The Sun.
London, England, 1859-03-11 00:00:00

VOTE BY BALLOT.

Mr. WYLD gave notice that he would move, in
addition to the resolution of the noble lord (the member
for London) relative to the Ministerial Reform Bill, to the
effect that votes for members of Parliament should be taken
by ballot.

EXCHEQUER BILLS.
Mr. HANKEY called the attention of the house to the
late funding of Exchequer-bills, and moved, " That in
future no funding of Evhequer-bills held by the Commis-
sioners of Savings-bankoe made without the special autho-
rity of an Act of Parliament." The resolution wasidentical
with the recommendation of the report of the Committee on
Savings-banks. He had brought it forward without any
intention of making an attack on the Chancellor of the Ex-
chequer. He would not lay much stress on the difference
of the charge for interest on Exchequer-bills as compared
with the charge on £3 per cent, stock, but he thought it was
a matter of very grave importance that the house should
well consider any question which involved an increase of
the permanent debt of the country. He believed that the way
in which deposits in savings-banks were dealt with was this :
—All deposits in savings-banks were presumed to be in-
vested as soon as possible in Government securities. That
was necessary in order to prevent any money lying idle at the
Bank of England in the name of the Commissioners of
Savings-banks. But when these deposits were invested in
that manner there was not necessarily any increase in the
total amount of the funded debt. Suppose these deposits
were required to be repaid to the depositors, stock to provide
for their repayment would be sold, and the fundedi debt would
then stand precisely as it did before the Government trans-
action. But if, instead of purchasing stock in the open
market, the deposits of savings-banks were invested in Ex-
chequer-bills, as they might be in accordance with the Act
of Parliament, and in the course of time these Exchequer-
bills were converted into stock, these Exchequer-bills were
cancelled, but the stock remained as a permanent charge.
He was quite aware that the indebtedness of the country
was not altered by that operation; but it did appear
to him to make a great difference if, whenever repayment
of these deposits was required, the money should be
obtained by increasing the permanent charge upon the
country, instead of by merely re-selling Exchequer-bills
in the open market. He believed it was during the
late war that this mode of funding was resorted to.
Most probably the late Chancellor of the Exchequer saw
a necessity for providing money in that way, as being the
most free from difficulty. About £4,000,000 of Exchequer-
bills were, he believed, funded in 1853 or 1864. The effect
of that operation was to take a certain amount of Exchequer-
bills out of the market, whereby the price of Exchequer-
bills was enhanced, they being, perhaps, at the moment at
a discount. Now, that operation was in effect neither more
nor less than a war loan. He was afraid that the present
Chancellor of the Exchequer regarded that operation as a
very convenient one, and would have resorted to it if he
had been in office during the late war. About £16,000,000
of stock had been added to the funded debt within the last
20 years by means of the existing arrangements between the
Government and savings-banks. That involved a perma-
nent charge of nearly £500,000 a-year. The house ought to
watch these operations very jealously. He believed it had
never been contemplated that the Savings-bank Act should
be a means of permanently increasing the funded debt. He
hoped to bear from the Government that they had no in-
tention to make use of this power. At the same time it was
desirable that the Chancellors of the Exchequer should have
no authority to fund except by making special application
to Parliament for that purpose ; and if such an understand-
ing were come to the Government would very seldom put
this power into execution. The hon. member concluded by
moving his resolution.

Sir S. NORTHCOTE complained that the hon. gentle-
man had employed terms in speaking of this question which
were calculated to mislead hon. members not very familiar
' with it. He had described this operation as if it were one for
increasing the national debt. The real state of the case,
tracing it from its commencement, was this :—The savings-
banks were institutions in which individual depositors
placed their money, which they received from the ma-
nagers a certain rate of interest. The managers of these
banks held a part of this money to meet current demands,
and invested the remainder with the Commissioners for the
Reduction of the National Debt, from whom they received
a larger interest than they paid to their depositors. There-
fore the managers of the savings-banks derived enough
in the shape of interest from these commissioners to pay
interest to their depositors, to defray the expenses of ma-
nagement, and to enable them to keep a balance out of which
to meet current accounts. The Commissioners for the Re-
duction of the National Debt, having these moneys in their
charge, must do in their turn for the savings-banksjare-
cisely what the savings-banks did for their depositors. That
was to say, they must hold a balance in hand to meet cur-
rent demands from individual savings-banks, and also con-
trive to provide the interest for them. A priori they must
make the best use they could of the balance they had in
hand ; but the law stepped in and prevented them from
doing so by compelling them to invest this balance in cer-
tain securities—viz., the public funds, which ordinarily
yielded an interest rather below that which the Commis-
sioners of the National Debt were bound to give to the
savings-banks. The transaction must naturally have been
one occasioning some loss instead of producing a profit to
the commissioners; but the security of these funds was
guaranteed by the public, and any deficiency would conse-
quently fall up
on the country. It should also be borne in
mind that the Commissioners for the Reduction of the Na-
tional Debtou twheerme to another source of loss. If demands
sell stock to meet Ittla
came up
excesse of the money paid in, they must
the price of stock . Those demands usually came when
money usually c
Therefore the money received amewastit low, and, on the other hand, the
the price of stock was high.
were high,
and
the
ed was invested in the funds
commissioners had to sell
owuhtewnhtehneythe funds were low. Under these circumstances
it was clear that upon the whole transactiont the Govern-
ment of the country subjected itself
sand, that being
moderate extent to the certainty, of lots
risk, and to a
hardlpyofsaisirblteo wpreithveonutt itdaimntin:lsain such use of this
so, it was
if the Chancellor of the Exchequer
yecausriwtyasof depositors or the profits of the any
degree
tmhoenes
of savings-banks. The hon. gentleman had siCintliii:tgerB
ac-
leem,to buy Exchequer-bills, he mightcer
tchoordinughgttoitthdiessinsysbt
to-morrow sell £8,000,000 of Consols and invest the
these securi-
ties for some time he might fund thenl and so add
proceeds in such bills' ; and that after holding
£8,000,000 to the permanent funded debt. That was hardly
so, because, according to his understanding of the matter,
the sale of Consols would reduce the funded debt, and the
subsequent funding of Exchequer-bills would only amount
to a replacement. The hon. gentleman had brought this
subject forward in the terms of one of the recommendations
of the select committee which sat last session upon the
Savings' Banks Act ; but it was not fair to forget that that
committee made other recommendations, the adoption of
some of which would tend to mitigate the loss which the
Government at present sustained. For instance, one of
those recommendations was that the Government should be
allowed to invest these deposits in securities other than the
funds, which would give a better rate of interest. It was
hardly fair to select a single recommendation of the min-
i/attic and place it alone. This matter ought to be cowl-

Mig.

THE SUN, LONDON, FRIDAY EVENING, MARCH 11, 1859.

of the Exchequer will be able to state an adequate reason
for the operation.
Mr. T. BARING was a member of the committee re
ferred to by the right hon. gentleman. That committee was
appointed to inquire into the administration of the funds of
the savings-banks, and to see whether due security was
afforded to the depositors. The right hon. gentleman said
the committee had no right to inquire how the money was
disposed of.
Sir G. C. LEWIS said he did not mean to question the
powers of the committee, but had only said, judging from
the report, that they had not inquired into one branch of
the subject so carefully as into another.
Mr. T. BARING said that the right hon. gentleman had
stated that the Government was banker for the savings-
banks ; but one question for the committee to consider was
to what extent the Government was a security to the de-
positor, and the result of the inquiry was, as he believed,
that all these changes of securities were not made always for
the benefit of the savings-banks, but sometimes to aid a
i
needy Chancellor of the Exchequer n his operations. (Hear.)
That was the ground on which the committee ventured to
recommend that some limit should be placed on the power
of the Commissioners of the National Debt, or in other
words, of the Chancellor of the Exchequer; for every one
knew that in reality they were the same. (Hear, hear.)
The committee had presented their views. Their opinions
might, as the right hon. gentleman had said, be utterly un-
worthy of the notice of the house, but they had only done
their duty in recording their view as to the propriety of
continuing the power at present vested in the Chancellor of
the Exchequer. The motion before the house, however,
was not of sufficient weight to be of much avail. It was a
mere resolution which no Chancellor of the Exchequer
would be compelled to act upon; and there could be no
doubt that the proper mode of effecting the proposed object
was by an Act of Parliament, in the debates upon which
,the whole matter might be fully discussed. It had always
appeared to him to be most objectionable to vest in the
Chancellor of the Exchequer the power of secretly, without
the cognisance of the public, and without that notoriety
which was essential for the credit of the country, trans-
ferring the unfunded debt into funded debt, thus throwing
a mass of funded debt upon the market without previous
notice. (Hear, hear.) Ile did not say that the transfer
from Exchequer-bills into Consols was an increase of the
debt of the country ; but it was an increase of one portion
of the debt without notification to the public, and it was
this which made it objectionable. Under the present sys-
tem the commissioners had authority whenever convenient
to fund Exchequer-bills, so that there was as it were a kind
of mill, into which Exchequer-bills being put came out
funded debt, and this went on round and round as long as
it suited the convenience of the Chancellor of the Exche-
quer. He had no doubt that the power was honestly and
conscientiously exercised by Chancellors of the Exchequer.
but he considered that it was one which could not
exist with safety to the credit of the country. (Hear, hear.)
Mr. GLADSTONE—The hon. gentleman opposite has
proposed a resolution to limit, in a particular point, the
powers of the Chancellor of the Exchequer as the guardian
of a very large mass of public money placed in his hands,
and to:provide that no funding of Exchequer-billsheld by the
Commissioners of Savings-banks be made without the special
authority of an Act of Parliament. The discussion which
I have heard leaves upon my mind the impression that,
whatever may be the merits of the particular transaction
under review, the reasons for adopting which have not as
yet been fully stated, the whole subject is one on which it
would be inexpedient for the house to come to any practical
conclusion, unless it were founded upon a more thorough
investigation of the subject than has yet taken place.
(Hear, hear.) It is quite plain that the powers of the Chan-
cellor of the Exchequer, as the keeper of the public money,
are enormous. I don't hesitate to say that, in my opinion,
they require review and reconsideration, and that in some
important particulars they ought to be limited. Undoubt-
edly, however, if there be any one point of special danger
to the public created by those powers, it is not that which
is raised by the motion of the hon. gentleman ; but it is the
power which the Finance Minister possesses of creating
new public debt by the funding of deficiency bills, or, in
other words, of meeting deficiencies in the revenue of the
country from year to year by the creation of new debt,
without the authority of Parliament. (Hear, hear.) That
is an enormous power, and it is not merely speculative in
its character ; but it is a power which has been used in a
manner highly detrimental to the public interest ; and
if the house is to go into the matter at all, it should direct
its atttention to that, which is by far the more serious
part of the subject. With regard to the more limited
question opened by the hon. gentleman opposite, I agree
that that also deserves the attention of Parliament, and that
the state of things at present established by law is not alto-
gether satisfactory. For the most part I concur in the
views and observations of the right hon. gentleman the
member for Radnorshire. At the same time, I think that
the house has not had sufficiently under its view the various
questions thit are involved in these great monetary trans-
actions of the Chancellorof the Exchequer. The Chancellor
of the Exchequer is the greatest banker in the country, and
I believe, also, that he is the greatest operator on the Stock-
Exchange in London. (Hear hear.) I don't enter upon
the question of whether that should be so or not. I believe
that it would be injurious to the public interest that you
should altogether deprive him of his power in this respect;
but undoubtedly he ought to act under rules and on prin-
ciples that have been maturely considered and deliberately
adopted by the House of Commons. (Hear, hear.) Instead
of that we have a system which has grown up from time
time in great degree by haphazard. The Chancellor of the
Exchequer is frequently in a difficulty to know how far he
is justified in using the powers with which the law invests
him, and it would be greatly for his advantage, as well as
for the satisfaction of the public, that it should be deter-
mined by the house in what manner, and on what prin-
ciples he was to procceed. But the chief object which Ihave
in rising is to notice what has been said by my hon. friend
behind me on the subject of savings-banks funds, because
we are at issue on a point which it ought not to be difficult
to settle. My hon. friend the member for Huntingdon
thinks tharthe funds in the hands of the Commissioners
of the National Debt are the funds of the depositors
in savings-banks. In my opinion there cannot be a more
gross delusion. (Ifear.)lThey are not the funds of the Com-
missioners of Savings-bunks any more than £5O remaining
in a banker's till belongs to me, if I happen to have depo •
sited £5O with him. It does not belong to me, it is his
money, to use it as he thinks fit, subject to its repayment to
me. To say that the depositors in savings-banks were to
place their money in the hands of
,a public body, and were
to be responsible for the prudent use or gross misuse of their
funds by that body, would be doing them anything but a
kindness. It would be impossible to lay down a rule that
would be more ruinous to the depositors themselves. What
do you do ? You take the money of these depositors and
you give them the entire security of the public for their
money. They cannot have a better security, and if you give
them that, they have no interest in the employment of the
one
tomisate
thethems
treasury if yo fling
theit tcootetry bot-
sound, thedoesn'tt
sea.
So long
sound, it does not matter one rush what the Chancellor of
the Exchequer does with the money. If he invests it well
they are no richer, and if he plays all the tricks of the
mountebank, or disposes of it with the artifices of the
swindler, they are none the poorer. The depositors in
savings-banks have nothing to do with the question, and it
is only weakening and impairing their
.position to make
them depend upon the prudence of the Minister instead of
upon the credit of the British public. (Hear.) Ido not en-
tirely follow the member for Radnorshire when he says
that there never can be an increase of the public debt
from a transaction such as that which recently occurred.
With regard to that transaction I give no opi-
nion. I know no more than he does the reasons which led
the Chancellor of the Exchequer to adopt it ; and
I only speak, therefore, of the general principle.
It does not appear but that there might be an increase of
the public debt under the exercise of this power by the
Chancellor of the Exchequer. If the Commissioners for
the Reduction of the Public Debt are the holders of
£1,000,000 in Exchequer-bills, and the Chancellor of the
Exchequer finds that £1,000,000 at a rate that will ex-
punge the assets of the commissioners to that amount,
replacing them by £1,100,000 of stock, the first impression
of the transaction is that it is a mere matter of account, and
that the public is neither more nor less indebted than before,
because the £1,100,000 is a portion of certain assets, the
property of the public themselves ; and if the public are, on
one hand,creditors, they are, on the other, debtors to that
amount. But contingently the transaction may add to the
public debt ; for whereas before, by means of the £1,000,100,
the Chancellor of the Exchequer might have gone into the
market, and, by selling that amount, made the public really
debtors to the buyers by £1,000,000, he has now the power
of going into the market and selling £1,100,000; therefore,
to the extent of the difference of £lOO,OOO, there might be
a creation of new debt by a transaction of this kind. I
would suggest whether it would not be useful, while leav-
ing the Chancellor of the Exchequer the powers he now
possesses, with regard to this exchange of securities, to
provide that all such transactions shall, as a matter of
course, be brought under the review of a committee of this
house. (Hear, hear.) Ido not pretend that this should
stand in the place of a consideration of further and fuller
measures on the subject ; but the house does entertain a
certain amount of jealousy of these operations; in the city
of London also the operations of the Chancellor of the
Exchequer are regarded with considerable jealousy, because
they interfere with the regular transactions in stock, and
the house would be exercising its constitutional juris-
diction if, by some special organ, it assumed a periodical
review of all operations of this kind. It is well worth the
consideration of the house whether it should not make some
provision that would prevent it depending on any indi-
vidual member inviting attention to the subject—whether
there should not be some regular and fixed machinery by
which operations of this kind could be brought under the
consideration of Parliament and regulated beforehand. It
would be dangerous to say that the Chancellor of the Ex-
chequer shall not exercise the power, because the advantage
of an operation might be lost by the necessity of making an.
application to Parliament; but it is quite another thing to
provide the means of a more rapid submission of the opera-
tion to the audit of the House of Commons.

Mr. W. WILLIAMS thought it was the duty of the
house not to allow the existing act to remain any longer on
the statute-book. He had never known a transaction of
this kind in which the public had not sustained a loss. He
hoped the hon. gentleman would withdraw his motion, and
bring in a bill._

M. HENLEY could not at all agree with his right hon.
friend that the savings bank depositors had nothing to do
with what became of their money. What the right hon.
gentleman said was quito true in so far as the principal was
concerned ; but they must remember that there was such a
thing as interest. The depositors complained that they did
not receive quite so much as they ought ; and the answer
was, that if the Government realised and paid them off, it
would lose by the transaction. That might be so ' • but
then the depositors had a right to ask, " How much have
you lost by jobbing ?" He (Mr. Henley) suspected that it
was in this sense that the committee had complained of the
commissioners buying Exchequer-bills at a discount.
The CHANCELLOR of the EXCHEQUER wished to
recal the attention of the house to the motion that was
really before it; and he would not therefore enter
into collateral subjects, which were no doubt interesting,
but which were not raised by the resolution. The notice
being to call attention to the late funding of Exchequer-
bills, for which he (Mr. Disraeli) was responsible, and
which had taken place by his advice, he could not but re-
gard it, notwithstanding the hon. gentleman's courteous
expressions, as a vote of censure upon the operation ; for it
was in consequence of that operation that the house was
called upon to legislate, and of course to legislate in the way
of censure. He (Mr. Disraeli) had been asked why ;the
Government had taken the step of funding £7,600/000, and
he would now tell the house the reason. In the course of
the autumn his attention had been called to the subject by
a complaint on the part of the Commissioners of Savings
Banks, to the effect that the security they held was a losing
one, and that they were I;iet receiving the interest that they

' would have done wider another form of investment. It
might be said that the Chancellor of the Exchequer and
the Commissioners of the National Debt were but a single
person, and that this was a fiction used in discussion. But
in fact that was not so. There were two accounts ; there
was the account of the savings-banks, and there was the
general account of the country. Of course those who were
responsible for that account did not wish to see a loss appa-
rently under their management regularly accruing upon
the savings-banks, and therefore they naturally wished to
put an end to what had a very ugly aspect, and for which
they were responsible. Though that was one of the rea-
sons, he candidly admitted that that was not the reason
which had induced him to sanction this operation. His
attention was called to the large amount of Exchequer-bills
then in existence, and to that of which nobody could be
insensible, the very delicate state of the Exchequer-bill
market, and he was asked to consider what might be the
effect of having so large an amount of Exchequer Bills, not
afloat, but in existence, and what consequences of great in-
convenience and injury might possibly accrue from those
circumstances. He naturally inquired what was the reason
why the Savings Bank Commissioners were in possession of
so large an amount of Exchequer Bills as between seven and
eight millions sterling. Perhaps the house would like to
know that that was not a natural or usual state of things,
and how very rapidly that amount had accrued. At the close
of 1854, the commissioners had only £200,000 of Exchequer
Bills. It was true they had £1,600,000 of Exchequer Bonds,
making altogether of the unfunded debt in their possession,
£1,800,000. On the sth July, 1855, between bills and bonds,
the amount had reached £3,315,000. At the close of 1855,
it was £4,886,000, and on the sth July, 1856, £6,875,000.
He found the amount between seven and eight millions ;
and it appeared to him that this was a very dangerous state
to be placed in, the Exchequer Bill market being a very
delicate market, and naturally so, from the very unsatis-
factory state of that security. Suppose these securities,
which were periodically paid off, had become liable to be paid
at a moment when there was a great scarcity of money ;
suppose there had been such a state of affairs as suddenly
occurred in 1857 for example—the minister insisted on going
to the savings banks, and finding that they had a very large
amount of capital in the funds to assist him, would have
found that their resources were entirely absorbed and clogged
up by themselves holding seven or eight millions of Ex-
chequer Bills. This was very unsatisfactory not only to the
Chancellor of the Exchequer, but to the Commissioners of
Savings Banks themselves. It was thought necessary, and it
was not done hastilyto sanction a change whichwould put an
end to that system. Mr. Baring had talked of needy Chancel-
lors of the Exchequer availing themselves of these securities
for their own benefit ; but in this instance the change mats
made for the benefit of the savings banks themselves ; for
they received, in lieu of a security which they viewed with
distrust and suspicion, one with which everybody was satis-
fied. That was the real reason which had prevailed upon him
to sanction the funding of this large amount of Exchequer
Bills held for the savings-banks ; and he believed that the
course was one very much for the advantage of the savings
banks, and one in which the government itself was really
not at all interested. Because, so far as the prices of
Exchequer Bills floating on the market was con-
cerned, this £7,800,000 could not at all affect them. They
were in possession, practically, of the Government; and he
had to ask himself how they came into the possession of the
Government. He was obliged to look at the circumstances
which had led to this rapid increase in the hands of the
Savings Banks Commissioners ; and it appeared that those
circumstances had arisen in a very legitimate and proper
manner. They had arisen in consequence of a very excep-
tional and extraordinary event—the occurrence of a war,
in which that house voted Exchequer-bills, in order that
the minister of the day might raise money on them to carry
on the war. He looked upon the funding of these Exche-
quer-bills as virtually the completion of that transaction.
He had no hesitation in using the phrase of gentlemen op-
posite ; no doubt, it was virtually the completion of a loan
which the country had incurred to carry on the war. But
it was completed in a legal manner—in a manner perfectly
satisfactory to the Commissioners of Savings • banks. And
it was really of no advantage whatever to the Government
beyond that advantage which must always accrue when
funds of this kind were in a satisfactory and healthy con-
dition. That was the real reason why this funding had
taken place ; and he believed that it was an operation ne-
cessary and advantageous, and strictly in consonance with
the law of the country. He deprecated the motion being
passed. The subject would not be dealt with at all satisfac-
torily by acceding to the motion ; but he was perfectly will-
ing to admit, as he had done before, that the state of our
unfunded debt was not by any means satisfactory. He did
not think that the instrument of security itself—the Exche-
quer-bill—was an instrument adapted as much as it ought to
be to the times in which we lived. The shortness of its date,
the possibility of its becoming due to a large amount when
there was a great strain upon the money market, or even
a panic in the public mind, were circumstances highly dis-
advantageous ; and it was quite possible that the wisdom
the Administration and Parliament might some day or other
substitute some instrument to represent our unfunded fdebt
more effective than the form which at present existed. The
whole subject of Exchequer-bills was and had been for
some time under the consideration of the Government. With
respect to the recommendations contained in the report of
the committee on public monies, he regretted that cir-
cumstances had prevented him from bringing all the recom-
mendations of that committee fully before the house; but
he hoped shortly to do so, and he should then be able to
speak more definitely on the subject of Exchequer-bills than
it was convenient for him now to do. He hoped that the
house would not sanction the motion. He was convinced
that the power entrusted to the Chancellor of the Exche-
quer had been exercised greatly to the public advantage,
and he should not be afraid of failing to establish that if
that were really the point at issue. The real point was the
recent funding of Exchequer-bills, the cause of that fund-
ing, and whether, in consequence of that funding, the house
ought to interfere by legislation to express its disapproba-
tion thereof. He had detailed the main reasons which in-
fluenced him in that course. He had not in the least con-
sidered the convenience of the Government, but solely what
he thought was due to the condition of the savings banks
themselves. He believed that it was a necessary operation;
he know it was legal ; and he trusted that the house would
not, by passing this resolution, express disapprobation of
it.

ration, formed of the incumbent and churchwardens, to
hold and administer property appropriated to the Church ;
and of transferring the powers of the present vestry with
reference to the parish church to a new vestry, consisting of
contributors to the Church funds, the churchwardens to be
chosen therefrom. He stated reasons why, in his opinion,
the abolition of church rates must form the main ingredient
of any measure on this subject, and he proceeded to discuss
the resolutions seriatim. Those who desired to see the set-
tlement of this painful question should, he said, provide
some reasonable machinery that would enable Churchmen
to bear the burden that would be cast upon them, and
thereby secure the passage of the bill in another place.
Mr. S. ESTCOURT suggested to Sir A. Elton that, in
the existing circumstances of this question, having detailed
his views, he would do better to withdraw the resolutions.
Mr. COWPER concurred in this §uggestion, thinking
that no useful object would be gained by the motion.
After a few words from Mr. NEWDEGATE, the mo-
tion was withdrawn.
NEWFOUNDLAND FISHERIES.

LordBURY called attention to the Newfoundland fisheries,
and moved an address to her Majesty for copies of any corres-
pondence between the English and French authorities in
Newfoundland, or between the Governor of Newfoundland
and the Secretary of State for the Colonies, or between
the English and French Governments, which may show
the construction placed by the French authorities upon the
treaties which now regulate the Newfoundland Fisheries.
He admitted that this was a delicate subject, involving
questions of international law, in which we were at issue
with an ally, and which should not be discussed in an angry
spirit. His only object was, he said, to ventilate the sub-
ject in the house. France had made great demands, which
had been met by great concessions, and he wished to know
on what principle the negotiations were based. He gave
an exposition of the treaties on the subject of fisheries, of
the titles which the French derived from them, and of the
claims they had put forward.
Sir E. B. LYTTON said,—l can assure the noble lord
that I highly appreciate the temper as well as the ability
which he has shown on this subject ; and, so far from wish-
ing that he had not interfered in the matter, I am, on the
contrary, glad to think that we may secure so able a do-
fender of the rights and interests of the colony of New-
foundland, of which I myself am, as it were, the profes-
sional advocate. The noble lord, I think, will see beforll
sit down that I am positively precluded from entering in
detail into this particular question. It is a subject to which
I have devoted great attention. It is one on which I have
formed a very decided opinion, but, as the noble lord has
truly stated, it is one that involves very subtle points of
argument and some serious ground of danger. I hope that
the disputes may be settled and the danger may be pre-
vented by amicable negotiation. I will not follow the noble
lord through his able historical disquisition, but will simply
admit that it is perfectly true that for the last 30 years ne-
gotiations have been begun, have been dropped, and have
been resumed with the French, with regard to their alleged
right of fishery in Newfoundland. The late Government,
believing that a mutual understanding between the French
and the English Governments as to their respective rights
could not be arrived at by negotiation, attempted a kind
of compromise—viz., the convention of 1856, by which
we ceded a portion of our claims, and gained in return an
extension of our right of fishing on the coast of Labrador
and also a right to take bait. I cannot concur in the noble
lord's opinion that the right hon. gentleman opposite (Mr.
Labouchere) neglected British interests in this matter. The
Legislature of Newfoundland objected to that convention
and it fell to the ground. The noble lord spoke of the tra-
ditionary policy on which he imagines every Secretary of
State is to act ; but I must remind him that during the
ascendancy of that political party with which he is con-
nected, there were no less than eight successive Secretaries
for the Colonies in one single year. (Laughter.) If each
of those Secretaries of State had followed out a policy of his
own, you would have had eight traditionary policies for the
British colonies • and I would then ask the noble lord
whether he thinks that we should long have many colonies
left to us. I think the noble lord asked me whether I ap-
prove of the convention of 1856. I will venture to say that,
whether I approve or disapprove of what was done in that
year, I may assume that, if the right hon. gentleman the
member for Taunton were put now in office, he would not
make in 1859 the same propositions as he made in 1856,
partly because of the rejection of them by the Newfound-
land Legislature, and partly because further evidence on
the subject has been furnished to the Government. Hav-
ing considered that evidence. I have come to the conclusion
that the refusal of Newfoundland to concur in the conven-
tion was justified. When this convention was rejected by
the Legislature of Newfoundland, the French Government
expressed a determination to maintain its existing rights ;
they were summed up very briefly by the French authori-
ties ; they demanded the fulfilment of the treaty—nothing
more and nothing less. I can assure the noble lord I have
carefully examined this question in all its bearings; and
if the noble lord should himself be my successor in
the office of Secretary of State, and wish to
pursue a traditionary policy, he will have an opportunity
of examining my minutes, and I think he will be
startled by their extent. Her Majesty's Government in-
quired whether the Government of France was disposed to
re-enter into a consideration of the convention, in order to
ascertain what are the rights claimed by the French, and
the manner in which those rights have been exercised. We
have proposed the appointment of a mixed commission to
investigate the facts on the spot, and to inquire into the
manner in which the provisions of the treaty are observed
by both parties. Her Majesty's Government are of opinion
that restrictions have been imposed on French fishermen to
which, it is alleged, they ought not to be exposed ; so, on
the other hand, it believes there have been encroachments
and deviations from the treaty on the part of the French
fishermen, which the people of Newfoundland have ex-
pressed a determination to resist. Now, I must say the
French Government have replied to this proposal in a most
friendly spirit. The commission will be appointed, and
proceed to make its inquiry in the beginning of May. I
think I may venture to hope that all chance of a collision
between the two parties arising out of the state of affairs in
Newfoundland is over ; for it is understood on both sides,
that during the ensuing fishing season, and while inquiry
by the commission is in progress, the English and French
commanders are to exercise all necessary forbearance with
regard to any occurrence that may lead to a dispute ; and
all measures of repression on the part of the French Go-
vernment will be suspended. The Government of France,
in acceding to our proposal, at the same time expressed a
hope that its having done so would be accepted as a fresh
instance of the friendly and conciliatory spirit by which it
is actuated. And at this stage of the proceedings I trust
the noble lord will acknowledge that it is neither wise nor
prudent to publish papers bearing on the very points in dis-
pute, which we hope are about to be examined in a spirit of
friendly inquiry. There is no objection to publish the cor-
respondence, or extracts from the correspondence, that has
passed between the two Governments on this question of
the Newfoundland fisheries. But with regard to tke other
papers, I think, as we shall have the report of the commis-
sioners themselves in a few months, that will be the natural
time to produce them, without the intervention of Parlia-
ment. This commission will, I hope, pave the way to a final
settlement of all the matters in dispute between both parties
to the negotiations.
Mr. LABOUCHERE said that as this question had been
a source of irritation between France and England for some
years, it was most desirable that there should be a satisfac-
tory arrangement. He did not understand from the right
hon. gentleman's remarks whether or not the commissioners
were to be empowered to conclude a convention, or whether
they were merely to inquire.
Sir E. B. LYTTON said the commissioners were merely
to inquire how the treaty provisions had been carried out
by both sides.
Mr. LABOUCHERE—Carried out?
Sir E. B. LYTTON—Or what breaches had been com-
mitted.
Mr LABOUCHERE thought that all that was pretty
well known already. Commissions had been appointed on
several occasions. There was one in 1848, one in 1850, and
one in 1851, and all these attempts to come to a settlement
of the disputes had entirely failed. The commissioner, Mr.
Merivale, was a man well able to deal with this subject.
He endeavoured to settle the matter without reference to
the colony, but that course was only taken on the condition
that any convention should not come into force until it had
been assented to by the Legislature of Newfoundland.
What took place? A convention was framed, and when it
went to Newfoundland the Legislature there did not assent
to it. Well, the French Government made no complaint on
that ground, and the Legislature of Newfoundland was
equally satisfied on that occasion. To go further into detail
on what then took place would be but wasting the time of
the house, and he was the less willing to do so because ne-
gotiations were now pending in the matter. He trusted that
his noble friend would be satisfied with the papers which
the right hon. baronet was willing to give him. His noble
friend had alluded to the system of bounties, which were
given both by the French and United States Governments,
He could not but think that his noble friend had much over-
estimated the effect of these bounties.

Mr. WILSON wished to call attention to two points. So
far from the market being in a perilous state at the time of
this transaction, Exchequer-bills were at a premium of 34f
to 371; so that there was nothing to justify any extraordinary
course. That course had boon taken on the 31st of January;
had the Government waited a few days they might have ob-
tained the sanction of Parliament. As the bills were vir-
tually in the hands of the Government where was the
necessity of funding them ? It was said the funding had
been made for the convenience of the Savings Bank Com-
missioners ; but the effect would be to increase the interest
to be provided for from £163,000 to £250,000. As the de-
positors in savings banks received a uniform rate of interest,
the sole question was whether this was a good bargain for
the Exchequer. The great objection to the proceeding was
that by converting unfunded into funded debt, it was taken
out of the province of Parliament, and the Chancellor of
the Exchequer lost the power of taking advantage of the
varying rate of interest in renewing his Exchequer-bills.
It was said that the amount of Exchequer-bills was very
large—twenty millions—at the time of this operation; but
the average amount of late years had been eighteen millions.
Mr. HANKEY said that the house had had the advan-
tage of hearing different opinions from three Chancellors of
the Exchequer. He would not press the motion.
The motion was then withdrawn.
MILITARY ORGANISATION.

Captain VIVIAN moved fora select committee to in-
quire into the effects of the alterations in military organisa-
tion regarding the War-office and Board of Ordnance made
in the year 1855, and also to inquire whether any changes
are required to secure the utmost efficiency and economy in
the administration of military affairs. Considering the
amount of our military expenditure, it was important, he
observed, to see that this large item was economically as
well as efficiently expended. He would point out one
or two defects. There was a central register for
letters, which seriously impeded their delivery at the
proper branch. About 1,200 letters a day reached
the office. When referred to the proper branch,
the junior clerk made his minute on a letter, and so
on through half-a-dozen grades, until it came to the Secre-
tary of War ; one writing, " I approve"—another, " I agree,"
and so on. (Laughter.) This showed pretty clearly what
“circumlocution" meant. Recently a requisition was made
for some oats for the Cape ; one clerk thought they ought
to go in sacks, another in tubs, another in barrels ; and
ultimately the question was referred to Sir Benjamin Hawes,
who decided in favour of sacks. (Laughter.) Meantime the
requisition itself was forgotten, and the oats did not reach
the Cape until after a delay of six months. (Hear, hear.)
Looking at the danger which at present existed of peace
being disturbed, he trusted that we should not again wit-
ness the humiliating spectacle of a splendid army being
sacrificed by the neglect of ordinary precautions ; and the
Minister who should succeed in placing our military organi-
sation on a satisfactory footing would entitle himself to the
lasting gratitude of the country. (Hear, hear.)
General PEEL said that he did not intend to oppose the
motion which his hon. and gallant friend introduced with
his usual moderation and temper. (Hear, hear.) There was
nothing in the motion or the speech-of his hon. and gallant
friend to lead him to suppose that there was any intention on
his part to cast censure or to express want of confidence in
the heads of the two departments to which the motion re-
ferred. (Hear, hear.) It was net brought forward in a
party spirit—(hear, hear)--and, indeed, the organisation of
the military departments of the country was too much a
matter of importance to be made the subject of party dis-
cussion. (Hear, hear.) The object of the motion was to in-
quire, not whether the system was duly administered, but
whether it admitted of any improvement. To that he had no
objection, and could have no objection. Improvements might
be made and ho was actually carrying some out himself
at that moment. The motion of the present year was dif-
ferent from that of last year. He trusted that the object of
the motion was what it purported to be on the face of it—
that there was no intention of submitting the undoubted pre-
rogative of the Crown to a committee of the house, or of sub-
jecting the discipline and command of the army to any
greater control than what the house now possessed in the
presence of a responsible Minister, who was directly bound
to account for every shilling that was expended, and indi-
rectly responsible for the manner in which the duties of the
Commander-in-Chief were executed. As he wasnot going to
object to the motion of his hon. and gallant friend, he would
not enter into any of the details to which he alluded. In one
part of the speech of his hon. and gallant friend ho could not
agree. He could not agree in the opinion that the prestige
of the British army had deteriorated, nor that the system at
present existing was so defective as ho seemed to suppose.
(Hear.) His hon. and gallant friend should recollect that
the system which was in existence during the Crimean war
had been changed, and whatever further improvements
might be decided on by the committee he should be glad to
carry them into effect. (Hear, hear.)
Lord HOTHAM was glad that his right hon. and gallant
friend granted this committee, for there existed in the public
mind a wide-spread feeling that those advantages which it
was expected would follow from the consolidation of the
military departments had not yet been realised.
Sir DE L. EVANS agreed in what had been said by the
noble lord, that there was a feeling abroad which rendered
necessary the appointment of a committee, and thought that
the Government acted judiciously in granting it. The dis-
cipline and control of the army ought to rest with the mili-
tary Commander-in-Chief, but there was also a question
of patronage which he believed lay at the bottom of
many complaints, and which ought to be inquired into.
(Hear.) If the responsible Minister had no control in this
respect they could not well hold him responsible. He hoped
the committee would remedy the evil, but if it was not well
selected and competent evidence produced, it would end in
moonshine

Mr. M. GIBSON said the difficulty which defeated the
last convention was, that the Newfoundland local LegislaL
ture had not been previously consulted, and he censured
such a course of proceeding on the part of the Imperial Go-
vernment. He hoped that, whatever treaty was come to,
nothing would be conceded without a proper equivalent,
and a full communication with all parties concerned, and
that no rights of British subjects in Newfoundland would
be ceded to any foreign Power whatever.
Mr. WYLD thought that if a mixed commission were
appointed, one member ought to be nominated on behalf of
the Newfoundland Legislature. _ _

Lord BURY replied. He was anxious to know whether
the persons having property along the shores of Newfound-
land, proposed to be ceded to France, were to be compen-
sated. He should also like to know what were to be the
powers of the commissioners now proposed to be appointed.
Mr. LABOUCHERE explained that the treaty which
fell through did not propose to cede a single acre of the
shore. It merely dealt with rights of fishing.
Mr. S. FITZGERALD could assure the house that the
right hon. gentleman (Mr. Labouchere) had shown no de-
sire whatever to sacrifice the interests or to interfere
with the rights of the inhabitants of N-ewfoundland without
the assent of the local Legislature. In answer to the noble
lord's question he had to state that commissioners had been
appointed on both sides to inquire, but with strict injunctions
not to enter into any engagements for the future. They would
also have the assistance of the Legislature of Newfoundland.
Sir H. VERNEY thought that the house was much in-
debted to the noble lord who had brought the subject for-
ward. To causes similar to those to which the noble lord
called attention we had to attribute the loss of 500 miles of
coast known as Russian-America, of the Island of Java, and
various other places, which might have been preserved but
for the negligence of which the noble lord so justly com-
plained.
Motion withdrawn.
HUDSON'S BAY COMPANY.
Mr. C. FORTESCUE rose to move for an address for
copy of any correspondence between the Colonial-office and
the Hudson's Bay Company with reference to the charter
or to the licence of trade of that company since the 22nd of
February, 1858, being the date of the last returns upon
the subject. He thought it must be admitted that the
time was approaching when the information he called for
could be no longer withheld.
Sir E. B. LYTTON was understood to say that all tho
papers required were not as yet at the disposal of the Go-
vernment. When ready, there would be no objection to
their production.

Moiion withdrawn.
JEWS ACT.
On the motion of Mr. WALPOLE, the following Com-
mittee was nominated on the Jews Act :—Mr. T. Dun_
combo, Mr. Walpole, Lord J. Russell, Mr. Henley, Sir R.
Bethell, the Solicitor-General Sir J. Graham, Lord J.
Manners, Sir G. Grey, Lord Hotham, Mr. Byng, Mr.
Newdegate, Mr. Dillwyn, Mr. Adams, and Colonel W.
m tiotte e
with
Patten.
MARKETS (IRELAND) BILL.
This bill passed
through committee.
MUNICIPAL ELECTIONS BILL.
onthviesrbbal. amend.
bill.
Clauses lhaon.sheosuns op tthoelnowwenctro agreed
oceoemd
ments.
On clause 11,
Dire JAUNT proposed 434 axamhaeAt, to the effect that

Captain VIVIAN offered a few words in explanation to
the effect that his motion last year was intended to establish a
clear and well-defined distinction between the two depart-
ments.
Sir F. SMITH bore testimony to the advantage of having
an inspector of engineers.
The motion was then agreed to.
CHURCH RATES.
Sir A. ELTON moved a series of resolutions affirming
the expediency of discontinuing church rates, confiding the
maintenance of the fabric of the Church to the zeal and
Liberality of the clergy aid laity; of empowering a =Po'

" two justices of the county in which the ' borough is
situate" shall decide upon the matter, inste; ad of two
justices of .the borough. In many cases the justices in
boroughs wet 'e political partisans.
Mr. GILPLN did not think justices in boroughs were
more subject to ,Political influence than jut ;tires in counties.
Mr. SALISBI.7tY trusted the house would not sanction
an amendment the , effect of which would be to throw a re-
flection on the boron gh justices.
Mr. S. ESTCOUI tT thought it would be most objec-
tionable to throw on one set of justices duties 3 which ought
to be performed by it uother set.
The amendment 'as withdrawn, and the, clause was
agreed to, with an al nendment providing th sit the duty
should be performed by the justices sitting in pe; tty sessions.
Clause 12 was agreed to.
On clause 13, fixing the penalty for bribery- .at elections
at 405.,
Mr. DIVETT expresso,/ his opinion that ; the penalty
was inadequate to the olleme, and he would move that
the penalty be £5O.
Mr. CROSS remarked that if the penalty s hould befixed
at £5O the clause might as well be left out of Ihe bill. The
present penalty was £5O, and was so high that nobody
thought of putting it in force. The object of tb A 3 clause was
to make the penalty small but certain. Besid Ali the pecu-
niary penalty, the party offending would be disfranchised
for six years. The greater part of the persons .to whom the
penalty would apply were poor, and to ther n 40s. was s
serious sum. The rich would have to pay 40s. for every
person whom they might bribe.
Mr. S. ESTCOURT believed the smaller pcs laity would
best effect the object contemplated by the bill. He trusted
the committee would adhere to the penalty of 4 Os.
The committee then divided, when there apps tared—
For the amendment l3
Against it
Majority - —248
The clause was then agreed to.
Clauses 14 to 22 were agreed to, with some va rbal amend-
ments.

Mr. HADFIELD proposed to add a. clause r educing the
length of occupation before a burgess was enti tied to vote
from three years to one year.
Mr. CROSS opposed the clause proposed by the hon.
member for Sheffield, and regretted that an attA)mpt should
be made to insert provisions of that nature in a. bill which
had been introduced for a totally different purpose, and the
passing of which, in order to remedy a crying evil, should
not thus be imperilled. '
After a few words from Sir G. PECIiELL and Mr.
BERKELEY in support of the clause, the committee divided,
when there were—
For Mr. Hadfield's clause ... 97
Against it
M '

Majority ..-----90
Mr. W. J. FOX proposed the insertion of a clause to
repeal that provision of the existing act whicllt renders the
possession of a certain amount of property in real estate, or
being rated at a certain annual value, requisite qualifica-
tions for the office of mayor, alderman, or coun cillor of any
borough. He remarked that the house had wisely repealed
the property qualification for members of Parliament, and
he ziow asked them to do the same thing for municipalities.
It \yes desirable, no doubt, that persons of property should
be amongst the members of municipal corporations, and
should exert their due influence in local affairs ; but it was
laso desirable that the corporations should include men of
ability and character belonging to different classes of society.
It did sometimes happen that the interests of private p.ro-
perty were at variance with the interests of the community.
The wealthy alderman who resided in a suburban villamight
perhaps feel indifferent to questions of sewerage and sanitary
regulation, which would be matters of life and death to the
poor inhabitants of the closer and more crowded districts of
the town, and cases had even been known in which the
inspectors and officers of health were afraid fa lay an infor-
mation against some wretched cottages or other dangerous
nuisance, because the owners of those builds igs were mem-
bers of the corporation, and they were their st irvants. It was
not, however, from the poorer classes themselves, nor wasit
from any ambitious demagogues who wanted to get into
municipal offices, that this demand for the repeal of the pro-
perty qualification now proceeded; but one co rporation after
another had petitioned the House of Commons to that effect
—the corporations of Rochdale, Oldham, and Sheffield had
lately done so, alai if the corporation of Leicester had not
actually petitioned, it had joined in expressing the same
desire. These corporations wanted to be allowed to avail
themselves of the talents and energy of men in every rank
of society who might be found willing aad competent to
serve the borough, and whom the electors might think fit
to be chosen. _ _

Mr. CROSS said the bill had been drawn with a special
object, that of preventing bribery and corruptic )n at munici-
pal elections, and he thought ii would be unwise to imperil
the measure by the insertion of a clause the t might give
rise to so much difference of opinion.

The committee divided— -
For the clause • • • . 108
Against it 181
[
Majority against ...---73
The clause was thus lost.

Mr. HADFIELD brought up a clause relieving dissen-
ters from the necessity of taking the oath not to use their
office to the prejudice of the Established Church.
Mr. CROSS repeated the answer he had given to the
previous proposal, and
The clause was negatived.
Mr. H. BERKELEY proposed a clause providing for
elections being taken by ballot. (Hear, hear.) He con
sidered that the arguments he had adduced on previous
occasions remained unanswered, and when he contrasted
the small talent of which he could boast with the great
ability with which he was opposed, he could not but attri-
bute his success to the goodness of his cause. (Cheers,
ironical and otherwise.) He could quote cases of intimida-
tion in municipal elections in every constituency in the
kingdom. ("Divide," "agree.") There was a case of a man
employed at a mill at Staleybridge--(Name, divide)—who
was employed there 20 years, and one morning he was told
he might go home, because he had voted for a candidate
to whom his employer was opposed. (Laughter, and
Divide.) That was the way the wrongs of the work-
ing classes were received by the house. (Oh, and
Divide.) He had before him 13 cases of persons
brought to ruin in that way. He would read them, if they
liked. (Oh, and laughter.) He could bring cases of that sort
from every corporate town in England. The only protection
against this was secret voting, and as he should bring the
subject of voting by ballot for members of Parliament be-
fore the house this session he should leave the matter now
in the hands of the house.
Mr. A. STEUART asked if the clause could be now en-
tertained.
Mr. FITZROY said that the clause would be incon-
sistent with the 16th clause, which had been agreed to.
Mr. BERKELEY would then move his clause on the
report.
The house then resnmed.
LAW OF PROPERTY AND TRUSTEES RELIEF