Sitting of 26 April 1815

MOTION RESPECTING BALANCES IN THE HANDS OF THE BANK OF ENGLAND, &c.
Mr. Grenfellsaid, he understood that the production of the Papers, which he had moved for on a former evening, respecting the Balances of Public Money in the hands of the Bank of England, would no longer be opposed by the right hon. gentleman opposite. He did not feel it necessary at present to enter at any great length into the subject; but he hoped the House would indulge him a very few minutes while he submitted one or two observations to them. It had been stated the other night, by the right hon. the Chancellor of the Exchequer, that by far the greatest proportion of the Public Balances in the hands of the Bank of England would be found, on examination, to be derived from the Consolidated Fund, and that they were, therefore, beyond the control of the Public. To this doctrine, if by the, control of the public was
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meant the control of the Executive Government, be cordially acceded. But it would not be contended for by the right hon. gentleman, that the public monies, emanating from the public, and consigned in the Bank of England as the bankers of the public, were also placed out of the control of the House itself. He would allude to a particular instance of the exercise of this control by the House; he meant, in the case of the money deposited in the hands of the Bank for the payment of the public dividends. In 1791, Mr. Pitt, having reason to think that there was a great accumulation in the hands of the Bank of England of unclaimed dividends, made a claim for a portion of them in the name of the public. This claim was resisted by the Bank, as a breach of faith with the public creditor. But Mr. Pitt had the firmness to persist; the Bank were obliged to give way, and 500,000 l. was then taken from the funds in the hands of the Bank, and applied to the public service. In 1798 a similar arrangement took place, by which 500,000 l. was again applied to the public service. After he had stated this, he could not see that there was any thing to preclude the Legislature from making any arrangement respecting the. public money in the hands of the Bank, they might think fit, whether emanating from the Consolidated Fund, or any other source. He had been asked by the Governor of the Bank, what measure he intended to found on the Papers in question, if the House should grant them? It would be a sufficient answer if he were to say, that it would be premature, if not presumptuous in him, were he to state what he intended to do with those papers before examining them. But if the amount of balances in the hands of the Bank were now what they were in 1807, that is, between 11 and 12 millions, he had no hesitation in stating, that he should endeavour, either by a reduction of the balances or by some regulation, to make them productive of interest and advantage to the public. Whether he should propose any such regulation himself, or leave it to persons better qualified, or whether he should be precluded by the Bank Loan Act from making any such attempt, were questions with which he would not then occupy the House. But he had no hesitation in giving it as an opinion, not hastily adopted by him, that some regulation was practicable, nay easy, provided the Bank of England, taking an enlarged view

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of its public duty should lend itself to the object. Nay, the object was practicable even on the supposition that the Bank of England should be so far unmindful of the duties which it owed to the public, as to oppose the arrangement. He hoped, after what he had now said, that no gentleman would contend that there was any thing impracticable in the application of this regulation to the balances in the hands of the Bank of England; and provided along with this there should be a reduction of their charge for the management of the public debt, the effect would be to produce a saving of between five and six hundred thousand pounds per annum, which was equal to the interest on a loan of ten millions, still leaving an ample and liberal allowance to the Bank of England. He wished to allude to one other point, the statement of the income of the Bank of England, derivable either from the transactions which they carried on for the public, or as shown from the documents on the table of the House. The first head of the income of the Bank was that derived from the circulation of their paper. The amount of this circulation at one period was not less than 31 millions; but he was aware that the amount had been reduced. He was not, however, giving an-exaggerated statement when he fixed the average at twenty-seven millions. He took the income from this source at 1,390,000 l. The next head of income was the balances in the hands of the Bank. The amount in 1807, was 11,500,000 l. Deducting 3 millions, lent to the public without interest, there remained in their hands 8,500,000 l. The profit from this was 425,000 l. The third head was that which they were paid for managing the public debt. He had already stated this at 267,000 l. to which must be added an allowance for a house, of which he did not know the meaning, of 4000 l. making in all 271,000 l. The fourth head, consisting of interest paid by the public to the Bank, amounted to 330,000 l. The amount from all these sources was 2,376,000 l. He had confined himself to all those sources of income, either derivable from the public, or appearing in the papers before the House, without any reference to their private business. The hon. gentleman concluded with moving, that there be laid before the House the following Papers: 1. "An Account of the Balances of Cash in the hands of the Bank of England on the 1st and 15th days of each
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month, between the 1st of February 1807 and 1st of April 1815, inclusive, resulting from payments under the head of Customs, and of all other branches of the public, revenue, stating the average balance in each year, made up from the said days. 2. An Account of the Balances of Cash in the hands of the Bank of England on the 1st and 15th days of each month, between the 1st of February 1807 and the 1st of April 1815, inclusive, resulting from the Postmaster-general's account with the Bank, stating the average balance in each year, made up from the said days. 3. An Account of the Balances of Cash in the hands of the Bank of England on the 1st and 15th days of each month, between the 1st of February 1807 and 1st of April 1815, inclusive, belonging to the different departments of the Government, including the Balances of the Accountant-general of the Court of Chancery, and stating the average balance in each year, made up from the said days. 4. An Account of the Exchequer-bills and Bank-notes deposited by the Governor and Company of the Bank of England as Cash in the chests of the four Tellers in his Majesty's receipt of Exchequer on the 7th of August 1807, and on every 28th day subsequent to that period, down to the 1st of April 1815. 5. An Account of the Balance of the Account of the American Commissioners, and of all other Public Balances not particularly specified in the four preceding Accounts with the Bank of England, on the 1st of January in each year, from the year 1808 to the year 1815, inclusive; distinguishing the amount under each head respectively. 6. An Account of the total amount of Unclaimed Dividends in the hands of the Bank at the periods immediately preceding the payment of the quarterly dividends since January 1807. 7. An Account of all other Allowances made by the Public to the Bank, or charged by the Bank against the public, not specified in an Account respecting the charge for the management of the public debt, ordered to be laid before the House on the 19th instant, for transacting any other public service in the years 1813 and 1814, describing the nature of the services and the amount charged thereon in each year respectively."
The Chancellor of the Exchequerwas disposed to coincide in the motion. The hon. gentleman's statement of the profit of the Bank was exaggerated; he had not allowed for a great variety of charges.

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With respect to the analogy contended for in the case of unclaimed dividends, it did not hold. The amount of such dividends might be called" dead cash, and could by no arrangement become the property of the Bank. Government were the supposed general heirs in all such cases; whatever had no claimant, was considered to belong to the public at large.
Mr. Ponsonbysaid, the agreement which had now taken place between the two sides of the Mouse, had been anticipated by him from their approach to one another in point of numbers on the late vote. He did not think that for a long time a motion had been brought forward so likely to produce solid benefit to the public. He hoped it would be understood that there was no disposition to infringe upon the agreement actually subsisting between Government and the Bank; but he hoped it would be understood also, that no new agreement would be entered into till the House had an opportunity of considering these papers.
Mr. Mellishsaid, he had voted against the production of the accounts, only because he thought it unjust and unfair that the Act passed so late as March last, by which the public faith was pledged, should be in any iota disturbed.
Mr. Peter Mooresaid, it was a most preposterous proposition, that the public should be obliged to gay the Bank interest for three millions lent to them out of their own money, and leave a balance of nine millions besides. Such a doctrine did not suit the present times, when all classes were borne down by the weight of taxes, The hon. gentleman then went into the consideration of the audit of the public accounts, for which 60,000 l. was paid, with-out preventing an accumulation of the unaudited accounts.
Mr. Manningsaid a few words upon the security the Bank possessed in an Act of Parliament, which pledged the faith of the House.
Mr. Baringexpressed his wish that the subject should be postponed to the next session. He complained that Mr. Grenfell's statements were exaggerated.
Lord A. Hamiltonsupported the motion.
Mr. Marryattthought it the duty of the House to take care that the Government did not enter into disadvantageous engagements with the Bank.
Mr. Grenfellshortly replied, denying that be had ever intended to interfere with the contract now subsisting with the Bank.
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He admitted that the expenses of the establishment of the Bank were to be deducted from the profits, but could not agree with the Chancellor of the Exchequer that it was necessary for the Bank to hold one shilling in reserve to answer demands; for those demands were always paid in paper since the passing of the Restriction Act.
The motions were agreed to.