Lords Sitting of 11 December 1857

MINUTES.
3a Bank Issues Indemnity.
ALLEGED REVIVAL OF THE SLAVE TRADE-THE FRENCH COLONIES.

  QUESTION.
  THE EARL OF SHAFTESBURYsaid, seeing his noble Friend the Secretary of State for Foreign Affairs in his place, he would ask him a question relative to the state of the contract supposed to exist between a house in Marseilles and some African chiefs for the supply of free emigrants to the French colonies. It had been reported that this contract had been ratified by a decree of the Imperial Government, and the people of England were fearfully alive to the probable, nay, almost certain revival of the horrors of the African slave trade. He wished to ask how far this report was true; whether, if the decree had been issued, there was any hope of its revocation, and generally what was the position of the whole matter?
  THE EARL OF CLARENDONsaid, in answer to the questions of his noble Friend, he had to state that he had no reason to believe that the decree to which his noble Friend alluded had been issued; but he believed there was no doubt that a contract had been entered into by the French Government and a certain firm for the supply of negroes to the French colonies, which only received the sanction of the Imperial Government on

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  condition that it was to be bond fide a free emigration. That the condition thus imposed, and which he was sure had been imposed by the French Government in perfect good faith, should be fulfilled was perfectly impossible. There could be no such thing as a free emigration from Africa. We ourselves had tried the experiment sixteen years ago, and with every precaution and every safeguard to prevent abuses, so as to secure the freedom of the African labourer on his passage, and his proper treatment while employed in our colonies, as well as to guarantee his return home at the expiration of his engagement if he wished it. Notwithstanding all these safeguards the plan utterly and entirely failed, and it was not likely that it would ever succeed under any circumstances. But this was what the French contractors were compelled to do. They engaged with the African chiefs to supply a certain number of slaves at so much a head, who were placed on board of ship, when a certain formality was gone through, with the view of ascertaining whether they were willing to work at stated wages, and for a limited time, in the French colonies or not. Now, whether the negroes understood that question or not, it was manifest that when once on board of ship they had no choice in the matter. Besides, the result was, that by this system the French contractors were brought into competition with the regular slaveholders, who offered ninety dollars a head for slaves, while the French contractors had only the power to give fifty dollars. There had in consequence been a failure of the contract; but that in no way altered the character of the transaction, because if slaves were to be procured at all, it must be by purchase, and they could not be obtained unless the chiefs kidnapped negroes or made war upon their neighbours, it being, of course, a matter of utter indifference to those chiefs whether those slaves, whom they sold to the highest bidders, were manumitted after their arrival in the French colonies, or whether they were worked to death. The wars carried on with that view were of the most barbarous character, and caused great loss of life. Whole districts were depopulated, and not one-half of those captured survived the sufferings they met with on their way to the coast. The French contractors said that it was an act of huma-
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  nity to the negroes themselves to give them that opportunity of emigrating to places where they could be profitably employed; but in point of fact it was the knowledge that there were purchasers that placed them in that position. But he would remind their Lordships that it was putting a stop to the legitimate and prosperous trade which within the last few years had sprung up on the coast of Africa in almost every locality in which the slave trade had been carried on, and by which the natives of Africa were greatly benefited. In the spring of this year he (the Earl of Clarendon) received two despatches on this subject, which were of such great interest and contained such full and valuable information as to the trade in palm oil that he did not wait to have them published in the regular course, but laid them at once upon the table of their Lordships' House. Since that time he had ascertained that the trade at Lagos in palm oil had increased 50 per cent, and now amounted to upwards of £2,000,000 a year. But the whole of this rising trade, and this increasing prosperity to the Africans was now threatened with destruction if this system were carried on. There were now extensive preparations for war being made in all the countries from which the slaves were brought, and as the matter was one of so much interest and importance he would read a very short extract from a despatch which he had received from Mr. Campbell, the Consul at Lagos. Mr. Campbell, at the beginning of September last, wrote, in allusion to the contract of M. Regis, that,—
  "Unless the intention of purchasing slaves at Whydah is abandoned we shall have the whole of the Youraba country plunged into warfare to supply the demand of the slave market at Whydah. The example of the people of Abcokuta is to be followed by the people of Ibaddan, who are preparing to attack the Jaboo country, and, as a preliminary step, several Jaboos peacefully attending the market at Ibaddan have been seized, some put to death, others sent to Why-dab, for sale, and all intercourse between the two countries has been stopped by the closing of the paths and roads, and if the speculation of M. Regis is carried out it will be followed by other countries."
  But the people of that country had during the last thirty years acquired such a taste for industrial pursuits, and had become so much alive to the advantages arising therefrom, that it was with the utmost reluctance they were now induced to engage in wars, while formerly every

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  man was eager for strife and plunder, and the chiefs were now actually compelled to suspend all trade, and to deprive the people of all means of livelihood, before they could induce them to engage in hostilities. In order to prove that fact, he would read an extract from a proclamation issued by the chief of Abbeokuta:—
  "1. In order to procure a large army for the Albo war, soon to be undertaken, trade must be stopped now, and during the war nothing must be sold and nothing bought.
  "2. In order to this the passengers by land and the river to Ijai, Ibaddan, Lagos, and other adjacent towns that trade with Abbeokuta must be stopped.
  "3. No canoe shall be allowed to appear in the river, excepting the missionaries', who are no traders.
  "4. That instant death on the spot be the penalty inflicted upon violation of any of these rules."
  It was not necessary to enter into further details, but he thought he had said enough to prove that the Government were alive to the dangers of any such scheme as had been alluded to. It would, therefore, be readily understood that they had felt it their duty to bring the matter under the serious consideration of the French Government, not doubting that that Government felt an equal abhorrence of any attempt to revive the slave trade, and also not doubting that although no convention existed at this moment between the two countries, yet that the French Government would feel itself bound to act upon the spirit of the Declaration made by the great Powers that the slave trade should exist no more in any of their colonies, and that they would prevent their subjects from engaging in it directly or indirectly. The British Government told the French Government that they believed the latter had proceeded on erroneous information, and only required to be put in possession of facts to be induced to put an end to a system, which, however benevolent in intention, must inevitably lead to great danger of a revival of slavery. The answer of the French Government had been, that while they fully admitted the engagement to discourage slavery to be binding upon them, yet they did not consider the steps which were in progress to obtain a supply of free labour for their colonies constituted any violation of that engagement, but that, on the contrary, it was an act of humanity to procure that labour in
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  an honest and open manner, which otherwise would be procured with all the horrors of a clandestine slave trade. At the same time the French Government desired that there should be no abuse of the system, and they would take into their serious consideration the representations which had been made to them by Her Majesty's Government, in order to stop any inconveniences which might arise. The French Government also admitted that, although there was no treaty between themselves and this country, yet they were bound to act up to the spirit of the Declaration of the Congress, and that they were now as anxious to put an end to the slave trade as they were in 1815. That Declaration was so short that he (the Earl of Clarendon) thought it would be useful at the present time to recall its terms to the public mind. The Declaration of the eight Powers in 1815 was,—
  "That the Plenipotentaries assembled at this Congress cannot do greater credit to their mission, better fulfil their duty, and manifest the principles which actuate their august Sovereigns, than by endeavouring to carry this engagement into effect, and by proclaiming, in the name of their Sovereigns, their wish of putting an end to a scourge which has so long desolated Africa, degraded Europe, and afflicted humanity. Consequently, &c that the engagement reciprocally contracted in the present Declaration between the Sovereigns who are parties to it cannot be considered as completely fulfilled until the period when complete success shall have crowned their united efforts."
  To that Declaration the French Government had expressed its emphatic determination to adhere. He had now stated the actual state of affairs, and thought, after the assurances of the French Government, there was great reason to hope that at no distant day the system which had created such universal consternation among the well-wishers of Africa would be entirely abolished.
  THE EARL OF DERBYsaid, he did not doubt the sincerity of the French Government when they stated their belief that in sanctioning this system they had no idea of a revival of the slave trade. Every one, however, who was acquainted with the subject was fully aware that, as the noble Earl had said, a supply of free labour from Africa was absolutely impossible. Whatever precautions might be taken, with whatever safeguards the system might be surrounded, it would speedily become a slave trade in disguise

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  so thin and transparent that it could deceive no one with the slightest experience. It was well known that in Africa the people had no power to dispose of themselves, and a supply of labour could only be obtained thence either by direct purchase or by the indirect method of enabling the labourer to pay the chief for a licence to quit the country, which, in fact, was a sale by the chief of the man whom he allowed to be taken away to the man who made arrangements to pay for the licence—and that resolved itself into the slave trade. There was only one portion of the answer of the noble Earl which was not perfectly satisfactory, and that was the statement that the French Government, while expressing its determination to adhere to its engagements to suppress the slave trade, still did not consider that the scheme which had been referred to came at all under that denomination, and that therefore they could not feel bound to discountenance it. The noble Earl had not given the House to understand that he had been able to prevail upon the French Government to put an end to the system which was objected to, but only to the extent that they would put an end to all the inconveniences attaching to the system. He (the Earl of Derby) emphatically declared his full conviction that, surround such a system with all possible safeguards, it would be impossible to prevent abuses—that there was no way to put an end to the abuses but to put an end to the system itself. The French Government were deceiving themselves and ignoring the lesson derived from the experience of this country if they did not perceive that the maintenance of the system as it now stood was identical in substance, if not in form, with maintenance of the slave trade itself.
  THE EARL OF CLARENDON: I was extremely desirous, in replying to the question of my noble Friend, not to overstate, and therefore I gave as nearly as possible the words used by the French Government; but I have reason to believe, although I cannot at present venture to state, that the present scheme will be abandoned at no very distant period.
  EARL GREYhoped and trusted that the system which had been brought under their notice would be speedily abandoned, for there was no possibility of dealing with it by halves. He relied fully upon Her Majesty's Government not to allow
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  this matter to sleep. It would of course be improper under present circumstances to ask that the correspondence should be produced; but if, unhappily, the result of that correspondence should be unsatisfactory—a result which he would not for a moment believe possible, for it would be disgraceful to the great nation with which it was carried on—then he hoped the papers would be laid before the House, as the only means which they had of acting upon a great country like France was to publish the whole proceedings, and submit them to the judgment of the whole civilized world. He would only add a few words from his own experience. During the time he had the honour of holding the seals of the Colonial Office the subject of free labour had been frequently brought under his notice. He was urged over and over again by persons connected with the West Indies to permit free labourers to be imported from the coast of Africa. The Government of that day were anxious to do all in their power to relieve the colonies, and agreed to fit out a steamer and make an endeavour to procure labourers. They sent persons in whom they had confidence to the African coast, and adopted every measure which was suggested to them, save one. It was urged that it would be an act of humanity to ransom the unhappy prisoners taken in war, as they would be in a better condition as labourers in the West Indies than as captives in Africa; but he (Earl Grey) always said that it was against the plain principle that "you can't buy stolen goods without sharing the guilt of the thief." Upon that plain principle the Government would not allow a shilling to be given either to the immigrant on board the ship or to the chief on the African coast. Upon these conditions, however, only some twenty or thirty Kroomen were induced to embark, and the result of that experiment was, in his opinion, sufficient to show what might be expected to happen at the present day. He should only add that this was, in his opinion, a moment when especial care should be taken to prevent so iniquitous a scheme as that which was said to have been set on foot from being carried into execution, inasmuch as it would appear from the representations of those distinguished travellers who had recently returned from Africa that civilization was beginning to penetrate into the heart

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  of that great continent—a state of things which it was desirable to foster, instead of promoting a scheme by which the progress which had begun to manifest it-self was sure to be checked. The question was one of the deepest importance, not alone to England, but to the cause of civilization throughout the world, and he therefore hoped that many weeks—nay, that many days—might not elapse before his noble Friend would be in a condition to declare that the Government of France repudiated all connection with the movement upon which it was reported to have embarked.

THE DEBATE ON THE ADDRESS.

  FURTHER EXPLANATION.
  THE EARL OF DERBYsaid, that as that was probably the last evening on which their Lordships' House would meet before the Christmas holidays, he wished to say one word, and he trusted it would be the last, in reference to the extraordinary controversy which had arisen out of the statement made by him on the first night of the Session. In the first place, however, before he proceeded to the particular statement to which he referred, he must correct two inaccuracies into which he had been led in making that statement, although they were not of much importance to the argument he was supporting. He had stated that the first offer made to the Government to send troops across the Isthmus of Suez was made by the Peninsular and Oriental Company. He believed the fact was, that it was made by the European and American Company in July, and was rejected by the Government. It was singular that in the papers laid on the table within the last few days he found a letter from the Governor General, dated August 7, in which he stated that if the Government were not in communication with the Peninsular and Oriental Company, the Government of India were, and that he fully expected that the Home Government would avail themselves of the advantages offered by that route. [The noble Earl read a passage from Lord Canning's despatch, from which it appeared, that, supposing the Government at home might send troops via Suez, he had communicated with the company on the point of bringing them on to India by their steam-boats, and that they had informed him that each vessel would carry 600.] The other inaccuracy
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  into which he had been led was this. He had stated that the time when the offer of the Peninsular and Oriental Company to send troops overland was made was in the latter end of August, whereas he found by a letter from Mr. Willcox that the offer was made on September 6, and accepted September 8. The third question to which he wished to call attention was the much controverted letter said by him to have been written by the President of the Board of Control to the Directors of the Peninsular and Oriental Company. Even up to that moment he was unable to explain the discrepancy which exists between the noble Earl's denial of the accuracy of my statement and the information on which that statement was based. As my noble Friend (the Earl of Hardwicke) stated to the House the other evening, he made to me in November last the statement he (the Earl of Derby) had made to the House. It appeared, however, to him to be so incredible that he took no further notice of it. When, however, he (the Earl of Derby) came to town, he had the same statement made to him in another quarter, and he then began to think that it was necessary to make some further inquiry into the matter, and he then held in his hand the original of the first written communication he received on the subject after he arrived in town. He would rather not mention the name of the gentleman from whom it proceeded: it would probably be sufficient when he stated that he was a gentleman of character and position. The part of it which was material was as follows—
  "When the negotiations were completed, the arrangements all made, and the men getting ready, all having been settled between the Peninsular Company and Captain Sheppard, on behalf of the East India Directors, so little did Mr. Vernon Smith know of what was in progress, that he wrote to Mr. Anderson, to inquire of him whether it would then be possible to organize some such plan as had been already organized and brought into operation without the knowledge of Mr. Vernon Smith, or of the Board of Control. Mr. Anderson told me that in reply he informed him that it not only could be done, but that it had been done."
  He still thought there must be some mistake, and he therefore begged his informant to go to Mr. Anderson and ascertain whether the statement was undoubtedly correct. In reply, he was informed that Mr. Anderson had left England on his way to Egypt, but that his informant would have an opportunity of

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  seeing another director in the course of the day, and would ascertain the truth from him. The gentleman to whom he referred came to him at eleven o'clock on the night before Parliament met and told him that he had seen Mr. Allen, another director, that day, and that he had confirmed the fact that Mr. Anderson had made that statement. He (the Earl of Derby) believed that Mr. Anderson was said to have made this statement not only to the person from whom he heard it, but publicly in various quarters. After hearing this confirmation of the story he (the Earl of Derby) thought himself entitled to make the statement he had done on the first night of the Session. He thought the noble Earl (Earl Granville) did not so absolutely contradict it as to say there could not be any foundation for it, but he gave it such a contradiction as led him to send for his informant the next day, and he then learnt that Mr. Anderson was still in Paris, on his way to Egypt. He accordingly begged his informant to write by that post, and he had now in his possession a copy of the letter which he wrote to Mr. Anderson, stating the contradiction which had been given to his (the Earl of Derby's) statement, and requesting him to mention how the fact really stood. That letter was written on Tuesday, and necessarily no answer could yet have been received; but it was remark-able that, although Mr. Anderson was in Paris at the time when the report of the debates reached him, and had written over to England after seeing the statement which he made in Parliament, he had not in the slightest degree repudiated the allegations he made. Mr. Anderson now appeared to have left Paris and gone on his way to Egypt. He had, however, in his hand a letter from Mr. Allen, which he received yesterday, but had retained until that day, expecting that a reply would be received from Mr. Anderson. In the letter from Mr. Allen, that gentleman stated that Mr. Anderson was under the impression that after the arrangements for sending troops by the Suez route had been made, the right hon. Gentleman the President of the Board of Control wrote to make inquiries of the Peninsular and Oriental Company as to the possibility of making them; hut he added that from subsequent inquiries, made at the office of the company, coupled with the declaration of Mr. Vernon
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  Smith, he (Mr. Allen) "had no hesitation in saying that there must be some misapprehension on the point on the part of his colleague." Thus, while this gentleman intimated his belief that there was a misapprehension on the subject on the part of Mr. Anderson, he recognised the fact that there was an impression on Mr. Anderson's mind that there had been such a communication and answer as had been referred to. He confessed, for his own part, he did not understand how such a thing should be the subject of an impression. A man could hardly be under an impression that he had received and answered a letter; and even supposing the communication was a verbal one, he must know one way or the other whether he had received and replied to it. The statement that there was such an impression on Mr. Anderson's mind vindicated the person on whose authority he made the statement, and who naturally supposed that he had received the fact from a source that could not be mistaken. Mr. Anderson had now gone to Egypt, and any further inquiry must be a matter between him and the President of the Board of Trade. Or, possibly, Mr. Anderson on his return might have an opportunity of explaining the matter before the Committee of the other House, which was about to inquire into the subject. But as the thing stood, and after the declaration of his noble Friend opposite, and the denial of the right hon. Gentleman himself, he (the Earl of Derby) felt, as a man of honour, bound to give the President of the Board of Control the full benefit of his explicit denial, and to express his regret that he should have made a statement which could not but be injurious to him in his public capacity. He believed, however, that their Lordships would be of opinion, not only that he did not make the statement without believing it to be true, but also that he did not make it except after such inquiry and upon such authority as fairly led him to suppose that it could not be successfully contradicted. He repeated, however, again that he now felt bound to give the right hon. Gentleman the President of the Board of Control the fullest credit for his disclaimer, and to assume that some incomprehensible misunderstanding must have led to the statement which was made to him, and which he repeated.
  EARL GRANVILLEsaid, that he was

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  from the first quite sure that any misstatement made by the noble Earl was perfectly unintentional on his part; and after what he had stated the other night, and again that evening, he (Earl Granville) was quite ready to admit that the noble Earl had apparently ample ground for making the statement he did. The noble Earl seemed to have made several inquiries, the answers to which were of such a nature that he might have well believed they were true, and correctly represented the facts of the case. At the same time he (Earl Granville) was prepared to deny that there was any truth in the statement. When the noble Earl made the charge against his right hon. Friend, he (Earl Granville) might have contradicted it at once, but not exactly in the decided manner he could have wished to have done; but seeing his right hon. Friend (Mr. Vernon Smith) at the time in the House, he sent a message to him asking him whether the statement made was true or not. The answer he received was, it was not true. Of course thereon he contradicted the statement; but in consequence of the extreme positiveness of the noble Earl's manner, and the positive face he put upon it—knowing too how often and how easily mistakes and misunderstandings arise—he did not contradict it so decidedly as he might have done, but contented himself with a simple denial of the charge, and refrained from making any violent assertion. Since then he had seen his right hon. Friend, who told him that he had not the slightest recollection of having written such a letter, or of having received such a reply, as were stated. He had also questioned his private secretary and the Secretary of the Board of Control, with the same result. His right hon. Friend had then, he believed, placed himself in communication with the secretary of the Peninsular and Oriental Company. That functionary had also expressed himself wholly ignorant of this alleged correspondence. The gentleman, therefore, whose name they did not as yet know, had furnished the information which, he said, he had received from Mr. Anderson, who was now abroad, and upon which the noble Lord opposite had founded his statement. The noble Earl said that this person had gone to Mr. Allen to obtain corroboration of what he had stated, that he had returned from that
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  gentleman and said Mr. Allen had informed him that it was all correct. Such a statement was somewhat extraordinary, inasmuch as it was in direct contradiction to Mr. Allen's version of the affair.
  THE EARL OF DERBY: I beg the noble Earl's pardon. I did not say that this gentleman stated that Mr. Allen had declared the information to he perfectly true, but that Mr. Allen knew that Mr. Anderson had made such a statement.
  EARL GRANVILLE: Therefore, when all the reasons were given, he felt it impossible that this letter could have been written, or the alleged reply have been given. Under all the circumstances of the case, he must protest against his right hon. Friend the President of the Board of Control having imposed upon him the burden of taking any further steps in the matter to clear his character, because the gentleman who gave the information, and whose name they did not know, was now bound to substantiate his case if he could. Having said thus much, he begged to acknowledge the courteous and cordial manner with which his noble Friend, in the most honourable manner, had acknowledged his own inability to substantiate his statement, and expressed his regret at having, under such circumstances, made the statement so injurious to the official character of the right hon. Gentleman. He begged to thank the noble Earl for that acknowledgment.

BANK ISSUES INDEMNITY BILL.

  THIRD READING—BILL PASSED.
  Order of the Day for the third reading read.
  LORD STANLEY OF ALDERLEYsaid, their Lordships had been already informed in the Speech from the Throne of the reason why Parliament had been called together at this unusual period of the year, and the subject-matter of the Bill of which he was now about to move the third reading. Under these circumstances he would endeavour to state briefly the effect of the law as it at present existed respecting the Bank of England and the currency. Previously to 1844 the Bank of England, the country banks, and the banks of Ireland and Scotland, were empowered to issue any amount of notes, without any condition except that of their convertibility into cash. The consequence was,

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  that during that period many inconveniences resulted; great disturbances took place in monetary and commercial affairs. It was felt that an alteration was required, and Sir Robert Peel, in 1844, introduced that Act which at present governed our banking operations. Its main provision was, that the Bank of England was restrained from issuing any notes beyond the amount of £14,000,000 except as representing bullion actually in the Bank coffers, and this was afterwards practically extended by the sum of £475,000, for the lapsed issues of country banks, which had been discontinued. It was hoped that the passing of this measure, affecting the Bank of England and the country banks, would secure us against the recurrence of those financial convulsions and crises which had previously existed, would maintain a guarantee for the convertibility of paper into coin, and prevent an excess of paper money, with all its injurious consequences. In 1847, however, in consequence (as it was, I believe, generally admitted) of the great railway speculations at the time, and of the large exports of bullion which took place for the purchase of corn abroad, the state of the money market was such that the Government felt it their duty to sanction a departure by the Bank from the Act of 1844 as it affected their issue of paper, in order to preserve the country from grave disasters. The effect of the letter then written by the Chancellor of the Exchequer to the First Lord of the Treasury was such that it at once dissipated the panic and restored confidence, and the Bank did not find it necessary to exercise the privilege thus conceded to them. But though no indemnity was required, the Government felt that Parliament ought to be called together to ask them either to sanction or censure their proceedings. Here he might perhaps take the opportunity of stating what the opinions of Sir Robert Peel were in regard to this Act. Sir Robert Peel on that occasion showed that, though he considered the Act of 1844 likely to guarantee us against an excess of paper, while at the same time it would ensure convertibility, he never thought the Act would prevent a recurrence of those commercial difficulties and financial crises which must more or less exist on particular occasions in any country where credit existed to
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  the extent it prevailed in this country. These were his words:—
  "The Ministers were not wild enough to suppose that this measure would prevent all undue speculation, or ensure an invariable paper currency; but there was a species of speculation dependent on an undue issue of paper which they hoped the measure would check. Speculation could not be prevented in a commercial community, but it might be aggravated by a species of paper credit within the control of Parliament; and though Ministers did not aim at checking legitimate speculation—though they admitted they could not prevent illegitimate speculation, which was perhaps necessarily incident to mercantile enterprise, particularly in a country like this—still they asked Parliament, by assenting to this measure, not to aggravate evils which it could not control, nor refuse to check those which came properly within its jurisdiction."—[3 Hansard, lxxv. 868.]
  Sir Robert Peel also observed (and this would show the views with which he originally introduced the measure):—
  "I say, then, that the Bill of 1844 had a triple object. Its first object was that in which I admit it has failed—namely, to prevent, by early and gradual, severe and sudden contraction and the panic and confusion inseparable from it; but the Bill had two other objects of at least equal importance—the one to maintain and guarantee the convertibility of the paper currency into gold; the other to prevent the difficulties which arise at all times from undue speculation being aggravated by the abuse of paper credit in the form of promissory notes. In these two objects my belief is that the Bill has completely succeeded. My belief is that you have had a guarantee for the maintenance of the principles of convertibility, such as you never had before. My belief also is, that whatever difficulties yon are now suffering, from a combination of various causes, those difficulties would have been greatly aggravated if you had not wisely taken the precaution of checking the unlimited issue of the notes of the Bank of England, of joint-stock banks, and private banks."—[3 Hansard, xcv. 657.]
  Such were the opinions of Sir Robert Peel, and most important they were in considering this question. At the same time Mr. Herries moved a Resolution which expressed the opinion of the House of Commons, that the course taken by the Government of the day was a judicious one. The Resolution was to this effect:—
  "That looking to the state of distress which has for some time prevailed among the commercial classes, and to the general feeling of distrust and alarm by which the embarrassments of trade have been aggravated, it is the opinion of this House that Her Majesty's Ministers were justified, during the recess of Parliament, in recommending to the Bank of England, for the purpose of restoring confidence, a course of proceeding at variance with the restrictions imposed

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  by the Act 7 & 8 Vict., c. 32. That this House will resolve itself into a Committee upon the said Act."—[3 Hansard, xcvi. 803.]
  This Resolution was carried without a division. But a Select Committee was appointed to inquire into the subject, and in their first Report, dated June, 1848,they said:—
  "The issue of that letter was no doubt an extraordinary exercise of power on the part of the Government, but the House has decided that in the peculiar circumstances of the period they were justified in taking that step."
  He would therefore take it for granted that Parliament and the Government were justified in adopting the course they then took. Since that period their Lord-ships had had full opportunity of observing the effects of the Act. It had completely succeeded in its two essential objects—it had completely secured the convertibility of the note, and it had prevented an over-issue of paper. It had not prevented the occurrence of financial crises, but he believed that it was not within the limits of human legislation to frame any law that would effectually prevent such calamities. Situated as this country was, and having transactions with every part of the world, it was liable to be acted upon either by monetary panics or commercial disasters occurring in foreign countries, caused by vicious and unwise legislation, or other circumstances over which our legislation could have no control, for example, as that which had recently occurred in America, where there were unlimited paper issues unchecked by Government control, and without any Government paper in circulation, and where there had taken place disasters that almost led to the total destruction of commercial relations in that country. What occurred in America reacted upon England, a country where there was a well-regulated convertible paper circulation; but the influence it exerted was still more terribly felt in Hamburg, where there was a metallic currency; thus showing that not even a purely metallic currency could protect a country from those periodical distresses that occasionally occurred. It would therefore appear that the crisis through which this country had passed must be attributed to some other cause than that of the state of the currency, as America with her unlimited paper issues, England with her restricted paper issues, and Hamburg with her purely metallic cur
  530
  rency, had alike experienced the severest pressure. "With regard to the recent crisis in this country he might state that though there were difficulties in obtaining money—the rates of discount being high—there was nothing in the commercial position of the country previous to the end of October that at all called upon the Government to take any extraordinary steps. He mentioned this circumstance in consequence of what had been said in another place, that the Government, possessing a department such as that of the Board of Trade, ought to have foreseen what was about to take place, and should sooner have taken precautionary measures. The crisis, the worst part of which he trusted was now over, began with the breaking of the Borough Bank of Liverpool in the end of November, and the failure of the very large house of Dennistoun and Co., followed up by that of the Western Bank of Scotland, which was engaged in very-large transactions with America. The City of Glasgow Bank also failed, and matters assumed a very serious aspect. The consequence was that on the 11th of November it became necessary for Her Majesty's Government to consider what steps should he taken in the monetary condition of the country. Now, if the circumstances of 1847 justified the intervention of the Government of that day, he thought he should be able to show, from a comparative statement of the condition of the Bank of England in that year with what it was in the present, that there was yet more urgent reason for interfering in November last. In October, 1847, the amount of bullion in the Bank of England was £8,313,000; in November, 1857, it was £7,171,000. In October,1847, the reserve of notes was £1,547,000; in 1857, £957,000. In 1847 the reserve of coin was £447,000; in 1857, it was £504,000. In 1847 the private deposits amounted to £8,580,000; in 1857 they amounted to £12,935,000. In 1847 private securities were £19,467,000; in 1857 they were £26,113,000. It must be obvious to their Lordships that if assistance had been refused, and the Bank of England had continued to act upon the law, the most prejudicial consequences must have followed to commerce. Such was the state of things on the 11th of November, and on the 12th the Government, on their own responsibility, and from a full consideration of the emergency of the

  531
  case, issued their letter. The Bank, on the 1lth of November, had 958,000 of notes in reserve, while on the l'2th of November the reserve of notes was only £131,000; so that the necessary commercial accommodation could not have been given, and in such circumstances he left to the imagination of their Lord-ships to conceive what would have been the consequences. He did not believe that any Government that could have existed in this country would have ventured to withhold the suspension of the law for twenty-four hours longer, without producing irretrievable ruin. No doubt the effect might have been to destroy a villanous system and clear somewhat the commercial atmosphere; but instead of Government now meeting Parliament to get a Bill of Indemnity for having infringed the law, they would have exposed themselves to the severest censure for having enforced it. The Bank of England were obliged immediately to act upon the letter of permission to suspend the law transmitted to them by the Government, but they acted upon it merely technically—that was to say, they transferred from the banking to the issue department £2,000,000; on the 12th November.£1,000,000 was transferred, and on the next day another £1,000,000. But the Act of Parliament was only technically violated to the extent of £2,000,000, because in fact the amount of notes actually issued was not at any time to that extent in excess of the £14 500,000. He would read a statement which would show that the increased amount of notes actually in the hands of the public was much below that sum, and that the actual amount of notes in circulation had been very little above what it was before, The excess of notes issued to the public not represented by bullion on the 13th of November was £180,000; on the 14th of November, £022,000; on the 10th of November, £800,000; on the 17th of November, £830,000; on the 18th of November, £852,000; on the 19th of November, £896,000; on the 20th of November, £928,000; on the 21st of November, £617,000; on the 23rd of November, £397,000; on the 24th of November, £317,000; on the 25th of November, £81,000; on the 26th of November, £243,000; on the 27th of November, £342,000; on the 28th of November, £184,000; on the
  532
  30th of November, £15,000. On the 1st of December the number of notes was exactly the same as before the Act had been infringed. Last night (the 10th of December) the total amount of bullion in the Bank was £8,200,000, and the reserve of notes £4,650,000. This beneficial effect had been produced in no small degree by the Government not having given permission to the Bank to transgress the law at an earlier period. He believed that one of the most important provisions of the Act of 1844 was that by which the Bank was induced to raise the rate of discount whenever the exchanges were going against us; by which means the exchanges were righted and gold prevented from leaving the country. On this occasion and before the Government issued their letter the exchange had already taken a turn and the export of gold was checked; while since that time matters had improved and gold was gradually coming in. It would be matter for future consideration how far any future regulation should be made for a relaxation of the provisions of the Act of 1844, but he thought that on no occasion should such relaxation be granted unless the exchanges had already turned in our favour, so as to secure the country against what might prove an aggravation instead of a diminution of the evil sought to be remedied. The Government having, under the circumstances he had mentioned, given its sanction to a departure from the provisions of that Act, they now asked their Lordships to pass a Bill of Indemnity for their act, and to the Directors of the Bank for having acted on that authority. In the Bill there was a provision to which the noble Earl (the Earl of Derby) objected, permitting this departure from the Act to continue for twenty-eight days after the next meeting of Parliament, on the condition that the Bank of England should not charge less than 10 per cent discount; but he thought that the noble Earl misapprehended the effect of that provision, because if during that period the Bank of England should no longer require the protection of the present Bill to enable it to issue notes beyond the amount of £14,500,000 unrepresented by bullion, then it would be no longer required to charge 10 per cent discount. Consequently the Bill was not open to the objection mentioned by the noble Earl the other evening, as its operation

  533
  would cease as soon as the Bank of England felt itself to be in a condition to reduce its rate of discount, and dispense with the protection of the Act. Nor must it be too hastily decided, because the Act of 1844 had been twice departed from, that therefore it was of no value, and might at once be done away with. He thought that experience, so far from proving that the Act was useless and might be abrogated, only showed that the Act was not able to do that which its original introducers never said it could effect; but in other respects it had completely succeeded, in guaranteeing, for instance, the convertibility of the note and in providing also security against over-issues. He should therefore regret to think that any person should be disposed to get rid of this law, merely because the Government had, under unavoidable circumstances, been compelled to depart from a portion of its provisions. Still, it was well worthy the consideration of the House whether it might not be necessary to introduce some new provision with respect to the circumstances and conditions under which such relaxation as had recently taken place should be exercised—whether it should be exercised by the Government on its own responsibility, or by Order in Council, subject to the approval or censure of Parliament, whether it should be effected by some self-operating system, or whether the object could be obtained by some other means. There were also many other matters in connection with this subject which might very properly be submitted to consideration; such as the circulation of the Irish and Scotch banks, and how far their issue of £1 notes had aggravated, if not created, some of the disasters under which the country had suffered. A noble Friend of his (Lord Monteagle) had said that it would be desirable to introduce into Scotland the Bank of England note as a legal tender; and to some extent he believed that such a measure would diminish the extent of the evil which had been experienced—for immediately on the failure of the Western Bank of Scotland all the other banks there sent up to London for gold in order to make themselves safe. The banks in Ireland also sent for gold; and the consequence was that at the moment of the Bank of England's greatest emergency and agony no less than three millions of sovereigns were sent from
  534
  this country to the Scotch and Irish banks. Another point for consideration was how far the stringent publication of the accounts of the Bank of England might have a tendency to aggravate the evils of a crisis. These were all matters worthy for grave consideration and inquiry by their Lordships, as well as the causes of the late financial crisis, and whether the mode in which the joint-stock banks had administered their affairs had aggravated the crisis. He should be glad to see, when their Lordships met after the recess, a Committee of inquiry upon these matters appointed. He had now stated the reasons which influenced the Government to take the course they had pursued. They felt that if it was a justifiable course to take in 1847, it was much more imperatively called for now, and they believed that by the step they took they averted great disasters. They believed that they would not deserve to be in the position in which they had been placed, if they had not, incurring a great responsibility, done that which they alone could do, and departed from the strict letter of the Act of 1844. He trusted that their Lordships would give their assent to the third reading of the Bill which he now moved.
  Moved, That the Bill be now read 3a.
  EARL GREYsaid, he did not rise to oppose the third reading of the Bill. Though he agreed in the opinion expressed on a former evening by a noble Friend near him (Lord Overstone), that perhaps in the end it might have been better that they should have gone through the crisis without the Government assenting to a relaxation of the Act of 1844; he knew that practically it was not in the power of any Government to refuse to take the course which had been pursued; and as that was the case, it followed as a matter of course that assent should be given to the Bill of Indemnity. But, while agreeing to the Bill, he must again call their Lordships' serious attention to the unsatisfactory state in which the laws relating to the currency would be left if they passed the present Bill and did not follow it up promptly by further legislation. He was glad to hear that the views of the Government on this subject had been somewhat altered since the debate on the Address. The President of the Council on that occasion informed the House that the Government

  535
  contemplated no legislation on the subject; but their Lordships were now informed by his noble Friend the President of the Board of Trade that there were several points in respect to which the Act of 1844 might be improved, and that an opportunity for legislation would be afforded.
  LORD STANLEY OF ALDERLEYsaid, that he had not gone that length; he had merely mentioned certain subjects as being deserving of consideration; he did not speak of legislation.
  EARL GREYsaid, he was concerned to find that he had been wrong in supposing from what his noble Friend had said, that the Government were alive to the necessity of further and prompt legislation on this subject, for he (Earl Grey) believed it to be indispensable under the circumstances in which they now stood. He had before endeavoured to convince their Lordships that a second suspension of the most important clause of the Act of 1844 virtually destroyed its authority and moral force. This had become much more manifest since the discussion on the Address. Since that occasion the present Bill had passed through both Houses without opposition, and had been recommended by the Government and supported by Gentlemen of great weight on grounds which made it absolutely impossible for any Government afterwards, in similar circumstances, to avoid acting as the present Government had acted; for it had been laid down that the Government would have been deserving of the deepest condemnation if they had hesitated to take the course they adopted. And further, the present Bill gave not only an indemnity for the past, but contained a provision for the future; for by it Parliament deliberately sanctioned a departure from the existing law for a certain period after the passing of the Bill. He therefore said that after this Bill should have been passed, the Act of 1844 would be virtually repealed, and, if repealed, it was not fitting that it should remain on the Statute-book. It was not becoming to retain a law nominally in force, which it was the avowed intention of all parties to break whenever it should he found convenient to do so. For his own part, however, he objected not merely to this sort of repeal of the provisions of the Act, but he objected to repealing the Act of 1844 at all. He warned their Lord-
  536
  ships against sanctioning the principle that in periods of commercial distress the country might legitimately look for relief to an issue of paper money, regulated by no certain principle, and limited only by the discretion of the issuers and the wants of the borrowers. He maintained that this could not be done without endangering at least, if not abrogating, the standard of value. Their Lordships were told that there could be no depreciation of the currency, and no alteration of the standard of value so long as the principle of convertibility was adhered to. He could neither admit this doctrine to be strictly accurate, nor that if it were so it would justify the conclusion drawn from it. In the first place, he would assert that even with convertibility there might be depreciation of the currency. No doubt convertibility limited that depreciation in point of degree and time, and if the convertibility were maintained the ultimate restoration of the currency would be ensured. For a short time, however, and to a moderate degree, a depreciation of the currency might take place, and, indeed, had taken place, contemporaneously with the maintenance of convertibility. This had been clearly shown by his noble Friend near him (Lord Overstone), who asked what was the measure of the value of money but what it would buy? and pointed out that immediately upon the issue of the Government letter the prices of all commodities rose and the rate of interest fell—in other words, that there was an alteration of the value of money by the act of the Government. Admitting, however, that any depreciation that could take place, so long as the principle of convertibility was maintained, must be moderate in degree and limited in point of time, he wished to ask their Lordships what assurance they could have that they would be able to maintain that convertibility, if the principle virtually sanctioned by the present Bill were acted upon in seasons of distress? His noble Friend near him had stated that it would have been impossible for the Government to take the course of suspending the Act of 1844 if the exchanges had not been in a favourable condition. This was obviously true if convertibility were to be adhered to, because if with an adverse state of the exchanges more paper had been issued, there would have been a drain upon the Bank which would soon

  537
  have exhausted its last sovereign. But when once the commercial world were taught that in all their difficulties they were to look for relief to an extraordinary creation of Bank paper, beyond the issues provided for by the law, did their Lordships think that commercial men would he long content to forego that relief if a period of great pressure arrived when the exchanges were not in a favourable position? Of course they would look for relief, and precisely the same language would be used as at present, to insist on its being granted, though this should involve an abandoment of the convertibility of our paper currency. They would be told that convertibility was only an abstract principle, that an abstract principle must not be allowed to stand in the way of the safety of the nation, that the demand for gold abroad arose from the necessities of other nations, which must not be allowed to bring ruin upon us, and that we must not permit gold to be demanded from the Bank in order to protect ourselves. The very same arguments which were used on this occasion to induce the Government to suspend the operation of the Act of 1844 might be brought forward in favour of a suspension of cash payments. If Parliament once allowed it to be considered a settled principle of our policy that in periods of commercial distress relief should be given by an issue of paper, they could not hope that many years would pass over their heads without a suspension of cash payments. Let their Lordships observe by what few and easy steps they might arrive at that suspension. Suppose another season of commercial pressure to occur while the exchanges were not unfavourable. There would then he a cry that the country wanted money, the precedent now set would be followed, and there would be an extraordinary issue of Bank paper. But suppose that after that issue of paper had taken place, the exchanges should be so affected by this issue or by other circumstances as to turn them against us, a drain of gold would ensue that they could not possibly correct without contracting the issue. But under such circumstances a contraction of the circulation would cause greater difficulty and greater pressure than would have been felt if they had adhered to the principle from the first. Depend upon it they were taking the first step in the downward path towards
  538
  the suspension of cash payments when they allowed paper to be issued arbitrarily and at the discretion of any party. Every step in this slippery descent would be easier, and more difficult to resist, than that which went before it, and a very few steps in it would lead them to a suspension of cash payments. It was now universally admitted that when a suspension of cash payments took place in 1797, it was impossible to avoid it. By previous imprudence on the part of the Government and the Bank in the management of the finances and in the issue of paper money the country had been brought to a situation in which no other course remained—when either the Bank of England must be authorised to suspend cash payments or must he compelled to pay away its last guinea, and then to stop. It was thus the country was brought to that suspension of cash payments which neither the Government nor the Bank had deliberately intended to resort to, and had their Lordships forgotten its fatal effects? They all knew that for a time it did not produce any serious results, hut they also knew that the country having once embarked in the fatal course of issuing paper money which was not convertible into gold, was tempted soon to abuse that power. Men were found to contend then, as they contended now, that when they had good bills they had a right to have them discounted. But while men were contending that there could not be an excessive issue of paper so long as it was issued only in discounting good commercial bills, little by little our currency diminished in value until a guinea came to be worth 37 s. or 28 s., and even more. For a series of years a grievous injustice was thus committed upon all creditors and persons having fixed incomes. And when at length the nation awoke to a sense of the impropriety of the course it had been induced to take, and began to retrace its steps, what happened? It was found that when the currency of the country was again brought back to its former value, those who had suffered from the original injustice very seldom or never benefited by the tardy justice afterwards conceded; while on the other hand, during the years of depreciated currency, an immense multitude of transactions had taken place in which the country, as well as private individuals, had incurred very heavy obligations. The landed interest more

  539
  especially, having made great efforts to meet the demand for com, had borrowed money for agricultural improvements, and they found that they had to pay 20s. for every 15 s. or 16 s. they had borrowed. And so also had the nation, for the national debt was increased in the same degree. Thus a fresh and most grievous injustice was committed when cash payments were resumed, and the nation was suffering to this day, and would suffer to the latest hour of its existence, from the effects of these lamentable blunders. Ought not this experience to be a warning, and ought it not to teach us that if the currency were depreciated, results which no one intended or contemplated would follow one after another, until the country would be unable to right itself? If ever their Lordships were doomed to see a suspension of cash payments, it was by such a road as he had pointed out that it would be arrived at. He had no apprehension that any Minister or Parliament would deliberately and of malice prepense, if he might use the expression, abandon the standard of value, but he was convinced that if in the management of the currency any departure from sound principle were sanctioned, we should sooner or later find ourselves brought into a situation in which it would be impossible to avoid doing so without greater sacrifices than the country would be prepared to submit to. He asked, therefore, whether they ought to leave the road which leads in that direction open for future Ministers and future Bank Directors by passing this Bill and neglecting to adopt some efficient means for reforming our system of currency? How was that reform to be effected? He had no hesitation in expressing his belief that it was to be accomplished by carrying the sound principle of the Act of 1844 to its legitimate conclusion. As he understood that Act, its principle was this—that a paper currency ought to be assimilated as far as possible to a metallic currency. It was assumed, and justly assumed, that while a paper circulation had great advantages in the way of convenience and economy, in point of uniformity of value a metallic currency was superior to any other; and also that the value of a currency, whether paper or metallic, depended in the first instance on its amount in proportion to the transactions which were carried on. It was
  540
  also believed that the uniformity and value of a metallic currency arose from the circumstance that it was impossible arbitrarily to limit its amount. The tendency of the precious metals was to flow into or out of any country where the value had risen or fallen until the balance was restored, and if the value of gold or silver was temporarily altered in any country, it was soon made to conform to its general value in the rest of the world, which was determined by the total amount in existence at the time and ultimately by the cost at which it could be obtained. This tendency was so strong that no law prohibiting the exportation of the precious metals could produce more than a very slight effect in preventing this self-adjustment. These assumptions being made, it followed that in order to make a paper currency resemble a metallic in its uniformity of value, its amount ought to be made to vary according to the varying wants of the country by the same laws and in obedience to the same causes. The object of the Act of 1844 was to create a machinery by which the amount of the paper currency might be thereby regulated, and its uniformity of value thus secured. With this view the Act provided that beyond a fixed sum, far below the wants of the country, no paper money should be issued unless in exchange for gold; and, on the other hand, that paper should at all times be convertible into gold. The effect of this arrangement was, that the circulation could only be increased by the importation, or diminished by the exportation of gold; when the state of the exchange made either operation profitable, it was sure to take place precisely as it does when the currency is purely metallic. But, while that provision was perfectly sound in principle, the Act of 1844, unfortunately, was defective in the machinery by which it sought to accomplish the object in view. It still left the issue of paper money in the hands of the Bank of England and of other banks in different parts of the kingdom. The result of this was mischievous, chiefly from its keeping up a false impression in the public mind. It was supposed that as the issue of paper and the business of banking were still united in the same hands, the former was still intended to be used to facilitate the latter, and that, as the Bank of England had almost a monopoly of the right of

  541
  issuing paper, it was bound in return for that advantage to afford assistance to men engaged in commercial pursuits. It led to a belief that, as the dealers in money were also allowed to be issuers of money, they might always be looked to for assistance on an emergency, and that commercial affairs might safely be carried on upon the presumption that such assistance would be forthcoming when wanted, a notion to which much of the present commercial distress might be attributed. He would not attempt to follow up that topic in the manner he could have wished, and would content himself by saying that, as the principle of the Act of 1844 was to assimilate a paper currency to a metallic currency, it seemed to him that the first thing that ought to have been done was to assimilate the two in the authority by which they were issued. The Legislature allowed no money to be issued by trading persons; there was a Royal Mint only, which was open to all persons who chose to carry gold there to be coined. But to coin paper money was infinitely more dangerous than to coin gold; and, therefore, to carry out the principle of assimilation, what he would recommend was that they should put an end to all issue by the Bank of England, and by the private and joint-stock banks in England; Scotland, and Ireland, and have one paper currency for the whole United Kingdom issued by public authority in the manner suggested by a petition drawn up with great ability, which had been presented that evening in their Lordships' House from the Bristol Chamber of Commerce. By such a change they would do much to guard against the danger that in some of those seasons of commercial distress to which the country was periodically liable, we might be driven to another restriction of cash payments with all its attendant evils. This danger would become much less than he endeavoured to show that it now was, because, when it was provided that paper money should only be issued in exchange for gold by a public authority and not by the Bank of England, that Bank would cease to be regarded as differing from any other trading company. As it would no longer enjoy any monopoly or peculiar advantages from the State, it would be only reasonable that it should be relieved from any peculiar obligations or restrictions. There would be no occasion for
  542
  calling upon it for those returns as. to the state of its accounts, which had been justly said to create injurious alarm in times of pressure; and it would be made obvious to the commercial world that the Bank, having no resources beyond its capital, which it would be the duty of the Directors to manage as might be most for the benefit of their shareholders, could not be looked to for indefinite assistance by firms in distress, and could no more be expected to take measures to support credit (as the phrase was) than any private bank. He would add that, whoever the managers of the currency might be, they should be appointed by the Crown, but should hold their offices, like the Judges, during good behaviour. If he were asked whether that system would prevent the recurrence of periods of commercial distress, and, if not, whether it would be safe to bind the Government so strictly that, even in the most aggravated cases of commercial distress, they should not be at liberty to adopt the usual expedient for its relief which had been twice found efficacious, he would reply, first, that he could not hope that any change with respect to our currency could prevent the recurrence of periods of commercial distress, because it did not appear to him that these difficulties arose from the present state of our currency; on the contrary, he believed the recent pressure had arisen from that restless spirit of speculation which animated the commercial world, and from the abuse of credit which had taken place in this and other countries, and which he could not help thinking some of our recent legislation had been calculated to foster. As to the second question, whether, anticipating the probable recurrence of such seasons of difficulty as we had now and formerly experienced, he considered it expedient that the Government should be debarred from availing itself of a resource which had been found useful, he had no hesitation in expressing his conviction that it ought to be so. He entertained this opinion because he doubted whether the aid of the Government was ever really useful in such case. He believed that in the long run it would be found that the interference of Government and public authority to support commercial credit would be found to do more harm than good. But, even granting that the interference of the State might sometimes be useful, and that it was right to

  543
  recognise the principle that for extraordinary emergencies some extraordinary provision must be made, still, even in that case, he was convinced that no tampering with the currency ought to be permitted. It was clear that the only mode in which the assistance of the Government could be given was by applying the resources and credit of the State in aid of the credit of individuals. No Government could create additional property; all it could do was to transfer whatever there was from one hand to another. If that kind of assistance was to be given, it should be given directly, and not indirectly by authorising the Bank or the managers of the currency, whoever they might be, to issue paper money for the purpose of supplying the means of giving extraordinary aid. It would be better to authorise the Government, under special circumstances, to issue stock or Exchequer bills, as was done in the Revolutionary War. He believed that during the present distress stock had always been high, and there had never been any difficulty in raising money upon stock at a time when bills could not be discounted, which showed that there was plenty of money in the country, but that bills had become discredited. He hoped that some such step would be taken in future, instead of tampering with the standard of value; for the extraordinary issue of paper money not based upon bullion was, after all, only in a different form, the old resource of barbarous and ignorant rulers, the debasement of the currency. It was just as wise to coin little sovereigns as to authorise an issue of paper not based upon bullion. There was another and important point to which he wished to advert, but which it was not possible upon the present occasion fully to enter upon. His conviction, which he had arrived at many years ago, was, that the prohibition of the issue of small notes in this country was a most injudicious measure, and that no reform of the currency would be complete which did not provide for the circulation of £1 notes in England, as in Scotland and Ireland. He could see no reason why, if paper could be usefully and safely employed for large sums, it should not be used also for small amounts; and he had never heard any argument against the use of £1 notes which did not equally apply to £5 and £10 notes. The present was not the
  544
  occasion to discuss that subject, or he should not despair of being able to convince the House that the issue of £1 notes would, instead of rendering the currency insecure, tend to make it more secure than it was at present; and if it could be done with safety it was manifest that it could be done with advantage. They would get rid of the anomaly which permitted £1 notes to circulate in Scotland and Ireland, but prohibited them in England—a law which was quite disregarded in the border counties, where Scotch £i notes were in constant circulation; and upon a late occasion he found himself the holder of some Western Bank notes. If £1 notes were wrong, let them get rid of them altogether; but if they were right, let them circulate everywhere. Another advantage which would arise from the issue of £1 notes was that it would facilitate a change to which he had already adverted—the withdrawal of the existing privileges from the Bank of England and the other banks of issue, and would enable us to have one national currency instead of several currencies managed by several trading corporations. The remarks of his noble Friend (Lord Monteagle) had shown that if there had been one national currency the country would not have been exposed to the great inconvenience which it had lately suffered, arising from the great and sudden demand for gold for Ireland and Scotland. By the issue of £1 notes sensible relief would be afforded to the country at a time when relief was moat needed. Although he believed the present distress had been brought about by great imprudence, there could be no doubt but it was a disaster which pressed heavily not alone on those whose imprudence had caused it, but also upon all other classes of the community. The effects were visible on all sides. They saw that large numbers of workmen were thrown out of employment—that the whole course of trade was affected, and yet they knew that the real wealth of the country was perfectly untouched. There could be no doubt but that an issue at the present moment of £1 notes would be of very great advantage. That paper would displace 30,000,000 or 40,000,000 of sovereigns, and there would be an addition to the national capital of a large proportion of those sovereigns. He thought that was a reason why this subject

  545
  should be taken up by the Government, and that without waiting for further inquiry they should at once introduce some measure for the consideration of Parliament. He would not now enter further upon this important and difficult subject; but he must impress upon the Government the necessity for considering it during the approaching recess, and of being prepared when Parliament shall reassemble to bring forward some measure upon their own responsibility. He was glad to hear that they were to have an inquiry into the causes of the recent distress; he thought such an inquiry would be very useful:—but he did not think it was necessary to make any further inquiry into the state of the currency. There were other causes of distress which might be usefully inquired into, but as to the currency, they might inquire for ten years, and at the end of that time they would not have arrived at the end of all the people had to say upon the subject, nor would they have added one particle to the information they already possessed. The whole facts were before them; they had all the means for forming their opinions; and therefore he insisted it was the duty of the Government not to throw upon the members of a Committee the responsibility of devising a measure of this kind, but to take the matter into their own hands, and present to Parliament a plan which they had maturely considered and carefully prepared.
  Motion agreed to: Bill read 3a accordingly, and passed.
  House adjourned, at a quarter past Seven o'clock, till To-morrrow, a quarter before Three o'clock.