors were, no doubt, injuriously affected, but, on the other hand, the self-adjusting laws of supply and demand would cause a rise in prices beneficial to the producer, while the Government of the country might be able, by raising the rates of taxation, to compensate itself for the lessened value of previous taxes. The financial position of India was, however, peculiar. About two-fifths of the income was land revenue, which, generally speaking, was fixed either permanently or for stated periods in silver. To the owners and occupiers of land, every fall in the value of a rupee in India was a gain purchased at the expense of the Government. At the same time, it must not be supposed that the purchasing power of the rupee in India was as much reduced as it was here, or that we had this year lost on every rupee of our land revenue the difference between the quoted value in London and the old normal value of the rupee. But the loss on the expenditure side was more serious. The requirements of the Indian Government necessitated at present an annual payment of about £15,000,000 sterling in this country. This gold liability had annually to be defrayed by India out of a silver revenue. Let them first consider for what purposes these annual payments were made; secondly, the different modes by which the necessary funds could be obtained; and, thirdly, the effect of each method of payment upon the exchanges between India and England. These home charges had risen during the last 20 years from £5,000,000 to £15,000,000. Superficial critics sometimes suggested that this increase was mainly due to the transfer of the Government of India from the East India Company to the Crown and to extravagance on the part of the India Office. A slight investigation of the purposes for which these payments were made at once disposed of any such notion. The East India Company was abolished in 1858. The last 20 years of its existence were the exact reverse of the first 18 years of the rule of the Crown. The first was throughout the world an epoch, if not of stagnation, at any rate one of slow progress.

  995
  The latter period had been one series of progressive bounds and leaps, chiefly due to the enormous spread of railways and other improved means of communication. There were many indications that the East India Company, upon the eve of its abolition, was on the point of increasing the Home expenditure. To collect revenue and maintain order could form but a portion of the duties of any civilized Government, and the Court of Directors adopted the system of guaranteeing interest upon capital employed in constructing railways, as being the only means of rapidly giving India a railway system. Since 1856 the annual interest on these railways, all of which had to be paid in England, had risen from £400,000 to nearly £4,700,000. Again, the suppression of the Mutiny made it necessary to raise large loans in this country, the interest on which had risen from£670,000 in 1856–7 to £2,250,000 in 1876–7. The mutiny of a large portion of the Native Army and its consequent reduction in numbers, caused the employment of a much larger European army in India, the home charge for which, excluding stores, had risen in the same period from £1,291,000 to £3,158,700. Again, the greatly increased demand for stores of all kinds, especially iron, which could not at present be manufactured in India, had caused an increase under that head of from £950,000 in 1856–7 to upwards of £2,000,000 in 1876–7.
  Taking, therefore, the three heads alone of Army expenditure, interest, and stores, they had an expenditure of over £12,200,000 at the present time, as against an expenditure of £3,320,000 in 1856–7. Again, there had apparently been a large increase in the superannuation charges, but that was mainly due to a change in account, by which all payments were now made "charges," and not classified, as in the days of the Court of Directors, as "remittances." So far from those charges being the result of the extravagance of the India Office, or due, as was sometimes stated, to the creation of fresh departments and offices, exactly the reverse was the case. These charges were the necessary consequence of the connection between India and England, and had arisen because India required certain
  996
  articles which she could only obtain from England. The administration of the India Office had been most economical. The amount of work performed was ten times greater than it was 20 years ago, yet the office expenses had but slightly increased during that period, and if they abolished the India Office to-morrow they would only save about £200,000 a-year, and he doubted if they could substitute any agency which would as cheaply and efficiently perform the same work. As the individual members of Council had no means of publicly defending themselves against the charges which were sometimes made against them, he took the opportunity of stating that in no public office were estimates more carefully checked and more thoroughly sifted than those which passed through the hands of the Finance Committee of the India Office, and no one who knew the number of proposals and applications rejected, in proportion to those which were sanctioned, could assert that the India Office was extravagant, or that these so-called home charges resulted from insufficient supervision. He could not, therefore, hold out much hope of an immediate reduction of those expenses, unless it were under the head of stores. They had written to the Indian Government suggesting that whenever it was feasible they should be purchased in India. A certain portion of these stores were for public works extraordinary, and if that class of work were curtailed a saving at home might be effected. From time to time, as the loans raised here and the arrangements made with the guaranteed companies came under revision, they hoped to obtain more favourable terms, and from time to time to effect certain economies; but, as he had shown, the great mass of the home expenditure lay outside the direct control of the Secretary of State, and he could not, therefore, hold out much hope of its immediate reduction.
  Having considered the purposes for which these charges were imposed, he would next consider how they were met. The whole of those disbursements had to be paid in gold, and that gold could only be obtained either by loans in England, or by remittances from or bills upon India. The capital of the railway guaranteed, companies was practically a loan raised for the construction of railways in India,

  997
  and the whole of that capital, amounting to £96,000,000, was paid to the credit of the Secretary of State in London; and the Secretary of State undertook to place to the credit of the companies such sums as remained over and above the payments made in England for stores and other purposes on behalf of the companies. Instead, therefore, of requiring the Indian Government to send home the sums necessary to meet the whole of the annual disbursements of the Home Treasury, the guaranteed capital was retained here and utilized in payment of the home charges, while the Indian Government placed to the credit of the companies in India the money which they would otherwise have had to send home to meet the expenses of the Home Government. And here he would mention an incident which illustrated the immense difficulties, arising from the peculiar connection between the two countries, which those who administered Indian finance had daily to meet. In the contracts made with the railway companies 1s. 10 d. was estimated to be the value of a rupee. Shortly after these contracts were made the American Civil War broke out. There was then an immense demand for Indian cotton. The rupee rose in value to 1s. 11 d., and even to 2s. For years they placed to the credit of the railway companies in India a rupee worth 2s. for every 1s. 10 d. paid here. If they lost thus on the capital account they consoled themselves by reflecting on their probable gains on the revenue account, as for every rupee paid into the hands of the Government in India only 1s. 10 d. was paid in London. But the demonetization of silver in Germany had depreciated silver to below 1s. 10 d. the rupee, and now that they were paying the full interest upon the capital, they lost as much on the revenue account as they lost on the capital account. Yet the original arrangement was fair to India; but two unforeseen events which no one could have anticipated had impaired the otherwise advantageous bargain. In the same way all loans raised except during the Mutiny were retained here and utilized in payment of the annual disbursements of the India Office. During the whole time that these loans were being raised a two-fold process was going on. The productive power of India was becoming enormously developed by the annual
  998
  expenditure of large sums upon reproductive works, while on the other hand India did not feel the counteracting effect of the increase of the disbursements in this country, which increase was mainly caused by the interest due upon the sums so expended.
  The guaranteed system having come to an end in consequence of its costliness, little capital on this account had recently been paid into the hands of the Secretary of State. When Lord Salisbury came into office he at once perceived the unwisdom of raising fresh loans in England for railways in India, and thus, owing to the abolition of the old policy of borrowing here, the full annual disbursements in this country had to be met by bills upon India. Now, how did India pay these bills, which might not unfairly be called an annual tribute from India? She paid for them by the excess of the value of her exports over her imports, and the price at which the Secretary of State's bills could be sold in London largely depended upon the condition and prosperity of Indian trade. Now, the Secretary of State's bills were payable in India in silver, and they competed with silver in the London market. If a merchant could not buy our bills he purchased silver, and vice versâ. During the last 20 years the balance of trade had been largely in favour of India, and she received the excess value of her exports over imports in bullion, minus the amount of the bills of the Secretary of State. The action of the Indian Government upon the demand for silver in India had been twofold. By the construction of railways and other useful works during the past 15 years the demand for and absorption of bullion had been largely fostered; on the other hand, the large annual remittances to England in order to pay for the interest so expended had, and especially during the last four years, since the full effect of the Home charges had been thrown upon India, largely diminished the amount of bullion otherwise due to India for the balance of trade in her favour. He was particularly anxious to impress this point upon the House, because if, on one hand, critics were disposed to point out the Home charges as the cause of the present depreciation of silver, on the other hand they could not deny that these same Home charges had during the last 20 years been the

  999
  main cause of the great development of the productive power of India, by which she had thus been enabled to acquire and retain enormous amounts of bullion.
  The amount of bullion retained by India during 40 years was remarkable, and especially so if they took the decades. The figures were as follow:—Surplus imports.—1835 to 1845.—Gold, £3,296,799; silver, £20,534,669; total, £23,831,468; Secretary of State's bills, £19,859,640; grand total, £43,691,108. 1845 to 1855.—Gold, £10,282,323; silver, £15,327,009; total, £25,609,402; Secretary of State's bills, £29,380,214; grand total, £54,989,616. 1855 to 1865.—Gold, £51,094,642; silver,£100,202,612; total, £151,297,254; Secretary of State's bills, £28,567,941; grand total, £179,865,195. 1865 to 1875.—Gold, £36,574,740; silver, £62,400,060; total, £98,974,800; Secretary of State's bills, £84,256,029; grand total, £183,230,829. This import of gold was curious, as little gold was in circulation. It must have been imported for hoarding or for ornaments. If such an immense amount of a precious metal, not used for coinage, was thus absorbed, they might infer that a large portion of the silver imported was retained for the same purposes, either in hoards or ornaments. India was able to acquire and absord this enormous amount of bullion from the growth of her export trade. In 1855–6 her exports were valued at £23,000,000, and the home charges at £5,000,000. In 1875–6 the exports were valued at £56,000,000, and the home charges at £15,000,000. This immense growth of the export trade, though partly due to other causes, was to a great extent the result of the growth of railways and other reproductive works. But the increase of the home charges was mainly due to the construction of these works; in other words, the growth of the purchasing power of India was the result of the increased expenditure in England.
  But there were other influences quite as potent, though not so apparent as Secretary of State's bills, in counteracting the Indian demand for silver—namely, the remittances from India to England made either by private individuals or on behalf of companies, the capital of which had been raised in England and invested in India. What the amount of these annual remittances might be it was difficult to estimate, but the amount was
  1000
  very large, owing to the increase of English capital invested in India, as well as of the number of Europeans residing in India; and this brought him to the real difficulty of our connection with India. India was not a country in which Europeans would settle or reside permanently. Yet she required certain things which she could alone obtain in Europe. She wanted European capital, Europe an enterprize and energy to manage that capital, while the infusion of the European element into her civil and military administration was essential for all purposes of good government. But when she had got these essentials she could not permanently retain them, for by a natural attraction the European, after a certain number of years' work, returned to his native home, carrying with him, if a private individual, the fortune he had made, or, if in Government service, the pension to which he was entitled. Thus there was a perennial drain upon the resources of India, which must, he was afraid, continue as long as the constitution of the European and the climate of India remained as they were. This was the main cause of the so-called home charges and of the heavy private remittances from India; and those who ignored this inherent drawback, arising from the peculiarity of the relations between the two countries, would never understand the main difficulty of Indian administration and finance.
  The guarantee system by which railroads had mainly been constructed had been often attacked. But it was the only method at the time by which the East India Company could push the construction of railroads, and if it had not been adopted one of two things would have happened—India would have been without railways or private companies would have constructed them. The interest upon the capital of a private and unguaranteed company would have been higher than the 5 per cent which was guaranteed by Government. Thus India would have had ultimately to send home larger sums for her railways than she now did. If, however, the capital expended on all these railways and works could have been raised in India, she would have derived nothing but unmixed good from their construction. This was precisely what England was now doing. The further development of Indian trade would be unchecked by

  1001
  the influences to which he had alluded, and on which, the Select Committee in their Report justly laid so much emphasis. The Select Committee gave so full an account of the causes that he would not stop to enumerate them, but would pass on to describe the effect of the fall of silver as shown in the exchange by the prices tendered for our bills this year. There was a rough-and-ready way of calculating the fall of silver by taking a rupee at 2s., or, in other words, 24 pence or 96 farthings. Every fall, therefore, of a farthing in the value of a rupee was a depreciation of about 1 per cent. The Government sold every fortnight £700,000 worth of bills. On January 19 they obtained the full amount at considerably above 1s. 9d. the rupee. On February 2, a fortnight afterwards, their tenders were much lower both in amount and price, and they continued steadily to fall through the months of February, March, April, and May; but they could not ascertain that any fresh causes, except a certain depression of trade, had come into operation, sufficient to account for this rapid depreciation. They therefore had reason to believe this sudden fall to be due to panic. By panic he meant an excessive apprehension of certain impending influences and causes, which, though in existence, had not yet begun practically to operate. They were in a position of great difficulty. On the other hand they were reluctant to reduce the price of their bills, because they knew that such a course would increase the panic; on the other hand, they did not want to raise a loan—their only alternative if they did not sell their bills. They therefore determined only to accept low prices for their bills, when the amount tendered was large, being confident that every fall, in the then state of the market, would only lead to further depreciation in subsequent offers. They refused to sell any bills during February and March, the tenders being low in price and still lower in amount, and they reduced the amount of their allotments during April and May. To meet the deficiency so caused they raised a loan of £4,000,000, which they obtained at a considerable premium.
  During the earlier months of the year they were in considerable perplexity at the India Office, not having before them the facts which were now
  1002
  known to the public through the Report of the Select Committee. They were therefore obliged to act upon impressions, and although borrowing in this country was, he admitted, wrong in principle, yet the facts which had since come into their possession seemed to him to be a conclusive justification of their action. The balance of trade being in favour of India, she received this balance in bullion, minus the amount of the bills of the Secretary of State. They sold £5,500,000 less from February to July than they did in last year. Therefore, unless there had been a great falling-off in Indian trade, £5,500,000 more bullion than was imported to India last year should have been remitted to India this year. There was a slight increase, but nothing approaching this amount. They made inquiries into the import and export trade of India, and found that during these months there had been a cessation of the annual increase of the last few years, but no general falling-off, except in the export of raw cotton. They then looked at the amounts tendered for their fortnightly drawings this year as compared with last year, and found that the contrast was extraordinary. In February and March 1875 tenders to the amount of £25,000,000 were received, during the same period in 1876 only £2,750,000. When there was demand for remittances to India the banks often tendered more than they wanted, in order to get a proportion of the allotment. Some allowance must be made for this in drawing comparisons between the two years. But, startling as was the falling-off in amount, the fall in price was even more curious. In January the rupee was 1s. 9¼d.; on July 5, a period of less than six months, it was 1s. 6½d., being a fall of 11 per cent; on Thursday last, less than a month from July 5, the rupee was sold at 1s. 7⅝d., being a rise, of 4½ per cent; and yesterday they sold a small amount of bills at 1s. 8¼d., being a rise of 7 per cent in a month. Yet during this period no fresh influences were brought to bear upon the silver market. The American production had not affected Europe, the imports of silver to England being considerably less during the last 12 months than during preceding years, while the actual amount of silver bullion in London was so small that on several occasions demands had to be supplied from abroad. These ex-

  1003
  traordinary fluctuations could not but be the result of a panic, especially as the price of Indian produce had not risen, and as he knew that in more than one instance the margin between the sold price of the rupee in London and its purchasing power in India enabled merchants buying Indian produce to realize a handsome profit. Although the raising of a loan would hereafter increase home expenditure, yet, recollecting that the whole of Indian trade was influenced by any action which the Home Government might take, and consequently the Customs revenue as well as the railway receipts, they did not feel justified in forcing down the exchanges in a panic-struck market.
  The exchanges between England and India were upon a different footing from the exchanges between England and any other country. During times of depressed trade, if little business was done, the amount of the indebtedness of the two transacting countries remained practically unchanged and the exchange rested in statu quo. But they drew every fortnight for the amount of £700,000 upon India, and unless there was some counteracting business done in India, the sale of their bills must unduly force down the exchange against India. The depression of Indian trade due to natural causes became, through fear of German silver, nothing less than paralysis during the last few months. They did not feel justified in maintaining this paralysis. The withdrawal of their bills had already had a most salutary effect. Merchants and traders had plucked up courage, and, as the purchasing power of the rupee in India had never fallen to the London quotation, a great stimulus would be given to the export trade from India, which could not fail to raise the price of silver and enable them more easily to obtain the sums necessary for the remaining payments of the year. Finding that prices had not risen in India, and that the export trade would, therefore, be stimulated, they had requested the Viceroy to endeavour to advance bills upon Indian produce, as an easier mode of remittance. Whether the Indian Government would be able to carry out this suggestion he could not say, but the subject was under their consideration, at the present moment.
  1004
  The Government had been severely blamed for not taking the market rate of the price of silver. But would any one contend that in daily fluctuations as sudden as he had shown them to be the market price could fairly be ascertained? Owing to the very peculiar circumstances of the year, for months it was not the price of silver which regulated their bills, but their bills which regulated the price of silver. Who were the critics who awarded blame? They were persons interested in remitting to India. The banks doing exchange business with India were their great customers. They were a mutual convenience one to the other; but in one point their interests were antagonistic. The Government wanted to sell their bills at as high a rate as they could; the banks wanted to buy them at as low a rate as possible. If, therefore, they had been blamed, it was by those who, failing to buy rupees at the rate they wished, were forced to employ some other form of remittance less advantageous to themselves.
  Perhaps the most curious feature in the whole of these operations was the small supply of silver in London. Any demand for silver raised the price, as the supply had on several occasions to be obtained from abroad. It was suggested, also, that they should fix a minimum for their bills during a certain period. But such an arrangement would have been most unfair to the Indian Government, for the only result would have been a tendency to make all tenders shave the minimum, and if, owing to any fluctuation, silver had fallen below that minimum, they would have been left without customers. The loss upon exchange was estimated to be£2,300,000. During the earlier months they realized rupees at a rate rather above that estimated. During the last two months the rate had been considerably lower. On the other hand, the loan was in excess of the sum mentioned in the Budget, and the Government would therefore draw for less during the financial year. It was impossible to estimate with perfect accuracy what the loss by exchange would be, as it depended upon the individual drawings, and silver might fluctuate as unaccountably during the remainder of the year as it did during the earlier part. He estimated that they might lose £2,800,000, or about £500,000 more than was estimated. He did not,

  1005
  however, contemplate a deficit. Our surplus was estimated at £144,000. The interest on the loan raised here over and above the amount estimated in India would be counterbalanced by the rupee-paper which the Indian Government had brought. The Customs and Salt for the first four months of the year had fallen off, as might have been expected from the depressed condition of the import trade. That trade was reviving, and both these items of revenue would be resuscitated, for the whole of Bengal was supplied by salt from England. Unless, therefore, other items of the ordinary expenditure increased, we should have an excess of the estimate for loss by exchange amounting to£450,000, against a surplus of £144,000. The actual revenue of the last two years had been in each case nearly £1,500,000 over the estimate. We might rely, he thought, upon an increase of revenue of £300,000, which would cover the increased loss from exchange. It must be remembered, too, that a considerable portion of the loss was nominal, the rupee, which for convenience sake was taken at 2s., never having touched that figure since. Taking 1s. 10 d. as a fairer rate, and striking off £1,000,000 of our loss as a matter of account, we had an actual loss upon the revenues of India caused by the fall in silver of about £1,800,000. If we could meet this sudden strain without special provision, and yet incur no deficit, it could not be contended that Indian revenues were in an unsatisfactory state.
  Having thus described the action of the Indian Government, both in past years as well as in the present, he might not unreasonably be asked if we had any remedies to apply to the evil. If he replied that at present they did not propose any heroic remedies, the House would understand that they adopted this course, not because they did not sympathize with those who were suffering, or that they did not appreciate the gravity of the position or the vastness of the interests affected, but because every proposal had seemed to them, after careful examination, inclined rather to aggravate than to mitigate the evil. He would enumerate the chief suggestions. To stop coining rupees in India was one suggestion. Such an order would, by stopping one of the outlets, lower the price of silver in London, the chief
  1006
  market; and if it raised fictitiously the exchange value of the rupee, which he doubted, it would check the growth of the export trade, which, if left alone at this moment, must draw silver to India, and thus raise the price in London and elsewhere. A policy of raising loans in London had been advocated. Under certain circumstances it might be, as it was this year, justifiable to raise money here; but to broadly adopt a policy of borrowing in England would be madness.
  The great object of the Indian Government ought to be the restriction of their expenditure in England; but every pound raised in England drew in subsequent years two pounds from India. Let him take last year's transactions as an illustration. They wanted £2,500,000, which they raised in India. If they had borrowed this in England they should have reduced their drawing upon India for that year from £15,000,000 to £12,500,000. Assuming the loan to be raised at 4 per cent, and for 25 years, during the next 25 years the interest of £100,000 payable annually here was exactly £2,500,000; but then the principal was due—namely, £2,500,000. So that for a saving of £2,500,000 in one year they eventually would have to remit from India to England double that amount in subsequent years.
  Another advice suggested the conversion of the payment of their land revenue from silver to gold. If prices rose in India they would lose largely on their land revenue; but he did not despair of arriving at some arrangement equitable alike to the cultivator and owner, as well as to the Government, by which they might prevent much loss; but to request the payment in gold of a revenue hitherto paid in silver, without giving the payer the means of getting the gold, seemed to him a most unjust proceeding. Besides, if they made their debtors pay them in gold, how could they refuse the same method of payment to their creditors, the holders of their Debt, and their civil and military services? This proposal, if carried, in effect, would be both impolitic in its operations and futile in its results, and might therefore be summarily dismissed.
  Considerable pressure had been brought upon them to adopt a gold standard in India. He would speak with diffidence

  1007
  upon this proposal, but he certainly thought that some who advocated this change were not aware of the vastness of the transaction, or of the terrible consequences of one false move in a most difficult enterprize. In the first place, if any attempt were made in this direction, he doubted if they could ever retrace their steps, for the change of the standard of value in India involved such a demonetization of silver that that metal would be for ever discarded as a standard of value in Europe. Silver was depreciated now, but what would be the price of silver in London on the morning after it was known that the Indian Government intended to adopt a gold standard? If they entered into such an enterprize they would have crossed the Rubicon and burnt their boats behind them. Could they adopt a gold standard without having gold? It would be ridiculous for India to say to the world, "The value of my silver is much depreciated. I must therefore request you to take it as gold."
  There were, however, certain gentlemen, of whom Colonel Smith was a public exponent, who believed that a gold standard might be adopted in India without buying the gold, and the lever by which they proposed to attain this result was the supposed balance of trade in favour of India. Their argument was as follows:—According to the last returns there was a balance of trade during the last eight years of £17,000,000 sterling in favour of India. By adopting a gold standard they would make this balance payable, not as it was now, in silver, but in gold, and in this way they would obtain the necessary gold. Let him for a moment consider this proposition. If there was a balance of £17,000,000 sterling in favour of India, in the first place the balance was in rupees converted at 2s. the rupee. In the Report of the Committee special attention was called to this rate of conversion. In the second place, against the balance of trade they had the India Office drafts upon India, amounting to £15,000,000 sterling in gold, to which must be added all private remittances from India, amounting to several millions. He had, therefore, grave doubts as to the large reputed balance in favour of India after taking into account all these transactions. But if there were a balance of trade
  1008
  in favour of India it was due to the expansion of her export trade, and as the rise of prices in India had not corresponded to the fall of silver in London and elsewhere, the export trade was now greatly stimulated. The sole object in adopting a gold standard in India, without a gold currency, was to give the silver rupee a fictitious exchangeable value outside India, and if this was possible (which he doubted) the result would be to at once check and curtail the export trade of India. But this scheme being based entirely upon the excess of exports over imports, the first result of its adoption would be to check natural causes now operating in our favour, and so to destroy the foundation upon which the success of the scheme was based. But there was another objection. Was the bullion imported into India used entirely for coinage or currency purposes? It was well known that it was not. During 20 years £86,000,000 of gold was retained by India; yet gold was only coined in that country in infinitesimal quantities. This immense mass of bullion was either hoarded or converted into ornaments. What applied to gold was equally true of silver, and no change in the currency would affect the import of precious metals for conversion into ornaments. If, therefore, the adaption of a gold standard was scarcely practicable without gold, how were they to get the gold? How much would they want? The amount of silver in circulation in India was considerably over £100,000,000. How would they pay for the gold necessary to represent this sum? Could they keep it in the country if they got it? Above all, what would they fix as the relative price of silver to gold? Over and above all these considerations there was a complication peculiar to India. They could not alter the standard in a day—it was a process requiring years of time. Meanwhile, how would they pay the Home charges? It was a gold liability, and India had only silver assets to meet it. Yet, by the action of the Indian Government itself the relative value of the two metals was changed—the value of gold being enhanced and silver depreciated, or, in other words, during the whole period of the process the annual liabilities of the Indian Government by their own action were being increased at the same time that their assets were being diminished.

  1009
  He hoped that it was understood that in raising these objections he in no way pronounced that a gold standard in India was impossible. He was merely pointing out some of the many difficulties which they should encounter, and the great necessity for caution. Any mistake in a transaction so gigantic would produce a catastrophe which would bring Indian trade into permanent and perhaps irremediable difficulty. No Government—least of all, the Government of a great and mercantile country—could embark in such an enterprise until they could confidently overcome their primary objections; and any Government who to win a temporary applause by the adoption of an heroic policy incurred such risks would be entitled to eternal censure. He did not attempt in any way to predict the future of silver. He would leave that to others; for so much depended upon the course of trade and the legislative action of nations that prophecy would be dangerous. Two things, however, should be borne in mind. The recent fall in silver was due not to increased production, but to the diminished use made of it in Europe. On the other hand, silver was the standard of value in the East and in countries such as China, where the demand for a metallic currency was practically unlimited, and was only controlled by the expansion or depression of trade.
  He had endeavoured to place fairly before the House the present condition of our finances, and he would recapitulate in a few sentences what, he was afraid at tedious length, he had already said. The Revenue had for the past 10 years steadily—and for the last two years rapidly—increased. The ordinary expenditure, excluding the loss by exchange, had not been so progressive, and by a rigid economy they hoped to arrest its further progress. The public works extraordinary were now conducted under more favourable conditions and more rigid scrutiny, and the impetus given to Indian trade by their advancement would not be trammelled by increased payments here. Under the unprecedented loss caused this year by the fall in silver, he did not contemplate a deficit unless the opium advances were much in excess of the estimate; but any excess in opium advances this year meant an increased opium revenue next year.
  1010
  He did not disguise from the House that it was a great mortification to the Government that at the very time when the expansion of the Indian Revenue afforded opportunities for placing the fiscal system of India upon a sounder basis they were checked by influences which they could not control and for which they could not be held responsible. If upon this all-important subject he was not able to adopt any of the remedies suggested, he could at least promise that it should continue to absorb the attention of the Government, that their communications with India would be constant, and that if the opportunity occurred of making any beneficial proposal at home or abroad, they would not shrink from their responsibilities or hesitate to use their powers; for they felt sure that in this, as well as in every similar discussion, they might rely upon the advice and aid of Parliament in assisting them to unravel a complicated problem, upon a correct solution of which would mainly depend the future trade, finance, and prosperity of a vast and integral part of the Empire.
  Motion made, and Question proposed, "That Mr. Speaker do now leave the Chair."
  MR. FAWCETT,who rose to move the following Resolution:—
  "This House views with apprehension the constant additions which are made to the Debt of India, and is of opinion that, considering the serious loss that has been caused, and may continue to be caused to India, by the depreciation in the value of silver, no new public works should be undertaken which would necessitate the raising of fresh loans; and that in order to place the finances of India on a more satisfactory basis, the distinction which is now made between ordinary and extraordinary expenditure should be discontinued,"
  said, in the first place that Indian finances were in a position of greater gravity than they had ever before occupied; and, secondly, that nothing was more unfortunate than to raise great expectations and then to shatter them. He had been much struck by the remarkable contrast between the beginning and the end of the noble Lord's speech. The first part of his speech reminded him of the time when the Under Secretary in the late Government presented everything in roseate hues—a growing revenue, a satisfactory state of the expenditure, remunerative public

  1011
  works, everything going on prosperously; but after parading all this the noble Lord changed his tone, and told them that a crisis of unequalled gravity had come upon India, and to make both ends meet the Government had been obliged to borrow £4,000,000. The surpluses which were relied upon with so much confidence were purely fictitious. They only existed through the vicious way in which the Indian accounts were kept. The real way of stating the financial position of India was that her Debt was increasing at the rate of £3,000,000a-year, and the interest of that Debt was increasing at the rate of £130,000 a-year. During the last three years the aggregate deficit was not less than £10,500,000. That would continue so long as they kept up the delusion of ordinary and extraordinary expenditure. Sir William Muir, in his Budget statement last March, said the depreciation of silver was casting a grave shadow over the future, and this was the most serious danger that ever threatened the finance of India. The question of the depreciation of silver as it affected the financial position of India might be regarded first as a decline in the value of silver compared with gold, and next as a decline in the purchasing power of silver in India. Next, he might consider the causes which had brought about this depreciation, and whether it was likely to continue to diminish or to increase. Thirdly, he would consider some of the remedies which had been proposed for correcting the mischief which the depreciation of silver was producing; and, fourthly, if no reliance could be placed on any of these, then came the practical question—what was the financial policy which the Government ought to adopt? It was not necessary to enlarge on the first point after what the Under Secretary had said as to the effect which the depreciation of silver exercised on Indian finance. There were three modes of meeting a deficit—borrowing, additional taxation, and increased retrenchment. Government had adopted the first of these, which was simply a desperate expedient. The deficit next year would not be less, but greater, because the interest on the loan would have to be provided for, so that the deficit would accumulate on the principle of compound interest. The term "depreciation of silver" was employed in two different
  1012
  senses—a depreciation as compared with the value of gold and with its purchasing power in India. He agreed that the depreciation of silver had been simply a gold depreciation; it had not been accompanied to a marked extent by a decline in purchasing power or a rise in general prices in India. The practical question was, could this state of things continue? If it could not, what would be the position of the Indian Government when there was a falling off in purchasing power and a rise in prices? As things were, it became profitable to purchase silver and send it to India; and the effect of that would be an increase in the Indian export trade, and a decline in its import trade; indeed, those effects were already beginning to manifest themselves, and the consequence would be, as Sir William Muir estimated, it would require £3,000,000 more to adjust the balance of trade. The increased cost of materials and the advance of wages would increase the cost of administration. A considerable portion of the Revenue was a fixed amount of silver; there was heavy loss on the £15,000,000 of Home Charges; and the loss to residents in India in sending remittances home for their families would be equivalent to an income tax of 20 per cent on the amount remitted. There would therefore be disturbance in trade and dislocation of commercial relations. The depreciation of silver was not the result of panic; and the chief difficulty was to explain how it was that the fall had not been much greater, seeing that the supply had been doubled in four years, and that the increased supply had been accompanied by a falling demand. He bore testimony to the ability and fairness with which his right hon. Friend (Mr. Goschen) had presided over the Committee, and he argued that the value of silver was determined by the same laws as the value of wheat or coal, or any other commodity. He agreed that nothing could be more hazardous than to make predictions about the future value of silver. The causes of the depreciation were the discovery of mines of extraordinary richness in America, which had increased the yield from £7,000,000 or £8,000,000 to £14,000,000 or £15,000,000 a-year, simultaneously with the demonetization of silver in Germany and Holland, and a restricted use of it in other countries. The most potent cause of

  1013
  the depreciation was that for 11 years before 1871, India, on an average, absorbed £16,000,000 sterling of silver every year; whereas during the last four years the average absorption had been little more than £3,500,000 worth. For some years the absorption by India was equivalent to twice as much silver as all the silver mines annually produced, and now it was only half the yield from one source of supply, the silver mines of the United States. There were many circumstances which might favourably affect the value of silver, while, on the other hand, it must be borne in mind that some persons affirmed that the silver mines of America were only in the infancy of their development. It would also be unwise to conclude that France would go on purchasing silver to the same extent as during the last three years. Without hazarding a prediction as to the future, the Indian Government would be rash in concluding that this fall in silver was the result of a panic. Coming next to the remedies that might be proposed, he would remark that no part of the noble Lord's speech had given him more satisfaction than the assurance that the Indian Government were going to be firm against the propounders of currenc nostrums. Nothing could be clearer than the unadvisability of introducing a gold currency into India. That country must be too poor for a gold currency, of which it had been said by an Indian official before the Indian Finance Committee, that thousands of the people of Bengal had never had even the smallest silver coin in their possession. An opinion was held in certain high quarters that, although it would be unwise to introduce a gold currency into India, you might have a gold standard. This, however, would be a breach of faith, and would be objectionable on several grounds. Another recommendation was that the price of silver should be kept up by restricting the coinage of rupees. This would, however, bring about a real panic in silver. It might be asked what ought to be the financial policy of the Indian Government with a view to meet the loss which had been measured at £2,500,000 a-year. It could only be met in one of three ways—by loan, by additional taxation, or by rigid retrenchment. With respect to borrowing, that was only postponing the evil day, for the loan must
  1014
  be paid off, and meanwhile the interest would be an additional burden on the taxpayers. Additional taxation could only be effected by having recourse to that which had been well called, "the financial reserve of India"—namely, the income tax. The income tax in India had for political reasons been abandoned as unsuited to the country, and even if it could be resorted to, while a trifle over 1d. in the pound would be sufficient to meet a deficit of £2,500,000 in England, in India it would require 1s. in the pound to do so. The only remedy was to be found in rigid retrenchment; and how was economy to be effected? The noble Lord had spoken of the finances of India as being in a thriving condition. He regretted he could not so regard them, the annual increase in revenue from all sources amounting to £100,000 only. In fact, the financial position of India might thus be described—a very slowly-increasing revenue, a steadily-increasing expenditure, a rapidly increasing Debt—which had doubled itself in 18 years—and every year a large deficit arising from the expenditure on what were called reproductive works, but which, he ventured to assert, did not pay the interest of the money expended upon them. It seemed to him that the first necessity of the situation was to get rid of that distinction, which did nothing but confuse—the system of dividing the expenditure into ordinary and extraordinary. Many of the reproductive works were not likely to return interest upon the expenditure. The accounts of their future works were in such a condition that they might hand them over to the most experienced man and he would be puzzled to say whether or not there was a reproductive return. As to the reproductive ness of many of these works he might observe that on the State railways the net return was. £118,000, though the expenditure on them was £14,500,000. Many of them had been constructed for stategical purposes, were military roads in fact, and could not possibly be of advantage to the trading community, and scarcely returned any interest upon money which had been borrowed for their construction at 4 per cent. Again, of all the irrigation works we had undertaken, he defied the noble Lord to put his finger on one which he could say had

  1015
  proved a financial success. The country had been told that the Orissa Irrigation Works would yield a return of 16 per cent. Government accordingly bought them, paying for them £1,500,000. The revenue last year amounted to only £4,000, and yet the working expenses amounted to £22,000, or a loss of £18,000. The Madras Works were equally profitless. The old Water Works at the Jumna, however, built by Akbar, were paying 35 per cent, and the revenue from them was thrown into the General Irrigation hodge-podge, and thus mitigated the loss. Did the Under Secretary for India forget what Lord Salisbury said on the subject last year, when he asserted that with regard to irrigation works there was not among those constructed by the English one instance of a genuine financial success? Was it possible for them to come to any other conclusion than that, however desirable railways and canals in India might be, no certainty could be arrived at that they would meet the expenses involved. One of the first things which ought to be done in the way of retrenchment to meet the loss consequent on the depreciation of silver, was that they should decide that for the present no new public works should be constructed which would involve the raising of fresh loans. It was a radical defect in the financial arrangements of India that, instead of going into the open market when it was necessary to procure the services of engineers, a costly Government educational establishment was kept up at Cooper's Hill, and a number of engineers, for whom it was necessary in some way to provide, were from time to time sent out to India. If the Army expenditure went on increasing at the present rate, the Government, although they were the proprietors of almost all the land of India, would soon be obliged to expend almost all the land revenue upon Army charges. Again, the present administration of Bombay was a marvel of extravagance. Vast sums of money were recklessly spent. There was no reason why the cost of administration at Bombay or Madras should be greater than in the North-West Provinces. The time had come for getting rid of the sort of semi-State which was observed at Bombay and Madras. More resort should be had to Native agency, which was less expensive than
  1016
  European agency. Natives had shown that they possessed political capacity, as was shown in the case of Sir Salar Jung. It was a sorrowful reflection connected with our rule in India that somehow we seemed to have crushed out Native capacity, especially in utilizing the resources of nature. A young English engineer might understand engineering theoretically and might be well acquainted with mathematics, but what was wanted in India was acquaintance with local peculiarities and necessities. Between the Chenab and the Sutlej, where rain hardly ever fell, by means of irrigation works constructed by Natives this district was once turned into a paradise of plenty. Now if the Natives had shown such capacity in the past, why should not their services be utilized in these days? This was a question of great political as well as financial importance. In making these remarks he fully appreciated the difficulty of the question with which the noble Lord had had to deal. Despite present unfavourable appearances he looked forward with no little hope to the future. He believed that India would in the future obtain abundant recompense for the loss brought upon her by the depreciation of silver, if it should enforce on those responsible for her government the lessons of economy which had hitherto been too much neglected. There was nothing in the administration of Lord Salisbury he so much regretted as the speech he delivered on the repeal of the Indian import duties. However great the theoretical arguments against those duties, there were others, such as the salt duty and the stamp duty, which pressed more severely on India, and he could not help thinking that a pledge somewhat carelessly given to repeal the import duties was likely under the circumstances to produce discontent. He thanked the House for the patient hearing they had given to the remarks he had made. In making them he had no other object in view but to do what little he could to strengthen the hands of the Government in contending with the difficulties they had now to encounter in the financial administration of India. If they had the courage to face those difficulties, carrying out the most rigid economy, they on that side of the House would not be so unpatriotic as to turn those difficulties to any Party advantage, but

  1017
  would do all in their power cordially and loyally to restore stability and equilibrium to the finances of India, and bring greater contentment to the people of that great country. The hon. Gentleman concluded by moving his Resolution.
  Amendment proposed,
  To leave out from the word "That" to the end of the Question, in order to add the words "this House views with apprehension the constant additions which are made to the debt of India, and is of opinion that, considering the serious loss that has been caused, and may continue to be caused to India, by the depreciation in the value of silver, no new public works should be undertaken which would necessitate the raising of fresh loans; and that, in order to place the finances of India on a more satisfactory basis, the distinction which is now made between ordinary and extraordinary expenditure should be discontinued,"—(Mr. Fawcett,)
  —instead thereof.
  Question proposed, "That the words proposed to be left out stand part of the Question."
  MR. SIDEBOTTOM: Sir, I do not often trouble the House with any observations, but as an extensive English cotton manufacturer, and as having the honour to represent a large and important manufacturing constituency, I have placed a Notice on the Paper relative to the import duties levied in India upon cotton goods, in the hope that—though I am aware it cannot be moved as a formal Amendment—it may have the effect of raising some discussion on this important subject, as I think it is most desirable that, before we separate for the Recess, it should be made clearly known that the present system of Protection prevailing in India, as exemplified by these duties, is condemned alike by this House and by enlightened public opinion throughout the country, for it appears to me difficult to determine whether that system of Protection ought to be more condemned in the interest of this country or of India itself. Now, the amount of this duty is 5 per cent, and we contend that it raises the price of cotton goods throughout India, that it seriously handicaps English manufacturers, and greatly hinders our trade with that country, and that it fosters and encourages the rise of mills in India to an undue extent. Some hon. Members may perhaps consider that 5 per cent is not after all such a very heavy duty, and that it cannot really make so
  1018
  much difference whether it is repealed or not; but we must remember that the disadvantage to the English manufacturer is not 5 per cent on his profits—if profits he is ever to know again—but 5 per cent on his whole turnover, and if English manufacturers could be insured 5 per cent profit on their turnover by consenting to give up the chance of anything more I, for one, would gladly accede to any such arrangement, and I think most other English manufacturers would willingly do the same. Well, after the very able despatches of the noble Marquess the Secretary of State for India, which have been laid on the Table of this House, and which I hold in my hand, I feel that little can indeed be added to the masterly arguments he has brought forward and the very strong case he has presented in favour of the repeal of these duties; and it would be an easy task to maintain the propositions I have enunciated by reading from these despatches and the statistics adduced. They have, however, now for some time been in the hands of hon. Members, and have, I hope, already been carefully and attentively read by all who take an interest in this subject and it is therefore unnecessary to recapitulate at length what the House is already probably sufficiently familiar with. It has been said that we do not hold India for the benefit of English cotton manufacturers, and that therefore we ought to approach the consideration of this subject from an Indian point of view exclusively. Well, granting that for a moment for the sake of argument, these duties appear to me utterly indefensible even on that ground. They undoubtedly raise the price of their principal article of clothing to the Native population of India, and are, in short, taxing the many for the benefit of the few. It has also been said that the people of India wish these duties to be retained. But what proof have we of this? Who are the people of India? Do they consist, I should like to know, merely of the eight Government officials who voted at Simla in favour of the present Tariff Bill. If it had been possible to consult the great body of the Indian consumers, would the Tariff Bill have been passed with their consent? I venture to think that the consumers of India are quite sufficiently acute and quite sufficiently alive to their own in-

  1019
  tersest as to have given no consent to the passing of that measure, or of thus perpetuating a tax upon their chief article of clothing, and yet the consumers of India have surely as much right to be considered the people of India as the official gentlemen who voted at Simla or the mill owners of Bombay. As has been stated by the Manchester Chamber of Commerce, and quoted by the noble Marquess (the Marquess of Salisbury) in his eloquent despatch—
  "This duty is maintained at the expense of the consumers principally, the poorer class, against whom it tells with particular hardship in a prime necessary, such as clothing,"
  and although presiding as they do over the destinies of that great Empire, it is doubtless the duty of the British Government to promote, by every legitimate means, the material interests of India. It cannot surely be their duty to permit the many to be taxed for the benefit of the few, or to aid a few British and other capitalists in amassing enormous fortunes by developing the cotton manufactures of India to the exclusion and injury of those of England herself. But I go further than this, and maintain that in considering the question of retaining or repealing those duties, their effect upon the manufacturing trade of this country ought also to betaken into account. They are directly contrary to the principles of Free Trade, and have a most powerful tendency to foster the rise of cotton mills—both spinning and manufacturing—in India to the great detriment and loss of English manufacturers and the serious injury of English workpeople and operatives, and this is indeed a most important consideration. The great cotton industry has from £125,000,000 to £130,000,000 of capital invested in it, it affords direct employment to about 500,000 operatives, and it is estimated by the last Census that there are altogether no fewer than 2,000,000 of people dependent upon it; and these operatives are far more immediately and far more seriously interested in the repeal of these duties than even the employers, because, although a large amount of capital is leaving England for the purpose of establishing mills in India the workpeople cannot follow the capital. Their labour is their only capital, and in the prospect of a stoppage of mills in England they see nothing but
  1020
  ruin, distress, and misery before them. Nor will the House, I think, be of opinion that these apprehensions are destitute of foundation when it is remembered that in the year 1859, before the high duty was imposed, there were only three cotton mills in Bombay, whilst there are now upwards of 40; that in the year 1870 the value of English machinery imported into India was £304,000, but last year the value was £1,545,000. And English machinery being allowed to enter India thus freely without duty, it certainly seems but scant justice for our competitors in that country, after availing themselves to the utmost of the advantages thus afforded, to repay us by placing a heavy protective duty on our goods; and if the exigencies of the Indian Exchequer really do imperatively demand that a tax should be imposed on some article of British production, it appears to me far more reasonable, far more just, and far more in accordance with the dictates of common sense that such a tax should be placed upon English machinery rather than upon English cotton goods. But I confess that I utterly fail to see by what process of reasoning or logic ardent supporters of a policy of Free Trade here at home can at the same time advocate one of obsolete Protection in India. As has been well said by a high authority on this subject, Colonel Raynsford Jackson—
  "So far as the progress of cotton manufactures of India is aided by the natural advantages of that country, by cheap cotton, cheap labour, and markets close at hand, we are quite prepared to lose that portion of our trade, but we do object to having it torn from us by the aid of our own Government and by protective duties."
  These are wise words, well worthy the attentive consideration of the House. We English manufacturers ask for nothing but a fair field and no favour, and surely we are already sufficiently handicapped. Consider the enormous distances our goods have to traverse to reach the markets of India. We have to bring the raw cotton (I am, of course, now speaking of Indian or Surat cotton) all the way from India to England, manufacture it here in England, then convey it back again to India, paying all the charges, and enormous cost of transit both ways, wages here in England are eight or ten times as much as they are in India, and what is a most important element in the cost, of far

  1021
  more importance probably than hon. Gentlemen not conversant with the trade can readily comprehend—there is practically no restriction on the hours of labour there. Accordingly we find that we have already lost our trade with India in the coarser goods, which can be sold cheaper by native manufacturers and under the fostering, but in the long run baneful and deleterious, influence of these protective tariffs; in the fine goods also the Indian mills are now fast threatening to deprive us of our trade with that country. It appears to me most monstrous and unjust that in addition to the natural disadvantages with which we have to contend, we should have Indian mills assisted, and English mills injured by a heavy protective duty being placed upon English goods before they are allowed to enter the country. Some sense, indeed, of this injustice, appears to have made itself manifest to the Government of India, and to have caused them to place a duty of 5 per cent upon cotton not the produce of India, but a more illusory system of compensation could not be conceived. It could under no circumstances amount to more than about half the same duty placed upon goods which are of course much more valuable than the raw cotton out of which they are made, the whole cost of their manufacture being included, but the arguments by which it is supported are based altogether on false premises—upon the assumption that the medium and finer class of goods cannot be made wholly or in part out of Indian cotton, whilst as was truly stated by the deputation to the noble Marquess (the Marquess of Salisbury) and quoted by his Lordship in his despatches—
  "The whole of the medium goods which comprise the trade in shirtings can be made of Indian raw cotton, with or without the admixture of the imported material," and "there is nothing to prevent the gradual substitution of Indian for British manufactures in a trade which constitutes nearly two-thirds of the total exports from England to India."
  It is indeed a most significant fact that whilst, owing to the general prosperity of the country, to the great increase of wages, to the enormous development of railways, and other causes, the value of goods imported into Calcutta, where they are not so much exposed to the competition of the native mills, has in 14 years increased 77 per cent, the corresponding
  1022
  advance in Bombay has been only 12 per cent; whilst in the coarser goods, comparing the years 1872, 1873, and 1874 with the three years before the American War there has actually been a decrease of more than half the figures, being in the proportion to 15 to 7. These facts, I think, speak volumes; but we have been told by those whose high position and exalted rank lends an importance to their statements, which they would not otherwise command, that the request for the repeal of these duties is all a "Manchester delusion." Well, many charges have been made against Manchester men and the class to which I belong, but of all the charges—open or covert, expressed direct, or implied—which have ever been made, this is what I should have least expected. Hitherto we have, generally, at least, been credited with a tolerably clear perception of our own interests, and if those who made this charge had seen the large and most influential deputation of employers and employed combined, representing nearly the whole cotton industry of Lancashire and the neighbouring counties, which waited on the Secretary of State for India in reference to this subject a short time ago, and witnessed the earnest, resolute, and the unanimous feeling which animated the members of that deputation, I think they would not have come to the conclusion that it was only "a Manchester delusion." But this is by no means the only charge which has been made against us. It has been said that we do not approach this question with clean hands, and in some cases even the word "fraudulent" has been made use of in reference to the heavy sizing of some description of goods for the Indian markets. Now, although a manufacturer, I am entirely without bias in this matter, because, though my family have been engaged in the cotton trade from its very infancy, for three generations neither my grandfather, my father, nor myself have, so far as I know, made goods for India at any time, being engaged in an entirely different branch of the trade. Now the practice of making these heavily-sized goods originated, I believe, during the American cotton famine, when manufacturers, driven to their wits' end, were fain to have recourse to well-nigh any expedient to supply the want of raw cotton. This class of goods, therefore, has been before

  1023
  the Indian consumers for 10 or 12years. The Indian consumers know their exact quality perfectly well, and also that they can at any time have the better article at a relative price. As a matter of fact, however, they do, I believe, in many instances prefer the heavily-sized goods at the cheaper price. Now it is a well-known axiom in trade, that "demand always begets supply," and now that the necessity of their manufacture has long since passed away, the demand for them is really the reason why they are still produced, so that it is simply puerile and absurd to attach any blame to English manufacturers on this score. I apprehend it must be admitted that it is the inherent and inalienable right of all Her Majesty's subjects to trade on equal terms throughout the whole of the dominions subject to the authority of the British Parliament, and that, therefore, these duties ought to be abolished at the earliest possible period, but it is urged that the exigencies of the Indian Exchequer are such that they cannot be repealed just as present. Well, I am not prepared to deny the cogency and the force of this argument. No doubt the Government of India is at the present moment labouring under exceptional difficulties owing to the great depreciation which has taken place in the value of silver, as, of course, this raises the cost of all payments which have to be made to England in gold, but it must not be forgotten that great as may be the loss to the Government of India the loss to British manufacturers and British merchants is also great; transactions which seemed to afford a fair chance of a profitable return, but too often resulting in ruinous loss in consequence, so that this decline in the value of silver really at present constitutes another and most serious tax upon British goods. It certainly seems very hard that in consequence of this another tax should also be retained, but I speak with the very greatest diffidence on this question. It is a most complex and difficult subject, and the more it is considered the more difficult it appears. So far, however, as the trade in cotton goods is concerned, it is not perhaps likely to continue eventually to have the same disastrous effects as at present, because their price will be governed by the law of supply and demand, and will in the long run probably be adjusted and accommodated
  1024
  to the value of the currency in which payment is made. Well, many methods have been suggested for overcoming or at least mitigating this evil. One is by adopting a gold standard, and much can be said both for and against this plan. The Government of India have also themselves pointed out that their loss would be partly met if by borrowing money in England their remittances were reduced, and it is possible also that if a portion of the paper currency was gradually withdrawn and silver substituted, the demand for silver would be increased. It seems, however, very doubtful whether it is not wiser to leave such difficulties to be overcome by the operation of natural laws. But, however this may be, the Indian Revenue is shown to be still very expansive. It amounts at the present moment to about £50,000,000 sterling; and when we remember that in the year 1840 it was only about £20,000,000, and that in the year 1855, since which year there has been no accession of territory, its amount was only between £30,000,000 and £40,000,000, and that the amount raised by the import duties upon cotton goods is barely £800,000, I think the House will be of opinion that such alterations and retrenchments might at no very distant date be effected as would enable these duties to be eventually repealed. In the presence of the noble Lord who represents the India Office in this House (Lord George Hamilton), it would ill become me to suggest by what means or from what sources the Revenue ought to be raised. I do not wish to enter into the question as to whether the vast expenditure which has for a long time past been taking place has or has not been upon profitable undertakings, whether the rich Natives are or are not a very lightly-taxed class, or whether the income tax is or is not a suitable tax for India. Neither do I venture to suggest whether there ought to be a retrenchment of expenditure, or a change in the incidence of taxation; but I do venture most respectfully and most earnestly to urge upon the noble Lord and upon the House, and upon the country, that under no circumstances whatever ought any portion of the Revenue of India to be raised for one moment longer than can possibly be avoided by levying a tax upon British goods; that it is contrary to public policy and the best interests of the Em-

  1025
  pire so to raise it; and that, in fact, any method would be preferable to this. Besides, if England is bound to balance the Indian Budget, and make good any deficiency in the Revenue, surely the burden ought to be borne by the whole country, not by Lancashire alone, and it has, indeed, been often said that it would be less objectionable for Lancashire to pay the amount in hard cash than in the present most obnoxious form. We must remember, also, that these duties, if not repealed, may soon have an effect far wider, far more mischievous, and far more injurious, than even raising the price of clothing throughout India. They must affect most prejudicially the prospects of any overland trade with those countries of Central Asia which are not yet subject to the sway of Russia, where prohibitory tariffs are consequently not yet introduced, and the price of goods, therefore, is a serious element in the trade. But important as the question becomes from this point of view, important as it may be alike to the Indian consumer and the English manufacturer, I venture to think that there are far wider, broader, and far more important considerations still. It is eminently an Imperial question. Much of the prosperity, much of the wealth, and much of the greatness of this country, depends upon our unrivalled pre-eminence in commerce and in manufactures, and it will indeed be an evil day for England which witnesses any decline in either the one or the other. Well, one-third of the entire exports of the country consist of cotton goods, and one-fifth of those cotton goods goes to India, and if deprived of the Indian markets how can we replace them? Cotton manufacturing has of late years made such rapid strides on the Continent of Europe, that it seems probable less of our goods will soon be required there even than now. As an illustration of this I may, perhaps, be allowed to mention that the whole production of a large cotton concern then belonging to a branch of my family used to go almost exclusively to Russia, but by prohibitory duties Russia now endeavours to exclude all English goods and yarns, and there seems, indeed, to be a steady decline in our exports of cotton goods to all other countries except India; for in the year 1872 our exports to all countries except India amounted in the aggregate to £66,000,000, but
  1026
  last year only to about £55,000,000. Nor is this falling off wholly to be ascribed, though, no doubt, it is to some extent owing to the depreciation in value. So this is really a most serious question, which more or less concerns every individual and every class in this country. The great depression at present unhappily existing in well nigh every branch of industry and trade all over the country, affords, indeed, but too conspicuous an illustration of the evils which would be in store for the whole country if we were to suffer any permanent paralysis of our own trade. Great as would be our misfortunes, they would by no means fall upon our own heads alone, but would tell with disastrous and crushing effect upon well nigh every class and upon well nigh every interest in this Kingdom. The present position of the great cotton industry is not indeed at the present moment so bright that it can very well afford the imposition of unnecessary or artificial restrictions. Seldom has it been more gloomy. On all sides we hear of accumulation of stocks and absence of demand, and if, as seems but too probable, the prospect should become darker and more dark till it finally culminates in scarcity of employment, distress, and its inevitable accompaniment, increased pauperism and increased rates, I hope hon. Gentlemen who are opposed to the repeal of these duties will, at all events, do us the justice to remember the one prominent case of the depression in an industry upon which 2,000,000 of people depend for their daily bread has been pointed out during this discussion, and that in asking for the repeal of these duties we are asking for a fair field and no favour—not in the interests of Lancashire alone, but of the whole country, and of India itself.
  MR. BRIGGS: I hope, Sir, that the House will pardon me if I venture to address them for a few moments this evening. I claim the indulgence of hon. Members for two reasons—first, because I have not occupied much of their attention and their time this Session; and then, because those who have sent me here to Parliament hold the question which has now at length been brought before the notice of hon. Members to be to them of the greatest interest and importance. Indeed, Sir, did I wish to give an instance of the unjust incidence

  1027
  of this tax of 5 per cent, and to show what an onus it is upon our industry—what a restriction upon our enterprize—I could not do better than take as an example the district with which I am most familiar, and tell you that, within a circle of two miles from the centre of Blackburn, there are some 52,000 looms at work. Of these, 46,000 are engaged in the production of cloth for the Indian market; and the House will, I think, be startled when I tell them that last year no less a sum than £248,000 was paid by this small area to the Indian Exchequer. Sir, we have always protested against these duties. I admit at the outset that they were originally imposed for purposes of the Revenue only; but, at that time even, my hon. Friend the Member for Manchester (Sir Thomas Bazley), warned the House that these duties would in the end become protective in their nature. Sir, they have become protective, and from the moment they developed this protective element, our objections and our protestations assumed a more active and more offensive form; and so during the late Recess, and, indeed, for sometime before, an agitation was carried on against these duties, and meetings were held in order to find out a means of securing their abolition—an agitation not carried on by those who have been termed the selfish employers of labour, but by the employed—meetings called together not by greedy capitalists, but by those whose only capital was the labour they had to sell, and who, as the noble Lord opposite (Lord George Hamilton) was reminded by a deputation that waited upon him at the India Office, cannot follow that ever-increasing stream of gold which is being poured into that great Indian Dependency of ours for the purpose of nourishing a competing industry whose giant and exotic growth is springing up under the shadow of these protective duties. Sir, I attended several of those meetings, at the invitation of working men; and I wish that hon. Members of this House could have been there too, for, as they gazed upon the sea of serious upturned faces, and marked the eagerness, the closeness, the attention, with which they followed the observations, the arguments, the statistics of those who addressed them, hon. Members could not have failed to be convinced, a I myself
  1028
  was convinced, of the deep, I might almost say, painful interest which in Lancashire is taken in the question now before the House. No, Sir, painful is not too strong a word; for, looking at the gloomy prospects of the trade, and with the horrors of the Cotton Famine still fresh in his memory, can it be wondered at if your Lancashire operative indulges in a feeling of that kind? But I am sorry to add that some bitterness is beginning to be mingled with his thoughts when he reflects that these duties cannot, and never have been maintained, on the high grounds of fairness and justice, but that those who seek to retain them, whether from disinterested motives, like those of the hon. Member for Hackney (Mr. Fawcett), or from interested motives, like those of that small band of monopolists in India—who alone, I will venture to say, benefit by their retention—always base their claim to a non-abolition of these duties on the assertion that the machinery of Indian finance is of such a fragile and intricate character, that the balance of the Indian Budget is so delicately adjusted, that the loss of this £800,000 a-year, which it would be necessary to forego, would plunge the finances of India, and the financial proposals of the Government, into inextricable, unutterable, and chaotic confusion. Sir, I think that those who hold these views do the able financiers of India a wrong, for what do we see this very year? The Government of India is suddenly called upon to fill up a large gap in their finances. By the depreciation of silver they are subjected to a heavy loss; and here I might remark, si licet parva componere magnis, that Lancashire manufacturers suffer more in proportion than the Government does from the depreciation of silver. Well, how do they propose to meet the loss? Do they propose to place further taxation on the people of India? No, Sir, they propose to meet the loss by reducing their ordinary expenditure. This item "extraordinary expenditure," is a terrible weapon in the hands of an Indian Finance Minister; for, supposing that for any reason he dreads having a surplus, it is easy for him to propose to dig a canal, or carry out some public work of that kind. Sir, I find that, between the years 1867 and 1874, over £13,000,000 have been spent in this

  1029
  way; and it was proposed, originally, to spend about £4,000,000 this year—all this money charged to revenue and not to capital. The income of India in 1840 was £20,000,000, and that was sufficient to meet the expenditure, and yet £50,000,000 in 1875 is barely sufficient to meet the claims on the public purse. It appears to me that Indian financiers are on the horns of a dilemma; either India is a rich country, or India is a poor country. If she is a rich country, she can well afford to do without this £800,000 for which we ask; but, if she be poor, than the system of finance which at present exists is a bad one, and ought never to have been pursued. I will give one instance. We have had two famines; one in Ireland, and the other in India. The Irish famine was paid for by money borrowed and repaid by instalments; the Indian famine was paid for by money taken from current revenue; so that India, which is said to be poor, pursued a line of policy which great, rich England did not attempt to do. And now I leave the lofty regions of finance and come back to my cotton. I do not think it would be right to enter at length into the question of competition as between the Indian manufacturer and ourselves. That has been so admirably dealt with by the hon. Member who preceded me (Mr. Sidebottom), that I will not try the patience of the House by quartering the same ground again, and I will therefore pass by, merely mentioning some of the immunities and privileges which the Indian manufacturer enjoys over his English brother—such as, for instance, an untaxed income; immunity from Factory Acts; propinquity to the raw material out of which he manufactures his goods, and nearness to the market in which he sells them; and, last—this I commend especially to the notice of hon. Members—a happy indifference to the fall of silver, which, indeed, acts as a second protection to Indian manufacturers. And, Sir, I say that, when you are told that this Indian trade can increase some 50 per cent in one year, when you know that English competition in the coarse trade has been, driven out of the country, and that the extra amount of capital which now finds its way to India is attacking the medium class of goods, of which two-thirds of our exports to India consist, I think the House will see
  1030
  for themselves that the competition with India is a real and severe competition, and is not of that "bogus" character which I have heard denounced in this House. I would beg hon. Gentlemen to remember one or two things; first, that the so-called Indian millowner is in the majority of cases an Englishman, who finds in that country a more remunerative return for his capital outlay; second, that the presence of these protected mills do not cheapen by one farthing to the poor Hindoo the cotton goods, which to him are one of the necessaries of life; and I can assure noble Lords, in other places, that their presence in the country does not exclude from the cloth manufactured in India that deleterious matter which a noble Lord termed gypsum, for I fear that, with the benefits and civilizing influences of manufacturing industry, the Hindoo imported some of its vices which we all deplore. Thirdly—and on this point I lay stress—that of this duty, if it were abolished, not one penny would go into the pockets of the Lancashire operative or millowner, but would go soon, if not at once, towards increasing the purchasing power of the money of the poor inhabitants of India. But then some hon. Member might say—"But have you, then, no selfish motive at the bottom of all this? Do not you expect to get something by the abolition of these duties?—and I should say—"Certainly I do," but I should not call myself selfish. I should say that I was inspired by a feeling of enlightened self-interest. In other words, Sir, we do not expect an enhanced profit from the goods which we now sell; but we do hope to benefit by an increased basis for our commercial operations, and by a fairer and more even competition, as between the Indian manufacturer and ourselves. And now, Sir, let us look at what has been done in this matter. The noble Lord the Secretary of State for India (the Marquess of Salisbury) seeing that there was an Imperial side as well as a local Indian one to this question, and, judging that no Government was justified in taking up the role of Mrs. Jelly by in Dickens' novel, who was so anxious for the moral and material progress of Borrioboolagha that she was entirely oblivious of the wants and necessities of those of her own family, sent a despatch to India, which, robbed, of its official verbiage,

  1031
  —I do not speak disrepectfully—amounted to this—"These duties are bad in theory, and worse in practice; they ought to be abolished—they must be abolished as soon as you can afford; and I invite you to fix a term of years, the end of which shall be the vanishing point for these duties." But so careful was the noble Marquess to avoid embarrassing the Government in their financial proposals, so studious was he to avoid placing any new burden on the people of India that he expressly declared that he would sanction no new tax for the purpose of getting rid of the cotton duties. Now, when the Government of India received, this despatch, what did they do in an out-of-the-way place in India, far removed from that public opinion which, I will venture to say, does exist? In the absence of those unofficial Members of the Council who are, you might say, specially appointed to give opinions in a case of this character, with indecent haste, and on frivolous grounds, they passed a measure which went directly contrary to the expressed wishes and desire of the noble Marquess; and then, with a grim humour which the noble Marquess was, I think, not slow to appreciate, they telegraphed to say what they had done. When the noble Marquess received this telegram, he sent another despatch calling his insubordinate subordinates to order; and here, Sir, my duty as a critic of these Papers ends. I am far too young a Member of this House to venture for a moment to criticize the amenities of official and diplomatic correspondence, but this general remark I think I may make—that, both in the despatches to which I have alluded, and the correspondence which follows, the noble Marquess deals with his opponents and his critics much in the same way as a skilful player does with the nine pins in a familiar game. During the time in which this correspondence was going on, I heard rum ours that there was an attempt being made by some noble Lord or right hon. Gentleman to make the Viceroy of India and his Council nothing more than puppets dancing at the end of the telegraph wire worked by the said noble Lord or right hon. Gentleman in Downing Street; and if this could have been anything but a ridiculous proposition it would have received my condemnation; but I can see something
  1032
  worse which might happen, I mean making the Indian Minister here—the Representative of our Imperial sway—nothing more than the mouthpiece of Indian officialism, and degrading the deliberations of his Council to the level of what I have heard the hon. Member for Hackney denounce as a sham—the discussion of the Indian Budget in this House. If we allowed this to happen, Sir, we should be guilty of a policy which John Stuart Mill, in his Minutes, has declared to be the very ideal of badness—the one among all imaginable arrangements of the matter in question which no circumstances could justify, or could render otherwise than preposterous. I am told, Sir, that public opinion does not exist in India on this matter; but I have heard an ex-President of the Bombay Chamber of Commerce declare that, in the interest of the Indian mills themselves, these duties ought to be abolished; and, if you could only get the Native to understand this question, he would naturally say—"You had £400,000 to give away last year, and what did you do with it? Pipes and cigars, harness and saddlery; even billiard tables came in from your country, and you took £10,000 a-year from off the milinery and frippery of your wives, and yet you left this indefensible tax upon the clothing of the millions you profess to govern for their own good." Sir, in conclusion, we Lancashire manufacturers and operatives are fully aware of the grave responsibilities which rest on the shoulders of those of our distinguished countrymen who sway the destinies of our Indian Empire. We know how difficult—aye! how dangerous, under certain circumstances—it may be to impose a new tax upon that congregation of nations, alien in colour and creed, who have been rendered sullen and suspicious by centuries of oppression and wrong, and who are only now beginning to love and appreciate the benefits and blessings of our rule. That we do not ask; but, on the other hand, we do think that a country which has displayed such remarkable elasticity of trade, of which the noble Lord the Under Secretary has this evening borne such conclusive testimony—a country whose military expenditure is enormous—which can afford, apparently, to lose nigh on £2,000,000 of money in its postal, tele-

  1033
  graphic, and railway service—which, out of current income, can pay in ready money, the expenses of a great and devastating Famine—can,so we think, if economic counsels prevail, spare to us this miserable £800,000 in the interests of justice and fairness towards 80,000 of our fellow-countrymen, and in deference to those principles of Free Trade which have, I believe, become the leading political axioms of this country, and which throughout the world have contributed in no small degree to our stability and our power.
  MR. BALFOURsaid, that to form an estimate of the value of silver in the immediate future was out of the question. The value of silver depended upon the demand and the supply. France needed a supply of £l,000,000 a-year in silver for a population of 30,000,000, and if the same mode of computation were applied to Germany, America, and England the total amount required for subsidiary silver coinage would be about £6,000,000. The question would then remain as to how much would be required for the rest of the world, and especially for India. He thought that India would continue to absorb an average quantity of silver of the value of £5,000,000 annually. The position of India towards us was that of a country paying tribute to another. He believed the ultimate form which the tribute took was not silver or gold currency, but goods. He trusted that the result of the discussion would be that the Government would not feel itself hurried by any pressure from India into any wild extravagant schemes for remedying the evil to which we were now subjected. The most plausible of these schemes, and one which had received the sanction of the Bombay Chamber of Commerce, proposed to remedy the present depreciation of silver by raising the price of the rupee, and thus to make it practically a metallic bank note of an appreciated value; but to this there were three objections, each of which was conclusive. In the first place, no benefit would be gained, because to raise the value of the rupee would not enable one to buy gold on better terms; secondly, it would be impossible to carry out the scheme, because there would be forgeries to an enormous extent in America and elsewhere, which would have the result of bringing the rupee
  1034
  down to its normal value; and, thirdly, it would be dishonest towards all who had to pay debts in India. He begged to thank the House for listening attentively to his remarks on so technical a branch of the subject.
  MR. E. NOELsaid, there was nothing he should hail with greater delight than a retrenchment of the expenditure by the Indian Government, as he thought that was the only way to enable them to do without levying fresh taxation. It had been argued that the cotton duty in India was a protective duty, kept on to sustain an artificial manufacture. If that were really the statement of the case there was no man who would more strongly oppose it than he would; but he had not heard any argument in support of that view. He was ready to admit that the speeches of the hon. Member for Staley bridge (Mr. Sidebottom) and the hon. Member for Blackburn (Mr. Briggs) were exceedingly honest and able. They both urged on the Government the repeal of the Indian import duties for the benefit of the Lancashire manufacturers and operatives. But he contended that in discussing the Indian Budget they were bound rather to consider how any particular tax affected the Indian people than how it affected the interests of English manufacturers. The question was not whether this tax was a bad one. He would admit that it was bad; but, at the same time, there was no tax that was good, and before they took off a tax in the interests of England they were bound to consider whether they could do so to the advantage of the Indian people. He thought there were taxes levied in India that pressed more hardly upon the Natives than the cotton duty, and he hoped the Government would not interfere with it until they could do so in fairness to the Indian people. He should not like it to go out to India that it was wished in this country to keep down the development of the natural resources of India in the interests of the English cotton manufacturers. The first question they had to deal with was this—could they supply the place of the 5 per cent duty by any other tax which would press less hardly on the Natives of India?
  MR. BIRLEYsaid, he thought the hon. Member who had just sat down entirely misapprehended the argument

  1035
  of his hon. Friend the Member for Staley bridge (Mr. Sidebottom), and all that had happened during the last eventful year in Lancashire relative to this branch of Indian finance. It had been repeatedly said that the manufacturers of Lancashire were jealous of the natural advantages which India offered for the manufacture of cotton. Now they made no complaint on that score; but they did complain that a duty which was undoubtedly protective should be retained by the influence of the Imperial Government entirely contrary to those principles of Free Trade which had prevailed in this country for the last 30 years. How could they lecture foreign countries on their Protectionist policy or negotiate Commercial Treaties if they retained this obnoxious duty in India? If he could have brought the question forward on a substantive Motion earlier in the Session, he would have endeavoured to do it more justice than was now possible. He would, however, advert to the arguments of the Hon. Mr. Hope, Commissioner of Customs at Bombay, who contended that the state of Indian finances demanded the retention of the duty; that it was easily collected; that it occasioned no discontent; that it was drawn chiefly from one description of cotton; that it was light; that it was neither prohibitive nor protective; and that the only remedy it would be expedient to resort to would be a countervailing duty on Indian manufactures. Of course, if the amount of the duty was required it must be retained, until by economy we could spare that £800,000; and the revenue was, on the whole, expansive, having increased 25 per cent since 1860. The other arguments were essentially protectionist, and a free trader could not use them to maintain the duty. Duties on refined sugar or on silk manufactures would in many respects be convenient at home, but we had taken too firm a stand on free trade to entertain them. That the duty was neither prohibitory nor protectionist the hon. Member controverted by going into figures to show how it affected the manufacturer, falling as it did on a fraction of a quarter of the cost of the manufactured article; and its effect was proved by the fact that during the last 10 or 12 years it had almost driven the coarser productions of this country out of the market. He denied that it was wise to levy an
  1036
  Excise duty on the productions of the Indian mills. Every Manchester manufacturer would most strenuously object to any such policy. Although the Indian consumer did not make any complaint, he had to pay £800,000, from which he ought to be freed. Our manufactures were not expanding to the extent they ought; and we must remember what Adam Smith told us, that a very small advantage would enable the foreigner to supplant the home manufacturer even in his own market.
  GENERAL SIR GEORGE BALFOURheld that there were only four ways of getting over the present financial difficulties of India—to increase the existing revenues, by making them more productive, or to levy new taxes, to reduce the expenditure, or to borrow money; and, perhaps, all these modes might wisely be followed, except by levying new taxes. His own opinion was that economies could be largely effected in all branches of civil and military charges, both in India and in England; for the Home Charges showed that year by year the outlays for the purely Home Administration had been on the increase, and in a form quite unnecessary. Those increases were entirely separate from those which arose out of the demands sent from India, and which had largely swelled up the total outlay at home, so as to lessen the charges which ought to be shown in the Indian accounts, and increased the loss which had for several years appeared in the accounts for the remittance of funds to pay those large demands. And as regarded the military expenditure, there also the same practices had been resorted to of putting into the Home accounts some considerable charges which ought to have appeared in the Indian accounts, and of even transferring some charges in India to other accounts, so as to make the military outlay less than formerly. That was a practice open to the grave objection of making the present military expenditure appear, in comparison with that of 13 and 14 years ago, far more favourable than it really was, for charges to a considerable amount were now omitted which were formerly entered in the military outlay. But taking the whole of the present military charges in the Home and in the Indian accounts, he considered that £1,000,000 at least might easily be saved in

  1037
  the military expenditure. There were many openings for giving practical effect to that. No one who had studied the accounts for a series of years could fail to form the opinion that the outlay on military stores had been enormous; this could be shown by calculating the rate of store charge per head of the number of men maintained in India. Even admitting that changes in armaments of guns and arms had been frequent, yet the sums spent for new stores ought to have rendered the maintenance of these new arms and field-pieces far less costly. Then, again, the outlay on beer had certainly given an average consumption per man far in excess of the quantity which each man out of hospital and effective, out of the number of Europeans kept up, could afford to pay for out of his pay. The Staff of the Army of India was maintained on a costly scale, and Staff officers in various Departments multiplied in a way which was not only costly, but must multiply the office work of the battalions and regiments of Cavalry and Infantry, and of batteries of Artillery. Then, again, the Home Charges for the pay of officers at home and for supplying recruits were enormous, owing to the system followed by the War Office in raising and training men for India. The service of India was so much liked that recruits could always be obtained, so that none of the outlays needed for raising men for the Army generally should be debited to India. It was said to have been on grounds of public policy that the late Secretary of State for India (Viscount Halifax) deprived India of the European forces of the Indian Army, making India depend on the Home Army for the European portion of its garrison, and England ought not now to make the finances of India bear the burden of charges arising out of Home experiments to provide an Army for the Home defence. Then the organizations of battalions of Infantry, of regiments of Cavalry, and of brigades and batteries of Artillery, were all calculated to multiply establishments and Staff charges, as also officers, especially those of the higher ranks, as to cause great and unnecessary charges to fall on the revenues of India. The great objection to these expensive formations was that they were not those best suited for India, nor were they of the strengths
  1038
  actually fixed for the Army at home when taking the field. If due consideration were given to the real wants of India, or even to the rules for the field Army in Europe, then the Line regiments might be reduced from 50 to 39 battalions, the nine regiments of Cavalry might be reduced to six, and the number of batteries in the Artillery might also be reduced. That could be done without impairing the efficiency of the Army, or of cutting off even a single Infantry private, Cavalry trooper, or gunner of the Artillery, and the money gain to India would be very great. He was as much in favour as any man could be of efficiency, but retrenchment was now so necessary, in the face of an enormous deficiency of the income, to meet the present Indian expenditure, that it was the duty of England to aid India in effecting those economies which were so practicable and so necessary. They had had, in the course of this debate, the claims from Lancashire to have the duties now levied in India on the manufactures of Manchester removed from the tariff; but he thought that one thing was certain, that of all embarrassments to which India had been subject, that of financial embarrassment was her greatest difficulty in past times, and would be hereafter. The trade of India might be put on a proper footing by measures of a far more comprehensive character than those proposed by Lancashire, and calculated to extend commerce, and which would also relieve the finances of that country. If the Government removed only the Indian import duty on cotton goods and cotton twist, as had been advocated, that reduction would amount to a sum of £900,000, and there would only remain a sum from the import duties kept on of £800,000, principally raised from import duties on three of the 52 classes of goods now subject to import duties, so that if the claims from Manchester were attended to in favour of their particular trade, then, having regard to the claims of other traders there, these, as well as the duties on all the other 47 classes of goods, might then be advantageously reduced also. Of all services that could be rendered to the people of India and to the finances, he considered that the repeal of the remaining export duties on the few articles of Native produce would be the greatest. What was specially needed at

  1039
  the present time was an increase of exports from India—indeed, greater commercial activity in imports as well as exports—for of late years the uniform value of about £100,000,000 of imports and exports had been maintained; it was desirable to quicken trade, and no mode was so well calculated to do so than by removing all duties and Customs on trade and salt, trusting to the enormous commercial increase which India was capable of, for augmenting the other revenues; but reciprocity between India and this country was not only fair, but politic. The House was told of the large capital of this country invested in the looms of England which manufactured cottons for India, but £13,000,000 was also invested in the tea plantations of India. From these, 25,000,000 lbs. to 28,000,000 lbs. of tea were exported from India, and we levied at home upon that tea, which nearly all came to England, an amount of duty nearly equal to the duty levied in India upon the cotton goods of Manchester. Yet the cotton manufacturers in that House and out of it, who had claimed the reduction of the Indian import duty on cotton goods, had never complained of the duty levied in England on Indian tea. The same remarks would apply to the coffee grown in India by British capital, which paid a high duty in this country. If both these duties now charged at home on only two Indian products were added up, the amount would equal, if not exceed, the duties on Manchester goods levied in India; in fact, if England only practised the principles of free trade now recognized as sound, then the trade of India and of England would be freed from the war of tariffs which they now carried on; though he denounced that war when carried on by other foreign countries. Much stress had been laid on the loss now sustained by Indian revenues owing to the great difference between the money that could now be obtained in England on bills drawn on India for silver rupees deliverable in India for those English bills. But that loss ought to have been foreseen. The Government had been unnecessarily increasing the Home Charges, and had been changing their entire policy of making railways through private companies, and doing the work out of Government funds, thereby closing up a great source for funds being obtainable at home for
  1040
  Indian purposes. Then one of the greatest of all causes for diminishing the wants of India for silver was in the substitution of a paper currency for silver coins, which had been going on during the last 15 years, and so lessening the requirements of India for silver. Having been in India, and officially connected with some of the details about the introduction of notes, he begged to explain to the House that when he was at the head of the military finance of India, Mr. Wilson, to whose ability he bore warm testimony, came out as Minister of Finance, and took great interest in the currency of India. At that date there was but little or no paper currency in use beyond the three Presidency towns of Calcutta, Madras, and Bombay, and all the payments made in the interior were discharged by silver coins, for gold was entirely locked up, either hoarded or in ornaments; the cumbersome nature of these silver payments was so great as to be a burden to Government and an obstruction to traders. Among Mr. Wilson's plans was that of a paper currency for India, and it was intimately connected with the present silver question. The silver currency was then one of the greatest difficulties of India, for there was a great tendency for coins to get into out of the way places, and to be collected in masses, to the serious detriment of other places, often deprived of the means of exchange and obliged to resort to shells in some places for an exchangeable article. Indeed, one of the greatest difficulties of the Army in India was in their guarding the silver in its transit from one part of India to another distant part; and that troublesome duty was, in the opinion of the Native Army, a cause of great annoyance and a great grievance, and had actually constituted one of the elements that led to the Indian Mutiny. Well, Mr. Wilson's plans had for their object the substitution of a paper currency for a silver one, and when the hon. Member for Orkney (Mr. Laing) took charge of the Indian finances, he wisely and well perfected Mr. Wilson's scheme, and succeeded in doing away with the operation of shifting the silver coins from one part of India to another, so that the large amounts which formerly became locked up in distant localities, thus contributing to multiply the value and quantity, now no longer existed. The paper currency had now so cut down the silver cir-

  1041
  culating medium that it had been stated that night to be only about half the value it was formerly calculated to have been. The effect of the paper currency had been to economize the use of silver coins and thereby to lessen the quantity in use, and to diminish the necessity for silver in payments. Paper notes of varied denominations, from 5 rupees to 10,000 rupee notes, had been manufactured, and though the quantities in actual circulation on any given date only amounted in value to £12,000,000 or £13,000,000, still the value of notes printed and used in the year was quadrupled, so that the use of notes, and the facilities afforded by the Government in exchanging these notes for silver coins in any of the circles, irrespective of the legal right to have them cashed by the public Treasuries throughout the whole of India, had so largely diminished the silver coins as to reduce the circulation by one-half. The diminution of silver imported into India and the relatively small extent of coinage at the Mints of India proved that the silver currency had been decreased. The silver imports being mainly used for coinage, the people had probably melted up the coins for the ornaments which were so extensively used by the women and children of many millions in India. He contended that until such time as the necessary amount of silver for ornaments was restored to the people of India by increased imports, so long was depreciation in that commodity sure to continue. This demand for silver imports could only be created by the increase in the trade of India, especially by inducing exports to be largely augmented. That could be effected by enabling the produce of India to compete with the products of other countries. Freedom from Customs and taxes and cheapening transport would soon raise the trade of India on such a scale as to need a much larger currency of both paper and silver, as well as of increased imports of bullion, and by these means the loss now suffered in raising funds at home would soon be wiped off. There was one other question which required to be noticed, and that was in respect to the position of the Viceroy and Secretary of State. He considered the claims put forward from India of independence of the Secretary of State and Parliament were outrageous, and he hoped that the noble
  1042
  Marquess (the Marquess of Salisbury), or whoever might be his successor in the office which he held, would exercise his power temperately, but firmly to cut down that extravagant demand which was so much, in his opinion, to the discredit of our Indian administration.
  MR. GOSCHENhaving observed that the noble Lord the Under Secretary for India, at the conclusion of his clear and eloquent speech, invited the assistance of the House in the solution of the many important questions on which he had touched, said, he wished to comply with that invitation by making a few remarks on that especially which was connected with the depreciation of silver, in reference to which some able and instructive speeches had been made, and in particular that by the hon. Member for Hackney (Mr. Fawcett), which was so clear and exhaustive on the subject that it left little for other hon. Members to say upon it. He fully appreciated the cordial recognition given by the noble Lord to the labours of the Committee on the depreciation of silver; and he thought the noble Lord and the Government would best show their sense of the services which had been rendered by that Committee by continuing, if it was in their power, the inquiry which that Committee had undertaken. He felt sure that the noble Lord, who showed the greatest interest—he might almost say devotion—in the pursuit of the investigation, would take steps to have it still further carried out with the utmost care by means of examination at the India Office as well as in some of the other Government Departments. Those who had read the Report of the Committee would have seen that portion of their information had been received from foreign sources, and especially from America and Germany, and he hoped our Representatives all over Europe as well as in America would be instructed to continue to send home elaborate and careful Reports with respect to what was being done in connection with a subject so important. In dealing with it it should not be forgotten that there were two points which were deserving of special attention—depreciation and fluctuation—and that a great many of the evils which we had to deplore in the matter resulted, not so much from depreciation, but from the constant fluctuations in a commodity which had been made over a

  1043
  vast area the standard of value. That fluctuation, then, should be carefully watched, because it must be regarded as one of the main elements in guiding the Government as to the measures which they should adopt in the present emergency in India. Were, for instance, the remedies to be sought from that country or not? Was it necessary that Government should revise their contracts with the Indian Civil Service, or ought such a question be entertained by them as had been mentioned that evening already—the revision of the land tax? and it would be matter for consideration as to whether the existing depreciation of silver was to be regarded as permanent, or whether we might expect a reaction. He should be glad, he might add, to learn whether the Government had in their possession any Reports from Washington as to the steps which had been taken by the American Government with regard to the Bills on the subject of a silver currency which had been introduced into their Legislature. If the Government had received any despatches on the subject from their Consuls during the last six months, he should wish to be allowed to move for their production. The statistics the Committee collected with regard to produce of American mines practically ended with the year 1875. They had, indeed, further information for another three months from a gentleman who had received a kind of officious authority from the French Government to report to them on the produce of these celebrated mines. Her Majesty's Government would, however, be able to continue to obtain information on this vital point, and the produce of these mines must be watched with the greatest anxiety if we wished to form a correct opinion as to the future price of silver. It had been stated that these mines were producing half in gold and half in silver, and attention had likewise been called to the fact, which was of paramount importance, that the mines were alleged to pay themselves simply by the gold which they produced, and that the silver was practically produced without cost. M. Léon Say, the French Minister of Finance, had drawn the same conclusions from that fact, as the hon. Member for Hackney (Mr. Fawcett) had done, that by these mines being able to produce silver so cheaply they could drive all other mines out of the market.
  1044
  This raised the second question which he would venture to put to Her Majesty's Government—namely, whether they would endeavour to ascertain what effect the great fall in the value of silver had had upon its production in Mexico, South America, and other countries where there were silver mines? He thought, on the whole, that possibly sufficient importance had not hitherto been attached to this question of the effect upon other mines than these American mines of the great fall in the value of silver. He should say that if the prices of silver remained at their present point we must expect to see a decided falling off in some of the sources of supply. Then, again, it would be interesting to know what progress had been made in Germany with regard to the sale of the surplus stocks. We knew how the matter rested up to the end of June, but every month must throw fresh light on the subject, and therefore he should be glad if Her Majesty's Government would state whether they had any further information on the subject. From France he had received information that they were not increasing their stock of silver in the Bank of France, which meant that the depreciation of silver was not producing the effect of driving silver into the Bank of France while the gold was withdrawn. From this fact the French drew the inference that there was no great surplus stock in France. He hoped the Government would continue to give their closest attention to this subject, and would keep our Embassies and Ministers abroad up to the mark in reporting upon this question. It would be most interesting to hon. Members when they met again in February to know they had got the latest and most authentic information. He would now advert to another point—namely, the effect of the fall in the price of silver upon the trade of India. It did not follow that a depreciation in the fall of silver or a great increase in the production of silver must necessarily be an evil to any country, from the fact that the discovery of a valuable commodity added to the wealth of the world. It was clear we should only be able to obtain the silver now produced by paying for it in some way or other; and if our trade with one country should diminish we might look for the development of new branches of trade with other coun-

  1045
  tries resulting from the remarkable discoveries on the West Coast of America. Already a new trade was springing up between China and the West Coast of America, and when such, developments occurred this country, through its great commercial ascendancy, always managed to secure apart of the new trade. While, therefore, our manufacturers and merchants now had to encounter serious drawbacks, compensation might be in store for them through an increase of trade, not, indeed, commensurate with that brought about by the discoveries of gold, but commensurate with the causes which were bringing about a fall in the price of silver. The question which naturally arose was whether this fall had reached its lowest point and whether a rise might be expected? Now, his Colleagues on the Committee would confirm him in the statement that, after all their deliberations, they had failed to arrive at any conclusion upon that point. The fact was that the causes were so complicated and it was so impossible to measure the extent to which they might operate that he would be a bold man who ventured upon any prophecy. The noble Lord (Lord George Hamilton) was hopeful, and looked forward to a rise in the price of silver in the course of this year. The noble Lord spoke somewhat too strongly of the panic which had occurred, because he (Mr. Goschen) was inclined to agree that the causes now at work justified the apprehensions which were felt as to the fall in silver. On the other hand, his hon. Friend (Mr. Fawcett) seemed to draw the picture in very dark colours. For himself, he wished to be excused from giving any opinion as to whether silver was likely to fall or rise; but he should like to add one or two considerations to those enumerated in the Report of the Committee. As regarded the causes which were hostile to the value of silver, it might be assumed that, except as to the extent to which the silver mines in America might yield increased amounts, we now knew the worst. We knew the worst also as regarded the drafts of the Indian Government upon India, and the policy which had been announced secured this advantage from the disturbed relations between gold and silver in India—namely, that the Government had been obliged to face the question of Indian expenditure in a bold manner which
  1046
  would lead to permanent results. As to Germany, we knew approximately the amount of silver there. The action of the Latin Union and of those States which still had a silver currency in Europe was an open question; but should silver rise, or should things not grow worse, there seemed to be no disposition on the part of those Governments to substitute a gold for a silver currency. In the French Chambers, where the subject had been repeatedly debated, the Minister of Finance was in favour of an expectant attitute, but on the whole argued for the maintenance of the double standard; and there did not seem to be even a strong probability of the substitution of gold for silver entirely. The French Minister of Finance made a pregnant observation upon the difference between the fluctuation in silver and the depreciation of silver, pointing out that the mere fall in value was no argument against maintaining the system of a double currency to which they were attached in France, though it might require a re-consideration of the legal relation between gold and silver. He (Mr. Goschen) offered no opinion upon the value of this argument. He simply pointed to it as an indication that there did not seem to be any immediate fear that the French Government would take steps to demonetize silver. The supplies were very large, but the removals to the purchasing countries had been very considerable. These were causes strongly operating on this question and amply accounting for and justifying the alarm and the fall that had occurred. They must turn to the considerations which were on the other side—namely, the circumstances which might be expected to influence the price of silver in the other direction; but there they had this difficulty—they knew but little. They knew there were a number of indefinite causes which might produce a rise in the price of silver, but they were less able to measure them. Before he dealt specially with the case of India he would point to the enormous area over which the silver currency existed, and which might have a capacity for absorbing silver which they were unable to gauge. He thought there could be no better illustration of the chances of recovery in silver than what had, as he was informed, recently occurred in China. There, quite an unexpected de-

  1047
  mand for silver had arisen within the last few days. Great speculation in silver which no one had foreseen had arisen, and he was told that while here there had been such a glut of silver that everybody was alarmed, in China there was a panic with regard to the inability of procuring sufficient silver to purchase the silk at enhanced prices. The hon. Member for Hackney spoke—and it was one of the most interesting parts of his speech—of the effect which the fall in the value of silver would have on the export trade of India, and he traced very clearly how a fall in silver encouraged export, and how that would greatly tend to increase the price of commodities in India, and that then the cause would cease to operate and the finances of India would be left in a deplorable condition. But the hon. Gentleman did not complete his argument, for he should have pointed out that the increased flow of silver from England to India would produce a rise in the price of silver in England. Therefore, while the export trade was being developed, so also in this country there would be a rise in the price of silver as a result. This would necessitate the employment of a larger amount of silver in this country, and the consequence was that cause and effect would re-act upon each other. Already, it seemed, natural causes were beginning to operate; and he warned the Government and the public that no measures were more detrimental in restoring the price of silver than any courses tending to operate against silver. Speaking of the rise of price in India, he would add that there were some points on which he hoped the Government would collect information during the Recess. That was one of the points on which the Report was weakest, for the Committee could not collect the necessary materials in the time at their disposal. It would be curious to observe what the effect of the results of the past four years had been in connection with the fall of the price of silver in India. He had seen statistics which seemed to indicate that prices had by no means risen anything like the proportion in which silver had fallen in this country. It was most unlikely that such should be the case. The fall was distributed over so wide an area that the rise could not be otherwise than very gradual. The question of the rise in prices in India
  1048
  would be one to which the Government must give special and peculiar attention. It had been argued that it would be impossible or difficult to impose any fresh taxes on India or to increase existing ones. But if prices rose the ryots and other producers would receive increased prices for their articles and be able to pay increased taxes in the same proportion. From every point of view, however, the question of the adjustment of prices in India was one which demanded the closest attention of the Government. That there was an emergency no one who had followed the course of events or listened to the speech of the noble Lord could doubt. The noble Lord had shown clearly its effect on the revenues of India, on the tribute paid to this country on salaries, &c. About the £15,000,000 paid annually by India to this country he wished to say a word. No part of the statement of the noble Lord was more interesting than that which analyzed the mode in which that heavy charge was raised and the effect it produced on the finances of the Government. He showed how great a portion of that charge had arisen from guaranteed railways and from advances made to the Government for public works. From this subject he (Mr. Goschen) believed a useful moral might be drawn for the guidance of Governments generally. The Indian Government believed it was embarking in a simple transaction of lending for which it would receive a good return. It raised money in this country, and expected a return for it in India. It did not foresee that the operation, which lay somewhat beyond the necessary functions of a Government, would entail in the end a vast loss upon the Indian Exchequer. That, however, was the result, a large debt which had been contracted in gold having to be paid by a country that produced only silver. The Government should resist the constant tendency that there was for them to step beyond their proper function, and to embark in undertakings of almost a commercial character; and, indeed, there was now a sort of undertaking that no further addition in this direction should be made beyond what was absolutely necessary for extraordinary works. Borrowing had been mentioned, but he did not think that they could overcome the difficulty into which they had got by borrowing even upon a larger scale. He would not criticize in

  1049
  any hostile spirit the raising of the loan of £4,000,000; but he could not allow that the raising of this loan had anything more than a mere temporary effect, and that its natural tendency would be to check the natural causes that were now beginning to cause a fall in the price of silver. The noble Lord very properly described it as an artificial means of keeping up the exchanges for the time being; but he used dangerous language when he said that the Government wished to maintain the exchanges in order to avoid a perturbation in commerce. The recovery, he believed, had not occurred in consequence of that loan, but in consequence of the great demand for silver which had sprung up in consequence of the cheapness of produce. The noble Lord had referred very briefly to a remedy which appeared to be in considerable favour in very influential quarters—namely, the limitation of the coining of rupees. When Parliament separated it was very possible that the demand for that remedy might be revived, for it had been advocated in several Chambers of Commerce. The object of limiting the manufacture of rupees was clearly to maintain the exchange—that was to say, to give those who already possessed or had a claim to coined rupees a monopoly which the holders of other silver had not. What would be the result of that? He could fancy that the Indian Council might say—he trusted they would not—"We are in this position. We have claims on India to the extent of £15,000,000 sterling in coined rupees. India owes us this money, and must pay it, not in silver, but in coined rupees. If, therefore, no further rupees are coined, we shall keep up the price of the article of which we have this monopoly." The Indian Government, or the Home Government, or the holders of the debt, might, therefore, appear to have a momentary advantage in maintaining the rupee at that price. A large number of Manchester or other manufacturers might be in precisely the same position; they might have large sums owing to them in India for the goods they had sold, and the amount due to them would have to be paid in coined rupees. Consequently, if by any means the value of the coined rupee must be maintained, they would receive in return that to which an artificial value had been given—namely, a piece of
  1050
  coined silver. But to limit the coinage of silver would practically be to demonetize silver as a metal; and then all those in India who had debts to pay could only obtain coined rupees with which to pay them by buying them at a constantly enhancing price from those who possessed them. They could not discontinue the coining of rupees without providing some currency; and what would that currency be? Could India be left without those means of legal tender which every country required? In France and Holland there was a double standard, so that if those who owed money were unable to get their silver coined, they could not get their gold coined. But that would not be the position of India—at all events, at present. There were powerful advocates of the introduction of a gold currency into India; but he had never seen any practical mode suggested for carrying it out. The interesting process which had been going on in Germany since 1871 in connection with a change of currency might afford them a very instructive lesson on that subject. The difficulties of that operation had been enormous in Germany, and must be far greater in a country like India. Germany was close to all the gold markets of Europe, was in constant banking relations with its neighbours, and had a population more or less accustomed to banking expedients, which all facilitated such a transaction as that. India was in an entirely different position. But, further, if it were put to the intelligent majority in Germany whether they had gained by the substitution of gold for silver, he doubted whether the answer would, on the whole, be in the affirmative. What the advocates of those changes of currency looked to was what might be called the international currency, or the means of settling the great mercantile transactions between one country and another. But the currency had an equal important function internally, and they had to consider, not only whether the trade of India with other countries would be facilitated by the adoption of a gold currency, but what would be the feelings of the population of India in having gold instead of silver. In Germany and France it was certain that the great bulk of the population preferred silver to gold, and it would, he thought, be found that in countries with small laborious popula-

  1051
  tions a silver currency was always most acceptable. He could conceive no policy more unsound or inexpedient than that a change of currency should be forced upon a country which did not desire it. There was scarcely a country in the East in which the people were not accustomed to a silver currency and in which it would be a dangerous experiment to force a change from silver to gold. The financial difficulties attending such a change would be enormous. Germany began by amassing, through the power which the payment of an enormous indemnity gave her, an immense stock of gold. Then came the question at what rate the exchange took place from silver to gold, so that in the transaction no injustice would be done to debtor and creditor. The exchange was finally settled at 15½—that was, the value of silver relatively to gold was taken at 15½, and contracts that were made in the one standard were made legal in the other. By the fall in the value of silver the German Government had sustained a great loss in the operation. Although the exchange of silver was now 17½, they were now obliged to give gold at the exchange of 15½. At what rate, he asked, would the gold standard be introduced in India? Was the rupee to be taken at 1s. 10 d. or 2s., for this would make an enormous difference on a circulation of £100,000,000, and the loss would be still greater by the fall in price which the operation would occasion in India as it did in Germany? The proportions of the question were gigantic, and it deserved the grave consideration of Her Majesty's Government before any decision was finally arrived at. There was one other point to which he wished to call attention. There was at the present moment a great plethora of gold in the Banks of England and France, but that had not always been the case, and he would be a bold man who would withdraw silver from that partnership with gold, by means of which a sufficient supply was furnished to do the currency for the whole globe. The Germans had the great advantages which the depression of trade gave them at a moment when they were making their conversion. We had seen, he might add, the results of a great increase in the supply of gold, but we had not seen what the results would be of the withdrawal of a large mass of money from the currency
  1052
  of the world. There appeared to him to be considerations which disposed of the expediency of such an immense operation as the adoption of a gold currency in India; and he trusted the Government would speak with no uncertain sound on the matter, as any illusion with regard to it would only tend further to disturb a market which was already so agitated. Both in this country and in India it was better to bear fluctuations than to take a step which it would be difficult to retrace and which might produce evils the result of which it was impossible to foresee. He was quite satisfied with the declarations of the noble Lord, made, he hoped, on the part of the Government, on the subject, and was glad of the opportunity which had been afforded of discussing the matter, so that during the Recess no misconception could exist.
  MR. GRANT DUFFcongratulated the noble Lord opposite on having made, under painful and exceptional circumstances, a statement about Indian finance, as satisfactory as the language in which it was expressed was clear and graceful. He must also congratulate him on the discussion which a few days ago occurred in "another place," which proved clearly that if a distinguished public man who had lately returned from serving his country in India had been in a position to hold once a-week a conversation with the Secretary of State, the divergence of view between those two eminent men would be found to have been very small indeed, and that there was no desire to establish between the Government at home and that in India relations which must sooner or later end in national calamity. Passing to another subject, he agreed to a great extent with the general conclusions to which some of the Lancashire Representatives who had addressed the House had come; but he thought they would have shown more of the wisdom of the serpent if they had argued their case from the Indian and not from the English side. He objected to drawing a sharp line, as had been done by one speaker, between the interests of England and of India. These interests were far indeed from being necessarily antagonistic, or anything like it. He could not pretend to have more interest in Lancashire than in any other county of the United Kingdom, but he had a very strong interest in In-

  1053
  dia; and, looking at the matter from the Indian side, he wished to see the gradual disappearance not only of the cotton duties, but of all Indian import and export duties whatever. Of course, in the present state of affairs, the Indian Exchequer could not be asked to part with any source of revenue whatever, good or bad; but when better times came, he trusted that Indian financiers would steadily keep in view two objects of paramount importance, the equalization of the salt tax, and the gradual abolition of Customs duties. He deeply regretted the agitation which had led to the giving up of the income tax. He should have liked to have seen the income tax kept at 2 per cent, and used for the attainment of that end. It was very unfortunate that we had allowed our Colonies to wander so far as they had done from the paths of free trade. He knew, of course, that circumstances had been very adverse when we had allowed our Colonies to do so; but our relations to India were not the same as our relations to our Colonies, and it would be truly deplorable if, because a little temporary inconvenience might be caused, we were not steadily to keep in view the freeing of Indian trade from all shackles. That was a goal to which we should continually tend, if without haste, yet without rest.
  LORD GEORGE HAMILTONsaid, the tone of the debate being so much in favour of the policy of the Government, he should not detain the House by any lengthened speech in reply to the suggestions and criticisms that had been offered. He assured the right hon. Gentleman (Mr. Goschen) that his suggestions would receive the most careful consideration of the Government. With respect to his noble Friend's (Lord Salisbury's) action in reference to the Indian tariff he could assure the House that it was not any imperious dictation to the Indian Government, but was necessitated by the fact that his despatch disapproving of the principles of that tariff did not arrive in India until after the tariff had been adopted by the Governor General's Council, and had the Secretary of State sanctioned it he would have been in the position of supporting a measure of which he did not approve. He hoped the hon. Member for Staley-bridge (Mr. Sidebottom) would not press his Resolution, for it was impossible, under the present circumstances, to dispense
  1054
  with duties that produced a revenue of £800,000 a-year. He agreed with many of the views expressed by the hon. Member for Hackney (Mr. Fawcett), who was justified in suggesting the curtailment of public works which were to be constructed by means of loans, and he fully agreed with the hon. Member in his condemnation of borrowing for the construction of such works in this country. The Amendment of the hon. Member was an abstract Resolution, and although he thought it went in the right direction, the danger was that circumstances might arise which could not be foreseen, and the abstract Resolution, if adopted, might seriously embarrass the action of the Government. He therefore hoped it would not be pressed to a division.
  MR. SIDEBOTTOMsaid, after the appeal of the noble Lord he would not move his Resolution.
  COLONEL JERVIS, who had on the Paper an Amendment on the hon. Gentleman's (Mr. Fawcett's) Amendment, said, he would not move it at that late hour, but hoped the noble Lord would consider the subject with which it dealt during the Recess.
  MR. FAWCETTsaid, after the appeal which had been made to him by the Under Secretary for India he should withdraw his Amendment.
  Amendment, by leave, withdrawn.
  Main Question, "That Mr. Speaker do now leave the Chair," put, and agreed to.
  Matter considered in Committee.
  (In the Committee.)
  Resolved, That it appears by the Accounts laid before this House that the total Revenue of India for the year ending the 31st day of March 1875 was £50,570,171; the charges in India, including the collection of the Revenue, Interest on Debt, and Public Works ordinary, were £40,760,583; the charges in England (including £1,595,878, the value of Stores supplied to India) were £8,245,829; the Guaranteed Interest on the Capital of Railway and other Companies, in India and in England, deducting net Traffic Receipts, was £1,244,562, making a total charge for the same year of £50,250,974; and there was an excess of Income over Expenditure in that year amounting to £319,197; that the charge for Public Works extraordinary was £2,249,571, and that, including that charge, the excess of Expenditure over Income was £3,930,374.
  Resolution to be reported To-morrow.

NORWICH AND BOSTON (CORRUPT VOTERS) BILL— [Bill 244.]
(Mr. Attorney General, Mr. Solicitor General for Ireland.)
NORWICH AND BOSTON (CORRUPT VOTERS) BILL— [Bill 244.]

  COMMITTEE.
  Order for Committee read.
  MR. INGRAMsaid, he considered it a hardship that certain men had been selected for punishment, while others, who were the principals, were allowed to go scot free. He should like to know the reasons which had induced the Government to adopt this course?
  THE ATTORNEY GENERALsaid, the Bill had been introduced in consequence of the Report of the Commissioners appointed to inquire into the cases of the borough of Boston and the city of Norwich. All that this Bill proposed to do with regard to Boston was to disfranchise the scheduled persons for seven years. With respect to Norwich the Commissioners reported that corrupt practices prevailed at the elections of 1874 and 1875, and that a great number of voters were colourably employed. But at no other election since 1860 had corrupt practices extensively prevailed. Therefore, the Government thought the case would be met by providing that no fresh writ should issue for Norwich during the present Parliament, and that those persons whose names were scheduled should be unable to vote for a Member of Parliament for seven years.
  MR. COLMANsaid, he should not at that late hour of the evening, or he might say at that late period of the Session, delay the House by making more than a few remarks before going into Committee on the Bill. He was glad that the task he had to perform was a simple one. He had placed an Amendment on the Paper; but he thought after the statement of the hon. and learned Gentleman the Attorney General, in reference to the Bill before the House, it would not be necessary for him to say very much. But he wished just to point out in reference to the Norwich elections that though some rather questionable circumstances had happened in that city, there were some boroughs which were comparatively free from much political excitement that might be contrasted with Norwich without much disparagement to the city he represented. Certainly it might
  1056
  be said that there were some exceptional causes in Norwich owing to the strong personal feeling that existed in reference to one of the candidates. He said this, not to excuse anything that had happened of an improper nature, but rather to explain some of the exciting scenes that had been brought before the country in the Report of the Commissioners. The hon. and learned Gentleman the Attorney General had said that the Report of the Commissioners came to this—and he (Mr. Colman), for one, frankly expressed his regret for it—that at the last two elections in Norwich, there was, according to the phrase used by the Commissioners, "colourable employment." Now, he hoped the House would bear in mind the fact that the cost of an election was, perhaps, a rough, but, at the same time, a very good test of its purity, and that when they found a very costly election, they might be pretty sure that something had been going on that ought not to have been. He was not there to say that the elections in Norwich had been conducted with economy—he was afraid they had not; but he hoped the House would allow him to quote some figures which he had culled from Parliamentary Returns, and in doing so he would refrain from mentioning the names of the places to which the figures referred, as he did not wish to say anything that might lead to unnecessary discussion. There was a borough containing 23,000 voters—and he might here say that something turned on the size of a constituency—in which the money spent on behalf of the different candidates averaged 8s. 10 d. per voter. In another containing a constituency of 20,000, the average per voter was 9s. 1d.; in a third, with a constituency of 7,000, where there were two candidates, the cost was 11 s. 3d. per head; in a fourth, with a constituency of 23,000, the expenditure was 13 s. 9d. per voter; in a fifth, where there were 6,000 voters, the cost was 16 s. 2d. per head; and in another borough, with not much over that number of constituents, the cost was 23 s. per voter. Well, after these figures, he wished to call the attention of the House to the expenses at Norwich. In that city the cost was put at 11 s. 6d. per voter; but in this case it should be remembered that the expenses were calculated not merely on the published Re-

  1057
  turns, but also on the outside payments that had been brought before the Royal Commissioners. With regard to these outside payments he heard of them elsewhere. Some hon. Members of that House had told him that in their boroughs and among their constituencies they knew nothing of these outside payments, or that if they were brought before them they refused to pay; but there were places where the outside claims were known and acknowledged, and he must express a hope that the hon. and learned Attorney General, in any Bill he might bring in at any future time in reference to corrupt practices, would turn his attention to this point. His late Colleague (Baron Huddleston), who had gone out of the sphere of that House to a serener one, had explained before the Commissioners the difficulty in which candidates were placed. He pointed out that an agent came and explained that such and such debts had been incurred on his behalf by a friend. Well, it was to be hoped that the House would enact such laws that instead of these charges being met as debts of honour which the candidates were bound to pay, they should be regarded as debts of dishonour, and in that case the country would get rid of a great deal of corruption. He had already given figures showing that Norwich was not to be looked upon as the only black spot on the electoral purity of the country; but he wished, before sitting down, to give another instance to show what could be done where the candidates made up their minds to have an election conducted purely. He would refer to a case of a constituency of 46,000, where the average cost per voter was only 1s. 10 d.; to another where there were 36,700 voters, and the cost was 1s. 9d. per head; and to a third, where the voters numbered 18,650, and the average cost was only 1s. 2½d. per head. The last-mentioned case showed such a creditable state of affairs that he thought he might in this particular instance break the rule he had laid down for himself and state that the borough which had the honour of conducting its elections as cheaply as any in England was the borough of Oldham. He would not trouble the House with any lengthened remarks. He had already presented Petitions from some of his constituents, who considered that their case really required some attention, and he had simply
  1058
  to say on their behalf that whilst admitting frankly that Mr. Commissioner M'Mahon agreed substantially with the Report of the other Commissioners, there were among his constituents those who entertained a doubt whether he would have agreed with them as to the precise names that had been put into the Schedule, or as to some of those that had been omitted from it. He had presented Petitions from some who thought that their case was one of peculiar hardship. He had only to say that he fully appreciated the manner in which the Government had treated this question. They had not been disposed to deal harshly with a constituency that had not hitherto been very favourable to them; and he trusted that the constituency he represented might hereafter have the high honour of being pointed out as one of those amongst whom elections were conducted cheaply and purely.
  Bill considered in Committee, and reported; as amended, to be considered To-morrow.
  House adjourned at a quarter after Two o'clock.