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

al cap;tal, together with the favings which have bcen added to it. Secondly, The firm received from perfons keeping cafh at the Bank. This hum confifts of the balances 4 n the dep fir accounts both of Government and of individuals. Io 1797, this fund, including all the balances of individuals, was only 5,130,1401. The prefent Government balances alone have been already Rated at between eleven and twelve millions, includ ing hank notes departed in the Exchequer. 'Th'rdly, The fum received in return for notes rut into circulati-m. A cu-ref Ponding value for every note mutt originally have been given, and the value thus given for notes conflitutes one part of the gene ral fund to he lent at interelt. A note holder indeed does not differ effentially from a perfun to whom a balance is due. Both ire creditors of the Bank, the one holding a note, which is the evidence of the debt due to him, the other having the evidence of an entry in the ledger of the Bank. The hum at all times running at intereff will be in exad proportion to the amount of there three funds combined, dedut . tion be i,:g made for the value of cafh and bullion. Under the three heads above mentioned, firli, of capital and favings; fecondly. balances of depart accounts ; and thirdly, notes in circulation ; all the hums are Hated which the Bank would have to charge in the event of the winding up of their of fairs ; and they mull of courfe have affets fufficient and available for this purple, which affets canannly confilt (death and bullion, and fecurities for money lent. In whatever degree,therefore, any one of the three &ft mentioned items, namely, capital, depofits, or notes, increafe, the other two remaining fixed, in the fame degree mull the (um running at interelt,increafe, pt nvided the calb and bullion do not vary ; and thi, adaptation of the rum at iniereft to the amount of the balances may be prefumed to take place without any particular cognizance of the fubjea by the Di reftors, who make a profitable ufe of the balances, by contenting fo far to fatisfy the current demands for difcount, or by making fuch loans to Govern ment, or buying fuch number of Exchequer Bills, or other fecttrities, as may fuffice to maintain in eirculs tion the accuflomed quantity of notes. It is impoffible therefore to admit, that the Bank have no means of placing out at intereß the whole of the large films which contlitute the Government balances. Thole balances ate lent at intereft. be catte a demand for loans to this extent cannot fail to irife out of the natural demand far the accußomed quantity of notes. The Bank have no property of any moment lying dead, cans and bullion excepted ; they pofiefs indeed property in buildings, but thefe are Rated in the evidence to have been paid for as they were crated, nut of their current profits, and conititute no article in their accounts. Unlefa, there fore, they have a fum at interea applicable, together with the calls and bullion, to the purpofe of anfw•er ing the demands of thofe who have depolits io their hands, they have not afters nrceffary t u fatisfy the three clafres of claimants which have been men tioned. Your Committee cannot allow the validity of an argument which is to be found in the evidence, againa the profit derived from the balance, that the Bank do not with to enlarge the fcale of their buts- nets, and that it is their cutlom to liapplefs, rather than enoonrage, the demand for their notes, nor can it be a !mitred as a general propofition, that their notes hum the criterion of their pri.fits. Since there balances are placed in their hands without interelt, and are then lent out at interell, ihey mull unquet tionably be contidered as enlarging the fcale, not merely of their bufinet, but of their profits. That the amount of notes is one criterion, and is a moll important fource of their profits, is undouht• edly true, but it is equally trne that the amount of balances is another ; and although the careful limita tion of the circulating paper is an aft of ptudence, the balances cannot be confidered as affated by fuch limitation ; nor can it be inferred, from the pro priety of limiting the paper, that there exiiis any fimilar occafinn for rettrieting the other branches of the bufinefs at the Bank. . .. The produdivc quality of the floating balances is confirmed ►y a flatemcnt prcfcntcd by the Bank RIM to the Secret Committee of the Houle of Lords in 1797, (page 132). From thuscc it appears, that the Bank Notes were, ou the 25th Feb. 17 9 7, 4.8,6 4 0,2 5 0 And the Drawing Accounts' (or Dcpnfit Accounts) and Audit Roll' (nr Unclaimed Dividends, &c ) 5,143,130 And the Surpisi' fur undivided Profit of the Bauk) which was of the uaturc of additional Capital 3 826,893 Making together C. 17597.280 This debit fide of the account exhibited the total furn due both to the Bank Proprietors and others on the 25 h February, 1797, With the exception of t 1,6.86,800- capital lent to Government, which was adverted to only at the foot of the flatemeut. The credit fide of the account enumerated the effats, (amounting to the fame turd of 17,597,28014 appli cable to the payment of that debt. Thefe Wets were Qatcd to eonfill of advance.' on Government fecurities," viz. on "land and malt" on Exchequer Bills, &c." " bills difcounted, &c." and " calh and bullion." Suppofing therefore the amount of furplos capital and bank notes on the debit fide, and the oath and bullion on the otedit tide, to continue ftationary, the amount of the other articles on the credit fide (all of them ankles pro dmicingintereQ). mutt necetrarily fitiauate in wit cot refpondence with every fltiftuation of the depofits; and in cafe another statement, formed in the fame manner as that ptefented in 1797, were now td be made out, the (um of 8,640.2501. of notes having been augmented to 16,611,3901. and the fum of 5.130,00c1. of depofits having rifen probably to about 13 or 14 million, there would unquellinnably be an increafe of about 16 or 17 millions running at in terest to be Hated on the other fide, dedufling what ever may have been added to the calls and bullion fince February, 11797. The annual and temporary bonus of five per cent whici; the Bank have for foine fucceffive years added to dub arcullomed dividends of (even per cent. ant' the recent augmentation of their regular dividend to ten per cent. exclufive of Property Tax ; the rift alai of the market price of their Nock, which having fold in 1800 from 1561. to 1721. per cent, now fell. at 2301. are thong circumstances in confirmatiot of the lam ge increase of their profits. This increaf cannot be accounted for by any material augmen beea in mine degtee adverted to ; but the propriety nictitation of the advantages derived from the ma nigement of their own capital, nor from that part of their hulinefs which they tranfad as bankers tr. individuals, (a part indeed at all times comparatively fmall in its amount) : for although the number of perfons hav • accounts open with the Bank, has been lately much increafed the floating balances on thole accr.unts are known to he in general very fmall, molt of the aecout.t , i being kept open only for the like of the opportunity which they afford of borrow. ing in the way of dilcount. The extenlion either of loans to Government, or of difcounts to the mer chants, or of both. is the neceffary etre& of the aug mentation of the Government depofits, and it is to the largenefs of there depolits that the increafed pro fits ought to he referred. _ _ The gain which the Dank have derived from the rue of one and two pound notes, amounting to 4,287,9601. on the in of February 1411, may be ex petted to eeafe whenever the payment of cal% !hall have been refumed. The next point to be confidered is whether any of the public balances may fafely admit of diminution t 'l'hofe under the firli head, namely, the balances which are lodged in the Bank by officers in the re ceipt of revenue, which make weekly payments of their cafh intu the Exchequer, evidently admit of no redtglion. Some few of the balances under the fecond head, which belong to offices of large expenditure, may perhaps be diminifhed by the more careful applica tion of an economical principle lately introduced, that of occalionally furnifhing to the heads of cettain offices, Exchequer Bills inilead of money, which hills are fold in the market in the quan►ities, and at the times which the immediate occafions of the office re. quire, and therefore diminifh the neceffity of main taining large balances in cant. The balances in the Bank, under the third head, of Unclaimed Dividends, appear to your Committee to admit of redueion. Thefe balances have been already reptefented as leis by 376,7391. than the grofs amount at which they are given by the Bank, becaufe, in confequence of the A. pallid in 1791, C. 33. that fum remains in the poffeflion of the public, out of the 500,00c1. advanced nominally by the Bank, but really taken out of the Unclaimed Divi .dends, which were then, for the fira time, brought under the notice r f Parliamew and ma.lt applicable to the public fervice. It kerns to have been an un intentional omillion in framing that flatute, that no provifion was made for making up deficiences to the public, as well as to the Bank, whenever the whole ibm of fuch Unclaimed Dividends might rife above, as well as whenever it Should fall below the (Updated amount of 600,0001. and if it Should be judged expe dient to continue and purfne the principle of that Aft, it Should be amended with a view to this objeff ; and the ufual amount of Unclaimed Dividends being al certained, it may be fit to apply to the public fervice, according to the lame regulations, whatever may probably he the furplus above the ioo,cool. which WAS intended at all times to remain in the Bank. "'she film, which, on the (cote of thole dividends, may be now applied to the public fervice, is certainly not lets than 4-43,2611. in addi inn to the 376.7391. making in all 800,0001. The Unclaimed Dividends in the hands of the Bank, amounted at that period of the year 1806, at which they were the lowell, namely, on the Sit July, to 986 5731. and at the lowa period of form antecedent yea's, they have not fallen below 900.0001. The following nnode of diminifhing the cant ba lances under the fourth head (of the Commiffioners for the Reduitit n of the National Debt), and under the fifth head (of Exchequer Money), has fuggelled irfelf to your Committee. A large part of the fum in the Exchequer is del. tined to he paid on the four quarter days to the C mmiffionets for reducing the National Debt, for Dividends on redeemed debt (landing in their names, and for Sinking Fund ; and the fum fn received by the Curnmillioners (amounting now to above two millions quarterly), is employed in thn putchafe of Kock in equal pot nuns on all the transfer days of the Succeeding quarter. It kerns expedient, that to a portion of this fum an economical principle Should be applied. It may be inferred from the paper inferted in the Appendix, and from the annexed evidence, that by the middle of each quarter a hum of more than one million is always nominally in the Exchequer, and aetually in the Dank, which is applicable at the end of the quarter to the putprife of paying the lum then due to the Corntroffi ,ncrs for reducing the National Debt. Your Committee, therefore, re commend that the fum of about one milliot Should be iffued in the middle of the next, or of tome tub Sequent quarter, to the Commiflioners, to be applied by them to the nhje& of buying up flock in the courfe of fame fucceeding months, in addition to the regular and accullomed purchafes. The means of carrying on the regular prorchafes will be fur. ninsed by ilfuing to the Commiflioners, on the quarter•day fubfequent to the ilfue of the million, a fum lets by one million than that which would have been paid to them according to the accullorned mule, and by iffuing a further million fix weeks after that quarter day, by which time the Exche quer will be able to lupply it. Affuming that the' lame mode of iffuing all firms due to the Comtnif fioners at half quarterly, inflead of quarterly periods, may continue, the drat of the propnfed meafure will be to give, in the year in which it is to take place, a clear million Belling to the Sinking Fund, by the application of which, in that year, annuities amounting to neatly 50,0001. per annum may be bought up, the other operations of the Sinking Fund ,:ontinuing precifely as before. In confequence of the application of this extra million to the extinflion if debt, there mull be a redullion of one million in all the future balances of the Exchequer money in he Bank, during the lall fix weeks of every quarter, and a Similar recluelion in the future balances of 'he Ci•mmitlioners for the teduelion of the National Debt lodged in the Bank during the fiat fix weeks af every quarter. A reduetion to this extent is prat• icable at prefent, and a further teduaion may, on imilar principles, be made at any future period, • hen the increafed amount of the Sinking Fund, ind of the balances of calh in the hands of the Com. mitlioners, Shall affird Similar teali , n4 for repeating he fame operation. By this anticipation, the Ex• chequer money dellined to pay the fun' due to the Commiffioners of the Sinking Fund, would not he beetled from its original purpnfe, but a portion of •-t would be applied fomewbat earlier tai that olleEt, and in addition to the original futt, add the public creditor mull unquellicumbly be benefited by fucb an augmentation of the Sinking Fund. If the preceding propofttion thould be deemed liable to objeCtion on account of the preference, f) far as refpcits one million, which is propnfed to be given to the Commiffloners for the Sinking Fund, giver the general body of Stockholders, the objeBion may be removed, by giving to the Stockholders a preference to which they are not now entitled, as a compenfation, empowering them to receive on the quarter day ihe whole of their dividends nn Rock, antecedently to the Mite of any dividends on the (Lock of the Commit loners. Such being the general Rate of the conneltion I between the public and the Bank, it becomes an üb jcEt of conlideration, in the lali place, what have been the tranfaCtions between them lince the year 1786 ? There are, firfi, the fiatute of t 791 ; fecondly, the renewal of the Charter in i 800 ; and thirdly, the agreement for the loan of 3,000,0001. in 1806. Fiat, The Alt of !Is'', c. 33, authorifed the Bank to advance 300,0001. without intetell, for the fervice 4 the public, which Came in fad, as has been al. ready explained, out of the ,thiclaimed Dividends, but in confequence of the fecond claufe for repay ment, in cafe of a deficiency, the fum remaining in the hands of the public, is not store than 3764391. there being no provifion for inctearing it after the diminution had once taken place. It was a further enaftment of this flatute; that the allowance for managing the debt thould c , ntinue at the rate of 4301. per million ; and it is t.bfervable, that this is the only ftatute which contains a.ry dittinEt itipulation upon that point. The Committee on Fmance, in 1797, dillinguithed the debt created fubfequent to 1791, from that which' is wi'hin the obligation of this Aft, remaiking ex. prefsly, that " Since that year the cafe is different, and no Inch Ripolati ns cult. All the fubtiquent Loan Ass, and thofe for funding Exchequer, Navy, and Vidtualling Bills, have left the contra& open, referving a power to the Treafury to make any fuch compenfation as &mild be reafonable." Secondly, by the Aet 4o Geo. 111. c 28. the Bank Charter was continued until eft Auguft 1833. or, condition of three millions being advanced for the public fe►vice, without interefl, for fix years ending sth April 1806 the Pole-tight of banking as a Cor porate Body, and the other privileges, are fully re cited and confirmed but nothing is exprefsly flipu lated with regard to the rate of allowance for manag ing the debt. . The following, however, is the claufe relating to this part of the fubjea And for the encouragement of the (aid Governor and Com pany of the Bank of England and their ruceeitars, to exchange and circulate the raid Excb, quer Bills, in the manner and during the time herein before mentioned, and to the end that the laid Gover nor and Company, and their fueedrors, may have a competent re commence and eonfideration for fo doing, it is hereby declared and enacted, That Inch part of the raid recited provi6,m contained ht the raid ad made in the at ft year of the reign of hi. pram Ma jcity ,as relates to the determining the raid fund of one hundred thoufand pounds per annum. and the Paid Corporation of the Go. ranee and Company of the Bank of England, upon the notice and payments therein mentioned, Bull be and is hereby repe.ded and made void ; and that the raid Governor and Company of the Bank of England, and their fueedrors for ever, dull remain, con tinne, and be one body corporate and politic, by the name afore. raid, and mall for ever have, receive, and enjoy the raid entire yearly fund of one hundred thoufand pounds. out of the raid rates and duties of excife, together with a perpetual fuecelßon and pri ' allege of exelufive banking, as hereinafter Is mentioned, and all other abilities. capacities, powers, authorities, franehifes immuni ties, exemptions, privileges, profits, emoluments, benefits, and ad vantages whatever. which the Governor and Company of the Bank of England puffers and enjoy, or whereunto they arc, or be fore the snaking of this as were ,titled by the Paid adts of the feventh and twelfth years of the reign of her late Majelly Ct2een Anne, and the Paid ads of the fifteenth year of the reign of his late Majefty King George the Second, and of the fourth and twenty first years of the reign of his prc(cnt Majefty, or any of them. or by any other ad or ads of Parliament, grants, or charters wind°. ever, now in force, or by virtue of any employment by or on be half of the public ; all which are by this adt ratified and codirmed to the (aid Governor and Company, and their rucceirors. freed and di :Charged and from the raid provifo and conditions of redemp tion hereby repealcd,or intended to be repealed as aforefaid ; and all other pnorifoee, powers, acts, matters, and things whatfoever hcretvfore had. made, done, or committed, for redeeming. deter. mining, or making void the raid Corporation, or tbt raid yearly fund of one hundred thcufand pounds, and the raid privilege of eultdive banking, and all other their abilities, capacities, powers, authorities, franchires, immunities, exemptions pr vileges. profits, emoluments, ben( fits, and advantages, or any of them, fut.ject ne verthelefs, to fuch teitridions, rules, and diredions, and alfo to fuel% other agreements, matters, and things, u in the laid Ads and Charters,or any of them now in force, are cont..lned or prefcribed, and alto tubjedt to the power and condition of redemption herein after in this adt contained iu this behalf," The circumflataces attending this negociation are related in the ee,idence of Mr. Thornton, who was at that time Governor of the Bank, and from whom the fuggetlirn of renewing the chatter originally came. kle dates, that the various ((tutees from which the Bank derive profit, in confequence of their exclufive privilege, and of their connexion a ith Government, were enumerated by Mr. Pitt, who made a claim on the part of the public for a dire& participatil,n in the prt fits, according to a fixed prt portion ; and that the claim, though not admi:ted in it► fall extent by him. felf on the part of the Company, was ultirm tcly agreed to; that A calculation was fumed upon the balls of luch participation, and that the interefl of three millions, for fix years. was given to the public as the fair refult. The authority therefore of Mr. Pitt, and the con fent of the then Governfir of the Bank, ellablithed a general principle of participation in thofe profits of the Bank, which arife from their exchilive privilege, and from the balances of public money in their hands, and whether the participation be fuppofed to be in the fixed proportion of t-4. t 3 or t 2, it cannot fail to be extremely confiderable. In one of the converfatimis upon this fobjed, it ap pears to hate been dittin.lly affirmed on one fide, and to have been admitted on the other, that the Govern ment balances in the Bank which were drawn from the Exchequer (eßimated then by Mr. Pitt, as they dearly were, at two millions and a half on an act. rage,) and the growing balances of the Commillioners for the Sinking Fund, were productive of profit, and an expedation is Paid to have been given, that they thin'ld not be withdrawn from the Bank wiihont compenfation. The produdive quality of lonic of the Government balances being admitted, it is not eafy to conceive.that the Bank have any method, ix. cept that of increafmg their caul and bullion, of pre venting the produdive quality of the fame balances when enlarged to the extent that they now ate, or of other balances which have been added. The circunsflance of the Bitnk gaining a profit by the management of the public debt, appears to have of the rate or allowance then fubfiuing did not come partkularly under confidatation. The documents beeeffary to fah; A correft opininn bnnh the c. MTV. cated concerns of this extenfive were pro: bably not fully before either of the two. parties at the time of this agreement ; it is ebvinut, that they cannot be collated without confiderable and detailed invehigation, nor digelted without indufify and at. tention ; and the preffure of other duties that' well account fir. a wait of Icifure for fo laboriou s a re fearch at the period of the renewal of the charter. The other balanCes of pitb is money do n o t a p peal to have entered i a to Mr. Pitt'. calculation, as they were at that lime of trifling amount, and the pro bability of any fuch inc cafe as has atually taken place in the balances drawh from the Exchequer, in confequence of the great augmentation of revenue (an inereafe from an average Nib tff two millions and a half to an average (um tit five or flit millions) was not adverted to, and can hardly be fuppoied to have been in contemplation, Suppofing all the fuggeflions which your Ci.mmiti tee have made with a view of diminithing the ba. lances in the Bank to be adopted, the atro.unt of balances Hill remaining will pri.balsly more thud double the amount of thole which e eI in 'soot or which could then be contemplated as likely td exift at this time ; ani therefore, it the intention 6t Mr. Pitt not to withdraw the balances of Exchequei money, or thole arifing from the • cumulati‘ n of thE then exilling Sinking Fund, without comprnfrtion, fhould be adhered to, that intention will not he ft ttf trated ; the unexpated enlargement of the fame balances, and the addition of to many whirs, tottnig much more than the c.onpenfation in quation. Thirdly, The lan agreement with the Back which it Will be neceffary to notice, was in 0106, 46 Geo. 111. c. 41. when-the three millions which ought to have Seen repaid on the sth April, were continued as a loan to the public until fix months after the ra tification of a definitive treaty of peace, at an inte tell of 31. per cent. which is to be confidered as a gift of 60,0001. per annum, fo long as the war cnntinnes. Whether this bargain was c .4. cluded upon an exanti. nation fuflicientlf comprehenfive of the genet al fi uaa tion of the Bank, is not now the quellion ; but the tranfation is molt material in another view, as it evince; that the a;reement made in ;Soo, was not confoiered either by thole who ailed upon the part of the public, or by the Bank Dire dots themfelves, as a bar againft further participation, whenever the in creafe of their profits derived from the public, ;tad the circumflances of public affairs, might, upon lar principles, make fuel' a claim reafonable And expedient. After a fnmmary recapitulation of the advantages which the Bank derive from their charter. and from their connation with the public, it will be proper to enumerate the benefit' which the public receive front them in return. ft, A large profit on the management of the public debt is en joyed by the Bank ; and, adly, the interefi, ari6ug from between and a a millions of Government balances lying in their hands. idly, They have whatever profit is to be derived tram their paper eirew:ation. amounting to i6,6xt,3901. the Hike of which refu is (tom the exclutive powers giren to them by their chlrter. It may be remarked. however, that it is a circulation of which they care fully limit the amount, and on account of which, as well as with a view to the general demands of the State, they ard fuhj. et to the burden of ordinarily maintaining a large flock of cam and bullion, and of providing, except during the fulpeofion of pay. taunts to cab, all the gold and filvce uteri for the coinage of money. The advantages which Government, on the part of the id, The capital (t t ,686,00 d.) of the Bank is lent to the pub lie at the rate of 31 per cent. The benefit derived from this loan, amounting at preterit to 233.7 tot. is not ftated in the annexed evi dence, as having t:eien particularly adverted to in the cony. dada's which took place between Mr Pitt and the Governor of the Bask, on the nccafion of the renewal of the charter, but the continuance of this benefit to the public is fecured by the adt. ad.—Advances are made to the extent of 2.735.0001. upon the annual lend and malt taxes, or the duties fubltituted, at aninterett of 41. per cent. The ettalilitheel cultom of lending to this extent, at a moderate intereft, mutt undoubtedly Ix wondered as an in tended compentation, in part, for the benefit which the bank de rive tram the ufe of public money. 3d.—A fum of three millions was loot to Government. as has teen already flated, without loft-reit, for fix years from tBoa, as the price of the renewal of the batik charter; and it was agreed its rBo6. that the fame fhould be lest at 31. per cent during the coo , tinuance of the war. A:Either direft advantage derived to the public, confills in the receipt at the hank of the Property Tax upc.n tie dividends, and the prompt payment of it into the E xchequer, without charge or extra allowance ; by which means all delay is obviated in the collalion of a large pot thin f the war taxer, and the expenfe of aficers is laved. The Rock transferred to the Comn►iflioners for ledocing the National Debt, and on account of the tedreption of Land Tax, is not charged by the bank with any allowance for management, which two lons amount to about 134,c00,0001. exclufive of South Sea Annuities. ptadice of making advances upon certain in flAlments of the public loans, on the fertility of the receipts, is a confider able accommodation to the fub fcribers, and enables the G.lvernmenl! to contra& for loans upon. terms fornewhat more advantageous than could be done if that lability were not afforded elle batik, however, receive in return the legal rare of interefl, as they do alto upon all tranfaftions with the G ,, veinment, except thole already Bated. The accommodation derived by the public from its con nexion with the bank, have been cart ied in tome years to a very large amount, and it mutt always be con lideled as au (skied of the greaten confequence to maintain the per inanence of an ellablifitment of loch opulence and credit, which, by the judicious condua of its own affairs, hits contributed fo materially to extend the commercial prolperity, and to maintain the public faith of the country. Your Committee cannot conclude their Repine s without bearing teitimony to the favourable ditpoG lion In often manifedad on the part of the Bank towards the public fervice ; and they entertain AO doubt of the fame readinefs to accede to any egni• table arrangement that may be propofed under the prefent circumflances. DIFD. A few day. (ince, near Pieter, Mil. Jane Pare, aged tt.feraed daughter of Colvin! Parc, late Infritiog Field Meer of the lyf. rich On the z stlt ult. at Aogbton , near Ormedrk, aged near ioo years, Mr. Richard Brighoefe, leaving a widow to whom he had been married yo years. Monday fennight. at his houfe in St. Peter.ftceet, Wiochefter, the Rev. John Wuodbourn, Senior Rettor of Rusuncy and Lizde tots..gad 6a years. MOM WATER' Ar - LONDUN BRIDGE I'9-MORRO W bitort.ing 43 minutes after • 10 After: oms ►s adolstm LONDON: Priited and publlthei by LEVEL RENT, (dCan terbtary-Place,_ Lambeth) at the STA It.olr FICIs N Care 1 4 greet. P'll , itel A tiro at the Sra a-Or tic t. TeidPie-mr•