Note (8)—Civil List million. See [page 121].—The income settled upon King George I. for his civil list, was 700,000l.—In 1720, there had been granted him besides, from the Royal Exchange and London Assurance companies, 300,000l. And in 1726, this million was farther granted towards paying off his debts.

Note (9)—Bank Long Annuity. See [page 122].—This annuity consists of 128,250l. per ann. for 99 years, given in 1761, as a premium to the subscribers of 11.400,000l. at 3 per cent; and of 120,000l. per ann. for 98 years, given in 1762, as a premium to the lenders of twelve millions at 4 per cent. See [page 95] and [100]. It is charged, together with the loans to which it was annexed, on the Sinking Fund.—Its value in the Alley is about 25 years purchase; but the remaining term is really worth 27 years purchase, reckoning interest at 3½, (or the 3 per cents. being at 85¾.) But when interest is at 4 per cent. or the 3 per cents. are at 75, it is worth only 24 years purchase.—When this annuity is called a premium, it must not be imagined, that no compensation was given for it. Government received the value of it; but, at the same time, made itself a debtor for that value. And, what is very surprizing, this has been uniformly practised with respect to all the premiums or douceurs granted by government; and the consequence has been, that great and needless increase of the public debt explained in the 3d section of the 2d Part.

Note (10).—South-Sea Stock and Annuities. See [page 122].—These four capitals amounting to 25.984,684l. 13s. consist almost entirely of the remainder of debts contracted in the reigns of King William and Queen Anne. The following account will probably give sufficient information concerning them.

In 1711, Lord Oxford being minister, the proprietors of certain navy, army, ordnance and transport debts, to the amount of 9.177,968l. including arrears of interest, and half a million for the current supplies, were incorporated into a company for trading to the South-seas. They were allowed 6 per cent. interest for this debt, with 8000l. per ann. for management; and the duties on wine, tobacco, East-India goods, candles, &c. were made perpetual, and granted as a Fund (ever since called the South-sea Company’s Fund) for paying the interest. This kept up public credit at the time, and has been called the Earl of Oxford’s master-piece.—By the 1st of Geo. I. 822,032l. consisting chiefly of interest payable on the Company’s capital, was added to the capital, in consequence of which it was increased to TEN MILLIONS, (ever since called their original capital) bearing 6 per cent. interest.—In 1717, they agreed to take 5 per cent; and this was the first great reduction of interest, which in conjunction with the same reduction of the other redeemable debts almost all carrying 6 per cent. laid the foundation of the Sinking Fund established in this year. But it is remarkable, that so fast did interest fall at this time, that the price of South-sea stock, notwithstanding this reduction, rose from 101 to 111.—In 1719, the South-sea capital was increased to 11.746,844l. bearing 5 per cent. interest (with an addition of 1,397l. 9s. to their former allowance for management) by advancing to government 544,142l. and by the proprietors of 94,329l. 12s. lottery annuities for 32 years granted in 1710, accepting in lieu of them 1.202,702l. South Sea stock.—In 1720, the agreement was made by government with the South Sea Company, which produced the great South Sea bubble.—There existed at that time long annuities to the amount of 666,821l. 8s. and short annuities, for 32 years from 1710, to the amount of 127,260l. 6s. The proprietors of these annuities were allowed to subscribe them into the South Sea trading stock; and the Company, for every 100l. of the long annuity which should be subscribed, were to receive from government an addition to their capital of 2000l. bearing 5 per cent. interest till 1727, and afterwards 4 per cent. till redeemed: and for every 100l. of the short annuities, they were to receive an addition to their capital of 1400l. bearing the same interest.—They were besides to take in the redeemable debts to the amount of 16.546,482l. and to receive an addition to their capital of 100l. for every 100l. subscribed.—By the subscription of the long and short annuities which followed this agreement, a capital due from government to the Company was created, which was greater by 3.034,769l. than the original sum advanced for the annuities subscribed. And as much of these annuities and of the redeemable debts were subscribed, as increased the South Sea trading capital to 37.802,203l.—In 1722, four millions of this capital was purchased by the Bank, (See Note 3.) which reduced it to 33.802,203l.—By 9 Geo. I. 1723, this remaining capital was divided into two equal parts, one of which alone (or 16.901,101l.) was ordered to be the trading capital of the Company, and the other part was directed to be called South Sea Annuities.—In 1733, the South Sea trading capital had been reduced by payments at different times to 14.651,137l. 12s. By an Act of Parliament in that year, this remaining stock received a farther division; and only a fourth part, or 3.662,784l. was allowed to be the Company’s stock; and the other three parts, or 10.988,353l. were directed to be called New South Sea Annuities, in order to distinguish them from the former annuities, which have ever since gone under the name of Old South Sea annuities.—From 1733, to the present time, South Sea Stock has continued the same; but the capital of the Old South Sea annuities has been reduced, by redemptions, to 11,907,470l. and of the New South Sea annuities, to 8.494,830l. And of the whole South Sea debt, which in 1722 was 33.802,203l. there has, since that year, been paid off in all 9.737,119l. This should have reduced it to 24.065,081l. but it is in reality 25.984,685l. The reason of this is, that the diminution just mentioned of the South Sea debt was made in part with money borrowed in 1751, to pay off such proprietors of South Sea annuities as had refused to consent to the reduction of interest proposed to them in 1749. The sum borrowed for this purpose was 2.100,000l. bearing 3 per cent. with 1181l. 5s. for management. This debt is now reduced by redemptions to the sum specified in the preceding account; or to 1.919,600l.

Note (11).—East-India Stock. See [page 123].—In 1698, a company of merchants, in consideration of two millions lent to government at 8 per cent. were incorporated, and entitled to the sole privilege of trading to the East-Indies.—These two millions formed the first capital of the present East-India Company.—In 1702, an old company of traders to the East-Indies was united to this company; and in 1708, these united companies lent to government 1.200,000l. without additional interest, which made their capital 3.200,000l. bearing 5 per cent.—In 1730, this interest was reduced to 4 per cent. and by the 23d Geo. II. 1749, to 3 per cent.—The salt duties, and some additional stamp duties, were at first charged with the annuity due on this capital; but at present the duties constituting the aggregate fund are charged with it.

Note (12).—East-India Annuity. See [page 123].—The capital of this annuity was advanced to government in 1744, at 3 per cent. and, in consideration of this loan, the exclusive charter of the Company was continued to Lady-day 1783, at which time it is to cease, provided three years notice has been given, and the debt due from government discharged.

An observation here forces itself upon me, which I have often had occasion to make.—Part of this loan was a compensation from the East-India Company for prolonging the term of its charter; and, therefore, ought not to have been included in the loan. The Company would have lent 750,000l. on the interest common at the time, or 4 per cent. and the remainder would have been advanced as a gratuity.—It is a pity those who managed these contracts for the public, did not attend to the absurdity and extravagance of making a debt of purchase money, and borrowing in the very act of selling.

Note (13).—Exchequer Long Annuities. See [page 123].—These are the long annuities which, in 1720, remained unsubscribed to the South Sea Company. See Note 10.—They consist first of annuities to the amount of 54,900l. 14s. 6d. purchased by the 4th, 5th, and 6th of William and Mary, for 96 years, from January 1695, with the addition of 1350l. per ann. for salaries to exchequer officers. These annuities were originally 14 per cent. life-annuities. By the 6th and 7th of William and Mary, in order to raise more money, these annuitants, or any other persons for them, were offered a reversionary interest in the annuities after the failure of the lives, till the end of 96 years from January 1695, on paying 4½ years purchase, (that is 63l.) for every annuity of 14l.—The predecessors of the present company of the Million Bank (so called from the MILLION lottery 1694, in which they were some of the principal adventurers) purchased 30,669l. 4s. of these reversionary annuities. The life annuitants being now reduced to a very small number, almost the whole of this annuity is lapsed to the company; and though they have divided for several years 5 per cent. on a capital of half a million, yet their growing savings, from the falling in of lives, have been such, that, when their annuity ceases in 1791, they will, I am informed, have accumulated a fund considerably larger, than the capital on which they have made their dividends. But to return.

These Exchequer Annuities consist farther of

£.s.d.
30,40068purchased for 99 years from Christmas 1705, by 2d and 3d of Anne, with 1450l. for management.
23,234166purchased for 99 years from Lady-day, 1706, by 4 Anne, with 1470l. per ann. for management.
7,776100purchased for 99 years from Lady-day, 1707, by 5 Anne, with 375l. 12s. per ann. for management.
4,71000purchased for 99 years from Lady-day, 1708, by 6th of Anne, with 208l. 2s. per ann. for management.
10,18100purchased for 99 years from Lady-day, 1707, by a 2d Act of 5th of Anne, with 416l. per ann. for management.
Add54,900146
131,20378Total.