§ LORD WHARNCLIFFE, after some prefatory remarks which were totally inaudible, put the following question, of which 363 he had given notice: "Whether there have been any applications to the Bank of England by the Government for advances from the former beyond the usual amount required upon deficiency bills for the current public service, during the latter half of the year 1846, and down to the present period; and if so, whether there would be any objection to producing the correspondence or communications connected therewith?"
§ The MARQUESS of LANSDOWNEsaid, in the first place he had to state that, far from complaining of the question having been put, he thought that at the present moment it was a natural and fit question to ask. With respect to the question itself, he could say distinctly that beyond the mere formal and constant correspondence on the subjects usually discussed between the Bank and the Government, and which formed part of the usual machinery of Government, there had been no correspondence whatever on the subject of the noble Lord's question; but it was true that the Chancellor of the Exchequer had had, from time to time during the last quarter, personal communications with the Bank on this subject, but none of them taking the shape of written correspondence; and in the course of these communications the Bank had been uniformly apprised of the demands—not much exceeding the demands of common years—that the Government would have to make upon them. Of the excess of securities in the Bank, of which so much had been said, he might observe, that the excess had been much more an excess of private securities than an excess of Government securities. It appeared from the returns that on the 9th of January, the private securities in the Bank were 14,400,000l., and they had risen on the 14th of April to 18,627,000l.; and at the moment when the advances of the Bank to the Government had been the highest—on the 8th of April, namely—the amount of private securities was 18,136,000l., being many millions increase beyond what it was at the commencement of the year. If there was anything to lament at this moment with regard to the monetary affairs of the country, it was the pressure to which the noble Lord had referred; but considering the variety of causes which had occurred calculated to give rise to that pressure—considering the extraordinary state of the country, the great demand for the importation of food—instead of being surprised that any such pressure should have come upon the Bank, 364 his only surprise was, that it had not been felt much sooner. Had precautions been taken at an earlier period, the pressure would have been less severe; he trusted, however, that it would soon be overcome; and he could confidently state that it was the anxious desire of the Government and the Treasury not to add to the difficulties of the country by any interference with the management of the Bank, but to leave that body a sole control over its own affairs.
LORD BROUGHAMwas of opinion that, considering the very extraordinary circumstances that had occurred, it was not in the power either of the Bank or of the Government to have prevented the crisis that had happened, which might fairly be traced to the failure of the potato crop, to the vast importation of foreign corn, and to the continual drain on the money market for supplying capital to the carrying on of railways, which amounted in less than six weeks to a sum of 3,000,000l. These were circumstances which must necessarily lead to a deranged state of the exchanges.