The Equivalent Company, company of debenture holders, 1721-1851

Article fifteen of the Treaty of the Act of Union of 1707 stipulated that Scotland would be paid a lump sum of £398,085 10s - known as the Equivalent - which was to compensate Scotland for taking on a share in England’s national debt. This sum was also to be used to cover, among other items, losses ‘privat persons may sustain by reducing the coin of Scotland to the standard and value of the coin of England’ and to repay dividends on stock held in the Company of Scotland Trading to Africa and the Indies which became defunct at the time of the Union.

Distribution of the Equivalent was entrusted to 25 commissioners and was paid in notes, coin and exchequer bills. The distribution proved controversial, with the Commissioners being accused of favouring themselves and the wealthiest creditors. There was no annual subsidy for woollen and other manufactories as promised, while payments due to a variety of creditors including salaries due to army officers, state officials and tradesmen remained unpaid. To placate these claimants an Act of Parliament was passed to issue debentures with an interest of five per cent from June 1708. However, the debentures carried vague details about the date of paying interest and remained unpaid for the next six years when they were called in by Parliament. Further attempts to meet the debts were piecemeal and, amid rising discontent, one of the Commissioners, Patrick Campbell of Monzie, was sent to London to put the Commissioners’ case to Parliament. His mission was unsuccessful and it was not until 1719 that an Act was passed for making provision of a yearly fund of £10,000 to be paid out of Scotland’s customs and excise as interest on £248,550 worth of debentures.

...