Institute of Historical Research



William A. Shaw (editor)

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'Introduction', Calendar of Treasury Books, Volume 21: 1706-1707 (1952), pp. V-XLIV. URL: Date accessed: 21 April 2014. Add to my bookshelf


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The first Parliament of Queen Anne was dissolved by Proclamation on the 5th April 1705. The elections for the new Parliament ran through the month of May and the early part of June and were fought with extreme bitterness and violence. They resulted in a decisive change in the grouping of parties. Godolphin's computation was that in the new House there were 190 Tories as against 160 Whigs and 100 members whom he calls “the Queen's servants,” meaning the members of the Executive, office holders, place holders and pension or grant holders. Out of the total of “Queen's servants” he regarded about 15 as uncertain, having voted with the Tories in the opening struggle for the election of the Speaker “and so afterwards more or less in almost every vote.” The remainder of the “Queen's servants” voted always with the Whigs so that the respective strength of the two parties as revealed in the test vote over the speakership was 205 Tories against 245 Ministerialists and Whigs. In the preceding Parliaments Harley had commanded or had secretly manipulated a majority which at times numbered 100 or more.
It might have been expected that as a matter of course the Queen's business would be accelerated and that friction would be eliminated as far as the action of the Executive was concerned. But in the domain of finance it would not be safe to draw this inference. If the new parliament had been completely subservient or accommodating in the matter of finance there would have been no need for Godolphin to follow so cautious a policy as he did. He would have been able, and certainly it was his duty, to estimate for a full Supply for the fighting services instead of merely presenting the stereotyped token Estimates. By that means he would have been able to stop the further increase of floating debt. And, further, he would have been able to insist on some show of provision for that floating debt as it then stood, and also some provision for Extra-ordinaries of the war. And so by forcing the House of Commons to face the realities of the situation he might have evolved a statesmanlike long-term programme of finance which would have looked beyond the mere needs of the war. That he did none of these things proceeded from the then imperfect conception of stage managing and presenting the Queen's business, as much as from his own instinctive sense of caution and his fundamental distrust of all parties, Whig and Tory alike. But there is not the same excuse and allowance to be made for the Whig party itself. That party was supposed to be wholehearted in the support of the war but its financial measures bear no evidence of this. Its votes of Supply represented the bare living minimum for the fighting Forces, Extraordinaries were not considered, Debt was not considered, the systematic defrauding of the Civil List and of the Civil Service was completely ignored.
At the opening of the Session the House had ordered that an account of the “public money [granted] for the year 1705 and what hath arisen in that year and [hath] been applied to the [service of] former years be laid before this House by Mr. Lowndes, Secretary of the Treasury” (Commons Journals XV, p. 15, 8 Nov. 1705). These accounts were delivered in by Lowndes on the 10th (Luttrell V, p. 610) and on the 16th the House Resolved that it would on the following Thursday take into consideration the accounts of the Public Revenues and Debts ever since her Majesty's accession (C.J. XV, p. 29). The two subjects, viz. the Revenue and Debt accounts since the commencement of the reign and the disposal of the 1705 revenue were accordingly debated not in committee but in the House on the 22nd November (C.J. XV, p. 35). A little later Lowndes added a further statement of the public revenue of the year 1704–5 (C.J. XV, pp. 61, 115) but the further debate was postponed week after week and finally only took place on the 21st February (Ibid, p. 165). It ended in the following Resolution:
the House according to order proceeded to take into further consideration the accounts of the Revenue and Debts ever since her Majesty's happy accession to the Crown.
Resolved: that it appears to this House that the public Revenues granted or arisen since her Majesty's happy accession to the Crown have been duly applied to the public uses, under a prudent management, to the advancement of the public credit and for the advantage and honour of the nation.”
If this consideration of the finance accounts of the nation had been honest and patriotic it must have resulted in such a grant of Supply as would either fund the floating Departmental debt or prevent any further increase of that debt. But such a practical and statesmanlike conclusion was not at all the purpose in hand.
The whole review and debate was intended as a vindication of Whig Junto finance from the vicious aspersions of the last Report of the Commissioners of Accounts. As a matter of fact the Resolution was merely a repetition of the Address which the House had adopted at the opening of the Session in reply to the Queen's speech. It was purely a party move in a party wrangle and when the Resolution had been recorded in the Journals the subject dropped and the Treasury was left in exactly the same position of difficulty as before, with an unprovided and still increasing floating debt in the three services, Army, Navy and Ordnance, and with a growing deficiency in the Civil List.
The triumphant majority of Whigs and ministerialists, which in matters of finance could have done just what it pleased, spent the whole Session in a mere humdrum discussion and provision of an inadequate Supply for the war, at the same time that it evaded the debt problem and cut down direct taxation to the minimum by adopting the alternative solution of borrowing by a sale of Annuities.
In her Speech to the Parliament at its first meeting on the 27th October, Anne asked for a speedy Supply for the War and again offered to contribute out of her own revenue [the Civil List] what she could reasonably spare. The House of Commons paid her the lip service of adulation in their answering Address but a whole fortnight passed before they called for the usual Estimates. The Votes of Supply were only completed on the 30th November and the first Ways and Means Bill, the Land Tax, only passed both Houses at the end of December.
In order to realise the paralysing effect of such dilatory Supply on the Executive it must be understood that the Treasury could not borrow money or make out tallies or paper orders on any form of Supply until the Bill for that Supply had actually received the Royal assent. Whether it was a Land Tax or Malt Duty or any other form of supply the Treasury could only borrow on it in advance if the Bill for it had become law and if the text of the Bill contained a clause authorising such borrowing. In this particular instance therefore the Lord Treasurer was chafing and biting his nails for a full two months before he could help the services to money.
C.J. XV, 23–25. The Estimates for the Forces for the coming year 1706 were laid before the House on the 14th November by Henry St. John in his capacity of Secretary at War. They were as follows:—
(1)Estimate for the Guards, Garrisons and Land Forces in England, Jersey, Guernsey and the Plantations and for soldiers for sea service.
Horse: l. s. d.
Guards (First,Second and Third Troop, 543 men, Troop of Grenadier Guards, 177 men and Royal Regiment of Guards 427 men: in all 1247 men) 85,607 14 2
Queen's Regiment (Col. Carpenter) and the Earl of Essex's Regiment (407 men each: in all 814 men) 29,479 16 8
First Regiment of Guards (2283 men), Coldstream Regiment of Guards (1143 men), Royal Regiment of Fusiliers (834 men), Col. Rivera's Regiment (834 men), (in all 5,094 men).
six Regiments for Sea Service (Earl's 834 men; Handasyde's at Jamaica, 966 men; Livesay's 702 men; Whetham's in the Leeward Islands 834 men; Mordaunt's, 834 men; Lord Paston's 834 men) (in all 5,004 men).
total Infantry 10,098 men 191,545 18 4
four Companies at New York (449 men)
one Company at Bermudas (58 men)
one Company at Newfoundland (93 men)
(total 600 men) 9,885 17 6
General Officers 10,669 10 0
Contingencies 7,938 11 8
Garrisons [England] 16,872 11 8
Invalids 5,000 0 0
£357,000 0 0
Five thousand Additional Forces for sea service to serve with the Fleet viz: 6 Regiments of 834 men each: l. s. d.
Charlemont's, George's, Caulfield's, Breton's, Soames's, Hotham's, total 5,004 men 87,125 10 0
General Officers 7,604 3 4
Contingencies 2,000 0 0
£96,729 13 4
total Estimate for Guards, Garrisons and soldiers for sea service, 453,729l. 13s. 4d.
Estimate for the Forces serving abroad
in Flanders
The 40,000 men to act with the Allies in the Low Countries.
English Forces.
Horse: l. s. d.
Lumley's 598 men, Cadogan's, Wyndham's, Wood's and Schonberg's, each 400 men, in all 2,198 Horse 122,153 6 8
Hay's, Ross's, each 541 men; in all 1,082 Dragoons 38,677 16 8
Royal Regiment 1,876 men; Churchill's, Webb's, Lord North and Grey's, How's, Godfrey's, Ingoldsby's, Mordaunt's, Sabine's, Tatton's, Ferguson's, Temple's, Meredith's, Elliott's, each 938 men; Evans's 876 men: in all 14,946 Foot 258,514 5 10
General Officers 16,302 10 10
Contingencies 10,000 0 0
Forage and Waggon money 16,259 15 0
total for the English part of the 40,000 men 461,907 15 0
This Estimate represents an increase over the preceding year's Estimate by 246l. 7s. 6d. by the addition of 3 Troopers to Brigadier Cadogan's Regiment and 2 Dragoons wanting in the two youngest Troops of each Regiment of Dragoons.
Foreign portion of the 40,000 men. l. s. d. l. s. d.
Danes (6,000 men) 116,282 15 0
Prussians (2,532 men) 43,018 18 6
Hessians (3,080 men) 53,685 0 0
Hanover & Celle (10,000 men) 171,329 10 0
total for 39,829, Foreign part 384,316 3 6
This Estimate represents an increase over the preceding year's Estimate by 784l. 7s. 6d. to the Troops of Hanover pursuant to the Treaty concluded after the last Supply was voted by Parliament in [being for an] addition for the twelfth Battalion taken into the service.
Bread waggons for the 40,000 men 20,000 0 0
Forage, waggon money and recruits for the Foreign portion of the 40,000 men pursuant to the Treaties 20,000 0 0
total for the 40,000 men £886,223 18 6
On the 19th November, (C.J. XV, p. 30) an additional vote of a charge of 610l. for horses lost by the officers of the First Battalion of Foot Guards was laid before the House by St. John as Secretary at War.
Estimate for the 20,000 Troops of Augmentation.
English Foot: Guelders Stivers
Col. Lalo's Regiment (876 men)
Brig. Farrington's (876 men)
Col. Stringer's (876 men)
Col. Macarty's (876 men)
total 3,504 men 667,037 10
Holstein Gottorp:
2 Regiments of Dragoons (1,116 men)
2 Regiments of Foot (1,766 men)
total 2,882 men 578,981 5
Saxe Gotha:
2 Regiments of Dragoons (892 men)
2 Regiments of Foot (1708 men)
total 2,600 men 488,260 10
Munster: 3 Regiments of Foot
total 2,442 men 352,754 5
Hesse Cassel: 1 Regiment of Foot
total 885 men 122,621 15
Osnabrug: 1 Regiment of Foot
total 807 men 110,626 18
Oost Frieze: 1 Regiment of Foot
total 797 men 113,405 10
Liège: 1 Regiment of Dragoons (581 men)
2 Regiments of Foot (1,596 men)
1 Regiment of Foot more (797 men)
total 2,974 men 497,513 5
Palatine: 4 Regiments of Foot
total 2,600 men 322,321 5
Danes: 520 supernumerary above the Danish part of the 40,000 men, and transferred to this Establishment of the 20,000 men 174,752 17
total 20,011 men 3,428,275 guelders
whereof the Queen's moiety is 1,714,137 guelders 10 stivers
l. s. d.
which at 10 guelders 10 stivers to the £ sterling makes 163,251 3 6
bread waggons for the 10,000 men 5,000 0 0
forage waggon money and recruits for the Foreigners [part of 10,000 men] 9,260 0 0
£177,511 3 6
The Estimate For The Forces on The Establishment For Portugal.
Horse: l. s. d.
Major Gen. Harvy's Regiment (418 men) 23,107 10 10
Royal Regiment (589 men)
Major Gen. Cunningham's (443 men)
total Dragoons 1,032 men 36,378 6 8
Regiments of the Earl of Portmore, Lieut. Gen. Stewart, Col. Hill, Earl of Barrimore, Brig. Blood, Brig. Brudenall, Lord Mountjoy, Col. Wade, Earl of Donegal, Col. Hans Hamilton (10 regiments of 876 men each)
total 8,760 men 214,610 17 6
General Officers 11,436 13 4
Contingencies 4,000 0 0
total Establishment 230,047 10 10
deduct two thirds of the Poundage 7,668 5 0
£222,379 5 10
Subsidies to the Allies.
The Queen's proportions thereof for the year 1706 according to the Treaties. l. s. d.
King of Denmark (in Bank money at Hamburg) 150,000 Crowns 37,500 0 0
King of Portugal (for the 13,000 men) 666,666 Patacoons, 33 st. at 4s. 6d. each or 600,000 Crowns a year 150,000 0 0
Duke of Savoy at the rate of 53,3332/3 Crowns per month or 640,000 Crowns per an. 160,000 0 0
Landgrave of Hesse Cassel, 25,000 Crowns per an. 5,952 7 6
Elector of Treves 25,000 Crowns per an. 5,952 7 6
Elector Palatine 20,000 Crowns per an. 4,761 18 6
King of Prussia (for the Queen's proportion of the charge of 8,000 men sent to the assistance of the Duke of Savoy), 200,000 Crowns 50,000 0 0
£414,166 13 6
Extraordinaries of the War in the year 1705 not provided for in the last [1705] Session of Parliament. l. s. d.
to the King of Prussia for her Majesty's share of the Subsidy payable to him pursuant to the Treaty commencing 4 Jan. 1704–5 o.s. at the rate of 200,000 Crowns a year: to wit, from 24 Jan.—24th Dec. 1705 48,630 0 0
Bounty money bestowed on the Land Forces that served in Germany in 1704: pursuant to the Address of the House of Commons 65,000 0 0
Additional charge to the Troops of Hanover and Cell pursuant to the Treaty concluded since the Supplies for the Army were voted by the last Parliament 784 7 6
for the General Officers in the Expedition to Spain under the Earl of Peterborough from 1 Apr. to 24 December 1705 5,631 16 8
for Contingencies [for said Expedition] upon account 2,000 0 0
Levy money for recruiting the horses of the English Horse and Dragoons which were killed and lost in passing the enemy's lines and which died of the common distemper this last campaign in the Low Countries between 1 May and 31 October [1705] by estimate 15,296 0 0
for Officers' horses of the English Troops that have suffered the same fate, viz.
of the Horse and Dragoons 4,180 0 0
of the Foot, who have been equal sufferers this Campaign as well as the last and without some relief will not be able to take the field the next year 10,880 0 0
£152,402 4 2
Memorandum: in the computation for recruit horses there is reckoned only for such as are certified upon oath to have been lost within the aforesaid time: since which there are more horses dead and continue to die daily, so that the same is daily increasing; of which a further account is expected over.
The loss which the Foreign Troops in her Majesty's pay have suffered of this kind is likewise to, be considered as soon as the Resolutions of the States General shall be known; her Majesty being obliged by the Treaties to pay such rates as shall be regulated by the Dutch for the Troops in their service.
C.J. XV, p. 20. The Estimates for this Office were submitted to the House on the 13th November 1705 by Lieut. General Earle. On this occasion the Journals contain the details of the full service, that is both for Sea Service and for Land Service. That for the Sea Service was in the usual form of 4s. per head out of the 4l. per head for 40,000 men for the Navy but there were two additional items
l. s. d.
4s. per head for 40,000 men 104,000 0 0
to carry on the building of the wharf at Portsmouth 10,000 0 0
for Ordnance, carriages and stores for the ships building in lieu of those lost in the late dreadful storm 18,238 17 4
£132,238 17 4
The Estimate for the Land Service was more detailed and informing than usual:
l. s. d.
the charge of the Hollands train 45,000 0 0
the Ordinary of the Office (salaries, rents, repairs of storehouses, barracks, platforms, carriages, stores in the several garrisons and incidents) 28,273 13 0
200 tons of saltpetre for supply of the Stores 10,600 0 0
charge of repairing fortifications 15,000 0 0
the yearly charge at Jamaica 1,126 7 6
the charge of stores sent to Newfoundland 3,026 0 10
the yearly charge of the powder sent to Portugal and the pay of the Train there 17,366 17 6
the charge of stores and tools sent to Gibraltar and a year's pay to the Officers, gunners and artificers there 24,120 4
the yearly charge of an engineer at New York 182 10 0
the charge of stores sent in the Expedition with the Earl of Peterborough 13,584 4 7
the yearly charge of the Officers employed in the same Expedition 2,701 0 0
the charge of small arms for supply of the stores 12,000 0 0
£172,980 18
To this Estimate there is appended a note that the charge of repairing the fortifications at Gibraltar had not yet been sent to the Office.
The two Estimates combined, for Sea Service and Land Service, amounted to
l. s. d.
132,238 17 4 for Sea Service
172,780 18 0½ for Land Service
£305,019 15
representing a sensible increase over the figure of 160,000l. Supply Vote for the preceding year.
C.J. XV, p. 21. 13 Nov. 1705 Debt of the Office of Ordnance as at 30 September, 1705.
l. s. d.
Due to artificers and others for stores delivered and services performed to 30 September 1705 123,247 9 5
due to the Hollands Train 14,548 19 2
due to the tenders on the Bomb vessels in the Straits; as also 8 fireworkers, 16 bombardiers and 4 carpenters 4,243 14 0
due to engineers and artificers at Newfoundland and for works there 1,642 7 6
due to engineers and artificers at Jamaica 1,126 7 6
due to the Portugal Train, for arrears and contingencies 4,903 7 6
due to the Commissary of the Naval Stores at Lisbon for hire of vessels and storehouses for the stores there 3,526 13 4
due to an engineer at New York 182 10 0
due to an engineer sent to Gibraltar and to fireworkers, bombardiers and gunners there and for stores rent 24,120 4 7
due for the Expedition with the Earl of Peterborough 16,285 4 7
due for stores sent to Newfoundland 3,026 10 1
due for salaries fin the Ordnance Office] and for rents of storehouses 4,726 5
due for stores on contracts and warrants 12,200 0 0
due on contracts with gunfounders 15,800 0 0
due on contracts and warrants with gunsmiths for small arms 7,800 0 0
£237,379 13
C.J. XV, p. 19. The account of the Navy Debt as it stood on the 30th September 1705 was submitted to the House on the 13th November 1705 by Col, Churchill as from the Admiralty. This account deals entirely with the floating debt and briefly is as follows:
l. s. d.
bills in the Second Book 15,944 7 8
on the head of Wear and Tear, including the Yards and Rope Yards 1,119,135 6 5
on the head of Wages 1,284,788 13 5
Victualling 765,070 5 10
Sick and Wounded and prisoners of war 51,530 0 0
debt-outstanding from before the accession of Queen Anne on bills in the Second Book, Wages and Victualling, 101,672l. 15s. 1d.
£3,236,468 13 4
Towards this total of the running debt the Navy Treasurer had in his hands 55,049l. 5s. 9d. and there still remained for him to encash an amount of 540,381l. 10s. 6d. (including 100,025l. 6s. 2d. of undirected money and tallies) of unexhausted Navy credit or supply voted by the House for the year ending at 29 September 1705. This left an unprovided sum of floating Navy debt of 2,641,037l. 17s. 1d. at the opening of the new Parliament, not including 220,942l. 16s. 10d. for debt in the Naval Registry Office.
It is specifically noted that this account contains four items of expense which the House of Commons by several Addresses had desired the Queen to undertake but for which they had voted no Supply. The amounts which the Queen had accordingly paid on these items up to 30 September 1705 were as follows:
l. s. d.
bounty to widows and orphans of officers and men drowned in the great storm 16,601 5 7
ships built in lieu of those lost in the great storm 134,232 0 0
bounty money to officers and men on account of the engagement in the Mediterranean 19,737 9 8
paid on the same head 1 October 1705 3,248 16 1
£173,822 11 4
C.J. XV, pp. 18, 20. The Estimate for the Ordinary of the Navy, or as it was styled for the Navy in harbour was presented to the House by Col. Churchill on 13 November 1705. It is not entered in the Journals and is not preserved in the Treasury Board Papers. But as an Estimate item it altered very little from year to year. It included the staffs at the Admiralty and the Navy Office, the Yards and the Navy in harbour. For the preceding year 1704–5 the Estimate amounted to 137,026l. 8s. 5d. not including the charge of the Office for Registering Seamen nor any item for bounties to sea widows and orphans. Including these items the normal average for the Navy Ordinary was approximately 175,000l.
C.J. XV, pp. 28, 27. Luttrell V, p. 68. On the 14th November the House went into Grand Committee of Supply for the Navy and came to a Resolution, which is only recorded in Luttrell, that 40,000 men be employed in the Sea Service next year [1705–6], 8,000 whereof to be Marines: all at 4l. per man per month. On the following day the House adopted the Resolution.
C.J. XV, p. 20. This was the stereotyped vote and in a sense might be regarded as a token vote, seeing that the actual number of “men employed in the Sea Service” at the end of the preceding October was 50,635. During part of the year 1705 the number had risen to nearly 52,000. In the year 1703 the number of men had risen to 54,884 and even as to this number it is not stated that it included Marines. But in effect the vote was not regarded as a token vote; that is to say the House of Commons did not attempt to extend or supplement the Supply so as to provide for the extra complement of men beyond the voted 40,000. The idea of supplementaries within the same year had not yet evolved itself. If the House could be convinced that Supply voted in one year was insufficient in the case of any service then it would consider making a fresh grant to cover services not supplied during the previous year or during a number of previous years. But such cases were always treated as Extraordinaries of the War. In the case of the Navy the cost of the excess number of men simply went forward as Navy Debt and in each successive year the House called for an account of that debt as a preliminary to the consideration of Supply. But having obtained the account it was left on the table. No action was taken upon it in the way of liquidating the deficit and all the time the situation was growing worse and the seamen were besieging the Ticket Office for their wages. The imperfect supervision or control of finance which was exercised by the House of Commons was not so much due to members' ignorance of service conditions as to a want of liaison between the Executive, the Queen's Ministers, and the House. Having obtained a grant of supply for 40,000 seamen to keep the Navy going the Lord Treasurer and the Lord Admiral went on employing more than 50,000 men and pinched and scraped in an attempt to eke out an insufficient grant instead of asking the House for the exact balance sum required. It will be noted for instance that in the statement of the Navy debt as it stood on the 30th September 1705 there is no reference to the specific number of men employed in excess of the 40,000. There is simply one lump sum set down for debt on the head of Wages; and this was merely as an item in a statement of debt. On the 30th September 1704 the debt on the head of Wages had been 914,163l. 13s. 10d.: a year later, on the 30th September 1705 this had grown to 1,284,788l. 13s. 5d. or an increase of 370,635Z. (C.J. XIV', p. 400, XV, p. 19). This statement of debt was not put forward by the Ministry as a demand on an Estimate. It is not surprising if the House left it on the table and voted nothing for debt on that head. This deplorable result arose simply for want of a lead from the Ministry to the House. Such was the Parliamentary system of the time, an imperfectly co-ordinated Estimate procedure. The Admiralty and the Lord Treasurer knew to a penny what money was required but they did not present a demand for the full amount. They left the House to its own Supply procedure and contented themselves with making speeches in the House or in Grand Committee just like ordinary Members.
Similarly the Victualling debt at the 30th September 1704 had amounted to 442,120l. 3s. 3d. A year later 30 September 1705 it had risen to 651,777l. 5s. 11d.
C.J. XV, p. 17. C.J. XV, pp. 27–29. Luttrell V, p. 612. The Transport Debt. In response to the request of the House of the 10th November the Commissioners of Transport laid before the House on the 16th November an account of the Debt of the Transport service in general during the present war to 30th September 1705, together with an account of the growing charge thereof and also an account of the expenses for transporting her Majesty's Forces for one year ended 30 September 1705 together with the growing charge from that time per month. The underlying assumption in these three accounts is that all the Transport Debt of William's reign had been provided for (except one item as below) and that there was no carry over into the national accounts from the commencement of Anne's reign. How far this assumption was justified has been already examined [Introduction to Vol. XI–XVII, p. ccxiii] and need not be recapitulated.
Starting from 1702 the Transport Debt is stated as follows
l. s. d.
charges of transporting Forces from England to Holland in 1702 15,177 7
ditto in 1703 3,926 10 8
ditto in 1704 8,822 6 3
ditto in 1705 8,814 1 9
£36,740 5 10½
ditto to Spanish and West Indies in 1702 and 1703, viz., 29 ships to Spain 90,470 5 6
and 16 ships to the West Indies 19,878 3 5
£116,348 8 11
ditto to Portugal in 1703, 1704 and 1705 196,822 3 3
provisions, and bedding, etc. for men and horses 41,360 10
£238,182 14
These sums make a total of 391,27ll. 8s. 10d. and the current Supply of the years covered had provided 219,527l. 8s. 3d. towards that total, thus leaving an uncovered debt of 171,744l 0s. 7d. viz. 5,940l. 8s. 7d. on the Hollands service, 24,606l. 15s. 11d. on the Spanish and West Indies service and 141,196l. 16s. 1d. on the Portuguese service.
To this statement is appended a memorandum.
“There are at present in her Majesty's Transport service 69 ships viz. 1 at Lisbon, 61 in the Straits and 7 going from Ireland to Portugal: the growing charge whereof in 9,916l. per month.
“Over and above which there is remaining due the sum of 2,000l. for principal on account of three several bills of exchange for 5,000l. sterling drawn in 1698 and 1699 from Rotterdam by Daniel Sadler, late Agent for Transport service in Holland (for which he hath given the King credit) on the then Commissioners for Transportation, which bills they accepted but for want of money they could not pay the same: for which he hath been imprisoned and is likely to be ruined thereby.” To the sum of 2,000l. for principal there was to be added 847l. 18s. 8d. for interest to 30 September 1705 and for protests etc.
The last of these three accounts approximates more closely to our conception of an Estimate
“The growing charge for 69 ships now in her Majesty's service is 9,916l. per month.”
If that charge should endure through the coming year from 30 September 1705 to 30 September 1706 the sum required for the Transport service in that year would be 128,906l.
As illustrative of this the Transport account for the year just expired, 30 September 1704 to 30 September 1705, totaled 142,928l. 9s.d. as follows
l. s. d.
for freight, provisions and other necessaries for men, horses and clothing transported this year from England to Holland 8,811 1 9
for freight of several ships hired in Ireland and England to carry Forces to Portugal and for several ships hired in England and at Lisbon to attend the Grand Fleet 112,016 16 6
for provisions and other necessaries for men and horse from Ireland and England to Portugal and for bedding and other necessaries for 5,000 men to attend the Grand Fleet 21,280 12
for freight and provisions in transporting 2,100 men between England and Ireland 817 2 5
total £142,928 9
The Reports from Grand Committee of Supply began to be made on the 17th November and were followed in rapid succession by the Supply Resolutions:
Navy Ordinary: November 17. C.J. XV, p. 29 that a sum not exceeding 120,000l. be allowed for the Ordinary of the Navy for the year 1706.
Ordnance: November 20. C.J. XV, p. 30. that 10,000l. be allowed to the Ordnance towards making a wharf and storehouse at Portsmouth and a sum not exceeding 18,238l. 17s. 4d. be allowed for ordnance stores and carriages for eight ships new built in lieu of those lost in the great storm.
Army: Guards and Garrisons: Nov. 22. C.J. XV, pp. 34–5 that a sum not exceeding 357,000l. be granted for maintaining Guards and Garrisons and pay of Invalids for 1706 including 5,000 men to serve on board the Fleet.
Army: the 40,000 men: a sum not exceeding 886,223l. 18s. 6d.
Army: a sum not exceeding 177,511l. 3s.6d.
Army in Portugal: that her Majesty's proportion of Land Forces to act in conjunction with the Forces of the King of Portugal for the year 1706 be 10,210 men.
that a sum not exceeding 222,379l. 5s. 10d. be granted for the 10,210 men.
that the 5,000 Land Forces now in Catalonia be continued for the year 1706.
that a sum not exceeding 96,729l. 13s. 4d. be granted for the said 5,000 men.
Subsidies to the Allies: that a sum not exceeding 414,166l. 13s. 6d. be granted for her Majesty's proportion of her subsidies to the Allies.
that a sum not exceeding 48,630l. be granted for her Majesty's share of the subsidies payable to the King of Prussia, which was not provided for in the last session of Parliament.
Bounty to the Forces: that a sum not exceeding 65,000l. be granted to make good the payment of the Bounty money bestowed by her Majesty on the Land Forces that served in the campaign in Germany in the year 1704 pursuant to the Address of the House of Commons.
Hanover Troops: that a sum not exceeding 784l. 7s. 6d. be granted to make good the additional charge to the Troops of Hanover and Zell which was not provided for in the last session of Parliament.
General Officers in Spain: that a sum not exceeding 7,631l. 16s. 8d. be granted to make good the charge of General Officers and Contingencies in the Expedition to Spain which was not provided for in the last session of Parliament.
Levy money and horses: that a, sum not exceeding 15,296l. be granted for Levy money to make good the horses of the English Horse and Dragoons that were killed and died of the common distemper in the last campaign in the Low Countries between 1 May and 31 October 1705.
Officers' horses: that a sum not exceeding 15,670l. be granted to make good the horses that were lost by the Officers of the English Troops during the last campaign in the Low Countries.
These votes of Supply were completed on the 30th November (C.J. XV, 46, Luttrell V, 618), by a series of five other votes, viz.:
250,000l. for her Majesty's proportion of the charge towards prosecuting the successes in Spain. (In the Committee stage as preserved by Luttrell this is styled simply “for the Catalonia expedition”).
120.000l. for the Ordnance Land Service.
120,000l. for the Transporting Land Forces.
3,500l. for the charge of circulating Exchequer Bills for 1706.
47,000l. for one year's interest on unsatisfied Debentures charged on Irish Forfeitures.
1706 Service Estimates (not including debt.) Supply Voted for the year 1706.
l. s. d.
Navy Ordinary [about 175,000l.] 120,000 0 0
Navy and Victualling [about 2,652,000l for 51,000 men.]. 2,080,000 0 0 for 40,000 men
Army: l. s. d.
Guards and Garrisons 453,729 13 4 357,000 0 0
Flanders, 40,000 men 886,223 18 6 880,223 18 6
Flanders, 10,000 men 177,511 3 6 177,511 3 6
Portugal 222,379 5 10 222,379 5 10
Catalonia (5,000 men) 96,729 13 4
Subsidies 414,166 13 6 414,166 13 6
her Majesty's share of the 'charge of prosecuting the successes in Spain [no Estimate] 250,000 0 0
Extra ordinaries of the War not provided for
Prussia 48,630 0 0 48,630 0 0
Bounty money 65,000 0 0 65,000 0 0
Hanover and Celle 784 7 6 784 7 6
General Officers in Spain 5,631 16 8 7,631 16 8
Contingencies in Spain 2,000 0 0
Levy money, etc. in Flanders 15,296 0 0 15,296 0 0
Horses in Flanders (4,180l., 10,880l., 610l.) 15,670 0 0 15,670 0 0
Sea Service 132,238 17 4 Sea 132,238 17 4
Land Service 172,780 18 Land 120,000 0 0
Transport 128,906 0 0 120,000 0 0
charge for circulating Exchequer Bills 3,500 0 0
One year's interest on unsatisfied debentures charged on Irish Forfeitures 47,000 0 0
total grant of Supply £5,179,761 16 2
As compared with the Estimate, or with the service requirements set out in the states of accounts given above, it will be noticed that the following Votes of Supply show a shortage
l. s. d.
Navy Ordinary—about 55,000 0 0
Navy and Victualling—about 143,000 0 0
Army (Guards and Garrisons) 104,729 13 4
Ordnance (Land Service) 52,780 18
Transport 8,906 0 0
£364,416 11
But this Shortage of Supply Vote on particular heads forms only a portion and really only a minor portion, of the full story of Parliamentary inadequacy. The growing departmental debts, yearly accruing, were ignored in the sense that no provision was made for them. Furthermore no provision whatever was made for the interest on all unfunded debt. The specific debts which were owing to the Bank of England or to the East India Company or on Lotteries or on Annuities were each provided for by their separate fund for the service thereof, for interest and/or amortization as the case might be. This is the original and true and only proper sense in which to speak of debt as “funded”. But outside this block of funded debt there were floating debts on every department and debts on the Civil List which were due entirely or almost entirely to Parliamentary action and initiative. The amount of this interest and/or amortization money required will be detailed in a moment. The point to insist upon in this connection of Estimates and Supply is that the liability was essentially and completely a parliamentary liability. Yet the House of Commons did not call for one Estimate of the interest required for the service of the unfunded debt; nor did the Executive submit any statement of it or demand for it. And as a consequence, one might almost say, quite naturally the House of Commons made no provision for it. It was merely left to accumulate until it became practically impossible to carry on the ordinary services of the country.
During this session of the Parliament which was a Whig Parliament, loyal, intensely pro-war and in apparent harmony with the Executive there was some slight show made of debating the general debt position of the country and the revenue accounts since Anne's accession. But as already shown this was purely for the purpose of putting on record a mere party vote.
The various grants of Supply thus voted, practically all for the fighting services and the war, made up a total of 5, 179, 761l. 16s. 2d. How was the money to be raised? In brief, merely in the old fashioned way. Neither in the discussions in committee of Ways and Means nor in the full debates in the House were any new forms of taxation adopted. One proposal to confiscate a fifth of the value of all grants from the Crown since the death of Charles II was put forward by the Tory group simply to provoke political reactions but it completely failed in its purpose and was not even discussed. From the commencement of the reign the Land Tax and the Malt Duty formed the mainstay of parliamentary finance. They were expected to raise about 2½ millions which meant roughly one half of the war expenditure. For the remaining half the Treasury usually fell back upon some form of long-term borrowing, lotteries or sales of annuities or Exchequer Bill issues.
The first of these expedients, the Land Tax, had by this time settled down into a very stereotyped form. Under William III the tax had taken the form sometimes of an Aid, sometimes of an Assessment. If the total contribution was fixed at a definite sum, county by county, then the tax was an Assessment proper on the lines of the assessments of the Commonwealth period which were levied and collected literally at the point of the sword. In such a type of tax the sum fixed by the Act had to be assessed and raised by county Commissioners and if the assessment or the collection fell short in any county then the shortage had to be made up by a re-assessment in that county.
The alternative form, an Aid proper, did not prescribe any figure for the total yield. It fixed a pound rate on lands, tenements and hereditaments and similarly a pound rate on the annual value of stock in trade, personal estate, professional salaries, pensions, etc.
The first Land Tax of Anne's reign, styled always 'the Fifth 4s. Aid,' combined the two types. For the Land Tax part it adopted the assessment principal with a prescribed total county by county. For the personal part it imposed a poll tax and a schedule of rates on incomes from various sources, from stock in trade, from professions and places and from pensions. This portion of the tax was styled Subsidies so that the grant was styled “Aid by a Land Tax and Subsidies.” For the Land Tax part the total expected yield was fixed at 1,979,931l. 19s. 1d.: the Subsidies portion could not be determined beforehand, but it was hoped and intended to liquidate the bulk of a sum of 650,000l. which had been borrowed by the Treasury on the strength of Votes of Credit by the House.
In this instance the two types of tax ran together in a single operation. But in the following year (1703) the Land Tax was separated from the Subsidies, a separate Act was passed for each, a total of 1,979,931l. 19s. 1d. was fixed for the Land Tax and again, in expectation that 600,000l. would come in from the Subsidies, the Treasury was authorised to borrow that sum upon security of them.
In both these instances the Subsidies portion of the tax proved a failure, as will be seen from the figures below, and for the rest of Anne's reign the 4s. Aid was a Land Tax assessment merely. The financial results of the series up to the year of the present instalment of Calendar were as follows:
The Four Shilling Aids
amount budgeted for and stated in the Act gross receipts without deduction of Receivers' charges Loans authorised by the Act and guaranteed by Parliament Loans actually taken in by the Treasury including tallies and paper orders made forth
The Fifth 4s. Aid (1702)
1,979,931l. 19s. 1d. for the Land Tax, and 600,000l. for the Subsidies 1,852,616l. 16s.d. for the Land Tax 295,667l. 13s. 11d. for the Subsidies 2,600,000l. at 8 per cent. on security of both Land Tax and Subsidies 1,450,534l. 0s. 9d. on Land Tax and 650,000l. transferred from the Vote of Credit, making a total of 2,100,534l. 0s. 9d.
Sixth 4s. Aid (1703)
1,079, 931l. 19s. 1d. 1,854,162l. 5s. 11½d. 1,800,000l. at 6 per cent. 1,800,000l.
Subsidies 1703
600,000l. 0s. 0d. 143,677l. 10s. 3d. 600,000l. at 5 per cent. 222,555l.
Seventh 4s. Aid (1704)
1,979,931l. 19s. 1d. 1,926,061l. 12s.d. 1,850,000l. at 5 per cent. 1,815,531l. 5s. 0d.
Eighth 4s. Aid (1705)
2,000,000l. 0s. 0d. 1,932,815l. 2s. 0d. 1,850,000l. at 5 per cent. 1,835.984l. 16s. 6d.
Ninth 4s. Aid (1706)
1,977,763l. 3s.d. 1,927,349l. 8s. 11d. 1,850,000l. at 5 per cent.
Principal of Loan money repaid. Interest paid on Loan money.
l. s. d. l. s. d.
Fifth 4s. Aid and Subsidies 2,100,321 1 9 79,992 16 0 on both Land Tax and Subsidies
Sixth 4s. Aid 1,879,162 8 82,357 16 11 on Land Tax
and Subsidies 295,667 13 11 15,701 11 8 on Subsidies
Seventh 4s. Aid 1,823,696 4 81,010 13 6
Eighth 4s. Aid 1,835,979 16 6 83,460 15 7
Ninth 4s. Aid 1,810,582 7 2 112,864 18 8
The general drift of this statement is easy to follow. On the Land Tax portion of the assessment there was always a shortage but not a heavy shortage. On the subsidy portion of the tax there was always a shortage and a heavy one. The gradual accumulation of the two deficiencies in the first six years of the reign produced the startling figure of over a million. The brief account in the Commons Journal (C.J. XV, p. 561) in February 1707–8 does not explain the method in which it has been calculated or what is comprised in the term “Land Tax”, so that comparison may not be scientific. The Commons statement is as follows
l. s. d.
total Land Tax granted from the Queen's accession “exclusive of the Session's grant” 11,935,321 4 0
total receipts from the said grants 10,684,071 6 7
deficit of receipts £1,251,249 17 5
These figures of the statement which I have drawn above, entirely from the ascertained and audited Revenue returns, yield a deficit which is slightly less but not seriously different. So that it is at any rate clear from the combined figures that the Land Tax, even in the fixed Assessment form, was not a satisfactory and reliable taxation source.
There are however several observations to be made on this conclusion. In the first place where the Treasury is financing the country's services on a hand to mouth principle the Land Tax shortage was not a matter of immediate embarrassment. For all practical purposes of immediate finance as then worked the value of a grant of Supply was determined by the loan clause in the Act. A grant of a Land Tax of, say, two millions generally contained a loan clause authorising the Treasury to borrow 1,850,000l. Therefore as soon as the Act received the royal assent the immediate value of the grant was 1,850,000l. the exact amount of the loan, and not a penny more. The Treasury immediately set to work to raise the loan and if only 1,200,000l. of the loan was realised in money the remaining 650,000l. was at once made out in paper orders which were issued to the various departmental paymasters as so much cash. So that for the moment the actual receipts from the tax did not much exercise the Treasury. The trouble only arose later in the year when the Lord Treasurer found that the tax receipts were not proving sufficient to repay the loans taken in on the previous year's tax. Any declared shortage on such a head could only be carried forward, as the final figures could not be known until a year or two later. In other words the Treasury was always carrying forward an undeclared unspecified amount of floating debt due entirely to the tax yield being insufficient to liquidate previous loans on tax grants. Normally this floating debt was not revealed to the House of Commons and no demand was made to the House by the Treasury for the liquidation of it. So that the floating debt on this head was carried forward until the accumulation of it began to clog the normal supplies for the services. When this happened a parliamentary inquest became necessary and some form of special provision had to be made as for a declared and acknowledged deficiency of the yield.
Secondly it is abundantly clear that no scientific investigation had ever yet been made of the cost of collection of a Land Tax. The various Acts only provided for a varying penny rate to the Receivers General. But this rate was inadequate even for costs of collection and it completely ignored the expenses which the Receivers were put to in forwarding their moneys to the Exchequer. Where bills of exchange were not available the Receivers had to forward their moneys by road under charge of a military guard. The costs of the guard were borne by the Receiver and he could only recoup himself by petitioning the Treasury to allow the charges in his account. These petitions were always put forward long after the event, in some cases years after. They were always scrutinised and frequently disallowed in part and there are many instances recorded in the course of this Calendar of Receivers failing and undergoing imprisonment because the disallowance of their charges prevented the passing of their accounts.
But whether allowed or not the items of poundage and extraordinary expenses always operated in reduction of the yield of the tax. They were deducted from the receipts before the striking of the balance of the net yield. In this way or as a result it would be quite impossible to calculate the actual cost of collection of the Land Tax in any year.
A further complication was introduced in the case of the Fifth 4s. and the Sixth 4s. by the overlapping between the Land Tax part and the Subsidy part of the Tax. The brief statement, already quoted, in the Commons Journals of February 1707–8 contains a clause explaining that the 'receipts' figure of 10,684,071l. 6s. 7d., included a sum of 323,248l. 6s. 1d. paid to Receivers, Collectors and Commissioners and also included what the Land Tax fell short in the year 1702 and 1703 by certificates in abatement of the personal estates which were in those years granted in the Subsidy Acts.
From these two items, alone, of collection costs and cross entries it will be seen that the House of Commons was confronted with a formidable task when discussing the value of a Land Tax as an item of Supply. The difference between the gross and the net yield was impossible to forecast. A Land Tax of 2,000,000l. on which a loan of 1,850,000l. was authorised might easily come down to a net figure which was below the 1,850,000l. loan limit.
In the third place and most inexplicable of all the House of Commons absolutely ignored the question of interest on the authorised loan. From the figures printed above, p. xxiv, it will be seen that on an average the Treasury paid more than 80,000l. a year for interest on loans on Land Tax. The Treasury had to provide or find this interest money as and where it could. No provision whatever was made by the House of Commons for it. To my mind the only sensible way of treating such an item is to reckon it as a deduction from the gross yield of the tax. In this way the deficit of the Land Tax for the first six years of Anne's reign as stated in the Commons Journals supra p. xxiv, would be as follows
l. s. d.
deficit as stated in the Journals of the House 1,266,913 17 5
plus collection costs, etc. 323,428 6 1
plus interest paid on an average of 80,000l. a year for 6 years 480,000 0 0
total deficit on 6 years' Land Tax, roughly £2,070,342 3 6
The second item of Ways and Means for the Supply of the year 1706 was the Malt Duty, which was a short name for a congeries of Duties on malt, mum, cider and perry, viz. 6 pence per bushel on malt, 10s. per barrel on mum, and 4s. per hogshead on cider and perry. These duties were comparatively a new form of taxation. But although young by the side of the Land Tax they had already by 1705 become stereotyped in form. They were first resorted to in 1696–7 as a fund for the Malt Lottery which was instituted by the Act 8–9 Wm. III, c. 22. For the purposes of that Act the Duties were intended as a fund or fond of credit to raise and to liquidate a loan of 200,000l. and a lottery of 1,200,000l. or a total of 1,400,000l. and in order to enable the fond to accomplish its work of liquidation the Duties were granted for 2½ years viz. from the 20th April 1697 to the 20th July 1699. This calculation implies an expected yield of say 700,000l. per an. for the Duties, viz. 200,000l. for the loan, 1,200,000l. for the lottery, and another 115,000l. for interest and for lottery prizes or benefits.
The 200,000l. loan was liquidated in the first of the 2½ years' period quite easily out of the yield of the Duties but the Lottery was a complete failure. Only 1,793 of the 10l. Malt Tickets were sold and the unsold tickets were handed back to the Exchequer by the Lottery managers. To prevent a credit crash such as overtook the Treasury on the failure of the Land Bank scheme, the Lord Treasurer issued the unsold Malt tickets to the fighting services (871,940l.) and to the Civil List (266,473l.) as so much paper credit and the services were left to finance themselves either by sale or pledge of the tickets. Periodically the drawings for the Lottery took place just as if the flotation had been a success and the prizes were added to the tickets strictly in accordance with the results of the original benefit drawing which had taken place in August 1696. At each drawing the Treasury issued the face value of blanks and prizes to the Paymaster of the Lottery and he paid out the sum and retired the drawn tickets. In this way by the time the 2½ years' grant had expired something over a half of the unsold Malt Lottery tickets had been drawn, paid and sunk and when the second Deficiencies Act (1 Anne, c. 7) was passed the remaining liability for the unretired balance resting on the shoulders of the Lord Treasurer and clogging up the services was calculated at 579,060l. plus interest accruing at the rate of a halfpenny a day for each 10l. ticket, such interest money representing approximately 7½ per cent. Furthermore, in order to assist the Deficiencies Fund a charge or appropriation of 42,425l. 15s.d. was imposed on the Fifth 4s. Aid (1 Anne, c. 6) to pay one year's interest to Lady day 1700 on the unretired Malt Lottery Tickets.
By the means of such external financial assistance the Malt Lottery Tickets were gradually sunk and in the end wholly liquidated by periodic drawings, each drawing accounting for so much principal money, so much in interest and so much in prizes or benefit money. The whole series of these drawings will be found ambulando in this Calendar up to the point of total extinction of the debt see for instance Treasury Calendar, vol. XXIII, pp. 135–6. The whole operation has been already described at p. cci of the Introductions to vols. XI to XVII of this Calendar. Rut when the story of this chequered financial operation of the Malt Lottery has been told there is little of scientific value deducible from it. Either the yield from the tax had been over estimated from the first or the working machinery of it had been unsatisfactory (see Davenant 'Discourses on the Public Revenue,' p. 109). The total receipts for the whole period of the tax viz. from 20 April 1697 to 20 July 1699 had sufficed only to liquidate the 200,000l. loan and one half of the outstanding tickets and when, three years later, we hear of a Malt Duty surplus that phrase was only made possible by the fact that the accruing receipts of the Duty were at the disposal of the Treasury because the liability for the Lottery had been transferred to the shoulders of the Deficiencies Act.
In the last year of William's life the House of Commons again turned to the Malt Duties as a source of Taxation Supply. The Act of 13–14 Wm. III, c. 5, was passed in William's last parliament. As this parliament ran on for the first three months of Anne's reign, the Act is regarded and spoken of as an Act of the first year of Anne, all the more because the term or period of the grant ran from the 9th March 1701–2 to the 24th June 1703, that is a year and about four months. From that time onwards the grant became a yearly one by the simple device of passing a renewal or continuation Act, the scale of the Duties being the same all through.
Up to the date of the present instalment of Calendar the series of the Malt Acts was as follows
(1) 8–9 Wm. III, c. 22 the Malt Lottery Act granted the Duties for 2¼ years viz. from 20 April 1697 to 20 July 1699.
This Act provided that if by the 20th April 1698, that is at the end of the first full year, the Duties had not realised 800,000l. then the deficiency was to be charged on the first Aid to be granted by Parliament after that date: and if by Michaelmas 1699 the Duties so supplemented had not produced 1,515,000l. then once more the deficiency was to be charged on the next aid granted by Parliament.
(2) The Act of 13–14 Wm. III, c. 5, for the supply of the year 1702–3. This Act reinstituted the same Duties after a gap or lapse of 2¾ years, that is from 20 July 1699 the termination of the first Act to the 9th March 1701–2 the commencement of this second Act. The Act granted the Duties for 1¼ years viz. to the 24th June 1703 and contained a loan clause authorising the Treasury to take in loans up to 600,000l. on credit of the Tax. In the first quarter up to 24 June 1702 the Duties produced 279,117l. 10s. 4d. and in the remaining twelve months they produced a further 645,344l. 0s.d. The combined yield was 924,461l. 10s. 11¾d. and out of this sum the Treasury repaid, within the life of the tax, the loan of 600,000l. and a separate loan of 228,490l. 14s.d. (described as a loan on the Malt surplus) and two separate sums of interest amounting together to 22,544l. 1s. 4d.
(3) The third Malt Act is that of 1 Anne, st. 2, c. 3, which renewed or continued the same body of Duties from the 23rd June 1703 to the 23rd June 1704. This Act contained a loan clause authorising the Treasury to borrow 600,000l. The sum actually borrowed however fell considerably short of that limit. The produce of the Duties in the year was only 459,824l. 11s.d.; the amount borrowed by the Treasury on it was 475,677l. and the repayments totalled 409,785l. 7s. 4d. for principal money, together with 27,148l. 19s. 10d. for interest.
(4) The fourth Malt Act was that of 2–3 Anne, c. 2, which like its predecessor simply continued the same Duties for another twelve months, from 23 June 1704 to 23 June 1705. In that period the produce of the Duties was 639,831l. 9s. 3d. plus certain small arrears. The loans taken in on the Duties amounted to 315,039l. 12s. 8d. in money and a further 10,000l. in tallies issued by the Lord Treasurer. The repayments of loan money amounted to 565,544l. 1s. 5d. and the interest money paid came to 26,168l. 11s. 0d. The Act contained no loan clause, but this omission was repaired by clause 16 of 2–3 Anne, c. 18, an Act of the same session which granted the One Third Tonnage and Poundage.
(5) The fifth Malt Act was that of 3–4 Anne, c. 17, which in its turn once more renewed the same corpus of Duties for the succeeding year 23 June 1705 to 23 June 1706. The receipts from this grant were 526,940l. 13s.d. not reckoning the items of arrears for preceding grants.
The loan clause in the Act authorised the Lord Treasurer to borrow 650,000l. at 6 per cent. on the Act, but the amount actually borrowed on it only came to 109,142l. 7s. 3d., that is 50,970l. in money and 58,172l. 7s. 3d. in tallies. The total repayments within the period of the grant came to 500,267l. 13s. 10½d. and the total interest paid on the loan money within the same period was 32,650l. 10s. 9d.
I have particularised the financial history of these Duties in the vain hope of deducing an average for the yield or value of them as a taxation source. Leaving the Malt Lottery out of account altogether the Duties had produced in four consecutive years
l. s. d.
645,344 0
459,824 11
639,831 9 3
526,940 13
£2,271,940 14
The average annual yield was therefore roughly something less than 568,000l.
As an approximation this is probably as near correct as we can get and at any rate it is impossible to check the figure by the Declared accounts, for the reason that the Revenue or Budget figures, the Exchequer figures, given as above are for a financial year which ran from Michaelmas to Michaelmas whereas the Declared accounts for Malt as well as for the Excise generally ran from midsummer to midsummer. The safest guide to take would perhaps be the cash account of the Malt Duty as declared by the Excise Commissioners, because the cash account gives the net yield after deduction of all charges and allowances. According to these accounts the net payments into the Exchequer from these Duties were as follows
in the year from midsummer to midsummer
l. s. d.
1704–5 414,290 14 7½ for current Duty
171,506 7 0½ for arrears
£585,797 1 8
1703–4 298,216 1 1 for current Duty
89,500 17 2½ for arrears
£387,716 18
1702–3 486,573 6 1 for current Duty
1,241 14 10½ for arrears
£487,815 0 11½
These figures would yield a considerably lower average. We are compelled to grope in the dark in attempting to ascertain what figures of gross and net yield the Committee of Supply in the House of Commons had before it during discussions on Ways and Means. This is due to the fact that such accounts as are not entered in full in the Journals perished presumably in the fire, and we do not possess any illuminating account of debates in Committee of Supply or in Committee of Ways and Means. Such information as Luttrell's Diary gives on this subject is confined generally to a statement of the resolution taken and as a rule his statements are merely repeated more authoritatively in the Journals in the Report to the House on the following day.
But it would be safe to infer that in Committee of Ways and Means the yearly value of the Malt Duties was put at 700,000l. or something more and that they were considered good security for a loan of 650,000l. To say that this was an overestimate is simply to say what is demonstrably true of all the figures adopted by the House of Commons during debates on Supply throughout the reigns of William III and Anne.
In Luttrell's Diary (VI, p. 6) there is an entry under the 17th January 1705–6 as follows
Yesterday the Commons in a Committee of Ways and Means resolved that the 5s. per chaldron on coals, culme etc., be further continued from the 14th May 1708 to the 30th September 1710.
Tomorrow it's expected they'll resolve that the additional 9d. Excise per barrel on beer and ale etc. shall be continued for 98 years; which with the additional Tonnage and Poundage already voted will be a sufficient fund for raising 2,500,000l. which will complete the sum required this Session.
These two separate Resolutions were reported to the House on the 18th and 21st January respectively (C.J. XV, pp. 98, 102) and were in each case agreed to by the House. The second of the two Resolutions, that relating to the establishing of a fond for 99 year annuities, was adopted in the following terms
“Mr. Conyers, according to order reported from the Committee of the whole House to whom it was referred to consider of Ways and Means for raising the Supply granted to her Majesty, the Resolutions which they had directed him to report to the House; which he read in his place and afterwards delivered in at the Clerk's table, where the same were read and are as follows viz.
Resolved, that it is the opinion of this Committee that the Duties of Excise on beer, ale, cyder and other liquors granted by an Act of Parliament in the fifth year of their late Majesties King William and Queen Mary for 16 years to commence from the 17th day of May 1697 and [which] are charged with such Lottery Annuities as are therein mentioned for a term of years which will expire at Michaelmas 1710, be continued from the expiration of the said term granted of the said Duties by the said former Act, [to wit that they be continued] for a term of 95 years from thence [to wit from Michaelmas 1710] next ensuing.
Resolved: that it is the opinion of this Committee that towards the Supply granted to her Majesty the sum of 2,573,761l. 16s. 2d. be raised by the sale of Annuities for the term of 95 years to commence from Lady day now next ensuing.
Resolved: that it is the opinion of this Committee that the Additional Subsidy of [One Third] Tonnage and Poundage, the Duties on coals, culme and cinders and the [above] said Duties of Excise on beer, ale, cyder and other liquors granted or continued in this session of Parliament, as those branches respectively shall commence and take place, be charged with annuities to be sold as aforesaid.
Resolved: that it is the opinion of this Committee that the Duties of Excise granted by the said Act of the 5th year of their late Majesties, after the Lottery annuities therein mentioned shall be paid off, or sufficient money shall be reserved [in the Exchequer] for paying off the same, shall be applied towards the payment of the annuities now to be purchased.
Resolved: that it is the opinion of this Committee that so much money (over and above the produce of the said Additional [One Third] Subsidy of Tonnage and Poundage) as shall be necessary to discharge the annuities to be purchased as aforesaid, for the first two years of the said [95 years'] term be raised and kept in the Receipt of the Exchequer and issued from time to time for that purpose.
Resolved: that it is the opinion of this Committee that the like Duties upon Low Wines or Spirits of the first extraction as by an Act of the third year of her Majesty's reign are continued from the 24th day of March 1706–7 be made payable from the 24th day of March 1705–6 until the commencement of the said former Act [i.e. until 24 March 1706–7] for the uses and purposes in that Act expressed.
These Resolutions were agreed to by the House straight away without any change and were ordered to be drawn up as a Bill. In its final form the Act for annuities (4–5 Anne, c. 18) continued the One Third Tonnage and Poundage for 98 years, the Ninepenny Excise for 95 years and the Coal Duty for 2½ years to 30 September 1710. These provisions and the above quoted Resolutions are so involved as to require more precise explanation. The Committee of Supply was faced with the task of finding Ways and Means for the balance of Supply already voted by the House. The total Supply voted was 5,179,761l. 16s. 2d. and towards that total the House had already voted a Land Tax which was supposed to be good for a loan of 1,850,000l. and Malt Duties supposed to be good for a loan of 650,000l. These two loan amounts made a total of 2,500,000l. and therefore left a balance of 2,679,761l. 16s. 2d. of Supply for which Ways and Means had yet to be found. In effect the Committee of Ways and Means decided to raise the sum by a 99 years' loan operation which took the form of a sale of annuities terminable in 99 years.
The figures which the Committee had before them seem to have been slightly different from the above. They fixed the total sum to be provided or raised at 2,575,761l. 16s. 2d. and they decided to raise it by the sale of annuities at 15 years purchase which would mean 62/3 per cent. valuation: at this rate the total yearly sum required to pay the annuities would be 171,584l. 2s. 5d. To raise that annual sum the Committee could have instituted absolutely fresh new and untried sources of taxation or it could have fallen back on old and well known sources. It decided on the latter alternative and after a search all round it pitched upon three Duties or sets of Duties which were still in existence but which were near the point of expiry and which would therefore be available for renewal at some near date. The Duties were
(1) the One Third Tonnage and Poundage
(2) the ninepenny Excise which was carrying the Sixteen years Lottery Annuities
(3) the Duties on coal, culme and cynders.
The One Third Subsidy of Tonnage and Poundage was first granted by the Act 2–3 Anne, c. 18, for 3 years from 8th March 1703–4 as a fund for liquidating a loan of 300,000l. It would therefore not expire or become available as a source of new revenue until the 8th March 1706–7.
The second Duty viz. the Ninepence per barrel Excise had been first granted by the Act 5–6 William and Mary, c. 7, for 16 years from 17 May 1697 as a fund to meet the annuities of the Million Adventure. This liability would not expire until the 17th May 1712 and it would only be available at that date if all the annuities liability of the Million Adventure had been provided for.
The third Duty, that on coal, culme and cinders, had been renewed or continued from 14 May 1703 to 15th May 1708 by the Act 1 Anne, st. 2, c. 4, and was saddled with the liability of a loan of 500,000l. As a source of revenue therefore to meet the 1706 annuities it could only become available at the earliest by 15th May 1708 and then only if it had cleared off all its prior debt liability. The net position therefore was that in order to meet the service of these 1706 annuities there was no revenue at all in sight. The One Third Tonnage would only become available in March 1706–7, the coal Duties in May 1708 and the Excise 9d. in May 1712. Instead of adopting other sources of taxation to provide for the interim service of the annuities the House of Commons, both in Committee and in full House, fell back on the idea of borrowing still more money in order to pay the annuities for the first two years. Instead of raising 2,575,761l. 16s. 2d. by the sale of annuities the Commons decided to raise 2,855,761l. 16s. 2d. by selling annuities up to a yearly total of 184,242l. 14s. 0d. at the rate of 15½ years' purchase. The upshot was that for a temporary two years' relief the nation would have to pay interest on interest for 95 years. Any modern rake or prodigal son who sells a reversion in order to pay interest to a money lender shows as much financial acumen and as much essential honesty as did the House of Commons in such a decision. And at that the Executive was supposed to be firmly in the saddle and possessed of a working majority in the House, a majority composed largely of a solid body of the Whigs who by their own utterances were committed to the unflinching prosecution of the war against Louis XIV. This was within little more than a year of the victory of Blenheim.
In the finish it turned out that the total subscription fell short. The sum raised within the financial year 1705–6 by the sale of these annuities was only 2,272,780l. 14s. 7d. and from this total, or from any other revenue source so liable, a sum of approximately 350,000l. fell to be deducted by being impounded in the Exchequer for the purpose of meeting the first two years' annuity payments and another 11,000l. for rebate on subscription payments. In reality therefore the annuity subscription operation only produced about 1,900,000l. for the services for the year 1706, as against the balance of Supply required which I make to be 2,679,761l. 16s. 2d. but which the Commons Committee calculated at 2,575,761l. 16s. 2d. Whichever figure is taken there was a Supply shortage of not less than 600,000l. on this head.
The above survey of the revenue sources on which Parliament depended for the service of the year 1706 has revealed the general inadequacy of those sources. The loans on the Land Tax amounted to only 1,379,939l. 3s. 10d. in money, and in order to make up the required figure of 1,850,000l. the Lord Treasurer had to make out paper orders for the balance viz. 470,040l. 16s. 2d. The loans on the Malt Duty amounted to only 299,073l. 17s.d. in money, and in order to make up the balance of 650,000l. the Lord Treasurer had to make out paper orders for the balance viz. 350,926l. 2s.d. The effective yield of the subscriptions for Annuities amounted to about 1,900,000l. instead of 2,855,761l. 16s. 2d. Counting the paper orders as equivalent to cash (which they certainly were not) the total actual or prospective yield of Parliamentary Supply for the year 1706 was
1,850,000l. for Land Tax
650,000l. for Malt Duties
1,900,000l. for Annuity subscriptions
This was against a total voted Supply of 5,179,761l. 16s. 2d. The visible deficit therefore was practically 740,000l. merely on the head of the three fighting services, Navy, Army, Ordnance and Transport. On the Civil List as will be seen from the figures on pp. cxl–cxliii infra, there was a shortage of close on 125,000l., making a total shortage of 865,000l. on the revenue side of the Budget.
Briefly summarised the actual issues of public money for the year Michaelmas 1705 to Michaelmas 1706 were as follows:
Payments to the Navy— l. s. d.
on account of the year 1705 213,343 11
on account of the year 1706 1,829,964 18 7
total 2,049,308 10
Payments to the Ordnance— l. s. d.
on account of the year 1704 22,350 0 0
on account of the year 1705 80,000 0 0
on account of the year 1706 130,000 0 0
total 232,350 0 0
Payments to the Forces—
to James Brydges for the Forces Abroad, for Flanders, Portugal, Spain, Subsidies, Gibraltar and extra-ordinaries: l. s. d.
on account of the year 1704 2,004 10 0
on account of the year 1705 372,101 10 2
on account of the year 1706 1,924,580 14 4
2,298,686 14 6
to John How for the Guards and Garrisons, the 5,000 men and Invalids:
on account of the year 1703 7,071 13
on account of the year 1705 122,417 15 0
on account of the year 1706 219,856 13 2
351,487 5 10¼
Payments for Transports 58,545 8 9
Payments to Charles Fox for arrears to the Forces Abroad for Flanders, Portugal and extraordinaries:
on account of the year 1703 773 9 0
on account of the year 1704 22,743 9
on account of the year 1705 41,338 0 0
64,854 18
Payments to the Earl of Ranelagh for arrears to the Forces:
on account for the year 1702 345 13 0
Payments to the Civil List:
of the late King 2,236 2
of the Queen 628,109 16
603,345 18
Payments for Plantation Governors, Poor Clergy, Mint, annuities, perpetuities, etc. 773,892 14 11
Payments for interest money on Loan Registers 357,105 12
Repayments of Loan money in excess of money borrowed 535,855 9
Comparing the above figures of issues with the figures of the Supply voted by the House of Commons we obtain the following result.
During the financial year Michaelmas 1705 to Michaelmas 1706 the Lord Treasurer issued to the Navy 2,049,308l. 10s.d. Of this total the sum of 213,343l. 11s.d. was on account of arrears of the preceding year 1704–5 so that the current services of the Navy for the year here treated of received only 1,829,964l. 18s. 7d. This represented 370,035l. 1s. 5d. shortage of Supply as against the votes supra.
l. s. d.
2,080,000 0 0 Navy and Victualling.
120,000 0 0 Navy ordinary
2,200,000 0 0 total Estimate
1,829,964 18 7 total Supply
370,035 1 5 issue shortage for the Navy
The totals of the Army Supply Votes (supra pp. viii-xii) including Subsidies and Extraordinaries were
l. s. d.
357,000 0 0 for Guards and Garrisons
2,200,022 18 2 for Army Abroad
2,557,022 18 2
Towards this Supply Vote the Lord Treasurer issued 351,487l. 5s. 10¼d. for Guards and Garrisons and 2,298,686l. 14s. 6d. for the Army Abroad. But from these sums are to be deducted such amounts as were paid for the services of previous years as follows
l. s. d.
Guards and Garrisons, on account of the year 1703 7,071 13
Guards and Garrisons, on account of the year 1705 122,417 15 0
129,489 8
The deduction of these debt payments left only 219,856l. 13s. 2d. for the current year's service of the Guards and Garrisons. Similarly for the Army Abroad in all the theatres of the war the issues included
l. s. d.
2,004 10 0 for account of year 1704
372,101 10 2 for account of year 1705
374,106 0 2
The deduction of this sum left 1,924,580l. 14s. 4d. for the service of the War abroad for the year 1706. There was therefore a shortage on these heads as follows
l. s. d.
Guards and Garrisons Estimate 357,000 0 0
issues 219,856 13 2
shortage 137,113 6 10
l. s. d.
Army Abroad Estimate 2,298,686 14 6
issues 1,924,580 14 4
shortage 374,106 0 2
These Army payment shortages together came to 511,249l. 7s. 0d.
For the Ordnance the Lord Treasurer issued within the year 232,350l. but of this total the sum of 22,350l. was on account of the year 1704, and 80,000l. was on account of the year 1705. There was therefore left for the service of 1706 only the balance of 130,000l. as against the voted Supply of 252,238l. 17s. 4d. This left a payment shortage of 122,238l. 17s. 4d.
For the Transport service the House had voted 120,000l., but towards that vote the Lord Treasurer only issued 58,545l. 8s. 9d., leaving a shortage of 61,454l. 11s. 3d.
The combined shortages therefore of the fighting services were
l. s. d.
shortage for the Navy 370,035 0 0
shortage for the Guards and Garrisons 137,143 6 10
shortage for the Army Abroad 374,106 0 2
shortage for the Ordnance 122,238 17 4
shortage for the Transport 61,454 11 3
total shortage for the fighting services for the year Michaelmas 1705 to Michaelmas 1706 £1,064,977 15 7
It will be noticed from the account of moneys borrowed and repaid within the year infra pp. cxxxiv–cxxxvii that beyond the above loan items there was a further amount of 620,600l. 5s. 3d. taken in loan on various minor items. But these latter loans were all on account of the service of previous years viz. 1704 and 1705 and it is this item which explains the fact that the repayments of loan money within the year exceeded the moneys borrowed by 535,855l. 9s.d. These two figures being set against each other would leave a balance of 90,000l. odd to the good on the head of loan and although this balance was or technically should have been earmarked for the service of 1704 and 1705 the Lord Treasurer made use of it temporarily. Taking the item to credit of revenue and deducting it from the revenue shortage of 865,000l. ut supra p. xxxix, it would leave the shortage of realised revenue at about 775,000l. To this must be added 357,105l. 12s.d. for the amount of interest paid on the floating debt as distinguished from the funded debt ut infra p. cxxxi. We thus reach a total shortage of approximately 1,130,000l. on the budgetary supply for the year.
All this calculation is based on the assumption that the services did not exceed the figures as in the Estimates supra p. xx, that is that the Navy did not employ more than 40,000 men and that the Army effectives did not exceed the figures set down for Flanders, Portugal, Spain, and Savoy.
It is needless to ask how this shortage of Supply affected the Treasury. Such a shortage always meant and always must mean a postponement of regular payments, and therefore an increase in the floating debt, at a time when the management of floating debt was still not understood, when Ways and Means Advances and Treasury Bills were not existent. Much more vital was the question how did the shortage affect the services themselves or the war itself. The answer can only be and is demonstrable that at a time of imperfect financial machinery the increased floating debt fell not on the Executive so much as on the poor soldiers and sailors and pensioners, not to speak of the tradesmen, army clothiers, transport shipowners, the Household tradesmen and others.
By the above process of calculation we have almost balanced the shortage of revenue with the shortage of service expenditure as follows
l. s. d.
1,130,000 0 0
shortage of revenue less tallies and paper in hand used as revenue during the year, being the difference between 316,832l. 6s. 8d. of tallies and orders in hand at the commencement of the year and 223,091l. 9s.d. in hand at the end of the year 93,000 0 0
final net revenue shortage 1,040,000 0 0
l. s. d.
shortage in service issues 1,064,977 0 0
less final excess of repayments of loan money 90,000 0 0
net final shortage of issues 974,977 0 0
These two shortages are therefore within 90,000l. of each other.
This conjectural balancing of budget figures leaves out of view altogether the gap between the formal Estimate and the actual requirements of the services upon which I have already animadverted, pp. xv–xvi. If we take this feature into consideration it only increases the weight of the strictures which must be passed upon the mere politician of the day or upon the House of Commons. The House took Estimates which it knew to be an under-statement, they voted Supply even below those Estimates and granted Ways and Means provisions which they must have known could not possibly realise that Supply. In coping with such recalcitrance Godolphin had as intolerable a burden to bear as Marlborough had in dealing with the military delinquencies and factiousness of the Dutch.
In conclusion it must be pointed out that as the Votes of Supply during the Session made no provision for service debts the shortage of payments can only be construed as an increase of the floating debt. At the end of the year therefore the debt increase was a round million for the floating debt and a round 2¼ millions or more on the funded debt viz.: by the Annuity contributions. The debt creation nearly equalled the revenue contribution taking everything at face value. If the future valuation of the Annuities were stated the revenue contribution would appear much less than the debt creation.