cannot, with safety to itself, or benefit to the nation, resume payments in cash, till such a reformation takes place in the system of provincial banking, as will give that paper a palpable security.

That there are in the kingdom many solid private banking establishments, conducted by men of great opulence and probity, is very certain, and these persons could be put to no material inconvenience by giving their notes the evident and tangible security so desirable.

They cannot be making greater interest than may be obtained in the Public Funds, of the money which their notes represent, without employing it, hazardously in trade, usury, or speculation of some kind, and if they do this, it must be evidently at the risk of those who possess their paper. The measure proposed will, therefore, form a test of solvency and prudence, adding at he same time to the respectability and consequence of those who adopt it, and affording just grounds for suspecting the solidity of those who do not.

At His late Majesty's accession to the throne there was

gold in circulation

From the year 1760 to 1773, there was coined

From 1773 to 1777

From 1777 to 1778

L. 25,000,000

10,000,000 20,447,002 33,831,236

£. 89,278,238

In place of the much greater part of this immense sum, in the precious metal, the country possesses nothing but the notes of private bankers, bearing no other evident security than their 'promise to pay.' The increase in the circulation of the Bank of England notes has borne no proportion to the abstraction of the gold currency; for of the 25 millions of those notes now out, only the 9 millions of 11. and 21. notes can be said to stand in the stead of the gold; consequently it is most evident, that it is the country paper that has so injuriously displaced the coin-injuriously, it must be acknowledged, as long as that medium possesses no other security than it has hitherto done, when it is considered that the failures have on an average amounted for many years past to upwards of a million a year.

Note (B.)

"To restrain private people, it may be said, from receiving in payment the promissory notes of a banker, for any sum, whether great or small, when they themselves are willing to receive them; or, to restrain a banker from issuing such notes, when all his neighbours are willing to accept of them, is à manifest violation of that natural liberty which it is the proper business of law not to infringe but to support. Such regulations may, no doubt, in some respect be considered a violation of natural liberty. But those exertions of the natural liberty of a few individuals, which might endanger the security of the whole society, are and ought to be restrained by the laws of all governments, of the most free, as well as of the most despotical. The obligation of building party-walls, in order to prevent the communication of fire, is a violation of natural liberty, exactly of the same kind with the regulations of the banking trade which are here proposed."

"A paper money consisting in bank-notes, issued by people of undoubted credit, payable upon demand without any condition, and in fact always readily paid as soon as presented, is, in every respect, equal in value to gold and silver money."-A. SMITH's Wealth of Nations, vol. i. p. 489.

APPENDIX.

Abstract of a Bill to authorise Bankers, in England and Ireland, to issue and circulate Promissory Notes, secured upon a Deposit of Public Funds, or other Government Securities. 10th April,

1818.

The Preamble of the Intended Act stated, that, Whereas the Circulation of Promissory Notes, by Bankers in England and Ireland, the Payment whereof shall be secured on the Deposit of Property vested in certain Public Stocks or Funds, or other Government Securities, will be highly beneficial to the internal Trade and Commerce of the Kingdom:

And whereas by an Act passed in the Seventeenth year of the Reign of His present Majesty, intituled, " An Act for further restraining the Negotiation of Promissory Notes and Inland Bills of Exchange, under a limited Sum, within that part of Great Britain called England," the Negotiation of Promissory Notes and Inland Bills of Exchange in England, for Twenty Shillings and under Five Pounds, is restrained, in manner in the said Act provided:

And whereas by an Act made in the Thirty-seventh year of the Reign of His present Majesty, the said recited Act of the Seventeenth year, so far as the same relates to the making void, or to the restraining the publishing or uttering and negotiating of Promissory Notes, Drafts or Undertakings in writing, payable on demand to the Bearer thereof, for any Sum less than the Sum of Five Pounds in the whole, was suspended for the period in the said Act mentioned:

And whereas the period of such Suspension was by an Act passed in the Fifty-sixth year of His Majesty's Reign, continued until two years after the expiration of the Restriction upon Payments in Cash by the Bank of England;

.

That after a time to be fixed, the Restriction of 17 G. 3, c. 30, shall be repealed, as to all Notes under 57. issued under the Authority of this Act, in manner and under the Regulations hereinafter mentioned, by Bankers duly licensed or registered according to Law.

That Bankers desirous of issuing Notes secured on their Property, vested in certain Public Funds, may apply at the Bank of England or Ireland, or South Sea House in London, to transfer such Funds to the Commissioners for the Reduction of the National Debt; and thereupon, and upon such Banker or Bankers transferring such Stocks, Funds or Annuities, or any part thereof, in the Books of the Governor and Company of the Bank of England, or Bank of Ireland, or South Sea House, respectively, into the names of the said Commissioners for the Reduction of the National Debt, in a special Account to be opened at the said Banks and South Sea House respectively, for the purposes of this Act, it shall and may be lawful for the Governor or Deputy Governor of the Bank of England or Ireland, or South Sea Company, for the time being, respectively, and they are hereby respectively authorised and required, to grant a Certificate to the Banker or Bankers, or other Person or Persons making such Transfer, directed to the said Commissioners for the Reduction of the National Debt (and which Certificate shall be also according to a Form which shall be established by the said Governor and Company of the Bank of England, Ireland, and South Sea Company, respectively, and shall be the same in all cases,) and such Certificate shall state, that the Person or Persons therein mentioned, hath or have transferred the Stocks, Funds or Annuities therein described, to the said Commissioners for the Reduction of the National Debt, for the purposes of this Act.

That the Commissioners for the Reduction of the National Debt shall establish Offices or appoint Agents in London and Dublin for the purposes of this Act, and keep proper Books, &c. there for the purposes of This Act, and relating respectively to the several Stocks, Funds or Annuities, or other Government Securities, to be transferred or deposited for the purposes of this Act.

That on production of Certificates of Transfer of Stock at such Offices, the Sums so transferred shall be placed to the account of the Proprietors in the Books of the Commissioners.

That after a date to be fixed, Bankers may deposit Exchequer or Treasury Bills with the Commissioners for the Reduction of the National Debt, for the purpose of issuing Notes on the Security thereof, and that the said Commissioners shall, upon such Deposit or Assignment, write or cause to be written into the Books of the said Commissioners for the Reduction of the National Debt, to be kept at such Offices for that purpose, the Principal Sums specified and contained in all and every such Exchequer or Treasury Bill or Bills so deposited or assigned, in the name or names, or to the account of the Party or Parties depositing or assigning the same; and every Deposit and Assignment of such Bills shall be made in

such manner and form, and under such Rules, Regulations and Restrictions, as the said Commissioners for the Reduction of the National Debt shall for that purpose think fit to make, order and appoint, from time to time, in that behalf.

That Bankers having transferred such Stock, or deposited such Bills, may make out Notes under 57. and not less than 20s. to the Amount of half the Capital of the Stock, or the whole Principal of the Treasury Bills so deposited or assigned by such Banker or Bankers respectively; and the said Notes shall be in the form of Notes usually given by any such licensed or registered Banker or Bankers in England or Ireland respectively, or in such other Form as the said Commissioners for the Reduction of the National Debt shall think fit to direct; and every such Note shall be made payable to the Bearer on demand, and shall be signed and subscribed by or on behalf of the Banker or Bankers so having transferred such Stock, or deposited or assigned such Bills, and shall be made payable at some Place or Places in England and Ireland respectively, to be mentioned and specified in every such Note; and every such Note shall be subject and liable to such Stamp Duty as Notes of the like Amount reissuable by Bankers in England or Ireland, respectively, are subject and liable to, under any Act or Acts in force at the time of the passing of this Act.

That previous to such Notes being issued or circulated by Bankers, they shall be entered and registered at the Offices of the Commissioners for the Reduction of the National Debt, for the purposes of this Act, on Payment of 2s. 6d. per cent on Stock, and 5s. on Exchequer Bills, or Treasury Bills, so deposited by such Banker or Bankers; and all such Notes shall and may be issued and circulated, and shall and may be reissued and reissuable by such Bankers, from time to time, after payment thereof, as often as shall be thought fit in England, and at any time within the term of years from the date thereof in Ireland, in such manner as Notes of the like amount are allowed to be issued or reissued by Bankers in England and Ireland respectively, under any Act or Acts in force immediately before the passing of this Act.

That when Notes are presented for payment, they may either be paid by the Banker, or be assigned by Indorsement for Payment at the Office of the Commissioners for the Reduction of the National Debt, for the purposes of this Act, in London or Dublin, as the case shall require.

That Commissioners, in case of Notes issued on Deposit of Stock, and presented to them, shall either sell sufficient Stock of the Party, or transfer a like Amount to their General Account, and pay the Notes, which shall be cancelled, but that the Capital of Stock transferred shall in no case exceed twice the amount of

the Notes, and if such Portion of Capital is not sufficient to pay the Notes, the Holders may take such Portion of Stock in satisfaction; or otherwise it shall be transferred in part payment, and the Holders may proceed at Law for the Balance within One Month; on failure of which, such Transfer shall be taken and pleadable as a satisfaction.

And that for the ascertaining the Price at which such Stocks, Funds or Annuities, shall and may be so transferred by the said Commissioners for the Reduction of the National Debt, in payment and satisfaction of any such Notes in manner aforesaid, the Chashier or Cashiers of the Governor and Company of the Bank of England and Bank of Ireland, and of the South Sea Company respectively, shall, and they are hereby required, on every day on which any such Stocks, Funds or Annuities transferrable at the said Banks, and at the South Sea House respectively, shall have been bought at either of the said Banks or South Sea House respectively, to cause an Account to be made out of the average Price at which such Stocks, Funds or Annuities respectively, shall have been bought on such day; and in case no Purchase shall have been made of any such Stocks, Funds or Annuities, such Account shall state, that no such Purchase was made of such Stocks, Funds or Annuities, or that the Books of the said Stocks, Funds or Annuities were shut; and the said Account shall be transmitted to the said Commissioners for the Reduction of the National Debt, at their Offices in London or Dublin respectively, for the purposes of this Act, and shall be put up in some conspicuous place in the said Office, in order that the same may be seen by all Persons concerned; and in every case where any such Stocks, Funds or Annuities, shall be so transferred by the said Commissioners for the Reduction of the National Debt, in payment or satisfaction of any such Note or Notes, in manner by this Act directed, such Transfer shall be made according to the average price (to be ascertained as aforesaid) of such Stocks, Funds or Annuities, on the day next preceding that on which such Note or Notes was or were produced at the Office of the said Commissioners, in case there shall have been any Sale or Purchase at the Bank of England or Ireland, or South Sea House respectively, of Stock of the like descriptions on such day, or otherwise on the nearest preceding day on which there shall have been any Sale or Purchase at the said Banks or South Sea House respectively, of Stock of the like descriptions, as that to be so transferred by the said Commissioners, according to the directions of this Act.

That in case of Notes issued on Deposit of Exchequer Bills, the Commissioners may sell such Bills, or pay the Notes, and put the Amount to the debit of the Party, and that the Surplus