Sitting of 7 April 1859

MINUTES
. PUBLIC BILLS.—1° Confirmation and Probate Act (1858) Amendment); Convict Prisons Abroad.
2° Pauper Maintenance Act Continuance; Naval Medical Supplemental Fund Society Annuities, &c. Act Continuance; Railway Tickets Transfer.
3° Tramways (Ireland); Superannuation.

THE STATE OF EUROPE AND OUR FOREIGN RELATIONS.—NOTICE.
VISCOUNT PALMERSTON: I beg to give notice that I shall to-morrow, on the Motion that the House do adjourn (and, if necessary, I shall move the adjournment), make some observations on the state of our Foreign Relations, and ask the Government to state, as far as may be consistent with their public duty, what is the present position in which this country stands, either as mediator or as negotiator, in regard to the discussions now going on either at Paris or elsewhere in regard to the affairs of Italy and Europe in general.
COUNTY COURT PRISONERS.

  QUESTION.
  MR. HUGHESsaid, he would beg to ask Mr. Attorney General what steps (if any) have been taken to prevent the practice of imprisoning Debtors who are confined under judgments of County Courts in a Remand Ward; and if any inconvenience would arise by making the rule applicable to Fraudulent Debtors, and not to mere cases of contempt for non-payment.
  THE ATTORNEY GENERALsaid, that since a question had been asked of his right hon. Friend the Home Secretary on this subject inquiries had been made into the matter, and he was informed that the Law Officers of the Crown three or four years ago had expressed their opinion that the prisoners under this Act could he treated as persons guilty of misconduct, and be subjected to severe restrictions. On looking at the Act of Parliament he found that there was certainly a power, when Insolvent Debtors came before County Court Judges, and it was proved they were guilty of fraud or making away with their effects, to subject them to that rigorous imprisonment; but County Court Judges had also the power of imprisoning persons who answered the Court in what was deemed an unsatisfactory manner, and the

  1509
  practice of County Court Judges in some cases had been to imprison those who did not give a satisfactory answer as to the non-payment of money. He had instituted an inquiry into the administration of justice by the County Court Judges, and should consult his right hon. Friend the Home Secretary with reference to making an alteration in the rules with regard to the treatment of County Court Prisoners. He was of opinion that none but Fraudulent Debtors should be imprisoned.

TENANT RIGHT.—QUESTION.
MR. GREERsaid, he rose to ask the Chief Secretary for Ireland whether the proposed Tenants' Compensation Bill for Ireland will be laid on the Table of the House before the Prorogation of Parliament; and also whether he has obtained any explanation with regard to the eviction of the Rev. Doctor O'Fay?
LORD NAASsaid, two Bills had been prepared—one a Leasing Powers Bill, and the other a Bill for amending the Law of Landlord and Tenant in Ireland, but it would be impossible to lay them on the Table during the present Session. At the earliest possible moment, however, after the meeting of the new Parliament they would be forthcoming. With regard to the second part of the question, such an explanation had been received.
MR. J. D. FITZGERALDsaid, he wished to know whether in substance the two Bills referred to by the noble Lord were the same as the two which had already been before the House, and whether the Government contemplate introducing a Tenants' Compensation Bill?
LORD NAASsaid, the Leasing Powers Bill was very much the same, and the second Bill included a Tenants' Compensation Clause, but of course he could not state then what the nature of the proposal would be.

NATIONAL SCHOOLMASTERS IN IRELAND.
MR. LEFROYsaid, he would beg to ask whether the attention of the Government has been directed to certain observations of Baron Greene, when passing sentence upon Sullivan (one of the Masters under the National Board) as convicted of being engaged in a conspiracy to dethrone Her Majesty, &c., where his Lordship stated, "I regret to say the evidence tends
1510
to show that others concerned with you in this guilty conspiracy have also been Schoolmasters intrusted with the education of the youth of this country;" and whether it was the intention of the Government to require the Commissioners of the National Board to institute a careful inquiry into the moral character and conduct of all the Schoolmasters now employed by the Board in the care and instruction of the youthful classes of the Irish people. He would also beg to ask the Irish Secretary what he proposed to do with a very important Bill which had stood for yesterday, and was postponed till next Thursday. He alluded to the Ecclesiastical Court and Registry Bill.
LORD NAASreplied, that it was not the intention of the Government to proceed with the Ecclesiastical Court and Registry Bill. The remarks of Baron Greene had been brought under the notice of the Irish Government, and it was the intention of the Lord Lieutenant to draw the attention of the Commissioners of the National Board to them.

SUPPLY.—REPORT.
MR. FITZROY brought up the Report upon Supply, upon which
SIR GEORGE LEWISobserved, that some discussion took place the day previous on the Vote of £2,000,000 for the payment of Exchequer bonds falling due in May next, and it was understood that some explanation would be given to-day by the right hon. Gentleman the Chancellor of the Exchequer as to the intentions of the Government with regard to this debt, and that the House would be informed whether it was intended simply to pay off these bonds and hereafter to ask for power to renew them or create a debt in some other manner of equivalent amount, or whether it was intended to defray the sum out of the Ways and Means of the year, without asking for power to create an equivalent amount of debt.
THE CHANCELLOR OF THE EXCHEQUERsaid, he had intended to make his usual financial statement on Monday next; but it was now impossible, in the peculiar circumstances of the House, to make that intended statement. The House would admit that it would be unfair to press him to make anything like a partial statement at the present time; but with respect to this particular Vote, he begged to state that, by the arrangements which he had

1511
made, and which he trusted on a subsequent occasion to have an opportunity of submitting to the House of Commons, it was his intention to pay off these bonds entirely—definitively to pay them, and not to renew them, and not to borrow money in any other form with that object.
MR. W. WILLIAMSsaid, he wished to inquire whether the Chancellor of the Exchequer had a surplus of revenue to the amount of £2,000,000 to pay off the bonds?
THE CHANCELLOR OF THE EXCHEQUERsaid, that the hon. Gentleman, if he should be present when he made his statement, would then have the opportunity of criticising it with his usual acumen; but at present he would content himself with saying that he should pay out of the Consolidated Fund this engagement of the country when it became due.
Resolutions agreed to.

SUPPLY.—NAVY ESTIMATES.
Order for Committee read.
House in Committee.
(1.) Question again proposed—
"That a sum, not exceeding £450,000, be granted to Her Majesty, on account, towards defraying the Charge of Wages to Artificers, Labourers, and others employed in Her Majesty's Naval Establishments at Home, which will come in course of payment during the year ending on the 31st day of March, 1860."
Question put, and agreed to.
The following Votes were also agreed to:—
(2.) £15,000, on account, Wages to Artifices and others, Naval Establishments Abroad.
(3.) £700,000, on account, Naval Stores.
(4.) £180,000, on account, New Works, &c.
(5.) £15,000, on account, Medicine and Medical Stores.
(6.) 22,000, on account, Naval Miscellaneous Services.
(7.) £350,000, on account, Half-pay, &c. to Officers of Navy and Royal Marines.
MR. LINDSAYsaid, that the First Lord of the Admiralty had intimated his intention of bringing forward some plan dealing with the retirement list, and he wished to know whether anything had been done in respect to that plan.
SIR JOHN PAKINGTONsaid, he could only answer the question in the terms in which he expressed himself when he introduced the Navy Estimates. He had
1512
a plan in contemplation with respect to naval promotion and retirement; but the magnitude and importance of the subject was such that he could not venture to submit the proposal to the House except after very great consideration. He hoped to be able to bring the subject, with other contemplated improvements in the Navy, before the House shortly after the meeting of the new Parliament.
SIR CHARLES NAPIERsaid, that Parliament had been extremely liberal already in respect to retirement; and the consequence was, that a great many good officers, some much younger than others remaining in the service, had been put out of commission. He, of course, could not tell what the First Load of the Admiralty contemplated, but he hoped that the House of Commons would not agree to give a single sixpence more for retiring allowances, because the steps taken already were ample.
Vote agreed to, as were also the following Votes on account.
(8.) £240,000, Military Pensions and Allowances.
(9.) £80,000, on account, Civil Pensions and Allowances.
(10.) £70,000, on account, Victualling and Conveyance of Troops, Army.
(11.) £300,000, on account, Packet Service.
SIR CHARLES NAPIERsaid, that he should like to see this charge taken away from these Estimates altogether. The Packet Service was much more connected with the Post Office than the Navy, and the money ought to be provided for under that head.
SIR JOHN PAKINGTONsaid, he was quite of opinion that the Vote ought not to belong to the Navy Estimates, with which it had really nothing to do. It was formerly connected with the Post Office Estimates, and he confessed he thought it ought to be so still.
MR. WILSONsaid, he thought that whatever department had the management of the packets ought to have the control of the Vote, and it would never do, where the packets were so large, and required so much skill, that the Post Office should have the control of the Vote. He quite agreed that this Vote ought not to be included in the Navy Estimates to swell the amount, but he hoped that the Admiralty would not divest itself of duties so well performed as were the duties of the packet service.
SIR JOHN PAKINGTONsaid, that of course he must submit if there was a reason for attaching this Vote to the Navy Estimates, which must then continue to be swelled out by an expenditure with which the naval service had nothing to do.
MR. WILSONsaid, he would suggest that the best way to correct the evil would be to make this vote a Treasury Vote.
MR. MOOREsaid, he hoped to see the day when contract packets would no longer be maintained, but when ships belonging to the Royal Navy would be employed in the mail service under the command of merritorious officers, to whom such employment would be a reward, and a nucleus would thus be formed for keeping up an efficient force of seamen, who would be available in case of necessity. No less than £1,000,000 was now expended annually upon the mail contract service, which might be applied in such a manner as to secure a reserve of able and experienced seamen, who might at once be available in case of emergency. One of the conditions of the mail contracts was, that the ships employed in that service should be fitted in such a manner and should be of such strength as to be capable of carrying the heaviest guns used in Her Majesty's Navy, but he believed that out of the immense fleet of vessels employed as contract packets there was not one which was fitted for carrying guns according to the contract. He hoped this subject would receive the attention of the right hon. Baronet the First Lord of the Admiralty, and that an end would be put as soon as possible to the present system of contracts. Such contracts might be advantageous in establishing new communications, but he held that when trade was once opened to any part of the world the continuance of a system of subsidies was most injurious to the public interests. He believed that not one of the companies who supplied contract packets paid back to the Post Office in revenue the amount they received for the contracts. He had seen it stated that £30,000 was paid annually for carrying the South American mails, and that the revenue returned was £32,000; but this contract was merely a rider to another contract of £240,000 for carrying the West India mails, and he should like to know what were the postal returns upon that contract.
SIR CHARLES NAPIERremarked, that he did not concur in the views of the hon. Gentleman. If our men-of-war were devoted to the conveyance of letters alone to
1514
different parts of the world, the expense of the service would be much greater than under the contract system; while if they were also required to carry passengers, the consequence would be that the packets would become floating hotels, and naval officers would be turned into hotel-keepers. This had been the case under the old system, but he hoped it would never occur again.
SIR GEORGE PECHELLsaid, he was anxious to call the attention of the First Lord of the Admiralty to the valuable invention of Captain Kynaston, R.N., for lowering boats from the quarter and stern of ships when going fast through the water, by which means many lives might be saved. The value of the invention had lately been demonstrated on board Her Majesty's ship Euryalus (the vessel in which Prince Alfred was serving), when, a seaman having fallen overboard off Alexandria, the boat was lowered in a strong wind and heavy sea, the ship going eight knots through the water, and the man was saved. He (Sir George Pechell) wished the right hon. Baronet to obtain, and lay on the table a report of the different trials made of Captain Kynaston's disengaging hooks, and, as rewards were given for valuable inventions for the destruction of life by means of explosive materials and large guns—as baronetages, and perhaps peerages, were the rewards of such inventions, it was certainly expedient that some due acknowledgment should be awarded to those who had projected the means of saving life. Captain Kynaston was suffering from wounds sustained in the Crimea, and his case was in every way deserving of consideration.
SIR JOHN PAKINGTONobserved, that he was afraid the gallant Admiral had misunderstood what he (Sir John Pakington) had said on a former occasion. He had not said that the invention was now under the consideration of the Lords of the Admiralty, but that the experiments upon, and trials of the invention were not yet completed, and that the Admiralty were not yet in possession of any report on the subject. He sympathized most sincerely with Captain Kynaston under his sufferings, which were the results of valuable services rendered to his country, and he also felt grateful to that gallant officer for the endeavours he had made to bring to perfection a most useful invention for the preservation of life. He heartily hoped, for the sake of the gallant officer, that his invention might prove successful, but he

1515
was not at present in a position to produce the report for which the hon. and gallant Member for Brighton had asked.
Vote agreed to.

SUPPLY—ARMY ESTIMATES.
(12.) £150,000, on account, Clothing and Necessaries.
MR. W. WILLIAMSsaid, he wished to call attention to the expenditure incurred for the clothing of the Guards as compared with the regiments of the line. The annual cost of the clothing of the Horse Guards was £8 15 s. 2d. per man, while the cost of cavalry of the line was £5 8s. per man. The annual cost of clothing for the Foot Guards was at the rate of £4 2s. 8d. per man, and for the line of £2 6s. 3d. per man. The cost of the Guards was, therefore, very nearly double that of regiments of the line, and although he wished to see the army properly clothed, he thought the Committee ought to know the reason of this difference.
GENERAL PEELsaid, that he was surprised that the hon. Gentleman should find matter for complaint, as there was no difference whatever in the clothing of the Guards for this as compared with previous years; but there had been a reduction of £5,000 under this head. He did not think much fault could be found with the cost of the clothing of the army when the line were supplied at only £2 6s. 6d. per man per annum. On the whole Vote there was a decrease this year of £289,460 as compared with 1858–9. A portion of this decrease was occasioned by the fact that they were enabled to dispense with the large store which was formerly necessary, and that the number of free kits now issued was much less than formerly. The only difference between the present and the old system was, that the clothing was supplied by the War Office instead of by the "clothing colonels." The same contractors were engaged, and the cloth was of very good quality.
GENERAL CODRINGTONremarked, that he had heard an hon. Gentleman, a member of the Contracts' Committee, say that the change to what was called the Weedon system had cost this country at least £100,000 a year, besides destroying the responsibility which used to prevail in regard to the clothing. But the system had again been changed; the War Office now made the contracts direct with the different firms, and the responsibility, in-
1516
stead of attaching as formerly to the "clothing colonels," devolved on those contractors, whose good name would, of course, suffer if any complaints were found necessary.
Vote agreed to; as were also the following Votes.
(13.) £12,000, on account, Rewards for Military Service.
(14.) £35,000, on account, Pay of General Officers.
(15.) £240,000, on account, Pay of Reduced or Retired Officers.
(16.) £90,000, on account, Pensions to Widows of Officers, &c.
(17.) £20,000, on account, Pensions and Allowances to Wounded Officers.
(18.) £13,000, on account, Chelsea and Kilmainham Hospitals.
(19.) £550,000, on account, Out Pensioners Chelsea Hospital, &c.
(20.) £60,000, on account, Superannuation and Retired Allowances.
(21.) £30,000, Buildings, &c., Rifled Ordnance Factory, Woolwich.
GENERAL PEELobserved, that a supplemental arrangement had been made to be met by this Vote of £30,000 for the establishment at Woolwich of a manufactory of Sir William Armstrong's guns under his immediate superintendence.
VISCOUNT PALMERSTONsaid, he wished to ask what had been done with regard to the large mortar invented and made by Mr. Mallet. He understood that there had been several trials of this weapon, that in the main it had succeeded, and that, though parts of the mortar had at different times given way, these defects had been on each occasion remedied. At the last experiment one of the stays which held together the segments of which the mortar was compounded, being more tightened than the other stays, and having therefore to bear the whole strain of the explosion, gave way, but another stay was ready, and that accident was no proof whatever of failure. Hitherto, he understood, the mortar had not been tried with a full charge calculated to produce the greatest range of flight, and as yet no experiment had been made, by burying one of the shells to the depth to which it would probably penetrate when falling loaded at the end of its flight, and then exploding it while so buried, in order to see what would be the extent of the crater which the explosion would produce. He thought it exceedingly important that the weapon should be tried to the utmost, and

1517
he wished to know, therefore, whether these trials had been made, and, if not, what reason existed for not carrying the experiments further, so as to ascertain the applicability of the mortar for warlike purposes.
GENERAL PEELsaid, he had had no notice of the question, and therefore he could not enter into so full an explanation as he could wish when speaking merely from memory; but as far as he recollected, an expense of nearly £13,000 had been already incurred in the trial of this mortar, and the last report of the Ordnance Committee was to the effect that they did not consider it advisable to continue these experiments. He did not say that the experiments should not be renewed, but at the present moment the Ordnance Committee did not think it advisable to incur any further expenditure in this way. He would, however, put himself in a position to be able to give the noble Lord a more circumstantial reply.
CAPTAIN VIVIANsaid, he wished to inquire whether the Government intended to persevere in their determination to send out twelve batteries of Artillery to India. The noble Lord the Secretary for India the other night had stated such to be their intention; but he had given no sufficient reasons for sending out so large a force at this period, when the rebellion was at an end, and there was no longer any enemy in the field. He thought that there would be a great risk incurred in the sending out twelve batteries of Artillery. He should wish to know whether the Government were or would be prepared, on some future occasion, to enter into a more detailed explanation upon this subject.
GENERAL PEELsaid, a requisition had been made by the Indian Government for twelve batteries of Artillery; but the noble Lord the Secretary for India and the Council for India, having duly considered the matter and the present state of our Eastern Empire, decided upon sending out only half the amount of the force required. It was deemed absolutely necessary to have a larger force of European Artillery than of Native. The proportions of the European and the local force were regulated by the report of the Indian Commission.
CAPTAIN VIVIANsaid, as he understood the requisition, it was for twelve batteries, without the guns — that they simply wanted the men in India. He believed that there were plenty of guns out in India as well as stores of all kinds.
GENERAL PEELwas understood to say that some large batteries had already gone out.
COLONEL SYKESobserved, that when the requisition for those batteries had been made, the rebellion was raging in India, and that there was no prospect of its being immediately quelled. Now, however, that India lay prostrate at our feet, and that her financial embarrassments were so great, it was, he thought, highly inexpedient to encumber her with an additional force of 3,000 men, who would be obliged to go into cantonments, and would be insufficiently provided with barrack accommodation.
SIR HENRY WILLOUGHBYsaid, he believed that the cost of British Artillery in India was not greater than that of European artillery in India. He thought that the Government ought to take care that no unnecessary expenditure should be incurred under the present embarrassed state of the Indian treasury.
SIR DE LACY EVANSsaid, he wished to know what was the date of the requisition which had been referred to. For his own part, he was of opinion that even one-half of the twelve batteries in question ought not to be sent out to India. Nobody who was acquainted with the subject could for one moment doubt the efficiency of the artillery employed by the East India Company, to the admirable quality of which both the late Lord Hardinge and Sir Charles Napier had borne testimony. He could not help thinking under those circumstances that there were strong objections to the discontinuance of the local artillery in India. [General PEEL: Nobody proposes to do that.] He was under the impression that it was proposed to discontinue the European Artillery now in India, and if he were right in that view he should beg the gallant General to bear in mind that any artillery force which might be sent out from England to supply its place must, for a time, be comparatively inefficient, owing to the non-acquaintance of the officers and men with the language and habits of the Natives. He might also observe that during the recent rebellion 400 pieces of cannon and about 1,000,000 stand of arms had been taken from the enemy, that 800 forts had been destroyed—so that the fact, in reality, was that the artillery in India was in excess of what was required. That being so, it would, bethought, be a most unwise proceeding at a moment when the aspect of Europe was so ominous to send out even the reduced number of thirty-

1519
six guns, as he understood was now proposed. For his own part, he strongly objected to the diminution of the artillery force in this country by even a single gun, and he should suggest the expediency of postponing compliance with the requisition of the Indian Government on the subject until the report of the Commissioners on Army Organization had been received and considered. If Her Majesty's Ministers were to act otherwise, and carry out their present intention, he must say that they would, in his opinion, commit a great blunder. Having said thus much on that point, he might he permitted to draw the attention of the Government to the circumstance that the policy of establishing, at a great expense, an iron foundry at Woolwich for the manufacture of large cannon was open to much doubt. There was a considerable number of similar establishments in the country which furnished excellent cannon of that description at a fair price, and, besides, there was a large number of those guns in store. The foundry to which he alluded was, therefore unnecessary, and he should suggest that instead of being maintained for its present purpose, at an expense of £150,000, it should be handed over to the use of Sir William Armstrong.
LORD STANLEYsaid, he thought some misapprehension prevailed as to the reason why it was in contemplation to send out the Artillery in question to India. As far as he could gather from the observations of the hon. and gallant General, he seemed to suppose that it was intended to send it out as a force in excess of that which had existed in that country before the mutiny. Such, however, was not the case. The fact was, that a large portion of the Native Artillery of Bengal had mutinied during the recent outbreak. A deficiency had therefore been created in that province in that particular arm of the service, and in August last Viscount Canning had written home a statement of his opinion as to what ought to be the amount of the Artillery force which should be maintained in India. Now, if there was one point in reference to which there was a greater concurrence of opinion among military authorities both at home and in India than another, that point was that the great bulk of the Artillery in that country should be European, and not Native. It was necessary in the judgment of the Governor General to fill up the void caused by the desertion of the Native Artillery of Bengal. There was no question that that would be filled up by Europeans,
1520
but there was a question whether it should be supplied by a local European Artillery or by a reinforcement of the Artillery of the line. So far from prejudging the Report of the Commission, the course which was pursued had been expressly intended to avoid prejudging the matter. There was already a certain amount of the Royal Artillery serving in India, and to increase the force to some extent was not at all introducing a new principle, and the only question was whether the addition should be local or Royal Artillery, or how much of each. Pending the Report of the Commission, it was determined in a manner to compromise the matter, and to supply the immediate, and at that time pressing demand of the Indian Government by sending out a nearly equal proportion of Artillery of the line. Since that time, however, the state of India had so improved beyond what could have been expected in August last, and the military condition of India was very satisfactory, while, he regretted to say, the financial condition was just the contrary. For both these reasons the Government had determined, although their decision had not yet been announced to the Indian Government, to reduce the number of Artillery to be sent out by one-half. With respect to the guns, he might observe that they were not to be sent out. The guns were in India, and would be handed over to the troops on arrival in that country.
SIR DE LACY EVANSasked the date of the requisition.
LORD STANLEYsaid, it was a Minute of the Governor General, dated in August last.
SIR ERSKINE PERRYsaid, he heard with regret from the noble Lord that he had not complied with the real requisition of the authorities in India which, as he understood, was only to recruit for the local European Artillery from this country; and that the Government were going to send out six batteries of the Royal Artillery to India. It was quite true that a large proportion of the Native force had mutinied; but we had still all the officers remaining true. The intention of the Government, if carried out, would entail a heavy charge upon India. Now, all military authorities concurred in saying that the Indian Artillery was the best in the world. We had this skilled Artillery in India at present, and also officers there who were men of twenty and twenty-five years' standing. The young officers who were going out to

1521
India were men, perhaps, of twenty-three to twenty-five years of age, whose presence there would have the effect of stopping all promotion. He trusted that before the close of the Session they would have the Report of General Hancock. All that was wanted in India were the troopers and gunners to complete the complement of the Indian Artillery.
LORD STANLEYobserved, that even if the twelve batteries originally intended had been sent out, the force of Artillery in India would still be below the usual amount before the rebellion.
COLONEL SYKESsaid, he would remind the noble Lord that the void caused in the Bengal army by the destruction of the Native Artillery had been already supplied. He hoped for the sake of the finances of India that the Government would not persevere in their intention.
SIR DE LACY EVANSsaid, he wished that they had received some further explanation before the Vote was agreed to.
GENERAL PEELhoped that he should be able to lay upon the table of the House before its prorogation the report of the Commission upon the Organization of the Army in India. He thought it would not be right to prejudge the question by entering into details before they had seen the report. With respect to the hon. and gallant General's proposition to hand over Woolwich gun factory to Sir William Armstrong, he (General Peel) could not give his assent. So far from there being an excess of guns on hand he could assure the Committee that requisitions for 68-pounders from many of our most important garrisons still remained unfulfilled.
SIR DE LACY EVANSsaid, he thought the Government was practically prejudging the question by sending out Artillery before the report of the Commission had been presented. The requisition of the Governor General was made in August, when India was in the midst of a fearful struggle, and the Government were now going to comply with it to the extent of one-half when the war had completely ceased. He believed that even at present there were 133 pieces of the Royal Artillery in India besides the European guns. There were some persons who desired to get rid of the local force altogether, and the public could not help thinking the Government must have some other reasons for the course they were taking than those which they had stated.
GENERAL PEELobserved, that the hon.
1522
and gallant Member had no right to impute improper motives to the Government. Let the gallant General wait until he saw the report of the Commissioners before he accused the Government of acting in defiance of it.
MR. KINNAIRDsaid, he wished to know what was done with the officers of the late Bengal Native Artillery? Were those who were unemployed on full pay?
LORD STANLEYreplied, that he was not aware that there was at present any considerable number of unemployed officers. He apprehended that most of the officers referred to had found employment, some in the new levies and some in civil employ.
COLONEL FRENCHasked, whether it was intended to break up the fine artillery service of the late East India Company.
GENERAL PEELreplied in the negative.
SIR ERSKINE PERRYsaid he must again appeal to the Government to suspend their order for the embarcation of the six batteries until the whole question had been considered and decided.
Vote agreed to.
House resumed.
Resolutions to be reported To-morrow.

SUPERANNUATION BILL.

  THIRD READING.
  Order for Third Reading read.
  SIR HENRY WILLOUGHBYsaid, he rose not for the purpose of opposing the third reading of this measure, but to ask the Government for an estimate of the expense which its provisions would entail on the country.
  SIR STAFFORD NORTHCOTEstated, in reply, that the increase of expenditure consequent upon the passing of the Bill might possibly be £70,000 a year at the utmost, taking into account the additions to be made by taking in a new class of officers, and the possible effect of an alteration in the scale. £40,000 was estimated as the possible addition by taking in the officers of the Post Office, £10,000 by admitting other officers, and £20,000 by an alteration in the scale. The hon. Member for Devonport (Mr. Wilson) who had paid much attention to the subject, originally estimated the total increase in the expenditure at £100,000, but his (Sir S. North-cote's) belief was, that £50,000 would be nearer the truth.
  SIR DENHAM NORREYSsaid, he considered this was one of the most improper and uncalled-for Bills the House

  1523
  had ever passed. It was founded on a promise of a revision of salaries, but that revision had never been and probably never would be, carried out; and yet the Bill would inflict a burden of £70,000 upon the country. He should feel pleasure in having recorded what would probably be his last vote in this Parliament against that Bill.
  MR. DRUMMONDsaid, the Bill was a most improper one, both in principle and detail. If it were just in principle, which he denied, every banker and merchant ought to provide superannuation allowances for his clerks and every private person for his servants.
  MR. WEGUELINsaid, that as one of the Commissioners who had originally investigated this subject, he was desirous of expressing his belief that the Bill contained the only practical conclusion that could be come to upon it. The revision of salaries referred to could only be prospective, as it was almost impossible to reduce the salaries of existing officers. The Bill might throw an additional charge upon the revenue for the present, but ultimately it would result in a saving to the country.
  Bill read 3° and passed.

NEWSPAPERS, &c., BILL.

  COMMITTEE.
  Order for Committee read.
  House in Committee.
  MR. AYRTONsaid, he wished to ask the Government for a statement of their intentions with respect to this Bill.
  MR. SOTHERON ESTCOURTsaid, that when this Bill came on for a second reading his hon. and learned Friend the Solicitor General intimated that there were objections to some of its provisions. There were two classes of legislative enactments with which the Bill proposed to deal. One referred to security, the other to registration. The Solicitor General said as to security there were enactments that had become obsolete from circumstances, or which were never put in force; and his hon. and learned Friend was willing to accede to such provisions of the hon. Member's (Mr. Ayrton's) Bill as dealt with those Statutes or portions of Statutes. But with regard to the provisions under the head of registration his hon. and learned Friend reserved his opinion. Since the second reading of the Bill he (Mr. S. Estcourt) had received a memorial from the Society for Promoting the Repeal of
  1524
  Taxes on Knowledge, very distinctly pointing out the several entries contained under the head of registration, and pointing out how very little security they afforded. He believed they were all agreed that whatever real security existed against the publication of blasphemous, indecent, slanderous, or libellous matter ought to be retained; but that whatever was not necessary to afford such security, and whatever might be classed under the head of "obsolete" ought not to remain on the Statute-book. This was the feeling of Her Majesty's Government. Many of the provisions which the hon. Gentleman intended by his Bill to repeal, were enactments or portions of enactments passed by Parliament to meet special circumstances which no longer existed. Of this kind were the provisions directed against Jacobins. There was, therefore, no reason for maintaining those provisions on the Statute-book. The hon. Gentleman (Mr. Ayrton) desired to know whether there were any parts of several Acts enumerated in his Bill which the Government desired to retain. He (Mr. Sotheron Estcourt) had talked the matter over with his hon. and learned Friend the Solicitor General, and the result was that he could not consent at that moment to the Bill of the hon. Gentleman, for the amount of repeal which it provided for was so sweeping, and it embraced so large a scope of legislation — legislation extending over fifty years—that although on the whole he might not be prepared to point out to the hon. Gentleman what it might be necessary to retain, neither was he ready to say what part of the existing law might be safely abrogated. Therefore, considering the position in which the House at present stood—bearing in mind that even if the Government allowed the Bill to pass through the Commons it could scarcely pass through the Lords previously to a dissolution, he would make an offer to the hon. Gentleman. He would undertake that this matter should be fairly considered during the recess—considered in a spirit not different from that in which the hon. Gentleman himself had approached it—and that if he (Mr. Sotheron Estcourt) had the honour of a seat in the new Parliament he would himself lay a Bill upon the table, preserving whatever the Government thought necessary to be retained, and repealing whatever they thought might safely be dispensed with; or that if he did not bring forward a Bill on behalf of the Government he would communicate

  1525
  with the hon. Member should he (Mr. Ayrton) be a Member of the new House, and put him in possession of the views of the Government on the subject.
  MR. EDWIN JAMESsaid, he thought that the country was much indebted to the hon. and learned Member for the Tower Hamlets (Mr. Ayrton) for having devoted his attention to the matter; and, as Her Majesty's Government had met him in so fair a spirit, he (Mr. James) would take the liberty of suggesting to the right hon. Gentleman the Secretary for the Home Department that, at the most, all that was necessary to be preserved of the existing enactments having reference to newspapers was 6 & 7 Will. IV., c. 76. That statute prescribed registration, and that the printer's name should appear on the publication. Now, as the object of legislation on this subject at the present day ought not to be to clog newspapers with restrictions, he thought that the provision requiring the printer's name to be attached to the publication would be sufficient. Since the establishment of the cheap press attacks on private character had not been known, the conductors of the newspaper press discharging their duties, as journalists of public matters, without invading the sanctities of private life. He would suggest to the Secretary of State for the Home Department that requiring the printer's name to appear on every publication would be all that was really necessary; and that, by abolishing everything else, we should get rid of the machinery which clogged the liberty of the press without producing any practical utility.
  MR. MILNER GIBSONremarked that there was nothing novel in the proposition before the House; for, in 1855, the right hon. Member for the University of Oxford proposed a Bill to abolish both the security and the registration required of newspapers. It was considered maturely by the Government in 1855, and they were prepared to legislate pretty much in the manner now proposed by the hon. Member for the Tower Hamlets. The right hon. Gentleman the Secretary of State would, therefore, find in his department, ready to his hand, all the information that might be required for a consideration of the question. He (Mr. Milner Gibson) submitted that the principle which should be acted upon was this that no rule should be applied to newspapers that was not applied to all other publications. If it were considered necessary that the printer's name should appear on newspapers, let it also
  1526
  appear on all printed papers whatever. They ought not to have a distinct legislation for newspapers, for here had been the stumbling-block, and no court of law had yet been able to decide clearly what is a newspaper.
  MR. AYRTONsaid, that after the suggestion made by the Secretary for the Home Department he should not ask the House to proceed further with the Bill this Session.
  THE SOLICITOR GENERALobserved that all parties were agreed that the statutes which required security to be given ought to be repealed, and that those which required the printer's name to be attached should be retained. The only point for consideration was, whether the law which required newspapers to be registered at Somerset House ought to be repealed or not. He admitted that there were no means of enforcing that law; but, on the other hand, it was possible to provide some better means of registration. He thought the better course for him to take would be to move that the light hon. Gentleman should leave the Chair, which would terminate the Bill for the present Session.
  House resumed. [No Report].

ROYAL WESTERN YACHT CLUB OF IRELAND.

  PAPERS MOVED FOR.
  MR. COGANsaid he wished to call the attention of the House to a letter from the Lords of the Admiralty to the Royal Western Yacht Club of Ireland, dated the 26th day of June, 1858, withdrawing the privilege of wearing the white ensign from that club, although granted them by Royal Warrant, dated the 6th day of February, 1832, and confirmed by letters of the Admiralty of the 30th day of July, 1849, and the 29th day of April, 1853, and ratified by Vote of the House of Commons, of the 29th day of July, 1853, and to move for—
  "Copies of all Correspondence relating to the Warrant granted to the Royal Western Yacht Club of Ireland, especially those in the years 1832, 1842, 1849, 1853, and 1858, and particularly the Admiralty Warrant to the Royal Western Yacht Club of Ireland, of the 6th day of February, 1832, and Letters of the 31st day of July, 1849, the 29th day of April, and the 2nd day of May, 1853; also Letter addressed by the late Maurice O'Connell, Esq., M.P., to the Lords of the Admiralty, and Sir James Graham's reply, dated the 23rd day of May, 1853. Of any Letters or Minutes of any applications made by the Royal St. George's, the Holyhead, or any other Yacht Club, for permission to wear the White Ensign, with the Answers thereto. Of any Memorials or

  1527
  Letters from the Royal Yacht Squadron to the Lords of the Admiralty relative to their claim for the exclusive use of the White Ensign, with the Answers thereto, since the granting of the Warrant to that Club. Of Memorial presented by the Royal Western Yacht Club of Ireland through His Excellency the Lord Lieutenant to the Lords of the Admiralty, with the Reply thereto. And of General Warrants granted to all Royal Yacht Clubs, with the dates on which separate Warrants were issued to the Yacht Owners of the several Clubs, authorizing them to carry the respective Club Ensigns."
  This privilege involved the very existence of the Royal Western Yacht Club of Ireland. That club consisted of nearly 400 members, and possessed about 130 yachts. In 1832 it was authorized by Royal Warrant to wear the white ensign, but by a letter from the Admiralty, dated the 26th of June, 1858, that privilege was withdrawn, on the ground that the white ensign was restricted to the Royal Yacht Squadron. He must deny, however, on the authority of the right hon. Gentleman the Member for Carlisle, that the Royal Yacht Squadron ever had the exclusive right of using the white ensign, and what he wanted to know was, why the Admiralty had revoked the Warrant of 1832. He thought that after all that had taken place it was a harsh proceeding to withdraw the white ensign from the Royal Western Yacht Club of Ireland. It might appear ridiculous to make so much fuss about the matter, but it should be borne in mind that this was a point of honour with yatchsmen. He trusted that the Admiralty would, on reconsideration, revoke the decision at which they had arrived. He concluded by making the Motion of which he had given notice.
  LORD BURGHLEYsaid, he also trusted that the decision would be reconsidered. The club consisted of 200 gentlemen, and they felt it was a harsh proceeding on the part of the Admiralty to withdraw the privilege of using the white flag from their squadron.
  MR. LYGONsaid, that the Admiralty had no objection to the production of the correspondence moved for, and though he could hardly say that they were prepared to reverse the decision arrived at, they would be anxious to meet the views of the hon. Gentleman as far as they could consistently with their duty.
  SIR JAMES GRAHAMsaid, that when at the Admiralty in 1832 he advised that the white flag should be extended to the Royal Western Yacht Club of Ireland, and he was sorry that the decision then come to had been revoked without any allegation of improper conduct on the part of
  1528
  the club being borne out. If the Admiralty reconsidered the matter he hoped that the flag would be given back as the two countries should be treated alike. There should be equality of Royal favour as well as in other matters.
  COLONEL FRENCHsaid, that no reason had been assigned for revoking the permission granted to the Royal Western Yacht Club of Ireland, and he trusted that the white ensign would be restored to them.
  LORD LOVAINEexplained that all English clubs were not entitled to the use of the white flag.
  Motion agreed to. Copies ordered.

FISCAL AFFAIRS (IRELAND.)
SIR DENHAM NORREYS SIR DENHAM NORREYS, who had given notice of a Motion for a "Select Committee to consider to what extent the principle of 'representation of the ratepayers' could be safely adopted in the management of the fiscal affairs of counties in Ireland; and also whether 'poor law unions' might not beneficially be substituted for 'baronies' as fiscal districts," said that the county accounts of Ireland extended to the expenditure of £1,045,000 a year, and the whole was expended under the superintendence of a body in each county of about twenty-three gentlemen, who were selected by the sheriff. Nothing could be more absurd than the present system of expending the public money in Ireland; and, should he be returned to the new Parliament, this would be one of his first Motions. He would withdraw the Motion of which he had given notice.
House adjourned at a quarter after Seven o'clock.

MINUTES.
PUBLIC BILLS.—1a Public Offices Extension; Indemnity.
2a East India Loan; Savings Bank (Ireland) Act.
3a Patents for Inventions (Munitions of War); Common Rights, &c. (War Department).

EAST INDIA LOAN BILL.

  SECOND READING.
  Order of the day for the Second Reading read.
  THE EARL OF DERBY: My Lords, in moving the second reading of the East India Loan Bill I presume your Lordships would hardly wish me to go again over the ground which I traversed a few days ago, in laying before you a revised estimate of the Indian finances, and in stating the increased amount of the deficiency for which it was then calculated that we should have to provide in the course of the ensuing year. I then mentioned the amount to which that deficiency would, in all probability, extend, and what were the means on which the Government of India relied for reducing the estimated deficiency of £ll,500,000 for the year, so that they might require a further assistance from Her Majesty's Government only to the extent of somewhere about £4,000,000. It will also, no doubt, he easily understood by your Lordships that although upon the present occasion I am asking your assent to the second reading of this Bill, I am, in point of fact, only asking what may be considered a giant on account, because, as I have already stated, it will be necessary at a future period to ask for a further sum of

  1475
  about £5,000,000, to make up the whole of the amount which will be required. It was thought better, looking to the approaching dissolution of Parliament, that no time should be lost in passing this Bill, and your Lordships, the other day, kindly showed your willingness to suspend the Standing Orders, so that the fact of its having become law should be conveyed to India by the mail which is to leave this country on Monday next. On this occasion therefore I do not wish to make any lengthened statement; and I shall now proceed to give the best answers in my power to a series of questions which were put to me the other evening by several noble Lords. The noble Lord opposite (Lord Monteagle) asked me what were the intentions of the Government as to the proposal of a vote of thanks to the Governor General, the Commander-in-Chief, and the other officers, civil and military, to whose exertions we are indebted, under Divine Providence, for what I hope I may venture to call the suppression of the late great revolt, and the restoration of a state of what may be regarded, at all events, as a state of comparative peace in India. I have to state upon that point that it is my intention on Monday next to call the attention of your Lordships to that subject, and to move a Vote of Thanks in the terms usual upon such occasions. A noble Duke on the cross benches (the Duke of Marlborough) asked whether it was our intention to recommend to Her Majesty that there should be a public religious manifestation to testify the gratitude of the country to Almighty God for the blessings vouchsafed to our arms: and in answer to that question I have to state that Her Majesty will be advised to issue Her commands to his Grace the Primate to prepare a form of thanksgiving to be read in all the churches and chapels of the kingdom on such day as Her Majesty may think fit to appoint. I come now to a question which was put by a noble Earl below me (the Earl of Ellenborough) who said that he felt some difficulty in comprehending the statement which had been made with regard to the system of deposit for Indian railways to be made in this country, and the general expenditure on that account. My noble Friend is no doubt correct in stating that that is a subject of rather a complicated character; but it is in reality a question of account much more than of revenue; and I hope I shall be able to make the matter clear to my noble Friend and to your Lordships.
  1476
  Your Lordships are already aware that a very large sum has been raised in this country for the construction of railways in India. It is anticipated that the amount paid up here in the course of the next year on Indian railway calls will not he less than £6,800,000, or in round numbers £7,000,000. Now, the course which it has been found desirable for the general convenience to adopt upon that subject is this. The amounts paid on the railway calls are not transmitted to India, there to be employed by the companies on the various works to be completed, but they are in the first instance paid into the Indian Treasury in this country. It is estimated that about 96 per cent of the whole amount embarked in the construction of those railways is held in this country; so that out of every £1,000,000 paid up, £960,000 are paid in this country, and out of these £960,000 there will be required for services performed here about £400,000, and the remaining £560,000 will be expended in India. I am putting out of view at the present moment all considerations of the interest guaranteed to the shareholders; and I am speaking solely of the application of the money that is actually raised. Now, with regard to the £400,000 out of every £960,000 payable in this country, of course it was a matter of convenience that it should never be transmitted to India, but that it should be paid into the Home Treasury, and be there disbursed in proportion to the calls made upon the companies. With regard to the remaining£560,000 the course of proceeding is as follows. Your Lordships are aware that the Government have entered into a guarantee to make up all the interest that may fall short of 5 per cent on the capital expended; and further, that whenever those railways shall return a profit of more than the guaranteed 5 per cent, the surplus is to be divided, one-half between the shareholders, and the other half is to go to the Government in repayment of its guarantee. As yet, the Returns upon the sums that have been expended in those undertakings have fallen far short of the guaranteed interest; and it has been arranged with respect to all work done in India, to the extent of £560,000 out of every £1,000,000 that the capital should not be transmitted from this country, but should be made a charge on the finances of India, while the companies draw to such an amount on the finances of that country as they require for the execution of their works, the Government in the

  1477
  meantime taking in to their hands all the receipts of the Indian railways, and paying over, or rather accounting to the various shareholders, for the dividend of 5 per cent on the capital. This being the case, there is a running account kept, which is settled month by month between the Indian Government in India and the Indian Government at home. Of course, the sum expended in India is set against the sum deposited in this country, and out of the amount which remains in this country the various calls on the Indian Government for the home establishment are met. The result is, that there is no transmission of bullion to India on account of railway shares, and neither are there any remittances from India on account of services performed here. The amount which has been hitherto deposited in this country is so large, that it has been quite sufficient to pay all the expenses of the home Government. The estimate of the sum which will probably be received on this account by the home Government during the year 1859–60 is £6,844,000; on the 7th of April, the balance in hand was £4,366,000; so that there will be £11,210,000 to be applicable to the service of the railway companies in both countries. The portion of that sum, including interest, which will be payable in this country is £5,285,000; and, deducting that sum from the £11,210,000, there will remain a balance of £5,925,000, or, in round numbers, of £6,000,000, available for the home expenditure of the Indian Government. I now come to a different but equally important subject. A question was put to me upon a subject of considerable importance, by the noble Earl opposite (Earl Grey). The noble Earl wishes to know what are the steps which have been taken, or which are in the course of being taken, for the purpose of reducing the great military expenditure of India. I need hardly say, my Lords, that I should indeed take a gloomy view of Indian finances, if we were to regard the expenditure of India during the last few years as one of a normal character. But your Lordships are aware, that the state of things which has arisen during the war is exceptional, and ought not to form the basis of a judgment for the future. I am, however, quite prepared to admit, that of all the modes that can be adopted for restoring the balance between Indian revenue and Indian expenditure, the one in my mind which is most absolutely necessary to
  1478
  adopt, is a reduction of the military expenditure. The force of all arms at present in India amounts to about 112,000 Europeans and 310,000 Natives, including the police. Your Lordships, will, perhaps, be surprised to hear, that at this moment the number of Native troops in India, including the police, exceed by 50,000 the number which was at the disposal of the Government at the commencement of the mutiny. The number was then, I believe, 260,000 and it is now 310,000. I am sure that the views of the Governor General upon this subject entirely coincide with those which we entertain; but we have sent out to him the most urgent representations to effect as large a reduction as he possibly can in the Native troops and the newly-raised levies. That process has already commenced. But it must, of course, be somewhat gradual in its operation. The main reductions which have hitherto taken place, have been effected by the discontinuance of large field establishments against the enemy, by diminishing the number of extraordinary commands and the staff appointments. There may also be a considerable reduction of the troops of the line sent to India from this country. At the present moment there are, I believe, in India, not less than eighty-five of Her Majesty's regiments. In the course of the present year, the Governor General has intimated his intention to send back to this country ten of those regiments that have been longest in India and have suffered most severely during the service. But I must call your Lordships' attention to this fact, that the operation of sending back regiments to this country is an operation not of a single character; it must be considered in a double aspect—first, as bearing upon the expenditure of India; and next, as bearing upon the War Department in this country—unless the sending of them back is conducted upon some regular and well-understood system. Because, as soon as these regiments return home from India they cease to be a charge upon the revenues of India, and they become a charge upon the home service. The consequence is, as your Lordships will understand, that if a large amount of troops were to return to this country without previous notice to, and previous concert with the War Department, it would derange all the calculations submitted to Parliament, and would cause a large increase in our military establishments. But, my Lords, it is of essential importance that some understanding should

  1479
  be come to, and that at no distant period, with regard to the permanent peace establishment of India; and also as regards its composition. On some of these points there are considerable differences of opinion among the Members of the Commission appointed to inquire into that question, all of whom, as your Lordships are aware, are of great experience and authority on Indian questions. The evidence given before the Commission has not yet been printed, nor has the Report been laid before your Lordships. There is one point, however, on which the Commission appears to be unanimous, but on which, I am sorry to say, it is absolutely impossible, in consistency with a due regard to the revenues of India, that we should follow their recommendations. Because, my Lords, it is the opinion of that Commission—and probably a very sound and judicious recommendation, considered in itself—that at all times the proportion of the European troops of all arms present in India should be as one to two, or in some districts as one to three, of the Native troops. But that Estimate was accompanied with this further recommendation, that the number of British troops of all arms to be permanently maintained in India should be 80,000 men. Now, to maintain 80,000 British troops in India, and the corresponding number of Native troops—say 160,000 or 200,000 men—would require an annual expenditure which I estimate would fall little short of £15,000,000; and as your Lordships are aware that the net revenue of India does not exceed £26,000,000 sterling, it must he evident to your Lordships that these revenues could not afford such an expenditure on her army alone, which, it must be remembered, is calculated for a period of profound peace. It is clear, therefore, that some reduction must be made in that Estimate, because the Indian revenues will not bear the expenditure. I come now to another important question, as to the character of the European troops that ought to be employed in the country; and on this point I find there are also considerable differences of opinion. It is the opinion of those officers who are best acquainted with what used to be called the Queen's Service—all the different corps are in the Queen's Service now—that the European force for the service of India should be taken from the regular forces of Her Majesty, and that the line and other corps should serve by turns in India—consequently that the military force of India
  1480
  should be supplied by successive draughts from this country. On the other hand, it is the opinion of those officers who are connected with the Indian service, and have had most experience in India, that it will be necessary to maintain not a large but a considerable body of European troops, raised particularly for the Indian service, and commanded by officers acquainted with the country. I must say the arguments they have brought forward in favour of local European forces, commanded by officers brought up in the service and acquainted with the manners and habits of the people, and with the mode of living in India, are of great weight. And there is this further advantage connected with the formation of such a corps, that it would be attended with a considerable saving of expense, which has been estimated at a reduction of 10 per cent upon the expenditure consequent on the employment of regiments of the line. But against that is to be set the consideration that a local force constantly remaining in the country is subjected to a great deterioration in point of discipline and in point of effectiveness, unless special care is taken to prevent it. If that can be overcome there is great advantage in their employment, because your Lordships will see that a local force levied exclusively for service in India will not require that system of reliefs which forms so heavy an item of expenditure in the employment of regiments of the line—a system which requires us to keep up regiments, that would otherwise not be wanted, to do the duty of those regiments that are unavailable to the service while on their voyage out and their voyage home. I do not presume on this subject to express any strong opinion; but I have certainly formed an opinion that a certain local force is, in point of fact, exceedingly desirable for India, would be a considerable saving of expenditure, and, moreover, would be exceedingly useful in forming a species of link between the Native armies and those troops sent over from this country with no previous knowledge of the country, and no previous knowledge of the habits and discipline of the army. I think, however, if I may venture to pronounce an opinion, that if a local force is to be maintained, it must be maintained subject to the existing engagements with the present officers, and subject to the authority to which a local corps in India is now subject. If there is to be a local corps, there ought, I think, to be every facility for the purpose of assimilating the drill, the discipline, and

  1481
  everything pertaining to the internal management of that corps, as between the local corps and the line. I think, moreover—though this is necessarily a point of great difficulty—that facilities ought to be given, not only for the return home of regiments from India, but also for exchanges between officers of the line and officers of the local European service, in order, as far as possible, to keep up an esprit de corps between them, and to prevent the formation of an injurious rivalry, but at the same time not to repress an honourable competition and emulation between them. However, I only mention these subjects because they must ere long engage the serious attention both of the Government and of Parliament. They are questions upon which there have been very great differences of opinion between high authorities. It has been a question between them whether there should be a local corps at all, and, if there should be, what proportion it should bear to the European force. My opinion undoubtedly is that that proportion should be defined and fixed, and that this country should be guaranteed against an intolerable evil—namely, that of the Indian Government calling, in an extraordinary emergency, upon this country for 30,000 men this year, for 20,000 another year, and for this 25,000 another year, thereby altogether deranging and disorganizing the whole system of reliefs in the British army. Upon the question, as to what proportion the local corps should bear to the European force, there arises considerable difficulty, and I think there will be considerable difficulty in settling points of detail, upon which it will be absolutely necessary that we should have the opinion and advice of the Governor General and of officers of Indian experience. But that is not the point which presses at the present moment. It is in the military expenditure of India that we hope to be able to effect the greatest amount of reduction; and in order to arrive at an opinion of what that expenditure may be reduced to, it would be necessary to come, at the earliest possible period, to a distinct understanding both with regard to the numbers of the military forces and their respective proportions to each other, as an ordinary peace establishment in India, apart from any extraordinary emergency, such as lately happened, and such as, I trust, may not happen again. I think I have given as
  1482
  far as I could an answer to the noble Earl opposite with regard to the stops that have been taken for the reduction of this expenditure when I stated that first there will be a reduction in the extraordinary commands, next that there will be a reduction in the staff; thirdly, that there will be a reduction of the British force in India, and a return of a considerable portion of that force to this country; and, fourthly, that there will shortly be, as I hope, largo reductions in the overgrown Native army by which the finances of India are now so heavily burdened. I am not able to state to the noble Earl how far these reductions have been carried into effect. All I can say is that the attention of the Governor General is anxiously devoted to this subject. He is making every effort in his power to effect reductions; but at the same time I think that reductions, more especially as regards the European force, ought to be made with considerable caution, and not with too great haste. Although I hope that peace is now permanently established, yet I think it is very desirable that we should for some time maintain a considerable and imposing European force to keep the peace, and to assert the predominant authority of this country in India. My Lords, I am not aware of any other points upon which any question was put to me the other day. If there are any I hope I may be able to answer them; but, as your Lordships are aware, I am not very familiar with these subjects of Indian detail. I shall be very happy to give such information as is in my power, and now, without further occupying your Lordships' time, I beg to move the second reading of this Bill.
  Moved, that the Bill be now read 2a.
  THE DUKE OF ARGYLL: My Lords, it is impossible to have listened to the statement of the noble Earl at the head of the Government—that which he made some days ago, together with the farther explanations he has given us to-night—without deriving from it a very serious impression as to the condition of Indian finance. I know that those who sit on this, the "shady" side of the House, are accused of a proneness to take a darker view of all public affairs than that which is presented to us from the Ministerial bench. Yet, serious as the condition of Indian finance undoubtedly is, I feel under no temptation to exaggerate the difficulty, or to take, on the whole, other than a hopeful view of the possibility of overcoming that difficulty

  1483
  with success. That hope is founded mainly on one fact, which cannot he too much pressed on the attention of the House—of the country—namely, that the present great deficit in the finances of India is due, wholly and alone, to the vast military expenditure consequent on the recent mutiny. No part of it has arisen from any failure in the revenue, or from any sudden increase in the expenses of Government. Temporary embarrassment may have been increased by steps taken by the Indian Exchequer, which, whether justly or not, have been severely censured. But, whatever may have been the evil of those measures, it probably admits of easy remedy; and, indeed, by the last account, it seems already to have been in process of removal. But it cannot be denied that the ultimate source of nil the difficulties which beset the Indian Government lies in the vast military expenditure which the suppression of the mutiny has entailed upon the country. I believe it is to a reduction of that expenditure that we can alone look for a possible remedy, and that all other suggestions for meeting the difficulty do but serve to withdraw our attention from the only resource which is available for the purpose. And, first, I cannot help expressing great doubt of the wisdom of the language which is now frequently held as to the connection which ought to subsist, or rather which is said already to subsist, between the Indian and the Imperial Exchequer. I know that the authority of the late Sir Robert Peel has been claimed for this doctrine; but, as it appears to me, without sufficient justification. We must recollect the circumstances under which Sir Robert Peel was speaking in 1842. It had been the settled tradition of the whole Liberal party, and had become, in fact, a popular conviction, that an income-tax was exclusively a war tax; that it was a weapon which no Government was entitled to use, except under that pressure which war alone can exert on the resources of the State. Sir Robert Peel was about to propose an income-tax in a time of peace, at least in Europe, and for no object more immediate or urgent than certain changes in our system of taxation. Naturally Sir Robert Peel, having such a task before him, pressed into his service every possible argument which could be used on the occasion, and, in exposing the existing condition of the finances, took into view every possible contingency which might throw upon them additional burdens.
  1484
  His reference to the East was at the time considered as rather a wide departure from the arguments which were ordinarily considered as having a legitimate bearing on Imperial taxation. But considering the condition of the affairs in the East at that time, when the consequences of the Affghan war were not yet fully known, and considering farther the undoubted truth that any serious calamity in India would undoubtedly throw heavy burdens, directly or indirectly, on the Government at home, I am not prepared to dispute the relevancy of Sir Robert Peel's language in 1842. But the doctrine now held is something far more definite. It is said that there is already a virtual responsibility on the part of the Imperial Exchequer for the Indian debt, and the sooner that responsibility receives legal acknowledgment the better, so as to secure for India the pecuniary advantage arising from the superior credit attaching to an Imperial guarantee. Two questions are obviously involved in the recommendation which this language conveys. First, there is the question of fact, how far it is true that there is any virtual responsibility on the part of the Imperial Exchequer for the Indian debt; and, secondly, there is a question of policy, how far, supposing no such responsibility to exist at present, it would be wise now to assume it for the first time in a recognized legal form. As regards the first of these questions, I can hardly conceive it to be seriously held that the existing Indian bondholders have any claim whatever on the Imperial revenue. They have lent their money on the security of the Indian revenue, and on that security alone. They knew when they trusted that security that it was less good than the security of the British Treasury; and, in consideration of its inferiority, they have stipulated for a higher rate of interest. It is surely impossible to assert that if the security on which they lent should actually fail, those persons would have any moral claim whatever on a wholly different security to which in fact they did not, and in law they could not, look when they entered into the transaction. Nor, practically—if, indeed, the question can be considered as in any degree practical at all—do I believe that the claim would be admitted in the only case in which it could ever be advanced. Let us suppose the case—an extreme case, no doubt, but none the worse on that account for test-

  1485
  ing a principle. Lot us suppose the case—that the late mutiny had been successful, that we had been driven from India, my noble Friend (Lord Monteagle) who has given his support to this doctrine, is an old Chancellor of the Exchequer. He must recollect the feelings and opinions which are connected with the tenure of that office, and I think I need hardly ask him whether he would in such a case come down with much hope of success to the House of Commons, and ask them to add eighty or ninety millions to the national debt of England: a sum of which, it would be necessary for him to explain, some two-fifths were held by natives of India, no longer subjects of the Crown, and all of which had been lent on the security of revenues now lost to our dominion. Does my noble Friend think that this appeal, made under such circumstances, could be made with much likelihood of success. The same argument applies to a deficit which applies to a total loss of India. I very much doubt whether the House of Commons could ever be induced to pay such deficit out of the revenues of this country. It might, indeed, lead to measures being taken for the redress of such a state of things involving great national outlay. But in this sense I do not mean to say, nor can anyone doubt, that the difficulties of India will react most seriously on the Imperial Government. As regards the question of policy, whether it would be wise or otherwise now, for the first time, to extend to the Indian debt an Imperial guarantee, I can only say that it will be time enough to discuss it when such a measure is seriously proposed. Meanwhile it may be sufficient to observe, that the pecuniary advantage to be gained by the operation would probably be much smaller than appears to be frequently supposed. It has been calculated at from £800,000 to one million. I think it very doubtful bow far this amount of difference would be actually realized; but, supposing that it were actually gained, it is unfortunately but a small part of the deficit with which we have now to deal. It has been said that this sum spent as a Sinking Fund would pay off the whole debt in a moderate term of years. But the doctrine of Sinking Funds, not founded on an actual surplus of revenue, has long been abandoned; and whenever the time shall come when the Imperial guarantee shall afford to India such a surplus, we may consider the expediency of the course proposed. It
  1486
  is beyond doubt that whatever might be the pecuniary advantage, there are some political objections, especially in the effect which such an abatement of responsibility would have on the carefulness and foresight of the local Government. At present, however, it is needless to dwell on any other argument than this—that, as a means of escape from our present difficulties, the policy of our Imperial guarantee has no practical importance.
  I pass, then, to another recommendation which I see frequently made, and which not less than the last, I think, tends to direct our attention from the only real remedy—I mean what is commonly called a "development of the resources" of India by public works. I confess I look upon the language with great suspicion, not from any doubt as to the extent of the resources of India, but from a very great doubt how far they can be made available for our present purpose. The resources of India are, indeed, immense, and looking forward to what is, I am afraid, a yet distant future, we may with confidence anticipate a time when the millions of Hindustan will produce and enjoy an amount of wealth compared with which their present condition is poverty indeed. But it would be a fatal mistake to suppose that this is a prospect which can justify present extravagance, or one which will be otherwise than blighted by yearly additions to the debt. The development of national resources is one of "the long results of time." It can best—I ought rather to say it can only—be promoted by good Government and light taxation, and both these are incompatible with an extravagant military expenditure. My Lords, I cannot help thinking that very loose and dangerous notions are abroad on this subject. It seems to be imagined that by a forced application of capital in public works, a fund of unlimited amount may be realized, which will go far to remove all difficulties from the Indian Exchequer. I believe this to be an entire mistake. There are two kinds of public works—those which are undertaken by private capital, under Government guarantee, and those which are directly undertaken by the Government itself with its own funds, and with a view to immediate return. As regards the first of these two kinds of public works, I do not think that the Indian Government can be charged with any indifference to their importance. On the contrary, the Secretary of State and his Council have been blamed for carrying

  1487
  too far the system of Government guarantees. I think that system has been legitimately applied in the case of railways, because works of that magnitude would probably not have been undertaken by British capital on any other condition. But I have great doubt how far it would be wise to extend that system farther. The inevitable effect would soon be that all independent investments of capital would be rendered impossible. No such investments, starting under terms of such comparative disadvantage, would be undertaken in India. I need hardly say that this would he a most injurious result. But, even supposing that it were possible or advisable to extend the system of guarantees, such public works can have no direct effect on the Indian revenue. They may possibly entail an immediate loss, but they cannot possibly afford any immediate gain, because any surplus return over and above the guaranteed amount goes into the pocket of the private capitalists, whilst any deficiency below that amount must be met out of the public funds. Then, as regards the second class of public works, those undertaken directly by the Government, it is beyond doubt that when judiciously selected, they may be and have been in the highest degree remunerative. You may secure good interest on your capital, nay, sometimes such interest as will in a few years restore your capital again. But it is idle to expect that besides this rent, public works can ever yield such a source of income as to redress any part of the enormous adverse balance which is now weighing down Indian finance. Public works will never enable you to bear up against the effect of yearly accumulating debt. And now, my Lords, I come to another resource much spoken of in some quarters, and one which partially, at least, is now being actually adopted by the Indian Government; I mean new taxes. I have always had more belief than many others appeared to have in the possibility of raising new taxes in India, but I deprecate these being spent in meeting, or rather in endeavouring partially to meet extravagant expenditure. You have other more important purposes to which you should apply any increased resources of the kind. Our revenue system in India requires revision, and for the purposes of such revision additional resources are invariably required. I should like to see any new taxes which can be raised in India applied as Sir Robert Peel
  1488
  applied the income-tax hero, in the alleviation of other burdens which press more severely upon the great body of the people. There is a strange discrepancy in the language which is held by different persons in this country in reference to Indian taxation. By some it is affirmed that the Indian people are very lightly taxed, more lightly than ourselves, or than any other European state. By others they are spoken of as ground down under the oppressiveness of our rule, and the weight of the burdens we impose upon them. Cannot we arrive at the truth between these two opposite assertions? I believe we can. It if true that some classes in India are very lightly taxed; nay, it may even be said that they escape taxation altogether. But I believe it to be equally true that the burden of our financial system is severe and presses most heavy on the great bulk of the population. I have seen with surprise an argument maintained, that in considering this question, the land revenue of India must be kept out of view, because that revenue is of the nature of rent, and not of tax. As regards the conclusion aimed at, it is perfectly immaterial whether it is called a rent or a tax. As regards the ability or inability of the people to support other burdens, it comes to much the same thing whether they are overtaxed or over-rented. Rent in a country which is mainly agricultural, is the principal fund which goes to the accumulation of wealth and the support of reproductive industry. Where the whole of that fund is appropriated by the State and expended, all but a fraction, on great armies and the machinery of Government, it is to a great extent withdrawn from those channels in which it would have found more profitable employment. Whatever it may be called, I believe the land revenue of India—everywhere except in the lower provinces of Bengal, where it is light, and where the poverty of the people depends on other causes—to be so heavy in amount as to be a serious burden on the people, and to interfere with their advancement in prosperity and wealth. It has long been the desire and aim of the Government to lighten its burden. I was looking to-day at a despatch sent out some three or four years ago, by the Court of Directors to the Government of Madras, urging on that Government a reduction of the land tax in the provinces subject to its rule. I find it stated in that despatch that at present the proportion of the total or gross produce of

  1489
  the soil absorbed by the land tax was as respects the best or irrigated lands, no less than one-half or 50 per cent, and as regarded other land, fully as much as 35 per cent. Even in the north western provinces, which are considered in this respect a model, the proportion absorbed by the Government is as much as 35 per cent of the net produce. Now, I think it impossible to deny that where so large a proportion of the produce of the soil is absorbed by the necessities of Government, a most severe burden is laid upon the people, and a most serious deduction made from the fund, out of which alone we can hope to see in India an increase in the wealth and comfort of its people. And here, my Lords, I must demur to the mode of estimating the burden or weight of taxation borne by the people of India, which was lately adopted by the Secretary of State for India in his speech in another place. It was said that the average taxation per head in India was only 14 s., whereas in this country it was £28. Now, I apprehend that if you wish to estimate the comparative amount of pressure exerted upon the people of two countries by their respective systems of taxation, you must compare the amount of tax—not with the number of the population, but with the total earnings of the people, the total value of their industry and wealth. If, for example, it be true, that whilst in India the average total earnings of the people is only 28 s. or 30 s. a year, and the taxation is 14s.; and if, on the other hand, the average earnings or incomes of the people here is £150 or £200, whilst the taxation is £28, it is clear that the burden, or pressure borne is in a reverse proportion to that indicated in the figures of the noble Lord. Before passing from the subject of the Indian land revenue, I cannot help expressing serious doubts of the wisdom of the measure which has been recommended to the Government of India by the Government at home—I refer to the redemption of the land tax. This measure is confessedly applicable only to the provinces of Bengal where the permanent settlement prevails. But this is exactly the portion of India, where the land tax is at least burdensome to the people, and where, with least injury, it may be retained in its present amount as a permanent source of revenue to the State. The reasons assigned in favour of the measure are that the purchase money can be applied to the extinction of a corresponding amount of debt; whilst the effect of rent-free tenures will
  1490
  be to increase the loyalty of the people to the Government, since, if that Government were replaced by any other, it is hardly probable that such tenures would be respected. As regards the first consideration, I am afraid that, as is generally the case with private individuals, sums received in forestalment of the income of future years, and which ought to be treated as capital, will practically be treated as income—but at the end of the operation, which must necessarily be slow, yielding its returns in driblets—we shall find the debt not diminished by a single rupee, and a large population, not the least wealthy in India, contributing nothing to the necessities of the State. The inevitable result will be that though relieved from that particular impost, other imposts will be substituted in its stead; and thus the argument derived from the supposed political effects of the measure will fall to the ground. I am, therefore, disposed to think that whilst there is every reason to lower the land tax where it is excessive, and to spend the resources of new taxation in that most useful reform, it is unadvisable to sacrifice the land tax where it is moderate in amount, and may therefore without injury be retained.
  Reduction in the civil expenditure is another resource which I see must be dwelt upon at the present moment. It is, indeed, impossible to look over the salaries attached to various offices in India without seeing that some reduction might be effected. But, I am convinced that on the whole this cannot be regarded as a resource from which you can gain anything on the total expenditure of the Government. What you save in one direction, and probably far more, you will have to lay out in another. There is a Committee of the other House now sitting on colonization in India; and your Lordships will find, if you examine the evidence taken before it, that the one constant cry is "more European superintendence;" and as regards subordinate employments such large and larger salaries as may secure, at least, a higher class of Native. In every branch of the public service, the revenue, police, judicial—the same demand is repeated—the same necessity is felt. We may depend upon it that on the whole the expenses of civil Government will rather increase than diminish, and the hope of deriving from economy on this head, any assistance whatever towards meeting the existing deficit must be put entirely aside. We come, then, to the point from which we started, that a reduc-

  1491
  tion of the present enormous military expenditure is the one only resource which remains. But for this expenditure there is no ground for despondency. In the year which ended about the commencement of the mutiny, our income equalled our expenditure. There was a nominal deficit on the accounts of £179,000; but whilst there was, so far as I can see, no extraordinary item in the receipts, there was one very extraordinary item in the expenditure, viz., one half of the cost of the late Persian expedition which amounted to £205,000. Deducting this, there was in truth an actual surplus—and this, too, allowing for an expenditure on Public Works of £1,800,000. Yet, in that year, upwards of eleven millions was the military expenditure of the State; and if we cannot now hold India, after the disarmament of its people, the destruction of their forts, and the moral effect of our late triumph, for a sum even less than this—then our prospects are serious indeed. Since the beginning of the mutiny, a large increase of charge has arisen from the debt which has been incurred. That increased debt amounts already to about £27,000,000, and I fear we may count on another year's deficit, which will raise the amount to £37,000,000, with a permanent increase of charge for interest approaching to £2,000,000. I need hardly say that this renders it the more absolutely necessary to proceed without a moment's unnecessary delay in bringing the military expenditure within reasonable limits. Our present deficit is not to be wondered at when, by the statement of the Secretary of State for War, more than half the whole British army is quartered on the revenues of India, whilst the number of Native troops is actually larger than before the insurrection. In this state of things, I confess I heard, with some alarm, the language held by the noble Earl at the head of the Government to-night, which tallies with the language of General Peel in "another place," to the effect that the withdrawal of troops from India is to be considered not exclusively with reference to the condition and prospects of that country, but also with reference to the convenience of the Government at home. Lord Clyde, at the beginning of the year, when his operations in Oude had just been brought to a conclusion, appears to have intimated to the War Office that he could spare a certain number of regiments, and the noble Earl says that if more than this anticipated
  1492
  number should come home, it would put the Government to the inconvenience of a supplementary estimate for the year. It would thus appear that if later in the year Lord Clyde should find the country so quiet, the disarmament so complete, and altogether the prospects so secure, as to justify him in sparing a large number of troops, India would not be allowed to have the benefit of that reduction until the end of the year, thus throwing on the overburdened resources of that country, for perhaps a considerable time, a larger force than is required for its defence. Now, though I do not pretend to be a judge of the exact amount of inconvenience which a government might suffer from the necessity for a supplementary Estimate, there is one thing of which I am confident, and that is that such inconvenience, whatever it may be, is not to be compared with the evil of delaying for a single day to reduce, as far as the necessities of that country enable you to do so, the enormous military expenditure which is throwing its finances into present confusion, and threatens to leave them in a condition of permanent embarrassment. Connected with this subject, I must notice a report which has prevailed that the Government intend to send out to India twelve batteries of the Royal Artillery, contrary to the opinion of the Council at Home; and it has been added, contrary to the opinion of the Indian Minister. The last occasion on which I had the honour of addressing this House on the affairs of India, it was before that change in the form of Government which has since received the sanction of Parliament. I hear it already said, among the various expressions of dissatisfaction to which the present alarm gives rise, that that change has proved a failure, and that there must be a more complete reversal of the former system. I do not use this language, nor indeed do I hold this opinion. I think that to a great extent it is founded on a mistake as to the reasons which induced the late Government to propose, and the present Government to adopt the change referred to. That change was not made—I speak with confidence, at least as regards the late Government—because we believed that the Government of the East India Company had been a total failure, or that their policy had been such as to require complete reversal, but mainly because we thought that the change, whilst tending to promote improvement and reform, was required for giving additional

  1493
  strength to the Government of India. We thought that by bringing the Minister for India face to face with his Council, there would be, at least where both were agreed, such an identity of feeling and of interest as would produce a strong executive; and where they were not agreed, due provision was made for a record of the policy which was rejected as well as of that which was actually pursued. Too much stress, I think, was laid upon what was called the "independence" of the Council, because you meant only independence of position, and never intended them to possess any independence of authority. But I shall indeed think that the change has proved a failure, if it be true that the Minister for India, agreeing with his Council, shall be unable to enforce in the Cabinet and in Parliament the policy which they deem best for the interests of India. We have at least a right to know how far the military expenditure involved in the measures of Her Majesty's Government is, or is not, considered by them to be really required. We have a right to know how far notions of Imperial policy, which may be merely considerations of convenience to an existing Cabinet, are interfering with that Indian policy which is recommended by those specially responsible for Indian Administration. Might I venture to repeat that no considerations of ministerial convenience at home ought to be allowed to interfere with the one essential operation which can alone be effectual in restoring the credit of Indian finance. The language which is now held as to the ultimate responsibility of the Imperial Exchequer, and the conviction that, whether that language be literally true or not, it is perfectly true that embarrassment in India will result, and that soon, in serious embarrassment at home—is raising a just feeling of alarm in the public mind—partaking, as all popular alarm does, of the nature of irritation. You cannot go into the streets without hearing men say, "India is not worth keeping on such terms." This, no doubt, is merely the expression of impatience. We cannot abandon India—it is morally, it may almost be said to be physically, impossible. It would be difficult to say how much blood and treasure England would not be willing to expend rather than lose her empire in the East. We are all proud of that dominion, and justly proud of it. It is the great existing proof of the yet undecayed and undimi-
  1494
  nished energies of our Imperial race. But behind and above this there is a better and a higher feeling of the deep obligations under which we lie to the people of India. There is a conviction, and a just conviction, that if the present condition of its financial affairs is to continue, those obligations cannot be discharged. It is not merely that the present state of things interferes with this or that particular expenditure which would be more permanently useful—it is not merely that it leads us to grudge, for example, the comparatively trifling sums spent in the education of the people, and in affording them opportunities of improvement of which it has been clearly proved that they are most eager to avail themselves—it is not merely that in every direction it is interfering with every scheme of a just and wise benevolence; but it is that by those sure laws of political economy which regulate the wealth, and with the wealth, the happiness of nations, the cause of national progress is incompatible with an embarrassed Government and the innumerable evils which are inseparable from it.
  THE EARL OF ELLENBOROUGH: My Lords, I entirely agree with the noble Duke in deprecating the extension of any guarantee by England to loans raised in India for the service of that country—I do not think the time has yet arrived even for considering that general question. I deprecate it not so much on behalf of England as on behalf of India. I do not think that a general guarantee would lead to extravagance on the part of the officers employed in India; but it would give rise to a constant interference by Parliament with the Government of India, and to a reduction of establishments and of salaries which I am convinced would be utterly fatal to the good government of that country, and ultimately to its connection with England. On that ground I deprecate it as a general principle. But, my Lords, there is one point which I wish to bring under the consideration of the House, and of Her Majesty's Government, and which I think is well worthy their attention—namely, whether it might not be advisable for a particular purpose, and in an exceptional case, to extend that guarantee? Your Lordships are aware that the revenues of India are burdened with a permanent charge of £630,000 a year, payable to the proprietors of East India Stock. When the Bill was passed for the Government of India in 1833, a sum of £2,000,000 was set apart,

  1495
  which was to accumulate; and it was expected that, at the end of forty years, that accumulation would produce a sure of £12,000,000,—or an amount equal to the whole of the capital stock of the East India Company,—and enable the Government then to pay off the holders of that stock. The calculations then made seem to have been based on very erroneous data, or at least they have not been verified by experience; for instead of there being any probability of this sum being realized in 1873 for the purpose of paying off this £12,000,000 of stock, it appears, from the figures furnished the other day, that, supposing the average price of the funds to remain for the future as it has stood for the past, the amount required would not be realized before the year 1887. I would suggest, therefore, whether it would not be expedient for the Government of this country to guarantee the payment upon the East India Stock to the amount of £630,000 annually, having, of course a claim to that extent upon the revenues of India. A measure of this kind would at once set free the whole of the sum now accumulated under the head of the guarantee fund, namely, about £4,700,000, and would thereby immediately relieve the revenue of India from the necessity of having any loan this year, or relieve us from the necessity of raising any additional loan to that now under the consideration of this House. If at any future period it should be thought advisable on the part of the Government to pay off this stock, the operation could be effected with advantage to the public. In all probability, the interest upon the amount required to be raised to effect it would not exceed £350,000 a year, which, as compared with the present amount of £630,000 which the Government would continue to receive from the revenues of India, would yield a gain of £280,000 per annum. I agree also with the noble Duke in entertaining very great apprehension at the extension of the system of giving guarantees of interest at 5 per cent to public works in India. When I was for a short time in office last year, I was told that the sum already guaranteed in this manner amounted to £28,000,000. With a good deal of reluctance, and after much consideration, I consented to an additional guarantee to the extent of £2,000,000 to afford facilities for the making of a railroad of the greatest possible importance in connection with the communication be-
  1496
  tween Madras and the Island of Ceylon. But I certainly made up my mind I would not, under hardly any circumstances, go beyond that last guarantee. The sums now guaranteed amount to more than £40,000,000. The interest of these sums will be £2,000,000, and with that interest the revenues of India are charged. Your Lordships have had more opportunities than I have of investigating the position of the various railways established in England. You know, as I do, that, with one or two exceptions, they have not paid 5 per cent out of their earnings; and I think it contrary to all reason to suppose that, in the peculiar circumstances of India, her railways, however cheaply constructed, can produce any dividend at all approaching to that rate. Now, looking at all the facts of the case, and taking even a more favourable view of the prospects of railway property in India than I am disposed to think warranted, it appears to me that there is likely to be an ultimate deficit of at least half a million a-year upon those railways, which will have to be made up from the revenues of India. But that is not the whole of the loss. I apprehend that when money is expended upon railways, two or three years at least must elapse before they yield a return: whereas the guaranteed interest is payable at once; and consequently for the whole of that period the Indian exchequer will have to pay the shareholders 5 per cent. If then you consider that there are £40,000,000 to be expended, and assume that these years will expire before a profit upon the outlay is obtained, the loss to the finances of India will not be less than £6,000,000 previously to any of these lines being brought into working order. These, then, are matters really requiring the serious attention of the House. My noble Friend at the head of the Government had the goodness to-night to answer a question which I had previously put to him, and he has given a perfectly clear explanation of the manner of conducting the accounts between the Government of India and the several railway companies. But he did not appear to perceive the disadvantage of that arrangement. It may be gathered from one of the letters from India, and it was only when I saw it stated there that I became acquainted with the working of the system. I was always under the impression that all, or nearly all, the money was received in this country, and all the money paid in this country, the various companies transmitting what they required

  1497
  in the ordinary way, by means of commercial bills. My Lords, not a fortnight elapsed after we had intelligence of the commencement of this mutiny before I earnestly desired the Government to insist upon there being no more remittances forced from India to England. This request was assented to, and we have been believing till now that there have been no such remittances. But, from what my noble Friend has stated, it appears that in the next year there will practically be a remittance of £5,000,000 from that country: that is to say, India will be charged with payments on account of these railways, from which she receives nothing, to a sum equal to the whole amount which you are attempting to raise in this country for this year by means of a loan. All the financial difficulties of India now arise from the forced payment of the advances made by the railway companies. I see it is stated that £4,280,000 will be paid to that account before the 30th of April; the sum next year will be £5,000,000; making together £9,280,000 which is practically to be remitted to England. This money remains in the coffers of the Council of India, who use it for any of their own purposes. It is as much money remitted as if it came in the shape of bullion from India, or of hypothecated goods, or in commercial bills. This is entirely contrary to the promise given when the mutiny began, and now that daylight has broken in upon the practice, I trust it will be discontinued. If an account were called for of the remittances from India, in addition to the amount sent by bullion, Government bills, and the hypothecation of goods, the money sent for railways must be included, and would form a very serious item. I trust that the Government will put an end to this system, which causes a loss of 1¼ per cent on all the money that is raised for this purpose, and which, beyond this, causes extreme embarrassment by compelling the Indian Government to go into the market for money, when otherwise it would not have been necessary. On another point adverted to by the noble Duke, I also agree with him; namely, that the proportion of the Queen's troops serving in India, and in England ought to be governed by the exigencies of the service from time to time, and by nothing else. My Lords, I never like to see a course taken by the Government which is as ruinous in public as in private life, that of deciding great questions by little views. This Bill was
  1498
  brought into the House of Commons before we knew of the financial embarrassments in India that have since transpired. Circumstances may have rendered it difficult to calculate the extent of financial embarrassment in India until the present time; but I regret that this is not a Bill for enabling the Government to borrow a larger sum than is proposed. Time is of importance in finance as well as in war, and occasions and necessities of borrowing may occur, of which we should be able to avail ourselves at once. I therefore regret that the power of borrowing is not given to a greater extent, But this financial embarrassment does not come upon me by surprise. I took occasion eleven months ago to express in this House my apprehensions that, great as were the dangers of a protracted war in India, there were other dangers looming in the distance, of financial difficulties, arising out of that war, which dangers were the subject of greater apprehensions than the war itself. These apprehensions do not appear to have been entertained by the Government of India; and, I must say, I think that my noble Friend, the Secretary of State for India, deals extremely gently with this branch of Government Administration in India when he complains very slightly of something like want of foresight in those intrusted with financial affairs in India. My Lords, there is but one person intrusted with the superintending management of financial as well as other affairs, and that is the Governor General. The Governor General alone is responsible; because, by the Act of Parliament, if his Council differ from him in a matter of such importance, he has the power of overruling them. If he leaves the Presidency and goes up the country, he always takes with him the second financial officer of the Government, and he ought to be in weekly and even daily communication with his Chancellor of the Exchequer. His predecessors have been so, and if they had not been so the most serious dangers might have arisen. What I apprehend is this, that Lord Canning left all these affairs, as he thought, safely in the hands of the President of the Council, for it was only when he arrived at Calcutta on the 26th of January, that he appears to have perceived the extent of the difficulty. I deeply regret that the financial embarrassment was not sooner perceived by the Governor General, because I know the necessity that exists for his individually superintending the financial as well as

  1499
  every other department of the Indian Government. Let us place this question of finance on the true ground. We may take the year 1856–7 as our point of departure, because this year has been correctly stated as a year in which expenditure very nearly balanced the income. I believe the deficit in that year did not exceed £180,000. I moved for a return, which shows these results. Since that year, the interest added to the debt here is £457,664; the interest added in India is £527,257; the interest upon £12,000,000 which will have been raised here at 4¼ per cent, is £510,000; and the interest on £5,000,000, raised in India is £275,000. Thus, since the commencement of the mutiny, two years ago, the additional expenditure incurred by India, on account of the increased debt, is £1,769,921; to which there is to be added the £180,000 deficit in 1856–7, making altogether an expenditure exceeding revenue of little less than £2,000,000. My Lords, if this were all, I should not be under any great apprehensions, because I recollect perfectly well that when I came into office, thirty years ago—In September, 1828—the Government of India of that day were under great apprehensions relative to the finances; the Court of Directors were then looking forward to the prospect of the termination of their charter, and they were anxious to reduce their expenditure. When I was at the Board of Control, I had the inestimable advantage of the assistance of the late Duke of Wellington; and I am bound to say that the Court of Directors co-operated with me most zealously, most honestly, and most usefully in the reduction of the expenditure. In the two years and a quarter during which I held office, we either made absolute reductions that were completed, or brought into operation reductions which were not quite completed when we left office, or had determined upon further reductions which were almost immediately to be carried out, amounting to £1,864,000 per annum. And it must be remembered that this reduction was made with a much lower total of revenue and expenditure than now exists. Looking back, therefore, to what has been done, I should not be under any apprehensions if this were the only difficulty, But, my Lords, we must not forget that there is an enormous expenditure attending upon the winding up of a great war, and that it will be years before these arrears can be discharged. It must also be considered that whatever our disposition may be, it will
  1500
  be impossible for us at once to reduce to the level of the army of 1856–7, the vast force we now have in India. It will be necessary that we should hold a strong European garrison in India fur four or five years, until no one can indulge the hope of overthrowing our empire. My Lords, I can imagine no policy so injurious, so unwise, and so discreditable as that of at once relaxing our hold when with infinite difficulty we have subdued our enemies. Still, in order to equalize the revenue and expenditure, the Governor-General will be bound to consider the reduction of the army. I was not aware that the Native force amounted to so large a number as was stated by my noble Friend (the Earl of Derby); and I think he is not quite correct in mixing the military police with the troops in his statement. My noble Friend must remember that when a police of a military character is established the police of a civil character is removed. From the very day the military police was established by Mr. Montgomery the civil police was reduced. The number of that civil police many years ago, including those employed in the revenue department, amounted to as many as the whole Indian army; and no doubt since that time there has rather been an increase than a decrease. But when my noble Friend mentions 320,000 as the present number of the Indian army and the police, I should strike off 100,000 police as standing in the place of the civil force, but being of a more efficient character. I was the first who established the military police in India. When I left India it was done away with by the court of Directors; and what you are doing now is to re-establish that system. I know it may be urged now, as it was in my time, that although I reduced a much greater number of the civil force than I raised of the military police, the expense was greater. I gave the soldiers better pay, but the increase of expenditure was very small, while the country was much better served. Then, with regard to the European troops: we had at the beginning of this mutiny a European force of 38,000 effective men in India, and I cannot imagine a state of things during the next four or five years which would render it safe for us to leave India without a European force of at least double the amount we had there in 1856–7. There is very great expense attached to the employment of European troops in India; the cost of one European regiment equals

  1501
  that of three Native regiments. To reduce the expense of the Indian army to the scale on which it existed in 1856–7, it would be necessary to dismiss 114,000 men of the Native troops. I believe that may be done, but the reduction must not be carried into effect rashly, or at once. If the Government suddenly dismisses 114,000 men, or pays off any great proportion of them, every man will become a Pindaree. You will have to meet the difficulties for four or five years before the period will arrive when it will be safe to reduce this force. It is very advisable to provide for a portion of the increased expenditure by an increase of taxation; but we must remember, that though the Indian will submit to an old tax, he has very strong objections to a new one. At the close of a war it is absolutely necessary that the Government should not run the slightest risk of exciting the feelings of the people on the subject of taxation. But the objections to a new and direct tax do not apply to raising a larger revenue from the Customs duties. I trust also, there will be no difficulty in imposing the stamp duties on the three Presidency towns, which the Government, by a recent Act, is enabled to do. Hitherto, the wealthy inhabitants of the Presidency towns have had an exemption from the tax paid by the rest of the empire. I have heard a tax on tobacco suggested. I hope such a tax will not be imposed. I think it not advisable to impose any other tax which would have the effect of a poll-tax. But the inhabitants of Madras and Bombay, who are so much better off—I never could understand why—do not pay so high a tax on salt as the people of the other parts of India, and I think the Government may, with reason and justice, raise the salt-tax in those Presidencies to an equality with the amount paid in the other provinces. I think the Government might also fairly impose a tax on persons engaged in trade. At present that class, throughout India, is almost entirely exempted from taxation. How such a tax can be imposed without exciting discontent and be easily collected, I am not prepared to say; but means should be found of compelling these classes, who are the wealthiest in the country, to contribute to the revenue. If I had remained in India I had intended to propose to the Native Princes, an arrangement with regard to the payment of the customs duties, on the principle of the Zollverein of Germany; its object was to render the whole of India, from the ocean to the Himalayas, entirely
  1502
  free for the transport of goods by all persons. By facilitating the internal intercourse of 150,000,000 of people, I hoped I was laying the foundation of a degree of prosperity which India had never yet seen, and which ought to accompany the rule of an enlightened nation. It is said that "parsimony is a great revenue," but good government is a greater; and I am certain that a government established in India in conformity with the wishes of the people, and that alone, will enable you to reduce your military force to such an extent as to keep the expenditure within the revenue. I have here a letter from a very intelligent Native gentleman, now employed in a situation of great trust under the Government of India, who says, "No laws will ever succeed, whatever force they may bring to back them, if they will not suit the views, wishes, and customs of those who come under their operation. This is my full belief, confirmed by long and personal experience of my country and my countrymen; but I find the European public is as blind after the mutiny as it was before." He says, also, that "no single proof has yet been given that the Government will act in accordance with the spirit of the Proclamation." I would place before you as an example of the effect of good Government, the territory of Scinde. At the most critical period of the revolt there were in Scinde only 500 Europeans. There was a mutiny at each of the three principal stations; those mutinies were put down, but not one native of Scinde has been executed, and no mutineer has suffered without a regular trial. That is good government—the government established by Sir Charles, Napier, and continued by his two able successors. They have made that country the most loyal from one end of India to the other. They have governed that part of India without being compelled to come to this country for assistance. Where there is an unbroken succession of able Governors, all possessing the same principles of wise policy, much is effected for the people; but when the succession is, as is too often the case, broken in upon by the introduction of an incompetent man, the labours of the able are rendered vain. But, my Lords, whatever you may do for the general benefit of the people, be assured that the one thing above all others which it is absolutely necessary to do, in the first instance, is to give them the most absolute security with respect to their religion. Their apprehension upon

  1503
  that subject was the immediate cause of the war we have had in India. Nothing can exceed the fairness and justice of the policy expressed in Her Majesty's Proclamation, and if the Government will determine to carry that Proclamation into effect in all its spirit, and will compel those who serve under it to act in accordance with its principles, you may be assured that at no distant period you will be enabled to look with satisfaction and joy to the state of India, and not with a feeling of sorrow, of shame, and of remorse.
  THE EARL OF ALBEMARLEsaid, he wished to call their Lordships' attention to one or two points connected with the revenue of India, previous to the outbreak. Their Lordships would remember that the customs levied by us in India were not levied merely upon our own 130,000,000 of subjects, but also upon 70,000,000 other people, inasmuch as we had the whole of the seaboard. What, then, was the amount of the customs obtained from these 200,000,000 of people in the year preceding the rebellion? The paltry sum of £770,000. It had been stated that the Government intended to put a tax upon tobacco in India; but he was glad to find that so obnoxious a lax had been abandoned. The stamp duties, which it was proposed to increase, yielded for so great a country as India an inconsiderable sum, and the revenue from salt had actually declined, notwithstanding the great increase in the population. For the last fifty years there had been no increase in the revenue from land, or from any article of consumption upon which a tax was imposed and to which the Native subjects of India were contributories. His noble Friend the noble Duke who spoke early in this debate, (the Duke of Argyll) would have to admit, upon further examination, that he (the Earl of Albemarle) had not, as the noble Duke imagined, over-estimated the grinding taxation to which the Natives of India had been subjected under our dominion. He would mention one fact which, he thought, demonstrated the extreme misery of the Indian population under the present system of taxation. The Secretary for India had stated, in "another place," that our revenues had increased with our territorial possessions. In one sense, that was true; for, in cases where the Government had seized the revenues of native Powers, the general revenue had, as a necessary consequence, increased—but with these exceptions, for the last fifty years there had
  1504
  been no increase in the land revenues, or upon any article of Indian consumption to which the Native subjects were contributors. In the Presidency of Madras there had been an actual decrease. About fifty years ago the land revenue in the Presidency of Madras amounted to £3,500,000 the population being 16,000,000. The population was now 23,000,000, and if the land-tax had increased in the same proportion it would now be £5,000,000, whereas it had remained stationary. What, then, must be the wretchedness of that population of 23,000,000, which had to subsist upon the same produce of the soil as fed the 16,000,000 of fifty years ago? Expectations had been held out that there would be an increase in the laud revenue of India; but how could the Government expect any increase of revenue from a people who were already taxed at the rate of 18 s. in the pound? One of the present Council of India had given evidence before two Parliamentary Committees, and had made a statement to the effect that when the rent of land was taken the parties paying that rent were not taxed at all. What would that House of landlords which he was addressing think if 18 s. out of every pound of rent received by them were taken from them by Government collectors? Would they think, if that deduction were made from their incomes, they were not at all taxed? Mr. M'Culloch, in his well-known work, described rent as a compensation for the expense of farm buildings, drains, roads, etc., but that rent, properly speaking, could only be considered in the light of compensation for the latter. Rent might be a fair subject of taxation; but how, he asked, could they separate the rent due to the landlord from the interest on the capital laid out in the improvements of the land? Rent had always existed in Hindostan, where there had been land in cultivation hundreds of years, but not in Pegu or Arracan and other parts of the country. When, therefore, the Government laid a heavy tax in Pegu and Arracan on such products as rice, they imposed a capitation tax of the most odious description. With regard to customs' duties, they could only be productive when masses were in such a prosperous condition as to be contributors. In England they raised large amounts, but he was most distrustful of the customs' duty which it was proposed to levy upon the greatly taxed people of India. Instead of paltering with an excise and stamp tax which had proved unpro-

  1505
  ductive, and instead of the very questionable succession duty, he suggested that an export duty should he levied upon the staple commodities of India—upon the rice of Pegu and Arracan for example, upon indigo, oil seeds, and other Native products. This advantage would arise from an export duty—that it would be paid by the wealthy foreigner instead of by the rack-rented and hard-pressed people of India. It was remarkable that the only elastic tax in India was one as to which no merit could be claimed by the Government inasmuch as all they did was to impose a duty upon it before it went into another country. The duty on opium yielded a revenue of £3,500,000, one-fifth of the whole net revenue of India, and it was rather a serious consideration to reflect that this one tax had been the means of preventing the Indian exchequer from becoming bankrupt, leaving us the alternative, either of giving up the country or of coming to the Imperial Exchequer. Here he would throw out for the consideration of the Government the propriety of abandoning the existing monopoly with regard to opium. At the present moment the Chinese were themselves cultivating this article to a very great extent. Opium was grown in the remote provinces of China, but it was of very inferior quality; at all events, the Chinese liked our opium better than their own. Now, if the monopoly were abolished, we should be able to enter into a fair competition with the producers in China, which under the present system was out of the question. It was unnecessary for him to dwell on the immorality of the opium trade, for he had spoken on this subject a few evenings ago; and by the late treaty, too, the trade had become perfectly legal. Passing from this subject, then, be would express his regret that the Government had announced their intention not to deal with any of those vicious systems of land revenue which he believed to be the main cause of all our embarrassments. He had heard it assigned with surprise as a reason for taking that course that the Natives of India were so wedded to their present system of land tenure that it would not be expedient to interfere with it. He must, however, remind their Lordships that neither the zemindaree system, which now prevailed in Bengal, nor the ryotwarree, which obtained in Madras, nor the village system, which existed in the North-Western Provinces was fifty years old; these several systems were, in fact,
  1506
  English in their origin, and he could not therefore see why they should not be meddled with. For his own part, he felt confident that the principle on which we at present acted in India, of allowing the State to be regarded as the chief landlord, and granting no leases in perpetuity operated as a virtual exclusion of the European from that country, and thus deprived it of an advantage in which, in his opinion, was to be found the best, if not the only means of regenerating its people, and making them prosperous and contented.
  THE EARL OF DONOUGHMORE,said that as regarded the observations which had fallen from his noble Friend (the Earl of Ellenborough) in reference to remittances alleged to be made to India to this country in connection with railways, said, that it was a mistake to suppose that the money in question was paid by the Indian Government out of Indian resources. The whole thing was, after all, a mere matter of account. Out of every million sterling which was subscribed for the construction of railways in India about £440,000 was spent for the necessary works performed in this country, the remaining £560,000 being applied, in the first place, to the payment of the interest guaranteed to the shareholders; any sum which happened to be left being devoted to the purpose of defraying the capital expenses of the Government of India. Now, if that sum of £560,000 which remained after the payment of the necessary expenses were remitted to India, an equal amount should be remitted thence to this country for the purpose of defraying the expenses of the Home Government, &c.; so that, in point of fact, the £560,000 which were retained in this country merely replaced the remittances which would otherwise have to be made from India for the expenses of the Home Government—an arrangement which he could not help regarding as extremely judicious.
  LORD MONTEAGLEsaid, the House had a right to complain of the complicated and unintelligible manner in which the Indian accounts were presented to them. The question involved in this Bill was one of great magnitude. He could give the authority of Lord Hardinge for saying that the real danger of India was not so much in the people we had to govern as in the finances of India. It was a mistake to suppose that the difficulties of Indian finance had originated with the mutiny. That they had been greatly enhanced by

  1507
  the mutiny he admitted; but that they had been occasioned by it he utterly denied. For a long period antecedent to that event the revenue had fallen short of the expenditure. In the twenty-two preceding years there had been £20,000,000 of deficiency and only £5,000,000 of supply, leaving a net deficiency of £15,000,000; so that the remark of the Chancellor of the Exchequer that the state of Indian finance was a "state of chronic deficiency" was perfectly just. To that chronic deficiency it was most difficult to apply a remedy. He did not see much prospect under existing-circumstances of greatly reducing the expenditure in India, and the noble Earl had not held out the prospect of obtaining any large increase of revenue from additional taxation. It appeared, however, that there was some hope of obtaining assistance through the medium of the support of English credit; and he might remind the House that in 1810 and 1812 the wants of India were recited in the preambles of certain Acts as a justification for the advances which in those years were made to India. He believed that the revenues of India were fully adequate to meet the interest on the debt; but what in the meantime, without assistance from England, was to become of our army, and what of our civil service in India? At the present moment the civil servants were only receiving subsistence money, or "board wages" as it might be termed, and that short payment was to be continued for a period of three months. Would they allow the army to remain unpaid? But if the Indian resources should be insufficient to pay for the Indian service, there was no choice but for this country to provide the funds or to abandon India. He wished to know when the Report of the Commission upon the Indian army would be laid upon the table.
  THE EARL OF DERBYsaid, the Report had been received; but the Government did not wish to lay it upon the table un-accompanied by the evidence, nor before the Government had had time to decide the course they would adopt in consequence.
  Motion agreed to.
  Bill read 2a accordingly.
  Committee negatived.
  Standing orders Nos. 37 and 38 considered (according to Order), and dispensed with; and Bill read 3a and passed.
  House adjourned at half-past Eight o'clock, till To-morrow, half-past Ten o'clock.