The Sun. — London, England, 1854-03-07 00:00:00

tiolUtion that theleipirieses Of the war shat be borne by ad ditions to taxes • but yet it is•poseible for us to do this— to lay down a set rule upon the matter, and to determine that so long as th ose b ur d ens are compa tible with the prin ciple, and so long as the supply necessary for the service of the year can be raised within the year, for so long not to resort to any loan. (Loud cheers.) I wish emphatically to dwell upon this subject, because we are only upon the threshold of a war, and because I feel this that if any smill amount of inconvenience were to induce us to deviate from the course I have just presumed to state, we should not be acting worthily of ourselves and of our country. Sir, the reasons against resorting to the money market— the reasons against charging these expenses upon posterity, are too many and too great to allow us to follow that course. (Hear.) Ido not lay down laws for other coun tries. There is no country which has played so deeply at this dangerous game as England has done—(hear)—there is no country which has mortgaged the industry of future generations to so fearful an amount. (Hear, hear.) If I am told that there are conveniences, and no doubt there are 500 conveniences, in having Three per Cent. Stock, I into which men can buy and out of which they can sell, grant there are such, but I think you have ample scope for all these conveniences as long as you have 750,000,000 1 . of Consols. (Hear, hear.) Sir, as there are econ omicalrea sons, so there are moral reasons, both of which, trust, will induce this country, and induce this house, as long as it is possible to maintain the policy—the sound and honest policy—of raising the supplies necessary for the expendi ture of the year. (Hear, hear.) It may be very well for other States to act differently. It is not for us to lay clown rules for them. Take, for instance, the example of Arne ricr—America without debt—America with a standing surplus—nothing could be more unusual—nothing could be more intelligible than the way in Which, when s h e annexes portions of territory at the cost of a war, she raises a loan to defray the expenses of that war, because, according to every rational principle of calculation, she knows what she has to deal with. She does not enter into English politics and calculation. She reckons upon her expenditure exceeding her means for two or three years, but she knows that it will be overtaken by the standing surplus of her income above her expenditure ; and, con sequently, she avoids, and very wisely avoids, disturbing her sys t em of taxation with reference to the cost of such war . *(Hear.) Take, for instance, our great and powerful ne i g hbour, France. The debt o f F rance, although it is considerable, is not to be compared for a moment to the debt of England. Indeed, lam sorry to say, such is our sad pre-eminence in respect to public debt, that I believe we far exceed, not only any one country, but all the coun tries of the world put together, in the amount of our debt. (Hear, hear.) Any man who has had to do with the administration of the finances of the country, must feel how many there are—how many grievous bur dens you are compelled to keep upon the people, because of the demands of the enormous; almost over powering maw of our debt—how many good works you are obliged to defer —how you are obliged to narrow, and pare, and cut dow the assistance you are desirous of offering to civilised and honest pursuits, because of the immense and crushing weight of this great, prominent, and standing debt. (Hear, hear.) Sir, we should incur a great and serious responsibility were we voluntarily to add to the amount of that debt, and I am convinced that the com mittee is not prepared at the present time to make an ad dition to that burden, and I trust they will not be prepared at any time to take a course so fatal to the interests of the country, (Loud cheers.) Sir, the principle has been sup ported by political economists of the greatest reputation. These are the words of Mr. Mill :—" If capital taken in loans is abstracted from funds either engaged in production or destined to he employed in it, their diversion from that purpose is equivalent to taking the amount from the wages of the labouring classes." And no doubt, without at all endeavouring to entangle the house in abstract arguments of political economy, there is much truth in the allega tions of those who say that if you raise war supplies by new taxes, you make each man take his share for himself out of his income from his expenditure ; but if, on the contrary, you go into the marketfor a loan, you act directly and to the full extent upon that portion of capital which is immediately available for the promotion of trade. In the one case, you get a large porti in of what you want out of a man's comforts ; in the other case, you go directly to that fountain-head where money is supplied, upon which in a great degree the activity of trade and the cheapness of pro ductions must depend. But, sir, in a less scientific point of view, I beg the committee to listen to what Mr. M`Ctillocl says on this important subject in his work on texation. He discusses the immense waste that attends upon all borrowed expenditure, and inquires into the best mode of meeting that calamity. He says :—" There are no means whatever by which the profusion and waste occasioned by a war can be counteracted, except by the industry and economy of individuals ; and to make these virtues be practised, individuals should be made fully sensible of the influence of war expenditure over their own private fortunes. The radical defect of the borrow ing system consists in its deceiving the public on this point, and in its making no sudden encroachments on their comforts. Its approaches are gradual and almost unper ceived. It requires only small immediate sacrifices, but it never relinquishes what it has once gained, while the ne cessity for fresh sacrifices, arising from their own ambi tion, injustice, and folly, as well as from those of their neighbours, continues as great as ever. Such a system is essentially delusive and treacherous. It occasions the im position of tax after tax, hardly one of which is ever again repealed, so that before the public are awakened from their trance, and made aware of their actual condition, their property and industry are probably encumbered with a much larger permanent interest on account of the inte rest of the public debt than would have been required had they submitted t o it a t once, t o d efray the expenses of the war." Sir, I confess that that reason is perfectly satisfac tory, and that, irrespective of other considerations, it is perfectly true to say of the system of raising funds neces sary for wars by loans, that it practises wholesale syste matic continued deception upon the people—(hear)—that they don't really know what they are doing. (Hear.) What is desirable is that they should know the price they are called upon to pay for the benefits they expect, or the sacrifices they think fit to make in order that that which they do they may do on intelligent and reasonable grounds, not deluding themselves at the cost of a charge on pos terity. (Cheers.) Sir, I do not hesitate to say that it seems to me, that if the political reasons are strong for the adoption of that policy, not less strong are the moral rea sons. (Hear.) The expenses of a war are the moral check which it has pleased the Almighty to impose upon the am bition and the lust of conquest that are inherent in so many nations. (Hoar.) There is pomp and circumstance, there is glory and excitement about war, whi.di, notwithstanding the miseries it entails, invests it with charms in the eyes of the community, and tends to blind men to those evils to a fearful and dangerous degree. The necessity of meeting from year to year the expenditure which it entails is a sa lutary and a wholesome check, making them feel what they are about, and making them measure the cost of the bene fit upon which they may calculate. It is by these means that they may be led and brought to address themselves to a war policy as rational and intelligent beings, and may be induced to keep their eye well fixed both upon the neces sity of the war into which they enter awl their desire to realise the first and earliest prospects of an honourable peace. (Cheers.) Well, sir, having stated under their various heads what it is the Government cannot recom mend the committee to do, and what it is we feel convinced the committee will not do, there cannot, I think, be much doubt remaining on the mind of any man as to that—(hear, and :aug,hter)—as to that which the Government will pro pose, nor, I think, as to that to which the committee will agree. Sir, when in the month of April last, in discussing the subject of the income tax, I referred to th immense results which directly and indirectly it had achieved at that time—to the immense direct addition which it male to the resources of the exchequer, and' o the indirect and collateral effect which it seems to have had in invigorating the whole of our fin anc i a l sys t em — an d w h en I ventured tob state to the committee that this was the great engine which you must look to use in the event of European ne cessities, I had not a shade of serious apprehension as to the earliness of the period at which I was to call upon the committee to give) effect to those views. But it is true that you have here a mighty engine —an engine which you may use to an extent almost equal—l will not say almost equal, . but to an extent equal to a great part of what any war can demand, and an engine which is well equal, and more than equal to the issue to which we now propose to apply it. Sir, the estimated receipts from the income tax at the present rate for the next year I have taken at 6,275,0001. In that anus is included a small amount of arrears, properly belonging to the present year—p er h a p s from 100,0001. to 150,0001.—but which will not have been levied before the sth of April, and which we hope to overtake in the next year. The proposal which the Government will make has in view the repairing the deficiency upon the income, as compared with the expenditure, according to my estimate amounting to 2,840,0001., and likewise of providing that moderate margin which, upon the estimates, it is the wis dom as well as the pleasure of this house usually to provide. I propose, air, on the part of her Majesty's Government, that we should increase the income-tax by one-half, and should levy the whole addition . for and in respect of the first moiety of the year—in other words, that we should double the income-tax fo r h a lf a year. (Sensation.) Now, sir, it may be thought that our more obvious course of proceeding would have been to raise the rate of income tax by a smaller amount for the whole year. But I have stated to the committee that in the circumstances in which we now stand it is impossible fot us to form a reasonable estimate of what will be the total cost of the warlike ope rations, upon the scale on which they are now contemplated, in case of their being prolonged throughout the year. I wish the committee distinctly to understand that we can not guarantee that the funds for which we now ask will euffice to carry on the active operations of war during twelve months, and, therefore, not being able to look for ward to so long a period, we have thought it best to pro pose that the addition which it is now intended to make to the charge should be an addition to be levied off the income of the country, in respect only of the first portion of the Teas. The effect of that scheme will be as follows :—ln the first place, that it is the only measure by which it will be in our power t o ra i se t h e whole addition within the Tom- The comm it tee will please to bear in mind that the lev Y in g of direct taxation is always six or nine months in arretr of the pen'od to which the tax applies. When you enact Si). i n you have creased duty upon spirits, from the moment voted the duty the tax takes effect, and perhaps within a week or a fortnight, or a few weeks at any rate, the Proceeds are in the Exchequer. But when you ena c t an - use begins to b 3 increase of the income-tax, that in 6thaorfeable for a period, which period commences on the il,and there cannot be any m oney levied u n d er the authority of such a vote of yours until the quarter between the 10th of October and the sth of January. It is therefore only by laying the increase of the tax upon the first moiety of the year that we can pos levy it within the year. But, sir ot the l sibly reason. I have stated to you that we think it our dut on t y levy upon the space I have mentioned, and to leave the e question un prejudiced as to th e further augmentation of taxes, in case the war expenditure should unhappil y quire it. If, therefore, I were now t o re" propose to double the income tax for th whole year—to raise the rate of in come tax for the whole year — l must necessarildoeef two things, either of which would be highly us , objection a ble.very If the Government asked you to give lar ge i n . which other in crease of the income tax for the whole year, then we Sh ould ask for a legal authority to levy an amount of money it is possible we may never require. But if, on the band, we ask von to levy the income tax for the whole year, but to giVe us an amount only sufficient to cover the present deficiency, then we should be in the difficulty that we might very probably be compelled to come to you agai n , and ask you again to alter the vote of the income tax in respect of the first moiety of the year, which you have already altered once. Therefore, sir, the course which I recommend is much the simplest course ; it is a course which will give the fullest effect to the principle of levying the tax within the year, and will at the seine time roost fully preserve the control of the House of Commons, that the proposal which I make should take the form which I have given it, namely, the form of doubling the income tax for the half-year. The form of the enactment would be very simple—that the rate of income tax (I am not using the the technical language of the resolution), come tax granted by the orit of act that the rate of - " 1 be raised from Td. to auth 10Ad. in the the poun of last d, and thatsesawn the whole of th e mo i e t y so added:to the tax shall be b 0 leviable in respect of the year in the first half-year. (Hear.) Sir, I will now state the effect of that proposed addition to the income tax. As I have before stated, irrespective of any change in the law, the income tax from April, 1854, to April, 1855, would yield the sum of 6,275,0001. The moiety of that sum of 6,275,0001. would be 3,137,5001. But, then, in the case of the income tax, the expenses of colle lion vary inversely as in the case of indirect taxes. In the case of the in , come tax, if you increase the tax you diminish the percent age of the cost of collection. The sources of supply are not dimished ; the assessments are the same; the taxpayers are the same. Some part of the expenses of raising the tax being defrayed by percentage, there would be a certain augmentation in those expenses ; but, upon the whole, the effect is, that by adding a moiety to the tax you add some what more than a moiety to the amount actually raised. The proceeds of the tax ; as I have taken it, would amount ' to 3,307,0001. If you add that sum to the 6,275,0001. which I have already estimated as the proceeds of the tax under present mode, you will find that it gives for the whole pro duce of the tax, from April, 1854, to April, 1855, the sum of 9,582,0001. Now, sir, it is a very simple matter to rectify the general balance of income and expenditure. As I • stated before, the income for the year 1854-55 I estimated at 53,349,0001. I now propose to augment that income by an addition to the income tax which will yield 3,307,000/., so that the total income of the country, if it should please the committee and the house to adopt that proposal, will be 56,656,000/. The expenditure on the other hand, as estimated, stands at 56,189,0001. So that there will be, by way of provision for the services f the year, a sum amounting to the whole estimated expenditure, and like wise a small surplus of 467,0001. (Cheers.) Sir, I have stated to the committee that the Government are not of opinion that it would be compatible with their duty to propose, under the present circumstances of the country, to surrender or sensibly to imdair any branch of the revenue. (Cheers.) There are various subjects that have been dis cussed, and in which portions of the public or the entire public may feel a deep interest, and some of which it would have been my pleasure and satisfaction to have submitted to this committee, had the circumstances of the country per mitted me to take such a course. But, as matters now stand, we feel it our duty to hold by the revenue as it at present exists. (Cheers.) Butthere is one change which is a mat ter of interest to the commercial community, and to which it is right that I should advert, because it is a change which while it may afford upon the whole, I trust not an incon siderable relief to those, or some of those, whom it affects, yet it will not, I think, be attended with loss to the Ex chequer. I refer to the case of stamps which are charge. able upon bills of exchange. (Hear, hear.) I need not detail to the•committee the state of the law with regard to that very important subject. It has been placed clearly before the public in consequence of one or more cases which have recently been brought before the courts. Suffice it to say that it is most unsatisfactory, and demands the adop tion of some altered provision. At present, for whatever reason, we have thought fit to charge bills of exchange drawn at home with a stamp duty, and to exempt all bills which are drawn abroad. Although they come into this country—alth)ugh they are negotiated in this country— although they act as instruments of credit and circulate in this country—yet they circulate free of stamp duty. This is not the policy of all other States. France has aoplied— and, so far as I can discern, has rationally applied—a uni form system of stamp to all bills of exchange, whether they are home drawn or whether they are foreign drawn. But this is not by any means an abstract question. As the matter now stands, we have reason to believe that the law is evaded, and that the Exchequer is defrauded by dishonest persons, who, when drawing bills at home for purely do mestic purposes, take those bills abroad, and thereby escape the stamp duty. (Hear, hear.) But the evil that is sus , twined by the Exchequer is a very small part of the mis chief. The serious part of it is this—that those bills get into circulation—that they are discounted by one person and another, and thus pass from hand to hand. They come into circulation with foreign ("aims and foreign places printed upon them, and get into the hands of persons who caunot,pos sibly know anything of their origin, and these persons, if they have occasion to sue the acceptor of such bills, nd that in law the security is good for nothing. It is impos sible to leave the law in such a state as that without seri ously impairing the tone of credit in the great mercantile circles of the country. There is another reason why it is most desirable to alter this law, and that is the extreme inequality and the extreme impolicy of the present stamp duties on bills of exchange. The law is constructed upon the principle of laying upon small bills of exchange an al most prohibitory amount of duty, whilst upon bills of large amounts it lays a duty that is scarcely sensible at all ; so that, while persons who deal with large sums of money scarcely feel the bill stamp, the person who uses capital in very small amounts is almost entirely precluded from the use of this convenient machinery for credit. A. bill of the amount of less than 201.—a bill of between 51. and 201.—is liable to pay a stamp duty of is. Gd., and, supposing it to be a bill for 121.105., and its duration to be for two months, that amounts to the ra t e o f 12 s. per cent. for tho two month's, or 31. 12s. 6d. per cent. per annum. The effect of the bill stamp upon bills of that amount is about double the rate of interest that a person must pay for the money. If he pays at the rate of 3'. 12s. 6d. for the stamp, and 3or 4 per cent. for the money, he is using money that costs him 6or 7 per cent. (Hear, hear.) As you move upwards the burden becomes less, but it is a serious burden ; it is a burden of more than 1 per cent. per annum until you pass bills of 1001. each. That is hardly reconcileable with jus tice to those whose credit may be perfectly good, whose business may be as sound as that of the wealthiest house in London, and as prudently conducted as that of any banker or capitalist in the country, yet who feel them selves precluded from availing themselves of those most valuable resources. I propose, therefore, to adopt an ad valorem scale in lieu of the present scale, at the rate of 3d. for each 251. or is. for each 1001. upon short bills, and 4d. for 251., or ls. 4d. for 1001. upon long bills. I propose to carry that scale with varying intervals (the whole detail of which will be laid before the committee in a s h or t resolu- tion in a few days) upwards to 5,0001. Ido not know that it would be worth while to carry it further. I propose to abolish altogether the distinction which now exists between home drawn and foreign drawn bills, and to make them bear precisely the same rate of stamp. I propose for the convenience of the community—and a very great conveni ence I believe it will be—not to adopt the system which is in force in some foreign countries of impressing stamps, the effect of which is that the holder of the bil., before he can use it, is obliged to carry it to a public office, where he must have it stamped. Instead of taking him to the public office, I propose to take the public office to him, by permitting, and, indeed, requiring him to use that very simple invention of adhesive stamps which people will keep by them, so that there will be uo obstruction what- ever to the course of trade from the adoption of this sys tem. (Hear.) A very important point with regard to the convenience of the large class whom this proposition will affect is, that the time which is occupied in the prepara tion of the dies for these purposes is always considerable, more especially as it is no, within the comp Once of the revenue department, with whom the matter rests, to make these dies until it can be done under full legal authority. Every exertion will be made to expedite the process, but I do not expect that the proposed change of the law with re spect to the stamps upon bills of exchange will take effect until the sth of July of the present year. If it can be effected at an earlier date, with such notice to the parties as can make it convenient, it shall be; but, as I am at present advised, lam doubtful whether it can be accom plished previous to the date which I have mentioned. I will just briefly state how this will affect this branch of the revenue. The revenue for the year ending April 5, 1853, from stamps upon bills of exchange, was 555,00 i/. As nearly as we can tell, the average rate of the present duty, although it is most unequallfdisposed, is ls. 61 per cent. We propos,: to equalise it at the rate of ls. The general effect of this change will be to lower the rate of duty upon all bills of exchange for less than 1001., and to raise it somewhat upon amounts above 1001. Estimating then, the future income at the rate of Is. instead of Is. 61 per cent., that 1 gives a revenue of 434,0001. But, ne doubt the effect of this law, as it will make the system ap plicable to small amounts of money to which it has hitherto been almost entirely inapplicable, will be to brine a good deal of capital i n t o ac ti on i n thi s f orm which has 'hitherto lain dormant. I therefore anticipate a considerable addi tion to the revenue from the use of a larger nue-ber of stamps upon bills of exchange for small amounts. From that source I estimate an increase of 60,0001.; and I allow also 50,0001. for the proceeds of the stamp upon foreign bills of exchange. Those sums added togeth er w ill g i ve a total revenue of 514,000/ , which, with the trifling excep tion of 11,0001., will be equal to the revenue at present de rived from that source. (Hear.) Now, there is only one other subject on which it is necessary for me to trouble the committee, and it is one which does not require me, fortunately, to trouble theni at anylength. I shall lay upon the table to-night a resolution having reference to the in come tax, and intended to give effect to the proposal which I have stated • but I have also given notice upon the votes that I intended to ask the House of Commons to night for is vote of 1,750,0001. of Exchequer-bills. That vote will require from me a few words of explanation. The com mittee are aware that the balances in the Exchequer are low at the present moment. I must confess that I do not think that that is an unfortunate circumstance, taken in conjunction with the occurrences that are going on and the demands that are made upon us. (Hear.) lam afraid, if there had been 4,000,0001. or 5,000,0001. in the Exche quer over and above what was required for the public ser vice, that there might have been a strong temptation to say, "We will raise money by taxes for the war expendi ture when it is wanted ; but here are these balances lying perfectly idle, let us apply them in the first place." Whe ther that temptation would have been a strong one or a ' weak one, it has b een remove d ( a laugh) • and at present the balances are i n suc h a condition that although we could have gone on perfectly well, supposing that no ex traordinary demands had been made upon us for military expenditure, yet, in consequence of them, they would re quire somewhat to be replenished. I stated to the com mittee that I should ask for an addition to the income of the country amply sufficient to cover the deficiency which I have estimated ; but I also stated that we should not realise any part of that addition to the revenue - until to wards Christmas, while, upon the other hand, a large por tion of the expenditure which we have to provide must be met in the first or in the following quarter. I have, therefore, thought it prudent, and I believe the committee will have little doubt that it is prudent, to ask for power, to be exercised in case of need, to make a moderate issue of Exchequer bills. At the same time it is very im portant to remove all misapprehension upon this subject, because there is a natural jealousy of additions to the unfunded debt, and I must confess that, were it compa tible with other matters, I should have thought it a great object of sound financial policy to have effected a reduc tion in that debt. (Hear, hear.) I and, therefore, parti cularly desirous that the committee should understand when authority has been given for raising the 1,750,0001. by Exchequer-bills, which I have now asked for, that it is an authority which will only be exercised to such an extent as may be found convenient to the public service. I do not expect that it will be necessary to exercise it to the full extent, though I think it probable that it will be neces sary to exercise it in part. But if it should be exercised to the full extent, and if every farthing which I am now asking for authority to issue, shoull be issued in conse quence, I wish the committee to understand that the un funded debt, after the fall exercise of that authority, will only stand at the point at which it stood twelve months ago. (Hear, hear.) At that period the unfunded debt amounted in round numbers to 17,740,0001. At the present moment it is in round numbers 16,000,0001., large pur chases of Exchequer-bills having been effected from va rious sources, chiefly by.the National Debt Commissioners, during the last year, and the sum of 400,010/. having been exchanged for permanent Exchequer-bonds. That being so, ',simply propose to take power to All up the margin which I have already created, and I will make, in no case, any addition, except perhaps to the extent of 10,000/ or 20,000/. to the amount of the unfunded debt, in conse quence of the measure which I now propose. I do not think, sir, that the committee have any reason to be dis satisfied with the state of the public credit, as indicated by tho condition of the unfunded debt. It is quite true that it has been found necessary to make a great increase in the rate of interest upon Exchequer-bills. (Hear.) The rate of intere s t upon Exchequer-bills is at present two pence a-day, or in round numbers 3 per cent- p er annun2 ' • Thiti time lazt year, or a liter than that; it was only one peony a-day, or I,i per cent. per annum, It has been doubled in the interval, owing to the great pressure in the money-market ; but that has not been con fined to this country, the very same thing having taken place in France. In that country the short-dated Bons de Tre,sor, which correspond to our Exchequer-bills,'which were then 1i per cent.,cent., are now 3 per and the long-dat e d, which were then 3 per cent., are now 5i per cent. These Exchequer-bills, which I am now asking the committee to authorise the Government to issue, are in reality what the other Exchequer-bills falsely purport to be—that is to say, they are supply Exchequer-bills. The mass of unfunded debt still passes by the name of "Supply Exchequer-bills," though it has ceased practically to have any relation to supply at all, and in fact constitutes a debt which is per manent in itself, but the obligation of which is renewable from year to year. When you confer, under the regular sessional act, authority to raise so many millions by Ex chequer-bills, you do it with the view of replacing them as they become due by other Exchequer-bills. But these are Exchequer-bills of quite a different class. These are to be raised simply in anticipation of supplies, for which you will have given authority, and when the supplies come in these Exchequer-bills will be paid off out of those supplies so realised, and no more will be heard of them. (Hear.) That is the case with respect to the Exchequer-bills; but they are connected with a subject to which I adverted at the commencement of my remarks, and upon which some infor mation is due from me to the committee—l mean that the committee ought to know the position of the public finances with relation to the abortive operations (for they were abortive in reference to the main purpose for which they were undertaken) which were attempted last year upon the debt and public balances. The committee are aware that the commutation of stocks which it was proposed to effect succeeded only to an insignificant extent, the whole amount of the new securities created being about 3,500,0001. in con sequence of the commutation. Of the minor stocks, which were to be compulsorily paid off unless commuted under the act of last session, 8,000,0001. have been or will be presented for payment ; and the public balances, which, as I said, are now low, whereas 12 months ago they were high, have been employed in paying off those minor stocks, and will be em ployed in paying off what remains to be liquidated of them upon the sth of April, together with supplying what is necessary for a very useful operation—namely, the liquida tion of a debt which had been charged some time before upon the land revenues of the Crown. It is not possible for me to give to the committee a precise and accurate state ment of the cost or saving connected with these operations. I can give you the saving, but I cannot precisely give you the set-offs against that saving. The saving stands as fol lows : Annual diminution of charge by stocks paid off in January, 1851 £186,000 Ditto, by stock to be paid off in April next Ditto, by liquidation of debt charged upon the Land Revenues 27,000 Minor charges extinguished 9,000 63,000 Total saving £285,000 But then, in consequence of the large drain upon the pub lic balances, it has been necessary to apply as a sinking fund money, otherwise available to the purchase of stock, to a considerable extent towards the redemption of the de ficiency. 2,300,000/. has already been applied in that manner, and a further sum will be so applied. As a set off, therefore, against the saving which I have shown, I take the saving which would have been effected by apply ing the sinking fund to the purchase of stock, up to the sth of April, 1854. It is difficult for me to say to what that saving would have amounted ; but, as far as the appli cation of those surpluses has at present gone, or can now he foreseen, it would amount to about 102,000/. I think it is possible that it may be necessary to make a further similar application to the extent of from 1,500,0001. to 00,000/. ; and, if so, I ought to acid 50,0001. to the 100,0001. as a set-off against the saving by the extinction of stocks. If, therefore, I take it at 152,0001., that will leave a total net and permanent saving, in consequence of the employment of the public balances, under the act of last year, of 133,000/. per annum. (Hear.) I stated last year, that however unfavourable the circumstances might be, the process could not leave less profit than a permanent saving of 100,0001, As far as lam able to correct the esti mate to• the present time, I should place it at about 130,0301. The proposals which I have made, involving some considerations of policy, and requiring a, good deal of reference to details, have led me into a statement of considerable length, but the committee will at once apprehend that it is capable of being summed up in a very few words. The amount, in effect, to these two propositions ; setting aside the collateral subject of bill stamp, and such other subjects, which are, however, of great importance to various classes—suchfor example as the question with respect to the rofining of sugar, upon which I propose to declare the intentions of Government upon some day after Easter—setting aside those secondary and collateral points, I propose simply that you should in the first place, agree to double the first half-yearly payment of the income-tax in respect of the year 1854-55, and that you should make provision for the interval which must elapse, before the tax can be absolutely levied, by the issue of Exchequer-bills, .v hich issue of Exchequer-bills is to be within the amount of 1,750,0001., and which Exchequer bills, if istued, will be paid off out of the growing produce of the revenue. Sir, we have sought in these propositions to discharge the obligations which, as we thought attached to us as a Government. We have sought to make a com petent provision for the immediate exigencies of the coun try, and for carrying on the operations which are in pros pect with vigour. We have sought, also, to leave to the House of Commons the fullest possible control over the public expenditure ; and we have placed ourselves in such a position, that if the operations of war should be pro longed, it will be necessary ferns again to come to you and ask you further to enlarge the resources of the Exchequer. Sir, if that necessity shall aris e , we shall again appear before you with the same confidence with which we now make our demands ; and we are satisfied that it will be the . . opinion of Parliament that, in thus proposing a measure which is adequate for the needs whichhave been made the subject of reasonable calculation, and inleaving to a future period of the session any recurrence to you that may be re quisite for further needs then emerging, we have taken the course which is most in accordance with our own position and duties as the Ministers of a - constitutional country, which is most for the interests of the people of this country and which, we are satisfied, will not tend to any forfeiture of the confidence or approval of the House of Commons. I propose to move at present the resolution with respect to the Exchequer-bills; and, with respect to the income tax resolution, I propose that the Committee of sVays and Means should meet again on Monday next. (Cheers.) The resolution that 1,750,0101. Exchequer-bills be voted having been read by the CHAIRMAN, Mr. BALL was understood to ask whether the proposal with respect to the income tax would not operate Very un• fairly in the case of a person whose income might be larger at the beginning of the year, when the tax would be high, than at the close of the year, when it would be low? The CHANCELLOR of the EXCHEQUER said he was not sure whether the hon. member was precisely aware of the manner in which the income tax-was levied. Where there was an assessment every assessment was annual, but the levy was in two moieties- The assessment remained precisely as it was, and it would be levied upon precisel; the same basis as at present • but it would be 10j(1. upon the year instead of 7(1. and ft would be 7d. upon the fi rs t half-year instead of 331 i. The 104(1. would not be paid i n two moieties of 54d., but there would be one payment of 7d., and another of 31d. Mr. HUME expressed his general satisfaction at the statement which had been made by the Chancellor of the Exchequer, which should operate as a great encouragement to those who had advocated the reduction of indirect taxa tion. When he heard the right hon. gentleman refer to Mills, he had hoped that ho was going to propose that all real property, down to the lowest amount, should be rated and charged to the income tax, and that incomes from other sources, down to as low as 501. or 601. a year, slimed be brought within the scope of the tax. With regard to the war iu which this country was about to engage, he ob served that, before it had been possible for the house to consider the expenses and evils of such a war, numerous resolutions were passed by the mass of the community and by corporate bodies, calling upon Government to go to war. Those who had been so ready and willing to urge the pro secution of war should now be called upon to bear a por tion of the expenses, many of them being at present ex empt. Adverting to the insurance duty, he stated that the property at present insured throughout the country did not amount to a third of that which would be insured were the duty taken off or materially reduced. He had hoped that the duty would have been so lowered as to have enabled the mechanic to insure his tools against loss from fire. The present charge for effectiug an insurance was ls. 6d., which together with a Crown duty of 35., was much more than "the working man could afford to pay. Without touching upon the question of the reduction of the paper any other duties, he most strongly urged the necessity for the modification of the insurance duty. Sir H. WILLOUGHBY was desirous of asking the Chancellor of the Exchequer whether the national debt had been increased from the sth of January, 1853, to the sth of January, 1854, and whether any new Three per Cent. Stock had been created ? The question was not an idle one, because a paper now upon the table of the house showed that fresh stock to the amount of 383,0001. had been created in the month of May, and during the autumn of last year. It appeared that the commissioners for re ducing the national debt had authorised a sum of money belonging to the savings banks, and amounting to 1,200,001., to be invested in the Exchequer Bills at a time when the right hon. gentleman (the Chancellor of the Exchequer) had most unwisely, as he (Sir. H. Willoughby) thought, reduced the interest. A clause in an act of Par liament passed in the reign of William IV., gave power to the commissioners for reducing the national debt to con vert money from Exchequer Bills into stock, and vice versa; and, if it were true that in the year 1853, 1,274,0001. of Three per Cant. Stock had been created, he could not see the use of granting any more Exchequer Bills. He con curred in the remarks of the Chancellor of the Exchequer with reference to the sad pre-eminence of this country in debt ; but he professed that he did not understand why a debt should be created without the knowledge of the house. If our debt was to be increased, it should be in creased directly, and not by indirect mea He had thought that the ri g ht h on . gen tleman the me . ; .er for the University of Cambridge (Mr. Goulburn), who had been Chancellor of the Exchequer in a former year, had put an end to the system of which he (Sir H. Willoughby) now complained, and he remembered that, at the time he re ferred to, the right hon. gentleman (Mr. Goulburn) pointed out the immense evils that resulted to the savings banks from the adoption of the system. (Hear, hear.) Mr. W.WILLIAMSgave the Chancellor of the Exchequer ' every credit for the means he had suggested for raising the necessary surplus for carrying on the impending war, and remarked that the course pursued by the right hon. gentle man was much different to that pursued by Mr. Pitt at the commencement of the last war. In the latter case the levy ing of taxes for the purpose of carrying on the war wee postponed for between four and five years, and the conse quence was that between 100,000,000 1 . and 200,000,0001. were added to the national debt which the peaple of the present (lay and their posterity had to pay. In.the year 1797, before the war taxes were laid on, 34,000,0001. were borrowed, though only 17,000,0001. were actually received. He (Mr. Williams) should not have risen to address the house now, had not the right hon. gentleman (the Chan cellor of the Exchequer) in a very pointed manner referred to an estimate ho (Mr. Williams) had submitted to the house last session, in bringing forward a motion to extend the probate and legacy duty to real property. The esti mate of the right hon. gentleman far exceeded that which he (Mr. Williams) had laid before the house. The CHANCELLOR of th 3 EXCHEQUER was under stood to state that he had not referred to the hon. member for Lambeth. Mr. WILLIAMS said, the right hon. gentleman had promised last session to extend the legacy duty to tithes, and he (Mr. Williams) expected that proposition .would have been carried into effect now. He had also understood the right hon. gentleman to propose to extend 114nolrobate duty to 'real property ; and, had those two pogift - - been brought forward now as a part of the budget, he believed nearly all the increase proposed in the income tax might have been dispensed with. In the absence, however, of extended legacy and probate duties, he highly approved the course pursued-by the right hon. gentleman in raising, the addition required n the revenue by an irlOreaee Of the TAZ, SUN, LONDON, TUESDAY EVENING, MARCH 7, 1854. income tax, instead of interfering with the reductions made upon important articles of consumption in the budget of last year. (Hear, hear.) Mr. HENLEY observed that when the late Sir R. Peel took the management of the finances of the country into his hands in 1811, if there was one point won which he laid greater stress than another it was that Government should keep a balance in the Exchequer to render them not only independent of circumstances, but independent of the Bank of England. (Cheers from the Opposition.) The effect of recent non-compliance with, that policy was shown in the pro position now made to inflict a double tax upon the people for half a year. Last year the right hon, gentleman (the Chancellor of the Exchequer) complained of being so over whelmed by the money he had in the Exchequer that he ' found it necessary to get rid of it by some extraordinary moans. It had been got rid of, and the consequence was a pro posal was now made to vote Exchequer-bills to the amount of 1,750,000/. Ho (Mr. Henley) agreed with the late Sir R. Peel in the necessity of keeping Government indepen dent of the Bank of England, and of always having an available balance ;in the Exchequer. With regard to the general question before the house, the right hon. the Chancellor of the Exchequer had laid down this proposi tion—that in a time of war, the generation by whom it was prosecuted should feel the pressure caused by it ; but the right hon. gentleman had not altogether adhered to that pioposition, inasmuch as he made the burden of car rying on the war fall upon a limited number of the people of this kingdom. (Hear, hear.) By the propositions of the right hon. gentleman, many of those who had been most clamorous for war would not be the parties upon whom the expense of prosecuting it would fall, and there fore the policy of the right hon. gentleman was entirely at variance with the proposition he had endeavoured to lay down. (Hear.) Mr. GLYN observed that this country was about to en gage in a great, and perhaps a protracted contest, in which the operation of the late Sir R. Peel's Banking Act of 1844 would be more felt than it had been hitherto. He con fessed for one that he did not look upon that act with feelings of security, and he could not help thinking that' its restrictions upon the general commercial operations of the country, accompanied as they would be by a continu ous strain upon the resources of the country, would be a state of things that would be severely felt. He desired to call the attention of the Chancellor of the Exchequer to the fact that, by the act in question the issue of the coun try was placed at a particular amount. By the altera tions made in private banks a considerable reduction had taken place in the amount of their fixed issues, and he could not see why the Government should not avail itself of the opportunity of replacing the 700,0001. in question by the machinery at its command, and by its connection with the Bank of England. (Hear, hear.) Mr. VANCE was afraid the Chancellor of the Exchequer fell upon a class of holders of bills of exchange who ought not to pay an increased rate of stamp duty. The drawer of 'a bill of exchange generally derived the profit of the trans action, the parties among whom it circulated generally having a small commission or some small interest in the matter. Upon inland bills the drawer paid the stamp, and the bill circulated freely without charge, except a small charge upon transfer. But, suppose a hill from our North Atnerican colonies came to an agent here to be placed to the credit of a merchant, that merchant or agent who so opened, it was without reason forced to go to the Stamp, office and get a stamp affixed to it, while the original drawer was exempted from the taxation. He thought it unfair to place the tax upon one class of holders only. He also objected to the right hon. gentleman's ad valorem duty on bills of exchange. The drawer of a small bill usually derived the profit of the transaction, but the brok , r who drew a large bill of exchange, say for sugar, perhaps only got per cent. commission. He thought the commercial world would be dissatisfied that taxation should thus be placed upon the transfer of commodities in the gross. Mr. MALINS concurred with the Chancellor of the Ex chequer in thinking that the wiseand prudent course would be to pay our way as we waist, rather than raise money on loans wherewith to carry on the war. The Chancellor of the Exchequer proposed to raise the income tax from 7d. to lOid. for a year, of which amount he proposed to raise 7d. in the first half-year, and 3id. in the second half-year. Now, he should concur in the policy of this course, if it affected himself alone, or persons who were ready to meet that increased payment. But, when the right hon. gentleman considered the difficulty that many persons had to meet direct taxation, and how abhorrent the sight of the taxgatherer was to those who had not ready money, he thought they would complain that they should be called upon to pay the whole increase in the first half-year. Why should not the Chancellor of the Exchequer divide the payment into two equal s ums, and levy hit in the first half year, and 54d. in the second half-year. (Hear.) It would make the burden much easier to those who paid income tax, and it would make no difference to the Government, because they were obliged to borrow the money. and rather than distress those upon whom the burden would be thrown, it would be wiser to relieve them in the manner ho had pointed out. (Hear.) The Government had only to take power to raise more Ex chequer bills, and they would thereby very much lighten the burden upon the tax-payers. The Government would do well to consider, now that we were upon the eve of a great war, whether a great war could be carried on with a restricted currency. (Hear.) The Chancellor of the Ex chequer must remember what took place in October, '47, when wide-spread bankruptcy and financial ruin were only averted by the repeal of the act of 1844. Hon. members on his (the Opposition) side were prepared to give that support which the Government required for carrying on the war, upon condition that the war should be prosecuted with vigour, since that was the only means by which it could be speedily brought to a close. (Hear.) Mr. W. BROWN was of opinion that Sir R. Peel's act of 1844 was a serious loss and inconvenience to the country. When the Government determined to give a large discre tionary power to the Bank' of England in October, 1817, many houses were upon the verge of bankruptcy, and trade was paralysed. The 7,000,000/. or 8,00 ),000/. then locked up in the Bank of England on deposit might as well have been thrown into circulation. . If war broke out it would be necessary to take off those fetters from trade. He must express his dislike and disapprobation of a bill so injurious to the best interest of the country as that of 1844 had been. (Hear.) Mr. HAMILTON gathered from the papers that there had been some departure from the usual practice with re gard to the purchase of Exchequer bills on account of savings banks. It appeared that for more than a year pre vious tit the sth of May, 1853, purchases of Exchequer bills had been made by the Commissioner for the Reduction of the National Debt, and no purchases had been made of stock. Now, the practice had been when the Coininis sioners for the Reduction of the National Debt made pur chases of Exchequer bills, for them to be cancelled, and a certain amount of stock to be created. He wished to ask whether those Exchequer bills had been cancelled, and were now in the hands of the commissioners, and if that hail led to an increase in the national debt ? The CHANCELLOR of the EXCHEQUER—The lion. member for Lambeth had referred to a promise that he (the Chancellor of the Exchequer) was said to have made last session, that he would apply the succession-tax to tithes, and the probate duty to land. Now he was not conscious of having given such a promise. The Government had come to the conclusion that the old succession-tax was still applicable to tithes. The amount was not verylarge, and it would be better to introduce this subject when he brought in a bill, which he intended to do this session, for applying the succession-tax to corporations. With respect also to applying the probate duty to land, he was not con scious of having given a pledge on this subject either. He was quite satisfied with the changes made last year, which he was convinced were beneficial. (Hear.) The state of the finances did not allow him to operate upon the probate duty at all, but, if he had operated upon it, he had not been authorised by the Government to give, nor had he ever given any pledge to apply the probate duty to land The right lion. member for Oxfordshire (Mr. Henley) said that he (the Chancellor of the Exchequer) appeared to have held opinions contrary to those of Sir R. Peel with respect to the state of the public finances. Bit Sir R. Peel stated that doctrine at a time when the deficiency bills had run up to between 8,000,0001 and 9,000,0001. But when they had not reached an inconvenient height, and were only 2,000,0001. or 3,000,0001., the circumstances were very different. With respect to trade and circulation and pub lic economy, the really wise course with regard to public balances and deficiency bills was a middle course. It would not be wise to gq on inerdasing deficiency bills to an inde finite amount, er, to such an amount as 8,000,0001. or 9,000,0001., but, as long as they'did not exceed 2,000,000 1 . or 3,000,001., no inconvenience was caused. Hon. mem bers were mistaken if they supposed that a high state of public credit was indicated by the balances iu question. They had something to do with it, but the true test was the state of the inmate and expenditure. Let there be a surplus of income over expenditure, and he would answer for it the state of public credit would not bo bad. If the present state of public credit were tested by the price of stocks, it could not be considered otherwise than satisfac tory that our Three per Cents. were at 91 when we seemed about to enter upon a European war. (Hear, hear.) The hon. member for Kendal (Mr. Glyn) had alluded to the decrease of their issues by private banks, and the ex tinction of a portion of their circulation. Other members had entered upon a larger field, and appeared to threaten the house with a discussion of the act of 1844. Now, it was rather early-to begin such a discussion when the exi gencies of war had not yet commenced. The Emperor of Russia had already set hon. gentlemen and example of re moving tho fetters off the currency—(a laugh)—but he trusted the Government of this country would not man age matters exactly in that way. (Hear, hear.) With regard to the issues of private banks, hon. gentlemen should remember .that Government could not move in that matter without the concurrence of the Bank of Eng land, and that the Government had not been in 'a position since - their private issues had been extended to make it fcr the interest of that corporation to give that concurrence. But circumstances might arise which would ere long make the proposition of the hon. gentleman (Mr. Glyn) a most useful measure. He was not disposed to differ from the hon. member for Dublin (Mr. Vance) in what he said re lative to foreign bills of exchange, but when the hon. gentleman saw his resolution upon the table, which he hoped would be in the course of two or three days, he would find that it was not obnoxious to the objections he 'had urged. He could assure the lion. and learned mem ber for Wallingford (Mr. Malins) that it was not owing to the low state of the public ba'ances that the Government proposed to levy the addition to the income tax in the first half year. The state of the public balances had never entered his mind in making that arrangement, The rea son why the Government asked for that increase in the first half-year was, that they might be able to make provision for the probable expenditure. The Go;irernment could not tell what the expenditure of the year would be, but he had stated to the house that if warlike operation were pro longed during the whole of the year, they must come again to Parliament for supplies. The Government were now making provision for the first six months of the year, and they therefore proposed to make provision to raise the money for those six months. That was the principle upon which they were acting, and it had nothing to do with the state of the public balances. If he understood the hon. member for Dublin University (Mr. H cmilton) aright he had inquired whether the forms prescribed by the act of Parliament had been gone through with regard to Ex chequer bills, and whether the stock had been created which by law ought to be created. Undoubtedly the whole of the proceedings in question were of a formal cha racter under the charge of the National Debt office, which took fffect invariably by an absolute provision of law. The power given to the Chancellor of the Exchequer was this —that he might, if ho pleased, apply the money in his hands to the reduction either of the funded on the unfunded debt. If he determined to reduce the unfunded debt, the Commissioners of the National Debt purchased the Ex chequer-bills, which they hold until they ran o ut, a nd the law provided that they should then be exchanged for per manent securities. The hon. gentleman (Sir H. Willoughby) asked whether the Government had not thereby added to the national debt ? [Sir H. T had funded debt.] The hon. gentleman was quite as competent to answer that question as himself. The Commissioners for the Reduction of the National Debt stood in this predica ment—that while they were the debtors of the trustees of savings -banks, they were the creditors of the nation. The commissioners had large same of money which they had to dispose of in investment's, When au ',mount of stook I was created and put to the credit of the Com m i ss i oners o f ! the National Debt, the dividends were payable to them, and they re-invested those dividends according to law, The hon. member for Evesham said that these accounts were extremely complicated, and he agreed with the hon. gentleman that it was very difficult to get any view of the working of the system. He (the Chancellor of the Ex chequer) should be very glad to simplify it ; but with re spect to the purchase of Exchequer-bills, it was his duty ' to advise the commissioners how to employ their money in a manner mcst conducive t ) the public interest. It was the duty of the Commissioners for the Reduction of the National Debt to employ the money in their hands in the most profitable manner with reference to the public in terest ; and, although it might be very true, as the hon. member for the University of Dublin had said, that it was not usual to employ the savings-banks' money in the way mentioned, the house would recollect that the circumstances of the present case were not of the usual kind. Ho was sure hon. gentlemen would follow him in his expl_anation of the position of the Chancellor of the Exchequer with reference to Ex chequer-bills. He had the power to raise the rate of interest to any amount during the currency of the bills, but if he raised the rate of interest, he must by law raise it for to whole of the remainder of the twelvemonth for which the bills ran. That was a very serious matter indeed, for the effect such a rise in the rate of interest of Exchequer-bills was to determine at once to spend 200,0001. of the public money. If he thought the state of the country was so bad as actually to require it, then it was his duty to raise the rate of interest ; but if, on the other hand, the circum stances of the country were of a doubtful and equivocal nature, or it was highly probably the pressure might pass away in the course of six months, and in a couple of months he might find himself at his ease, then it was his duty to be very careful how,he raised the rate of interest for the year; but still it might be his duty to make provi sion during that interval so as to prevent the holders of Exchequer-bills from being at the disadvantage of parting with their security at a discount, which would be a hard ship, and would not tend to advance public credit. He thought it right for a Chancellor of Exchequer to apply money in his hands for the purpose of relieving the Exche quer-bill market in times of pressure, but it ought now to be a matter of course to make use of the public money to buy up Exchequer-bills. Those were precisely the circum stances of the period to which the purchases in question referred. There was a bad state of weather, and the pros pects of the harvest`were gloomy, but at the same time not irremediable ; it might have happened that the weather might have changed in June and July, so as to have pro duced an abundant harvest. Political circumstances were in a state of entire uncertainty; one day they heard that there was every probability of a war, but the intelligence of the next was that the differences were goingto be composed, and such was the state of affairs, that at the close of the session Her Majesty 'was advised to address congratulatory remarks on the prospects of a speedy accommodation of the existing differences. If the threatening circumstances had passed away, and the harvest had been good, he thought it probable there would have been no necessity for raising the interest of Exchequer-bills at all, but still it was his duty to make provision for the extreme uncertainty of the times ; those purchases took place under those cir cumstances, and the Exchequer-bills were converted to stock according to law. The hon. baronet had made a complaint that the system was a complex one; in that he (the Chancellor of the Exchequer) entirely' , agreed, and should be glad to see it altered if possible. Mr. J. O'CONNELL begged to express a doubt whether it was altogether wise for a Finance Minister to make an other turn in the screw of the income tax on Ireland. He was net going to argue the justice or injustice of imposing that tax, although he might have done so had he been in the house at the time, for he considered it clearly provable that the imposition of that tax on Ireland was a breach of the articles of the union. He thought, although a certain amount was raised directly by the 'tax in Ireland, there was very little gained by it in the end, as it had a ten dency to decrease the general revenue, and they had yet to see by the estimate in April whether the general revenue of taxation in Ireland had not diminished. That country showed by the number of young men who were entering the services that she was prepared to do her share in de fending the country, and he was sure the same willingness would be evinced to bear her share of the expense— I (cheers)—but he doubted whether increasing direct taxa- I tion was the best way of effecting the object. They might ' have equalized the tax on spirits, which would have brought a large amount to the revenue. Ireland was quite ready to support the honour of the empire ; all she asked for was a little consideration. Sir H. WILLOUGHBY did not quite understand the explanation of the right bon. gentleman with reference to the employment of saving-banks' money. Was the money of the savings -banks to be made an engine of creating debt? He wished to ask the right hon. gentleman whether although by law there were Commissioners for the reduc tion of the National Debt, who were to sit—a certain num ber forming a quorum—and a record of whose proceedings was to be kept, in point of fact, that body did not consist of the right hon. gentleman alone A more dangerous system could not exist than that the Chancellor of the Ex chequer should by means of savings-banks, or in any other way, meddle with the national debt; it was clearly against the intention of the law, and it appeared to be a mode of creating debt which set at defiance all calculation. He was aware that system had been adopted in 1834, and he believed it was cap sble of proof that by the transfers which then took place the funds lost nearly 2,000,0001. It was supposed that practice was put an end to, but it was now revived. He hoped the right hon. gentleman would put the system with respect to the functions of the Com missioners for the reduction of the National. Debt upon some plain footing ; he did not care how it was so long as the responsibility was properly defined. (Hear.) Mr. HUME thought it ought to have been done openly. He rather thought the loss had been overstated ; but he kuevelthem was a loss, and they bad the assurance of the then Chancellor of the Exchequer that the practice should not be repeated. . Mr. W. WILLIAMS considered this was a very import ant question. In 1840 a large amount of these purchases had been made, and he then urged it on the house that no sum ought''to be added to 'the debt without authority for it. The Chancellor of the Exchequer of the day said he was not prepared to defend the principle of giving such a power, but still the power was vested in him by law, and he had exercised it as a way of making up the deficiency. Colonel SIBTHORT said, he protested entirely against the gross mismanagement of her Majesty's Government. (Laughter.) He had voted, and always should vote, against an income tax (luring the time of peace; but no one was more anxious than he was that the present war should be carried on in the beet possible manner, though he very :such doubted it would be by her Majesty's Go vernment. (A laugh.) He was of opinion that the country was ready to adopt any tax that might aid in a war which was to chastise our enemies. Sir F. BARING said, as allusion had been made to transactions in which he was engaged in 1841, he wistied to say a few words. There were two modes of proceeding in which they purchased the usual common' Ex chequer-bills of savings-banks' money and afterwards turned those Exchequer-bills, under the regulations of an act of Parliament, into funded debt. In .that case they made no increase of the public debt, but transferred from the unfunded debt, to the funded debt, which, in many cases, was extremely ad vantageous to the public, and he thought a justifiable transaction. It was a power that might be used with ad vantage by the Chancellor of the Exchequer, and he was quite certain that in many cases it was a very proper mode of proceeding ; for, having the moneys of the savings banks in their hands to invest either in the funded or unfunded debt, it was quite right to invest them in the way that would be most for the public service. There was another mode of dealing with them, quite of a different character, and that was, with those moneys to pay deficiency bills, and thus turn such bills into funded debt. That was what he did, and created a new debt, but he did not pretend to say it was a power which he thought was not open to ob jection, or which, if it were thought wise, might not be taken away from the Chancellor of the Exchequer; he defended it in regard to the necessity of the case, and thought it advisable under cer t a i n circumstances. lat he said was, do not, by attempting, to limit the Chancellor of the Exchequer's power to create new debt, take away from him the very proper power he possessed of .converting through means of savings -banks' money . unfundid into funded debt, which had been repeatedly done, and never without advantage to the public service. He was not quite sure, not having had the opportunity of examining the matter, but he believed the right hon. gentleman, the Chancellor of the Exchequer, had done what he was quite justified in doing. He durst say when the matter came to be th roughly discussed and explained the particular case and the grounds on which the hon. gentleman had proceeded would be given, for he quite admitted it never ought to be done without a clear explanation The CHANCELLOR of the EXCHEQUER—I am very anxious not to be misunderstood with respect to these transfers. None of them have relation to the investment of savings-banks' money in paying deficiency bills. At present I do hold some savings-banks' money in consoli dated funds, but that will not be made national debt. Sir F. BARING—That will be paid off? The CHANCELLOR of the EXCHEQUER—Yes. Mr. DISRAELI—Sir, I quite agree with the description which the right hon. gentleman the member for Portsmouth has given of the two modes of investing public funds in Exchequer bills, and I am very gl d that the right hon. Chancellor of the Exchequer has called the attention of the committee to the difference of investing savings -banks' money in deficiency bills and investing the proceeds of the revenue, as I think the last to be the legitimate practice, and one for which the highest precedents exist. With re gard to the general statement wo have heard to-night, whatever may be my opinion of the war in which we are about to engage —and certainly the importance of it has never been diminished by any discussion that has taken place in this house, or by any allusion that has been made to it by the members of her Majesty's Government—al though the conviction on my mind increases more and more every day, that it is a war that might have been avoided, still I believe it to be a just and necessary war under the circumstances in which we now find ourselves engaged ; anq I think we have only one duty to perform to our Sovereign, and that is to give her our hearty support in carrying on the struggle in which she is embarked. (Cheers,) For these reasons I make no opposition to any vote which a Minister of the Crown may, upon his own re sponsibility, think it his duty to propose, in order to carry on the war with vigour, and with the success it deserves, and which I hope it will receive. But, while I say that, I anticipate that this is not the only occasion on which a committee of ways and means will be applied to, for anxious as I am that the supplies of the ye f ar should come out of the revenue of the year, I must protest against the priuci ple that has been laid down that direct taxation, if there is to be a prolonged contest, is to be the only source from which to obtain supplies. (Cheers.) If the right hon. gen tleman, supposing this struggle to continue, can succeed in raising the necessary supplies from the revenue of the year, ho will be a fortunate and successful Minister; but I can not myself believe that it will be the fate of any one through a prolonged contest to accomplish such a purpose, and therefore I think that from the first the right hon. gentleman ought to anticipate that direct taxation will not be the only source through which the contest will be carried on by the country. (Hear, hear.) I do not say the limit of direct taxation has been reached, for we know very well that there have been wars in which this country has been eng Ted .when we had the property and income tax at a much higher rate than at present : nor am I pre pared to say that there is any probable limit at which the taxation of tho country can be fixed when it is engaged in a struggle in which its very existence as a nation is at stake. (Hear.) But ss e must remember there has been a very considerable addition to the direct taxation of this country of late years, and also a very groat diminution of indirect taxation. Every one' feels that the weight of direct taxation is now very considerable, and that it has recently been largely increased ; and every one on either side of the house will admit, to whatever party in politics, or whatever school of political economy ho may belong, that the diminution of the indirect taxation of this coun try during the last ten years has been such as to surprise the most sanguine votary of the direct school. The hon. member for Montrose complimented the right hon. gentle man on the clear and able statement he had made to-night. The right hon. gentleman is used to compliments for his aide statements, and no man more deserves them. (Hear, hear.) But lam bound to say, having listened with much interest and close attwation to all that fell from his lips, that, though I found one portion of his statement vex,' clear, there was another portion which appeared to me in volved in an obscurity which does not become financial statements at any time, and under such circumstances as are those under which the right hon. gentleman has made his statement to-night. (Hear.) So far as the right hon. gentleman's statement of the balance-sheet was concerned, nothing could be more perspicuous ; and, as to the remedy by which he is . prepared to supply the deficiency which may occur, nothing could be more plain. He gave as to our expenditure and our income an explanation in lan guage which no one could misconceive, and he de scribed the remedy by which the anticipated deficiency was to be supplied in a manner which no one could misapprehend. Objections may be taken, no doubt, and I reserve to myself the power, on another occa sion, to make them, as to the manner in which the increased income tax is to be raised. (Hear, hear.) But the state of the revenue, of the income and expenditure, and the means by which the deficiency of the increased expenditure is to be supplied, have been placed before the committee and the country in a manner which cannot be misunderstood. When, however, we come to . _ _ the second portion of the right hon. gentleman's state ment —that which relates to the actual state of our finan ces and the money in hand—we did not experience the same satisfaction, or, as it appeared to the, the same perspicuity. (Hear, hear.) The right hon. gentleman, in anticipation, probably, of objections, favoured the com mittee with, I will not call them itivect'ves, but un friendly criticisms on large balances in the public Exche quer.. There may, no doubt, be two opinions on the degree of treasure which we should have at command, but, being of that school which has been educated to believe that an ample and sufficient balance in the Exchequer is au im portant feature of finance.—(hear)—l feel it to be my duty to impress on the committee my conviction that the present state of oar balance is not sufficient, and may lead to danger. (Hear.) The committee, lam sure, will, on reflection, feel that this is not a point of indifference, even in ordinary times ; while in a time of exigency, in a time when the country may be suddenly called upon to make large unforeseen exertions, it is most unsound to encourage the idea in the Government that the finances of the coun try may be left in snch a condition that, in order to meet engagements from new circumstances, you must stretch that credit, which should at all times be treated with great delicacy and reserve. (Hear, hear.) When the late Government quitted office, on the 3d of January, 1853, immediately before our quitting office the balance in the Exchequer was nearly 9,000,0001. sterling. (Hear, hear.) One year after, at the commencement of this year, in January, 1854—exactly one year after we left office—the balance in the Exchequer was reduced one half. (Hear, hear.) The right hon. gentleman asks, " What of that ? If I employ the public money fur the advantage of the public, why do you criticise my conduct ? Why do you cavil at my policy ?" If the right hon. gentleman can show us that he has conducted with the necessary prudence his affairs—if he can prove that he has employed the public money for the public benefit—the question falls, and there is no doubt the right hon. gentleman will have a verdict in his favour, even from those who are, abstractedly, approvers of large balances. But I want to know what are your balances at the present moment, and what are the engage ments which the right hon. gentleman has to meet at the close of the financial year—on the sth of April next, one month from this time? (Hear, hear.) I think that is test ing the question fairly for the right hon. gentlemen. I can only estimate the amount of the balances in the Exchequer at the present moment by referring to the returns of the parallel period in the preceding year. According to the parallel period in the preceding year, allowing for the ex traordinary deductions from the balances which were occa sioned by the conversion of 6,000,0001. sterling, there ought to be now in the Exchequer—l mean, of course, on the sth of April—something like 3,000,000/. sterling. There is no reason why, on the sth of April next, the balance in the Exchequer should be more than 3,000,0001. sterling. Now, what will be the liabilities of the right hon. gentleman at that period ? He has, first, to pay the dividends then due, to meet the public credit. It is not in my power precisely to fix the amount so required, but it will certainly not be less than 6,000,000/., and it may exceed 7,000,0001.; let us take it at 6,500,0001. The right hon. gentleman has, at the same time, to complete the conversion scheme, or to meet its non-success, to the amount of not less than 2,000,0001. more, or, together, 8,500,000/. ; and he has, in the third place, to meet the current demands of the public service in its increased amount. Upon the whole, taking a mo derate estimate, I should say that the right hon. gentle. man will, on the sth of April, have to meet demands to something like the amount of 9,000,0001. or 10,000,0001. He has to meet this, it would appear, with a sum of 3,000,000/. Under such circumstances I want to know how he proposes to carry on the business of the country. (Hear.) The right hon. gentleman may say again—" What is the use of large balances ? I can borrow money, and will take the amount in deficiency bills, which will carry me on." The right hon. gentleman in the quarter which is now expiring, from anazary to April, has only been able to carry on his affairs by deficiency bills to the amount of 4,000,000 sterling. (Hear, hear.) The right hon, gentleman will perhaps tell us that 4,000,0001. sterling is not an immoderate amount of deficiency bills, and that it is better to carry on the affairs of the country by deficiency bills to that amount than by amassing the public treasure in the Exchequer. I will let that point pass. The right hon. gentleman says the amount of deficiency bills that Sir R. Peel complained of was more than 4,000,0001.—was 6,000,0001. or 8,000,0001. Will the amount of deficiency bills in the coming quarter that will be ne essary for the right hon. gentleman be less than 6,000,000/. ? (Hear, hear.) Is the committee of opinion that at any time the Chancellor of the Exchequer should have in any quarter 6,000,0001, of deficiency bills ; and is the country of opi nion that public affairs should be thus conducted at a mo ment when the Chancellor of the Exchequer comes down hero and tells us that it is impossible for him to make any precise statement of affairs because he is not prepared to meet any need that may be emerging ? (Hear, hear.) Sir, I say that there should be a balance in the Exchequer— (hear, hear) ; —but, instead of a question between proper and improper balances in the Exchequer, between ample balances and excessive balances, the question is now be tween a balance at all and a large deficiency. (Hear, hear.) In fact, at this moment, looking to the completion of the financial year, instead of a balance in the Exchequer you have an enormous deficiency. (Hear, hear.) Well, now, is that a state of affairs which is desi, able ? Is it desir able at any time? Above all, is it desirable in a time of war ? (Hear, hear.) These are questions which cannot be evaded. You may to-night say, "We have nothing to divide 'about ; let it pass;" but you may rely upon it, especially if those events occur which we now count upon, that you will find this weakness in your finance perplex all your movements, and destroy, perhaps, all the fine combinations of the Chancellor of the Exchequer. (Hear, hear.) Why should this state of things exist? Yon had, not so long ago, an ample balance in the Exchequer, in a time of peace, of commercial prosperity, of low prices ; you had an ample balance when on the eve, I will not say of disasters, but of contingencies that may involve disas ters. Why is this balance ' which we had in time of peace, not at your service now? That is what I want to know. Had you come *o this low state of the Treasury in the natural cause of natural events, and this position of diffi culty had befallen you, you might very fairly then have said, " We have to encounter these circumstances of diffi culty and danger ; help us to buckle to, and face them." But I said you had, when you entered office, this large surplus at your command, a surplus that would have met the exigency of the present moment ; this surplus does not exist. Why does it not exist ? All this has been omitted from the financial statement with which we have been fayoured by the right hon. gentleman. (Hear, hear.) That great balance has disappeared because the right hon. gen tleman about a year ago chose to take a course in monetary affairs which the circumstances of the times did not war rant, and which he pursued in opposition to the best au thorities that could possibly guide a man even as gifted as the present Chancellor of the Exchequer. (Hear.) Tho right hon. gentleman dealt with our resources in a manner which has ultimately deprived you of this command of capital in two ways. His great object was to reduce the rate of interest paid on the public securities, funded and unfunded. He began by dealing with the reduction of in terest on Exchequer-bills. I think it was on about the Bth of February, 1853, that the right hon. gentleman reduced the interest on Exchequer-bills to I t i per cent. For six weeks before the right hon. gentleman took that stop every indication which generally influences and should govern gentlemen in the position of the Chancellor of the Exche quer had intimated that the value of money was rising. I will not look at papers, because that would &cable the committee ; and if I make any mistake in my figures—in voluntarily, I am sure, for I desire to make no inistake--I shall, doubtless, be immediately corrected. The price of Consols when Lord Derby left office, about the end of December, was 104 • when Parliament met again, in February, Consols had been continuously declining, and they were then down to an Exchequer-bills, zwiti;, which when Lord Derby left office were from 69 to 72,' had fallen by February to 55-59. These were, I think, very significant symptoms. (Hear, hoar.) Yet, with such in dications before him, the right hon. gentleman began that great campaign which was to be signalised by vast reduc tions in the public debt of the country. Did the right hon. gentleman receive no warnings from this house ? A man whom we all look upon as a great authority on these sub jects rose and entreated him to pause. The hon. member for Westmoreland, whose absence from the house this ses sion has been such matter of regret—a man whom we all regard as of most competent authority on all these subjects —Mr. Alderman Thompson—particularly warned the right hon. gentleman, tolling him that the time for his operation was peculiarly inopportune, and reminding him earnestly that money was then in large demand, and per cent. dearer than it had been five months before. The right hon. gentleman, kowever, persisted in his plans. I will not nog,' dwell on what were the consequences of those plans. Tho committee will recollect that these Exchequer-bills, the price of which I have just quoted, the price of which had so declined, had the interest upon them reduced to per oont. at the time of which I have spoken. On the sth of May they were at 2s. premium; on the 26th of May they were at par ; on the 26th of September they were at 103. discount. The right hon. gentleman, in the interval, had made his financial statement, and estimated that by the reduction of the interest on Exchequer-bills he should effect an annual saving of 65,0001. It appears by one of the re turns for which I moved, and which are now on the table of the house, that the loss which that reduction of interest has occasioned is something like 36,0001., making, in the whole, so far as the financial statement of the right hon. gentleman is concerned, a difference of 100,000/. (Hoar.) That is the brief account of the dealings of the right hon. gentleman with Exchequer-bills, so far as the reduction of interest is concerned. But the right hon. gentleman fol lowed up this reduction of interest on Exchequer-bills by a much larger enterprise, which was announced as the herald of measures which would ultimately affect the amount of interest on the entire national debt—l allude to the plan of the right hon. gentleman for converting what he styled tho patriarchal stocks. It is of great importance that the com mittee should recollect that by these plans of conversion the country is now deprived of that balance in the Exche quer which nothing I have heard to-night has convinced me would not have been of great benefit to this country, especially at this critical juncture. Well, Sir, wero warn ings wanting to the right hon. gentleman on that occasion ? He advanced with only a small part of the great scheme, And what was that? He was to convert, in round figures, at the rate of 1001., stock, or an aggregate of small stocks, forming altogether a sum of little short of 10,000,000/.ster ling. I shall say nothing of the scheme by which this con version of stock was to be carried into effect. It consisted of three schemes, all of which were diametrically opposed to each other, (Hear, hear.) Ono of these was founded on the principle that the amount of the public debt should bo increased ; another on the principle that the amount of the public debt should be diminished; one went on the prin. ciplo that the amount of the funded debt should be dimin ished ; another on the principle that, by means of Exche quer-bonds, it should be largely, and, if the House of Com mons did not interfere, illimitably increased. The right • • hon. gentleman brought fer*terd his scheme with Confi dence in its merits and its strong success which strong con viction alone could give ; for he even proposed, or rather promised, that means should be taken to prevent the evils that might be occasioned otherwise, by too vast and sud den a rush of the public to carry out his views. (Hear, hear, and a laugh.) Was the right hon. gentleman, I ask, without warning at the time of the danger of his proposed course ? I will not quote the words that fell from myself and other gentlemen about me on this bench, which it might be supposed would not • be heeded, as coming from political opponents, though even the words of political opponents may not be without their value to some men ; but I will refer to the warning which was given to the right lion. gentleman by the hon. member for Hunting don, a gentleman of the 'very highest authority on these subjects, of conspicuous moderation, and who took an ac tive part in extending friendly opposition to the plans of the right hon. gentleman. That hon. gentleman, on the 22d of April, emphatically warned the right hon. gentleman that there were marked indications intimating the extreme inexpediency, the danger, of forcing a 24 per cent. ate& on the market, and of reducing the interest on Exchequer bills. (dear, hear.) Despite this and other warnings, the bill for converting " the patriarchal stocks" was read a thiid time on the 23d of April ; and on the 3d of May was read a third time in the other house of Parliweent, after an opposition by a noble lord of high authority on such matters, himself once a Chancellor of the Exchequer, and who certainly had no political sympathies with those who sit on this bench—my Lord Monteagle. (Hear, hear.) I shall say nothing, or very little, of the unbusiness-like way in which this bill was drawn. The fact is, it was desaribed es a bill of such vital importance by the leader of the house (whom I don't see in his place) that he depricated all cri - ticisin upon it, and it was prepared and carried— I won t say with indecent haste, but with such ill-considered limiter that when it was passed it was found out that there was a vital omission in it. It was discovered that in case any of the holders of these stocks dissented from the proposition, the Governtment had omitted any machinery by which they were to be paid the amount of their capital that was about to be discharged. It was in August—in the last , week, I believe, of the session—l see the bill only received the sanction of Parliament on the 16th of August—that this measure, empowering the Treasury to pay dissentients in various ways out of the consolidated fund, was passed— passed in the morning, with perhaps 20 members present ; and it was this bill so precipitately passed to remedy the mischances of what ought to have been a more mature measure—it was this rash, hurried, fatal piece of legislation that has deprived the Exchequer of its balances--(cheers) that has depreciated the consolidated fund, that in a time of war has allowedyou to scramble through the first quarter of this year with a deficiency of nearly 4,000,0001. sterling and which, so far as I can frame an opinion —and my object is only to elicit opinion—it is to the interest of all who have accurate information on this important subject, which, so far as I can form an opinion, will on the sth of April, with a balance in the Exchequer of 3,000,0001., leave the Chan cellor of the Exchequer to encounter demands of nearly 10,000,0001. sterling, if not more; and this in the time of a war which night after night every Minister who rises prepares us to expect will be one of longer duration and greater intensity than was anticipated when first the sub ject was under our notice. Now, sir, that appears to me to be an important point for us to consider—why we are in the position which I maintain the Exchequer ought not to be in. It was said the other night, with regard to the diplomatic correspondence on our table, that it was of no use to criticise the past, that the country was in danger, and that, under these circumstances, whether mistakes had been made or not, we must stand to those errors (l! they be errors), and that we must henceforth look only to the future. Well, sir, I have not made these observations with a view to criticise the past. If they had no reference, no necessary reference, to the future, I .should not have uttered a word. I moved for the series of returns which are upon the table at the beginning of the year, when Par liament first met, because I thought it of great importance that accurate information on such a subject should die in the bands of every member, and because they threw light upon what was the subject of fair discussion—the conduct of the late Government and the position in which they left the financial affairs of the country. I might make objections to the course taken by the right hon. gen tleman, and ask for explanations, but I am not desirous of doing so to-night on a subject of so great importance as the financial statement ; and why I bring these points be fore the house is, because I am certain that if you neglect this scheme, if yon sanction it by your approval, if you do not interfere to prevent its being permanently adopted, you will oftene in the course of this year, find yourselves involved in endless inconveniences, and even in monetary ' disaster. (Hear.) Let the right hon. gentleman come for ward, with respect to this second part of the subject, with the same frankness as he did with respect to the first. He says there will be a deficiency ; the nation is about to enter into a war, and there must be increased expenditure ; the Government must have efficient means to carry on the war with vigour, and the House of Commons must be ready' and prepared to support Ministers with ample means to put the revenue into a healthy state. Would it not be better for the right hon. gentleman to ask us to put the Treasury and the Exchequer in a healthy state at the same time ? (Hear.) Why does he not come forward and say, " I attempted to reduce the interest on the public debt; .1 have not succeeded as I intended ; but who can deny the object was one worthy of an effort, and worthy of the attention of Parliament ? Whether I have succeeded or not e it is one of those objects which every Chancellor of the Exchequer at some time or other should endeavour to c arry out. I have for the present been baffled by circumstances —grant even that I have made miscalculations—but I ap peal confidently to the generosity of the house as to my endeavour and its result. There has been or will beA loss on these transactions. Let us meet that loss. I have re duced the amount of public debt ; then put the public debt and the Exchequer in the same position as to amount as it was. 'Do that, and then I shall have balances in the Exchequer for the public service at a moment of exigency like the present." That is the course which I think the Chancellor of the Exchequer ought to pursue. (Hear.) I do not think the Chancellor of the Exchequer ought to have evaded fairly putting before the house the conse quences of his immature schemes for the reduction of in terest on the funded and unfunded debt of this country. (Hear.) Better that we should have with candour ad mitted the disappointing results of his efforts, and that be should have asked the house—and I am sure he would not have appealed in vain—to place him in the same state so far as the amount which he had reduced. The house should have been called upon to make that good to the Exchequer and the country. The right hon. gentleman has diminished the amount of the public debt of this coun try by 3,000,000/. sterling. He is entitled, then, t o oar support to the amount of this 3,000,0001. at a moment of exigency like the present, and he should have come forward and asked us not merely to vote taxes in order to put the revenue in a healthy state, but for such a vote as should put the Exchequer in a healthy state; for, de pend upon it, however you may balance income and ex penditure, however you may make a surplus upon paper, if your Exchequer is not in a right state you will always be in a position of embarrassment and difficulty. (Hear.) Now, the right hon. gentleman must raise deficiency bills for the quarter from the sth of April to July. I should like to know whether he has framed an estimate—l sup pose he has done so—of the amount of deficiency bills which will be necessary to carry on the public service from April to July? Can he have formed any estimate with regard to some of those extraordinary exigencies to which he has referred as possible ? From week to week; from day to day, something may occur which will demand from the right hon. gentleman what we may call a large balance at his banker's. (Hear.) The right hon. gentleman thinks what lam now going to refer to are trifling points. But the right hon. gentleman must pay for his deficiency bills. I have no doubt he finds the Bank of England as yet very indulgent, but that will not be the case for long if he keeps a very small balance there. The Bank of England will not like to be lending 5,000,0001. or 6,000,0001. of money at a lower than the market rate of interest, if they are only to have a balance of some 300,0001. on the public account. The Bank of England, sooner or later, must charge a Mi nister who depends on deficiency bills the market rate of interest, and I want to know what may not be the market rate of interest at such a time as this ? (Hear.) We have seen it suddenly rise at such a moment. Suppose, for in stance, you have a prolonged continental contest and a drain of the precious metal. Are you prepared to sanction a system that the Chancellor of the Exchequer should be administering the finances of this country by the aid, the systematic aid of deficiency bills, and not by real balances in the Exchequer ? A very great responsibility will de volve upon the committee if they sanction by their appro bation a course like that. (Hear, hear) I shall not enter into any consideration of the causes which have in duced the Chancellor of the Exchequer to take the course he has adopted with respect to his attempts to reduce the interest either upon Exchequer-bills or upon stock. I re serve to myself the right of referring to and of considering these pleas if they are made. My object is to impress upon the Committee of Ways and Means the great importance of refusing their sanction to a system of conducting the finances of this country, which I believe to be unsound, and which I believe also will end in great embarrassment and difficulty to theright hon. gentleman. I guard myself by saying this, though—that 1 deny the validity of any pleas which may be brought forward in vindication of his course either from the state of the harvest, the existence of war, or from circumstances of that kind. I won't enter into a consideration of these points, because then it would turn this discussion into merely a personal -controversy as regards the Ministry. I wish to keep it to this business like point—does the Committee of Ways and Means ap prove reducing balances in the Exchequer to such a degree that the Chancellor of the Exchequer mast systematically depend upon deficiency bills to a great amount for carry ing on the service of the country ? (Hear, hear.) I mean by " a great amount" millions • I mean 6,000,0001., 4,000,0001. we have evidence of, but I mean a greater sum than that ; and if the Committee of Ways and Means does not approve that course, let them not censure the Chan cellor of the Exchequer, but let them tell him to-night that they are prepared, with the same willingness, with the same unanimity with which they were prepared to support him in the imposition of freedh taxes, in order to p ro duce a sound state of the revenue, that they are equally pre pared to place on a healthy footing the balances of the Exchequer, which have been imperilled, perhaps, by the injudicious, but certainly b y the well - meant, plans of the (e:fit be the cr u t ; i:aithde ethpaintiewnheeftthheer Commit'tehaen d Means that the Ch ance ll or of the Exche quer Chancellor of th E e x E cia x e c q h u e t r e e e ve e n f u w e o a r y should not unnecessarily be borrowing money. The CHANCELLOR of the EXCHEQUER--The right hon. gentleman who has just sat down complains that u pon some recent occasion liberty was denied him to discuss past transactions. Now, lam sure I was no party to the denial of that freedom. The right hon. gentleman, so far as lam con cerned, is perfectly welcome to the discussion of any trans actions past, present, or future; and if he has any particular fondness for discussion upon questions of finance in which 1 am interested he will always find me quite ready to contribute to his interest in that pursuit by taking part iu it, as long es he is ready to return to the charge and the committee liac ° patience enough to listen. (Laughter.) The right hon. gentleman has complained of me to-night for want of frank ness, because I did not state to the committee the condition of the public balances. Now, lam in the recollection of the committee, as to whether I did or did net allude to that point. I intended to state, and believe I did state to theta distinctly, in a few words, that 12 months ago the public balances were high, and that now they are low, and, after stating that they aro low, I went on to explain how the m oneY, had been disposed of. (Hear, hear.) But, Sir, I won't dwel l on what may be considered as personal charges ; I will 6 . 0 rather to the discussion of those transactions of last year to which the right hon. gentleman has thought proper to r efer- The right hon. gentleman says that, with great imprudence, in the early part of last year I reduced the rate of interest upon Exchequer-bills ; that I anticipated from that reducti o the saving of 65,0001. a-year, but that, instead of a saving',_e .n e o, the result has been, in consequence of my proceedings, t there has been a loss of 35,000/. during the year on Exche quer-bills. quer-bills. Well, Sir, it appears to me in the first place supposing I were to admit the facts of the right honourable gentleman, his charge would resolve itself into this : I was unfortunately not endowed w 4,4 the gift .q.32113Ph67 that ] the s haws part I says Nothi hon. t of th him a whicl • the st 2▪ .thl the the st and vi of cor What ' and NI by m, I am ing tl Well, count man , (Hear facts Mr, Cons' The gentle gentle charg corn, fer to had I Each( said ii gentle gentle all in bills ; case A Wh telling bills 1 rate o mould nothir While , (Rear, Aso it ♦ Ilay j, rate O premi that amour COTITIC that h abaurc bands redeei the amour sometl nowt daye 0 ductio geutic : tho pr F ,. r loss that. e 1 occuir . It nec, 4 ref, Is n o • obsery raise t, • with bag sai butts bear.) (Rear, Irlah hi scheme dept it Thine, • all war does ht price ( tioverr ufterw: . 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