824 REPOET — 1892. 



3,000,000/. in lialf-sovereigns 24,418Z. A sum of 400,000/. was set aside by tlie 

 Act for the expenses of the withdrawal, which will be sufficient at this rate to 

 meet the loss on 26,593,000/. Elaborate investigations were conducted by the late 

 Professor Jevons in 1868, by Messrs. Inglis Palgrave and J. B. Martin in 1882, 

 and by the Mint in 1888, with a view of ascertaining the total amount of light 

 gold in circulation in the United Kingdom. Time does not admit of my analysing 

 the results here, and indeed, so far as actual facts are concerned, the problem can 

 never be solved, as a large number of coins become light each j'ear, and the 

 restoration of the currency, therefore, can never be complete. I might perhaps 

 mention, as an interesting fact, that the Mint examination just referred to showed 

 the gold coins circulating in Scotland to be less worn than those in circulation in 

 England and Wales, owing no doubt to the general use in the north of 11. notes. 



The other question connected with the currency to which I wish to refer is ono 

 which since the last meeting of the Association has been much discussed, and 

 which, though it has not as yet been the subject of legislation, is of primary 

 importance. 



In December last the Chancellor of the Exchequer, in an address at the 

 London Chamber of Commerce, described the changes which he thought it would 

 be desirable to make in the currency sj'stem of this country for the purpose of 

 increasing the central store of gold. The Baring crisis and difficulties which 

 accompanied it, and in particular the necessity for obtaining 3,000,000/. in gold 

 from the Bank of France at very short notice, had drawn the attention of the 

 business communitj- to the fact that the existing metallic reserve was very small 

 in relation to the enormous structure of credit founded upon it, and that it might 

 be found to be wholly insufficient. jMr. Goschen's proposal was to allow the 

 Bank to issue 1/. notes, requiring four-fifths of any additional amount of issue so 

 created to be covered by gold, while only the remaining fifth would be allowed to 

 be issued against securities. The eifect of this scheme, if 1/. notes proved popular, 

 would have been to increase the total amount of the central store of gold, and also 

 to increase the proportion borne by the gold in the Issue Department of the Bank 

 of England to the note-issue covered by it. At the same time the profits upon the 

 fiduciary portion of the additional issue would have sufficed to defray the cost of 

 that issue without additional charge to the public. The Chancellor of the Ex- 

 chequer considered that if a substantial increase were by these means secured in 

 the gold in the Issue Department, it would be safe to allow the Bank, in times of 

 crisis, an elastic power of issuing further notes against securities, upon conditions 

 stringent enough to secure this privilege from abuse. This elastic power of in- 

 creased note-issue was intended to take the place of the illegal suspensions of the 

 Bank Act which bad on several occasions been found necessarj^ in the past. 



This scheme was the subject of much discussion both in the Press and in 

 banking and business communities. There appeared to be a general consensus of 

 opinion that an increase in the central store of gold was ver}' desirable, but there 

 was difference of opinion as to the manner in which that increase might best be 

 brought about. Objection was also felt by many bankers, and by a large part of 

 the general public in the South of England, to the issue of 1/. notes. 



The conditions of the concluding session of the late Parliament were not 

 favourable for dealing with a large scheme of currency reform, and, as it was 

 evident that the scheme proposed would not receive such unanimous support as 

 would make it possible to pass it without very full discussion and consideration, 

 the Chancellor of the Exchequer did not bring his proposals before the House of 

 Commons in the shape of a Bill. 



I make no apology for devoting a large part of this .\ddress to the subject of 

 old-age pensions, although I am inclined to condole with my hearers and myself 

 on the necessity of discussing a question which has now been for many months 

 before the public, and which may by this time be considered to have been worn 

 somewhat threadbare. But the question is surely a great and important one, en 



