Sitting of 12 March 1828

SAVINGS BANKS.
Mr. Humesaid, that on a recent occasion he had moved for returns of the accounts of Savings Banks, from the period of their establish-

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ment to the present year. He now intended to resume the subject for the purpose of submitting certain motions, in continuation of those he had already brought forward. The money of the depositors in these banks was vested with government, who paid interest at the rate of 4l. 11 s. 6d. per cent. In this manner government had, in ten years, received 2,835,774 l., and paid 3,323, 401 l.; so that the public had lost by this arrangement no less than 487,627 l. The loss which government was sustaining by those banks might be estimated at 1,000 l. weekly. He was sorry that he had not, three years ago, moved for the appointment of a committee on this subject, or aimed at a repeal of the Savings' Bank bill. He was at that time, however, informed by the chancellor of the Exchequer, that a remedy for the evil was in contemplation. Was this loss to be suffered in the present financial condition of the country? The object for which those establishments were formed had been widely departed from. The bill should be repealed for two reasons; the progressive loss to the country, and the great surplus which the managers always had in possession untouched. This surplus in the Newcastle Savings' Bank, was at present 48,000 l. The Devon and Exeter Bank was another example of the system on which those concerns were now managed. He thought no time should be lost in abating an evil so prejudicial to the state. For deposits amounting to 15,000,000 l., government had, within eleven years, paid the full price at which the money was invested by those who deposited it. On a change of the price of stock, government might lose three or four millions, while the depositors would be entitled to the same sum in any event. Now, he considered that they ought to be placed in precisely the, same situation as other capitalists who had money to invest. There was another point, which he hoped would be taken into consideration by the hon. member for Surrey; he meant the mismanagement of the officers intrusted with the business of the banks. The hon. member then moved for a return of the amount of interest paid by the commissioners for the reduction of the National Debt, and placed to the credit of the respective Saving Banks, from the period of their first establishment up to the 20th of November, 1827. He likewise moved for similar returns connected with those banks.
Mr. Dawsonsaw no objection to the consideration of a subject so important. The hon. member had stated the nature of the system fairly and correctly, and it certainly did seem to require some reform. But he thought there was no necessity for entering on any further details at present; particularly as the subject had been taken up by the chancellor of the Exchequer, who would bring forward some measure for the regulations of these banks during the session.
The motions were agreed to.

IRISH VAGRANTS.
Lord Stanleyrose to move for a select committee to take into consideration the state of the laws relating to the passing of Irish Vagrants to their own country. The subject was one of great importance to the county of Lancaster, which was at considerable expense in passing Irish vagrants; and he thought the House would agree that it was hard that one county should be put to extraordinary expense, and feel the pressure almost exclusively, in consequence of its local situation. It would appear from the returns, that the numbers passed yearly were very considerable. In 1818, the numbers passed were 6,614; in 1819, 6,138. In 1823, there was an apparent reduction on the face of the returns; but it was only apparent, or if real was owing to temporary causes, as would appear from the subsequent increase. In 1823, the numbers were 1,337; in 1824, 3,043; in 1825, 3,358; and between June 1826, and July 1827, the numbers were 7,988. In fact, the evil had amounted to such a height, that something ought to be done to relieve the county of Lancaster from the burthen imposed upon it from this cause. His intention was, to move for a select committee, to inquire into the subject; and he thought the sooner they met the better, in order that they might decide what sort of returns they would require from the different counties, to enable them to enter into the merits of the case. His lordship concluded, by moving for the appointment of the said committee; which was agreed to.

PROMOTIONS IN THE ARMY.
Mr. Humerose to call the attention of the House to the novel, injudicious, and ruinous mode of proceeding at present adopted with regard to Promotions in the Army. The House was aware that up to the 2nd

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of May, 1825, officers were not permitted to sell their half-pay; but at that period a change had taken place, by which they were enabled to do so; and, in 1826, he had called for a return of the officers who had availed themselves of the permission to sell. But, in addition to the order to which he had already alluded, the commander-in-chief had issued another, on the 25th of April 1826, allowing officers to sell their half-pay commissions to officers of an inferior rank on the full-pay. On moving for a return of the officers who had availed themselves of this privilege, he had obtained documents which would show the great loss sustained by the country under the new arrangement. The hon. member here entered into a variety of calculations with a view to show the loss sustained to the country by the sale of commissions of old officers to young men. By this course of proceeding, annuities, amounting in the aggregate to near ten millions were outstanding. By the first return, it appeared that a sum of 656,785 l. was lost in consequence of one year's sale of commissions. He should cite the cases of lieut.-colon el Cunyngham, John earl of Lisburn, and a variety of other officers, who, after having served a few years, had been placed on half-pay, after which they had been some twenty, some thirty, and some even forty years on half-pay, and had then sold out to young men who had been but a short time in the service. There were other cases in which lieutenants and ensigns had sold out to young men who had never seen a single day's service. He had made a similar statement on a former occasion, but then the House appeared satisfied with the answers given by the noble Secretary at War. They would, however, now perceive how far they had a right to be satisfied with those answers.—He next came to the second return, from which it appeared, that an increase of expenditure had been incurred to the country to the amount of 1,513,000 l. by the new system. It was no wonder that large establishments should be kept up in the office of the commander-in-chief and the office of the Secretary at War, when such an extensive correspondence was carried on with both those departments. The House would bear in mind, that from the two returns to which he had alluded, seven hundred and sixty-five officers had been allowed to sell out; and looking to the calculation he
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had made, it would be found that not less than 72,636 l. had gone into the hands of the Bank of England. He thought, that when the king could not raise 100 l. without coming to that House, it was too much that private individuals should have it in their power to tax the country in this way, and add, at least, a million and a half to its expenditure. If this system were to go on—if every officer was thus to do as he pleased—he thought the noble lord opposite would have much to answer for. It was very possible, however, that the noble lord would satisfy the House by making a counter statement, a sort of set off, as he had done before. But the House should bear in mind, that those who sold out were on the old pay, while those who came in, came in upon the new. He thought the House should appoint a special committee to inquire into these abuses. He gave the case to the House as he found it; and he must say, that it would be impossible to expect any reduction of this portion of our burthens, if young men were to take the place of old ones in this way. He would venture to say, that if an inquiry was made into the French half-pay, the whole amount paid in that way would be found to be a mere pittance, compared to what was paid in England. The French half-pay list had been diminishing since the peace; while we had been obviously adding to ours. He had asked, upon a former occasion, what decrease might be expected to take place in the half-pay? and he had been told a decrease of about five per cent on the average. But although the noble lord had taken credit for relieving the country to that extent, the fact was as he had stated it. The House ought not only to call for the continuance of those returns, but to appoint a special inquiry, when he was sure they would agree, that the effect of the present system was, to promote young men, but not to provide for those who had grown grey in the service, as they were originally taught to expect. Such, he would contend for it, was the result of the system upon the service [hear, hear!]. He had consulted many officers on the subject, who agreed with him in that opinion. At all events, he had done his duty in bringing the subject before the House. The hon. member concluded by moving for a variety of returns relative to the sale of half-pay by officers in the army.
Sir James Grahamsaid, the speed of his hon. friend had disclosed to the House a source of profligate expenditure and of corrupt influence, which required to be checked without delay. His object in rising, was merely to ask the noble lord opposite to give a negative, as he hoped the noble lord could, to questions which he was going to ask him relative to two particular circumstances. He had been given to understand, that a certain officer in the army, who had been employed in the civil service of the country for the last fifteen years, and so employed that he was not allowed, by the rules of the military service, to receive his half-pay, had been allowed, after a lapse of fifteen years, in which he never received a farthing in virtue of his military commissions, to dispose of his half-pay. By that arrangement, a charge, which had had no existence for the last fifteen years, had been thrown upon the public. Now, did, he wished to know, this gentleman still continue in his civil employment? The other question which he had to ask related to a similar transaction in Ireland, where a military officer who had been in the civil service for the last eight years, and whose half-pay had consequently been suspended during that time, had also been allowed to sell his half-pay? He was sure it would be most satisfactory to the House, if he should prove to have been misinformed; but unless the rumours he had alluded to could be positively contradicted, he trusted that some member would move for a committee of inquiry, with a view specifically to inquire into the state of the half-pay, and to ascertain the extent of these disorders in the army.
Lord Palmerstonsaid, he had no objection to grant the returns called for. He could not, however, but express his surprise that the hon. member for Montrose should seize the present opportunity for going into such details and calculations; for he should have thought that matters of that sort, connected as they were with the army estimates, would have been referred to that committee of finance of which the hon. gentleman was himself a member. He would leave it to the gentlemen who formed that committee, to deal as they thought proper with the opinion which the hon. member had expressed of them, if not in words, at least by inference—an opinion which went the length of telling the country, that they were not
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likely persons to inquire with advantage into such transactions. Whether the hon. member thought that it would answer his object better to make an inflamed statement to the House, before he referred his papers to a committee, he could not pretend to say; but he thought he might say, that the Finance Committee had sent for papers connected with it, in order to come to a satisfactory conclusion upon it. What led the hon. member to be so impatient to make his statement to the House before he had ascertained the correctness of the facts on which he rested it, the hon. member could best explain. This, however, he would say, that it was impossible that any statement should produce a more erroneous impression than that which the hon. member had made. Every one who heard the speech of the hon. member would suppose that by a certain arrangement the public had incurred a loss of 2,000,000 l.; but whether the hon. member meant that it had incurred a loss of 2,000,000 l. capital, or of 2,000,000 l. a-year, he defied any person who heard him to understand. The nature of the arrangement was shortly this:—At the conclusion of the war a reduction of the army necessarily took place; a great many officers were placed on half-pay, and their situations in the army, which became vacant on the full-pay, were regularly filled up by officers from the half-pay. That system went on progressively till the year 1827. It was then found that it had the effect of stopping promotion in regiments, and of continuing officers in situations for which their increasing age rendered them more unfit. The army had become as it were stagnant, and it was found necessary that some additional scope should be given to promotion. The arrangement proposed for that purpose was this:—certain officers of certain rank were allowed for a certain period to sell their half-pay commissions to officers of an inferior rank on the full-pay who might be inclined to purchase them. The consequence of it was, to remove old officers from their regiments, and to give a scope to preferment amongst the younger officers, who remained behind. As young captains on full-pay, in many instances, bought the commissions of old majors on half-pay, the charge on the half-pay list he admitted increased. The loss to the public was incurred in this manner:—a major who might live fifteen years, was

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was succeeded by another major who might live twenty-five years, and thus the public was saddled with an annuity which was likely to continue for a long time. The period had not, however, yet arrived in which the hon. member could affirm that any loss had been hitherto sustained by the public; for as yet the public had only to pay the same half pay as before; and it would not be till the expiration of the ten years that the public would have to pay the annuity exclusively to the younger life. He admitted that if there were no other check besides those which he had already mentioned on this arrangement, the public would be pledged to the payment of these annuities beyond the time to which they were originally designed to extend. But the arrangement did not stop here. Who were the persons who purchased these annuities? Those officers who were well provided with money. Was it to be supposed that an officer of fortune would buy a commission which would place him on a half-pay, if he had no other chance than that of being shelfed by such a proceeding? No; the object for which men of fortune invested their capital in these annuities was to obtain promotion. Let the House look, not merely to the probability, but to what was the fact on this subject. A major who had a half-pay commission, sold it to a captain on full-pay; the captain then became a major on half-pay, and wishing for employment looked out immediately for a full-pay major, with whom he might effectuate an exchange: so that by an intermediate change it often happened, that one old major on the half-pay list was succeeded at one remove by another major equally advanced in years. He would therefore recommend to the hon. member to make his motion embrace a return of those officers who had bought half-pay, and had afterwards exchanged into full-pay— He would now ask the House to consider what was the result of this arrangement, even upon the showing of the hon. member himself. The sellers obtained the old price for their commissions, and the purchasers paid the new: and it appeared that in that manner the public had already received a sum of 72,000 l. Against this gain on the part of the public was to be set the loss which it had incurred by having to pay a certain number of annuities which would commence ten years hence, and would last ten years after they
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had commenced. Now, what annuity to begin at the end of ten years, and to last for ten years afterwards, could you purchase for 72,000 l. He should suppose a large annuity indeed. Therefore, if that second exchange, of which he had just spoken, had not taken place, the calculation on the amount of the number of pounds lost to the public would not rest entirely upon the probable duration of the lives of those who purchased the half-pay being greater than that of those who sold it. If, however, the House would take into consideration the effects of the second exchange, it would see, that in all probability no pecuniary loss would be suffered by the public.—But leaving the question of loss to the public out of consideration, he would now ask what effect this arrangement had produced upon the army? It had given it an active establishment; it had provided it with efficient officers; it had given it a character for activity and efficiency, which was of the utmost advantage to the public service. It was on that ground that he had originally proposed the arrangement to parliament. It was not propounded by him as a measure of pecuniary advantage, but as a measure which was likely to conduce, and which he would say had conduced to the efficiency of the service. He would here observe, that the hon. member had pushed his argument so far in one direction that night, that he did not perceive how far he had strengthened the arguments which it had been his (lord P.'s) duty to address to the hon. member's understanding upon former occasions. The hon. member had frequently reproached those who had the disposal of the patronage of the army, with not having filled up the vacancies which occurred on the full-pay with officers taken from the half-pay. On those occasions he had as frequently said, that though there were many officers on the half-pay who would be willing enough to serve, the House deceived itself if it supposed that those officers were therefore fit and competent for service. He had said, that there were not only colonels and majors, but lieutenants and ensigns, who, from their length of service could not be again brought with any useful effect into active service. The statements which he had then made were received by the hon. member with a degree of incredulity which it would have been difficult to account for in any other member. Now, what turned out to be the

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fact, even on the hon. member's own showing? That the hon. member, when he reads through the half-pay list, finds that there are not only colonels and majors, but even lieutenants and ensigns, who have been on the half-pay for thirty or forty years. Ought such men as those to be put upon full-pay, and to be called into active service? He repeated, with considerable pride and satisfaction, that the hon. member had furnished him with the most favourable corroboration to the arguments which he had formerly used, in answer to the censures which the hon. member was so fond of flinging upon those who were intrusted with the patronage of the army. The hon. member then asked, "Is it not unjust to allow persons who had been so long on the half-pay list to sell their commissions at all?" To this he answered, that so long as those persons lived, they must remain a burthen on the public. Was it not, therefore, an advantage to enable them to retire and to supply their places with officers who could be called into active service without danger? He would not pretend to follow the hon. member through all the cases which he had that night mentioned to the House. The question ought to be decided upon principle and upon principle alone. If the principle were wrong, it would not be made worse by mixing it up with individual cases; and if right he would take his stand upon it at once. An hon. baronet had asked him whether there were not two cases in which military officers, who had been long employed in the civil service, had been allowed to sell their half-pay. He would reply, that of the case in Ireland, he knew nothing; there was, however, a case in which the circumstances of which the hon. baronet complained had taken place in England. And here he would observe, that he objected generally to allowing half-pay to be sold by any person who held a civil office: but there was one case in which the party on entering upon his civil employment had received an assurance from the head of the department, that he should be allowed to dispose of his half-pay. That assurance was given under the erroneous impression, that commissions of that sort might be sold according to the ordinary rules of the service. That party subsequently satisfied the Treasury that he had incurred, in consequence of that assurance, certain expenses which he would not otherwise have incurred. It
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was upon that ground alone, that he had been permitted to sell his half-pay. It was an exception, which stood upon its own grounds, and which did not at all affect the general principle. He was not prepared to say that there were not one or two cases in which a sale of half-pay might not have taken place before he had learnt that the party held a civil employment; for the House must be aware that he had no means of learning how every military officer in the empire was employed. It had undoubtedly happened that individuals had sent in applications to be allowed to dispose of their half-pay, and that those applications had been agreed to, before it was discovered that they ought to have been refused. In one of the cases to which he alluded, he had ordered the sale to be stopped; but unfortunately his order was given too late. He would, however, say, that in all cases in which he had learnt that the party who applied to sell his half-pay held a civil appointment, he had decidedly objected to permit the sale. An hon. friend of his, whom he then saw in the House, could speak to one case, in which he had felt himself bound to deal out hard justice to a meritorious officer. The hon. member had stated, that this arrangement was the cause why the half-pay list had not diminished since 1817. The hon. member, when he made that statement, ought to have recollected, that since that year large reductions had taken place in the army; and that it was one objection to a change of system, that reductions in one department of our expenditure always became a source of increased expense in some other department of it. The officers who were taken from the full-pay, were of course placed upon the half-pay; and hence it happened, that as the amount of full-pay diminished, that of half-pay increased. He thought it only just to the memory of the illustrious individual who lately filled the office of commander-in-chief—he meant the duke of York—to state that when a great augmentation to the army took place a few years ago, he filled up all the commissions which it became necessary to grant, with names of officers taken from the half-pay. He had now stated to the House the grounds upon which the arrangement had been made. The expense of it, he repeated, was distant and reversionary, and they had to set against it the large sum which had been paid down as the price of the commis-

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sions. He did not think that the public would be losers by it; but even if they were losers in point of pecuniary expense, they would be gainers by it in point of the greater efficiency which it had already given to the army.
Mr. Maberlyrecommended the House to refer this matter to the consideration of the Finance Committee, which he had no doubt would investigate it satisfactorily. He knew that this arrangement had been productive of great benefit to the army; but whether that benefit had been purchased by the country at too great an expense, he could not pretend to decide.
Mr. Calcraftapproved of the arrangements which the noble Secretary had spoken of, as he thought they were such as to increase the efficiency of the army. The army had been improved by the opportunity afforded to young officers to obtain promotion. If the system recommended by his hon. friend had been followed, when war had come, the army would have been officered only by old gentlemen. His hon. friend really put the House out of humour with economy, by his plans for beggaring the service under pretence of reforming it. He was as anxious as his hon. friend for economy; but he would first of all have the establishment on an efficient footing.
The motions were agreed to.

LIFE ANNUITIES ACT.
On the motion of the Chancellor of the Exchequer, the House went into a committee upon the Life Annuities Act, when the right hon. gentleman moved an instruction for leave to bring in a bill to give effect to the recommendation of the Finance Committee, by repealing so much of several acts as empowers the Commissioners for the reduction of the National Debt, to grant Life Annuities.
Lord Althorperose to support the motion, which was absolutely necessary. The facts were shortly these: a statement had been laid before the Finance Committee relative to the financial condition of the country, drawn up in a very able, clear, and satisfactory manner, by the right hon. the Master of the Mint. It appeared, by this exposition, that these annuities had been sold at a considerable loss to the country. The evidence on which this statement was founded, was a letter from Mr. Finlayson to the Treasury. By this letter, the toss to the public was represent-
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ed as going on at the rate of 8,000 l. a-week, and the total loss during the last three months was stated to have amounted to 95,000 l. Mr. Finlayson stated, that he had made representations of this loss to lord Bexley, so long ago as 1819, and afterwards to lord Goderich. It was very unfortunate for the country, that these inquiries had not been followed up, as it was beyond all doubt, that however exaggerated Mr. Finlayson's case might be, the transactions had been highly disadvantageous to the country. They could not undo what had passed, but they should prevent loss for the future.
Leave was given to bring in the bill.