Domestic policy of Henry VII

Key area of importance for him as he did not feel secure on the throne unless he was rich:

• used to reward loyal service 
• Bribe potential opponents
• Fund armies 

Full treasury helps explain unsuccessful rebellions against Henry

King's expected to manage on the regular income they receive. Any attempts to raise finance through tax would provoke opposition (Yorkshire and Cornwall rebellions) 

Henry relied on the Exchequer to organise his finances. This was a system that ran royal finances by employing its own officials; Henry was sub-contracting financial management to the Exchequer. 

Increased the revenue from crown lands:

• In 1486 his income from crown lands was £11,700
• By 1508 this had risen to £42,000

Gave trusted advisors key roles. Thomas Lovell (Treasurer of the Chamber) and SIr John Heron. 

Included lists of debts owed, bonds and recognisances, payment of land sales, wardships and fines.  

King expected to live 'off his own'. Had to pay for day-to-day expenses of government from his regular income. 

Custom Duties (granted by parliament for life)- Increase this source of income by cracking down on corrupt officials and updating the Book of Rates of Customs Duties

Crown lands (King's important source of revenue)- Lands confiscated under acts of attainder, reclaimed after acts of resumption

Feudal dues (granting lands to his tenants-in-chief)- Tenant-in-chief had to pay taxes to inherit land on the death of his father. If the tenant died without an heir, land went to the crown. 

Profits of Justice (enforcement of law and order)- Issuing of royal writs and letters which had to be paid in fines. Fines imposed paid directly to the Crown

King entitled to raise money from one-off payments when he faced emergency or unforseen expenses of government. 

Parliamentary subsidies- Granted him a direct assessed subsidy- a 15th was the rate of tax on goods of laymen, a 10th on the rate of tax on income of the clergy

Loans (raised speedily)- vouluntary loans raised from richer subjects (merchants, City of London)

Benevolences- loans that were forced with threat of sanction, not repaid. Loans could not be seized, had to be handed over.

Bonds and recognisances (political and financial purposes)- bond was a lump sum payable if good behaviour was not observed. A recognisance was acknowledgement of debt

Fedual obligations- tenants-in-chief obliged to pay aid to the King on knighting of eldest son and marriage of eldest daughter

Clerical taxes- Vacant bishoprics, the King kept the revenue 

The French pension (one off payment)- annual pension from France in the Treaty of Picquigny 

The domestic economy at the end of the 15th century

Industry was dominated by the wool and cloth 'industry'. 

Most important exports were wool and cloth, others included barley and malt.

London was the biggest city with 50,000 inhabitants. Norwich, Bristol, Newcastle and Coventry all had a population of around 10,000 and there were hundreds of small market towns. These urban areas were centres for a wide variety of crafts and trades. 

Merchants in the most important towns of England came together to form trading companies. 

Parliament passed 50 statutes concerned with economic matters but these were driven by groups such as merchants.

There was relatively little crown-directed economic growth or change during his reign.

Most important influence on economic activity was the harvest. It determined whether there would be abundant food or widespread starvation and disease. 

Fluctuations in harvest were reflected in the fluctuations in the price for basic foodstuffs, direct impact on size of population and condition of people

Agriculture was most important sector of the economy. Much of the country had been farmed since middle-ages by the open-field system. 

Being challenged by enclousure. This was fencing-off of land and abolition of common rights over it, it became the responsibility of the owner, who could use it however. 

Advantages:

• Land more suited to sheep farming 
• Division of land into properly fenced off fields
• Practise of selective breeding of animals 

Disadvantages:

• Lead to eviction of families 
• Depopulation of villages 
• Lead to vagabondage (peasants landless/ unemployed)

Wool

Become the country's major industry by the start of Henry's reign accounting to 90% of all exports. Was in great demand in European markets.

Expansion of the cloth industry aided by an increase in population beginning to create larger pool of labour. 

However, danger of war, bad harvets, plague disrupted trade. Result in a drop in demand, less money, people out of work. 

The Linen industry

Beginning of the production of other types of fabric. Lancashire used local flax, Irish import of yarn to maintain its output of wollens which people depended on for work and clothes. 

Changes to coinage

Henry introduced new denominations in gold and silver and new designs, Also introduced a shilling piece which had a portrait of the King. 

Some developments, England still industrially backwards by continental standards. Apart from manufacture of woollen cloth, industry was on a small scale.

Only provided £40,000 in 1509 to the Crown.

The devlopment of shipping

Much of England's trade carried in foreign ships, Navigations Acts of 1485-86:

• Forbade foreign ships if English ships avaliable 
• Lucrative trade with Bordeaux
• Wines could only be imported

The Cloth Trade

1489 law passed which forbade foreign merchants buying wool until English merchants had bought all they wanted. Illegal to buy wool for manufacture into cloth outside England

Malus Intercursus

Trading agreement between Philip of Burgundy. 

• Trade with England would be free
• English merchants allowed to anchor in Philip's harbours 
• Philip's subjects to pay customary duties 

Trade with France

Increase trade with France met with limited success.

• 1487 France restrictions on trade 
• 1492 both countries restrict trade as part of Treaty of Etaples
• 1495 France ended all restrictions 

Italy and the Mediterranean trade

Counter the influence of the Venetians who controlled luxury goods. Venetians able to charge high prices when brought to northern Europe. 

• Encouraged English ships to import malmsey from Levant 
• Treaty with Florence in 1490
• Venetians gave in and let English shipping in the Levant 

Spain and Portugal

The Treaty of Medina Del Campo ended restriction and finalised mthe marriage of Prince Arthur to Catherine of Aragon

The Hanseatic League and Baltic trade

Henry wanted to bypass the Hanse and sell English cloth in Northern markets. 

• Forbidding any foreigners exporting cloth from England 
• Hanse not allowed to take money out of the country
• English merchants captured Hanse ships went unpunished 
• German merchants attacked in London 

Success?

• Increased outlets for English trade 
• Forward-thinking treaty with Spain
• Forged openings in the Mediterranean and Scandinavia 
• English shipping expanded 

However, did not greaty improve his financial position.

John Cabot

Obtained an audience with the King and outlined a plan to sail more northerly route than Columbus. Henry authorised Cabot to set sail as he was lured by the profits that could be made from eastern trade in luxurious and spices.

Henry showed caution, only gave £50 but wouldn't commit any further until proof of success. Cabot died on the voyage home.

Sebastian Cabot

Proved to be more successful than his father. Support of Henry set sail to seek the north-west passage. Cabot sailed around Greenland and across Davis Strait to open water. This was the Hudson Bay.

On return, Henry VII was dead and a new king was on the throne. Henry VIII did hot share his father's interest in exploration.