INTRODUCTION

There are many persons who have heard from one source or another of the way in which the States of Guernsey built their Market House by means of non-interest-bearing notes. Some of these—enthusiasts for the reform of the currency—can dilate for hours on the wisdom of the financial policy of Daniel de Lisle Brock, can tell how, at the opening of the Market he "sprinkled the packages (of redeemed notes) with perfume, and while the band was playing a dirge he laid them on the fire, where they were quickly consumed," and can even quote from his famous speech on that occasion.

A few years ago some members of the Co-operative Brotherhood Trust, which is a Society that has among its objects a desire to revive the principles of Robert Owen's Labour Exchange, thought it worth while to make enquiries as to the Guernsey scheme. They realised that an ounce of fact was worth a ton of theory. But what were the facts? Were these notes circulated in the island as a medium of exchange? How were they redeemed? Could a citizen demand gold for them? When the above mentioned enthusiasts were tackled with these practical questions, there was suddenly noticed a certain hesitancy; and when asked point blank what was the year in which this famous Market House was built, no one could say.

Enquiries were then made from inhabitants of the island itself. The information gathered was vague and not much to the point. With a few notable exceptions, the average Guernseyman seems to know or care little of the financial policy of the island at the beginning of the nineteenth century. Even from those interested nothing very definite was to be learned. The enquirers at last came near to doubting whether the non-interest-bearing notes had ever existed except in the imagination of the enthusiasts. Only first-hand enquiry on the spot would suffice.

One Guernseyman, a teacher, kindly encouraged the writer to visit the island himself, promising him introductions and access to all the official documents and newspapers of the time. Through the courtesy of the Greffier and the Librarian of the Guille-Allés Library every facility was granted to the writer and his wife to carry out their research. The politeness and kindness of these officials and other inhabitants of Guernsey are hereby most cordially acknowledged.

In the following pages it is the writer's desire to place the facts before the public as he has gleaned them from the official records of the States and the newspapers of the time. He feels tempted to discuss the pros and cons of the system adopted by the States of Guernsey for over twenty years; but this little treatise will probably be of most use if it is confined to a mere narration of facts. Incidentally, however, it will be seen that some of the queries which led to the research have been answered. From the nature of the case this narration will consist largely of quotations. It must inevitably fail to convey to the reader the thrilling interest aroused as the story, exceeding all the romance of the enthusiasts, led its slow but fascinating course through many volumes, and the quaint old French documents gave up their secrets in the modern well-equipped Record Office.

CHAPTER I

CONSTITUTION OF GUERNSEY.

Guernsey is the second in size of the four Channel Isles, Jersey, Guernsey, Alderney and Sark, which one used to repeat with such gusto in one's schoolboy days. The Channel Isles are the last remnant of our French possessions. Or rather, as the Islanders might claim—and as it is reported some do—England belongs by right of conquest to the Channel Isles. However that may be, for all practical purposes, the government of Guernsey is autonomous—and very jealously does the Guernseyman guard this autonomy.

It has its own Parliament, "The States" (Les États), consisting to-day of 49 Members. At the time of which we write there were 32 Members, as follows:—

The Bailiff, who, as at the present time, acted as President.

The Procureur du Roi, corresponding to our Attorney-General.

12 Jurats or Magistrates, appointed for life by the "States of Election."

8 Rectors.

10 Connétables or Parishioners.

The Rectors as spiritual leaders and the Connétables as civil functionaries represented the ten parishes of the island, and though the latter were elected to office they were always from the leading families, which formed an extremely close oligarchy. Bailiff, Jurats and Rectors still sit in this undifferentiated Parliament, to which has been added a slightly more democratic element however, nine Deputies being elected by the Ratepayers of the whole Island.

It was, and still is, the Bailiff's duty to summon this "States of Deliberation," formerly at his own discretion, now at regular intervals. He does this by means of issuing a Billet d'Etat, in which he comments on the business to come before the States and in which he formulates certain resolutions. On these resolutions the States only vote for or against. This Billet d'Etat is in French, still the official language—the only one used in the deliberations in former days.

The whole takes us back in thought to Norman or early English times. Probably even the Norman patois of the modern rural deputies is the speech of the present time nearest to that in which our ancestors transacted their business.

This legislative body represents the King's Council, in the same way that the supreme judicial body, still bearing the name of La Cour Royale, represents the King's Court.

The decisions of the States are subject to the approval of the Privy Council, to whom there is a right of appeal.

CHAPTER II

THE SECURITY OF THE NOTES

Guernsey, like other places, fell on evil days early in the nineteenth century, the period of history with which we have to deal; and the islanders suffered from the burden of a heavy debt and from the depression and want of employment which followed the close of the Napoleonic wars.

Its condition at this time is graphically described in the following extracts taken from a document presented by the States to the Privy Council in 1829.

"In this Island, eminently favoured by nature, antecedently to the new roads first projected by Sir John Doyle, Bart., nothing had been done by art or science towards the least improvement; nothing for the display or enjoyment of local beauties and advantages; not a road, not even an approach to Town, where a horse and cart could pass abreast; the deep roads only four feet six inches wide, with a footway of two to three feet, from which nothing but the steep banks on each side could be seen, appeared solely calculated for drains to the waters, which running over them rendered them every year deeper and narrower. Not a vehicle, hardly a horse kept for hire; no four-wheeled carriage existed of any kind, and the traveller landing in a town of lofty houses, confined and miserably paved streets, from which he could only penetrate into the country by worse roads, left the island in haste and under the most unfavourable impressions.

"In 1813 the sea, which had in former times swallowed up large tracts, threatened, from the defective state of its banks, to overflow a great extent of land. The sum required to avert the danger was estimated at more than £10,000, which the adjoining parishes subject to this charge were not in a condition to raise. The state of the finance was not more consolatory with a debt of £19,137, and an annual charge for interest and ordinary expenses of £2,390, the revenue of £3,000 left only £600 for unforeseen expenses and improvements.

"Thus at the peace, this Island found itself with little or no trade; little or no disposable revenue, no attraction for visitors, no inducement for the affluent to continue their abode, and no prospect of employment for the poor."

After considering various means of raising a revenue, the States asked the Privy Council for permission to levy a duty on spirituous liquors. Notwithstanding some opposition by the inhabitants, permission was granted by an Order in Council of the 23rd July, 1814, to raise 1s. per gallon on spirituous liquors consumed in the Island. This was granted for a period of five years.

A second Order in Council, dated 19th June, 1819, renewed the duty for ten years. Again there was opposition from a section of the inhabitants. This made itself felt by the insertion in the Order of the following words:—"That One Thousand Pounds per annum of the produce of the said duty be applied solely to the liquidation of the present debt, together with such surplus as shall remain out of the produce of the tax in any year after defraying the expenses of roads and embankments and unforeseen contingencies. And that the States of the said Island do not exceed in any case the amount of their annual income without the consent previously obtained of His Royal Highness in Council. And the said States are hereby directed to return annually to the Privy Council an account of the produce and application of the said Tax."

In 1825 the Lieutenant-Governor, Sir John Colborne, desired to erect a new College and to carry on other important works. But these plans could not be accomplished without the assurance of the renewal of the duty. A third Order in Council of 30th September, 1825, gave this permission for a period of fifteen years, that is to say, from 1829 to 1844. On this occasion there was no opposition from any of the inhabitants.

As will be seen in the next chapter, it was this duty on spirituous liquors that formed the security on which the notes were issued.

CHAPTER III

MUNICIPAL ENTERPRISE—THE ISSUE OF NOTES

"Guernsey should make up only one great family whose interests are common. Only by union and concord can she enjoy firm and lasting prosperity."

Although, as we shall see, the first notes that were issued were not for the Market, it is interesting to find that there is some foundation for the tradition identifying them with it. The plan was first suggested in connection with a scheme for the enlarging of the Market.

This was a much needed improvement. "Humanity cries out, every Saturday," reports a States Committee, "against the crush, which it is difficult to get out of; and every day of the week against the lack of shelter for the people who, often arriving wet or heated, remain exposed for whole hours to wind and rain, to the severity of cold and to the heat of the sun."

A Committee, appointed 12th April, 1815, to consider the question, having brought in a scheme for enlarging the Market, recommended the issue of State Notes. The Bailiff submitted the following resolution for the consideration of the States at their meeting on 29th March, 1816:—"Whether in order to meet the expenditure it would not be desirable to issue State Notes of One Pound each (Billets des États d'une Livre Sterling) up to £6,000, the States undertaking not to issue any, under any pretext whatever, beyond the said sum before having previously cancelled the said £6,000."

Notwithstanding the Committee's opinion that the enlargement of the Market could not be recommended without this issue, and the precautions suggested for the issue of the Notes, the States rejected the proposition.

However, the promoters of the idea appear to have been nothing daunted, and to have met with success on their second attempt. For we find that on the 17th October of the same year the Finance Committee reported that £5,000 was wanted for roads, and a monument to the late Governor, while only £1,000 was in hand. They recommended that the remaining £4,000 should be raised by State Notes of £1, 1,500 of which should be payable on 15th April, 1817, or any Saturday after by the Receiver of the Duty, 1,250 on 15th October, 1817, and 1,250 on 15th April, 1818.

"In this manner, without increasing the debt of the States, we can easily succeed in finishing the works undertaken, leaving moreover in the coffers sufficient money for the other needs of the States."

The States agreed to this and appointed a Committee of three (Nicolas Maingy, Senior, Jean Lukis and Daniel de Lisle), who were exclusively charged with the duty of issuing the Notes, taking all the precautions they thought necessary. They were to pay them out on the order of M. le Superviseur (Jean Guille), and to receive them back from the Receiver of the Duty when paid in, in order to cancel them.

These Notes seem to have served their purpose; for in the record of the decisions of the States on the 18th June, 1818, is found the following entry:—"The said States unanimously authorise the issue of new Notes up to £1,250, to be put at the disposal of Jean Guille, Esq., Jurat, for the needs of the State; and they ask the said gentlemen, Daniel de Lisle, Nicolas Maingy and Jean Lukis, kindly to help in the matter. Which Notes shall be payable at a fixed time to be determined by the States' Committee named for this purpose at the time of the last issue of Notes."

The need for enlarging and covering the Market was meanwhile being more and more pressed, the site and certain buildings having been purchased on 10th April, 1817, for £5,000, which was borrowed at 4½ per cent.[1] A Committee reported on this subject to the meeting of the States on 6th October, 1819. In their recommendation they proposed "the issue of Notes of £1 sterling, payable at different times on the receipt of the part of the Duty left at the disposal of the States." Notwithstanding the pathetic appeal already recorded, the proposal of the Committee to enlarge and to cover the Market was lost by a majority of one.

The advocates for improving the Market, however, persevered, and presented to the States Meeting of 12th May, 1820, five plans. The plan of John Savery Brock at a cost of £5,500 was agreed to by a majority of 19 to 10.

The following quotation from the Committee's report shows the benefits which they considered would arise from their scheme for raising the £5,500 required.

"The means of meeting this would be to apply to it
the sums now in litigation with the town		£1,000
Twenty-shilling Notes put at the disposal of the Committee 4,500
£5,500

But provision must be made for the repayment of the Notes issued, and the means recommended by your Committee are as follows—

"The 36 shops, built for butchers according to the plan recommended, would produce at £5 sterling per annum£180
From this must be deducted £20 for hiring the house at the corner and £10 for repairs 30
£150
The States should grant for 10 years after the first year300
This would give an income of£450

This sum would be spent each year in paying off and cancelling as many Notes.

"Thus, at the end of ten years, all the Notes would be cancelled and the States would be in possession of an income of £150 per annum, which would be a return for the £3,000 spent by them.

"Looked at from all sides the scheme shows nothing but the greatest advantage for the public and for the States. It should please those who have at heart the diminution of the debt, since the States in addition to the £1,000 set aside for this purpose, take a further £300 out of their treasury in order to increase their income (en prenant 300l. de plus sur leurs épargnes pour accroître leur revenu)."

Thus it appears that the money for building the Meat Market, still standing, was raised without a loan, the States paying off the Notes at the rate of £450 a year as the duty on spirits and the rents came in. The Market is described in Jacob's Annals of the British Norman Isles, Part I., published in 1830, as a handsome new building, "one of the most convenient, both for the buyers and sellers, that can be found in any part of the world." "For the mode of raising the funds for its erection and support (well worth the attention of all corporate bodies)" we are referred to an Appendix IV. which was to appear at the end of Part II., to be published in December, 1831.[2]

Diligent search in contemporary records showed no trace of the elaborate ceremony described in the tradition current among enthusiasts, though the Mercury of the 5th October, 1822, announced in its advertisement column that the opening would take place on Saturday, 12th October, 1822.

The following week the Mercury chronicles the handing over by the Committee of the keys of the new Market to the butchers. "A large crowd gathered in the square, of whom only a few succeeded in entering the enclosure. A speech was made by one of the Committee, to which one of the butchers made a reply. The band of the East Regiment took part and the church bells rang till five in the evening."

The next issue of Notes seems to have been to pay off the floating debt. On 14th June, 1820, the States authorised the issue of 4,000 £1 Notes for this purpose. In recommending this course the Finance Committee makes some interesting reflections. "Respecting the floating debt, which consists of sums payable at times more or less distant, it would be easy to discharge it by £1 Notes put into circulation as need requires. The extinction of the whole of the floating debt could thus be brought about without the necessity of new loans. If loans should be raised it would be necessary to provide for payment both of the principal and of the interest. If, on the contrary, recourse is had to £1 Notes, the interest alone which would have been paid will suffice."

On 23rd June, 1821, the States authorise the issue of 580 £1 Notes to buy a house whose site is wanted for the new Market.

On 15th September of the same year the issue is authorised of 4,500 £1 Notes to diminish the interest-bearing debt of the States. In recommending this, the Finance Committee remarks:—"The States could increase the number [of Notes in circulation] without danger up to 10,000 in payment of the debt, and the Committee recommends this course as most advantageous to the States' finance, as well as to the public, who, far from making the slightest difficulty in taking them, look for them with eagerness."

On 30th June, 1824, on the united recommendation of the Market and Finance Committees, 5,000 £1 Notes are issued to pay off the £5,000 originally paid for the Market in 1817 (see p. 11). "By this means the interest of £200 (sic) a year will be saved and applied moreover every year to withdraw from circulation £1 Notes issued for the construction of the Market."

On 29th March, 1826, a further issue is authorised for the purpose of Elizabeth College and Parochial Schools, provided that the total number of Notes in circulation shall not exceed £20,000. In summoning the States on this occasion, the Bailiff, Daniel de Lisle Brock,[3] expresses the opinion that paper money is of great use to the States. There is no inconvenience because the Notes are issued with great care.

This statement as to great care is borne out by the words of the resolution passed 12th May, 1826, authorising the issue of £5 Notes, not exceeding £8,000 worth, voted for the Isle of Sark and other purposes. After asking Nicolas Maingy, Jean Lukis and Daniel de Lisle "to sign the said Notes in the name and under the guarantee of the States," it goes on to say, "and in default of one or other of these gentlemen through absence or illness, the States authorise the remainder of the three, the Finance Committee and M. le Superviseur to choose conjointly another reputable person for the signature of the said Notes. Which said Finance Committee Supervisor and those authorised to sign are charged and requested to watch over and be present at (veiller et assister à) the destruction of the said Notes at the times fixed for their repayment."

Extra precautions seem to have been taken 28th June, 1826, when another issue, not exceeding £2,000 worth of £5 Notes was authorised. For we find that "The States appoint Josias le Marchant, Pierre le Cocq, Jurats, and the Rev. Thomas Grut, a Special Committee, whose duty it is to see to the liquidation of all the anticipations at the times fixed by the States, and where these anticipations consist in Notes of one or five pounds to see to the destruction of the very Notes or of earlier Notes to the same amount. Which Committee is commanded to make a report to the States at least once each year certifying the liquidation and destruction of the said anticipations and of the said Notes."

Further care is shown by the fact that on 26th March, 1828, the States appointed the Finance Committee "to replace the used and worn-out Notes by new Notes, payable at the same time as the destroyed notes would have been." Testimony is borne by this wear and tear to the extent to which the Notes circulated.

Plans for the improvements in Rue de la Fontaine, a street adjoining the Markets, being adopted on 15th November, 1827, an issue of £1 Notes up to £11,000 was authorised to be cancelled by the proceeds of rents.

In 1828 and 1829 issues of Notes were authorised for various purposes, including £8,500 for the College and £11,000 in connection with the Rue de la Fontaine scheme.

At one of the sittings of the States in the year 1829, William Collings, a member of the Finance Committee, stated that there were 48,183 Notes in circulation.

On 18th March, 1834, £1,000 was voted for cholera precautions, to be raised either at 3 per cent. interest or in £1 Notes. The latter course seems to have been adopted.

From the foregoing it will be noticed that during the 20 years over £80,000 worth of Notes were authorised by the States to be issued. These were mostly of the value of £1, though some £5 Notes were authorised.

In 1837 there were still in circulation 55,000, which in that year were reduced, as will be seen in a subsequent chapter, by 15,000.

It may be asked whether there is any evidence that the Notes were destroyed as directed. From various sources we found records of at least 18,000 being destroyed. For instance, in the Gazette of 3rd March, 1827, there is the following:—

"Market Accounts for 1826.
Notes to Bearer of £1 destroyed.
22 March, 1826£400
7 November, 1826£420
1 March, 1827£122
£942
Total of Notes issued for the Market, £11,296
Total of Notes destroyed for the Market, 3,626
Leaving in circulation £7,670."