“LORD KINNAIRD: I rise to move for a Select
Committee to inquire into the past and present management
of the Mint, and although I very much regret that it is the
intention of the Government not to assent to my Motion, I
feel bound, nevertheless, to call your Lordships’ attention
to the mismanagement of the Department to which my Motion
refers. It will be in your Lordships’ recollection that
when the Coinage Bill was under consideration I moved
for certain returns connected with the gold coinage, my
object being to show that considerable loss occurred in the
process of coining. Some of those returns were granted,
but others were refused on the plea that they were too
voluminous to lay on your Lordships’ table. But I have
made inquiries, and find that refusal was made because
the officials of the Mint did not wish for any searching
inquiry, and because the returns would have exposed certain
malpractices connected with the coinage. I also moved, when
the Bill was in Committee, for certain returns connected
with the coinage of silver and the transactions between
the Bank of England and the Mint. I was informed on that
occasion that no record was kept of those transactions;
I saw at the time that was a subterfuge, and that the
officials knew these returns would disclose certain
malpractices at the Mint which they would prefer were not
made public, for not only is a record of these transactions
kept, but the returns could be granted with ease. I have
found, however, that a return has been presented to the
House of Commons, which gives me the principal part of the
information I desired to obtain by the returns for which
I moved. That return, I have heard said, is not strictly
correct; but it is a return presented to Parliament,
and, as far as the figures to which I wish to refer are
concerned, I have reason to believe they must be correct.
The noble Marquess (the Marquess of Lansdowne) who answered
me on that occasion, admitted that as regards the gold
there was great loss in coinage. He said that although
the Government was not supposed to make money by the gold
coinage, they made a considerable sum by the silver; and
at another time (on the 24th March) he said that although
there was a loss resulting from keeping the silver up to
the proper standard, through wear and tear, yet on the
manufacture there was a profit of something like £20,000
a year. Now, I am not going to hold the noble Marquess to
any statement he made on that occasion, because not being
himself connected with the Mint he must have been dependent
on the officials; but I can assure him that statement is
entirely erroneous. It is quite true that a profit was made
in the Mint in the year 1859 of £27,032 on the coinage of
silver, and this arose from the large quantity coined and
the very small purchase of worn coin. £647,064 worth of
silver was coined in that year as against a yearly average
of £341,018, and the purchase of worn coin amounted to only
£8,096 as against the average of £14,633. But although this
profit of £27,032 was made in this year, there was a loss
of £5,373 during the next nine years. Now, my Lords, as
regards the coinage of silver, there should be an uniform
profit. The price of silver is 5_s._ 1_d._ or
5_s._ 1⅜_d._ per ounce, so that there should be
a profit of 7½ per cent. upon the silver coin. In 1868 the
sum purchased was £312,252, which should have yielded a
profit of £23,368, but the return showed a loss of £10,896;
so that, adding the loss on to what the profit should
have been, we find that the Mint was £34,265 on the wrong
side that year in its silver coinage; but inasmuch as the
loss on the purchase of worn silver was £18,058 in that
year, the net loss to the Mint through mismanagement was
£16,207. Now, what became of that sum of money? How has
it disappeared? The noble Lord admits gold was abstracted
during the process of coining, and I say that the loss now
arises from peculation. The Chancellor of the Exchequer
himself contradicts the noble Lord, and admits that there
is a loss on silver, for in the estimates I find he asked
the House of Commons to vote £1,000 to make good the loss
on silver, in addition to £15,000 for the loss occasioned
by repairing that coinage for the coming year, which has
to be paid out of the pockets of the people instead of the
Exchequer being replenished by the legitimate profit of
£20,000. But the most extraordinary loss is in the coinage
of copper. One ton of copper costs about £100, and when
converted into coin it is worth £358, giving an actual
gross profit of £258; yet I find the Chancellor of the
Exchequer asked for £1,000 last year to make good the loss
on the copper coinage. I have been rather amused to find
the Chancellor of the Exchequer speaking slightingly of the
loss on the gold coinage, saying in all probability it went
up the chimney. I think it is more likely to have gone up
“the spout.” Now, I find another item in the estimates of
£1,800 for the expenses of an inquiry into foreign Mints.
This represents the expenses of three gentlemen who are
going to inquire into the method of coining adopted on the
Continent; but, on inquiry, I find that nearly all the
machinery in use in foreign Mints went from this country,
so that we could ascertain all that we want to know about
the practice in foreign Mints, by making inquiries of
certain engineering firms in this country. I may be told
that the foreign Mints may have improved on the machinery
supplied to them, but even this may be ascertained without
going to this enormous expense. Moreover, most of the
coining on the Continent is done by contract, and it
is not likely that contractors will give a Government
Commissioner, who is competing with them by advertisement,
much information as to the way in which they carry on their
work; so that altogether this £1,800 will be completely
thrown away. And who are the gentlemen commissioned to make
this inquiry? The Deputy Master is one of them—a most
excellent, financial man; but, unfortunately, he knows
nothing of the practical part of the business, and will
gain very little by his trip. Then there is Mr. Roberts,
lately appointed chemist to the Mint; ... and the third
gentleman is Mr. Napier, one qualified in every respect
for the duty. In 1858 a sum of £1,100 was set apart for
the purchase of a filing machine in accordance with an
estimate sent in by Mr. Napier for the purpose; but, before
the order was executed, an officer in the Mint made a
machine answering every purpose, which cost only £60, and
nobody knows what became of this £1,100. I believe this
Commission is going to Spain, but Mr. Napier manufactured
the machinery in use there, so he is going to Spain to see
how his own machines work, and he is to receive £2,000
for doing it. Perhaps, however, as the war has broken out
the trip will be postponed. Now, my Lords, what I say I
am prepared to substantiate before a Committee, and I
challenge contradiction. That an inquiry is needed even at
this late period of the session is patent, for the House
of Commons has only recently voted no less than £18,000
to make up the losses in the Mint. Mr. Fremantle and Mr.
Rivers Wilson have made a Report on the subject of some
of these complaints, and have suggested improvements; but
these improvements would have no effect upon the working of
the establishment, and would not touch the main defects in
the system. One of the alterations made in consequence of
that Report was a revision of the scale of wages. Formerly
the workmen had a retaining fee varying from 6_s._ to
10_s._ per week when unemployed, and a certain wage
beside when at work. But the pay was very small, and it
was thought this might lead to peculation. The scale has
accordingly been revised by the payment of £1 per week as
retaining fee, but the revision is calculated to give the
men a little less on the whole, a result to be expected
when the arrangement was made by so skilful a financier
as the Chancellor of the Exchequer, and the country saves
£100 a year out of the workmen’s wages. But the most
extraordinary part of the revision is to come; and this
affords another instance with the sugar duties, hawkers’
licenses, and the gun tax, of the readiness with which the
Chancellor of the Exchequer jumps to conclusions, without
being at the trouble to inform himself upon the subject in
hand. The workmen are by this new scale to receive less
when coining gold than when coining silver, although the
temptation to peculation is greater, so that at the time
when their honesty should be secured by good payment, they
are to be treated with a niggardly hand, and who can be
surprised if they help themselves? The noble Marquess says
there has been only one case of dismissal for peculation;
but, if he inquires further, he will find there have been
twelve. No prosecution has followed these dismissals, nor
even an inquiry. Prosecutions would not be palatable to the
Mint authorities, because they would expose the system.
Now, I can assure your Lordships, that these statements
I have made are true in every respect, and I challenge
contradiction; and I trust the Government will think the
facts really demand a searching inquiry. More than a
year since, I brought the subject before the Chancellor
of the Exchequer, but it was pooh-poohed, and I was told
that a private inquiry would be made: but no inquiry has
been made, and the system remains unamended. I therefore
move for a Select Committee, to inquire into the past and
present management of the Mint.
The MARQUESS OF LANSDOWNE: I regret that it is my
duty to decline to accede to the motion of the noble Lord,
but I feel sure your Lordships will admit, when I have
made a brief statement of the facts of the case, that the
Government is warranted in refusing the Committee. I must
admit that two cases of peculation have occurred at the
Mint; but the persons concerned were dismissed, and there
has been no reason to suspect a recurrence of the practice;
I am sure therefore, the noble Lord is under a
misapprehension[122] when he says there have been twelve
cases of dismissal for peculation during the last few
years. As regards the charge of wasteful management, I must
repeat the statement I made on a previous occasion. The
noble Lord, I fear, confuses two things—namely, the loss
occurring from the necessity of keeping the silver coinage
up to the proper standard, and the gain which accrues from
the coining; and, on the whole, there is a distinct gain,
although I may, on a previous occasion, have overstated the
amount. There is, notwithstanding the information of which
the noble Lord appears to be possessed, a gain of £5,000
a year on the silver coinage. The amount of waste on the
gold coinage has, within the last few years, been extremely
moderate: it is at present, 1_s._ per £100; and an
eminent firm of refiners in the city has given an opinion
that this is very satisfactory. So much for the past. With
regard to the present, I must say that as the department
has recently been reorganised, it would be hardly fair,
before it had got into full working order, to institute
an inquiry. The staff has been reduced, thus effecting
a saving on this year’s estimates of £5,000; the system
of the payment of wages has been altered, resulting in a
small saving and in a marked effect on the staff; and the
melting and coining departments have been united, avoiding
that apparent confusion between the accounts of the two
departments, which has, in some respects, misled the
noble Lord. Lastly, I come to the Commission of Inquiry,
which has been travelling on the Continent. Now, if the
machines in use on the Continent have been mostly made at
Birmingham, much may be learnt, as to their application and
the character of the metals used, by the proposed inquiry.
As regards the members of that Commission, Mr. Roberts is
a very eminent chemist, and has proved his capabilities
by devising a system for depriving gold of the obnoxious
properties on which the noble Lord recently commented.
The noble Lord did not fail to admit that Mr. Napier was
eminently qualified for a post on the Commission; and, as
regards the Deputy Master, he has exhibited great abilities
in discharging the duties of his office, and I do not
think the noble Lord has said a single word to show he has
forfeited our good opinion.
[Footnote 122: I am prepared to give the names of the parties dismissed
and the dates of dismissal.—G. F. A.]
Since I am desirous of drawing attention to the affairs of a Public
Department, and to that only, I have omitted some passages in the
foregoing debates because they did not affect the subject under
discussion; still, I quote the remainder of the debate in so far as it
was personal to myself in the Appendix at pages 197-198. It will have
been seen that in these debates in the House of Lords, Lord Lansdowne,
on the part of the Government, made statements to which Lord Kinnaird,
in his honoured letter to me, alludes, I therefore proceed to offer a
few remarks.
That Lord Kinnaird does not confound _loss on the coinage_ with loss
occasioned by the repair or “keeping of the coinage up to standard,”
is demonstrated by his lordship’s speeches, and by the return No. 157,
1869, presented to the House of Commons by Mr. Ayrton, which shows
that, in 1859, £647,064 of _coined money_ was obtained by _coining_
£620,031 of silver purchased for coining, giving £27,033 as a clear
profit for that especial year.
If, however, the circumstances be examined, it will be found that in
1859 only £8,096 was lost by the purchase of worn silver coin, as
against the yearly average (shown on page 5 in the return, but not
inserted by me) of £14,633. Yet even this exceptional gain is not
creditable, for, at the rate of 7½ per cent., it should have been
£46,502 instead of £27,033.
The remaining nine years on the return—No. 157, 1869—show an average
loss by the silver coinage as exhibited in the next table compiled from
it. The Mint returns as presented to Parliament require explanation. I
have therefore added two columns to demonstrate the profit and loss.
+-------+-----------------+-----------------+----------+-----------+
| Date. | Total Value of | Real Cost or | Profit | Loss |
| | Silver Coined. | Value of Metal. | Realised.|Sustained. |
+-------+-----------------+-----------------+----------+-----------+
| | £ | £ | £ | £ |
| 1860 | 218,403 | 222,981 | | 4,577 |
| 1861 | 209,484 | 215,029 | | 5,545 |
| 1862 | 148,518 | 159,948 | | 11,429 |
| 1863 | 161,172 | 171,855 | | 10,688 |
| 1864 | 535,194 | 521,003 | 14,190 | |
| 1865 | 501,732 | 483,861 | 17,870 | |
| 1866 | 493,416 | 486,113 | 7,302 | |
| 1867 | 193,842 | 195,445 | | 1,603 |
| 1868 | 301,356 | 312,252 | | 10,896 |
| +-----------------+-----------------+----------+-----------+
| | 2,763,117 | 2,768,487 | 39,362 | 44,733 |
| | | +----------+-----------+
| Deducting the Profit, £39,362, the Final Loss becomes £5,371 |
+-------+----------------------------------------------------------+
Such final loss is indefensible. Yet Lord Lansdowne is led to believe
that the seigniorage on silver yields a profit of £5,000 a year
(modified from his first statement of £20,000), whereas this return,
inclusive of the £27,033 before explained, exhibits a profit of £21,659
in ten years, or of an average of £2,165 per annum. This statement
will, however, deceive those who rely on it, for two reasons. The year
1859, as already pointed out, is exceptional; and another return, No.
67, 1870, made to the House of Commons (see page 150) shows that,
inclusive of this anomalous gain, the silver coinage has been a source
of loss to the country to the exact average amount of 17_s._ 6_d._
on each £100 purchased for coinage. In printing this return I have
made it up to 1868, omitting the year 1869, which alone shows a loss
of £120,000, and must therefore be an incomplete return. It is to be
regretted that the Government refused on two occasions a return of the
account of losses on silver manufacture, because such a return would
have included loss by assay as well as loss by coining and melting.
The refusals were undoubtedly based on fear of exposure, because the
return can be given readily—that they can be given, is proved by the
fact that I have read the accounts in the bill books at the Mint, and
have copies of such entries. Lord Lansdowne was instructed to state
that no such accounts are kept. The subterfuge of the Mint Authorities
consists in the fact that Lord Kinnaird has not asked for the return
in the precise words in which the account is kept; it cannot, however,
be again refused if moved for as “transferred from the account of the
Mint expenses, for the satisfaction of the Audit Office to account for
the waste or loss by coining silver.” If the Mint Authorities will
place the bill book of the Royal Mint before me for a few hours, I
will compile the table. Such a return would exhibit the fact that in
the five years last past, the loss by misplacement and mismanagement
exceeds £1,867 3_s._ 10¾_d._ per million coined; it would show that
the average amount of loss reaches 3_s._ 9¾_d._ for each £100 coined,
such sum being in fact about one-third of the total sum charged by the
contractors who conduct the coinage in Paris for France. The contractor
for the Paris Mint, in his charge, includes loss of silver by coining,
melting, and assay, wear and tear of machinery, wages to workmen for
labour, salaries and contingent expenses; and while bearing these
charges, he makes a handsome
AN ACCOUNT OF THE SUMS ADVANCED IN EACH YEAR FROM THE
CONSOLIDATED FUND FOR THE PURCHASE OF BULLION FOR COINAGE;
AND OF THE SUMS PAID IN EACH YEAR TO THE ACCOUNT OF HER
MAJESTY’S EXCHEQUER AT THE BANK OF ENGLAND, IN REPAYMENT
THEREOF.—(PURSUANT TO ACT 7 WILL. 4, C. 9.)
+-----+------------------+-----------------+-----------------------+
| | Amounts Advanced |Amounts Paid into| |
|Date.| from the |the Exchequer, in| Remarks. |
| | Consolidated | Repayment of | |
| | Fund. | Advances. | |
+-----+------------------+-----------------+-----------------------+
| | £ _s. d._| £ _s. d._| |
|1837 | 22,000 0 0 | | |
|1838 | 196,029 19 4 | 168,029 19 4 | |
|1839 | 400,000 0 0 | 350,000 0 0 | |
|1840 | 170,000 0 0 | 175,000 0 0 | |
|1841 | 100,000 0 0 | 135,000 0 0 | |
|1842 | 180,000 0 0 | 162,120 4 0 | |
|1843 | 350,000 0 0 | 265,000 0 0 | |
|1844 | 550,000 0 0 | 501,389 17 0 | |
|1845 | 850,000 0 0 | 678,772 2 9 | |
|1846 | 300,000 0 0 | 429,937 1 11 | |
|1847 | 100,000 0 0 | 217,033 10 2 | |
|1848 | | 18,534 3 1 | As given |
|1849 | 150,000 0 0 | 120,000 0 0 | in detail in |
|1850 | 150,000 0 0 | 120,000 0 0 | previous |
|1851 | 100,000 0 0 | 187,213 1 1 | Returns. |
|1852 | 391,970 0 8 | 191,970 0 8 | |
|1853 | 508,029 19 4 | 550,000 0 0 | |
|1854 | 100,000 0 0 | 200,000 0 0 | |
|1855 | 250,000 0 0 | 300,000 0 0 | |
|1856 | 450,000 0 0 | 450,000 0 0 | |
|1857 | 420,000 0 0 | 350,000 0 0 | |
|1858 | 400,000 0 0 | 400,000 0 0 | |
|1859 | 550,000 0 0 | 650,000 0 0 | |
|1860 | 270,000 0 0 | 150,000 0 0 | |
|1861 | 400,000 0 0 | 550,000 0 0 | |
|1862 | 400,000 0 0 | 350,000 0 0 | |
|1863 | 250,000 0 0 | 250,000 0 0 | |
|1864 | 600,000 0 0 | 630,000 0 0 | |
|1865 | 520,000 0 0 | 460,000 0 0 | |
|1866 | 410,000 0 0 | 510,000 0 0 | |
|1867 | 300,000 0 0 | 250,000 0 0 | |
|1868 | 220,000 0 0 | 200,000 0 0 | |
+-----+------------------+-----------------+-----------------------+
| 32 |10,058,029 19 4 |9,970,000 0 0 |_Loss_, |
|Years| | |=£88,029 19s. 4d. 17/6=|
| | | |_on the_ =£100= |
+-----+------------------+-----------------+-----------------------+
C. W. FREMANTLE, DEPUTY MASTER OF THE MINT.
ROYAL MINT, _18th February, 1870_.
profit, his total sum for all being 15_s._ for each £100 coined. Is it
probable that the contractor would tolerate a charge of 3_s._ 9¾_d._
for loss alone out of a total of 15_s._ Since the Government refuses
figures, imagination alone can tell what is the loss in the Royal Mint;
yet in the face of such facts Mr. Lowe accepts contracts as against
the French contractor to whom he sends Commissioners—one of whom
experienced “great difficulty in obtaining accurate information with
regard to the amount of loss that accrues” on gold and silver—that he
may instruct them in the cost of manufacture. Does a banker make known
his secrets? He may permit you to stand at his counter and see cheques
paid, but “thus far and no farther” is the guiding principle. Mr.
Lowe’s contract notions have been already noticed.
To return, then, to facts admitted by the Government, and presented
to the House of Lords in obedience to Lord Kinnaird’s motion; the
return numbered 30, 1870, clearly demonstrates that there is, under
the management of the present officers, and has been for the last five
years (see pages 144-145), an average loss by coining of £401, and
by melting, of £916, or a total of £1,317 on each million of silver
coined. By way of contrast, it should be noticed that this return
exhibits the fact that, when the Mint was under my management—between
April 1857 and March 1860—the total average loss, under circumstances
every way similar, was but £395 4_s._, inclusive of “melting and the
losing operations,” for each million of silver coined. Well may the
Government refuse a return which, at the smallest possible computation,
would EXHIBIT AN UNNECESSARY WASTE TO THE EXTENT OF £922 ON EACH
MILLION OF SILVER COINED, OR EXACTLY £3,144 ON THE SILVER CONCERNED IN
THE RETURN No. 157, 1869, quoted at page 149.
The unnecessary waste here displayed is not the only reason why silver
yields no final profit or seigniorage—and the foregoing statements
clearly demonstrate that Lord Kinnaird has not misunderstood the
accounts. The great reason of the loss occasioned by the silver
coinage, both by manufacture and by seigniorage, is want of knowledge
on the part of the Mint officials, for it can require but little
argument to show that that which costs 61_d._ and sells for 66_d._,
must, if properly manufactured, yield an absolute profit. So, to
demonstrate more clearly the exact case, we will take the real cost of
the silver for 1868 and see what profit this should have afforded, and
then Lord Lansdowne will perhaps explain why the loss arises, for this
return (see page 154) is perfectly free from all manufacturing details,
and does not include wages, officers’ salaries, or contingent expenses;
it simply states the bald fact that so much silver was bought and
converted into coined money, and by deducting one from the other there
is demonstrated an actual loss of £10,896 12_s._ Now the amount bought
was in real intrinsic value £312,252 12_s._, and this produced in
coined silver money £301,356. It has been shown in the return now under
comment that silver fetched at that period (1859-1868) 61⅜_d._ per
ounce, which, expressed in decimals, will be 61·375_d._, and silver,
by the Act of Parliament, is so coined as that each ounce is converted
into money of a nominal value of 66_d._, such extrinsic value being
given to silver because it is a token currency, and as such is a legal
tender to the limited extent of £2. The difference, then, between
66_d._ and 61·375_d._ is 4·625; if, therefore, 61·375 gives a profit
of 4·625, it follows that 100 should give 7·535; but for the sake of
simplicity we will consider this profit as at the rate of 7½ per cent.;
then £312,252 12_s._ at 7½ per cent., should yield £23,418 18_s._
10¾_d._, yet not only was the profit lost, but, in addition, there
is a recorded—admitted—loss of £10,896 12_s._, which, added to the
loss of profit, brings that total to £34,315 10_s._ 10¾_d._; but that
Lord Lansdowne may not be unfairly pressed, Lord Kinnaird expressed
willingness to deduct from this sum the amount of loss entailed that
year by recoinage (see * below) and which was £18,058 9_s._ 6_d._,
leaving thereby an irretrievable loss of exactly £16,257 1_s._ 4¾_d._,
on that year alone.
NO. 262.—RETURN TO AN ORDER OF THE HONOURABLE THE HOUSE OF COMMONS,
DATED 30TH MAY, 1870. (MR. AYRTON, PAGE 5.)
_Worn Silver Coin Purchased for Re-coinage._
+----+-----------+-----------------+---------------+---------------+
|Date| Weight. | Nominal Value. |Mint Value at | Loss by |
| | | |5/6 per Ounce. | Re-Coinage. |
+----+-----------+-----------------+---------------+---------------+
| | Ounces. | £ _s. d._| £ _s. d._| £ _s. d._|
|1860| 357902·538| 113,000 0 0 | 98,423 3 9 | 14,576 16 3 |
|1861| 308873·077| 97,600 0 0 | 84,940 1 10 | 12,659 18 2 |
|1862| 425591·682| 135,000 0 0 |117,037 14 3 | 17,962 5 9 |
|1863| 324674·838| 102,800 0 0 | 89,285 11 5 | 13,514 8 7 |
|1864| 388388·152| 123,500 0 0 |106,806 14 10 | 16,693 5 2 |
|1865| 292496·983| 93,000 0 0 | 80,436 13 4 | 12,563 6 8 |
|1866| 361280·187| 115,000 0 0 | 99,352 1 0 | 15,647 19 0 |
|1867| 376142·927| 120,000 0 0 |103,439 6 0 | 16,560 14 0 |
|1868| 388878·297| 125,000 0 0 |106,941 10 6 | 18,058 9 6 |
|1869| 325976·928| 105,000 0 0 | 89,643 13 0 | 15,356 7 0 |
+----+-----------+-----------------+---------------+---------------+
| |3550205·609|1,129,900 0 0 |976,306 9 11 |153,593 10 1 |
+----+-----------+-----------------+---------------+---------------+
_The Yearly Average Price paid per Ounce for Silver Bullion purchased
in the Market for Coinage in the Years 1860 to 1869, both inclusive,
was as follows:—_
+-----+-----+-----+-----+-----+-----+-----+-----+-----+-------+
|1860.|1861.|1862.|1863.|1864.|1865.|1866.|1867.|1868.| 1869. |
+-----+-----+-----+-----+-----+-----+-----+-----+-----+-------+
| _d._| _d._| _d._| _d._| _d._| _d._| _d._| _d._| _d._| _d._ |
| 61¾ | 61½ | 61½ | 61½ | 61¼ | 61 | 61⅞ | 60¾ | 60⅞ | 60⁶/₁₆|
+-----+-----+-----+-----+-----+-----+-----+-----+-----+-------+
_The amount of Seigniorage paid into the Exchequer in the years 1860 to
1869, has been,—_
+--------------+------------+-------------+-----------+------------+
| 1860. | 1861. | 1862. | 1863. | 1864. |
| | | | | |
+--------------+------------+-------------+-----------+------------+
| £ _s. d._ | £ _s. d._| £ _s. d._| £ _s. d._| £ _s. d._|
|27,134 1 8 |4,961 7 5 |11,227 6 2 |211 13 4 |6,160 6 8 |
+--------------+------------+-------------+-----------+------------+
+--------------+-------------+-------------+-------------+
| 1865. | 1866. | 1867. | 1868. |
| | | | |
+--------------+-------------+-------------+-------------+
| £ _s. d._| £ _s. d._| £ _s. d._| £ _s. d._|
|57,645 17 9 |28,630 0 5 |4,331 10 7 |18,622 7 4 |
+--------------+-------------+-------------+-------------+
+--------------+----------------+
| 1869. | Total. |
| | 1860-69. |
+--------------+----------------+
| £ _s. d._ | £ _s. d._|
|12,345 4 10 | 171,269 16 2 |
+--------------+----------------+
C. W. FREMANTLE, DEPUTY MASTER OF THE MINT.
ROYAL MINT, _31st. May, 1870._
Would Lord Lansdowne like to live on a _profit_ of such a description?
Should his lordship still maintain his statement that there is a gain
from seigniorage by coining silver, perhaps he will be so good as
to explain why the Chancellor of the Exchequer asked last year for
£1,000 to “defray the anticipated loss,” as well as £15,000 to pay the
expenses of the recoinage, or “keeping the silver up to the required
standard.” It has been stated that this return is false—it is surely a
grave matter to make a false return to Parliament, in itself a crime
which should be inquired into and punished.
The loss thus exhibited is entailed solely because the Master of the
Mint habitually wishing to keep things quiet, refuses all Parliamentary
enquiry, and contents himself with so-called retrenchment because he
deducts £100 a year from the Mint workmen.
A continuation of the return to which Lord Kinnaird drew attention has
been presented, No. 262, 1869, signed by Mr. Fremantle. Singular to
relate, this is not merely _a continuation_, for it gives information
in regard to seigniorage, and Mr. Fremantle has amended the account
made by Mr. Graham; thus a return presented to Parliament has been
altered by Mr. Fremantle without comment, and now exhibits results
directly opposed to those shown for the same years by Mr. Graham. The
words at the head of the column are, for some reason which does not
appear, also altered, but the “real cost” of metal must mean the same
as the “total amount paid” for it. I have, therefore, compiled from
each a statement of the profit and loss; but I reproduce the figures
presented in the one case by Mr. Thomas Graham, and in the other by Mr.
C. W. Fremantle, BOTH RELATING TO THE SAME ACCOUNT, and both supposed
to be accurate (see page 154).
It is necessary that I should state that Mr. Graham had been dead
more than a year when his accounts were altered, in the manner now
to be explained. If _his_ returns were correct, Mr. Fremantle’s must
be _incorrect_, or, “adjusted,” as Mr. Roberts would style it. If
reference be made to the table on page 154, it will be seen that by
the return No. 157, Mr. Graham showed a loss to the extent of £5,373
4_s._ 6_d._ on nine years’ (1860-1868) silver coinage. Now, Lord
Kinnaird explained that return fully to the House, and, to prove his
accuracy, produced the return No. 30, which will be found on page 150.
Considerable astonishment was caused by such facts, but no reply was
given. However, it now appears by the return No. 262, which I print
under No. 157, and on the same page, that Mr. Fremantle has found the
means to convert Mr. Graham’s _loss_ into an absolute GAIN of so large
an amount as £1,011,668 2_s._ 0_d._, and _that without any word of
explanation_. The returns thus placed together are so contradictory,
that I confess I utterly failed to unravel them, and therefore
submitted them to more than one banker, several merchants, and,
finally, to a professional accountant, not one of whom could suggest a
key to the extraordinary process which has been adopted.
NO. 157.—RETURN TO AN ORDER OF THE HONOURABLE THE
HOUSE OF COMMONS, DATED 21ST APRIL, 1869, FOR ACCOUNT “OF
ALL GOLD, SILVER, AND COPPER MONEYS OF THE REALM COINED AT
THE MINT, FOR EACH YEAR FROM THE 1ST JANUARY, 1859, TO THE
31ST OF DECEMBER, 1868, &C.,” IN CONTINUATION OF NO. 340,
1867-68. (MR. AYRTON, PAGE 3.)
----+-----------------+-----------------+--------------+--------------
Date| Total Value of | Real Cost or | Profit on | Loss on
| Silver Coined. | Value of Metal.| Coinage. | Coinage.
----+-----------------+-----------------+--------------+--------------
| £ _s. d._| £ _s. d._| £ _s. d._| £ _s. d._
1860| 218,403 7 0 | 222,981 1 6 | | 4,577 14 6
1861| 209,484 0 0 | 215,029 0 10 | | 5,545 0 10
1862| 148,518 11 10 | 159,948 2 6 | |11,429 10 8
1863| 161,172 0 0 | 171,855 15 0 | |10,683 15 0
1864| 535,194 0 0 | 521,003 5 0 |14,190 15 0 |
1865| 501,732 0 0 | 483,861 13 6 |17,870 6 6 |
1866| 493,416 0 0 | 486,113 15 2 | 7,302 4 10 |
1867| 193,842 0 0 | 195,445 17 10 | | 1,603 17 10
1868| 301,356 0 0 | 312,252 12 0 | |10,896 12 0
----+-----------------+-----------------+--------------+--------------
|2,763,117 18 10 |2,768,491 3 4 |39,363 6 4 |44,736 10 10
----+-----------------+-----------------+--------------+--------------
Deduct Profit, when there remains Absolute Loss 5,373 4 6
----------------------------------------------------------------------
THO. GRAHAM, MASTER OF THE MINT.
ROYAL MINT, _19th April, 1869_.
NO. 262.—RETURN TO AN ORDER, &C., DATED 30TH MAY, 1870, &c., IN
CONTINUATION OF PAPER NO. 157, OF SESSION 1868-9. (MR. STANSFELD, PAGE
3.)
+-------+-------------------+---------------------+
| Date. | Total Value of | Total Amount Paid |
| | Silver Coined. | for Silver Bullion. |
+-------+-------------------+---------------------+
| | £ _s. d._| £ _s. d._ |
| 1860 | 218,403 7 0 | 141,112 7 11 |
| 1861 | 209,484 0 0 | 100,327 11 0 |
| 1862 | 148,518 11 10 | 51,165 19 11 |
| 1863 | 161,172 0 0 | 53,134 12 7 |
| 1864 | 535,194 0 0 | 445,191 11 9 |
| 1865 | 501,732 0 0 | 416,524 6 9 |
| 1866 | 493,416 0 0 | 282,247 12 6 |
| 1867 | 193,842 0 0 | 181,000 17 11 |
| 1868 | 301,356 0 0 | 80,744 16 6 |
| 1869 | 76,428 0 0 | 135,083 0 11 |
+-------+-------------------+---------------------+
| |2,839,545 18 10 | 1,886,532 17 9 |
+-------+-------------------+----------------------
+-------+--------------------+------------------+
| Date. | Profit on | Loss on Coinage. |
| | Coinage. | |
+-------+--------------------+------------------+
| | £ _s. d._ | £ _s. d._ |
| 1860 | 77,290 19 1 | |
| 1861 | 109,156 9 0 | |
| 1862 | 97,352 11 11 | |
| 1863 | 108,037 7 5 | |
| 1864 | 90,002 8 3 | |
| 1865 | 85,207 13 3 | |
| 1866 | 211,168 7 6 | |
| 1867 | 12,841 2 1 | |
| 1868 | 220,611 3 6 | |
| 1869 | | 58,655 0 11 |
+-------+--------------------+------------------+
| | 1,011,668 2 0 (‡‡)| 58,655 0 11 |
+-------+--------------------+------------------+
C. W. FREMANTLE, DEPUTY MASTER OF THE MINT.
ROYAL MINT, _31st May, 1870_.
The return contains another enigma. For, whereas Mr. Fremantle, on page
3 of the return in which he has amended Mr. Graham’s figures, exhibits
profit to the extent of £1,011,668 2_s._ 0_d._ in place of Mr. Graham’s
loss of £5,373 4_s._ 6_d._—but there being a loss of £58,655 0_s._
11_d._ on his own year’s coinage, the substituted profit(‡‡) must be
reduced by that amount, when it will be £953,013 1_s._ 1_d._ Again,
page 5, he gives a tabular statement (see page 152), by which he shows
that £171,269 16_s._ 2_d._ went to the Exchequer as seigniorage, while
the loss by recoinage amounted to £153,593 10_s._ 1_d._, leaving a
total profit of £17,676 6_s._ 1_d._ What has become of the difference
between this profit and that in the amended return?—a small matter
perhaps, but which yet amounts to £917,659 8_s._ 11_d._ in ten years.
If it were made it can be shown to have been legitimately disposed of,
or is it simply an “official statement,” such as those which public
companies have of late so frequently exhibited. If, however, that sum
has been realised, why does Mr. Fremantle show separately the amount of
seigniorage? There lies below a grave matter for inquiry why a Public
Department should place before Parliament an altered account without
one word of explanation. If Mr. Graham has put forward a false return,
one greatly against himself, it is right that the matter should be
investigated. If, on the other hand, Mr. Fremantle has placed figures
on paper which have no representatives in coin, it is indeed a grave
matter. In either case it goes to prove the necessity for a searching
inquiry into the affairs of the Royal Mint.
Lord Kinnaird does not stand alone in his view of the loss by the
silver coinage, for Mr. William Miller, late Chief Cashier in the
Bank of England, had, years since, arrived at the same conclusion,
and produced at that time evidence to prove his statement. By the
courtesy of Mr. George Forbes, at present Chief Cashier in the Bank of
England, I am in possession of Mr. Miller’s statement (see p. 156):
its perusal induces me to wish that Government officials would put
forward statements as lucid. Mr. William Miller, in this table, adopts
a process which I am assured is entirely legitimate, and by it educes
the fact that “_the Government owes the silver coinage a million and a
half, and not as an account_.” It is perfectly true that the profit,
if made, is not supposed to be placed at interest; but it is also the
fact that the profit _has never been realised_, hence the loss of both
capital and interest. His calculations are those of an accountant,
and by them he argues that if the £6,493,000 of silver coinage had
produced its legitimate gain, there would have accrued by it, and
the interest thereon, a sum of =£3,880,000= clear profit: he then
proceeds to show how that profit has been disposed of. Being himself
aware of the amount of loss by worn coins culled from circulation, he
states it at £255,000; and estimating the loss on that which remains
current, to be eliminated in its turn, at £910,000, shows a loss by
wear and tear of £1,165,000. The details for the complete study of this
table will be found in page 65, where every information is given in
precise figures, while in this he adopts whole numbers, and proceeds
to reason out the entire matter. That he may not press the Government,
he assumes an extreme rate for the expense of coinage—varying from 2¼
to 3½ per cent., while the real cost is about O·75 per cent.—and adds
to that amount the interest thereon, then deducting the total of these
sums from the £3,880,000 which should have arisen, he shows a balance
£1,411,000 which the Government owes to the silver coinage. While Mr.
Miller’s table on page 65 shows an average loss by wear on the silver
coinage current since 1816, at the rate of 24·31 per cent. in a hundred
years, and on that of George III.—_the most worn_—of 98·34 per cent.,
the Mint—receiving its culled coin from the Bank of England—states its
loss at the rate of 135·93 per cent. in the same period (see return, p.
152).