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115-695: The Douglas Navigation was a canalised section of the River Douglas or Asland, in Lancashire, England , running from its confluence with the River Ribble to Wigan . It was authorised in 1720, and some work was carried out, but the undertakers lost most of the share money speculating on the South Sea Bubble . Alexander Leigh attempted to revive it eleven years later, and opened it progressively between 1738 and 1742. Leigh began work on

230-623: A bill to the House of Commons on 10 April 1713. The bill was supported by petitions from Justices of the Peace and Gentlemen from the County palatine of Lancaster , who saw the potential for improved manufacturing and communications. Steers had proposed seven locks to negotiate the rise of 75 feet (23 m) from the mouth of the river at Hesketh Bank to Wild Mill in Wigan. Although the bill passed through

345-601: A civil engineer and surveyor who had arrived in Liverpool in 1710 to work on building the docks, surveyed the Douglas and recommended that it be made accessible to ships, enabling the transport of coal from the coalfields around Wigan down to the Ribble, and onwards to Preston. It is not clear who employed him, but it may have been Sir Roger Bradshaigh, who owned land on which coal could be mined around Wigan, and who presented

460-425: A cut to bypass the river from Gathurst to Newburgh, known as "Leigh's Cut". For whatever reason, progress was slow, and the cut was still unfinished in 1771. The main traffic was coal from Wigan, with north Lancashire limestone and Westmorland slate travelling in the opposite direction. The Leeds and Liverpool Canal had been authorised by an Act of Parliament on 19 May 1770, with the main opposition coming from

575-472: A feverish interest in investing: in South Seas primarily, but in stocks generally. One famous apocryphal story is of a company that went public in 1720 as "a company for carrying out an undertaking of great advantage, but nobody to know what it is". The price finally reached £1,000 in early August 1720, and the level of selling was such that the price started to fall, dropping back to £100 per share before

690-495: A foreign consortium, Decker £49,000, Sir Ambrose Crawley £36,791. The company had a Sub-Governor, Bateman; a Deputy Governor, Ongley; and 30 ordinary directors. In total, nine of the directors were politicians, five were members of the Sword Blade consortium, and seven more were financial magnates who had been attracted to the scheme. The company created a coat of arms with the motto A Gadibus usque ad Auroram ("from Cadiz to

805-435: A further 7.5% for a financial adviser, Manasseh Gilligan. Some company board members refused to accept the contract on these terms, and the government was obliged to reverse its decision. Despite these setbacks, the company continued, having raised £200,000 to finance the operations. In 1714 2,680 slaves were carried, and for 1716–17, 13,000 more, but the trade continued to be unprofitable. An import duty of 33 pieces of eight

920-678: A man in a duel, had travelled around Europe before settling in France. There he founded a bank, which in December 1718 became the Banque Royale, national bank of France, while Law himself was granted sweeping powers to control the economy of France, which operated largely by royal decree. Law's remarkable success was known in financial circles throughout Europe, and now came to inspire Blunt and his associates to make greater efforts to grow their own concerns. In February 1719 Craggs explained to

1035-621: A new channel, and the old channel reused by the canal. Sollom Lock can still be seen on this section, although it no longer has any gates. Some 4 miles (6.4 km) of the tidal river are in use below Tarleton Lock, and this section has been increasingly used since 2002, when the Ribble Link opened, connecting the Lancaster Canal to the River Ribble. Cannel coal , which burns with a bright yellow flame, producing little ash,

1150-594: A new company formed for the purpose, the South Sea Company, which in return would issue them shares in itself to the same nominal value. The government would make an annual payment to the Company of £568,279, equating to 6% interest plus expenses, which would then be redistributed to the shareholders as a dividend. The company was also granted a monopoly to trade with South America, a potentially lucrative enterprise, but one controlled by Spain – with which Britain

1265-555: A new cut, including two locks, from Gathurst to Wigan. Progress was slow, and it was not finished until 1780. The entire section from Newburgh to Wigan was known as the Upper Douglas Navigation. Meanwhile, work on a new canal to bypass the lower sections of the river began in 1777, and the Rufford Branch, which dropped through seven conventional locks and a tide lock to join the river near its mouth at Sollom,

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1380-463: A parallel canal called Leigh's Cut to improve the passage from Newburgh to Gathurst, but progress was slow and it was unfinished in 1771. The working life of the navigation was short, as it was bought out by the Leeds and Liverpool Canal Company in 1772, to prevent a rival scheme to build a canal from Liverpool to Wigan . The canal company could not really afford the purchase price, but needed to secure

1495-433: A parallel canal, completed in 1780, and the lower river was superseded by the Rufford Branch, opened in 1781. The navigation was not a financial success, but most of the investors had interests in coal mines, and improvements to the river enabled them to get their coal to wider markets. Leigh in particular continued to invest in the navigation until its takeover, presumably using profits from his coal interests. The navigation

1610-455: A total of £9 million was owed by the government, with no specifically allocated income to pay it off. Robert Harley and John Blunt had jointly devised a scheme to consolidate this debt in much the same way that the Bank of England had consolidated previous debts, although the Bank still held the monopoly for operating as a bank. All holders of the debt (creditors) would be required to surrender it to

1725-770: The Secretary of the Treasury , William Lowndes (who had had significant responsibility for reminting the entire debased British coinage in 1696) and John Aislabie (who represented the October Club , a group of about 200 MPs who had agreed to vote together). Harley's first concern was to find £300,000 for the next quarter's payroll for the British army operating on the Continent under the Duke of Marlborough . This funding

1840-443: The South Sea Bubble . The Bubble Act 1720 ( 6 Geo. 1 c. 18), which forbade the creation of joint-stock companies without royal charter , was promoted by the South Sea Company itself before its collapse. In Great Britain, many investors were ruined by the share-price collapse, and as a result, the national economy diminished substantially. The founders of the scheme engaged in insider trading , by using their advance knowledge of

1955-606: The Treasurer to the Navy, Hampden , who invested £25,000 of government money on his own behalf. The proposal was accepted in a slightly altered form in April 1720. Crucial in this conversion was the proportion of holders of irredeemable annuities who could be tempted to convert their securities at a high price for the new shares. (Holders of redeemable debt had effectively no other choice but to subscribe.) The South Sea Company could set

2070-585: The War of the Quadruple Alliance . The company's assets in South America were seized, at a cost claimed by the company to be £300,000. Any prospect of profit from trade, for which the company had purchased ships and had been planning its next ventures, disappeared. Events in France now came to influence the future of the company. A Scottish economist and financier, John Law , exiled after killing

2185-614: The War of the Spanish Succession and Spain and Portugal controlled most of South America. There was thus no realistic prospect that trade would take place, and as it turned out, the Company never realised any significant profit from its monopoly. However, Company stock rose greatly in value as it expanded its operations dealing in government debt, and peaked in 1720 before suddenly collapsing to little above its original flotation price. The notorious economic bubble thus created, which ruined thousands of investors, became known as

2300-542: The Act gave a boost to the South Sea Company, its shares leaping to £890 in early June. This peak encouraged people to start to sell; to counterbalance this the company's directors ordered their agents to buy, which succeeded in propping the price up at around £750. The price of the stock went up over the course of a single year from about £100 to almost £1,000 per share. Its success caused a country-wide frenzy— herd behavior —as all types of people, from peasants to lords, developed

2415-492: The Act was obtained to raise the finance, but is believed to have lost most of the money he raised by speculating on the South Sea Bubble. The bubble burst two months after the shares had been issued, and with no finance, work ground to a halt. Steers, Squire and Norris eventually ended up in court, charged with fraud. All denied any wrongdoing, with Steers describing how he had bought land, stone and timber, constructed

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2530-672: The Bank of England's monopoly. The task of the Company Secretary was to oversee trading activities; the Accountant, Grigsby, was responsible for registering and issuing stock; and the Cashier, Robert Knight, acted as Blunt's personal assistant at a salary of £200 per annum. The Treaty of Utrecht of 1713 granted Britain an Asiento de Negros lasting 30 years to supply the Spanish colonies with 4,800 slaves per year. Britain

2645-435: The Bank proposed to undertake the conversion with a payment of £5.5 million and a fixed conversion price of £170 per £100 face-value Bank stock. On 1 February, the company negotiators led by Blunt raised their offer to £4 million plus a proportion of £3.5 million depending on how much of the debt was converted. They also agreed that the interest rate would decrease after four years instead of seven, and agreed to sell on behalf of

2760-726: The Company was restructured and continued to operate for more than a century after the Bubble. The headquarters were in Threadneedle Street , at the centre of the City of London , the financial district of the capital. At the time of these events, the Bank of England was also a private company dealing in national debt, and the crash of its rival confirmed its position as banker to the British government. When in August 1710 Robert Harley

2875-485: The Douglas Navigation. However, they were chiefly concerned with protecting their water supply, and ensuring that the aqueduct to carry the canal over the navigation at Newburgh, near Parbold, would not impede the progress of fixed-masted boats. Leigh's son, Holt Leigh, had been talking to the canal committee since October 1769, to work out a solution. A branch canal would link the canal to the river upstream of

2990-569: The Fishery ) was a British joint-stock company founded in January 1711, created as a public-private partnership to consolidate and reduce the cost of the national debt . To generate income, in 1713 the company was granted a monopoly (the Asiento de Negros ) to supply African slaves to the islands in the " South Seas " and South America . When the company was created, Britain was involved in

3105-453: The House of Commons a new scheme for improving the national debt by converting the annuities issued after the 1710 lottery into South Sea stock. By Act of Parliament, the company was granted the right to issue £1,150 of new stock for every £100 per annum of annuity which was surrendered. The government would pay 5% per annum on the stock created, which would halve their annual bill. The conversion

3220-414: The House of Commons successfully, some local landowners objected, and the bill was defeated in the House of Lords . A series of pamphlets were produced in an attempt to sway local opinion, and with the support of Wigan Corporation, another bill was presented. Again there was opposition, but the bill was passed, and the canalisation of the river from its junction with the River Ribble to Miry Lane End in Wigan

3335-472: The King. Shares in the company were "sold" to politicians at the current market price; however, rather than paying for the shares, these recipients simply held the shares, with the option of selling them back to the company at any time, receiving the increase in market price. This method, as well as winning over the heads of government, the King's mistress, et al. , had the advantage of binding their interests to

3450-559: The Leeds and Liverpool Canal in 1785. Having bought Leigh's shares, the Leeds and Liverpool lost no time in ensuring that they could adequately service the Wigan coal trade. By August 1772, work had started on completing Leigh's Cut and on constructing a junction between it and their canal. This was completed in February 1774, and boats could reach Wigan from Liverpool by travelling along the new canal, then along Leigh's Cut, and finally joining

3565-474: The Spaniards are to be divested of common sense, infatuate, and given up, abandoning their own commerce, throwing away the only valuable stake they have left in the world, and in short, bent on their own ruin, we cannot suggest that they will ever, on any consideration, or for any equivalent, part with so valuable, indeed so inestimable a jewel, as the exclusive trade to their own plantations. The originators of

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3680-595: The Whigs between Walpole's faction supporting the Prince of Wales and James Stanhope 's supporting the King. Argyll and Townshend were dismissed as directors, as were surviving Tories Sir Richard Hoare and George Pitt, and King George I became governor. Four MPs remained directors, as did six people holding government financial offices. The Sword Blade Company remained bankers to the South Sea, and indeed had flourished despite

3795-400: The advantage that the tidal range at Crossens would enable boats to reach the navigation more easily, the route would be 6 miles (9.7 km) shorter, and it would offer better flood protection the land above Rufford, as there would be two channels for flood water to reach the sea. No further action was taken until 1737, when Radcliffe died. Leigh became the major shareholder for the scheme, and

3910-402: The aqueduct, and locks would link them downstream. This would sailing boats to lock up into the canal and cross over the aqueduct rather than pass beneath it. The Leeds and Liverpool would pay £500 in compensation once the work was complete. The Canal Company built the canal in sections, and the first recorded use of boats was on 25 July 1771, on the section from Newburgh to Liverpool. Water supply

4025-430: The assets of an insurance company. On 22 February 1720, John Hungerford raised the question of bubble companies in the House of Commons, and persuaded the House to set up a committee, which he chaired, to investigate. He identified a number of companies which between them sought to raise £40 million in capital. The committee investigated the companies, establishing a principle that companies should not be operating outside

4140-442: The board and replaced with businessmen. The Whigs Horatio Townshend, brother in law of Robert Walpole , and the Duke of Argyll were elected directors. The change of government led to a revival of the company's share value, which had fallen below its issue price. The previous government had failed to make the interest payments to the company for the preceding two years, owing more than £1 million. The new administration insisted that

4255-625: The bubble companies investigated were two supported by Lords Onslow and Chetwynd respectively, for insuring shipping. These were criticised heavily, and the questionable dealings of the Attorney-General and Solicitor-General in trying to obtain charters for the companies led to both being replaced. However, the schemes had the support of Walpole and Craggs , so that the larger part of the Bubble Act (which finally resulted in June 1720 from

4370-493: The channel downstream from there was made straighter and wider for about 1.5 miles (2.4 km) to where work began on the lowest lock at Croston Finney. A boat was constructed, that allowed Steers to trade on the river, and he stated that he had spent £700 on the work carried out, but that Squire had only given him £600. 1720 was the time of the South Sea Bubble , a boom in the stock exchange, and Squire had stayed in London after

4485-424: The coal pits, and the delphs, a local word for a mine or quarry, of stone and slate, the transport of which would be much easier if the river was navigable. One of the provisions of the initial Act was that there was to be a maximum tonnage rate of two shillings and six pence (12.5p), regardless of the distance covered. Around 1738 or 1739, Leigh and Holt bought some land from Lord Derby at Freckleton on The Fylde, on

4600-445: The coal trade to Ireland. Whitehaven coal was carried to Dublin, but the boats returned empty, whereas boats carrying coal from the Douglas to Lancaster and Kendal returned laded with limestone and iron, enabling the more expensive Douglas coal to compete with the cheaper Whitehaven coal. There were a number of wharfs along the navigation, but the two most important ones were at the terminal basin in Wigan, where coal from Bradshaigh's mine

4715-589: The commissioners that they should become the new undertakers for the scheme. Agreement was reached on 12 June 1731, and they were granted a further eleven years to complete the project. They asked William Palmer, who was working on improvements to the River Ouse Navigation for the Corporation of York, to make a new survey, which he duly did. His report was delivered in March 1733, and indicated that

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4830-511: The committee's investigations) was devoted to creating charters for the Royal Exchange Assurance Corporation or London Assurance Corporation. The companies were required to pay £300,000 for the privilege. The Act required that a joint stock company could be incorporated only by Act of Parliament or royal charter . The prohibition on unauthorised joint stock ventures was not repealed until 1825. The passing of

4945-566: The companies had no legal basis, while others (such as the Hollow Sword Blade Company, which acted as the South Sea Company's banker), used existing chartered companies for purposes entirely different from those designated at their creation. The York Buildings Company was set up to provide water to London, but was purchased by Case Billingsley who used it to purchase confiscated Jacobite estates in Scotland, which then formed

5060-454: The company ship. He was dismissed as a director, but the result was the beginning of Harley's fall from favour with the company. On 27 July 1714, Harley was replaced as Lord High Treasurer as a result of a disagreement that had broken out within the Tory faction in parliament. Queen Anne died on 1 August 1714; and at the election of directors in 1715 the Prince of Wales (the future King George II )

5175-512: The company's charter was issued on 10 September 1711. The government itself surrendered £0.75 million of its own debt held by different departments (at that time individual office holders were at liberty to invest government funds under their control to their own advantage before it was required for government expenditure). Harley surrendered £8,000 of debt and was appointed Governor of the new company. Blunt, Caswall and Sawbridge together surrendered £65,000, Janssen £25,000 of his own plus £250,000 from

5290-572: The company's dubious legal position. Blunt and Sawbridge remained South Sea directors, and they had been joined by Gibbon and Child. Caswall had retired as a South Sea director to concentrate on the Sword Blade business. In November 1718 Sub-Governor Bateman and Deputy Governor Shepheard both died. Leaving aside the honorary position of Governor, this left the company suddenly without its two most senior and experienced directors. They were replaced by Sir John Fellowes as Sub-Governor and Charles Joye as Deputy. In 1718 war broke out with Spain once again, in

5405-399: The company, based on that of the Bank of England, was drawn up by Blunt who was paid £3,846 for his services in setting up the company. Directors would be elected every three years and shareholders would meet twice a year. The company employed a cashier, secretary and accountant. The governor was intended as an honorary position, and was later customarily held by the monarch. The charter allowed

5520-456: The conversion price but could not diverge much from the market price of its shares. The company ultimately acquired 85% of the redeemables and 80% of the irredeemables. The company then set to talking up its stock with "the most extravagant rumours" of the value of its potential trade in the New World; this was followed by a wave of "speculating frenzy". The share price had risen from the time

5635-854: The current price. The transactions were recorded by Knight in the names of intermediaries, but no payments were received and no stock issued – indeed the company had none to issue until the conversion of debt began. The individual received an option to sell his stock back to the company at any future date at whatever market price might then apply. Shares went to the Craggs: the Elder and the Younger ; Lord Gower ; Lord Lansdowne ; and four other MPs. Lord Sunderland would gain £500 for every pound that stock rose; George I's mistress, their children and Countess Platen £120 per pound rise, Aislabie £200 per pound, Lord Stanhope £600 per pound. Others invested money, including

5750-462: The dawn", from Juvenal , Satires , 10) and rented a large house in the City of London as its headquarters. Seven sub-committees were created to handle its everyday business, the most important being the "committee for the affairs of the company". The Sword Blade company was retained as the company's banker and on the strength of its new government connections issued notes in its own right, notwithstanding

5865-408: The debt be written off, but allowed the company to issue new shares to stockholders to the value of the missed payments. At around £10 million, this now represented half the share capital issued in the entire country. In 1714 the company had 2,000 to 3,000 shareholders, more than either of its rivals. By the time of the next directors' elections in 1718 politics had changed again, with a schism within

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5980-535: The destruction of most signs of the navigation, particularly below Rufford, although the section between Rufford Lock and Sollom is preserved, having been reused when the river was diverted to the east as part of the construction of the Rufford Branch. Sollom Lock has no gates, but its walls are still intact. River Douglas, Lancashire Too Many Requests If you report this error to the Wikimedia System Administrators, please include

6095-399: The details below. Request from 172.68.168.133 via cp1102 cp1102, Varnish XID 571512358 Upstream caches: cp1102 int Error: 429, Too Many Requests at Thu, 28 Nov 2024 07:50:21 GMT South Sea Company The South Sea Company (officially: The Governor and Company of the merchants of Great Britain, trading to the South Seas and other parts of America and for the encouragement of

6210-496: The expected profits into four, allocated themselves one portion each, and split the remaining portion in 1,200 parts, which they hoped to sell for £5 each. This would in theory raise £6,000, but it is unclear how many shares were actually sold, though it was at least 942, which would have raised £4,170. Steers began work, replacing the ford at Rufford with a bridge and building the first lock using stone from quarries at Harrock Hill and Bartons Delf, both locations fairly close to Rufford.

6325-540: The extension, the river was diverted into a new channel further to the east between Rufford and Tarleton Bridge, and the old channel was re-used by the canal. From that time, only the lower portion of the river, from Tarleton to the confluence with the Ribble remained in use. Because Edward Holt had retained his two shares, the Leeds and Liverpool Canal accounted for the Upper and Lower Douglas Navigation sections separately to

6440-571: The first year, plus any that might have been added (against standing instructions) by the ship's captains on their own behalf. On arrival of the first cargoes, the local authorities refused to accept the Asiento, which had still not been officially confirmed there by the Spanish authorities. The slaves were eventually sold at a loss in the West Indies. In 1714 the government announced that a quarter of profits would be reserved for Queen Anne and

6555-471: The form of a fixed annuity over a period of years, so that the government effectively held the prize money as borrowings until the whole value had been paid out to the winners. Marketing was handled by members of the Sword Blade syndicate, Gibbon selling £200,000 of tickets and earning £4,500 commission, and Blunt selling £993,000. Charles Blunt (a relative) was made Paymaster of the lottery with expenses of £5,000. The national debt investigation concluded that

6670-402: The founders of the Bank of England and of the financially disastrous Darien Scheme . Harley was rewarded for delivering the scheme by being created Earl of Oxford on 23 May 1711 and was promoted to Lord High Treasurer . With a more secure position, he began secret peace negotiations with France. The scheme to thus consolidate all government debt and to manage it better in the future held out

6785-592: The full court of directors to nominate a smaller committee to act on any matter on its behalf. Directors of the Bank of England and of the East India Company were barred from being directors of the South Sea Company. Any ship of more than 500 tons owned by the company was to have a Church of England clergyman on board. The surrender of government debt for company stock was to occur in five separate lots. The first two of these, totaling £2.75 million from about 200 large investors, had already been arranged before

6900-475: The government was to be used to buy in any debt not subscribed to the scheme, which although it helped the government, also helped the company by removing possibly competing securities from the market, including large holdings by the Bank of England. Company stock was now trading at £123, so the issue amounted to an injection of £5 million of new money into a booming economy just as interest rates were falling. Gross Domestic Product (GDP) for Britain at this point

7015-462: The government £1 million of Exchequer bills (formerly handled by the Bank). The House accepted the South Sea offer. Bank stock fell sharply. Perhaps the first sign of difficulty came when the South Sea Company announced that its Christmas 1719 dividend would be deferred for 12 months. The company now embarked on a show of gratitude to its friends. Select individuals were sold a parcel of company stock at

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7130-666: The interests of the company: in order to secure profits, the stock needed to rise. Meanwhile, by publicising the names of their elite stockholders, the company managed to clothe itself in an aura of legitimacy, which attracted and kept other buyers. The South Sea Company was by no means the only company seeking to raise money from investors in 1720. A large number of other joint-stock companies, making extravagant (sometimes fraudulent) claims about foreign or other ventures or bizarre schemes, had been created. Others represented potentially sound, although novel, schemes, such as for founding insurance companies. These were nicknamed "Bubbles". Some of

7245-564: The lock, and been carrying goods along a 5-mile (8 km) section of the river. The case rumbled on from 1729 to 1734, with Squire disappearing around 1730, but the Court of Chancery failed to reach a conclusion as to whether the men had deliberately set out to defraud shareholders of their money. Although the landowners had originally resisted the scheme, and the eleven years to complete it had passed, in 1731 Alexander Leigh of Hindley Hall , Wigan and Alexander Radcliffe of Ormskirk negotiated with

7360-426: The main canal, so that profits could be apportioned appropriately. This situation continued until 1893, when they were finally able to buy the remaining two shares from Holt's descendants. Thus, although trade on the river had only lasted for a little over forty years, the company lasted on paper for 173 years. Both the original bill presented to Parliament in 1713 nnd the second attempt in 1720 were supported by noting

7475-489: The national finances, which were suffering from the pressures of two simultaneous wars : the War of the Spanish Succession with France, which ended in 1713, and the Great Northern War , which was not to end until 1721. Harley came prepared, with detailed accounts describing the situation of the national debt, which was customarily a piecemeal arrangement, with each government department borrowing independently as

7590-406: The navigation being possible on more days each month. Man power was used to tow the boats, but in 1800 land for a towpath between Sollom and Rufford was bought. Plans to make the whole length navigable by fixed-mast boats were dropped when the Leeds and Liverpool Canal became interested in the navigation. Improvements to the river below Gathurst Bridge had begun in 1753, when Leigh started working on

7705-448: The navigation had fixed bridges, sailing boats needed to be able to lower their masts, and this prevented sea-going boats, called flats, from using the navigation, as they required the extra rigidity of a fixed mast. In the early 1760s, a new cut was built between Sollom and Rufford, and fixed bridges began to be replaced by swing bridges. A new lock at Sollom was a little further downstream than that at Crostons Finney, resulting in access to

7820-412: The navigation were some £12,385, which had risen to £32,226 by 1768, by the time interest and maintenance charges were included. Thus the navigation was not profitable as a business, but most of the investors had coal to sell, and the river enabled them to do that. Leigh continued to invest in the navigation throughout his ownership, and this was probably as a result of his trading activities in coal. Once

7935-567: The need arose. He released the information steadily, continually adding new reports of debts incurred and scandalous expenditure, until in January 1711 the House of Commons agreed to appoint a committee to investigate the entire debt. The committee included Harley himself, the two Auditors of the Imprests (whose task was to investigate government spending), Edward Harley (the Chancellor's brother), Paul Foley (the Chancellor's brother-in-law),

8050-498: The new cuts were completed as part of the Leeds and Liverpool Canal takeover, coal traffic increased steadily, although the river was still used for a while, as mineowners did not immediately build new wharfs on the new canal. The tonnage rates on the canal were reduced, and the changeover speeded up by raising tonnage rates on the river. The separate accounts for the Douglas Navigation kept by the canal company show that revenue rose from £162 in 1772 to £1,790 in 1778, and that this revenue

8165-468: The north bank of the Ribble opposite the mouth of the Douglas. The first traffic carried by the navigation was coal from Lord Derby's mine at Bispham to Freckleton. Sir Roger Bradshaigh worked in Parliament in 1739 to defeat a bill by Sir James Lowther to reduce the duty on coal carried around the coast. Lowther owned large collieries at Whitehaven, and if the bill had succeeded, he would have monopolised

8280-476: The objects specified in their charters. A potential embarrassment for the South Sea was avoided when the question of the Hollow Sword Blade Company arose. Difficulty was avoided by flooding the committee with MPs who were supporters of the South Sea, and voting down by 75 to 25 the proposal to investigate the Hollow Sword. (At this time, committees of the House were either 'Open' or 'secret'. A secret committee

8395-556: The offer to the public in July 1719. The Sword Blade company spread a rumour that the Pretender had been captured, and the general euphoria induced the South Sea share price to rise from £100, where it had been in the spring, to £114. Annuitants were still paid out at the same money value of shares, the company keeping the profit from the rise in value before issuing. About two-thirds of the in-force annuities were exchanged. The 1719 scheme

8510-481: The open market at a price that allowed anyone with advance knowledge to buy and resell in the immediate future at a high profit, for as soon as the scheme became publicised the bonds would once again be worth at least their nominal value, as repayment was now more certain a prospect. This anticipation of gain made it possible for Harley to bring further financial supporters into the scheme, such as James Bateman and Theodore Janssen . Daniel Defoe commented: Unless

8625-406: The project completed, but an inspection was made by the commissioners on 12 June 1742, eleven years to the day since Leigh took over, The navigation was declared to be complete. An estimated £7,000 had been spent on this second phase of work, and another £1,000 on a fleet of boats. Canalisation of the river involved the construction of a number of locks, with a basin at Miry Lane End, in Wigan, which

8740-414: The prospect of all existing creditors being repaid the full nominal value of their loans, which at the time before the scheme was publicised were valued at a discounted rate of £55 per £100 nominal value, as the lotteries were discredited and the government's ability to repay in full was widely doubted. Thus bonds representing the debt intended to be consolidated under the scheme were available for purchase on

8855-481: The river at Dean Lock for the final 3 miles (4.8 km) into Wigan. Various repairs to the navigation were made in time for a formal opening in October 1774. Alexander Leigh died shortly afterwards, and the Leeds and Liverpool rented the remaining shares in the navigation from Holt Leigh, who was administering his estate. There were calls to bypass the river sections of the old navigation entirely, and work started on

8970-496: The river navigation was effectively abandoned. The lock gates on the river sections had been removed by 1782, and it was completely unused by 1801, although the wharf at Gathurst remained accessible by a side lock at Dean, and the side lock was still shown with gates on the 1928 Ordnance Survey map. In 1805, Sollom lock on the Rufford branch was abandoned, and a new tide lock was built further downstream at Tarleton . In order to build

9085-407: The same amount to the company for all the fixed-term repayable debt as it had been paying before, but after seven years the 5% interest rate would fall to 4% on both the new annuity debt and also that assumed previously. After the first year, the company was to give the government £3 million in four quarterly installments. New stock would be created at a face value equal to the debt, but the share price

9200-453: The scheme knew that there was no money to invest in a trading venture, and no realistic expectation that there would ever be a trade to exploit, but nevertheless the potential for great wealth was widely publicised at every opportunity, so as to encourage interest in the scheme. The objective for the founders was to create a company that they could use to become wealthy and that offered scope for further government deals. The royal charter for

9315-406: The scheme was proposed: from £128 in January 1720, to £175 in February, £330 in March and, following the scheme's acceptance, £550 at the end of May. What may have supported the company's high multiples (its P/E ratio ) was a fund of credit (known to the market) of £70 million available for commercial expansion which had been made available through substantial support, apparently, by Parliament and

9430-504: The start of the contract. The Asiento was granted in the name of Queen Anne and then contracted to the company. By July the company had arranged contracts with the Royal African Company to supply the necessary African slaves to Jamaica. Ten pounds was paid for a slave aged over 16, £8 for one under 16 but over 10. Two-thirds were to be male, and 90% adult. The company trans-shipped 1,230 slaves from Jamaica to America in

9545-560: The tidal River Douglas to reach the River Ribble. Asland Lamp is located in the Ribble, and boats heading upstream to the Ribble Link must keep it on the starboard side, to avoid an area of shallow water, which can be treacherous when the tides are running fast. Despite having been abandoned for 200 years, traces of the navigation can still be seen between Parbold and Gathurst, which include the remains of several locks. The river has been altered to improve drainage, and this has resulted in

9660-485: The timings of national debt consolidations to make large profits from purchasing debt in advance. Huge bribes were given to politicians to support the Acts of Parliament necessary for the scheme. Company money was used to deal in its own shares, and selected individuals purchasing shares were given cash loans backed by those same shares to spend on purchasing more shares. The expectation of profits from trade with South America

9775-412: The water supply to prevent the rival scheme from using it. The Leeds and Liverpool completed Leigh's Cut, built locks to enable sailing boats on the river to avoid having to pass under the aqueduct which carried the canal over the river at Newburgh, and improved the upper river into Wigan in time for a formal opening in October 1774. The final 3 miles (4.8 km) of river section into Wigan was replaced by

9890-568: The work would cost £6,685, and would require 12 locks. The total rise was 68 feet (21 m), each lock would be 60 by 12 feet (18.3 by 3.7 m), and the depth of the navigation would be 3 feet (0.91 m). He identified a problem with the original plans, as the tide lock would not accessible except for a couple of days either side of spring tides. He therefore proposed creating a new cut from Rufford to Crossens, near Southport, crossing Martin Mere. This additional work would cost £2,530, but would have

10005-447: The year was out. This triggered bankruptcies amongst those who had bought on credit, and increased sales, including short selling (i.e., selling borrowed shares in the hope of buying them back at a profit if the price fell). Also, in August 1720, the first of the installment payments of the first and second money subscriptions on new issues of South Sea stock were due. Earlier in the year John Blunt had come up with an idea to prop up

10120-557: Was a distinct success from the government's perspective, and they sought to repeat it. Negotiations took place between Aislabie and Craggs for the government and Blunt, Cashier Knight and his assistant and Caswell. Janssen, the Sub Governor and Deputy Governor were also consulted but negotiations remained secret from most of the company. News from France was of fortunes being made investing in Law's bank, whose shares had risen sharply. Money

10235-562: Was a problem, as the act of Parliament prohibited extraction from the River Douglas. At the time, Alexander Leigh held 29 of the 36 shares in the navigation, and offered to sell them for £14,500 to the Leeds and Liverpool in November 1771. Although they could not really afford the price, they bought them anyway, as they were fighting a new scheme for a Liverpool Canal, which would have connected directly to Wigan. The Liverpool Canal bill

10350-458: Was a significant part of the company's work, and that it was carried out to the standards of the day. Its trading activities therefore offered a financial motivation for investment in the company. The company was heavily dependent on the goodwill of government; when the government changed, so too did the company board. In 1714 one of the directors who had been sponsored by Harley, Arthur Moore, had attempted to send 60 tons of private goods on board

10465-407: Was abandoned by 1801, but because the canal company had not been able to buy all the original shares, the new cuts were known as the Upper and Lower Douglas Navigations, and were accounted for separately, until the final two shares were purchased in 1893. Thus on paper the Douglas Navigation lasted for 173 years, and a small part of it remains, as to build the Rufford Branch, the river was diverted into

10580-477: Was an unofficial bank. Sales commenced on 3 March 1711 and tickets had completely sold out by 7 March, making it the first truly successful English state lottery. The success was shortly followed by another larger lottery, "The Two Million Adventure" or "The Classis", with tickets costing £100, with a top prize of £20,000 and every ticket winning a prize of at least £10. Although prizes were advertised by their total value, they were in fact paid out by installments in

10695-499: Was appointed Chancellor of the Exchequer , the government had already become reliant on the Bank of England , a privately owned company chartered 16 years previously, which had obtained a monopoly as the lender to the government. The government had become dissatisfied with the service it was receiving and Harley was actively seeking new ways to improve the national finances. A new parliament met in November 1710 resolved to attend to

10810-415: Was at war. At that time, when the continent of America was being explored and colonized, Europeans applied the term "South Seas" only to South America and surrounding waters. The concession both held out the potential for future profits and encouraged a desire for an end to the war, necessary if any profits were to be made. The original suggestion for the South Sea scheme came from William Paterson , one of

10925-481: Was authorised by Parliament on 7 April 1720, with Steers and William Squire, Esq. of Liverpool as the two proprietors. They were given 11 years to complete the work, and could charge tolls on all goods carried, except for manure, which could not be charged. Commissioners were appointed, who could engage new proprietors if Steers and Squire failed to finish the task. In order to fund the scheme, Steers and Squire, assisted by Squire's brother-in-law Richard Norris, divided

11040-490: Was being mined in the Wigan coalfield, and there was an increasing market for coal around the edges of the Irish Sea, but the industry was hampered by the lack of an efficient way to transport the coal to the coast. The roads were primitive, but the River Douglas ran from Wigan to the River Ribble below Tarleton, and in the early 18th century, there was growing interest in making it into a navigation. In 1712, Thomas Steers ,

11155-478: Was charged on each slave (although for this purpose some slaves might be counted only as a fraction of a slave, depending on quality). One of the extra trade ships was sent to Cartagena in 1714 carrying woollen goods, despite warnings that there was no market for them there, and they remained unsold for two years. It has been estimated that the company transported a little over 34,000 slaves with mortality losses comparable to its competitors, showing that slave trading

11270-482: Was completed in October 1781. This was known as the Lower Douglas Navigation. All that remained to be done was to tidy up the legal details. The Leeds and Liverpool obtained another act of Parliament on 24 June 1783, which allowed them to purchase most of the remaining shares, but did not authorise the original purchase retrospectively. Once the canal was opened, all trade was transferred to it, and

11385-421: Was connected to the river by a short artificial channel. Hadfield states that there were eight locks, all of which were upstream of Newburgh. Clarke, however, lists thirteen, eight of which were above Newburgh, with five more below it. To improve access to the navigation, a new lock was constructed further downstream at Tarleton, but there were complaints that it caused flooding, and it had been abandoned by 1770. As

11500-486: Was elected as Governor of the company. The new King George I and the Prince of Wales both had large holdings in the company, as did some prominent Whig politicians, including James Craggs the Elder , the Earl of Halifax and Sir Joseph Jekyll. James Craggs, as Postmaster General, was responsible for intercepting mail on behalf of the government to obtain political and financial information. All Tory politicians were removed from

11615-485: Was estimated as £64.4 million. On 21 January the plan was presented to the board of the South Sea Company, and on 22 January Chancellor of the Exchequer John Aislabie presented it to Parliament. The House was stunned into silence, but on recovering proposed that the Bank of England should be invited to make a better offer. In response, the South Sea increased its cash payment to £3.5 million, while

11730-501: Was joined by Robert Holt of Wigan. The two men set to work, and opened four locks in 1738, and another three in 1739. In 1738, the commissioners made a contract with a colliery owner to deliver 800,000 baskets of coal. Holt and Leigh consulted Steers occasionally, paying him for advice on the basin in Wigan and Crooke Lock. The main contractor was Richard Fell, who was paid for all sorts of work, while other contractors were engaged for specific tasks. Holt died in 1740 and did not live to see

11845-455: Was just under one quarter of the total revenue raised by the canal company. With the decline in commercial trade on the canal system, even the final river section became little used, with most pleasure craft venturing only as far as Tarleton Lock, and it was not until 2002, with the opening of the Ribble Link that this section of the navigation began to see any appreciable traffic. Below Tarleton Lock, boats must navigate 4 miles (6.4 km) of

11960-503: Was loaded, and at Gathurst, serving coal mines at Orrell. It appears that boats used on the navigation were between 45 and 55 feet (14 and 17 m) long, were less than 14.5 feet (4.4 m) wide, and had a draught of a little under 5 feet (1.5 m). Few records of what was carried exist, but a boat named Expedition carried coal, cannel, cinders (coke) turn and paving stones downriver, and returned with timber, hides, kelp, soap ashes, barley, beans, and most importantly limestone, which

12075-518: Was moving around Europe, and other flotations threatened to soak up available capital (two insurance schemes in December 1719 each sought to raise £3 million). Plans were made for a new scheme to take over most of the unconsolidated national debt of Britain (£30,981,712) in exchange for company shares. Annuities were valued as a lump sum necessary to produce the annual income over the original term at an assumed interest of 5%, which favoured those with shorter terms still to run. The government agreed to pay

12190-493: Was much harder to sell and transfer of its ownership was legally much more complex. The government received a cash payment and lower overall interest on the debt. Importantly, it also gained control over when the debt had to be repaid, which was not before seven years but then at its discretion. This avoided the risk that debt might become repayable at some future point just when the government needed to borrow more, and could be forced into paying higher interest rates. The payment to

12305-471: Was one with a fixed set of members who could vote on its proceedings. By contrast, any MP could join in with an 'open' committee and vote on its proceedings.) Stanhope, who was a member of the committee, received £50,000 of the 'resaleable' South Sea stock from Sawbridge, a director of the Hollow Sword, at about this time. Hungerford had previously been expelled from the Commons for accepting a bribe. Amongst

12420-574: Was permitted to open offices in Buenos Aires , Caracas , Cartagena , Havana , Panama , Portobello and Vera Cruz to arrange the Atlantic slave trade . One ship of no more than 500 tons could be sent to one of these places each year (the Navío de Permiso ) with general trade goods. One quarter of the profits were to be reserved for the King of Spain. There was provision for two extra sailings at

12535-405: Was presented to Parliament in January 1772, but was defeated. Alexander Leigh's 29 shares were initially bought by two committee members, Jonathan Blundell and William Earle, both from Liverpool, and held in trust on behalf of the proprietors. Holt Leigh succeeded in buying most of the remaining shares, apart from two owned by his uncle Edward Holt, in the following year, and eventually sold them to

12650-528: Was provided by a private consortium of Edward Gibbon (grandfather of the historian ), George Caswall , and Hoare's Bank . The Bank of England had been operating a lottery on behalf of the government, but in 1710 this had produced less revenue than expected and another begun in 1711 was also performing poorly; Harley granted the authority to sell tickets to John Blunt , a director of the Hollow Sword Blade Company , which despite its name

12765-418: Was still rising and sales of the remaining stock, i.e. the excess of the total market value of the stock over the amount of the debt, would be used to raise the government fee plus a profit for the company. The more the price rose in advance of conversion, the more the company would make. Before the scheme, payments were costing the government £1.5 million per year. In summary, the total government debt in 1719

12880-488: Was talked up to encourage the public to purchase shares, but the bubble prices reached far beyond what the actual profits of the business (namely the slave trade) could justify. A parliamentary inquiry was held after the bursting of the bubble to discover its causes. A number of politicians were disgraced, and people found to have profited immorally from the company had personal assets confiscated proportionate to their gains (most had already been rich and remained so). Finally,

12995-457: Was the major return cargo. These records are for the years 1752 to 1755, while records dating from 1764 to 1768 for another boat called Success indicate that downriver traffic was mainly coal, with some cinders, paving stones and slates, while upriver traffic was exclusively limestone. Holt Leigh's diaries indicate that tolls for 1772 were £414, which would suggest that over 10,000 tons of goods were carried that year. Total costs for construction of

13110-544: Was voluntary, amounting to £2.5 million new stock if all converted. The company was to make an additional new loan to the government pro rata up to £750,000, again at 5%. In March there was an abortive attempt to restore the Old Pretender, James Edward Stuart , to the throne of Britain, with a small landing of troops in Scotland. They were defeated at the Battle of Glen Shiel on 10 June. The South Sea company presented

13225-414: Was £50 million: The purpose of this conversion was similar to the old one: debt holders and annuitants might receive less return in total, but an illiquid investment was transformed into shares that could be readily traded. Shares backed by national debt were considered a safe investment and a convenient way to hold and move money, far easier and safer than metal coins. The only alternative safe asset, land,

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