The poor in the countryside were often exploited as to the prices that they paid for their wheat, or the other articles in the small shops in the village.
David Davies reports that the wheat passed through several transactions until it arrived in the peasant’s cottage:
“ ….. The great farmer deals in wholesale way with the miller; the miller with the mealman; and the mealman with the shopkeeper, of which last the poor man buys his flour by the bushel. For neither the miller, nor the mealman, will sell the labourer a less quantity than a sack of flour under the retail price at shops; and the poor man’s pocket will seldom allow of his buying a whole sack at once. Formerly the wife saved the profits of the mealman and shopkeeper, who now, without adding to the value if the manufacture, do each receive a profit out of the poor man’s earnings. It has been asserted by a good judge of these matters, that this is a disadvantage to the poor of at least ten per cent, upon this prime necessary of life. (See Mr. Kent’s Hints to Gentlemen of Landed Property, p. 277) In short, the poor man buys every thing at the highest price; at a higher price than the rich do. He cannot help this; but must submit to the established order. It is not possible for him, nor is it easy for his superiors, to effect a change, where things have gone on for a long time in a certain train.”
(Davies, 1795, p. 34)
Mr. Vaughan, the Assistant Commissioner in the Report on the Employment of Women and Children in Agriculture, 1843, gives a long commentary on the same sort of monetary disadvantages which the farm labourers have in their purchases in the village shops. He says that “a general conviction prevails that the charges in the villages shops are very high, and the articles very often inferior”. He then quotes the Rev. Thomas Corvey of Cowden in Kent:
“One great and oppressive misfortune to the laborer is the difficulty of expending his earnings to any advantage. Confined to the limits of his small circle, and perhaps only late in the evening receiving his wages, he deals solely with the village shop. In these shops are sold articles of but moderate quality, at very high prices. There are numerous instances of large fortunes being made in the places where the farmers and labourers are the only customers – such fortunes as could only be accumulated by excessive profits and want of competition. A labourer (it is considered) is allowed credit for a small amount, and then obliged to deal under a fear of having his debt called for, and thus of being destitute for the time. It may be true that the shopkeeper, by deaths and other causes, loses money; but with such large profits the effect is slight; and as he knows everybody he has generally good tact, and avoids a bad creditor. Millers commonly pursue the same system. The labourer in consequence, finds himself ill off, and complains that he cannot live on his earnings, when, in fact, he cannot lay them out to advantage. Averages and quotations serve little purpose. Deal here, or pay your debt, is the practical argument. I believe one great cause of the bad condition of the poor is to be found in this.”
Mr. Vaughan says that “it is not an uncommon thing for the families who are in a condition to do so, to purchase six or eight miles from their own homes, rather than at the village shop”. He quotes in this respect, a witness, Mr. Duppa:
“There is just cause for the statement about the dearness of village shops. I can hardly give a better idea of my opinion on the subject than by stating an alteration which I made about a year ago in my hour of paying the workmen. My former hour of payment was seven o’clock on Saturday evening, which I have changed to nine o’clock on Saturday morning. My people are enabled to purchase their goods at the market town in consequence, at the distance of six miles. They have all quitted the village shops for the better and cheaper shops of Maidstone. My opinion is not ruled solely by this circumstance. I am certain there is great foundation for the complaint.”
Mr. Vaughan says that the shops are generally supposed to be 25, 20, or 10 per cent dearer than the town shops, that the articles are inferior, and that the practice of giving credit is used as a method to pressure the people.
Further, in some cases in Sussex at least, the farmers do not pay their workers in cash, but with vouchers cashable in purchases from the shopkeeper or the miller.
“”The cause of articles in this neighbourhood,” says the rector of Brede, in Sussex, “being dearer at the village shops, arises from the infamous system of giving checks upon shopkeepers, instead of paying the labourers in money, as adopted by farmers, I fear, too generally. The hardship in this parish has been excessive through the prevalence of the above system, which, by making the petty shopkeeper the farmers’ banker, at one exposes the labouring poor to whatever exactions their paymaster may think proper to impose upon them; for, under such a system, they have no alternative but to take his goods at his own price or starve.””
(Reports of Special Assistant Poor Law Commissioners on the Employment of Women and Children, 1843, pp. 140-142, Mr. Vaughan, Kent, Surrey and Sussex)
The “truck system” and the “tommy shops” were also used in the industrial areas (colleries, iron works, Black Country), and consisted of forcing the worker to buy the goods in a shop controlled by the owner of the company, or paying him with vouchers which could only be utilized in a shop owned by a business associate. Obviously the owner made a profit from this. William Cobbett gives a clear example from the iron-working district:
“The manner of carrying on the tommy system is this: suppose there to be a master who employs a hundred men. That hundred men, let us suppose, to earn a pound a week each. This is not the case in the iron-works; but no matter, we can illustrate our meaning by one sum as well as by another. These men lay out weekly the whole of the hundred pounds in victuals, drink, clothing, bedding, fuel, and house-rent. Now, the master finding the profits of his trade fall off very much, and being at the same time in want of money to pay the hundred pounds weekly, and perceiving that these hundred pounds are carried away at once, and given to shopkeepers of various descriptions; to butchers, bakers, drapers, hatters, shoemakers, and the rest; and knowing that, on an average, these shopkeepers must all have a profit of thirty per cent., or more, he determines to keep this thirty per cent. to himself; and this is thirty pounds a week gained as a shop-keeper, which amounts to 1,560l. a year. He, therefore, sets up a tommy shop: a long place containing every commodity that the workman can want, liquor and house-room excepted.”
(Cobbett, Rural Rides, Midland Tour, Wolverhampton and Shrewsbury; 18th May 1830)
These systems were made illegal by the Truck Act of 1831, which required that all payments of wages should be made in coin.
As a result of the disappearance of these abuses, the poorer classes paid a lower price level for their food and other necessities. This means that the retail prices did not increase so fast as the wholesale prices.