William Pitt Research Paper

HOW FAR DID PITT’S POLICIES SUCCESSFULLY MEET BRITAIN’S ECONOMIC AND POLITICAL REQUIREMENT BETWEEN 1783 AND 1793?

William Pitt the younger became prime minister of Britain in 1783. Britain was in a political crisis having just lost the American war of independence and was also in a huge debt of approximately £242million. Being in the midst of the political and economic turmoil, Pitt introduced several policies to be on top of things and in this essay I am going to assess the success of these policies in meeting Britain’s need between 1783-93.

The 1770’s witnessed a fall in the real value of Britain’s industrial and commercial production. At the same time the national debt rose by 91% to about £242million and the value of exports fell
by 12%. Annual payment was only £18million, while the interest payments were £9million and normal annual expenditure was £20.
To solve this economic crisis, Pitt’s three basic aims were to raise income through taxation, stimulate trade, and to cut unnecessary government expenditure.

Pitt increased the government revenue by introducing indirect taxes and ensuring the goods taxed were the ones consumed by the rich.
Pitt introduced ingenious new taxes such as the window tax which was a form of direct tax paid by those best able to afford it, therefore it was reasonable. These increases in taxes balanced the losses in customs revenues. However it was slightly limited as owners of large properties bricked up their windows in response to this tax.
Adding tax to goods consumed by the rich was also a way Pitt aimed to increase the income.
This was a clever idea because if he taxed the poor he risked the danger of provoking a revolution which would have added to Britain’s troubles. Pitt basically introduced new taxes for the benefit of getting the government more revenue which would only have been efficient if the taxes only targeted the wealthier classes. The types of products he taxed were luxuries like hair powder, horses, gold/silver and products only the rich could afford. This policy was successful as it contributed to the fall in debt to £170milion by 1792. However it may have caused the increase in black market trade as many people brought the luxuries like hair powder into Britain to sell to the rich illegally so they could avoid paying the
tax.
Overall, the taxation policy adopted by Pitt was successful, with tax collected on some items doubling. However, some of his policies did fail, like shop tax and coal tax which caused resistance and forced Pitt to back down. This cost the government money instead of saving money.
Pitt also reduced smuggling which was a major problem as a fifth of all imports were smuggled (possibly partly due to the tax on the rich as mentioned before) and there were high duties on things not smuggled.
Pitt intended to reduce the attractiveness and profitability of smuggling through a reduction in the duties on those goods, which were mostly illegally imported to Britain. The Commutation Act of 1784 reduced the import duty on tea, by 94%, followed by a reduction of wine, spirits and tobacco. This discouraged much of the smuggling as there was less of an incentive to smuggle with such a low taxation. In addition, the Hovering Act gave officials the right to search cargo vessels which meant that less people would take the risk to try to bring goods into Britain illegally and more people would be paying taxes of goods brought into Britain. This was extremely successful in the long term as it resulted in rising value of food and raw material imports doubling to £20million between 1783-90, and exports rising from £12.5million to
£20million.

Furthermore in 1786 Pitt introduced the Sinking Fund which was very successful in reducing the national debt. All government surpluses were to be put into the Sinking Fund to pay off the debt; by 1793 the national debt had been reduced by roughly £10million with the government raising over a £1million a year through taxation. The rate at which the debt was being reduced due to this scheme would have meant it was capable of clearing the debt all together in a short period of time, however the outbreak of war with France in 1793 meant that the national debt rose and the Sinking fund became less attractive. So although it was pretty successful in the short term and did help lower the debt between 1786-93, in the long term it was not useful at all; by 1820 it had been abandoned.
The patronage system resulted in government offices being in disorder, unbalanced and therefore highly inefficient. Sinecures were often given unnecessary post, resulting in resources not being used efficiently. Pitt tackled this problem by allowing these sinecures to lapse on death. This was successful in the long term as money was not being wasted, but the fact that Pitt waited until the sinecures died meant the affects were seen late. However, waiting until their death, although not having an immediate effect on the economy, did keep the country stable politically. If Pitt had sacked all the sinecures it would have caused many disagreements creating opposition and could have angered the King who had put the sinecures in their positions.
Furthermore many politicians had become who they were through family and relations. Instead Pitt replaced them with people who were skilled and talented in their area which not only meant that government money was being spent more efficiently, but also meant that the government itself was being run more smoothly with reliable politicians keeping the country politically stable.

However, this wasn’t the only measure taken to help Britain’s political problems. The defeat of the American war and collapse of the Fox-North coalition created great political instability.
Losing the American war of independence meant Britain lost many of its thirteen colonies but did continue to hold Canada; the future of Canada was another problem with which Pitt had to deal with. By the Constitutional Act of 1791, Canada was split into a predominantly French province of Lower Canada and a predominantly English Province of Upper Canada. This strengthened the tie between Britain and Canada, and improved Britain’s political relationship with its overseas colony.

Furthermore, Fox’s East India Bill had been defeated when his coalition was dismissed but the problem it was designed to solve still remained. Britain’s increased possessions in India made it necessary for the administration there to be supervised by the government rather than be left in the hands of the East India Company; therefore Pitt introduced his own East India bill in 1784. A Board of Control was set up, which Pitt was a member of, to supervise the directors of the East India Company. This Act had improved trading with the east and kept Britain politically on top of things, however it did not prove to be very successful as the company continued to have a huge political stake in the running of British India’s administration.

In conclusion it may be said that all of Pitt’s policies did have flaws to some extent and was unsuccessful in meeting Britain’s requirements. However, it is without argument that the national debt had been reduced and political stability had been regained. Therefore Pitt’s policies had successfully met Britain’s economic and political requirements between the years 1783-93 far more than not.