UNIVERSITY OF ■-JNOIS LIBRARY 3ANA-CHAMPAIGN ON FINANCIAL REFORM. BY Sir HENRY PARNELL, Bart., M.P. LONDON: JOHN MURRAY, ALBEMARLE STREET. MDCCCXXX. PRINTED BY W. CLOWES, Stamford- street. CONTENTS. Chapter I. Page TAXATION 1 National Income - ' - - 16 Chapter II. TAXES ON RAW MATERIALS 24 Hemp - 29 Ashes and Barilla - ib. Thrown Silk - 30 Timber -■-'--- 31 Bricks and Tiles ... 32 Hides and Skins - ib. Coals - - » ib. Tallow and Soap - 33 Chapter III. TAXES ON MANUFACTURES 35 Paper Manufacture - - - - 37 Glass ditto -.-"." 38 Printed Calicoes - 40 Malt ib. Machinery - - - - 42 A2 IV CONTENTS. Chapter IV. Page TAXES ON LUXURIES . . - 43 Effects of Excessive Taxation - - 44 Foreign Spirits - - - - 46 Tea 47 Tobacco - - - - - 49 French Wines - - - - - 50 Almonds. Currants. Raisins - - 51 Effect of reducing Taxes - - - 52 Tea ----- ib. Coffee - - - - 53 Irish Spirits - - - - ib. Scotch ditto ^ French Wines - - - - 54 Glass ib. Smuggling 55 Duties to be reduced - - - 58 Repayment of Duties - - - 65 Chapter V. TAXES FOR PROTECTING AGRICULTURE 68 Chapter VI. TAXES FOR PROTECTING MANUFACTURES 72 History of - - - - - 76 Diminish National Wealth - - 79 Diminish Manufactures - 80 Increase Prices - - - - 81 Of no Benefit to Manufacturers - - ib. Encourage inferior Goods - - - 82 Foreign Competition - - 83 CONTENTS. V Chapter VII. EFFECT OF REPEALING TAXES IN MAKING OTHERS MORE PRODUCTIVE - - 97 Chapter VIII. RETRENCHMENT - - - 102 Chapter IX. COLLECTION OF THE REVENUE - - 122 Customs ----- 124 Excise - - . 125 Hackney-Coaches and Pedlars - - 128 Chapter X. BOUNTIES 130 Chapter XL MANAGEMENT OF THE PUBLIC EXPENDI- TURE - - - - - 136 Treasury - - - - 137 Exchequer - - - - -138 The Audit Office ... - 139 Management of the Debt - - - ib. Civil Departments of the Army - - 140 Paymaster of the Forces - - - ib. Comptrollers of Army Accounts - - 141 Army Extraordinaries - - - 142 Commissariat - 145 Army Agents - - - - 147 Army Accounts - - - - 149 Civil Departments of the Navy - - 150 Treasurer of the Navy - - ib* Navy Board - - - 152 VI CONTENTS. Page Dock- Yards - - - - 154 Navy Accounts - - - 161 Paymaster of Marines - - - 167 Victualling Office - - - - 168 Manufactures - - - - 169 Accounts of the Victualling Office - - 1 74 Civil Departments of the Ordnance - - 175 Woolwich Academy - - - - - 177 Ordnance Accounts - - - - - 1 78 Public Accounts - - - 183 Chapter XII. CIVIL GOVERNMENT 200 Lord-Lieutenant of Ireland - - 203 Salaries and Superannuations - - 204 Chapter XIII. MILITARY EXPENDITURE 212 Army Expenditure - - - 219 Navy Expenditure - 223 Ordnance Expenditure - 227 Chapter XIV. SLAVE TRADE. FOUR PER CENT. STOCK. SINKING FUND - - - - 231 Chapter XV. COLONIES 234 Chapter XVI. IRELAND 258 CONTENTS. VU Page Chapter XVII. SUMMARY OF RETRENCHMENT - - 263 Chapter XVIII. NEW TAXES 2G6 Chapter XIX. THE NATIONAL DEBT - - - - 270 Chapter XX. FUTURE WAR EXPENDITURE - 281 Chapter XXI. LOANS IN NOMINAL CAPITAL - - 289 Chapter XXII. TERMINABLE ANNUITIES ... 299 Chapter XXIII. ACCUMULATION OF CAPITAL - - 304 ERRATA. Page 223, line 19, for " 102,267," read "95,000." Same page and line, for " 15,000," read " at least 9,000. ; FINANCIAL REFORM. CHAPTER I. TAXATION. Although it may be impossible to relieve industry from all those taxes which are in- jurious to it, no attempt can be made towards accomplishing this object, without producing a great public benefit ; and as, perhaps, the general distaste for close and accurate reasoning respecting the effects of taxation, may have led to exaggerated no- tions of the difficulty attending the under- taking, no one ought to feel discouraged from making the attempt to shew, — if, after a full consideration of the subject, he thinks he can do so, — that many taxes might be re- pealed and many reduced, without any risk 2 TAXATION. of not securing a sufficient revenue for all the services of the state. But on entering upon a discussion, having this object in view, it is necessary to make some preliminary remarks on Taxation in general, for the purpose of explaining the circumstances which enable a country to bear a heavy amount of taxes, without being prevented from progressively be- coming more industrious, more rich, and more powerful. It would appear that the pressure of the taxes is too commonly estimated with re- ference only to the total amount of revenue w 7 hich is levied by thenr, without duly con- sidering the amount of the national income, consisting of the incomes of all classes of the community out of which the taxes are paid. But this is a very erroneous way of forming conclusions, with respect to the degree in which the taxes affect the public. For if the income of the country has been goieg on increasing in a greater proportion than taxation has been increased, the pressure of it will be less, though its amount may be TAXATION. 3 double or treble what it formerly was. So also, if the national income shall continue to go on increasing, taxation may be still considerably increased, beyond what it is now, without any real increase of burden on the community. There is another circumstance connected with the question of the degree in which the taxes are oppressive, which is seldom noticed, namely, the different effects pro- duced by different kinds of taxes. As it is clear, that security and good order are productive of universal advantage, and that without them there would not be any consi- derable accumulation of wealth, no indivi- dual can justly complain, that he is made to contribute, in the same proportion to his means as others, for their attainment ; but in selecting the taxes, a great deal of injury may be done to individuals, and to the public at large. If taxes fall on industry, tbat is, on raw materials, on manufac- tures, on food, or on the profits of capital, they diminish the employment of capital and labour, and check the accumulation of B 2 4 TAXATION. new capital. But if taxes fall on persons not in business, who have incomes derived from the rent of land, tithes, dividends on stock, interest on mortgages, salaries under government, and other incomes of the same kind, industry is not injured by such taxes, and the country may go on paying them without any impediment to her becoming richer and richer. So that, before a correct opinion can be formed of the actual effects of taxation, it is necessary to examine and make a distinction, between the portion of taxes which falls on industry, and that which does not. There is still another circumstance to be mentioned, as connected with the pressure of taxation, which is not often taken into consideration, — namely, the effect of mo- nopolies and protections, in raising the prices of the numerous commodities which are the subjects of them. These monopo- lies and protections impose, by increased prices, burdens on the public, not for any purpose of common utility or national advan- tage, but to support some favoured trades. TAXATION. O If the effect of the corn laws is, at least, to raise the price of corn five shillings a quar- ter, this advance on the quantity annually consumed, taken at 50,000,000 quarters, creates a charge on the public of 12,500,000/. a-year. If the protecting duties on East Indian and foreign sugars advance the price of sugar only one penny a pound, this advance on the quantity annually consumed, namely, 380,000,000 pounds, is a tax on the public of 1,500,000/. a-year. If the East India Company's monopoly makes the price of tea (exclusive of duty) double what it is at New York and Hamburgh, as is the case, it imposes a tax of at least 2,000,000/. a-year in the form of increased price ; and the monopoly of the timber trade enjoyed by the ship-owners and Canada merchants, costs the public at least 1,000,000/. a-year; so that by these monopolies and protec- tions, 17,000,000/. a-year are taken from the pockets of the people, just as if corn, sugar, tea, and timber, were taxed to that amount, and the produce paid into the Exchequer. These monopolies and protections press on 6 TAXATION. the resources of the country, exactly in the same way as a similar amount of taxation, and thus make the taxes appear to be much more burdensome than they really are. It is because these circumstances are not duly attended to, that so much is heard of the suffering and injury that the taxes produce; of the ruin they have brought on our manufactures and commerce ; and of their having made it impossible for this country to embark in a new war, with- out encountering the greatest financial diffi- culties, and incurring the risk of bankruptcy. But these notions are only in part well- founded ; for, notwithstanding the very inju- rious effects of many of the taxes, taxation has not yet been carried to such an extent, as to place this country either in a declining or stationary state with respect to its agri- culture, manufactures, and commerce. This is a conclusion come to by reasoning on facts, that shew the continued accumula- tion of wealth, in defiance of all impedi- ments. It is a conclusion, in no degree originating in any preconceived theory ; nor TAXATION. / does it lose any of its claim to have confi- dence placed in it, by its being directly op- posed to the opinion of a number of persons, who maintain that the nation is in a declin- ing state ; because these persons wholly omit to sustain that opinion by any reason- ing whatever. They merely exclaim, Look at the national debt, the taxes, the distress of agriculture and manufactures ; but they forget that the country was in the highest state of prosperity in the years 1823, 1824, and 1825, with the same debt and taxes that now exist ; and that similar commer- cial distress to that which now prevails, is a matter of regular recurrence, and is as regularly followed by recovery, as soon as the disturbed proportion of supply and de- mand is restored, as it is sure to be, to its proper ratio. The history of this country shews that temporary interruptions have been constantly mistaken for symptoms of habitual decline ; and those persons who now maintain the country is in this state, in ignorance of this historical fact, are committing the same error which has been so often made and so often 8 TAXATION. exposed. It has been remarked, that the English are more inclined than any other nation to view the dark side of the prospect, to fear every thing, and hope for nothing. Whenever the manufacturers suffer a reduc- tion in their profits, and landlords find a dif- ficulty in obtaining their rents, distress is universally proclaimed, and every one con- cludes the country is undone. Similar desponding apprehensions have been publicly avowed at different times, by persons of respectable authority in other re- spects, in the course of the last hundred and thirty years, during which period the nation has been continually making progress in happiness and prosperity. Dr. Davenant, in describing the state of public affairs in ] 699, says, " our gold and silver will be car- ried off by degrees ; rents will fall ; wool will sink in its price ; our stock of ships will be diminished ; farm houses will go to ruin ; in- dustry will decay ; and we shall have upon us all the visible marks of a declining peo- ple."* In 1736 the Craftsman says, " the » Essay on the Balance of Trade. TAXATION. y vast load of debt under which the nation groans is the source of all those calamities and gloomy prospects of which we have so much reason to complain : to this has been owing that multiplicity of taxes, which have more than doubled the price of the com- mon necessaries of life, and thereby dis- tressed the poor labourer and manufacturer ; disabled the farmer to pay his rent ; and put even gentlemen of plentiful estates under the greatest difficulty*." Dr. Chalmers, in de- scribing the state of the country in 1775, says, " yet prosperous as our affairs had been during the short peace of 1763, they were represented by an analogous spirit to that of 1738, either of designing faction or of interested folly, as in an alarming situa- tion. The state of things, it was said, is approaching to an awful crisis. The navi- gation and commerce by which we rose to power and opulence are much on the decline; our taxes are numerous and heavy ; an enor- mous national debt threatens the ruin of * No. 502. 14th Feb. 1736. 10 TAXATION. public credit ; our labouring poor are forced by hard necessity to seek that comfortable subsistence in distant colonies which their in- dustry at home cannot procure them *." It would not be difficult to make many addi- tions to the above extracts, were it necessary to adduce further proof that ill-founded ap- prehensions have led to repeated errors in considering temporary defalcations as infal- lible symptoms of a fatal decline f. But at the same time it must be confessed that, while there is no reason for placing any reliance on the predictions which are now so confidently made of approaching and inevitable decline, the preservation of what we have acquired, and the future progress of public prosperity, are subjects entitled to inspire deep and con- stant anxiety. With respect to the evils which the taxes occasion, the true state of the case is, that * Estimate, p. 153. f See Sir John Sinclair's History of the Revenue, Ap- pendix, vol. ii., p. 51., in which extracts are given from twenty-two authors, to shew that the nation was actually undone at different periods between 1688 and 1783. TAXATION. 11 certain of them, which fall on raw materials and manufactures, and others which are car- ried to an excess on some of the principal articles of consumption (together producing a revenue of about 11,000,000/.*) are as inju- rious as it is possible for taxes to be ; but that the rest of the taxes, which produce about 47,000,000/. f , are paid, for the most part, voluntarily, and out of the surplus of the incomes of individuals over and above what is requisite for purchasing the neces- saries of life ; and although they carry with them those general inconveniences and vexa- tions which are common to all taxes, they are not oppressive and destructive in the way they are commonly supposed by those persons to be, who, for want of sufficient * The taxes on raw materials yield 6,000,000/. a-year ; those on manufactures 2,000,000/., and that part of the revenue levied on tobacco and foreign spirits, which may be con- sidered as obtained by the duties on those articles being too high, and injurious to industry and trade, may be estimated at 3,000,000/. t The gross amount of the ordinary revenue is stated by the Committee of Finance to have been, in 1827, 58,700,000/. Fourth Report, p. 9. 12 TAXATION. examination into their real effect, imagine that all the taxes are equally injurious. So long as a revenue of 58,000,000/. must be raised for the public service, the above-mentioned large portion of it is ob- tained in a way but little liable to any real objections ; and if the remainder was pro- vided by taxes of the same kind, the whole revenue would be paid without any serious injury ; because, notwithstanding the large amount of the charge, the stock of national wealth is so great in proportion to it, as to be fully able to bear it. It is by reasoning in this manner, with reference to the relation between what is to be paid and the means of paying it, that the true state of the case with respect to the pressure of taxation can be best understood, and those errors avoided which are the grounds of the opinions on which it is maintained that the taxes cannot be paid without some change in the currency, or some other expedient *. * The administration of Lord Liverpool is entitled to the gratitude of the public for the ability and courage with which it undertook and accomplished the restoration of the TAXATION. 13 With respect to what are called our financial difficulties, and about which so much alarm is felt, they are not so much present as prospective difficulties. The Treasury easily finds means for paying all demands upon it ; and we may rest assured that, whatever the difficulties may be under which the country is at present placed, they may be made to yield to sound principles of legislation. With respect to prospective difficulties, the notion of them arises from apprehen- sions of the effects of a new war on our commercial and financial interests. The debt, which has been so little reduced during so long a course of peace, will, according to all that is known of the means by which ministers propose to manage the finances, rapidly accumulate on the recurrence of currency to its old standard. The nourishing state of the revenue, of trade, of manufactures, and of agriculture in the years 1823, 1824, and 1825, during- which Mr. Peel's bill was in full operation in bringing about the change, is a fact that completely exposes the error which those persons have fallen into, who attribute every modern public calamity to that measure. 14 TAXATION. another war ; and it is impossible for any one, at least who believes no better means can be devised, not to feel great uneasiness at the prospect of a very large addition of permanent taxes, for the purpose of paying the interest on new loans. But, in point of fact, there would be no ground for antici- pating any peculiar degree of embarrassment in the event of a war, if all was now done, that ought to be done, for conducting our financial affairs in a proper manner. If the unfunded debt was reduced to a few millions ; if the currency was secured by reforming the banking system ; and if the foundation was laid for imposing war -taxes as soon as a war should take place, there ought to be no greater difficulty in commencing and carrying on a new war, than has been ex- perienced on former occasions. But it is by no other means than by applying the most unremitting care and superintendence, directed on sound prin- ciples, to our finances, that they can be preserved from those difficulties in which already they are supposed to be involved. TAXATION. 15 With a skilful management of them, we may trust to the further increase of our pro- ductive industry for carrying us through new difficulties, in the same way that it enabled us to provide the expenses of the last war ; and if we remove the impediments with which bad laws still clog the activity and energy of individuals, we shall render productive industry even still more efficient than heretofore in creating new wealth. The want of attention to the principle of increasing productive industry to increase the sources of taxation, has led to much erroneous reasoning on the subject of taxa- tion. For nothing can be more certain, than that the amount of the produce of national industry taken by a government in the shape of taxes, may be regularly increased in every country in which the arts are progressive, without occasioning any additional burden to the people. Every new invention and discovery by which the production of commodities can be facilitated, and their value reduced, enables individuals to spare a larger quantity of them for the 16 TAXATION. use of the state. This shews that govern- ments have precisely the same interest as their subjects in facilitating production. Public wealth is merely a portion of private wealth transferred from individuals to go- vernment ; and the greater the wealth of individuals, the greater will be the magnitude of the portion they can conveniently spare for public purposes*. The amount of the income of Great Britain at the revolution has been commonly com- puted at 43 millions. Mr. Arthur Young, in his work on Political Arithmetic, published in 1776, computed the national income at 100 millionsf. Mr. Lowe says, in his work on the State of England, that the taxable income of it amounted, in 1793, to 125 millions ; and in 1806, to 170 millions J. Of late years, the general income of Great Britain has been computed at 300 millions§. Mr. Ricardo says, in his work on the Prin- * See the Supplement of the Encyclopaedia Britannica, vol. vi. p. 689. Article, " Taxation." t Sir John Sinclair's History of the Revenue, vol. i. p. 337. % Appendix, p. 32. § Sup. Enc. Br. vol. vi. p. 643 # TAXATION. 17 ciples of Political Economy, published in 1819, " Notwithstanding the immense ex- penditure of the English government during the last twenty years, there can be little doubt but that the increased production on the part of the people has more than com- pensated for it. The national capital has not merely been unimpaired, it has been greatly increased ; and the annual income of the people, even after the payment of their taxes, is probably greater at the pre- sent time than at any former period of our history. For the proof of this, we might refer to the increase of population — to the extension of agriculture — to the increase of shipping and manufactures — to the building of docks — to the opening of numerous canals, as well as to many other expensive under- takings, all denoting an immense increase both of capital and of annual production*." As ten years have elapsed since Mr. Ricardo wrote this opinion, and as similar proofs can be referred to, to shew a continued in- * Third Edition, p. 164. 18 TAXATION. crease of production, the conclusion is, that the national capital and income are now much greater than they were in 1819. The increase of a million a year in the rateable income of Lancashire, stated by Mr. Peel in the House of Commons to have taken place between 1815 and 1829, sustains this conclusion*. The following account of the consumption of the undermentioned articles, in the years 1790, 1815, 1827, and 1828, fully corrobo- rates all that has been just said with respect to the progressive increase of national wealth. 1790. 1815. 1827, or 1828 Cotton Wool . 31,400,000 lbs. 99,300,000 lbs. 249,700,000 lbs. Sheep's Wool 3,200,000 „ 14,900,000 „ 30,200,000 „ Raw Silk . 745,000 „ 1,400,000 „ 4,200,000 „ Tallow 225,000 cwt. 641,000 cwt 1,100,000 cwt. Flax . 237,000 „ 351,000 „ 876,000 „ Bricks and Tiles . 727,000,000 No. 1,381,000,000 No. Candles . 54,000,000 lbs. 117,000,000 lbs. Soap . . 45,000,000 „ 115,000,000 „* * Mirror of Parliament, June 12, 1829, p. 2099. f See Parliamentary Papers, Session 1829, No. 324. No. 50, No. 218, No. 211, No. 413, No. 321; andTookeon Prices, Appendix II. TAXATION. 19 As the quantities of the three last articles are not given in the Parliamentary Papers for 1815, the progressively increased consump- tion may be shown by the revenue received from the duties on them, these not having been altered. Revenue received — 1815. 1828. Bricks and Tiles - £265,000 £356,000 Soap - 678,000 1,210,754 Candles 294,000 497,000* As to our future prospects,, there is no reason to doubt that a continued augmenta- tion of capital will take place even in de- fiance of many obstructions. The same moral, physical, and external causes, which have contributed to the existing amount of national wealth, are still in operation. The free constitution of the government ; the exact administration of the laws ; the pro- tection afforded to foreigners ; and the tole- ration of all religions, will produce the same effects they have hitherto done. The im- proved manner of conducting business and * See Annual Finance Account for 1816 and 1829. C 2 20 TAXATION. speculations, among the higher mercantile and manufacturing classes, and the activity, perseverance, and increased knowledge of the working class, will cause their future efforts of industry to prosper. Our natural productions of iron, coal, and other articles of raw materials, will preserve our superi- ority in manufactures over other nations; while a reformed management of our foreign possessions, and a more enlarged system of free trade, will produce an extension of our markets. Whatever evils press just now on our manufactures, the more we exa- mine our situation, the more we shall find it possible to trace them to causes of a tem- porary character*. * The following statement appeared in the Northampton Mercury, early in November, 1829 : — " In reference to domestic affairs, it gives us infinite sa- tisfaction to be able to report the prospect of the state of trade, is become more and more cheering. The crisis of commercial distress is generally considered to be over by competent judges ; and a resumed activity is reported from most of the great manufacturing districts. From Liverpool, extensive transactions are reported in cotton wool ; and as might be expected, the accounts for the last few weeks are all confirmatory of activity in the cotton manufactures. At TAXATION. 21 Our improvements, whether in agricul- ture, manufactures, or foreign trade, are still very far from having arrived at a limit ; and no country possesses in its resources greater means of continuing in a career of ad- vancement. If, then, peace continues, there can be no doubt that the national capital and income will become much greater than they now are. The first effect of this will be to make the taxes so productive of revenue, as to allow of some of them being repealed ; but the main and most important effect will be, that the power of paying taxes will admit of the expenses of future wars being wholly defrayed by war taxes, so that no addition need be made to the national debt. If the progress of wealth be not interrupted, this is the state to which the country would certainly arrive, by continually becoming richer ; and as this would get rid of all dan- ger and difficulty about the national debt, Manchester, the silk warehouses have lately been completely cleared of their stock ; at Halifax there is a great demand for woollen cloths ; at Leeds all hands are employed ; and at Bradford, the accounts arc equally of a cheering nature." 22 TAXATION. the object of all our financial arrangements should be to remove every impediment in the way of the most rapid accumulation of capital and national wealth. No common considerations or apprehensions about the difficulty of making changes in our old sys- tem ought, therefore, to be allowed to pre- vent such a reform in our taxes, and such alterations in commercial regulations, as will relieve industry from all obstructions, and entirely do away those remains of mo- nopoly, which are still deeply engrafted in our commercial policy. The nature of the reform in the taxes which seems to be required, will be ex- plained in the following pages. The prin- ciple that will be held in view in suggesting each alteration, will be that of levying the revenue which is wanted for the public ser- vice, in such a manner as to occasion the smallest possible loss of money and enjoy- ments to the contributors, and the least possible impediment to the progress of national industry and national wealth ; at the same time, that full consideration will TAXATION. 23 be given to the great importance of mak- ing every change in so gradual a manner, that nothing may happen which might give a shock to trade, or reduce the revenue below what is requisite for all the public services. CHAPTER II. TAXES ON RAW MATERIALS. It appears, from an account laid before the House of Commons in the last session* (a copy of which is inserted in the Ap- pendix,) that the taxes on the materials of manufactures, buildings, ship-building, &c, produced in 1827 a net revenue of 6,191,956/. Although there is no proposition in finance the truth of which is more readily admitted, than that which affirms the impo- licy of taxing the materials of industry, there is, at the same time, so little appearance of a proper effort being made to modify or repeal this class of taxes, that nothing ap- pears to be more wanting than a full ex- * Par. Pap. Sess. 1S29, No. 172. See Appendix, No. I. RAW MATERIALS. 25 planation of their injurious operation on the employment of capital and labour, the accu- mulation of capital, and the increase of na- tional wealth. As the power of the manufacturing ca- pital of a country to purchase raw mate- rials is in proportion to their cheapness, and as the extent of manufactures is in pro- portion to the quantity of materials that are purchased, every particle of duty laid on them lessens the amount of industry and of annual productions. It consequently lessens the means of adding to the national capital, because these means consist of the surplus of the annual productions of the country. When, therefore, no less a sum is raised, every year, than 6,000,000/. on materials, it is manifest how great an injury this kind of taxation must do, by limiting manufac- turing and every other kind of industry. These taxes have also a very injurious effect in limiting navigation and foreign commerce ; for if there were no such taxes, the increased quantity of foreign materials that would be imported, and of finished 26 RAW MATERIALS. goods that would be exported to pay for these materials, would add considerably to both navigation and foreign commerce. The levying of so large a sum on articles that require capital and labour to give them utility and value, must strike every one as being a most serious obstacle in the way of remedying the evil, which presses at this moment the heaviest on the country, name- ly, the want of employment of the poor. The modifying, or wholly repealing, there- fore, of these taxes, is a measure particu- larly called for, under the present state of our manufactures, and of the labouring class ; provided it can be shewn, as it may be, that it can be carried into effect, with- out any difficulty,, in making good the re- venue which is now derived from these taxes. With respect to the foreign market for our manufactures, the taxes on materials produce an evil of the greatest magnitude ; for, by increasing the cost of production, they contribute to lessen the means our ma- nufactures have of carrying on a success- RAW MATERIALS. 27 ful competition with foreign manufacturers. Whatever may be the difference between one country and another, with respect to soil, climate, capital, wages, and machinery, the circumstance which leads to the exportation of manufactures, and makes it profitable, is the advantage in the smallness of the cost of producing them; every tax, therefore, on materials, by increasing the cost of pro- duction, lessens the means of carrying on competition with foreigners, and acts as a bounty on foreign manufactures, and is there- fore a tax of the most pernicious description. If all materials were free of duty, the consequence would be, that our woollens, cottons, silks, hardware, and other manufac- tures, might be sent to foreign markets two or three per cent, cheaper than at present ; and to those persons who have a due sense of mercantile profit, and of how little a turn one way or the other secures or loses a mar- ket, this will appear to be of the greatest im- portance. What, in point of fact, under the present circumstances of our manufactures, we have most cause to be alarmed at, is not 28 RAW MATERIALS. the depression of the home market, but fo- reign competition, in consequence of the pro- gress now making on the continent of Europe and in America in the improving and extend- ing of all kinds of manufactures. We shall do well, therefore, to look into the effects of taxation ; for if we continue to load our ma- nufacturers as they are now loaded, we may be assured that taxes will bring upon us the same result that they brought on Holland ; what these were is thus described in M. Luzac's work on the Wealth of Holland : — " Dautres examineront peut-etre si ces taxes ont ete judicieusement placees; si elles sont percues avec l'economie convenable. II suffit ici d'observer que les manufactures de laine, de soie, d'or, et d'argent, une foule d'autres ont succcmbe apres avoir lutte long- tems contre la progression de l'impot. La Hollande n'a sauve du naufrage de ses manu- factureS; que celles qui n' ont pas ete ex- posees a la concurrence des autres nations*." In order to leave nothing unsaid that can * La Richesse de la Hollande, vol. ii. p. 73. RAW MATERIALS. 29 be urged to produce a full conviction of the absolute necessity of revising the taxes on materials, some short remarks will now be made to draw attention to those particu- lar taxes which are the most inconsistent with sound principles, and the most injurious in their operation. The duty on hemp raises the prices of those kinds of linens which are in most uni- versal demand ; also the prices of sails and cordage. In this latter case it is quite in- consistent with those numerous legislative regulations which have been enacted for pro- tecting and encouraging the shipping in- terest. As the legislature, acting most wisely, has introduced a freer system of navigation, it is bound in common justice to the ship- ping interest to remove all duties on the materials of ship-building. The permission which has recently been given to British ships to buy foreign cordage, and bring it home free of duty, is an additional reason for taking off the duty on hemp. The duty on ashes and barilla adds to the 30 RAW MATERIALS. prices of the materials of several manufac- tures ; and even in the cases where a draw- back is allowed, the obtaining it is attended with expense and loss of time ; while, as is the case with all drawbacks, there is a waste of money, first, in the business of collecting the duty, then in that of repaying it, and often by frauds being practised in getting a drawback of greater amount than that of the duty which has been paid. The duty on thrown silk not only raises the price of the silk imported, but as long as any is imported, of all silks thrown at home ; because the price of the latter will always be as high as the price of the former, in con- sequence of its being impossible that two prices for the same article can exist in the same market. If thrown silk were made free of duty, the price would be reduced by the amount of the duty ; for our own throwsters, in order to secure a sale for their silk, would be obliged to introduce such improvements as would enable them to go into competition with free foreign thrown silks. If they could not make such improvements, and lower RAW MATERIALS. 31 their prices, then the silk manufacturers wouM be supplied by foreign silk ; but the progress which has of late been made in silk machinery makes it evident that this is an event by no means likely to happen if the duty on thrown silk were repealed. The duty on timber affects and injures industry in a great variety of ways, in con- sequence of its being so much used in build- ings, ships, machinery, &c. Countries pos- sessing forests in the vicinity of navigable rivers, enjoy great advantages in that respect over our ship-builders ; and to lay a duty upon timber is still further to increase those advantages. Instead of doing this it would appear as if it were an indispensable preli- minary to securing a permanently successful competition with foreign ship builders, to admit timber to be imported free of all duty. The present arrangement of the duties, namely, of 10?. a load on North American timber, and of 21. 15?. a load on European timber, forces, as it were, the use of the former kind, though of inferior quality. If, 32 RAW MATERIALS. in place of these duties, a duty of 1/. 15s. a load were imposed on all timber, the prices would be reduced 1/. a load, and the revenue would be very considerably increased. The duty on bricks and tiles falls heavily on industry, in consequence of the number and size of the buildings required for mills, fac- tories, store-houses, &c. It must obviously contribute to diminish the employment of capital and labour. The duty on hides and skins not only injures a very important manufacture, but raises the price of one of the necessaries of life. As leather is an article of universal demand, the repealing of the duty would have the effect of a considerable increase in the employment of capital and labour. The duty on coals and culm carried coast- ways needs only to be mentioned to obtain a general assent to the impolicy of continu- ing it. It would be an endless task to trace out all the ways in which this duty does injury : it will be sufficient to allude to the business of working coal-mines, making RAW MATERIALS. 33 machinery, building ships, bleaching, dyeing, and to the use of steam in so many pro- cesses of trade and manufactures. The exportation of coals is confined to between three and four hundred thousand tons a year, by the high duty of seventeen shillings a chaldron. If this were reduced, the exportation would be immensely in- creased, with great advantage to the reve- nue, and also to the owners of collieries and of ships, and to the labouring class. The duties on tallow and soap are ex- ceedingly injurious to manufactures, and have the same effects that all the other du- ties on materials have ; namely, that of de- ranging the natural course in which capital and labour would be employed, productions extended, and the wealth, comforts, and enjoyments of the community increased. It is impossible to repeat too often how much good the revising of the taxes on ma- terials would do. The evil of continuing them is so universally pernicious, that the commonplace excuse for it should have no weight; namely, that the circumstances of D 34 RAW MATERIALS. the country will not admit of a reduction of the revenue ; at least, until those circum- stances have been more fully investigated. No inquiry has as yet been made to ascer- tain whether means may not be found for providing for the public expenditure without the aid of this class of taxes, and therefore no plea of difficulty, with . respect to the re- venue, should be listened to, until it can be shewn, first, that the present scale of public expenditure will not admit of any reduction; and secondly, that no other taxes can be laid on of a less injurious kind than the ex- isting taxes on materials. CHAPTER III. TAXES ON MANUFACTURES. Contrary to every sound principle of trade, the manufactures of paper, glass, and printed calicoes have been selected as subjects of taxation. The following account shews the rates of duty which have been imposed, and the revenue obtained from them : — AN ACCOUNT of the Net Produce of the Excise Duties in the United Kingdom, as stated in the Finance Accounts for the Year 1827, on Glass, Paper, and Printed Calicoes, and shewing the several Rates of Duty. ARTICLES. NET PRODUCE. RATES OF DUTY. £ S. d. {Materials for flint glass - - 3 per lb. Ditto - plate - - - 3 -j Crown glass - - - - 3 13 6 I per Broad ditto - - - ■ 1 10 Of cwt. Green ditto - - - - 8 2 J {First class paper - - - 3 \ ,, Second ditto - - - - 1±J P erlb - Glazed paper, millb. and scaleb. 1 1 1 Pasteboard, 1st class - ■ 1 8 f Ditto, - 2d. ditto - - 14 J cvvt - f Foreign calicoes - - -0071 Printed-. 602,14116 U< British calicoes and muslins -0 3*> _?®* goods. J f Foreign calicoes - - -0071 H< British calicoes and muslins -0 3$ > > ler I Stained paper - - - -00 HJ var(l - £1,925,429 8 9* J. EWBANK, General Accomptant. Excise-Office, London, 17th Feb., 1829. D 2 36 TAXES ON As the extent of the market for these ma- nufactures, and consequently the extent of the employment of capital and labour in producing them, depends on their cheapness, these duties, by increasing prices, have a direct effect in limiting the market for them, and diminishing the employment of capital and labour. In addition to this, the neces- sarily severe and vexatious regulations un- der which these duties are collected, have most injurious consequences. By prescribing the processes of fabrica- tion, the manufacturer is not allowed to ma- nage his trade in the way his skill and expe- rience point out as the best ; but he is compelled to conform to such methods of pursuing his art as he finds taught in Acts of Parliament. Thus the unseen in- jury arising from excise taxation, by its interference with the free course of manu- facture, is much greater than is suspected by the public. The consequence of the ac- tivity and invention of the manufacturers being repressed is, that the consumers of their goods pay increased prices, not only MANUFACTURES. 37 for the duties imposed on them, but for the additional expense incurred by absurd and vexatious regulations ; and, in addition to this, goods are generally very inferior in quality to what they would be if no duties existed. The policy of the legislature in laying on the duties now under consideration, is in direct variance with that by which all other manufactures have been protected by high duties on foreign goods, and forms a strik- ing instance of the inconsistency and ab- surdity for which a great part of our pre- sent commercial code is distinguished. The duty on paper has an injurious effect on many other trades besides that of the paper-maker. The limited consumption which it occasions injures the makers of ma- chinery, type-founders, ink-makers, printers, engravers, booksellers, bookbinders, sta- tioners, paper-stainers, and several other trades. But the greatest evil of all is the high price of books which it gives rise to. By this a great obstacle is thrown in the way of the progress of knowledge, of use- 38 TAXES ON ful and necessary arts, and of sober and in- dustrious habits. By the use of books the productions of the human mind are carried over the whole world, and they may be truly called the raw materials of every kind of sci- ence and art, and of all social improvement. The duties on all kinds of glass manufac- tures are so high, that they necessarily have a most injurious effect in limiting the extent of the market for them, and thereby dimi- nishing the employment of capital and la- bour. The materials of glass are so abun- dant and cheap, and also the materials which are requisite for working up the glass ma- terials, that the taking off the duties would lead to an unlimited extension of this manu- facture ; for the use of a great number of ar- ticles, which is now confined to the richer classes, would become universal among the lower orders ; and no doubt there would be a great exportation of this manufacture to foreign countries. As in the case of the paper manufacture, a great many other trades are injured by the duties on glass besides the glass manufacturers. MANUFACTURES. 39 The following statement shews how much the high duties have kept down the con- sumption of glass. The quantities which paid duty for home consumption were — Flint and Plate Glass. Four years to 1793 - Duty, 21*. 5rf. per cwt. 190,000 cwts. „ to 1825* - „ 90*. „ V . .. \ 167,000 „ on Flint, and 60*. per cwt. as Plate - J Broad Glass. Four years to 1793 - Duty, 8*. per cwt. - - 90,000 cwts. „ to 1825 - „ 30*. ,, - - 34,000 „ Glass Bottles. Four years to 1793 - Duty, 4*. per cwt. - - 881,000 cwts. „ to 1825 - „ 8*. „ - - 697,000 „ Crown Glass. Four years to 1793 - Duty, 16*. Id. per cwt. 314,000 cwts. „ to 1825 - Duty, 73*. „ 450,000 „ t In 1828, 379,365/. of the gross duty received on glass (vis. 953,257/.) was re- * This year is taken, because in 1825 the duty on flint glass was reduced to 56*. Since 1825, there has been a considerable increase of flint glass ; but that of other kinds is not much altered. t This statement has heen made up from an account of the Excise Office, prepared for Parliament. See Appendix, No. II. 40 TAXES ON paid in drawbacks on exportation, being more than one-third of the whole duty. This is in itself a strong reason for repealing the duty ; for no system of taxation can be more unwise than that of incurring the ex- pense, and producing the vexation attending the collecting of so much money, with the re- sult to incur the additional expense of paying it back again, and to open a door to fraudu- lent claims of repayment. The perfect machinery used in the cotton manufacture admits of cotton goods being sold so cheap, that the duty on printed calicoes is not attended with any serious injury in limiting the market for them. The main objection to this duty arises from so large a part of the revenue that is produced by it, being repaid for drawbacks. In 1828, the gross revenue received was 2,019,737/., of which there was repaid 1,420,068/., leaving only 599,669/. of net revenue *. The duty of twenty shillings a quarter on * Parliamentary Papers, session 1829, No. 322. MANUFACTURES. 41 malt, is not one that can be justly objected to as being too high ; but the mode of charging it is conducted under such severe and vexatious regulations, as to render it extremely injurious to the agricultural in- terest, and the manufacturers of malt. " These regulations at one and the same time have the effect of unnecessarily fetter- ing the operations of the maltster — of dete- riorating the quality and adding to the price of his malt — and of putting him wholly in the power of the pettiest officer of excise*." In consequence of this system of collecting the duty, the consumption of malt has been stationary the last forty years. If the regu- lations were simplified, and the restrictions, which are occasioned by the present plan of licensing public houses, removed, there are the best reasons for concluding, that the sale of malt would be so much increased, * See Article IV. of the last number of the Edinburgh Review (vol. xlix. p. 373), for a very full and able exposition of the evils which arise from the present malt laws and licensing system. 42 TAXES ON MANUFACTURES. that a very large additional revenue would be the result. The manufacture of machinery is greatly injured by the prohibition to export it ; at the same time that the means of raising a considerable revenue, by a moderate duty upon it when exported, are thrown away. The superiority that England possesses over all other countries with respect to the materials of machinery, and skill in making it, is so great, that there can be no doubt that a very large quantity would be exported if the prohibition were taken off. Such a trade would give rise to increased employ- ment of capital and labour in working collieries and iron-mines, as well as in the making of machinery. CHAPTER IV. TAXES ON LUXURIES. In 1827, the net revenue received from the Customs' duties amounted to 17,894,409/., and from the Excise duties 18,438,707/.*, making together the sum of 36,333,116/. If from that sum be deducted the amount of the revenue received from the duties on the materials, 6,000,000/., and on the manu- factures, 2,000,000/., which have been under examination, and also 800,000/. re- ceived in 1827 from the duties on com, mak- ing together 8,800,000/., there will remain a revenue exceeding 27,000,000/., nearly- all levied on articles of luxury. As these articles are not used by the labouring class but to a limited amount, this revenue is paid by the wealthier classes, and the duties have little influence on wages and profits, * Fourth Report, Committee of Finance, Appendix, p. 1 13. 44 TAXES ON and consequently on national industry ; and were it not that some of the Custom duties have been raised too high, there would be no necessity for making any further remarks on this part of our taxation. As the effect of these high duties is in some cases to diminish the revenue, and in all to create smuggling ; and further, by greatly diminishing the importation of the articles on which they fall, to diminish the demand for, and the exportation of our own manufactures, they are exceedingly inju- rious, and ought to be reduced. There is an absolute limit to every duty, beyond which, an increase of it necessarily occasions a loss of revenue. In no instance is an increase of duty followed by an equal increase of revenue ; but, on the contrary, the progress of the increase of revenue will be less and less, according as the duty advances, until there is no increase of reve- nue, but a falling off. Yet, whenever it is proposed to lower any of the excessively high duties, it is immediately said, " The circumstances of the country are such,, that LUXURIES. 45 the revenue cannot admit of any reduction." But this sort of reasoning assumes that a loss of revenue is sure to happen, when, in point of fact, there is no foundation for any such conclusion ; for there is nothing more easy of demonstration, by reference to ex- perience, than that a diminution of taxation is not necessarily followed by a diminution of revenue ; or an increase of taxation, by an increase of revenue. " In the case of the commodities which, from the great expense of their production, are necessarily high priced, the consumption of them must be always comparatively limited, and therefore might not be greatly extended by any re- duction of the duties with which they are charged ; but the reduction of the duties laid on commodities of extensive demand, and whose natural cost is not very consider- able, must always be followed by a great increase of consumption ; for such a reduction not only enables those who were previously consumers of them to consume a greater quantity, but it brings them within the reach of new and numerous classes of consumers. 46 TAXES ON In this way, it is easy to perceive that such a reduction of the duty or price of any com- modity previously used by the higher classes only, as would permit it to be used by those of inferior station, would extend the consumption to a vast amount*." The truth of these observations is strongly exemplified by what has taken place with respect to the consumption of cotton goods ; it being now at least double what it was a few years ago, in consequence of the low price of those goods, brought about by the reduc- tion in the price of the raw material, and by the aid of machinery. The following instances of duties being increased completely confirm all that has ever been said concerning the impolicy of excessive taxation. The number of gallons of brandy and ge- neva imported for home consumption in four years to 1807, was 8,800,000, making an annual average of 2,200,000. f The duty * Edinburgh Review, vol. xxvi. p, 518. t These calculations are founded on a Parliamentary paper of the session of 1829, No. 340. See Appendix II. LUXURIES. 47 was then 14s. a gallon (wine measure). This rate of duty on the foregoing quantity- makes a revenue of 1,540,000/. In 1812, the duty was raised to 20s. Id. ; in 1813, to 20s. lid. ; and in 1814, it was fixed at 18s. \0d. a gallon ; and it has continued at that rate to the present time. The annual average number of gallons of brandy and geneva imported for home con- sumption in twelve years to 1829, has been 1,500,000; which quantity, at 18?. ]0d. a gallon, makes a revenue of 1,412,000/. So that the revenue is less, from a duty of 18s. \0d., by 128,000/. a year, than it was from a duty of 14s. a gallon. In the case of tea, the raising of the duty from 12 per cent., by successive augmenta- tions, to 96 per cent, in 1806, and after- wards to 100 per cent., has certainly been followed by an increase of revenue. But, though this cannot be disputed, there are the strongest possible reasons for believing that the revenue would have been considerably greater, had the duty not been carried so high. The quantity of tea sold by the East India 48 TAXES ON Company in 1799, was 24,853,000 lbs. ; and the quantity sold in 1827 was 26,043,223 * ; but as the population of the United Kingdom may be taken as having increased from 16,000,000 in 1820, to 25,000,000 in 1829, had there been no diminution of the in- dividual consumption of the Company's tea in the interval between these enumerations, their sales ought plainly to have been in- creased in the proportion of 16 to 25 ; that is, of 25 to 39, instead of in that of 25 mil- lions pounds to 26 millions pounds. But the fact is notorious, that no great diminution of individual consumption of tea has taken place, even after making a large allowance for the effect of the increased consumption of coffee in diminishing the consumption of tea ; and therefore we may conclude, that a very large quantity of tea now actually consumed is supplied by adul- teration. In proof of this, the numerous convictions of persons having adulterated tea in their possession may be referred to. * Fourth Report, Committee of Finance, p. 54. LUXURIES. 49 The effect of levying so high a duty as 3s. a lb. on tobacco in Ireland, is quite con- clusive in shewing the impolicy of excessive taxation. In four years to 1798, when the duty was 8c/. a lb., the quantity of tobacco entered for home consumption in Ireland was 3:2,000,000 lbs., making an annual average of 8,000,000 lbs. But, in four years, to 1829, the quantity imported for home consump- tion in Ireland has been only 16,000,000 lbs., making an annual average of 4,000,000 lbs., that is, half what it was thirty years ago, when the population was half as numerous as it now is. Had the individual consumption of tobacco that paid duty increased accord- ing to the increase of the population of Ire- land, the annual consumption should now be 16,000,000 lbs. instead of 4,000,000 lbs. As there can be no doubt that the individual consumption has increased in this ratio, the conclusion to be come to is, that full three- fourths of the tobacco now consumed in Ire- land is supplied by smuggling. The quan- tity of tobacco entered for home consump- E 50 TAXES ON tion in Great Britain has not increased in the last twenty years. The injurious effects of raising the duties on wine is very manifest in the instance of Ireland. In four years to 1796, the quan- tity of wines, of all sorts, imported for home consumption was 6,700,000 gallons, making an annual average of 1 ,675,000 gallons. The duty was 2s. Id. a gallon on French wines, and 1*. Id. a gallon on other wines. The re- venue received on an average of the same years was 150,000/. In the four years to 1829, the quantity imported for home con- sumption was 3,300,000 gallons, making an annual average of 825,000 gallons ; and the revenue received, from 6s. a gallon on French wines, and 4.?. a gallon on other wines, was, on the same average, 130,000/., being less by 20,000/. than the revenue re- ceived from the former low duties, In 1813, the duties on flint and plate glass were doubled ; they were raised from 49s. to 98s. a cwt. In four years to 1813, the average annual quantity for home consump- LUXURIES. 51 tion was 66,500 cwt. In the four years fol- lowing 1813, the annual average quantity was 30,000 cwt. * The duties on all other kinds of glass were doubled in the same year. The revenue received in the four years preceding 1813 was, on an average, 340,000/. ; that received in the three years following 1813 was, on an average, 395,000/., so that the doubling of the duties, instead of producing 340,000/., produced only 55,000/. Subsequent to the year 1808, the duties were raised on bitter almonds 7*. 9c/. per cwt.; on Jordan, 16s. 3d. a cwt. ; and on other sorts, 4?. 10c/. a cwt. The whole effect on the revenue was an increase from 16,319/. in 1808, to 17,991/. in 1827. At the same time the duties on currants were raised Is. 6c/. a cwt., with the effect of raising the revenue from 230,259/. in 1808, to 265,365/. in 1827. And the du- ties on the different kinds of raisins were raised, on some kinds, 2s. 3d., and on other kinds 4s. 2d. a cwt., with the effect of raising * See Appendix. No. II. E 2 52 TAXES ON the revenue from 159,000/. in 1808, to 160,000/. in 1827. The foregoing statement having shewn the effects of increasing duties, the follow- ing will explain what the effects have been of reductions of duty : — In 1745, the duty on tea was reduced from 4s. alb. to 1?. and 25 per cent.: but the revenue derived from it increased from 444,659/., the annual average amount for three years to 1745, to 804,791/., the an- nual average amount for three years to 1749*. The duty on tea was afterwards raised so as to be 119 per cent, in 1784, in that year it was reduced to 12 per cent. The consequence was, that the sales of tea at the India-house, which in three years to 1 784 were 17,164,966 lbs., rose, in three years to 1788, to 48,163,811 lbs. ; and instead of the duties falling off in the proportion of 119 to 12, that is, from 700,000/., which they yielded in 1783, to 73,000/. they only * Dr. Hamilton's Principles of Taxation, Appendix, No. XIX., and Sup. En. Br. vol. vi. p. 638. LUXURIES. 53 fell off in the proportion of 3 to 1, or from 700,000/. to 240,000/.* The duty on plantation coffee, previous to 1808, was 2s. per lb., and the annual average produce of it in three years to 1808, was 144,725/. This duty was afterwards reduced to 6d. per lb., and the annual average produce of it in three years to 1829 has been 378,350/. f The consumption has increased from 4,069,091 lbs. in 1808, to 16,522,423 lbs. in 1828J. The duty on spirits made in Ireland was reduced in 1823 from 5s. 6d. a gallon, to 2s. (wine measure). The number of gal- lons of spirits (imperial measure), that paid duty in 1822 was 2,328,387, and the reve- nue received was 797,518/. The number of gallons that paid duty in 1828 was 9,937,903, and the revenue was 1 ,395,721/.$ A similar reduction of duty took place at the same time, on spirits made in Scotland. The number of gallons have increased from 2,079,556 in 1822, to 5,716,180 in 1828; * Macpherson's Commerce of India, p. 210. t See Appendix, No. II. % lb. § lb. 54 TAXES ON and the revenue has increased from 691,136/. to 809,559/.* The duty on French wines was reduced in 1825, from lis. 5cL a gallon to 6s. (wine measure). There were imported in four years to 1825, on an annual average, 183,000 gallons, that yielded an average revenue of 106,000/. In three years to 1829, the quantity imported has been, on an average, 382,000 gallons, that yielded an average revenue of 115,000/. So that the reduced duty of 6s. has produced at the rate of 9000/. a year more than the former duty of lis. 5d. a gallonf . The duty on flint and plate glass was reduced in 1825 to 56s. per cwt. The quantity charged with duty for home con- sumption, on an average of four years to 1825, was 41,000 cwt. The quantity on an average of three years to 1829 has been 62,000 cwt. At present there is a small loss of revenue ; but as the quantity is gradually increasing, and was in the last * See Appendix, No. II. t lb. LUXURIES. 55- year 68,000 cwt., there will, in the end, be no loss in consequence of the reduction*. The Committee of Finance state, in their Fourth Report on the Revenue and Expendi- ture, that if the revenue had fallen off in the five years from 1825 to 1828, in the same proportion that taxes had been reduced, the diminution of it would have been 9,000,000/.; but that, owing to increased consumption, it had only fallen off about one-third of that sum. These different facts place it beyond all doubt, that when a tax has been carried to an excessively high point, the reducing of it is not necessarily followed by a reduction of revenue, but may lead to an increase. The duties which have just been men- tioned, occasion the greater part of the smuggling that is now successfully carried on to a great extent, notwithstanding the enormous expense incurred in attempting to suppress it. It appears from the examina- tion of Mr. Deane, the Chairman of the * See Appendix, No. II. 56 TAXES ON Board of Customs, before the Committee of Finance, that this expense cannot be com- puted at less than 700,000/. per annum*. Great, however, as this sum is. the profit that can be gained in consequence of the excess of the duties in proportion to the value of the articles on which they are levied, is so high, that it makes smuggling a very flourishing trade. It has already been shown, that three-fourths of the tobacco consumed in Ireland is supplied by smug- glers ; and the statement of Sir Hussey Vivian in the House of Commons in the last session, pointing out the severe duty per- * See Evidence of Mr. Deane, p. 18. — Paid by the Customs in 1827 £466,970 »» Excise „ 2,223 » Navy Department in 1827 167,518 >» Ordnance „ „ - 46,768 £683,470 Add for other Payments - 16,521 £700,000 181,000/. has been expended in building cottages for the coast guard. — See Papers, Committee of Finance, No. cxlii. LUXURIES. 57 formed by cavalry regiments on the coast, together with the frequent mention made in the newspapers of smuggling transactions, shews how extensively this traffic is going on in England. Mr. Deane was asked the following question, before the Committee of Finance. " Did you ever hear that in the ports of Flushing and Ostend, and in those ports where smuggling is carried on, it is capable of an insurance like any other risks?" He replied, " I have no doubt of it. I have heard of 10 percent, to 15 per cent." As it is the high amount of particular du- ties that alone makes smuggling a profitable trade, and as all experience proves that every attempt to suppress it will fail, so long as profit can be made by it, it is clear that nothing will put it down but reducing the duties. It has been well observed, that " to create, by means of high duties, an over- whelming temptation to indulge in crime, and then to punish men for indulging in it, is a proceeding wholly and completely subver- sive of every principle of justice. It revolts the natural feelings of the people, and teaches them to feel an interest in the worst cha- 58 TAXES ON racters, to espouse their cause, and to avenge their wrongs. A punishment which is not apportioned to the offence, and which does not carry the sanction of society along with it, can never be productive of any good effect : the true way to put down smuggling is to render it unprofitable by reducing the duties on the smuggled commodities *." The great disproportion of the duty on tobacco to the natural price of it, the circum- stance of its being almost a necessary to the lowest classes of society, and the facilities the high duty holds out to illicit trading, concur in rendering it one of the most ob- jectionable duties. As the price of tobacco, exclusive of duty, cannot be taken at more than 4d. a lb. the tax of 3s. a lb. is at the rate of 900 per cent. ; and therefore, in order to withdraw this article from the hands of the smuggler, a very large reduction ought to be made. Unless reduction is carried sufficiently far on this and other articles, smuggling and the expense of attempting to suppress it will continue, and thus the prin- * See Edinburgh Review, vol. xxvi. p. 536. LUXURIES. 59 cipal object in sacrificing revenue will not be attained. A reduction of 2s. a lb. on tobacco might perhaps put a stop to the smuggling of it. But if such a reduction should be made, the loss of revenue cannot well be estimated at less than 1,500,000/. With respect to smuggling, the duties on brandy and geneva are as objectionable as that on tobacco. As the price of them, ex- clusive of duty, does not exceed 4?. a gallon, the duty of 22s. 6c/. (I. M.) a gallon is 550 per cent. As the difference between the duty of 7«. a gallon on English spirits, and 2s. I0c/. a gallon (I. M.) on Scotch and Irish spirits, leads to the smuggling of the latter into England, the true way of adjusting the duties on spirits would be, to raise the duties on Scotch and Irish spirits, as high as they could be raised without producing illicit distil- lation, and to fix the same duty on all other kinds of spirits. It is not easy to estimate with any accu- racy what the loss of revenue would be from such an arrangement of the duties ; but tak- 60 TAXES ON ing into consideration the increased revenue which would be obtained on Irish and Scotch spirits, and the increased consumption of fo- reign spirits, in consequence of the reduction of the duty, it would not probably exceed 1,500,000/. The common objection, that the diminish- ing of the price of spirits will encourage the vice of drunkenness, will not in this case be entitled to much consideration. In the first place, the plan goes to raise the price of spirits in Ireland and Scotland ; and in the next, it may be replied to those persons who may urge it, that in France, Holland, and the United States,where spirits are much cheaper than they will be in this country with the reduced duty, drunkenness is comparatively unknown, and that the encouragement which is given to smuggling by high duties, is far more injurious to the morals of the people, than the effect of low duties would be in rendering the means of intoxication cheaper. Experience shews how futile it is to attempt to enforce morality by sumptuary laws : the only effectual mode is by pro- moting the diffusion of knowledge, and LUXURIES. 61 introducing better habits among the lower classes. With respect to the sacrifice of revenue which would be made by reducing the duties on tobacco and spirits (3,000,000/.) in the manner now proposed, when it is taken into consideration that this amount of revenue is obtained by promoting smuggling to the ex- tent which it is now carried on (for it is almost wholly confined to these articles), and by incurring an annual expense of 700,000/. in attempting to suppress it, it is clear that it is impossible that such an amount of revenue could be raised by more objectionable means. But the lowering of these duties would be attended with another very important re- sult besides that of putting down smuggling, namely, the increase of the consumption and importation of tobacco and spirits, in consequence of the effect of the reduction of the duties in reducing the prices of them. In the case of tobacco, with a reduced duty, more capital would be employed in buying the additional quantities of tobacco which would be consumed, and more ships and seamen in importing it : in the next 62 TAXES ON place, more raw materials would have to be imported to make the goods which would be required for exportation to pay for the ad- ditional quantity of tobacco ; more capital would be employed in buying these ma- terials, more workmen in manufacturing them, and more ships and seamen in export- ing the goods made with them. The re- duction of the duty on spirits, and of every other excessive duty, would be followed by similar beneficial results to national industry and wealth. So that excessive taxation is not only impolitic, from its effect on the re- venue, but in consequence of its diminishing the productions of industry and foreign com- merce. The statement which has been made to shew the effect of the late reduction of the duty on French wines, proves that it was a very successful experiment ; and an addi- tional advantage would be gained, both with respect to the revenue and the interests of the consumer, if it were still further reduced. But, considerable as this benefit might be, it is nothing when compared with the advan- tage of a less restricted trade with France, LUXURIES. 63 towards which a further reduction of duty might lead. " There are no two countries better suited for an advantageous commer- cial intercourse, as well by local situation as by the nature of their productions, than Great Britain and France. They may be con- sidered as the two most civilized nations of the world ; they are within a few hours' sail of each other ; and at the same time the one is distinguished by peculiar advantages, both natural and acquired, for the mainte- nance of manufactures, whilst the other abounds in all those natural productions for which the extent of its territory, the fertility of its soil, and the excellence of its climate, eminently qualify it*." As England is no longer bound by the Methuen treaty, the duty on French wines should be lowered below that on stronger wines, so as to allow them to be purchased at more moderate prices. If the duty was reduced to 2s. 6d. a gallon, there can be little doubt that the consumption would be treble what it now is. Forty years ago as much claret was con- sumed in Ireland (500,000 gallons), when * Parliamentary Review, 1825, p. 07J. 64 TAXES ON the duty was 2s. Id. a gallon, as is now con- sumed in the United Kingdom ; so that it is by no means taking at too high an estimate the future consumption at 1,500,000 gallons : this would yield a revenue, at 2s. Qd. a gallon, of 187,000/., which would be greater than the present revenue derived from French wines, by 35,000/. Although there appears to be some very strong reasons in favour of reducing the duty on tea, as it is an article that is not smuggled, it perhaps will be advisable not to make any change until the monopoly of the East India Company is got rid of; for, however low the duty may be reduced, it does not follow that the price will fall, because the Company have the power of keeping it up by limiting the quantity imported. As the effect of the monopoly is to make the price of tea nearly double the price at the sales of the India House to what it is at Hamburgh or New York, it is not impossible but that tea would bear a duty of 100/. per cent., as coffee does now, if the trade in it were free ; the effect of the monopoly, in point of fact is, to make the LUXURIES. 65 duty 200/. per cent, on the true value of tea. As the price of sugar is raised beyond what it ought to be, — first, by the protecting duties on East Indian and foreign sugars ; secondly, by the bounty on sugar exported ; and, thirdly, by prohibiting the refining of it in the colonies, — the true course to take in order to extend the consumption, and to increase the revenue, is to remove these re- strictions upon the free use of it. Such a step would, perhaps,, have the effect so far of lowering the price, as to admit of the duty of 27.?. a cwt., which would be about 100/. per cent., being continued without any very material restraint on the consump- tion of sugar. At all events, the reduction of the duties on tea and sugar ought rather to follow than accompany the repeal of the taxes on materials and manufactures, and the reduction of the duties on tobacco and spirits. In making an estimate of the revenue which would be lost by reducing duties, nothing should be set down for repayment of duty on stocks on hand, on the ground F 66 TAXES ON that the holder of such stocks has a just claim for repayment ; for experience esta- blishes the fact that, in almost all cases of past reductions of duties, prices have kept up, and given rise to a good deal of clamour and much undeserved condemnation of dealers in the articles which have been relieved of duty *. The practice of repaying duties, if it were regularly adopted, would lead dealers, on finding that a duty was to be reduced, to amass large stocks, for the sake of the profit they would make by prices keeping up, as they always do, in a greater or less degree, for a considerable time after the repeal of the duties actually occurs. If the intention of reducing or repealing a duty on any article was given notice of for some time previous to its being carried into effect, the dealers in it would take care * See Speeches in the House of Commons on the last reduction of the Wine Duties. In 1824, 460,886£. was repaid for duties on the stock of silk goods on hand (An. Fin. Ace. 1825, p. 45) ; and in 1825, 1,021,0441. was repaid for the duty on the stock of wine on hand. — See Appendix, No. II. LUXURIES. 67 to diminish their stocks of it ; and as, in case of the duty not being repaid, they would all be losers by a sudden reduction of price, they would not enter into com- petition to undersell each other, but they would rather combine together to do all in their power to keep up the price until new stock could be brought forward. F2 CHAPTER V. TAXES FOR GIVING PROTECTION TO AGRICULTURE. It will be seen by the following list of articles of foreign production, and the duties to which they are subject, that no oppor- tunity has been lost of endeavouring to pro- mote the interests of the landowners, by excluding foreign competition. £. s. d. Bacon, per cwt. - - - 18 Beer, per 32 gallons - - 2 13 Butter, per cwt. - - - 10 Bristles, not sorted, per lb. - 3 , sorted, ditto - - 4 Cider, per ton - - - 21 10 Cheese, per cwt. - - 10 6 Cucumbers, ad val. - - - 20 Hay, per load - - - 14 Hair, cows and oxen, per cwt. - 2 6 Hair-powder, per cwt. - 9 15 Hops, per cwt. - - - 8 1 1 Hemp seed, per quarter - 2 Hemp undressed, per cwt. - 4 C Lard, per cwt. - - - 8 £. s. d. 6 1 G 10 6 1 39 18 7 6 22 13 8 2 1 1 2 6 8 6 3 •2 10 2 15 PROTECTING AGRICULTURE. 69 Madder, per cwt. Madder roots, per cwt. Mules and asses, each Horses, each - - - - Oil, rape and linseed, per ton Peas, per bushel - Perry, per ton ... Potatoes, per cwt. - Seeds, clover, hay, &c. &c. Spirits, foreign, per gallon (I. M.) Rum, per gallon - Tallow, per cwt. - Tares, per quarter Timber, per load - Wheat \l. 5s. a quarter to Is., according as the price rises from 6ls. to 70s. a quarter. Barley, 13s. lOd. a quarter to Is., according as the price rises, from 32s. to 40s. a quarter. Oats, 10s. 9d. a a quarter to Is., according as the price rises, from 24s. to 31s. a quarter. On other grain, flour, and meal, the duties are according to these scales. Beef, lamb, mutton, pork, sheep, and swine, are pro- hibited to be imported by 6 Geo. IV. c. 117. Taxes on food consumed by landlords or capitalists are paid by the consumers ; but when consumed by the labourers, they have nearly the same effect as an equal amount of taxes laid directly on wages. There are 70 TAXES FOR some cases, but these are very few, in which taxes affecting wages are really de- frayed by the labourers ; but their common and ordinary effect is to cause, sooner or later, an equivalent rise in the rate of wages, and a proportional fall in profits*. The duties and prohibitions for restricting the importation of the productions of foreign agriculture, not only have the effect of making the public pay a higher price for all articles of food, but by diminishing the value of the annual imports some millions, they diminish to the same amount the annual value of the exports of British manufactures, because it would only be by exporting them that the imported corn and other articles could be paid for. In this way, therefore, the protection that is given to agriculture greatly diminishes the demand for the em- ployment of capital and labour, and the progress of accumulating national wealth. But if protection must be given, were it of a more moderate kind, and provided by * Mr. Mc Culloch's Edition of the Wealth of Nations, Note of Editor, vol. iv. p. 554. PROTECTING AGRICULTURE. 71 a fixed duty of about 10/. or 12/. per cent., there would be, even with this large protec- tion, a very considerable quantity of corn and other productions of land imported, and consequently a large revenue obtained from the duty, which would come in aid to the repealing of duties on raw materials and manufactures, and in this way make some amends for the injury it would still do to industry, in raising the price of food. CHAPTER VI. TAXES FOR GIVING PROTECTION TO BRITISH MANUFACTURES. Notwithstanding all that has been said of our new system of free trade, with respect to manufactures, little or no change was really made by the alteration of the protect- ing duties and prohibitions in 1825. An ac- count, that has been laid before the House of Commons, of foreign manufactures im- ported in 1824, the year before the altera- tion, and in each of the years 1826 and 1827, the two years which followed it, proves this fact beyond all question*. * The following Table has been formed out of this ac- count : — Imported, 1824. 1826. 1827. Brass manufactures, value £. 740 862 750 Carriages - - - ditto £. 927 1,259 1,683 China and earthenware, do. £. 7,418 18,310 18,718 Copper BRITISH MANUFACTURES. 73 With respect to the silk and glove manu- factures, this account shews how unfounded the assertions are which are so loudly made, that these manufactures have been utterly ruined by the admission of foreign manufac- tures ; for the whole amount imported since 1825 forms scarcely a few days' consump- tion, and a mere nothing in comparison with the quantity of these goods that are annually made in the United Kingdom. The great increase of the quantity of raw Imported. 1824. 1826. 1827. Copper manufactures, value £. 173 451 818 Cotton ditto ditto £.101,840 104,416 109,120 Gloves - - pairs 477,107 865,176 Iron in bars - tons 12,091 12,820 14,293 Leather manufactures, value £. 623 1,672 4,000 Linen ditto pieces 29,893 32,955 60,490 Musical instruments, value £. 576 4,554 5,244 Silk manufactures. Plain lace square yards 67,526 60,006 122,238 Entered by weight, lbs. 48,300 45,278 Ditto, at value - £. 15.218 26,128 54,179 Indian ditto - - - - £. 304,421 5,365 Watches and clocks, value £ 10,224 15,259 15,599 Woollen manufactures, do. £. 2,876 24,143 35,157 Parliamentary Papers, Sess. 1828. No. 322. 74 TAXES FOR PROTECTING silk imported proves that the late depressed state of the silk trade was wholly owing to over-production. Whatever doubt may have been felt on this point is now completely re- moved by the present revival of the trade, notwithstanding that the importation of fo- reign silks is still going on. As none but kid gloves are imported, the great increase which has taken place in the quantity of kid skins imported shews that the depression of the glove trade could not be owing to the quantity of foreign gloves imported ; but that it was owing also to over- production. So that, on the whole, it may be stated in the broadest manner that lan- guage can state it, that it is a false inference to draw from the distress in which these par- ticular manufactures have been, that the changes of 1825 have been instrumental in producing it ; and further, that it is equally false to assert that these changes have es- tablished a free trade in the place of the old system of protection. If free trade, there- fore, is the right policy, the work of intro- ducing it still remains to be done. BRITISH MANUFACTURES. 75 In order to leave no possibility of doubt with respect to the truth of this conclusion, tables are given in the Appendix of the duties which are at this moment levied on foreign manufactures. By these it will be seen, 1st, what the protecting duties are for such of our manufactures that cannot be affected by the freest competition ; 2dly, what they are for such of our manufactures that it is com- monly supposed would be injured by com- petition ; 3dly, what they are which fall on manufactures of trivial value ; 4thly, what they are which fall on those manufactures of materials that serve in the first process of manufacture as materials of other manufac- tures *. The varieties of climate, situation, and soil, afford to every country some advan- tages in the employment of industry not pos- sessed by others. By making use of such advantages a country will contribute its greatest power in the production of wealth. Hence it is that the capital of England is * See Appendix, No. III. 76 TAXES FOR PROTECTING much more productive of wealth if employed in coal, iron, tin, and other natural produc- tions, and in those objects in which these articles contribute to diminish the cost of production, than it is if employed in making those things which a foreign country can make cheaper in consequence of the advan- tages that are peculiar to it. All protection, therefore, by diverting the industry of the country from those branches of production for which it is best qualified, is mischievous ; and, when once imposed, creates a mass of artificial interests, whose existence, depend- ing on the system from which they sprang, forms a great obstacle in the way of getting rid of it*. The history of the protecting system shews it had its origin at a period when nothing was known by statesmen and legislators of sound principles of trade. It seems to have been introduced into European policy by M. Colbert. Before his time Holland sup- plied all Europe with manufactures, and re- * Parliamentary Review, 1825, p. 631. BRITISH MANUFACTURES. 77 ceived in payment for them the raw produce of her poor neighbours. M. Colbert, over- looking the facts, that manufactures cannot be established in a country until it has ac- quired a considerable capital, and until the people of it have become rich enough to be able to buy them, sought to force the growth of manufactures in France, merely by issuing his famous tariff of 1667, by which the im- portation of all manufactures into France was prohibited. The failure of his theory is amply attested by experience. France ever since that period has been paying for the manufactures used by her (taking price and quality into consideration) from half to twice as much more as England and Holland have paid, and her establishments have con- tinued of the most wretched description till within a few years. They are now, by high prices and limited consumption, greatly de- pressed below what they would have been in a country so fit for manufactures, if no protection of them had ever existed. Immediately after the appearance of the tariff of 1667, the Dutch retaliated by pro- 78 TAXES FOR PROTECTING hibiting the importation of the wines, bran- dies, and other productions of France*. This commercial warfare produced open hos- tilities in 1672, and a war that lasted six years ; and it is to commercial prohibition and retaliation that most of the wars in Eu- rope, since 1667, are to be attributed. England followed the example of Holland in prohibiting French productions; and from that time has been amongst the foremost of states in loading her commercial legis- lation with all kinds of mischievous and erroneous regulations. As this system of protection has been steadily acted upon by all nations since 1667, on a most mistaken notion, which has been generally held, that the protection of trade was a necessary part of the duty of the exe- cutive government ; when it is considered, on the one hand, what the consequence would have been throughout the world of allowing trade and manufactures to take their natural course in supplying every country with every * Richesse de la Hollande, vol. i. p. 345. BRITISH MANUFACTURES. 79 article of production of the best quality, and at the lowest possible price, and in advanc- ing universal wealth and civilization ; and on the other, what the consequences have been of the numerous wars which the system of protecting trade and manufactures has given rise to, we cannot avoid coming to the conclusion, that those statesmen who in- vented this system, and who have supported it, and do still support it, deserve to be classed among the greatest enemies of mankind. As there are still many persons who ima- gine this system is right, the explaining of the various evils which it occasions cannot be too often repeated. When protections are introduced, and foreign cheap goods are shut out, and the same kind of goods are made at home, but at a greater cost of production, then the ca- pital and labour of the country that excludes foreign goods, cease to produce the greatest possible quantity of productions ; the coun- try is consequently poorer than it otherwise would be ; for when a country consumes an article made at home, which could be got 80 TAXES FOR PROTECTING cheaper from another country, it employs a certain number of men's labour, in providing that article, more than it would be necessary to employ if it imported that article. The country is therefore poorer, by the whole value of these men's labour. This system of protection, by preventing the importation of foreign goods, diminishes the demand for the exportation of British goods ; and also diminishes the employment of shipping and foreign commerce, in the same way as the excessive duties on to- bacco, tea, &c v and the corn laws, dimi- nish it. The present state of the commerce be- tween England and France affords a deci- sive proof of the impolicy of the protecting system. In the natural course of things, two such countries, so contiguous to each other, and each having so many productions peculiar to itself, would carry on a trade to the amount of many millions; but according to the accounts laid before Parliament, the whole of the trade in exports and imports does not exceed 3,000,000/. a-year. BRITISH MANUFACTURES. 81 Another evil of the protecting system is the increased prices of a number of arti- cles, which are the result of it. These prices take immense sums of money from the pockets of the consumers of the protected commo- dities, who are not aware how large a pro- portion of price is caused by this kind of tax. Prices are, in fact, so generally and so much increased by protecting duties, that it is by no means clear that they do not bear as heavily on the national resources and on the productiveness of capital and labour, as the taxes themselves ; and therefore, the reducing of these prices, by taking off pro- tecting duties, would afford all classes of the community the greatest possible relief. There can be no greater mistake than supposing that the manufacturers derive any benefit from protections ; for if, in the first instance, they raise profits, this leads to im- mediate competition, in consequence of there being nothing to exclude new manu- facturers from entering into the protected trades, and profits are soon brought down G 82 TAXES FOR PROTECTING to their ordinary level. But, in truth, the persons who carry on the protected trades are more exposed to suffer than any other class of manufacturers ; for since the goods that are made under the influence of pro- tection are necessarily dearer than foreign goods of the same kind, whenever compe- tition in the home market leads to a glut of them, a circumstance which continually occurs, then there is no means of relieving the market by exportation ; there is no pro- fit in carrying on the protected trades, but absolute loss ; and in addition to this, the protected manufacturers are always exposed to suffer great injury from smuggling. Another injurious effect of protection is, that it checks inventions, and enables ma- nufacturers to keep the public supplied with commodities of inferior quality ; for no manufacturer will incur the loss of laying aside old and imperfect machinery, and of reforming the processes of his trade, until he is forced to do so by the necessity of keeping on equal terms with his foreign competitors. BRITISH MANUFACTURES. 83 Another evil of protection is the encou- ragement it gives to smuggling, and it also occasions a great loss of revenue ; for if the protecting duties were reduced so as to be- come moderate duties, for the sole object of obtaining revenue, the increased consump- tion of foreign goods, which would be the result, would yield a very considerable re- venue, not, perhaps, less than 1,000,000/. a-year. There is not the slightest foundation for the commonplace argument, that, if British manufacturers were not protected, the low price of labour in foreign countries would enable them to supply our markets. For it is not necessarily true, that because labour is dear in England, as compared with other countries in Europe, that those coun- tries would be able to compete with us in manufactures. The argument is built on a wrong notion of what determines us to export. Exportation takes place from Eng- land rather than from France, not because wages are lower (for in fact they are higher), but because the whole cost of production of G 2 84 TAXES FOR PROTECTING the exported commodities in England, is less than the whole cost in France. Of the cost of production, wages are only a part ; but they seem to be considered the whole by those who insist upon the argument in question*. The support that is still too generally given to the protecting system, can only be accounted for by the habit of indolence with which the strongest minds sometimes re- ceive, without examination, those opinions which have been long established. But it is satisfactory to observe, that there have been appearances of late years of a great progressive knowledge on this subject, and of a great change in the public mind. In 1820 a measure took place, which has been well described as forming an impor- tant era in the commercial history of this country ; namely, the presenting of a pe- tition to the House of Commons by the merchants of London, in which the principle of a perfectly free trade is proposed, and * Par. Rev. 1825, p. 703. BRITISH MANUFACTURES. 85 supported by unanswerable reasoning. The petitioners say, with reference to the system of protections, " That unfortunately a prac- tice, the very reverse of freedom from restraint, has been, and is more or less adopted, and acted upon by the governments of this and almost every other country ; each trying to exclude the productions of other countries, with the specious and well-meant design of encouraging its own productions : thus inflicting on the bulk of its subjects who are consumers, the necessity of sub- mitting to privations in the quantity and quality of commodities ; and thus rendering what ought to be the source of mutual benefit and harmony among states, a constantly recurring source of jealousy and hostility. That the prevailing prejudices in favour of the protective or restrictive system may be traced to the erroneous supposition, that every importation of foreign commodities occasions a diminution or discouragement of our own productions to the same extent ; whereas, it may be clearly shown, that although the particular description of pro- 86 TAXES FOR PROTECTING duction which could not stand against un- restrained foreign competition would be discouraged, yet as no importation could be continued for any length of time, without a corresponding exportation direct or indirect, there would be an encouragement for the purpose of that exportation of some other production to which our situation might be better suited ; thus affording at least an equal, or probably a greater, and certainly a more beneficial employment to our own capital and labour." Similar petitions were presented at the same time from Glasgow, and all the great trading and manufacturing towns. The following is taken from the petition of the merchants of Bristol, against the re- newal of the Charter of the East India Com- pany, presented on the 12th of May, 1829, to the House of Commons. It affords the best practical authority in favour of what has been so often stated in the preceding pages, of the advantage of extended im- portation in increasing the demand for Bri- tish productions. The petitioners say, " That BRITISH MANUFACTURES. 87 the extension of this most important branch of commerce (our exports) with so many millions of our fellow-subjects, is prevented by the deficiency of suitable returns ; for the production of which the soil, climate, and population of India are peculiarly adapted, and which need only the due application of British skill and capital. The removal of the existing restrictions will necessarily create increased demand for British goods, the increased employment of British arti- sans, encouragement to British agriculture, augmented and improved imports of East India produce, extended employment of British shipping, and increase of national revenue." The Committee of Ways and Means of the Congress of the United States say, in their Report of the 12th of March, 1828, " In all cases where high duties are im- posed to afford protection, foreign commerce must, in the nature of things, be diminished to a greater extent than domestic industry is encouraged ;" and they add, " In closing this brief and imperfect review of the de- 88 TAXES FOR PROTECTING stroying operation of the proposed prohi- bitory policy, denominated, with singular un- appropriateness of language, a protecting policy, they cannot but pause to make a remark, obviously suggested by the occa- sion, that it is much easier to destroy than to create wealth by legislation *." The Committee of the citizens of Boston and its vicinity, in their Report, dated Nov. 30, 1 827, on the new American Tariff, make the following remarks : — " That dear goods made at home are better than cheap ones from abroad ; — that capital and labour can- not be employed in this country without prohibitory duties ; — that it is patriotic to tax the many for the benefit of the few ; — that it is just to aid by legislation manufac- tures which do not succeed without it ; — that we ought to sell to other nations, but never to buy from them, are, we have long since known, fundamental principles among the advocates of the American system. It is, however, extraordinary that these an- cient and memorable maxims, sprung from * Parliamentary Paper, 1828. No. 178. BRITISH MANUFACTURES. 89 the darkest ages of ignorance and barba- rism, should take their last refuge here, and find a statesman of great reputation and knowledge willing to risk his reputation in their defence*." The petition of the proprietors of vine- yards in the department of the Gironde, presented to the French Chambers in ] 828, and signed by 12,563 individuals, all what may be called practical men, places in a clearer point of view, than any document that ever was published, the great evils of the prohibitory system, and strikingly demonstrates, that whatever it may confer on one or more branches of industry, must be obtained by the infliction of an equal or greater loss to others that are naturally more advantageous. The petitioners stigma- tize the prohibitory system as a " deplorable error," as " a contradiction," and "an ab- surdity ;" and shew that their distresses have originated in the restrictions laid on the importation of foreign productions into France. ♦Report, p. 35. 90 TAXES FOR PROTECTING Such then are the consequences of the protective system ; a system which prevents those countries, which are subject to its in- fluence, from enjoying the full measure of productiveness which their separate advan- tages might be made to yield; which di- vides the community of each country into two classes, the consumers and the monopo- lists, each interested in each other's loss ; a system which bolsters up a bad principle with an infinitely vexatious detail of duties, drawbacks, and prohibitions ; and, what is worst of all, which is established to the ad- vantage of nobody, and the disadvantage of all the world. The public interest, there- fore, requires the total abrogation of it ; but this should be brought about by degrees, for it must be admitted that those who are now protected by restrictions have a right to demand that they should not be suddenly repealed, and that a reasonable time should be allowed them to prepare themselves for meeting foreign competition, or to withdraw from their present employments. This much they have a right to ask, and ought to ob- BRITISH MANUFACTURES. 91 tain, and no more ; for, if more be granted, the interests of the majority of the public will be sacrificed to those of a very small part of the community *. One point only remains to be noticed be- longing to the protecting system, namely, the opinion which some persons hold, that we should not remove the restrictions on the importation of foreign goods, unless foreign countries agree to allow our goods to be imported. But the grounds on which it is expedient for us to remove these restric- tions, are the numerous injuries we suffer from them in the several ways already described ; if, therefore, we postpone the removal of them till we can persuade other countries to make an arrangement for a reciprocal removal, we postpone taking advantage of the power that is in our own hands of relieving ourselves. The Petition of the Merchants of London, before referred to, contains the following paragraph on this point : — * Foreign Quarterly Review, No. VI. p. 649. 92 TAXES FOR PROTECTING "That although, as a matter of mere diplo- macy, it may sometimes answer to hold out the removal of particular prohibitions or high duties, as depending upon correspond- ing concessions by other states in our favour, it does not follow that we should maintain our restrictions in cases where the desired concessions on their part cannot be obtained. Our restrictions would not be less prejudicial to our own capital and industry, because other governments persisted in preserving impolitic regulations." As the progress of industry and the in- crease of capital are greatly promoted by everything that adds to the annual amount of imports, the right policy is to remove all obstructions in the way of importation, with- out the slightest reference to what course foreign governments may think proper to adopt. Everything has now been stated that seems necessary to be urged at the present moment in favour of a revision of the ex- isting taxes; for though much might be said against several others that have not BRITISH MANUFACTURES. 93 been noticed, there are none which do the same injury to industry and national pros- perity as those which have been under exa- mination. The effort which was made in 1825 to obtain a repeal of the assessed taxes, was founded on a total misconception of the comparative effects of different kinds of taxes on the interests of the people — no ad- vantage would have arisen from the repeal of those taxes beyond the mere relief from so much taxation ; while, on the other hand, the repeal of the taxes on raw materials and manufactures, and the reduction of the enormously high duties on tobacco and fo- reign spirits, would be productive of con- siderable benefit to the consumer, would put an end to smuggling, and would increase the employment of capital, and labour, and foreign commerce. Lord Goderich is en- titled to the greatest praise, for having had the firmness, in 1825, to resist the temptation of sacrificing a sound principle to the acquisition of temporary popularity ; he has the merit of being the first Chancellor 94 TAXES FOR PROTECTING of the Exchequer who reduced to practice those principles, which are the only secure basis of national prosperity. The inquiry, which is the subject in the preceding pages, into the effects of those taxes which have been particularly men- tioned, leaves no doubt as to how much the industry and wealth of the nation would be increased, if it were practicable to modify or wholly to repeal them ; and at the same time secure, by other means, a sufficient revenue for the public service. A powerful inducement is, therefore, established to en- deavour to ascertain, whether means cannot be found for making good the revenue that would be lost by giving the public the benefit of the proposed reform of taxation. Although a general notion prevails, that no such means can be found out, it is a mere conjecture, and not deserving of any weight; because no proper efforts have as yet been made to trace out, in sufficient detail, the sources from which new revenue might be derived, or, what is the same thing, the pre- sent scale of expenditure diminished. If, on BRITISH MANUFACTURES. 95 the one hand, the country has been going on, as would appear to be the case from what has already been said, in a progressive course of accumulating new wealth, and thus adding to the resources of new taxation ; and if, on the other, a system of great pro- fusion has been engrafted in the adminis- tration of the public expenditure, there is a strong prima facie case to justify the con- clusion, that, if proper measures were taken, there would be no great difficulty in pro- viding, by new methods, a sufficient revenue for the public service. It is, no doubt, the duty of ministers to act with the greatest circumspection with respect to every plan of reform, which, by possibility, might place the Treasury in a situation not to be able to meet the current demands upon it. But all hazard of this kind might be avoided by proceeding in the business of reducing or repealing taxes by degrees, and by making the measures for supplying new means of providing for the expenditure take precedence. If, upon a full consideration of the policy 96 BRITISH MANUFACTURES. of removing all impediments in the way of the progress of industry, and the accumula- tion of national wealth, it were thought ex- pedient to make a considerable reduction in the taxes affecting industry, the revenue might be rendered sufficient for all the pub- lic services. 1st. By the increased revenue which would arise from increased expendi- ture on taxed commodities in consequence of repealing the taxes and taking off pro- tecting duties. 2dly. By the retrenchment of the public expenditure. 3rdly. By new taxes. Each of these will be examined in the following pages. CHAPTER VII. EFFECT OF REPEALING TAXES IN MAKING THE REMAINING TAXES MORE PRODUCTIVE. The extraordinary effect of reducing taxes in increasing consumption, and producing new revenue, is completely established in the Fourth Report of the Committee of Finance. The Committee refer to the accounts shewing the actual produce of the duties under the Customs, Excise, Stamps, and Assessed Taxes, compared with what the produce would have been, if the re- duction of taxes which took effect after 1823, had diminished those revenues in the exact proportion which they bore to the pro- duce of that year ; and say, " It will be seen by this abstract, that the abatement of the revenue by taxes remitted, would have ii 98 EFFECT OF been, in 1827, as compared with 1823, no less than 9,182,571/. and that it proved to be only 3,508,316/., the difference of 5,874,255/., being the increase of revenue from increased consumption*." The fact that is here so completely esta- blished, of the immense influence of redu- cing taxes in increasing the revenue derived from those which remain, is of the highest importance. It fully exposes the futility of the commonplace plea, that the financial circumstances of the nation do not admit of the reduction of any more taxes ; and it gives to those persons, who now argue in favour of the revision and reduction of taxes, a right to say, that a very large portion of the revenue which would appear, on a strict calculation, as likely to be lost, would be made good by the increased productiveness of the taxes which would remain. According to the case stated by the Committee of Finance, if all the taxes were repealed which fall the heaviest on industry, the loss of * Page 10. REPEALING TAXES. 99 revenue would amount to but a few mil- lions. As some of the measures for reforming our present taxes will lead to the production of revenue, where little or none is now pro- duced, these should be taken into the account, in shewing how lost revenue may be made good. For instance, by altering the present prohibitions and duties on corn and other agricultural productions, to a duty of 12 per cent., such a duty would, in all probability, produce a revenue of six or seven hundred thousand pounds a year on corn, and of three or four hundred thousand pounds a year on other productions of land. By reducing, as has been proposed, all the protecting duties to 10 per cent., so as no longer to keep any duties for protection, but only for revenue, such large quantities of various kinds of foreign articles would be imported, that a revenue of a million a year may reasonably be calculated upon as the result of such an arrangement. If the duties on coals ex- ported to foreign countries were reduced one half, an additional revenue of three or four II 2 100 EFFECT OF hundred thousand pounds would be received : and if machinery were allowed to be ex- ported under a duty of about 12 per cent., so great would, no doubt, be the demand for it, in all parts of the world, that a similar amount, at least, of revenue would be ob- tained in this way. If those monopolies and protections, which have been mentioned as having the effect of taking many millions an- nually out of the pockets of the people, by the high prices they occasion, were removed, this would leave these millions to be ex- pended on taxed commodities, and thus augment the revenue. What has been al- ready said on the subject of the Malt duty, shews that a proper revision and reform of the regulations by which it is collected, and of the licensing system, would, to a certainty, be accompanied with a considerable increase in the revenue derived from this duty.. So that, on the whole, when the effects which would ultimately be produced on the public revenue are duly examined, it is clear that if several millions were surrendered in the first instance, in order to give new force to REPEALING TAXES. 101 national industry, the measure itself, with the other reforms of duties which it is pro- posed to accompany it, would reproduce a very large portion of them. CHAPTER VIII. RETRENCHMENT. In the following pages the public expen- diture will be examined in detail, in order to point out where retrenchment may be introduced ; but before going into this in- quiry, some general observations will be made to explain — First, the necessity of it; secondly, the practicability of it; thirdly, the principles on which it ought to be con- ducted ; fourthly, the difficulties in the way of accomplishing it. First, retrenchment is necessary as one of the principal means of relieving industry from a large part of those taxes which press the heaviest upon it. Sufficient has already been said to explain in what manner taxa- tion restrains the progress of industry and of national wealth. Retrenchment is also necessary as a pre- paration, in order to protect the finances of RETRENCHMENT. 103 the country from the destructive effects of the funding system, whenever a new war shall take place ; for in proportion as our peace establishment is low, the difficulty of procuring the additional funds which a war will require by war taxes will be less. Every one must admit, that if we have to begin a new war with a peace expenditure of 55,000,000/.,* the prospect will be most * The following is the account of the public expenditure in 1827, as given in the Fourth Report of the Committee of Finance. 1. Charges of collection - - £3,868,761 2. Payments for bounties, and other services charged on the gross revenue - 1,339,725 3. Payments for interest, &c. on the funded and unfunded debt, including the Russian loan raised in Holland - - 28,940,701 4. Permanent civil services, including the civil list - - - 2,103,105 5. Occasional expenditure and advances under Acts of Parliament - - 363,511 6. Civil services, voted under the head of Miscellaneous - - 2,863,248 7. Military and naval services, annually voted 16,205,812 £55,744,863 All the calculations in the following pages of sums that may be retrenched, are made with reference to this expen- diture of 1827. 104 RETRENCHMENT. frightful ; nor can any one take a compre- hensive view of the state of public affairs, and feel satisfied in observing, that while the most expensive preparations for war are making in all the military departments, none is made for placing the treasury in a state to provide for those demands upon it, which a war will occasion. Under these circumstances, recourse will probably be had to borrowing to a great amount, and to new permanent taxes ; measures which will expose the country to suffer the loss of its manufactures, and finally to undergo all the evils of a na- tional bankruptcy. For these reasons, it is the bounden duty of ministers to make every possible retrenchment, and to confine the public expense within the narrowest limit within which it can be compressed, consistently with the maintenance of the tranquillity and independence of the country. Secondly, as to the practicability of re- trenchment, the zeal with which all existing expenses are defended throws a consider- able difficulty in the way of proving it. RETRENCHMENT. 105 Each public department stands prepared to give the most confident reasons why it is absolutely necessary to keep up the scale of its expenditure to the exact point at which it now is. Every kind of sophism, insinuation, and assertion is worked up with vast ingenuity into "a case to resist any at- tempt at effective retrenchment ; and not only government and parliament, but also the public, suffer themselves, in this way, to have their judgment influenced rather by the personal authority of official men, who are always endeavouring to keep their re- spective services in the highest possible state of equipment and show, than by those principles of a sound system of finance, which require that that portion of the public expense which is incurred for military pre- paration and protection, should be regulated by the quantity and measure of the danger to be guarded against. It is almost impossible for persons, not themselves in office, to have sufficient know- ledge of details, to be able to expose the fallacies on which the pleas for expense are 106 RETRENCHMENT. enforced ; and the absence of such an ex- posure produces too often a belief, that the expense is necessary. The only mode, therefore, that is left for making out a case to establish the practicability of retrench- ment is, by reasoning on probabilities, founded on those facts which are within the observation of every one. Although this is necessarily an imperfect kind of proof, the facts of profusion which can be adduced, when combined together and patiently ex- amined, will be quite sufficient to lead to conclusions that will leave no doubt on any unprejudiced and disinterested mind. 1. When we see how great the expense of the army, navy, and ordnance services is, in comparison with what it was in the peace preceding the war of 1793, we have a right to infer, prima facie, that the present ex- pense is much too great ; and the onus pro- bandi rests, clearly, with those in authority, to point out what the circumstances are which can justify so great an additional charge on the public. It may be seen, on referring to the evidence taken before the RETRENCHMENT. 107 Committee of Finance of 1828, that they concurred with this opinion ; for they com- menced the examination into each of the above-mentioned departments by quoting a similar opinion of the Committee of Finance of 1817 ; and calling on the witnesses for an explanation of the causes which had led to so expensive a peace establishment. After beginning their labours on such a principle, there can be little doubt that if they had been re-appointed in the last Ses- sion, they would have recommended consi- derable reductions in our military and naval forces to have been made, as soon as the war in Turkey and the affairs of Greece were settled. It is customary for the advocates of the present scale of expenditure to assume that Mr. Pitt was guilty of very unstatesman-like conduct, in having fixed so low an establish- ment in the peace preceding the war of 1793. But the defence which was made by Lord Grenville of Mr. Pitt in the House of Lords, on the 14th of February, 1816, should be attentively examined, before this assumption 108 RETRENCHMENT. of persons interested in the present scale of the expenditure is allowed to have much in- fluence. Lord Grenville on that occasion said, " He wished to call their Lordships' attention to the state of our establishment in a former period of peace — he meant the period be- tween 1783 and 1793. The establishment of that period was now to be not only doubled or trebled, but quadrupled, quintupled. He well remembered that at that period there was considerable doubt whether the establish- ment was not larger than the circumstances called for. The subject was much discussed, and the propriety of so large an establish- ment rested on the peculiar circumstance of Europe at that period. He had heard it said, that the great man who was then minister had changed his opinion, and had observed that in acting to the best of his judgment in requiring only 1,800,000/. for the army, and 2,000,000/. for the navy, he thought, on re- flection, he had ill discharged his duty. But he did most positively declare that he had not the smallest recollection, that he had no belief that Mr. Pitt ever expressed himself RETRENCHMENT. 109 otherwise on that subject than in terms of self-congratulation and conscious satisfac- tion, that he had, by the most scrupulous economy, at that time enabled the country to meet that dreadful period of trial which it had afterwards to encounter. He was convinced, that if Mr. Pitt were now alive he would have anxiously enforced the pro- priety of a low military expenditure at this period of peace ; and it was only by follow- ing the plan of that great man, and bringing the expenditure of the army and navy to the very lowest practicable point, that any hope remained of extricating the country from those difficulties in which it was involved*." It is by no means sufficient to be able to say, in order to meet the charge of profusion in the military expenditure, that the services are in a very high state of efficiency ; for this charge can be properly met, only by shew- ing that preparation and equipment have not been carried beyond the point which mani- * Hansard's Debates, vol. xxxii. p. 514. 110 RETRENCHMENT. fest grounds of public necessity prescribe. Unless this condition of necessity is taken into consideration, the expense to be incurred for the public service would be a mere mat- ter of fancy, and might be made twice what it is without any blame, provided that effi- ciency and equipment was doubled at the same time. Although this principle of ne- cessity appears to be so evident as almost to make it unnecessary to point it out, every one must be sensible, who has closely watched the reasoning of those military authorities according to which our establishments are regulated, that it can have had but little con- sideration in their minds. Referring, therefore, to the fact of the very great present amount of the peace establishment in comparison with .what the establishment was prior to 1793, and no sa- tisfactory reasons being given, grounded on a proper exposition of the danger to be ap- prehended, to prove that a public necessity exists for fixing it at treble the former amount, we come to the conclusion that a case can be RETRENCHMENT. Ill made out to shew that retrenchment is practi- cable in our military and naval expenditure*. 2. The admitted spirit of profusion which prevailed during the last war, coupled with the fact of nothing having since been effectually done to control it, suggests an- other argument for its being possible to make a considerable reduction in the expen- diture. The nature, character, and extent of the late war destroyed all previously es- tablished systems of control and economy. The facility of getting money by loans, through the help of inconvertible bank paper and of the sinking fund, led to that bound- less expenditure in subsidies, expeditions, fortifications, military pensions, civil super- annuations, and increased salaries, which consumed so many millions, and of which we are now feeling the effects. Now, though the war is over, the spirit of this profusion survives ; for it is not possible to point out any measure, or system of measures, which has produced any general and decided change * This conclusion is further established in the following pages, under the head of Army and Navy Expenditure. 112 RETRENCHMENT. in it ; and therefore there can be no doubt that if a strict spirit of economy were sub- stituted in its stead, a great deal of the pre- sent expenditure might be reduced*. 3. The fact that is admitted on all sides, that the Treasury has for many years ceased to exercise the control that belongs to it over the public expenditure, makes it even more than probable, that if it resumed and rigorously enforced its rights over the de- partments, a great deal of useless expendi- ture would be put a stop to. Before Mr. Pitt's administration, the Treasury exercised an active control over the public expendi- ture ; but under his administration it would appear, from the following extract from a speech of the late Lord Lansdovvne, on the 28th of February, 1797, that it had ceased to do so. i( Every office," Lord Lansdowne said, " seemed to be the lord of its own will, and every office seemed * Although the present administration has shewn, in se- veral instances, a disposition to be economical, nothing has been done in a way to make an impression on a so long- established evil as the profusion of several preceding govern- ments. RETRENCHMENT. 113 to have unlimited power over the purse of the nation, instead of their being, as the spirit of the constitution directed, under the constant check of the Treasury. It used to be the distinguishing feature of the British administration, that the Treasury was its heart ; it distributed the necessary nourish- ment to the other parts, and every thing flowed from it as the commanding centre ; the other departments were necessarily sub- ordinate." In point of fact the great de- partments, which have the management of the expenditure, attended the Board of Trea- sury with their annual estimates, for the purpose of examination and of explanation previously to their being submitted to Parlia- ment. The estimates were fully considered in all their details ; and the officers who at- tended were questioned and heard previously to the final decision and approbation of the Board being entered on its minutes. This was all consistent with the ancient, and con- stant, and uniform system of check and con- trol which had been invariably exercised by the Treasury over the expenditure of all the i 114 RETRENCHMENT. departments, in all their branches, and in all their details *, If this system of check and control were again brought fully into practice, there can be no doubt that retrenchment to a large amount would be found to be perfectly practicable. 4. The numerous reports on the public departments which have been made by Commissions of Inquiry and Select Com- mittees of the House of Commons, shew that there is not one of them, of which the constitution and organization is not extreme- ly defective. Every department has more branches, and every branch more officers and clerks, than would be necessary if a proper principle of consolidation were adopt- ed for the despatch of public business, and for the control of the individuals intrusted with it. In addition to this, the forms of doing business are ancient and cumber- some ; reformation, which has made such * From MS. Treasury Document on the Ordnance De- partment, No. 2, refering to precedents from 1755. RETRENCHMENT. 115 universal inroads into ancient institutions, and with such universal advantage, has been successfully excluded from the public offices — returns are required of whal is doing to a useless extent — checks are heaped upon checks of no real use — and corre- spondence is carried on between office and office, and between the offices and in- dividuals, in a manner quite uncalled for by any public benefit — salaries have been im- mensely increased, and very large sums of money have been squandered on official residences. With proofs upon proofs of the existence of these facts, the conclusion cannot be shaken, that a great saving of expense would be the consequence of such a revision of all the departments, as would introduce modern improvements, instead of a system of or- ganization and regulation, of which the origin may be traced back to centuries from the present time. 5. The complicated and multifarious methods of keeping accounts in all the public offices — the numerous and dilatory i 2 116 RETRENCHMENT. methods of auditing them — and the almost incredible fact, that there is not made up in any office such a document as an account of the actual annual expenditure of the public money, shew that there is reason for pre- suming, that if all this was changed, and a simple, uniform, and accurate system of pub- lic accounts introduced in its stead, a great retrenchment might be made in all the official establishments — at the same time that the public money would be under a more secure custody. There are some cases of expenditure in which there is no difficulty in bringing for- ward direct proofs of the practicability of retrenchment ; as for instance, the Bounties on Linen, on the Fisheries, and on Sugar — the management of the National Debt — the Office of Lord Lieutenant of Ireland — the Irish Miscellaneous Services — and the Co- lonial Expenditure. Thirdly. With respect to the principles on which retrenchment should be conducted, it is of the greatest importance that they should be well considered, and when decided RETRENCHMENT. 117 upon, most severely adhered to. No per- son can have his mind in a perfectly fit state to form a judgment on any question of retrenchment, without having acquired the habit by previous study — of referring to what the uses and object of government is, and the grounds on which taxes are paid. The great error which is commonly committed, is taking the utility of an expen- diture as a sufficient justification of it; whereas, however useful it may be, if it cannot be shewn to be absolutely necessary for securing some public object that could not be had by any other means, it is superfluous and ought to be discontinued. It is not an uncommon opinion among those persons who are in situations to have considerable influence in matters of finance, that we ought first to secure all the revenue we can, and then regulate the expenditure according to it. Others allow themselves to be guided by their feelings and their passions, and not having any fixed principles to go by, are continually favouring expense, and resisting economy, when cases of apparent 118 RETRENCHMENT. individual hardship come before them : not recollecting what those persons suffer, who pay the taxes for providing for the effects of their mistaken compassion and unjustifiable liberality with the public money. If right principles were referred to, they would sug- gest that taxation is the price we pay for government ; and that every particle of ex- pense that is incurred beyond what neces- sity absolutely requires for the preservation of social order, and for protection against foreign attack, is waste, and an unjust and oppressive imposition upon the public. Every minister, and every member of par- liament, who has the power to spend or to save the public money, should do all in his power to prevent the wants of the state from depriving the people of the means of providing for their wants ; and, therefore, economy and frugality, which are virtues in a private station, from their vast influence upon national happiness in a public station, become the most pressing of duties. Fourthly, the difficulties of carrying into effect a complete system of retrenchment RETRENCHMENT. 119 are extremely great. The first is to get ministers to comprehend the necessity of it, and to understand the means by which it may be accomplished. The distaste for abstruse reasoning, and the prejudice against the science of political economy, confine the numbers to a few, among those who take a lead in public affairs, who possess an extensive acquaint- ance with trade, and finance, and with the principles which ought to govern these branches of political science. But if the first difficulty is overcome, of getting a government sufficiently informed as really to comprehend the necessity of re- trenchment, and willing to retrench, another great difficulty presents itself, — namely, the opposition which is sure to be made to their plans of economy, even by their own friends, in both Houses of Parliament. When mea- sures of economy have been proposed by Government, the House of Commons has so frequently been anything but faithful in its representative character, that a government cannot but be very much checked in at- 120 RETRENCHMENT. tempting to carry into effect such a system of reform, as the circumstances of the country require. The remedy for this is, for Go- vernment, instead of exaggerating every trifling appearance of prosperity, to explain fully, and without reserve, all the facts of suffering and injury which shew the pro- priety and necessity of retrenchment, so as to excite the public to interfere and control their representatives. This is the way in which committees of the House of Commons may be made of great service; and perhaps it is the only way by which the opposition to retrenchment, which is the consequence of the interest which peers and members of parliament have in continuing a profuse scale of expenditure can be successfully re- sisted. If the public were made thoroughly acquainted with the causes which keep it up at its present amount, they would very soon load the tables of parliament with such remonstrances, as would enable government to carry their measures, without being exposed to be defeated, as they were last year in the Superannuation Bill, by mem- RETRENCHMENT. 121 bers holding offices, taking a lead in op- posing it. In order that nothing may be omitted that can be urged in support of the general rea- soning which has been advanced respecting the practicability of retrenchment, the public expenditure will be examined in detail under the heads of 1. The collection of the revenue. 2. Bounties. 3. The control and management of the expenditure. 4. Civil government. 5. Military expenditure. G. The slave trade. 7. The interest on four per cent, stock. 8. The sinking fund. 9. Colonies. 10. Ireland. CHAPTER IX. THE COLLECTION OF THE REVENUE. In the following short statement there seems to be a strong case in favour of the practica- bility of making a very considerable reduc- tion in the charge for collecting the revenue. In the year 1806, the gross receipt of revenue of the United Kingdom was 58,255,175/., and the charge for collecting it was 2,797,722/. In the year 1826, the gross receipt was 54,839,685/., and the charge for collecting it 4,030,337/. Hence it appears that 58,255,175/.. was collected in 1806, at a less charge by 1,232,615/., than 54,839,685/. was collected in 1826*. * There is no account made up for 1827 and 1828, on the same plan as that here quoted ; but no considerable change has taken place since 1826 in the charge for collection. REVENUE. 123 The accuracy of this statement cannot be disputed, because the dates and figures are taken from accounts which were prepared by the Treasury for the Committee of Finance, with the view of supplying the place of the annual accounts, which cannot be relied on*. The present charge of nearly 4,000,000/. a year for collecting 54,000,000/. is 7 J per centf . If by any means it could be reduced to 5 per cent., the saving under the head of collection would be 1,300,000/. The circumstance of the charge of collec- tion continuing so high, is a proof that there must be, somewhere, great fault ; because much of late has been done for the purpose of diminishing it. This subject has been exa- mined into by three Select Committees of Finance, and at least three different Commis- sions of Inquiry ; and numerous improve- ments have been adopted at their sug- gestion ; the principal of which are, the abolishing of the several revenue bonds in * Finance Ace. Committee of Finance, No. II. p. 18 ; and No. III. p. 60. t Net Revenue. 124 COLLECTION OF Ireland and Scotland, and of the patent of- fices ; the consolidation of the duties and of the laws *, and the introducing of a great many regulations for promoting the despatch of business. As the result of the whole of the attempt to economise is an increase in the charge of collection, it shews the spirit of profusion still holds the mast erh and. It appears, from accounts laid before the Committee of Finance, that the revenue collected in 1827 from the customs duties, was received from 566 duties on as many different articles : — }•£ 17,683,445 8 18 articles produced £100,000 and upwards, making 9 articles produced 50,000 to 100,000 784,415 18 6 9 do. do. 25,000 to 50,000 370,066 17 1 20 do. do. 10,000 to 25,000 3/0,402 5 1 510 do. do. less than 10,000 585,072 G Miscellaneous articles 20,903 7 7 566 Gross Revenue £19,815,206 3 l£f * Too much praise cannot be given to those individuals who originated, and successfully carried into execution, in 1825, the plan of consolidating the revenue laws. t Paper of Com. Fin. No. 173, p. 11. THE REVENUE. 125 Thissweeping system of taxation shews that the customs' duties laws have been framed by persons but little acquainted with the principles of trade and finance, and not hav- ing the slightest consideration for the feel- ings and conveniences of individuals, or for the interests of foreign commerce. The effect of it is to render the accounts complex, and to generate smugglers. Prices are en- hanced with little or no advantage to the revenue ; the comforts and enjoyments of the people are uselessly abridged ; and a great deal of delay, vexation, and loss, must at- tend the collecting of duties on so many hundred commodities. Each of the duties on the 510 articles, which produce less than 10,000/., should be repealed ; the business of collection would then be confined to 56 articles, and the saving of expense in ma- nagement would, in all probability, be greater than the revenue (585,000/.), which would be lost by repealing these duties. The circumstance of the Excise revenue being collected at a low rate of charge per cent, is not a conclusive proof that there is 126 COLLECTION OF less profusion in this department than in the others ; for a large proportion of this revenue is paid by a few individuals, on operations carried on upon a large scale, and requiring the attendance of few officers in proportion to the sums derived from the duties, of which they have the charge. The regulations for collecting the duty on malt are carried to such an extent of unne- cessary, and, with respect to the trade, destructive details, that they afford direct testimony of the practicability of diminish- ing the number of officers employed, by simplifying the system of collection. In this case the zeal for securing revenue has so kept down the trade of malting, as to have made the consumption stationary for the last forty years ; whereas there can be no doubt that, if the trade had not been so harassed by excise rules, checks, and penal- ties, the consumption would have increased with increased population and wealth, and, consequently, the revenue derived from it. So that, in point of fact, the mistaken zeal with which the excise department has sought to THE REVENUE. 127 benefit the revenue, has produced a loss of at least from one to two millions a year on the article of malt alone. The stationary state of the glass manufacture, for a number of years, and of other trades subject to the excise laws, is to be accounted for, in a great de- gree, by ignorant and harassing regulations. Excise legislation, from being wholly in the hands of clerks, has been grounded on the narrow principle of grasping, by force of penalties, at the capital of manufacturers, in direct opposition to those enlarged and sound principles which would combine in harmony the interests of trade with those of the revenue. As no inquiry has been made into this department for a great many years, it is impossible to know whether it is well or ill managed : some circumstances have transpired, particularly with respect to the distilleries, which afford reason to suppose, that if an inquiry was instituted, occasions would be found for making many improve- ments, and saving a great deal of expense. Some of the duties of excise yield so 128 COLLECTION OF little revenue, that there can be no good reason for continuing them. The net reve- nue received in 1828 was as follows : — On cider and perry - • £37,233 Starch - - - 87,348 Stone bottles - - 3,405 Sweets and mead - - 2,606 Vinegar - 24,500 These duties are liable to the same ob- jections as those just made to the customs' duties, which produce little revenue, and ought to be repealed. The repeal in 1825 of those parts of the assessed taxes which were productive of a comparatively trifling profit to the revenue, forms a good precedent for repealing this class both of customs and excise duties. The net revenue from hackney coaches and pedlars, in 1828, paid into the exche- quer, was only 55,000/., and the charge for collecting the gross revenue of 77,437/. was at the rate of 13/. 18s. Id. per cent. The small amount of revenue, and large expense of collection, are good reasons for repealing these duties. There is no justice in making the inhabitants of London alone subject to THE REVENUE. 129 be taxed for hackney coaches. The tax on hawkers and pedlars has its origin in a notion that the public interest is benefited by protecting shopkeepers against the com- petition of itinerant dealers. As the trade carried on by them is particularly convenient and beneficial to the public, this penalty on industry should be removed. CHAPTER X. BOUNTIES. In 1827, 202,011/. was paid for bounties on linen and sailcloth exported*. The im- policy of this expenditure has been so far acknowledged, that an act was passed in 1828, for putting a stop to it on the 5th Jan. 1832 ; but this is too distant a period, and will occasion a considerable waste of money. In 1827, the following sums were paid for bounties for encouraging the Fisheries of Ireland and Scotland : — £. Out of Customs for Irish Fisheries - - 24,965 Out of Excise for Scotch ditto - - - 67,230 £92,195t By the 3 Geo. IV. c. 64, 3000/. a year is granted to the Commissioners of Scotch Fisheries ; and by 59 Geo. III., c. 109 § 66, * Paper, Com. Fin. No. 43, p. 2. f Ibid. BOUNTIES. 131 5000/. a year is granted to the Commis- sioners of Irish Fisheries. The professed object of encouraging the fisheries by bounties, is to increase the employment of capital and labour. The advocates of them, in this instance, adopt a theory of the most erroneous kind; for nothing can be more clear than that the increase of the employment of capital and labour in a country can only be the result of an increase of the general capital of that country, and cannot, in any way, be the re- sult of bounties raised by taxes. The bounty process consists merely in taking money from the pockets of one class of persons, and giving it to another ; and, therefore, it is wholly impossible that these bounties can be productive of the objects sought after. The more the question of bounties is ex- amined, the more clearly it will appear that it is impossible that any branch of industry can be in a sound state, that re- quires to be bolstered up by the aid of them, and that is subjected to the regula- tions of Commissioners, and the hourly in- K2 132 BOUNTIES. terference of the persecuting zeal of subor- dinate agents in inflicting the enforcement of these regulations. " If, as there seems no doubt, the fisheries afford the means of em- ploying labour and capital with advantage, the employment of them in this way will be a matter of course, as well as in any other department of industry. But if the fisheries be not a business of this kind, if they cannot support themselves without the aid of boun- ties, then it is plain that the persevering in this business cannot be of any real or lasting advantage*." It has been considered necessary to give this explanation of the waste of money in continuing these bounties, notwithstand- ing that by the law, as it now stands f , they are to cease on the 5th of April, 1830; be- cause the putting an end to them has, of late years, been so often enacted by law, and so often postponed, that it may be set down as certain, that every effort will be made * Wealth of Nations, Note of Editor, vol. iv. p. 430. t 7 Geo. IV. c 34. BOUNTIES. 133 to continue them. This has in part been done in a Report of the Irish Commis- sioners, but not signed by any of them, which was laid before the House of Com- mons in the last Session. The want of signatures to this report shews how re- gularly affairs of this kind fall into the hands of secretaries and other officers ; and that, in point of fact, bounties for public encouragement end commonly for their benefit. Instead of continuing these boun- ties, all regulations of the fisheries should be got rid of by repealing the laws for ap- pointing Boards of Fishery Commissioners, by which the expense of large establishments of secretaries, clerks, inspectors, &c. would be saved. By the 9th of Geo. IV. c. 76, the bounties on sugar exported are 9-10ths of the boun- ties granted by the 6 Geo. IV. c. 113, which were as follows : — £. s. d. Bastard, per Cvvt. ------ 1 JO Other refined Sugar, ditto - - - - 2 6 Double refined, ditto, an additional bounty of per Cwt. 080 134 BOUNTIES. That part of the bounty which is equal to the duty originally paid on the importing of the raw sugar is only a drawback; but the remainder of it, which is said by some per- sons, of good authority, to be as high as 6s. or 7*. a cwt., is a gift of so much public money, in the way of bounty, to the export- ing merchant, for the benefit of the West- India planters and the foreign consumers. In 1828, 456,844 cwt. of refined sugar were exported, and the amount paid as drawback and bounty, under the name of bounty, was 920,718/. Supposing the bounty to be 5s. per cwt., the sum paid out of the public purse, for the purpose of encouraging the sugar trade, and the particular advan- tage of the West-India sugar planters, was 114,211/. It is not easy to discover on what principle of justice or policy taxes are imposed on the people of the United Kingdom, for the par- ticular and special advantage of the owners of sugar estates in the West Indies. Why should 114,000/. a year be levied on the raw materials of British manufactures, for BOUNTIES. 135 the purpose of adding to the profits of the West-India planters, in their capacities as manufacturers of sugar, at the cost, and to the great injury of those manufacturers who make use of these materials ? What has now been said on the subject of the bounties on linen, fisheries, and sugar, shews that nearly 400,000/. may be saved by abolishing them ; and that there is not the slightest reason for not doing so. All this money is completely thrown away ; and surely it would be better to take off some tax on a raw material that now produces 400,000/. a year, than apply the public mo- ney in this useless manner. CHAPTER XT. THE MANAGEMENT OF THE PUB- LIC EXPENDITURE. The following is a list of the several depart- ments that are intrusted with the business of expending the public money, pursuant to the general appropriation of it by Parlia- ment. The sums which are paid for their establishments are stated as accurately as the documents respecting them will admit of: £. 1. The Treasury, including the Commissariat! Department, in 1827 - - - J ' 2. The Exchequer - - - 4 8, 00 Of 3. The Audit Office, in 1828 ... 32,977$ 4. The Bank of England, do. - - 267,597$ 5. The Commissioners of the Sinking Fund, do. 10,350|| 6. The Civil Departments of the Army, do. - 108,837«!F 7. Ditto of the Navy, do. . - - 179,647** 8. Ditto of the Ordnance (the Tower and Pall-1 mall), do. \*WHt £779,911 * Paper of Com. of Fin. No. 102. f lb. No. 27, and Par. Pap. 1822. No. 110. $ An. Fin. Ace, 1828, p. 137. § lb. p. 134. || lb. 134. f Army Estimates, 1828. ** Navy Estimates, 1828. tt Ordnance Estimates, 1828. PUBLIC EXPENDITURE. 137 This account shews only the expense of the civil establishments in London, and therefore falls very far short of shewing what the total expense is of the civil establish- ments of the military departments. The Treasury. — It appears, by a paper laid before the Committee of Finance, that the expense of this department, which is now 80,542/. was, in 1797, 44,066/.— so that it has nearly doubled since that time. Although the income and expenditure, the superintending of which constitutes the chief business of the Treasury, of 1797, was as great as the income and expenditure of 1827. As the Treasury exercise the same powers, and discharge nearly the same duties now as they did in 1797, this immense increase of expense in the establishment of a depart- ment whose duty it is to control the other departments, is alone sufficient evidence of the profusion with which salaries must have been increased, and officers multiplied. There are no fewer than fifteen clerks in the Trea- sury, who receive salaries amounting to 138 MANAGEMENT OF 1000/. ; five of these fifteen receive 1500/. a year each, and upwards*. Nothing can more fully shew the want of system and uniformity on the part of those persons by whom public business has been originally regulated, and the necessity of revision and reform, than the mode by which the Treasury establishment is paid — for instance, some of the salaries are paid out of the Civil List ; some out of a fee- fund ; some out of the Customs' revenue, and some by an annual grant of Parliament. Such kind of complication must lead to great perplexity and confusion of accounts, and frustrate all efforts to keep down the ex- pense of official establishments. The Exchequer. — It is so generally ac- knowledged that the forms by which bu- siness is carried on in this office are anti- quated and absurd, that it would be wasting time to give any description of them ; and as there seems to be but one opinion with respect to the expediency of abolishing this office, as an expensive and inconvenient * Paper No. 102. PUBLIC EXPENDITURE. 139 mode of doing business, what deserves most to be attended to is, the consideration of the sort of office which should be substituted in its stead. As the chief duty of the Exche- quer, so far as the public money is con- cerned, is to take care that no issues of it are made by the Treasury without their being in conformity with the authority spe- cially enacted by Parliament, it ought to be easily and effectually performed by a small department, consisting of a few officers, and occupying only a few rooms. The Audit Office. — Little need be said here concerning this office ; for if a proper system is adopted for keeping the public accounts, it will be necessary to make a total change with respect to its present functions, or perhaps wholly to get rid of it. Management of the Debt. — The Bank of England annually receives about 270,000/. for its trouble in paying the dividends. This is a very extravagant misapplica- tion of the public money ; for had the government made a proper bargain with the Bank, they would not have allowed it the 140 MANAGEMENT OF benefit of exclusive privileges in carrying on the trade of banking, and of hold- ing several millions of balances of public money free of interest, without having re- quired them, as a condition of these advan- tages, to pay the dividends. In the nume- rous discussions which have taken place on this subject in the House of Commons, the extravagance of the arrangement has been but little disputed ; but it has been suffered to continue on the ill-supported plea that it was binding on the public so long as the pre- sent charter had to run. As this is now so near its close, the advantage the Bank de- rives from holding the balances of the public money should be taken into account, in making any new arrangement with them respecting the dividends, so that the whole of the sum now paid for the management of the debt may be saved. The Civil Departments of the Army. Paymaster of the Forces. — The office of the Paymaster of the Forces is a sinecure. The business of it is performed by a deputy PUBLIC EXPENDITURE. 141 and three cashiers. As each of these per- sons has a power of drawing money out of the Bank of England on his own order, the effect of this office, being a sinecure, is to diminish considerably the security of the public. It is also attended with this further inconvenience, that it multiplies the number of imprest accountants, and thus adds to the difficulty of establishing a proper system of keeping the public accounts. The true remedy for these evils is, to adopt an entirely new principle for the ma- nagement of all payments of public money, by having one department for this purpose, instead of a paymaster or treasurer for each department. How this may be carried into effect will be explained after the examination of the offices of the treasurers of the navy and ordnance, and of other pay offices. Comptrollers of the Army Accounts. — Strange as it may seem, the office of Comp- trollers of Army Accounts has nothing to do with the accounts arising out of the money voted in the army estimates ; these come 142 MANAGEMENT OP under the War Office. The Comptrollers' office ought to be called that of Auditors of a portion of the Accounts of the Army Extraordinaries. Army Extraordinaries. — Nothing can be more opposed to every principle of simplifi- cation and consolidation in conducting public business than the account which is called the army extraordinaries. The best-in- formed official men admit that it leads to a great confusion of accounts, and can only be intelligible to persons who are in office, or who bestow a great deal of time in un- ravelling it. The vote of parliament for the army ex- traordinaries is explained, as " not being matter of previous estimate or specific grant*", such as is contained in the army estimates. It includes, among other items, the pay, clothing, allowances, recruiting, &c. for the forces serving in India ; and, although the sum annually voted is no more than 800,000/. or 900,000/., the payments * Report of Messrs. Brooksbank and Beltz on Public Accounts, p. 55. PUBLIC EXPENDITURE. 143 that are made, and stated in the annual ac- count, which the paymaster of the forces lays before parliament, commonly amount to 3,000,000/.* This arises, in part, from pay- ments made nominally for army extraordina- ries during the year, comprehending a consi- derable number which do not belong to that head of service, but which are of the nature of temporary advances for other services provided for by parliament, and which it is convenient to pay, in the first instance, under the name of army extraordinaries, and afterwards to adjust by repayments from specific grantsf . The consequence of thus making the paymaster of the forces pay for those services that are not belong- ing to the army, is, the producing annually to parliament of an account with a perfectly false title. This scheme of army extraor- dinaries serves to conceal from parliament and the public a great deal of wasteful and illegal expenditure : for instance, the sums paid at home to colonial agents, and the sums drawn from abroad for colonial ex- * Report of Messrs. Brooksbank and Beltz, p. 53. t lb. 3. 144 MANAGEMENT OF penses, although they are wholly for civil colonial purposes, are paid as army extra- ordinaries, and without any previous vote of parliament ; in point of fact, as what con- stitutes, in reality, the vote of the army extraordinaries, is the balance of the ac- count of every expense called by this name, and any expense may be so called, there is no kind of expense that may not be covered by this sort of parliamentary sanction. As there would be no difficulty in putting into the army estimates the expenses to be incurred for the forces serving in India, these expenses, and all other military ex- penses that can be specified, which are now voted in the mass, and without being named in the army extraordinaries, should be put into the army estimates ; and also such a sum as might be wanting for other military expenses which could not be specified, but the heads of which may be stated. In this way the vote for the army extraordinaries would be got rid of, and the whole of the army expenditure would be brought into the War Office, and placed under a uniform and systematic control with the rest of the PUBLIC EXPENDITURE. 145 military expenses. A further advantage would be gained by this arrangement, — namely, the getting rid of all pretext for continuing to keep up the office of comp- trollers of army accounts. The payments which are made for other services, under the name of army extraor- dinaries, should be made in some new way, so that the use of the military chests under the care of the commissaries abroad may be continued, and so that the several branches of the public services may be furnished with the same kind of banking facilities and con- veniences, as they now have. The Commissariat. — There are some cir- cumstances belonging to the Commissariat which call for observation. The first is, that of the business of providing bread, meat, forage, fuel, and candles for the army and artillery in the United Kingdom, and fuel and candles for the troops on foreign stations, being under the management of the Trea- sury ; for so it is, in consequence of the Commissariat department being a part of L 146 MANAGEMENT OF the treasury. It is said, that the govern- ment wished to transfer this business to the Ordnance in 18*22, when the providing of other military stores was transferred to it ; but that the then master-general objected to it. The peculiar unfitness of the treasury to transact this kind of business, and the fitness of the ordnance for it, shew that the transfer of it should not be longer de- layed. The next circumstance to be noticed re- lates to the accounts of the commissaries. As they are necessarily both cash and store accountants, the course adopted in examining and auditing their accounts shews with what negligence the modes of doing public busi- ness have originally been arranged : for those accounts which relate to pecuniary expenditure are audited by the Audit Board, while the store and provision accounts are committed to the exclusive investigation of the comptrollers of army accounts. So many obvious considerations lead to the conclusion, that the entire accounts. PUBLIC EXPENDITURE. 147 whether cash or store, of a public accountant, ought to be simultaneously examined by one and the same department, that an alteration in the present system should be immediately made*. The employing of Commissaries of Ac- counts abroad was suggested in consequence of the great accumulation of accounts during the war ; but since the conclusion of it, the motives which originated the plan have gradually ceased to have any force, and therefore the public may be saved the ex- pense of keeping up any Commissaries of Accounts f. Army Agents. — It would appear that there is no necessity for incurring the expense of having Army Agents. The accounts of the paymasters of regiments are examined at the War Office, and not by the agents ; and all the agents do for the public, is to receive money from the Paymaster of the Forces, and to pay with it the drafts of the re- * Report of Messrs. Brooksbank and Beltz, p. 107. t lb. p. 107. L 2 148 MANAGEMENT OF gimental paymasters : their other duties are private, and for the benefit of the officers of the army*. The measure which would the most con- tribute to diminish useless expense, and secure an efficient performance of duty in the civil departments of the army, is the constituting of an Army Board, to be com- posed of the heads of each chief branch of the service, on the plan of the Ordnance Board. By doing this, a more concentrated direction would be established, and the whole control of the army expenditure would be rendered more effectual. A pre- cedent for such an arrangement for conduct- ing military affairs, is afforded by the Army Board which presides over and manages the East India Company's army. This board is composed of the Commander-in- * Evidence of Lord Palmerston, before Committee of Finance, p. 234 and 219. The whole of the evidence given before the Committee of Finance having been laid upon the table of the House of Commons, as well as all the papers and accounts which the Committee called for, it is quite regular to refer to them as public documents. PUBLIC EXPENDITURE. 149 Chief, as President ; the General Officer commanding the Presidency Division of the army, as Vice-President; the Chief En- gineer, the Commandant of the Artillery, the Quarter-Master General, the Adjutant- General, the Commissary-General, and the Military Auditor-General. In this board, as in the English Ordnance Board, there is an individual responsibility and duty, super- intended by the general control of the indi- viduals themselves, in their capacities as members of the board*. Army Accounts f. — It would appear from * Paper, Committee of Finance, No. CLI. Answers of Mr. Brownrigg. f The Committee of Finance, soon after they were ap- pointed, suggested to government the expediency of having an inquiry made into the methods employed of keeping accounts in the public offices. Accordingly, Messrs. Brooksbank, Beltz and Abbot were appointed commis- sioners for this purpose. It appears that the two first- named gentlemen have not acted with Mr. Abbot; in consequence of which, they have presented one Report on the Accounts to the Treasury, and Mr. Abbot has presented another. Both have been laid before parliament, and printed. 150 MANAGEMENT OF the Report of Messrs. Brooksbank and Beltz on the Public Accounts, that the mode of examining the regimental accounts an- swers every purpose ; and that but some slight improvements are wanting, to make the mode of keeping the accounts of the Pay- Office efficient. They say, ""That the books neither of the Navy- Office, of the Victualling, nor of the Ordnance, will enable those departments to furnish an account of receipt and expenditure, according to the heads of the estimates, with the like facility as the books of the Pay-Office." Mr. Abbot, the Third Commissioner of Accounts, has not made a Report on the Army Accounts. There are persons who have some acquaint- ance with them who say, that they are full as imperfect as the accounts of the other departments. The Civil Departments of the Navy. Treasurer of the Navy. — According to the evidence of Mr. Keith Douglas, before PUBLIC EXPENDITURE. 151 the Committee of Finance, the office of Trea- surer of the Navy is a nominal office, with- out any necessary duties to discharge, and without any fixed responsibility*. And Sir George Cockburn said, " I have always thought that the Treasurer of the Navy ought to be an efficient officer in his post, instead of being, as now, one of the officers of state, holding the situation nominally, on account of the salary. It is a thing I have always thought wrongf ." In consequence of this office being a sinecure, the business of it is done by a paymaster and three cashiers, who have powers to draw for money on the Bank of England. This mode of doing the business of making Navy payments, diminishes the security of the public ; and by creating so many accountants of imprest money, adds considerably to the difficulty of establishing a proper system of keeping the public ac- * Evidence before the Committee of Finance, p. 98. •(• lb. p, 69. 152 MANAGEMENT OF counts. The remedy for these evils is that plan which has already been proposed with respect to the Army Pay-Office; namely, making all payments of public money the business of a distinct department. Nothing can more conclusively shew the stubbornness with which public offices cling to antiquated and absurd practices, and how far they will go in shutting out modern im- provements, than the circumstance of conti- nuing to send money in waggons, under officers called conductors, and with military escorts, from the Navy Pay-Office to the sub-cashiers at the ports *. The Navy Board. — According to the evi- dence given before the Committee of Fi- nance, by Sir George Cockburn, Sir George Clarke, Mr. Douglas, and Mr. Barrow, it appears, that of late years the Admiralty have made various efforts to reduce the civil expenditure of the navy. It seems, however, that they were so much opposed, * Evidence Com. Fin. p. 63. PUBLIC EXPENDITURE. 153 as to be able to accomplish in this de- partment only some trifling reductions ; but that, with respect to the Victualling Office, in consequence of the Commissioners having zealously co-operated with them, a very great reformation and saving of expense has been effected. In the last session the old Navy Board was abolished, and a new one formed, according to the suggestion of the Committee of Fi- nance, on the model of the Ordnance Board. As the evidence just referred to explains the practicability of making some considerable reductions in this department, this change should lead to a large saving of the public money. Some doubt may, however, be en- tertained of the reform of the constitution of the board being as effective as it ought to be, in consequence of the same individuals having seats in it, who have hitherto been backward in promoting measures of reform and retrenchment. Had the Com- mittee of Finance been renewed, so as to have had it in their power to make a report on 154 MANAGEMENT OF the Navy, they could not have avoided to censure, in strong terms, the conduct of the Navy Board, in persevering to resist the su- perior authority of the Admiralty. Dock-yards at Home. — The sum voted for the dock-yards at home, in 1828, was 150,682/. The evidence given before the Committee of Finance makes it quite clear, that a considerable reduction of expense might be secured by a change of system in this branch. The following is an abstract of the evi- dence referred to : — Mr. Douglas says, " It has occurred very strongly to myself, and to other persons who have visited the yards, that the returns which are made from them daily, weekly, monthly, quarterly, and annually, are much more volu- minous than are necessary for any practical use*." Sir George Cockburn says, " In the pre_ sent good state of our navy a still further * p. 100. PUBLIC EXPENDITURE. 155 reduction of workmen in our yards might be permitted*." Mr. Barrow says as to the dock-yards, "■ With respect to superintending officers, perhaps we might be able to reduce some of the principal officers. The inferior offi- cers may certainly be reduced considerably, mostly among those, I should say, below the situation of foremen of the yard ; such, for instance, as the masters of trades. There is not a single trade, I believe, carried on in the dockyard, which has not a master. There is a master smith, bricklayer, sail- maker, rigger, rope-maker, painter, and others. They have each 250/. a year, and many of them have not above four or five men under their superintendence-)* ." " In Sheerness the master bricklayer is receiving 250/. a year for superintending five common bricklayers." Mr. Barrow, in further speaking of these masters, says, he prefers giving pay to giv- * p. 15. f p. 116. 156 MANAGEMENT OF ing salaries, on many accounts ; and adds, *' It is one of the greatest evils of our dock- yards, that the Commissioners of Naval Re- vision thought it necessary to bring forward so many working people, as the inferior officers all were, and to make them at once salaried officers ; the consequence of which is, that they have not only large salaries, but are all of them entitled to large super- annuations." lC Of this," he adds, " there is a striking instance in the estimates : a measurer, originally taken from the working shipwrights, where he had only about 60/. or 70/. a year as his day pay, the moment he became a measurer, had a salary of 180/. a year : he now stands upon the superan- nuated list with a retirement of 165/. a year ; and if his place is filled up, the public is paying 345/. a year for the labour of one measurer." Mr. Barrow, after repeating, " It is in the number of inferior officers that very considerable reductions can be ex- pected to be made," says, " of the mea- surers I find we have seventy-four ; their employment is that of ascertaining the earn- PUBLIC EXPENDITURE. 157 ings of the workmen ; and they are attended by twenty-five clerks who calculate those earnings. The measurers merely give in a certain number of figures, which the clerks understand, and from them they calculate the earnings. The amount of the salaries of these measurers and clerks is about 17,000/. a year." The excuse that is made for employing so many measurers and clerks is the quantity of detail of measurement, which is required in consequence of the Commissioners of Naval Revision having substituted a new plan of building by task work in place of the old one. Mr. Barrow says, " the Commissioners of Naval Revision altered the old plan greatly for the worse. The practice was, to divide a ship into a certain number of sections, which I believe was twenty-five ; each of these sections had a price affixed to it, according to the size of the ship ; to each section was a gang or more of shipwrights as might be necessary, according to their numbers, to complete the work of those separate sections." " In place of dividing 158 MANAGEMENT OF a ship in that manner into sections, we have upwards of 1000 separate articles, into which our measurers must go, and some of which, ridiculous as it may appear, are not valued at more than three farthings." Mr. Barrow stated the following comparison be- tween the management of a private yard and one of our dock-yards. " I have an account of the establishment of a private builder ; he has two hundred and fifty shipwrights. In Woolwich yard, which comes the near- est, we have two hundred and forty-eight shipwrights, eighteen clerks, six masters of trades, eight foremen, eight measurers, eleven cabin keepers ; besides surgeon, boatswain, and warders, and other people. " In the private yard, where I said there are two hundred and fifty shipwrights, there is one foreman, one measurer, two clerks, and ten labourers." Mr. Barrow says, " If I wanted a ship built of 500 tons, a private builder would estimate the workmanship at 48*. per ton, though he might charge me more." On Mr. Barrow being asked i( At how much PUBLIC EXPENDITURE. 159 per ton is a ship of 500 tons in the King's yards built?" he answered, " A great deal more than that ; for it takes in the whole expense of superintendence as well as la- bour. I must observe, that it is not quite fair to compare the two yards together, be- cause we have all the trades working in our yards ; the private proprietor goes to others. I mention this to shew the simplicity of one proceeding, and the complexity of the other. The Acteon sloop of war, 455 tons, is esti- mated to cost 51. a ton in our yard ; but then there is no doubt that our ships of war are much better built than those in private yards." Mr. Barrow further states, that the build- ing of thirty-two ships in Pembroke yard cost 251. a ton, including workmanship and materials, and every expense of the esta- blishment. On the general subject of the great cost of our establishments for providing the su- perintendence of labour in the dockyards, Mr. Barrow gives the following evidence : — "To give the Committee some idea of 160 MANAGEMENT OF the quantity of superintendence exercised by those officers, and of the quantity of work performed by the artificers, I have drawn out a few of the proportions from the last year's estimate. The whole establish- ment of the officers and clerks, and other salaried persons, at the dock-yards at home, amounts to about 155,000/., and the amount of wages paid for work done by artificers, labourers, &c, was 502,000/. These sums will give the price paid for superintendence, &c, to that for labour, or unproductive to productiye labour, as 1 to about 3 and i ; that is to say, for every three pounds and a quarter paid to the men, there is one pound paid for superintendence and other expenses of the yard, which is cer- tainly enormous. I do not mean to give this as a strictly accurate statement, but it will come pretty near to the truth. In Dept- ford dock-yard the proportion thus taken was as 1 to 1 and -^ ; in Woolwich, as 1 to 2 and -j\ ; in Sheerness, as 1 to 1 and | ; in Chatham, as 1 to 3 and T 5 ¥ ; in Portsmouth, as 1 to 3 and T V ; in Plymouth, 1 to 4 and PUBLIC EXPENDITURE. 161 T V ; and Pembroke, 1 to 4 and T V. It is fair to say, that in the amount of each esta- blishment are included watchmen, warders, and those inferior persons whose salaries amount to a considerable sum, I believe to somewhat about 15,000/. a year in the whole ; but that will not make much differ- ence in the proportions ; but, deducting the expense of the duties performed by the clerks and some other contingencies, the superin- tendence to the earnings will be generally about 1 to 6. I believe there is no pri- vate establishment, and certainly no public one, in any foreign country, in which the superintendence and the labour bear any- thing like that proportion. In one of the principal dock-yards of France, the super- intendence bears a proportion to the labour of 1 to 22 J ; but there I think it also right to observe, their mere labourers are all con- victs, which will make a considerable differ- ence ; they are superintended by a military guard, placed round the naval yard." Navy Accounts. — According to Mr. Abbot's report on the Accounts of the Navy and Navy M 162 MANAGEMENT OF Pay Offices, it appears that there is a want of a clear distinction between the duties of the account branches in the Navy Office and those of the Treasurer of the Navy ; that the opera- tions of one run perpetually into the other*; and that great labour is unnecessarily ex- pended in filling up, on printed forms, cash orders to be attached to original bills and other documents as warrants for payments by the treasurer f. The present system of Navy Accounts is described by Mr. Abbot as altogether dis- jointed, made up of many elaborate branches, but without a trunk to which to unite them. The abstracts, which are formed at the ex- pense of much labour, do not carry with them any such criteria for the proving of their correctness as would satisfy any pro- fessional mercantile accountant. Mr. Abbot shews, in the clearest and most satisfactory manner, that if the accounts of the Navy Office and Navy Pay Office were kept according to the Italian or common * p. 4. t p. 5. PUBLIC EXPENDITURE. 163 mercantile method of book-keeping, great savings of expense in officers, clerks, and stationery would be the result. In the Navy Pay Office, where the pay- ments made by the treasurer now employ three cashiers, and about thirty clerks, three sub-cashiers and three subordinate clerks would be sufficient *. When a claim is now made for a payment, after being examined in the branch of the department to which it belongs, it is sent to the office of bills and treasurers' accounts, and then to the board, where a bill is made out on the treasurer ; he keeps this bill when presented to him, and gives in its place a check on the Bank. Mr. Abbot proposes to avoid this multifarious course of useless operations, by having the claim for a payment made by a bill drawn on the board by the person who makes the claim : by the board accepting it on the certificate of the first examiner's office, and then by the treasurer countersigning it, so that the *p. 7. M2 164 MANAGEMENT OP bill shall be the order on the Bank for pay- ment*. Mr. Abbot says, that in the Wages branch of the Navy Office, twelve books, which are now kept to check the treasurer's payments, might be discontinued. He pro- poses the consolidation of the wages branch with the ticket and allotment branches ; and says that the advantages to be derived from it would be the simplification of the ac- counts, and the reduction of labour, by keeping one copy of many accounts instead of two f . At present the payment of officers' and seamen's wages is made in the presence of four clerks, in order to have three clerks checking the accuracy of every sum paid by the fourth. As these clerks are selected from different branches, and as each keeps a book, so many books are kept in tripli- cate, that no less than 1580 supernumerary books are annually kept J. Mr. Abbot proposes that the officers' and seamen's wages should be paid by the * p. 7. t p. 9. % lb. PUBLIC EXPENDITURE. 165 pursers ; and says, if this plan was adopted, more than one-third of sixty-one books in the wages office, and a yet larger propor- tion of about ninety books in the ticket office would no longer be required *. Mr. Abbot recommends that the office for foreign and home accounts should take charge of the promiscuous and imprest re- gisters, now kept in the office for bills and treasurers' accounts ; that the contract and store departments should be consolidated ; and that the business of condensing accounts relating to cash payments, now done in the office of bills and treasurers' accounts, should be conducted in an accountant's department. He says that the bulky and unsatisfactory abstracts now prepared in this department, would be superseded by the more accurate and comprehensive balance-sheet to be ob- tained from the ledger and journal, when properly kept in the accountant's office f . Mr. Abbot observes generally on the pre- sent system of navy accounts, that there is * p. 16. tp. 11. 166 MANAGEMENT OP a great variation of record, without a dis- tinction of purpose ; that the whole of the business of the accountants' department is so entirely devoid of system, that no sound repairs can be made of it; and he adds, the annual payments are at present so limited in number and amount, that there would be no difficulty in uniting them all into one cash book, and transferring every item in detail to the journal, preparatory to forming the ledger. Messrs. Brooksbank and Beltz, in their joint report on the public accounts, agree in several of the statements made by Mr. Abbot upon the navy accounts. They say, " Upon our examination of the accounts of the Navy Office, it appeared to us that they had been modelled more for the purpose of checking the accounts of the treasurer of the navy, than for affording any explanatory detail of the naval expenditure * ; that the expenditure is scattered and distributed in different books, and the process of preparing * p. 18. PUBLIC EXPENDITURE. 167 any detailed account from them has been done by means of a large and broad sheet of paper, divided into partitions and squares, in which the sums are entered from the re- gisters, according to the items of expenditure required. This is the substitute for a regular ledger ; and the great defect of the old system of account is the want of a good general cash book and a proper ledger.*" Paymaster of Marines. — The duties which are performed by this officer have such a close connexion with those of the Navy Office, that it would appear to be advisable to abolish their separate character. As to the reasons that are given to the contrary, they are so plainly nothing more than ingenious pretexts for maintaining a lucrative office, that it would be a waste of time to notice them. New duties have been given to this office, such as the clothing of the marines, and other expedients have been resorted to for the purpose of giving importance to it. Mr. Abbot says, on this office, the accounts * p. i {>. 168 MANAGEMENT OF partake of the fault common to all the go- vernment offices, in having a great variety of books, an evil arising from the want of a well-arranged plan of account. Each description of expenditure has its distinct set of books, making thirty-three in all ; but in a department of such limited extent, this cannot be necessary. Books are also made up for each separate branch of expen- diture at a great expense in clerks, all of which would be superseded by as many separate heads of accounts in a general ledger*. Besides the books just mentioned, a great number of unnecessary books are kept of the accounts of the sub-accountants f The Victualling Office. — It has already been stated, that of late a great reform has been made in the Victualling Office. What is still wanting is to remodel the board on the plan of the Ordnance Board, with a smaller number of commissioners. In this department, as well as in that of the Navy Board, it is the practice to manu- * p. 83. t p. 86. PUBLIC EXPENDITURE. 169 facture a variety of articles instead of pro- viding them by contract* . This practice is attempted to be defended on the ground that those articles are provided in this way cheaper and better than they could be pro- vided by contract ; but such a defence rests upon what is morally impossible. This de- fence cannot be supported, because private manufacturers can buy materials cheaper, and take better care of them ; and they can get labour cheaper, make it go further, and superintend it better, and at a less ex- pense than any public office. The success of a public office in manufacturing depends on what it is impossible it can accomplish, namely, to find numbers of officers willing to work with the same zeal and integrity for the public as they would work for them- selves. It is obvious that the slightest deficiency * The following articles are manufactured by the Navy Board, viz. lead, paint, canvass, chain cables, blocks, cop- per, and iron, rolled, and several others. The following are manufactured by the Victualling Board, viz. bread, beer, and flour ; and cattle are bought and salted. 170 MANAGEMENT OF in skill, activity, and integrity, on the part of the public officers, in performing the various operations, from their going to mar- ket to buy a stock of raw materials, to the storing of the goods made with them, will be taken advantage of by numbers of per- sons in numberless ways. Materials will be bought in too dear ; they will be wasted in working them up ; they will be liable to be stolen or damaged ; and the finished articles will be more exposed to be wasted and stolen than when purchased by contract, from the difficulty of keeping equally exact account of the quantities received and de- livered. Although the Victualling and other offices, that carry on manufactures, produce accounts by way of shewing that they make them cheaper lhan they can be got by contract, this does nothing towards supporting their case, because their accounts are all kept in so imperfect a manner, that they cannot be relied on. "With respect to contracts, it may be con- fidently maintained, that every thing, by PUBLIC EXPENDITURE. 171 proper management, may be got, through them, of the best possible quality, and at the lowest possible price. The contract prices of the best articles, under a system of free competition, cannot exceed, on an average, what is just sufficient to pay, first, the cost of materials, when purchased at their lowest price ; secondly, the labour of work- ing them up, managed with the greatest skill and economy ; thirdly, the ordinary rate of profit on capital employed in trade. To suppose that contractors can, by any means, force public offices to pay prices beyond what can be justified by these three com- ponent parts of the prices of commodities, is to shew a great want of acquaintance with the principles which govern prices — a fault, however, very common with many official men ; who still, however, have great weight with higher authorities, as possessing supe- rior means of forming correct opinions on these matters. The fact, therefore, of con- tract prices being always kept by competi- tion as low as the combination of manufac- turing skill, perfect economy, and a very 172 MANAGEMENT OF low ordinary rate of profit can keep them, it is utterly impossible that public offices can themselves manufacture any article at as low a price as it can be got for by a con- tract. With respect to the quality of con- tract goods, this may be secured without the slightest risk of fraud or disappointment, by having proper specifications and deeds of contract, and by enforcing a strict inspec- tion. The Committee of Finance say on this subject in their Second Report: " The Committee are not disposed to place implicit reliance on the arguments which have been urged by some public de- partments against contracts by competition, and in favour of the superintendence and execution of work by themselves. The latter plan occasions the employment of a great many officers, clerks, artificers, and work- men, and not only adds to the patronage, but to the appearance of the importance of a department. Nor can the Committee suffer themselves to feel any prejudice against the contract system, by references to some instances of failure. They believe PUBLIC EXPENDITURE. 173 that most cases of failure may be attributed to negligence or ignorance in the manage- ment of contracts, rather than to the system itself*. In the calculations of the prices of the articles that are manufactured by the public departments, the charge for residences, su- perannuation allowances, and other items, to the advantage of master millers, brewers, bakers, butchers, and a great many other officers, are never taken into account. If they were, and they certainly ought to be, the case would be so clearly against all office manufactures, as to justify the most decided prohibition of them. In the evidence given by Sir Henry Tor- rens and Mr. Serjeant, before the Commit- tee of Finance, it appears, that the Commis- sariat Department do not find the least dif- ficulty in providing bread, and other articles of food, of the best quality, and on rea- sonable and proper prices, by contract ; so that there is not the slightest reason for * Second Report, p. 23. 174 MANAGEMENT OF the Victualling Office continuing to be ma- nufacturers of flour, bread, &c. ; and it is equally clear, that the great sums of money which have been expended of late in build- ing flour-mills have been completely thrown away*. Accomits of the Victualling Office. — With respect to the method of keeping the ac- counts of the Victualling Office, Mr. Abbot says, " Considerable attention has been paid by the heads of the department to the plan now in operation ; and it has been puri- fied by much labour from a far more objec- tionable state : still so differently is it con- structed from any systematic plan of account, that, at first sight, it is unintelligible, even to one intimate with accounts ; and no man, not officially educated in the existing plan, would know how to set about the detection * Evidence of Sir H. Torrens, p. 205. — Q. The bread and meat are supplied by contract? — A. Yes. Q. Is it found by experience that good provisions are obtained in that way ? — A. They are so watched, that, generally speaking, very good provisions are received ; and it is quite impossible, that any attempt to give inferior provisions can be persevered in. PUBLIC EXPENDITURE. 175 in it of an error or fraud*." After describ- ing the great number of books that are kept, he says, " I feel quite confident that the in- troduction of a connected and well- arranged plan of account would, in the end, tend greatly to diminish the quantum of labour (consequently of expense) required for all purposes of account f ." Civil Departments of the Ordnance.— The Committee of Finance, in their Second Re- port, make the following remarks on some of the civil services of the Ordnance : — They say, "that, notwithstanding so much has been done in diminishing the expense of the Ordnance establishment below what it has been of late, it still is a much greater charge on the public than it was some years ago, and that government ought to institute an inquiry to ascertain whether it might not be further reduced^." They recommend, that the office of Lieutenant-general of the Ordnance should be abolished. They say, that if the duties of the board and of master- *p. 93. tp. 99. $p. IS. 176 MANAGEMENT OF general could be brought more together, the charge for clerks in the office of the master- general might be considerably reduced*. They recommend, that the whole establish- ment of the Tower should be removed to Pall Mall, except the part of it which is con- cerned with the storesf. They strongly condemn the practice of providing residences for public officers J. They recommend, that the medical department of the Ordnance should be united with that of the Army ; and that the medical stores for the Army and Ordnance should be bought by contract, as is the case in the Navy§ ; and they express a very decided opinion in favour of construct- ing all buildings by one contract for a whole work, instead of by several contracts for the several parts of it||. The following articles are manufactured by the Ordnance, viz., charcoal, gunpowder, gun-carriages, gun-sights, and swords. The reasoning which has been applied to the manufactures of the Navy and Victualling- * p. 13. t p. 20. % P- 23. § p. 24. || p. 25. PUBLIC EXPENDITURE. 177 offices is equally applicable to these manu- factures of the Ordnance, and need not be repeated — particularly that part of it which refers to the defective method of keeping accounts of the articles manufactured, and to these accounts being of no use as evidence of cheapness. Royal Woolwich Academy. — In 1828 the sum of 4,046/. was voted for the Royal Woolwich Academy. The clerk of the Ordnance, in giving his evidence before the Committee of Finance, defended this institution by shewing how good an edu- cation the cadets received at it. But the utility of it, however great, is not a sufficient justification for continuing it ; the necessity of it should be established by proving that good artillery and engineer officers could not be had without it. But this cannot be done, because what is taught at the Academy is quite elementary, and what can be learned just as well at private military schools. If instruction were made to begin at the Aca- demy, just where it stops at present, that is, when the cadets are seventeen or eighteen N 178 MANAGEMENT OF years old, then there might be some reason for keeping it up ; because the instruction afforded to officers might be of such a de- scription in the higher branches of military knowledge as could not be attained else- where*. The whole of that elementary knowledge, which a cadet now acquires at Woolwich at the public expense, might be completely secured by a proper examination of each individual, wishing to be an artillery officer, prior to his being appointed to a commission. Ordnance Accounts. — Mr. Abbot begins his report on the Ordnance Accounts with the fol- lowing paragraph : — ' f It appears, from the acknowledgment of all parties in this depart- ment, that the accounts were, some years back, truly complex and unsatisfactory. They have since been pruned with an unsparing hand, prompted no doubt by an anxious desire to simplify ; but, like most attempts to repair an ancient establishment, these efforts have tended more to disjoint the fa- * See Evidence of Sir H. Hardinge on the Senior branch of the Academy of Sandhurst. PUBLIC EXPENDITURE. 179 brie than connect and strengthen it. The projectors of the alterations in the accounts, to which alone this observation applies, (for a man must be more than blind who does not admire the beneficial arrangements in- troduced by his Grace the Duke of Welling- ton and Sir Henry Hardinge,) do not ap- pear to have been men of account; they seem, so to speak, to have been altogether unconscious of the following established prin- ciples in book-keeping : " 1st. To record nothing but facts. " 2dly. To record them in the manner they occur. " 3rdly. To record them under the precise date of occurrence. " Indeed the very names given to the dif- ferent books prove a total absence of all ac- quaintance with book-keeping. The terms ledger, journal, cash-book, are not applied to books of any similarity to those which accountants have so designated. In all their alterations the projectors have lost sight of that continued connexion between one book and another, until the whole centre in one n 2 180 MANAGEMENT OF condensing book ; an arrangement so essen- tial in every good system, it being the very end and object of accounts*." Mr. Abbot proceeds to say the Store branches will admit of considerable simplifi- cation, at the same time that they require a fundamental improvement, by the introduc- tion of the value of stores, in addition to the present records, which are confined to qua- lity and quantity f. He says the business transacted between the offices of the Clerk of the Ordnance and the Surveyor-General is circuitous and dilatory, and consequently expensive ; that there is unnecessary labour in making the Clerk of the Ordnance de- pendant on the Surveyor-General ; that the Clerk of the Ordnance, who is the account- ant of the department, is never able to shew its liabilities or engagements, from the con- trol of the accounts for purchases not being under his authority J ; and that the Sur- veyor-General keeps fifty-seven books, of which the greater part could be dispensed with, if the examination of accounts was * p. 117. t ibid. % p. 118. PUBLIC EXPENDITURE. 181 attached to the office of the Clerk of the Ordnance *. It appears from Mr. Abbot's report, that the Treasurer of the Ordnance has a power over the public money, which ought not to be vested in any public officer. If, for in- stance, he wishes to have the use of money for a few days, he may draw a check for any sum he pleases. He may draw the amount of debentures in his hands, for which the payees have not demanded payment, without the Clerk of the Ordnance being cognizant of the fact ; and as the Treasurer gets credit in the books of the Clerk of the Ordnance for the total amount of a quarter- book the instant it is sent forward to him, and as the demands for payments often leave a large balance in his hands, he can use this balance as he pleases f. Mr. Abbot shews in what manner all per- sonal power over the public money might be taken from the Treasurer, and that if he kept * p. 120. t p. 124. 182 MANAGEMENT OF proper books, two would serve the purpose of twenty-five now kept*. Mr. Abbot states that the books of the Ordnance Department, kept by the Clerk of the Ordnance, are not founded on the Trea- surer's half monthly statements, which are the only current Cash Account of the Ord- nance ; but in the imprest and cash jour- nals, which are fallacious as to dates, and liable to great variations from factf. In the Barrack Branch of the Ordnance Department, an originally perfect system of accounts has been changed into an imperfect one ; which proves, Mr. Abbot says, that " men of account" are not frequently to be found in the government officesj. Yet still enough of the good system is left to make the accounts superior to those of the Ordnance. •' There is the power and habit of balancing the books annually to prove their correct- ness." — "The books themselves are. gene- rally speaking, connected with each other, * p. 132. fp. 125. • $ ibid. . PUBLIC EXPENDITURE. 183 and not disjointed masses of accounts like those of the Ordnance*." Messrs. Brooksbank and Beltz, in their re- port on the Ordnance Accounts, find little or no fault with them. They notice the changes made by the First Lord of the Treasury when he was Master General, but do not follow Mr. Abbot's example in explaining their imperfections. Public Accounts. — Although the defects in the methods by which some of the public accounts are kept have been mentioned, it is of so much importance, that a proper system of accounts should be generally established, not only for the security of the public money, but as a means of making a great retrenchment in official establishments, that it may be of some use to examine this question somewhat more at length. With reference to the system in general, the reports of Messrs. Brooksbank and Beltz calls it vicious, complicated, and expensive ; without fixed rules clearly defined, and not *p. 128. 184 MANAGEMENT OF generally applicable ; a system framed in accommodation to the transactions of times remote from the present, and under circum- stances, which have since undergone con- siderable alteration*. Mr. Abbot says, every government office has its peculiar system ; and that if he were employed professionally to test the accuracy of any of the accounts, he would put aside every book in use, and, taking up the original documents, throw them into a totally new shapef. He adds, " As to the construction of a balance sheet, for the purpose of proving the correctness of the books, nothing of the kind has been at- tempted ; neither could the most diligent exertions accomplish that desirable object while the general system remains as at pre- sent t" It further appears from these reports, that there is no uniformity in the constitution and organization of the great departments that conduct the public expenditure, nor any uni- formity of classification of business by the * p. 88. f p. 73. $ p. 73. PUBLIC EXPENDITURE. 185 several branches of the departments. The Crown, even in exercising its prerogative to direct the issues of money by the Exchequer to the departments, does so in a variety of ways, sometimes by privy seal, sometimes by warrants ; and these have effect, some for the issuing of the whole sum voted by Parliament ; some for a part of it, some for the period of a year, and some for a whole reign. For want of a proper system of accounts, a great redundancy of unnecessary books are kept ; forms and checks are so multiplied as to occasion an infinity of useless copying, repe- tition, perplexity, and confusion ; business which ought to be done in one branch of a department is divided among several; so that the result of the whole system is the utter failure of accomplishing what the public accounts ought to do, namely, the affording of security against the negligence or dishonesty of accountants ; and secondly, the means of giving, with facility and promptness, infor- mation upon the several parts of the receipt and expenditure of the public money. 186 MANAGEMENT OF In selecting the principle on which a re- form of the present system of accounts should be grounded, it is necessary to take a much more extended view of the subject than the Commissioners, whose reports have been referred to, were empowered to take : for unless the constitution and organization of the great departments, and the classification of business in the several branches of them, are, in the first instance, revised and new modelled, pursuant to some uniform and simple plan, no attempt can succeed that may be made to establish an uniform, accu- rate, and perspicuous system of accounts. In observing upon the office of the Trea- surer of the Ordnance, the Committee of Finance say, they are induced to think the public has not that complete security against possible loss which it ought to have ; and that they postpone recommending any alter- ation until they can have an opportunity of proposing some system for regulating the payment of money in other departments — alluding to a similar w T ant of complete se curity in the Offices of Treasurer of the PUBLIC EXPENDITURE. 187 Navy, Paymaster of the Forces, and several other pay offices which had come under their notice. It appears, from a statement laid before the Committee of Finance*, that besides the pay offices just, mentioned, there are a number of individuals who receive money from the Exchequer, and have the power of drawing money out of the Bank of England by their own drafts. The evidence given by Mr. Serjeant before the Committee, shews, that besides being a paymaster to a very large amount, as Agent of Commis- sariat supplies, he is also Paymaster for the Civil Contingencies, for the repairs of Windsor Castle, for emigration to Canada, and for the Ecclesiastical Establishment in the West Indies, although nominally an Officer of the Treasury. The several sums of money which he receives for these services are placed to his account at the Bank of England, as Agent of Commissariat Sup- plies. In 1827, the sum which was at the * Paper, No. 252. 188 MANAGEMENT OF disposal of Mr. Serjeant, amounted to 2,00(>,000/. : he has sometimes a balance of 250,000/. at the Bank. He can draw, by his own draft, for any sum he pleases ; his clerk has the same power, and they do not give security*. It appears, from the evidence of Mr. Shearman, that he and three other officers of the Treasury are Paymasters of the pub- lic money to a considerable amount ; that they keep the money they receive from the Exchequer at their private bankers, and that they do not give security. These statements make it evident, that some great change is necessary in the whole system of paymasters of public money, as a preparatory measure for settling a proper system of public accounts. But to make such a change effectual, it should not be confined to reforming the defects in each office, but should be founded on a general principle of uniformity and security, to be applied to all kinds of payments of public money. * Evidence Com. Fin., April 21, 1828. PUBLIC EXPENDITURE. 189 As there is nothing in the mere act of paying money that has become due for the performance of a public service, connected with the circumstances of the service for which payment is to be made, there can be no reason why the business of paying money should not be taken away from the de- partments, and individual paymasters, and be placed under a small board of commis- sioners. If such a board were appointed, in every case where a payment was to be made, the board of the department to which it be- longed should send an order to the Board of Payments, as they now do to their pay- master or treasurer. The order should con- tain the particulars of the account for which the money was to be paid ; and before pay- ment was made, these particulars should be examined by the Board of Payments, so as to have an audit take place before payment. The Board of Payments, after being satis- fied as to the correctness of the order, should give a draft for the amount on the Bank of England, and then enter the payment in re- 190 MANAGEMENT OF gular account-books, of which a separate set should be kept for each general head of service. If this plan were adopted, 1st, the public would have the security of the signatures of the commissioners to each check on the bank. 2dly. There would be a continual auditing of accounts going on before pay- ment of money. 3rdly. The business of keeping the public accounts belonging to the payment of money would be relieved from difficulty and complexity by being placed under one controlling authority. What is now proposed with respect to se- parating the business of making payments, from that of superintending the expenditure and incurring the expenses for which pay- ment is to be made, has the sanction of the established and successful practice of the French government. The French laws on the public accounts display great attention and science in obtaining the object of esta- blishing a simple, uniform, and accurate plan ; and the result proves the wisdom of the measures which have been adopted. PUBLIC EXPENDITURE. 191 By the law of the 1st Pluvi6se, an viii. three Chests (caisses) are established in the Treasury — the third of which is to receive daily, from the general chest, the necessary funds for the expenses of the public depart- ments. Four paymasters-general are ap- pointed, as officers of the treasury, for re- ceiving the claims of the parties entitled to payments : one of them for the army, an- other for the navy, another for the public debt, and another for the remaining public services. The duties of these paymasters are to examine each item of expense, as set forth in the orders produced by the claim- ants, which they have received from the de- partments ; and, after being satisfied of their being in conformity with the powers vested in the departments, to give the claimants orders for payment on the paymaster of daily payments*. * This plan of making the business of paying money a distinct one from that of superintending the expenditure, was proposed in the 31st of the Resolutions on Finance, moved by the Author in the House of Commons in 1819. 192 MANAGEMENT OF After the revision and new-modelling of the constitution and organization of the several departments has been carried into execution, it will not be difficult to determine what plan of accounts ought to be esta- blished. Everything which Mr. Abbot has said in favour of the Italian system will be greatly fortified by such a reform, and by having a Board of Payments ; at the same time, that it will remove some of the grounds of objection made by Messrs. Brooksbank and Beltz to the Italian system of accounts. Mr. Abbot's proposal to establish the Italian system, in its purest form, in all the public offices, deserves to have great weight with Government and Parliament. As a professional mercantile accountant, he holds the highest rank; and he has acquired a full knowledge of official accounts by mak- ing the most of the powers vested in him for ascertaining the nature, description, and purpose of the several books used in each office. He has stated in a memo- randum, submitted by him to the Treasury, PUBLIC EXPENDITURE. 193 of the 28th of February, 1829, that for every hour passed by Messrs. Brooks- bank and Beltz in the offices examining the books of accounts, he had passed twenty ; and this statement was not contra- dicted in the observations of these gentle- men on this memorandum. To those per- sons who are practically acquainted with the Italian system of accounts, the reasoning on which Mr. Abbot founds his opinion of its being applicable to all official accounts can- not fail to be completely satisfactory. The contrary opinion of Messrs. Brooksbank and Beltz, however respectable it is, is connected with circumstances which justify some sus- picion of its soundness. In the first place, they evidently have had to form a plan of accounts for a most defective official system of transacting business ; and having always before their eyes this defective system, they have formed a notion of an official system of accounts as contradistinguished from the mercantile system. This is a fun- damental error that pervades all their views and all their plans; for if the official system o 194 MANAGEMENT OF of doing business were new modelled, and all the payments of money vested in a distinct department, there could be no such thing as an official system of accounts differing, in any respect, from the common mercantile system. Messrs. Brooksbank and Beltz cannot be blamed for not having proposed the new modelling of offices as a necessary element of a proper system of accounts. Their com- mission did not require them to do so ; and no one could expect that, filling, as they do, situations in the Treasury, they would take upon themselves to propose to abolish sinecure treasurerships, and to make such official changes, as would lead to turning a great number of clerks out of employ- ment. There are no grounds for the objection of Messrs. Brooksbank and Beltz to that part of the Italian system which requires the entries in the waste and cash books, to be transcribed into a journal, and afterwards into a ledger, wherein nothing more is shewn than the titles to the accounts and references PUBLIC EXPENDITURE. 195 to details in the journal*. The sole object of a perfect plan of accounts is security that those, who are entrusted with money, shall not be able to misapply it without a facility of detection. This is what the Italian system of entries in a journal does in so complete a manner, that it is adopted universally in all commercial countries in private accounts. But Messrs. Brooksbank and Beltz seek to do more than this ; they want, not only to provide this security, but, by one and the same operation, to obtain the means of making out returns to orders of Parliament for special accounts, merely by taking copies of the ledger. They say, " a public office, which is continually called upon for information upon a variety of sub- jects, should possess the readiest possible means of furnishing that information ; and to this end, the ledger should be made to contain a condensed, but more circumstan- tial detailed account of proceedings than is usually effected under the mercantile sys- *. p. 89. O 2 196 MANAGEMENT OF tern*," and they, therefore, propose to dis- pense with keeping a journal. But a ledger so formed from the cash book, without a journal, would bear no substantial similitude to a mercantile ledger, because the whole principle of utility and security belonging to the mercantile, or Italian system, consists in the manner in which the journal is kept ; so that Messrs. Brook sbank and Beltz propose a plan which sacrifices the security of the pure Italian system to the minor object of saving the trouble of referring to a regularly kept journal in making out accounts for Parliament. Messrs. Brooksbank and Beltz imagine they have obtained a triumph over Mr. Abbot, and a full exposure of his plan, in the circumstance of the deputy treasurer of Greenwich Hospital having determined, after Mr. Abbot had introduced his plan of accounts into this establishment, to keep a separate ledger for his own information and guidance ; but Messrs. Brooksbank and * P . PUBLIC EXPENDITURE. 197 Beltz omit to shew that the deputy treasurer possesses such a knowledge of accounts as to make him of any authority, or that he is free from prejudice in favour of old official and imperfect practices — without such being the case, their reference to his practice is good for nothing; — on the contrary, the inference that will be drawn from this act of the deputy treasurer is, either that he does not understand accounts, or that he is preju- diced in favour of old habits. The opinion of Messrs. Brooksbank and Beltz, that the official system of doing busi- ness requires an official system of accounts, different from the Italian system of double entry, is proved to be altogether untenable by the practice in France. In that country the Italian system is acted upon, in all the public departments, in its purest form, and all persons who have money dealings with the Government are ready to attest the great advantages of it. By the law of 1822, title 4, section 18, the different departments are required to keep their accounts on one uniform principle, 198 MANAGEMENT OF and to adopt the same regulations and forms ; and for this purpose it is ordered that each department shall keep a general journal, and a ledger, in which books they are to record immediately, and according to their date, all operations with respect to credits, orders for payment, and payments. These operations they are further to record in auxiliary books, to be determined upon by the number and forms of the different public services*. The journals are kept in every respect in strict conformity with the rules of the Italian system, and with the regulations of the com- mercial code. In consequence of the defective system of the accounts kept in our offices, it has been * " Titre IV. Des Comptes. — Nos ministres etabliront leur comptabilite respective d'apres les memes principes, les raemes procedes, et les memes formes. " A cet effet, il sera term dans chaque ministere un journal general et un grand livre en parties doubles, dans lesquels seront consignees sommairement et a leur date toutes les operations concernant la fixation des credits, la liquidation des depenses, l'ordonnance et le paiement. " Ces memes operations seront decrites en outre et avec detail sur des livres auxiliaires, dont le nombre et la forme seront determines suivant la nature des services." PUBLIC EXPENDITURE. 199 impossible to lay proper accounts before Parliament of the annual revenue and ex- penditure, and equally impossible to esta- blish a prompt and efficient system of audit- ing the public accounts. CHAPTER XII. CIVIL GOVERNMENT. The next head of expenditure to be ex- amined, with the view of ascertaining what retrenchment may be made, is that incurred on the offices for conducting the Civil Government of the country. They are as follows : — The King ; the Three Secretaries of State ; the Privy Council Office ; the Lord Lieutenant of Ireland ; the Civil Government of Scotland ; the Mint, and the Judicial Establishments. The annual expense of maintaining them may be esti- mated at about 2,000,000/.*, of which by far the greatest portion consists of salaries. * The imperfect mode of stating the accounts of the public expenditure that are laid annually before the House of Commons, makes it impossible to give an accurate ac- CIVIL GOVERNMENT. 201 The progressive increase of expenditure has been, in some of these offices, as fol- lows : — Secretary of State for the Home Depart-\ loon no, „„ ment J 1829 *31,916 1796 14,423 Increase - - £17,493 Secretary of State for the Foreign De~l 1ft0Q „~ ... partment .... J 1829 ±65,681 1796 34,495 Increase - - £30,186 Secretary of State for the Colonies - 1829 £39,624 1796 9,111 Increase - - £30,513* The Committee of Finance, in their se- cond report, point out, as one of the prin- count of the expense incurred under these heads. The following, however, will not be far from being correct. £. The Civil List 1,057,000 Three Secretaries of State - 137,000 Privy Council Office - - - 9,600 Ditto for Trade 11,400 The Lord Lieutenant, Chief Secretary, &c. of Ireland 100,000 Civil Government of Scotland - - 132,000 The Judicial Establishment of England - 150,000 Ditto ditto of Scotland 187,000 Ditto ditto of Ireland 147,000 £1,931,000 * Papers, Com. Fin., Nos. 103, 104, and 105. 202 CIVIL GOVERNMENT. cipal objects of economical reform, the re- vision of every office, for the purpose of introducing a principle of simplification and consolidation for transacting public busi- ness ; and there can be no doubt that, if this principle was effectually and universally adopted, the business of the public might be performed by a much smaller number of officers and clerks, and consequently at a less expense. The increased charge on account of the Civil List is much greater than the difference between what it was in 1761 and what it is above stated to be in 1829 ; because, in 1804, old charges on it, to the amount of 84,000/. a year, were transferred to other funds; and in 1816 further charges, to the amount of 255,000/., were transferred. As one of the chief grounds on which ministers proposed to Parliament the ad- vances which have been made in the amount of the Civil List, was the depreciation of money, now that this depreciation no longer exists, there is some reason for re-consider- ing the settlement of 1820. CIVIL GOVERNMENT. 203 The Catholic Question having been settled, there is not the least excuse for keeping up the office of Lord Lieutenant of Ireland. What has been said of other viceroys is fully applicable to the office in Ireland. " It seldom happens that viceroys can exercise their charge with advantage to the country over which they are temporary sovereigns. The instability of their power, and, too frequently, the desire to improve their own fortune, tend to withdraw them from any attention to their duties, beyond what is ne- cessary to keep all quiet. All measures tending materially to ameliorations must be necessarily slow ; the unpopularity which attaches to all wholesome innovations falls on the viceroy who introduces them ; while the merit which follows from them is given to his successors. On the whole, it is ge- nerally fortunate when a viceroy is con- tented to be merely passive in his office, and is negatively a clog on the improvement of the state. The situation being frequently given to some nobleman embarrassed with debts, or overwhelmed with a large family 204 CIVIL GOVERNMENT. or numerous dependants, it has often hap- pened that he has considered the country over which he is the ruler, less as a country to be fostered and rendered happy, than as a mine from which to extract for himself and his followers, within the shortest possible space of time, the greatest possible quantity of wealth*." As a great part of the sums granted for Irish miscellaneous services relate to mat- ters of civil government, this is the proper place to say, that if government carry into execution the recommendations of the Committee of the House of Commons with respect to them, a considerable saving of expense will be the consequence. There are several items which will admit of still greater reductions than the Com- mittee have proposed ; so that if all was done that might be done, at least 150,000/. a year might be saved. Salaries and Superannuations. — Having noticed, in a general way, nearly all the civil * For. Quart. Rev., vol. iv. p. 358. CIVIL GOVERNMENT. 205 official establishments, it is now time to say something concerning the rates of salaries in them. The Committee of Finance, in their Second Report, point out the general prin- ciples on which they ought to be regulated. They say the proper question with respect to them is, what course will best secure a perfectly efficient performance of the ser- vices of the public at the smallest expense 1 — They lay it down that the principle of competition is as applicable to the remune- ration given to clerks in the public offices for their time and trouble, as it is to the price paid for the time and trouble of other per- sons who live by the wages of labour ; and they add, that, as it is by this principle the salaries of clerks in commercial establish- ments are determined, the salaries of clerks in the public offices should be regulated by the salaries given to the former ; and that every exception in favour of a higher rate should be grounded on a clear case being made out, in every instance, of more talent and trust being required. The present rates of official salaries are 206 CIVIL GOVERNMENT. stated by the Committee to rank higher than those in commercial houses. Some of the witnesses examined by the Committee seem, according to their evidence, to have attempted to justify this, by assuming that in every public situation more talent and trustworthiness are required than in mer- cantile situations ; but this is not so, as by far the greatest part of the office clerks have nothing but common clerks' work to do. It is perfectly well known that, in those offices where the salaries are the lowest, namely, in the Commissariat, and the office of the Paymaster of the Marines, the work is best done. The clerks in the Commissariat are real clerks, not the sons of persons of the higher ranks, but of an humble description ; they are perfectly satisfied with what they receive, and do their work remarkably well. The Paymaster of Ma- rines says, in his evidence, that the salaries in his office are lower than in any other ; that he can place full confidence in his clerks, and has to place a great deal in them. CIVIL GOVERNMENT. 207 The more the question of salaries is exa- mined, the more fully it can be shewn that high salaries are not only the source of a great burden on the public, but also that they actually contribute to make the clerks less efficient, and, consequently, to the employing of a greater number of them. There cannot be a greater mistake than the notion generally entertained, that fitness will follow in proportion as the amount of the salary is high. Those persons who are willing to work for a small remuneration always have the greatest relish for work ; and therefore, giving low salaries will secure the filling of the offices with the most effi- cient clerks. On the other hand, when a clerk has a high salary, the less will be his activity, and he will be wholly adverse to anything like the drudgery of office. He will possess a greater facility for enjoying pleasurable and other trivial occupations. He will have a greater facility of obtaining accomplices in his transgressions, and in finding supporters to shield him against 208 CIVIL GOVERNMENT. being displaced, and against having his conduct thought disreputable. The present rates of salaries of officers and clerks place them in a much better situation than the remuneration given to that part of the clergy, who perform the laborious part of the church duties, and to officers of high rank in the army and navy. As the great pretext for raising all sala- ries to their present rates was the depre- ciation of money, now that the value of it is restored, the public have a right to require a reduction to be generally made on a large scale. As it appears from a Paper laid before the House of Commons, that the sum paid for salaries in 1827 amounted to 2,788,907/*, such a rate of reduction would produce a considerable saving. The Committee of Finance, in their Third Report, have pointed out the practicability * Par. Paper, Sess. 1828, No. 552. CIVIL GOVERNMENT. 209 of making a considerable retrenchment by means of a reform in the existing system of superannuation allowances. Since 1810, when the present law was passed, the charge for civil superannuations has increased from 94,550/. to 480,081/.* The Committee say this increase is enormous, and represent it as an evil that calls loudly for a remedy. They state that several abuses have arisen under the law as it now is, particularly from the disposition of the superior authorities to favour the retirement of efficient clerks ; they say they have been informed, that the cases are not few, in which persons super- annuated as unfit for public service, have enjoyed health and strength long afterwards, and have discharged active duties in other public offices, and in private business ; and they recommend that there should be a per centage reduction of all salaries, to form a fund for paying the superannuation allow- ances. Nothing can be more extravagant, and • Third Report Cora. Fin., Appendix, No. 13. P 210 CIVIL GOVERNMENT. inconsistent with a proper guardianship of the public money, than the system of sala- ries and superannuations now in operation. The salaries are so much higher than they ought to be, that every officer and clerk has more than means of making a provision for infirmity and old age. But notwithstanding this fact, as to the sufficiency of salary, in the true spirit of profusion, a great super- annuation allowance has been added. If the Committee of Finance had decided in favour of what was most proper to be done in the case, they would have recommended the abolition of all such allowances on future appointment to office : for, although it might be difficult for Government to resist the claims of hardship and real sufferings, which would, in that event, be made upon them, it may be considered as quite certain that in their hands, the sums which would be granted would never amount to what is now paid under the compulsory plan of giving to every officer a regulated allowance. It is quite impossible to explain why we are to have a privileged class in society, who, be- CIVIL GOVERNMENT. 211 cause they have once touched public money, are to be supported all their lives at the public expense ; why they are to be put into a more fortunate case than clerks in mer- cantile and banking houses, and than many of our clergy, and of our military and naval officers. p 2 CHAPTER XIII. MILITARY EXPENDITURE. The next head of expenditure, namely, the military part of the service of the Army and Navy, affords the means of retrenchment on a large scale, in consequence of its great amount. In the report of Messrs. Brooksbank and Beltz, on the public accounts, the estimates of the Army, Navy, and Ordnance for 1828 are stated in a manner to shew what part of them was for effective, and what for non- effective expenditure. The following account has been made up from their statements. Effective Expenditure. Non-Effective Expenditure. Army, - - £5,067,793 £2,982,146 Navy, - - 4,576,730 1,557,132 Ordnance, - 1,419,975 365,221 £11,064,498 £4,904,499 MILITARY EXPENDITURE. 213 In addition to these 11 millions of effective expenditure, one more should be set down for army extraordinaries, militia, and other military and naval expenses not included in the estimates ; and, as this has been about the average annual expenditure since 1816, no less than 156 millions have been expended on soldiers, sailors, ships, and artillery, exclusive of the non-effective expenditure, although we have been all the time in a state of profound peace. The only ground on which it is attempted to justify this expenditure, so enormously great in comparison with that of any former peace establishment, is the expediency of being at all times prepared for war. But, during the last thirteen years, there has been less likelihood of war than at any former period, in consequence of the ex- hausted condition of all the powers of Europe, after the last war, and of the tri- umphant display of military and naval force which England was able to make at the conclusion of it. If, in 1816, a peace expenditure had been arranged on a prin- 214 MILITARY EXPENDITURE. ciple of sound economy, having reference only to the real wants of the nation, a very large portion of the 156 millions would have been saved. As the war in Turkey is now terminated, and the affairs of Greece may be said to be settled, the public have good reason to expect that a great reduction in the military and naval expenditure will immediately take place. Although it is right to be prepared for war, it should be borne in mind that several of the most popular and substantial grounds of war have ceased to exist. The barren nature of military trophies, and the substantial advantages of peace, have been fully exhibited in the last forty years. The laws most offensive to foreign trade have been expunged from our statute books ; every country now sees the wisdom of seek- ing commercial prosperity in concurrence with that of its neighbours ; the discovery of the real sources of wealth has shewn the folly of wasting lives and treasure about colonial possessions ; and nothing is now more universally acknowledged than the faL- MILITARY EXPENDITURE. 215 lacy of expecting any national advantage from war. The Committee of Finance, in their Second Report, state it to have been one of the principal objects of their attention to secure (f a strict adjustment of the numbers of the military and naval forces, so as not to exceed what is really necessary for the peace and security of the empire *." They say, " this principle ought not, on any ac- count, to be given up to speculative appre- hensions ;" that, " as the army and navy are the great sources of expense, it is only by keeping them within proper limits that any great saving can be effected ;" and they add, " it is particularly necessary carefully to examine the reasonings and statements of those individuals, who, being qualified from their official stations to give full infor- mation on these subjects, are liable to be led by professional feelings to recommend a higher standard of preparation for war, than a less biassed view of circumstances might suggest." * Second Report, p. 5. 216 MILITARY EXPENDITURE. Military and Naval officers connected with government have had their own way so much in fixing the amount of the forces to be kept up, that it would be strange if it had not been carried beyond its proper limit. Many motives of a personal and professional kind serve to warp their judgments in form- ing conclusions on the circumstances which ought to determine what that limit is. Every officer has a natural and just pride and feel- ing in the perfection of his own department, and at the same time no great inducement to care much about what it costs ; and therefore it is by no means right to leave it entirely to professional men to decide what the number of the forces should be for our peace establishment. According to every rational consideration of the subject, it is clear that the prepara- tion for defence should always be kept down to the lowest possible, rather than always raised to the highest possible point. At the highest it produces a great share of the evils of war. A moderate preparation strictly pro- portioned to the occasion, and not allowed to MILITARY EXPENDITURE. 217 go beyond it, will save more evil than it risks ; all beyond this infallibly produces more evil than it prevents ; it impoverishes the nation, and renders it more easily injured by a powerful enemy, than if it had been al- lowed to save expense, and gather strength in peace *. Our large and well equipped fleets, and numerous well-dressed troops, give, to be sure, an air of magnificence ; but those who furnish out this show should re- member the claims of the industrious class for a reduction of taxation. Notwithstanding there is now, in conse- quence of the peace of Europe being again established, so strong a case in favour of a great reduction in the military expenditure, if the revenue should keep up, there will be but little chance of its taking place ; for nothing seems to have any influence in attracting public attention to measures of economy, but a positive deficiency of the revenue. While, in 1827, and in the beginning of 1828, the revenue was deficient, the ne- cessity of retrenchment was heard on all t Sec Supp. En. Br. vol. iii. p. 276. 218 MILITARY EXPENDITURE. sides. When, however, the April quarter's account of 1828 shewed that the revenue was rapidly recovering, not a word more was said on the subject. Seeing, therefore, that such is the result of just having revenue, enough to go on with from year to year, and that there is no regard to the conse- quences of postponing the revision of our financial system, it would perhaps, in the end, be for the public good, if the revenue should not only be again deficient, but con- tinue so for some time. The great amount of the non-effective ex- penditure in the Army, Navy, and Ordnance, shews the profusion and the want of due consideration for the public interests, with which every thing in the nature of pensions, half-pay, and retired allowances, has been regulated. Those persons who were the authors of these schemes ought to have known that " liberality exercised at the expense of the public, is but another name for waste and a vice, and that all praise be- stowed upon it is false and hypocritical." In order to protect the public, for the fu- MILITARY EXPENDITURE. 219 ture, from this system of making provision out of the public purse for so many thou- sand persons, who, while in active service, receive full remuneration for their time and trouble, it may be well to consider whether any individual, not now in public service, who shall be employed in any civil or mili- tary capacity, should be allowed to receive any pension, half-pay, or superannuation allowance, except in special cases, and un- der the responsibility of government*. Army Expenditure. — It .appears from pa- pers laid before the Committee of Finance, that in 1792 the number of all ranks in the * The following account shews to what an extent the principle has been carried of providing for the poorer part of the upper orders out of the public purse. Per Annum. Military Pensioners, Half-pay, &c. - £4,900,000 Pensions - 772,702|- Superannuation allowance - - - 480,000;j: £0,152,702 •(•Paper, Com. Fin. 234. % Report, Com. Fin., Appendix, No. 13. 220 MILITARY EXPENDITURE. Army was 57,251, and that they were distri- buted as follows : — ■ Great Britain - Officers and Men. 17,007 Ireland - - 11,901 East Indies - 10,700 Canada, Nova Scotia, and Bermuda - 6,061 Gibraltar - 4,221 West-India Islands 6,886 New South Wales 475 57,251 In 1828 the number of all ranks was 116,738, who were distributed as follows : — Great Britain - - - 29,616 Ireland ... 23,969 Colonies - - - 37,037 East Indies - - - 26,116 116,738* The chief part of the increase is accounted for as follows : — Increase in the New Colonies Rank and File. - 17,112 in the Old Colonies 849 in Great Britain 9,096 in Ireland 10,363 in the East Indies - 14,287 51,707 Pap. Com. Fin. No. 79. MILITARY EXPENDITURE. 221 The following statement was laid before the Committee of Finance by the Secretary at War, to explain what number of troops are necessary for our foreign posses- sions : — Rank and File. " There are in the Colonies (exclusive of j India, and supposing the troops to have I evacuated Portugal,) 52 battalions, each j ' at 516 rank and file, that make - -J There are in the East Indies - - 22,560 Making together 49,392 " One-tenth of this force would have to go out every year, (supposing a regiment to be abroad ten years, and to remain at home four years,) that is, 4939 rank and file. There ought to be at home four times 4939, that is 19,756 ; and there ought to be, be- sides, a depot (say) of 120 men for each re- giment of the 52 battalions abroad, (52 x 120) making 6240 men*." According to this statement, the total force necessary to be maintained for our foreign possessions is 75,388 rank and file, viz. * Evidence of Lord Palmerston. 222 MILITARY EXPENDITURE. * Rank and File. Number abroad - - - 49,392 Reliefs at home ^ - 19,756 Depots at home - - - 6,240 75,388: ; - It appears, from the evidence given be- fore the Committee of Finance, by the Duke of Wellington and other military witnesses, that it is necessary to maintain, in addition to this force of 75,388 rank and file, the Foot- Guards, amounting to 5104, and the Cavalry, now in the United Kingdom, amounting to 6129; making, in the whole, a force of 86,621 rank and file. Of this number there would always be in the United Kingdom — Rank and File, 1. The reliefs and depots, amounting to - 25,996 2. The Foot-Guards - - - 5,104 3. The Cavalry now at home - - 6,929 Making the total at home 38,029 But, as 38,000 men for the United King- dom is a larger force by 9000 than that which was. kept up in the peace preceding the war of 1793, it would appear to be a force even more than sufficient, because all the MILITARY EXPENDITURE. 2*23 circumstances of the present time are much more on the side of continued internal peace, than those of the period now referred to. — At that time a formidable conspiracy existed in Ireland for effecting a separation from England by the aid of France ; and Eng- land and Scotland were disturbed by the numbers and violence of public meetings. According to this view of the question of what number the Army should consist, as 87,000 men will provide all the troops requisite for our foreign possessions, and will allow of the Foot-Guards and Cavalry being kept as they now are, and will furnish an army of 38,000 men for Great Britain and Ireland, this force of 87,000 men ought to be considered as quite large enough for all the public services ; but the number voted in 1829 was 102,267, and therefore 15,000 men might to be reduced. Navy Expenditure. — The following sums were voted in 1829. £. For 30,000 Seamen's wages ... 1,014,001 Ditto ditto victuals - - - 643,500 224 MILITARY EXPENDITURE. £. Artificers and Labourers in the Dock-yard 480,000 Timber, and other materials - - - 880,000 It appears from the Report of the Com- mittee of Finance of 1817, that in 1792 it was considered likely that the number of seamen might be reduced to 16,000 ; and the examination of Sir George Cockburn by the last Committee shews that they con- sidered this fact of so much importance as to induce them to require him to go into a very minute explanation to account for keep- ing up more seamen at the present time. As the justification made by Sir George Cockburn rested on the state of affairs in Greece and Turkey, and on the piracy then going on in Greece and in the West Indies, the public have now a right to expect a very large reduction in the number of seamen, and generally in the Navy expenditure, under the new posture of public affairs. If the expenditure in the Navy since the war, had been regulated with reference to the naval forces of other countries, it could never have amounted to what it has; MILITARY EXPENDITURE. 225 and therefore, many millions of money have been wholly thrown away : our efforts to increase our naval power could not have been greater, had other nations continued to keep up as large fleets as they did in former times. According to the evidence of Sir George Cockburn, France had, in 1793, eighty efficient ships of the line, and a large number capable of being made efficient. Now she keeps forty in good order, and has only twenty more*. In 1792, Holland had so large and efficient a fleet, that she was enabled to fight the battle of Camper- down. Sir George Cockburn says, she has now no navy of any importance-)-. In 1793, Spain had seventy-six sail of the line^ ; but her navy was so completely destroyed in the battles of St. Vincent and Trafalgar, and on other occasions during the war, that ac- cording to Sir George Cockburn's evidence, she has a very small one now. On the other hand, Russia and the United States have * p. 12. + Ibid. ♦ James's History, vol. i. p. 80. Q 226 MILITARY EXPENDITURE. more ships than they had in 1792 ; but the increase of their ships makes good but very little of the loss sustained by France, Spain, and Holland, in a comparison between the fleet of England and the fleets of all the rest of the world. In alluding to the great success of the British Navy in diminishing the naval power of other nations, Sir T. B. Martin stated, in his evidence before the Committee of Finance, " the glorious fact, that England seemed to have swept from the face of the ocean the fleets of her enemies, by the capture or destruction of 156 sail of the line, 382 large frigates, 662 corvettes, with other vessels, making, in all, 2506 sail of vessels of war*." Notwithstanding, however, this fact, no less than 63,000,000/. have been granted by Parliament since 1815, for the effective Naval service, just as if the whole of these 2506 sail of vessels had never been taken or destroyed, and were all ready to be employed against us. * Evidence, p. 20. MILITARY EXPENDITURE. "227 But this is not all: for, after having spent so many millions, it would appear by the sums voted in 1829 for artificers, timber, &c, that the time for reducing the Navy Expenditure is not even yet arrived. Sir T. B. Martin says, " respecting the force now employed, it may be said, if contrasted with former periods of peace, that we have a fleet in commission approaching more to a war than a peace establishment*." Ordnance Expenditure. — The Committee of Finance, in their Second Report, ob^ serve, that in the estimates there are no less than 92 stations kept up in the Ordnance service ; namely, 46 in Great Britain, 17 in Ireland, and 35 abroad ; and they say that this number appears very great. They sug- gest that a strict examination should be made into the necessity of keeping up so many. The Committee state the numbers and expense of the Ordnance military corps as follows : — * p. 19. q2 228 MILITARY EXPENDITURE. In 1792, 4846 Officers and Men, £151,606 expense. 1828, 8682 ditto 471,543 ditto. The Committee say, that, in referring to the year 1792 as a year with which to com- pare the expense of the Ordnance military corps in 1828, they have followed the ex- ample of the Select Committee of 1817, who particularly called the attention of the House to the low establishments of that year, by stating, " That as near an ap- proximation to that low scale of establish- ment and expense, as might be formed con- sistent with our more extended possessions, would be highly advantageous in relieving the burdens, and supporting the credit of the country *." The Committee proceed to say, they have examined into the cause of the in- crease of the numbers and expense of the military corps ; but that their inquiries were attended with the difficulty of having to rely on the evidence of those persons who, being qualified by official stations to give informa- * Second Rep. Com. Fin. p. 66. MILITARY EXPENDITURE. 229 tion, are liable to be influenced by profes- sional feelings. They further say, that when they see the sum required is no less than 471,543/., it may be a matter of doubt whe- ther this corps be not on a larger scale than is necessary to secure the keeping up a suf- ficient extent of military knowledge, or con- sistent with a fit and prudent degree of pre- paration for war when the country is in a state of peace. This report of the Committee contains the following important general observation on our military expenditure: — " Towards the conclusion of the late war, circumstances obliged this country to have a larger army in the field, and to maintain establishments much beyond what can, on any reasonable calculation, be requisite on a future occa- sion. The Committee, therefore, are of opinion, that the establishments of the coun- try should be regulated^ not with reference to the unusual circumstances of that war, or to the probability of being again called upon to make a similar exertion, but rather with 230 MILITARY EXPENDITURE. reference to the policy of depending mainly on our navy for protection against foreign invasion^ and for the means of attacking our enemies*." * p. 20. CHAPTER XIV. SLAVE TRADE.— DIVIDENDS.— SINKING FUND. The Slave Trade. — The great sum of five millions seven hundred thousand pounds has already been expended in carrying into ef- fect the measures of government for co-ope- rating with other countries in putting down the slave trade ; and the annual current ex- pense amounts to near 400,000/. * But the attempt appears to have altogether failed. The governments of France, Spain, and Portugal, according to the Parliamentary Papers, make no efforts whatever to enforce the laws for putting down the traffic, and the persons in authority in Cuba and Brazil not only neglect to execute the laws, but, in some cases, have been engaged in it themselves. So that our treaties and laws, * Pap. Gum. Fin. No. 176. 232 DIVIDENDS. where such parties are concerned, are so much waste paper ; and spending money to try to give effect to them is a perfect folly. The African Institution say, in their twen- tieth Report, " The slave trade has increased during the last year ; and, notwithstanding the number of prizes taken, it continues to rage with unabated fury." Surely here are sufficient reasons for saving the 400,000/. a year, now expended to so little purpose. Four per Cent. Stock. — Should the in- terest of money fall to Three percent., there will be an opportunity of making a saving of about 1,500,000/. a year, by paying off the Four per cent. Stock, which amounts to about 165,000,000/. The Sinking Fund. — Our present arrange- ment of the Revenue and Expenditure, by which a revenue of 58,700,000/. is requisite for the public service, is formed on the plan of having a surplus of 3,000,000/. a year, to be applied in redeeming debt ; so that if the Sinking Fund were abandoned, three mil- lions of taxes might be repealed. It is so obvious, from what has been said in these SINKING FUND. 233 pages respecting the injurious effects of some of the taxes, that the public cannot possibly derive any kind of advantage from reducing 800,000,000/. of debt at the rate of 3,000,000/. a year, which can be set against the certain good that will follow from reducing taxes to the amount of 3,000,000/., and that there should be no hesitation about suspending the Sinking Fund* till funds could be got for it, without doing so much injury to industry. CHAPTER XV. COLONIES. There is no part of the public expenditure which more admits of reformation than that which is incurred upon the Colonies ; and if the business were undertaken on proper principles, it ought not to be attended with any very great difficulty. No Parliamentary documents shew what the whole expense is that is paid by English taxes, on account of the Colonies. It is generally estimated that from two to three millions are paid for the Army, Navy, and various Civil charges ; but, in addition to this, the public pay full two millions more for sugar and timber than they ought to pay, in consequence of the increased prices occasioned by the protec- tion given to the colonists by the higher duties imposed on these articles, when im- ported from foreign countries. COLONIES. 235 A Letter from the Treasury to the Secre- tary of State for the Colonies, dated the 24th March,, 1827, fully explains the want of order, economy, and control, which has existed with regard to this important branch of administration*. This Letter states, that the collective expenditure of five of our Colonies has exceeded, on an account of ten and more years, the colonial revenues applicable to the discharge of it, so as to have constituted a deficiency of 2,524,000/. ; that of this sum, 2,425,000/. has been paid, partly by bills on the Treasury, by advances to the Agents of the Colonies, and by the discharge of debts to the East India Com- pany ; that the greater part of this expendi- ture has been incurred without any previous communication with the Treasury ; and that the Treasury has been uninformed, not only of the measures, which, from time to time, have led to extraordinary expenses in these Colonies, but even of the state of the ordi- nary revenues, and of the permanent charges upon them. The Letter further states the * Papers Com. Fin. 236 COLONIES. great inconvenience to which such an imper- fect administration of so important a branch of the public expenditure is obviously liable, and the decided opinion of the Treasury, that some alteration is urgently required in the system on which the financial arrange- ments of the Colonies have hitherto been conducted. If anything were wanting to confirm the accuracy of the statements which have al- ready been made as to the profusion, neglect, and mismanagement, with which the public money has been wasted, this Treasury Letter most completely supplies it. This Letter places, beyond all doubt, the fact, that our expenditure has reached its present amount, not by providing for what the necessity of the public service has required, but by sheer extravagance, arising from allowing the different departments to have their own way in spending whatever money they pleased. When we see one department giving a lecture of this kind to another, and making public how matters have been going on COLONIES. 237 among them, the inference arising from the argument of the probability that great re- trenchment is practicable, is converted into a certain conclusion. The past extravagance of our expenditure in the colonies, and the prospect there is of making them contribute towards their own defence, render it highly probable, that if a wise system of management were introduced, a considerable reduction in the charge on the public purse would be the consequence. With respect to financial arrangements, the control of the Treasury over the Colonial Department should be insisted upon, and fully established. Accounts should be laid before the Treasury, at least quarterly, of the revenue and expenditure of each foreign possession. A Colonial budget should be stated to the House of Commons every session by the Chancellor of the Exchequer, and all Colonial expenses should be voted on a distinct estimate. The official estab- lishments in the colonies should be revised, and reduced to what is merely necessary ; excessive salaries should be diminished, and 238 COLONIES. none but efficient officers should be appoint- ed. All restrictions on colonial trade should be taken off, and then each colony should be made to contribute to the expense of its defence. With regard to the commerce of the colo- nies, all that is wanting is, to give effect to the principle on which the colonial laws of 1822 and 1825 were enacted. The speeches with which these laws were introduced to Parliament by Lord Goderich and Mr. Hus- kisson established the policy of a free trade, and of putting an end to the old colonial monopoly ; and this principle the British legislature adopted in the most complete manner, as the future principle of colonial trade, by unanimously passing these laws. But the trial that has been made of them shews that, in point of fact, they have had no kind of effect in making the trade of the colonies more free than it was before. The truth is, that the principle of free trade on which they were founded has been com- pletely inoperative in consequence of the clauses imposing duties on foreign goods, COLONIES. 239 attached by Mr. Huskisson to the act of 1825, for giving effect to the proviso in his speech, " that the importation of foreign goods into the colonies should be made sub- ject to such moderate duties as may be found sufficient for the fair protection of British productions of a like nature." These duties are so high, that England still practically enjoys all the advantages of the old mono- poly with respect to supplying the colonies with her productions. The failure, there- fore, which was foretold, in 1825, of the attempt to establish a free colonial trade, and at the same time give protection to British manufactures, has come to pass ; and it is now clear that these two things are quite incompatible, and that there is only a choice betwen two alternatives, a choice between absolute freedom, and absolute prohibition. What ought now to be done, in order to promote, in a certain and effectual manner, the interests both of the Colonies and the British public, is, to amend the law of 1825, so as to make it, by repealing all the restric- 240 COLONIES. tions of the old system which that law continued, what it was intended by the legislature to be, namely, a law to give a perfect freedom of trade to the Colonies, and thus get rid, in toto, of the colonial monopoly. The principal restriction arises from the duties just now referred to on foreign goods ; these should be reduced, so as no longer to be for the purpose of giving pro- tection to British manufactures, but only for obtaining revenue. As the Colonies form so small a portion of the market for British goods, the admission of foreign com- petition in them would scarcely be perceived at home. It would, therefore, be a ground- less exaggeration to say, that the British manufacturer would sustain great injury from the removal of all restrictions on the intercourse of the Colonies with foreigners. In the states of North and South Ame- rica, where trade is free with all nations, the great mass of imports are received from Great Britain, because the British goods are cheaper than others; and the same reason would operate in securing to the COLONIES. 241 British manufacturers the principal supply of the Colonies when all protection was removed. By the existing law of navigation, a foreign ship is prevented from importing into the Colonies any goods, except they are the produce of the country to which the ship belongs. This cannot fail to operate as an injurious restriction, and it ought, therefore, to be repealed. The idea of such a regulation being of any advantage to the British navy is absurd. By repealing it, the Colonies would be placed on the same footing as the East India Company's terri- tories. Lord Goderich said, in proposing the Act of 1822 to the House of Commons, " If we look to the dominions of England in the Eastern hemisphere, we shall find the restrictive system has been entirely and systematically abandoned. The whole of the East India Company's territories have never been shackled with the peculiar re- strictions of the navigation laws ; and who will say," said his Lordship, " that the interests of commerce or of navigation have u 242 COLONIES. suffered ? or rather, who will deny that they have been materially benefited by the free- dom they have enjoyed*?" Mr. Marryat, speaking on the same occasion, said, " ships under any flag upon the face of the globe had free access to the ports of our East Indian territories, to bring commodities of every description, and to take away theirs in return. They could buy everything where they could buy cheapest, and sell everything where they could sell dearest f." The restrictions imposed by the Act of 1825 on the importation into the Colonies of beef, pork, fish, coffee, cocoa-nuts, sugar, molasses, and rum, should betaken off, and also the duties imposed by the same Act on the importation of corn s flour, peas, beans, rice, lumber, horses, mules, and cattle. As the incomes of the owners of estates in the Colonies are derived from profits on their capital, and not from rent, it is essen- tially necessary that the prices of the articles requisite for feeding the slaves, and all * Parliamentary Debates, vol. vi. p. 1416. ♦ lb. vol. vii. p. 604. COLONIES. 243 other articles which are of the nature of materials for growing and manufacturing sugar, rum, &c. should be kept down, so that the cost of production may be as low as possible. All these restrictions and duties on food, clothing, lumber, &c, are positive taxes on labour, and cannot be justified by reference to the interests of Irish, Scotch, or Canadian land-owners. If the planters of our Colonies are ever to carry on a successful competition with foreigners in supplying foreign countries with sugar, it is absolutely necessary that these restrictions on food, lumber. &c. should be done away, or that they should be countervailed by continuing to tax the people of England to pay a bounty on ex- porting sugar. Our present system is the height of absurdity ; first to raise the cost of producing sugar by taxing labour in the Colonies, and then to countervail the con- sequences of it, by taxing the people of England to pay a bounty on sugar. As these duties on corn and lumber were the cause of the alien duty which the United it 2 244 COLONIES. States imposed on British ships trading between America and the Colonies, this is an additional and a most cogent reason for repealing them. The duty of 8/. Ss. a cvvt. on refined sugar, imported into England, operates as a prohibition of refining in the Colonies for the supply of the British market ; and the bounty on refined sugar, exported from the United Kingdom, prevents any refining in the Colonies for foreign markets. If these impediments were removed, the busi- ness of refining sugar in the Colonies might be carried on to great advantage. Sugar could be refined there at one-third of the expense it costs in England ; and this cir- cumstance,, together with the saving of the increased expense of freight for carrying raw sugar, would admit of the price of re- fined sugar being reduced, so as to increase the consumption of it in England, and to secure it a market abroad. Mr. Bryan Edwards says, that the great progress which was formerly made in the improvement of the French Colonies was chiefly owing to COLONIES. 245 their being allowed to carry on the business of refining sugar. In order to extend the market for all the different productions of the Colonies, and at the same time do what would be extremely beneficial to the public at large, particularly to the manufacturing and shipping interests, every article of the growth, produce, or manufacture of the Colonies should be ad- mitted into the United Kingdom free of duty, except sugar, rum, and coffee. As a number of these productions are articles of raw materials of manufactures and trades, such a measure would be of the greatest advantage to them. If all these measures were adopted which have just been suggested, then the principle of the law of 1825 would have full opera- tion. There would be no obstruction in the way of the colonists turning their skill, in- dustry, and capital to the best advantage in any manner they pleased. Instead of con- tinually looking to Government and Parlia- ment for relief from their distresses, they would find out either how to realize a fair 246 COLONIES. profit in their present pursuits, or to with- draw their capital, and place it where it could be turned to a better account. But the benefit of these measures would not be confined to the colonists ; it would extend itself in various ways to the public at large. In the first place, as the granting of a really free trade to the Colonies would be an abandonment of that part of the old colonial monopoly which secured to England the supplying of the Colonies with her productions, the grounds would be laid for taking away from the Colonies the mo- nopoly which they have of supplying the United Kingdom with sugar, and other pro- ductions. So long as England forces the Colonies to resort to her for what they have to buy, they are entitled to demand that they should be allowed exclusively to supply England with colonial products ; but when we shall relieve them from all vexatious re- straints, and allow them to resort to all the markets of the world, they will have no longer any claim to the monopoly of the British market. When the merchants and COLONIES. 247 manufacturers of England are deprived of the monopoly of the Colony market, we are bound, in justice to the public, to deprive the colonists of the monopoly of the British market. It has always been admitted by the ablest defenders of the monopoly system, that one part of it could not be supported independently of the rest ; that the two branches of the monopoly must stand or fall together. Lord Sheffield says, " the British dominions are as much entitled to the mono- poly of the markets of the British West Indies, as the latter are entitled to those of the former ; and whenever that monopoly is given up, it will be the highest absurdity not to open all the British ports to foreign raw sugar*." Another most important benefit that the public at large may derive from a really free colonial trade, is the payment by the Colo- nies of the expense incurred in support- ing armies aud fleets to defend them. One of the witnesses examined before the Com- mittee of Finance, whose public situation * Edinburgh Review, vol. xlii. p. 301. 248 COLONIES. made his evidence of the highest authority on this point, said, that " attempts have been made in all the West India islands to induce them to contribute to the expenses of the establishments ; and they have always represented that their means of doing so were crippled by the commercial arrange- ments of the mother country : they have said, * if you will let us trade as w r e like, and collect our own custom duties, and so on, we will do it*.' " This willingness to contribute towards the defence of the Colonies on these conditions is declared by all who are interested in them. The means, therefore, of effecting a very great retrenchment in our present ex- penditure is entirely in the hands of the * Evidence of Lord Palmer stem, p. 146. The member of a city, the third in rank for its trade with the Colonies, expressed himself on this subject as follows, in the last session. " Let the trade on the part of foreign countries with the West India islands be opened upon pay- ment of five per cent, duty on all articles imported there, and then, and not till then, would he consent to a reduction of the protecting duties on East India and foreign sugars." (May 25, 1829.— Mr. Bright.) COLONIES. 249 legislature, at no greater trouble than that of now doing what it was the declared intention of the law of 1825 to do, namely, esta- blish, sincerely and thoroughly, a free colo- nial trade. Another great benefit, that will be gained by wholly getting rid of the old monopoly system, will be the removing of all difficul- ties in the way of forming a correct opinion upon what are the advantages of Colo- nies. The prevailing opinion, that large profits are obtained through the monopoly, has always confused the question. This opinion has been held to be so completely beyond all doubt, that the great value of Colonies has been considered as not admit- ting of dispute ; and no pains have been taken to trace by facts in what way they are valuable. Had such an examination been properly gone into, it would have shewn that neither the British public nor the Colonies have ever been benefited by the monopoly ; and it would also have shewn that the possession of the Colonies affords no ad- vantages which could not be obtained by 250 COLONIES. commercial intercourse with independent states. There are only three ways that the colo- nies can be of any advantage, 1. In fur- nishing a military force ; 2. In supplying the parent state with a revenue ; 3. In afford- ing commercial advantages. 1. Instead of furnishing a military force, the Colonies are always a great drain upon the military resources of the country, par- ticularly in war, when they occupy a large portion of the army and fleet in their defence. In the last war, while our own shores were threatened with invasion from Boulogne and Brest, our means of defence were greatly crippled by the number of troops and ships we were obliged to keep in the colonies. 2. With respect to revenue, we have de- clared by the Act of the 18 Geo. III., that we will not levy any taxes or duties in the colonies except for their use. 3. As to commercial advantages, if the colonial trade were quite free, our commer- cial relations with the colonies would resem- ble the intercourse between ourselves and COLONIES. 251 independent countries ; and therefore what- ever advantages we shall derive from them will be embraced in two questions — 1st, Whether our commerce with them will be more beneficial than with independent coun- tries ? 2nd. Whether the capital employed in them will be more beneficially employed than it would be, if employed in the United Kingdom ? With respect to the first question, it is one easily solved, because, where the em- ployment of capital is free, the net profit that may be obtained by the employment of it in commerce with independent countries, will always be as great as if it were employed in the colonial trade. The trade we carry on with the United States proves this. With respect to the second question, it is necessary to trace the operations of capital when employed in the Colonies, and when employed at home. In the West India islands it goes to feed and clothe slaves ; to pay British agents, clerks, and managers ; to employ ships and sailors ; and although the gross profit upon it seems very high 252 COLONIES. when all the charges and risks are consi- dered, and also the effects of competition, the net profit cannot be greater than it is on capital employed at home. When capital is employed in the United Kingdom — for instance, on manufactures — it pays wages to English workmen instead of buying clothes and food for slaves ; it employs agents, clerks, and managers ; it employs ships and sailors to import raw ma- terials, and to export the finished goods, and the rate of net profit on it is full as high as that on capital employed in the Colonies. The incomes derived by West India pro- prietors from their profits are spent like incomes derived from rent, and add nothing to the national wealth ; but the profits made on capital employed at home are added to capital, and thus promote the constant accu- mulation of it. It is clear, therefore, that, on the whole, the public derives no commer- cial advantage from the colonies, which it might not have without them. They do not even afford any advantage, as some persons suppose, by enlarging the field COLONIES. 253 for the employment of capital ; for there are still means enough for employing capital with profit at home ; and if new means were wanting, they would be more effectually ob- tained by removing restrictions on trade and revising the taxes, than by increased trade in the colonies. This general reasoning, which the princi- ples of trade suggest, in refutation of the imaginary advantages of colonies, is com- pletely borne out by the experience of facts. The history of the colonies for many years is that of a series of loss, and of the destruction of capital ; and if to the many millions of pri- vate capital, which have been thus wasted, were added some hundred millions that have been raised by British taxes, and spent on account of the colonies, the total loss to the British public of wealth, which the colonies have occasioned, would appear to be quite enormous. The only conditions on which it can be wise and politic for us to continue to keep colonial possessions are, that the number of them should be greatly reduced ; and that 254 COLONIES. those which we retain should contribute the whole expense incurred in their defence. Even with such conditions, no advantage would be gained, now or at any other time, unless the planters should prosper and accu- mulate wealth, and thus add to the general stock of public wealth. It is in order to secure this object that the public is particu- larly interested in giving to the colonies the full benefit of that perfect system of free trade, which everything connected with colo- nial reform and retrenchment shews to be wise and politic. Dr. Chalmers, in referring to the peace of 1763, says, " The true objection to this peace was, not that we had retained too little, but that we had retained too much ;" namely, Canada, Louisiana, Florida, Gra- nada, Tobago, St. Vincent, Dominica, and Senegal. "Millions," he adds, "of produc- tive capital were withdrawn from the agri- culture, manufactures, and trade of Great Britain to cultivate the ceded islands in the other hemisphere : domestic occupations were obstructed and circulation stopped, in COLONIES. 255 proportion to the stock withdrawn, to the industry enfeebled, and to the ardour turned to less salutary objects *." In settling the conditions of the last treaty of peace, it was most unwise to retain so many of the conquered colonies. Trinidad, Demerara, Essequibo, and Tobago, were but little advanced in cultivation ; a large trans- fer of capital was necessary for their cul- tivation, and there was little or no local revenue belonging to them. At the close of the war, the East India Company was anxious to be allowed to have the Island of Ceylon, and it is not too late to give it up to them ; but, as large sums of public money have been expended since the war in adding to its value, the Company should repay a large part of them, as the condition of becoming masters of this island. As the Cape of Good Hope and the Mau- ritius are of no use except for the defence of the East India Company's possessions, the Company ought to be called on to defray * Estimate, pp. 142, 143. 256 COLONIES. all the expense of their military protection ; and it is to be hoped that the opportunity, which the expiration of the Charter of the Company will offer, will lead to an arrangement which will secure all these ob- jects. When peace was made in 1814, the Eng- lish government wished to let Austria have the Ionian Islands, but France would not agree to this arrangement. There can be no real use in keeping these islands, with Malta and Gibraltar in our hands. The settlement of Sierra Leone and the military posts on the west coast of Africa should be given up. The public derives no benefit from these possessions, either in a commercial or military point of view; and with respect to the slave trade, the use they are of in» contributing to put it down is so questionable, as not to justify the waste of money, and of human life, which they occasion. With respect to Canada, (including our other possessions on the continent of North America,) no case can be made out to shew COLONIES. 257 that we should not have every commercial advantage we are supposed now to have, if it were made an independent state. Neither our manufactures, foreign commerce, nor shipping, would be injured by such a mea- sure. On the other hand, what has the na- tion lost by Canada ? Fifty or sixty millions have already been expended ; the annual charge on the British treasury is full 600,000/. a year ; and we learn from the Second Re- port of the Committee of Finance, that a plan of fortifying Canada has been for two or three years in progress, which is to cost 3,000,000/. CHAPTER XVI. IRELAND. Ireland, hitherto so heavy a burden on Eng- land, may now be considered as a source of great financial support. Industry, and the accumulation of wealth, must have been greatly obstructed by the continued agitation of all parts of that country. Mr. Malthus remarks, with great force, and in terms which render his observation peculiarly ap- plicable to Ireland, that "among the primary and most important causes, which influence the wealth of nations, must be placed those which come under the head of politics and morals. Security of property, without a cer- tain degree of which there will be no en- couragement to individual industry, depends mainly upon the political constitution of a country, the excellence of its laws, and the manner in which they are administered; and IRELAND. 259 those habits which are the most favourable to regular exertions, as well as to the general rectitude of character, and are consequently most favourable to the production and main- tenance of wealth, depend chiefly upon the same causes, combined with moral and reli- gious instruction*." Now the law, which deprived several millions of Catholics in Ireland of their civil rights, established that hostility to laws of all kinds, which occa- sioned general discontent, and that series of outrages and insurrections, which kept the whole country in a state of constant alarm and agitation. It placed society under such circumstances as did not admit of the exist- ence of security of property in that complete degree which is essentially indispensable, in order that industry and capital should have their proper effects in bringing into use the natural resources of the country, and augmenting its annual productions ; under such circumstances as did not admit of the forming of those habits among the people * Principles of Political Economy, p. 344. S 260 IRELAND. which are the most favourable to regular exertions and general rectitude of character, and consequently most favourable to the prosecution and maintenance of wealth. Ireland is not now a poor country, and her people unemployed, because she has not had opportunities of being a rich and indus- trious country, but because her habits have been such, that these opportunities have been thrown away. During thirteen years, from 1803 to 1816, the demand for all her productions was so great, and the prices of them so high with reference to the cost of production, that had it not been for the de- fects in her political and moral condition, she must have become a very rich and flou- rishing country. Had she possessed the same free and tolerant laws, and the same habits, as England, Scotland, Holland, Switzerland, and the United States, an im- mense accumulation of wealth would have been secured before the fall of prices which took place subsequent to 1816. Now, however, that the main evil is re- moved, security of property will be esta- IRELAND. 261 blished, by every sect being free from all restraint, and interested in coming for- ward to promote the due administration of the laws ; this will draw forth the ca- pital, which, under all disadvantages, exists in Ireland to a very considerable amount, and lead to a rapid progress being made in adding to it, — as the markets of England are open to all Irish productions, while the cost of production is low, the rate of profit in Ireland is high, and therefore ac- cumulation, with improved habits, will be very rapid. All the commercial restrictions and vexa- tious Custom- House regulations that fettered the intercourse between Ireland and England having been removed a few years ago, the foundations are established for rendering the settling of the Catholic Question as com- pletely successful in promoting the pros- perity of Ireland, as the most zealous advo- cates of it have ever anticipated *. * In the year 1821 a motion was made in the House of Commons by the Author for a Committee to inquire into the commercial intercourse between Great Britain and 262 IRELAND. The net revenue now paid by Ireland is, with reference to her population, at the rate of about 9s. a head ; whereas, that paid in Great Britain is at the rate of 70s. a head. If, then, the future improvement of Ireland shall so far increase its wealth as only to make the revenue amount to 18s. a head, England will receive 3,800,000/. a year more from Ireland than she now receives *. Ireland, with a view to carrying the following measures : 1. The repeal of the Union-protecting duties. 2. The repeal of the countervailing duties. 3. The placing the trade on the footing of a coasting trade. 4. The reduction of port charges. 5. The assimilation of the currency of Ireland to that of Great Britain. All these measures have since been adopted, pursuant to the Reports of the Commissioners of Irish Revenue Inquiry. * The Net Revenue of Ireland in 1828 was 3,728,000/. CHAPTER XVII. SUMMARY OF RETRENCHMENT. Having now gone through the principal heads of the public expenditure, it remains only to make a summary of the reductions which have been suggested with reference to the expenditure of 1827, amounting, with the Sinking Fund, to 58,744,863/. *. As the only object of this publication is to shew the expediency of reducing certain taxes, and the practicability of making re^ trenchment, the manner and time of carry- ing these measures into operation is left for others to settle. It is by no means intended or expected that all that has been proposed, under the conviction of the benefit which would be conferred on the public, should or could be immediately adopted. What is stated, therefore, as practicable in the way of retrenchment, is not to be taken as pro- * See Supra, p. 103. 264 SUMMARY OF RETRENCHMENT. posing a plan for carrying into effect any hasty or crude reform, but merely as the re- sult of a careful consideration of all the facts of the case. The following are the reductions of ex- pense which have been suggested in the preceding pages. Linen Bounties, 200,000/. Bounties on Fisheries, 90,000/. Bounty on Sugar, 100,000/. Management of Debt, 270,000/. Lord Lieutenant of Ireland, 100,000/. Irish Miscellaneous Services, 100,000/. Slave Trade, 350,000/. The reduction of the amount of these items might be made without any real dif- ficulty. Under the collection of revenue, the greater part of the sum of 700,000/. a year, which is expended in attempting to suppress smug- gling, would be saved by the proposed reduction of taxes ; and other expenses might be considerably reduced. What might be saved under the heads of the Management of the Expenditure and Civil Government, would amount to some hundred thousand pounds, if all salaries SUMMARY OF RETRENCHMENT. 265 were reduced, and the mode of conducting business revised and reformed. With respect to the military and naval expenditure, now that peace is restored to Europe, it ought, at least, to be reduced to the amount of two millions. If one million a year of the Sinking Fund were applied in converting perpetual annui- ties into annuities for ninety-nine years, a considerable redemption of debt would be secured, and two millions might be reduced. Should the 3 per cent, stock rise to par, the reduction of the dividends on the 4 and 3^ per cent, stocks should be a matter of course. And if the measures proposed for reform- ing our colonial system were adopted, it may reasonably be expected that one-third of the present expense might be saved. CHAPTER XVIII. NEW TAXES. Although nothing has been set down in the foregoing statement, for which reasons, of greater or less force, have not been given, as the several reductions could not be brought into operation for some time, it would not be right to depend on them only, for the means of making good the revenue that would be lost by repealing taxes. The proper prin- ciple on which the proposed reduction of tax- ation and expenditure should be conducted, is, that the securing of a sufficiency of re- venue should never be a matter of doubt ; and, therefore, it is particularly desirable that when a measure is taken for reducing taxes, there should, at the same time, not only be some measure to produce a reduction of ex- pense, but also a new tax which shall be of NEW TAXES. 267 such a nature as to make quite certain of receiving from it full as much revenue as will be wanting for all the public services. In selecting a new tax, there seems to be but one opinion with respect to what tax that ought to be. Persons who hold the most opposite doctrines on the subject of our financial, commercial, and agricultural dif- ficulties, in suggesting remedies, have made an Income Tax a part of them. Such a tax, if fixed at about one and a half or two per cent., would probably yield three millions a year ; for though ten per cent, in 1814 yielded not quite 14,000,000/., it is reasonable to assume that the progress of national wealth in the United Kingdom since that year would render a tax of two per cent, as productive as just stated. What has now been said concerning the means of making good the revenue which would be lost by reducing taxes, — 1. by in- creased consumption ; 2. by retrenchment, and 3. by an Income Tax, — makes it clear that it is practicable to carry into effect a great part of the reform of taxation which 268 NEW TAXES. has been proposed. If an Income Tax were imposed, and if, at the same time, government made those retrenchments, which it has the power of making without any diffi- culty, a reduction of some millions of taxes might be attempted in the first year ; and if the business of retrenchment were steadily and vigorously persevered in, a further re- duction of one or two millions of taxes might be effected in each subsequent year, till the whole plan of reform should be carried into execution. If, in addition to this reform of the taxes, all monopolies and protections were abolish- ed, the condition of every class of society with respect to pecuniary impositions for the public service would be greatly improved. There would be less money, to the amount of at least twenty millions a year, paid for taxes and for protecting prices ; all prices would be greatly reduced ; the cost of production would be considerably diminished in manu- factures ; the rate of profit on capital would be raised ; the employment of capital and labour would be greatly extended ; the inte- NEW TAXES. 269 rests of agriculture, manufactures, and fo- reign commerce, would be strengthened and advanced ; the accumulating force of acquir- ing new national wealth would be increased, and if peace should continue, the sources of taxation would be so enlarged, that all finan- cial difficulty would be got rid of; inasmuch as the consequence of increased wealth would be to establish the practicability of carrying on new wars without adding to the debt, and wholly by war taxes. CHAPTER XIX. THE NATIONAL DEBT. The Fourth Report of the Committee of Finance contains the following account of the amount of the Funded Debt : — Capital of Debt unredeemed - £777,476,890 Long Annuities ... 1,331,458 Imperial and Exchequer Annuities 67,718 Life Annuities - - - 617,537 Annuity payable to the Bank - 585,740 * As the great amount of the debt has pro- duced a very general opinion that England cannot embark in new wars without destroy- ing her trade and manufactures, and without so exhausting the resources of taxation as to incur the calamity of national bankruptcy, it is important to make some remarks on the funding system, by which the debt has been created, and to trace its effects * 4th Rep. Com. Fin. 1828. App. No. 17, p. 124. NATIONAL DEBT. 271 on the industry, wealth, and power of the state. It is now, while we are at peace, that it is proper to make those investigations which are necessary to enable us to form correct opinions respecting the injury which the debt has already occasioned ; and respecting the probable injury which will be the result of making additions to it. This opportunity ought not to be neglected for considering these questions, and for digesting and ma- turing those measures which, after a full examination of the financial circumstances of the nation, may appear most fit to be adopted. But before going into this sub- ject, a few remarks will be made to explain what the extent of the evil is which the debt has produced. After the capital of individuals gets into the hands of government in the shape of a loan, it is immediately paid away in pur- chasing stores, provisions, or in providing the instruments and materials of war ; — that is, on perishable commodities. So that, at the end of a year, or at most a few months 272 NATIONAL DEBT. more, " it is turned away from serving in the function of capital to serve in that of revenue, and is spent and wasted without even the hope of any future reproduction*." If the capital, which, from time to time, has been contributed to loans, had not been so applied, it would still be in existence, and it would have been employed in car- rying on some trade, with the ordinary rate of profit ; so that it would, every year, have been augmented. The debt, therefore, has not only diminished the wealth of the na- tion, by the actual amount of the capital sub- scribed to it, but by the amount also of the accumulation of new capital, which would have followed from the lost capital being productively employed. This is the great evil which has arisen from the funding system ; and had it not been for the wonderful energies of the country in accumulating new capital to re- place the immense amount that has been * Wealth of Nations, vol. iv. p. 30. Mr. M'Culloch's edition. NATIONAL DEBT. 273 extinguished, poverty and ruin must have been the result *. The next circumstance to be noticed, as arising from the debt, is the taxation, which becomes indispensable in order to provide the interest payable upon it. The annual charge for the debt is 28,372,142/.f The raising of this sum by taxes has quite a different effect upon the national wealth from that which has been explained to be the effect of loans. In the case of taxes laid on for paying interest, instead of capital being contributed, which is spent and lost, a portion of the revenue or income of one set of persons is taken, and paid over to another set, in the shape of di- vidends. There is, therefore, no positive diminution of the national wealth occasioned by this operation ; and the paying of * The increased exertion and parsimony which were pro- duced by the taxes during the war make it extremely doubt- fid whether the capital of the country would have been ma- terially greater than it is, had the general Iranquillity been maintained from 1793 to the present time. — See Note, Wealth of Nations, vol. ii. p. 120. t 4th Rep. Com. Fin. App. No. 17, p. 125. T 274 NATIONAL DEBT. 28,000,000/. a year in dividends is, in point of fact, a transfer of so much money from the pockets of one part of the public into the pockets of another part of it. And if the taxes for paying the dividends did not fail on the materials of industry, on manufac- tures, and on food, the principal injury they would occasion, would consist in the expense and vexation attending the collecting of them. As a large amount, however, of the existing taxes are of the latter description, the debt is justly considered as a heavy burden on the industry of the country. If the facility with which money may be obtained were the only circumstance to be attended to, there is no question that the borrowing system is the best. But other considerations should not be overlooked. Those who are the advocates of this system seem not to have taken any very comprehen- sive view of its different bearings and inci- dents. They ought, however, to extend their observations to the remote effects of it, and trace its permanent and ultimate influ- ence. Our present situation, in conse- NATIONAL DEBT. 275 quence of the extent to which taxation has been carried, for providing the interest of the debt, ought to remove all doubts con- cerning its destructive character ; for we certainly are less able than we ought to be to resist whatever attacks may be made on our freedom and independence, as well as to in- terfere with decisive effect in defence of the liberties of others*. On the other hand, the public derive some advantage from the debt, for it serves to pro- mote the accumulation of capital by affording, with very little trouble or expense, the oppor- tunity of investing money in stock with the certainty of receiving the interest upon it on a fixed day, and with the power of getting imme- diate possession of the principal whenever it may be wanted ; but a fourth or a fifth part of our debt would be quite large enough for this purpose. Although the immense efforts that have been successfully made in the last forty years to extend industry and increase pro- * See note, Wealth of Nations, vol. iv. p. 561, b T 2 276 NATIONAL DEBT. duction, particularly by the use of machinery, have in a great measure counteracted the evils of the funding system — in the long run, if" the expenses of future wars shall be pro- vided by loans, and if each war shall add some hundred of millions to the debt, and some ten or fifteen millions of permanent taxes to those we now have, no new efforts to extend industry and production will be able to counteract the effects of the kind of taxes which must, under such circumstances, be imposed. There must be a limit somewhere to taxation, beyond which, if it be carried, national decay will follow ; and surely a debt of near 800,000,000/., requiring 28,000,000/. of taxes for interest, must have brought the country a long way in the course of approximating to that limit. CHAPTER XX. FUTURE WAR EXPENDITURE. Seeing what the amount of the debt is, or rather of the taxes for paying the interest on it, and what the consequences will be of new loans, the only conclusion to be come to is, that the security and stability of the British empire depend on so managing the finances of it, that the whole expense of them in future wars may be provided for by war- taxes. In order to accomplish this, the principal measure to be adopted is to reduce the peace establishment ; for if three, four, or more millions were reduced, these would be so many available millions in the possession of the public as resources for war expendi- ture. With respect to the practicability of pro- 278 FUTURE WAR EXPENDITURE. viding for war expenditure, by war taxes, if the reforms with respect to taxation and re- trenchment, which have been proposed, were only in part adopted, the country would certainly be in a state to pay, within the year, all the expenses of a war, conducted with proper economy. The great expense which has been incurred during the peace, upon the Army, Navy, and Ordnance, and the efficient manner in which the money has been applied in placing these services in a high state of preparation for war, should enable us to go to war with- out a very great additional expense. There is now expended about 16,000,000/. annually on the Army, Navy, and Ordnance, of which 11,000,000/. is effective expendi- ture. In looking back to see what was the annual expenditure in the last war, it appears that in 1798, when our fleets and armies were very numerous, and ac- tively employed, the war expenditure was 33,000,000/. If, then, we assume that 30,000,000/. would be the annual ex- penditure in a new war, 19.000,000/. will FUTURE WAR EXPENDITURE. 279 be wanting in addition to the 11,000,000/. now expended. As the Property-Tax, and the half of the Assessed Taxes which have been repealed, yielded a revenue of 18,000,000/., if no more than 19,000,000/. were required in addition to our present expenditure, there ought to be no difficulty in raising it ; for a Property-Tax of ten per cent, should now yield a much larger revenue than it did in 1815, in consequence of the increased wealth of the nation since that time, and of there being no longer any reason why it should not be extended to Ireland. If an Income-Tax of ten per cent, did not produce sufficient revenue for all the war expenditure, it would be much better to make it twelve, or even fifteen per cent., than to raise money by loans, or to re-im- pose the high assessed taxes which were levied last war, for these would interfere much more with trade and industry than a higher rate of Income-Tax. As an Income-Tax would chiefly fall on 280 FUTURE WAR EXPENDITURE. rent, tithes, interest money, and dividends, the large revenue which it would yield from the moment it was imposed, would not be accompanied by any shock to industry ; it would produce no interruption to the usual operations of manufactures and trade ; it would not diminish the amount of capital employed on them, nor of the wages paid to the workmen ; nor would it have any influence in raising the prices of goods ; and consequently, it could have none in diminish- ing the market for them. There is not, in point of fact, any foundation for the opinion which some persons are known to maintain, that the laying on of a large amount of war taxes would produce an enormous derange- ment of industry, and that war taxation would throw the country into more diffi- culty than loans. The heavy war taxes of 1798 produced no such derangement or difficulty. But, in order to carry into effect an at- tempt to avoid the necessity of having re- course to loans in a new war, with any FUTURE WAR EXPENDITURE. 281 chance of success, some preparation is indispensable while we are in a state of peace. In the first place, a moderate in- come tax should be imposed, as has already been suggested, as a foundation to raise, in the first year of war, a full year's produce at an increased per centage ; for, if no preparation be made, when war shall happen everything will be in confusion, and all money matters under great embarrassment. There will be no time for deliberation ; everything will be done in a hurry ; every kind of expedient will be adopted that promises the means of overcoming the diffi- culty of the moment : and as the raising of money by loans will appear to divest the war of its chief privations and hardships, this will be, in all probability, under such circumstances, the course adopted. Another indispensable measure of prepa- ration for conducting the finances during war without loans, is the getting rid of the greater part of the unfunded debt. The amount of Exchequer Bills issued and 282 FUTURE WAR EXPENDITURE. unprovided for on the 11th of February, 1829, was 28,046,000/. *, since which three millions have been funded. The only advantage the public derives from having so much of its debt due on Ex- chequer Bills, consists in the interest on them being lower than the interest would be on the same sum, if converted into stock. The annual saving may be estimated at 300,000/. But against this advantage, the following disadvantages are to be set : — 1. Whenever public or commercial credit receives a shock, Exchequer Bills come to a discount, and payments may be made in them to government for taxes, or other pur- poses, just at the time when the revenue is most likely to be deficient. 2. The existence of a large unfunded debt at the commencement of a war would de- prive the government of the advantage of being able to raise money on Exchequer Bills until the war taxes should become pro- ductive ; or, in case of a loan being unavoid- * Parliamentary Papers, 1829 — No. 11. FUTURE WAR EXPENDITURE. 283 able, it would deprive the government of the only resource by which combinations of loan contractors can be defeated. 3. As the government deal chiefly with the Bank of England in disposing of Exchequer Bills, the capital of the Bank is vested in them to a very large amount, instead of being employed in discounts, and so as to be at the command of the Bank whenever a run takes place for gold. As long as this is the case, the currency is not settled or safe, nor the public free from being exposed to the evil of a renewed suspension of cash payments. For these reasons, therefore, the loss in interest, which would be incurred by funding the greater part of the unfunded debt, would be amply compensated by doing away with these very great disadvantages which are the consequences of it, and which expose the country to suffer much larger losses. What has now been stated with respect to preparing for going to war, shews that, if a proper financial preparation is to be made, as well as preparations of armies and fleets, 284 FUTURE WAR EXPENDITURE. no time should be lost in adopting the following measures : — 1st. Such a revision and reform of taxes, and of commercial regulations, as shall re- move all existing obstructions in the way of extending industry and national wealth ; so that the sources of war taxes may be in- creased as much as possible. 2dly, Such a revision and reform of the public expenditure as shall carry retrench- ment into every part of it, and reduce the peace establishment to the lowest point con- sistent with the public service. 3rdly. The imposing of an income tax of 1± or 2 per cent., in order that one of 10 or 12 per cent, may be brought into full opera- tion the moment a war becomes inevitable. 4thly. The funding of at least two-thirds of the unfunded debt. These are all measures obviously neces- sary, to allow the natural capacity of the nation to meet, in the most effectual manner, whatever difficulties may occur. The adopt- ing of them cannot but be attended with every kind of advantage in peace, as well as FUTURE WAR EXPENDITURE. 285 in war ; and the postponing of them will be nothing short of exposing the British Empire to the most formidable difficulties, and the greatest disasters. The experience of what took place with respect to loans and war-taxes in the last war affords the strongest reasons for in- ducing Parliament to come to a determina- tion to carry the principle of war-taxes to the utmost limit in a new war, sooner than raise money by loans. A Treasury Account that was laid before the Committee of Finance contains the facts on which this policy may be justified *. In this account there is a column, No. 3, which shews what the expenditure was in each year from 1792 to 1816, exclusive of any charge for Sinking Fund on the debt as it existed in 1792 ; and also exclusive of every charge on any debt contracted subsequent to 1792. So that this expenditure is what would have taken place as the expenditure of the war, if, in 1793, the Sinking Fund * See Appendix, No. 4« 286 FUTURE WAR EXPENDITURE. had been discontinued, and if no loans had been made subsequent to 1792. Another column of this account, No. 4, shews the net revenue yielded by taxes that was paid into the Treasury in each year from 1792 to 1816. This account shews, by a comparison of the total expenditure during the wars of 1793 and 1803, (exclusive of interest on loans borrowed subsequently to 1792, and of payments on account of the Sinking Fund,) with the total revenue paid into the Exchequer, that the excess of expenditure was no more than 172,000,000/. although loans to the amount of 509,000,000/. were raised — so that the difference between 172 and 509 millions was expended in paying the interest on the loans raised subsequently to 1792, and in paying the Sinking Fund — both which drains of treasure would have been prevented if war-taxes had been im- posed in 1793. The great sums of revenue, raised by war- taxes during the war, place it almost beyond all doubt, that if an Income-tax of five per FUTURE WAR EXPENDITURE. 287 cent, had been imposed at the commence- ment of it, and if its rate per cent, had been increased, and such other war-taxes laid on as were laid on according as the expenses of the war increased, the whole expenditure of the wars of 1793 and 1803 might have been provided by them, and without having recourse to loans. The average annual war expenses for the first five years of the war was 19,000,000/. When, however, it appears that an income- tax of five per cent, and other war-taxes produced 16,400,000/. in 1799, it is evident that the whole of this excess might have been obtained by war-taxes*. With respect to the war of 1803, it can be made appear by the above account that the revenue actually paid into the Exchequer only fell short by 23,000,000/. of the whole expenditure of 808,500,000/. in that war. The great mistake committed by Mr. Pitt * According to Column No. 4, the revenue in 1799 was 35,600,000/. If from this is deducted 19,200,000/. for the peace expenditure, 16,400,000/. remains as the produce of war-taxes. 288 FUTURE WAR EXPENDITURE. was postponing till 1798 the plan of war- taxes. The paying of the whole expense of the war by this plan had by that time be- come a much more difficult task to accomplish than it was in 1793 ; because, in the interval of five years between 1792 and 1798, 110 millions (of principal) had been borrowed, and taxes to the amount of 5,700,000/. * had been laid on and permanently mortgaged for paying the interest on this new debt t. * Dr. Hamilton, 3d ed. p. 320. t lb. p. 246. CHAPTER XXI. LOANS IN NOMINAL CAPITAL. The loans raised prior to the war of 1793 were obtained for the most part on stock of the same amount as the sums lent, occasion- ally with a small bonus arising from profits of lotteries, or of a small terminable annuity *. But, in 1793, Mr. Pitt introduced two alte- rations in the plan of borrowing : 1st, That of borrowing in a nominal capital. 2dly, That of receiving biddings for the loans from loan-contractors. Since that time nearly all loans have been made in 3 per cent, stock. These changes have prevented the public from taking advantage of the fall of interest on money. If it was the duty of a finance minister to * Dr. Hamilton, see Tables III. V.— Appendix. U 290 LOANS IN NOMINAL CAPITAL. raise loans at the lowest possible interest for which money could be procured, he would be right in borrowing in a 3 per cent, stock, or even in one of a lower price. But other circumstances of serious importance should be attended to ; for experience has fully established the fact, that whatever may, on the one hand, be gained by a low rate of interest at the time of making a loan, will, on the other, fall very far short of compen- sating the public for the loss which will af- terwards follow. It is now evident, that whatever gain there was from savings of interest during the war, was but very small in comparison with what the loss has been by not being able to take advantage of the fall in the interest of money since the peace. If the millions of money which were bor- rowed between 1792 and 1815 had been bor- rowed in stock bearing 5, 6, or 7 per cent, according to the rate which the circumstances of the time of borrowing made unavoidable, the public would have since been able to reduce the charge 1, 2, or 3 per cent, on the amount of the sums which were bor- LOANS IN NOMINAL CAPITAL. 291 rowed, in consequence of the reduced rate of interest on money. It has been usual to suppose that the higher rate of interest which the 5 per cent, stock bore above that of the 3 per cent, stock, during the war, was a justification for raising loans in the latter : but a reference to the actual prices of these stocks, from 1792 to 1803, will shew that the annual average excess of interest on 5 per cent, stock was no more than 12?. 6cZ. per cent. * : 3 per 1793 . Cent. 72 Interest. 5 ] £. s. d. 3 17 11 . )er Cent 106 . 1 £. 4 nterest. s. d. 14 Difference. s. d. . . 16 1 1794 . 70 4 5 8 . . 101 4 18 11 . . 13 3 1795 . 63 4 15 2 . 97 5 2 11 . . 7 9 1796 . 69 4 6 11 .' 100 5 . . 13 1 1797 . 54 5 11 1 . 81 6 3 4 . . 12 3 1798 . 48 6 5 . 69 7 4 . . 19 1799 . 53 5 13 2 . 81 6 3 4 . . 10 2 1800 . 61 4 18 2 . 90 5 11 1 . . 12 11 1801 . 60 5 . . 93 5 7 4 . . 7 4 1802 68 4 8 2 . . 98 5 1 10 . . 13 8 10)125 6 12 f. The prices of the 3 and 5 per cent, stocks are those in the first week of January in each year, and have been taken from a Table in Sir John Sinclair's History of the Revenue, vol. ii. p. 28. The rates of interest have been taken from Fairman on Stocks. U2 292 LOANS IN NOMINAL CAPITAL. and as the largeness of the sum of which any particular stock consists, has a consi- derable effect in bringing down the value of it, in consequence of the greater quantity of it that will be in the market for sale, had the loans been all made in this stock, this ex- ceeding of interest would certainly have been still less. The case in which the disadvantage of borrowing in a nominal capital at a low rate of interest is the most striking is, when funds can be provided for paying off the loans so borrowed ; and to shew this, it is necessary only to refer to the loan made in 1798, when 34,000,000/. of three per cent, stock was given for 17,000,000/. in money : for if this loan was now to be redeemed, it would be necessary to pay 95/. for every 50/. which was actually received. The debt created between 1775 and 1816, amounted in money to 417,851,817/. The capital that was funded amounted to 589,086,226/. Sup- posing, therefore, the three per cent, stock were to be at par, and that the debt was LOANS IN NOMINAL CAPITAL. 293 then to be redeemed, the public would sustain a loss of 171,234,449/.* Although the system of borrowing on an advance of capital at a low nominal interest is now universally allowed to be wrong, an opinion prevails that Government could not obtain loans of large amount in any other way ; but if the motives which induce per- sons to lend money are examined, there will appear to be no foundation for this opinion. When private individuals are the parties, four things are requisite in order to effect a loan. 1st. A party wishing to borrow. 2nd. The solvency of the party. 3rd. A readiness to pay the market rate of interest, and 4th. A party possessed of money by which he seeks to obtain a revenue by this rate of interest being secured to him. When these four circumstances occur, a loan takes place as a matter of course, because it is for the mutual benefit of both parties that it should take place then. * Dr. Hamilton, p. 246, 3rd edition. 294 LOANS IN NOMINAL CAPITAL. When Government is the borrowing par- ty, — as the question of solvency is at once settled, as the principal lent can always be obtained, and as Government is always ready to give something more than the market rate of interest, — it ought, instead of being compelled to borrow in this or that stock, to be able to choose its own arrangement for carrying into effect the main, and almost sole object of the lenders, namely, that of obtain- ing good interest for their money. Although this conclusion is so self-evident, it is practically true, that, for some reason or other, the lenders have had their own way. The reason given by persons who have experience in these matters is, that the taste of the public is for lending in a low priced stock, and that the loan-contractors are governed by it ; but this is not a true statement of the case, for the loan-contrac- tors are governed by what is for their own peculiar benefit in making a loan, and not by the taste or interest of the subscribers to it, whom they represent ; and it will be found, upon looking deeper into the case, LOANS IN NOMINAL CAPITAL. 295 that the trammels in which Government has been placed, are owing to the change which was made by Mr. Pitt, in 1793, in the man- ner of raising loans; by which loan-con- tractors were first made parties to the business. The manner of transacting loans prior to 1793 was by open subscription at the Bank of England. Terms were proposed by Government, and these were arranged so as to afford the subscribers a small additional rate of interest above the market rate ; and the subscription was generally filled in a short time*. In 1793, Mr. Pitt introduced the plan which has since been regularly acted upon, namely, that of the Chancellor of the Ex- chequer fixing the funds in which the loans are to be made, and giving public intima- tion that he is ready, on a certain day, to receive offers, and assign the loans, to the party who may be willing to propose the lowest terms. The consequence of this * Dr. Hamilton, p. 64, 1st edition. 296 LOANS IN NOMINAL CAPITAL. course of proceeding has necessarily been, that one individual, or one banking or mer- cantile firm, has become the representative of a body of subscribers, willing to take the loan on certain conditions, arranged among themselves ; but the individuals making the offers have had not only the interests of the subscribers to their lists to attend to, but their own special interests as contractors: these have sprung up from their subscribing large sums, with however no intention of paying them, but wholly with the view of making a profit by selling their new stock immediately after they are declared to have got the loan. Under these circumstances, it becomes the interest of the contractor to deal in three per cent, stock in preference to any other, because, in consequence of its large amount in the bank books, it is always more mar- ketable ; and hence it is, that, whatever may be the competition among these contractors, with respect to the rate of interest for which they are willing to make a loan, there is always a combination among them, founded LOANS IN NOMINAL CAPITAL. 297 on their mutual interests, to force Govern- ment to make it in a low priced stock. The whole, therefore, of the new scheme of dealing with loan -contractors, adopted by Mr. Pitt in 1793, for raising loans, may be set down to the fraudulence of ingenious reasoning on the part of great monied men, and to the influence of it in leading Mr. Pitt into their plans for securing to themselves great gains : and it is nothing more than an additional instance of their ingenuity in ad- vancing their own interests at the expense of the public, to say that, in requiring loans to be made in three per cent, stock, they are governed by the taste of the public for lend- ing their money in a low priced stock. The truth is, that the part of the public who are willing to lend their money to Government have no other object but to obtain a good rate of interest ; and that, if they were allowed to subscribe to loans as formerly, the Government would be able, as formerly, to obtain loans for stock of the same deno- mination as that of the money actually lent. This conclusion is borne out by the expe- 298 LOANS IN NOMINAL CAPITAL. rience of the effects of the old mode of transacting loans ; for, notwithstanding they were almost all made from 1735 to the end of the American war, in real capital, the rate of interest seldom exceeded that which the price of the funds indicated as the market rate of money. The loans raised in the seven years war amounted to 53.000,000/., and the capital that was funded amounted to 54,230,000/. The loans raised in the American war amounted to 79,175,000/., and the capital that was funded amounted to 111,075,000/.* * Dr. Hamilton, p. 169, 1st edition. CHAPTER XXII. TERMINABLE ANNUITIES. The making of loans in terminable annuities has this great advantage over all other plans, that the extinction of each loan is secured for a very moderate annual charge. By this plan, time does that necessarily for the public, which, if left to Sinking Fund schemes, might possibly never be done. Although this plan of borrowing is ac- companied with a higher rate of annual charge on the sum borrowed, than is neces- sary when borrowing in a perpetual annuity, this may be made very light by granting the annuity for a long period. The fol- lowing extract, from Dr. Price's work on Annuities, fully explains the advantage of borrowing in Terminable Annuities, over the practice he refers to, as commonly 300 TERMINABLE ANNUITIES. adopted. " It is obvious that accumulating debt so rapidly, and mortgaging posterity for eternity, in order to pay the interest of it, must, in the end, prove destructive. Rather than go on in this way, it is abso- lutely necessary that no money should be borrowed, except in annuities which are to terminate within a given period. Were this practised, there would be a limit beyond which the national debt could not be in- creased, and time would do that necessarily for the public, which, if trusted to the con- ductors of its affairs, would never be done. I am sensible, indeed, that the present burdens of the state would, in this case, be increased, in consequence of the greater present interest which would be necessary to be given for money ; but I do not con- sider this as an objection of any weight : for let an annuity be for one hundred years, such an annuity is, to the present views of man, nearly the same with an annuity for ever ; and it is also nearly the same in cal- culation ; its value at four per cent, being twenty-four and a half years' purchase ; and TERMINABLE ANNUITIES. 301 therefore, only half a year's purchase less than the value of a perpetual annuity. Sup- posing, therefore, the public able to borrow money at four per cent, on annuities for ever, it ought not to give above Is. Id. per cent, more for money borrowed for one hundred years. But should it be obliged to give a quarter, or a half per cent, more, the ad- ditional burden derived from hence would not be such as could be very sensibly felt, and the advantages arising from the neces- sary annihilation of the public debt by time, would abundantly overbalance them*." If all the loans which have been raised since the beginning of the war of 1739, had been borrowed in annuities for ninety-nine years, in ten years from this time the extinc- tion of them would commence, and in eighty- four years the whole debt incurred, up to 1815, would be extinguished : more need not be said to prove the expediency of bor- rowing on Terminable Annuities. The objection that is made to trying to raise money by this plan, is the same as that * Dr. Price on Annuities, vol. i. p. 273. 302 TERMINABLE ANNUITIES. made to borrowing in stocks of real capital, namely, a supposed unwillingness to lend money in any but a low priced perpetual stock. This has been shewn to be an objec- tion resting on no solid foundation ; and it is quite certain that if Government wished to raise loans on Terminable Annuities, it would be sure of obtaining them, (after, per- haps, some difficulty in counteracting the schemes and combinations which old loan- contractors would at first enter into to thwart it,) by having an open subscription, and offer- ing a proper rate of interest, and by not being checked by the failure of the first at- tempts. It is by making a proper use of Termi- nable Annuities, that the most easy, and at the same time, the most effectual means can be secured of redeeming a considerable part of the debt ; and, therefore, if any Sinking Fund is to be kept up, the whole of it should be applied in commuting some of the an- nuities for ever, of which the debt consists, into Long Annuities *. * See the Speeches of the Author in 1823, in the House TERMINABLE ANNUITIES. 303 If the three per cent, stock comes to par, and if it should, therefore, be advisable to pay off the four per cent, stock, this oppor- tunity should be taken for converting the 164,000,000/. of four per cent, stock into Annuities for ninety-nine years; and the three and a half per cent, stock, amounting to 81,000,000/., should be converted in the same way. If this transaction were properly managed, the public would, at the same time, derive the advantage of a large reduction of annual charge on account of these stocks. With respect to getting rid of the present great amount of unfunded debt, nothing would be more for the public advantage than paying it off gradually by giving Long An- nuities for Exchequer Bills, instead of fund- ing them in three per cent, stock. of Commons, for an explanation of the operation of ter- minable annuities in redeeming debt. — Hansard's Debates, vol. viii. pp. 536. 548 ; and see Appendix, No. V. CHAPTER XXIII. ACCUMULATION OF CAPITAL. The power possessed by this country, and at all times in full activity, of annually ac- cumulating several millions of new capi- tal, is that peculiar property, which has brought it, in defiance of all kinds of diffi- culties, to its present state of abundant wealth ; and which will probably lead to such a further increase of wealth, as will make appear, what now seem to be circum- stances of depression and decline, when looked back upon some years hence, no- thing more than groundless and frivolous apprehensions. It has been shewn in the preceding pages, 1st, That it % was the power of accumulation which carried the country successfully ACCUMULATION OF CAPITAL. 305 through the financial efforts of the last war. 2dly. That it has since greatly spread and lightened the pressure of taxation. 3dly. That its continuing to work in the way it has, will hereafter place the country in such a condition, as to wealth, that provision may be made by war-taxes, for the expenses of future wars ; and it may be added, as what may, in all probability, be a fourth result of it, that in time it will afford the means of applying many millions annually, of real surplus revenue, to the redemption of the debt. Although a great many circumstances have been pointed out in considerable detail, that are great obstructions in the way of the accumulation of capital ; such as the taxes on materials, on manufactures, and on food, the protecting system, and the excessive taxes on some principal articles of consump- tion, there are, besides, other parts of our commercial system, which are extremely in- jurious in diminishing the employment of capital and labour, and which ought to be removed : for instance, the protection given x 306 ACCUMULATION OF CAPITAL. to the shipping interest * ; the usury laws ; the monopoly of the East India Company ; the Bank monopoly, and the prohibition of the exportation of machinery. Each of these measures prevents the ca- pital, labour, and skill of the nation, from being as productive as they would be, if they could be freely employed. But the manner in which this effect is occasioned, * The shipping interest is protected in the following ways : 1. By a duty of 50/. per cent, on foreign ships, and by pre- venting any ship from continuing to enjoy the privilege of a British ship, after the same shall have been repaired in a foreign country, if the repairs exceed the sum of 20/. a ton. 6 Geo. IV. c. 189, §6. 2. By a duty of 41. 15s. a cwt. on foreign dressed hemp, and a duty of only 4*. 8d. on undressed hemp. 3. By preventing more than 50,000 tons of coals, culm and cinders, from being brought to London by inland navi- gation. 45 Geo. III. c. 128. 4. By a duty of 21. 1 5s. a load on European timber, and a duty of 1 0*. a load on American timber. 5. By a duty of 8/. 8s. a cwt. on refined sugar when im- ported. 6. By preventing a considerable number of articles from being imported, called enumerated goods, except in Brilish vessels, and by several other provisions in the navigation laws. ACCUMULATION OF CAPITAL. 307 has been so fully explained in numerous works which have recently been published, that it would be merely to repeat what they contain, to say more upon the subject *. The vast importance of getting rid of every kind of impediment in the way of the accu- mulation of capital points out the expe- diency of losing no opportunity of removing all these obstructions. A review of all that has been suggested, as wanting to place the finances and indus- try of the country on a proper footing, ex- hibits the consolatory fact, that it may be effected without any difficulty, beyond that of having to contend against the importu- nities of those persons who are interested in the monopoly and regulating system ; for there is nothing wrong, which may not be set right by the mere repeal of some erro- * See the following works — Bentham on Usury, and the Edinburgh Review, vol. xxvii. p. 339, on Usury Laws. — " Free Trade and Colonization in India," by Mr. Craw ford. — " Ob- servations on Paper Money, &c." by Sir Henry Paiinll, Bart. — Report of Select Committee of the House of Com- mons, on the Exportation of Machinery, Session 1825. X 2 308 ACCUMULATION OF CAPITAL. neous legislative enactment, and, therefore, all that is wanting, is to undo what has been badly done. The statements in these pages which shew what have been, since 1825 (the sup- posed era of free trade), the quantity of fo- reign manufactures imported ; what the state is of the colonial trade, and what the exist- ing restrictions are on shipping and naviga- tion, when coupled with the actual state of the banking trade, of the trade with India, and of the usury laws, place beyond all doubt the fact that nothing can be more ut- terly groundless than the common notion that the changes in our commercial laws of 1825 established a free trade. The arguments and conclusions, therefore, of those persons who so confidently maintain that the nation has been ruined by free trade, are quite worth- less, and the evils which exist must be traced to some other cause. Those individuals who so much fear a system of free trade, instead of assuming it to be wrong, should attempt to refute by a dispassionate analysis the ar- guments of its advocates, which are advanced ACCUMULATION OF CAPITAL. 309 to shew that free trade affords the most ex- tensive employment of capital and labour, and thus contributes to the greatest possible amount of annual productions, and to a con- tinued and rapid accumulation of national wealth. The advocates of it desire to have its merits decided by the practical utility of the principle ; and they fearlessly refer to the facts belonging to every branch of trade, and to all experience for the confirmation of the soundness of their doctrines. If once men were allowed to take their own way, they would very soon, to the great advantage of society, undeceive the world of its errors in restricting trade, and shew that the passage of merchandize from one state to another ought to be as free as air and water. Every country should be as a gene- ral and common fair for the sale of goods, and the individual or nation which makes the best commodity should find the greatest advantage. The distance and expense of carriage are sufficient reasons for any na- tion's preferring its own goods to those of others, and when these obstacles cease, the 310 ACCUMULATION OF CAPITAL. stranger is preferable to our own country- man, otherwise domestic trade is injured in- stead of being favoured. For these reasons, trade claims liberty instead of those protec- tions by which it has been discouraged. Happily, the time, if not yet arrived, is rapidly approaching, when the desire to re- duce the principles of trade to a system of legislative superintendence will be placed in the rank of other gone-by illusions. The removal of obstacles is all that is required of the legislature for the success of trade. It asks nothing from Government but equal protection to all subjects, the discourage- ment of monopoly, and a fixed standard of money. Restraints, regulation, inspection, have no success. All that is wanting is, to let loose the means this country has within itself of protecting and promoting its in- terests, to secure its future career in all kinds of public prosperity. APPENDIX. APPENDIX. No. I. ARTICLES, Being Materials of Manufactures, Buildings, Ship Buildings, fyc §c. An Account of the Net Produce of the CUSTOMS DUTIES in the United Kingdom, as stated in the Finance Accounts for the Year 1827, on each of the following Articles; and showing the Rate of Duty on each Article : — Articles. Year 1827 : Aunotto . Antimony, crude Argol Ashes, Pearl and Pot . Barilla and Alkali Bark, Oak, & Corktree Brimstone Borax Bristles Net Produce in the United Kingdom, £. s. d. 1,877 16 10 697 15 9 1,123 2 6 5,777 13 2 79,419 9 11 Cochineal Cork 29,138 4 4 5,243 8 1 2,737 2 3 25,868 19 9 4,162 13 11 20,390 5 3 Rates of Duty. Flag Annotto, 2d. per lb. Other sorts, Is. per lb. 1 5.v. per cwt. Of British Possessions, Is. per cwt. Of other places, 2s. per cwt. Of British Possessions, free. Of other places, 6s. per cwt. If not containing a greater proportion of mineral alkali than 20 per centum, Until the 6th Jan. 1829 £8 10 per ton. From 5th Jan. 1829 to 6th Jan. 1830 . . 6 10 per ton. From and after 5th Jan. 1830 . .50 per ton. If containing a greater proportion of alkali than 20 per cent, higher rates of duty, in proportion to the amount of such excess. 8cl. per cwt. Rough, Gd. per. cwt. Refined 6s. per cwt. In flour, 9v. '.id. per cwt. Refined, Gd. per lb. Unrefined, 3d. per lb. Dressed, Is. per 11). Rough and in the tufts, and not sorted, 2U. per II). Sorted or arranged in Colours, and not entirely rough S in the tufts, 3Ai/. perlh. Of any British Possessions, Id. per lh. Of other places, Gd. per lb. 8*. per. cwt NET PRODUCE OF THE [AP. Articles. Dye & Hard Woods, viz. Boxwood . . Brazil & Zebra Wood Net Produce in the United Kingdom £. s. d. 2,179 1 9 634 17 7 Braziletto or Jamaica Wood 100 14 Camwood 479 18 Cedar wood . 4,498 6 Ebony 169 19 9 Fustic . 821 14 5 Lignum Vitae 648 8 6 Logwood . 1,441 8 3 Mahogany . . 68,729 19 4 Nicaragua wood 1,423 7 2 Red or Guinea wood 3 1 4 Barwood 74 3 7 Saunders, Red 97 9 5 Rosewood 7,276 5 4 Elephants' Teeth 3,257 12 9 Feathers for Beds 5,523 17 3 Flax and Tow, and Co dillaofHemp&Flaj l 8,974 4 Furs 21,276 9 Rates of Duty. Of British Possessions, 1/. per ton. Of other places, bl. per ton. Brazil wood, 5/. per ton. Zebra wood, 21. per ton. 16*. 8d. per ton. 15*. per ton. Of British Possessions, 10*. per ton. Of other places, 21. 10*. per ton. Of any British Possession, and imported directly from thence, 15*. per ton. Otherwise imported, 10/. per ton. Green Ebony, of and from any British Possession, 3*. per ton. From any British Possession, 3*. per ton. From other places, 4*. 6d. per ton. Of British Possessions, 1 0*. per ton. Of other places, 21. per ton. From any British Possession, 3*. per ton. From other places, 4*. 6d. per ton. Of Bermuda or the Bahama Islands, and imported direct from thence, or imported direct from he Bay of Hon- duras, in aBritish ship cleared out from the port of Belize, 21. 10*. From Jamaica, 41. per ton. Otherwise imported, 71. 10*. per ton. 15*. per ton. 1 5*. per ton. 7* per ton. 12*. per ton. 10*. per ton. 1/. per cwt. 21. 4*. per cwt. \d. per cwt. Badger, 1*. Gd. each. Bear, from the British Possessions in America, 2s. 6d. each. from other places, 4*. 6d. each. Beaver, from any British Possession in America, Ad. each. from other places, 8d. each. Cat, from, any British Possession in America, 3d. each. from other places, 6d. each. Coney, Is. per 100. Ermine, 8d. each. Fisher, from any British Possession in America, 6d. each. from other places, 1*. each. Fitch, 3s. 2d. per dozen. Fox, from any British Possession in America, Ad. each. from other places, 8d. each. NO. I.] CUSTOMS DUTIES IN 1857. Articles. Furs, — (continue//). Net Produce in the United Kingdom £. s. d. Galls Gums, viz. Aniini and Copal Arabic Guaiacum Lac, of all sorts Senegal Tragacanth . Hair, Horse 864 5 9 2,950 14 2 9,075 1 8 673 17 3 5,102 2 1 4,601 6 8 1,055 12 3,199 6 Rates of Duty. Hare, 1*. per 100. Leopard, 9s. 6d. each. Lion, 6s. each. Martin, from any British Possession in America, 3d. each. from other places, 6d. each. Mink, from any British Possession in America, 2d. each. from other places, Ad. each. dressed, 2s. each. Mole, 6d. per dozen. Musquash, Is. per 100. Nutria, 12s. 6d. per 100. Otter, from any British Possession in America, Is. each. from other places, Is. 6d. pr cwt. From other places, 2d. per lb. 4.\. '.)d. per lb. 207. per centum ad valorem. NET PRODUCE OF THE [AP. Net Produce in the United Kingdom Orpiment Orsedew Parchment Pasteboards Plaster of Paris Platina Ore of . Polishing Rushes Pumice Stones Rosin Saccharum Saturni Sal Ammoniao Scaleboards Seahorse Teeth Stones, Flint, for potter; for lithography Tarras Teasles . . Terra Japonica . ■ Sienna . Umbra . Tiles Timber, Anchor Stocks 36 8 11 10 1 9 10 10 2 9 28 12 10 2 1.3 290 13 6 8 2 3 77 1 1 115 10 9 81 6 3 115 3 7 6 15 4 758 8 10 455 6 1 8 18 2 38 12 2 Tin Varnish unenumerated Vellum Weld Woad 1 1,895 20 31 11 6 8 3 8 7 8 Wool, Beaver . Coney Hares Yarn, Cable Worsted . 143 3 3 5 18 8 5 9 3 Rates of Duty. 1/. 8*. 6d. per cwt. 6d. per lb. 1 0.s. per dozen sheets. 3/. 84'. 2d. per cwt. 1*. per cwt. Is. per oz. 5/. per centum ad valorem. 20/. per centum ad valorem. 1/. 1 3s. Ad. per ton. Of the British Possessions, 3s. 2d. per cwt. Of other places, 4s. 9d. per cwt. Wd. per lb. 3r/. per lb. 3/. 8s. 2d. per cwt. 3/. 4s. per cwt. 2s. 6d. per ton. 3s. per cwt. Is. 3d. per bushel. Is. per 1,000. 3s. per cwt. II. lis. 8d. per cwt. 1 2s. per cwt. Dutch tiles, 15/. per centum ad valorem. Other sorts, 50/. per ditto ditto. Of the British Possessions in America, 10 d. each. Of other parts, 8s. Ad. each. 21. 1 0s. per cwt. 30/. per centum ad valorem. 7s. 2d. per skin. Is. per cwt. 3s. per cwt. Is. 7d. per lb. Cut and combed, 4s. 9l 4 / 6/ 1819 1820 1821 1822 — — — — 1823 — — — — 1824 {Transferred to Customs froml \ 5 April. 1825. J 3/ 5/ 1825 . 3/ 3/ 1826 — — 1827 — — — — 1828 CUSTOMS AND EXCISE DUTIES. [\P. TOBACCO . . Quantities NET REVENUE Years. Entered for of Hoiiie Consumption. CUSTOMS and EXCISE. lbs. £. s. d. 1789 2,765,441 128,704 8 4 1790 2,900,437 133,195 18 10 1791 2,549,043 117,420 2 1792 1,767,581 80,693 4 5 1793 5,568,857 125,844 17 1 1794 9,426,211 193,158 10 7 1795 7,874,409 215,719 9 1796 6,045,790 186,759 19 1797 8,445,555 267,721 16 4 1798 4,894,121 215,317 12 7 1799 5,876,172 288,028 4 9 1800 6,737,275 327,916 9 1801 6,389,751 285,482 6 4 1802 6,327,542 309,738 9 2 1803 5,278,511 265,944 3 4 1804 5,783,487 314,007 5 8 1805 4,158,794 302,316 8 1 1806 5,082,186 359,867 6 4 1807 4,531,049 315,417 4 3 1808 5,847,116 403,973 3 8 1809 6,497,662 451,278 19 11 1810 6,221,646 444,198 5 1811 6,453,024 552,082 9 9 1812 5,896,702 697,897 9 11 1813 5,944,817 746,006 5 2 1814 4,869,304 653,708 12 11 1815 4,748,205 740.279 13 1 1816 4,732,085 750,510 7 6 1817 4,778,469 757,316 8 3 1818 4,194,041 664,183 9 1 1819 3.466,852 614,989 5 7 1820 2,582,498 516,446 2 6 1821 2,614,954 522,168 6 9 1822 3,309.072 664,016 7 4 1823 3,546,126 730,507 12 8 1824 3,749,732 750,589 5 4 1825 4,160,049 728.288 13 11 1826 3,898.647 580,893 11 1827 4,041,172 603,037 18 9 1828 4,013,915 595,b83 4 3 NO. II.] CUSTOMS AND EXCISE DUTIES. . . IRELAND. RATES of DUTY per lb. on UNMANUFACTURED TOBACCO. CUSTOMS. EXCISE. TOTAL. Years. 6d. Irish currency. 6d. Irish currency. 1 / Irish currency. 1789 — — — 1790 — 1791 — . _ 1792 Ad. . ditto . . 2d. . ditto . . 6d. . ditto . . 1793 — 1794 bd. . ditto . . 3d. . ditto . . 8d. . ditto . . 1795 — __ 1796 1797 7d. . ditto . . bd. . ditto . . 1/ . ditto . . 1798 7 z \d. ditto — 1/ T % ditto . . 1799 — — 1800 — — — 1801 f7 T J(/. per and 3/) t per 1001b. J — (Ijis P er lb- an( H \ 3/ per 1001b. J 1802 — — — 1803 8d. British currency. 9d. British currency. 1/5 British currency. 1804 — — — 1805 — — 1806 6d. . ditto lid. . ditto . . 1/5 . ditto . . 1807 — — — 1808 — , — — , 1809 — — — 1810 7 ±%d. . ditto . . 1/7 . ditto . . 2/2 ii ditto . . 1811 — — — 1812 9 ftd. . ditto . . 1/11 . ditto . . 2/8 T \ ditto . . 1813 — — — 1814 1/ . ditto . . 2/2 . ditto . . 3/2 . ditto . . 1815 — — — 1816 — — 1817 — — — 1818 3s. . ditto 4/ . ditto . . 1819 — — — 1820 — — 1821 — — 1822 — — — 1823 — ("Transferred to Cus- ) 1824 3#. . ditto . . < toms, from 5th [ April, 1825. \ 31 . ditto . . 1825 — — — 1826 — 1827 — — — L828 \, 2 3XS03) 3 IA\ 4/ Per Ir 10 | 4/K the formi // me 1789 . 48 1790 . 49 1791 . 47. 1792 . 44. 1793 . 19. 1794 . 14 1795 . 54! 1796 . (i 1797 . l: 1798 . 2: 1799 . 19! 1800 . IS 1801 . 7: 1802 . 172 1803 . 13C 1804 . 123 1805 . 61 1806 . 56 1807 . 80 1808 . 44 1809 . 88 1810 . 64 1811 . 7. 1812 . ioo; 1813 . 48, 1814 . 20, 1815 . 40, 1816 . 22, 1817 . 25, 1818 . 45,' 1819 . 42,- 1820 . 12,; 1821 . 28,; 1822 . 25,; 1823 . 25,< 1824 . 24,1 1825 . 95,f 1826 1827 I N.'S Note. — Tlu. (, II.] 1810 1811 1812 1M4 1813 1816 1817 1818 1819 1820 1821 1822 1823 1824 1825 WINE,— GREAT BRITAIN. Ql AXTITIESi Wine Gallon*. 1789 . 234,299 1"90 . 246, 1 14 1791 250,839 303,727 1793 . 256,160 1794 . 99,118 i;'.)-> . 118.587 1796 . 50,881 1797 j. Excess of Export 4,874 gallons. 1798 . 45,367 1799 . 51,126 1800 . 83,471 1801 . 141,693 1802 . 129,280 1803 . 192,136 1804 . 21,804 1805 . I.3.9M, 1806 . 156,902 1807 . 160,114 1808 . 186,944 125,266 190.917 63,221 77,312 186,747 36,880 301,024 126,625 147,671 266,424 215,846 182,175 165,791 177,758 183,296 201,901 534,015 297,372 Imperial Gallons, equal to 356,846 Wine Gallons. 283,726 Imperial Gallons, equal to 340,471 Wine Gallons. 476,134 Imperial Gallons, equal to 451,361 Wine Gallons. Wine Gallon*. 5,580,366 6,245,983 7.407.4 17 6,634,V.50 6.71111,102 6.808.5 14 5,681,502 3,975,775 4.715.290 4,726,505 7,645,400 6,864,617 6,226,469 7.989,330 4,818,915 4,501,565 5,780,233 5,762,223 6,221,590 5,682,821 6.614,359 5.797,653 5,059,178 4,531,821 4,904,783 5,667,411 4,294,182 5,466,951 5,873,066 4,762,754 4,837,785 4,850,778 4,797,401 5,108.114 5.274,831 8,121,978 5,078,306 Imperial Gallon 6,093,968 5,768,032 Imperial Gallons. 6,921,639 5,941,054 Imperial Gallons. 7,129,264 Wine Gallon 5,814,665 6,492,317 3,970,901 4,760,657 4,777,631 7,728,871 7,006,310 6,353,749 8,181,466 4,840,719 4,565,551 5,936,235 5,922,337 6,408,534 5,808,087 6,805,276 5,860,874 5,136,190 4,718,568 4,941,663 5,968,435 4,420,807 5,614,622 6,139,490 4,978,600 5,019,960 5,016,569 4,975,159 5,291,410 5,479,732 8,655,993 5,375,678 Imperial Gallons, equal to 6,450,814 Wine Gallons. 6,051,758 Imperial Gallons, equal to 7,262,110 Wine Gallons. 6,317,188 Imperial Gallons, equal to 7,580,625 Wine Gallons. NET REVENUE of CUSTOMS and EXCISE. 30,549 10 8 41,352 16 6 43,417 8 59.693 16 5 30,398 6 8 14,487 13 6 55,579 4 11 25,253 13 5 36,232 16 4 33,247 11 31,316 6 4 42,341 16 5 84,686 13 61,514 17 2 72,103 13 4 34,423 7 4 81,386 1 94,813 3 5 89,139 3 7 126,936 11 1 684,969 8 7 779,209 10 10 873,331 19 9 959.951 6 7 660,377 18 6 780,536 5 6 1,375,143 10 2 1.134,270 6 2 1,347,432 16 4 1,339,414 5 8 1.661,510 5 8 1,924,871 12 n 1,908,310 16 11 1,870,358 2 7 2.069,252 19 5 1,779.899 18 1 1,922,180 7 4 2,225,615 8 3 2,2 43,058 15 2 2,226,800 8 The net receipt of Duty on French and other descriptions of Wine caunot be separately stated for these years, in consequence of the destruction of the Custom's Re- cords by Fire. 73,185 5 3 122,662 1 5 76,046 15 87,475 9 11 155,370 10 126,667 6 11 106,892 12 1 97,486 17 5 104,425 1 5 106,982 11 1 117,202 1 8 166,184 6 8 Allowances for 107,292 14 2 102,509 16 6 136.024 9 9 1.959,655 14 1,972,637 16 1,534,252 10 1,936,244 18 2,086,010 1 1,675,429 15 1,711,503 10 1,700,004 10 1,689,588 9 1,800,484 2 1,850,751 12 1,648,869 1 Stuck in hand . 1,162,825 7 4 1,824,040 15 3 1,370,098 5 7 RATES OF IH'TY. CUSTOMS. £. s. d. 721,518 19 3 820,562 7 4 916,769 5 1,019,645 3 690,686 5 2 795,023 19 1,430.722 15 1 1,159,523 19 7 1,383,665 12 8 1,372.661 6 7 1,692,826 12 1,967,213 8 5 1/(92.997 9 11 1,931,872 19 9 2.141,356 12 9 1,814,323 5 5 2,1108,866 8 4 2. 120,428 11 8 2,334,197 18 9 2,353,736 19 1 2,361,113 18 3 2,513,615 16 3 2,169,871 6 3 1,911,352 19 11 Custom's Records destroyed 2,032,840 19 2,095,299 18 1,610,299 5 2,023,720 8 2,241,380 1,802.097 1,818,396 2 5 1,797,491 7 10 1,794,013 11 2 1.907,466 13 3 1,967,953 13 10 1,815,053 8 5 1,021,044 3 11 1 11 794.0119 4 6 1,270,118 1 6 1,426,550 11 9 1,506,122 15 4 Per ir,„e Ooll.jn. 2/4 1/6| 1 l/6j I l/6j |>/8 I 1/6| 1 2/4 5/24 M idem and Spanish fUemsh. Cape. Per (I ine Qalhi -I' Per Wine Gallon. !1 \ ll ± i \ 1 !l \ ll l 3 >1 -^ 2 ' 5 H 2/5H 4.'1 Sfllj 3/M 3JH 3/lf 3/3 3/3J 3/5 Red 4/44 White 3/ AlK.irt: 3/5 4/6} 3/li 3/3 3/5 1/1* 4<-4 3/5 6 21 4/2/ 4/ Per Imperial Gallon. 7/3 | 4/10 | 4/10 | 4/10 | 4/10 | 2/5 | 4/10 equal tu the former Duties per Wine Gallon. 11 •-!. 3 6., 4/2 4/2 Transferred to Customs from 2d March, 1825. s <>,. 8/6 8/10 10/4 11/34 11/5* 5/11 5/111 6/111 7)1 7/8 7/8 I I 5/94 5/81 5 III; 6 in; 7/6 77 11/54 7/8 7)7 5/9} 5/8i 6 104. 7/6 7/7 7/6J 1, ; I, ,, 9/44 3/9 7/-4 2/64 7/7 Per Imperial Gallon. 7/3 I 4/10 I 4/10 I 4/10 I 4/10 1 2/5 | 4/10 equal to the former Duties per Wine Gallon. Note.— the quantities printed in bold figures, with the i written with lied Ink in the original. Excise Duty on Wine in the Stocks of Dealers j otherWino £20 perTu [mv mi. ir. WINE,— IRELAND. Years. QI ANTITIES retained for Hon 8 Consumption. NET REVENUE (CUSTOMS.) RATES of CUSTOMS DUTY, per Tun, Irish Mcas I French. Other Sorts. Total. French. Other Sorts. Total. French. Madeira. Portugal. Rhenish. 8 $|™* Spanitb fUd, and Sicilian. and otl.er sorts. It'me Gallons, IVmr Gallons. IVine Gallons. £. s. d. £. s. d. £. s. d. £. s. d. £'. s. d. IR] £. s. d. SH CURRENCY ■ £ s. d. £. ... d. i. t. d. £. ,t d. i;s9 . 483,210 853,043 1.336,253 61,437 14 8 68,749 13 8 130,187 8 4 33 7 22 4 8 22 4 8 27 19 10 JJ 11 \ 8 22 4 8 28 9 10 j 1790 . 496,034 932,895 1,428,929 63.056 1 7 75,533 11 138,589 12 7 — — — — — — 1791 . 47P,263 952.009 1,430,272 60,602 16 9 77,407 10 11 138,010 7 9 35 4 ,% 29 7 10} 29 18 -1, 1792 . 443,268 896,534 1,339,800 56,540 12 6 72,569 13 129,110 5 6 — — — — — 1793 . 195,050 846,882 1,041,9,12 24,917 1 2 69,589 17 6 94,506 18 8 — — — — — — 1794 . 145,799 1,228,630 1,374,429 18,614 7 4 99,224 14 11 117,839 2 3 — — — — — — 1795 . 549,915 2,409,089 2,959,004 69,807 4 4 194,358 1 2 264,165 5 6 — — — — — — 1796 . 64,808 1.1.14,321 1,199,129 10,584 5 118,144 4 6 128,728 9 6 44 13 3f 5 28 13 7 28 13 7 S 13 7 28 13 7 1797 . 13,185 299,027 312,212 2,684 6 10 38,623 16 3 41,308 3 1 54 7 2 " 35 2 2 35 2 2 — 35 2 2 1798 . 25,930 1,532,335 1.558.265 4,679 13 7 179,809 18 11 184,489 12 6 — — — — — — 1799 . 199,113 2,389,053 2,588,166 38,231 13 304,963 1 343,194 13 1 — — — — — — 1800 . 12,821 1,012,011 1,024,832 5,005 5 6 152,589 7 6 157.594 13 64 6 41 10 11} 41 10 11} 41 10 11} 41 10 II J 1801 . 72,350 1,173.392 1,245.742 16,874 17 10 175,789 6 192,663 18 4 — — — — — — 1802 . 173,452 2,006,898 2,180,350 41,696 10 8 306,503 4 1 348,199 14 9 68 4 6 44 13 11} 43 12 10} 34 2 4} 4: 12 10} 43 12 10 | 32 ti Ii 35 4 6 1803 . 130,465 1,559,826 1,690,291 32,345 18 4 250,226 1 10 282,572 2 75 11 49 3 5 48 4 37 10 8 4£ 4 48 4 BRI TISH CURRE NCY 1804 . 123,393 1,585,117 1,708,510 31,037 16 11 296,094 10 11 327,132 13 10 87 59 1 2 58 60 o °{wttJs o o o o 1 Canary, i 65 | 65 1805 . 61,682 920,008 981,690 24,785 4 6 227,142 14 9 251,927 19 3 (Red 6<, '\ White hi 18 4 1 Sicilian, ( 58 I 58 1806 . 56,551 997,428 1,053,979 21,225 3 11 232,877 3 9 254,102 7 8 — — _ 5, 1807 . 80,130 1,523,148 1,603,278 29,970 13 2 365,718 9 2 395,689 2 4 — — — — , — 1808 . 44,226 1,145,490 1,189,716 13,894 9 280.842 14 294,736 14 9 — — — — — 1809 . 88,369 1,176,557 1,264,926 39,282 8 1 285,607 2 4 324,889 10 5 — — — — — 1810 . 64.107 956,168 1,020,275 22,958 1 250,013 11 7 272,971 12 7 105 18 71 13 70 12 78 18 7( 12 70 12 70 12 1811 . 7,834 886,958 894,792 4,242 18 1 258,893 10 4 263,136 8 5 — — — — — 1812 . 100,862 792,084 892,946 45,226 8 7 232,838 18 9 278,065 7 4 — — — — 1813 . 48,694 711,310 760,004 25,313 12 11 228,451 8 7 253,765 1 6 ' 139 11 4 79 19 9 78 18 4 91 13 2 18 4 78 18 4 78 13 4 1814 . 20,294 615.843 636,137 13.070 15 11 221,665 11 4 234,736 7 3 \ 1815 . 40,893 689,458 730,351 31,515 15 11 261,575 15 4 293,091 11 3 1816 . 22.174 416,728 439,602 13,569 6 7 153,588 15 5 167,158 2 1817 . 25,840 545,756 571,596 15,018 4 4 185,873 7 74- 200,891 11 111 1818 . 45,913 596,293 642,206 26,019 19 4 199,015 11 6± 225,935 10 10+ 1819 . 42,488 547,366 589,854 24,061 14 7 179,200 5 203,261 19 7 1820 . 12.721 495,780 508,501 7,485 18 5 161,935 7 (|i 160,421 5 54 1821 . 28,206 596,495 624,701 16,407 18 11 192,598 12 1 209,006 11 1822 . 25,780 543,258 569,038 14.772 4 3 174,095 16 3^ 188,868 64 1823 . 25,402 521,816 547,218 14,684 4 8 166.080 12 3| 180,764 16 111 1824 . 24,1122 540,507 564.529 13,779 5 3 171,379 6 1 185,158 11 4" 1825 . 95,507 46,333 858,303 639,154 953,810 685,489 20,413 1 13 120,242 5 114, 140,655 7 li Imperial Gallons, Imperial Gallons, Imperial Gallons, 1 V Same Rates as ii Great Britain, from 5th July, 1814. 1826 ■ equal to equal to equal to > 16,507 13 7 138,653 18 lli 155,161 12 6£ / 65,601 766,985 822,586 Wine Gallons. Wine Gallons. Wine Gallons. 1 27,564 747,119 774,683 | Imperial Gallons, Imperial Gallons, Imperial Gallons, 1827 equal to equal to equal to \ 10,092 9 10 163,944 6 9 h 174,036 16 74, 33,076 896,543 929,619 Wine Gallons. Wine Gallons. Wine Gallons. I 46,330 789,690 836,020 Imperial Gallons, Imperial Gallons, Imperial Gallon*, 1828 equal to 55,596 Wine Gallons. equal to 947,628 Wine Gallons. 1,003,224 Wine Gallons. [ 16,771 5 1 177,157 5 8 193,928 10 9 / A ote.— The Quantities printed in bold fig ires, with the words in italic, were written with Red Ink in the original. N. B.— There was ao Excise Duty on Wine, in Ireland, during the years above stated £. s d. 22 4 8 28 13 7 35 2 2 41 10 11 43 12 10 48 4 I Canary, (65 ) Sicilian, 58 70 12 78 18 4 1814. £ ». d. 28 9 10 29 18 4= 32 4 f 35 4 6 65 58 70 12 rs 18 4 uring the years above stated. FOREIGN SPIRITS, GREAT BRITAIN. XXIV CUSTOMS AND EXCISE DUTIES. [AP. FOREIGN SPIRITS . . Quantities Years. Retained for Home Consumption. NET REVENUE of CUSTOMS and EXCISE. Brandy, Geneva, &c. Rum. ff'i/ie Gallons. Wine Gallons. £ s. J. 1789 2,002,626 2,160,183 952,392 13 5 1790 2,225,405 2,274,533 1,001,415 17 4 1791 1,949,418 2,505,472 999,481 3 11 1792 1,984,822 1,812,108 1,008,098 3 5 1793 1,557,876 2,202,133 1,002,976 16 11 1794 1,667,721 2,590,365 1,100,504 1 5 1795 949,606 2,468,818 957,512 7 5 1796 1,237,188 1,885,706 1,049,610 18 2 1797 1,669,787 2,142,047 1,317,520 8 6 1798 1,521,179 1,712,512 1,305,937 2 9 1799 1,618.855 2,076,586 1,423,961 4 11 1800 2,172,618 2,622,837 1,895,276 14 3 1801 2,631,055 2,445,032 2,202,123 2 3 1802 2,806,736 3,208,378 2,534,152 11 10 1803 2,763,575 3,543,997 2,668,884 5 8 1804 1,606,635 1,960,620 2,163,105 19 10 1805 1,991,002 2,220,566 2,613,835 8 1806 2.439,793 2,455,952 3,094,477 12 1807 2,200,728 2,671,935 3,019,777 8 11 1808 2,758,676 2,897,513 3,882,304 6 8 1809 1,172,211 3,060,664 2,790,378 14 1 1810 2,146,055 3,641,998 3,850,938 2 11 1811 1,329,467 3,615,570 3,121,766 15 7 1812 224,896 4,191,467 2,601,445 8 10 1813 287,050 3,944,613 Customs Records destroyed 1814 373,009 4,336,284 2,926,113 11 1815 1,016,462 3,962,108 3,193,677 13 6 1816 913,242 2,889,600 2,495,658 14 9 1817 887,400 2,853,847 2,454,997 16 9 1818 773,805 3,133,031 2,504,804 11 5 1819 1,067,934 3,047,877 2,735,315 8 1820 1,137,517 2,963,221 2,755,604 19 7 1821 1,204,888 2,716.250 2,711,670 14 1 1822 1,308,332 2,678,838 3,112,506 18 10 1823 1,399,065 2.798,494 2,909,590 18 1 1824 1,579,584 3,051,362 3,089,121 1 5 1825 f 1,686,043 1,540,322 ImGal. 2,502,671 4,277, 5 58 Im.Gal. 2,865,944 8 3 ) 1826 < { equal to 1,848,386 Wine Gallons. 1,363,977 Im.Gal equal to 5,133,070 Wine Gallons. 3,265,366 Im.Gal. > 3,529,160 14 8 j 1827 ) [ equal to 1,636,772 Wine Gallons. 1,370,966 Im.Ga.. equal to 3,918,439 Wine Gallons. 4,252,935 ImGal. \ 2,915,432 5 4 ) 1828 I equal to equal to I 2,921,251 12 8 ) 1,645,159 3,903,534 1 Wine Gallons. Win. Gallons. J Note. — The Quantities printed in bold figures, with the words NO. II.] CUSTOMS AND EXCISE DUTIES. . . GREAT BRITAIN. \\\ RATES OF DUTY. CUSTOMS. Brandy. Geneva. Per Wine Gallon. 9rf. 9rf. bd. 9Ifi 1/51 1/6 1/91 1/10 1 1 A "jo 9i£ ( /. "if i/H 1/3 1/3 A 1/4,% 1/6 1/91 1/10 5$d. 7 lid. 9d. 10,/. lOfcrf. lOffrf. 1/ 1/2J 1/3 Brandy and Genera. Per ffine Gallon. 3/7 4/3 5/1 5/11 6 'J 7~7 i,o 12 7A 15/H 19/1* 17/0^ 4^3 4 11 5^7 6/3 6/11 10 4* 18/10 T 3 5 18/10/ g 10/6 { Per Imperial Gallon. 22 .6 | 22/6 | 8 6 equal to, per Wine Gallou. 18/9 18/9 7/1 9/3 Transf. to Customs from 5 April, 1825. TOTAL. Brandy. Per Wine Gallon. 5/ 5/10 6/8 7/6 8/4i§ 8/7& 9 5 fe 9 2 1| 9 5£{j 13/ 10 a 13/11| 14/0 5 % 14/1 ^ 16/7^ 16/7* 20/7| 20/111 W/9^ 18/10ft 5(_ 5/10 6/8 7/6 4±a ^2 9/4& ., --Is 9/4*$ 13/9 13/10* 13/10| 13/llJf 16/5^ 16/7* 20/7| 20/111 l8/9, 3 a 18/ 10^ 4 L 4/8 5/4 G L em 6/10^ 7/"Y Ink in the original. XXVI CUSTOMS AND EXCISE DUTIES. [AP. SUGAR 1789 1790 1791 1792 1793 1794 1795 1796 1797 1798 1799 1800 1801 1802 180 J 1804 1805 1806 1807 1808 1809 1810 1811 1812 1813 1814 1815 1816 Quantities retained for Home Consumption. Cwt. 1,547,109 1,536,232 1,403,211 1,361,592 1,677,097 1,489,392 1,336,230 1,554,062 1,273,722 1,476,552 2,772,538 1,506,921 2,773,795 2,250,311 1,492,565 2,144,369 2,076,103 2,801,747 2,277,665 2,842,813 2,504,507 3,489,312 3,226,757 2,604,019 2,209,063 1,997,999 1,888,965 2,228,156 1817 2,960,794 1818 1,457,707 1819 2,474,738 1820 2,581,256 1821 2,676,274 1822 2,618,490 1823 2,842,676 1824 2,957,261 1825 2,655,959 1826 3,255,075 1827 3,021,191 1828 3,285,843 NET REVENUE (Customs.) £. 862,632 11 )l 908,954 17 4 1,074,903 16 5 1,012,538 12 1 1,316,502 14 3 1,031,492 4 2 949,961 16 1 1,225,213 7 5 1,299,744 7 1,794,990 15 9 2,321,935 16 5 1,835,112 11 1 2,782,232 18 1 2,210,801 6 U 1,551,457 17 11 2,458,124 18 3 2,439,795 1 10 3,097,590 3 6 3,150,753 6 3 4,177,916 3 4 3,273,995 2 3 3,117,330 12 9 3,339,218 4 3 3,939,939 17 2 3,447,560 4 5 3,276,513 6 5 2,957,403 2 4 3,166,851 18 3,967,154 5 (I 2,331,472 3 5 3,507,844 11 3,477,770 11 4 3,660,567 6 7 3,579,412 12 1 4,022,782 4 1 4,223,240 18 5 3,756,654 1 4,518,690 15 9 4,218,623 6 7 4.576.287 13 4 NO. II.] CUSTOMS AND EXCISE DUTIES. . . GREAT BRITAIN. British Plantation Sugar. Per Cut. £. s. d. 12 4 () 15 17 6 19 4 1 1 4 1 G 6 1 7 1 9 1 8 1 7 1 10 1 10 1 8 1 7 1 7 KATES of DUTY (Customs.) East India Sugar. Per Cut. £. s. d. 2 5 2 5 2 (1 2 6 3 2 6 4% 9 1| 9 8A Per cent, ad valorem £. s. d. 37 1G 3 37 16 3 37 16 3 40 16 3 42 16 3 42 16 3 1 4 1 6 6 1 7 H 1 10 1 1 12 1 1 11 1 1 10 1 1 13 1 Per Cwt. 1 10 1 11 1 19 1 10 1 17 1 19 2 1 17 1 17 2 1 18 1 17 1 17 Note. — From 5 July, 1825, Mauritius Sugar was placed on the same footing, with respect to Duty, as British Plan- tation Sugar, having been previously charged as of the East Indies. » Sugar used in the Distilleries included ill 1 llis.,. \c;irs. CUSTOMS AND EXCISE DUTIES. [ap. CU C3qj"^ q Oq; o cu p Ph :£ Ph £ Ch^Ch^ p< ij •0 '<3 **i u < '-3 »•» -3 ■»• '-3 o ^o 1-© i,© ,_, in . co £co » ^ So oC3i S C . Pi . &. • P< . Oh -° ".a «^ ja . -a >p . — - 0! -S Mi-O cu cm 3 cm 3 cm cu cm cuco Pi . Ph • . ft -ft .; . ft o P 0) Mill |co s| s-j-jo a^ a [* £ H co > co >co>co > «> 60 o u o i_ 5 -X. o — . o -— - o — - CD -P C-, .O .CM >% . CM -2 . a CM -^"s^^o ^^fl-M^a -m°p ^J =+! CO ^a" ■ • ,0. " ,£ • . ' £ ' £ o o 5 Si 60 ex S-iJa3-w •) t » j: cu*j Ph.SP, B & . g B< ,+j &, g co S co S co cj co -d «o « cm s &T s cJ" S cm S^ S cu ■ o cu a j5 o • S3 • O cu • o cd Ph cu ft cu ft cu ft cu ft f- X -h 1 5 1 1 1 1 1 ^ocij -1 c3g cci co« >H o cu — - o a; — - o cu — o cu T~ u u — - a) Ph 0) © u ^ ft CU fli ^ PuCM ,,_, Oh-M P,CM _~ P-CM cu CM 1 — ^ o Jr o ,_b oj^ojt o £* «+l oo P co £> cc Pec P co & .; co CU 2 » U hfi S o a Mill 1 • • 1 • • 1 • O in S'C H) OC1 i "8 oo -* © to in © ©1^ i—i © © CO©^t "° X *j "* ■* oo co no co in CO© ©©© CM ts. 00 Ct3 £ ° 00 OOOCOH 00 CM © CO i—i CM O0 CM t^ 00 i— i CO CM t^OW "* © CM ■ eo m in -* cm CO CM 00 © © © CM ©<© ©int>. t^cMoi c c ° 5 =5 CO co co o-i -rr t» ■* Ol DO COCO00 t^00J~» oiaiiMl' , t © ©CO co©iO CO •"* -T 1 s-;X ? iC CO © 00 CM CO CO ©co in©co cm oo co os | ■* Tf in io >n co oo 00 to Ol©© © i— i i—i HH rH rt ^ 1—1 ph i-H ph-hcsi CMCMCM ai © OhSM^ m cor^ oo©© i— i cm eo 00 © © © OS © © O© CTSOS©) ©©© J-^ t^ t-» t~» t^ t~» t^ t^t^ t^t^oo oooooo (w ; " H I-H I— 1 iH hH rt 1—1 NO. II.] CUSTOMS AND EXCISE DUTIES. XXIX "* \U d io — . to 60 Ph K3 ,g CN 6 to © s — hi 0) in © '-3 .£ ^ Pi h C: o 1 CO d ^ Ph i i i i l 1 1 1 1 1 ~ i 11(11111 1 -1 rx MM 1 1 1 1 1 1 ja I II 1 1 1 0) z ■a s u Ph © ■ © CN in CD — TJ id ^* o -^' CN (3^ C o rB 60 01 CD o < 5 o «! < .d • -*J h n CD "S CD Ph • CJ u hi 0> CN M Ph CD • S Ph "** 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 S 3 P u © 1 1 1 1 1 1 III CO* rt >H >-. aj o a> "a _^ P.CN si 1 o — d DO < O 6 -3 g al^ 1 ■8 © -2 | 1 I 1 1 I 1 1 1 1 1 | 3 C>X 1 1 1 1 1 1 1 1 1 1 1 i i i i 1 1 1 1 1 1 3 *" I II 1 1 1 1 II CM •3 g £ ■a © ^«§2 . CO — - -r ~ © oi 00 00 © 00 © 01 r^ »-»©•-<— 'T©©00 ■"* """ ~" *■* OS >-. ' ^ ^ ~~* "~~ — — i—i r— -H -* 00 00 rr © © -r co DD C EC © © © 00 CO © cm oi co in -»> co © © © © 01 "N tfO x ^T T3)O0CT- c In O °1, — -1 ~ •c--;|i-. X 01 i.O '^ CO in *£ — • © CM © OI © 00 CM — 00 o" ocTco © c' oi o5 / 00 © © CO CN to" / in ■* t^ © t^ -- co t^ -r CN © Tf t^ CO — -r o © — © co co co -r © ifS ©^ CO 04 -/. 00 © t~» © rC 01 CO 01 00 © cc -T M S N N QO Ol C lx CO © © - © © © © © - -MC 01 01 oi 01 CO CO CO -*■ 'O © © "- 71 01 — 1 01 01 CN — 01 01 01 01 OI *' CM CN Ol CN CM Ol 01 01 -r in co r-» x> © © — oj CO T ifi © r^ 00 © S — 01 ~0 T iO © t-- X © © - © _ 1 — — 01 01 01 01 01 01 01 01 00 00 OC X r_ r r x x 00 r v r x r 00 /■ X 00 00 00 00 00 00 00 CUSTOMS DUTIES AND EXCISE. [AP COFFEE Quantities NET REVENUE Years. retained for of Home Consumption. CUSTOMS and EXCISE. lbs. £. s. d. 1789 . . 930,141 46,286 17 11 1790 973,110 50,799 7 4 1791 1,047,276 57,659 5 11 1792 946,666 48,825 6 2 1793 1,070,438 67,357 11 9 1794 969,512 74,430 4 6 1793 1,054,588 65,788 3 7 1796 396,953 30,048 6 11 1797 637,001 92,469 3 11 1798 697,487 78,966 6 9 1799 682,432 74,001 2 2 1800 826,590 142,867 11 5 1801 750,861 106,074 2 7 1802 829,435 72,183 2 3 1803 905,532 72,093 15 8 1804 1,061,327 151,388 11 1805 1,201,736 120,172 18 7 1806 1,157,014 152,759 6 9 J 807 1,170,164 161,245 11 4 1808 1,069,691 229,738 16 8 1809 9,251,837 245,886 8 4 1810 5,308,096 175,567 1 4 1811 6,390,122 212,890 12 10 1812 8,118,734 255,184 7 1 1813 8,788,601 Customs' Records destroyed. 1814 6,324,267 213,513 18 4 1815 6,117,311 258,762 18 3 1816 7,557,471 290,834 11 1817 8,688,726 298,540 5 1 1818 7,967,857 250,106 4 10 ■ 1819 7,429,352 292,154 8 10 1820 6,896,286 340,223 6 7 1821 7,327,283 371,252 5 6 1822 7,404,204 374,596 19 7 1823 8,209,245 416,324 3 9 1824 7,993,040 407,544 4 3 1825 10,766,112 307,204 14 2 1826 12,724,139 324,667 11 1 1827 14,974,378 384,994 13 2 1828 16,522,423 425,389 3 7 NO. II.] CUSTOMS DUTIES AND KXCISE. . . GREAT BRITAIN. RATES OF DUTY. CUSTOMS. BritMi Plantation. per lb. s. d. H u H 4i 5" 53 6| 4 4 East India. per lb. s. d. 44 4| 4 41 f>% 4 4| 5i per cent. ad vol. £ s. d. Nil. 2 •_' 16 3 3 2 6 3 3 9 3 7 11 6 8 3 19 2 Nil Repealed from 5th July 1919. 6 9 Briti-h Plantation per lb. s. d. 6i 1 1 3 1 E a* t India. per lb. s. d. 1 8 1 6 6 1 6 Rep. from 5 April 1825. British Plantation. per lb. s. d. IDS 5* H H b\ 6 n H 7 1 - 7$ li 1 6 East India. per lb. s. d. 2 Oi 2_C^ 2 7 2 7 % ^_7| 2 7 2 7% 1 ll| 2 0.1 2 0^ 2 Of 10 10 10$ 111 1 6 per cent. ad val. £ s. d. Nil. 2 2 2 2 16 3 3 2 6 3 3 9 3 7 11 3 7 1 3 6 3 19 2 Nil. 11/ 8/. 6. AP. NO. II.] An Account of the QUANTITIES of GLASS which have paid the Duties of CUSTOMS and EXCISE for HOME CONSUMPTION, stating the Rate of Duty paid to the Customs and Excise, and the total of both ; also the total Net Amount of Revenue received in each year since the year 17S9. 1789 1790 1791 1792 1793 1794 1795 1796 1797 l.-'is 1799 1800 1801 1802 1803 1804 1805 1806 1807 1808 1809 1810 1811 1812 1813 1814 1815 1816 1817 1818 1819 1820 1821 1822 1823 1824 1825 1827 1828 QUANTITIES OF GLASS RETAINED Full HOME CONSUMPTION. 44.527 45.990 51.410 55.267 67.615 49.218 49.166 48.463 49.938 55.987 61.748 57.668 59.483 69.764 62.656 64.311 59.027 61.587 64.682 66.815 68.872 70.301 60.248 Flint. 28.902 32.503 34.903 25.959 27.827 33.948 33.314 29.437 28.717 28.892 31.443 .32.568 35.164 45.053 51.063 Plate. 10.542 9.139 7.021 3.641 3.426 7.647 7.555 8.822 9.761 9.661 11.776 13.564 15.168 Cwls. 24.194 21.302 21.924 22.214 21.519 20.607 21.694 26.254 25,971 20.621 19.690 19 874 19.381 20.948 16.626 12.741 16.701 16.224 10.855 12.145 11.151 9.170 9.646 7.010 7.013 8.609 8.453 6.140 8.374 8.319 8.250 7.782 8.036 8.353 9.172 9.300 8.386 7.C11 6.956 Germai 81.2S5 76.185 75.610 80.225 83.940 47.881 53.538 58.235 50.790 41.571 55.821 61.389 67.401 81.501 68.678 97.096 84.949 83.512 89.544 91.938 69.252 86.338 91.881 68.824 60.170 59.584 55.502 73.259 83.986 84.006 70.253 76.887 83.799 87.153 101.489 118,217 99.711 90.603 Bottle Cwls. 185.296 215.034 242.684 238.127 250 192 227.476 205 330 165.065 117.865 105.096 132.475 159.334 187.096 199.939 239.297 22.3.174 215.294 183.832 252.332 283.498 263.390 252872 253.983 260.664 159.217 139.746 160.175 155.595 113.095 200.011 235.975 167.208 133.550 149.754 184 672 229.134 248.616 218 0.33 224.864 Cuts. 1.114 1.270 1.871 1.858 1.642 2.593 3.327 2.081 1.640 1.313 1.867 2.235 2.775 2.850 2.402 1.927 2.556 1.561 131 149 203 294 271 277 307 Feet. 13.502 11.375 15.095 28.004 20.736 223 2.010 10.076 4.598 409 51 1.958 752 267 3.454 567 362 1.092 NET REVENUE £. s. 159.448 4 160.057 11 163.911 15 167.866 10 177.407 19 178.958 6 183.749 8 176.944 8 174.092 2 156.380 6 164.659 16 188.240 3 195.414 5 209.740 18 241.856 10 219.979 11 285.937 3 316.059 1 327.077 7 325.565 19 349.590 16 318.831 19 360.989 10 364.686 11 : 509.623 7 425.235 2 ] 408.820 3 325.963 14 419.886 7 548.309 10 558.216 16 " 469609 6 481.652 12 506.987 6 544.920 13 645.172 9 669.786 4 622.216 7 10 615.056 602.632 RATES OF DUTY. Per Doze Quarts. 4;o !6/0 6/7 7/0 to 12/0 per foot. 6/0 to 11/0 per foot. 11/. 4s. Sl.6s.Bd. 11/. 4s. 8/. 6s. 8tt. 6/. 6s. per cwt and 80/. per cen ad valorem. 4/. per cwt. and 20/. percent ad valorei P.r Cwt 21/5* 32/8 49/0 98/0 Per Cwt. Per Cut. Per Cut »m i6/ij Bottle 98/0 8/2 12/3 30/0 24/6 36/9 73/6 4/0i 28/0 42/0 '.'>'; 2/2f 63/0 126/0 6/64 Transf. to Custom: 5 April, 1825 II.] EXCISE ON SPIRITS. CJ HH ■« (n. to 00 -* - o to t^ £ BS CO t>- 00 — ■^ to to O 2 a CO -f -T 00 CO c^ < = > in CO in n in to in CO 00 - a ~ o co =3 ri "3 CM cj _2 O oo ^3 oj pj d a> r*\2 ■3 < o 3j ; £ O 1-* 2 H p. a : -3 O -2 O o a o o o TV. •S d -c H 72 rt 93 fi as a ' s & O a a ^4 — Q a ~ •" ' CO • J* oo &* CM CM w v v- ' =j g in CO 00 _^ BS 00 BS © 09 CO >n CM o in oo 05 00 - a -r iO In. CO o *>. "5 »— ° -. 35 CM o 00 CM to 3 ^ !s -I In. CO in 00 00 in £ O ~i O Cfl_ CO Cl °K tv^ tNj^ a. oT oT of •<* irT CO~ rf 1ft M • O co CN © in 00 , © *— ^ *2 GO tN. CO In. to to o -t< CM 3 ai O 3 00 00 o o CJS CO < ° > 00 to © Ol ^ en CM ~l in ■n£ «e in ©^ tN^ s « =4 cr nT ■* ■^ rf ~i irT fc © co 1^ 00 to Cl (35 05 In, CO 1^ co^ OS « CO a . - o a co S3 a z :=: 00 ^ ~ a s cu O £ "3 "7 jjfe .2 O 5 P" 5 M n. 0) u o 2o| •2 ,- tD B o 2 o o ^ 5 s n u 0) iS n ■~z o G *" fc< oi CN ■j o V) a i-n. in .n — < r 3b CO ■ i .. / o -r o © cq_ ifl CO »>. -r — Ob T cT rC - ~ ~~ -* CM -r — EC c^ ■^ CO 5 u: ■£ o, CO CO co^ °i r e !. 0> /5 g CM ~i CO to" -'■ CO / ©" ./ . C* CO -r in c tN. 00 tl -. i Ol o> C4 "I V / a / / 00 / 00 *" "* ^ - F "' - 1 XXXVI ARTICLES OF [AP. APPENDIX.— No. III. PROTECTING DUTIES. A LIST of ARTICLES of from Foreign competition, Foreign Manufactures : — Brass manufacture Copper ditto Cotton ditto Earthenware ditto Glass (crown) (German sheet) Hats (felt) (chip, cane) (straw) Japanned ware Iron (wrought) Lace Pewter Manufacture Steel ditto Tin ditto Tobacco manufactured Woollen ditto TABLE I. British Manufacture not exposed to injury and of the Duties now charged upon similar £ s. d- per cwt. do. 30 30 do. 10 do. 15 do. 8 6 8 do. 10 each Id 6 dozen, from £1 to 2 16 ditto 3 8 to 6 Hi per cent, do. 20 20 do. 30 do. 20 do. 20 do. 20 per lb. per cent. 15 9 f) TABLE II. A LIST of ARTICLES of British Manufacture, erroneously supposed to be liable to injury from Foreign competition, and of the Duties on similar Foreign Manufactures : — Books, being Editions printed prior to the Year 1801 ..... per cwt. 1 , printed since 1801 . . . . do. 5 , if first composed, or written or printed in. the United Kingdom, prohibited by 6 Geo. IV. c. 107. § 52 ; except Books not reprinted in the United Kingdom within twenty Years, and Books not for sale . . . Candles, Tallow Wax China Ware ...... Glass (plate) Gloves, Men's .... — . Women's . per cwt. per lb. per cent. . per foot, from 6s. to 3 15 3 2 11 4 6 per dozen pair do. 5 ) 40 NO. III.] Jewellery Leather Manufactures Linen ditto (on average) Paper (stained) . (waste or other) (made of old rope) Plate of Gold ' . of Silver Silk Manufacture Sugar (refined) Spirits Watches tllUTlSH MANUFACTURE 15. XXXVII £. «. d. per cent, do. 20 30 do. 40 per square yard per lb. do. 1 9 3 per oz. do. 3 16 4 9 6 per cent. 30 do. 8 8 per gallon, per cent. 1 2 25 6 TABLE III. A LIST of ARTICLES of British Manufact and of the Duties on similar Foreign Baskets . Blacking . . Boxes . . Brocade of Gold and Silver Buttons Cables . . . Candlewick Cards (playing) Casks (empty) Gunpowder . Corks (ready made) Embroidery and Needle-work Furs, dressed Haberdashery and Apparel Instruments of Science Music Matting Mattrasses Models Parchment Pasteboard Pencils Pens Sealing Wax Tiles . Manufactures of Hair or Goafs Wool, wholly or partly made up Ditto of Linen, made up Ditto of Cotton or Woollen All goods being in part or wholly manufactured, and not being described in the Schedule of the Customs Duty Act of G Geo. IV. C 111. ure, of minor importance, Manufactures : — per cent. per cwt. per cent. do. do. per cwt. do. per dozen packs per cent. per cwt. per lb. per cent. do. do. do. do. do. do. do. per dozen skins per cwt. per cent. do. do. do. do. do. do. do. 20 3 12 20 30 20 10 4 s 8 4 50 3 3 7 30 75 20 20 20 20 (1 20 9 5 (1 10 3 8 ■2 30 30 (1 30 15 (1 30 40 1) 20 20 BRITISH MANUFACTURE. [NO. III. TABLE IV. A LIST of ARTICLES, being of English pared Materials for other Manufactures ; Foreign Manufactures. Aquafortis Copperas, White . Cordage Glue Hemp, dressed Hides, tanned Ink, Printers' Mercury, prepared Mill Boards Platting of Bast, Chip, Cane, or Horse H Ditto of Straw Pots of Stone Skins (Calf), tanned (Sheep), ditto (Kid), ditto Soap, Hard , Soft Thread . Thrown Silk Twine Varnish Verjuice . Verdigris . Vinegar, or Acetous Acid Wire, Brass, or Copper Ditto, gilt or plated , Manufacture, serving as pre- and of the Duties on similar £. *. d. per cwt. 14 3 do. 12 do. 10 9 do. 12 do. 4 15 per lh. 1 per cwt. 1 1 I) per cent. 30 per cwt. 3 8 2 per lb. 1 do. 17 per cent. 30 per lb. 1 Q per 100 skins. 2 do. 15 per cwt. 4 13 do. 3 11 3 the dozen lbs. 15 per lb. 7 6 per cwt. 1 11 per cent. 30 per ton. 73 12 9 per lb. 2 per ton. 18 18 per cwt. 2 10 do. 25 APPENDIX.— No. IV. AN ACCOUNT of the EXPENDITURE during the WARS of 1793 AND 1803, EXCLUSIVE OF THE INTEREST ON THE DEBT CONTRACTED SUBSEQUENT TO 1792, AND OF THE REVENUE TAID INTO THE EXCHEQUER. CHARGE ON THE [at. An Account of the TOTAL CHARGE on the UNREDEEMED Sinking Fund, and exclusive of the Charge upon all Loans raised since ary in each subsequent year to the 5th January, 1816, making deduc- Expenditure in the Year ending 5th January, 1793, and in each sub- on the Debt due the 5th January, 1793, and of the Charge for any January, 1793 : — also, The Total Net Revenue paid into the Exchequer showing the Excess, if any, of the Expenditure, or the Excess, if any, diture over Revenue. Years ending 5th January 1. 2. 3. Charge Of the Unredeemed Fund- ed Debt, and on the Un- funded Debt, (exclusive of Sinking Fund, and ex- clusive of the Charge upon all Loans raised since 1792,) as it stood on 5th Jan. 1793, and on the 5th Jan. in ea< - h sub- sequent Year to 5th Jan. 1816, making deductions for the Annuities that Total Public Expenditure in the Year ending 5th Jan. 1793, and in each subsequent Year to the 5th Jan. 1816, exclusive of the Sinking Fund on the Debt due on the 5th Jan. 1793, and of the Charge of any Debt, Funded or Unfunded, that was contracted subsequent to the 5th Jan. 1793. Total Columns No. 1. and No. 2. fell in in that Period. £. s. d. £. s. d. £. s. d. 1793 9,624,088 8 5J 7,670,108 5 2 17,294,196 13 n 1794 9,623,441 5 8f 14,759,206 15 "* 24,382,648 1 H 1795 9,622,237 8 2 19,702,489 2 H£ 29,324,726 11 H 1796 9,620,466 3 1 34,300,764 17 4 43,921,231 5 1797 9,618,550 15 45,814,275 8 Hf 55,432,826 3 H| 1798 9,614,818 10 Hi 36,202,873 13 Hi 45,817,692 4 11 1799 9,613,055 15 A\ 33,279,071 18 51 42,892,127 13 10£ 1800 9,611,668 10 8f 38,166,697 19 7* 47,778,366 10 H 1801 9,609,884 13 5 39,074,449 13 Hi 48,684,334 7 4 1802 9,607,659 8 40,690,486 9 6£ 50,298,145 10 2| 1803 9,606,509 16 8 29,610,471 2 3i 39,216,980 18 Hi 1804 9,581,270 13 If 28,289,364 9 0i 37,870,635 2 2 1805 9,580,272 3 li 37,876,084 9 4§ 47,456,356 12 6 1806 9,548,920 6 3£ 44,765,873 10f 54,314,793 7 2 1807 9,538,508 1 7£ 45,485,499 7 55,024,007 8 n 1808 9,524,724 1 5£ 43,970,956 9 8 53,495,680 11 1* 1809 9,104,238 8 7 49,821,335 7 58,925,573 15 7 1810 9,103,379 7 3 52,274,730 5 o* 61,378,109 12 1811 9,102,580 17 2± 52,551,395 4 3* 61,653,976 1 6 1812 9,101,931 10 Hi 58,646,377 8 H 67,748,308 19 2| 1813 9,101,399 7 7i 60,604,064 7 7i *2 69,705.463 15 3 1814 9,100,154 8 1 77,406,919 8 6 86,507,073 16 7 1815 9,098,917 16 4£ 76,227,766 18 10 85,326,684 15 H 1816 9,098,046 6 10| 60,559,275 15 11* 69,657,322 2 9f 226,356,723 16 8f 1,027,750,537 19 9 1,254,107,261 16 H Whiteh all, Treasury Chambers > 5th May, 1828. < ^IEO. R. DAWSON. NO. IV.] FUNDED AND UNFUNDED DEBTS. FUNDED DEBT, and on the UNFUNDED DEBT, (exclusive of 1792,) as it stood on the the 5th January, 1 793, and on the 5th Janu- tions for Annuities that fell in, in that period: — The Total Public sequent Year to the 5th January J 816, exclusive of the Sinking: Fund Debt, Funded or Unfunded, that was contracted subsequent to the 5th in the year 1793, and in each subsequent year to 5th January, 1816 ; of Revenue over the Expenditure, together with the Total of Expen- 4. 5. 6. TOTAL The EXCESS, The EXCESS, Net Revenue if any. if any. paid into the Exchequer of Expenditure, of Revenue, in the Year in Column in Column 1793, 3. 4. and in each subsequent over the Revenue over the Expenditure Year to in Column in Column 5th January, 1816. 4. 3. £. s. d. £. s. d. £. s. d, 19,258,814 6 4} . 1,964,617 12 9 19,845,705 10 4 4,536,942 11 4\ 20,193,074 4 6| 9,131,652 6 7 19,883,520 13 0| 24,037,710 7 4J 21,454,728 4 b\ 33,978,097 19 6£ 23,126,940 7 1 22,690,751 17 10 * 31,035,363 2 4\ 11,856,764 11 6 35,602,444 8 114, 12,175,922 1 5 34,145,584 4 1 14,538,750 3 3| 34,113,146 18 4} 16,184,998 11 10 36,368,149 14 5 2,848,831 4 6J 38,609,392 8 6 . 738,757 6 4 46,176,492 19 8 1,279,863 12 10 50,897,706 5 10£ 3,417,087 1 3| 55,796,086 8 2 . 772,078 19 63 59,339,321 19 4\ . 6,843,641 8 2| 62,498,191 9 7f . • 3,572,617 14 0a 63,719,400 18 11 . 2,341,291 6 7i 67,144,542 18 4\ . 5,490,566 16 lo| 65,173,545 12 8| 2,574,763 6 6 65,037,850 1 7 4,667,613 13 8 68,748,363 6 3 17,758,710 10 4 71,134,503 2 24 14,192,181 12 lla 72,210,512 15 7i • 2,553,090 12 9$ 1,081,513,382 10 195,870,641 12 104; 23,276,761 17 2£ 23,276,761 17 2* Deduct Excess of Re-1 venue . . .] Excess of Expenditure 1 over Revenue . j 172,593,879 15 7\ XL11 [AP. No. V. National Debt Office, 1 1th April, 1828. RETURN to an Order of the Honourable the Select Committee of the House of Commons on Finance ; requiring Answers to the following Questions : — QUESTION. First. — If three per cent. Stock should be at such prices as to yield Interest at the rate of three and a half and four per cent, respectively ; and if the sum of One Million a-year were applied in converting three per cent. Stock into Annuities for 35, 40, 45, 50, 55, 60, 65, 70, 75, 80, 85, and 90 years, how much Stock could be so converted, supposing tho said sum of One Million to be divided into twelve equal parts, and each part into one of the before-mentioned Annuities ? ANSWER: When the interest of money, payable half-yearly, is at the rate of 3^ per cent. 4 per cent. The Annuity for 35 years should bo converted for Stock . £6,578,578 8,332,106 40 . 8,351,089 10,765,109 45 . 10,459,391 13,730,925 50 . 12,967,100 17,346,239 55 . 15,949,881 21,753,287 60 . 19,497,733 27,125,453 65 . 23,717,705 33,674,094 70 . 28,737,046 41,656,850 75 . 34,707,455 41,387,786 80 . 41,808,823 63,249,744 85 . 50,255,510 77,709,403 90 . 60,302,377 £313,332,688 95,335,644 £462,066,640 QUESTION 1: Second, — How large an amount of three per cent. Stock ought to be converted into a terminable Annuity of 30, 40, or 50 years, on payment of a bonus of One Million Sterling, when Stocks are at such prices as to yield interest at the rate of 3, 4, and 5 per cent, respectively ? ANSWER : When the Annuity terminates in And when the Stocks yield interest at the 30 years. 40 years, rate of 3 per cent. 1 The said Bonus should afford f £2,443,220 £3,290,663 4 per cent. > a conversion of the adjoin-S 4,374,708 6,500,586 5 per cent. J ing capitals in 3 per cents. *- 7,332,983 12,015,946 50 years. £4,432,046 9,659,528 19,689,527 J. FlNI.AYSON, Actuary of the National Debt. London ; Printed by William Clowes, Stamford-Street. Lately Published — Second Edition, OBSERVATIONS ON PAPER-MONEY, BANKING, AND OVERTRADING. Bv Sir HENRY PARNELL, Bart. BOOKS II HUSHED BY Mr. MURRAY, ALBEMARLE-STREET. I. — In the Press, 3 vols., 8vo. The LAW of POPULATION : a Treatise, in Six Books, in disproof of. the Superi ' Hum an Beings ; and developing the real PKtNciPt^ of their i. urease. To which is added, a Dissertation on the Balance of tue Food and Numbers of Animated Nature. By MICHAEL THOMAS SADLER, M.P., Author of "Ireland; its Evils and their Reme- dies." II.— Lately Published, 8vo., 12s. A NEW EDITION of IRELAND ; its EVILS and their REMEDIES. III.— 8vo., 3s. 6d. THREE LECTURES on the COST of obtaining MO- MEY, and on some Effects of PRIVATE and GOVERNMENT PAPER MONEY. Delivered before the University of Oxford, in Trinity Term, 1829. By NASSAU WILLIAM SENIOR, A.M., late Fellow of Mag. Col., Prof, of Political Economy. IV In the Press, 2 vols., 8vo. The PROGRESS of SOCIETY. Contents: General Principles. — 1. Of Human Welfare. — 2. Sketch of the Progress of Society. 3. Of Wealth and Industry.— 4. Of Rewards for Inventions. — 5. Of Capi- tal. 6. Of Money.— 7. Of Value and Price 8. Component Parts of Value. 9. Of Rent 10. Of Tithes. — 11. Distribution of Wealth — 12. Equali- zation of Wealth. — 13. Of Property. — 14. Education of the Lower Ranks. 15. Effect of Numbers on a State. — 16. On Commerce. — 17. On Popu- lation. — 18. Artificial State of Society. — 19. Paper Currency — 20. Corn Trade.- Concluding Observations. By the late ROBERT HAMILTON, LL.D., F.R.S.E., Professor of Mathematics in the Marischal College and University of Aberdeen ; Author of "An Inquiry concerning the National Debt." Dr. Hamilton had been engaged for many years in writing this Work, and con- tinued to revise and improve it until within a few days of his death. V. — Lately Published, 2 vols., 8vo. With Engravings, 30s. COLLOQUIES on the PROGRESS and PROSPECTS of SOCIETY. By ROBERT SOUTHEY. " These volumes will supply considerable entertainment to every order of think- ers, who like to have their faculties called into exercise by power and accomplish- ments of no common description, however singularly exhibited. To a fine display of copious and commanding eloquence, supported by much felicity of expression, and adorned by most of the graces which attend on practised composition, is united a variety of illustration and allusion, which a reading experience of Dr. Southey's could alone supply. — His books are worth reading, and should be read accordingly." — Westminster Review, No. 21. " This is a beautiful book, full of wisdom and devotion — of poetry and feeling; conceived altogether in the spirit of other times, such as the wise men of our own day may scoff at, but such as Evelyn, or Izaak Walton, or Herbert, would have delighted to honour."— Quarterly Review. VI.— Just Published, 8vo;, 2s. 6d. An EXAMINATION of the CURRENCY QUESTION, and of the Project for altering the Standard of Value. ™" " OF ILUNOIS-UH^NA * 0112 062406902