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6th, 10th, and 21st of February, 1797.

3. That it appears that during these periods the directors of the bank frequently remonstrated with the chancellor of the exchequer, on the magnitude of their advances to government, anxiously requiring payment, or a considerable reduc tion of the same; but that, nevertheless, the chancellor of the exchequer not only neglected to comply with the object of those remonstrances, but, usually under pretence of the necessity of the public service, renewed his demands for further aid; and that, under the exigency of the case, as stated to them by the chancellor of the exchequer, the directors of the bank were from time to time induced to consent to further accommodation.

4. That it appears that the chancellor of the exchequer frequently solicited such further accommodation, in the most anxious and pressing terms; declaring, that it was impossible to avoid the most serious embarrassment to the public service, unless the directors of the bank afforded the assistance 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 expressed their reluctance in strong language; and that they at last, that is to say on the 28th of July, 1796, thought it necessary for their own justification to request the chancellor of the exchequer to lay before his Majesty's cabinet their most serious and solemn remonstrance; in which they declare that, " sensible of the alarming and dangerous state of public credit, nothing could induce them to comply with the demand then made upon them, but

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

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

7. That it appears that it had seldom been the custom of the bank of England to advance, on the account of such bills, more than from 20,000l. to 30,000l. and that even during the American war such bills never exceeded at any one time the sum of 150,000l.; the wisdom of our ancestors having foreseen, and provided against, the mischief of similar advances, by a clause in an act passed in the fifth year of William and Mary, by which the governor and company of the bank of England were restrained from advancing any sums of money, other than on such 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 passed, containing a clause 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 said act of William and Mary, respecting such ad. vances to government, the amount of treasury bills paid at the bank continued progressively to increase; and that between the 1st of January, 1795, and the 25th of February, 1797, sums to the amount of upwards of 15,000,000l. were at different 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 such advances, and represented to him the ruinous consequences to themselves and to the public, of continuing the system of making treasury-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 consent to."

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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 of 500,000l. and likewise so to arrange his payments as to put an end to the account; but that, nevertheless, the said promises never were kept by him, and that the advances on treasury-bills on the 28th February, 1797, amounted to 1,619,0491.

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

12. That the extent of such remittances occasioned at so early a period as the end of the year 1794, and the beginning of the year 1795, great alarms 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 apprehension, that it was intended to grant a further loan to the emperor, came to a resolution by which they declare their unanimous opinion, that, should such a loan take place, it would be "most fatal in its consequences to the bank of England." That they communicated such re

solution to the chancellor of the exchequer, who assured them "he should lay aside all thoughts of it, unless the situation of things relative to the bank should so alter as to render such a loan of no importance or inconvenience to them."

13. That on the 5th of February, 1796, the chancellor of the exchequer, after stating, in conversation with the governor and deputation from the bank of England, his opinion of the necessity of further assisting the emperor, promised to take no step in that business without previously communicating

to them his intention.

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

"Resolved, 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 state, should in the present state of affairs take place, it will in all probability prove fatal to the bank of England.

"The court of diretors, therefore, do most earnestly deprecate the adoption of any such measure, and they solemnly protest against any responsibility for the calami. tous consequences that may follow thereupon.'

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To which resolution, when communicated to him, the chancellor of the exchequer returned for answer 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 resolved on without previous communication with the bank, he did not see any reason for these resolutions; that he did sup

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pose they were adopted in a moment of alarm, and that he should consider them in that light."

15. That, both from the general tenor of the said answer, and from its particular reference to the substance and matter of the resolutions then communicated to him, he gave the governors, &c. of the bank to understand, that he was bound by promise to them to negotiate no loan for the service of his imperial majesty, nor to make any remittance either to his said imperial majesty, or any foreign prince, under any pretence whatsoever, without previously communicating such his intention to the bank of England; that the directors so understood him, and that impressed with that belief, they abstained from making any further remonstrances on this subject.

16. That nevertheless the chancellor of the exchequer for some time prior to February 11, 1795, clandestinely remitted, and did for several months subsequent, clandestinely remit, his said imperial majesty, and cther foreign princes, large sums of money, in defiance of his repeated promises, and in violation of his solemn engagement with the bank of England, and consequent upon their resolution of the 11th of February.

17. That it appears, that if the said advances of the bauk to government had been paid off when required, or considerably reduced, the bank would have been enabled to reduce, if expedient, the amount of its outstanding notes; and that such option would have been of essential service to its interests.

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

1797.

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

19. That it appears, that if the advances on treasury bills had been paid off when required, and as the chancellor of the exchequer, had promised, and the foreign remittances abstained from, as the chancellor of the exchequer had likewise promised, there would have existed no necessity for suspending the due and ordinary course of the bank payments in cash.

20. That it appears to this house, upon an attentive examination of the evidence reported by the secret committee, upon a minute perusal of the correspondence between the governor and directors of the bank of England and the chancellor of the exchequer, during the years 1795, 1790, and 1797: and after a thorough review of the whole circumstances of the case, that the neglect of the chancellor of the exchequer in discharging or sufficiently diminishing the amount of the sums advanced to government by the bank of England, his perseverance in directing treasury bills of exchange, to an amount unexampled, to be paid at the bank, his frequent promises and constant breach of those promises to reduce their amount within the sum of 500,000l., and that the enormous amount of his remittances to foreign princes in loans and subsidies, were the principal and leading causes which produced the necessity for the order of council on the 20th of February last.

The earl of Liverpool said, that the subject upon which he was now to address their lordships was attended with difficulty. He hoped, however, to be able to satisfy them, that they ought not agree to the re

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solutions which had been proposed. With regard to the constitution of the committee, to which the noble duke objected, he would answer, it was necessary that they should have before them every thing connected with the investigation; and with respect to the conduct of it, never was the conduct of a committee more candid and impartial. The noble duke had said, that a great part of his charge was directed against the chancellor of the exchequer; yet this culprit had been examined upon oath-the first instance in this country of the kind, and which, in fact, was contrary to the principles of the law of England. With regard to the summary alluded to, he was sure nothing could be expressed with greater candour and modesty. That the diminution of bank-notes, according to the duke's position, would increase the quantity of specie, was an absurd hypothesis; that it might increase the demand of them, was the only view in which the observation was intelligible. His lordship then desired the clerk .might read the minutes of the court of directors in 1795, and the answers of the chancellor of the exchequer on the imperial loan, in 1795 and 1796; the resolution of the committee of treasury, dated February 11, 1796, with his further answers. His lordship said, it appeared, from the evidence contained in the report, that the bank had at different times made application to the chancellor of the exchequer, stating the danger which they apprehended from the continuance of foreign remittances, A direct answer was given to the two first, viz. that no imperial loan should be brought forward. The third application mentioned both loan and advances; the answer intimated, that there should be no loan, but it never

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was to be considered as implying that there should be no advances. His lordship observed further, that the noble duke was inaccurate in the facts which he stated as a consequence of this measure; no bills drawn for these advances were received till July, yet the rate of exchange from October that year, till March following, rose considerably in our favour. It appeared from the report, that 14,918,000l. had been remitted to the continent this war, and in 1763, fifteen millions; were we less able now to sustain such a change? It was proved that the balance of trade for the last four years was at an average of ten millions a-year; the whole remittances out of the country had been thirty-two mil lions, and the balance for the same four years of the war had been forty-two millions:-was it possible the stoppage of the bank could be ascribed to the imperial remittances? With regard to the effect of the advances by the bank to government, he had to observe, that a very considerable sum had been stated as advances by the bank, which in fact did not belong to them, but was the amount of unclaimed dividends, which had been taken for the public service. His lordship observed, that the advances to government were by no means unprecedented; for in the year 1780, they were 10,000,000%. somewhat higher in 1797; and in 1793, they were only an hundred thousand less. The bank, too, must be able to make advances in proportion to the general prosperity of commerce and increase of wealth. Our commerce was nearly double to what it was in 1782 and 1789. Was it possible that this advance could produce effects so serious as to suspend the money-pay ments of

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the bank? His lordship said, that country bank-notes where the chief circulation in the country; and these in the moment of alarm produced a run upon the bank of England, the reservoir of the cash of the kingdom. After commenting upon the subject for some length, he concluded by moving the previous question.

The earl of Guilford observed, that, whatever might be the necessity of continuing the order of council, he doubted the necessity of originally issuing it. He thought that the bank might have been enabled to go on, or, if obliged to stop at last, it would have been better that it had shut up the doors, and shewn to the public that its stoppage arose from its own want of cash; instead of its being proved that such an event arose from the wants of government. The bank themselves, he remarked, had expressly de. clared, that they were of opinion that the imperial loan had produced the scarcity of their cash; and the chancellor of the exchequer had no right to disturb their authority. The bank had repeatedly demanded of government repayment of their advances, which was one of their reSources for extricating themselves from their embarrassment; and he did not doubt but, had the promises of the chancellor of the exchequer been kept, they would have been enabled to go on. His lordship concluded by saying, they should consider whether they could avoid a decision by supporting the previous question, which he admitted was a fir way of getting rid of the resolutions, which however were, some of them, undoubtedly truisms.

Lord Auckland rose to make some incidental remarks in answer to the duke of Bedford, nearly similar to those delivered by the earl of Liverpool.

The duke of Leeds congratulated the house on the favourable description of the situation of the country, given by the noble ear! who spoke second in the debate. He lamented that there should be any misunderstanding or dispute between the government and the bank. His grace concluded by saying, he thought it very extraordinary, and somewhat strange, that the noble duke should come forward with what might be considered as an opposition motion, grounded upon the very documents that afforded those who opposed it a fund of reasoning against it.

Earl Strange (duke of Athol) said he had read the report with the greatest attention, and thought it contained a conclusive evidence, that no blame was ascribable to the chancellor of the exchequer for his conduct with regard to the bank. He had listened to the arguments of the noble duke that day, and no thing that he had heard from him had in the smallest degree altered his opinion. But, before he sat down, he could not help expressing his feelings at the violent language of the noble duke in the conclusion of his speech. The noble duke he was persuaded would not have used such language in any other place, and he thought the same regard, decorum, and respect, was due to their lordships in general, who were at liberty to entertain whatever political sentiments their own judgments directed.

The duke of Bedford rose to apologize for some of the intemperate expressions which he had made use of in the conclusion of his speech. His grace then referred to the evidence of Mr. Giles, Mr. Raikes, and Mr. Bosanquet, to shew, that they clearly understood the chancellor of the exchequer, that neither loan nor advances were

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