They conceive, that such security will be best provided, by requiring the Bank to revert, at an early period, to that principle on which, previously to the Restriction act, their issues were regulated, a reference to the price of gold. They propose therefore, that time have ing heen allowed for the repayment of a portion of the advances to government, the Bank shall undertake, at a given period, to deliver gold in exchange for their notes, in the manner already described. Between the present time and the commencement of the year 1820, your Committee cannot anticipate an operation of any of those causes, which affect the value of the precious metals, so extensive as to prevent the Bank from counteracting the effect of them, by such a reduction of their issues, as may be made without producing public inconvenience. If the price of gold shall remain the same as it is at present, the demand from the Bank, which will have to deliver it at that price, will necessarily be very limited. If, in the interval any causes shall affect it, and produce a rise in its price, the Bank must in that case contract its paper, either positively, as compared with its present amount, or relatively, to any increased demand which there may be for it; and thus, by increasing its value as currency, proportionately diminish the inducement to demand gold. It may be objected, that the adoption of this suggestion appears to recognize a departure from the ancient standard of value; but It recognizes it no otherwise than as it at present practically exists; it recognizes it for a very limited period, and with no other view, than to provide for the gradual return to that standard, the deviation from which it acknowledges. The Committee trust, that they have sufficiently explained the grounds on which they recommend, that, with a view to the establishment of a metallic standard of value at the earliest period, the Bank should be required to deliver standard gold in exchange for their notes. They do not express any preference for the system of bullion payments over that of payments in specie abstractedly; nor are they prepared to recommend them as a permanent substitute; but they consider them the best means of facilitating and ensuring the resumption of payments in specie with the least public inconvenience. They are of opinion, that, when once the ancient standard of value in this country has been re-established, the great impediments to a return to our former system will have been overcome; aud it will be in the power of the Bank, or of individuals, by taking advantage of a favourable state of exchange, to increase the supply of the precious metals in this country, to any extent to which they are likely to be required. Your Committee are aware that it may be objected to the plan of bullion payments, which they have recommended, First, That + by necessarily continuing the notes below five pounds in circulation, it continues the present inducements to the crime of forgery; and, secondly, That by requiring the presentation of a large amount of notes in demand for gold, it gives to the possessor of notes to that amount, an accommodation which the holder of a smaller quantity will not possess. On the first of these objections, your Com mittee observe, that it is scarcely possible to calculate on a resumption of specie payments, accompanied with the total exclusion of the small notes, at a period much, if at all earlier than that at which it may take place, if the recommendation of the Committee be adopted. When the legislature has, at former periods, contemplated the removal of the restriction, the necessity of continuing the circulation of the small notes for some time subsequently, has been foreseen, and is at present provided for by law. It is true, that after the resump tion of cash payments, the amount of small bank-notes in circulation would probably be diminished; but there seems no reason for concluding that the temptation to forgery, which must depend on considerations of risk and profit, would be diminished in proportion to the decrease of those notes, provided they were not altogether excluded. The force of this objection will also be lessened propor tionately to the degree of success which may attend the attempts, that are at present making, to devise means of rendering the imitation of bank notes more difficult. Your Committee have been informed, that the plan recommended by the commissioners appointed for inquiring into the mode of preventing the forgery of bank-notes, may be expected to be in full operation in about three months; and they have received, from two scientific members of that commission (sir Joseph Banks and Dr. Wollaston) the satisfactory assurance, that their confidence in the increased security which the new form of note will afford, as well by creating fresh obstacles to a successful imitation, as by giving a more obvious facility to the public in detecting any attempt to give currency to forged notes, has been confirmed, by the progress of their inquiry and experiments since the date of their report communicated to parliament. With respect to the second objection to bullion payments, your Committee remark, that the object of the plan which they recommend is, by securing a control over the quantity of the circulating medium, to regulate the value of the whole, and to maintain paper on a par with gold. While this object is effected, the holder of notes, to whatever amount, has a security for their value, which, without this plan, he would not possess during the interval which must precede the resump tion of cash payments. Should the House determine to act upon the recommendation of the Committee, it will be expedient to continue the act which passed in the present session, restricting the farther issue of gold coin from the Bank. They propose no interference with the laws which regulate the mint, conceiving it desirable to retain, as a check upon any undue contraction of the issues of the Bauk, the power which individuals at present possess of receiving coin from the mint in exchange for bullion, without loss or deduction, at the rate of 3l. 17s. 10d. per ounce. They recommend, not as an appendage to the plan which they have suggested, but as a politic measure under any system of currency, the total repeal of the laws which prohibit the melting or exportation of the coin of the realm. Your Committee conceive it to have been clearly demonstrated, by long experience, that they are wholly ineffectual for the object for which they were designed; that they offer temptations to perjury and fraud, and give those who violate the law, an unfair advantage over those who respect it. Your Committee have received an intimation from the directors of the Bank of Ireland, that they shall be prepared to resume cash payments six months after their resumption by the Bank of England. In making this communication, the directors contemplated a return to payments in specie; but the Committee have the satisfaction of stating to the House, on the authority of the governor of the Bank of Ireland, whom they have had an opportunity of personally examining, that there is reason to believe, that no difficulty would exist, on the part of the Bank of Ireland, in carrying into effect, any regulations of the same nature with those which may be adopted with respect to the Bank of England. If these notes on an average circulate for three years, the highest aggregate amount to which they can have reached is 29,232,8701. Your Committee are led to conclude, from the information of Mr. Lloyd, that the whole amount of notes stamped, which still remain in such a state as to be circulated, can never have been at once in circulation. He says, a banker may have 50,000 notes lying by him; his having paid the duty, and having the notes ready, by no means proves that they are in circulation. Sometimes there may be a very large amount locked up by him, at other times they may be almost all in circulation. In time of alarm, he takes care to have them as much at home as possible; in time of prosperity and general confidence, he has no hesitation in issuing them on satisfactory security. Mr. Lloyd expressed an opinion, that the issue of paper by the country banks might mittee are rather led to infer, from the general be from 40 to 50 millions; but your Comtenor of the information before them, that the amount of this branch of the paper circulation, throughout Great Britain, has never exceeded from 20 to 25 millions. Your Committee would here close their Report, if they did not think it necessary, shortly to advert to the circulation of country banks. The notes of all those establishments are exchangeable for the notes of the Bank of England. As a part of the currency, therefore, they must be affected by any fluctuation in value to which bank of England notes are Whatever may have been the amount, it now liable; and, consequently, will be alike appears undoubtedly to have been liable to secured from such fluctuation, by any arrange- from the account of the stamps before alluded great fluctuations, as may indeed be inferred ment which will effectually place and maintain the latter upon a par with a metallic to, but with more certainty from accounts furstandard of value. Although, from this view nished by the three chartered banks of Scotof the subject, your Committee are led to the land, representing the proportions which the conclusion, that there can be nothing in the quarterly averages bear to each other, of the nature of the circulation of country banks, respective circulation of each bank, at three which can form an obstacle to the gradual corresponding periods; the scales by which resumption of cash payments upon the plan the circulation of these banks is thus shown, which your Committee have suggested, they establish the degree of the proportionate varihave made it their endeavour to ascertain the ations in each respectively; but it is to be probable amount of that circulation, at dif- observed, that those scales, being constructed ferent periods; though they have to regret upon different data, afford no means of comthat they have not been able to obtain as pre-paring with one another the actual amount of cise and full information as might be de- their respective issues. sired. There are not sufficient data from which to ascertain the exact amount of country banknotes at any one time in circulation. Your Committee called for accounts from the stampoffice, of the number of promissory notes Last Third Last Quarter, Quarter, Quarter, 1813. 1816. 1818. As a very large part of the currency of Scotland is furnished by those banks, it must be inferred from the preceding scales, that whatever was the amount at the close of 1813, not less than one-third had been withdrawn from circulation in 1816, since which period an equal amount has been re-issued. A fluctuation, corresponding with this in point of time, and at least, equal in degree, appears to have taken place in the paper issued by the country banks in England. The number of these establishments licensed in 1814 - was 940, Mr. Lloyd stated, that the circulation of the country banks was at its highest in 1813 and 1814, but was considerably reduced in 1816, and the beginning of 1817; and being asked, as to the amount outstanding at the latter period, when compared with the former, he answered, "I can hardly say; I should think it was reduced nearly one-half." Your Committee were furnished, by Mr. Stuckey, with the following scale of the circulation of a considerable country bank, for the last four years: and farther information on the same subject will be found in the evidence of Mr. John Smith, a member of the House, Mr. Samuel Gurney, and Mr. Gilchrist. Whatever may have been the diminution in the amount of the circulation of country banks in 1816 and 1817, it was not in any degree caused by a diminution of the issues of the Bank of England. The circulation of country paper is liable to be affected by want of confidence, generally brought on by extensive failures in some of those establishments, and the result of which is, that other country banks, however solvent, participate more or less in the general discredit, and are obliged to restrict their issues, from a regard to their own security. In the opinion of Mr. Tooke, "A like effect is sometimes produced, and in a much greater degree, from the discredit of their customers, to whom they are in the habit of advancing money; most of their customers being holders of articles which are liable to be affected by a general depression of price." Although there may be reason to infer from the opinion of the witnesses most conversant with the management of country banks, and to whose evidence your Committee beg leave to refer, that a reduction in the amount of the notes issued by the Bank of England would speedily and necessarily be followed by a proportionate reduction of the country bank paper; still it must be ob. vious, that, independently of that cause, the latter is liable to a sudden and highly incon. venient contraction, under such circumstances (VOL. XL.) of distrust and difficulty as occurred in 1816. The effects of this contraction, unless obviated by a corresponding increase in the issues of the Bank of England, the credit of which is fortunately unassailable by the influence of similar circumstances, must have a tendency, by diminishing the amount of the paper currency, to raise the value of the whole. This, in the opinion of your Committee, was one of the effects produced by the rapid contraction of our currency in 1816 and 1817; and to it may be ascribed, in part, the fall in the price of gold and the favourable state of the foreign exchanges, during that interval. Such contraction is an evil, to which the system of country banks, resting upon individual credit, may be occasionally liable; but your Committee are inclined to hope, that it will not be likely either to prevail to the same extent, or to endure for so long a period, when the fluctuations, to which an inconvertible paper currency is exposed, shall be checked, by the operation of the plan which they recommend for the gradual resumption of cash payments. Whether it may be practicable further to provide against inconvenience to the public and the loss to individuals, which arise from the occasional insolvency of country banks, and to make such provision, without an interference with the rights of property, and the transactions of the community founded on commercial credit, are questions of great difficulty; respecting which your Committee could not, without further evidence and considerable delay, have enabled themselves to submit an opinion to the House. Your Committee have forborne from enter ing into any reasoning upon the effect produced upon the value of our currency, by variations in the numerical amount of the notes issued by the Bank of England. So many circumstances contribute to affect that value; such, for instance, as the varying state of commercial credit and confidence the fluctuations in the amount of country bank paper the different degrees of rapidity with which the same amount of currency circulates at different periods,-that your Committee are of opinion, that no satisfactory conclusions can be drawn from a mere reference to the numerical amount of the issues of the Bank of England, outstanding at any given time. 6th May 1819. The Report was ordered to lie on the table and to be printed. MOTION FOR REFERRING THE PETITIONS FROM THE ROYAL BURGHS OF SCOTLAND TO A SELECT COMMITTEE.] Lord Archibald Hamilton, in rising to bring forward his motion on the subject of the Royal Burghs of Scotland, said, that after the number of petitions which had been (N) presented to the House praying for a reform in the constitution and government of the royal burghs of Scotland, he trusted he need not offer any apology to the House for occupying their attention for a short time on a motion which was intended as a remedy to the oppressive grievances complained of. He fully concurred with the petitioners on this subject; and he hoped he should lay such a case before the House as would induce them to grant a committee for the consideration of the prayer of the petitioners. When he brought this question, or at least one intimately connected with it, the abuses of the burgh of Aberdeen, before the House last month, he stated as distinctly as he could, in order to guard against misrepresentation, both what his motion was, and what it was not. Even with that precaution, he had not escaped from the unfair and unfounded insinuations of the gentlemen opposite. They charged him with using the subject merely as a cloak for parliamentary reform; a charge totally without ground or even plausible pretext; his object merely being a reform in the internal management of the affairs of the burghs, radical and comprehensive indeed, but not more than commensurate with the occasion. He now again denied having any such intention as that which had been ascribed to him. He denied it, both on his own part and on that of the petitioners and if any hon. member remained still doubtful, a perusal of the petitions on the table must remove all suspicions from his mind. The grievances complained of were not new; neither were they partial or transient. Twenty-five years ago similar complaints had been made by the burgesses of Scotland; and a report had been laid on the table of the House by a committee appointed to inquire into the subject. Indeed he regretted that that report had not been reprinted in time to be put into the hands of members before the present discussion, as it would have shown them what were the opinions entertained not only by the petitioners of that time but also by a committee of this House at the period to which he alluded of the burgh government of Scotland. But before he entered upon his motion, he wished to state plainly and frankly to the House how far a reform of the Scots burghs was connected, indirectly with parliamentary reform. He said * See vol. 39, p. 1275. indirectly, because it had no direct connexion with it whatever. A principal subject of complaint on the part of the burgesses and the ground and foundation of all other complaints, was, that the magistrates were self elected: and that they (the burgesses) had no control, either over the elections, or over the acts of the magistrates. [Here the lord advocate and lord Castlereagh were observed in close conversation on the treasury bench.] He claimed the attention of the noble lord and the learned lord for a few moments, not so much for himself, as in behalf of the petitioners, although he was not so anxious for their attention as for their conversion; but if he could not expect their careful consideration of what he said, he trusted he should experience the common courtesy usually shown to a member of that House on such an occasion, that of not being interrupted. He repeated that the charge against the petitioners and against himself of aiming at a reform in parliament, under the disguise and cloak of a different purpose was unfounded. Between a reform in parliament and the present object there existed no necessary or direct connexion. The remote and indirect connexion was simply this:-at present the magistrates returned the member to parliament without any interference or participation of the burgesses the burgesses wished to have the same power as to the election of their magistrates, which the magistrates now had in the election of the parliamentary representative. And if this were granted, the magistrates would still retain the same power they now enjoyed-and the only difference would be, that the magistrates, being thus themselves appointed and maintained by public opinion instead of being self-elected and self-maintained in defiance of it, would probably elect such members as were approved by the burgh at large. In that way, and in that way alone, was a reform of the burghs connected with parliamentary reform; and having thus as he trusted disposed of that part of the subject, he would, with the leave of the House, proceed with the question more immediately before them. The existing burgh system of Scotland was so oppressive to the inhabitants, so abhorrent from every principle of justice, and so very different from the government of any other part of the united empire, and indeed he might say of any other part of the civilized world, that he found it their accounts or to check their expenditure, they were responsible to the full extent for the debts thus contracted. Such at least, was the prevailing opinion. This had been fully shown in the case of Aberdeen. There the burgesses had no means even of detecting the frauds committed by the magistrates; and if they had the means of detection, they were unable by the present practice, fortified by decisions at law, to obtain any redress. When he used the word fraud, he did not mean to apply it in the ordinary sense of peculation, or as generally applicable to the magistrates. He meant (as he had stated distinctly, when he brought the case of Aberdeen under the notice of the House) fraudulent modes of incurring debt by false and fraudulent entries in the records of council. Money had been borrowed under the signature of members of council, who had not been present, nor sanctioned such borrowing. Was not this single case sufficient ground for granting a committee? The case of Aberdeen, had become, indeed, notorious; but the petitioners said the system was the same in the other burghs. If that statement were untrue, a committee of that House could easily detect its falsehood. If it were true, a committee could so report it, and thus give the House the opportunity of applying a proper remedy. In either case, the appointment of a committee would be beneficial. But there exists better authority than his, or the learned lords, both for the extent of the evil, and the absence of all remedy. The authority he alluded to, was the testimony of the magistrates of Aberdeen themselves, who had stated and recorded "their decided opinion, that the present mode of election of the town council and management of the town's affairs, are radically defective."—" of a radical change in our system of burgh government.' difficult to conceive how the House could refuse a committee to enquire into that system and the mischiefs, the actual mischiefs, as well as discontent, which it so universally produced. He would presently read to the House some extracts from the report of the committee appointed on this subject twenty-five years ago; by which it would be seen, that the committee allowed the complaints of the burghers to be well founded; and yet, not a single step towards redress had been taken in consequence of that report.-He must now say a word or two on the observations which had fallen from the learned lord opposite, on the petitions which had been presented to the House on the subject. When petitions were first presented against the burgh system, the learned lord objected that they were not numerous, and therefore could not be considered of any weight; when they poured in from all parts of Scotland, the learned lord was obliged to allow, that they were numerous, that they were general, but then, he contended, that they were not respectably signed. It was true, that on this latter point, the learned lord was obliged to shift his ground; for when taxed with having urged it, he gave a different interpretation to the words which he had used, or at least, a different interpretation to that in which his words had been understood, both in the House, and out of it. The evils complained of had not been denied; the system had not been defended. Several objections to any remedy had been stated by the learned lord; but neither he nor any other hon. member had attempted to defend the existing system. But he lamented to find, that the evil which the learned lord and his colleagues were unable to defend, they were not unwilling to uphold and perpetuate. He appealed to all those who heard him, if, in the cases brought under the notice of the House, particularly" Without this, no man, or set of men, in that comprehended in the petition from Aberdeen, a scene of fraud and oppression was not disclosed which called loudly for investigation? What was the existing system? It was self-created power, acting under self-granted immunity, sanctioned by law. The magistrates first appointed and continued themselves in office, and then had this unbounded control of the funds of the different burghs; they were empowered to contract debts to any amount they pleased, and though the burgesses were not entitled to inquire into § can conduct the affairs of the corporation with credit to themselves, or advantage to the community." Could any thing be more decisive and convincing than such testimony from such a quarter? And this leads to the mention of another important truth, that the petitioners had no other means of redress than by an application to that House. Whatever might be their opinions, whatever might be their conviction of the unjust, iniquitous, and oppressive conduct of the magistrates, still there was no remedy, there was no |