Chapter X: Part 10

By similar treatment to that applied to the table on page 132 this will yield an average loss between June, 1851, and March, 1857, of £698 13_s._ 3_d._ per million coined; whereas in the period from April, 1857, to March, 1860, there is a gain by melting of £87 13_s._ 3_d._ per million pounds sterling coined. To look a little more closely into these figures, it will be observed that in the year 1858-59 there was a positive gain of no less than £505 16_s._ 2½_d._ on each million coined; this is not to be explained by any known fact, but it seems probable that in that year a circumstance occurred that had happened many times previously, and from the prevalence of the same folly. At the Mint Office it is the custom to weigh the silver from the coining department to the melting department in drafts of 1,440 ounces, or for occasions of 720 ounces. Now it not unfrequently happens that the weigher leaves the counting of the number of drafts to his scalesman, and so an error creeps in. Some days afterwards the coining department finds itself short, say 720 ounces, and by searching its books finds it has been credited with too little on a specific day; after investigation the error is admitted, and the old receipt altered. Now such an error happened on the 3rd of August, 1858, when 1,440 ounces, or two journeys, were delivered, but not credited; however, on the 16th August this was discovered, and the receipt altered at the Mint Office. It is probable that the melter never made a corresponding alteration in his books, and if that be the case, the gain of 1858-59 will disappear, to be replaced by a loss of £487 0_s._ 8¼_d._, which would appear to be more natural. Should these lines meet the eye of the officer concerned, he could at once see if this be the explanation of so large a gain, and which has caused him much anxiety. That a gain can be made by melting is not a fact, although, if the statement be examined for the year 1855-56, it will be seen that a gain of £3 0_s._ 10¼_d._ appears to have been made; and once more, in 1859-60 a plus of £82 12_s._ 0¾_d._ per million seems to have been realised. These facts, taken as they stand, would mislead, and for reasons which shall now be stated. Sufficient is, however, here shown to prove that the stoppage of the use of oil effected a reduction in the habitual loss of the melting-house, while this fact renders it impossible to show that the stoppage of loss in the coining department was due to the more free use of oil and dirt (see page 131).

In July and August, 1858, the melter being absent on leave, I was directed by written order of the Master to take his duties. Silver being under operation, the following quantities were melted, and with the results recorded:—

GIVEN TO MELT.
Ounces.
Ingots and alloy 434,393·548
Scissel 457,032·810
Clean ends 1,440·000
Extra alloy 499·539
Plus on weight charged by Mint Office 51·680
-----------
893,417·573

PRODUCED BY MELTING.
Ounces.
Bars 889,974·690
Ends 2,154·750
Grains 462·050
Assays 114·230
Loss by melting 711·853
-----------
893,417·573

To analyse this loss—for by weight it was absolute—will give much information, and the details of proportionate loss were as follows:—

On each Million
Ounces Melted.
On ingots of silver (produced from lead by Pattinson’s
process) and alloy for the manufacture of medals 947·91
On ingots, 5-franc pieces, and alloy 263·85
On ingots, 5-franc pieces, scissel, and alloy 418·40
Worn coin (culled from circulation) and scissel 710·06
Scissel melted by itself 1,036·45
--------
Mean Loss 675·34

Thus, then, it appears that upon this weight of silver and alloy there was, when melted, a loss of 711·853 ounces, or a mean loss of 675·34 ounces in standard silver; yet, on two undoubted occasions, the table above given[114] exhibits a gain upon the work of two whole years; why, therefore, should the loss just stated have been permitted to take place, when every atom of metal was weighed in the presence of witnesses before being placed in the pots, and was not lost sight of by the officers concerned until it was returned to the scales to be again weighed? The reply is simple: the gain in 1855-56 and 1859-60 was not made, and its appearance is simply a matter of account, for the melter was not accustomed to, and probably to this day does not, weigh silver into his melting-pots—he is, or was, satisfied with the Mint Office weights, which are so far from accurate that no ironmonger would accept them.

On this melting alone, including 29 days’ receipts from the Mint Office, there were differences to the extent of 82·11 ounces plus their weight, and 30·43 ounces minus their weight, so that if the one be deducted it still leaves an absolute plus on the weight charged by the Mint Office of 51·68 ounces. Here, then, is a means of gain;[115] but if the increase of weight derived from this source be taken on the ingots and five-franc pieces bought, it is at the rate of 203·60 in a million ounces purchased. Besides this, the melter is not charged with the extra alloy he puts into his silver, and this on an ordinary average amounts to 1,126 ounces on each million ounces wrought; so that this work, which, in fact, did yield a loss of 711·853 ounces, or at the rate of £796 on the million pounds sterling, would, by the old system of computation, have lost £201. Since, then, it is thus demonstrable that a difference of £591 arises when it is known that the whole of the day’s work is weighed into as well as from the melting-pot, it is but reasonable to believe that a greater difference may have arisen when it was known by the Mint Office weigher that his weights were not checked, and, therefore, in weighing ingots to the melter, he probably just satisfied himself that they were as heavy as they were charged by the bullion dealer, and allowed the plus weight which is invariably given by that merchant to go to the melting-house not charged into the account. It is a fact that if the weigher finds ingots sent by the bullion dealer lighter than the weight charged, he sends them back, this practice not being rigidly dependent on the actual weight of the ingots as a whole; for unless each one is distinctly heavier than the weight set against it, it is returned, or the dealer must send silver to make up the required weight. And this case has more than once arisen; so that in practice, if an ingot be charged as 1,000 ounces, it must weigh indefinitely beyond that weight up to 0·50 ounce, and is then received as 1,000 ounces; but if it weigh in addition 0·60, then it is received as 1,000·50 ounces. These “drafts,” as they are called, amounted on 402,573 ounces of ingots to 82·11 ounces, or at the rate of 203 per million ounces bought. When calculating the proportion of metal for melting, it is the custom to add 1 part of extra alloy to the thousand ounces of silver, and thus to allow for the loss which takes place by annealing and blanching. The extra alloy is not charged to the melter, as before said, but is weighed to him, and thus goes really to reduce his loss; in practice its proportionate use is increased, for after several re-meltings of scissel (see page 35) the bars become richer in silver than is required by the law, and then again extra alloy is added. In the case of the silver melted in 1858 it must be stated, that if from the loss exhibited the value of the sweep be deducted, that loss will still be too high, because the silver had not yet been recovered from the melting-pots; but with this allowance made, if we divide the total value of the sweep from 1851 to 1857 by the total sum coined, we shall arrive at a fair average price of that sweep, which may be taken at £404 2_s._,[116] thus leaving a loss of £392 on each million pounds sterling coined. But if, by the old style of calculation, the melter’s loss be estimated on the weight charged to the melter by the Mint office, it is £201, and this sum deducted from the average value of the sweep will give a gain of £203, where it is perfectly certain, from the extreme care which was taken, that the real loss was £392, which, minus £54 4_s._ 7_d._, subsequently explained, becomes an absolute loss, by melting weighed quantities, of £337 15_s._ 5_d._ per million pounds sterling melted. Allusion has been made to the silver left in the iron melting-pots: in the case which has been so much dwelt upon cast-iron pots from Glasgow were used, these absorbing an exceptionally large amount of silver. As, however, the object is to arrive at a fair average, it will be wiser to take into consideration the ordinary wrought-iron pot, which, although it costs more at first, is cheaper in the long-run, as it will stand from fifty to sixty meltings, whereas the bulk of the cast-iron pots used in 1858 leaked in the first melting, and no one of them stood a whole day’s work.

[Footnote 114: See page 134.]

[Footnote 115: See pages 127, 130.]

[Footnote 116: See page 134.]

In treating of the melting of silver, it has been explained that charcoal is placed in the pot, to prevent the oxidation of the alloy. This, to a measured extent, it effects, but in the process it becomes burned, and its ash forms a slag with the oxide of iron of the pot, and this slag, always floating on the top of the fused silver, gradually covers the inner surface of the pot as the silver is poured out, and in so covering the pot secretes globules of silver in the “pin-holes” of the iron. At the end of the useful existence of the pot this silver is, or rather should be, obtained. The practice is to “sweat the pot,” and to fuse in it some common table salt—chloride of sodium. It would seem that the used-up wrought-iron pots yield by this process, on an average, 12 ounces of silver. But all the silver is not obtained at this operation, for the pots stand out of doors, in a yard to which many persons have free access, for months before they are treated professionally, and the result of the preliminary sweat which they undergo is not a source of profit to the Mint.

In 1858 two wrought-iron pots were locked up when their active period had passed, and these were subsequently treated with great consideration, with a view to ascertain their capacity for retaining silver. They yielded under my hands:—

Ounces.
By simple sweating 20·00
By detaching the slag and oxide from the pot
and fusing it with salt 24·70
By separating the remaining silver from the pin-holes
in the pot by means of diluted acid 4·60
------
49·30

In the whole period of that melting I used nine wrought-iron pots, of which three were entirely used up, and six cast-iron pots, all of which leaked—some two on one day: it would therefore seem fair to assume that of these fifteen pots eight were worn out. We may then consider that had all the eight pots been carefully treated, and each made to yield its fair proportion of silver, we should have recovered silver at the rate above shown, or 24·65 ounces from each pot, and this weight, multiplied by eight, as proposed, will give 197·20 ounces, which, at 5_s._ 6_d._ an ounce, would be worth £54 4_s._ 7_d._, and by this amount may that loss of £392 be reduced, when the actual loss will be £337 15_s._ 5_d._, as determined by most carefully-conducted operations on weighed quantities. This loss, however, is not final, although absolute, because the sweep was sold for £289 2_s._ 10¾_d._;[117] and, deducting this, the final loss is £48 12_s._ 6¼_d._ on each million pounds sterling melted. There can be no doubt but that this is at least one-third in excess of the loss which should take place; yet, between 1851-57, it was, after all deductions for sweep, recoveries from worn-out pots, &c., had been made, no less than £698 13_s._ 3_d._ This excess might be accounted for either as wasteage in the melter’s department, or as legitimate loss by melting caused by the excess of oil sent on the scissel; but since the coiners permitted unnecessary loss to accrue, it will be right to charge this sum to their account, because, if they received metal free from oil, and returned it to the melter sustaining too much oil, it is evident that they received from their men bullion and oil in place of bullion. I therefore add £650 0_s._ 8¾_d._, the difference between £48 12_s._ 6¼_d._ and £698 13_s._ 3_d._, to the wasteage previously explained,[118] when that sum will be raised to £1,297 16_s._ 0¾_d._ on each million of silver coined.

[Footnote 117: See page 134.]

[Footnote 118: See pages 131, 136.]

In all former calculations the value has been determined on the million coined; but now that we approach the necessary considerations as to the loss by melting which should absolutely take place, it becomes necessary to state that, as a rule, 100 parts of silver bars should produce 57 parts of coined money, and in this proportion must the value of the sweep be reduced, that we may obtain its value proportioned to the silver lost by weight in melting. The sweep results, as in the case of gold, from the grinding of the burnt refuse of the melting-house, which consists of the sweepings from the floor, partly-used charcoal, and dirt—“matter in the wrong place,” as Lord Palmerston so aptly designated it. At the end of the coinage this is sold, and its value is applied to the reduction of the apparent loss by melting. In the case now under discussion, we have found that there was an absolute loss by weight of 711·853 ounces on 893,417·573 ounces of bullion given to be melted. By proportion, this weight is equal to 796·764 ounces on each million. The sweep was sold for £289 2_s._ 10¾_d._ for each million coined; therefore, to obtain the specific amount that should be deducted by this source from the loss, we must assume that the coined money was 57 per cent. upon the bullion melted, when £164 16_s._ 3½_d._ becomes the value of the sweep belonging to each million melted. Since this sum is calculated by value, we will convert it into ounces, which is a simple process; for, as the other sums bear proportion to pounds sterling, we have but to consider it as ounces, when the sum we require will be 164·814. To this sum is to be added the amount of silver due from the melting-pots, as before explained, and which is 220·724 ounces, because it has been assumed that we should obtain 24·65 from each on the average number of pots used in melting, and this, calculated into the million, is as above. The total of these two sums, 385·538, deducted from 796·764, leaves a final loss of 411·126 ounces by weight in melting a million ounces of standard silver.

By experiments made with the utmost care, I arrived at the conclusion that, in melting silver bullion for a complete coinage, the loss by melting should not exceed £100 on each million sterling melted, and in this conclusion I am confirmed in a remarkable manner by Colonel Smith,[119] who, with vast opportunities for careful every-day work and by absolute weighing, found a loss of 200 in each million for dirt and oxygen alone, and this he is willing to consider as 250 on each million of scissel; but he found his loss by melting ingots 30 on the million, and assuming that the total of a coinage would be half ingots and half scissel, this would give an average of 140 when he was “convinced that he was robbed,” and that this was so he proved by compelling the naked workmen, by means of physic, to disgorge the silver they had swallowed. He, however, was probably still robbed, for black men rub pieces of bullion or coins together and secrete the dust obtained by that means in their hair, and thus abstract metal from the works of the Brazilian Mining Association, and probably from the mints in India. To such an extent is robbery by this means carried on that the Association above referred to causes the head of each person to be washed before he leaves work, and thus recovers a large amount of gold dust.

[Footnote 119: See Report by Colonel J. T. Smith on Indian Mints from 1841-2 to 1852-3. Printed by authority at Madras, 1855.]

If then, as has been shown, there is a final loss of £411 2_s._ 6_d._ on each million of silver melted, we must now determine that this sum amounts to £721 5_s._ 5½_d._ on each million pounds sterling _coined_; and since by coining a loss is sustained equal to £365 15_s._ 10½_d._, the total final loss is no less than £1,132 7_s._ 11½_d._ per million pounds sterling of silver coined. Such being the facts ascertained by the scales, we find that the loss by ACCOUNT is returned at £365 15_s._ 10½_d._ for the coining department, while, at the same period, the melting-house account shows a gain of £87 13_s._ 3_d._, which, deducted from the loss of the coining department, gives a final loss equal to £278 2_s._ 7½_d._, as against, in the former period, a loss by coining of £1,013 11_s._ 2½_d._, and by melting of £698 13_s._ 3_d._, or a total final sum of £1,712 4_s._ 5½_d._ The difference, then, between these two final sums, or £1,434 1_s._ 10_d._, shows the actual loss that the Mint authorities submitted to without explanation on each million of silver coined between June, 1851, and March, 1857. This sum is exactly 8_s._ 8_d._ for each £100 coined, while the French contract to coin each £100 for 15_s._, including loss, wages, salaries, &c. Although, for the sake of accurate demonstration, I have accepted the facts as stated, it is but fair that I should compare the results actually obtained with those stated by the usual methods, and then the contrast will become more apparent; for whereas the proportional loss by melting is shown to have been on weighed quantities £721 5_s._ 5½_d._, it is a fact that by the usual methods of account, that of neglecting to charge to the melter the extra weight added to the ingots by the system of purchase, and omitting the weight of the extra alloy, this loss becomes reduced to insignificant proportions, for it was exactly £180 0_s._ 1_d._, and as the sweep sold for £164 16_s._ 0½_d._ per million melted, the final loss would be but £15 3_s._ 11½_d._ Yet, for the sake of truth, I consider it better to charge to each department the metal by weight, and that weight should include every atom, because then, an exceptional loss having taken place, its significance is at once apparent; whereas, when unknown weights are placed in the melting-pot, the losses may vary to a considerable extent, and yet not be detected. By this plan fictitious gain becomes impossible—apparent loss inevitable; but _that loss is so determinate_ that it can be calculated to a nicety, and any figure obtained beyond that _calculated_ exhibits one of two facts,—that the melting or coining, or both, have by too great a degree refined the silver under operation, and this is demonstrated by the final assays, or UNNECESSARY WASTE IS AGAIN PERMITTED, but both result from carelessness; therefore the Mint Master’s duty is perfectly clear. While, then, absolute gain is impossible, and loss inevitable, it is, perhaps, well to exhibit the results of Colonel Smith’s experience in the Indian Mints, because that gentleman states that there can be no loss, and that there must be a gain. Thus, then, he and I are antagonistic on the plainest possible point; yet an examination of his statement will show that his gain, although absolute, is not legitimate, but results from a near approach to obtaining bullion without paying for it.

It must, then, be explained that in England, and in the Indian Mints, it is not the custom to assay bullion with a view to the determination of its actual value, but only to the nearest part of a pennyweight. Thus, standard silver is composed of 222 parts of silver and 18 of copper in 240. Assuming that it is the custom to determine the amount of silver to within half a pennyweight; and that, the assay showed 23 pennyweights and 11 grains, the silver ingot would be reported as containing 23 pennyweights, and the owner would lose the 11 grains, whereas it should be the custom to determine absolutely the real value of the ingot. Now, in India, Colonel Smith found these “unreported fractions,” when alloyed with copper, amounted to 1,230 parts on each million purchased, so that if he paid for a million ounces, he received 1,001,230 ounces. Here, then, was part of his profit. In addition to this gain he made another by the customary turn of the scale,[120] but he has not told us its amount; yet his final result, from the receipt of the bullion to its return to the merchants as coined money, is at the rate of £1,165 gain on each million pounds sterling coined. Now it is clear that if so large a sum as £1,230 per million is obtained without purchase from the merchant, either that merchant should himself saturate those unreported fractions with alloy, or make Colonel Smith’s mints pay for them. It is asserted that this practice “exists in the Royal Mint, but not to so large an extent;” yet Colonel Smith states it to be at the rate of £932 per million coined. If this be the case, the Mint books should show for its official accounts a vast gain, instead of, as is the case represented by its purely manufacturing accounts, a loss. This may possibly be the case, but, so far as my experience goes, it is against the practice; for the bullion received is invariably greater in weight than that returned in coined money.

[Footnote 120: See pages 137-138.]

Colonel Smith has determined with great precision that from dirt alone there is a loss by melting of 1 part in each thousand melted. Before he paid for bullion he invariably insisted on its being pre-melted, because the Mint thus saved the loss occasioned by adhering dirt and extraneous matter; this was wise if the merchants would submit to it, but it is doubtful if English bullion dealers would first melt dollars and five-franc pieces before selling them to the Royal Mint.

With bullion thus manipulated I have shown that the Royal Mint also made a gain, but such gain is not real (see pages 136, 137, 138), for it is evident that the silver having been bought with the intention of being converted into standard silver, each grain should be alloyed, and the whole amount of fine silver being thus alloyed should produce its calculated weight of standard silver; therefore in each department every atom should be weighed, and the total weight charged to any particular operation returned or accounted for, and under these circumstances no gain can result.

Colonel Smith, however, has determined with great care the following facts from every-day work, and these are so valuable that it is deemed wise to quote them. He found, then, that he made an actual gain by coining from the above circumstances of 1,230 ounces on each million ounces of rupees produced as coin. In the blanching of the blanks that were used for the making of that coined money the loss by blanching was at the rate of 966 ounces per million blanched, and from the acid used in blanching he obtained 726 ounces of metallic copper, so that of the 966 ounces which disappeared only 240 ounces were a real loss, which resulted from oxygen and dirt. Here, then, are reliable figures; and, as he sold his sweep for a sum equal to 140 ounces of silver for each million ounces coined, it is clear that his real loss was just 826 on each million ounces coined. It must be seen that although the copper was recovered, it should in these calculations be neglected, because in the Royal Mint it is not in practice deemed wise (nor, indeed, is it the every-day custom in India) to separate this copper; therefore we will consider the whole matter lost to the Mint. Since, then, he has demonstrated that he received in his clean ingots more silver by 1,230 ounces than he paid for, it is only necessary to add this sum to the weight he charges to himself, which will then be 1,001,230 ounces; in manipulating this total weight he shows that he lost 554 ounces by melting and 826 ounces by blanching, or a total loss of £1,380 per million pounds sterling. This, compared with the practice in the Royal Mint, shows, as Colonel Smith says, that the Mints of India do not obtain their legitimate amount of profit; and he, in his own words, attributes the loss to what he considers its only fit cause—“peculation.” For even in the Royal Mint—ill-managed institution that it is—the average annual loss, taken by the system of weighing, is only £721 5_s._ 5½_d._ Still, as showing the fluctuations, it is curious to observe that in the last period given, viz., from March to June, 1861, the recorded loss by melting is £91 0_s._ 8_d._, while that by coining is £1,949 9_s._ 6_d._,[121] or a final loss of no less than £2,040 10_s._ 2_d._

[Footnote 121: See pages 132-134.]

Having given the returns relating to gold ordered by the House of Lords, I also give those exhibiting similar details for silver, and place that relating to coining on page 133, while that demonstrating the facts as regards melting will be found on page 135.

Mr. Fremantle assures us in his Report that “the ‘waste’ shown to have existed of late years has not been excessive,” while Mr. Roberts tells us, “The apparent loss on silver melting is two grains on the troy pound, or 0·346 per mille, much of the metal being recoverable from sweep.” 0·346 per mille is 346 per million, so we will take these two statements into consideration as regards the returns now to be noticed.

I propose to submit the following abstract from the return on page 135, and thus bring into view _facts_ recorded by the Mint Officials, that they may be contrasted with _opinions_ expressed by those gentlemen, and for this purpose I deduct the value of the sweep from that of the waste, and thus arrive at the amount of the latter, and as “of late years” may fairly be taken to express the five last past, I will operate on those periods only.

+---------------+-------+------------------+------+----------------+
|Value of Waste | |Value of Sweep per| | Final Loss by |
|per £1,000,000.| | £1,000,000. | | Melting |
| | | | | Silver. |
+---------------| |------------------| |----------------|
| |Deduct | | The | |
| £ _s. d._ | Value | £ _s. d._ |Result| £ _s. d._ |
| 782 17 4 | of | 522 1 10 | is a | 260 15 6 |
| 1,752 18 2 |Sweep, | 211 12 9 | | 1,541 5 5 |
| 1,680 9 11 | | Nil. | | 1,680 9 11 |
| 1,587 14 9 | | 1,313 11 3 | | 274 3 6 |
| 1,002 17 6 | | 188 18 2 | | 813 19 4 |
+---------------+-------+------------------+------+----------------+
| Total Loss divided by 5 years 4,570 13 8 |
| ----------------+
| Gives the Average Loss by Melting Silver 916 2 8¾ |
+------------------------------------------------------------------+

In other words, the loss which actually accrues is practically three times as great as Mr. Roberts finds necessary, and yet Mr. Fremantle approvingly says _it is not excessive_. I should advise Mr. Roberts to return to the use of wrought-iron pots and pay proper attention to the melting, FOR I HAVE PROVED that £100 on a million sterling is as much waste as should LEGITIMATELY arise, and Colonel Smith confirms my determinations, as will be seen at pages 140-141. If these officers will pay sufficient attention to their business, they need not fear the variations of assay pointed out by LEVOL. These arise, it is true, but to an imperceptible extent only when melting is properly conducted, as I proved to the entire satisfaction of Mr. Graham in August, 1858, and who, in consequence, relinquished his intention of adopting the then proposed mode of taking silver for assay from the fluid metal by ladles. It is not by hunting hopeless hobbies that losses are to be stopped, nor will the silver be found in the chimneys—if so, some of it should be in those of the present Mint. Will Mr. Fremantle or Mr. Roberts state what has become of £916 worth of silver from each million coined in the past five years? The actual value lost is £4,580 14_s._ 6_d._, sufficient to make four immense ingots, which would surely stop the draught of any chimney in the Mint.

As this return has yielded matter for comment, I will refer briefly to that which exhibits the additional loss by coining, and shown on page 133, the following abstract for the past five years will suffice.

+-----------------------------------------------------------------+
| Value of | | Value of | | Final Loss |
| Waste per | | Sweep per | | by Coining |
| £1,000,000. | | £1,000,000. | | Silver. |
+-------------| |--------------| |------------------|
| £ _s. d._ | | £ _s. d._ | The | £ _s. d._ |
| 568 0 9 | Deduct | 28 15 7 | | 539 5 2 |
| 481 19 4 | Value | 31 16 9 | Result | 450 2 7 |
| 512 8 8 | of | Nil. | | 512 8 8 |
| 492 16 11 | Sweep, | 458 7 8 | is a | 34 9 3 |
| 469 16 2 | | Nil. | | 469 16 2 |
+-----------------------------------------------------------------+
| Total Loss divided by 5 years 2,006 1 10 |
| -----------------+
| Gives the Average Loss by Coining Silver 401 4 4¼ |
+-----------------------------------------------------------------+

Whereas then the loss from 1851 to 1857 averaged, as I have shown on page 131, £1,013 11_s._ 2¼_d._, and fell under my management in the period between 1857 and 1860 to £365 15_s._ 10½_d._, it has now again risen to £401 4_s._ 4_d._—a steady increase at the rate of 10 per cent., which seems unreasonable.

A rigid Parliamentary inquiry into the circumstances of the Mint is as great a necessity at this time as it was shown to be in 1856; and such an inquiry might demonstrate not only a want of ability, but also whether all the officers are satisfied; whether there be not great heart-burnings, tending to a not very complacent style of performing their duty.

I quote the following from Hansard’s Debates, as having occurred in the House of Lords, to show that the Government steadily resists inquiry into the affairs of the Mint; yet I hope the time will arrive when Parliament will assert its right and induce Ministers to yield an inquiry, however much “Mr. Lowe may deprecate it.” On the 22nd March, 1870,

“LORD KINNAIRD said: I stated the other night
that great robberies have notoriously taken place, and
I maintain that these peculations and robberies still
continue. If I had an opportunity before a Committee, I
could prove this, but the returns which I have obtained
will show the correctness of what I am stating. I was not
surprised the other evening at a particular return being
refused, for the officials of the Mint naturally dislike
further exposure; but the returns before us clearly show
that under the term ‘waste,’ which should rather be
‘stolen,’ large sums are lost in coinage. There ought to
be no loss in coinage if the Mint was properly conducted.
There might, indeed, be a small loss of £100 on the million
in the melting department; but in the coining there should
be a gain of at least £59, making the net loss £41. Instead
of this, however, there was a loss, as those returns show,
of £460 on every million coined. What becomes of that sum?
It must go into some one’s pocket, and in point of fact
it is abstracted. Look, too, at the large sums which are
paid to the Bank of England for loss every time there is a
coinage; at one time there was a loss of £1,132 on every
million for loss of gold abstracted and not returned in
coinage. From 1851 to 1857 there was a loss; in the next
two years there was a gain; the next two years there was
a loss and the following year there was a gain, and after
that losses. Now why should not the gain continue? Why
was there a gain? Because the men were properly looked
after, and could not abstract the precious metal.... I
hope your Lordships will agree to refer this bill to a
Select Committee, or will hereafter agree to an independent
inquiry into the Mint, conducted by other gentlemen than
the Chancellor of the Exchequer’s Private Secretary and the
Deputy Master.... I move that the Bill be referred to a
Select Committee.”

I again quote Hansard’s Debates, 24th March, 1870:—

“LORD KINNAIRD said: The noble Marquess, (the
Marquess of Lansdowne) stated on Tuesday night that there
was a considerable profit on silver, which no doubt ought
to be the case; but the returns obtained by an Honourable
Member in the House of Commons showed that, though in some
years there was a gain, in nine years the total loss on the
coinage of silver was £5,373. Bad workmanship, he might
remark, made the coins much less durable, and therefore
caused expense by rendering earlier repair of the coinage
necessary. He hoped that, later in the session, the
Government would concede an inquiry into the management of
the Mint, when he would undertake to prove his allegations
of mismanagement and peculation, and indeed the returns
proved this....

“The MARQUESS OF LANSDOWNE thought that the noble
Lord confounded two things. There was a loss incurred by
the public in keeping the silver coinage up to its proper
standard; but in its manufacture into coin, there was a
considerable gain, amounting to something like £20,000.”

Again, on the 18th July, I also quote from Hansard’s Debates:—

THE MANAGEMENT OF THE MINT.—MOTION FOR A SELECT COMMITTEE.

“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 |
+-------+----------------------------------------------------------+