EXCHEQUER. The word “exchequer” is the English form of the Fr. échiquier, low Lat. scaccarium, and its primary meaning is a chess-board (see Chess). As the name of a government department dealing with accounts it is derived from the exchequer or the “abacus” by means of which such accounts were kept, such a contrivance being almost universally in use before the introduction of the Arabic notation. In England the department or court of accounts was named originally “the tallies” from the notched sticks or tallies which constituted the primitive means of account-keeping (which were only abolished in 1826), and was only subsequently, probably in the reign of Henry I., named the exchequer from the use of the abacus. Both the name and the general features of the institution may reasonably be attributed to Norman influence, since we find both in Normandy and in the Norman kingdom of Sicily, as well as in Scotland and Ireland; the two latter cases being directly due to English example. As a court of law the exchequer owed its existence in England, as elsewhere, to the necessity of deciding legal questions arising from matters of account, and its secondary activities soon overshadowed its original functions.
We cannot say whether the exchequer, as known in England, is older than the beginning of the 12th century. The treasury, which may be regarded as one of its constituents, dates from before the conquest, and the officers of the exchequer who were drawn from the treasury staff can be traced back to Domesday. But our earliest information about the exchequer itself, apart from that afforded by the pipe rolls (see Record), rests on a treatise (Dialogus de Scaccario) written about A.D. 1179 by Richard, bishop of London and treasurer of England. His father, Nigel, bishop of Ely, had been treasurer of Henry I., and nephew to that king’s great financial minister Roger, bishop of Salisbury. Nigel is said to have reconstituted the exchequer after the troubles of Stephen’s reign upon the model which he inherited from his uncle. The Angevin, or rather the Norman, exchequer cannot be regarded in strictness as a permanent department. It consisted of two parts: the lower exchequer, which was closely connected with the permanent treasury and was an office for the receipt and payment of money; and the upper exchequer, which was a court sitting twice a year to settle accounts and thus nearly related to the Curia Regis (q.v.). We dare hardly say that either exchequer existed in vacation; indeed the word (like the word “diet”) seems to have been limited at first to the actual sitting of the king’s court for financial purposes. The Michaelmas and Easter exchequers were the sessions of this court “at the exchequer” or chess-board as it had previously sat “at the tallies.” The constitution of the court was that of the normal Frankish curia. The king was the nominal president, and the court consisted of his great officers of state and his barons, or tenants-in-chief, and it is doubtless due to the fact that the exchequer was originally the curia itself sitting for a special purpose that its unofficial judges retained the name of “barons” until recent times. Of the great officers we may probably find the steward in the person of the justiciar, the normal president of the court. He sat at the head of the exchequer table. The butler was not represented. The chancellor sat on the justiciar’s left; he was custodian ex officio of the seal of the court, and thus responsible for the issue of all writs and summonses, and moreover for the keeping of a duplicate roll of accounts embodying the judgments of the court. On the left of the chancellor, and thus clear of the table, since their services might be required elsewhere at any moment, sat the constable, the two chamberlains and the marshal. The constable was the chief of the outdoor service of the court, and was responsible for everything connected with the army, or with hunting and hawking. The two chamberlains were the lay colleagues of the treasurer, and shared with him the duty of receiving and paying money, and keeping safe the seal of the court, and all the records and other contents of the treasury. The marshal, who was subordinate to the constable, shared his duties, and was specially responsible for the custody of prisoners and of the vouchers produced by accountants. At the head of the table on the justiciar’s right sat, in Henry II.’s time, an extraordinary member of the court, the bishop of Winchester. The treasurer, like the chancellor a clerk, sat at the head of the right-hand side of the table. He charged the accountants with their fixed debts, and dictated the contents of the great roll of accounts (or pipe roll) which embodied the decisions of the court as to the indebtedness of the sheriffs and other accountants. These persons with certain subordinates constituted the court of accounts, or upper exchequer, whereas the lower exchequer, or exchequer of receipt, consisted almost exclusively of the subordinates of the treasurer and chamberlains. In the upper exchequer the justiciar appointed the calculator, who exhibited the state of each account by means of counters on the exchequer table, so that the proceedings of the court might be clear to the presumably illiterate sheriff. The calculator sat in the centre of the side of the table on the president’s left. The chancellor’s staff consisted of the Magister Scriptorii (probably the ancestor of the modern master of the rolls), whose duties are not stated; a clerk (the modern chancellor of the exchequer) who settled the form of all writs and summonses, charged the sheriff with all fines and amercements, and acted as a check on the treasurer in the composition of the great roll; and a scribe (afterwards the comptroller of the pipe), who wrote out the writs and summonses and kept a duplicate of the great roll, known as the chancellor’s roll. The constable’s subordinates were the marshal and a clerk, who, besides the duty of paying outdoor servants of the crown, had the special task of producing duplicates of all writs issued by the Curia Regis. The treasurer and chamberlains, being colleagues, had a joint staff, the clerical or literate members of which were servants of the treasurer, while the lay or illiterate members depended on the chamberlains. Hence while the treasurer and his clerks kept their accounts by means of rolls, the chamberlains and their serjeants duplicated them so far as possible by means of tallies. Thus the great roll was written by the treasurer’s scribe (the engrosser, afterwards the clerk of the pipe), while the payments on account and other allowances to be credited to the sheriff were registered by the tally cutter of the chamberlains.
In the exchequer of receipt the staff was similarly divided between the treasurer and chamberlains; the treasurer having a clerk who kept the issue and receipt rolls (the later clerk of the pells) and four tellers, while each of the chamberlains was represented by a knight (afterwards the deputy chamberlains), who controlled the clerk’s account by means of tallies, and held their lands by this serjeanty; these three had joint control of the treasury, and could not act independently. The other serjeants were the knight or “pesour” who weighed the money, the melter who assayed it, and the ushers of the two exchequers. It should be noted that all the lay offices of the treasury in both exchequers were hereditary. Henry II. had also a personal clerk who supervised the proceedings personally in the upper, and by deputy in the lower, exchequer.
The business of the ancient exchequer was primarily financial, although we know that some judicial business was done there and that the court of common pleas was derived from it rather than from the curia proper. The principal accountants were the sheriffs, who were bound, as the king’s principal financial agents in each county, to give an account of their stewardship twice a year, at the exchequers of Easter and Michaelmas. Half the annual revenue was payable at Easter, and at Michaelmas the balance was exacted, and the accounts made up for the year, and formally enrolled on the pipe roll. The fixed revenue consisted of the farms of the king’s demesne lands within the counties, of the county mints, and of certain boroughs (see Borough) which paid annual sums as the price of their liberties. Danegeld was also regarded as fixed revenue, though after the accession of Henry II. it was not frequently levied. There were also rents of assarts and purprestures and mining and other royalties. The casual revenue consisted of the profits of the feudal incidents (escheat, wardship and marriage), of the profits of justice (amercements, and goods of felons and outlaws), and of fines, or payments made by the king’s subjects to secure grants of land, wardships or marriages, and of immunities, as well as for the hastening and sometimes the delaying of justice. Besides this, there were the revenues arising from aids and scutages of the king’s military tenants, tallages of the crown lands, customs of ports, and special “gifts,” or general assessments made on particular occasions. For the collection of all these the sheriff was primarily responsible, though in some cases the accountants dealt directly with the exchequer, and were bound to make their appearance in person on the day when the sheriff accounted.
We gather both from tradition and from the example of the Scottish exchequer that the farms of demesne lands were originally paid in kind, by way of purveyance for the royal household, and although such farms are expressed even in Domesday Book in terms of money, the tradition that there was a system of customary valuation is a sufficient explanation, and not of itself incredible. At some date, possibly under the administration of Roger of Salisbury, the inconvenience of this arrangement led to the substitution of money payments at the exchequer. The rapid deterioration of a small silver coinage led to successive efforts to maintain the value of these payments, first by a “scale” deduction of 6d. in the £ for wear, then by the substitution of payment by weight for payment by tale, and finally by the reduction of most of such payments to their pure silver value by means of an assay, a process originally confined to payments from particular manors. Only the farms of counties, however, were so treated, and not all of those. The amount to be deducted in these cases was settled by the weighing and assaying of a specimen pound of silver in the presence of the sheriff by the pesour and the melter in the lower exchequer. The casual revenue was paid by tale, and for the determination of its amount it was necessary to have copies of all grants made in the chancery on which rents were reserved, or fines payable. These were known first as contrabrevia and later as originalia; the profits of justice were settled by the delivery of “estreats” from the justices, while for certain minor casualties the oath of the sheriff was at first the only security. At a later date many of them were determined by copies of inquisitions sent in from the chancery. All this business might be transacted anywhere in England, and though convenience placed the exchequer first at Winchester (where the treasury was), and afterwards usually at Westminster, it held occasional sessions at other towns even in the 14th century.
The Angevin exchequer, described by Richard the Treasurer, remained the ideal of the institution throughout its history, and the lineaments of the original exemplar were never completely effaced; but the rapid increase both of financial and judicial business led to a multiplication of machinery and a growing complexity of constitution. Even in the time of Henry II. we gather that the great officers of state, except the treasurer and chancellor, commonly attended by deputy. In the reign of Henry III. the chancellor had also ceased to attend, and his clerk acquired the title of chancellor of the exchequer. To the same period belongs the institution of the king’s and lord treasurer’s remembrancers. These at first had common duties and kept duplicate rolls, but by the ordinance of 1323 their functions were differentiated. Henceforward the king’s remembrancer was more particularly concerned with the casual, and the lord treasurer’s remembrancer with the fixed revenue. The former put all debts in charge, while the latter saw to their recovery when they had found their way on to the great roll. Hence the preliminary stages of each account, the receiving and registering of the king’s writs to the treasurer and barons, and the drawing up of all particulars of account, lay with the king’s remembrancer, and he retained the corresponding vouchers. The lord treasurer’s remembrancer exacted the “remanets” of such accounts as had been enrolled, as well as reserved rents and fixed revenue, and so became closely connected with the clerk of the pipe. Before the end of the 14th century these three offices had already crystallized into separate departments.
In the meantime the increasing length and variety of accounts, as well as the growth of judicial business, had led to various efforts at reform. As early as 22 Henry II. it became necessary to remove from the great roll the debts which it seemed hopeless to levy, and further ordinances to the same end were made by statute in 54 Henry III. and in 12 Edward I. By this last a special “exannual roll” was established in which the “desperate debts” were recorded, in order that the sheriff might be reminded of them yearly without their overloading the great roll. But the largest accession of financial business arose from the “foreign accounts,” that is to say, the accounts of national services, which did not naturally form part of the account of any county. These did not in the reign of Henry II. form a part of the exchequer business. Such expenses as appear on the pipe roll were paid by the sheriffs, or by the bailiffs of “honours”; payments out of the treasury itself would only appear on the receipt and issue rolls, and the “spending departments” probably drew their supplies from the camera curie, and not directly from the exchequer. In the course of the 13th century the exchequer gradually acquired partial control of these national accounts. Even in 18 Henry II. there is an account for the forests of England, and soon the mint, the wardrobe and the escheators followed. The undated statute of the exchequer (probably about 1276) provides for escheators, the earldom of Chester, the Channel Islands, the customs and the wardrobe. During the reign of Edward I., the wardrobe account became unmanageable, since it not only financed the household, army, navy and diplomatic service, but raised money on the customs independently of the exchequer. The reform of 1323–1326, due to Walter de Stapledon, in remedying this state of things, greatly increased the number of “foreign accounts” by making the great wardrobe (the storekeeping department), the butler, purveyors, keepers of horses or of the stud, the clerk of the “hamper” of the chancery (who took the fees for the great seal), and the various ambassadors, directly accountable to the exchequer. At the same time the sheriffs’ accounts were expedited by the further simplification of the great roll, and by appointing a special officer, the “foreign apposer,” to take the account of the “green wax,” or estreats, so that two accounts could go on at once. Another baron (the 5th or cursitor baron) was appointed, and the whole business of foreign accounts was transferred to a separate building where one baron and certain auditors spent their whole time in settling the balances due on the accounts already mentioned, as well as those of castles, &c., not let to farm, Wales, Gascony, Ireland, aids (clerical and lay), temporalities of vacant bishoprics, abbeys, priories and dignities, mines of silver and tin, ulnage and so forth. These balances were accounted for in the exchequer itself, and entered on the pipe roll, but the preliminary accounts were filed by the king’s remembrancer, and enrolled separately by the treasurer’s remembrancer as a supplement to the pipe roll.
The next important change, about the end of the 15th century, was the gradual substitution of special auditors appointed by the crown, known as the auditors of the prests (the predecessors of the commissioners for auditing public accounts), for the auditors of the exchequer. Accounts when passed by them were presented in duplicate and “declared” before the treasurer, under-treasurer and chancellor. Of the two copies, one, on paper, was retained by the auditors, the other, on parchment, was successively enrolled by the king’s and lord treasurer’s remembrancers, and finally by the clerk of the pipe, to secure the levying of any “remanets” or “supers” by process of the exchequer.
Besides the two great difficulties of the postponement of financial to legal business, and of preventing the sheriffs from exacting the same debt twice, the exchequer was, as has been seen, hampered in its functions by the interference of other departments in financial matters. Its own branches even acquired a certain independence. The exchequer of the Jews, which came to an end in 18 Edward I., was such a branch. In 27 Henry VIII. the court of augmentations was established to deal with forfeited lands of monasteries. This was followed in 32 & 33 Henry VIII. by the courts of first-fruits and tenths and of general surveyors. These were reabsorbed by the exchequer in 1 Mary, but remained as separate departments within it. But the development of the treasury, which succeeded to the functions of the camera curie or the king’s chamber, ultimately reduced the administrative functions of the exchequer to unimportance, and the audit office took over its duties with regard to public accounts. So that when the statute of 3 & 4 William IV. cap. 99, removed the sheriff’s accounts also from its competence, and brought to an end the series of pipe rolls which begins in 1130, the ancient exchequer may be said to have come to an end. (C. J.)
In 1834 an act was passed abolishing the old offices of the exchequer, and creating a new exchequer under a comptroller-general, the detailed business of payments formerly made at the exchequer being transferred to the paymaster-general, whose office was further enlarged in 1836 and 1848. And in 1866, as the result of a select committee reporting unfavourably on the system of exchequer control as established in 1834, the exchequer was abolished altogether as a distinct department of state, and a new exchequer and audit department established.
The ancient term exchequer now survives mainly as the official title of the national banking account of the United Kingdom. This central account is commonly called the exchequer, and its statutory title is “His Majesty’s Exchequer.” It may also be described with statutory authority as “The Account of the Consolidated Fund of Great Britain and Ireland.” This account is, in fact, divided between the Banks of England and Ireland. At the head office of each of these institutions receipts are accepted and payments made on account of the exchequer; but in published documents the two accounts are consolidated into one, the balances only at the two banks being shown separately.
Operations affecting the exchequer are regulated by the Exchequer and Audit Departments Act 1866. Section 10 prescribes that the gross revenue of the United Kingdom (less drawbacks and repayments, which are not really revenue) is payable, and must sooner or later be paid into the exchequer. Section 11 directs that payments should be made from the fund so formed to meet the current requirements of spending departments. Sections 13, 14, 15 lay down the conditions under which money can be drawn from the exchequer. Drafts on the exchequer require the approval of an officer independent of the executive government, the comptroller and auditor-general. But the description of the formal procedure required by statute cannot adequately express the actual working of the system, or the part it plays in the national finance. The simplicity of the system laid down by the act of 1866 has been disturbed by the diversion of certain branches or portions of revenue from the exchequer to “Local Taxation Accounts,” under a system initiated by the Local Government Act 1888, and much extended since.
While the exchequer is, as already stated, the central account, it is not directly in contact with the details of either revenue or expenditure. As regards revenue, the produce of taxes and other sources of income passes, in the first instance, into the separate accounts of the respective receiving departments—mainly, of course, those of the customs, inland revenue and post office. A not inconsiderable portion is received in the provinces, and remitted to London or Dublin by bills or otherwise, and the ultimate transfers to the exchequer are made (in round sums) from the accounts of the receiving departments in London or in Dublin. Thus, there are always considerable sums due to the exchequer by the revenue departments; on the other hand, as floating balances are (for the sake of economy) used temporarily for current expenses, there are generally amounts due by the exchequer to the receiving departments; such cross claims are adjusted periodically, generally once a month. The finance accounts of the United Kingdom show the gross amounts due to the exchequer from the departments, and likewise the amounts payable out of the gross revenue in priority to the claim of the exchequer. On the expenditure side a similar system prevails. No detailed payments are made direct from the exchequer, but round sums are issued from it to subsidiary accounts, from which the actual drafts for the public services are met. For instance, the interest on the national debt is paid by the Bank of England from a separate account fed by transfers of round sums from the exchequer as required. Similarly, payments for army, navy and most civil services are met by the paymaster-general out of an account of his own, fed by daily transfers from the exchequer.
This system has two noticeable effects. Firstly, it secures the simplicity and finality of the exchequer accounts, and therefore of all ordinary statements of national finance. Every evening the chancellor of the exchequer can tell his position so far as the exchequer is concerned; on the first day of every quarter the press is able to comment on the national income and expenditure up to the evening before. The annual account is closed on the evening of the 31st of March, and there can be no reopening of the budget of a past year such as may occur under other financial systems. The second effect of the system is to introduce a certain artificiality into the financial statements. Actual facts cannot be reduced to the simplicity of exchequer figures; there is always (as already explained) revenue received by government which has not yet reached the exchequer; and there must always be a considerable outstanding liability in the form of cheques issued but not yet cashed. The suggested criticism is, however, met if it can be shown that, on the whole, the differences between the true revenue and the exchequer receipts, or between the true (or audited) expenditure and the exchequer issues, are not, taking one year with another, relatively considerable. The following figures (000’s omitted) illustrate this point:—
and Aud. Exp.
The third column in the above shows the price which has to be paid (in the form of discrepancies between facts and figures) for the simplicity secured to statements and records of the national finance by the present system embodied in the term exchequer. Probably few will think the price too high in consideration of the advantages secured.
The principal official who derives a title from the exchequer in its living sense is, of course, the chancellor of the exchequer. He is the person named second in the patent appointing commissions for executing the office of lord high treasurer of Great Britain and Ireland; but he is appointed chancellor of the exchequer for Great Britain and chancellor of the exchequer for Ireland by two additional patents. Although, in fact, the finance minister of the United Kingdom, he has no statutory power over the exchequer apart from his position as second commissioner of the treasury; but in virtue of his office he is by statute master of the mint, senior commissioner for the reduction of the national debt, a trustee of the British Museum, an ecclesiastical commissioner, a member of the board of agriculture, a commissioner of public works and buildings, local government, and education, a commissioner for regulating the offices of the House of Commons, and has certain functions connected with the office of the secretary of state for India. The only other exchequer officer requiring mention is the comptroller and auditor-general, whose functions as comptroller-general of the exchequer have been already described.
The ancient name of the national banking account has been attached to two of the forms of unfunded national debt. Exchequer bills, which date from the reign of William and Mary (they took the place of the tallies, previously used for the same purpose), became extinct in 1897, but exchequer bonds (first issued by Mr Gladstone in 1853) still possess a practical importance. An exchequer bond is a promise by government to pay a specified sum after a specified period, generally three or five years, and meanwhile to pay interest half-yearly at a specified rate on that sum. Government possesses no general power to issue exchequer bonds; such power is only conferred by a special act, and for specified purposes; but when the power has been created, exchequer bonds issued in pursuance of it are governed by general statutory provisions contained in the Exchequer Bills and Bonds Act 1866, and amending acts. These acts create machinery for the issue of exchequer bonds and for the payment of interest thereon, and protect them against forgery.
Some traces may be mentioned of the ancient uses of the name exchequer which still remain. The chancellor of the exchequer still presides at the ceremony of “pricking the list of sheriffs,” which is a quasi-judicial function; and on that occasion he wears a robe of black silk with gold embroidery, which suggests a judicial costume. In England the last judge who was styled baron of the exchequer (Baron Pollock) died in 1897. In Scotland the jurisdiction of the barons of the exchequer was transferred to the court of session in 1856, but the same act requires the appointment of one of the judges as “lord ordinary in exchequer causes,” which office still exists. In Ireland Lord Chief Baron Palles was the last to retain the old title. A street near Dublin Castle is called Exchequer Street, recalling the separate Irish exchequer, which ceased in 1817. The old term also survives in the full title of the treasury representative in Scotland, which is “The King’s and the Lord Treasurer’s Remembrancer in Exchequer,” while his office in the historic Parliament Square is styled “Exchequer Chambers.” (S. E. S.-R.)
Bibliography.—For the early exchequer Thomas Madox’s History and Antiquities of the Exchequer (London, 1711) remains the standard authority, and in it the Dialogus de Scaccario of Richard the Treasurer (1179) was first printed (edited since by A. Hughes, C. G. Crump and C. Johnson, Oxford, 1902). The publications of the Pipe Roll Society (London, 1884 et seq.), the Pipe Rolls and Chancellor’s Roll, printed by the Record Commission (London, 1833 and 1844), and H. Hall’s edition of the Receipt Roll of the Exchequer 31 Henry II. (London, 1899) should also be consulted. A popular account is in H. Hall’s Court Life under the Plantagenets (London, 1901), and a careful study in Dr Parow’s thesis, Compotus Vicecomitis (Berlin, 1906). For the 13th and 14th centuries H. Hall’s edition of the Red Book of the Exchequer (London, Rolls Series, 1896) is essential, as also the Public Record Office List of Foreign Accounts (London, 1900). Later practice may be gathered from the similar List and Index of Declared Accounts (London, 1893), and from such books as Sir T. Fanshawe’s Practice of the Exchequer Court, written about A.D. 1600 (London, 1658); Christopher Vernon’s The Exchequer Opened (London, 1661), or Sir Geoffrey Gilbert’s Treatise on the Court of Exchequer (London, 1758), as well as from the statutes abolishing various offices in the exchequer. H. Hall’s Antiquities of the Exchequer (London, 1891) gives many interesting details of various dates. For the Scottish exchequer The Exchequer Rolls of Scotland (Edinburgh, 1878 et seq.) should be consulted, while Gilbert’s book noted above gives some details on that of Ireland. See also Appendix 13 to the great account of Public Income and Expenditure from 1688 to 1869, in three volumes, prepared for parliament by H. W. Chisholm (1869); and for sidelights on the working of the office from 1825 to 1866 the reminiscences of the same author (the last chief clerk of the exchequer) in Temple Bar (January to April 1891).