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ed in grofs mifrepresentation of the truth, in fhameful attempts to conceal what ought to be known to the houfe. In this fummary it was contended, however, that the difficulties of the bank were owing in fome degree to a scarcity of circulating medium. Hence it was denied that bills of exchange were applicable to the purpose of circulation. He referred to Mr. Thornton's evidence upon the fubject in page 71 of the report, who ftates his opinion nearly as follows, "I conceive that the number of bills of exchange, which may happen at any time to exift, bears no neceffary proportion to the magnitude of the exifting trade; although I conceive that the ufe of them in payment does bear a pretty regular proportion to the quantity of commerce. For instance, at Liverpool and Manchef ter all payments are made either in coin or bills of exchange." His grace faid, if they bore a regular proportion to the quantity of commerce, he could hardly agree in the opinion advanced in the paper annexed to the report, that they were not a part of the circulation of the kingdom. He came now to a fubject of a much more ferious nature. As it was ftated that this paper contained facts, but which were not warranted by the evidence given before the committee,, nor introduced into the report, he was at a lofs how to account for the grofs mis-statement which he was about to mention. In page 252, they found that all the remittances made for the fervices of the war, into different diftant parts during the last four years, amounted to 33,510,7791. diftinguished from thofe expended in other parts during the faid four years, including the imperial loan; and the ad

vances made to the emperor a mounted to 14,988,4221.; and lastly, that the fums paid for all forts of military fervices on the continent, during the war ending in 1763, amounted to 20,626,9971. His grace remarked upon this statement, that if the authors of the report meant to compare the expences of the prefent war on the conti nent with thofe of the war ending in 1763, the number of years ought to have been marked; and then it would be found that there had been expended in four years of the prefent war almoft twice as much as in eight years of the former. He begged their lordships to remark, that, in the account of the continental expences during the prefent war, the fums advanced to the emperor are faid to be included. It appeared, however, that the account was accurate only by leaving out the word "including the imperial loan and the advances made to the emperor." Thefe fums appeared in the title, but were excluded from the body of the account, fo that there was an error in the total fum of 5,500,000l. For an error so grofs, he knew not how to account; however, he would leave it to their lordships to decide whether the error originated in intention or ignorance, but to one or the other it must be imputed. His grace next dwelt at fome length on our exparts and imports, upon which great firefs had been laid by the committee. He reminded their lordships, that in the last years of the American war the exports above the imports were averaged at 6,000,000l. He found that the additional expence of naval ftores, which certainly was confiderably increased in time of war, is ftated as having rendered the balance of commerce lefs favourable; but this

circum

circumftance ought to have been mentioned on the other fide of the account, as increafing our exports over our imports. In the fummary before their lordships, he was furprised to find one material thing omitted, viz. the refult of the correfpondence which took place between the chancellor of the exchequer and the directors of the bank, relative to making remittances to foreign powers. His grace made feveral remarks on the reprefentation of Mr. Ellifon, in afcribing the stoppage of the Newcastle banks to a local alarm; but, in his opinion, that fhock had been produced not by alarms, but by a combination of different caufes. Upon this part of the subject, he regretted that fome papers containing different ftatements of cafh in the bank at different periods, which were laid before the committee, had not been published in the report, and more especially as he could have fhewn from them, that the statements contained in the report were falfe. His grace next made fome obfervations upon the evidence of Mr. Boyd and Mr. Thornton, whofe opinions were that the difficulties which the commercial world had experienced, and the fhock which public credit had fuftained, arofe from the bank not extending their discounts; but to these theories he oppofed the fentiments of Mr. Adam Smith. His grace next obferved, that the reduction of the paper in circulation amounted to only one eighth, from the quantity afloat in 1795. But, fuppofing that the decrease had been greater, he could not conceive how a decrease of notes could produce a decrease of cafh; though he could ily perceive that a decreafe of cath might produce a decrease of hotes. After making fome obfer

vations upon this fubject, he pro ceeded to state the fubftance of the refolutions which he meant to propofe, founded upon the correspondence which had taken place between the bank-directors and the chancellor of the exchequer. His grace went through the different parts of the correfpondence, and adverted to the refolution of the court of directors, of the 11th of February, 1796, and Mr. Pitt's anfwer to it, in which he promises neither to make any further loan or advance to the emperor, without previously confulting the bank; while at the very moment he was fending money to his imperial majefty. After dwelling upon this fubject for fome length, his grace concluded in a very eloquent appeal to their lordships; reprobating the conduct of administration in the most severe and pointed language, whom he defcribed as the defpoilers of our fortunes! oppreff ors of the poor! and plunderers of the rich! He then moved the first of the following refolutions:

1. That it appears to this houfe that fubfequent to the month of June, 1795, and during the year 1796, a great diminution was experienced in the fpecie of the bank of England.

2. That it appears to this house, that the governor and deputy governor of the bank did at va rious times represent to the chan. cellor of the exchequer the danger to the bank from the diminution of its fpecie, particularly at the following periods :

11th of December, 1794; 10th of October, 179 23d of October, 1795 18th of November, 1796 3d December, 1794 15th and 16th of January, 1796; 28th of Janua ry, 1796; 5th and 8th of February, 1796; 11th of February, 1797

8th, 10th, and 21ft of February, $797

3. That it appears that during thefe periods the directors of the bank frequently remonftrated with the chancellor of the exchequer, on the magnitude of their advances to government, anxioufly requiring payment, or a confiderable reduction of the fame; but that, nevertheless, the chancellor of the exchequer not only neglected to comply with the object of those remonftrances, but, usually under pretence of the neceffity of the public fervice, renewed his demands for further aid; and that, under the exigency of the cafe, as ftated to them by the chancellor of the exchequer, the directors of the bank were from time to time induced to confent to further accommodation.

4. That it appears that the chancellor of the exchequer frequently folicited fuch further accommodation, in the most anxious and preff ing terms; declaring, that it was impoffible to avoid the most ferious embarralliment to the public fervice, unless the directors of the bank afforded the affiftance he required.

5. That it appears, that, although by these means the directors of the bank were induced to comply with his demands, they generally expreff ed their reluctance in ftrong language; and that they at laft, that is to lay on the 28th of July, 1796, thought it neceffary for their own juftification, to requeft the chancellor of the exchequer to lay before his majefty's cabinet their most ferious and folemn remonftrance; in which they declare that, "fenfible of the alarming and dangerous ftate of public credit, nothing could induce them to comply with the demand then made upon them, but

the dread that their refufal might be productive of a greater evil."

6. That it appears, that during the above period a confiderable portion of the bank advances was occafioned by payments of bills of exchange drawn on the treafury from abroad.

7. That it appears that it had fel, dom been the custom of the bank of England to advance, on the ac count of fuch bills, more than from 20,000l. to 30,000l. and that even during the American war fuch bills never exceeded at any one time the fum of 150,000l.; the wifdom of our ancestors having' foreseen, and provided against, the mifchief of fimilar advances by a claufe in an a&t pafled in the fifth year of William and Mary, by which the governor and company of the bank of England were reftrained from advancing any fums of money, other than on fuch funds on which a credit is granted by parliament.

8. That it appears, that from and after the year 1793, at which time an act of parliament palled, containing a claufe by which the directors of the bank are indemnified for the advances they had made out of the bills drawn from abroad, and exempted in future from the penalties of the faid act of William and Mary, refpecting fuch advances to government, the amount of treasury bills paid at the bank continued progreffively to increafe; and that between the 1ft of Janua ry, 1795, and the 25th of February, 1797, fums to the amount of up wards of 15,000,000l. were at dife ferent periods advanced to government upon this head.

9. That it appears, that the directors of the bank did, at various times, during the years 1795, 1796, and 1797, apply to the chancellor

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of the exchequer for re-payment of fuch advances, and reprefented to him the ruinous confequences to themfelves and to the public, of Continuing the fyftem of making treafury-bills payable at the bank; and that they even declared they conceived it to be "an unconstitutional mode of raising money, and what they were not warranted by their charter to confent to."

10. That it appears, that the chancellor of the exchequer did, at various times, in that period, undertake to reduce the advances on that head within the fum of 500,000l. and likewife fo to arrange his payments as to put an end to the account; but that, nevertheless, the faid promises never were kept by him, and that the advances on treafury-bills, on the 28th February, 1797, amounted to 1,619,049).

11. That it appears to this houfe, that foreign remittances to a much larger amount than ever were known in the most expensive wars in which this country has been involved, have taken place fince the year 1793.

12. That the extent of fuch remittances occafioned at fo early a period as the end of the year 1794, and the beginning of the year 1795, great alarmis in the minds of the directors, which they had at various periods communicated to the chancellor of the exchequer; and that on the 3d December, 1795, the court of directors, under the apprehenfion that it was intended to grant a further loan to the emperor, came to a refolution by which they declare their unanimous opinion, that, should fuch a loan take place, it would be "moft fatal in its confequences to the bank of England." That they communicated fuch re

folution to the chancellor of the exchequer, who affured them “ be fhould lay afide all thoughts of it, unless the situation of things relative to the bank fhould fo alter as to render fuch a loan of no importance or inconvenience to them."

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13. That on the 5th of February, 1796, the chancellor of the exchequer, after ftating, in conversation with the governor and deputation from the bank of England, his opinion of the neceffity of further affifting the emperor, promifed to take no ftep in that business without previously communicating

to them his intention.

14. That on the 11th of Februa ry, 1796, the directors of the bank paffed unanimously the following refolutions :

"Refolved, That it is the opinion of this court, founded upon the experience of the effects of the late imperial loan, that, if any further loan or advance of money to the emperor, or to any other foreign ftate, fhould in the prefent ftate of affairs take place, it will in all probability prove fatal to the bank of England.

The court of directors, therefore, do moft earnestly deprecate the adoption of any fuch measure, and they folemnly proteft against any responsibility for the calamitous confequences that may follow thereupon."

To which refolution, when com municated to him, the chancellor of the exchequer returned for anfwer, "That, after the repeated intimation which he had given to the governor, &c. of the bank, that no further loan to the emperor would be refolved on without previous communication with the bank, he did not fee any reafon for these refolutions; that he did fup.

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pofe they were adopted in a moment of alarm, and that he thould confider them in that light.”

15. That, both from the general tenor of the faid aofwer, and from its particular reference to the fub stance and matter of the refolutions then communicated to him, he gave the governors, &c. of the bank to understand that he was bound by promife to them to negotiate no loan for the fervice of his imperial majefty, nor to make any remit tance either to his faid imperial majefty, or any foreign prince, under any pretence whatfoever, without previously communicating fuch his intention to the bank of England; that the directors fo understood him, and that, impreffed with that belief, they abftained from making any further remonftrance on this fubject.

16. That nevertheless the chancellor of the exchequer for fome time prior to February 11, 1796, clandeftinely remitted, and did for feveral months fubfequent clandeftinely remit, his faid imperial majefty, and other foreign princes, large fums of money, in defiance of his repeated promises, and in violation of his folemnn engagement with the bank of England, and confequent upon their refolution of the 11th of February.

17. That it appears, that if the faid advances of the bank to government had been paid off when required, or confiderably reduced, the bank would have been enabled to reduce, if expedient, the amount of its outstanding notes; and that fuch option would have been of effential service to its interefts.

18. That it appears from the evidence of the governor and deputy governor of the bank, that if the faid advances had been paid off when required, or confiderably re

1797.

duced, the bank would have been enabled to give more extended aid to the mercantile intereft of Great Britain in the way of discount.

19. That it appears that if the advances on treafury bills had been paid off when required, and as the chancellor of the exchequer had promifed, and the foreign remittances abftained from, as the chancellor of the exchequer had likewife promifed, there would have exifted no neceffity for fufpending the due and ordinary courfe of the bank payments in cafb.

20. That it appears to this house, upon an attentive examination of the evidence reported by the fecret committee, upon a minute perufal of the correfpondence between the governor and directors of the bank of England and the chancellor of the exchequer, during the years. 1795, 1796, and 1797; and after a thorough review of the whole circumstances of the cafe, that the neglect of the chancellor of the exchequer in difcharging or fufficiently diminishing the amount of the fums advanced to government by the bank of England, uis perfeverance in directing treasury bills of exchange, to an amount unexampled, to be paid at the bank, his frequent promifes and conilant breach of those promifes to reduce their amount within the fun of 500,000l. and that the enormous amount of his remittances to foreign princes in loans and fubfidies, were the principal and leading caufes which produced the neceffity forthe order of council on the 26th of February laft.

The earl of Liverpool faid, that the fubject upon which he was now to address their lordthins, was attended with difficulty. He hoped, however, to be able to fatisfy them, that they ought not agree to the reK folutions

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