Sitting of 29 January 1807

Minutes.
A ballot took place for a committee to try and determine the merits of the Penrhyn Election petition. The following gentlemen were appointed on the committee:—T. B. Lethbridge, lord Maitland, C. Chaplain, D. Williams, D. Davenport, hon. W. Herbert, sir H. Neale, R. Benyon, W. Orde, G. A. Lee Reck, lord Ebrington, J. A. Wright, J. Lowther; Nominees, H. Leycester, R. Hurst.—Mr. Howard reported from the Tregony election committee, that the sitting members had been duly elected and returned; and also that the petitions of Messrs. Nicholls and Miles were not frivolous nor vexatious.—A new writ was ordered for the borough of Plympton, in the room of sir Stephen Lushington, deceased.—On the motion of Mr. Bathurst, the order appointing a committee to search for precedents of cases of members who had been expelled and re-elected, was rescinded, and a new order made, re-appointing the same committee to search for precedents of cases, touching the expulsion of members, and also of members who, having been expelled, had been re-elected; and to report thereon to the house.

ABOLITION OF THE SLAVE TRADE,
Mr. Wilberforce, in adverting to this sub-
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ject, stated, that the house would remember the Resolution that had been voted by that house in the last session of the last parliament, pledging the house to take measures for the speedy Abolition of the Slave Trade. This resolution, it would be recollected, bound that house to take such steps for the early abolition of a traffic which it declared to be contrary to justice and humanity, as the house in its wisdom should deem proper. It might be thought that those interested in this question ought to have brought forward the measure in the early part of this session; but as a proceeding had been instituted in the other house of parliament for that purpose, he had been induced to abstain hitherto from bringing the subject under the consideration of the house. If that proceeding, however, should be extended to too great a length, so as to preclude the probability of its passing this session, he should, if no more competent person undertook the task, bring the matter forward in that house.
Lord Howickwas happy that the hon. member had mentioned the subject, thinking that the attention of the new parliament could not be too soon directed to it. He thought the hon. gent. acted right in not having brought forward any proposition on the subject, as the proceeding in the other house would tend to the same end. Their own honour, and the honour of the house, was concerned in instituting some proceeding that would lead to an abolition of a trade, which parliament had declared to be contrary to justice, humanity, and sound policy.

NEW PLAN OF FINANCE.
Lord Henry Petty moved, the order Of the day, for the house to resolve into a committee of the whole house, to take into consideration the Finances of the Country: also that the several acts relating to the redemption of the Public Debt, and also the several acts for granting to his majesty certain duties, for a limited time after the ratification of a definitive treaty of peace, be referred to the said committee. The house having resolved itself into the said committee, Mr. Hobhouse in the chair,
Lord Henry Pettyrose, and addressed the committee as follows:—I feel, Mr. Hobhouse, as I naturally and inevitably must, some weight upon my mind, in rising to address you on the present occasion. I feel that anxiety which. the vast magnitude of the subject

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calculated to inspire, but yet from its magnitude and its importance, I derive some consolation, as they afford me a stronger claim upon the indulgence of this committee. I can indeed have no fear that such indulgence will be denied me, when you consider the arduous nature of the task, which my duty calls upon me to perform: and above all when you reflect, that the statements of our resources, which are the result of the accounts, for which my right hon. friend has moved, and which are to be laid upon your table, cannot now be regarded, only, as the subject of idle boast and self-congratulation, but contain all the elementary principles, and compose the solid foundation of our greatness—that they afford the means to which we are to look, the instrument we are to employ, in maintaining and securing all that we possess of national independence and individual freedom. I confidently indulge the expectation that notwithstanding the dryness and prolixity of the various minute and complicated details into which I may be obliged to enter, the subject must ex

SUPPLIES.

NAVY (exclusive of the Ordnance Sea Service)

£16,977,837 9 3

ARMY

Great Britain

10,202,967 8 5

Ireland

3,445,130 17 3

13,648,098 5 0

BARRACKS

Great Britain

506,237 0 0

Ireland

469,450 12 6

975,687 12 6

Commissary General's Department

841,526 6 5

EXTRAORDINARIES, as in 1806,after deducting Vote of Commissary General's Department

Great Britain and Ireland

2,758,474 13 7

Total Army

18,223,786 18 2

ORDNANCE

Great Britain, including 422,500 l. Ordnance Sea Service

3,264,469 4 8

Ireland

479,246 19 7

3,743,716 4 3

MISCELLANEOUS

Great Britain

1,200,000 0 0

Ireland

666,000 0 0

1,866,000 0 0

VOTE OF Credit

Great Britain

2,400,000 0 0

Ireland

600,000 0 0

3,000,000 0 0

Total Joint Charge

43,811,340 11 8

SEPARATE CHARGES OF GREAT BRITAIN.

Deficiency of Malt, 1805

200,000 0 0

Services not voted paid in 1806

280,000 0 0

Interest on Exchequer bills, 1807

1,200,000 0 0

Five per Cents. 1797, to be paid off

350,000 0 0

2,030,000 0 0

Total Supplies

45,841,840 11 8

Deduct Irish proportion of Supply and Civil List, &c.

5,314,275, 0 0

Total to be defrayed by Great Britain

40,527,065 11 8

Deduct on account of Ireland 2-17ths of the above sum of 43,811,340 l. 11 s. 8d.

5,154,275

Deduct also 2-17ths for civil lists and other charges, the same as last year

160,000

5,314,275

cite such a degree of interest in your minds, as will procure me that of which I certainly shall stand in need, a patient and unwearied attention on the part of the committee.—Although not quite unprecedented, I am aware that it is an unusual course for the person filling the situation I have the honour to hold, to open to the house, a detailed statement of the supply and ways and means for the year before the loan has been contracted for; but I trust that from what I have to offer this night, I shall be able to satisfy the committee of the propriety, and indeed of the absolute necessity of adopting such a course upon the present occasion. Without therefore detaining the committee by any further preface, I shall proceed to state as the foundation of what I shall have afterwards to submit to you, the supplies and ways and means for the present year, as far as they can now be estimated. Nearly the whole of the former have already been voted by the house.—Here the noble lord made the following statement of the

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—It will be seen, said the noble lord, that a separate estimate is made out for the commissary-general's department upon the principle which I have on a former occasion explained to the house, of taking out of the account of the extraordinaries of the army, which are only voted after the services have been performed, all expenditure, the amount of which can be previously calculated and ascertained. Of the amount of the sum specified as a vote of credit, 1,000,000 l. may be considered as applicable to the discharge of an arrear of subsidies to foreign powers, due in consequence of existing treaties, and a further sum of 500,000 l. is left to be applied to further subsidies, should the state of Europe continue to require it. Whether this interposition upon our part, may be found necessary; whether the aspect of affairs upon the continent may, or may not become such as to require and to encourage more considerable advances, it is impossible for me now to state. What I have mentioned is all that his majesty's ministers deem it expedient to provide. It is thought that such a sum may be wanted, but there is no ground to form any certain conclusion upon that point.—With regard to the sum allotted to the interest of exchequer bills for the present year, those gentlemen who were in the last parliament will recollect that it was in the last sessions thought to be the more wise and manly course to state all the expenses of the year at once, and fairly to vote the interest that was to accrue upon the unfunded debt, in the year in which that debt was to be created, without leaving it to be provided for in a subsequent sessions; a course in which I am sure, the committee will think it proper to persevere.—And now, sir, having gone through the several articles of the supply, I shall find great satisfaction in stating the Ways and Means by which that supply is to be met. The produce of the duties on Malt Pensions, Tobacco, &c. 1 estimate at 2,750,000 l.; the Surplus of the Consolidated Fund I take at the same sum as the last year 3,502,000 l.; and I am happy to state to the committee, that notwithstanding the inauspicious changes and events which have occurred in Europe since the last sessions, I feel myself perfectly warranted in this calculation. The next article of the ways and means will be the War Taxes, which although their produce will, I trust, be greater, I shall at present, tor reasons I shall afterwards explain,
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take only at the sum of 19,800 l.; and here, sir, I am glad to take the opportunity of informing the committee, that the measures adopted last sessions with regard to the Property tax, have led to a result far exceeding the most sanguine expectation of the persons who were concerned in framing those measures, certainly far exceeding any expectation that I had formed. Indeed the result of the assessments of the present year has been such, that although I took the Property tax at but 10,500,000 l. in the last sessions, I now feel myself justified in taking it at 11,500,000 l.—The other war taxes upon customs and excise, I shall set down, including the increased produce of the additional duties imposed last year, at 9,500,000 l.; there is a further sum under this head to be added, of no very considerable magnitude—it is the result of an arrangement which has been some time in contemplation, but to the object of which it might be injurious at this moment to allude in explicit terms. I shall for the present observe only that it will be adopted more with a view to regulation than to revenue, and I have no doubt that when communicated to this house, it will meet with general approbation. Combining the produce of this arrangement with the duties I have stated, I conceive myself warranted in taking the war taxes prospectively at 21,000,000 l.; although it will be remembered that as a part of the ways and means for the year, they are taken at 19,800,000 l. The next article of the ways and means is the Lottery, which I estimate at 450,000 l. the same sum as last year.—In addition to these several sums there remains to be raised by Loan, 12,200,000 l. Gentlemen will recollect that the Loan of last year was 18,000,000 l. And it will readily be admitted that the consequences likely to result from such a reduction of its amount, will be most beneficial. Taking then the whole of the Ways and Means, viz.

Duty on Malt, Pensions, &c.

£2,750,000

Surplus of Consolidated Fund

3,500,000

War Taxes

19,800,000

Lottery

450,000

Exchequer Bills on Vote of Credit

2,400,000

Loan

2,1200,000

41,100,000

It will be observed, that the total of the

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Supplies being 40,527,065 l. 11 s. 8d. while that of the Ways and Means is 41,000,000 l. there will remain, an excess of 572,934 l. 8s. 4d. an excess which it may be thought desirable to provide, with a view to those circumstances in the state of the world, which may occasion an unavoidable fluctuation in that part of our revenue which arises from the trade and commerce of the country.—Having thus, sir, fully stated the supply and ways and means for the year, I should feel, were I now addressing you in any ordinary times, justified in confining my view to the exigencies of the moment.—I might here close my statement, dismissing the subject for the present year, and relieving myself from the necessity of intruding further upon your patience. But I think the committee will feel with me, that with the prospects that are before us in the present crisis of the history of the world, when the elements of discord are abroad, in the conspicuous station which we fill in Europe, with the eyes of all its nations fixed on us, that still preserve and value their independence, or that look to us as the means of regaining the independence they have lost, his majesty's ministers would not be justified were they to content themselves with presenting to parliament a limited and narrow statement of our circumstances and our views. I have no doubt that parliament and the country will agree with me in thinking that it is our duty and our interest to take an enlarged view of our situation and our prospects, and that from the emotions of gratitude we justly feel for our deliverance from the dangers that are past, we should direct our attention to those with which the future seems pregnant. Upon that future, there yet hangs a dark cloud, which we ought to contemplate, though not with alarm, yet with the awe and circumspection which our situation calls for. Much has passed over our heads, but there remains an impenetrable gloom, which although no human eye can search and scrutinize, it is yet our duty, if we can, to anticipate the dangers it contains, and to provide against the evils which it menaces, all those means of security which our national resources must happily afford, and which our reflection and experience may enable us to apply.—First of all then, as the greatest evil that can befall a civilized nation, it becomes our duty to make such arrangements as shall enable us to provide against the dan-
570
gers of protracted warfare, to. maintain the dreadful conflict, in which we are engaged, and the termination of. which no man can foresee, with the firmness we have hitherto shewn in its support, and if possible with increased energy and exertion.—With this impression upon my mind as to the situation in which the country is placed, I feel myself bound, not merely to consider the amount and nature of our resourses, but the adaptation of those resources to any contingency which may arise. In my view of this subject, I should not think myself justified in concealing my opinion, that there are unfavourable as well as favourable points belonging to our financial situation; and I feel, and the country must feel, that we labour under a considerable difficulty in discovering new sources of taxation; but yet so far from regarding this as a matter of surprise, I must confess the surprise I feel is, that the system of taxation should have so far supported us as it has done: such must be the feeling of any man who reflects upon the history of our revenue. It will be recollected that after the conclusion of the American war in the year 1784, our permanent revenue amounted to but 10 millions, and yet that great financial statesman (Mr. Pitt), who then presided over the affairs of the country, found it difficult to deyise additional taxes. Indeed, some which he had imposed, he felt himself obliged to withdraw in the following year, and the difficulties under which. he laboured were readily acknowledged. Yet such has been the augmentation of our resources, that the permanent revenue reached the sum of 28 millions at the conclusion of the last war, and at present it amounts to no less a sum than 32 millions.—It must indeed be matter of heartfelt satisfaction to any man interested in our fate, to reflect upon such evidence of the growing prosperity of the country, to find that our means have kept pace with our expenditure, and enabled us to bear for so many years a constant and progressive addition to our burthens.—At the same time that I state the difficulty of finding out new objects of taxation, I beg not to be understood as considering the means or disposition of the country exhausted in this respect; for, relying on the spirit and alacrity of the people to submit to further sacrifices from a just conception of the important ends for which those sacrifices would be made, I am prepared to

571
state that ample means would be forthcoming it required to pay not only the interest of the loan of this year, but of the next, and perhaps several years to come. But looking, as I think it is our duty to look, to a long period of protracted war, we could hardly expect to continue from year to year, in addition to our actual burthens, augmenting our permanent taxes to a considerable extent without imposing restraints which might prove extremely vexatious and distressing in some instances, and in others incurring the risk of injuring the produce of old duties, and impeding national improvement, by taxing staple commodities, or such articles as would impede the growth of our trade and manufactures, by enhancing the price of the instruments with which they are conducted. In this view then it becomes of great importance to consider of what application our resources in future will admit, and, if possible, to combine with a provision for the vigorous support of the contest in which we are engaged, some relief from the prospect of increasing burthens. To relieve the public from any pressure is at all times desirable, but with the prospect before us, it is an object of the last importance. But the policy which prompted such a resolution, would indeed be most short-sighted and unjust, and defeat the very objects it purposes to attain, were it to lead to any anticipation of the resources of the future, much less did it involve the violation of any of those principles which have been recognized by public opinion, or sanctioned by public faith, and which it will, I trust, remain the invariable policy of this country to uphold. Much and ardently as I desire the relief of the people, I should never be reconciled to any proposition, however calculated to gratify this desire, if that relief were to be accomplished by the sacrifice of any of those major considerations; or any of those fundamental obligations, into which parliament has deliberately entered, and which the voice of the country has confirmed. I should be amongst the first to resist any measure calculated to injure, much less to destroy that great system which has so essentially contributed to maintain our national credit and to promote our national glory. But happily, there exists no necessity for any breach of faith, far any deviation from that course of rectitude which has ever constituted the pride and honour of Great Britain. (Hear! Hear!)—I
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now come to the more satisfactory part of my duty, to touch upon the state of our great national resources, and in adverting to those topics it must be a peculiarly gratifying circumstance to reflect that the prosperity which they indicate, does not depend upon mere fortune; that it has not arisen from any of those casualties or chances which alternately raise or depress states; but that on the contrary it is the gradual result of the resolution, foresight, and energy of parliament, supported on the part of the people by a spirit, industry, and perseverance, alternately the cause and the effect of national improvement and prosperity. (A loud cry of hear! hear!)—In considering our resources, the Sinking Fund, and the system of raising a large portion of the supplies within the year, which has given rise to the present amount of War taxes, are the two great subjects to which I shall have occasion to direct your attention. I hope for the indulgence of the committee while I take the liberty of dwelling upon their origin and progress, more especially as they form the ground-work of the system I shall have to propose for its consideration. They are, perhaps, the most remarkable features in the political and financial history not only of this, but of any country in the world.—First then as to the Sinking Fund, or the system of applying annually certain portions of the revenue to redeem, and after redeeming, to accumulate for the further redemption of debt. The first establishment of this fund took place, it will be recollected, in l786, and it was introduced by Mr. Pitt, to the credit and honour of whose name it will long remain a monument. Wherever I contemplate this system, it is impossible that I should not feel a satisfaction in adverting to the author to whose measures I can never allude with greater satisfaction, than when I am enabled to bestow upon them that tribute of admiration which in the present instance I most, warmly, and I may say, enthusiastically feel.—It will be matter of pleasing reflection to the house to recollect at the moment when we have felt within the space of the same year the loss of two illustrious characters; as distinguished competitors for fame and power as any country ever saw, and whom all men, whether friends or enemies, I mean of course political enemies, for none other could such men have had, will admit to have been the greatest and brightest ornaments of the

573
time in which they lived; to recollect, I say, that both these distinguished persons concurred in the approbation and sanction they gave to this measure; that after some slight differences of opinion it was finally marked by a coincidence of sentiment on the part of both; that, amidst the dissention which prevailed on other topics, amidst the conflicts which so often and so long agitated this house, that upon the subject of the sinking fund, all those feelings and animosities disappeared; and the measure has uniformly continued to derive from that combination of opinion all the just weight and authority that belonged to it.—When the sinking fund was first established, as I have already observed, in 1786, one million was appropriated to the purposes of that fund. At that time, the public funded debt amounted to 238,231,248 l.; and therefore the sinking fund was equal to the 238th part of the whole debt. The accumulation of the latter however raised its proportion to the former by the close of 1792, to the 160th part. A further addition to this fund was proposed by Mr. Pitt, and readily adopted in 1792, consisting of a grant of 400,000 l. arising from the surplus of the revenue, and a further annual grant of 200,000 l. So thenceforth 1,200,000 l. were applied to the increased fund, and at the commencement of the war with the French republic, in 1793, looking to what had been held out and declared in the previous arrangements, a sinking fund of a different character was constituted. This consisted in setting apart one per cent. on the nominal capital created by each loan in order to form a fund for the liquidation of that loan. With respect to the first sinking fund, the sum voted in 1786, and that superadded to it, in 1792, were to be allowed to accumulate at compound interest until they reached the maximum, of 4,000,000 l.; and it was provided that any surplus which might afterwards arise should become applicable to the public service and be at the disposal of parliament. But the fund arising out of the principal established in 1793, was to be subject to no such limitation; for the sum of one per cent. appropriated upon each loan, was to go on accumulating, until it accomplished the redemption of that loan, which it was calculated would probably be effected. in 45 years from the period at which the loan might have been contracted.—No alteration was made in the relative state of those funds until the year 1802. When
574
lord Sidmouth, looking at the amount of the debt, but at the same time, impressed with the necessity of keeping open and unincumbered the system of raising a large portion of the supplies within the year, found it expedient from the amount of taxes he was compelled to raise to defray the interest of stock, for which the income tax had been pledged, to avoid loading the public with the additional of a sinking fund for that stock. To reconcile the stockholder to this arrangement, he consolidated the old and the new sinking funds. By the act which parliament then passed, the provision limiting the progress of the fund of 1786, when it should reach the amount of 4 millions, which it was calculated it would reach in 1808, was done away; and it was provided that the fund of 1786, should be consolidated with the fund arising from the appropriation of one per cent. on the nominal amount of each loan, and that both funds, thus combined, should be applied to the redemption of the whole debt.—This debt amounted in February 1803, to 480,572,470 l. and the produce of the joint sinking funds to 6,311,626 l.; so that although this fund was originally but in the proportion of the 266th part, it became in 1803 equal to a 77th part of the whole unredeemed debt.—It now remains for me to state the present portion of the sinking fund to the debt; and, the committee will hear with satisfaction that this proportion opens a still more pleasing prospect; for since the consolidation proposed by. lord Sidmouth, the sinkfund has materially. advanced. The amount of the unredeemed debt at present is, on rather, will be on; the 5th of February next, within a few days from the time at which I am speaking, 530,351,89 l., while that of the sinking fund is 8,331,709 l. So that the sinking fund is now equal to the 63d part of the whole debt, or, if the committee are desirous of taking another, and. Perhaps a clearer, view of the subject, calculating the debt not at its. nominal but at its real money value, (that is, taking the three per cents. at sixty) the proportion which the sinking fund bears to the unredeemed debt, is that of, 1 to 42; a result at once satisfactory and striking, when it is considered that it arises out of a period of 20 years only, of which it will be recollected that 14 have been years of war.—I hope the committee will pardon me for having o long detained their attention

575
upon this part of the subject—as it forms a material branch of the system which I shall have the honour of submitting to their consideration, the natural tendency and great recommendation of which will be that it will give an increasing power to the operation of the Sinking Fund.—The second branch of the proposed system refers to the War Taxes, to the origin, progress, character, and probable improvement of which I beg leave shortly to call the attention of the committee. In the year 1797, recourse was had to the principle of raising a considerable portion of the supplies within the year: but much as I admire that principle, and however beneficial the effects that have arisen from its operation, I must yet say that from the manner of its application, it was particularly in detail extremely unfair and unjust in its pressure. I do not make this observation with a view to censure any persons whatever, nor should I feel justified in pronouncing censure upon the original authors of such a plan from my own knowledge of the extreme difficulties that arise in the endeavour to carry into complete execution the principle of raising a large portion of the supplies within the year. But I have always been of opinion that the application of that principle to the assessed taxes in the case of the treble assessment was extremely unjust, as proceeding upon the very erroneous ground of taking expenditure as the criterion of income. The produce of the treble assessment for the year 1798 amounted only to 3,794,552 l. In the following year, from the experience .of its imperfections, the treble assessment was laid aside, but the principle of raising a large portion of the supplies within the year, was retained, and the income tax substituted in its room. At the first imposition of the treble assessment, it had been subjected to a charge of 16 millions, the interest of which was to be defrayed out of its produce during the war, and on the return of peace the residue was also to be applied to the extinction of that debt. This charge therefore was transferred to the income tax, which thus became burthened with a double mortgage, to. discharge which its continuance would have been necessary after the war had ceased, to defray the expenditure of which it was imposed. In consequence of this arrangement the principle of raising the supplies within the year was sacrificed, or at least partially suspended, by the appli-
576
cation of that which was professedly a war tax, to provide for the interest of debt during the war, and for its redemption after a peace. This inconvenience did not escape Mr. Pitt's observation, and he found himself in consequence so far obliged to abandon this system, that in the year 1801, he returned to his former mode of raising loans, and no part of the loan for that year was charged upon the income tax. In 1802, alter the peace of Amiens, when lord Sidmouth took the state of our finances into consideration, with a view to a peace establishment, the first circumstance of embarrassment that naturally occurred was the state in which the income tax was pledged. He found it mortgaged for a debt of no less than 56 millions of capital, to discharge which it would of course be necessary to continue it nine years after the war, in order to pay not only the capital debt, but the sum of 1,700,000 l. annual charge for interest. With a view therefore not only to the relief of the country from the burthen of this tax, but also to leave this great resource open to be applied to the public exigencies in the event of renewed hostility, with all the additional effect and improved direction that could then be given to it, the noble lord who then filled the situation which I have now the honour to occupy, had recourse to the bold measure of repealing the tax and funding 56 millions of stock chargeable upon it, in addition to the sum of 40 millions required on account of the unfunded debt at the conclusion of the. war; and for payment of the interest on this sum of 96 millions he contrived to find sufficient taxes. Thus was the country set free from this extraordinary burthen, and afforded the opportunity of saving its means for those future exertions which unhappily it was but too soon afterwards called upon to make, and the subsequent necessity of which form the best comment on the judicious policy which dictated, and the energy which effected a measure, without which, at the commencement of the present contest, our means would have been crippled, and our principal system weakened in the very point in which its strength could be most usefully displayed.—At the commencement of the present war, the tax upon property was substituted for that upon income. As this subject has already been amply discussed, I do not mean to observe further upon the property tax at present than to say, that it contained

577
all the improvements which might have been expected from the experience of antecedent measures, for raising a large portion of the supplies within the year, and that even in the first instance of its application, it exceeded in produce the hopes of those by whom it was framed. The largest amount of the income tax at 10 per cent. in the last war was 5,651,642 l. the first year's produce of the property tax, in which its operation could be said fairly to have commenced was 3,919,108 l. Still I do not mean to assert that this was at its outset or is even now, strictly speaking, an equal tax, or that it operates with perfect equality upon all classes of the community, much less upon all the individuals who compose those classes. That partial imperfection which is inseparable from all widely extended institutions must peculiarly attach to the provisions of a tax, calculated to include an immense mass of property, and persons placed in circumstances so infinitely diversified. It is indeed morally impossible to apply equally any large and general financial measure, without enfeebling its productive powers. As in the administration of criminal justice, which alike assumes equality in its operation, the same punishment affects men differently according to the health, temperament, strength of body or of mind, or the particular state and condition of the individual who suffers. So in taxation it ever has been, and ever will be unequally felt in its pressure, according to the peculiar situation and local circumstances of the persons to whom it attaches. This inequality is most sincerely to be regretted, and no man feels more strongly than I do how desirable it would be to provide for the most equitable distribution of the public burthens. But I apprehend that no ingenuity that can be exercised by any legislature will ever be sufficient completely to guard against the effect of that diversity of circumstances, which it would be difficult to ascertain and estimate, and much more difficult to counteract. The great practical object in the arrangement of this tax was to adopt some general principle, which should leave as little room as possible for evasion, because such evasion must, not only with regard to this but to all other taxes, be productive of injustice to those who do not evade while it serves to injure the state: and I have the satisfaction to inform the committee that this
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object has been in a great measure accomplished. Such means have been devised and put in force, to secure an accurate return of income, and such regulations adopted to ensure a strict collection in the customs and excise, that without resorting to any of the inquisitorial proceedings to produce a disclosure of property, which were formerly complained of, a very large proportion indeed of the expences of the war have been raised within the year.—To these objects the attention of ministers was called immediately after they entered into office last year, in consequence of the situation in which they found the finances of the country. Finding the annual expences of the country had increased no less than 7 millions, while the increase of the annual revenue did not exceed one million; in this state of things, with a growing expence and inadequate supply, it was determined to put the circumstances of the country upon a better footing. It was therefore resolved by government to propose an addition to the property tax, and also such further increase of the customs and excise as should raise the produce of the war taxes to 18 millions. As the humble organ of government, it became my duty to submit these propositions to parliament. The duty was painful, and I felt it most sensibly. I was fully aware, that the imposition of taxes is at all times an ungracious task, and that from the nature and amount of the taxes, the increase of which I was then called upon to propose, it was likely to be so in a peculiar degree. But with all these considerations on my mind, combined with the reluctance which I must naturally feel to impose any additional burthens upon my country, the exigency of the public service and the magnitude of the objects in view would not allow me to shrink from my duty even so far as to yield to some of the exemptions proposed.—I have now the satisfaction of thinking that the pain occasioned by the original proposition is in a great measure compensated by the efficiency of its produce. Such indeed has been the increase of the property tax, not so much in the character of burthen, as in the removal of that part of the system which admitted of evasion, that I feel myself justified in taking its produce for the present year at one million beyond what it yielded in the last, which, combined with the other war taxes, and the improved application of the sinking fund, will be amply adequate

579
to defray our future expences to whatever height they can be fairly calculated to arise.—I trust that I have not deceived the committee in the picture I have drawn of the unfavourable points in our financial situation, and that I am justified in availing myself to the extent to which I have gone, of those points that are favourable, I think it will be found that I have neither concealed any part of the one nor exaggerated any circumstance of the other. In estimating the favourable points in our situation, I feel myself justified in taking the improved amount of the war taxes at 21,000,000 l. which with the produce of the sinking fund of 8,300,000 l., I set down as forming a clear annual revenue of about 30,000,000 l. Of this sum then the country is in possession, and at liberty to apply it to her use independently of the aids derived from her ordinary permanent revenues. (Hear! hear!) This is a fact upon which the committee and the country must reflect with pleasure, and from which gentlemen will proceed with greater satisfaction to consider how such a sum ought to be applied to meet the calls of a war, which from its nature demands our utmost exertion.—I now come to the consideration of the Expenditure which may be incurred for the present year, and which will form the criterion upon which I mean to found my calculations as to the expence upon the future years of war. In taking this criterion, I judge of course by the present state of expence independently both of subsidies to foreign powers and of such additional charges as may be occasioned by unforeseen emergencies, or by any increase in our establishments, or in the price of naval and military stores. Should such emergencies arise, as most probably they will, or should the operation of any of the causes I have just stated produce an addition to our expenditure, that addition must under the system I shall have the honour to propose, as it must under any other system of finance, be attended with an increase of burthen upon the public —It may however be proper to observe, that should such further demands arise, they will occasion no departure from the principle of the arrangement which I have to propose to you, as they will serve only to cause a proportional addition to the amount of new taxes which under this plan would otherwise be required in that year. But to return to the question of war expenditure: the amount of the sup-
580
plies I have already stated at 40,527,065 l, and that of the ways and means at 41,100,000 l.; which leaves a surplus of more than 500,000 l. But to this point I have already alluded. Excluding from this statement all demands which do not come into the regular account of our annual expenditure, or which may not recur, and deducting also the amount of the surplus of the consolidated fund and the annual taxes, upon the produce of which we may safely rely, we then come to ascertain the sum wanted to supply the exigencies of the war. In the first place, deducting the subsidies 1,5000,000 l. and the sum required for the repayment of 5 per cents. 1797, 350,000 l. the supply will be reduced to 38,677,000 l. But the farther deductions of 2,750,000 l. for the malt duty, of 3,500,000 l. for the surplus of the consolidated fund, and of 450,000 l. for the lottery, will reduce the provision to be made for the service of the war to 31,977,000 l. or, taking it in round numbers, to 32,000,000 l.—Now, sir, this is the point from which we are to depart in the arrangement, which I shall have the honour of submitting to you. I have shewn that the sum required to defray the extra expence of the war, amounts to 32,000,000 l. To provide for this independently of the produce of the war taxes, I propose to borrow the sum of 12,000,000 l. by way of loan.—These 12 millions it is proposed to raise as a war loan to be charged upon the war taxes, a certain portion of which is immediately to be set apart for its liquidation. But here two difficulties present themselves, which must have already occurred to the minds of the committee; the first is, that the tendency of such an operation must be gradually to exhaust the war taxes, so that at the end of a certain, although a remote period, this source of our supplies will be dried up.—The other objection is, that on the supposition of a prolongation of the war beyond the period, in which the war duties of excise and customs will be exhausted, a part, or, if the war should still continue, the whole of the property tax will be pledged for several years after the conclusion of peace. The means, however, by which I propose to obviate both these difficulties, will, I trust, when explained, receive the entire approbation of the committee.—It is proposed, sir, to borrow 12,000,000 l. annually for the first 3 years, from the present time; for the fourth year (or 1810)

581
14,000,000 l.; and for the ten succeeding years, if war shall so long continue, 16,000,000 l. in each year.—In the first and each successive year for which these loans shall be raised, so much of the war taxes is to be appropriated, as will amount to 10 per cent. on the loan so raised. Out of this 10 per cent. the interest and charges of management are first to be defrayed, and the remainder is to constitute a sinking fund for the redemption of that loan.—When the interest of money is at 5 per cent. such a sinking fund would redeem each loan in 14 years from its creation; and in case of a rise in the funds, this redemption would be accelerated; because the loans would be borrowed at a lower rate of interest, and that proportion of the ten per cent. which would be applicable to the sinking fund, would consequently be greater.—But, without distracting the attention of the committee with the different results deducible on the supposition of variations of the funds, which, if they should arise in any material degree, are likely to favour the operation of this plan, I will proceed on the supposition that the funds remain at 60.—Thus, if 12,000,000 l. be borrowed at 60, in 1807, the portion of war taxes appropriated to the interest and sinking fund on that loan will be 1,200,000 l.; and that portion will continue payable for 14 years, (that is, till the end of the year 1820,) and at the expiration of those 14 years the loan of 1807 will have been wholly redeemed by the operation of its own sinking fund, and consequently the 1,200,000 l. war taxes so pledged will then be liberated, and so in succession with respect to the loans of the following years, each of which will mortgage for 14 years its corresponding portion of the war taxes. It will be seen that this system may be carried on for 7 years from 1807, without pledging any part of the property tax; as the whole charge on the war taxes in those seven years, will amount to no more than 9,800,000 l. The war duties of customs and excise, exclusive of the property tax, are estimated at 9,500,000 l., and it may be reasonably expected that the produce in the course of the next 7 years will be raised to 9,800,000 l. I shall take an opportunity hereafter of stating the other measures to which it is proposed to have recourse, in order to prevent the necessity of pledging the property tax beyond the period for which it is now imposed, viz. the continuance of the present war.—This part of my calculation is framed on the suppo-
582
sition of the continuance of the war for the whole 14 years. If peace should be sooner re-established, other arrangements may easily be made, by which the portions of war taxes so pledged may be released at earlier periods; and the part not pledged will of course immediately be liberated on the return of peace. If on the contrary the war should be prolonged beyond these 14 years, war loans to the amounts above stated may be continued indefinitely, and the fresh charge so created in each year may be defrayed by the portions of war taxes thus successively falling in, without the necessity of laying on for that purpose any further taxes beyond those now in existence.—But as the interest and sinking fund to be thus provided in each successive year for the charge of these war loans are taken from the produce of the war taxes, which now constitute a part of the means by which the annual expenditure is defrayed, the deficiencies so created must be supplied as they may respectively arise by supplementary loans.—The loan so required this year will be only 200,000 l. But it is obvious that the amount of the supplementary loans required for this purpose will, in each succeeding year, progressively increase by so much as the interest and sinking fund of the fresh war loans, annually charged upon the war taxes, shall lessen the unappropriated residue of those taxes.—But, although the supplementary loans will progressively increase, yet it will appear that the whole amount to be raised by loan in any one year for the period of 20 years, (supposing the war so long to continue) or, in other words, that the combined amount of the war and supplementary loans, will only in one year exceed by more than 5,000,000 l. the sum which will, on the principles assumed in this plan, be applicable in the same year to the reduction of the national debt. Calculations of this nature are indeed liable to be varied by fluctuations in the price of the stocks. But on the whole, there seems no reason to doubt, that although the sums to be borrowed in the latter part of the abovementioned period of 20 years, should the present war so long continue, might unquestionably appear large; yet their effect upon the money market will always be sufficiently counteracted by the large amount to be paid off within the same year, by the operation of the sinking fund, in the manner, and with the limitations

583
which I shall presently explain.—And this, I trust, will prove a most satisfactory article of information to the committee. For, if we look back to the loans of last war, we shall find that in one year (1797) the addition made to the public debt, that is to say, the excess of the sum borrowed above the sum redeemed by the sinking fund in that year, amounted to the enormous sum of 40,000,000 l. money capital; and that on an average of the last 14 years the addition to the public debt amounted to 15,000,000 l. annually; whereas under the system which I shall this night have the honour of proposing to the committee, should the war be protracted till the close of the year 1826, the addition to the public debt will in no one year, except the last (1823), exceed the sum of 5,000,000 l., and on an average of the 20 years from 1807 to 1826 inclusive, will fall below the sum of 4,000,000 l. annually.—It is proposed to raise these supplementary loans according to the system pursued since the year 1792. A sinking fund of one per cent. upon the nominal capital will be added to the interest on these loans, and the charge so created will be provided for by imposing new taxes, or by the falling in of annuities.—The sum requisite to defray the interest and sinking fund of those supplementary loans will in the present year (1807) be 13,333 l.; in 1808, 93,333 l.; and so on progressively increasing in each year. But in considering the mode in which provision is to be made for those charges, it will be convenient, for reasons that will hereafter present themselves to the committee, to divide the whole period of 20 years into three successive period of three, seven, and ten years.—With respect to the first period of three years from the present time, the amount of taxes required in 1807 will be 13,333 l.; in 1808, 93,333 l.; and in 1809, 173,333 l.; or the amount required in the whole three years will be 279,999 l.; but in the present year annuities will fall in to the amount of 15,515 l.; and in 1808 to the amount of 370,000 l., making together the sum of 385,515 l.—The amount of these annuities being therefore more than sufficient to discharge the interest, &c. upon the supplementary loans to be contracted for within the period of three years, the committee will hear with satisfaction, that for those three years not a shilling of new taxes whatever will be imposed upon the country. [A loud cry of hear! hear!] This will
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be the first effect of the system I have the honour to propose; in the course of the next three years no new taxes will be imposed, but on the contrary, a surplus of the annuities already mentioned will remain applicable to the service of subsequent years. With respect to the second period of seven years commencing with 1810 and ending with 1816, the charge occasioned by the supplementary loan in 1810, will be 133,333 l.; in 1811, 106,666 l.; and will then increase progressively in each year, till in 1816, 640,000 l. will be wanted. For these charges provision might be made by raising taxes to the amount required in each year; but as this mode might have the appearance of a desire to shift the burthen from the earlier so as to make it fall with disproportioned pressure on the latter years of the period, it has been thought more advisable to take an average in order that the pressure may be evenly diffused over the surface of the seven years. The result of this average is, that it will be necessary to raise the sum of 293,000 l. annually by new taxes, for the period of seven years, from 1810 to 1817.—I am confident, sir, that the committee participates with me the satisfaction I feel at being enabled to make so satisfactory a statement. That at this time, sir, at the commencement of the fifth year of a war, the most expensive in its progress and the most important in its consequences that this country has ever carried on, we have in our hands the means of providing for an annual extraordinary expenditure of 32,000,000 l. without imposing any additional burthen for the next three years, and with only the comparatively trifling addition of 293,000 l.; annually for the seven subsequent years, is surely a statement of which the house and the country may be justly proud. And I trust, sir, that I shall not incur the charge of being too sanguine in my expectations, when I state my belief that this annual addition of 293,000 l. will in all probability be considerably diminished by the spring, which will be given to consumption by the relief afforded to the public from additional taxation, and which will operate to the increase of the existing revenue, and by the further increase in the produce of the existing revenue arising from improvements in the mode of collection, which the relief from additional taxation will tend greatly to facilitate.—It is, however, sufficient to have shewn, that provision

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may be made for ten years continuance of war, without imposing taxes in any one year to a greater amount than I have already stated. And it must again be remarked, that if peace should occur at an earlier period than the ten years here supposed, the burthens would of course be proportionally diminished; no further supplementary loans would then be required; the portions of war taxes then pledged would gradually fall in; those not pledged might at once be repealed, and other resources would present themselves for affording ease to all our financial operations. Having gone through the two first periods, I shall now proceed to the third. But before I enter upon it, I must beg leave again to call the attention of the committee, to the subject of the sinking fund, which during this period will become more immediately applicable to the public service. At the first establishment of the sinking fund, the amount appropriated to the reduction of the debt bore so small a proportion to the total capital of the debt, and to the general extent of our money transactions, that it might hardly have appeared necessary to take any precautions for preventing the inconveniences which might at a future period arise from the too rapid reduction of the debt, and too great accumulation of floating capital in the money market. Yet, with a view both to these inconveniences, and to the holding out a prospect of some relief to the public from taxes within a moderate distance of time, the accumulation of the sinking fund at compound interest was limited to the extent of 4,000,000 l., and after it should have reached that sum (which it was then computed would take place about 1808) it was thenceforward to be applied to that extent only, leaving the accruing surplus at the disposal of parliament.—The reasons which induced Mr. Pitt to fix this limitation are obvious. I need hardly press upon the consideration of the committee all the evils likely to result from allowing the sinking fund to accumulate without any limit; for the nation would be exposed by that accumulation to the mischief of having a large portion of capital taken at once out of the market without any adequate means of applying it, which would of course be deprived of its value. This evil must appear so serious to any man who contemplates its character, that I have no doubt it will be felt, however paradoxical it may seem, that the redemption of
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the whole national debt at once would be productive of something like national bankruptcy, for the capital being returned suddenly into the hands of the holder, without any means of disposing of it, that capital would be equivalent almost to nothing, while the interest he had before derived from it would be altogether extinguished. The other evils which would arise from, and which must serve to demonstrate the mischievous consequence of, a prompt discharge of the national debt, I shall shew presently.—Different arrangements were adopted in the further provisions made on the subject of the sinking fund in 1792 and in 1802. By the first the sinking fund of one per cent. which was thenceforward to be provided for every new loan, was made to accumulate at compound interest until the whole of the debt created by such new loan should be extinguished. And by the second arrangement all the various sinking funds existing in 1802 were consolidated, and the whole were appropriated to accumulate at compound interest, until the discharge of the whole of the debt, also existing in 1802. But the debt created since 1802, amounting to about 100,000,000 l. of nominal capital, is still left subject to the conditions of the act of 1792, which provides for each separate loan a sinking fund of only one per cent. on the nominal capital.—The plan of 1802, engrafted on the former acts of 1786 and 1792, provided for the still more speedy extinction of the debt to which it applied. But it would postpone all relief from the public burthens to a very distant period (computed in 1802 to be from 1834 to 1844); and it would throw such large and disproportioned sums into the money market in the latter years of its operation, as might produce a very dangerous depreciation of the value of money. Many inconveniences might also arise from the sudden stop which would be put to the application of those sums when the whole debt should have been redeemed, and from the no less sudden change in the price of all commodities which must follow from taking off at one and the same moment, taxes to an extent probably then much exceeding 30,000.000 l. The fate of merchants, manufacturers, mechanics, and every description of dealers, in such an event, must be contemplated by every thinking man with alarm; and this applies to my observation respecting a national

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bankruptcy, for should the national debt be discharged, and such a weight of taxation taken off at once, all the goods remaining on hand would be, comparatively speaking, of no value to the holders, because having been purchased or manufactured while such taxation prevailed, they must be undersold by all those who might manufacture the same kind of goods after such taxation had ceased. These objections were foreseen, and to a certain degree acknowledged, at the time when the act of 1802 was passed: and it was then answered, that whenever the danger approached, it might be obviated by subsequent arrangements.—It appears, therefore, highly desirable that a plan should be adopted which may remedy these inconveniences, if it can be done without injury either to the present or future interests of the stock-holders, and without retarding the discharge of the existing public debt beyond the period already prescribed by parliament. This it is conceived may be effected by rendering the operation of the sinking fund more equal in its progress, by increasing its present powers, and by diffusing over a greater number of years these extensive effects which would, according to the present system, be confined to the very last period of its operation.—The arrangements proposed for this purpose are founded in part on calculations drawn from the increased benefit which will have been given to the stockholder, by applying a sinking fund of five per cent. on the money capital, instead of one per cent. on the nominal capital, to so large a proportion of the loans of the first ten years. It is proposed in return for this advantage, that when the present sinking fund shall have so accumulated as to exceed in its amount the interest of such part of the present debt as shall then remain unredeemed, the excesses of the sinking fund above the interest shall be at the disposal of parliament: but that these excesses shall never be made available to such an extent as would either prevent the redemption of a sum equal to the now existing debt, in as short a period as the same would be paid off by the operation of the present system, or postpone the final redemption of any future loan beyond the 45 years limited for that purpose by the act of 1792. And in this way a considerable increased advantage is given to the stockholder. By the operation of the proposed plan a lar-
588
ger sinking fund will be applied to the redemption of the present debt, until the period of its final extinction, than would have been applied during the same period by the effect of the present system. An amount also equal to the present debt will be redeemed at a much earlier period by the proposed plan, than by the existing system; and an amount equal to all future loans to be raised according to this plan during the continuance of the war, will, in any supposition of a rise in the funds, always be redeemed very considerably within 45 years from the date of the creation of every such loan. It will easily be seen that the result will in any case be that of a full compliance with the provisions of the act of 1792. Thus will parliament be enabled to afford ease to the public, and relief from taxation, in conformity to the principle of the act of 1786, without violating in the smallest degree, the principles of the subsequent acts of 1792 and 1802, or trenching upon any right or interest enjoyed by the public creditor.—It remains now to shew what will be the periods at which these arrangements will come in aid of the means of defraying the public expenditure during the third period of 10 years, supposing the war so long to continue. The provision made for the first and second periods, is independent of any measure respecting the excesses of the present sinking fnnd. Those excesses will not, according to this plan, become available in respect of the present debt till the beginning of 1817. In respect of the debt created by the new supplementary loans, the excesses will not be available until their sinking fund of one per cent. on the nominal capital, shall have accumulated to an amount equal to the interest of such part of those loans as shall then be unredeemed. The whole sinking fund created in respect of the debt charged upon the war taxes, must of course during the war be applied invariably to the redemption of that debt, in order to effect its extinction within the period of 14 years, as above explained, and to set free such portions of those taxes as must be applied to the charge of fresh loans to be raised in the same manner so long as the war shall continue. No excesses of the war sinking fund could therefore be available during the war, but on the return of peace there could be no objection to the consolidation of the war sinking fund with the sinking fund of the present

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debt, and to the leaving at the disposal of parliament the excesses of such sinking fund, so consolidated, above the interest of the war debt, and of the present debt, which would in like manner, be consolidated for this purpose.—These distinctions between present debt, war debt, and supplementary debt, are however, meant to be preserved, only, by keeping separate accounts of the payments made from each of the sinking funds; in order that the operation of the plan may distinctly appear. But it is intended that in practice the whole of the present debt shall be considered as forming one general mass of debt, with the future war debts and supplementary debts, as they are successively incurred and that the different sinking funds shall be applied by the commissioners for the reduction of the national debt indiscriminately to the purchase of any part of these debts. From what has been said, it will easily be seen that this plan will effectually provide for the present expenditure, during the whole of the second series of ten years. I have already mentioned, that with respect to the present debt the excess of sinking fund above interest, calculated on the present price of stocks, will become available in the year 1817: But the whole of these excesses will not on that calculation be wanted for the purpose of carrying on this plan, even supposing the continuance of the war for the whole of the second series. A part only need on that supposition be taken in each year, and the remainder will be carried as at present in aid of the accumulation of the sinking fund. The result of this operation, with respect to these ten years will then be, (supposing the war to continue so long) that no new taxes whatever will be required in the whole of this period. It appears hardly necessary to carry these calculations beyond the supposition of 20 years continuance of the present war. But to any one who considers the effect which must be produced on our finances by the intermediate operations here described, and by the proportion which the sinking fund will then bear to the unredeemed debt, it must be obvious that after that period no considerable financial difficulty is likely to arise.—I shall now, sir, proceed to that point, which, if I may be allowed to judge from the feeling expressed when I before stated the circumstance, will prove an article of most satisfactory information to the committee, viz. to explain the mode by
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which we shall be enabled to release the Property tax, at the expiration of the term for which it is already pledged, that is, at the end of six months from the ratification of a definitive treaty of peace. I have already shewn that the amount of war taxes pledged in the next seven years will be 9,800,000 l. a sum which it may be reasonably expected the war duties of excise and customs will be sufficient to supply. Should peace therefore take place in the course of seven years from the present time, no part of the property tax will have been pledged. Should peace take place between the end of the seventh and of the tenth year from the present time, that is, between January 1814, and January 1817, part of the property tax will have been applied to the purposes of this plan, but it may be released immediately on the conclusion of peace, by extending that principle to the excesses of the sinking fund of the war debt which I have already stated it is intended to apply to the excesses of the present sinking fund. In 1817, the excesses of the present sinking fund begin to arise, and when combined with the excesses of the sinking fund of the war debt will be amply sufficient to redeem, on the return of peace, any part of the property tax that may have been pledged.—From the length to which my observations have already extended, I feel very reluctant farther to take up the time of the committee; but I must beg leave to trespass upon their attention, while I briefly recapitulate the heads of the system, which I have had the honour of detailing to them.—We shall, in the first place, by this plan be enabled to provide for an extraordinary expenditure of 32,000,000 l.; (and here I wish most particularly to impress upon the minds of the committee, that the plan I have submitted undertakes to provide only for an expenditure of 32,000,000 l.: should any further charge arise, that charge must under this, as under any other system of finance, be productive of additional burthens;) but, sir, we shall by this plan be enabled to provide for an annual extraordinary expenditure of 32,900,000 l. without imposing any additional burthen on the public for the next three years, and should the war so long continue, for the seven subsequent years to that period, with the compartively trifling addition to the taxes, of 293,000 l. annually; but should the war be still further protracted, should it even continue for ten years beyond the two periods I have already men-

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tioned, we shall have the means of providing for an expenditure of 32,000,000 l. without imposing on the public any additional burthen at all. And this relief, sir, will be obtained without the least injury to the interest of the stock-holder; on the contrary, an addition will be made to the sinking fund even in the present year; an amount equal to the present unredeemed debt will be more speedily redeemed; the proportion which the sinking fund bears to the unredeemed debt, and on which the period of the redemption of that debt depends will be increased; and by a more equal distribution of the powers of the sinking fund, those inconveniencies will be avoided which would necessarily arise from the too great influx of money into the market in the latter years of its operation. It is true indeed, sir, that a part of the war taxes will be pledged beyond the war, but I have already shewn that the property tax may under any circumstances be released at the end of six months from the ratification of the definitive treaty of peace, and by the application of the excesses of the sinking funds of the present and war debts as they arise, the release of the other war taxes will be considerably accelerated.—Such, sir, is the proposed plan of Finance which his majesty's ministers have thought deserving of the serious attention of the house; a plan resting on a foundation, the solidity and strength of which has been proved by experience on the great resources of the country; on the increased and increasing operation of the fund for the redemption of the national debt; on the approved principle of raising the greater part of the supplies within the year, carried to the extent to which it was last year, and above all, on the constancy of a people resolved to omit no exertion; to be dismayed by no difficulty, and to shrink from no privation, which can be called for by the honour and interests of their country.—The propositions which I have had the honour of submitting to the house, however impossible it may be to guard against the effects of chance, and the mutability of events, are recommended by the most positive experience, and depend upon causes which have been already ascertained to be constant and steady in their operation. If the plan itself then be unobjectionable; if the reasoning be just; if the calculations and results should be found unexceptionable, we are justified in looking, if not with certainty, at least with confidence, to
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the advantages which it offers.—Important as the advantages are which this plan presents, both in the present relief which it affords in a season of great and unprecedented difficulty, and in the prevention of those future evils which the unlimited operation of the sinking fund must ultimately occasion, yet its principal benefit consists in the impression which it must make both in this country and out of it, where it will be seen that without any further material pressure on the resources of the country, and by a perseverance only in its wonted exertions, parliament now finds itself enabled to meet with confidence all the exigencies of the present war, to whatever period its continuance may be necessary, for maintaining the honour and independence of the empire.—Our enemy indeed may still continue to consider our subjugation practicable, while he thinks our resources for war can be exhausted; what neither diplomatic artifice, nor military power have been able to accomplish, he may still look forward to as the result of the continued and aggravated pressure of taxation: but here too we possess the means of parrying the mortal blow, and defeating the favourite pursuit of insatiable ambition. If no interval of repose is to be allowed to the harassed world, unless accompanied by humiliation and by servitude; if new schemes of aggression, conquest, and tyranny, are still to desolate Europe, it will be found that Great Britain wants not the means to maintain the contest to the last; that her resistance will be proportioned to the efforts that are employed to subdue her, and her exertions unremitted till peace can be obtained in consistency with her honour, her security, and her independence. God forbid, sir, that any thing coming from me should be so far misconstrued or misunderstood as to convey an impression that I meant to contend that any situation however prosperous, any system of finance however plausible, any temptation to war, if such temptation could be supposed for a moment to exist, should lead us to protract its evils longer than we may be compelled to do by the injustice of our enemy. Far from me be any such assertion or any such idea. Let our enemy employ his power in destruction, if it shall continue to be so permitted; to us it belongs to use the means with which we are entrusted to protect and to save, to defend ourselves from this wide-spreading pestilence, and to support those to whom

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our assistance a may yet be useful. Disclaiming therefore every idea of employing the resources we possess to protract the evils of war, disclaiming entirely any intention to assert that an improved system of finance ought to operate as a motive to impair the resolution to which I trust we shall invariably adhere, of earnestly and industriously embracing every occasion that may serve to restore to the world the blessings of peace, I may yet be allowed to say that it will be not a little satisfactory to reflect that if we should again fail in our future, as we have failed in our past attempts to accomplish that great work, we have amply the means of continuing the war, if war shall be unavoidable. It nothing can bring our enemy to moderation—if nothing will satisfy him short of the destruction of all that remains of independence in Europe, it is consoling to reflect that if we cannot at once subdue our present difficulties, we may at least survive them. (Hear! hear!)—By combining and applying the great resources which the state of the country now affords, we may at least hope from our efforts, that if the devouring flame which already has laid waste the fairest portions of the world, should be still permitted to spread its destructive influence, blasting all that it reaches, and threatening all that it approaches, we, through the excellence of the institutions under which we live, and the blessing and protection of an overruling Providence, may walk unhurt amidst the conflagration, and transmit to our posterity and the descendants of those continental nations which have been accustomed to look and may again look to us as the last bulwark and defence of liberty and law, when invaded by tyranny and violence, the most important and sacred trust that it was ever the lot of man to guard and preserve, the splendid inheritance we have derived from our ancestors, the undiminished glory and independence of our country, and last and best of all, the pure and unsullied faith and honour of the British character and name.—The noble lord concluded with laying the following Resolutions on the table, and proposed that the consideration of them should be adjourned till Wednesday se'nnight:

RESOLUTIONS.
"That the several duties of customs granted to his majesty by 43 Geo. III. c. 76, by 44 Geo. III. c. 53, and by the 45 Geo. III. c. 39, and also the several du-
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ties of excise granted to his majesty by the 43 Geo. III. c. 81, and by the 46 Geo. III. c. 42, shall be further granted and continued, and shall be payable in such proportions, and for such further terms as may be directed by any act or acts of parliament hereafter to be passed for defraying the charge of any loan or loans to be charged thereupon in manner hereinafter mentioned, that is to say:—That on every loan to be raised on the credit of the said several duties, or any of them, and charged thereupon, there shall be set apart, out of the produce of the said duties and appropriated to the consolidated fund of Great Britain, an annual sum equal to ten pounds per centum on the amount of the sum to be raised by every such loan, out of which annual sum the interest and charges of the management of such loan shall, in the first instance, be defrayed, and a sum equal to the residue thereof shall be paid in each year, by equal quarterly payments, into the Bank of England, and placed to the account of the commissioners for the reduction of the national debt, and shall be by them applied in the purchase or redemption of such public annuities, charged on the consolidated fund of Great Britain, as they shall deem most expedient, until by the operation thereof an amount of capital stock of such annuities, equal to the capital stock created in consequence of every such loan respectively, shall have been purchased or redeemed; and that whenever and so soon as such amount of capital stock shall have been so purchased or redeemed, the aforesaid annual sum shall be at the disposal of parliament."

"That the several duties granted to his majesty on the profits arising from property, professions, trades, and offices, by the acts of 43 Geo. III. c. 122, 45 Geo. III c. 15, and 45 Geo. III. 65, shall be applicable in like manner for defraying the charge of any such loan or loans, so long is the said duties shall continue payable by virtue of the said acts, and no longer."

"That the total amount of any loan or loans to be so raised and charged shall not exceed the sum of 16,000;000 l. in any one year, or of 210,000,000 l. within 14 years from this time."

"That any further or supplementary loan or loans which may be necessary for the service of any year beyond the loan or loans so charged as aforesaid on any of the several duties above-mentioned shall

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be raised on such terms, and subject to such conditions of redemption as are hereinafter specified, videlicet, that an annual sum, equal to one per cent. on the capital stock created in respect of every such supplementary loan, shall be issued in equal quarterly payments to the commissioners for the reduction of the national debt; or that other provisions shall be made by parliament for redeeming the same within 45 years from its creation; and every such loan may be charged upon any duties to be hereafter granted or appropriated by parliament for such purpose, or on any temporary annuities which may expire, and become applicable by parliament, conformably to the provisions of an act made in the 42d of Geo. III. c.71."

"That in consideration of the large amount which by the effect of the foregoing Resolutions will be applicable to the redemption of the National Debt, beyond the sums which, in consequence of any law now in force, would be applicable thereto; it is reasonable and expedient that the provisions of an act 32 Geo. III. c. 55, so far as relates to the redemption of the several public funds created or to be created subsequent to the year 1802, and also that the provisions of an act 42 Geo. III. c. 71, so far as relates to the redemption of the several public funds therein mentioned, should be so altered and amended as may be necessary for giving effect to the principles of the said acts, in such manner as may, under the present circumstances, be most beneficial to the public interests."

"That it is expedient, that whenever the whole of the sums applicable to the reduction of the National Debt, by virtue of any act or acts now in force, shall have accumulated to an annual amount exceeding the amount of the interest payable in respect of all such public redeemable annuities, created at any time previous to the 5th day of January, 1807; as shall then remain unredeemed, the excess of such annual sums above such interest shall be at the disposal of parliament, and may be made applicable to the charge of any loan or loans thereafter to be raised into such other public service as parliament may direct, but in such manner and to such extent only as shall always leave an annual sum applicable to the reduction of the National Debt, sufficient to redeem every part thereof, which existed previous to the 22d day of June, 1802, within 45 years
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at the utmost from the said 22d day of June, 1802; and also sufficient to redeem every part thereof created subsequent to the said 22d day of June, 1802, within 45 years at the utmost from the date of its creation."

"That whenever the annual sums applicable to the reduction of the National Debt in respect of any loan or loans to be charged as aforesaid in the several war duties before mentioned, shall exceed the amount of the interest payable in respect of such part of the capital stock created in respect of any such loan or loans which shall then remain unredeemed, the excess of such annual sums above such interests shall be at the disposal of parliament in time of peace, but not in time of war, and in such manner and to such extent only, as that an amount equal to the capital stock created by every such loan respectively shall always be redeemed within 45 years from the date of the creation of such loan."

"That whenever the annual sums applicable to the reduction of the National Debt, in respect to any such supplementary loan or loans as aforesaid, shall exceed the amount of the interest payable in respect of such part of the capital stock created in respect of any such loan or loans as shall then remain unredeemed, the excess of such annual sums above such interest, shall be at the disposal of parliament, but in such manner and to such extent only as that an amount equal to the capital stock created by every such loan respectively shall always be redeemed within 45 years from the date of the creation of such loan."

"That for the purpose of ascertaining the due execution of the regulations provided by the above Resolutions, separate accounts shall be kept by the commissioners for the reduction of the National Debt, of all public funds, or securities purchased, or redeemed by the sums vested in them by virtue of any act or acts now in force, or by such sums as shall be vested in them, in respect of any loan or loans charged on the aforesaid war duties, or any of them, or in respect of any Supplementary loan or loans to be raised as aforesaid; provided nevertheless, that the said several sums may be applied indiscriminately in the purchase of any such public funds or securities, as the said commissioners may think expedient."

"That an account shall be taken,

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and laid before this house, of the net produce of all the permanent taxes for three years, ending the 5th day of January, 1807; adding thereto an estimate of the future annual produce of such of the said taxes as have not been in full receipt during that period, with an average thereof; and if the net produce of those taxes in the years ending the 5th day of January, 1803, 1809, and 1810, shall in the average of those three years exceed such former average, such excess, or any part thereof, shall be at the disposal of parliament, and applicable to the charge of any loan or loans thereafter to be raised, or to such other public service as parliament shall direct, and so on successively in any future years, if the excess of such taxes on an average of three years shall exceed the first average by more than the amount of any sums which may then have been charged thereon; but if on any such three years average there shall appear any deficiency below such average, together with such additional charge aforesaid, such deficiency shall be made good by parliament."

"That an account shall be annually taken, and laid before this house, of the net produce of the several war duties aforesaid, and upon an average of three years, from the 5th day of January, 1807, the annual net produce thereof shall have fallen short of 21,000,000 l. Such deficiency shall be made good by parliament, and so on successively in any subsequent year, in which any loan or loans shall be created and charged thereupon in manner aforesaid."

Mr. Rosesaid, he would not detain the committee at present, as any observations upon this plan would come better afterwards. He only wished to suggest, that the annuities which the noble lord mentioned as one of the means for carrying this measure into effect, had been already actually applied by law to the Sinking Fund.
Lord Henry Pettyobserved, that the right hon. gent.'s recollection failed him. It was true, that in 1786 they had been applied as he stated, but in 1802 they had been detached from this purpose. The debate would more properly take place after the Resolutions were printed; and besides the Resolutions, there was a set of Tables illustrative of the different forms and modes in which the plan he had just detailed would operate, and of which, although they could not be regularly laid
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on the table of the house, he would take care that every member should be provided with a copy. [See Appendix to the present volume.] Conscious as he was, that in the speech he had just had the honour of making to the house, many particulars had been omitted, and many things obscurely stated, he declared it would give him pleasure to afford every possible information to the house on the subject.
Mr. Johnstone,although he allowed that it would be preferable to postpone the debate until after the Resolutions should be printed, yet thought one short observation necessary; because, if the impression made by the speech of the noble lord were allowed to go abroad, the country might be induced to entertain an opinion which could never be realized. The noble lord had displayed great talents and great eloquence, and the display of those talents and that eloquence had been clearly evinced by his leading the house, at such a moment as the present, when the Income tax pressed so hard upon the necessities of the people, and when every alleviation of the burthens imposed by that tax had been so unprecedentedly and so steadily refused, to listen to a detail of the mischiefs which would arise from the payment of the national debt and from the relief from all their taxes. All the noble lord's conclusions proceeded on the supposition that the annual expenditure of the country would not exceed 3S millions. Grant him that, and the rest followed. What had been the consequence of a similar hope held out at the beginning of the war, namely, that the war could be carried on without any increase of debt, by the operation of the Sinking Fund? He was sure that he should not be suspected of derogating from the character and talents of the noble viscount (Sidmouth) then at the head of his majesty's government, for whom he entertained the highest respect; but undoubtedly the result of those expectations was, that in the fourth year of the war, our debt had increased 50 millions on account of England, and 17 millions on account of Ireland; being at an average rate of 17 millions annually. He feared that a similar result would follow the noble lord's calculations. The noble lord had omitted to consider the necessary enhancement that must take place in the price of every article required for the service of the country. He had made no allowance for that which was inevitable, the situation of

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the continent, which would call for essential aid from this country. There was another point which must immediately cause the total failure of the plan. This was the state of Ireland. The charges of a civil nature in Ireland amounted to 3,800,000 l. while the whole receipt of the exchequer did not exceed 3,670,000 l.; it would therefore be out of the power of Ireland to raise within herself the interest of the 5 millions. The noble lord had totally omitted to notice what must be the result when the two exchequers of England and Ireland should be united. Then the whole of the interest of the 5 millions must be raised in England, as Ireland was unable to do it within herself. Many other points might be mentioned, but these were enough to induce the house and the country not to be too sanguine in their expectations of being enabled to carry on the war for 20 years, without incurring any additional burthens. It was an expectation that could never be realized, and the disappointment of the people would render them more prone to complain of the privations to which they must necessarily be subject. He could not resist saying these few words, even under the disadvantage of the impression that had just been made by the noble lord's eloquence.
Lord H Pettyalluding to that part of the hon. gent.'s observations which related to Ireland, said, that the hon. gent. must be aware that the finances of Ireland rested on a footing totally distinct from those of England; that the system, therefore, with regard to the war taxes could not possibly at present extend to that country.
Mr. Hiley Addingtonobserved, that after the able speech of his noble friend, he would not have troubled the house had it not been for the allusion to his noble relation, made by the hon. gent. His noble relation had only said, that supposing the expenditure not to exceed 20 millions, the war might be carried on without additional taxes. This he had before stated in answer to the hon. gent. who had, on a former occasion, brought the same charge against his noble relation.
Mr. Parnellin the absence of an hon. baronet (sir J. Newport), who had been compelled by indisposition to leave the house, declared, that owing to the exertions made in Ireland during the last year, the revenue of that country had been increased half a million. A few years ago the revenue of Ireland was little more than a million; it now amounted to nearly four
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millions. The increasing trade, and the abolition of injurious restrictions, would probably soon augment this revenue, and make the annual income of Ireland bear the same proportion to her annual expenditure, as the annual income of Great Britain did to her annual expenditure.
Mr. Corry,from the experience he had in Irish finance, was also of opinion that they were in a very promising state. He thought, therefore, that the hon. gent. ought to be more guarded in his expressions, lest he should convey a wrong impression on the public mind. The noble lord, whose statements were so clear, and who had opened a plan which would be satisfactory to all the world, except the common enemy of all, had justly observed, that his system was not applicable to Ireland at present, whatever it might be afterwards.
Mr. Johnstonemeant no reflection on the management of the Irish finances. As to the prediction of lord Sidmouth, his argument still held good, for that noble lord had assumed that the expenditure would not go beyond 26 millions, and the noble lord opposite also assumed that it would not go beyond 38 millions. The grounds of the former prediction had failed, and so might those of the present.—The chairman then reported progress, and obtained leave to sit again on Monday se'nnight.