said, he would beg to ask the Secretary of State for the Home Department, Whether it is his intention this Session to introduce any measure for abolishing Turnpikes; and, if not, whether he will be disposed to leave out of the Continuation Act those trusts which are free from debt?

said, in reply, that it was not the intention of the Government to introduce any general measure for the abolition of turnpikes. It was undoubtedly the custom to extinguish trusts whenever the debt had been paid off, but there were some exceptions, however, to that rule. With regard to the case which the hon. Member had doubtless in his mind, that of the Essex roads, the trustees, and a majority of the parishes through which the highways passed, were of opinion that the trust should be continued. Under these circumstances, it would not be extinguished.

said, he wished to ask Mr. Solicitor General, Whether it is within the competence of the Prerogative of the Crown, upon the advice of the Minister of the day, to alienate any undoubted territorial possession of the Crown or the country without the knowledge or consent of Parliament; and, if so, whether such exercise of the Prerogative is not, in fact, equivalent to the possession by the Government of an arbitrary power of such alienation of territory?

Sir, the hon. Member put the same Question to the noble Lord at the head of the Government not long ago. If the noble Lord had not answered the hon. Gentleman, I do not know that it would have been quite consistent with my duty to do so. Since the noble Lord did answer the Question, I may repeat the substance of his reply, without going into the argument involved in the question. There is neither law nor constitutional usage to make the assent of Parliament necessary to the cession of territories of the Crown unless the laws of this country have been introduced into those territories, or unless Parliament has legislated concerning them.

said, he wished to ask the hon. and learned Gentleman to explain the exact qualification he had introduced into his answer. The hon. and learned Gentleman said it was competent to alienate territory of the Crown without the as- sent of Parliament unless English laws had been introduced into the territory, or that it had been legislated for in Parliament. He wished, for example, to know whether the Crown possessed the Prerogative of ceding Colonies like Canada, Malta, or Gibraltar without the assent of Parliament?

I really cannot argue the question with the hon. Member. When British subjects have settled in newly-discovered territories —not countries acquired by conquest or cession—they carry with them the laws of this country. In that case cession could not take place without the consent of Parliament. In the case of conquered or ceded countries, if Parliament had legislated concerning those countries, then I apprehend the concurrence of Parliament might be necessary.

said, he would beg to ask the Secretary of State for India, Whether it is true that he has issued instructions to remove the Seat of Government of the North Western Provinces from Agra to Allahabad; if so, whether he has any objection to the production of the Correspondence relating to the same?

in reply, said, he had issued no such instructions as those referred to, and no correspondence, that he was aware of, had taken place on the subject.

said, he wished to ask the Secretary to the Treasury. If it is the intention of Her Majesty's Government to authorize the Board of Works to proceed as formerly with works of Arterial Drainage in Ireland, and to place at the disposal of the said Board fur that purpose sufficient funds, repayable by instalments by the owners of the land improved by such works of Drainage?

said, in reply, that it was not the intention of the Government to authorize the Board of Works to proceed with works of Arterial Drainage in Ireland.

said, he would beg to ask the Secretary to the Treasury, Whether, in consequence of the small number of horses kept for hire in some parts of the country, and the difficulty experienced by the County Constabulary in obtaining horses on hire from licensed persons, the Government will consider the propriety of recommending to Parliament to exempt from duty horses hired for Police Service, on the same principle on which an exemption is now allowed by law in the case of horses hired to convey prisoners to Gaol?

in reply, said, it was objectionable to multiply exemptions from general laws. Except in a few places the Police had no difficulty in procuring horses from licensed persons, and as those persons paid a heavy duty, it was not desirable to interfere with their trade. The Government, therefore, did not intend to extend the exemption referred to by the hon. Member.

on rising to move an Address on this subject, said, that as he had more than once called the attention of the House to this subject, he would state very briefly his reasons for again introducing it; and would beg permission before doing so to recapitulate, by way of preface, the transactions to which his Motion referred. It was well known that the French emancipated their slaves after the Revolution of 1818, and that the result in their colonies, as in ours, had been great difficulty in carrying on cultivation, in consequence of the dislike of the negroes to regular work. There were published annually in France expositions of the state of the empire, called Livres Jaunes, which, by a pardonable Hibernicism, had been termed French blue-books. Certain hon. Members, in perusing that portion of those books which related to the Colonial Department, might perhaps wonder that so profound a politician, as the French Emperor should set a high value on his colonies; but so it was. The Emperor anxiously desired the prosperity of his colonies; and seeing that the only way to make them to compete with slave countries was to give them abundance of labour, unlike our Government, which for years threw every obstacle in the way of our colonies obtaining labour, he made it an object of Imperial solicitude. The earliest results of his exertions were not happy; they were the so-called free emigration from Africa, the consequent difficulty with Portugal about the Charles et Georges, and the very natural desire of the Government of this country to put an end to so questionable and troublesome a system. The price paid to the French for giving up recruiting on the coast of Africa consisted of two treaties, one concluded in 1860, the other in 1861, by which France was permitted to draw-labourers from British India. He could not wonder that this concession appeared at first sight expedient, or at any rate the least of two evils. But it must be borne in mind that the Government of this country had wisely declared that the Indian emigrants were not capable of taking care of themselves. They had therefore laid down rules for the protection of these emigrants, and appointed officers to see that those rules were observed. With regard to our own colonies, trickery and concealment were impossible, and he had himself this Session induced the hon. Member for Honiton (Mr. Moffatt) to add to his annual Returns on the subject of immigration the number who returned each year to their own country and the amount of earnings they carried with them, so that the House might see at a glance the work- ing of the system. Could this be done in a foreign colony? The earliest and, he believed, the only French colony which had as yet taken advantage of the treaties was the island of Réunion or Bourbon, near Mauritius, which, having got so bad a name at Madras that no more emigrants could be obtained thence, gladly availed itself of the more distant labour-market of Calcutta. A British Consul had been stationed in Réunion to protect the immigrants and see that the stipulations of the treaty were duly observed. In consequence of certain rumours which had reached him, he asked the Under Secretary for Foreign Affairs last Session, on the Vote for this Consul's salary, what reports had been made by him of the condition of the coolies. The reply which he received was very unsatisfactory; he elicited no information about the state of the Indians in the island, but an admission that there had been great mortality at sea. This induced him to apply to a gentleman of high standing in Mauritius, wholly unconnected with sugar estates or planters, who had since paid a visit to Réunion and made inquiries for himself, and who entirely confirmed the reports of ill-treatment which had reached him. Without going into individual cases, he would merely mention two facts as indicative of the system pursued. The first was that coolies found in the road or elsewhere without a pass from their masters, and those against whom their masters had made a complaint of idleness, were carried off to the atéliers, in reality travaux forcés, where they were compelled to work as convicts; and the operation many of them were engaged in, while his informant was in the island, was standing up to their shoulders in the sea, passing along stones for the harbour now in course of construction at Réunion. The other fact was that many, who had been introduced by a company called the "Sociéte é Agricole," at so much a head, were pronounced not good agricultural labourers, and were induced on that account to accept a lower rate of wages than that promised in India. Now, he was not advocating the claim of our colonists to monopoly in the labour market of India, but he could not help asking what fair competition there could be between employers who fulfilled their contract to the letter and those who repudiated it. His informant concluded his letter in these words—

"The result to which I have come is that Coolie immigration to Réunion is a modified form of slavery, and ought to be given up, unless placed upon a better footing."

Such were his reasons for placing this notice upon the paper early in the Session. Since then, in fact only last week, the mail from India brought an important corroboration of these statements. A debate had taken place in the Viceregal Council at Calcutta on this very question. It was on the 5th of last month. In the course of the discussion reference was made to the deceptions practised on the coolies by the recruiting agents, to the great mortality during the voyage, and the great mortality in the island. Mr. Ellis, one of the speakers, quoted from a newspaper published in Reunion, which complained "of the physical inability of the Indians to work in the sugar plantations," but added that "the demand for labour was so great that even such was eagerly taken up." Upon which Mr. Ellis remarked, "that he much feared the old slavery opinion, that it paid to use a man up with labour for which he was unfit, prevailed at Réunion." It was also stated that no less than 9,000 coolies had left India for this diminutive island of Réunion—a mere speck in the Indian Ocean—in little more than two years, and that a treaty had been entered into permitting the Danes to take coolies to Santa Cruz, in the West Indies. It was asked whether we intended to depopulate India. The hon. Member for Maidstone had recently expressed just indignation at the permission given to the French Emperor by the Viceroy of Egypt to take a black regiment to Mexico; but we had given the Emperor permission to deport whole tribes, if he pleased, to the notoriously deadly climate of Cayenne. The Treaty of 1861 could not be terminated before eighteen months after July, 1864, but the Governor General of India, by Article 26, had the power "to suspend emigration to any one or more of the French, colonies, in the event of his having reason to believe that proper measures have not been taken for the protection of emigrants." It might be objected that should such power be exercised the French could, under the same article, terminate the whole convention, and would probably resume the objectionable emigration from Africa. To this he replied, that if the French chose to disgrace themselves by reopening the slave trade, we should not be responsible for it; but we were re- sponsible for giving our deliberate sanction to what, if his information were correct, was the slavery of our own fellow subjects in India. He was brought therefore to this conclusion—either the information which he had received concurrently from various sources was wholly inaccurate, which he could scarcely believe; or the Consul, whose salary now appeared for the third time in the Estimates, and who was appointed specially to protect the immigrants, and report upon their condition, had utterly neglected his duty, which he could not believe, either; or there were documents in possession of Her Majesty's Government which ought to be communicated to the House, and upon which, in all probability, action ought to be taken. It was for these reasons that he ventured to move, pursuant to notice, an Address for Copy of any Communications from Her Majesty's Consul at Réunion, respecting the condition of natives of British India held to labour in that Island.

seconded the Motion.

said, he was willing to admit that the information which he communicated to the House last year on the subject of the condition of Indian Coolies in the Island of Réunion was not satisfactory, but the fault did not lie with him nor with the British Consul at Réunion, upon whose reports it was founded. The fact was, that upon the arrival of the ships from India the Consul had means of ascertaining what mortality had taken place on board; and when the Coolies were removed to the quarantine station appointed for their reception, he could keep his eye upon them and observe how they were treated. Once, however, they were distributed over the island, it was extremely difficult for him to keep them under his notice. Perhaps the hon. Gentleman was not aware that no fewer than 47,000 Indians had been taken to Réunion, a large number of them before the convention was concluded between the English and French Governments. These poor persons were so ignorant as very often to be imperfectly aware of how they got there, who were their masters, and what the remuneration for their labour was to be. It had been suggested that they should each have a livret, or little book provided for them, stating in whose employment they were, and other particulars, which might enable the Consul to interfere in their behalf when the necessity arose; but some difficulty had occurred through these books being liable to pass into the hands of persons who had no right to them. In his last report, however, the Consul, Mr. Hill, spoke much more favourably than before of the treatment of the Coolies, both on board ship and after they landed. He stated that he had been over the various places appointed by the French Government for their reception, and that everything which could be desired was done there to promote their comfort. On their arrival they were examined, and if they were found incapable of doing the kind of work they were supposed to be bound under their contract to do, they were placed in a rejected class, called rebutés, and then, as it were, thrown upon the public, their contracts being annulled, and no wages secured to them other than they could obtain by competition in the market. That was the vice of the system, but the fault did not lie at Réunion, but with the agents at Madras and Calcutta, who were so anxious to obtain labourers and to fill the ship, that they engaged those people without taking proper care to see that they were in suitable health and condition for their work. Thus, some of them were reduced to great misery. Each of the rejected immigrants, however, had the option of returning home, but the Consul stated the singular fact that only three had availed themselves of that privilege, and that they were all blind men. As far as the Consul and Her Majesty's Government were concerned, everything had been done that could be done to insure that these persons should be properly cared for. What the hon. Gentleman said was true as regarded those who refused to work being removed to atéliers for a certain time as a kind of punishment. This appeared to be the only means of punishment, and in many cases, no doubt, proved a great hardship. Of course, our Consul was bound to protect these British subjects if they applied to him for protection; but he could not, under the terms of the Convention, interfere unnecessarily. It would not, for many reasons, be advisable to lay the whole of the papers on the table; but he was ready to show them to his hon. Friend, and if there were any among them which his hon. Friend thought it important or expedient to submit to the House, he would have great pleasure in doing what he could to meet his wishes. Upon that understanding, he trusted the Motion would be withdrawn.

said, he had supported his hon. Friend (Mr. Cave) on a former occasion, when he brought the question of the Treaty with France for the immigration of Coolies into Réunion before the House, and he was really surprised to find how truly prophetic the words spoken by his hon. Friend at the time had proved. He was glad to have the opportunity of now supporting him again. They all abominated everything approaching to the name of slavery, and after what had been stated there was every reason why they should specially consider the case of the Coolies sent to this French Colony, who were British subjects, and as such had every claim to their protection. They had all heard of a marriage de convenance, but this was the case of a traité de convenance, enabling the French Government to introduce a system which really amounted to slavery under another name. The Emperor had, it was true, given up the slave trade, but he was determined, that whatever the English might do, his colonies should not go out of cultivation for want of labourers; and when urged by the British not to procure them from Africa, he consented, on condition that England supplied him with coolies. It was upon this consideration that the British Government entered into the treaty with France; and there was established what was in reality, though not in name, slavery. Earl Russell, in the House of Commons at the time, himself expressed great doubts as to the policy of entering into this treaty; but, he added, the circumstances were so peculiar, that we might try the experiment, the object being, moreover, to prevent a renewal of the slave trade. He felt convinced that the greatest possible vigilance on the part of our Foreign Office was indispensable in this matter. Since the treaty 9,000 coolies had, as he had heard, been taken to Réunion. Having entered into such a treaty with France, the Danes now pressed us for coolies to be sent to Santa Cruz. A competition was thus springing up on the part of other countries for these labourers; and so anxious were the French to get them to Bourbon that they were not particular as to what class of coolies they belonged, but took the weak and infirm and obliged them to work beyond their strength. We never allowed a single coolie to be sent to a British colony without carefully looking after him, from the day he started till the day he arrived, and also during the whole period of his stay there, and indeed up to the time when he was again landed in India. It was only proper and honourable to us that the same protection should be extended over these persons sent to a foreign Colony, who, as the hon. Under Secretary said, were often ignorant and unable to take care of themselves. He earnestly trusted, that unless they were as well treated in the French as they were in the English colonies, Her Majesty's Government would refuse to renew the treaty.

said, he thought there was a screw loose somewhere in that matter of the Bourbon immigration. The coolies, he must observe, who emigrated to Ceylon and the Mauritius were a perfectly intelligent people, and quite capable of understanding the nature of the bargain they were entering into. It was quite true that our own coolies were well taken care of, and well looked after, both on board ship and in the colonies. They were also, generally speaking, able-bodied men. But that was not the case with the coolies who were taken to Réunion, and if the cripples were cast adrift, as had been represented, our Government ought to take care that none but healthy immigrants were taken to Réunion, and that the same guarantees for their proper treatment while there should be obtained as existed in regard to the coolies in our own colonies. It was not usual for the French, as colonists, to oppress their labourers; but it would seem that a scandalous state of things prevailed at Réunion, though he was sure that a fair representation of any injurious treatment would insure a speedy remedy.

said, he thought that if anything was done to check the immigration of Indians into the French colonies, it would be attended with great injury to the coolies themselves. He had always looked upon emigration from the over-peopled regions of the East as the real way of putting an end to the slavery and the slave trade; and he saw no difficulty in their ascertaining the actual condition of these labourers while living in French colonies. When the treaty was negotiated with France, the Government of that country proposed that the immigrants should be placed under the same regulations as those who were sent to English Colonies. Had that arrangement not been carried out? If it had, it was probable that the sufferings of the coolies had not been very great. The term of service in our own Colonies was five years, and the sum of money which each man brought home with him was a sufficient proof that the treaty worked well. Of these sums a Return was regularly made to our Government; and why should not similar Returns be made to our Foreign Office of the savings of the labourers in the French colonies? In that way it might be easily ascertained whether they were less prosperous than our own.

said, in reply, that he was quite aware that a large number of Madras coolies had been smuggled into Réunion, and had called attention to the fact in 1860; but his present Motion referred only to those who had been imported under 'treaty, he considered what had been stated by his hon. Friend (Mr. Layard) as the strongest condemnation that could be pronounced against the system. In acceding to his proposition, therefore, he must say, if they could not agree as to the papers to be produced, he should feel at perfect liberty on some future day to make another Motion on the subject.

in moving Resolutions with reference to the Appropriation of Supplies, said, that in 1861 he had moved the same as that which was now contained in his first Resolution. In 1862, when moving the appointment of a Committee of Accounts, he had strongly urged the abolition of the system of transfers which took place under the transfer clause in the Appropriation Act. Both these Motions had been unsuccessful. But now, as the blue-book of the Public Accounts Committee had fully borne out all that he had said upon those occasions, he trusted that the House would not deem it presumptuous in, him to press the same Resolutions again upon them. The Appropriation Act was the result of the grand struggle which had ended with the Revolution of 1688. It ought, therefore, to have been maintained unaltered until the present day; no changes at least should have been made in it recklessly and without due consideration, or through carelessness and neglect. Notwithstanding this, many changes had been made in the Bill, including the insertion of the clause which empowered transfers, and the alteration which had been made in the year 1858. With regard to the latter, the Committee of Public Accounts reported as follows: —

"The subsequent alteration was made (in 1858) without the attention of the House being called to the point. The Bill was not printed, and, as your Committee are informed, the change was made through inadvertence. By the alteration the intended limitation was entirely removed." [Second Report, Public Accounts, 1862. page v.]

This was explained by Mr. Anderson in his evidence. Until the year 1858 the army grants used to appear in two aggregate sums, between the Votes of which no transfers could take place. In that year they were massed together. It was said that this was done by mistake; but the mistake had not been rectified, and therefore the sphere of transfers had remained extended. The Report of the Committee continued thus—

"Your Committee recommend that the Appropriation Bill, and the Appropriation Clause, should be printed and distributed in time for consideration, before the Bill passes through Committee of the House."

Until the year 1854 the insertion of the appropriation clause had been made the subject of an Instruction to the Committee on the Bill, and was therefore necessarily inserted in the Appropriation Bill. In that year, however, this practice was discontinued. The result was, that in the second Session of 1857 the appropriation clause was omitted and the transfer clause was retained. In the first Session of the year 1859, the appropriation clause appeared as the 18th clause, and the transfer clause was omitted. In the second Session of the same year the appropriation clause was omitted, while the transfer clause appeared, as the 23rd clause. Last year the Bill was printed, but was not distributed, while certain alterations were made without the sanction or cognizance of the House. One of those alterations provided that deficiencies should only be "temporarily defrayed" out of surpluses; and another enforced that the representations made to the Treasury for leave to transfer should be "laid before the House within one month after the accounts had been sent to the Audit Board." He trusted that his first Resolution would meet with the approval of the House, seeing that it was in the same terms as the Report of the Committee of Public Accounts, He was not urging a technical matter of detail, but sought to enforce the constitutional principle, that the appropriation of supplies was peculiarly the function of the House; and which, considering that the struggle to establish this principle had lasted half a century, should ever be looked upon as a sacred duty by the Representatives of the People. His second Resolution referred to the power of transferring the surplus of one Vote to provide for a deficiency under another; or, in other words, appropriating balances to meet excesses. The clause which authorized this operation had been first introduced in the Act of 1846. This clause he would speak of as the 29th clause, because this power was contained in the 29th clause of the Act which was laid before the Committee of Public Accounts, and was spoken of, by the witnesses, under that name. With reference to that clause be affirmed these three propositions—that the object with which it had been introduced had never been attained; that it tended to increase the public expenditure, and was otherwise most injurious; and that no inconvenience could result from its omission. The object of this clause was the same as that which Sir James Graham sought in 1832, in order to secure a strict appropriation—namely, to secure to the Treasury a control over the Departments, so as to prevent them appropriating money contrary to the wishes of Parliament. Mr. Anderson had stated in his evidence, that the origin of Clause 29 was the Report of Sir W. Herries' Committee; the intention of which was that—

"Treasury Control might be brought in aid of Parliamentary Control, so as to prevent an excess on any Vote."

This, moreover, had been recommended by that Committee only on the supposition of there being no Committee of Public Accounts to inquire into any excesses upon the Votes. This object had not been obtained. To this every one of the witnesses had borne testimony. Sir Richard Bromley said (153), "My own opinion is, that it (the check of the Treasury) is a mere matter of form, and that it would be better dispensed with." Mr. Arbuthnot (1104–9) stated that "the authority given to the Treasury has degenerated into a mere matter of form." "The Treasury check has not so worked as to be successful in its object." The Duke of Somerset al- lowed (1327) that "the control of the Treasury to deny the transfer is and must be merely nominal." In fact. Colonel Greene (230) did not know any case in which the Treasury have refused to give their absent. The Duke of Somerset continued (1447)—

"The Treasury have, for a great many years, been trying (under Clause 29) to control the expenditure, and keep the Naval Estimates in their right position, but have totally and entirely failed."

Mr. Arbuthnot stated, that the Admiralty "utterly declined to acknowledge the authority of the Treasury," and tried systematically to set the Treasury at defiance. He might mention two examples. The first was the transfer of £250,000, which had been voted for the building of iron ships, to the purchase of stores. The Treasury were never asked for their sanction to this transfer, and never knew of it for upwards of a year afterwards; and at last it was made a matter of mere verbal communication between the present Secretary to the Admiralty and Mr. Laing, who was then Secretary to the Treasury. In the same year the store Vote was exceeded by £424,651; which was also met by a transfer; and here again the sanction of the Treasury was not once asked. Application for leave to transfer was, in fact, never made until five days before the accounts were sent in to the Audit Board, when there remained no longer sufficient time to make any inquiries. Such instances showed that the clause had entirely failed in the object for which it had been framed. He now passed to the second proposition, and would show that this 29th clause, or rather the power of transfer which it gave, had operated most injuriously for the public service. He would show this in six different ways. The clause had a very injurious effect, because, in the first place, the expenditure had thereby been greatly increased. Sir Richard Bromley had, in fact, affixed a stigma to the clause by calling it a mere "cover to expenditure." The power of transfer had been created in 1846, and the Duke of Somerset stated that "the next year (1847) the expenditure exceeded the Estimates by £454,000, thus showing that the balance had been overthrown." Mr. Anderson had referred to the same cause, the well-known fact that the expenditure in 1862 was three times as great as that of 1832. As an example, he might mention that the gun- boat slips at Haslar were constructed and the expenses met by a transfer, and "Parliament was thereby committed to a vast expense without any previous sanction." So also the £12,000 given to the German settlers at the Cape was met by a transfer, having been given without the sanction of Parliament. This had been stated by the Secretary at War on March 9. Secondly, the abolition of the power of transfer, or the expunging of Clause 29, would reduce expenditure. This might be deduced as a corollary from the preceding statement; but he preferred to bring forward independent testimony to substantiate it. Mr. Anderson, who was principal clerk at the Treasury, said (1716) that—

"Whenever you require those great departments to go to Parliament to vote all their deficiencies, you will very much reduce the amount of those deficiencies.

The Duke of Somerset allowed (1400) that "having to come before Parliament for a Supplementary Estimate," would tend to "check the expenditure." But Mr. Gladstone asserted (1636) that "at present there is a power of final adjustment without coming to Parliament at all." And he continued to state that there were many transactions which the Departments would not enter into at all, if they knew that the case must come before Parliament. The reason why the expunging of the 29th clause would reduce the expenditure was very plain; and this introduced the third head—namely, that the power of transfer prevented the Departments coming to Parliament for money; which was another very injurious effect of that clause. The Secretary for War said, that "if the clause were repealed, the Departments would have to go to Parliament for every excess," and added, that "the real check undoubtedly was the vote by Parliament." Colonel Greene stated, that the different Departments always took care to "have a surplus in order to prevent having to go to Parliament." Fourthly, the 29th clause was very injurious, because the system of making transfers tended to produce a laxity in the Estimates; and this laxity in the Estimates produced surpluses and then transfers. These evils thus acted and reacted on each other in ever increasing ratio; and caused an ever-widening circle of vicious expenditure. This had been plainly stated in the evidence, of Mr. Arbuthnot; and Mr. Anderson, had said that the Departments were tempted to make surpluses, and were then induced, by the possession of a surplus, to incur expenditure which they would never incur otherwise; but if no power of transfer existed, and the Departments had to go to Parliament for deficiencies, they would "estimate every service at its proper amount." Fifthly, the power of transfer not only enabled the Departments to avoid coming before Parliament, but also operated most injuriously in entirely defeating the knowlege of Parliament. The Duke of Somerset (1464) said, that "under the existing system, Parliament may vote a vast sum of money for the conveyance of troops, and may find that a large portion of it is spent in stores." Colonel Greene (358) mentioned an instance in which money voted for barracks at Plymouth was spent on works at Hong Kong, which Parliament had never sanctioned, nor even heard of; "so that" to use his own words, "the knowledge of Parliament was thus defeated." And Mr. Arbuthnot (842) said, that payment for salaries might go on without even the Treasury knowing of it. This they did by applying it out of the Vote for Works. Thus, "the Surveyor of Coast Guard Buildings" was an office which was never known of until discovered by accident; for his salary had never appeared in the accounts, but was paid by a transfer from some of the Votes. The Duke of Somerset (1279–1286) confessed that, while Parliament was sitting, the money voted for iron ships was spent in buying timber. He allowed that he "did this on his own responsibility," he "thought it the right thing to do." This line of conduct he had determined on while Parliament was sitting, and yet he had never mentioned it to Parliament. It must be remembered that he had already "taken a Vote, of £722,000 for timber, which was all he could get" from Parliament. To wind up this statement, he confessed that he had determined not to let Parliament know anything about it, as long as "Parliament could take any action." There was also another head under which the 29th clause had operated most injuriously. The Government were induced, owing to it, to ask for a larger sum than they required for certain Votes which were known to be popular with the House; while they took less than was necessary for others which were unpopular; so that the House was by that means actually deceived in two ways:—First, they were persuaded that some much-desired object would receive the advantage which they so profusely granted; and, secondly, they were induced to believe that no more would be spent on some undesirable object than they chose to give. It was well the House should know that it was the practice of Governments to obtain money under false pretences (for he could designate the practice by no milder term). Mr. Arbuthnot, for instance, in his evidence (670, &c.) had said—

"There was a popular Vote obtained for a Naval Reserve, amounting to £100,000; and I apprehend that Parliament would not have placed that £100,000 at the disposal of the Admiralty for any other object.… Not above £12,000 was spent for that purpose;. … and the rest of that Vote was applied to purchasing stores. I do not think it was an honest expenditure."

Again (830)—

"There is one thing to be always guarded against, and that is, taking what I may call popular Votes, and then applying them to services which have not been voted."

And Sir George Lewis (2293) said —

"Occasionally, as one Vote is a little more popular than another, and the House is more likely to agree to some particular Vote than to another, they might make the Estimate a little fuller upon that head, and they might starve it a little upon the unpopular Vote, in the speculation that they would save upon the popular Vote, and turn it over to the unpopular Vote."

While Mr. Gladstone (1577) gave this remarkable evidence—

"The Admiralty, as all those Departments, have a great temptation.…. to allow those surpluses to grow upon certain Votes, in order to form a fund for meeting the deficiencies upon other Votes…. It leads them. … to provide surpluses in the main upon the more popular Votes, and to trust to them for supplying the deficiencies upon the more unpopular Votes."

Indeed, it was quite obvious that the practice of thus taking more than was required under one head, while another Vote was starved, was in itself very reprehensible; yet the evidence of all the leading witnesses who appeared before the Committee went to establish the truth of what he stated. To prove this important matter, still more clearly, he would show it by examples taken from the Estimates and accounts; he would give instances of Governments taking too much on Votes which were popular with the House, and starving those that were unpopular. Vote 1, for Wages of Seamen, was a popular Vote. On such a Vote, surpluses were made by asking more than was required. Now, it appeared from the evidence, that since 1848, with one exception, there had always been large surpluses on this Vote; equal to £2,000,000 in thirty years, of which £1,700,000 had occurred in the last ten years alone, while in the year 1860–1 the surplus had amounted to,£441,411. Vote 3, for the Admiralty Office, was an unpopular Vote. Such a Vote was starved, to delude the House of. Commons; that is to say, less was provided than the Government intended to spend. It appeared in the evidence, that since 1832, with one exception, the Admiralty had always exceeded their Vote; they had exceeded it at an average of £5,000 per annum. And Mr. Arbuthnot stated, that "there is no reason why the Admiralty should not estimate correctly, except the desire to starve an unpopular Vote." And the Duke of Somerset (1229) allowed this to be the true state of the case. Vote 4, for the Naval Reserve, was a popular Vote; that was, more was asked than would be wanted. The surplus on this Vote in 1859–60 was £96,000, and in 1860–1 it was £92,652. Vote 10. for Naval Stores, was an unpopular Vote, and less was asked for it than would be spent. It was proved, that during the last ten years, this Vote had been exceeded by £2,500,000; of which the excesses during the last two years alone had amounted to £1,000,000. Of this, none was attributable to the China war. For the last five years there had been an excess of £100,000 per annum for timber alone; and the excess during the last three years had been at the rate of £500,000 per annum for timber alone, although they were now building only iron ships. Now, Mr. Anderson said, that as all contracts were made at home, this expenditure could easily be correctly estimated. Hence this was a wilful starving of an unpopular Vote, designedly to be met out of other Votes. Vote 11, for Works, was of a mixed character, in part popular, and partly unpopular. With regard to this Vote, it was shown that £77,000 had been, in 1860–1, spent differently from the intentions of Parliament, and £10,000 more had been spent which had never been estimated for. Again, £15,000 had been granted for dredging Portsmouth; but £25,000 had been spent; and £12,000 had been spent for new docks, which had never been granted at all. Similarly, £10,500 had been spent for works at Hong-Kong, which had not been voted by Parliament, nor authorized by the Admiralty, nor sanctioned by the Treasury, nor estimated by any Department, nor even explained by the accounts. On the whole, it appeared in the evidence that, from 1856 to 1861, £5,000,000 had been spent on objects other than sanctioned by Parliament; so that Colonel Greene, the Director of Works, exclaimed, "The whole of the Estimates (for Works) are a series of those sorts of cases of excesses and surpluses." He had, he thought, said enough to justify him in maintaining that the 29th clause was injurious, and that its operation had justified the use of the epithet which he had the other evening applied to it, when he observed that it had "infistulated" our whole financial system. He wished he could make this stigma hang round the neck of the 29th clause, as long as it appeared in the Appropriation Acts. Before passing to the next proposition he would therefore mention some more important evidence on this point. In the second Report, page vi., the Committee stated, that "the witnesses, with scarcely an exception, disapprove of the power as at present existing." The Duke of Somerset (1448) said, that "the Treasury check has totally failed;" and (1489) "everything that has happened since 1846 shows that the course taken has not resulted in what was intended." Mr. Macaulay (2150–3–4) "entirely agreed that the 29th clause should be repealed;" and said (2224, &c.) "the repeal of the 29th clause would effect every object." While Mr. Gladstone (1580), in quoting Mr. Anderson, said—

"Let the 29th clause of the Appropriation Act, first introduced into the Act in 1846, and which unsettles the appropriation of all the grants of the year for the naval and military services, be expunged from the Appropriation Act, which will then be restored to its former state,"

He should next pass to the third proposition which he sought to establish; which was, that no possible inconvenience would arise if Clause 29 were expunged. If some alternative (such as the plan of another Treasury Chest Fund) were thought necessary, let it be proposed by an additional Resolution. He did not himself think it necessary in a financial point of view; although in another point of view it might be most beneficial. For the different Departments were at daggers drawn with the Treasury, and tried to slip from under Treasury control. This scheme had therefore been devised in order to tie them down, and force them under the restraint of the Treasury. This, the House would remember, had been the object sought in framing the 29th clause, but which that clause had failed to attain. To apply to the Treasury for an allowance out of a particular fund, in order to meet deficiencies, was far preferable to the mode of transfer under clause 29. For, when the accounts were made square by means of transfers, there was nothing to attract the notice of Parliament; there was no definite issue placed before the House. While, to apply for the use of a fund, and to give the reasons in writing for that application, and then to come to Parliament for a credit in order to repay that fund, brought a distinct question for discussion before the House. It was, nevertheless unnecessary to resort to this alternative; for, as matters stood, the accounts of the navy were got in eight months after the close of the financial year; then it was discovered that there were deficiencies on some of the Votes, caused partly by imprests at home, and partly by repayments to the Treasury chests abroad. It then became necessary to square the accounts fur Parliament. According to the present system that was done by means of transfers. Now, a transfer did not mean a carrying about of money-bags; it was a mere matter of account, a credit transposed; it made no noise; it was done by a clerk taking the pen from behind his ear and writing a few figures. But, if the 29th clause were expunged, if the power of transfer were abolished, then all the balances (or surpluses) would have to be surrendered, and new credits would have to be voted, to meet the deficiencies and square the accounts. To surrender a balance, it must be remembered, meant merely to surrender a credit, to give up an authority to draw. How, then, it might be asked, could the current expenditure be carried on? The accounts at the pay office were mere current accounts, or cash accounts. Now before the navy accounts were squared they would have procured a new credit at the Bank. The expenditure could therefore be met out of these new credits; all payments could be made out of the navy cash. The only difference would be, that the accounts could not be squared without coming to Parliament for "Votes in excess;" that was, for new credits to clear off those deficiencies. To remove any doubt upon this point, he would refer to the evidence: — Colonel Greene (414) was asked "if he sees any objection in taking away that power of transferring surpluses?" and answered, "No, certainly not." Mr. Vine, the Inspector of the Audit Office, said (473), "I am not aware of any inconvenience to the public service that would arise from it." Mr. Arbuthnot (1117–1120) said, "The transfer is merely effected in the Admiralty books, and is a simple matter of account." The Duke of Somerset argued (1320) that the public payments would not be stopped even if every Vote were exceeded; so that, consequently, if the power of transfer were taken away, there would also be no inconvenience resulting. Mr. Whiffin, Deputy Accountant General, said (1979), "they can meet the expenditure out of the current army cash;" while Mr. Macaulay (2151) said, that "paying the surpluses into the Exchequer will not in the least degree embarrass the different Departments for money." He would compare the services in order to make this evident — namely, the army, the navy, and the civil services. In the case of the Civil Service, each Vote had its own special account in the books of the paymaster; each Vote had its own credit, and its balance was struck every week. When an issue was applied for, it was always specified for which Votes the issue was demanded. The consequence was, that a Civil Service Vote could never be exceeded, the balances at the end of the year were surrendered, and there were no transfers. In the case of the army or navy, money was issued on the aggregate credit; the paymaster knew not for what particular Votes it was issued, nor how the money was appropriated. Yet many of the Votes were for charges at home, and the payments were final payments, as in the Civil Service. The paymaster, in short, was, in the case of the Civil Service, a banker for each separate Vote; while in the case of the army and navy, he was a banker for the whole service; he must honour their draughts as long as they had a credit at his bank (so to speak) sufficient to meet their demands ills accounts were a mere banker's account—a current account—not an appropriation account. But when the navy made up their appropriation accounts, then deficiencies were discovered on some Votes, and surpluses on others. It then became a question how the accounts were to be squared. If it were by transfers, then no definite issue was brought before Parliament; but if the transfer clause were done away with, then the Departments could not square their accounts without coming to Parliament for credits to the amount by which they had exceeded, in their expenditure under particular heads; and there was voluminous evidence to show that no inconvenience could result from such a mode of proceeding. He thanked the House for their indulgence in hearing him on so dry a subject, and hoped that they would bear in mind the propositions which he had proved. 1. That the 29th clause had failed in attaining the proposed object. 2. That it was most injurious to the public service, by increasing the expenditure; by preventing the Departments coming before Parliament; by promoting laxity in estimating; by defeating the knowledge of Parliament; and by causing the Government to take too much on the popular Votes, and starve the unpopular. 3. That, in the nature of things, no inconvenience could result from expunging the obnoxious clause altogether. The noble Lord concluded by moving—

"1. That every Bill hereafter introduced for the appropriation of supplies be printed and distributed in time for consideration before it passes through Committee of the House.

"2. That it is inexpedient that any Bill for the appropriation of supplies shall contain the power of transfer which was first introduced into the Appropriation Act of 1846, and which unsettles the appropriation of all the grants of the year for the naval and military services."

said, he could not concur in several important points with the opinions expressed by the noble Lord He thought the noble Lord had very much exaggerated the effect produced in the augmentation of expenditure by arrangements—certainly in themselves defective — with regard to the fiscal laws of transfer. No doubt the tendency of lax and defective arrangements was to increased expenditure; but he could not agree, as the noble Lord seemed to assume, that the aggregate amount of expenditure had been very largely increased. He differed, too, from the noble Lord on another point, which though not expressly asserted by him, was assumed and taken for granted all through his speech. He gathered from the noble Lord's speech that he was of opinion that in all cases where the Vote on a particular item was exceeded by the expenditure, whether that deficiency was capable or not of being supplied from the aggregate fund voted for the service of the year, it ought to be made the subject of a supplementary Estimate. [Lord ROBERT MONTAGU: Of a Vote of excess.] That, of course, was a very different matter; but still it was a popular and plausible delusion, that if, on any emergency arising, there was an excess of expenditure on the sum actually voted for a particular service, it ought at once to be brought before Parliament in the shape of a supplementary Estimate. From his experience in the office he had the honour to hold, he was persuaded that there was no practice which would be more destructive of Parliamentary control over the expenditure. It had been a matter of regret to him that on several occasions, from very grave and sufficient reasons, supplementary Estimates had been presented during his term of office, but he was firmly convinced that the whole effectiveness of Parliamentary control depended upon the state of the finances— the balance of income and expenditure— being once a year gathered together and submitted as a whole to Parliament— and in a plan being submitted to Parliament which should substantially, and in the main, govern the whole expenditure and income of the year. But, if from any idea of the supreme control of Parliament, the Government were to be called on every week or every fortnight to bring down supplementary Estimates, the control of Parliament over the expenditure of the year would be entirely nullified under the semblance of consulting its dignity. It was impossible for Parliament to give its whole attention to these points, and he held it to be a canon of all sound finance that supplementary Estimates should be few and as limited in extent as possible. Coming next to matters of fact, he was afraid that the noble Lord had not taken into view what had been recommended by the Committee on Public Accounts, and what had actually been done by the Government. To adopt the noble Lord's second Resolution, which was the most important, would be like taking precautions against dangers which had ceased to exist. When the question was examined before the Committee of the previous year, all that the noble Lord had stated to the House was taken fully into consideration. It was felt that the system was defective. The Act of 1846 sanctioned practices which had previously prevailed without any sanction at all; and though the provisions of that Act might be defective, the noble Lord would find that, substantially, the whole of what he had proposed had been adopted under that Act. The power of transfer, in fact, which he described and denounced, no longer existed. A plan had been submitted in the previous year by which certain separate funds would have been established, out of which these excesses might have been temporarily supplied. That plan was not adopted by the Committee, but in lieu of it another plan was adopted. New securities were taken to insure the submission of these excesses to the Treasury, so that the Treasury had greater certainty than it ever possessed before that these excesses would be submitted to it. The matter being thus brought under the notice of the Treasury, it was likewise provided, that although the Treasury, out of unappropriated surpluses, was Authorized to advance sums to meet the deficiencies on particular Votes, yet that such appropriations should be of a purely provisional character, that they should only hold good until the final closing of the account, and that after that closing of the account the expenditure in excess should be definitively met by a Vote in excess. That Vote would not correspond precisely in its technical character with Votes in excess as we now understood them. They referred to excesses properly so called, which entered into the Exchequer account of the year in which they were passed, and materially disturbed the relative balance of expenditure and income. The essence of the noble Lord's Motion, as he understood it, was to bring each transaction on its merits to the judgment of Parliament; so that by the arrangements of the different Departments they might not be prevented coming under the attention of House. That was precisely the object of the clause which had been incorporated into the Appropriation Act. The 26th clause of that Act provided, that where there was an excess of expenditure, on application being made to the Treasury, the Treasury might thereupon be authorized, temporarily, to defray the excess out of any surplus which might have accrued; and it was then provided, that within a given time after the assembling of Parliament, the proceedings should be laid before it for its sanction, and provision be made to meet the several excesses on the several Votes in such manner as Parliament might determine. The criticism, therefore, of the noble Lord was directed to a state of things which no longer existed, and he was endeavouring to provide a remedy for that which had already been cured by Parliamentary proceedings. Unfortunately, it was impossible, in the varied expenses of a great country like this, for every Department to know exactly the precise amount of its expenditure, and it was necessary that some slight margin should be left. It would be most undesirable to say to each Department, "You must take into account, in framing each particular Vote the extremest amount which you can possibly require, and call on the Chancellor of the Exchequer to provide for it out of the income of the year on a scale which will cover all emergencies." With regard to the noble Lord's first Resolution, of course it was very proper that the Appropriation Bill should be accessible to Members, but he scarcely thought it desirable to go to the expense of from £50 to £100 for printing 658 Bills, of which, perhaps, not a dozen would be used. The principle of the noble Lord's first Resolution was sound; and if he would take it in the following terms, he should have no objection to its being adopted: —

"That a sufficient number of Copies of every Bill hereafter introduced for the appropriation of Supplies be printed and delivered to Members applying for them in time for consideration before it passes through Committee of the Whole House."

With regard to the second Resolution, he had endeavoured to point out that the object at which it aimed had already been obtained.

said, he was Chairman of the Committee on Public Accounts which sat during the last year, and the House ought to be made acquainted with what had taken place. No doubt changes in the Appropriation Acts had been made without the knowledge of the House, and it was proper that hon. Members who paid attention to these subjects should have the opportunity of seeing the Bill in print before it was passed. There had been great looseness in the matter, and it was necessary to put a stop to that looseness. The Committee over which he presided considered several plans, and at length came to a decision to make recommendations, which the Government had adopted, and which he believed carried into effect all that could be reasonably wished. In future the sanction of the House was to be obtained for the appropriation of any excess in any one Vote to another Vote, in whatever Department the excess arose. He could not see the use of passing a Resolution to do that which had been done already, and he warned the House against interfering with the transfer clause. Under the old practice the Admiralty of itself, transferred the excess of one Vote to another Vote, but a change was made by which the sanction of the Treasury was required. If they repealed the transfer clause, the Admiralty would get rid of the check of the Treasury. What the noble Lord wished was to increase the check, and the Committee recommended them to strengthen it by adding the necessity for the sanction of the House. Under these circumstances, he hoped the House would not come to a Resolution which would entirely upset the plan of the Committee, and would abolish a valuable means of keeping the different Departments in order.

asked whether the noble Lord accepted the Amendment of the Chancellor of the Exchequer?

said, that he did.

said, he was friendly to the publication of all the Acts of the House, and therefore he should support the principle of the first Resolution. But it did not go far enough. He wished the Indemnity Bill as well as the Appropriation Bill to be printed. The Indemnity Bill ought not only to be printed in the folio edition of the statutes, but that, as the greatest part of the expense of setting the types must be incurred, copies should be supplied to any Members who required them. It was a reflection on the House to be passing a Bill every year indemnifying persons from penalties for not taking an oath against the Pretender.

said, he must call the hon. Member to order, as he was not addressing himself to the question before the House.

said, he would move as an Amendment that the Indemnity Bill be included in the first Resolution, and then he should be in order in referring to that Bill. He protested against the House being made ridiculous by passing Bills which excused even those who passed them—including the Law Officers of the Crown—from the penalties incurred by a neglect to make unnecessary and ridicu- lous declarations, the ground of such excuse being that they did not know the law.

said, that the chief argument which had been brought against him was that a change had been made last year in the transfer clause, which clause the Chancellor of the Exchequer had denominated "an evil," and which this change had "cured." The change which had been referred to might be an improvement, but they had no experience flow it would work, and no security even for its continuance. At any time they might return to the old system without the cognizance of the House. But as it was agreed on all sides that the clause had failed in its object, and was an evil, he must express his astonishment at the desire which was evinced to bolster up a bad cause. He would, however, consent to withdraw his second Resolution. The Chancellor of the Exchequer had assumed that he (Lord Robert Montagu) wished him to comedown to the House "every fortnight" to adjust the accounts. He meant that this should be done once for all, when the accounts were closed. The Chancellor of the Exchequer had objected also that "a Vote in excess entered into the account of the year in which it is voted." This was true of a cash account, but it would not be thus in the case of service accounts, such as those of the army and navy. He should withdraw the second Resolution.

said, he wished to remind the House of the offer of the Secretary of State for War to furnish the detailed accounts of the army expenditure, if they were moved for. He wished also to appeal to those hon. Members of the Committee who had said that there was no objection to their being presented, to say whether further examination confirmed them in that conclusion, because if they were to check the power of transfer, which had been abused, they must have before them the detailed accounts of the expenditure of the army for the past year when they were dealing with the Estimates.

said, he rose to move an address for Returns of the names of the persons killed or injured during the procession of the 7th of March and on the occasion of the recent illuminations in the City on the 10th of March, and of persons who afterwards died in consequence of injuries received on either of those days; and of the persons injured on either of those days whose cases were reported to the City and metropolitan police, distinguishing the localities in which the deaths and injuries occurred. The difficulties which arose in the City, upon the occasion of the procession of his Royal Highness the Prince of Wales and the Princess Alexandra, were unhappily matters of public notoriety. Under the circumstances the fatal accidents to which his Motion referred, ought not to have occurred; for if ever proper notice was given to authorities, it was given on that occasion. For several days, previously to the 7th instant, the City had been engaged in mailing the most extensive preparations for the Royal reception, which attracted such crowds of spectators that the streets were almost impassable, so that there was ample warning of what was to be expected on the day of the arrival of the Princess. Besides, notice was given from a quarter which ought to have received deferential attention. They had the statement of His Royal Highness the Commander-in-Chief, that he had tendered the Lord Mayor the assistance of the military, which was in the first instance declined; but when the Commander-in-Chief, fortified by the opinion of a council of officers, again pressed the use of the military on the Lord Mayor, his Lordship accepted the aid of a limited number of mounted artillery. If he had not done so, the most fearful consequences would probably have ensued. But as it was, the City authorities could not be held to be tree from blame. They arranged the programme and published an order for the clearing of certain streets at stated times; but long after the fixed hour the streets were encumbered with vehicles of every description in defiance of their own regulations. There was an appalling scene at London Bridge, which was crowded long after the hour that had been, fixed for clearing it, and there was great anxiety as to the possibility of making a passage over the bridge for the Royal procession. So densely were the people massed in front of the Fishmongers' Hall that it was wonderful some were not crushed to death, and it was a grave question where the people on the bridge were to be forced to. A. few policemen, who had been placed on the bridge to perform an impossible task, made an attempt to clear the bridge, but failed hopelessly; and when the duty was undertaken by the mounted artillery, the result was to drive an immense mass of human beings on to the already overcrowded spaces opposite Fishmongers' Hall, along King William Street, and before the Mansion House. The City procession then began to make its appearance, getting through the crowd as it best could; but only part of it crossed the bridge; and when the Royal carriages reached the centre of the bridge, they could get no farther for some time, because the corporation carriages, advancing to meet the Royal carriages, stopped the way. All that showed great want of precaution on the part of the City authorities, and at the same time evidenced in a remarkable degree the good conduct of the people, and they could only be thankful that the number of fatalities was not larger. Had there been evil-disposed persons in the crowd, or had the police displayed anger or irritation, much more serious consequences might have been apprehended. Several lives, however, had been sacrificed and limbs broken, and it was well worth inquiry how these grave accidents had occurred. In King William Street, on the Saturday, a woman had been thrown down from a stand which had been improperly erected there; her arm was broken, and she was removed to an hospital, where she subsequently died; and it was on account of that case he had introduced the 7th of March as well as the 10th into his Motion. The public mind had been painfully excited on the subject, and he thought it must desirable that all the facts that could be ascertained should be laid before the House previous to the discussion on the Motion of the hon. and gallant Member for Westminster (Sir De Lacy Evans) for the amalgamation of the metropolitan and City police; so that the House might have correct data upon which to form an opinion.

said, he rose to move that the Return be supplemented by a Return of the number of persons killed and wounded on the occasion of the lying in state and funeral of the Duke of Wellington; and a copy of any order issued by the metropolitan police authorities with a view to prevent such accidents. He moved that addition because he thought that the information furnished, to be of any value, should be as full as possible, and he hoped that the House would suspend their judgment until they obtained full information. As the hon. Member, however, had given a detailed account of what took place in the City, he might, perhaps, be permitted to say that the great blunder which had been committed was that of confining the full procession to so limited a line of road as that which existed between London Bridge and Temple Bar. Another fact which he would mention was this—that on the morning of the 7th March he attempted to approach the Mansion House from the north of London; but when he got as far as the junction of Newgate Street, and St. Martin's le-Grand, his carriage, those of other people, and a great many respect able persons on foot, were prevented getting into Cheapside by van-load after van-load of metropolitan policemen being driven from the West End through the City of London; and an obstruction of that kind having occurred, it was certainly right to inquire how far the metropolitan and the City police authorities acted in harmony upon such occasions. When one body of police was found fault with, and another was found adding to the obstruction, the House ought to suspend its judgment until the whole of the facts were before them. If it could be proved that the City authorities had neglected their duty, they ought to be called upon to resign the authority which they possessed.

said, he thought it would be inconvenient upon that occasion to attempt to answer the observations of the hon. Member for Marylebone; but when the Returns had been furnished, the whole circumstances would be in possession of the public, and they would then be able to judge of the merits of the question. He might, however, be allowed to repeat what he had stated before, that troops having been offered to him, he accepted that offer on the very day on which it was made. There was, however, some little irregularity on the part of Sir Richard Mayne in communicating the offer. Such offer was made in an unofficial manner; but the moment the offer was officially made, he at once accepted it verbally, and within two hours a written acceptance of the offer was sent to His Royal Highness the Commander-in-Chief, and that letter also thanked him for the offer so made. Further, when two officers were sent down to him (the Lord Mayor) he not only expressed his gratitude for the 200 troops who were offered, but said that if 100 or 200 more could be sent he should be thankful.

said, he wished to know whether, when his gallant Friend Sir Richard Airey first made an offer of to the Lord Mayor, on behalf of His Royal Highness the Commander-in-Chief, he did not meet with a refusal.

said, that he most distinctly stated that personally he was very much obliged to His Royal Highness for his kind consideration, but that he being the occupant of his office for one year only could not accept the offer off-hand; that personally he accepted it, but that a written communication would be sent as soon as the proper parties could be consulted, and that written communication was sent, he believed, about an hour after the interview by special messenger.

said, he thought that was not the time to discuss the arrangements of the City Police. It was quite obvious, however, that that force was quite insufficient to meet the recent emergency. He had not seen the report referred to by the Lord Mayor, but had no doubt he would find it at the office on the following day. He had no objection either to the Motion or the supplement to it.

in rising to move the second reading, said, the Bill contained a considerable number of provisions, but the main one was intended to extend the principle of limited liability to private partnerships, and to enable clerks to share in the profits of a concern without incurring the liabilities of partners, or acquiring the rights of partners. There were also clauses introducing the principle of arbitration into partnerships, where arbitration clauses did not already exist; and, finally, there were provisions for registering the names of parties not already mentioned in the titles of the firms to which they belonged. The Bill contained so many different provisions that it had provoked hostility in various quarters; but he might say at once that he regarded as its leading principle that which related to the limited liability of partners. No one would deny that contracts, whether of partnerships or anything else, should be as free and un- restricted as possible, excepting where they were immoral in themselves or adverse to public policy, or where they were so susceptible of fraud that it would be better to refuse than to admit them. Nor was he then called upon to defend the principle of limited liability, for it had already been sanctioned by Parliament, and was, in fact, part of the law of the land. He merely had to advocate the application of the principle to private partnerships. At present, if a capitalist wished to assist a relative, a deserving clerk, or an inventor, there were only two modes by which he could do it. One was, by lending money at a fixed rate of interest; and the other was, by becoming a partner of the person whom he desired to befriend. If he lent money at a fixed rate of interest, he might not be tempted by the amount which he would receive; or if he obtained a satisfactory amount, it might be far too heavy for the business to bear, especially if the business were one of fluctuating profits. On the other hand, by becoming a partner in the concern, he made himself liable to his last acre and his last shilling. Few men were disposed to run so great a risk, and the consequence was, that a great deal of capital which would otherwise be introduced into commercial enterprises, and so brought to the aid of men of intelligence and perseverance, now went into other speculations, many of them in foreign countries, which were thus enriched at the expense of our own. The present Bill was meant to obviate that difficulty. Its object was to enable any capitalist, if he felt so disposed, to advance a fixed sum of money to a private partnership, becoming a limited partner in the concern, liable only for the amount he had placed in it. That facility, however, was accompanied by stringent provisions of registration, and the registration would give the names of all the partners, limited as well as unlimited, showing the amount of money which each limited partner had put into the concern, and stating the conditions upon which, and the time for which, it was advanced. It would afford, in short, all the information which creditors had a right to ask. The name of the limited partner would not be mentioned in the title of the firm, and he would not be liable to bankruptcy; but of course it would be different with the general partners, who would be liable to their last farthing. He need hardly say that the subject of limited private partnerships was not a new one to Parliament. So long ago as 1782 an Act had been passed in Ireland, the object of which was precisely the same as that of the present Bill. In 1836 the right hon. Baronet the Member for Portsmouth (Sir Francis Baring) prepared the heads of a similar measure; and in the following year Mr. Bellenden Ker, in a Report drawn up at the request of the Board of Trade, admitted that the system was in most successful operation throughout the Continent. Two high authorities—Lord Overstone and the first Lord Ashburton—gave evidence on the subject before a Parliamentary Committee in 1844, the first objecting to any change of the law, and the second expressing himself as, upon the whole, favourable to limited liability, on the ground that it would bring out a great deal of capital now lying dormant or sent to other countries. In 1851 another Committee recommended that power should be given to lend money for periods of not less than twelve months, at rates of interest varying with the rates of profits, the lender not being liable beyond the sum advanced, and proper precautions being taken against fraud. The Mercantile Law Commission in 1853 was divided in opinion, the majority deciding against limited liability partnerships, but three of the Commissioners— Mr. Baron Bramwell, Mr. Anderson, and the hon. Member for Bridport—declared themselves in favour of limited liability, and signed a separate Report to that effect. In 1854 the House, upon the Motion of the hon. and learned Member for Plymouth (Mr. Collier), affirmed a Resolution declaring that the law of partnership which rendered every person who, though not ostensibly a partner, shared in the profits, liable for the whole debts of the partnership, was unsatisfactory, and ought to be so modified as to permit persons contributing to the capital to share in the profits without incurring a liability beyond a certain limited amount. Such was the decision of the House in 1854, and the Bill which he then submitted to their consideration was really founded on that Resolution. The present state of the law on the subject did not rest upon any statute, but on a decision of Chief Justice Eyre in 1793, which was impugned by men of great eminence, among whom were Mr. Baron Bramwell, the right hon. Gentleman the Member for Calne (Mr. Lowe), and Mr. Rickards, counsel to the Speaker. Mr. Stuart Mill, Mr. Senior, and other distinguished economists, also advocated this principle; the whole consti- tuting a sufficient weight of authority to justify him in claiming a favourable consideration for his proposal. The system of limited liability was, moreover, in operation on the Continent of Europe as well as in the United States of America, and it was favoured by some of our most eminent legal societies, and supported by a great number of the chambers of commerce, though he was sorry to say not by all, one of the exceptions being that of the city of Glasgow, whose objections would be stated by the hon. Member for that city (Mr. Buchanan). If the House should be pleased to agree to his Motion, he would ask that the measure be referred to a Select Committee. He begged to move that the Bill be now read the second time.

Sir, the Bill before the House should have been divided into two or more Bills, as it contemplates several distinct and separate objects. The most important of these is the extension of limited liability to all partnerships, and the other next in importance, is the registration of partnerships. It would have been desirable to have had an opportunity of discussing these subjects separately, as many who approve of registration of partnerships are opposed to the extension of limited liability. This appears evident from the Petitions which have been presented to the House. It might, therefore, be a desirable course to refer the clauses of the Bill, as to registration, to a Select Committee. It would then be found what are the practical difficulties to be overcome, whether it is possible to define a partnership with sufficient clearness, whether partnerships for special purposes and for short periods should be registered, and whether the trading of the poorer classes should be burdened with the cost and trouble attending registration. All these are matters of detail, and if there is no objection to the principle involved, might with advantage be left to the discussion of a Select Committee. But I object to adopting the same course in regard to the more important part of this Bill, which proposes to extend the principle of limited liability, by making it permissive in all partnerships. Objecting strongly to that proposal, I have thought it only fair to those hon. Members who may agree with me, as well as to the numerous mercantile bodies who by petition or otherwise have expressed their hostility to the Bill, to move an Amendment, which will at least produce discussion, and test the opinion of the House. I am sure that the hon. Member for Birmingham, whose judicious and practical course in this House no man more appreciates than myself, will not regard what I have proposed to be discourteous, more particularly as it coincides with the advice and deliberate opinions of various commercial bodies whose sentiments are entitled to great consideration. I have had the honour of presenting a petition from the Chamber of Commerce of Glasgow, objecting to the extension of limited liability; the Chambers of Commerce of Halifax and Hull have followed the same course; and the Associated Chambers of Commerce at their recent annual meeting, held in London in February, have also condemned that principle. I shall not notice the various steps which have been taken with a view to alter the law of partnership, by introducing limited liability previous to 1853; and I refer to the Report of the Royal Commission appointed in that year, principally because it contains the most valuable arguments and facts bearing on the subject, and may be regarded as a text book of the theory and practice of limited partnerships. The Commission consisted of eight Members, all of them men of high position, and legal or mercantile experience. After examining much evidence contained in written replies to queries circulated by the Commission among leading statesmen, lawyers, and merchants at home, and having also communicated with merchants in foreign countries, they came to the conclusion, by a majority of six to two, that it was inexpedient to change the law of, partnership. But this decision did not abate the ardour of the supporters of limited liability. In 1855 a Bill was introduced on the Motion of the right hon. Gentleman the Member for Kilmarnock, on behalf of the Government, and became law, enabling joint stock companies to be registered with limited liability. A further step in the same direction was made in 1858, when banking companies were enabled to avail themselves of the same privilege. In regard to that legislation, it is not my intention to say a single word, either in approval or condemnation. The wisdom of Parliament has sanctioned, and in the recent consolidated statute has deliberately re-enacted, the principle of limited liability in regard to joint-stock companies and banks We are now asked to take a much more important and more perilous step. We are asked to permit this limitation of liability in all partnerships, by adopting the French form of commandite companies. It is therefore high time to inquire what has been the success of our experiments hitherto. And first of all, have we had sufficient time to judge of these statutes, which have only been perfected by the consolidated Act of last Session, and exist on the statute book only eight and five years respectively? There has not, therefore, been a long experience of this new principle in our mercantile law such as to justify a further advance in the same direction. But it may be said —Has there been any marked success at all? Has public opinion sanctioned the change of the law by any distinct and unanimous expression? If there really had been a general agreement in favour of limited companies, there would be sufficient proofs of it in the general adoption of the system. Three Returns in regard to limited companies, have been presented to the House, the first and last on the Motion of the hon. Member for Argyllshire, and the second on the Motion of the hon. Member for Lancaster. By the first of these Returns it appears that during three years, from the 17th July 1856 to the 29th July 1859 (omitting the first six months after the Act came into operation), 1,010 joint-tstock companies were registered in England, or 336 annually; and during the same period 290 of these companies were abandoned, or nearly one-third of the whole. During the period embraced by the second Return, two years and a half, there were registered 901 companies, and 73 abandoned; to which must be added the abandonments in a supplemental list, coming down to 1862, and amounting to 214 additional, making 287 companies abandoned, of 901 registered, or considerably above a third. The last Return is for the year 1862, during which period 423 companies have been registered, and 61 abandoned, including a supplemental list of companies previously returned. Similar Returns applicable to Ireland and Scotland have been presented, and give nearly the same results. In seven years the whole number of companies registered in England has been 2,334, and of these 638 have been abandoned, or something approaching to one-third of the whole number. Any one who considers the enormous extent of English commerce will admit that these figures are significant, and indicate no great desire on the part of the public to enter into such companies. The great boon of limitation of liability seems so far to have been little appreciated. As regards banks, the Returns are even more suggestive. Since the passing of the Act, in 1858, only nine banks have been registered with limited liability, and of these one has been abandoned. None of the old-established banks have availed themselves of the privilege, so far as the Returns show; but it is understood that two banking companies one at Manchester and one at Liverpool, have recently been reconstituted on that principle. During 1862 thirty-six banks have been registered, many of them quite recently, and as to all we have only a short experience. Again, it may be asked, where is there any proof of public anxiety for limited banking companies? Colonial banks incorporated by charter and with special conditions of liability (generally twice the amount of shares) are not included in these remarks. Of the 2,334 companies registered, 638 have ceased to exist, dissolved, wound up, and many of them bankrupt. It is to be regretted that the Returns before the House contain no records of the winding-up of these companies in the courts of law. It is believed that in many cases they would present examples of reckless mismanagement, and not unfrequently of swindling. In all of them it will be found that debt has been freely incurred, and that the dividends for distribution among creditors have been small. The hon. and learned Member for Guildford, whose great experience in the courts of law entitles his opinion to much weight, said, in the debate on the 13th May, 1858 —

"In the cases [of limited liability companies] which had come into the courts, it had generally appeared that all the money which had been paid up was spent, and that there was nothing for the creditors."

No doubt, subsequent experience has been of the same kind, though, so far as I know, not attested by the same high authority. If current rumours are to be trusted, the disclosures made in the winding up of these companies continue to be disgraceful. All these facts afford no encouragement to extend this system. The advocates of this Bill are bound not only to show that so far there has been success in the work- ing of their principle, but that such success has been marked and decisive. The burden of proof rests with them; they must establish a success which warrants a farther advance in the same direction, and we ask for facts to justify that course. But it is said, limited liability and commandite companies have worked well in other countries. I confess that I have been unable to find any conclusive proof of that great success; at least, it is not to be found in the evidence laid before the Commission of 1853. France has been mainly relied on, and the forms of the French law have been imported into this Bill But, let any one go over the evidence, and he will find that instead of a history of great success, we have only apologies for non-success from the principal French witnesses. They have told us, not that the commandite principle has succeeded, but that it has been abused. Even the hon. Member for Bridport, who was one of the Commissioners and reported favourably of the French law, does not deny that it has been abused, and that the practice of mixing up the two different principles of sociétés anonimes and en commandite ought to be abolished. I cannot do better than refer to the summary of this part of the argument in the Report of Mr. Slater, one of the Commissioners, which will be found at page 44 of the Report. To the same effect Mr. M'Culloch has written in the late edition of the Encyclopoedia Britannica (article "Partnership"). It is alleged that in America the success has been great, but the testimony to that effect is not unanimous. Sir William Brown, well known and respected in this House, Messrs. Haven and Curtis, of Boston, Messrs. Biddle of Philadelphia, and Binnie, an eminent American jurist, all agree as to the frequent abuses resulting from sociétés en commandite. To the same effect is the testimony of Mr. M'Culloch, in the article already alluded to. From Holland and Belgium also we have conflicting testimony as to these societies. In all cases there is an admission of abuses, and numerous proposals for remedy. Again, it may be asked, are these evidences of success sufficient to warrant us in following these foreign examples? Do not tell us that the principle is a good one, but has been ill-worked. You ask us to adopt a new law, and on you lies the proof that it has elsewhere succeeded. Your argument requires that you should have not partial, but great, and even bril- liant success. I confess, I do not know where such proof is to be found. From anything that appears in evidence, at home and abroad, we are not warranted in making further changes in our law. It is merely to carry out a theory that we are asked to adopt the Bill. The Legislature has sanctioned the principle of limited liability in recent statutes; and in order that there may be uniformity in our laws, all partnerships are to be brought under the same category. But that is not a practical argument. In many cases it may be right to go a certain length, and quite wrong to go further. It remains for those who demand a further change in the law, to prove that they are recommending a safe course. But further it has been said, why should parties be restrained from forming any contracts which they may deem for their interest? If the conditions are avowed, and contemplate a legal object, there should be no impediment to such contracts. Interference and restraint are contrary to the principles of freedom recognized in recent legislation. No one has put this argument with more clearness and power than the right hon. Gentleman the Vice President of the Board of Education, who says, at page 84 of the Report—

"The only case in which the State is justified in prohibiting parties from contracting, is where a contract arises out of a breach of law or morality, as gambling, or is made for the purpose of a future breach of law and morality, as smuggling, or is in itself a breach of some other substantive law, as insuring an enemy's ship. I can find nothing against morality, nothing against public policy, in the legal sense of the word, in contracts of limited liability; and as to whether such contracts are advantageous to those who enter into them, afford facilities for fraud, tend to impair the credit of the concern, or encourage unhealthy speculation, I think we may fairly leave individuals to judge, without State interference."

This argument is carried too far when it assumes that the State, as guardian of the public interest, is under no obligation, in so far as just and equal laws can accomplish it, to prevent fraud. It is much the same as if it were maintained that the State is not bound to prevent larceny. The great principle salus populi, summa lex, requires that the freedom of the subject shall be restrained in various respects. All law is a system of restraint. A man may not scatter firebrands, nor randish deadly weapons, nor sell poisons; neither ought he to be allowed to make contracts manifestly affording facilities to fraud. In the opinion of the most competent authorities, the further extension of limited liability would produce wholesale swindling. If so, the State is not only bound to afford no facilities, but to resist to the utmost whatever may lend to such consequences. Of course, the weight of this argument will depend on the proof that limited liability tends to encourage contracts of a collusive and fraudulent kind, and that will be attempted to be shown. In the mean time, I may say that the great objection to such companies, their inherent and ineradicable defect, is that they open a wide door to fraud. Even the hon. Member for Bridport, in his able and valuable paper in the Appendix to the Report of the Royal Commissioners, has guarded his statement of the general principle that there should be perfect freedom in contracts, by the notable reservation, "guarding against wilful deception." If wilful deception could be guarded against, this Bill would stand in a better position, but the proviso of the hon. Member cannot be made effectual, and his whole argument is consequently undermined. As has been already said, the Bill before the House has adopted the principle of the French law of commandite. The third clause shows what is the nature of the proposal. Any company consisting of two or more persons, may be registered as a limited company. Two persons, of whom one shall be the general partner—the gérant of the French law—and the other the special partner, or commanditaire, upon complying with certain conditions of publicity, as narrated in Clause 4, may demand of the Registrar of Joint Stock Companies, to be registered as a limited company. It may seem an extreme case, but it is not improbable, that two persons might form such a partnership; the one possessed of capital, the other of skill. If the capitalist should pay up the capital to be registered (though for the actual payment there is no security), it would be known to the world; but as to the general partner, there is no certainty that he shall have paid up or be possessed of anything at all. These parties might proceed to trade, to contract debts, to divide profits, whether earned or not. and finally become insolvent, leaving nothing for their creditors, though their debts may have exceeded the amount of their registered capital twenty times over, and the nominal profits which have been drawn out be more than the original stock of the company. It must be manifest that such a law would afford the temptation and the opportunity to fraudulent and collusive contracts among partners—to a system of false valuations and dishonest accounting, rendered easy, as every practical merchant knows, by the difficulty of appreciating mercantile assets, scattered over the world. The first marked distinction beween the existing law of limited joint-stock companies and the commandite companies to be formed under the present Bill, consists in the different objects which they respectively contemplate. Hitherto, limited joint-stock companies have been usually registered for purposes of public advantage, as the supply of water, gas, public parks, canals, or undertakings of risk and magnitude, beyond the reach of private enterprise. If the Returns on the table are consulted, it will be found that such has generally been the character and objects of these companies. The present Bill holds out no such pretence; private gain is the only object. Whatever indulgence or relaxation of the law it may have been considered expedient to make in the public interest, no similar favour should be shown to private speculations. Farther, seven partners are required by the law to be associated in a limited joint- stock company. Two partners, one of whom may be a man of straw, may constitute a partnership under this Bill. The difference is important, for seven men cannot combine to defraud their creditors with the same facility as two. The joint-stock companies were required to make their proceedings public. The amounts of capital subscribed, and the amounts paid, were specified and registered. There was a periodical audit provided to be made by neutral auditors, and skilled accountants scrutinized the balance-sheet before profits could be declared. All these precautions in the public interest are to be abandoned. There is to be no published statement of the whole capital account, much less of the items of which it is composed, whether of cash or goods. There is to be no means of knowing whether the limited capital, which is registered, has been actually paid up. There is no provision for a scrutiny of accounts before profits are declared; even an ordinary balance by the partners is not enjoined. For anything that appears to the contrary in the clauses of the Bill, alleged profits may be divided without being earned. If subsequent losses occur, there is no provision for making up the capital to the amount registered by the special partners, so that the register itself may become a snare, instead of a guide to the creditors of the company. On all these points, I cannot do better than quote from the Report of the Commissioners; and I shall briefly refer to the opinions of Lord Overstone, than whom there can be no higher authority; of that acute and learned Judge Lord Curriehill, one of the Commissioners, besides several Members of this House, whose opinions I quote, both as having an opportunity to correct me, if I shall mis-state them, and as being generally opposed to my views. Lord Overstone's opinions will be found at page 96 of the Report. The quotation from Lord Curriehill's Report is at page 17; the hon. Member for Calne, page 84; the hon. Member for Manchester, page 100; and the hon. Member for Peterborough, at page 102. With these high authorities, we are entitled to say that any Bill should be rejected by this House which neither requires the publication of the whole capital of a company nor provides machinery for audit of accounts or the replacement of lost capital. One point may be noticed, though in itself of little consequence. The French law prevents the special partner from interfering in the management of the commandite company. The provision is of little value, in so far as it is impossible to prevent the co-partners from holding unofficial consultations which might equally control the gérant as direct interference. But the principle of the French law is good, in so far as it is meant to prevent a partner with a limited risk from sporting with the funds of the company. But even this safeguard, imperfect as it is, has been omitted in this Bill. Nay, what is still worse, the special partner is not prohibited from signing the firm of the company. For anything that appears to the contrary, he may commit his co-partners by word or writing to any extent, while he himself incurs a limited risk only. The only safeguard proposed by the Bill against acts of management by the special partner is that his name shall not appear in the firm. Farther, the trading of individuals for their own account, frequently the most prudent and efficient trading, is placed at an unfair disadvantage by being exposed to the reckless competition of limited companies. But it will no doubt occur to many, why should this be so? If two partners, one of whom may be a man of straw, may trade limited, why may not an individual also announce that he has registered a limited amount of his capital, which alone will be available for his trade debts. True, this is an argumentum ad absurdmn, but consistency requires that the advocates of this Bill should draw a clear line of distinction, by showing wherefore one man should be debarred from a privilege which is claimed for two men, though in both cases there may be but one capital. Before quitting the specific proposals of this Bill, it may be noticed, that its framers have disregarded the recommendations of the Law Amendment Society. That society has recommended that the capital, no doubt the whole capital, should be paid up, though how that is to be ascertained is not very obvious. No portion of the capital may be withdrawn, though profits may be paid out, and the special partner may not sign the firm, make contracts, or engage or dismiss servants. None of these securities against abuse are to be found in this Bill. It may be said that those who object to this Bill should do so on special grounds, but that no general argument against limited liability is admissible, seeing that principle has been already adopted by the Legislature. It should be borne in mind that the present proposal is of a very comprehensive character, embracing all partnerships of whatever kind, and seeking to introduce a principle hitherto untried save in special and exceptional cases. It is therefore not only quite fair, but necessary to argue the question in all its bearings. In taking that course we cannot pass over those arguments which are relied upon in support of the principle. In the first place, it is said that limited partnerships would tend to utilize capital and bring forward those dormant stores which timid men will not employ in trade exposed to the risks of the present law. But that argument is of little weight in a country like this, where capital is not only abundant, but in excess. In various foreign countries there may have been a necessity for stimulating the application of capital to trade. Commerce was a sickly plant, and there was no confidence in her operations. It requited some limitation of possible loss to induce timid men to expose their property to what were held to be most formidable hazards. But among ourselves such a necessity has never been recognised. Capital has always been abundant for the legitimate objects of trade, and is now more abundant than ever. Let it not be supposed that it is necessary to develop the trade of the country; so far from that being required, a less rapid expansion and development might be-desirable in many departments. In all branches of trade the tendency not casual and variable, but normal and uniform is to overtrading. Take, as an instance, the great cotton industry of the north. If all the wheels of Lancashire were again revolving, the consuming power of the world, so far as it has been tested, would not suffice to take off the produce. Capital flows into the channels of trade with no feeble stream, and our policy at the moment seems to be to restrain rather than stimulate the supply. Another argument for this Bill is addressed to our compassion and generosity. It is said that young men of character and ability, as well as inventors in the arts, would find patrons willing to assist them with limited capital who do not find such supporters under the existing law. The argument is more specious than real. At no time since Britain was a trading country has there been a greater demand for the talents and energies of qualified young men, nor was there ever a greater certainty that such qualities would meet a due reward. No doubt, ardent youths, unwilling to achieve success in the old paths of industry and patience, might at an earlier period enter on the responsibilities of business. But it is most questionable whether the public benefit would be promoted by such a change. The weak point in limited partnerships is, that they encourage rash and speculative trading, and for such enterprises young men, of all others, are the least qualified. The great and most important objection to this Bill is, that it proceeds upon a principle utterly subversive of the law of the country, recognised in innumerable decisions and enforced for many centuries, that every man shall be liable to pay his debts in full. It is said, indeed, by speculative writers, that unlimited liability for debt is not founded on any principle of law, but has been based on the dicta of the Judges. It is needless to inquire into a matter so little practical, as there cannot be any doubt that the English law for centuries has made a debtor liable for his whole debts both in purse and person. But especially is it just that there should be full liability for partnership debts. These are contracted for the benefit of all the co-partners, and thence there arises an equitable obligation that they should be discharged by the joint means and property of all. But while equity clearly points to all the participants or expectants of gain as bound to meet loss, the same principle of equity refuses to sanction any right to devolve such loss on creditors, or, what is the same thing, on the general public. Limited liability is most inequitable in this respect. Lord Overstone, in his paper on limited liability, anno 1837, most justly says—

"In the case of the insolvency of a concern, it removes a portion of the loss, which must be borne by some party, from those who have voluntarily engaged in the concern, and who have had the means of watching and controlling its progress, and who would have been the sole participators in the benefits of its success; for the purpose of throwing it upon those who have had no means of insight into the state of the concern, nor power over its management, and no share in its advantages."

If commerce could be carried on without loss, there would be no harm in limited liability, but occasional loss being as certain a condition of trade as average gain, why should those who derive the profit not bear the loss? And seeing losses must occur, there can be no advantage in shifting them from the shoulders of the rich to those of the poor; for it may be assumed that poor and struggling tradesmen, compelled by the necessities of their position to give credit and run imprudent risks, will generally be the creditors of limited companies. But I would ask further, where is the equity to merchants as a class in thus sanctioning an invasion of their proper domain by an array of outside competitors? The lawyer or the physician would not like his gains to be shared by any other. His long training, his intellectual acquirements, are all his own. But in the case of the merchant or trader, will it be said that there is no peculiar training, no special aptitudes— the result of labour and effort, requiring powers as distinctive as any other profession, and which only those trained in that school usually possess? Where, then, is the equity of opening up the counting-house or the factory to non-mercantile adventurers? By all means let those become traders, but let them run the risk of trade. The law is not bound to place them in a position for which they are not fitted, and secured by protection which involves injustice to others. The worst result of limited partnerships will be found to consist in the wholesale immunity which they afford from the legal consequences of debt. It has been said, these companies will tend to the establishment of a system of cash payments, and the abandonment of credit. There can be no greater delusion. Whether we argue on theory or facts, we shall find the very opposite result to be established. Such companies, in their very nature, imply a system of credit. Where there is no debt there is no liability, and no need for legal protection. And, in point of fact, we know that such companies ask and obtain credit with the utmost facility. If the Returns before the House are consulted, there will be found ample proof of the extent to which they have obtained credit, as well as how they have abused it. Doubtless, prudent dealers should refuse to give credit to those who avow that they will be influenced by no honourable considerations and no principles of justice, but that under the shelter of the law they will defraud their creditors. Unfortunately, such is the struggle for business among competing tradesmen, and such are the necessities of dealers to obtain orders, that the greatest risks are eagerly run. Nor need it be wondered at that these companies are favourably regarded. It is part of the system to present an array of respectable names—men known to be rich, and deemed to be prudent, even from the very circumstance that they are trading with limited liability. But, let us look to the facts. On the face of the Returns it is made clear that one-third of these companies have become bankrupt, and left their creditors unpaid. If such was the case under the restricted application of the principle as it has existed since 1855, it may well be anticipated that there will be a fearful increase of insolvency, mismanagement, and swindling, under the proposed extension of the system. Again, the tendency of limited partnerships is to foster excessive and illegitimate competition in trade. No traders are so utterly reckless as those who have nothing to lose. And it would be found that in proportion as risk was limited, there would be a proportionate disregard of prudence and calculation. Wild and rash speculations would be encouraged by the knowledge that failure involved no irretrievable, perhaps no serious result. Under this new law we should see arise innumerable co-partnerships competing with each other in total disregard of consequences, actuated by trade jealousies and rivalships, and rushing on in a career hurtful to themselves, ruinous to others, and destructive of all honest and legitimate trade. Surely, the advocates of this Bill do not wish to see British commerce degraded by this desperate gambling. But we have abundant evidence scattered through the whole of the blue-book, and especially contained in the answers to the queries of the Commissioners, that limited companies, from their very nature, tend to these results. If an example on a large scale were wanted of their needless expenditure and mismanagement, none better can be found than the history of British railways. If the directors of railways had been spending their own money, or even that of their shareholders, unprotected by Acts of Parliament, they never would have gone to such excess in extensions, competing schemes, Parliamentary contests, and legal costs. The hon. Member for Buckingham has borne testimony to the competition of limited companies, and has also instanced railways in confirmation of his views (page 104). It thus appears that we are asked, under pretence of promoting commerce, to adopt a system which will drive prudent merchants from the field. Lastly, this Bill would give a fatal blow to mercantile character and morality. It has been held the glory of a merchant to meet all his engagements with scrupulous honour. I have heard in this House, on more than one occasion, when some exceptional instance of an opposite kind had startled the public mind, language used which seemed to imply that there had been an abandonment of those old principles and traditions which in by-gone times have raised so high the character of the British merchant. Such statements are rash and groundless. No one can know the interior working of that great system of mutual confidence and honour which constitutes British trade, the tens of thousands in value which change hands by a word or a sign, and the security with which, based on well-known forms and customs, the daily routine of affairs proceeds, but must admit that even the lawyer's parchments do not bind faster than the merchant's word. But this state of things may change; and should this Bill become law, it probably will change. It is proposed to make bankruptcy no longer disgraceful. Under this proposed law a capitalist will not content himself with one adventure. We cannot doubt, from what we know of the energy and enter- prise of our national character, that we shall find merchants engaged as limited partners in various companies. But no one can expect to be equally successful in all his undertakings. He may be bankrupt in one concern and solvent in another. In what position will that man stand, not legally, for that unfortunately is defined by this Bill, but morally? Will he have incurred the greatest stain which can soil the name of a merchant, or under the demoralizing influence of this new law will he be a bankrupt and not be ashamed? It is only the other day that we have abolished imprisonment for debt. If we go farther back, we shall find the bankrupt treated as a Pariah, and (at least in the. North) clothed in a debtor's garment, of which he could not divest himself until he had purged the stain of debt, and become entitled to take his place among honourable men. I have not a word to say in favour of such obsolete barbarisms, but there is no reason why we should go to the opposite extreme, by enacting that bankruptcy shall be no longer a stain, and bankrupts incur no social disqualification. There is a law in the statute book, 52 Geo. III., c. 144, which requires a new writ to be issued in lieu of any bankrupt who may have a seat in this House, and that law has not been repealed by any subsequent amending or consolidating Acts. The position of an insolvent who has failed to meet his engagements in one or many limited companies, will be peculiar and anomalous in regard to this law. What course yon, Sir, might think it necessary to follow in fulfilment of your duty, I will not pretend to say; but this I think I may say, that there should be no limited liability resting on the Members of this House to maintain its honour and its dignity, and these will be best defended by rejecting this Bill. I hope to learn from Her Majesty's Government that they are prepared to adopt that course.

said, he rose to second the Amendment. He was opposed to the principle of limited liability, and went upon the old English principle, that if a man contracted a debt, he ought to be made to pay, unless he became insolvent. The Act of last Session only passed in August, and came into operation in November, and they ought to have experience of the working of that Act before they legislated further in the same direction. He did not see why the same principles should not be applied to joint-stock companies that were applied to railway companies, in respect to which there was a standing order of the House, that they should not borrow any money till 50 per cent of the capital was paid up, and then not move than one-third of the capital.

said, the hon. Gentleman who had moved the rejection of the Bill, and the hon. Gentleman who had seconded that Motion, had both argued against the general principle of limited liability. Now, he thought he was entitled to assume that the general principle of limited liability had been adopted by the House, and it was not necessary, in dealing with the question before them, to argue that general principle. What they had to consider was how the hon. Gentleman who had charge of the Bill proposed to apply that general principle to this particular measure, and what were the sale guards and provisions he had introduced. With regard to the various provisions contained in the Bill, as the hon. Member proposed to refer it to a Select Committee it was hardly necessary to go into the details. He agreed in the general proposition, that a man ought to be able, with proper safeguards, to advance money on the condition that his interest should depend upon the profits, without being liable to be considered a partner. And workmen, he thought, ought to be allowed to be paid by sharing in the profits of their employer, without being considered partners. But he agreed with the hon. Member (Mr. Buchanan), that if a person were to be allowed to share in the profits of a concern without being subject to unlimited liability, he ought to take no share in the management, and in that respect be thought the Bill was defective. He believed that was the principle of the French law as to partnerships en commandite. There were some provisions in the Bill which he wished to guard himself from being supposed to sanction. The hon. Member wished to have all disputes between partners terminated by compulsory arbitration. He (Mr. Milner Gibson) thought they should be allowed to decide matters for themselves. He strongly objected to that part of the Bill which provided for the registration of all firms in the United Kingdom carrying on business under any other designation that the full Christian and surname of every one of the partners. The registration of all those firms would be a very formidable affair. The present joint-stock companies office in connection with the Board of Trade would be totally inadequate; and if to carry out that provision it was necessary to have a central office in London, with local officers all over the country, it would require an office in London as large as the Bank of England. At the same time, he thought there were provisions in the Bill well worthy of consideration, and consistent with the general principle of limited liability already adopted by the Legislature. Therefore, he would vote for the second reading, the more especially as the hon. Gentleman proposed to refer the Bill to a Select Committee.

said, that he could not see any principle on which, if they allowed limited liability to seven or eight, they could deny it to two or three. [An hon. MEMBER: Or one.] He denied that the principle of limited liability had signally failed. On the contrary, he contended, as a practical man, that it had been a signal success. The proof was the almost invariable practice of starting new companies on that principle. It was a great benefit that people could put a certain sum in a concern; and even if that was lost, that they need not necessarily be ruined. But it was said that the creditors were defrauded. That, however, was a great mistake; all that the new law had done was to teach people prudence and foresight. He denied, also, that the limited liability companies had all failed. Many of them had achieved a brilliant success, and some of them would never have been started at all on any other principle. Would any one, for example, have ever thought of projecting the splendid hotels which had lately been set on foot if the law had not been altered? It was not necessary to discuss the details of the Bill, because it was to be sent before a Select Committee, but he greatly approved of the proposal to enable servants to be paid by a percentage without being thereby made partners, or to allow persons lending money to be paid by a fluctuating interest without leading to the same result. He should cordially support the second reading.

said, that the old principle upon which English commerce had been carried on was, that every man who shared the profits should also be answerable for the losses of the trading; and if there were concerns which required an accumulation of capital beyond the means of individuals, a Royal Charter would confer limited liability. So far was the principle of limited liability from leading to the exercise of greater caution, that it would diminish care and must lead to inflated speculation. Under the old system the trader was required to look to his liabilities; under the Bill that responsibility was to be thrown upon the creditor. It was under the old system that the reputation, honour, and credit of the English merchant had grown up, and good reason ought to be shown before it was altered. Unlimited liability had hitherto been done away with only with regard to large companies; and its abolition with regard to every transaction and every concern, however small, must introduce great distrust into commercial transactions, and would probably lead to great losses, calamities, and disasters. If he had wanted reasons for opposing the Bill, he should have found them in the speech of the right hon. Gentleman the President of the Board of Trade, whose remarks were sufficient to show that this was a most crude, undigested, and unsatisfactory measure. He objected to almost every clause of the Bill, and only justified his vote for the second reading on the ground that something might be made of it in Committee. That, however, was not the way to treat a subject of such grave importance. The last Limited Liability Bill which was presented to the House was introduced by the Government, and yet it was altered at least five or six times; and if the Bill before them ought to have been brought in at all, it ought to have appeared under similar auspices. The House ought not to alter the whole foundation of commercial security on the Motion of a private Member, without the consideration and without the sanction of the Government. Without such sanction the Bill ought not even to go to a Select Committee. Select Committees might very well deal with the details of measures upon the principle of which the House was agreed, but in this case the details involved the whole principle of the Bill. The reason why the system of commandite was adopted in France was, that it was impossible to raise sufficient capital to carry on the trade of the country without securing men against complete liability. In this country, however, no such necessity existed. The House ough to hesitate before it moved one straw which would shake the commercial credit of England; and although he did not question the good intention with which this Bill had been introduced, he doubted whether it would facilitate sound and honest trade, and he should vote against the second reading.

explained that he had expressed his concurrence in two of the main principles of the Bill—that persons might advance money to a trading concern, receiving by way of interest a share of the profits, without being constituted partners, and that servants might under similar conditions be paid by a share of such profits. He thought that these provisions might be accompanied by sufficient safeguards, and therefore felt himself at liberty to vote for the second reading of the Bill.

said, he looked upon limited liability as a great evil. It was true that the principle was recognised in the case of joint-stock companies, but for individuals and small associations of half-a-dozen persons the principle was untried, and would, in his opinion, be most injurious to sound trade in this country. He should therefore give his hearty support to the Amendment.

said, that as the law stood there was not the least practical difficulty in remunerating clerks by a salary proportioned to profits without incurring the risk of partnership, so that no amendment of the law was necessary in that respect. As to the proposal that persons should be allowed to lend money and receive a share of profits without thereby becoming partners, he recollected that in 1855–6 an attempt was made to provide for loans such as the Bill contemplated; but, after full discussion, everybody who considered the subject came to the conclusion that the principle of limited liability might be safely introduced in respect of companies, but not of persons advancing loans. The company was required to announce itself as formed on the principle of limited liability, and those who dealt with it were thus put on their guard, and were enabled to ascertain from the registry, if they thought fit, what was the capital of the concern and who were liable. With regard to private partnerships, however, it was impossible to introduce any system of that kind. Suppose a firm established in Manchester or Glasgow, or in places more remote, how were the persons dealing with it to know that the firm was kept afloat by loans from persons who were not partners? How could persons, before entering into transactions with such a firm, send up to London and search the register for information? Then, again, it was not possible that, the Joint-Stock Company's Office could register every petty loan made to firms throughout the kingdom. That office could not perform the work. The Bill contained no provisions by which the public would be put on their guard and informed who were lending money upon the principle of limited liability. He regretted that the Board of Trade, to whom the mercantile public naturally looked for protection, were willing to allow a measure of such grave importance to be scrambled for in a Select Committee, instead of introducing it, if they really approved its principle, upon their own responsibility.

said, that the opponents of this measure seemed to have addressed themselves to the defects of details much more than to the question whether the principle involved was a sound one. That, as he understood, was the point to be determined at that moment; for the mere fact that a Bill contained clauses requiring amendment, or that additional safeguards were necessary, afforded no reason why the Bill should not be read a second time. He agreed that private partnerships on the principle of limited liability should be ear-marked as such, and that that fact should appear in all their notices; but the want of such a provision was a matter of detail which might easily be supplied when the Bill was in Committee. The question before the House was whether an amendment of the law of private partnerships, as regarded that point, was not needed. The House had been told of a distinction so fine that even the framer of the Bill had failed to grasp it. The language of the clause assumed the law to be what it was not—assumed that a clerk would be liable as a partner when he would not; while the marginal note put the matter on its true footing. If a clerk were paid in proportion to profits, and received a salary in the ratio of profits, he was not a partner; but if he received a share of profits, he was liable as a partner. Again, a man might furnish the whole capital of a trading partnership, and take securities for repayment; and if he stipulated for 15 or 20 per cent of interest, instead of a moderate share of profits, he was not a partner. Did the hon. Member for Huntingdon (Mr. T. Baring) really think that the mercantile morality of the country depended upon the maintenance of such a state of the law? He thought that a Bill which got rid of those absurd and irrational distinctions would be of real service to the commercial community, and the requisite safeguards which were omitted might easily be supplied. It was requisite that persons dealing with these companies should know upon what principle they were based, and it was also necessary that those who furnished the capital should not be at liberty suddenly to withdraw it. But to get rid of the anomalies he had mentioned was not a task unworthy of this House, nor did the Government think it right to discourage private Members in the duty which they had taken upon themselves. It seemed to the Government, therefore, right to assent to the second reading of the Bill, while they hoped that it would be greatly improved in Committee, and while they by no means bound themselves to support its passing into law in its present shape.

thought his hon. and learned Friend who had just sat down, had rather offered an apology for the Bill than adduced sound arguments in favour of its principle. He should, he might add, like to know whether it was beneath the dignity of the Board of Trade to take so important a question as that with which the Bill proposed to deal under its consideration, and signalize the present humdrum Session by introducing with respect to it a measure worthy the serious attention of Parliament. As for the measure under discussion, he would appeal to his hon. and learned Friend the Solicitor General, to say whether he would put his name to it without having the slightest doubt as to the answer which he should receive. If, he should like to know, John Smith commenced trade, having borrowed £100,000 from the hon. Member for Birmingham, while he was to be paid by a share in the profits, how were the general public to become aware that John Smith had no capital? His hon. and learned Friend seemed to think everything in the Bill was a matter of detail, but he appeared to forget that the value of such a measure consisted in the way in which its details were worked out. If each Gentleman who had spoken had pointed out a radical defect in the Bill, it was in vain for the right hon. President of the Board of Trade to say that something could be made of it in Committee. That was not a rational and scientific mode of law-making. He hoped the good sense of the House would remit the matter to the Board of Trade, and that that Board would signalize itself for the Session by doing something useful.

said, he should oppose the Bill, as it was in favour of the capitalist, and not in favour of the trader and man of industry. The tendency of the Bill was to uproot that principle which gave England its greatness—the credit which one man gave to another. He believed that credit would cease if the Bill were to pass info a law. Had it not been for the assistance given to him when a young man, he would never in all probability have become a Member of that House. It had, he might add, been his practice to bestow upon those in his employ a portion of his profits as an inducement to exertion, but he at the same time never supposed that he was thereby making them his partners.

said, he admitted that great capitalists might be injured by the operations of the Bill, but he thought it would tend to benefit the public at large. It would not injure the prospects of young men, as the hon. Gentleman who spoke last seemed to suppose. He should support the Bill.

said, he was at a loss to understand why the Bill had been introduced, as he believed it to be fraught with considerable danger and inconvenience; while the existing law did not in his opinion, stand in need of amendment in the direction which it proposed.