Chapter X, of Cassells Illustrated History of England, Volume 9

When Parliament met for the session of 1865, the Lord Chancellor truly described in a few words the state of England. "Her Majesty," said the Queen's speech, " commands us to inform you that the general state of the country is satisfactory, and that the revenue realises its estimated amount." In truth, the opening of the year was as calm, both at home and abroad, as could possibly be, save for the echoes of storm which still continued to be heard in the West. The American War still continued, but it was quite evident that the collapse was at hand. The war between Denmark and the two great German Powers had ended in a treaty of peace. India was prosperous, save for the traces of the great hurricane which had swept over Calcutta a few months before. In one only of the colonies, New Zealand, was anything visibly disturbed, and there the Maori war seemed to have passed its climax. At home, Lancashire distress had abated; the harvest had been good; the public purse was full. Everybody, so far as politics was concerned, was waiting quietly for the dissolution of the Parliament for which, as Lord Derby said, " all its experienced advisers could do was to find it some gentle occupation, and take care that its dying moments were not disturbed by any unnecessary excitement."

In financial matters, before Mr. Gladstone brought forward his Budget, there had been two important debates in the House of Commons which bore upon it. The first was that on a resolution moved by Sir Fitzroy Kelly, afterwards Lord Chief Baron of the Exchequer, to the effect, " That in any future remission of indirect taxation, this House should take into consideration the duty on malt, with a view to its immediate reduction and ultimate repeal." The malt duty, from which at present the revenue receives six or seven millions sterling a year, has always been more or less of a grievance to the agriculturists; and the representatives of agricultural constituencies are always ready to argue against it. The farmers hold that it puts a serious restriction upon the cultivation of barley; saying that more beer would be consumed, and, consequently, more barley required, if the tax were repealed. Sir F. Kelly and his supporters, who were a numerous body among the county members, Sir E. B. Lytton, the novelist, being his seconder, brought forward several plausible arguments for his motion, principally selected or parodied from the grammar of free trade. "It is," he said, "an axiom of free trade that raw material should not be taxed, and malt may be called a raw material. Moreover, whereas the indirect taxation of the country had been greatly reduced of late years, tea, sugar, tobacco, and wine, having been at least partially freed from duty, malt, a home-grown article, tad been allowed no reduction." Mr. Henley saw no reason to doubt that the law by which increased consumption always followed reduced taxation, should not hold in this case. " In a year or two," he said, " the revenue will be recouped even if it reduces half the duty." But Mr. Neate, the member for Oxford, always notable in the House for the somewhat crotchety cleverness with which he handled questions of political economy, turned the tables upon the landed interest by an amendment. He, and all the opponents of the resolution, maintained that the real advantage of the repeal would fall, not upon the consumers, not upon the farmers, but upon the landlords; for increased receipts on the farmers' part always mean increased rent on the landlords' part. So he moved, " That considering the immunities from taxation now enjoyed by the owners and occupiers of land, they are not entitled to any special consideration on account of the pecuniary pressure of the malt tax; and that if, on other grounds, that tax should be reduced or abolished, compensation to the revenue should be sought, in the first instance, by withdrawing from landed property the advantage it now has in the shape of total exemption from probate duty, and partial exemption from succession duty and income tax." This, however, the House of Commons could not stand; it was too much, at least for an unreformed Parliament, as it probably would be for a reformed one. The supporters of the Government - especially Mr. Milner Gibson, who was its spokesman - contented themselves with the resolution and left the amendment alone. The question was met on two grounds - first, that the revenue could not afford to do without it; and secondly, that though malt was a raw material, stimulants and their components were fit subjects for taxation. Indeed, the figures quoted by Sir F. Kelly had been in themselves alarming enough. "Assuming," lie said " the annual consumption of beer to amount to sixty millions sterling -----." It was hardly necessary to hear more. When it was granted that the amount spent in beer would more than pay the whole expenses of the army, the navy, and the interest of the national debt, the House of Commons thought it unnecessary to encourage the trade to extend itself. Sir F. Kelly's motion was rejected, the " previous question " having been passed, by a majority of 251 to 170.

The other point in which it was proposed to give an instruction to the Government as to the disposal of part of the surplus, was Mr. R. B. Sheridan's motion for extending last year's remission of the fire insurance duty to "houses, household goods, and all descriptions of insurable property." This resolution was carried by a large majority, though the Chancellor of the Exchequer opposed it, thinking it rash to bind the Government to any special course before the exact surplus was known. The vote, of course, secured that Mr. Gladstone should carry out the reduction in question in his Budget.

When the day came for the Budget to be presented, Mr. Gladstone found himself, as usual, in the presence of a crowded and eager House. He did not disappoint his hearers. His Budget speech was, in the words of one of his admirers, one of those "deliverances, crammed with arithmetic and argument, epigram and eloquence, figures and fancy," which he and no other Finance Minister that ever lived in England - M. Thiers perhaps rivalled him in France - knew well how to give. In this instance Mr. Gladstone had an unusual opportunity for an effective display, from the fact of the Parliament having arrived at the end of its existence; he had five previous years spread out before him for review, and could strike out brilliant comparisons, and draw large inferences at his pleasure. Some of his figures may be given. He said that the actual expenditure of the year which had just elapsed was £65,951,000, a reduction of £1,514,000 upon the first year of that Parliament and that Ministry, and a reduction of £6,547,000 upon the year 1860 - 61, when the alarms consequent upon the Italian War had caused us to spend vast sums upon the army and navy. As to a comparison between revenue and expenditure, he found himself with a surplus in hand of £3,231,000. Customs, Excise, and all other great heads of revenue had given more than their estimated amount, Excise especially yielding a million and a half of increase. The prosperity of the country he tested on an even larger scale than this, by a comparison of annual revenues during the last twenty-five years; and showed that whereas the average growth of the revenue from year to year, from 1840 to 1852, was £1,030,000; the same growth was, from 1853 to 1859, at the rate of £1,240,000, and from 1859 to 1865, at the rate of £1,780,000. This was strong evidence of the country's prosperity; and more was forthcoming in the statistics of various trades which he produced. The paper trade, in spite of the outcry of the paper- makers when he abolished the duty, was increasing, the amount of saw material imported in 1865 being exactly five times what it had been in 1859. The trade with France, thanks to Mr. Cobden's Commercial Treaty, had doubled in five years. The total amount of exports during the year ending September 30, 1861, was £487,000,000, an increase of £219,000,000 since 1854. In other words, the export trade of the country had nearly doubled in ten years.

To all this encouraging retrospect Mr. Gladstone added his own gifts for the future. He had a large surplus to dispose of, and what was he to do with it? As he said, there are always " crowds of hungry claimants " for a surplus; everybody who suffers from a tax that his neighbours are exempt from thinks he suffers an injustice and struggles to get it redressed. It is enough to say that the malt tax was not touched; and that the duty on tea was lessened by sixpence per pound, and the income tax lowered from sixpence to fourpence in the pound. It is needless to say that these reductions were received with gladness by the House and the country, though the irrepressible malt tax repealers felt themselves hardly used.

The other two important financial statements (leaving the finances of India to be mentioned in a future page) were, of course, those made in moving the Army and Navy Estimates. Of neither is there very much that requires to be recorded. The Marquis of Hartington showed great clearness of head and general administrative ability in moving the Army Estimates; but he had little to say except to move for a reduction of 4,000 men in the establishment. The alarm of 1860 had passed away, and the alarm of 1870 had not come; so there was neither increase nor re-organisation to be accomplished. The only difficulty with which Lord Hartington had to deal was the everlasting, insoluble gun question, new phases of which are ever occurring and ever likely to occur. Similarly with the navy, for which a little over ten millions were voted. There, too, was to be a reduction, especially in the coastguard and marines; and there also were to be fresh ships built on fresh models. Lord Clarence Paget, who moved the Estimates, pronounced himself satisfied with the general efficiency and discipline of the service; and the House generally agreed with him.

Turning from finance to the other departments of public business, one is not surprised to find that in the last session of an old Parliament, with Lord Palmerston still living and directing its course, but little positive legislation was accomplished. An expiring Parliament is never fertile; it produces infant measures, but has not the force to bring them to maturity; and in the consciousness of approaching death, it makes its peace with the future by recording good resolutions. Lord Palmerston, too, in the last year of his life, showed no intention of departing from his well-known home policy - namely, to let things be ever doing, never done. Thus it happens that the history of the session of 1865 reads like a table of contents of the five or six sessions that followed it. There is a sound as of immense activity, but it remains for a time without result. One is astonished by the number of projects with which the brains of honourable members appear to be teeming. Almost all the important questions that have since been solved, or at least handled, by the Government of Mr. Gladstone, were brought forward, discussed, and left unanswered in 1865. The Irish land question was touched upon, in a debate on a motion of Mr. Pope Hennessy, at the beginning of the session, and discussed at length on Mr. Maguire's moving, on March 31st, for a select committee. The Irish Church question was raised by Mr. Dillwyn, and the debate which followed was re mark- able as extracting from Mr. Gladstone a clear statement of the views which he afterwards put into effect. Mr. Berkeley brought forward his Ballot Bill, but in vain. The Test question was raised by Mr. Göschen. National Education, both in England and Ireland, was before the House of Commons in two important debates. The O'Donoghue moved an address to the Crown referring to the question of University Education for Ireland. And lastly, Mr. Baines took the feeling of the House on the question, soon to become all-important, of Parliamentary Reform. Besides these, which may be called premonitory symptoms of future legislation, there was, of course, a good deal of important but unpretending work actually accomplished, which we may shortly record. But first it will be worth while to dwell for a moment upon one of the abortive measures, that of Mr. Baines. The rest were not only abortive, but they led to nothing immediate; whereas the debate upon this measure had an intimate and direct connection with the general election which followed the dissolution. " Reform " was the cry with which the Liberal party went to the country.

The main object of Mr. Baines' bill was substantially the same as that of the Government bill of the next year - namely, to reduce the limit of the borough franchise from a rental of £10 per annum, where it had been fixed by the Reform Bill of 1832, to a rental of £6. The measure was, as we said, abortive; its introduction seems indeed to have been only intended to stimulate popular interest in the question of Reform; but the debate has become historical from the great speech in which Mr. Robert Lowe, member for Calne, in Wiltshire, passed at once and beyond all question from the second to the front rank of parliamentary orators.

Mr. Lowe had chosen his opportunity well. No moment could have been more favourable for declaring war against the inevitable enemy. Mr. Lowe saw very well that Reform was to be the immediate question of the future, and that both of the great political parties agreed to look upon it in that light. The question had slumbered since 1859, lulled to rest by Lord Palmerston; but now popular interest was beginning to revive, the Press was taking up the problem in serious earnest, and a general impression was abroad that Lord Palmerston's day was over. In proportion to the popular interest in the question, in proportion to the shortness of its own remaining life, was the dislike of the existing House of Commons to the very name of Reform. Their " unerring instinct " told them that the time of their peace was at an end, bound up as it was with the predominance of their present leader. Reform, as they saw, meant an indefinite future of agitation; meant grappling with question after question which till then had lain comfortably in abeyance; meant the infusion of new blood into the councils of the country, and the application, in all probability, of dangerously new ideas. Hence from the Whig as well as from the Conservative benches - from all, in fact, except the benches below the gangway on the Liberal side - the cheers rang out as Mr. Lowe, the most impartial of cynics, the narrowest of utilitarians, a Liberal without enthusiasm, a Tory without prejudices, delivered the first of his famous philippics against the democracy of the future.