§ Order for Third Reading read.
§ Motion made, and Question proposed, "That the Bill be now read the third time."
§ *(10.31.) MR. MONTAGU (Tower Hamlets, Whitechapel)
Although I take a great interest in this currency question, I do not propose at this advanced period of the Session to occupy the time of the House with any lengthened observations. When the Bill was introduced by the Chancellor of the Exchequer during the last hour on a Wednesday there was no opportunity for discussing it, and on the Motion for the Second Reading I was induced to abstain from speaking on the promise that an opportunity should be afforded me on the Third Reading. But a criticism of it cannot be so effective at a stage when its passing is a foregone conclusion. This is a permissive Bill, the operation of which will take a long time, and it may be that the Chancellor of the Exchequer next Session will bring in a complete measure with regard to the currency which will materially affect this Bill and satisfy my friends in the City. I am very disappointed with this Bill, and so are my City friends; its introduction has been greatly delayed on the understanding that it was to be a comprehensive measure of currency reform; and this Bill in no way answers our expectations. Although it has been under the consideration of the Chancellor of the Exchequer for years it is a meagre Bill, not at all worthy of a Chancellor of the Exchequer with a commercial education. The speech of the right hon. Gentleman at Leeds produced the belief that we were to have an immediate issue of £1 notes to save the wear of gold and to provide a reserve of gold, so that we might not in future incur obligation to 1197 the Bank of France or the Russian Government. I do not complain of the borrowing of gold from the Bank of France; it was an act of reciprocity, for 30 years ago the operation was reversed, and the Bank of England lent the Bank of France two millions gold. Bat I do not think we should have asked the Russian Government a favour we should hardly venture to reciprocate. If we had had an issue of £1 notes we should have avoided incurring these humiliating obligations. I was afraid from his Leeds speech that the Chancellor of the Exchequer would have gone to the other extreme, and would have issued 10s. notes based on silver, and I am glad that the idea of issuing notes against silver has been abandoned. The only argument against one pound notes is the bogey of forgery, which is hardly worth attention. Four years ago I sent the Chancellor of the Exchequer a German twenty mark note which had never been forged, and inquiries I made the other day show that it has not since then been forged. I think, therefore, the right hon. Gentleman would have done well to have included in this Bill a provision for the issue of one pound notes, for it would have created a reserve of gold and been a protection to the commercial community. I have also shown the right hon. Gentleman that the notes could be issued at a cost of 1d., or £4,000 a year for 5,000,000, the duration of a note being five years.
§ MR. SPEAKER
Order, order! I do not think that these remarks have anything to do with a Bill for renovating the gold coinage.
§ *MR. MONTAGU
Of course, Sir, I bow to your ruling at once. But I desire to point out that the Chancellor of the Exchequer has raised the alarm with regard to the gold reserve and has done nothing to provide a remedy. To my mind the Bill is entirely unsatisfactory, because it provides no remedy for existing defects; neither does it provide for future deterioration. No provision is made for keeping our currency in proper order. It does not alter our system, of coining gold without charge, while all other countries make a small charge for mintage. A charge of even a halfpenny on the sovereign would prevent many millions of gold coin from being melted down and the selection of the heavy pieces for melting, which 1198 means the survival of the most unfit. When he introduced his Bill the right hon. Gentleman said there was a mint charge of about 1½d. an oz., but that is not a charge for mintage: it is merely to prevent the loss of interest. A man may take a bar of gold of the weight of 100 sovereigns to the Mint, and receive 100 sovereigns for it, and then melt them down and take the bar to the Mint, so that the Mint loses by each operation. I have known a large quantity of heavy sovereigns to be melted down in order to provide gold for exportation. If there were a small mintage charged it would frequently divert a drain of gold from this country to the Continent. Again, this Bill does not abolish the absurd system of requiring every one to cut light gold. Of course, that provision must be suspended during the operation of this Bill. When the Bill was introduced in regard to pre-Victorian sovereigns I suggested that this law should be abolished, because it was universally disregarded. I am told that even the Bank of England has not cut light sovereigns during the present year. If we had a small charge for mintage the Bank of England could be authorised to keep up the circulation continuously by the withdrawal of all light gold, thus maintaining the currency in proper order. I fear with the Chancellor of the Exchequer that it will take a long time to get the light gold out of circulation while the public know that light gold will be received at the Bank at its full value, and I would suggest that the Chancellor of the Exchequer should call in first the Victorian sovereigns that are without the beautiful George and Dragon reverse, and which constitute about nine-tenths of the light gold. When I proposed in Committee that the Chancellor of the Exchequer should increase the weight of our half-sovereigns by one grain, he produced a Report to the effect that the advantage would be very small, and would not be reaped for 150 years. I thought that an exaggerated statement at the time, and inquiries since made have amply confirmed my view. I want the Chancellor of the Exchequer to consider whether, before completing this enormous operation in recoining, he will not take the advice of exports as to various improvements in the currency, and at the same time 1199 issue £1 notes, as he will never have a better opportunity that when light gold is sent in to issue £1 notes against them. This is, I know, a technical subject, and I regret that the suggestions I have pressed on the right hon. Gentleman year after year have not been accepted and acted upon.
§ (10.45.) MR. ATKINSON (Boston)
The hon. Member for Whitechapel has addressed the House as an expert on this subject, and nobody has listened to him. That conveys to my mind the fact that 500 out of the 670 Members of this House do not understand the subject on which the hon. Member has just spoken. The Chancellor of the Exchequer ought to be in the House. If it is not worth his while to defend his Bill in the House, it is not worth our while as Members to pass it. I ask the House to signify their disapproval of the right hon. Gentleman's absence by refusing to pass his Bill. I shall take a Division on the Bill if my hon. Friend opposite does not. I consider the measure very crude, and think the criticisms of the hon. Gentleman opposite are founded on right and justice, and, therefore, I shall support the hon. Gentleman and vote against the Bill. I have been for 27 years the Chairman of a prosperous bank, and I say that if the Chancellor of the Exchequer does not think it worth his while to defend his Bill he is deserving of defeat, and I shall help to inflict it on him.
§ Question put, and agreed to.
§ Bill read the third time, and passed.