The use of gold and gold coin in trade and finance in the early 19th Century meant that there was a 'growth industry' for the brokers and refiners of gold. By the 1830s there were two brokers - Mocatta & Goldsmid and Sharps, the former being by far the oldest and the more influential. The refining of gold was in the hands of several firms such as Browne & Wingrove and P.N. Johnson, the forerunners of Johnson Matthey. The Royal Mint itself was also engaged in both refining and the historical role of striking gold coin.
The rivalry between Nathan Mayer Rothschild (1777-1836) and, in the 1820s, Jacob Mocatta and in the 1830s Isaac Goldsmid, led to Nathan trying to break the almost complete monopoly of those firms. The first step was to avoid the payment of brokerage on bullion by dealing direct with the Bank of England. When the collapse of several banks in 1825 led to a run on the Bank of England, it was Rothschilds who came to the rescue with gold purchased from European banks through the family connections.
Discoveries of gold
New discoveries of gold in the 1840s and 1850s brought opportunities to gain control over the means of production. The report of a Royal Commission of 1848, charged with examining the efficiency of the Royal Mint, contained recommendations for the separation of the twin roles of refining and coin-striking. Previously the Company of Moneyers monopolised the coinage work under contract to the Master of the Royal Mint who, acting as an agent for the Crown, also contracted with private individuals for the melting and refining of precious metals within the same premises. It was the lack of clearly defined areas of public and private work that led to the refining being 'hived off' and offered to interested parties on a leasehold basis. Curiously, the offer was not snapped up by Mocatta & Goldschmid and the opportunity was seized by Sir Anthony de Rothschild (1810-1876). The acquisition of the Refinery lease was an important step in the plan to make Rothschilds a leader in the London bullion trade.
By 1860, the Royal Mint Refinery was fully established and in a position to compete for the work arising from the discovery of more new goldfields throughout the world. After the Californian 'rush' of 1849 came the Australian fields in the 1850s followed by the South African discoveries in 1884. Each area brought its own challenges with regard to refining - in the Klondike, gold dust was used as a raw currency but demands for more sophisticated means of movement of gold led to more refineries being built.
The operations of the Royal Mint Refinery
The word 'Refinery' was added to the name of the Royal Mint creating at a stroke the confusion in the public mind that was to last until its demise in 1968. The physical expansion of the new firm took a similar path to that of New Court, namely the acquisition of adjacent premises. Gradually the freeholds were acquired for various houses in Rosemary Lane (now Royal Mint Street) and others in the lanes and courts leading off such as Seven Star Court, Becks Rent and the stabling in St. Peters Court. Some of these buildings were converted into offices whilst others were maintained as cottages by Sir Anthony for Refinery employees. By 1911 there were 33 flats available in adjoining properties and these were granted to married men according to seniority.
The old methods of roasting ores and combining with mercury gave way to improvements using sulphuric acid but the problem of dispersing fumes without upsetting the neighbours remained for many years. In one exchange of letters the manager of the Refinery wrote to the Deputy Master of the Mint that it was hoped that a new chimney would be the answer but it always seemed to be worse in the "mauvais temps". The reason for writing in French was the practice of using experienced workmen from an area north of Paris where these skills were already established together with other specialists recruited from Belgium by the first manager. There was a succession of French and Swiss managers of the refinery with names such as Poisat, Bertrand, Arnould, Dudoit Buess. In 1937 the first manager with an English name was appointed, a Mr. Smith.
The records for this early period in the development of the refinery contain notes in French passed between Poisat, Gallez (the engineer responsible for the new techniques) and Sir Anthony de Rothschild with requests and drafts for expenses or part payments to Messrs William Cubitts. The latter were one of the largest of the Victorian construction firms and it was fitting that they were employed by the House in this new venture. Further developments in the refining of silver brought in more equipment from Europe, such as Moebius Cells for producing much higher standards of purity to meet the demands of industry. Apart from fresh inflows of precious metals from new fields, monetary crises led to demands for the refining of coin to recover their contents.
The Royal Mint Refinery 1890-1914
By the 1890's the success of the refinery operations led to Rothschilds acquiring the freehold of the premises which, from the establishment of the refinery in 1852, had been leased by them. This was done under the aegis of Charles Rothschild (1877-1923), the younger son of Nathaniel, 1st Lord Rothschild (1840-1915). Charles promoted research into new methods - in 1908 Comptoir Lyon-Allemand of Paris wrote a report for him on the separation of gold and platinum by electrolytic methods. Until 1918 the old sulphur method of gold refining had been used at RMR with its by-product of copper sulphate, but the more efficient method of refining by passing chlorine through molten gold ores had been in use in the Sydney Mint as early as 1867.
The Rothschild Archive London contains the complete regulations for the employment of both English and French workmen at RMR. Dating from 1912, it shows the range of salaries, with the manager earning £600 per annum plus a Christmas bonus of £120; the chief assayer £276 whilst his junior earned £72, both receiving their bonuses at Christmas in the order of 10%, whilst English workmen ranged from 30 to 50 shillings per week. With the addition of overtime and Christmas bonus these wages would total from £80 to £130 per annum depending on length of service and skills. Since the French workers were employed first they occupied many of the supervisory positions and the second generation was prominent in the higher wage levels. Seven French foremen earned over £220 against one English foreman who earned just under £200 in 1912.
There were other 'perks' not to be found in many firms before the First World War, the principal ones being ‘National Insurance and Income Tax to be borne by the House. When it came to holidays the allowance of a fortnight for the English workmen was normal at that time but in accordance with an old custom the Frenchmen are allowed three weeks yearly after 10 years’ service. Other attractions were the arrangements whereby ‘Any workman may deposit money with the House up to a maximum of £100, Interest at 4% per annum is allowed on such deposits. They may also invest sums of £100 or more in securities of their own or Messrs Rothschilds' selection, the securities being stored and the dividends being collected, at New Court, free of charge.’
Another more curious perk was for Frenchmen only. A beer allowance was supplied to the English workmen, but the French were given cider, presumably on the grounds that most of them came from Normandy. The money obtained on the return of the empty casks was divided amongst those who did the drinking, and in 1911, 161 casks raised over £40, which was divided between 28 men, who each received 2s 5d each per month. A further less savoury allowance was granted to workmen for mice which they caught on the premises at the rate of 1d each.
(based on notes prepared by the late Mr Spencer Richards)