The Sun.
London, England, 1866-05-25 00:00:00

TIIE SUN, LONDO', FRIDAY EVENING, MAY 25, 1866.

of known and avowed deficiencies, such as years of war,
when they were obliged to resort to extraordinary re-
sources. The years of surplus did not require to be dis-
cussed, because they were agreed that there was no objec-
tion to the operation of the terminable annuities in those
years. Then as to the years of casual deficiencies. Suppose
that they were going to liquidate debt to the amount of one
million under the form of terminable annuities, and suppose
also that there was a casual deficit amounting also to one
million, what happened ? The Chancellor of the Exche-
quer, with his deficit of one million, as Finance Minister
went to the Chancellor of the Exchequer in his capacity of
Commissioner of the National Debt, who had just received
one million to invest, and in his capacity of National Debt
Commissioner he made over to himself, in his capacity of
Finance Minister, this one million, and received in return
Exchequer bills or bonds. It would be seen that there was
no waste or economical objection to this mode of proce-
dure. Coming next to years of avowed deficiency and
loan, the operation was equally simple. Suppose they had
a surplus in their banking account of one million, and sup-
pose they were going to raise a loan of five millions, the
National Debt Commissioners would simply take the one
million of loan upon the same terms as the bidders in the
open market. That was a perfectly simple operation, and
involved no economical objection. The only other con-
tingency which required to be taken into view was the
case of a deficit in their banking account, where the divi-
dends received upon the stock and other securities held by
the National Debt Commissioners, together with the de-
posits, were less than the calls made upon them by the de-
positors ; and secondly, where the banking account instead
of being able to help the Exchequer, was itself in need.
He contended that the operation of this bill was also bene-
ficial there. It would be open to them to borrow money.
Suppose they borrowed a million, and that went to keep
their banking account. That would prevent them selling
so much stock ; and he conceived it was not desirable,
especially in periods of depression, for the Government to
go into the market as sellers of stock. It would be much
better that any deficit should be raised by Exchequer bonds
or in some similar way. Admitting this, he did not think
that even in an extraordinary year mischief would occur,
while in every other year the operation would be of
the greatest convenience. With regard to operation B
the case was precisely the same, because the
house should remember that the money which
they were going to pay—the .£1,725,000—was the trust
money, and being trust money they must deal with it
according to the conditions of the trust. It was not to be
dealt with for the purposes of the Exchequer, but it was
held liable to the claims of the savings bank trustees. It
was perfectly true they would have to invest the surplus of
that money in the public stocks, but so they did under the
present law, and they did not propose to alter the conditions
as to investment; but these investments would, if this bill
passed, be reconvertable into terminable annuities, and the
produce of these annuities would be subject to the same
considerations which he had mentioned as applicable to
operation A. He ought, however, to keep in view the con-
tingency of the Government being borrowers and payers of
debt in the same year ; but this did not demand more than
passing notice, because on all occasions they must look not
to what might happen exceptionally, but to that which
happened ordinarily. All, however, depended, he must
admit, upon a clear comprehension by the house of the
position of the Government as bankers. Through the
Commissioners for the Reduction of the National Debt,
the Government was responsible to the savings bank trus-
tess for the principal and interest at a certain rate of all
moneys they received. The principal and interest con-
stituted the liability of the State considered as bankers.
The State invested the money it received from the trus-
tees of the savings banks, and it was those funds and the
dividends which it received that formed the assets of
the State. This measure was not bringing up its liabi-
lity; it was only bringing up its assets. What, therefore,
he would contemplate, and what he hoped the house and
future Parliaments would adopt, would to to adhere to the
policy of paying off the debt through terminable annuities,
by paying dividends simply as a bank, and by adjusting
their banking accounts to the wants of either years of de-
ficit or years of surplus. He did not, as had often been
suggested, propose going into the market. for the purpose
of selling these securities, but he looked to the public de-
posits as supplying the natural limits of the operations. It
was possible that the deposit in the hands of the State in
future years might be greatly enlarged. It was probable
that they would see cheaper money in this couutry, and
that no doubt would tend to increase the deposits. If the
operations of the Post Office savings banks were to con-
tinue, say for thirty-five years, at the same rate as they
had gone thus far, they would by that time have received
something like £50,000,000 the whole of which would
come into operation, and be available for being c'ealt with
in the manner proposed by the present bill. His own be-
lief was there were various funds in this country which

ought to be in the hands of the State, because if a deficit

were to occur in them that house would be called upon to
pay the loss, and that being the case it seemed to be a
corollary that this house should have the custody of them.
While, therefore, they did not propose going beyond
the deposits as a basis of operations, yet it was quite
poe'sible that the fund of which they proposed to make
use might be enlarged from time to time, either by the
causes which were now in operation, or by the possession
by that house of moneys which it now had not. With-
out going through the figures which were in the hands
of hon. gentlemen, it would give him satisfaction to give
any explanation that might be required, and he would be
happy to listen to the sentiments which might be ex-
pressed by other gentlemen, members of that House.
Making freely the admission and setting out with it as a
principle, that thry did not desire to be parties to the re-

establishment of a sinking fund, and thinking that they
did possess, through the banking offices of the State, a
means by which they could avail themselves of the un-
doubted advantages for liquidating the debt through the

system of terminable annuities, and avoiding the incon-
veniences which in former times had beset that system,
most anxious was he not to claim for this proposal
the credit of effecting great operations. It was quite
possible that what might take place under what he had
called operation B might be very insignicant indeed.
However, he was bound to point out to the House that in
that case the Post Office savings banks would supply a
fund by which they would have the power to make ter-

minable annuities. The House would observe that he
had not argued the question at all in detail, but had spoken
of the policy of making this application of the money rather
than of applying it to the remission of any particular im-
post. lie should only be taxing the patience of the house
if he were to enter into any probable operations in an ex-
ceptional year. What he proposed was of the character of
a financial operation that might he easilyunderstood by the
house, so that the house was able to form a judgment upon
the important question whether they were endeavouring to
pursue a public object, whether they were liable or not
liable—he thought they were not liable—for the re-intro-
duction of principles which, however plausible they might
be at first, had been proved unsatisfactory, and principles
which, after such confutation by right and practice, it would
be a mistake on the part of any Government to place on
the statute-book of the country.
Mr. HUBBARD objected to several items in the pro-
posed scheme of terminable annuities, and taxed the Chan-
cellor of the Exchequer with dealing unfairly with savings
banks deposits. He trusted that this would be thoroughly
investigated when passing through committee.
Mr. LAING- complained of the disparity which existed
between the Chancellor of the Exchequer's budget speech
and his additional financial statement. The terminable
annuities were then spoken of as a mode of reducing the
national debt which would virtually be by taxation ; but it
appeared now that for them to lapse into a permanent
sinking furd was a more delusion, as the bill could be
swamped at any moment by decree of the Chancellor of the

Exchequer. He did not approve of entering into pros-
pective engagements, neither did he believe that

the scarcity of coal which was predicted would lessen our

resources to the extent contemplated. If such scarcity

should occur, other branches of industry would take the

place of those which required an abundance of fuel. He
thought that if the duties on consumable articles, such as

sugar, were reduced, we should benefit commerce and the
working classes better than in an attempt to lessen the

national debt by means of extra taxation.
Sir FITZROY KELLY objected to the principle of
raising large sums of money by means of taxation for the
purpose of reducing the national debt. He reviewed the
scheme of the. Chancellor of the Exchequer in an elaborate

speech, and contended that it was unwise, impolitic, and

dangerous in the extreme to bind ourselves to a policy of
annual payments of at least a million extending over forty
years without knowing that the condition of the country

would bear the extra taxation.

Mr. FAWCETT was sorry to differ from the Chancellor
of the Exchequer, but he thought the terminable annuities
a bad scheme, because it was an uncertain scheme. It was
impossible to see what the effect of this extra taxation may
be in 1885. The endeavour to throw upon our successors

a greater annual payment than we were prepared to pay
was an unfortunate project. This was not a period to in-
crease the taxation of the country, and the only way, in
his estimation, to reduce the National Debt was to have a
yearly increasing surplus revenue which could be thus
applied.

Mr. CHILDERS defended the Government Bill, and
went over the scheme proposed by the Chancellor of the
Exchequer, which, he said, would not tax the country to
the extent which had been suggested. It was a sound
financial arrangement, and one which would tend to increase
the credit of the English nation.

Mr. HENLEY ridiculed the Government scheme of ter-
minable annuities, and pointed to the difficulties of meet-
ing the payments guaranteed in future years.
After a few words from Mr. Samuelson, Mr. Liddell, and
Mr. Vivian, the second reading was agreed to.

Mr. COWPER introduced the second reading of the
Commons (Metropolis) Bill, which was intended to facili-
tate the purchase of open spaces for public recreation
within 45 miles of London and four miles of other towns,
and to appoint commissioners to report upon such lands.
After lengthened remarks from Mr. Ayrton, Sir W. Jol-
liffe, and Mr. Buxton,
Mr. COWPER agreed to the bill being referred to a select
committee, with instructions that it should be extended to
all large towns in England.
The remaining orders of the day were then disposed of,
and the house adjourned.

Naval and Military Intelligence.

Yesterday Major-General Sir Robert Walpole,
K.C.8., commanding the Chatham district, com-
menced the half-yearly inspection of thetroops under
his command, the first day being devoted to the in-
spection of the Ist Depot Battalion of Infantry,
under the command of Col. J. W. Smith, C.B. In
the morning Sir Robert Walpole inspected the
books, accounts, and the official records and docu-
ments of the battalion, and afterwards visited the
barrack-room and quarters occupied by the troops.
At 4 o'clock yesterday afternoon the various regi-
ments and depots comprising the battalion, includ-
ing the Ist and 2d battalions of the 4th King's Own
Royals, the Ist and 2d battalions of the 15th
Regiment, 35th Regiment, 77th Regiment, and 94th
Regiment, were formed on the review ground within
the inner lines of fortifications, where on the arrival
of Sir R. Walpole the inspection of the various corps
was proceeded with, the arms, kits, accoutrements,
&c., of the non-commissioned officers and men being
first examined, and the companies afterwards exer-
cised in various movements to test their efficiency in
battalion drill. Major-Gen. Sir R. Walpole will
eontinue his inspection of the other troops at the
garrison this evening.
The out-pensioners of Chelsea hospital, attached
to the Chatham district, including those formerly
belonging to the various cavalry and infantry regi-
ments, and the Royal Marines Light Infantry having
completed their annual period of training, under the
command of Col. R. Jenkins, were inspected on
Chatham-lines yesterday by Col. J. W. S. Smith,
C. 8., commanding the Ist battalion of infantry at
the garrison. The various companies, numbering in
the aggregate about 400 men of all ranks, having
assembled in front of their quarters, near St. Mary's
Barracks, were marched to their lines, where they
were put through the manual and platoon exercises,
and afterwards inspected in a variety of movements,
in which the veterans acquitted themselves most effi-
ciently, the whole of the movements being gone
threugh with the utmost steadiness and precision.
The pensioners will return their uniforms, accoutre-
ments, and rifles into store to-day, and will then be
released from further duty until again called out for
training.
Major-Gen. Warde, C. 8., commanding the dis-
trict of Woolwich, on Tuesday brigaded on the re-
view ground at Woolwich-common a large portion
of the non-duty men for inspection, which it is an-
nouneed will be carried out on Thursdays, each
week, during the summer seasons, the weather per-
mitting. The force assembled consisted of three
troops of Horse Artillery of the C Brigade, in com-
mand of Col. A. Huyshe, three batteries of the Bth
Brigade Field Artillery, in command of Col. Riddell,
C. 8., recently marched into garrison from Dublin,
four batteries of other brigades mounted, and a bat-
talion of Royal Marine Light Infantry in command
of Second-Commandant Col. Lambrick, A.D.C. to
the Queen, making a total strength of 1,122 men,
42 guns, and 636 horses of the Royal Artillery and
800 men of the Royal Marines. The ground was
pointed out by Brigade-Major Hay, and the line
was formed soon after nine o'clock, the Light In-
fantry in the centre, and the troop of the Royal
Horse Artillery (acting as cavalry) and the field
batteries right and left. After being inspected front
and rear they marched past, and subsequently went
through a most interesting course of field-day's ma-
noeuvres, occupying three hours. The batteries were
supplied with 10 rounds of blank cartridge per gun,
and the infantry 15 rounds per man. Major-Gen.
Warde stated to Colonel Louis, who commanded

a portion of the Royal Marines, that he was much
gratified at the steady and correct manner in which
the battalion had performed their movements, the
correctness of which would lead one to suppose
that they were at the close, instead of the com-
mencement of the drill season. The firing and
marching of the battalion, he added, were, as usual,
excellent.

Capt. and Adjt. Shadham, Quartermaster Wil-
liams, and the head-quarters staff of the 4th Bri-
gade Field Artillery, accompanied by a detachment
of non-commissioned officers and privates, left
Woolwich on Tuesday for the Euston-square sta-
tion, where they were joined by a detachment from
Warley, and proceeded by a train to Liverpool,

Doyle, master, additional, to the Indus, for the
Vestal ; George A. Stubb, master, additional, to
the Frederick William ; and Richard Sainthill, pay-
master, additional, to the Topaze.

Railway and other Companies.

LONDON AND NORTH WESTERN.

The adjourned n harncliffe meeting of this com-
pany, appointed to be held yesterday at the Euston
station, Mr. Moon in the chair, was further ad-
journed, in consequence of none of the bills being
ready, to the 29th inst.