obviously lead to a more general know-mitted themselves to this question, and he hoped they would not shrink from their duty. ledge and agreement respecting sound principles than now existed before the time arrived for settling the future question of the Bank of England Charter. Mr. Hutton had hitherto supported the bill, as he was opposed to allowing Jointstock Banks the power of issuing small notes. But as he had no hopes now of getting his views discussed, he must oppose the motion for going into committee on the bill. Mr. John O'Connell moved that the debate be adjourned till four o'clock. Mr. O'Connell hoped the House would adjourn. It was impossible to do justice to the subject at that hour. Until the year 1823 or 1824, it was proper to observe that all Ireland was subject to the bank monopoly, when the sixty-five mile line was struck as a compromise. He did not think that shortening the duration of the bill-that limiting the time-would answer any good purpose. It was a mere mockery to think of effecting a compromise by merely shortening the time. He understood that they had something in the shape of an offer of compromise from the Chancellor of the Exchequer, if they would consent to sacrifice Drogheda. ['No, no!'] What then did the right hon. Gentleman mean? He heard him say he could not include Drogheda; and it should beknown that the Government were supporting the Bank monopoly against the people of Drogheda. Sir R. Inglis had been accustomed, from the force of early education and habits, always to support the Government of the Crown for the time being, and it gave him great pain when he found himself obliged to act differently. He had frequently supported her Majesty's Government during the present Session, but it would be impossible to carry on the public business if hon. Gentlemen should continue the course of opposition which they had commenced with regard to this measure. One day they had a speech hot, the next day it was served cold, the day following it was hashed. They had the same arguments, not merely day after day, but in the morning sittings and evening sittings, in committee and in the House, in every variety of form. He thought the number of Members present quite sufficient to discharge the duties which they were called upon to do, and he trusted the House would not be forced to a division again. The Ministry had com Mr. Gisborne said, the Chancellor of the Exchequer had shown a disposition to meet the opposition in point of time, but that was not satisfactory to the hon. and learned Gentleman. Then there was the question of distance, on which he thought the right hon. Gentleman was not inaccessible to compromise. The whole point, then, that remained, was as to the town of Drogheda; and the Chancellor of the Exchequer did not object to its having a free banking, but free issue. The right hon. Gentleman must be aware that the one was completely involved in the other. Sir W. Somerville: The renewal of the charter for four years would be quite sufficient to destroy the prosperity of Drogheda. The Branch of the Bank of Ireland there was quite inadequate to supply the demands of the merchants, and the consequence was, that they were obliged to apply to other places for their discounts to Liverpool, and even Scotland. Mr. Kemble said, if there was any probability of a compromise, the House had better adjourn till four o'clock, and not divide at all. The Chancellor of the Exchequer said, two questions had been put to him-one as to circle, and the other as to time. Now, as to the extent of the circle, he felt that he could not maintain his exclusive principle of metropolitan issue if a competing bank was allowed in Drogheda. He was then charged with an intention to do Drogheda some particular injury; whereas, in fact, he refused to make any alteration as to Drogheda, lest it should be imagined that there had been a desire to do the town a particular injury. With respect to time, he had before stated, that he wished to make the arrangement with the Bank of Ireland contemporaneous with the arrangement with the Bank of England, that is, four years certain, subject to any further prolongation up to ten years more, unless Parliament interfered to prevent it. He had stated also, that it had been admitted by the right hon. Baronet, the Member for Tamworth, that, previous to the year 1844, it was necessary that the whole banking question should be maturely con. sidered; and that it was necessary that this consideration should be given two Sessions at least before that period. He therefore, thought it was a fair question | Price, Sir R. for consideration, whether the absolute renewal might not be made for two years, and that the period should be employed in investigation. He was so confident as to the correctness of this principle, that he would abide by any decision decis that men of literary and scientific acquirements might come to. Still he would not surrender the proposition he had made without the consent of the Bank of Ireland. Mr. Callaghan had expected that the Chancellor of the Exchequer would have been able to convince him that he might support the measure; but in that expectation he had been disappointed. The right hon. Gentleman had utterly failed to show any reason why the bill should have been forced on at this period of the Session. If the bill had any principle, it was the principle of exclusiveness, which ought not to be supported by a liberal Govern Pryme, G. Smith, B. Steuart, R. Surrey, Earl of Thomson, rt.hon.C. P Vere, Sir C. В. Wood, C. TELLERS. Parker, J. Stanley, E. J. Question again put, that the Order of the Day be read. Mr. O'Connell moved, that the debate be adjourned till five o'clock. The House again divided on the ques tion of adjournment.-Ayes 20; Noes 56: Majority 36.* Question again put. Mr. O'Connell moved that the debate be adjourned till to-morrow. He frankly admitted his object was delay. "Sufficient unto the day was the evil thereof," and he wished to finish the evil for to day. After some discussion, The Chancellor of the Exchequer intimated his readiness to agree to the amendment, seeing that, if he did not, the time would be occupied by divisions till the period when it was originally meant to adjourn (viz. three o'clock). Sir C. Douglas said he should like to know how the Government intended to carry out this bill, if the hon. and learned Gentleman persisted in his opposition? The Chancellor of the Exchequer said, that point would, perhaps, be better discussed to-morrow. Sir F. Freemantle said, the right hon. Gentleman had not shown the earnestness which he anticipated, when he saw him come down attended by such a number of his colleagues. He thought the course now taken almost tantamount to the abandonment of the bill. The The Chancellor of the Exchequer thought that no one could accuse him of want of earnestness in fighting this measure. ground which he had taken was perfectly satisfactory to himself; and as there was a measure of great importance to be brought forward to-night, he would not wish to mix it up with an impending debate, when it could not be discussed as it ought to be. * The names on the second division, with the exception of Mr. Gisborne and Mr. C. Lushington, absent from the Ayes, and Sir G. Grey added to the Noes, were the same as those on the first. Further consideration of the question my best to make it intelligible. But be adjourned to the following day. DUKE OF MARLBOROUGH'S PENSION.] The Chancellor of the Exchequer moved the second reading of the Duke of Marlborough's Pension Bill. Mr. Hume must continue to object to the bill, and moved that it be read a second time this day three months. Captain Pechell thought the bill necessary and just, and said, he should give the Chancellor of the Exchequer his support through all its stages. The Chancellor of the Exchequer defended the bill. The matter having been referred to a Select Committee, composed of Gentlemen on both sides of the House, not one of whom were by office connected with the Government; and that committee having unanimously assented to the provisions of the bill, he trusted the House would see no difficulty in agreeing to the second reading. Sir R. Inglis supported the second reading. He believed if a proposition had been made to pay a sum of 5,000l. per annum to the Dukes of Marlborough for ever, it would meet with no opposition in that House. The three branches of the Legislature having vied with each other in conferring honours and favours on the Duke of Marlborough, and an error having crept into the bill by which the amount of income was diminished, when the understanding was, that it should be free from all deduction, he hoped would be given to the bill. no fore I go into the question which forms the immediate subject matter of the resolution I have to propose, I wish to explain both to the House and to the public the exact condition on which I propose that the Exchequer bills market should stand, if this vote should be carried into effect, and also the condition in which-if the subject, which has been already too much, rather than too little discussed, namely, the Bank of Ireland charter, should be passed - would place Exchequer paper. The comparison which I shall institute with former times will not apply to a very remote period. If I were to explain to the House the immense advance of the unfunded debt from the commencement of the war to the return of peace, it would afford no practical result. It is matter of astonishment, when, looking back to that period, that this country should have been able to sustain the enormous amount of unfunded debt in the Exchequer market. But it was not sustained without great inconvenience at various periods. The comparison I propose to institute is between the year 1836 and the present year. In the year 1836, the amount of Exchequer bills constituting the unfunded debt, outstanding on the 5th of April of that year, was 28,504,850l.; in the year1837, the amount was 25,394,450l.; in the year 1838, the amount was 24,043,850l., and in the present year (1839), the amount outstanding on the 5th of April was 24,025,650/. [Mr. Hume: Does that include Exchequer bills for pubFor supplies exclusively. lic works?] opposition Mr. Harcourt considered the measure to be called for, and he hoped, therefore, that it would meet with the sanction of the House. Mr. Hume admitted, that the feeling of the House was against him, and therefore would not divide. Bill read a second time. FUNDING OF EXCHEQUER BILLS.] The House in Committee, to take into consideration, a resolution for funding 4,000,000l. of Exchequer Bills. The Chancellor of the Exchequer: I am quite aware that the subject I am about to introduce to the notice of the Committee is one of very great importance, but it is one also which it may not be very practicable to present to the House in a clear and dis tinct form. At the same time, I shall do The comparison then stands thus; that in the year 1836, the outstanding Exchequer bills for supplies alone was 28,504,8501., whereas in the present year the amount is 24,025,650l., showing a reduction in that class of securities of 4,479,200l. With respect to other classes of Exchequer bills, the reductions have been these. For advances for public works in 1836, the amount was 328,650l., for the same purpose in 1839, the amount is 195,850l, making a diminution of 122,800l. The amount of bills issued for the relief of the West-Indies in 1836 was 156,850l., for advances this year 8,000l., making a dimi. nution of 148,850l. On account of Irish tithes I propose to have funded 900,000l. Exchequer bills, and the resolution which I am now about to propose, and which I trust the House will do me the favour of accepting, will dispose of four millions more. So that, if this operation should be Exchequer Bills. completed, the comparison between the -it might have materially influenced the years 1836 and 1839, will present a reduc-credit of the country. I did not therefore, tion in favour of the latter year, to the fol- think it just, in respect to those who might lowing amount : be called upon in the way of contractors, to £4,479,200 require them to enter into any engagements 122,800 in reference to the funding of Exchequer 148,850 bills, until it was known that the Postage 900,000 Bill would be passed into a law. When it 4,000,000 was very certain that that measure would dinary course of a fixed price on the respon-period the Chancellor of the Exchequer £9,650,850 If I may be allowed, without irregularity, to allude to what has passed in another place, a very great authority has called the attention of the House of Lords and of the public to the expediency of reducing a portion of the unfunded debt. In this House, also, the hon. Member for Kilkenny, more than a month ago, expressed a hope that the present Session would not be allowed to close without reducing the unfunded debt. Undoubtedly, I am quite prepared to have the question put to me-" If this should be done, why have you not earlier made your proposition?" I will tell the House why. Because I did not think it just or expedient to make the proposition at an earlier period. The House is aware, that upon closing the supplies of this year, it became necessary to provide, in consequence of the extra Canadian expenditure, a vote for 25 millions of Exchequer bills, in the place of 24 millions, which was the amount for the last year. This might not have been required to be increased during the Session, nor hereafter, but if I had made a proposition for funding any portion of the unfunded debt, keeping the parties interested in ignorance of the possibility of further advances beyond the one million under this head of public securities, those individuals would have had a right to complain of their being called upon to enter into an engagement with the public without a full knowledge of all the facts affecting their interests. There is another matter which I think quite essential to be noted, for the purpose of fair dealing. I have had the honour of passing through the House in the present year a bill of no common importance-a measure important in itself, and beneficial as I hope it may prove in its consequences in many respects, but a measure also, as I stated when I brought it forward, involving very serious considerations with regard to the revenue of this country. I mean the bill for reducing the rate of postage. That bill affected so large an amount of the public revenue that in the judgment of some-though not in mine become a law, I then made a communication to the gentlemen of the money market in the city. That communication was addressed to them on the 10th of August instant, and the interval of time for making tenders (which was by some considered too short) was limited to Friday, the 16th instant. Before I state the particulars of what has occurred between the Government and the capitalists with whom we have entered into communication, it is necessary I should explain distinctly to the House the former mode of proceeding in respect to loans, and the course which I have now adopted, pointing out how far that course differs from the practice of my predecessors. I shall then endeavour to state the grounds of justification on my part for having taken a course different from the accustomed one on former occasions, leaving it to the House to determine whether I have acted rightly or wrongly in the adoption of it. The ordinary mode of funding Exchequer bills, is, by the minister for the time being, fixing arbitrarily upon a price which he believes just, as between the public and the contractor, and then communicating his terms to the Bank of England, and the gentlemen of the Stock Exchange, who either accept his price and enter into a contract for the loan, or altogether reject it. Now, in these instances, the whole responsibility rests with the Minister in fixing the price. It is fixed purely upon arbitrary grounds. As a matter of reason or opinion it may be suggested that the price fixed is a just one; but upon that point individuals may differ. There can, however, be no test equivalent to that which is found in free and open competition, where the clashing of different interests makes it perfectly certain that the public object has been obtained, and that Exchequer bills have been funded at the cheapest rate. Now, observe the danger to which the funding of Exchequer bills is exposed by the more ordinary course, as compared with the principle which I have adopted. The principle I have adopted is this, the loan being a loan for four millions, the Government invited the capitalists to a most unreserved competition. It was stated, that a loan limited to 500,000l. would be received; therefore, there was the utmost competition created that the public convenience could require. As long as it was a matter of contract, it was absolutely necessary to fix a limit to the amount to be tendered for. It was impossible to enter into an arrangement with the owner of every 500l. Exchequer bills that might be presented. However, it was perfectly open to any person to enter into a contract for the whole four millions. I wish to contrast the results, a priori, of taking the one course; namely, the more or what was that result? Why, it was stated in Parliament on that occasion as a fact, that although the loan was only for three millions, yet individuals actually came forward with tenders who represented eighteen millions of Exchequer-bills. Is not that in itself pretty good evidence that my theoretical argument is correct, and that the price fixed by the Government was disproportionately high? It was stated to amount to a bonus of 21. per hundred. I think both the fact and the reasoning equally prove, that that operation was an expensive one. The same result I find stated in respect to the loan made in the year 1829. At that sibility of the Minister, and the other course, namely, that which I have myself taken. It must be the object of every per son filling the situation which I have the honour to fill, to propose an operation which may be carried into immediate effect. Therefore, if you cast upon m the fixation of the price, in all probability he will fix such a price as will insure success to the operation; or in other words, he will fix a price so high as will make it perfectly certain that individuals will come in and accept his terms. While, on the other hand, the tendency of my plan being to reduce the profits in proportion as the competition is augmented, the operation of it is not likely to be so immediately completed. Therefore, the conclusion to which I arrive is, that although the fixing of a price, and of a pretty high price, may be more for the convenience of the Government of the day than by inviting competition, yet if the loan be not one of a very large extent, but one for funding a moderate proportion of the full amount of Exchequer-bills outstanding, and, above all, if there be on the part of the money market a demand for stock, a free competition among the capitalists must lead to an advantageous result. That would be the theoretical reasoning upon the subject. How is that reasoning borne out by the result of practice? I will refer to the two last operations that have been made as an answer to this question. In 1825 a funding of three millions of Exchequer-bills took place. It was during Mr. Canning's administration. The course then taken was to fix a price, and send it to the gentlemen of the Stock Exchange. Now, observe, by the theory the fixing of a price has a tendency to give a high price to the contractors. If that theory be true, a proof of it ought to be shewn in the result of the contract made by Mr. Canning. And stated, that the terms of the proposition made to the city were considered so advantageous, that although the time given for making tenders was three days, the loan was filled up in as many hours-a strong proof that the terms were too favourable. Such, then, is the reasoning upon the subject, a priori, and such is the result of the experiments of 1825 and 1829, fully supporting that reasoning. Now, a word or two on the subject of authority. As I have taken a new course, I beg to say I do not rest it merely either on reasoning or upon the result of the facts to which I have referred. I find that so early as in the year 1801, on the funding of 8,500,000 Exchequer-bills, where there was a gain or bonus given to the parties of four and five per cent., complaint was made in this House of the loss sustained by the public, and it was stated, that if the bargain had been made by competition, there would have been a better chance of the Government obtaining an advantageous offer. But I have a stronger and a much more important authority to adduce in support of the course I have taken on this subject. In 1829 this very question was agitated in the House of Commons, and on that occasion an individual whom I have always looked up to as the highest authority on any question of commerce, and as a very high authority upon questions relating to our general finances-I mean Mr. Huskissongave his opinion in favour of the course I have taken, namely, that of allowing the fullest and freest competition the money market could afford, in the place of the Government taking upon itself to name a fixed price upon its own responsibility. On the 8th of May, 1829, Mr. Huskisson stated, that "He would not now enter into the discussion as to the terms upon which the 3,000,000/, |