Thursday, September 29, 2005

The Restoration: the financial settlement

It was essential to constitutional harmony that crown and parliament agreed on a working financial arrangement. But this did not happen. The Convention calculated that, in compensation for the loss of feudal revenues such as wardship, the crown needed a settled income of £1.2 million per annum (a figure drawn out of a hat?) but it never provided it. In November the Convention decided to grant the Commonwealth liquor excise to Charles for life. The duty was raised on beer, cider, mead and strong waters, and also on coffee, tea and chocolate per liquid gallon, as sold in the coffee houses. It was estimated that this would bring Charles an income of c. £400,000 pa and customs duties a similar sum - but as Clarendon was well aware, this still left the crown short of money. The economic recession of the 1660s did not help crown finances.

There was no long-term strategy behind the financial settlement. MPs did not understand the complexities of public finances and underestimated the needs of the crown. They did not foresee that the army would remain in being and that the garrison at Tangier (part of Catherine of Braganza’s dowry) would cost nearly £150,000 pa. Charles and his ministers were unwilling to court unpopularity by demanding high taxes, following the unprecedentedly high taxation of the Cromwellian era. The result was that when the Convention broke up, the crown was in debt and its ordinary revenue fell short of what the Convention itself had calculated that it needed.