§ MR. POLLARD-URQUHARTmoved for a Select Committee to inquire into the management of the Loan Fund Societies in Ireland. He begged to call attention to two Acts of Parliament, passed respectively in the years 1836 and 1843, for the regulation and management of those societies which were placed under the control of a Loan Fund Board, and certainly these enactments seemed to be sufficient for the security of the money that was lent. His attention having been called to the circumstances of two loan fund societies in the county he represented, he had looked to the abstract of accounts transmitted to Parliament, pursuant to the Acts to which he had referred, and they seemed fair enough so far as they went; but they were so exceedingly meagre, as to leave great room for imposition. He afterwards attended at the loan fund office, to look more particularly into the accounts, and he found that the figures in several columns were exceedingly garbled. It appeared that some of the persons who had 412 borrowed money from them were men of straw, or had gone to America, and that the persons who professed to be their securities were not to be found. It appeared, also, that a great part of what had been paid off by the borrowers was never actually stated to have been paid off, and no doubt there had been dishonesty in some instances on the part of the clerks, and most culpable negligence in other instances. The result was, that the treasurer, out of his own private resources, had to refund a portion of the money to the poor people, who received a dividend of 8s. in the pound. He thought that, for the sake of similar societies still remaining in Ireland, they should ascertain the amount of security in existence, and what amount of security the Government could force the treasurer to give.
§ Mr. FAGANseconded the Motion.
Motion made, and Question proposed,
That a Select Committee be appointed to inquire into the management of the Loan Fund Societies in Ireland.
§ SIR JOHN YOUNGsaid, he thought there could be no objection to the appointment of a Select Committee, as proposed by the hon. Gentleman; but it was not a question, strictly speaking, in which the Government had anything to do. Many years ago, persons who were in the habit of lending small sums of money to the industrious poor, thought it would be a good thing to obtain facilities for the recovery of those sums, and Acts of Parliament were passed for the purpose, but no Government security was given. A great many persons, at the time those Acts of Parliament were passed, entertained great doubts as to the policy of them, and whether in reality those charitable institutions would be of advantage to the industrious poor; and if doubts were entertained when those Acts were passed, it appeared, from experience, that nothing could be more prejudicial to the interests of the poor than those loan funds; but other persons entertained different opinions. According to this loan fund system, it was impossible to avoid making bad debts. A sum of money was borrowed at five per cent, and lent out at nine per cent, leaving only four per cent for the payment of expenses and the covering of bad debts. They, consequently, found it necessary to keep the money always out on loan, and when they could not get good borrowers they must take bad ones, and in many of them bad debts were contracted where there was the 413 greatest vigilance and accuracy of management. But in the two loan fund societies to which the hon. Gentleman had referred, there was no accuracy at all. The gentleman who had the management lost about 550l., and the debenture holders were also losers, but there was a severe loss inflicted on the gentleman to whom he referred, who seemed to be perfectly single minded, and to have been actuated by the most charitable motives. In conclusion, he begged to say, that there was no objection to the appointment of the Committee.
§ MR. FRENCHsaid, that in 1831 a Bill was brought in by him to limit the interest paid upon the contributions to five per cent, the surplus (if any) to go to charitable purposes. Under that system 17,000l. was paid over to charitable objects in one year, and the system went on satisfactorily until the famine in 1847. He thought the Government had acted wisely in granting the Committee.
§ MR. F. SCULLYsaid, he concurred in the propriety of appointing the Committee, but he thought it well to consider how far the Loan Fund Board could be placed on a more satisfactory footing.
Motion agreed to.