rance of the nation, pursuing this important object with undeviating steadiness, have at length completely sur. mounted it; and I have the pleasure to refer the committee to accounts upon their table, which prove that a sum equal to the total capital of the debt existing in 1786 has been redeemed. I mean, that the sums purchased by the commissioners, or transferred to them, exceed the amount of the debt existing in 1786; for this is the only mode in which the redemption of the old debt can ever be ascertained, the new loans having been contracted in old funds, and no distinction kept up between the earlier and later creditors of the public. If any further circumstance could be wanting to prove that the people of this country have at the present time the fairest title to any relief which can be afforded, consistently with the exact observance of public faith, and due attention to permanent security, it will be found in the extraordinary exertions they have made to prevent the accumulation of public debt. Instead of shifting the burden from themselves, and throwing it upon posterity, they have nobly and manfully supported the load of increasing difficulties which the vicissitudes of this eventful contest have thrown upon them. To prevent the increase of public debt, they have actually paid upwards of 200 millions in war taxes; a sum which considerably exceeds the value of the debt existing in 1786. The publie have therefore a right to claim the merit of having doubly redeemed the original debt; first, by its actual repayment, and, secondly, by the anticipated payment of a still greater sum which would otherwise have been added to it. But whatever claims the public may now have on these grounds for relief, and with whatever immediate advantage it might be attended, it becomes us more anxiously to en

quire what are the claims of public faith which we owe to the stockholders, and what the conditions on which the public debt has been contracted. The debt contracted previously to 1792, was raised without any condition of repayment whatever, the government being bound only to the punctual payment of the interest, and left to consult its own discretion or convenience with respect to the discharge of the principal. This debt, however, I contend is now wholly discharged; and that which now exists has been contracted since the passing of the act of 1792, and subject to its provisions. Under these the stock, holder has perhaps no real right, as he has voluntarily subscribed his stock. into the old funds which have no conditions of redemption, but he has undoubtedly a just expectation that the terms of redemption pointed out in that act shall be adhered to.

"Those terms are, that provision shall be made for the repayment of the capital of all debts subsequently contracted, within 45 years from its creation, either by the specific appropriation of one per cent. upon such capi tal, or in any other mode which parlia ment may think fit. That this is the true interpretation of the act, I affirm on the authority of the declarations and conduct of its illustrious author Mr Pitt, and of the resolutions and acts of the legislature itself. Of Mr Pitt's sentiments I can mention a very remarkable instance. It must be generally recollected by those gentlemen who, eleven years ago, were members of the House, that Mr Pitt strongly sup ported the sinking fund act of 1802, but it is not perhaps generally known that he was the original proposer of that act. I speak this from my own perfect knowledge, and there are other living witnesses, and I believe written documents in proof of it. The act originated in a suggestion of Mr

Pitt to Lord Sidmouth, then chancellor of the Exchequer ; and his first suggestion went to this extent, that not only no sinking fund should be provided upon the sums funded in that year, but after reserving so much of the sinking fund as should be sufficient on calculation to redeem the whole debt at par within 45 years, the surplus, then amounting to above a million, should be applied to the public service. After much discussion between Mr Pitt and Lord Sidmouth, at which I had the honour to assist, the proposition was reduced to the more limited form in which it received the sanction of parliament.

"There could not be a more decisive declaration of Mr Pitt's opinion of the true construction of the act, and it was no less clearly shown by his public conduct on other occasions. In contracting several loans in 1798, 1799, and 1800, on the credit of the incometax, he made no provision for the immediate repayment of the principal, but proposed to discharge it by the continuance of the income-tax in time of peace, so long as might be necessary. This shews that he viewed the provision for repayment within 45 years rather with regard to probability and practice than to that extreme nicety and rigour which is sometimes insisted on; for it was clearly possible that the war might outlast 45 years, and in that case no provision whatever would have been made for the redemption; but Mr Pitt viewing the subject as a wise and great statesman, according to the probabilities of human affairs, thought it sufficient to make such provision as any reasonable and practical man would think adequate to its purpose; not looking to such cases as, though mathematically true, approached the extreme verge of possibility.

"With respect to the resolutions of parliament, I shall beg leave to refer

to the first of those passed by this House on the 18th of May 1802, and lately read at our table. On these resolutions an act was founded, which, as well as the acts which established the loans to which I have just referred, clearly evinces the opinion of the legislature, that the act of 1792 merely required that provision should be made for the redemption of debt within 45 years from its creation, leaving to the discretion of parlia ment both the mode to be applied in specific cases, and any subsequent variation of that mode, which, within the limits prescribed, it may think proper to adopt.

"I shall now attempt to explain to the committee how it appears to me that some immediate relief may be afforded to the public, without the smallest infringement of the provisions of the act of 1792, which I have detailed. Neither the act of 1786, nor that of 1792, contains any provision as to the mode in which the debt, when purchased, shall be cancelled or discharged, so as to relieve the charge upon the consolidated fund. There are two modes in which this might be carried into effect. The first would be, that, supposing any number of successive loans to be contracted, a proportion of sinking fund should, according to the present practice, be attached to each, and should continue to accumulate at compound interest until the whole of such loan should be discharged by its exclusive operation, and thus that the redemption of each should be separately and independently effected.This is understood to be the mode established by law under the operation of the act of 1792, in some degree varied by that of 1802, but remaining in force as to all loans contracted subsequently to the latter of those years. It is evident, however, that as the funds are intermingled

and consolidated, the stock created for any particular portion of debt cannot be distinguished, and the purchases are made indiscriminately. Any separate loan can therefore no other wise be redeemed than by purchasing, with the sinking fund attached to it, an amount of stock equal to that which was created in consequence of such a loan.

"The other mode, which would have been equally consonant to the spirit of the act of 1792, would have been to direct that the debt first contracted shall be deemed to be first paid off, and that the sinking fund created in respect of any subsequent loan shall be first applied to the discharge of any prior loan then remaining unreclaimed, while the operation of the per centage created for those earlier loans should be continued for the redemption of those subsequently contracted. By this means the loan first contracted would be discharged at an earlier period, and the funds charged with the payment of its interest become applicable to the public service. Thus in the event of a long war, a considerable resource might accrue during the course of the war itself, as every successive loan would contribute to accelerate the redemption of those previously existing, and the total amount of charge to be borne by the public in respect of the public debt, would be reduced to a narrower compass than in the other mode, in which a great number of loans would be co-existing. At the same time the ultimate discharge of the whole debt would be rather accelerated than retarded. The advantages of this mode of operation did not perhaps present themselves to Mr Pitt when framing the arrangements of the sinking fund, in the prospect of a continuance of peace, and with a very remote view of the ultimate redemption of the debt, nor would it have been easily made

applicable to the large mass then existing, and for the redemption of which no provision had before been made. But the circumstances of the present time afford a most advantageous opportunity of establishing a plan which would in the first instance have been preferable. It is now only necessary to declare that an amount of stock equal to the whole of the debt existing in 1786 has been redeemed, and that in like manner, whenever an amount of stock equal to the capital and charge of any loan raised since 1792, shall be redeemed in its proper order of succession, such loan shall be deemed and taken to be redeemed and satisfied. Every part of the system will then fall at once into its proper place; and we shall proceed with the future redemption with all the advantages which could have been derived from the original adoption of the mode of successive instead of simultaneous redemption. Instead of waiting till the purchase of the whole of the debt consolidated in 1802 shall be completed, that part of it which existed previously to 1792, will be considered as already redeemed, and the subsequent loans will follow in succession whenever equal portions of stock shall have been purchased. It is satisfactory to observe, that by a gradual and equable progress we shall still have the power of effecting the complete repayment of the debt more speedily than by the present course. I do not pronounce whether it will be wise to persevere to that extent. It will be for parliament to judge when the proper time arrives, which is yet at a considerable distance; but we are doing our duty to posterity not only scru pulously but liberally, while we not only much more than satisfy the provisions of the act of 1792, which requires the redemption of the debt within 45 years, but actually antici pate that course of redemption which

is now provided. The tables which will be put into the hands of gentlemen, will shew them that means are provided by the proposed plan of effecting the total repayment of the existing debt from four to ten years, and that of the future debt which may be incurred, according to the various suppositions assumed, from 14 to 17 years, sooner than by the laws now in force. This statement is sufficient to shew how amply the proposed plan is capable of satisfying the most sanguine expectations of the nation with respect to the final discharge of its debts, as well as the fair claims of those who look to the execution of the act of 1792, as the means of supporting the value of the public funds. I have mentioned the result of such calculations as are intended to be communicated to the House; other cases may be supposed by which the result may be varied in degree, but not in general effect.

"I have thus far attempted to explain the intended system to the committee, and to recommend it by its general and intrinsic advantages without displaying the immediate benefits of its adoption. Yet they are such as must be highly satisfactory to par. liament, and of the greatest importance in the present situation of the country.

"The immediate result of this system, simple as it may appear, and really is, will be equal to a subsidy of above one hundred millions. For four years to come, we may, on the supposition of the continuance of the war, hope to be obliged to impose no other taxes than such as are required to furnish those additions to the sinking fund which I pointed out in the early part of my statement. I need not dwell upon the advantages of such a relief, I need not explain its effects in raising the spirits and animating the exertions of the nation. I need not en

large on the confidence it must give to our allies, and the despondency it is calculated to impress on our enemies. But that which in my view renders it peculiarly valuable is, that it is so far from being purchased by an accumulation of burdens on the succeeding years, that though its advantages may be very different in degree, according to the different cases supposed, yet it will in all, for several years to come, produce a very considerable diminution of charge.

"Such are the general principles of the plan to which I beg to call the most serious attention of the committee, but not at present to press for its judgment. That it is free from objections I cannot hope, but I trust that parliament will on mature consideration be convinced, as I am myself conscientiously persuaded, that they are such as bear no proportion to its advantages. I can at least acquit myself of having hastily and rashly determined on a measure of this magnitude and importance. It has for many months been the subject of my most anxious meditations, and of repeated and detailed discussions with those whom I thought most capable of guiding my judgment; and I submit it to the committee not without great anxiety, but with the confidence naturally flowing from the most sincere conviction.

"I am fully aware, that in proposing. any change in a system so justly revered, and considered as the firmest hope of the nation, I am incurring a great responsibility, but I also feel that I ought not to shrink from it, in the prospect of performing a great publicservice. Many a gallant and worthy man has laid down his life to atchieve a much less important service to his country, than that of providing at such a moment the supplies necessary, during four years, for the contest in which we are engaged. In the hope.

of procuring this benefit to the public, I am willing to risk what many, to whom life is dearer than it is to me, have valued beyond their lives-I mean that reputation and public confidence which they have sought, and in some degree acquired, by a long course of faithful, though imperfect service to the country. I am aware that my reputation is staked upon this plan; but God forbid that my reputation, or that of any man, should be placed for a moment in competition with the great public interests which are concerned. I only wish the House to deliberate maturely, and to decide wisely. Such information as has ap peared to me necessary to enable gentlemen to take a complete view of the plan, will be put into their hands, and if any further information should be desired, I shall most readily lend my assistance to furnish it."

This plan was strenuously opposed by many members of the House; and as the subject is of great national importance, it will be proper to give an ample view of the leading arguments. "By adopting this plan, it was said, we must incur the risk of losing the fruits of all the sacrifices which we have made for the last twenty years ;-that we must lay ourselves open, not to the mere possibility, but to the probable and imminent danger (in the event of a long continuance of the war) of undermining, if not destroying altogether, that system of public credit which is the foundation of our present safety and independence, and the last support of that pre-eminent rank which we now maintain among the nations of the world.

"There is another question, (it was said), of a magnitude not inferior to this, which cannot be put out of sight in the examination of these proposals, -the maintenance of public faith, on all occasions so essential to the honour of the country, and in this instance more especially to the honour and cha

racter of parliament. The highest considerations of public policy and public justice were therefore equally involved in the present discussion. The edifice of the sinking fund, which was thus to be pulled down, was perhaps the proudest monument which was raised by the virtues and genius of Mr Pitt to his own fair fame. So it was held in his own estimation; so it is held in the estimation of his friends, and not only of his friends, but of those who were his political enemies, and of the whole world.

"When Mr Pitt was called to the head of affairs, and to the management of the finances at the close of the American war, credit was at its lowest ebb, our revenues deplorably deficient, and our resources for improving them apparently exhausted. Yet such at that time were the real resources of the country, when properly. called forth and wisely administered, that in the year 1786, Mr Pitt was enabled, after making provision for the interest of the public debt, and for all the expenses of a peace establishment, to set aside and appropriate a surplus of income, amounting to One Million annually, as the foundation of a sinking fund for the redemption of the then existing debt of 238 millions. By the act of parliament which was passed for this purpose, (26. Geo. III. cap. 31.) it was provided, that this sum of One Million should be laid out either in the redemption of stock, if at par, or, if under par, in the pur chase of it in the open market at the current price of the day ;-that the interest arising from all stock so redeemed should be added to the principal, and be laid out in the same manner, until by their joint accumulation at compound interest they should amount to the annual sum of four mil. lions; that when this sinking fund had reached that amount, it should continue from thenceforth to be laid out at simple interest only, leaving