The Sun.
London, England, 1858-02-23 00:00:00

the clause which involved an entirely new principle and
would raise an important discussion.
The house then went into committee.
On the question that the preamble be postponed,
The CHANCELLOR of the EXCHEQUER said,—
I hope I shall be able to satisfy the committee that
there is a real reason of convenience for proceeding
with the bill at this moment. The course which her
Majesty's present advisers—l will not say her Ma-
jesty's Government—are taking in asking the house
to consider the measure is quite disinterested on their
part, inasmuch as it does not in any way concern
them at present that the bill should make progress.
In quitting office, however, they are desirous not to
leave such a deficiency of revenue as would create an in-
convenience to their successors, or render necessary a
supplemental vote and an encroachment on the balances
in the Exchequer, which might have to be resorted to if
the East India Company are not empower
ad by raising
money on loan to repay the advances which have been
made to them by the Exchequer during the course of the
present year. The proposal is to authorise the Company,
for the service of the Home Government, to raise money,
either by debentures or tends. Stich a proposition in-
no new principle. From a very early period the East
India Company have frem time to time been empowered
to raise money by bonds in this country, and the raising
it by debentures constitutes merely a formal alteration,
which makes no difference in point of principle. When
they were a trading as well as a governing corporation
they raised money on bonds for the purposes of their
trade. At that time Parliament thought fit, as it limits
the amount borrowed by other trading companies, such
as railway companies, to limit the amount which this
corporation could raise by their bonds. As soon as the
Company ceased to be a trading company, and remained
merely a governing body—a subordinate part of the
Rome Government of India—their position was entirely
altered. Nevertheless, the old maxim was thought to
apply—namely, that they had not an unlimited power
of borrowing in this country for the service of the Indian
Government. It was stated by the hon. member. for
Guildford (Mr. Mangles), and from communicatioes
with the India-house I know it to be the fact, that the
opinion of counsel has been taken on the point whether
new that they have ceased to be a trading body, there is
anything to restrain them from borrowing money in Eng-
land for the service of the Home Government; and the
opinion of counsel is that there is nothing so to prevent
them, so that in fact, if thatopinion be just, there would
be no necessity for passing this bill. But the Go
vernraent thought, and so advised the Company
that inasmuch as it had been the invariable practice
for Parliament to authorise them to borrow on bonds
in this country, it would not be expedient to act on the
opinion expres ed by counsel, and that it would be
more respectful to Parliament to ask for their express
authority. For that reason the bill has been introduced.
As I said before the measure involves no new principle
whatever. In point of fact the company have now a power
to borrow on bonds which is not wholly, though it is
nearly exhausted. Therefore, when it is argued that this
is a dangerous principle, and that it would involve the
British Exchequer, my answer is, that the principle is
neither new nor dangerous, and that it is perfectly no
derstood with respect to. loans contracted by the Com-
pany in the money-market. If the committee wish I will
go through the items of account which has been framed
by the Company, containing an estimate of the probable
charges upon the home Government of India until the
end of their next financial year, April 30, 1859, and the
means they estimate for meeting these charges. Perhaps
it is unnecessary thatl should do more than mention the
result, which is, that there world be a deficit of about
7,500,0001. The charges have, I think, been taken on
rather a liberal scale, and the probability is, as far as we
can judge at present, that the deficiency will be a sum
considerably less than 7,500,0001. However, in the pre-
sent State of India it is difficult to form anything like a
olose approximation to the truth in framing an estimate,
and we will therefore assume that at the end of the Com-
pany's financial year, on April 30, 1859, there will pro.
bably be a deficiency exceeding 7,000,0001. Now, the
question arises how that deficiency is to be met. The hon.
baronet opposite contends that there is danger in autho-
rising the East India Company to borrow this money,
inasmuch as the consequence of such a step may be the
creation of a prospective charge upon the Imperial
Exchequer.
Sir H. WILLOUGHBY—I simply wished to have
an assurance from the Government that there was no
danger involved in the measure.
The CHANCELLOR of the EXCHEQUER—My
answer to the hon. baronet is, that there is a charge to
a certain amount to be met, and that we must endeavour
to meet it in one way or another. It is the duty of Par-
liament to see that adequate means be provided for that
purpose, and we, with that view, propose to enable the
East India Company to borrow in the English market,
the unlimited power of raising loans in the native market
which they possess being now exhausted. The hon.
baronet wishes further to know what is the exact
amount of the present debt of the Government of India ?
In reply to that question I may state that the gross in-
come derivable from our Indian possessions is about
29,000,900/. per annum, and that the stock of the Com-
pany—which is a portion of their debt guaranteed by
Parliament, bat not guaranteed upon the credit of the
British Exchequer, the fund out of which the dividends
are to be paid not being designated by the Legislature—
amounts to 6,000,0001.
Mr. WALPOLE—There is a virtual guarantee upon
OUT part in reference to that stock.
The CHANCELLOR of the EXCHEQUER—In the
event of the failure of the Indian revenue, the faith of
Parliament is no doubt pledged to provide for the pay-
ment of the dividends out of the English Exchequer—
(hear, hear)—but there exists no necessity for making a
demand upon it until that revenue becomes exhausted. I
think, therefore, I am right in saying that there is no
direct and primary charge upon the Exchequer of Erg.
land in connexion with this stock. That stook, as I have
just stated, amounts to 6,000,0001., and is guaranteed at
12,000,0001.—that is to say, 2001. are to be paid for
every 1001., so that the whole sum may therefore be
considered as equivalent to a debt of 12,000,000/. Now
the guarantee fund which is to be set off ageing that
debt amounts to about 4,500 0001., and we reckon that
it will in the course et a few years he as high as
7,000,0001. Well, the India debt is 50,483,0001., and
the bond debt about 6,000,000/. ; those various sums in
conjunction constituting a total charge of 63,483,0001.
That is the whole of the present charge upon the reve-
nues of India, and against that is to be set off the gua-
rantee fund. The committee will therefore see that,
comparing the gross debt of India with its annual reve-
nue—which is 29,000,0001.—the amount is not so con-
siderable as might have been supposed. There is,
however, another way of looking at the Indian debt.
Sir H. WILLOUGHBY—Are the railway guarantees
included in the statement you have just made 1
The CHANCELLOR of the EXCHEQUER—No.
I am referring to that which is, strictly speaking, the
amount of the debt, and I may add that what seems to
ms to be most material with respect to it is not the
nominal amount of the capital of the debt, but the annual
charge which it imposes. The total annual charge for
the Indian debt, according to the last accounts presented
to Parliament, which relate to the year ending the 3d
of April, IESB, was as follows :
Interest on the India debt £2,044 313
Interest on the home bonded debt
Dividends to proprietors of stock