1848. From that it appeared that there was an excess of expenditure over income during the last year of 2,956,6831.; but in that sum was to be included 1,525,0007. granted for the relief of distress in Ireland, and 450,000l. the remaining China money, which was stopped at the Cape of Good Hope on its road to England and applied to the purposes of the Caffre war. The real excess would be 981,6837.

at

Lord John recited the estimate made by the Chancellor of the Exchequer for the past year, and stated the produce, of the revenue upon an estimate formed for the remainder of the year to the 5th of April, 1848. The Customs, estimated to produce 20,000,000l., had only produced 19,774,000l.; the Excise, estimated at 13,700,000l., had produced 13,340,000l.; Stamps, estimated at 7,500,000l., produced 7,150,000l.; Taxes, estimated at 4,270,000l., produced 4,340,000l.; Property Tax. estimated 5,300,000l., produced 5,450,000l.; Post Office, estimated at 845,000l., produced 923,000l.; Crown-lands, estimated at 120,000l., produced 60,000l.; Miscellaneous, estimated at 330,000l., produced 325,000l.; the whole estimate, calculated at 52,065,000l., had produced 51,362,0601. Referring to some of the more important items, Lord John Russell stated that there had been an increase in the produce of duties on molasses, sugar, rum, and tobacco; but, on the other hand, there had been a decrease in the revenue derived from the duties on corn, timber, wine, malt, and spirits.

The estimated expenditure for the year ending on the 5th of April, 1848, was 51,576,000l.; but the excess on the Navy Estimates had been 185,000l., on the interest on

the Loan 280,0007., and interest on Exchequer Bills 142,000l. The expenditure actually voted for the year 1847-8, including several sums which were not contained in the budget, was 52,315,7091.; the estimated receipts to which he had alluded were 51,362,060l., leaving a deficiency of 953,6491.

13,000,000

500,000

7,200,000

4,340,000

5,200,000

900,000

Lord John stated the estimate of the revenue for the year commencing on the 5th of April, 1848, and ending on the 5th April, 1849:Customs £19,750,000 Excise Stage-coaches Stamps Taxes Income Tax Post Office . Crown lands 60,000 Miscellaneous 300,000 making a total amount of 51,250,000l. Taking the expendi ture voted at 52,315,7091., and the estimated receipt of revenue for the next year at 51,250,000l., there would therefore be a deficiency of 1,065,7097., that is, on the supposition that the expenditure would be the same in 1848-9 as in 1847-8. But there was at present a sum of 245,500l. due for the expenditure of the Navy for the year ending in April, 1847; there was also a sum of 1,100,000l., to be paid for the expenses of the Caffre war; and, taking these two sums, together with the deficiency which he had already mentioned, there would be a deficiency of 2,141,2097.

Now he had been desirous to lay this condition of the finances at an early period before the House, in order that it might take it into the fullest consideration, and might resolve upon that course which was most fitting to the interests and the credit of the nation. Various courses were open to the

House; and all he had to do was to state the course which appeared to the Government to be best, leaving it to be decided by the deliberate judgment of the House whether what Ministers proposed was most fitting, or whether any other course would be more conducive to the welfare of the country. It was obvious that the deficiency must be met either by taxation or by great reductions in the army and navy. Extreme opinions had been expressed out of doors on the defences of the country. On the one hand, it had been stated that Foreign Powers, especially France, were making great preparations; that there might be war, and possibly invasion; and that our preparations were inadequate to meet this danger. On the other hand, it was said that there was every prospect of peace; that the inclinations of Foreign Powers were friendly; that invasion was most improbable; and that our naval and military estimates were extravagantly high. In stating the views of the Government on these discordant opinions, he wished to guard himself against the supposition that there was any thing in the present state of our relations with France which threat ened the rupture of peace.

Lord John Russell here avowed, in the most emphatic terms, his anxiety for a cordial, intimate, and lasting alliance with the French nation. This portion of his speech was warmly cheered by the House.

He wished to guard himself upon another point. A foreign writer, animated by the most kindly feelings towards England, had described the Duke of Wellington as having made a pamphleteering reply to the Prince de Joinville. No thing could be more foreign to the intentions of the Duke of Wellington.

Nothing had given that illustrious individual greater pain than the publication of sentiments which he had confidentially expressed to a brother officer. The Duke of Wellington, as was his duty, had communicated to the Government of the country that which he conceived to be a deficiency in our defences; but, in so doing, nothing was further from his wish than to make any public appeal, or in any way to inflame or exasperate relations between England and other countries. No one could dispute, however, continued Lord John Russell, that this country might be involved in war. Since the peace of 1815, disputes between this country, the United States, Russia, and France, had been allayed only by great forbearance on both sides. However tranquil, therefore, the atmosphere might be at present, there might be at any time an unforeseen storm; and he was the more convinced of that circumstance when he recollected that Mr. Pitt in 1792 anticipated a long continuance of peace. It must be borne in mind, that in the last three hundred years the elements on various occasions had been our friends, and expeditions against us, prepared with the most zealous care, had been defeated only by adverse winds. The science and skill of late years had enabled seamen to traverse the sea against winds and tides; and that circumstance might induce hostile powers to consider this country more open to invasion. Under a king who was a sincere lover of peace, since 1833, the active preparations and increase of the naval force of France had been very extensive. Lord John read returns to the French Chambers; the number of seamen had increased from 18,000 to 29,000; vessels at

sea, from 153 to 216; steamers, from 66 to 120; the expenditure from 2,280,000l. to 3,902,000l.; the whole sum for the French army and navy in 1849 was 23,817,000l. Several of the French steamers are of such a size that they each carry from 1000 to 1500 men.

Preparations had not been wanting on our side. Since 1835, we had increased the number of our seamen from 26,000 to 43,000 men; of our soldiers, from 100,991 to 138,769; and of our ordnance corps from 8252 to 14,294; making an increase of 60,321 upon our military force in the whole. Besides, the late Government had organized 15,000 soldiers of the line as pensioners. The present Government had formed a force of 9800 men out of the workmen in the dockyards, who, as infantry and artillery, were in possession of, and capable of working, 1080 guns. A plan had also been carried into effect for drilling and organizing the Coast Guard, and for keeping a supplemental force ready in case the services of the Coast Guard should be wanted elsewhere; which would supply a force of 6000 men. Lord John showed that the charge of the Army, Navy, and Ordnance, for the defence of the country, had increased from 11,730,0737. in 1835 to 17,340,0967. in 1847. He then called the attention of the House to our condition as regarded the Navy. He proposed to make an increase of 164,000l. upon the Naval Estimates; but of that sum only 70,000l. would go to the real increase of our naval expenditure; 94,000l. being for expenditure not naval. He read a letter of the First Lord of the Admiralty to himself, describing in detail the various ships which he intended to keep in commission, and in different

degrees of preparation, during the present year. It was proposed to have a reserve of steamers at Portsmouth, Plymouth, Cork, and Sheerness. To the Marines would be added 1500 men; 1500 had been added last year. With regard to the defences of our ports and dockyards, their deficiencies had attracted the attention of the late Government, which had given orders for their examination. That subject had been too long neg lected; but, since the year 1844, 262,000l. had been expended on the works for the defence of Portsmouth, Plymouth, and Devonport, Pembroke, Sheerness, and the Thames; and they were now, in the opinion of the Duke of Wellington, and the Master of the Ordnance, in a satisfactory state. Returning to the Army, he said, that although Ministers did not propose to increase its force by a single man, yet the number of soldiers in the United Kingdom would be increased by the return this year of 5000 men, if not more, from India; so that in the course of the summer he expected that we should have a force of 60,000 men in the British islands. As compared with the year 1835, this would be an increase of 20,000 men. The increase on the estimate for the Army was 43,000l. only. Government proposed to make a much larger increase in the Ordnance Estimates. It was obvious that, while we could make a rapid increase in our infantry, we could not make an increase of our artillery in less than eighteen months or two years. It was therefore proposed to increase the grant for the Ordnance by a sum of 245,000l. The whole increase on the Military, Naval, and Ordnance Estimates would be 358,000l.

There was another species of force, respecting which a measure would be laid before the House in the course of the present session. In considering the question of national defence, it was necessary to take into calculation the chance, however remote, of an enemy's landing on our shores; and in that case our force of 60,000 men would not altogether suffice to garrison the dockyards and other points of defence, and to supply troops for the field. In former times the country looked for defence to what was the favourite force of one of the greatest men the country ever produced, Lord Chatham: he meant the militia. There were, however, difficulties on that subject now, which did not formerly exist. If you were to allow men to serve by substitute, it was probable, from the migratory habits of our labouring population, that the substitute would not be forthcoming when he was wanted: and, if you were to refuse permission to serve by substitute, you would place parties under military service who had hitherto been exempt from it. He should propose a measure to meet those difficulties. If it be practicable, he believed it to be right to have a portion of our people trained to the use of arms, and capable, on the breaking out of hostilities, of being marched to any point at which their services might be required. But, if the House should come to the conclusion that a Militia force was not desirable, then it must consider, next year, whether it would not be expedient to make an addition to the regular army of the country. He proposed, for the present, to take a grant of 150,000l. to lay the foundation of this Militia force.

Now, it would be idle and presumptuous to say that the country would at once return to a state of prosperity; yet they might look. forward to an improved condition of the commerce and manufactures. They might expect an improvement of income, and a diminution of the expenditure occasioned by the Caffre war, which Sir Harry Smith said was now at an end. Lord John, therefore, thought that only a temporary increase of taxation would be required. He proposed that they should continue the Income Tax, which would expire in April next, for five years, and increase its amount from 7d. to 18. in the pound, or from 3 to 5 per cent. for the next two years. (Loud ironical cheers.) Considering the distress of Ireland, and the efforts which its landlords and tenants were making to relieve it

though in justice we had a right to impose this tax upon Ireland as well as upon England-(Loud cheers)-admitting fully the justice of that course, Ministers considered

that this was not the moment. (Exclamations of dissent mingled with cheers from different parts of the House.) He begged honour able gentlemen to consider, that if they checked the exertions in Ireland, they would check also the returning prosperity of the United Kingdom. He proposed the Property Tax exactly on the same principles as those on which it was proposed by Mr. Pitt, on which it was increased by Lords Grenville and Lansdowne, and on which it was imposed and defended in 1842 by Sir Robert Peel. (Laughter.)

He drew attention to the large reduction of duties which had taken place of late years on articles of consumption required by great bodies of the people. There had been taken off taxes on salt, candles, coals, leather, beer and cider, glass, sugar, butter and cheese, grain and meal, amounting to 10,543,6727. in late years; and the whole amount of annual taxes on articles of taxation taken off since the peace amounted to 39,705,3411. The result of his scheme would be this: the expenditure being 54,596,500l., and the income 51,250,000l., he proposed to make up the deficiency by the increase of the Income Tax, which he estimated to produce 3,500,000l.; making a total income of 54,750,000l. He also proposed to remit the highly injurious duties on copper ore, which were imposed in 1842, and produced 41,000l. When those duties were remitted, he should have a surplus of income over expenditure, amounting to 113,000. In another year, he trusted that the surplus would be largely increased by the cessation of the expense occasioned by the Caffre war; and

it might then be applied to the reduction of those taxes which pressed most heavily on the elastic springs of industry. It was not in his power at present to propose any such reduction. He had taken that which some considered the odious path of duty; and he should conclude by expressing his conviction, that, by adopting his suggestions, they would restore the commercial credit of the country, preserve the public faith unimpaired, and would run no danger of seeing the empire insulted or injured by any power whatever.

Lord John Russell then moved two Resolutions, embodying his plan for augmenting the Income Tax. A long and desultory debate ensued. Almost all the speakers expressed dismay and reprobation. Mr. Hume asked whether they were all mad, that in a time of increasing distress among manufacturers they should propose increased taxation? He should undoubtedly propose reduction in our establishments to meet the excess of expenditure. Mr. Bankes, the Marquis of Granby, Mr. G. R. Robinson, and Mr. Newdegate saw in the disastrous state of the finances the result of free trade. Mr. Osborne believed that, if there had been a regularly organized Opposition, such a financial statement would never have been made

it would have been the deathwarrant of any Administration; Sir Robert Peel was now avenged for Lord John Russell's speeches against his Income Tax. Mr. Osborne thought they might have increased efficiency of national forces with their present expenditure. Sir Benjamin Hall hoped that the Income Tax would at least be more justly distributed. Colonel Sibthorp was surprised at no amount