Argus (Melbourne, Vic. : 1848 - 1957), Monday 4 October 1880, page 6


THE MELBOURNE MINT.

The establishment of the Melbourne branch of the Royal Mint is a great fact in the history of Victoria. When it was opened, however on the 12th of June 1872 there was a great diversity of opinion as to its probable effects on trade and commerce It was contended that it would keep the greater part of the gold raised here in the colony, and that we should have, greatly to our advantage, a metallic in place of a paper currency. Others were of opinion that the greatest benefit we could expect to derive from it was that it would both raise and steady the price of gold here and some still believe that it has done so whilst many from the first had a vague notion that it would prove a costly luxury to the colony and can hardly be said to have altered their opinion

Now, the best way of dealing with the sub-ject is to bring these opinions to the test of ascertained facts, and that we shall be en-abled to do by referring to the accounts we have of the working of the Mint for the first six or seven years of its existence. With regard to the notion that the establishment of a Mint would keep the gold raised in the colony in our hands, we need say no more here than that it has proved, as most people saw it would from the beginning, a mere popular delusion. Gold has found its way out of the colony since the establishment of the Mint, in the shape of coin or bullion as fast as it ever did before in the shape of dust, nuggets, and ingots. Then, with regard to the belief that the establishment of the Mint would both raise and steady the price of gold, or that it has done so, it will be sufficient, perhaps, to say-first, that it is very difficult to under-stand how it could do that so long as gold has the standard value of £3 17s 10½d. per ounce attached to it; and, secondly, that there is no proof of its having fetched less before the establishment of the Mint or of its having brought more since or of lts having been in any way steadier in its price. Gold in its crude state, has varied in price according to its purity or to the district in which it was raised, but the price of gold of the standard value has always been the same and always will be until the standard is altered. With regard to the other point raised-namely as to the Melbourne Mint being a costly luxury -- that, we think, may be safely left to the arbitrament of facts, after we have gone through the history of its working from the

commencement.

With a view to that we start with the opening of the Mint on the 12th of June 1872, and we give first the gold received for coinage from that date until the 31st of De-cember, 1879. For this we are indebted to the report of Mr Delves Broughton deputy master of the Melbourne Mint to the deputy master of the London Royal Mint under date of February the 19th 1880. In transcribing this table we omit the decimal points in the weight of the gold and the fractional parts of pounds in its value -

GOLD RECEIVED FOR COINAGE AT THE MEL-

BOURNE MINT

Year

1872 1873 1874 1875 1876 1877 1878 1879

Total

Oz.

190 738 221 870 335 317 489 731 543 198 378 310 569 932 659 555 3 385 654

Value at £3 17s 10½d. Per Oz.

764 917

887 125 1 349 101 1 947 712 2 149 480 1 491 819 2 171 000 2 740 000 13 495 327

This does not of course include any of the gold raised in Victoria before the establish-ment of the Mint. Neither dos it include more than a portion of that which has been raised since, say one third or a little more perhaps. Our estimated yield of gold during, the 20 years we were without a Mint was valued at£163 000 000 sterling or thereabouts and our estimated yield since is valued it say

£36 000 000. So that, compared with either of these totals, especially with the former, the value of the gold sent to the Melbourne Mint for coinage since its opening - namely £13 000 000 - may be regarded by some as rather insignificant. But this fact must not

be lost sight of, that the business of the Mint is steadily increasing, as may be seen from the foregoing as well as from the following

table -

ISSUED FROM THE MELBOURNE MINT

Year

1872 1878 1874 1876 1876 l8 7 l8 8 18<0

Total

In Coin (Value £)

743 000 834 500 1 373 000 1 888 000 2 124 000 1 527 000 2 171 000 2 740 000

Quantity (Oz.)

1 205 3 106 2 911 3 552 3 624 3 236 3 691 1 740

In Bullion (Value £)

3 160 11 035 10 416 13 857 14 144 13 004 14 640 6 829

Totals 13 405 500 I 23 157 | 87 538 | 13 493 038

Total Value in Coin and Bullion £

751 610 845 535 1 383 416 1 901 857 2 138 144 1 540 004 2 185 640 2 746 829

On this Mr Delves Broughton remarks in his report of the 10th of February 1880, to the deputy master of the London Royal Mint -

"The coinage of the year has been £2 740 000, all in sovereigns being the largest coinage in any one year aince the establishment of this branch of Her Majesty a Mint and exceeding that of 1878 in which the largest previous coinage took place, by £569 000." For this two or three reasons may be assigned - first the Melbourne Mint is growing more and more into favour; secondly, we no longer send any of the gold to Sydney to be coined;

and thirdly, there was no gold coinage worth speaking of at the London Mint last year. But it should be observed here that some of the gold coined, at the Melbourne Mint in 1879, and during the previous years since its opening came from other colonies, and was not the produce of Victoria. The quantity raised in each colony is shown in the following table :-

Country.| Oz During 1879. I Oz Since 1872.

Victoria - 493 062; 2 519 308

New South Wales - 599; 2 987 New Zealand - 113 106; 689 060 Queensland -124; 1 598

South Australia - 12 807; 68 180 Tasmania - 33 634; 75 596 Natal - Nil; 1 362

Unknown - 3220; 18 500

Total - 656 555; 3 385 654

Oz.

2 519 808

2 987 698 060

1 598 6 8180 75 596

Hence it appears that the gold we send to New South Wales now and the gold we receive thence is reduced almost to a minimun; the quantity acknowledged by Mr Delves Broughton in the above return for 1879 bBiog only 599oz against 65 oz acknowledged by Mr Hunt, deputy master of the Sydney Mint for the same year. This stands out in very striking contrast to the state of things between the two colonies in 1865 and 1869,

when we sent 1 226 076oz of gold to Sydney to be coined and even to what it was in 1871

the year before the Melbourne Mint was opened, when we sent 148 701oz to be coined. It may also be as well to observe here that as the business of the Melbourne Mint is increasing the business of the Sydney Mint is decreasing, as may be seen by the following :-

COINAGE IN MELBOURNE ; AND SYDNEY SINCE 1876

1876 - 2 124 000 ; 1 643 000 1877 - 1 527 000 ; 1 590 000 1878 - 2 171 000 ; 1 322 000 1879 - 2 740 000 ; 1413 000

Total - 8 562 000 ; 5 968 000

" Vi 000 1 o"7 000

171000 2 740 000 S 5a" 000

Syil o

G 0(18 000

Difference in favour of Melbourne £2 594 000.

But this brings us to another and to what many consider the most important part of this question - the coat of the Mint to the colony - and there are different methods of estimating this. Some for instance think the Mint should be made chargeable with the whole of its outfit - with the value of the land it holds, with the buildings erected thereon and with its equipment as a Mint,

at simple or compound interest; whilst others would be quite satisfied if it was made self supporting, or did not, at any rate entail any great annual expense on the colony . Yet no one can, surely, refuse to admit, on reflection that it is altogether unusual, and that it would be very unreasonable,

to charge such an establishment as a mint with its outfit, and those who think the Melbourne Mint ought to be self-supporting should, most assuredly, take into account the circumstances under which it was established, and make such allowances as are demanded in common fairness for the benefits resulting from its establishment. We should never have had a mint at all had we not been prepared to grant on annuity not exceeding £20,000 a year to it, and that limit has

certainly never yet been reached, nor is it ever likely to be. Granted that the Melbourne Mint has been worked at a loss, if we look at its business receipts and expenditure only, as all such establishments usually are. Yet not at such a loss as to swallow up the whole of the annuity guaranteed by act of Parliament, nor at such a loss as to alarm us, even from a business point of view, as we shall presently show.

In reference to the former of these points, the non absorption of the annuity for the last two years - and this, we believe, applies to all previous years - Mr Delves Broughton states in his report for 1879 to the deputy-master of the London Royal Mint -"The saving on the Mint annuity for 1878, namely, £6,349 12s 7d, has, in accordance with your direction, been paid into the Colonial Treasury The saving in the Mint annuity for 1879 has been £5,029 15s 10d. The cost to the colony of Victoria of the establishment for 1879 has been £5,621 13s 3d , against £5,078 2s 1d in 1878. " Nor should we overlook what the deputy master of the Royal Mint says in a previous report of the modifications and improvements in the organisation of the staff of the Mint. Among other things, he says -"Their lordships (the Lords of the Treasury) were pleased to give directions for the preparation of the necessary Treasury warrant appointing Mr. E S Wardell, the present registrar and accountant, to be a principal officer, and to sanction certain increases of salary and rearrangements of duties which Mr. Broughton had recommended. By these changes a considerable reduction has been effected in the expenditure of the department "

How far the Mint has been worked at a loss during the last six or seven years - after throwing aside all considerations as to its being chargeable with its outfit - may be seen from the following table -

RECEIPTS AND EXPENDITURE OF THE MELBOURNE

MINT

Excess of

Revenue | Expenditure| Expenditure

over receipts

1873-4

1874-5 1875-6

1876-7 1677-8 1878-9

Totals

4,799 7,504 7,659 7,512 7,247 7,907 42,628

£

4,972

15 701

9 305 11 229 19 553 13 376 74 136

£

173 8,197 1,646 3,717 12 306

5 469

31 508

From these figures, which we take from Hayter's Year Book, for 1879, it appears that the Ioss since 1872 has been about £5,000 a year, or, in other words, that the working expenses of the Mint have exceeded its receipts to the extent of about 74 per cent. But there is much to be urged as a set-off against this, both in the way of convenience and of direct pecuniary advantage, and we must not therefore, look upon the whole of it as loss. For instance, we are no longer dependent on the banks to assay our gold for us - no longer under the necessity of sending it in large quantities to the Sydney Mint to be coined ; but we can send it to the Melbourne Mint, and have it turned into coin or bullion, whichever we please, at a moderate charge, and that, too, with the least possible trouble or delay. Not only so, but by virtue of our connexion with the London Royal Mint, through the Melbourne branch the Lords of the Treasury have ordered us to be dealt with in the most liberal spirit, and on the most liberal terms, with regard to our silver and bronze currency - with regard to the former in particular. In proof of this we have only to refer to the reports of the deputy master of the London Mint for 1878 and 1879, in which this matter is fully discussed. In his report for 1878, the deputy master of the London Mint,

says -

" In November last I brought under their lordship's notice (the Lords of the Treasury) a report from the deputy master of the Melbourne Mint, including a representation from the associated banks of Melbourne, as to the condition of the silver coinage in Victoria, and recommending that the subject of the renewal of the silver coinage in that colony should receive further consideration at their lordships' hands " Again -

"The associated banks of Melbourne stated that they had on several occasions imported silver coin at their own expense , that they did not consider that to be a duty which should be imposed upon them , and that, when recently appealed to by the Government of Victoria, they had declined to incur the cost of any further

importations. They requested, therefore, that arrangements might be made between the Mint and the Melbourne branch, by which new silver coin could always be supplied by the latter ' free of cost,' that is to say, with out any charge beyond payment of the nominal value of the coin '

How this matter was disposed of, and how it stands now is thus described in the report of the deputy master of the London Mint for

1879 -

"This department has been authorised to pay all expenses connected with the carriage of new silver and bronze coin to the colonies and of worn coin to the Mint or one of its branches. The amount of new silver coin shipped to the colonies in 1878 was only £69,950, whereas in 1879 it rose to £298,470, no less than £125,500 having been sent to Victoria alone, "

Of this advance of £125,500 to Victoria only £24,230 had been repaid in December last, that being the value of the worn silver withdrawn from circulation. These advances are, in fact, only repaid by instalments at

such times as the worn silver coin comes

in.

Hitherto we have taken no notice of what is sometimes said about our being put to the expense of supplying Great Britain with her gold coinage, upon which there is a loss, and of her supplying us with our silver coinage, upon which there is a profit, nor does it, indeed, deserve much notice. There is, in fact, a very small modicum of truth in what is said on the former point, and none whatever in what is said on the latter, so far as we understand the question. We have the honour, it must be admitted, of supplying Great Britain with a portion of her gold coinage, but any expense connected with this is borne by those who find it more convenient or profitable to send their gold to England in the shape of coin than to send it in the form of bullion, or in its crude state. With regard to silver, however, the case is somewhat different, as appears by this passage from the report of the deputy master of the London Mint for

1879 -" In 1879 the profit on the coinage of silver bullion was only £25,548, as against £31,993 in 1878, while the Ioss on worn silver coin, including the worn coin with-drawn from circulation by the Sydney and Melbourne Mints, was £55,047, as against £48,959 in 1878 ' And the loss will, we pre-surne, be greater before the whole of the new silver coin sent out to Melbourne and Sydney is absorbed, so that the loss in one case must be set against the profit in the other.

On a careful consideration of the foregoing facts, it must, we think, be evident to all that whatever of a luxury the Melbourne Mint may be to us, it is not a very costly one. We certainly pay, as we ought to do, for the convenience and the benefits we derive from it, but not to any unreasonable, exorbitant,

or alarming extent. There is no objection, of course, to the reduction of the expenditure on this establishment to the lowest scale consistent with the maintenance of its efficiency , but it is, surely, hardly a time to be very pressing on that point, when the business of the Mint is so largely increasing, and when we have the testimony of the deputy master of the London Mint as to the late improvements in the organisation of the staff having been productive of beneficial results. Not only so, but we have before us a return from Mr. Delves Broughton, just laid

before Parliament, showing what these improvements are, and what the receipts and expenditure of the Mint for the last five years

have been.

According to a previous return, dated August 6, 1872, the cost of the staff was £7,195 a year. Its cost now, according to Mr. Delves Broughton's return, dated September 10, 1880, is £6,485, with a much larger amount of work to be done. The average annual expenditure of the Mint for the last five years, namely, from 1875 to 1879 has been £13,932 a year, and the average annual receipts £8,445 a year. Such is the substance of Mr. Delves Broughton's late report, and it accords altogether with what has been drawn from other sources, and which appears in the body of this article. The actual cost of the Mint to the colony during the last five years has been £5,487 a year, that is the difference between an expenditure of £13,932 and receipts amounting to £8,445 a year. But the cost to the colony during the last two years, as stated by Mr. Broughton in his report to the deputy-master of the London Mint for 1879, scarcely exceeded £5,000 a year, namely, £5,078 in 1878, and £5,021 in 1879.

Another report has since been laid before Parliament, showing the total capital expended on the Mint up to date, with the estimated value of the land it holds. But that appears to us to be trifling with a very grave matter, and to be no more deserving of notice in this connexion than would be a return of the cost of Government-house, the Custom-house, the Law Courts, or any other public building, with compound interest added at the rate of 7 per cent. To no "fancy" return of that kind is the least value or importance to be

attached.