Star. — London, England, 1807-09-11 00:00:00

r THE SEC3ND REPORT vms UNITED KINUDOM. Yin% THE COMMICTEE ox THE HIBLIC FXPFNnITURE, rm 'ENE RANK MF ENGLAND. The Ctammiatee appnitited tp examine and ennfider what regalia Lions an' checks have been eflabilfbed, in order to eoturnal the feveral branches of the Public Fxpendi•ure in Great Britain and Ireland ; and how far the fame have been effeetual ; and what further n lures cm he adopted lot reducing any part of the faLd Expenditure. or dimitiifhing the amount of Salaries and Emoluments, without detriment to the Public Service : Dire led their earlieft inquiries to the management of the Public Debt, which the Committee on Finance in 1797, pointed out as the fi-ft objeet under the head of expendi ore. in their XlVth report. The annual charge is of no inc-nfiderable magnitude ; end the following obfervarions are intended to thew how far it may admit of redo inn. The rate of allowance fettled in 1786 has not been ied !ince ; but nn documents are preferred at the Treafury, or the Bank, containing any calcula Lions upon which it was founded. The propofal was made by Mr. Pitt, under general eonfulerations of " the increafed amount of the dLht," and a reliance on the difpufitinn of " the Bank to Rive every tea fonable accommodation to the public." The titre at which the agreement was concluded, affording a profpelt of continued peace, could mfent no expec tation of a fpeedy augmentation of the debt, much lets rut filch an augmentation as has 'lnce been in. cu. red. Whatever may have been the enmputatinn urn which the bargain wasenneluded, it is to be obrerved that the towel rate at which a part of the debt was then managed (being 3601. per million) was not adopted as the flandard ; and confeeptently, upon the annuities created in 1726, an inconfiderable in mare of expence accri... 1 in equAiring the whole, while upon every other part of the debt, a I trge Paving was effcaed by reducing the allowance from 5621. tos. to 4501. for each million. The management of the public funds differs fo matetially in prailice from all other mercantile or banking tranraainns, that it is n .t ear, to e tl a blins a fatisfaaoty critetion fisr fixing the commillion at which In extenfive and complicated a concern ought to be concluded; but these are two inflar.ces, the fame in kind, and differing only in degree, which de ferve attention, as they tend to throw Come light upon the fubjea. The fit ft ot there is that of the South Sea Com pany, which c-ntinues to manage its own portion nt the debt according to she original allowances ; the arrangements with the Batik in 1756, not having been extended to this company, a circumnance which at !rafted the notice cr the Oimmittee on Finance, (XIV. tl.) who remarked. that, whether any fur ther teduainc can or ought to be made in this rate of allowance." was a point GI for the wifdom of Parlia ment to decide." Upon the part of the debt which forms the South Sea Stock, the rate of charge is not uniform. The proportion 0(5821. r3s. 6d. to each million, obtains with regard to the greater part, and the allowance upon the remainder beats the proportion of 5621. to , . to each million. The whole expenfe of managing this concern by the comp iny was, in the year ending sth January 1807, 10,7271.1. f which 36921. was paid to the rub and deputy g :vern rs and direaors, in number 23, and 47351. to the desks and (dims, in number 36. The rum annually paid by the public to the South Sea Company, is 14 7131. to . 61. and about 701. more for fees and allowances to the cafhier. Tire prop-rti sn which the falasies of the clerks bear to the whole ex7endittne dere:yes notice, and alto the great number of the direaors, *lmo(' equal to thole who fupet intend the extenfive bufiners ot the Bank. The fecond example recurs in the more recent agreement made with the bank of Ireland, by OA tote 4o Geo. 111. cap 3. in which the precife allow ances then and niqv given to the bank of England, were fixed as the Ilandard fir managing the Irith debt, though the debt of Ireland did not, in that year, equal the capital of the Siiuth Pea Company, being between 21 and 22 The management of the public debt in America May alto afford force illir:lration of this fuhjeet, though k differs in one ma•erial rerpea from the bufinels tranfaard by the bank of England, inalintich as the bunks of the United States undertake merely the payment of the, dividends, the transfers being made at the public offices of the Government. Uaiin this account, and from limited number of Rock hi,ldert, who do not exceed 15,000, their trouble. expenfe, and sige fearer!) , admit nf companion with the B ink of England. rhe American banks trait(' 2,1 this bbfiners free of all expence to the Govern nent; the balances left in their hands, which are OW for their advantage, lilt * thole dep. feted with any private banker, being confidered as a fufficient ccm perdition, Affirming as an incontrovertible prnporit ion, appli cable to all mercantile concerns, that, in proportion as the Peale of bdiners becomes enlarged, the rate of commiffion may be reduced, and that a moderate commitfion upon a large bufinefa produces a greater proportionate profit than a higher rate upon one mote•confined, it is obvious that a charge of allow ance, which m a p be tearonable Upon 20 or 25 mil itnlS, becomes protufe alit' extravagant upon 5;.:.t or 6Y3 millions. anual pregref. of the debt come* next to be c.auider ed, which, on Jan. 5, 1786, was 2 24,1024241 .t.‘d the charges of management wet e then, accor.ling to the reduc:d kale of allowances, t 00,3461. On the 3 1 i January, 1797, the year in which the Committee on Finance reported, the principal of debt untedeem ed WU 2 721892.4441. the charges of mimagement up , n which , fu far as concerned the Bank, were "i• 54 3 1. On the sth January, tBoc, the year of the renewal of the charter, the principal of debt unredeemed was 17 6 485,8011 9 and the charges of management re• ceived by the bank Were t 7.;,i.; 31. The debt unredeemed on the ph January, 1837, wac 55 - 40,341. and the charge* of management received by the bank were 265,8'81 to which mull be added 56871. on account rd the Aulirian Loan, occuichng to the tame rate of commiffiun. The allowance of 400 cl. wwaids the expences of tLe Hanre, and alto the original allowance of 18981. oft 4.c00,0001. purchared from the South Sea Company, are in addi'ion to the before mentioned fume. The increafe in the enablithment of the Bank, which has been rendered necefr.rry by the progreflive augmentation of this branch of their bull iefs, contitls principally in a large addition t.i the number or etc? ks ; of whom the whole number employed in the public bonnet's, exclotively, or principally, wac in *786, 243 ; in 1796, 313 ; and in tBc7, 450 ; whore falaties, it is p courted, may he calculated, at an average, at between t so!. and 17(1. for each cletk ; taking them at 1351. which exceeis the average of thole employed in the South Sea Houfe, the film is 6 0.73 0 at trot. the font h 67 soo at t ;a the him is O s seo either of which two laft Corns would probably be futEcient to provide a foperannuatiun fund. The very moderate falaries received by the G nor, Deputy G Ivernor, and DiteSors, amount to between 7 an.] 80001. ; and only a part of thefe mull be conlidered as cotnpeinfatinn for the - trouble of cuperinteneing the pnbli: incidental exper.fes and fundries may be eftimated at about C 15.031 Buildings additional. and Repair•, e about • zo,oso I.aw Fxpences, and luffes by frAuds and forgeries, at about - 10,000 Without being ton minute in endeavouring to cal cnlate what increafe may have taken place in thefe IA articles, of which the Bank do not keep any account, it is to be noticed that the whole increafe of the officers who aaually tranfait the hu finefs, in the last eleven years, is only 137, ,hone annual expenfe may be from 118,4491. to 23,290 t. ; 'he addition to the other permanent charges being probably about one half, or two thirds of that fum ; but that the additional allowance for management in the IA ten year, is more than 155,0001. This ge• neral conjatural eftima.e of the expences actually incurred by the Bank exhibits, if it be near the truth, the charge which would have attended the manage ment of this linfinefs by G orernment, if previous to the arran 4 ervient which took place in 1786, it had been 'bought advifeahle to adopt the fity.fefli n, racily made by the auditors of public acc tints, when this whole matter was referred toahem by the treakit y. Their report, already prirted in XIV. 30. well deferves the c nfideration r f the Houle; and parti• cularly the e4imate they formed of the teal value of the fervice, which they fuppofed might be executed at lefs than one-third of the charge at that tune incur red, that ie, at the rate of allowance under 1871. los. for each million, when the debt was ao larger than has been before tinted. Your Committee, however they may approve the &nerd' principle of the teaG►ning contained in that report, are far from thinking that fuel' a tranbfer of min 4getrent would have been expedient, or delirable in itfelf, being If opinion that the debt can be MA nA g e d no wh e re more commodioufly, and that it ()tight no where to be managed fo cheaply, a• at the auk. The Committee on Finance Co far agreed with the auditors of the public accounts, as to intimate an opini‘ n in favour of the redutti'•n of the exulting rate of allowance for managing the public deb , . They nee " that the Bank, over and above the charger of management, Nee accuflomed to receive allowances from the public, at the rate of 8051. iss. tod. per ro caving contributions lir loans ;—and toool. or forr.etinse* for contributions to the hotter y ; and - that they have the benefit of holding all the money for half yearly dividends, betides hav ing the cultody of cafh forthe navy and at my fervices. " Upon reviewing, therefore, thefe circumltances in the prelim times (1797), and without qnefli ming the propriety of the al rangement made in t 786, when the public debt was Co much inferior in amount, y o ur Committee c moot forbear to !tate it as a quef lion fill deferving the attention of Parliament, whe• then a I urther reduaion of expence cannot, and ought not, to be made upon this branch of public expen diture ?" Betides the management of the debt, the Bank have large traufaetions with the public, affording a conlidetable pr• fit to the C rpolation ; into the na cure and amount of which, for the purpofe of laying the whole matter before the Houle, it is proper to enter. The amount of the feveral hiLinces of public money, lying in their hand., are fit a to be Rated. t. The average balance of zhe cads kept at the Bank during the three ni"ntho ending the tth of January, tBoy, under the head of Cultom•, Ezeik,at d Scary, appears to have becn about 1-43 71coo and under the bead or the Volt Office,durirg fevtral months in 1807, in which year that accutts.t was ft: ft opened, about • 10,5C0 1.• 47740 a. The average balance of fundry other accounts du ing a frmil :r period of three months, to tth Ja nuary, 'B4, viz under the head of Paymafter Ge neral of the Forces, Treafurer of the Navy, Trea furer of the Ordnance, Barrack Matter General, Tranfport Office, Agest Gtneral of the Volunteers, Trealuttr of cbelles Hofyital, Surveyor Central of Woods and &wefts, Accountant General of the Court of Chancery, and Commit/loners for the Re duiftion of the Land Tax 1 .33 1 974 3. The average amount of Unclaimed Dividends in the h .nds of the BAIA, during the year 180, ap pears ro have been L 3411154 Detii.a the turn !cot to Government on that at count without intuelt - 176,739 964,41 S 4. The averag: balance during the period of three • months, to stb January, s 8:4, in unhands of Com nsilliotters fur the ftedudtion of the Natknal Debt, sang from the Dividemds received by the Cottimif- Goners on the Stock purehafed by them, and trout the Me of Sitikirg Fund Money I,41& .073 4,461,962 S. A further balance of cub to a very large amount, coil its of fume lying nominally in the Exchequer, which neverthclefs adtually accumulate fur the benefit of the Bank, and are fur the mutt part appl.cable at the end of each quarter, to the payment of Dividends It is the edabliihed ufage at the Batik to draw daily from the Exchequer the vcral lama in queftion as they accrue, depufiting indeed Eachequer Bills in return tor their own Notes, which are received as meaty. This dep , ifit is to be coeifidertal imply as a fecurity for the public money drawn away, as the growing intereft on the Exchequer Bills belongs entirely to the Batik; and in cafe all the Each, quer Bills piiffeifed by the Bank, which they think fit to apply to this purr(* ) prove ii.fulliciesit for the whole fum, the fumble ruuiiw in the Exclacquer in the &ape of Bark Netts. The mites thus taken oat of circulation emotrt necafionally to ketml millions, and Their detention in the Excheq uer . b o th the B a and the Public arc placed in circurnitances fubftantially the fame as if the notes in quellion were carried to the Bank, and ennflituted a halance due to the pub lic on a dart& ace unt, differing in no refped from other depnfits. The total emotion of Fat:by - Tier Money, by which the bank may thus have pn.litcd. was Eschrqutr Bank bills. Notes. Total Sum. In ill 6 -- _ Jan. 10 2 949 003 8,10) 8 .9371" Frb. 7 2,745,000 9.010 2,7(4,0'0 March 7 4.- ts too ts .8 0 4,733,800 Ditto a 8 6,739,373 15,900 6.754,9 April 2$ 4,997 033 11.•03 5,008,3-0 May 23 5 srag.ooo Lot 7 400 6.965410 June 23 6 009,003 3,014 8:0 9.023 830 July is 4 3 Lc"...0 J 1.603 4 jzo 6 0 Aug. t 5 4,780,003 •. 11,1814.800 003,200 Sept 18 4,326,r03 4t t 5.1100 8,84 EX* Oct. to 5,102.000 4.019 no 9 ,121 .7 00 Nov. 7 4.270.030 1,5 t a,BOO 5,788.803 Dee. 5 3,873,000 3,007 ,233 6,877,20.3 Dec. 19 4398,000 3,012.100 7 4t0,200 653 6a OCO 21 189.00 e 86 ;51,030 The averast amount of this total fum to 6.167,928 £t0,6z9,890 To this turn may be added a balance of a tem porary nature, which has remained for no inemta derahle time in the Bank, on account of the Com milßotters under the Convenlon with the United State, of America. and which is part of Ocsa,cool. originally depofited and gradually reduced to - 475,C19 Total average balances L 11,104,919 Your Comm;l tee are aware, that in thus exhibiting average balances of cafh in the Bank, inflead of the feveral a&ual balances, they may paGhly be confi dered as prefenting an unfair view of the fubjeet ; but it mull he obrerved, that however fluetuating many of the ind;vidual balances may be, the aggre gate is never likely to vary materially : and that in partictalar if the balances of Exchequer money, which are moderate in the early part of each quarter, and extremely large towards the cnncltdi m of it, are compared with the balances of the Commiffinners for the Sinking Fund, and t'inle on account of unpaid Dividends, both i f which are large in the beginning ) f each quarter, and frnall towards the end, the ag 4regate film utOer thee p• incipal heads will be found to (moan A ttationary balance of a sw.ti important amount. The documents from the Bank, and the Exchequer, which could conveniently be furnithed, Jo not atrird an exact liatement of the whole aflual balance of public money in the hands of the Bank, on any great number of fepara e and given days ; they, however, give the following ref - At., viz. That on the a ath Oautser, illas the time immed ately preced ceding the payment of the dividends ' the cum in the hands of the Bank, under the brit-mentioned hea l of Cuitoms, &c. was 176.974 Under the ad head, of Paymafier-General, ate. 18 0 - 78,9c0 Under the 3d head of Unetaime4 Di vidends on the 4.6 Odober 1,01,1.175 Daus% 376 739 ---.. 656,436 Under the 4th head of the Commit - - losers for the Sinking Fund on the t 7th of °dotter 3 8 9, 1 97 . . - An•i under the sth head of Exchrqu• e Munil, they were on the Toth October, !king •he day on which the Fschequer Monthly Accounts were made up 9 121,700 too 6,.133 Making the Total on the 9th, toth, and t tth 1806 11.723 so? To which, if tke money veiled in the American Comn itSoners be added 475429 The total adual halantes will be L. ts.t9t3 236 They alt. (hew, that on the tft November, a period of about three weeks/eV-pent ro the payment of the thvideods, the ha lances under the fiat head, of Cullom,, &c. wire hat 33 Under the recoil& of l'Arnattee, &c. 1.356,:Ns Under the third, of. Uticlaimed 1 Dividends 1 459. 1 44 Dedudt as before 376429 1,182 435 Under the fourth beta, of Sinking/ 2,217.17: Fund And under the fifth of Fzcbcquer Money, they were, cn the 7th Nevem. her, the day on which the Fiche quer Monthly Ace• nuts were made up (being 4.170 Fichequer Bills, and 1,54 7,800 Batik Note,) 5.:81,8e9 9,t8z.376 Money of American Commitßoners ti,t41363 475,029 Making the tn•al aetual batmees on tbc tit and 7th November, 18:6 kit. 23,09 They alts thew that, On the tit Dec. the Cuitorno,&c were L 954,733 On 29th Nov Paymaiter, &c. 2,40.3,155 On tit Dec. Unclaimed Dividends t.t7t.t 9 Dcdu& .376.739 79 6 39 3 On agth New. Sirkirg Fund 1,5 ti,lirs jib Dec Exchequer Bills 3,870p00 Bank Notes 3,011 20) 6.877,z^K. !f 4C5 To-eth,:r Money of American Commillioncre I g ..5 . 41.295 475,029 Total t2.0t8,324 They alto thew that On Bth Nov. Cuftoms, &e. were 5 8 7.9 3 4 On Do. Paymafter, Sec. 1 4 1 .5. 8 53 On Do. unclaimed, Dividends probably I 461,0e0 Deduitt 3761739 e.c 80.261 On Du. Sicking Fund 2016,363 7 Nov Exchequer: Exchequer Dills 6,427=0 Bala Flutes e -Sz S3co I,s t s b Sco 1 -' ' ----"--" 8 981,124 Together 10,986,1 7 t Money of American Cosnotifloners 475,129 Total t t,a6t ,aco It this appears that the aggregate aelual balances. in four di& ferrnt Kilo& of the quartrr rniling sth January 11107, fo far as tilde balances can be stared , fluduatrtl only between the funs of L t 0, 9 86 ,1 71 and SI« It 713,207 : 475 C 29 L 471.0.9 1 t 461.100 11.198,236 The excels of the aftual balances of this petind above the average balances before Rated, miles from the ciscumflance of its having been thought proper, in liming thole average balances, to form the mate of the average calh in the Exchequer, from an account of the "hole year. The magnitude of thefe balances, aid of the profit which mull be derived from them, a profit which is likely to increafe during the war, but which may be fohjeet to diminution on the return of peace) has attrafted the attention of your Coen mi , ree no lets Chap that of the allowance for the management of the National Debt. The annual interett calculated upon them amounts to between g and 600,0001. In the cafe of a private banker, floating balances cannot be cnnfidered as prnduetive of a profit equal, or nearly equal, to the whole interell upon thein—be canfe both the charges of the management of the concern, and the interefl hilt by maintaining the Rock rf ready money, deemed neccifary for fecuring the plinatiality of current payments, operate largely in diminution of filch profit—but in the cafe of the Bank of England, the charges belonging to their banking tranfaCtions with Government mutt evidently be (mall in comparifnn with the profits on th , .te d eceive tranfaftions. The aggregate balances of pub. lic money, in the hands of the Bank, have been (hewn to admit of no great fluEtuations ; nor do they require to be provided for (efpecially at the prefent period) by means of a flock of unproduftive money, the notes of the Bank itfelf being employed t. meet any fuch occafion. Your Committee therefore are inclined to confider a fain equal to five per cent. interelt on the average balances in queftion to be not far from the am unit of the profitsatifing from this fource. Thefe profits undoubtedly are intermixed with the other profits of the Batik, bin their general amount may, without difficulty, be dillinguilhed and afcertained. Except ing the film gained by the management of Vac public debt, and of loans and lotteries, and by trade in b►tl lion, the whole gain of the Bank mull obvioully con lift of interell on vaiieus fum• lent ; and •he amount of the daily intere9 fo accruing, mull necefratily hear an exaft proportion to the total daily a mount of th e feveral funds in their hands, deduction being made for that part only, which is kept invelled in call' and thefe being the only unproduaive articles of any moment in which their funds can be employed. "But as lime doubts maybe excited by the annexes' evidence, ref peOing the productive quality of fume of thefe balances, it teems proper to enter fully into the fubjed ; in doing which, the circumllances which accompany and follow each augmentation of the Go• vernment balances, mutt be minutely detailed. Whenever an addition is made to the amount of thefe balances, it is effected in general by a payment into the Bank of their Lwn notes. The notes fo paid in are cancelled. Thus a reclueliin takes place in the circulating notes, and there notes are a tend, which ruppiies, iri the fame manner as the Government ba lances, the means of lending at interest. Every (itch redueti •n of notes, however, mutt be con fidered as temporary, hecaufe the maintenance of the circulating hank paper at the accnßnmed, or nearly the accuf thmed pLitit, is felt by the hankers arid merchants of the metropolis to be neceftury to the regulatity of current payments. Bills of exchange are therefore .ffered to the Bank to be difcounted, in filch quantity as to reltnre the amount, or nearly the amount of notes cancelled by means of any increafe of balances, unlers the B ink itfelf, by delivering uut notes in pay. ment for exchequer bills which they may have bought, or I , r loans to Government, fh iuld have rendered the application fur additional difcounts unnecetTary.— rhis application for additional difcounts, on the nc cation of an increafe of balances, mutt indeed ordi narily precede fuels increafe, and furnish the means of elf,taing it. That the great augmentation of Government ba lances in the Bank, which has taken place (lace the year 1797, (an augmentation amounting probably to (even or eight millian,), has not permanently dimi nailed the ri rtes in circulation, is proved by the an. nexed account of notes in circulation between the 7th I February, 1795, and tit February, IEIO7, by which it appears that the notes, exciufive of tl. and al. notes, were— On 7 Feb. 1795 sa,B7a,sbo 6 Frb. 1795 st,sts,ooo And on 1 Feb. ego() 1a,856,77* And t Feb. 13°7 22 .333,433 The fluftuation in thole twelve years (with the ex ception of a Ihnit period preceding the fufpention of the cash payments) was only between the firms of I /,0 9 . 3 8 0 1. and 13,8458001. to which lalt men. tinned !urn they am.utited on the 25:h January t Sot, a period not long fubfecinent to t).•e day of paying the dividends, when a more than ordinary ate of paper mull be fuppofed to have taken place. Since there fore each augmentation of the Government balances, though it may at fi it be attended by a diminution of ' bank paper, is followed by a proporti mate re ilTue of that paper, and fince, in return for the paper fa re-iffued, additional bills are difcounted, additional exchequer bills are bhught, or additional loans are furnilhed to Government, (all articles equally yield ing interen,) it follows that thole additions which are made to the balances mull be confidered as pro. clueing a currefponding increafe ct interelt. The pro portion. will be exad, whenever the notes ruppreffed are welly rellored, provided the quantity of cafh and bullion continues precifely the fame. Whether the call' and bullion in the Bank have been augmented fince the fame period of 1797, and if augmented, whether in any material degree: on the ground of the increafed magnitude of the balan ces due from the Bank to Government, is a queltion I into which your Committee :annot, from the want of documents, particularly enter. They conceive, however, that if an augmentation of the calls and bul lion be admitted, it mull beconfidered as principally intended to meet any demand 1..) which the Bank may be expofed by its circulating paper, and efpeci ally as a provision for the payment of their one and two pound notes, the eiretditints of which may ceafe whenever the Bank Shall have refumed its payments in cash. In the evidence upon this part of the fubje&, it is admitted, that the notes of the Bank are prodadive of profit ; but it appears to be atiumed, that t4e Go vernment balances are only to in proration .' they tend to augment the am'unt of notes ; whereas your Committee are fully pet-Ina:Jed that both halaneesand notes are, and mutt neceilarily be, produdtive. The funds of the Bank, which are the ((mats of profit, and which contlitute the meafure-of the fum they have to lend, (fobjed only to a deduftion on account of calls and bullion), may be clatfed under three heads. Fill, The (urn received from their Proprietors,