Finance

Question 1

How were Pitt’s reforms seen by many people? Why?

Answer 1

Popular

Fighting the “old corruption”

Question 2

What had Britain become?

Answer 2

In the hundreds of years before Pitt, Britain had become a fiscal-military state

Question 3

What was a fiscal-military state?

Answer 3

Meant taxes had increased and the military was growing rapidly

Question 4

How had the government been seen before Pitt?

Answer 4

The systems were inefficient and it had became associated with corruption

Question 5

How did national debt work to benefit the rich?

Answer 5

Was mostly borrowed from wealthy aristocrats who made a large amount of interest

Question 6

What was national debt at in 1784?

Answer 6

243 million

Question 7

What caused the government to have a national debt of 243 million? How much was this compared to what the government earned?

Answer 7

Caused by the American War of Independence

20 times what the government earned

Question 8

When did Pitt add to the debt?

Answer 8

1793

Question 9

How was the sinking fund a good thing?

Answer 9

In peacetime, the sinking fund allowed Pitt to reduce national debt.

Question 10

How was the sinking fund negative?

Answer 10

In wartime, between 1793 and 1815 as the cost of bonds was much higher and so was the interest paid on them. The government made hardly any money. The money put into the sinking fund could have been used more effectively elsewhere.

Question 11

When was the sinking fund introduced?

Answer 11

1786

Not a new idea but had not been used for more than 40 years

Question 12

What had happened by 1793?

Answer 12

Pitt had wiped 10 million off the national debt

Question 13

After how long could Pitt have paid off national debt according to calculations?

Answer 13

45 years

Question 14

When was the tax on retail shops passed?

Answer 14

1785

Question 15

What did the retail tax do?

Answer 15

Taxed shops based on their annual earnings

Question 16

What did the tax on retail shops lead to?

Answer 16

Riots after prices rose and so it was stopped

Question 17

When was the hugely unpopular retail tax stopped?

Answer 17

1789

Question 18

What did Pitt do to the number of sinecures?

Answer 18

Reduced them

Question 19

How did Pitt reduce the number of sinecures?

Answer 19

Slowly waited for the people who held them to die

Question 20

How was the reduction of sinecures good for Pitt?

Answer 20

Although it was a slow process, the people who held sinecures had been given them to support Pitt, so they may have turned against him

Question 21

What did Pitt do to government jobs?

Answer 21

Reduced them to increase efficiency

Question 22

What was the policy of reducing jobs called?

Answer 22

Retrenchment

Question 23

What did retrenchment do?

Answer 23

Saved a lot of money

Question 24

How many excise officers jobs’ were cut?

Answer 24

750 by the early 1790s

Question 25

What did Pitt do to the pay of the remaining excise officers?

Answer 25

Increased it in the hope it would encourage them to be less corrupt

Question 26

What did Pitt do to save money on government contracts?

Answer 26

Gave contracts to the best company rather than who supported the government which saved the government money as the price became more important than connections

Question 27

What did a committee recommend to Pitt about his changes?

Answer 27

In 1789 a committee recommended he went further with his changes to increase efficiency however Pitt ignored these because he was afraid of offending wealthy, influential people

Question 28

What else was responsible for an increase in income?

Answer 28

Between 1784 and 1793 there was an increase in trade and economic activity