LORD MAYO'S FINANCIAL REFORMS
The financial history of Lord Mayo's Viceroyalty divides itself into
two parts. The first narrates the resolute stand which, at the outset
of his administration, he found himself compelled to make against
deficit. The second records the measures by which, after grappling
with the immediate crisis, he endeavoured to reform certain grave
defects in the financial system, and to bring about a permanent
equilibrium between the revenue and the expenditure of India.
When Lord Mayo received charge of the country the financial position
stood thus. The conquests and accretions of a century had left behind
a British Indian Empire nearly equal in size to all Europe less
Russia, with a population of close on 200 millions in our own
Provinces, and 50 millions in the Feudatory States. The cost of
creating that Empire was represented in 1869-70 by a Public Debt of
102 millions sterling; together with another debt of 91 millions
sterling expended on the guaranteed railways and other productive
public works. Of the Public Debt, aggregating 102 millions, about 52
millions may {137} be taken as the charges of establishing the
British Power in India, and 50 millions as the price of reconquering
and reorganising the Empire after the Mutiny of 1857. The 102
millions represented, however, not alone the cost of wars and
conquests. For the English in India had to construct for themselves
the whole fabric of a civilised government. That material fabric
included roads, public offices, barracks, courts, jails, schools,
hospitals; and this vast outlay explains in part the frequent
financial deficits to which I shall presently refer. The other debt
of 91 millions represented the cost of constructing 4265 miles of
opened railway, and of defending great tracts from famine by
canals.[1] The two debts aggregated a capital of 193 millions
sterling laid out in conquering, establishing, and organising the
British India of 1869-70, the first year of Lord Mayo's rule. The
revenue amounted to 509 millions of rupees, then equivalent to over
46 millions sterling: namely 33-1/2 millions of taxation from the
people, or about 3_s_. 4_d_. per head, and 12-1/2 millions from
opium, public works, &c., not of the nature of actual Indian
taxation.[2]
[Footnote 1: To facilitate reference by the reader I take the above
figures as given in the Parliamentary Abstract, Twenty-third Number,
1889, p. 300. But in the subsequent and more detailed statements
(except in direct quotations from State Papers), I convert the rupee
for the sake of accuracy at 1_s_. 10_d_., its value at the time.
Where my figures seem to differ from those in certain of the Blue
Books, the explanation usually is that the Blue Books take the rupee
at its nominal value of 2_s_.]
[Footnote 2: For details of this calculation, see my larger _Life of
Lord Mayo_, vol. ii, p. 6: 2nd Ed., 1876.]
{138} Alike in regard to the amount of the Public Debt of British
India and to the burden of taxation upon the people, the finances of
that country may seem to compare favourably with those of almost any
State in the world. But a nearer examination discloses a different
aspect. Small as were the demands of the Treasury upon the tax-payer,
it had been found impossible to augment them to the level required
for the maintenance of efficient administration. Several of the
highest of our Indian authorities believed that it would be perilous
to do so. The half-century which preceded Lord Mayo's arrival in
India had presented a long series of financial shortcomings. Of the
fifty-five years beginning with 1814-15, and ending with 1868-69,
only sixteen had shown a surplus, while thirty-nine had been years of
deficit. The total of the surplus amounted to about 12-1/2 millions
sterling; the deficits exceeded 75-1/2 millions of pounds. The period
immediately preceding Lord Mayo's arrival was, if possible, even more
discouraging. The last three years from 1866 to 1869, had left behind
deficits aggregating 5-3/4 millions sterling. This was for 'ordinary'
expenditure alone. If we add the outlay on 'extraordinary' (or
reproductive) public works, the total excess of expenditure over
revenue in the three years preceding Lord Mayo's first Budget
amounted to the vast sum of 11 millions sterling.
Nor was the chronic inadequacy of the Revenue the gravest source of
disquietude. The Budget estimates, although framed with the utmost
care which the then {139} existing system allowed of, were constantly
falsified by the results. During the two years from 1867 to 1869 the
Budget estimates had shown a surplus aggregating over 3-1/2 millions,
while the actual results disclosed a deficit aggregating close on
3-1/2 millions. Lord Mayo was thus called to deal not only with a
chronic deficit, but with a financial system which allowed of an
aggregate error in the Budget estimates to the extent of 7 millions
sterling on the wrong side during the two years preceding his rule.
Lord Mayo found therefore three financial tasks imposed on him. He
had first of all to attack the immediate deficit: amounting to 2-1/2
millions in the year immediately preceding his rule. In the second
place he had to reform the whole financial system, which allowed of
the Budget estimates being annually falsified by the actual results.
In the third place he had to devise and to enforce measures of
economy sufficiently stringent to place the finances on a sound
footing for the future. With how resolute a will he carried out this
work, the following pages will disclose. But before entering on that
memorable struggle I may briefly exhibit its results. The subjoined
statement shows more forcibly than any words of mine what those
results meant to India. The three years preceding Lord Mayo's rule
had left a deficit of 5-3/4 millions in 'ordinary' expenditure alone.
In the very first year of his rule he established an equilibrium in
the finances of India, and produced a small surplus. The three years
which followed his reforms {140} left an aggregate surplus of 5-3/4
millions, and that period of surplus was only interrupted by the
Behar famine two years after his death.
_Bird's-eye view of the results of Lord Mayo's Financial
Administration._
+---------------------+----------------------+---------------------+
| Years of Deficit. | Year of Equilibrium. | Years of Surplus. |
| (Before Lord Mayo's | (Lord Mayo's first | (After Lord Mayo's |
| arrival.) | year.) | Reforms.) |
+---------------------+----------------------+---------------------+
| pounds | pounds | pounds |
| 1866-7 2,307,700 | 1869-70 108,779 | 1870-1 1,359,410 |
| 1867-8 923,720 | | 1871-2 2,863,836 |
| 1868-9 2,542,861 | (Surplus in | 1872-3 1,616,888 |
| --------- | Sterling.) | --------- |
| 5,774,281 | | 5,840,134 |
| | | |
| Total deficit of | | Total surplus for |
| three years reduced | | three years reduced |
| to Sterling. | | to Sterling. |
+---------------------+----------------------+---------------------+
The four continuous years of surplus which thus resulted from Lord
Mayo's measures had only one precedent during the period from 1842
onwards, for which the Parliamentary Abstract gives the returns. That
single precedent is found in the years 1849 to 1853, under the rule
of the great Governor-General, Dalhousie. Nor has there been any
subsequent example of four consecutive years of surplus since Lord
Mayo's Viceroyalty down to the present date (1891).
Sir Richard Temple, the Finance Minister, was like Lord Mayo in his
first year of office. Warned by the disappointments of his
predecessors, Sir Richard Temple framed a very cautious Budget for
1869-70, {141} and estimated for a small surplus of 48,263 pounds. It
soon appeared, however, that no amount of caution would avail to
prevent the falsification of the Budget estimates under the system
upon which they were then made up. The first symptoms which caused
Lord Mayo alarm was the discovery that the cash balances in the
treasuries proved lower than had been estimated by his predecessor.
Lord Mayo's anxiety increased as the actual facts of the financial
year previous to his accession, 1868-69, became finally known. Item
after item turned out worse than had been expected, until the deficit
of 889,598 pounds, as estimated in March, 1869, grew to the vast sum
of 2,542,861 pounds, as ascertained from the completed accounts a few
months later.
Nor did the disastrous discrepancy appear only in the Actuals of
1868-69. Circumstances occurred to raise a suspicion in Lord Mayo's
mind that the same fate might be in store for the finances of the
current year, 1869-70. His inquiries led him to order a
re-examination of the whole Budget estimates. These estimates, viewed
in the light of the actual results of 1868-69, disclosed an
inevitable deficit of 1,650,000 pounds for the current year 1869-70,
in place of the surplus of 48,263 pounds, as announced by the Budget
in March. Lord Mayo's perplexities were increased by the circumstance
that Sir Richard Temple, after duly delivering the Budget for
1869-70, had found himself compelled to proceed to England on six
months' leave. Sir Richard's experience and knowledge were not {142}
therefore available at the moment when the Viceroy, in his first
months of office, found a new abyss of deficit suddenly open under
his feet. Fortunately he had the aid of Mr., now Sir John, Strachey,
who was carrying on the duties of Finance Minister during Sir
Richard's absence.
The disclosures which the last paragraph speaks of with smooth
certitude, revealed themselves in 1869 only glimpse by glimpse, and
amid a wide divergence of opinion on the part of the responsible
advisers of the Government. It required the resolute exercise of his
individual will to enable the new Viceroy to tear the truth out of
the conflicting accounts, and to get at the whole facts of the
situation. 'I am beginning to find,' he wrote to a friend, as early
as May, 1869, 'that our finances are not in as comfortable a state as
they ought to be. The enormous distances, the number of treasuries,
and the complicity of accounts as between each, render accurate
forecasts and rapid information almost insurmountably difficult. The
waste of public money is great, and I have been obliged to take
strong measures, and say some very hard things about it.'[3]
[Footnote 3: The Earl of Mayo to Sir Stafford Northcote, 16th May,
1869.]
Each week found the Viceroy poring with a deeper anxiety and a graver
face over the accounts. As he probed into their hollow places, he
found one estimate after another break down beneath his scrutiny. His
letters and papers during that summer disclose, scene by scene, and
with a painful tension of personal {143} responsibility, the slowly
developing drama of deficit; but throughout every line breathes a
firm resolve that, cost him what it might in ease and popularity, he
would establish and maintain equilibrium in the finances of India.
Three months after the letter above quoted, he wrote to Sir Henry
Durand: 'I have just received information which leads me to believe
that in two items of revenue alone, we may look for a decrease of
half a million in the first quarter of 1869-70. Now it is our clear
duty to do all that we can to meet this. _I am determined not to have
another deficit,_ even if it leads to the diminution of the Army, the
reduction of Civil Establishments, and the stoppage of Public Works.
The longer I look at the thing, the more I am convinced that our
financial position is one of great weakness; and that our national
safety absolutely requires that it should be dealt with at once, and
in a very summary manner.' 'I should be sorry,' he wrote to the Duke
of Argyll, 'to say how much I feel the hard lot that is now cast upon
us, to recover the finances from a state of deficit. But unless we
have a war, which God forbid, we will do it.'
Lord Mayo mapped out for himself two distinct methods of dealing with
the situation. In the first place, he resolved that the circumstances
were so grave as to demand immediate measures for meeting the
impending deficit without waiting to the end of the Financial Year.
In the second place, he determined to attack the permanent causes
which {144} had led to deficit, and to prevent their recurrence by a
systematic readjustment of the finances.
The first step taken by Lord Mayo and Sir John Strachey was to reduce
the overgrown grant for Public Works by about 800,000 pounds,--a
measure suggested and carried out with unsparing faithfulness by
Colonel, now Lieut.-General, Richard Strachey, then Secretary to the
Government of India in the Public Works Department. Other
Departments, equally important and equally clamorous, had augmented
their expenditure at a rapid rate. In fact, the ten years which had
elapsed since the dominions of the Company passed to the Crown had
seen the administration rendered more efficient in many ways; and the
cost of the improvements, however admirable they were in themselves,
had in the aggregate become too great for the revenues to bear. In
addition to the reduction of 800,000 pounds for Public Works, Lord
Mayo found himself compelled to curtail temporarily by 350,000 pounds
the grants to the spending Departments which had received so rapid a
development during the decade since India passed to the Crown. The
whole saving amounted to 1,150,000 pounds during the current year
1869-70.
It became apparent, however, that reductions alone would not suffice
to produce equilibrium. Lord Mayo had therefore to decide whether he
would permit the Budget arrangements of the year to stand, with the
knowledge that they would result in deficit, or resort to the
unusual, and in India almost unprecedented, {145} expedient of
additional taxation in the middle of the year. He decided, after
careful inquiry, that the circumstances demanded the latter course.
Had the threatened deficit been preceded by a period of prosperity
and financial accuracy, he would not have deemed so severe a policy
needful. But the public expenditure had, during three consecutive
years, largely exceeded the revenue, and Lord Mayo found that
solvency could only be secured, in the first place, by immediate and
most stringent measures; in the second place, by a permanent
improvement in the finances to the extent of three millions sterling
a year. I mean, of course, the aggregate improvement derived from the
twofold sources of reduced expenditure and increased taxation.
For these and other cogent reasons, Lord Mayo determined to make it
clear by measures of unmistakable vigour that his Government was
resolved to place the finances upon a permanently sound basis. He
raised the income tax from 1 to 2-1/2 per cent. during the second
half of the financial year, and enhanced the salt duty in Madras and
Bombay. The former measure was estimated to add 320,000 pounds and
the latter 180,000 pounds to the revenue of the year; total, 500,000
pounds.
By means of this half-million of increased taxation, and the
1,150,000 pounds of reduced expenditure, Lord Mayo hoped to cover the
estimated deficit of the current year, namely, 1,650,000 pounds. He
thus explained his views to the Secretary of State.
'While the accumulated deficits of the three years {146} ending with
1868-69 have amounted to 5-3/4 millions, the cash balances in our
Indian treasuries have fallen from 13,770,000 pounds at the close of
1865-66 to 10,360,000 pounds at the close of 1868-69, and,
notwithstanding our recent loan of 2,400,000 pounds, are at this
moment lower than they have been at this season for many years.
During the same period our debt has been increased by 6-1/2 millions,
of which not more than 3 millions have been spent on reproductive
works.[4] Your Grace has reminded us that successive Secretaries of
State have enjoined us so to frame our estimates as to show a
probable surplus of from half a million to a million sterling. We
entirely agree with your Grace in acknowledging the soundness of this
policy. We have no doubt that, excluding charges for Extraordinary
Works provided for by loan, our expenditure in time of peace ought to
be so adjusted to our income as to leave an annual surplus of not
less than one million. The necessary conclusion to which we are thus
led is, that nothing short of a permanent improvement in the balance
now subsisting between our annual income and expenditure of at least
three millions sterling will suffice to place our finances in a
really satisfactory condition. How, by reducing our expenditure and
increasing our income, we can best obtain such a result, is the
problem that we have now to solve.
'We are satisfied that there is only one course {147} which we can
properly follow. We must no longer continue to make good the deficit
of each succeeding year by adding to the public debt. And we must
determine, whatever be the difficulty of the task, that there shall
henceforth be no room for doubt that, in time of peace, our income
will always be in excess of our ordinary expenditure.'
[Footnote 4: Par. 71 of Despatch to Secretary of State No. 240, dated
20th Sept. 1869.]
I have mentioned the immediate measures by which Lord Mayo
endeavoured to stay the impending deficit. But he felt that such
measures strained the whole mechanism of the Government; that to stop
public works on a sudden involved waste of material, while the
increase of taxation during the current year disclosed in a most
undesirable manner the shortcomings of our system, and might prove a
cause of perilous discontent among the Indian people. 'We have played
our last card,' he once said in conversation, 'and we have nothing
left in our hands to fall back upon, except to devise measures which
will prevent the recurrence of a similar crisis hereafter.' He
accordingly resolved to find a permanent remedy, by removing the
causes of the financial misfortunes in past years.
His reforms divide themselves into three branches. First,
improvements in the mechanism of the Financial Department of the
Supreme Government itself. Lord Mayo thought that it would be vain to
ask the Local Governments to set their houses in order, if they could
point to confusion or want of prevision in his own. Second, the more
rigid enforcement on the Local Governments of economy in framing
their {148} estimates, and of accuracy in keeping within them. While
thus increasing their fiscal responsibility, Lord Mayo also extended
their financial powers. Third, a systematic and permanent
readjustment of the revenues and the expenditure.
First, as regards defects in the mechanism of the Financial
Department, Lord Mayo found that the disastrous series of fiscal
surprises were due in part to unpunctuality in the submission of the
yearly estimates by the Local Governments and Departments, so that
the Supreme Government had not sufficient time to examine and collate
the accounts before the season for delivering the financial statement
arrived. He discovered, also, grave deficiencies in the Financial
Department itself as regards intelligent observation of the progress
of the finances during the year. While, therefore, the Local
Governments throughout India were complaining of the number and
complexity of the statistical returns required from them, the last
act in the process which would have rendered these returns fruitful
of results, namely, their careful collation by the Finance
Department, was inefficiently performed.
Without such final collation, the gathering of statistics is indeed a
thankless task. I merely repeat the statement of the Member of the
Government best qualified to speak on the subject, when I say that,
up to Lord Mayo's time, no sufficient provision existed for the
intelligent use of the statistical materials which daily poured in.
It did not seem to be understood that the toil expended by scattered
{149} Departments upon the compilation of returns can bear no fruit
unless they are intelligently studied by the central bureau for which
they are compiled. Statistics as they existed in India before Lord
Mayo's rule were sorrowful memorials of faithful subordinate labour,
rendered unavailing by the indifference or neglect of higher
officials.
The financial collapse in 1869, forming as it did one of a series of
similar catastrophes, gave a new impulse to better work. The
preparation of classified statistics was undertaken on a systematic
basis and with an extended scope. Having thus put his own house in
order, Lord Mayo took measures to ensure punctuality in the
submission of the Estimates by Local Governments and Departments. He
also organised, or to speak more correctly, remodelled a system by
which the Supreme Government now obtains full information bearing
upon the progress of the finances month by month. Mr. Chapman, the
Secretary to the Department and the officer most competent to speak,
thus wrote of the results:--'It is not too much to say that it has
become impossible for the Government to remain long ignorant of any
important fact affecting the finances. Expectation may be
disappointed, misfortune or mistakes may occur; but the Government
will at least be promptly informed of the event, and it is difficult
to exaggerate the importance of promptitude in this respect.'
The second great branch of Lord Mayo's financial reforms consisted in
his more rigid enforcement of {150} economy upon the Local
Governments. A fertile source of financial difficulty has always
existed in the division of the British administration of India into a
number of governments, separated from, although subordinate to, the
Governor-General in Council. Before Lord Mayo's Viceroyalty the
separate governments, while so far independent entities as to be
responsible for the civil administration and improvement of their
several Provinces at the cost of the imperial revenues, had, in
regard to their revenues, no independent financial powers. Towards
the end of every year, each Local Government presented to the
Governor-General in Council its estimates of expenditure during the
coming twelve months. The Governor-General in Council, after
comparing these aggregate estimates with the expected revenue from
all India, granted to each Local Government such sums as could be
spared for its local services.
The system acted in a manner most unfavourable to economy. The Local
Governments were under no compulsion to adjust their expenditure to
any limited scale of income, and several of them fell into the habit
of framing their demands upon the Imperial Treasury, with an eye
rather to what they would like to spend than what was absolutely
required. 'Practically,' writes one who had the official control of
the system, 'the more a Government asked, the more it got; the
relative requirements of the Local Governments being measured by
their relative demands. Accordingly they asked freely and {151}
increasingly. Again, knowing that any money saved at the end of the
year was lost to the provincial administration, a Local Government
was little anxious to save.' These words, while representing the
facts, do not necessarily involve a reproach. In India more money can
be spent with advantage on almost every branch of the administration
than the revenues will permit.
Lord Mayo clearly discerned that, in order to secure the co-operation
of the Local Governments in the work of financial reform, he must
invest those Governments with a share of the financial
responsibility. After an exhaustive preliminary correspondence with
each separate Administration, he issued a Resolution on the 14th
December, 1870, which may be called the Charter of the Provincial
Governments. By this document, which in due time received the
approval of the Secretary of State, a fixed yearly consolidated grant
was made to each Government, to enable it to defray the cost of its
principal services, exclusive of the Army, but including Public
Works. The grants thus made were final, for a period usually of five
years, and were liable to reduction only in case of severe financial
distress happening to the Supreme Government. They belong absolutely
to the respective Local Governments. No savings from any one of them
revert to the Imperial Treasury. Their distribution is left to the
discretion of the Local Governments, without interference on the part
of the Governor-General in Council.
The services thus made over to them included the {152} protection of
person and property, the education of the people, the record of
changes or transfers connected with landed property, sanitation,
Local Public Works, and a number of minor branches of government. For
official purposes they were grouped as follows: Jails, Registration,
Police, Education, Medical Services (except 'Medical Establishments'),
Printing (an enormous item in India), Roads, Civil Buildings, and
various Public Works, Miscellaneous Public Improvements, and various
minor services.
This well-jointed system of Provincial and Imperial Finance continues
to be the basis of Indian Finance to this day. It has received
further developments since Lord Mayo's time, but its principles
remain unchanged. Sir John Strachey thus summarised the state of
things which preceded it:--
'For many years before Lord Mayo became Viceroy, the ordinary
financial condition of India had been one of chronic deficit, and one
of the main causes of this state of affairs was the impossibility of
resisting the constantly increasing demands of the Local Governments
for the means of providing many kinds of improvement in the
administration of their respective Provinces. Their demands were
practically unlimited, because there was almost no limit to their
legitimate wants. The Local Governments had no means of knowing the
measure by which their annual demands upon the Government of India
ought to be regulated. They had a purse to draw upon of unlimited,
because of unknown, depth. They saw on every side the {153} necessity
for improvements, and their constant and justifiable desire was to
obtain for their own Provinces and people as large a share as they
could persuade the Government of India to give them out of the
general revenues of the Empire. They found by experience, that the
less economy they practised, and the more importunate their demands,
the more likely they were to persuade the Government of India of the
urgency of their requirements. In representing those requirements
they felt that they did what was right; and they left to the
Government of India, which had taken the task upon itself, the
responsibility of refusing to provide the necessary means.
'The Government of India had totally failed to check the constant
demands for increased expenditure. There was but one remedy: namely,
to prevent the demands being made; and this could only be done by
imposing on the Local Governments a real and an effectual
responsibility for maintaining equilibrium in their local finances.
There could be no standard of economy until apparent requirements
were made absolutely dependent upon known available means. It was
impossible for either the Supreme or Local Governments to say what
portion of the provincial revenues was properly applicable to local
wants. The revenues of the whole of India went into a common fund,
and to determine how much of this fund ought fairly to be given to
one Province and how much to another, was impracticable.'
'The distribution of the public income,' {154} Major-General R.
Strachey wrote, 'degenerates into something like a scramble, in which
the most violent has the advantage. As local economy leads to no
local advantage, the stimulus to avoid waste is reduced to a minimum.
So as no local growth of the income leads to an increase of the local
means of improvement, the interest in developing the public revenues
is also brought down to the lowest level.' It is right to add that
the reforms by which Lord Mayo put an end to this unprofitable state
of things were in a large measure due to the initiative of General
Richard Strachey, supported by the administrative authority and
experience of his brother, Sir John Strachey. But the question of
Local Finance first presented itself to Lord Mayo during his
inquiries in the India Office, and he discussed it at Madras on his
way out to Calcutta.
Lord Mayo's third and heaviest task was the permanent readjustment of
the revenues to the expenditure. He accomplished this task partly by
new taxation, but chiefly by economy and retrenchment. On his arrival
in January, 1869, Lord Mayo found two Despatches awaiting his
consideration. One was a Despatch from his predecessor, Lord
Lawrence, urging on the Secretary of State the imposition of an
income tax; or, more strictly, the expansion of the certificate tax
into an income tax for the year 1869-70 then about to begin. The
other was a Despatch from the Secretary of State sanctioning the
proposal. Lord Mayo's first measure with a view to raising the
revenues of India was, therefore, to carry {155} out this decision
which had been arrived at before he reached India, and to levy an
income tax. By efforts to equalise the salt duty in certain
provinces, and at the same time to develop new sources of salt
supply, and to cheapen the cost of carriage, he laid the foundation
of a further increase of revenue, with the least possible addition to
the burdens of the people.
It was, however, to economy rather than to increased taxation that
Lord Mayo looked for a surplus. Indeed, he strongly felt the
necessity of abandoning some of the old objectionable forms of Indian
taxation, such as the export duties; and he made a beginning by
abolishing the export duty on wheat. On the other hand, every
Department of Expenditure was keenly scrutinised, and severely cut
down to the lowest point compatible with efficiency. As a matter of
fact, and notwithstanding the new income-tax, the total revenue which
he levied from India during his three years of office averaged nearly
a million less than the revenue levied during the year 1868-69
preceding his Viceroyalty; while the expenditure averaged about five
millions per annum less than that of the year preceding his
Viceroyalty. The following table exhibits the results of the system
of vigilant economy by which Lord Mayo converted a series of years of
deficit into a series of years of surplus. For purposes of reference
to the Parliamentary accounts it reproduces the conversion at the
then official rate. It does not, accordingly, show the exact balance
in sterling, as worked out for the table earlier in this chapter.
{156}
_Indian Revenue and Expenditure under Lord Mayo (at the then official
rate of ten rupees to the pound)_.
+---------+------------+----------------------+--------------+
| | | | Ordinary |
| Year. | Revenue. | | Expenditure. |
+---------+------------+----------------------+--------------+
| | pounds | Year of Deficit | pounds |
| 1868-69 | 51,657,658 | preceding Lord | 54,431,688 |
| | | Mayo's Rule. | |
| | | | |
| | | Year of equilibrium; | |
| 1869-70 | 50,901,081 | his first year of | 50,782,413 |
| | | office. | |
| | | | |
| 1870-71 | 51,413,685 | Years of Surplus; | 49,930,695 |
| | | his last two years | |
| 1871-72 | 50,109,093 | of office. | 46,984,915 |
+---------+------------+----------------------+--------------+
Lord Mayo did not live to see the permanent fruit of his labours. But
I cannot conclude this brief sketch of them more fitly than by a
letter which the Financial Secretary to the Government of India wrote
to me three years after Lord Mayo's death, when his work had been
tested by the touchstone of time.
'Lord Mayo's close personal attention to financial questions never
flagged. He had by decisive measures established steady surplus for
chronic deficit; he had increased the working power of the Local
Governments, while checking the growth of their demands upon the
Imperial Treasury. He had established a policy of systematic
watchfulness and severe economy. The time was now coming when the
results of all his exertions and sacrifices were to be gathered; when
the Viceroy would be able to gratify his nature {157} by granting
relief from the burdens which he had reluctantly imposed. Lord Mayo
was occupied with such questions on the very journey which ended so
fatally. He had reason to hope that effective remission of taxation
would soon be practicable, but he was still uncertain what shape it
ought to take. It should never be forgotten that the welcome measures
of relief which the Government subsequently found itself in a
position to effect, were possible only in consequence of Lord Mayo's
vigorous policy of retrenchment and economy.
'He found serious deficit, and left substantial surplus. He found
estimates habitually untrustworthy; he left them thoroughly worthy of
confidence. He found accounts in arrear, and statistics incomplete;
he left them punctual and full. He found the relation between the
Local Governments and the Supreme Government in an unsatisfactory
condition, and the powers of the Local Governments for good hampered
by obsolete financial bonds. He left the Local Governments working
with cordiality, harmony, and freedom, under the direction of the
Governor-General in Council. He found the Financial Department
conducted with a general laxity; he left it in vigorous efficiency.
And if the sound principles be adhered to, which Lord Mayo held of
such importance, and which in his hands proved so thoroughly
effective, India ought not again to sink into the state from which he
delivered her.'
{158}