HL Deb 10 August 1855 vol 139 cc2085-101

Order of the Day for the House to be put into a Committee read.

EARL GRANVILLE moved, That the House do now resolve itself into a Committee on the said Bill.


considered the present Bill to afford a fitting opportunity for making a few observations on the present financial condition of the country. They had now arrived at the close of a Session in which a much greater amount of money to meet the supplies this year had been raised by taxation and by loan than in any year since that of the termination of the last war by the victory of Waterloo He did not, however, object to the expenditure they were incurring, or to the amount of money they had borrowed under present exigencies, because he believed there was no one of their Lordships, not even any one of the few who were peace advocates, who was not ready to assent to the principle, that the country being now engaged in a great contest, it was the duty of Parliament unhesitatingly to make all the sacrifices necessary to bring that contest to a speedy and successful termination. There was no circumstance more encouraging or more characteristic of the noble spirit of the people of England than the readiness which both sides of the House of Commons had shown to assist the Government and to make the most liberal provision for the war. But it was not on that account the less our duty to examine carefully the cause we were engaged in. He would, therefore, inquire what was our present expenditure as compared with its average amount for the three years immediately preceding the war? The army expenditure, on the average of 1851, 1852, and 1853, was 6,828,000l.; in 1854 it rose to 8,810,000l.; and in 1855 it reached 18,789,0001. Our naval expenditure underwent an enormous increase, its average on the three years ending in 1853 being 6,828,000l.; whilst in 1854 it rose to 14,800,000l.; and in the present year it exceeded 19,000,000l. The Ordnance expenditure on the average of the three years ending in 1853 was 2,666,000l.; in 1854 it increased to 5,900,000l.; and this year it rose to 8,644,000l. The aggregate expenditure for the war departments, on the average of the three years above named was 16,300,000l.; in 1854 it amounted to 29,600,000l.; and in 1855 to 46,812,000l. Add to this the Vote of credit for 3,000,000l., and we have a sum of nearly 50,000,000l. voted this year to defray the cost of the war. We were necessarily required to add to the charges for our debt the total amount for which the country was called upon to provide for the expenditure of the year, including the cost of the civil establishments and the interest of the debt, being between 80,000,000l. and 90,000,000l. Now, nothing that was really wanted for the purposes of the war ought to be grudged; but he grudged every increased charge, which, going beyond the wants and necessities of the war, introduced a new and bad principle, which must in the end fail. He regretted to find that a large proportion of this enormous expenditure was intended, not so much for the present services in the Crimea and the Baltic, as for the creation in this country of permanent future military establishments infinitely greater than could be maintained in time of peace. Large sums were expended actually and engagements prospectively incurred for erecting huge barracks and camps at home. It was the fashion to say, and no doubt it was to some extent true, that the losses we encountered at the commencement of the war might be attributable to an undue reduction of our military establishments during the peace. This argument, when true, was carried much too far; and it was not true in all cases—far too much of the costs we had endured had been ascribed to that one cause. Even if true, this was a dangerous argument to rely upon. It could never justify extravagance, for when the war was over he did not think the people of England would be found more disposed than formerly to tolerate an undue expenditure, for the purpose of keeping up our military establishments above their just scale, in time of peace. It should be borne in mind that, but for the reduction of our establishments and the consequent remissions of taxation which had been made during the peace, this country could never have accumulated the unexampled wealth and attained the almost inexhaustible credit which now enabled it to bear the colossal burdens imposed upon it since the renewal of hostilities. Experience of the past showed that it would be vain to expect the people of this country to endure War taxation and war establishments at a time when peace should have happily returned. The horrors of war were sufficiently manifest in the double demand made upon the finances of the country between. April and August in the present year. The Chancellor of the Exchequer had laid before the Home two Estimates in the course of the present Session. The first estimate proposed in April for the army amounted to 16,221,197l.; but there was a supplemental estimate taken for the same service in the present month, amounting to 2,568,335l. The Navy estimate in April was 16,653,042l., and the supplemental Vote in August 2,725,971l. The first Ordnance Estimate in April was 7,803,154l., and the supplemental estimate in August, 841,138l; making the total original for these three departments 43,677,393l.; and two months later adding a supplemental estimate to the amount of 6,135,000l., defended as being the result of the experience gained from a two months' duration of war. In the original budget the Chancellor of the Exchequer had a large deficiency of income to provide for, and, with practical good sense, he had not relied on one single resource as the means of meeting this extraordinary expenditure, but had preferred new taxes to the amount he thought the country could bear, and obtained the balance by a loan contracted in the open market, and made on prudent terms. But finding afterwards that he required an additional grant of 6,000,000l. he proposed, by the Bill now before the House, to raise this sum either by means of issuing additional Exchequer bills or Exchequer bonds. Now, he (Lord Monteagle) intreated Her Majesty's Ministers in that House to impress upon their colleague elsewhere that only the first of these alternatives should be resorted to; he meant the issue of Exchequer bills. The inconvenience attending the issue of Exchequer bonds had been proved by experience the system was not worthy of a country like this where commercial credit was unbounded, nor did it suit the game of the money market which it was intended to gratify. The issuing of bills at a long date was the spendthrift's resource, and was still more unjustifiable where no fixed fund was provided to pay off the debt. It must be remembered too that a chancellor of the Exchequer could not new resort to such easy means for raising money as were employed by Mr. Pitt in the French war; there was now no Bank restriction, and Government securities had to compete with railway debentures and securities of all sorts, which in some respects were preferable to the new securities which had been tried and failed. These Exchequer bonds were unwise engagements, being promises to pay at some future time when they had no assurance as to the ability of the Treasury to discharge them. They were also unwise as contracts to pay the same interest for the next four or six years, whether there should be peace or war, and whatever might be the value of money. Exchequer bills, on the contrary, possessed this advantage—that the interest on them could be altered as the Chancellor of the Exchequer thought advisable. Even under all these circumstances the right hon. Gentleman had retained a margin not exceeding some 200,000l. or 300,000l., and the vast expenditure into which the country was now plunged made him (Lord Monteagle) regret more than ever that Parliament had been persuaded to repeal the newspaper stamp duty, the most gratuitous and uncalled-for sacrifice of revenue that had perhaps ever been made. This was a tax which was improving yearly, having risen from 320,000l. in 1845 to 488,000l. in 1854; its continuance was desired by those most interested in the matter, and the result of its remission had been actually to impose an additional tax on the consumers, in at least one case. That the former tax had not been injurious in the case of an ably conducted journal was shown by the great increase in the circulation of The Times, which in the last half-year had risen to upwards of 9,000,000—an issue somewhere about three times as great as that of all the other morning papers put together. Then their Lordships should remember that a loan had been guaranteed to Turkey, and advances had been made to Sardinia. He did not complain of either of those engagements, though, by the manner in which the Turkish Loan had been made, this country had contracted an unwise and uncalled-for obligation. Approving of the loan he thought a grievous mistake had been committed in giving our, obligation for the whole, and not for our own share of the loan; he regretted that the same course had not been followed as was prudently adopted by the parties to the Greek Loan. In 1830, Lord Aberdeen, the Duke of Wellington, and subsequently stipulated that England should only be bound for one third of the loan, and those eminent statesmen did not think that by so doing they were offering any insult to Russia or France, the other guaranteeing Powers. It was too bad, with this precedent before our eyes, that it should be stated that those who, like himself, had objected to the form in which the Turkish loan was contracted were offering an insult to France; he, on the contrary, affirmed that to have adopted the former course, would not only have been in conformity with an approved precedent, but would have been wise and prudent in so far as it tended to prevent future differences. With regard to Sardinia, they all rejoiced at the assistance afforded by the brave and excellent troops sent from that country to the Crimea; and it was equally certain that the resources of Sardinia were not in themselves sufficient for this object. He would now refer to the financial arrangements carried into effect in consequence of the recent change of system in the War Office. In the observations he was about to make, he meant not the slightest disrespect to the noble Lord at the head of that department, for he believed that noble Lord, from his long experience as Secretary at War, and from his character and abilities, was the man of all others the most likely to overcome difficulties and to vindicate for himself a new claim to the respect of the country. He would not now allude to the military part of the question; but only to its financial results; he would impress on the House and on his noble Friend the necessity of looking practically on this part of the question. In regard, to the financial arrangements of the War Department, he must take the liberty of inquiring and expressing some doubts, whether the object desired had been attained. Under the old system, which he was not the person to defend as one in all respects perfect, the Secretary at War was at least some check on the war authorities in respect to extravagant or irregular expenditure. Mr. Sidney Herbert had stated, in answer to a question put to him, that if any extravagant expenditure was incurred by the Secretary of State, it would be the duty of the Secretary at War to concur with the Treasury in opposing it. He (Lord Monteagle) did not know how that principle of control or check could now be worked out. Was his noble Friend (Lord Panmure) to control himself, for he saw no other control provided. Upon coming into office, under Lord Grey's Administration, he and his noble friend opposite (Earl Grey) found that, according to the old system, large Votes had long been annually taken under the colour of Army Extraordinaries, which Votes, practically speaking, were at the disposal of the Treasury for any possible object, and had been at times most irregularly applied; as an example, they found, to their astonishment, that the bishops of the Established Church in British North America were paid out of that Vote. The result was that shortly after, in Lord Melbourne's time, those army extraordinary Votes ceased. But there was a question of importance which remained connected with the Commissariat, even after the withdrawal of the extraordinary vote. Then there was a sum of upwards of 1,000,000l., which constituted what was called the Commissariat chest account. That was an unappropriated sum of money, which was used as a banking deposit to enable the department to make advances for the public service, for the army, the navy, and Ordnance; such advances requiring to be repaid out of the Parliamentary Vote. The Commissariat, in its banking and financial functions, recruited the military chests. A more difficult task than to prevent misapplication of any of these advances, and to secure their accurate repayment, did not exist in any department of the civil service. But that was not the only duty of the Commissariat. The officers of that department were distributed all over the world—they had to provide funds for the public service—they had to purchase bullion—they had to draw and negotiate bills for the Treasury, and in all respects to act as bankers. These were functions with which a Secretary of State for the War Department had no necessary connection, nor had he the means or the knowledge of exercising a control. It could only be safely exercised by the Treasury, the supreme financial department of the State, the department bound to accept the Commissariat bills, and to provide funds for their liquidation. He believed the number of persons abroad authorised to draw bills on the Treasury was larger at the present moment and was more dispersed than ever it had been. There were agents purchasing supplies everywhere, and they all had power of drawing on the Treasury; and bills were drawn from Spain and Bagdad, from the Crimea, throughout Asia Minor and Damascus. Are all these agents to be placed hereafter under the Secretary of State for War? Are these bills to be paid and these financial operations to be carried on under his responsibility? There was no authority whatever for so dangerous a system. In the Duke of Richmond's draft Report it was stated— The Commissariat there can be no difficulty in joining with the other departments; but, in doing so, it must not be lost sight of, that it is through the departments abroad that all the other departments in the Colonies and stations are supplied with money in the first instance. It is through them that the Treasury is enabled to check all extraordinary expenditure; they may be considered the bankers of all other departments; they regulate the currency in the Colonies, and order occasional payments, altogether unconnected with army expenditure. Care must be taken not to destroy any of these checks to which we have previously alluded, or impair, in any degree, the control which the Treasury exercises over every extraordinary expenditure. And the subsequent Commission, of which he (Lord Monteagle) was a Member with Lord J. Russell, Lord Grey, Mr. Ellice, and the late General Sir J. Kempt, had also reported to a similar effect. They said— We are strongly impressed with the belief that the financial transactions of the Commissariat ought to be kept distinct from the management of the expenditure of any one branch of the service; and, if it should be found that the business could not be conveniently transacted by means of distinct officers employed directly under the Treasury, we think it might be arranged that the Commissariat should, in all that relates to their general banking business, correspond with the Treasury, and act under its orders, while they furnish their supplies under the Secretary at War. The only further authority which he would quote was the more recent one, the noble Lord opposite (Earl Grey), who, in a speech delivered during the present Session; had said— I cannot understand how a department of business (the Commissariat), involving so much detail and so many matters of finance, can be conveniently dealt with in an office constituted like that of the Secretary of State. I certainly think it a description of business that would have been more; properly united to departments which are more conversant with pecuniary transactions and with matters of detail. He contended that the financial transaction of the Commissariat should be kept wholly distinct from its military transactions. He believed that if, in time of war, left this department under the sole authority of the Secretary at State, they would have to complain of an undue expenditure, and they would make a sacrifice of financial accuracy and security. In the remarks he had felt it his duty to make, he hoped he had not uttered a word implying the slightest distrust of his right hon. Friend the Chancellor of the Exchequer, who, in his opinion, had shown a wise and excellent judgment in his general financial arrangements, nor yet of his noble Friend (Lord Panmure) he hoped; he believed that he had not uttered one word that could give them any pain, but his object had been to bring under their observation and that of the House, matters which, in his judgment, demanded early and most serious attention in order to guard against great and pressing dangers.


My Lords, I should not have risen to address your Lordships were it not for the reference made in the speech of my noble Friend who has just resumed his seat to the Turkish loan. No doubt the Convention through which that loan was raised, between this country and France, is one of the most important financial operations of the Session; still it is not for the purpose of discussing its merits that I rise to say a few words. My Lords, I very much regret I was not present in my place when the discussion took place upon the subject; because it was with great surprise and pain that I read the accusation advanced by my noble Friend the Secretary of State for Foreign Affairs, when he stated that the party occupying these (the Opposition) benches, as well as that portion of the same party having seats in the other House of Parliament, had treated this question as if they doubted the honesty of France and the honour of the French Emperor. My Lords, I think that great man knows sufficient of this country to estimate the value of party accusations against political opponents. He has lived long enough amongst us to know that what may be uttered on either side of the House in the heat of debate is widely different from the language and conduct of the same persons elsewhere; and certainly I never saw an instance in which that truth has been more clearly verified than when my noble Friend the Secretary for Foreign Affairs rose in his place and accused the Opposition of suspecting the honesty of France and the honour of the Emperor in relation to this Convention. But the sacred horror which my noble Friend felt at the danger of the Convention being stultified by a division in the Upper House of Parliament made him forget what took place when I had the honour of holding the office which he new conducts with so much ability. Let me remind your Lordships, but above all let me remind my noble Friend the noble Marquess (the Marquees of Lansdowne), for he is more particularly Concerned, that when I had the honour of being Secretary of state for Foreign Affairs, I found before me in the Foreign Office a Convention that had been drawn up and completed by the Government which preceded ours—a Convention between England and France relating to the extradition of offenders. That Convention had already been agreed to, and I made no alterations in it except to liberalise it in some respects. Now, what took place with reference to that Convention? When the matter was brought under your Lordships' consideration, I will not say my noble Friend (Earl Granville)—who immediately preceded me at the Foreign Office—actually opposed it—though he remained during the discussion in solemn silence, and did not in the slightest degree offer me any assistance in defending it. But certainly those who had been the colleagues of the noble Earl—and most especially the noble Marquess (the Marquess of Lansdowne), most violently opposed the Convention; and it was quite in vain that I urged on them the Convention had been signed and ratified. And what was their argument? Did they at all cast suspicions upon the honour of the French nation and the French Emperor? Why, they said that if the Convention was ratified by Parliament the French Emperor would use it to get hold of some of the political refugees in this country. Yes, my Lords, such was the excuse alleged for the non-acceptance of a Convention already ratified between the two Sovereigns, and by the very men, and by the same party who now throw in the teeth of noble Lords on the Opposition side of this House and their Friends in the other House of Parliament, that they have taken an unusual course in attempting to oppose or stultify any treaty, and who cast on us the stain of doubting the good faith and honour of the Emperor of the French in the strict observance of treaties.


Really the noble Earl and other noble Lords are quite under a misapprehension on this subject. I never made any such accusation against them. What I did say was, that some of the arguments used elsewhere in discussing the Turkish loan treaty would seem to throw a doubt upon the honour and say that any one did or could entertain a doubt of the honour of France, but that the arguments used might be construed to imply a doubt.


My Lords, I am extremely glad that I have taken an opportunity of referring to this subject, because I believe your Lordships cannot be too often occupied in repeating the unanimous feeling of confidence which pervades the nation in the high honour and integrity of France and her Emperor. But what I wished to impress upon your Lordships—in the absence of the contradiction by the noble Earl—was the unfairness of such an accusation coming from those who, when I had the honour of holding the seals of office, prevented me from supporting by an Act of Parliament a Convention that had been signed and ratified between the two countries. As I have already intimated to your Lordships, I now repeat, I was always impressed with the importance of the Convention, and I thought Parliament ought to be most careful before it stultified an act of such importance as a Convention signed by two Sovereigns. I am certainly much gratified to hear my noble Friend's denial of to-night, and I can assure him that I should not have alluded to the subject were it not for what I saw stated in the newspapers, confirmed as that was by remarks in private conversation.


thought the explanation of his noble Friend (the Earl of Clarendon) would have been unnecessary if the noble Earl (the Earl of Malmesbury) had himself been present when the former discussion took place. With regard to the Convention which the noble Earl had moved when he held the seals of the Foreign Office, he could hardly reconcile the noble Earl's charge against him now, for being so solemnly silent, with his compliment then, for the striking contrast his conduct afforded to the conduct of his Friends upon that occasion. With regard to the Turkish loan, he had never reproached the noble Lord (Lord Monteagle) for bringing the question forward. He should never complain of any Member, of either House, pointing out every possible objection to such a treaty, and warning the House of any dangerous consequences which might flow from it. Whether it was justifiable for a party—feeling unable to turn out the present Government, but professing to support them in the most vigourous prosecution of the war—to join with those of an entirely opposite opinion, and thereby run the risk not only of enfeebling the Government, but diminishing the means of assisting Turkey and endangering the good understanding between this country and France, which up to the present time had been maintained with remarkable honour arid good faith, was quite another question, and into that question he did not wish to enter. His noble Friend (Lord Monteagle) had alluded to that passage of his (Earl Granville's) speech in which he humorously described himself as a buffer between the noble Lord and the right hon. Member for the University of Oxford, His right hon. Friend Mr. Gladstone, had complained to him of the simile if it were intended to imply two bodies actively in collision, because he denied that he was a party to any collision with the noble Lord. In this matter of the Turkish loan their opinions did not appear to accord, and he would again entirely decline acting as a buffer between the noble Lord and the right hon. Gentleman. He would not enter upon the ground which the noble Lord had travelled over, but he would merely say the object of the Government, in putting in the alternative of Exchequer bonds, was to secure any advantage which had be obtained from their becoming more and more a favourite security with the public. With regard to the military question he should of course abstain from giving any opinion. It was impossible to deny that, for her great resources the country was much indebted to the revision of taxation which had taken place, and, as to any reductions which might hereafter be effected, he only hoped, when they luckily arrived at a time of peace, no unnecessarily large establishments would be kept up, but at the same time that the reductions, would be carried out in such a manner as to maintain the efficiency of our establishments.


remarked that the noble Lord had referred to the Convention with France as to the extradition of prisoners; and he might say that no blame at all attached to the noble Earl (the Earl of Malmesbury). In reference to that matter it had turned, out that that Convention, without any blame to the Government, was contrary to our law, and could not be carried into effect constitutionally. He was convinced on that occasion that it would be highly impolitic to pass an Act which would subject political refugees to be treated as criminals.


My Lords, as the subject of the Turkish loan has been referred to. I cannot avoid taking this opportunity of expressing my opinion of the great impolicy of the Convention which has been entered into with France and Turkey. Without imputing the slightest suspicion of the French Government, without implying the smallest distrust of the honour and good faith of our ally, I submit that the form of the Convention is singularly calculated to lead to future difficulties between the two countries, to disturb that good understanding which now happily exists, and to throw on this country a financial burden much heavier than we are now led to expect. This is an arrangement which is to last for a long course of years, and will not be completed until probably all who have contributed to carry it into effect will have either ceased to take a part in the management of affairs, or have ended the term of their natural existence. We are, in the first place, made responsible for the whole interest of the Turkish Loan if Turkey does not pay, and I conceive no man in his senses believes that the Turkish Empire will be in existence forty years hence, or that there is the remotest chance of our not being called upon to pay the interest which we have bargained to pay. When we have paid that interest, it will be for us to call upon France to reimburse us her proportion. But, looking at the future, many changes may take place, and many questions may arise between the two countries which are now upon the best possible, terms. Having some supposed set-off, the French Government may claim the right of withholding that payment; we, on the other hand, not admitting any such right, may insist on being reimbursed, and difficulties may arise between the two countries. We have examples in our own history how little those who conclude arrangements of this kind can foresee what may happen in the course of a very few years. Your Lordship cannot forget the circumstances of the Russian-Dutch Loan. We all remember how this country guaranteed that loan. We also know that the honour of this country stands deservedly high, and that no party will ever sanction any course of proceeding Which is not Consistent with good faith; yet within fifteen years after we had entered into that convention there was the greatest difficulty in inducing the House of Commons to enable the Government to keep up the payments on the loan we had guaranteed, on the ground that circumstances had arisen which made a very numerous party in this country argue we were no longer called upon to continue our payments on account of the Russian-Dutch Loan. Those who remember the circumstances are aware that the Government were scarcely able to maintain the arrangement in the House of Commons.


said, his father, who was Attorney General at the time, expressed his opinion that the rapture between Belgium and Holland did not in any way affect our obligation, and that good faith required the payments should not be interrupted; those payments never were interrupted, and had always been made in due course.


The statement of the noble Baron confirms my argument. He states truly, that his respected father gave an opinion, the soundness of which no one can doubt, that the obligation of this country continued binding. Notwithstanding that high opinion, it was with the utmost difficulty that the Government were able to maintain in the House of Commons the obligation of continuing the payments. Nothing but the positive declaration, that the Government would not consent to hold office if they were defeated, coupled with very great exertions on their part, enabled them to maintain that arrangement in Parliament. If such doubts could arise in this country within so short a period, was there anything which savoured of disrespect to France to contemplate that twenty or thirty years hence the Government which might then exist in France could not contend that some circumstances had occurred to relieve them from the obligation, and would not decline to pay their share of the loan, leaving the burden upon us? These circumstances are not only possible, but probable. The whole system of guaranteeing loans for foreign countries is one that experience has taught us it is desirable to abandon. A loan is, indeed, a subsidy in disguise, and I had much rather that the Government had given the money to Turkey at once and openly. It is true we are told, "It is only your name that is wanted; the obligation will never fall due; the resources of Turkey are so ample that the use of your credit is all that is wanted." This is the language addressed sometimes to young gentlemen by their seniors who wish to prey upon their ignorance and credulity. They say, "There is no difficulty about getting the money, but the money-lender likes to have some security; it is only putting your name upon the back of the bill; it is a mere form, and does not signify anything." Too often the young gentleman afterwards finds that it would have been far cheaper to give his assistance to his friends by a direct gift or loan than by the mode of backing a bill. The Government has taken a similar imprudent course with regard to Turkey, and I fear it will be followed by the same results. I believe that, out of all the millions which this country has voted in subsidies, not one of those subsidies has been followed by the advantages which this country has expected from them. Still, if we are to have subsidies, let us have them in a plain and straightforward manner, and not subsidies in disguise. If you give your money, you may take some security that it was be devoted to the purposes for which it was intended. If you say you will pay the bills, you may send your own officers to see that the money goes to the soldiers and to the merchants who supply provisions for them, and your object will then be accomplished. But if you only give security for Turkey, you cannot, without setting aside her independence as a nation, prevent her from having the control of the money. Your Lordships know the present state of that most corrupt of all Governments, the Turkish Government, and that it is notorious that, of the money which ought to go into the Turkish Treasury for public purposes, no small proportion goes into the hands of corrupt pachas and griping money-lenders. Your Lordships well remember the distressed state of the Turkish army in Asia last winter. By the concurrent testimony of all the newspapers, the state to which the army was reduced was, not because Turkey had not a sufficient sum of money where with to pay the men, but because the funds had been the subject of unbounded peculation. In all countries there is a disposition to extravagance in the expenditure of the Government money, but in a country like Turkey that extravagance and peculation it is impossible to check. I did not intend to advert to this subject, but it has been incidentally raised by my noble Friend. Before I sit down, as the Bill before the House, provides another loan of 7,000,000l., it is impossible for me to for-bear expressing the alarm and regret with which I have received, this proposal for an additional loan. My Lords we have already sanctioned a loan of 16,000,000l.; then there is the guarantee of the Turkish loan, which, in the most favourable view, is equal to another loan of half the nominal amount, 2,500,000l.; then there is the 7,000,000l, which the Government are now authorized to raise—making a total of 25,500,000l., of borrowing which Parliament has sanctioned in a single Session. My Lords, I for one look with the utmost dismay on such draughts upon the resources of the country. My noble Friend (Lord Monteagle) has already called attention to the enormous amount of our present expenditure, for, in addition to these loans and our largely increased taxation, the expenditure is going on at a rate that is truly frightful. It is impossible for an expenditure of this amount and for this vast borrowing to go on long without the most serious results—results that will not end with the war, but which will remain, for a long day after the present war has terminated, to press severely upon, us My Lords, among the ill effects of this enormous expenditure which has been largely met by borrowed money, the worst is the moral effect upon the people of this country, and there are already unmistakable signs that there will be found in this country the same consequences that have been invariably produced by the same circumstances in other countries and other times. My Lords, when either individuals or nations are engaging in a large expenditure, which is partly defrayed by loans, there arises a spirit of profusion and a neglect of all wise economy which leads to the most fatal results. Your Lordships cannot look with attention on what is going on around you without seeing that this is taking place as the result of the large national expenditure. Apart from all questions of the policy of the war—if I could agree that the war in which, we are engaged is politic and necessary, and if I agreed—as I heartily do—that, having engaged in it, it should be carried on with the utmost possible vigour, still I see, unmistakable signs that it is being carried on without that due regard to economical, consideration which should direct those who are charged with the management of affairs:—on the contrary, I am persuaded that a spirit of great extravagance has prevailed, and that the same real amount of service might have been attained at far less cost if the money voted by Parliament had been judiciously expended. I do not altogether blame the Government for this—the blame partly rests with the Houses of Parliament—but the bad effects of this profuse war expenditure and the excitement that war creates are that they produce in the nation a general spirit of disregard of all considerations of economy. The House of Commons, which ought to be a check upon the Government and prevent the public money being wasted, seems, on the contrary, to have no other duty than to call for the most unbounded expenditure, and to vote without inquiry any enormous sum that may be asked for. It is the same with individuals. Every person connected with shipping or commerce of course is trying to make as much as possible out of the Government by the commodities which they supply, or the facility which they afford by the use of their vessels. In other respects this profuse expenditure is producing a corrupt and demoralizing effect upon the national character that is attended by the most fatal consequences. My Lords, it does in my opinion, become us and the country to consider what is the present state of the world, will be the ultimate effect of this system upon the future power and welfare of this country. My noble Friend has alluded to the enormous accumulated resources which have been husbanded during a long peace. Your Lordships will remember that when peace comes again, all these demands upon the public exchequer, which we are now recklessly incurring, will have to be provided for; that there will be the interest upon these loans to be met, and a heavy expenditure upon the reduction of your warlike and military armaments. You cannot go back after increasing your establishments to this enormous extent to where you were before, for personal claims and vested interests will be created which it would not be just to disregard. You must be prepared, my Lords, to look at these questions, and, whenever peace comes, the duty of adapting your establishments to the altered state of public opinion will be one of immense difficulty; but this is not all. At the very time these demands are made upon you the nation will have become impatient, and we may then see a reaction from the present temper of extravagance to a disposition to make over-hasty and imprudent reductions. That is the more probable because the Government seem to have entered upon that most mistaken policy of embarking upon a large expenditure during the time of war for particular purposes unconnected with the war. I have already pointed out the impolicy of expending large sums of money upon fortifications and barracks at home which cannot be wanted during this war, and which are not likely, according to the system pursued, to be done in a proper manner. When the time comes that this reaction shall take place and when injudicious reductions shall be called for, this House will have the most difficult question to consider, how to relieve the people from the pressure of taxation? Your Lordships will remember that the state of the world is much altered from what it was in former days. Already a great stream of emigration is setting out—an emigration not only of the best of the population, but of those men who carry with them no inconsiderable portion of the national wealth. If your taxes press too heavily on productive industry you will artificially increase that tendency to emigration, by rendering it difficult for men to live at home, and thus you will injure the very sources of your power. The same effect will be produced upon your trade. In the present state of the world, with active rivals on the other side of the Atlantic, with the competition of your Colonies to contend against, you cannot, without injury to the vital sources of your power, impose taxation upon trade and industry beyond a certain amount; and therefore, when peace returns, you will find, if this system of loans is carried much further, that you have inflicted a most irreparable injury upon the nation. I hope that these things will be considered not only by your Lordships but also by the public, and that there will be a general desire to prevent the continuance of this system of enormous expenditure and ruinous loans.

Motion agreed to; House in Committee accordingly. Bill reported, without Amendment: and to be read 3a on Monday next.