The Sun.
London, England, 1856-05-20 00:00:00

bushels. Now, although it is tree that the duty on malt has
an effect upon the+ consumption, it is right that I should
point out that on the whole—taking the malt duty, as it is
at present under the distillery law, as nothing more than a
beer duty in another form—the' article of beer is lightly
taxed at this time when compared with the burdens which
it has borne at comparatively recent periods. From the
peace up to the year 1829 there was a beer duty as well as
malt duty and a hop duty. The average produce of those
three duties for the years, 1827, 18'!8, and 1829, was
7,192,1741. The beer cluty alone produced in 18273,200,9021.;
in 1828, 3,294,6971. ; and in 1829, 2,989,661/. That duty
was repealed in 1329, and it has not since been reimposed.
In 1831, i 832, and 18f;:3 the average produce of the malt
and hop duties, which were the only two duties which then
fell upon beer, was 5,01 1,911/.,as compared with 7,192,474/.
in the three preceding '
'years. During the last three years
the average produce of the two duties of malt and hops has
been 6,530,8861. a-vear... Therefore, if we take the produce
of the war malt duty and compare it with the average
tax on beer in the years 1827, 1828, and 1829, it will be
seen that in those three years the average duty was
7,193,4741., whereas in ehe last three years it has only. been
6,530,886/. Including the warduty therefore on malt, beer
has been in the last two years a more lightly taxed article
than it was in 1827, 1328, and 1829. There is another
pAnt of view in which the duties on beer and on spirits
may be compared, whh:h certainly favours the assumption
that the duty on malt is not excessive. Unquestionably, if
the duty on ,pitits can be considered reasonable, the pre-
sent duty on beer must be regarded as altogether insignifi-
cant. The price of abarxel of beer may be taken at about
335. The quantity of nanit used in making that beer pays
a duty of about 6s. 4d., and the hops pay about 4d. The
duty, therefore, upon a let rrel of beer may be taken at 6a.
81., the proportion of the duty to the price being about 25
per cent. Now, the price 'of a gallon of plain spirits is about
10s, Bd. The duty thereon is Bs. ; so that the proportion
of duty to price in the cane of spirits is not less than 300
per cent. This comparison certainly shows that, as con-
trasted with spirits, beer is subjected to an extremely mo-
derate tax. I will now revel certain figures to which I have
before referred, showing the gross and net amounts which
we estimate to receive from. the different branches of re-
venue :

Gross Estimate. Nat Estimate:
Customs . £23,850,000 £22,524,000
Excise .. ..... 17,170,000 16,348,0(0
Stamps
Lands and assessed taxes..... 3,110,000 2,950,000
Property and income tax..., 16,3.55,000 16,000,000
Post-office ..
Crown lands . ..... 260,000 260,000
Miscellaneous ~. 1,000,000 1,000,000

Total £71,740,000 £67,152,000
Then, deducting the total es 4 imated revenue from the total
estimated expenditure—incl u ding the margin of 2,000,0001.
which I stated that I should usquest the committee to assent
to in order to guard against. ,contingencies—the deficiency
will be 10,373,0001. From that sum must be deducted
1,500,0001. which has been r •eceived in the present year as
the produce of the loan of 5,,000,0001., which was effected a
short time before Easter ; anti that makes the estimated
deficieneyB,B73,ooo/.; or,om itting the margin of 2,00 J,OOO/„,
it leaves the real estimated, deficiency at 6,873,000/. ; or,
adding the 2,000,C.03/., whi‘th wepropose as a vote of credit,
the estimated deficiency wi l/ be 8,873,0001. In this state
of the public revenue and expenditure, her Majesty's Go-
vernment do not think that, in the present circumstances
of the country, looking to the probability of the public in•
come at any early period becoming adequate to meet all
the demands upon it, and also having regard to the expec-
tations naturally excited by- a return from war to peace,
as well as to the difficulty of imposing any new taxes, they
would be justified in proposing any additional taxation to
this house. On the other hand, with the estimated defi-
ciency in the expenditure of the year to which I have ad-
verted, we do not feel it consistent with our duty to recom-
mend any diminution from any source of revenue which the
existing law supplies. We have, therefore, determined to
propose no change in the present taxation of the country.
If the common phrase, "state of transition," is ever appli-
cable, it is especially so in regard to the present year, when
we are passing from a state of war to one of peace, and
when the country is placed in circumstances of so peculiar,
temporary, and exceptional a nature as to render any pro-
posals calculated to affect the future in any permanent
manner wholly impolitic and undesirable. We have, there-
fore, arrived at the decision to maintain the public taxation
on its existing basis ; and have resolved to resort to borrow-
ing to make up the deficiency. We propose, in the first in.
stance' to have recourse to a loan of 5,000,0001. The pro-
posals for that loan were made public a short time since.
The offers were received this morning at the Treasury.
The price originally offered was 1081. for 1001. in Console.
The reserve price fixed by the Government was some-
what less being 1071. 10s. 7d., or equal to Con-
sols at 93. The terms fixed by the Government were
accepted by the contractors, and the usual agreement was
signed by both parties this morning. The arrangement
will be submitted to the committee in the form of
a resolution, which I shall move before I conclude.
This transaction, illustrating as it does the great
resources and ample available capital of this country at
the close of the arduous contest in which we have for two
years been engaged, may be regarded in that point of view
as very satisfactory; and it is further gratifying as show-
ing the extensive monetary operations conducted by single
individuals in this country, in whose honour great confi•
dance is deservedly placed by a large portion of the com-
munity. Baron Lionel do Rothschild informed me this
morning that the deposits in his hands, sent by persons
desirous of obtaining a share in this loan, amounted to ts,
sum of not less than 4,000,0001., the whole of which was
transmitted either in Bank of England notes or in gold.
The amount thus subscribed in actual money, being dee
posits of 10 per cent. on the loan, represented a capital
of 40,000,000/. (Hear, hear.) This fact .1: state on the
authority, and with the permission, of Baron Reths•
child • and I believe that the committee, on an examine-
tiou of the price of stocks, will be of opinion that the lean
agreed to this morning was effected on terms perfectly
fair as between the parties concerned; that while, on the
one hand, the price is as high as her Majesty's Govern-
ment bad a right to expect, a reasonable rate of remune-
ration on the other is secured to those who come forward
at such a moment to advance their capital to the public.
' I therefore trust that the committee will allow that her
Majesty's Government exercised a sound discretion in ne-
gotiating a loan on the terms and in the manner which I
have described. (Hear, hear.) But this loan will not
cover the entire estimate:l deficiency of the year. Omit-
ting for the present the margin of 2,000,0001. for contin-
gent expenses, the estimated deficiency for the year is
6,873,0001.; thus leaving, beyond the loan of 5,000,0004,
an estimated deficit of 1,873,0001. This sum I reckon
in round numbers at 2,000,0001., and I propose, at
a later period of the session to ask the house to
agree to confer on the Government a power of bor-
rowing, when the necessity shall arise, an amount
equal to that in Exchequer-bonds, with an alternative
power of issuing Exchequer-bills, should the state of
the money-market render such an operation advisable,
to the extent of 2,000,0001. That sum, as the committee
will have collected from my statement, will cover the
whole of the estimated deficiency of the year. If the
house should agree to a vote of credit of 200,0001., to meet
any accidental excess, I propose to take a similar power
to cover that vote also,—a power which I trust there will.
be no difficulty in granting. I have stated that I propose
probably to borrow that sum in Exchequer Bonds. The
present state of the Exchequer Bill market may render it
inexpedient to increase that portion of the unfunded debt.
Many-circumstances have occurred of late years calculated
to diminish the quantity of Exchequer Bills which can be
made to float upon terms advantageous to the holders.
The great increase in the amount of railway debentures
has produced a security of a similar nature which comes
into competition with Exchequer-bills. The placing of
money at call with bankers is another circumstance which
has abridged the demand for Exchequer-bills. There is
not, therefore, an active call at present for so large
an amount of these securities at a fair premium as was for-
merly the case. At the same time I believe that tempo-
rary causes have produced the fall in their value which has
occurred during the last week or fortnight, and it would be
rash to draw any decided inference from so brief an expe-
rience. With the permission of the committee I shall
state the precise quantity of Exchequer-bills now in the
market. That quantity was diminished by the funding
before Easter. The amount of Exchequer-bills outstand-
ing this day (19th May) is 20,124,0101. ; but of that sum
the Commissioners for the Reduction of the National Debt
hold 5,000,0001. This 5,000,0001. may be regarded as vir-
tually in the bands of the Government, and is never likely
to be brought into the market. The amount of these bills in
the hands of the public. is therefore no greater than
15,121,00 N. There are many circumstances which render it
probable that the depreciation inExchquer-bills for the last
10 or or 14 days is of a merely accidental nature, and that
they will soon resume the position they had before the fund-
ing was announced and continue a portion of the unfunded
debt. At the end of the late contest, in which considerable
additions have been made to our national debt, it is na-
tural that we should revert in retrospect to the progress
and fate of that debt in previous wars. Unfortunately,
among the most marked characteristics of the national

debt of this country has been its immoveability, the very
slow efforts made to reduce it, when once it has been in-
erewed— the increase being allowed to remain, while little
has been done in suli4equent years towards its diminution
either by the operation of a sinking fund or otherwise.
However, we cannot but observe with satisfaction that out
present position, as compared with the state of our debt at
the end of the last war, is not a disadvantageous one. I
will trouble the committee, as the subject is of great im-
portance, with a simple comparison of the state of our
funded and unfunded debt at the close of the last war and.
at the present time. On the sth of January, 1816, the
capital of the funded debt of England was stated at
816,311,939/. ;
on the sth of January, 1856, it was
showing a decrease of 49,533,310/. That de-
crease 7 66J78
1; 115 599 taken
to the debt last year. I come now to the unfunded debt;
where the comparison is even more favourable. On the
sth of January, 1816, the unfunded debt was stated at
diminution
43,939,708/. ; on the sth Jan. last it was 26,614,200/ , show-
of unfundedtihnethe t,ond
ed
a.debt t
the
IDrg,3t7s,dse9cBrle.aseThinthe capital
The total
unfunded debt since the end of the last war is 66,858,848'e
LA us now see what h c ange has taken place in the charge
of the debt. On the sth Jan., 1816, the charge of the funded
debt was 30,4)8,204/. ; on the sth of January, 1856, it was
27,275,763/.—showino• a diminution of 3,182,436/. With
regard to the unfunded debt, the chalgo on Jan. 5, 1816,
was 2,323961/. ; on Jan. 5, 1856, it was no more than
993.7691., showing a diminution of 1,332,1951. The total
diminution in the charge of the funded and unfunded debt
since the close of the last war is 4,514,6311. In connection
with the question of the debt, it is right I should
state to the committee what are those accruing liabilities
in the nature of that debt which are to be anticipated in
the immediately fellowing years, and which will have to be
met out of the revenue of the country. Next year-1857
—there will fall due Exchequer bonds to the amount of
2,000,0001. In 1853 there will fall duo Exchequer bonds
to the same amount., end a sinking fund for war loans to
the amount of 1,500,0001., making a total of 3,500,0001.
The accruing liabilities will be the same in 1859; but in
the following year —lB6O —the Exchequer-bonds falling
due will be 1,000,0001., and the sinking fund 1,500,0001.,
making the total amount 2,500,0001. From 1861 to 1873
there will be au annual payment of 1,500,0001. for the war
sinking fund, and from 1874 to 1877 the payment will be
500,0001. per annum. The statement which I have now
made goes up to April last, and does not include any bonds
which may be issued in the present financial year. While
much are our accruing liabilities, there is one topic of con-
solation which I am happy to be able to put before the
committee. In 1860 annuities will cease to the amount of
2,150,0001., and in 1867 there, will be a cessation of the
dead weight of naval and military pensions to the extent
of 585,7401. Sir, the statement which I have made seems to
me to exhibit the only manner in which the national debt can
ever be really extinguished. It is a sanguine delusion to ex-
pect that any mysterious self-acting sinking fund can be
formed by which the debt of a country can ever be dimi-
nished. Public debt, like private debt, can be extinguished
only by the application of money. In the case of a nation
that money can be raised only by taxation, There is only
one resource to which an honest Legislature can resort iu
our pesition7yiL., to raiiit a aupila mow) by taxaticw,