country bankers for the ufes before It appears by the evidence of Mr. Thornton, that there was, at this time, also a demand of cafh to be fent from the metropolis to Scotland. But those demands for cafh, from the diftant parts of the kingdom, were not the only caufes of the embarraffments of the Bank of England at this period. It is ftated in an account delivered by Mr. Puget, one of the Directors of the Bank of England, and agent for the Bank of Ireland, that in the commencement of the year 1797 there was an unusual demand of cath made on the Bank of England to be fent to Ireland; and that there was an expectation of a loan intended to be raised in Great Britain, for the fervice of Ireland, which would neceffarily have occafioned the exportation of a confiderable quantity of coin from the metropolis to the latter kingdom. It is proper to add, that the kingdom of Ireland appears, for fome weeks previous to the iffuing the Order of Council of the 26th of February, to have experienced a great want of cafh, fimilar to that which was experienced in Great Britain. There is a circumftance that throws confiderable light on one at leaft of the principal caufes which produced this great demand for cafh on the bank. It appears by the account of the state of the cafh at the Bank at different periods, as laid before the Committee, that the greatest drain of cafh which the Bank has experienced, fubfequent to the year 1783, was in March and June 1793, that is, a fhort time af ter the failure of the country banks in that year; and in the commencement of the month of February of the Newcastle bank stopped paythis year, that is a fhort time after ment in cafh, and when the alarms before ftated produced great demands for cafh from different parts thofe periods, the fame caufe apof the country: So that, in both pears to have produced an effect nearly fimilar, that is, a very unufual drain of cafh from the Bank. must bear a proportion to the deThe increased demand for cafh creafe of any other fort of circulation that is a fubftitute for it. The Committee will prefently fhew to what degree the circulation of the notes of the Bank of England had been diminished, immediately previous to the 26th February laft. With refpect to the decrease of country bank bills in circulation, Mr. Thornton, who appears to have collected his evidence from several parts of the kingdom with great accuracy, was defired by the Committee to deliver in an account of the proportion in which, according to his information, country bank bills circulated in different parts of the kingdom before the failures in 1793; at a period fubfequent to that year; and at the prefent time. in the evidence; but the refult is, This account may be seen at large that at the prefent time the circulation of thefe bills is in one part of the kingdom not more than about a third; in another, not more than half; and in a third, but a fixth of what was in circulation before the year 1793: and the Committee have already endeavoured to thew, in a former part of this fummary, to what degree the means of coining, and, in confequence thereof, the 11,000,000l. regular fupply of new coin (which exceeding, to any great amount, It will appear, by one of the aforementioned accounts, that in the latter end of the year 1796, and in the beginning of 1797, the amount of bank notes in circulation was lefs than the average before ftated; and on the 25th of February laft it was reduced to 8,640,2501. the Directors alone could fill up the void occafi- The Directors of the Bank, under the impreffion which these alarms and embarraffments had occafioned, appear to have judged it prudent to diminish their notes in circulation, and the confequent demands that might come upon them, fo as to make the demands more nearly correfpond with the state of their cafh. It will be feen, in the accounts prefented to the Committee, of the amount of bank notes in circulation at different periods, that the average amount of these notes in circulation, for several years previous to the end of the year 1796, may be ftated at between 10,000,000l. and 11,000,000l. hardly ever falling below 9,000,000l. and not often It is true, that in an account prefented to the Committee, of the amount of bank notes in circulation in the years 1782, 1783, and 1784, the quantity was then generally even lefs than the fum last mentioned; but at that time the foreign commerce of the kingdom was not even one half of what it is at prefent, as will be seen in the account of imports and exports inferted in this report. It is not probable that the reduction of bank notes to 8,640,2501. immediately previous to the iffuing the Order in Council of the 26th of February, was owing to any diminution of the demands for them; for at that time the merchants of London were fubject to difficulties, from not being able to get their bills difcounted. The Directors of the Bank had, on the 31st of December 1795, come to a refolution to diminish their discounts; but notwithstanding that refolution, they did not diminifh the amount of their dif counts in the courfe of the year 1796, compared with what they were in 1785, but had rather increafed them; not, however, to fuch an extent as to make them correfpond with the wants of the commercial world. A confiderable degree of diftrefs confequently enfued; which diftrefs may alfo be imputed to another caufe in evi dence dence before the Committee. By law, no man is to take more than 51. per cent. intereft for money lent or advanced by him; and this reftriction is understood to apply to bankers in the business of difcounting; fo that in time of war, when a much greater intereft than 51. per cent. can be made of money, upon government fecurities, the difcounts which merchants obtain from bankers and other individuals, are neceffarily much diminished, and they are forced, on that account, to refort directly to the Bank. Some of the perfons whom the Committee examined on this part of the fubject, have expreffed a ftrong opinion of the inconvenience produced by the conduct of the Bank in diminishing their notes in circulation, and in reftricting their discounts. One of these perfons is of opinion that an increafed quantity of bank notes, proportioned to the increased occafion for them, must tend to prevent a demand for guineas rather than to promote it; and that if the quantity of notes iffued is very confiderably lefs than the occafions of the mercantile world require, a run upon the Bank will be the confequence. He is of opinion alfo, that the Directors of the Bank do not avail themfelves of the full extent of their credit; and that the caution neceffary to be obferved by private bankers in the amount of their bills, does not apply to the cafe of the Bank of England, for feveral reasons which he affigns. A great quantity of bank notes, in his opinion, is abfolutely neceffary for the circulation of the metropolis; and that in this refpect it is immaterial whether thefe notes are iffued for advances made to government, or in difcounts to private perfons; except, that in the laft cafe, thofe whofe bills are difcounted to a greater extent, may suppose that more relief is granted to them. He' allows, however, that as the Bank difcounts, even in time of war, at 51. per cent. there may be a greater difpofition to borrow of the Bank at 51. per cent. than it may be prudent always for the Bank to comply with. Another of thofe gentlemen is of opinion, that the refolution of the Bank to reftrict their discounts, excited an alarm and diftruft that led to an increase of the drain of their cafh; that it has contributed alfo to the forced fale and depreciation of public fecurities, and to other embarraffinents occafioned by an infufficient fupply of bank notes and cafh; which fupply has not kept pace with the deinand arifing from the employment and circulation of active capital, particularly for the laft fifteen months: And he alfo is of opinion that it would not fignify materially to the public, whether the quantum of bank notes introduced into circulation was created by difcounting bills for the merchants, or by advances to government. The Committee have judged it right to ftate the caufes affigned by thefe gentlemen, of the diftrefs that has lately prevailed from the want of futficient means of circulation in commercial transactions. The Committee, however, do not mean to decide whether the Bank Direc fors might not have folid reafons for their conduct in this respect, or to convey any opinion on this doubtful and delicate queftion; but conceive it their duty to call the attention of the Houfe to a point of fo great importance, and refer the House to the the arguments ftated more at large in the evidence. The Committee have thus gone through the chief points which have occurred in their enquiry refpecting the caufes which produced the Order in Council of the 26th of February laft, as refulting from the evidence taken by them, and the accounts laid before them. They fubmit the fame to the confideration of the Houfe; but as the minutes of their proceedings are inferted in the former part of this report, and as the Houfe is thereby poffeffed of the evidence on the whole of this fubject, in great detail, the inembers of it will be enabled to supply any omiffions, and to correct any defects which may be found in this fummary. The Committee being defirous of confining themfelves to thofe matters on which they have thought proper to call evidence, and fentible of the difficulty (even at all times) of appreciating the extent and influence of alarm, forbear from adverting to the effects produced upon the ftate of pecuniary tranfactions and circulation, by the apprehenfions of invafion generally prevalent towards the clofe of the last year, and in the beginning of the prefent, but of which the operations must doubtlefs have been confiderable. Nor will they attempt to eftimate how far the interruption given to the banking operations of many great commercial cities, by the troubles and calamities which have agitated Europe, and the entire ruin of many commercial houfes and establifhments, may have tended to derange the accustomed courfe and confidence of general circulation. The Committee think it fufficient merely to enumerate the con fiderations of fuch general notoriety, An Account of all Bills drawn on the Treafury from the island of St. Domingo, from the Commencement of the War to the latest period fuch an account can be made out. Amount of bills drawn from or on account of the island of St. Domingo, prefented at the Treafury in the years 1794 1795 1796 L. 4,383,596 8 2 and 1797 to Ift of May. CHARLES LONG. Treafury Chambers, A return of the deaths and cafualties which have taken place in the British forces, and in the forces in British pay, ferving in the island of St. Domingo, from the commencement of the war to the Soth of September, 1796, as far as the fame can be made up. British Forces. Dead, Dead 7,530 333 Forces in British Pay. Difcharged, and Deferted, N. B. Few of the returns of the foreign corps diftinguish the deaths from the other cafualties. War Office, W. WINDHAM. An An ACCOUNT of all Additions which have been made to the Annual Charge of the Public Debt by the Intereft or Annuities of any Loan that hath been made, or Annuities created, fubfequent to the ift of January 1793: And alfo the Produce of the feveral Duties granted for defraying the Charge in refpect of the fame in the Year ended the 5th of January 1797. Additional Charge created in reffect of 4,500,000l. borrowed anno 1793. Annual Intereft. Charges of Manage-to the account of the On respond 11'000'000r to est bank annuities Cn 6,250,000l. additional capital, in three per cent. confolidated Total additional charge created anno 1793 Produce of the duties for defraying the additional charge, created anno 1793 Deficiency in the year ended 5th January 1797 |