ADJOURNED DEBATE.

HC Deb 07 March 1864 vol 173 cc1548-613

Order read, for resuming Adjourned Debate on Question [4th March!, "That Mr. Speaker do now leave the Chair."

Question again proposed.

Debate resumed

MR. SPEAKER

said, he would remind the House of the exact position of things with respect to this subject. The hon. Member for Dudley (Mr. Sheridan) who had a notice on the paper in reference to the Bill, gave it up last Friday on the understanding that a certain clause of the Bill would not be proceeded with that evening. The hon. Gentleman spoke on that point, but not at all on the general subject of the Bill, and the right hon. Gentleman the Chancellor of the Exchequer also replied, not on the subject of the Bill, but merely with regard to the proposed arrangement. The hon. Member for Cambridge (Mr. Powell) then moved the adjournment of the debate. Now, according to the strict rules of the House, the hon. Member for Dudley, and the right hon. Gentleman the Chancellor of the Exchequer, would be considered as having spoken on the main question, and it would be his duty to enforce the rules of the House, unless otherwise directed, and he therefore desired to know whether, under the circumstances, it was the pleasure of the House to put those two hon. Gentlemen into a position to speak on the main question?

MR. DISRAELI

said, he thought it would be very inconvenient if the two Gentlemen who, perhaps, were best informed on the subject, should be precluded from speaking on it, and he trusted after the proper notice taken of the matter by the Speaker, the House would consent to allow the two hon. Gentlemen to speak on the main question.

THE CHANCELLOR OF THE EXCHEQUER

said, lie was entirely in the hands of the House. He confessed that he was anxious to make a statement in regard to the Bill, and he thought the time had come for so doing if he were allowed.

MR. H. B. SHERIDAN

said, he understood that the hon. Baronet the Member for Hertfordshire (Sir Minto Farquhar) had a proposition to make to the right hon. Gentleman (the Chancellor of the Exchequer), which would render unnecessary any decision on the merits of the Question. That proposition was, he understood, to refer the debatable part of the Bill to a Select Committee. If the right hon. Gentleman would accede to that proposition, he thought much time would be saved, and a discussion on the matter now would be unnecessary.

SIR MINTO FARQUHAR

said, he thought that the best course would hare been for the hon. Member for Dudley (Mr. H. B. Sheridan) to have made his statement to the House, and after him the right hon. Gentleman (the Chancellor of the Exchequer), and then it would have been competent for him (Sir M. Farquhar) to move an Amendment for referring the Bill to a Select Committee. That, he thought, would be the most convenient course.

VISCOUNT PALMERSTON

I would suggest that the most convenient course would be that the House should at once go into Committee on the Bill, and that my right hon. Friend should, in Committee, make that statement with respect to the clause which can he made most regularly in that stage. My right hon. Friend will not press the House for any decision upon the clause to-night, but will postpone it to some future day. In this manner the House will, I think, have a better opportunity of fully discussing the Bill than when you, Sir, are in the chair, and no time will be lost.

LORD JOHN MANNERS

It appears to me that the object of my hon. Friend (Sir Minto Farquhar) will be entirely frustrated by such a course of proceeding. He proposes, rightly or wrongly, that the Bill shall be referred to a Select Committee, but the noble Lord proposes that the House shall go into Committee to discuss the first clause.

THE CHANCELLOR OF THE EXCHEQUER

In that case there can, I think, be no doubt as to the best course to be pursued. I was not at all aware that it was intended to propose that the Bill should be sent to a Select Committee. I should have expected that due notice would have been given of it. [Sir MINTO FARQUHAR: The intention was formed only this evening.] I presume, then, it will be better that, with the permission of the House, I should proceed to make my statement now. I must, however, beg the House to observe, that I am placed in the peculiar position of having to make a statement, not on the Bill generally, but on a particular clause of it, on the Motion that the Speaker do leave the chair; and that, when I have made my statement, I shall not be able to offer any explanation in answer to the comments or the inquiries of hon. Members. With these few introductory words, I will just state to the House the history of this proposal, which is a very simple one. The Legislature has thought fit to appoint a public officer, whose business it is to register from time to time certain facts with regard to the condition of Friendly Societies, and to make an annual Report to the Government on that subject. In the autumn of last year, when, of course, Parliament was not sitting, that annunl Report was printed and circulated. It recorded a great number of failures on the part of Friendly Societies, and many very gross abuses and violations of trust. It was also filled with a multitude of complaints from persons in all parts of the country, as to the position in which they found themselves placed by the operation of the rules of many of these Societies. The question seemed to be of such importance, and had reached such a state of maturity, that it became the subject of prolonged discussion in many of the newspapers. Two of the most important journals—The Times and The Daily Telegraph—published articles calling attention to what they deemed the dangerous and scandalous condition of many of these institutions. It had often been suggested to me that the subject of small life assurances, having already received in principle the sanction of Parliament, ought, under present circumstances, again to be considered by the Government. On adverting to the nature of the facts which had been brought forward through the medium to which I have referred, and also through the other media of judicial proceedings and the like, I came to the conclusion that it was the duty of the Government to render real and operative a provision of the law which had hitherto remained inoperative. And here I would desire the House to remember the circumstances under which I introduced the Bill. I brought it forward at the opening of the Session, when I thought it most likely that hon. Members would have leisure to give full attention to it, and I did so in a manner unpresuming, and not aggressive. I deemed it my duty to avoid painful discussion in regard to the condition of institutions which claim, and, to a certain extent, receive, the public confidence. I did not say a single word, or if I did it was in a very brief and general way, in allusion to the state of these bodies being such as to require the attention of Parliament. I do not mention that to commend myself, but in order to point out the different position in which I am now placed. There is no one, I should imagine —at least, I know of none—who thinks that savings banks, or the grant of annuities or assurances for the people, are mat- ters with which it is desirable abstractedly for Government to deal. If it could be said that the operation of the great law of supply and demand is generally satisfactory and sufficient, and that the failures which occur are incidental to the principles on which commerce must be conducted, that would be a conclusive condemnation, not merely of the proposal which I now make, but of the law you passed two years ago for Post Office savings banks, which interfered distinctly with a certain portion of the banking business of the kingdom, and also of the laws as to the grant of annuities and the old savings banks.

Complaint has been made as to the alleged hurrying on of this Bill. It has been said that it has been pressed forward in an unprecedented manner. What are the facts? Notice was given of it on the first day of the Session. The Bill was introduced on the 11th of February, it was circulated immediately afterwards, it was read a second time on the 15th; delay was asked for on the 19th by the hon. Member for Dudley; and now, on the 7th of March, it is surely not unreasonable for me to ask leave to bring the provisions of the Bill before the House.

Before, however, I proceed to discuss the particular provisions of the Bill, I wish to put aside two points, important in themselves, but of which it is desirable to disembarrass any general consideration of the question, as they are purely collateral, and points for which other provision will be made. Inquiry was very properly made when the Bill was first presented, whether we proposed to compete with the Insurance Offices, availing ourselves of the advantage of certain legal exemptions from duty, which must be in the nature of a premium on the business we did, and a penalty on the business of the offices. My answer is that we make no such proposal. We intend that we shall be compelled to do any business in this department under precisely the same conditions which rule independent Assurance Societies. The other objection to which I refer would, I admit, have had the greatest weight had it not been aimed at an intention which did not exist. It has been justly observed that the operation of life assurance and of deferred annuities is directly the reverse of the operations of life or terminable annuities, properly so called—I mean those which are of immediate commencement, in its bearing on the National Debt. When the Government sells an immediate annuity, whether for life, or for a term of years, the effect on the National Debt is this:—The price received for the annuity is immediately applied to the extinction of stock, and that stock being extinguished, the result is not a diminution but an increase of the annual charge, with this difference, that you have a temporary in lieu of a permanent obligation. Although there is thus an augmentation of the temporary charge, there is an ultimate diminution in the capital of the debt. Now, if we observe the converse process, and the law of a deferred annuity does observe it, the operation is this:—You receive money as a premium for the purchase of a deferred annuity or a life assurance, and if you were to apply the price received to the extinction of stock, you would be getting rid of a present charge, but contracting an ulterior and distant liability. That would be a very bad financial arrangement, and, therefore, it is part of my plan, that in a separate Bill, which the House will be able to discuss before the present measure passes through its stages, I will propose that stock which may be purchased by the premium on a deferred annuity or life assurance shall not be extinguished, but shall be held, so that there shall not be a present relief at the expense of future liability.

I am not here to deny that every proposal which involves an assumption on the part of the Government to transact any business whatever on behalf, not of the State but of itself, is a fair subject for adverse criticism. Every such proposal calls for the careful and even jealous scrutiny of the House, and cause must be shown for it in a double form—first of all, that there is an evil to be redressed, and second, that the means proposed for its redress or mitigation are in themselves practicable and unobjectionable. Government interference is a matter in regard to which my own prepossessions are at least as strong as those of most members of the House. We have seen it largely adopted within our own generation. The highest form in which it has been carried out is that of positive regulations requiring this thing and that thing to be done in the course of private commercial arrangements, for the sake of obviating social, moral, or political evils. That is the highest form of Government interference. Of such a nature were some of the provisions in the Factory Acts and many of our sanitary arrangements. There is here, undoubtedly, a very great interference with the liberty of private action, and this interference has been eminently characteristic of the present period. I will not say whether, in any case, it has not been carried too far, but, on the whole, it has been adopted by Parliament, not from any foregone conclusion in favour of that mode of meddling with private concerns, but, under a sense of the exceedingly grave evils to be remedied, and that we are not able to obtain the same result by any other means. I am bound to add that I believe it has been, in general, beneficial. The second kind of Government interference—less high than that to which I have referred—has been interference by sheer naked prohibition. You have prohibited by your Factory Acts the employment of children beyond a certain number of hours, and the employment of young persons beyond a certain other number of hours. That, likewise, is an important interference with private liberty, but it is an interference as to which it may be said that the Legislature is now almost unanimous with respect to the necessity which existed for undertaking it, and with respect to the beneficial effect it has produced both in mitigating human suffering and in attaching important classes of the community to Parliament and the Government. Now we come to the third, and, I must say, the mildest description of Government interference. It is the description with which we have now to deal, and it amounts simply to this, that by the interference of the Government you enjoin nothing and you prohibit nothing, but you offer to such numbers of the community as may be disposed to avail themselves of your proposal certain facilities for what I may call self-help. These are the precise limits of the plan which I have now to explain and to defend before the House. I do not deny that it is Government interference, or that it requires justification and apology; but I do deny that we are to be frightened and terrified by clamours respecting centralization, or respecting undue assumption of powers by the Executive, so as not to inquire into the true merits of the case, the position in which we stand, and the duty we owe to our constituents and the country. All that is requisite in such a case is to show that what the Government proposes to do it can do safely, and likewise that what it proposes to do it can do justly.

But, Sir, a notion has gone abroad which I am anxious to sift rather strictly, that this is a proposal novel in principle, that it is an invitation to Parliament to take upon themselves responsibilities where, at the present moment, they have no responsibilities at all. Is that so? I do not refer now to the simple fact that there is a clause existing in an Act of Parliament which enables the Government to grant life insurances. That clause has been up to the present time inoperative. Whether it will continue so with the existing machinery I do not now inquire. I do not refer to that clause at all; that is a small portion of the responsibility which Parliament has undertaken. I venture to tell the House that this Bill has grown, not out of a consideration of the case of Assurance Societies, but out of a consideration of the case of Friendly Societies, and of the wholesale error, but not error only, for along with error, deception, fraud, and swindling, which are perpetrated upon the most helpless portions of the community, who find themselves without protection and without defence. I want to know what are these Friendly Societies, because to my astonishment I received a deputation from two of the largest of them on Saturday, who said, "We appeal to you not to interfere with private trade and private enterprize?" Private trade and private enterprize, forsooth! Why, these Friendly Societies are virtually and substantially subsidized by the Government; and I will tell you how. They are subsidized in two forms. First of all, as to the large number of them which date before a certain period, they are subsidized by the positive payment to them of money grants every year in the shape of an interest which we are compelled to pay, and which we cannot make. The rate of interest which at the National Debt Office we are compelled to pay to such Friendly Societies as existed before 1828 is £4 11s. upon every £100 of their money. That is equivalent to a payment of little short of £1 10s. per annum upon every £100 out of the purse of the State in support of certain Friendly Societies. With respect to those founded up to 1844 the rate of interest is not £4 11s. but £3 16s., which, though not so large a sum, is an interest that it is totally impossible for the public to make. Secondly, I contend, without the least fear of contradiction, that all the exemptions given to friendly societies are grants. I used an argument to that effect last year in the case of charities, but it was contested by some hon. Gentlemen, who denied that the exemptions given to charities were to be considered as grants. I adhere to my own opinion; but I do not wish to revive the controversy. The proposition I now make does not require me to do so. Let the House observe that there are two parties doing the business in which we are said to interfere—societies which are under the Friendly Societies' Act, and societies which are not under that Act. Every society which is not under the Friendly Societies' Act is subject, through its members, to payment of income tax, to payment of probate duty on life insurances, and to payment of stamps. Societies under the Friendly Societies' Act are exempted from payment of stamp and probate duty absolutely under £50, and from £50 up to £200; if any party chooses to exercise the right of nominating a relative before he dies, he is exempted from stamp and probate duty. I hold, therefore, that it is too late to say that we are not responsible with respect to Friendly Societies. They are not operating upon the common principle of the liberty of the citizen to turn to the best account the means of which he is possessed. They are societies operating to a great degree through the medium of these exemptions from taxes, which place them on a footing of favour and advantage as compared with their competitors, and which are precisely the same, in effect, as if we were to put them under an equality of taxation, and then to return them the money out of the Exchequer in the shape of public grants. Such being the state of the law, when we found that to these Friendly Societies we are making yearly payments in hard money, giving them 40 or 50 per cent more than we derive from the use of their funds, when we found that we exempt them from taxes which every other citizen is compelled to pay, we had no difficulty in coming to the conclusion that we are responsible to a considerable degree for the safety and condition of these societies. We saw that the case is no longer like the case of Loan Societies, which may be conducted upon unsound principles; for under various pretexts we stimulate, we force the production of Friendly Societies, we aid and encourage them to every practical intent and purpose; and when we have done that it is too late to say that it is something novel to propose to look at the condition of these societies, and to see whether it is possible, by any means, to mitigate the evils they have produced.

Sir, I think it will appear that we have chosen a very mild form of intervention, and that we have chosen a proper time for the remedy. Whether there be any other remedy I shall consider presently; but what I wish to point out now is, that the remedy we have chosen is precisely analogous to that adopted with respect to Post Office savings banks. I am not speaking of the difficulties we have had to encounter in the two cases —they will come by-and-bye, but I say that the principle of the remedy is the same in both cases. In the case of the Post Office savings banks, we had to deal with Loan Societies offering the most attractive terms to the public, promising them a rate of interest which could not possibly be paid under any sound or honest management, and then ending in disappointment and ruin. We did not attempt the foolish task of prescribing laws by which all Loan Societies should be regulated, and under which alone the poorer classes of the community should be permitted to lend their money. That was totally impossible. You could not possibly defend the poor man against the abuses and dangers into which he might choose to run head foremost with his eyes open; but what you did was this: —You said, "It is but just to them, and it is expedient and politic in the highest sense, in discharge of the most sacred duty of the Legislature, that we should give to poor men, to the owners of small savings, the advantage of a scheme which will possess no meretricious attractions, which will not promise a high rate of interest— on the contrary, the rate must be a low one—but which will offer an absolutely certain security." That is precisely the basis of the scheme now before the House. I think I may take it for granted that very serious and extensive mischiefs exist.

That being so, the two main questions which we have now to consider are these —first, is the plan we propose a safe plan; and secondly, does it involve injustice? If our plan is both safe and just, I hold it ought to be adopted. With regard to the safety of the plan, I hope the House will not think I am going too far when I say that we have some claim to confidence. I would not venture to say so if I were urging that claim on behalf of myself, or of any particular party, or of any particular Government; but the truth is, that the whole credit of the arrangements under which recent measures have been worked out is due not to us, but to able men connected with the permanent Civil Service establishments. It is due to such men as Sir Alexander Spearman, Mr. Chetwynd, of the Post Office, and, above all, that indefatigable and most able public servant, Mr. Scudamore, of the same establishment. These are the men to whose judgment and ability we owe the success of recent legislation, and in whom, I am sure, the House will be disposed to confide. I admit, however, that the House may fairly feel great jealousy in approaching the discussion of the proposal now before it. Nay, more, I am willing in any way to meet that jealousy. I will endeavour to meet it, in the first place, by offering such explanations as I have it in my power to submit to the House; and, in the second place, I will meet it by saying that I should not object to provide in the Bill, if thought desirahle—though, for my own part, I cannot say that I believe it to be necessary—that any rules which may be adopted for the purpose of giving effect to the provisions of this Act shall be subjected to the scrutiny and approval of this House, in the same manner as are now the Minutes of the Education Committee of the Privy Council. So that the House will have an opportunity of judging before a rule comes into operation, whether it is a safe and wise rule, or not. I meant that partly as a compliment to my right hon. Friend, who, I believe, intends to-morrow to avail himself of that power and to question an important minute of the Privy Council on Education. But this subject is one which readily admits of an ample and a general discussion.

It is easy to see in what manner danger may arise from working a scheme of this kind. It may arise, first, from fraud in respect to the badness of lives, and second, from personation. There are parts of this country, I am told, though I will not point them out more particularly, where the inhabitants are such adepts in the art of personation that some of the Insurance Offices decline to have any transactions at all in them. Let me point out what I conceive to be the fundamental distinction between the business which it is proposed that the Government shall undertake at the option of the public and the ordinary business of Life Assurance Companies. Let me ask the particular attention of the House in considering the supposed difficulty we shall have to meet in dealing with the lives of the labouring classes; for we should look exactly at the province naturally marked out for a proposal of this description. If the assurances are not to exceed £100 they will—with exceptions so few that they may be put out of sight—be those exclusively of the working classes. We exclude children and young persons under sixteen altogether, because such lives are of a character admitting of a good deal of uncertainty and fraud, and form a department of business which we do not think it would be wise or safe to undertake. Practically, then, those who will insure their lives with us will be fathers of families, labouring men. Is it very difficult to ascertain the value of such lives? I allege, without fear of contradiction, that it is not. In the first place, we have the means of doing it, either through the medical profession generally, as far as their certificates are concerned, or through those special medical officers attached to the guardians of the poor, who are themselves officers of the State. As far, therefore, as medical means go, we have all that can be desired; but what I venture to say, and say boldly, is this: That although the ascertainment of the value of life in the higher classes of the community is a matter of great subtlety and difficulty, requiring first of all the application of the highest medical skill, and afterwards a jealous scrutiny besides, yet the value of life in the case of a labouring man is a matter of comparatively simple calculation. You have to know three things, each of them easily ascertainable. The first is his age—a matter of fact, and beyond opinion; the second is his employment, also a matter of fact, not of opinion; and the third, is he a sober man, not a drunkard? These, I repeat, are the only three things to be ascertained with regard to a labouring man. Of course, I do not say that in every individual case you will know the value of the life, but that you will generally know it quite accurately enough to work your tables. Some time ago I had an opportunity of discussing tins point with an eminent member of the medical profession in London, himself the consulting medical officer of two Assurance Offices. I asked him whether that was the ease. He said it was, and he used these words:—"In the case of industrial assurances we scarcely look at our medical papers," thus distinctly affirming the proposition that in regard to the labouring classes the employment and the general character, as palpably known to all the world, are in the long run a sufficient and satisfactory test of the value of the lives. Then, as to personation, we have some experience already, because we have been working our system of savings banks for some time, where there is plenty of temptation to personate, and yet not a single instance of it has occurred. My belief is that, comparing the case of a Government department with that of the Assurance Offices of a large description—I do not speak of the Friendly Societies, which are strictly local in their character—the means we have for ascertaining identity are very superior to those possessed by the Assurance Offices, because a man who insures with the Government has, in point of fact, every means of getting his identity tested. The Government knows, with regard to all its business, that it has natural allies in all those persons best acquainted with the condition of the labouring classes throughout the country. Take the clergy, the dissenting ministry, the magistrates, the Poor Law Guardians, the registrars— I do not speak of the postmasters, on whom it would not be well to depend, for we want them generally for the performance of routine duty only; but, with the aid of the different classes of men whom I have mentioned, and last, but not least, with that of the employers of labour, I say it is perfectly easy for the Government to defend themselves against the risks of fraud through personation. Well, it has been carefully considered in what way the system could be worked. I admit that here we stand in a different position from that in which we are placed under the existing law, where the deferred annuity that is required to be purchased is itself looked to as a security. But, undoubtedly, all the inquiry we can make convinces me, in the first place, that the ascertainment of the value of the lives of labouring men is, as a general rule, and with very rare exceptions, a matter easy and simple; and that, with respect to frauds through personation, those frauds are not found to present any vital difficulty in the way of the societies which now exist; whereas, in my opinion, a Government department would cope with them much more easily. As to taking bad lives, consider the case of the existing societies, which have agencies all over the country, and which induce their agents to draw lives into their net by promising them, independently of their other fees, 25 per cent upon the whole value of the premiums to be received. It is a matter of fact that there are now societies with their hundreds of thousands of members existing under your auspices, countenanced by you, authorized by you, subsidized by you, as I have shown, who are drawing lives into assurance in connection with themselves by giving to their agents, irrespective of certain other emoluments, no less than 25 per cent of the whole premiums to be paid, which is a larger sum than ought to cover almost twice, the expenditure of a sound and well constituted assurance society. And what is the effect of that upon fraud and personation? I say to an agent, "Go you round a certain district, town, or village, and you shall have 25 per cent of all the premiums of the men you can bring into assuring;" and then I am to expect, forsooth, from that man that he is to be very scrupulous and particular in the selection of good lives. So much for the mere safety of these operations.

The next question, and it is a most important one, is—Is this a measure that can be undertaken justly with respect to those parties who are now engaged in carrying on business which is supposed to be of this description? There are three classes of societies which it is necessary for us to take into view. Although I have said that the state of the Friendly Societies is one reason which makes us think it requisite to submit this proposal to the House, yet we are aware that the subject also touches the domain of the Assurance Societies—societies which work independently, by the powers which the law has given them, and not under cover, or by the aid of any exemption or any subsidies from the State. I will consider the three categories of bodies with which we have to deal. One class is the case of the principal assurance societies; the second is that which we may call the minor assurance societies —that is to say, either societies which have but a limited range of business, or societies which deal exclusively in what are termed industrial premiums; and the third class is the Friendly Societies. Now, the question I have to try is, whether this proposal is a just proposal on the part of the Government and fit to be adopted by the Legislature as respects any possibility of trenching on the province of these societies. I will deal first with the case of the principal Assurance Societies. It would be invidious to attempt to define more particularly what I mean by that term, but hon. Gentlemen conversant with the internal state of what may be called the assuring world know perfectly well what is a good and what is a bad society, and that the character of every society is pretty well appreciated by the intelligent and well-informed commercial classes. I speak of them, therefore, without pointing them out, and I have first to consider what is their attitude with regard to this measure. Their attitude in regard to it appears to me to be either one of neutrality or of favour. They do not desire small business, and they know perfectly well that the business of the Government must be small and can not be large. Why do they believe it must be small? First of all, because the sum pointed out by the Bill is small; secondly, because they assume that no Government is ever likely to think it requisite or rational to attempt to interfere with assurance business, properly so called, by which I mean the business of these societies; and thirdly, because they are pretty well aware that if the Government were to make such a demand, there would not be the smallest chance of Parliament acceding to it. But further, I venture to say that if a Government were to be so unreasonable as to make such a demand, and even if Parliament were to be so pliable as to accede to it, it would not even then be in the power of the State, with all its influence and authority, to shake the position of many of these societies. There are a great many of them which, under any circumstances, could snap their fingers at the State. I will show that these societies do not desire small business, and I will show it in this way. There is in the Post Office Department a largely organized system of life assurance for its minor officers. The business is carried on in this manner:—The heaviest item in the current expenditure of an Assurance Society usually is the collection of the premiums, particularly of the smaller premiums. The whole collection of the premiums is done by the Post Office itself, and therefore a very heavy charge is taken off the shoulders of any office to whom that business is offered. The Post Office, however, found it not altogether an easy matter to find offices of a high class to undertake their business. I do not say they did not succeed. They succeeded at last; but their business was refused by the Sun, the Atlas, the National Provident, the Scottish Equitable, the Amicable, and the Rock. These are, I believe, all of them offices of a high class, and if they were not willing to take the Post Office assurance business up to £200, it is a very clear proof that business of this kind, I may fairly state, is of no value to offices which are considered of the highest class. I wish to show the manner in which business is transacted by offices of that class, and the reserves they think it necessary to hold in order to give themselves a secure position. I am only going to state two or three cases, but I certainly might multiply them without any difficulty to twenty, thirty, or forty. Now, in testing this matter, I am afraid I must make an appeal to the indulgence of the House, though I do not wish to trouble it with minute details, for nothing is more difficult or hopeless than the attempt to explain balance-sheets; indeed, I can only hope to make myself intelligible to those who have given particular attention to the business of Assurance Societies, and I see plenty of such before me and behind me. They will bear me out when I say that you know a good deal about the position of an Insurance Society when you get three things—first of all, its date; secondly, its income from premiums; and thirdly, its accumulations. From the relation of these three one to another, you know pretty clearly the state of any society. The Standard was founded in 1825, it has a premium income of £247,000 yearly, and it has accumulations of £2,133,000, or about nine years of its premium income. Of course, one will see that if these offices are really to do a business, they must live not on their capital, but on their business. Their capital is a proper reserve and guarantee, but they must live on their business. The amount of accumulations from their premiums is the fund laid up to meet death claims when they come in. I take next the University Life, and I am glad to pay a compliment to my own constituents, for I presume they take advantage of the benefits held out by that society. It was founded in 1825. The amount assured is £1 475,000; its premium income is £44,000; its accumulations from premiums, independent of £600,000 capital, are £780,000, or about seventeen years' income. Now I come to a younger society, the London and Provincial Law Society. It was founded in 1846. The amount assured is £1,500,000; its premium income, £46,000, and its accumulations £221,000. That is about five years' income, and I believe, for a society that has been established only eighteen years, it may be deemed very sufficient security. I take another, younger still — the Lancashire Society, founded in 1852. Its premium income is £23,500; its accumulations £85,600, or about four years' premium income—I believe relatively to its age, only twelve years, a very sufficient and satisfactory accumulation. I will now show to the House what is the sense of bodies of this description with regard to the proposal I now make. In doing so I will read a few lines from the speech officially transmitted to me by the manager of one of these first-class societies, called the Standard Life Assurance Society. The following is an extract from the speech of the Chairman made at the last annual meeting of the shareholders, an occasion when his sentiments might be fairly tested. He says— It has often been to myself and to the public a source of regret that the practice of life assurance was confined almost entirely to persons of what is called the better class; but the difficulty of forming any scheme which would convey the benefit to all classes was one which it seemed impossible to overcome, from various reasons connected with the carrying out of the practical details. I rejoice, however, to find that the Chancellor of the Exchequer has prepared a scheme on the part of the Government, which will surmount these difficulties. He proposes to grant assurances and deferred annuities of small amount in connection with the savings banks, on such a liberal footing as will put the advantages of assurance within the reach of all. I hail this measure as one of great importance, and I have no doubt that it will tend to promote still further the practice of life assurance throughout a higher class also, thus increasing, instead of diminishing, the prosperity of the life institutions of the country. Meanwhile let us rejoice that the means are to be afforded to the humbler classes to provide against the calamities which arise from old age and death, on a sound basis, for which Government will be responsible, instead of leaving them to the risk of expending their hard earned savings in supporting rashly instituted and badly conducted private schemes, which have so often failed them in the hour of need. And the manager in transmitting the passage says, "The directors believe that the views expressed by the Chairman are entertained by other societies in Scotland." I think, therefore, Sir, I have disposed sufficiently of the case of that class of societies—a comparatively easy part of my duty.

I come now to discharge a part of my duty which is much more painful; but the House will see that I am placed under necessity, not of my own creation. I did not court, I did not covet a discussion about the sufficiency of the arrangements of any one engaged in the business or commerce of the country. I should have been very glad to avoid a single reference to such matters. I will deal, however, with the subject as far as existing institutions, not Friendly Societies, are concerned, with as much reserve as I find possible. We come now to the consideration of what in assurance vocabulary is called, industrial business and minor Assurance Societies. Industrial business, the House will understand, is pretty clearly and broadly distinguished from assurance in general, the almost universal distinction being this— that industrial assurance depends on either monthly or weekly collections of premiums, whereas general assurance depends on either yearly, half-yearly, or quarterly collections. In speaking generally, and, with two exceptions, to which I will presently refer, the industrial business of the country is on a very small scale. I do not doubt that there are various excellent Assurance Societies doing industrial business —I do not question that; but if there are, they are societies that make no provision at all for the wants of the population at large. You may find an Assurance Society in this or that particular district that perhaps may answer the wants of the particular place, but what I have to look in the face is this—there are all over the country societies offering what I think insufficient securities, everywhere soliciting the people, not merely by placards on the wall, not merely by institutions in the towns and villages, but employing agents, whom I cannot call by any other name than preachers and denominational missionaries, who, animated by the golden vision of 25 per cent on the premiums paid, find their way into every cottage in the country and become eloquent and learned in the praise of the institutions to which they belong. But industrial business does not, generally speaking, reach the mass of the community. We must, therefore, consider something that does. Let me ask the House to consider, with regard to these good industrial societies— I do not question that there may be societies, acting simply as industrial societies, that are good and sound; but what cause have they to be afraid of Government competition? What can we do which will give us an unfair advantage over them? What is our condition? What can we offer, and what must we exact? In the first place, we give, certainly, very perfect security; and I must say, if that perfect security is a thing valued by the people, there is no reason why we should withhold it from them. There was a deputation that waited upon me, consisting of several gentlemen of the highest respectability, but chiefly from officers of a minor class. I urged on them that we were most innocent competitors. They dwelt very much on this consideration. They said, "The people are not aware of the advantages of assurance. It is absolutely necessary to go and persuade them individually into it. You must go to each house—you must reason, argue, and convince. That is the only way to make them assure." I answered, "If that be the only way, we won't make them assure; the House of Commons is not going to vote money to enable us to go into every cottage in the country for that purpose; therefore you are safe against us." "Oh, no," they said, "quite otherwise. Our agents will go into the cottages, and persuade the men that it is a good thing to assure, and directly our agents have persuaded them, the men will turn round on them and say, 'We are very much obliged to you, we will go and assure with the Government.'" That was, I must say, paying a very high compliment to the Government; but if that be so, it will be a hard thing to withhold this advantage from the people simply because they have a desire for it. I do not at all endorse the assertion. My opinion is, that the agents with the 25 or 15 per cent would, when they persuaded men to assure, take care where the assurance was effected. But, at any rate, we can offer perfect security; we can offer, and I think we ought to offer, much more favourable terms in the event of assurances being dropped, by the lapse of a few weeks or a quarter's subscription, than is now offered by these societies. There is another advantage in favour of the Government. In this country a considerable portion of the labouring population have become migratory. They go from place to place, seeking the best market for their labour. Wherever they go they know where to pay their premiums if they assure with the Government. That is an advantage which the Government possess, and it is a real recommendation of the Government plan. But I know of no other advantages that the Government possess, except that of offering perfect security, more favourable terms in case of the dropping of the policies, and greater facilities for the migratory portion of the population. All these are features which ought to recommend the Government plan to this House. But let us look to the disadvantages under which the Government labour. If the Government cannot employ these touting agents, it must re- main without the business which they would bring. If we are to provide liberal terms for those who drop their policies for a few weeks, or months, or a quarter, we must of course charge for that in the premium they are to pay. If this is to be done by the Government, it is plain it must be essentially a self-supporting business, because it is certain that this House will not, and ought not, to undertake it at a charge of one farthing to the public revenue. Therefore, if we are to offer terms of particular liberality to those who drop their policies we must charge that in the premiums, or else we cannot afford to pay them. Then, again, in competing with other societies, we cannot undertake to deal with children or young persons. That excludes at once more than one-half the lives which are commonly assured by the industrial societies. In many societies more than half the lives assured are those of young persons under sixteen. Lastly, let the House, and those who are afraid of illegitimate competition, take the case of a Government assurance, and of a good, sound, commercial company doing an industrial business. They are both dependent upon their premiums for meeting their engagements at the time of death, but mainly dependent, also, upon the use and judicious investment of those premiums. A good Assurance Company can invest their premiums, without the smallest risk or imprudence, at between 4 and 5 per cent. We cannot invest at that rate of interest. We work in fetters, and most properly so. It is impossible for the Legislature to grant to the Executive any discretion. We work within the narrowest limits defined by Parliamentary guarantee. We cannot invest at an average at more than 3¼ per cent, whereas those companies can safely invest at 4, 4½, and even sometimes at 5 per cent. If that is the case, it shows that nothing can induce the people to come to the Government except the facilities and conveniences we offer, and the perfect security we afford; but it is impossible, and it would be hypocritical on my part, as the organ of the Government, to pretend that we can offer to assure on terms that would be considered cheap in the market. If so, those fears of Government competition are fears that need not be entertained in quarters where prudence and honesty prevail. But prudence and honesty do not prevail in all quarters; and to those who tell me that this is to be considered as standing in the category of common commercial business, I would reply, "Consider for a moment the peculiar nature of life assurance." This is a business that presents the direct converse of ordinary commercial business. Ordinary commercial business, if legitimate, begins with a considerable investment of capital, and the profits follow, perhaps at a considerable distance. But here, on the contrary, you begin with receiving largely, and your liabilities are postponed to a distant date. Now, I dare say there are not many Members of this House who know to what an extraordinary extent this is true, and, therefore, to what an extraordinary extent the public are dependent on the prudence, the high honour, and the character of those concerned in the management of these institutions. When an institution of this kind is founded, so far from having difficulties at the outset, that is the time for its glory and enjoyment. The money comes rolling in, and the claims are at a distance, almost beyond the horizon. In the first year of the society the premiums far exceed the death claims. This is also the case in the subsequent years. For how long a period does the House think that the premiums to be received are in excess of the death claims? For thirty-seven years. That is to say, you found an institution which ought to be a very gospel of prudence, and the balance of its liabilities is postponed for one full generation of men. That is the peculiar condition of life assurance; and how does it operate when applied to the labouring class? How can you expect the labouring man to be a judge of the balance between assets and liabilities with regard to a society that is not practically to render an account for ten or twenty years? I am far from wishing it to be understood that, for a period of thirty-seven years in all these societies, the premiums exceed the liabilities. They at least exceed the expenses. I do not mean to say that where the expenses of management are kept within due limits, the period of thirty-seven years is the point to which I have referred. But the expenses of management have, in some cases, a tendency to grow beyond all bounds.

The House will probably like to know the fugitive character of these institutions. I will quote, as my authority, a little publication issued by the "Guardian," one of the first class offices. The very large number of Assurance Companies which either fail, or from other causes give up business, may be seen from the following table:— Summary of the formation and progress of assurance companies in the 19 years, 1844 to 1862 inclusive (from the Post Magazine Almanac, 1863). Number of companies projected, 596; founded, 276; ceased to exist, 259; amalgamations, 12. I wish I could read to the House a chapter on amalgamation; these are subjects of almost romantic interest. ["Hear!"] Transfers of business, 161. I think I hear a cheer from the lion, and learned Member for Wallingford (Mr. Malins), but what will he say when I read the next item—winding-up in Chancery, 57? The truth is that this is a subject which has both a comic and a tragic side. If we were to deal with the comic side, there are heroes who have figured in the police court and before the judicial authorities, some of them with "Reverend" affixed to their names, out of whose adventures I might weave a very entertaining narrative. But the tragic side is, I am sorry to say, altogether predominant, and I shall not attempt to relieve the dulness of a wearisome discussion by entering on matters that would give amusement to the House. I wish to show how matters stand with regard to the peculiar case of companies winding up in Chancery. In the first place, the policy holder has no remedy when a company is mismanaged, and for this plain reason, that he must wait until he dies. The fact is, that until he dies he has no claim that can be enforced. If this were a claim that could be enforced during life, we could imagine a combination of policy holders going into Chancery; but when we remember that the claim accrues only on death, and when we consider the condition, on the death of the policy holder, of those scattered families which have sustained the loss of their head, we see at once that the position of the policy holder is almost one of entire helplessness. When it happens that one of these concerns finds the fatal day arrive, and that it can no longer meet the claims of old assurances by the premiums of new customers, it does sometimes happen that it gets into Chancery. But what is the condition of the policy holders in Chancery? I do not mean to find fault with the proceedings of that Court, which may, for anything I know, be perfect; but it is obvious that directly a man hears that a company in which he is assured has gone into Chancery, he feels naturally scrupulous about what is commonly called throwing good money after bad. Practi- cally, the policy holder ceases to pay any more premiums, and, therefore, he loses his claim to that which he has already paid. That is a plain, unvarnished description of what takes place.

There is another form of proceeding. I refer to matters of amalgamation. I am sorry I am not able to open up all the mysteries of amalgamation, but this is a case which has been communicated to me upon the best authority. Suppose a person of small means, who is assured in a particular society, hears that it is going to amalgamate. What can he do? By what possibility can he make out a case against the amalgamation? How can he bear the cost of bringing the company to book with the uncertainty of proving that the amalgamation ought not to be allowed? He cannot resist an amalgamation. What, then, is done? There are intermediate agents, gentlemen who kindly go round and say, "Oh, you had better amalgamate," and suggest terms. A remarkable instance of amalgamation took place between the "Professional" and the "European." The "Professional" transferred its business to the other society, and what did the "European" do to make itself safe? Certain policies were paid in the "Professional," and they were of a certain value. But there was a liability upon them, and the "European" made it a condition of receiving the transfer that the amount of the remaining liability should be inscribed upon each policy. Supposing there was a policy for £1,000, and the outstanding value of it was£600, the "European" wrote £600 upon the back, and charged 4 per cent interest on it, and on the death of the policy holder, the £600, with interest, was to be deducted from the £1,000. Such were the terms upon which those amalgamations took place. That is an illustration of what you will probably say is no better than wholesale robbery. Nay, more, I will go a step further, and say that a great many of those proceedings are worse than wholesale robbery, and there are many persons who have never seen the inside of a gaol, and yet who had fitter be there than many a rogue that has been convicted ten times over at the Old Bailey.

I now pass on from these considerations to deal with particular cases. I am not going to present you with cases of societies which have been guilty of actual fraud, but I wish to allude to two cases of societies which do an industrial business on a large scale. And here I feel a particular restraint with respect to any comments I may make, but I think I am justified in looking at the published accounts of any society, and making any comments which its figures may suggest. There are two societies called the "Friend in Need" and the "British Prudential." The "Friend in Need" was born as a Friendly Society, but the chrysalis passed into a butterfly, and came out as an Assurance Society. I am not sure of the date when the society was founded, but it must be of considerable age. Its income was £22,000, and its available assets £14,000. And now I will quote a few words from the evidence of an eminent actuary who was examined before Mr. Wilson's Committee. Mr. Ingall, the actuary of the Imperial, stated that "if the accounts of a company which had been fourteen years in existence showed that the available assets amounted only to one year's actual income, there could be no doubt of the unsafe position of that society." And when I submitted that reply to another distinguished actuary, Mr. Tucker, he said there was not the smallest doubt of the truth of that proposition. Now, the position of the assured is, in one respect, very painful. It is well known that disputes very often arise upon a death as to the liability of the society— I am speaking now of societies of a secondary class — and for these disputes arbitration is the common remedy. Mind, we are now dealing with institutions which have branches and agents all over the country. They are not such as you can localize. They are here, there, and everywhere. In the case of this "Friend in Need Society," the condition of arbitration is that it shall be in London. Think of what the meaning of these few words are to the mechanic, clerk, or working man, who may be in Scotland, Ireland, or anywhere else, on finding that his little policy of £20 depends upon an arbitration to be held in London. It is confiscation united with concealment. The case of the "British Prudential Society" is a remarkable one. It is conducted by Mr. Harben, a gentleman of great energy, and it is owing to Mr. Harben, I understand, that there is an organized opposition to this Bill. Hon. Gentlemen opposite will well understand what is meant by an organized opposition. Mr. Harben waited upon me some ten days ago, as one of a deputation on the subject of this measure. I inquired from him whether the society to which he belonged had any objection to the publication of their accounts. His reply was "Oh dear! no. I am extremely anxious for their publication." Subsequently when sending the accounts, he said, "These are to be for private use." I replied I did not need them for private but for public use; and then Mr. Harben said, "If all the others publish I have no objection. But as all the others do not publish, I would rather not, inasmuch as I think the facts I have given you might be the subject of unfavourable comment, of course owing to defective knowledge." I can only refer them to the balance sheet of the "British Prudential" for 1861, which has been published, and its policy account at first sight would appear rather remarkable. The debit on that account is £518,000, while the credit is £582,000. That is a most singular state of things, because the policies on which the society has received a very large sum, and therefore incurred heavy liabilities, are represented as being in themselves assets of greater value than the whole liabilities. The debit is the present value of the whole sum assured, and the credit, by some method not, I think, easily intelligible, is actually made into assets. But, to put it in another way, while the premiums were £52,000, the assets were £46,000. There was unpaid capital besides the assets, and it is not for me to dispute that the shareholders may be able to pay, but what we are speaking of is whether the transactions of the institution pay or not. The result of that balance sheet is this. As it stands it presents a balance of £41,000 in favour of the society; but it has been examined by actuaries, and those gentlemen, proceeding upon principles which are no more open to question than a proposition of Euclid, say, that instead of a balance of £41,000 in favour of, there is one of £30,000 against the society. There was, it is true, a capital of £45,000 not paid up, and which if paid up would undoubtedly more than liquidate this balance; but all I can say is, that in 1861, when its balance sheet was published, it did not appear to be in contemplation to demand that it should be paid up, and the accounts stood as I have said. I am not going to push this further than to say, that it is not just that societies in this condition should come forward and say, "We admit that the great Assurance Offices do not do the business that the Friendly Societies do, nor do it in a satisfactory way, but leave it to us and we shall do it." I decline to accede to that proposition, I demur to it. I do not feel satisfied as to the business the "British Prudential" is doing. I will now give the House some particulars of the case of an extinct society, or one of those fifty-seven victims of time and circumstances which are winding up in Chancery. I mean the "British Provident Society." I quote this the more freely, because I wish to be corrected if the circumstances I am about to mention should be inaccurately given. It was founded in 1851 and carried on business for eleven years, and only for three of those years did it register its accounts as required by law. These were the years from 1853 to 1856. The income of the society during those three years was £10,600. Notwithstanding the advantageous circumstances I have mentioned about the receipts coming before the liabilities, the expenses during those three years were £15,700. Perhaps it might be matter of interest to the House to know that Mr. Ansell, one of the most eminent authorities among actuaries, states (speaking of a number of societies) that the expenses for the first five years of their existence are about 13 per cent, of the receipts. That he considers a just and fair allowance. In the case I have just quoted the expenses were about 150 per cent; for the assets were £10,600, and the expenses £15,700. Of course, it was necessary that the society should be brought to book and called on to make provision from the resources of the shareholders for the demands of their policy holders. The society was in Chancery in 1862. An action was brought against the manager of the society for interpolating words in a deed which altered its character after execution. In the deed, which purported to be a sale to the manager, words were interpolated making it a sale to the manager on behalf of the society, the effect of which was to make the vendor still liable for outstanding calls. The case was afterwards tried by a jury in Chancery, and I find from the Insurance Gazette, that the jury, after a short consultation, unanimously decided that two interlineations had been made in the deed after execution. The Vice Chancellor said that the public were indebted to the jury for the patience and intelligence they had shown in the investigation of the case, and he might add that he had no reason to be dissatisfied with the verdict. The House will understand why I have said that I am very anxious to have it understood that I state those things as I gather them from public records, and not from private information and personal knowledge, when I inform it that the manager of that society was John Sheridan, and the name of Henry Brinsley Sheridan appears in the advertisement of 1856 as auditor of the society, and in 1859 as trustee of the society. The latter is the name, I believe, of the hon. Member for Dudley, but whether he be the gentleman referred to in the advertisement I do not know; but, if he were, I have no doubt that he is in a situation to make a most satisfactory explanation to the House on the subject.

I come to the last part of this most painful portion of the business, and that is to touch on the composition and action of certain Friendly Societies. Those Friendly Societies are no less than 20,000, as far as regards those registered, but a large number are unregistered, making up, as I am told upon conjecture, the number to 30,000. Since the Friendly Societies' Act passed, from 8,000 to 9,000 of them have failed. Now, what I wish to point out is, that these are not societies acting by the ordinary powers of Englishmen, but are societies under the provisions of a law constructed for the purpose, and under the favour of a statute amounting to positive bounty and virtual endowment, and yet a great number have been unable to meet their engagements, and those who subscribed to them have suffered loss with respect to the contributions which they made. When I add that each of those 8,000 or 9,000 Friendly Societies had its members in scores, hundreds, and even in thousands, and that those members were almost exclusively of the labouring class, I leave the House to judge what is the real meaning of the words "unable to meet their engagements." About 100 of these societies fail every year. I now wish to call the attention of the House to the subject of what is styled lapsed policies. Almost all the life assurances made by the labouring class are made when they are comparatively young: the elderly man does not insure; he cannot afford it; he is past his prime, and the payment upon assurance grows rapidly in such cases. They therefore insure while they are young, or not at all, and the covenant made with them is of the most severe description. You preach to them about prudence and about the duty of providing for those they leave behind, and yet a covenant is made with them, by which an intermission of a few weeks in their payments, after they have paid for ten, twenty, or thirty years, deprives them of their policy. Are these fair terms to make? I do not say they constitute an indictable offence, but such terms are thought too severe for the higher classes; and in their cases some allowance is made for the vicissitudes of life. The arrangement is that, among the higher classes, a holder of a policy who is unable to continue his payments has a certain proportion, generally about one-third of his premiums, repaid to him; but no such right is conceded in the case to the industrial classes. Now, is this lapsing of policies a token of improvidence on the part of the labourer? How can any labouring man answer for payments throughout every week or every quarter of his life. He has no guarantee against want of employment, sickness, the duty of providing for an aged and decrepid parent, or extending generous aid to a friend, or any other of the ten thousand inevitable calamities to which they are subject. If the poor man fails in any such case—not to speak of imprudences or kindred errors — to pay one premium the policy drops, and he loses everything he has paid. I confess I think that that is a very harsh arrangement, and that, unless there are fundamental objections of a very practical character, it is exceedingly necessary to afford to the labouring man some fair prospect of insuring his life without the fearful penalty to which he is subjected in the event of a temporary intermission. Has the House the smallest idea of the number of these lapsed policies? Had I not had it in positive figures I could not have believed it. It will appear a strange relation to those who hear me when I state, that the number of these lapsed policies in the Friend in Need Society during five years was 18,000, out of 86,000 policies made. Thus 18,000 men who had insured their lives and paid for a certain time lost the whole benefit of their money. The Royal Liver Society issued 135,000 policies last year, and had in the same time 70,000 lapsed policies. That society has a rule authorizing the committee of management to grant to the widow or relative of any member dying, who from being out of employment, or from sickness, had previously made an intermission in his payments, a sum not exceeding £5. That discretion is left them; but I am not aware how far it has been acted on. The policy holder, however, has no right whatever in the case of the policy lapsing to demand any repayment. This is hardly a right state of things with respect to societies which virtually receive a bounty and subsidy from Parliament. The notion that these societies are self-governing makes them acceptable to many persons. Thousands of men all over England are invited to enrol themselves in them, are dignified on the payment of a certain sum with the name of members, and are then told that this is the principle of self-association, and that they have the power to direct their own affairs. I decline to give the smallest value to the allegation. Do not let it be supposed that I am speaking of Friendly Societies that are merely local, or of those that have thriven and prospered under the benevolent auspices of the right hon. Gentleman the Member for North Wiltshire (Mr. Sotheron Estcourt), societies which are filling the true intention of the law, which, wisely or unwisely, was to give encouragement to institutions of that character; but it is a perfect mockery to send agents with 12 per cent or 15 per cent or 20 per cent commission all over the country, to take down the names of members in every cottage, while twenty or thirty persons meet in London and manage the concern, at the same time to say that the shareholders may, if they choose, come up to London and set right their affairs. I am exceedingly desirous to have it understood that I am not making a general assault on Friendly Societies. Nothing is more satisfactory or congenial; nothing more harmonizes with the best English ideas than to see men of the labouring classes associating together in the true and real spirit of golf-government for the purpose of providing against the contingencies of old age, sickness, and death; and on societies of such a sacred character I would not lay a finger. But I am told that the rigid rules of arithmetic bear hard upon some of these societies, and show that the small number of their members acts as a difficulty in equalizing their risks, and that although their expenses may be moderate their casualties are many, and that after a time they come to an untimely death. I cherish the belief, however, that there are many societies in that happy mean that, without any extraordinary attempt at self-propagation over the whole country, are able to discharge their duty, and, at the same time, to pay their debts. But, seeing the multitude of evils and abuses which are thriving in rank luxuriance, I must say I do not think we could hold our hand; and if there is to be any responsibility for saying "We will look on but will do nothing," that responsibility shall not rest upon the executive Government, but must rest with the representatives of the people in Parliament. We all know with regard to these Friendly Societies, how difficult it is to keep them out of harm's way—we know how apt they are to meet at public-houses, and how much of their funds are liable to be expended there. We know what grave oppression is practised upon minorities who object to such arrangements; how impossible it is for minorities to resist, and how that principle of tyranny among the working classes of one portion over another—that great reproach, which still adheres to those classes, is fostered and encouraged. I read this morning with some interest the account in the Standard of a meeting held on Saturday night at Exeter Hall of working men for the purpose of opposing this Bill. It will not be disputed for a moment that it was an organized meeting, that it was got up by men who think they have a direct interest in resisting this Bill; and I admit that if they belong to societies such as some of those I have described, they may J have such interest in opposing this Bill. But it does seem that a pretty sturdy opposition to the object of the meeting presented itself, not prompted by any external agency, which produced a considerable uproar, such as Englishmen so assembled generally contrive to settle their business in. The chairman was a Mr. George Potter. I believe that is a very well known name. Is it not the Mr. George Potter who is the far-famed secretary of the trades' unions? and is not the principle of those trades' unions, which if of voluntary association are perfectly and in the highest sense legitimate, and which would give to the labouring man his fair right of self-defence against capital—is there not, unfortunately, among the great body of these trades' unions a principle of coercion applied to the minority? If that be the ease, then Mr. George Potter was in his place on Saturday, because it is the business of these societies in some way to coerce often minorities, but sometimes even majorities, through the medium of an artfully constructed system, which, pretending to consult the individual will of the mem- bers, in fact deprives them of all free agency. I will not trouble the House at much greater length, and must apologize for the time I have already occupied.

I must, however, just state the condition of two societies of some standing. One is the Liverpool United Loyal Friendly Burial Society, which was enrolled in 1843, and, therefore, being now just of age, has had ample time to consider its ways, and may fairly be called upon to give an account of its doings. The income of that society for premiums is £10,130, and the capital accumulated after twenty-one years' existence, according to their own printed statement, is £3,900. The next case is that of the Royal Liver, which is fourteen years old; the society, I think, which issued 135,000 policies last year. Its income for premiums is £77,000, and what does the House suppose to be the expense of managing, raising, and dealing with that amount —£36,000. With an income of £77,000 the accumulated capital after fourteen years' business, according to their own balance sheet, is £39,000. The managers of this society came to me on Saturday to remonstrate against this Bill, and they said it was a hard thing to interfere with private enterprize. They proposed a rival plan. I begged them to let me have that plan in writing, which they promised to send, but I have not yet received it. I will, however, state the outline of it as they stated it to me, and the hon. Members for Liverpool and South Lancashire can correct me if I mistake. By this plan the Government were to appoint actuaries, and these actuaries were to examine the rules, tables, accounts, and transactions of all Friendly Societies. Now, one objection that has been taken to this Bill is, that it creates Government patronage; but certainly such a golden prospect of Government patronage as was opened by this suggestion from the quarter of the Opposition, that the Government should appoint actuaries to examine into the condition and transaction of the 20,000, or 30,000 Friendly Societies in this country, never dawned on the imagination of any Minister. But it was gravely and positively stated to me, that officers so appointed should go through all the transactions of all these societies, and that was the plan I was recommended to substitute for my own. Just imagine myself standing in this House, and on behalf of the Government—if any Government could ever be found out of Bedlam to sanction such a proposal—asking the House to assent to a proposition giving the Government power to appoint officers, who, acting as their agents and organs, should look through the concerns of more than 20,000 societies. But if such officers were appointed, it must be for some practical purpose, and not merely to satisfy certain formal conditions; and when I said, "If they are only to look at the rules and tables, they will have nothing to do with the mode of appropriating the funds;" to this I was answered, "Oh, they will look into them, too." "They are to look into the solvency of the societies?" I asked. "Oh, yes," was the answer; "but recollect, we only speak for our two societies, and not for the other 19,000 and odd." "Well," I said, "what will be the effect of examination by a Government officer if it should unfortunately appear that any society was insolvent?" "In that case," they said, "the officer should propose rules to make them solvent." [Laughter.] I do not wonder that there is a tendency to smile at such a proposition; for if the Government is to appoint officers, who, finding any societies insolvent, should propose rules to make them solvent, we must go a step further with such a blessed invention, which surpasses steam, telegraph, and the penny post. It must be extended to all mankind; it must be applied in the Bankruptcy Court; and when a gentleman or a society of any kind finds himself or itself in the unfortunate condition of insolvency, instead of driving them to harsh and disagreeable extremities, rules ought to be suggested to make them solvent. That was the proposal made to me on Saturday; and now I must notice the proposal of the hon. Member for Hertford (Sir Minto Farquhar), which, if adopted, I think can only be productive of mischief. In the first place, if a Committee was to do its duty by examining fully into these matters, it would be obliged to go further than I have gone. As I have stated, I have had no private information. I have proceeded solely upon public documents which are accessible to all the world; but exposure of all these concerns, among which I cannot tell what proportion are solvent and what proportion are insolvent, would involve, in my opinion, an amount of responsibility which the House ought not lightly to incur. It might be all very well that you should, in a free-and-easy-manner, expose all these things, if you had no one to deal with but the managers, secretaries, auditors, and trustees; but you must remember that you have to deal with the immense mass of the labouring classes throughout the country. That which led us to believe we should adopt some mild measure of gradual operation, such as I have now proposed, was mainly an apprehension of the enormous mischief that would be done if a sudden alarm were to be spread throughout these bodies, amounting in the case of Friendly Societies to a million and a half of persons, besides several hundred thousands attached to other societies. Sir, I disclaim that responsibility. I am aware of no manner in which the compulsory regulation of these society can be undertaken by Parliament. I deprecate the delay which must ensue if the House should refer this subject to a Committee; and I renounce all responsibility for the exposure that would follow. I deeply regret that I, myself, have this evening been compelled to enter so far into details as I have done, and I have only entered into these details because I knew the House of Commons would demand a full explanation of the motives for this measure. Therefore I entirely deprecate the Motion of the hon. Gentleman opposite, and I trust that he will either meet us with a fair negative, propose a plan of his own, or give us his assent to this Bill. I am not aware of any mode of proceeding which, as compared with that which I now submit to the House, is not fraught with ten times greater evils, and which would not inflict the additional mischiefs of delay and uncertainty. I regret that I have been compelled to make so lengthy a statement; and I would now simply remind the House of what I have endeavoured to prove. I have endeavoured to prove that Parliament by legislation—not by the mere fact that it has assented to life assurance, but by its legislation in respect of Friendly Societies, and the many boons it has conferred upon them—is seriously compromised and responsible for the present state of things, and is bound to do what it believes to be best to mitigate the evils of that state of things. I have endeavoured to show that the plan which I propose, if it does compete with sound institutions, must so compete with them at a disadvantage from the essential conditions under which it is right and proper we must work. I have endeavoured to show that the wide field of the labouring classes is not occupied by sound institutions —nay, that it is not fully occupied even by sound and unsound institutions, such is the enormous breadth of the subject. I have shown, I think, that the present condition of many of these Friendly Societies —indeed, I might go further and, speaking generally, might say, that the present condition of these societies is more or less unsatisfactory. Some of them we cannot call merely unsatisfactory, but must term them either rotten or fraudulent. It is impossible for the State to assume the direction and regulation of these societies so as o secure in the management of their affairs a safe method of assurance; and what we propose is, we believe, the most prudent, the safest, and the most satisfactory mode of proceeding that can be adopted. I make my appeal not to any one class or to any party. I forget that I am a member of the Government, except so far as regards my responsibility as such. I recollect the sacred trust we have in hand, and I entreat hon. Members to keep in view the serious nature of that trust, the importance of the object, and the consequence involved, and I am certain they will not be prevented by any sentiment of political or party feeling, or of hostility to the Government, from giving their careful consideration to this question, and from determining in their own minds and hearts how the British Legislature can best acquit itself of this important part of its obligations to the mass of the people of England.

MR. H. B. SHERIDAN

said, that after the speech of the right hon. Gentleman he should be compelled to divide the House. The attacks which the right hon. Gentleman had made, not only upon him, but upon many respectable Life Assurance Societies, rendered it absolutely necessary that the debate should be adjourned to a future day, when the friends of those societies might be enabled to reply to the accusations which he had, without notice, brought against them. The speech of the right hon. Gentleman was, from first to last, not a defence or even an explanation of his Bill, but simply an attack upon certain offices, very much upon the principle of the old instructions to counsel, "Having no case, abuse the defendant's attorney." Without notice to him (Mr. Sheridan) the right hon. Gentleman had singled him out for attack, while making, as he supposed, a general exposure of Life Assurance Institutions, but he was not to be deterred by that from doing his duty in that House. The right hon. Gentleman had referred to an institution of that kind of which he (Mr. Sheridan) was either auditor or trustee. Now, he was trustee of a great many of these institutions, but he did not consider that he thereby made himself responsible for their financial condition. Only last week he had received a letter from a person who made an inquiry upon this point respecting one of these institutions, and he wrote back stating that he knew nothing of its financial condition, and was not in any way answerable for it. As to the office to which the right hon. Gentleman had alluded, it was one in which he was a shareholder, but from which he had derived no advantage in any respect. Already he had paid £1,800 on his shares; he had lately agreed to pay £1,500 more; and if there was any disgrace in paying that amount without receiving in return any advantage, pecuniary or otherwise, then he was amenable to the right hon. Gentleman's strictures. If, however, no disgrace attached to him in that respect, then the right hon. Gentleman had no right in defending this measure to come down to that House, and, without notice, attempt to deter him from opposing the Bill by a gross personal attack. The office to which the right hon. Gentleman had referred would not come under the category of offices mentioned by him that had not paid their policy holders, for the policies were transferred to another office, and it was only after that transfer, and after every attention had been paid to the interests of the policy holders, that the shareholders had to settle their disputes in the Court of Chancery, and he, to his misfortune, had to pay some £3,400 for his incautious alliance with the institution. He hoped his explanation would be satisfactory to the House. As to the right hon. Gentleman's statement respecting policies of insurance, in the whole instance of life insurance, covering now a period of 180 years—during which millions had been paid in the shape of claims, and these companies had transacted their business with unfailing rectitude—there were not more than two or three instances in which the policy holders had lost the sums they invested. The right hon. Gentleman had asked how it was that in the balance-sheets of these institutions the liabilities on policies could be taken as assets. Why, the merest tyro in actuarial science could have told him it was a necessary consequence of the theory of probabilities and the doctrine of chances. Supposing an office had been in existence three or four years, and was in receipt of £8,000 or £10,000 a year from insurers, it had a right to place to its credit a certain sum, based on the estimated duration of life of the persons insured. It must not be assumed that those persons were going to die immediately, and pay no more premiums, or that all profit from that source was exhausted. The valuation of these lives was made by an actuary, and it very often happened, if the office was a young office, that the balance was in its favour. He was only looking the other day at the accounts of an office which had been investigated by Professor De Morgan, who had brought in a balance under that head in favour of the institution. These life risks were not to fall in a month or in a year. They would be spread over a long period of time, and the figures representing the aggregate risk must not be taken as representing a direct and immediate responsibility. Moreover, the character of the liability depended on many special considerations—whether, for instance, there were Indian risks, or diseased lives, or whether it was a loan business— these things entered largely into the calculations of all actuaries, and must affect the principle laid down by the Chancellor of the Exchequer. The right hon. Gentleman had taken a most improper course in publicly assailing the respectability and insolvency of life assurance companies, and sending through the country statements most unfounded and calumnious as regarded the position of those companies. He (Mr. Sheridan) was not interested in any of them, but upon every principle of fairness he deprecated such attacks.

With regard to the Bill, it was first announced as the Government Annuity Bill, not a word about life assurance being mentioned, not a word appearing on the face of the Bill to show that it was intended to open a large national establishment for the transaction of life insurance. This was certainly not an instance of the frankness which the right hon. Gentleman extolled. Now, if it were necessary some years ago to associate a Government, annuity with a life assurance in order to guard against fraud or against bad lives, how was it that that necessity had ceased to exist? He had listened in vain for one argument in support of the proposition in the vituperative speech of the right hon. Gentleman. Mr. Wilson distinctly stated, that although the Government wished to associate life assurances with annuities for a protective pur- pose, it was not their intention to transact life assurance business. How soon the successors of the right hon. Gentleman had forgotten that declaration. He was willing to believe all the Chancellor of the Exchequer had said about his own excellent intentions. He had no doubt that he did not, at first, intend to trespass on the legitimate domain of the Insurance Societies, and that his aim merely was to benefit the working man, by enabling him to make secure provision for his old age or the maintenance of his family after his death. Yet, it was surely most unfortunate, if the intentions of the Government were so pure and honourable, that the Bill was hurried on as it had been. The eagerness with which it had been pressed forward certainly excited a suspicion that the Government were anxious to get it through before the opposition to it was fairly roused. He regretted that the right hon. Gentleman did not fix an evening for a full and deliberate debate on this grave question, when all interested in it could have had an opportunity of stating their views. He could not but think that it was a most objectionable Bill. It was an invasion of the rights of Life Assurance Societies, and a violation of the promise formerly made by Mr. Wilson on behalf of the Government. Such a proceeding ought not to be tolerated by the House. What security had they that the present Chancellor of the Exchequer on some future occasion, or his successor, might not attempt to pass beyond the limits proposed, and rise from £100 to £300 or £400 insurances? The secretary of an Insurance Office had brought under his notice a case which illustrated the tendency of the measure. A gentleman in the country had been in treaty with the office for a life assurance to the amount of £1,000, but no sooner did he hear of the Government plan than he declined to go on with the transaction. He said that, "without disparagement to the office in question, he preferred the security of the Government," and when the secretary told him that the Government could not meet his views, as they were not going to grant assurances over £100, he replied, "Oh, yes; but if they find it answers you may be sure they will do away with such restrictions; at any rate, I'll wait and see." He had no doubt that the idea of the present scheme was suggested to the right hon. Gentleman by the successful operation of the Post Office savings banks. It should, however, be borne in mind that all these banks had to do was to receive money and to be answerable for its safe return. They gave the lowest possible interest; they required no expensive agency or machinery, no elaborate system of accounts. Life assurance was a very different affair. In that case the Government would receive small sums of money in order to return large sums at a future day. An insurer might die next week, and the Government would have to pay on his policy. The money received must be put out so as to gain a good rate of interest, 4 or 5 per cent, in order to make the transaction profitable. In fact, the Post Office savings banks were pure trust, but the new assurance system would be pure trade. It had always been a favourite scheme of Finance Ministers to reduce or extinguish the National Debt by means of annuities. When £100 of stock was received and invested in the hands of the National Debt Commissioners, the interest paid being only a trifle more than the interest of the debt, the operation was a very good one for the country. But even that had been found to work not altogether well, and Mr. Finlayson had prepared a new table of mortalities. It was based on select lives, for people had been brought from the most healthy parts of the country in order that annuities might he taken out on their lives, and combined the lowest rate of mortality with the lowest rate of interest. Life assurance, however, instead of diminishing, would tend to increase the debt. Every small premium paid in would add immensely to the new debt, which would continually be growing. The expenses of the establishment, losses, and frauds would swallow up a large proportion of the receipts, and in the end they would find themselves saddled with heavy obligations. The late Sir Robert Peel was supported by public opinion when he laid it down as a rule, that the Government ought not to enter into competition with private traders, and he must own he was much surprised to find the name of Mr. Peel on the back of a Bill which involved so gross a violation of the principle his father had enunciated. They all knew that Government interference of this sort ended in monopoly, and the experience of the evils of monopoly in our past history ought to make the British people very cautious of countenancing a repetition of such abuses. The right hon. Gentleman declared that there were no existing facilities for small insurances, and that there were only three or four offices which gave attention to that class of business. There was no foundation for such statements. The right hon. Gentleman had been told, on the high authority of practical men, that a large percentage of the new insurance business consisted of policies under £100. The abuse which the right hon. Gentleman had levelled at particular offices, which he thought he might safely vilify, he had not attempted to throw upon those larger institutions, such as the Eagle or the Guardian, which he fancied it might be dangerous to meddle with. The right hon. Gentleman asserted that there were no facilities. Why, he had in his possession a statement which, in candour, he ought to have read to the House, showing the amount of business of the particular class he referred to, which was actually done in the different offices at the present moment. A memorial had been handed to him, signed by seventy of those offices which he had since denounced, and with whose affairs he was about to meddle—ho hoped not to muddle—showing that their investments amounted to £100,000,000, and the amount assured to £300,000,000. The new assurances alone were increasing at the rate of £30,000,000 yearly—a fact which was well worth the attention of the House in its possible bearing upon the National Debt hereafter. A statement had also been handed to the right hon. Gentleman, from which it appeared that there were six offices which had issued 29,970 policies, the amount assured being £2,500,000, and whose premiums for policies of less than £100, issued in less than three years, amounted to £502,000. Moreover, Mr. Jellicoe and the other eminent men who attended the deputation apprised the right hon. Gentleman that the tendency of the public mind was to insure in small sums, and the tabular statement handed to the Chancellor of the Exchequer showed the enormous number of these £100 policies issued by many of the offices. In the British Empire there was a large number of these small insurances, as there was also in the British Mutual. The Provident Clerks had issued a thousand policies of £100 each to Post Office officials alone. The Law Union, the Sovereign, the Norwich Union, and the Reliance would also be affected by this Bill. The British Prudential, he believed, had issued £100 policies to the amount of not less than £170,000. The opinion of the most eminent actuaries, to whom the right hon. Gentleman had referred, was adverse to the scheme. Mr. Jellicoe expressed a hope that, for the sake of the country, the House would not pass the Bill, especially as it related to deferred annuities, and added that it would not effect the object which the right hon. Gentleman had in view. Mr. Brown said that there was no great desire on the part of the labouring classes to avail themselves of the benefits of life insurance, and that the Government should give them more time to consider the question. The right hon. Gentleman wished to introduce this sweeping change in the interests, he said, of the working classes. But it had been pointed out to him by some of the most eminent actuaries of the day that he must do one of three things. Either he must charge rates equal to or higher than those already in force, in which case he must relinquish the idea of benefiting the humbler grades of the population; or else, by adopting a lower scale, he must run the risk of having some day to appeal to the country to make good the 'deficiency. When asked, who was to bear the risk of loss, the Chancellor of the Exchequer said, "I do not think I need answer that question." Business was looked for from the labouring classes; but with that section of the population at present very little desire to become insurers was manifested, and the agency fees necessary, on the one hand, to stimulate business in such a quarter, and, on the other, to protect the Government from fraud, would be much higher than the right hon. Gentleman was prepared for. He contended, indeed, that the necessary machinery was already in existence; but it was one thing to receive small sums of money for investment in the savings banks, and another to conduct all the multifarious business of an insurance office. Would it be possible for the postmaster and postmistress, having other duties to perform, to inquire into the character and life of the applicant, to send out the necessary correspondence, to communicate with the medical man, to arrange for the policy, the receipt of the premiums, and when death supervened, to establish the identity and negotiate with the undertaker. It was necessary to do all this, for it had been proved, beyond doubt, that the friendly societies advanced half the expenses of burial. The right hon. Gentleman, when questioned upon those points, said that there would be responsible officers in the metropolis, and that the Poor Law Board would lend its assistance. The business of life assurance, however, required not a casual and intermittent attention, but a scrupulous accuracy and attention to detail, and unless the Government watched every point narrowly, and created an army of placeholders, it would be impossible to carry out the objects of the Bill without great loss to the country. What could be the motives sufficiently powerful to induce the right hon. Gentleman to enter the lists with institutions having 75,000 trained and skilled agents, capable of carrying out instructions from head-quarters, and fully alive to all the exigencies of their particular trade; and further, to compete with 20,000 friendly societies, having, according to Mr. Tidd Pratt, 3,000,000 of members? The motive might be a friendly one, but the procedure was Russian in its character— order achieved through destruction. Mr. Tidd Pratt proved that the great weakness of the Friendly Societies lay in their deficient rates and the frequent sickness of their members; the only valuable item in their system was the life assurance. The right hon. Gentleman did not propose to cure the evils, but subtracted the single element of strength. The effect of his proposal would be to break up and destroy these 20,000 societies, no compensation whatever being provided. And as the new Government scheme would only attract the best lives, those who had been paying contributions for many years to the old societies, when sickness and infirmity came upon them, would find themselves deprived of the support upon which they had calculated. It might be fairly asked, admitting the evils which the right hon. Gentleman had described, what course was open to the Government? A very simple one. Instead of the present delusive S3'stem, under which Mr. Tidd Pratt certified that the rules of the societies were in accordance with the Act of Parliament, leading poor people to believe that the whole affair was conducted under Government supervision, let an honest and thorough system of Government control be exercised. Let them withdraw the present Bill, and let the rates of those societies be submitted to competent actuaries, and a proper system of accounts be insisted on. That would secure the removal of the abuses which were complained of; but to destroy the societies in order to remedy their defects was a step which was as unusual as it was unnecessary. Nor was it fair that the right hon. Gentleman should attack individuals who were opposed to his measure, or exhibit the balance sheets of offices as showing a deficiency of assets, or make statements for which, if made anywhere else, he would be answerable. The right hon. Gentleman was not a sufficiently good actuary to be able in that off-hand and cursory manner to test the sufficiency of accounts of so complicated a character. If this measure were passed, the Government must, eventually, be losers. They might shut their eyes for a time, but they would ultimately have to come to that House with shame and with something of humiliation to confess that their experiment in commerce had failed, and that the result had been to saddle the shareholders with a loss—those shareholders being the already overburdened taxpayers of the country.

LORD STANLEY

Sir, I cordially approve the principle upon which this Bill is based, and it is because I do so that I venture to appeal to the right hon. Gentleman the Chancellor of the Exchequer to give us time fully to consider it. It is a great experiment. It may be a great step towards the reduction of pauperism, and may lead to most important results as regards the future of the labouring class of this country, and, precisely because it is a great experiment, I, for one, should the more regret to see it marred by any haste or want of consideration of those details on which its whole working must depend. The right hon. Gentleman said, at the beginning of his statement, that the Bill had been before us ever since the first day of the Session. That is perfectly true; but, on the other hand, it is only fair to remind him that, though we have had the Bill before us for something like six weeks, we have only had the explanation of the Bill, the explanation which only its author could give, for about two hours. Up to this evening all the knowledge which we had of the Bill, beyond the actual reading of it, came from the statements of those who were opposed to it. I think, also, that we should bear this in mind. The right hon. Gentleman has delivered an address which contained much matter for consideration— many things which were novel, even to those who had looked a little into the subject, and who thought that they had acquired some slight knowledge of it. But he has done more than that; he has made statements which, however true they may be—and I am afraid that there is a great deal of truth in them—I wish I did not think so—however true they may be, do nevertheless seriously inculpate the management of a great number of public bodies in this country. Now, I am not standing here to speak on their behalf, but they have a right to fair play. Now, such of them as have an answer will desire to have that answer given in this House, and there will be no opportunity on which it can be given except while this Bill is under discussion. I sincerely hope that, whatever we do, we shall not come to a division upon this very important question of time. I should very much regret that, because I think it would create out of doors a very false impression as to the feeling and temper of the House. There are one or two points connected with the measure on which I confess I hoped to have heard a rather fuller explanation from the Chancellor of the Exchequer, and though he has no reply, I will name them briefly, in order that they may be considered when we go into Committee. I, for one, am not inclined to attach much importance to- the vested rights, or what are called the vested rights, of the Insurance Offices or the Friendly Societies. I think upon those points Government have made out a good case; but I do feel some apprehension as to what is perhaps more important— namely, the prospect of the measure being successfully worked. Those doubts mainly turn upon three points. I did not gather, from what the right hon. Gentleman said, what is the security which he intends to take against what I think the greatest practical danger — that of personation. The right hon. Gentleman passed rather lightly over that point. He said that there were a great many people who would be the natural allies of the Government against any such attempt. There were the clergy, the gentlemen of the neighbourhood, the employer, and plenty of persons who would be witnesses to identity. That applies, no doubt, to a rural district, to a small neighbourhood; but I am afraid that these witnesses to identity will not be so easy to call when you have such a case as this:—A man named John Smith, born in Glasgow, a mechanical engineer, emigrates from there in search of work, goes to Manchester and passes some time there, and then comes to London, where he remains for the rest of his life. Then it is alleged that John Smith, of London, has died, and the insurance money is claimed. I think you will have some trouble in tracing the identity of John Smith. I think the Chancellor of the Exchequer is hardly aware of, or does not attach sufficient importance to, the migratory habits of a large part of the artisan population. I do not mean to say that there may not be machinery devised which will guard against that; all I say is, that we have not heard what that machinery is to be, and that, to my mind, is one of the most important details of the Bill. Then, as to the question of the value of the lives, the right lion. Gentleman disposes of that in a summary manner. He seemed to admit that doing so large an amount of business for so small a sum in each case, it would be impossible to have an effective medical inspection for each person. [The CHANCELLOR of the EXCHEQUER dissented.] I understood that to be so, but if it was not the statement, at least it was the argument of the right hon. Gentleman. The line of argument which he adopted was that, after all, this inspection was not very material, because when you came to industrial assurance, giving a man's age and employment, and his habits as to temperance or intemperance, you had everything that was material to know.

THE CHANCELLOR OF THE EXCHEQUER

I said that when you had these particulars, you had pretty nearly everything; and I mentioned the case of an eminent medical person, who said, that in industrial insurances, he scarcely looked at the medical papers; but I never argued that they should be done away with. On the contrary, I referred to our deriving advantages from our connection with certain members of the medical profession.

LORD STANLEY

The medical men of the Poor Law Unions. That is a question which may be better dealt with in Committee; but when you consider the amount of labour which is thrown on the medical officers already, and the vast extent of some Unions, I am afraid you will find it practically impossible to have any very effective medical examination by them, putting aside the expenses which dealing with these small amounts would be considerable. But as to the principle that the age, the employment, and the habits of a man's life are almost the only material points to be attended to, I hear that for the first time. I am not prepared to contradict it. It is not a point on which many Members of this House have much knowledge. All I say is, that it is a very broad assertion, a very sweeping assertion, a very novel assertion. We have it at present only on the evidence of the single witness quoted by the right hon. Gentleman. I think that we ought to go a great deal more deeply and carefully into the matter to take that which, no doubt, is believed by the right hon. Gentleman for granted; because that question of the healthiness or unhealthiness of lives, is one of most vital importance. The only remaining point to which I wish now to call the attention of the House is this. I do not quite understand what security the right hon. Gentleman proposes for there being in no case any liability on the State. I was glad to hear him disclaim any intention to create such a liability, but it does sometimes happen that Insurance Offices are wound up. I hope that will not be the case with the Government Insurance Office. At the same time, we do not exactly know what may be the result of its working, and the practical difficulty, on which I think that we ought to be informed, is this—In the event of its being shown that this plan is not self-supporting, that the expense of agents, medical investigation, and various charges, are greater than the returns that can be expected, the business must be discontinued or carried on at a loss. In the event of its being discontinued, on whom is the loss to fall? Because I apprehend that there must be a loss, and I do not sec who is to pay it, unless it is to fall upon the State. I only rose to call attention to these points. I shall be prepared to go into Committee on the Bill with the very sincere hope that it will pass, and that we may either find it or make it a workable scheme. In the mean time I think that we are right in calling attention to those which at present appear to be the weak points of the Bill.

MR. HIBBERT

could scarcely give his consent to going into Committee on this Bill, because he could not think that it was the duty of the Government to undertake business of this kind. lie thought that the right hon. Gentleman the Chancellor of the Exchequer had made out a strong case—so strong that it must lead the Government in future years to undertake life assurance, not only to the extent of £100 but to any amount, and even to provide funds to meet the emergency of sickness, instead of leaving that provision to be made by the Friendly Societies existing in every part of the country. He regretted that complaints of this continual meddling on the part of the Government in matters of which they could not be cognizant should proceed from that side of the House. Only last year they had attempted to interfere with the self-government of the City, and had been obliged to desist, and propositions of a centralizing character were continually being made which would tend to destroy a proper dependence upon local self-government. He was afraid that when the three millions of persons who formed the Friendly Societies of the country saw the words "error," "deception," "fraud," and "swindling" applied to those societies, they would feel that needlessly harsh words had been used. He could not altogether approve of the strong terms which the right hon. Gentleman had applied to the thousands of Friendly Societies throughout the country, by far the greater number of whom had not been guilty of the faults which had been imputed to them, but had, on the contrary, encouraged habits of prudence and forethought in the working classes. He was very much afraid that the Government would get only the leavings and refuse business of insurance, because as they must charge much higher premiums than other Insurance Offices, a man would try first to get insured for the smaller sum, and if rejected would then apply to the Government Office to receive him. He had in his hand an article from the Economist, in which the writer said that the Government must charge higher rates than the existing offices, because they would work with inferior agency and at greater risk, for hundreds who would shrink from cheating aprivate individual would, without hesitation, cheat the Government. In conclusion he must repeat that he did not think that it was a part of the proper duty of the Government to undertake the business of life assurance; he believed that all the great writers upon political economy concurred in that opinion, and the danger to be feared from the Government undertaking business of this kind would be that they would by degrees be regarded as a paternal government, to do everything for the people; and that principle once established, the people would shortly do nothing for themselves.

MR. ROEBUCK

remarked that the right lion. Gentleman the Chancellor of the Exchequer seemed to have two objects in view in his speech that evening. One was to show that the present system of insurance was bad; the other that he was about to propose a much better method. The right hon. Gentleman had a fatal facility in vituperation, and he had certainly made out a very strong case against the persons whom he had described. But there was one very important proposition which the right hon. Gentleman had scarcely touched. It was laid down as a rule by all political writers, that whatever concerned the individual was best left to be done by the individual himself; that the Government which endeavoured to interfere in such matters almost always failed in its attempt; and that, in fact, a paternal Government was a great nuisance. The reason appeared to him very plain. First of all, there was nobody who had the same interest to do well for a man as he himself had; in other words, self-interest prompted every man to do all he could for himself, making him more industrious, more sagacious, and a better instrument for the furtherance of his own business than any other person could possibly be. On the other hand, Government was an operose machine, and while there were certain things which of necessity it must do, and which by common consent were left to its direction, it ought not to go one step beyond. The Post Office was one of those things which it was generally believed ought to be in the hands of Government, because there Government interference was believed to be really for the benefit of society. Still the case was open to doubt; for he was inclined to think that, if the Post Office were left to private management, the business would be a great deal better done. During the Crimean war there was in society what the Scotch call a "sough"—a whisper — that if the capture of Sebastopol had been made a subject of contract, it would have been accomplished with comparative ease. Mr. John Stuart Mill said, in his work On Liberty, that the most cogent reason for restricting the interference of Governments was the great evil of adding unnecessarily to their power; that every function super-added to those already exercised by them caused their influence to be more widely diffused, converting the active and ambitious part of the public into hangers-on of the Government, or of some party which aimed at becoming the Government; that if the roads, railways, banks, insurance offices, and all the great joint stock companies were to be made so many branches of the Government, and if their employés were to be appointed and paid by the Government, looking to it for every rise in life, not all the freedom of the press, nor yet the popular constitution of the Legislature, would make this or any other country free otherwise than in name. For his own part, he believed the Chancellor of the Exchequer was right in many of his state- ments respecting the improper conduct of certain persons who managed Insurance Societies, but he would ask him whether there was not a better mode of curing existing evils than by the introduction of Government interference. It seemed to him that nothing could be more dangerous than these constant attempts on the part of the Government to take from the people the management of their own concerns. The effect of these attempts, if successful, would be to make the people a set of helpless imbeciles, totally incapable of attending to their own interests; and then he would ask, what would become of the greatness of this country? Some persons might think that the present was a very unimportant question; but it was not so, for it touched the interests, habits, and manners, at least, of 3,000,000 people. He agreed that Government security would be a great advantage, but he could not help thinking that the object could be effected in another and better way. The right hon. Gentleman deserved the credit of having made a most powerful statement —a statement clear, and he was almost going to say convincing, but a statement shaded and darkened by attacks upon certain individuals which would not redound to his honour. No doubt there were difficulties and dangers connected with the insurance of lives which the plan of the right hon. Gentleman would in part remove. For example, if Government security were given, the working classes would not run the risk of losing their all; but, meanwhile, the country itself might suffer, because the Bill provided a machinery defective, unfit, almost certain to fail. In conclusion, he hoped the right hon. Gentleman would not hurry on the measure, but would afford Parliament and the country sufficient time to consider it in all its bearings.

MR. ALDERMAN SIDNEY

said, he was by no means convinced that it was the duty of the Government to interfere in this important matter. While he could not but regret the statements which had been made by the Chancellor of the Exchequer in reference to friendly societies, ho was not prepared to deny that there was much of justice in the view which the right hon. Gentleman had taken with respect to many of those institutions, He, at the same time, concurred with the noble Lord the Member for Lynn (Lord Stanley), in the opinion that fairness to those institutions, as well as the novelty of the question at issue, demanded that the further consideration of the Government scheme should be postponed until after Easter, in order that fuller information on the subject might be acquired, and the feeling of the country in regard to it more clearly ascertained. The House should be satisfied that they were legislating upon facts, and not upon a speech. No doubt, in propounding the scheme, the right hon. Gentleman had been actuated by the best motives; but still, as had been well observed by the hon. and learned Member for Sheffield (Mr. Roebuck), it was not the province of the Government to do everything for the people of this country. It was their duty rather to encourage feelings of self-dependence and self-reliance. Proceeding upon that principle, he had argued against the notion, that it was the duty of the Government to provide Post Office savings banks for the people, and, although it was said that they had succeeded beyond all expectation, he very much doubted the correctness of the statement; and it would, he thought, be found that the difficulties connected with them would year after year become more distinctly developed. He did not understand how the savings banks could be worked without a great increase of expense, and the proposed insurance business would cause very much more expense. Though he believed that it was the duty of the Government to encourage provident habits in the people, still he thought that they should not become a great competitive institution to provide for the wants of a great class of the people. The House was paying large sums for the education of the people, and they were assured that provident habits were much increasing; and surely under these circumstances the people might safely be intrusted with the management of their own affairs. In making these observations, however, he must not be understood as pronouncing an opinion that the measure under discussion was so unsound that it ought to be rejected. His object in rising on the present occasion was chiefly to protest against the measure being hurried through the House.

MR. NEWDEGATE

said, that having been one of those hon. Members who on Friday night urged the right hon. Gentleman not to proceed further with this measure until he had made a statement to the House, he felt bound to thank the right hon. Gentleman for having brought his great ability to the task of engaging the co-operation of the House, in which he had evidently succeeded, and to the more important task of explaining to the great mass of his countrymen that he was not proceeding without occasion to interfere with that which was to them their dearest interests. The right hon. Gentleman being in possession of all the information of which the Government had the command was, perhaps, the only competent judge of the matter. He trusted, however, that that debate, and the opportunity for deliberation which was to follow, might have the effect of making it apparent that the right hon. Gentleman, seeing the difficulty with which he might have been met had he simply proposed to regulate the various Friendly and Insurance Societies by law, had introduced a measure by which—he did not think the right hon. Gentleman wished to conceal it—the Government would become a competitor of these institutions. It might be, he thought, a means of bringing about this result: that the great mass of the contributors to those institutions might see that there was great need for additional regulations in their internal management, and that the Legislature should by law assure to them a, better security than that which they at present possessed. That, he must confess, would be a result infinitely preferable to passing the second principle of this Bill; but he would admit to the right hon. Gentleman that in the highly advanced state of civilization in this country, the great power of accumulating capital, and creating confidence in credit, that, considering there might be such influences at work— that however much they might deprecate Government interference in that which, upon grounds of strict political economy, should be the business of individuals — there might be such influences at work as would justify the interference of the Government in this or any other country to counteract influences that might become adverse to the State itself. He was speaking in the presence of Englishmen, who were accustomed to consider the impossibility of this; but as they were frequently warned of the process of assimilation going on between themselves and their neighbours, they must contemplate the dangers to which these neighbours had been subjected. He begged to thank the right hon. Gentleman for having complied with the wish of a very small minority expressed on Friday night, and for having come to the House to explain fully the necessity which he considered to exist for some legislation on the subject.

MR. W. B. FORSTER

said, he trusted the Chancellor of the Exchequer would listen to the appeal which had been made to him, and postpone the discussion for some reasonable time, as the arguments which the right hon. Gentleman had used, coupled with the statements he had made that evening, had completely altered the position of the House with respect to the Bill. He had come down to the House to listen to the explanation of a Bill, one part of which had at any rate a most excellent object—namely, to enable working men to make, by deferred annuities, a secure provision for their old age. The right hon. Gentleman's speech had, however, placed us all in an entirely different position, for it opened up a set of charges against existing Friendly Societies, which, if they could be substantiated, would render it impossible that the House could part with the subject, except after the fullest investigation. The right hon. Gentleman had told them that the societies established for protecting the savings of the working man were, firstly, subsidized by the State, and therefore that the State was, to some extent, responsible for them; and secondly, that a very large number of those societies were either fraudulent or insolvent. The effect of this statement would be to inflict a tremendous blow on those societies throughout the country, and although he thanked the right hon. Gentleman for the courage with which he had grappled with the question, the state in which he left it made it absolutely necessary that the House should go further into the subject. It might have been better if the House had been asked to appoint a Select Committee on Friendly Societies. At all events, if that could not be obtained, time should be given for the fullest possible discussion. It was only right that they should have these vague but grave charges against the societies, with which poor men deposited their money, before them in a more detailed form. The House must know where those charges applied and where they did not apply. Most of those societies had a certain legislative sanction. They had certain rules, and were registered in a Government office, and the result was that hundreds of working men believed that in such formalities they had a Government guarantee for their money. Such a system could not go on much longer. He should be glad, also, that the managers of Friendly Societies should have full opportunities of being heard, as he was sure that the right hon. Gentleman did not mean Ms statement to be understood as making the grave charge of fraud against the great majority of these societies. [The CHANCELLOR of the EXCHEQUER: Hear, hear!] One very large society, the Manchester Unity of Odd Fellows, was well known to him, and although he could not say that it was conducted on entirely sound principles, he had no doubt whatever of the bona fides of the management. It was important that such a society should have an opportunity of clearing itself from all charges. Then there was another delicate part of the question. He alluded to the meeting held on Saturday last, presided over by a person who had made himself conspicuous in questions of trades' unions. He was not going to drag trades' unions into the discussion, but he was quite sure that nothing was less likely to wean trades' unions from their unjustifiable practices than any attempt to make a side blow at them in the progress of an economical measure like the present. Trades' unions, therefore, should have some time to consider the question; and, therefore, if they could not have a Select Committee, the best way would be to put off the discussion until after Easter, and in the mean time those lion. Members who came from the populous manufacturing districts would have an opportunity of consulting the working men. He did not think the working men would be hostile to the proposed measure when once they fully understood it. He did not know whether the right hon. Gentleman had read a letter which had appeared in the Star of that morning from an officer of the Manchester Unity, in which the writer disclaimed opposition, but expressed his opinion that the Chancellor of the Exchequer would, if he had made inquiries, have found that the working men were not quite so ignorant as to the management of their pecuniary affairs as was generally believed. Let the right hon. Gentleman and the House remember that they were dealing with millions of money, the savings of working men for the last twenty years, and if they struck any blow at the credit of these societies the effects might be most disastrous. He trusted that all these considerations would induce the right hon. Gentleman to postpone the discussion until after Easter.

MR. BOVILL

thought the whole country would feel indebted to the Chancellor of the Exchequer for his statement, dispel- ling, as it did, the erroneous impressions which had gone abroad, and showing conclusively the necessity for some measure like the present. It was impossible to think that any Department of the Government would gain the slightest advantage from the Bill. Our industrial population, for whose benefit alone it had been introduced, was most materially interested in the proposal, and those best acquainted with that important subject had arrived at the opinion, that the interference of the Government was absolutely essential. The whole community was interested in the promotion of provident habits among the working classes; but for that purpose it was requisite that the working man should be able to deposit his hard-earned savings where they would be sure to be available as a future provision for his family. It mattered little whether it was through mismanagement or through fraud that his savings were dissipated, and his family' pauperized, instead of being placed in independence. What was wanted was some absolute security that the hopes which encouraged his thrift and his self-denial should not be ultimately blasted. The effect of security being obtained, such as that which was offered by the Government, would induce provident habits and a-feeling of security, which was of equal importance to security itself. The Chancellor of the Exchequer, so far from overdrawing the picture, had understated those facts which had over and over again been proved in courts of justice. The tale which the right hon. Gentleman told in 1864 was identically the same as was told to a Select Committee eleven years ago. The Committee of 1853, in their Report, said that there were, no doubt, instances of great abuses and of flagrant frauds, more akin to swindling than to the operations of regular trade. They also reported, that since the passing of the Act of 1844, 311 Insurance Companies had been provisionally registered, of which number only 140 had been completely registered, and only ninety-six existed at that time. It was lamentable to find that, deducting ninety-six offices, which were in existence in 1853, and sonic few which had been amalgamated with other companies, the remainder of the whole 311 had absorbed the hard-earned savings of working men without yielding the slightest benefit in return. The facilities for fraud afforded to these insurance companies had been pointed out by the Chancellor of the Exchequer, and were easily intelligible when it was remembered that, their gross liabilities being necessarily postponed, they could exist for many years by paying the demands made upon them out of their annual income. Some years ago there was a remarkable instance of the formation of one of these companies. One or two persons started a Life Assurance and Annuity Society, and published a flattering prospectus inviting domestic servants to invest their savings. Funds flowed in, but the whole of the monies were appropriated by the managers and directors, and when the limited field which they cultivated was exhausted there was nothing to pay the insurers. It then appeared that the promoters had hired twelve directors, and had given them names of great distinction— he would not mention the names lest he should insult hon. Members present—but the best names in the City of London were represented to be on the board. Those names were of great value in the prospectus, and the persons who represented them, he believed, were retired schoolmasters with bald heads, powdered wigs, and every artifice to inspire confidence. The rate of payment by the rules was 5s. per head per day. Further, to insure a good personal appearance, coats, waistcoats, and trousers were supplied, and the directors were enjoined to wear expensive jewellery, such as diamond rings, which were also provided out of the funds, and for not wearing a ring the fine was 2s. 6d. Ludicrous as it might appear these facts were proved over and over again, and hundreds, nay thousands, of poor persons were in this manner defrauded of their savings. The same thing might occur again to-morrow. In fact, if two persons of distinguished name were in want of funds, and did not object to do it, the easiest way to raise money was to start a society of this kind, with a capital of one million, all paid up. He hoped, therefore, that time would be given for those facts to go forth to the public, that the eyes of those most interested might be opened, and this organized opposition to the scheme of the Government at once be defeated. The law provided that the deed of settlement should be signed by persons to an amount equal to one-fourth of the capital and to the number of one-fourth of the shareholders. But that was easily managed. One man was induced to sign for £40,000 who did not possess 40,000 farthings, and whose only means of payment was the shilling given to him by the promoters, in addition to a pot of beer, for affixing his signature to the deed. A new office generally set out in their prospectus that there was a capital of £1,000,000 all paid up—that is, the directors would vote £10,000 in paid-up shares to the promoters, and £10,000 paid-up shares to each of their own body. If asked where was their paid-up capital, their answer was that it existed in those paid-up shares. In 1853 it appeared by the Report of the Committee, that it was a common practice to register one prospectus and issue another, and that there were no means of preventing such misrepresentation. He was afraid that the same system existed now, and that it was just as impossible to prevent it as it was at that time. In 1864, it would be found that they had not advanced very much in the security of such institutions. After registration, a society was ready to commence operations—what were its operations? The constant receipt of money. It had nothing to pay whatever. It might luxuriate in the amount of its income, with no one to control it. If at any time the society was at a loss for funds, it had only to issue a few more agents and to stimulate their efforts by an allowance of 25 per cent on the amount of the premiums paid, receiving the remaining 75 per cent for its own necessities. At last the time might come when it would become necessary to make some provision for the payment of a large amount of loss. When that did arrive the directors might be called on to provide the money themselves. It happened not unfrequently when that time arrived, the directors were unable from their own private resources to make up the amount required among them, and the next resort was to amalgamate with another company. That operation might be thus described:—It was proposed to amalgamate. The office which had accumulated a number of insurances had a property in the policies and in the receipts resulting from them. The transaction had to be negotiated, and, of course, the negotiator received a considerable profit. Those who retired from the falling company had certain annuities provided for them. The company was then transferred to another, which, when placed in similar embarrassments, resorted to similar means of getting out of their difficulties. But if they were not so fortunate as to sell or amalgamate, they had to resort to the Court of Chancery, and many instances had been shown in which the societies had no funds and no means of dischar- ging their liabilities. The great misfortune arising from this state of things was that the poorer classes had no means of knowing or judging of the respectability of any of these offices. He should very much regret if any of the observations that had been made in the House should have the effect of showing the necessity of an inquiry into the concerns of several of these offices, but it was quite clear, from the disclosures which had taken place with respect to two industrial societies, that many were not entitled to the public confidence. It was no small matter that the Government had come forward, and offered an absolute security. That was the great point. Where the existing societies had failed and did fail, and where the interests of the working man were in jeopardy, the Government stepped in and offered a complete security. Besides Insurance Offices, the Chancellor of the Exchequer had referred to Friendly Societies. He believed there was a sincere desire on the part of the working classes to place these societies upon a proper basis, and with a view to their ultimate success. But it did so happen, that with the best and most honest intentions on the part of the managers, they were so crippled and hampered that the funds gradually dwindled, that when old age came on, they were without the means of meeting the claims upon them. In one year, not less than sixty-seven of these societies, which had absorbed the hard-earned money of working men, were broken up; and when such a state of things existed, he thought every one must admit that the matter was deserving of the serious consideration of the House. Unless great care and attention was bestowed on the preparation of the tables, it was impossible that any society could succeed; and he spoke with the more authority, because in his own small parish, where an earnest endeavour had been made to carry out the Friendly Societies, two of them had failed, and many persons who for fifteen years had been investing their earnings, now, at an advanced period of life, found themselves consigned to the parish workhouse. It was circumstances like these which had induced the Chancellor of the Exchequer to take up the subject, not in any spirit of hostility to the Friendly Societies, and he trusted that those who supported the right hon. Gentleman would not be looked upon as doing anything injurious to these societies, but would rather be regarded as desirous of promoting their advancement. Every one would be glad to see the proposition of the Government become a dead letter, provided the societies could be established on principles which would afford that security which the Government were prepared to offer. The offer of the Government must be a gain to the working classes, because they would have the opportunity of either investing in a private society, or in that which afforded them absolute security. With regard to the objections urged to the Government engaging in undertakings of this description, the point was inquired into by the Committee, and it was considered that such interference was not only justifiable, but that it was a matter of high duty for the protection and information of the public. It had been said if the Government take up insurance why should they not become dealers, and embark in other commercial pursuits. Now, in commercial pursuits generally, the public had the opportunity of knowing the nature and character of the company; but in the case3 to which he had been alluding, the poor man had no means of forming a correct opinion as to the stability of the offices with which he became connected. With regard to the suggestion that the Government might be open to considerable frauds, he did not see why precautions could not be taken to protect them against fraud as much as other parties. Then, as to the suggested interference with private associations. As regarded the great Insurance Companies, the measure could not touch them at all. If the condition of the minor offices was such as had been described, it was the duty of Parliament to interfere and provide that security which did not at present exist. As to the assertion that the project was unfair to those who invested their capital, the complaint was that these offices started without capital, and that the money received was improperly spent and squandered. The extent to which these practices had gone was almost beyond belief. Many hon. Members, from the information which had been afforded to them by their constituents of the disastrous effects which had resulted from these institutions, must be convinced that some means were necessary for the repression of such evils. He thought this was a matter which, when it became known, would commend itself to the working classes of this country, and he believed the country at large would feel an obligation to the right hon. Gentleman for having introduced it.

MR. POLLARD-URQUHART

observed, that Mr. Mill headed one of his chapters, "Non-interference generally desired," referring to Government interference, but that proposition was subject to large exceptions upon the other side if the Chancellor of the Exchequer had succeeded in making out a good case for exceptional legislation in that case. He thought the scheme of the Chancellor of the Exchequer required much consideration, but if the suggestion of the noble Lord the Member for King's Lynn were acted on, and the accounts of the annuities kept separate from those of the National Debt, the working of the scheme would be seen very clearly, and if it were a bad one it would be sure to fall to the ground. At all events, it could at present be only regarded as experimental.

MR. HENLEY

I hope the discussion of this matter will be adjourned. Having regard to the formidable case put forward by the Chancellor of the Exchequer, I think if that case is well founded it will be an advantage to the right hon. Gentleman to have it well considered by the country; for in such case his Bill will give general satisfaction, and receive general support. I should not have ventured to say anything in this stage of the Bill if it had not been for the very strong manner in which the right hon. Gentleman spoke of Friendly Societies. With regard to Insurance Companies, I do not know much of them, and from what I do know of them I do not think very much of those of which he has spoken so strongly. But I was not a little surprised to hear the language used by the right hon. Gentleman when he spoke of Friendly Societies. "Swindling" was the mildest term he applied to them, and he ended by observing that they were in an unsatisfactory, he might even say fraudulent, state.

THE CHANCELLOR OF THE EXCHEQUER

No.no!

MR. HENLEY

I am glad I have given the right hon. Gentleman an opportunity of contradicting that statement; but certainly I understood him to use the word "fraudulent," and I took it down at the time. However, I am quite sure the general tenor of the right hon. Gentleman's speech to-night, with regard to Friendly Societies, will cause a panic in the country. I feel this very strongly, the more strongly because the right hon. Gentleman seemed carefully to avoid—certainly he did not touch on—the great objects of these societies. Their objects are threefold: payment in sickness, which the right hon. Gen- tleman leaves untouched; the deferred annuities, and payments on death, commonly called "payments for funerals." The right hon. Gentleman gives us no information whatever as to what proportion of the business of those 20,000 or 30,000 societies of which he spoke is in deferred annuities or payments to the sick. That is a most important element in the consideration of the matter. Again, the right hon. Gentleman gave us no information as to the proportion of lives insured under sixteen and over sixteen respectively; but he knows, as every one acquainted with the subject must know, that lives under sixteen are the most dangerous and troublesome to insure. The right hon. Gentleman used strong language when he said that of 20,000 of these registered societies about 9,000 had failed, and it is proposed, with that statement going to the country, to enter into competition with them for that part of the business which is supposed to be the most profitable, and to refuse to take that which he knows to be the most difficult and the most exposed to risk and hazard. But the right hon. Gentleman said, "I cannot propose to take insurances under sixteen." He knows the difficulty of that class of insurances, and he is also aware that poor persons wish to insure in order that they may have the means of burying their children. These are the points which strike me with regard to these societies, and I think that in dealing with this Bill they require careful consideration. I know that many of the Friendly Societies are not in a position one might desire; but it is another matter whether what is proposed to be done will improve them. On the point whether it is the payments on death or the payments on sickness that has caused the breaking down of those societies, no information has been given by the Chancellor of the Exchequer. As one who has had experience in the country, I believe they are much more likely to break down in consequence of the heavy Bick payments than from any other cause. But that is to be left untouched by the present measure. All the liability is left on those societies; and a competition is to be entered on in respect to that which has helped to sustain them. The right hon. Gentleman in stating those 9,000 failures gave us no information as to the proportion of those societies which after winding up immediately reconstructed themselves, taking on themselves the old liabilities. That is a material point; because anyone who has had experience of the working of those societies must know that many of them after coming to an end by mutual agreement immediately reconstruct themselves, taking upon them the outstanding liabilities. I should be glad that the right hon. Gentleman would give us information on this subject, if it is in his power to do so. At all events, I hope the right hon. Gentleman will give time for the consideration of the measure; for I think, after the speech which he has delivered, it will strike the country, as it strikes me, that there is a deliberate intention to break up the whole system of Friendly Societies throughout the country. Certainly I do not see how you are to stop at £100. We have had no information as to what proportion of the assurances are above or below £100. I hope when this question comes on for further discussion, the right hon. Gentleman will give us information upon that point, because it does seem somewhat difficult to understand why, if a system of fraud is going on, you are to leave all persons assuring above £100 still exposed to that system. I will not detain the House any longer at present, as I understand we are not to go into Committee until after Easter, so that ye shall have plenty of time to consider this subject.

MR. BAINES

said, he rejoiced to hear the practical remarks of the right hon. Gentleman the Member for Oxfordshire, and he hoped the Chancellor of the Exchequer would take into his consideration the points which had been so well explained. The most profitable portion of the business of Friendly Societies was life assurance. He was informed that the profit upon the sickness department of those societies might be reckoned at 10 per cent, while the profit upon life assurances was about 25 per cent, and in many, if not most, of the societies, the business of each of those two departments was about equal in amount. If they obtained 25 per cent profit upon the life assurances, it would enable them to pay for their agencies and to keep going, while probably the profits from the sickness department alone would not be sufficient. If the effect—unintentional as he believed it would be—of the Chancellor of the Exchequer's measure was to undermine those societies, and to jeopardize their existence, it would be a very grave misfortune. The number of persons interested in registered and unregistered societies in England and Wales was supposed to be about 3,000,000, and the property they represented had been estimated at £11,500,000. The question, therefore, was one of very great importance. Although he regarded the establishment of Post Office savings banks as a brilliant success, he could not but regard the proposed addition of life assurance to the duties of provincial postmasters with serious apprehension. It would be dangerous to employ small country tradesmen in the delicate matters connected with life assurance; and the medical officers of the Poor Law Union, though an efficient body of men, were amongst the youngest members of their profession, and were scarcely to be intrusted with the decision as to the persons to whom Government guarantee should be given, extending over a number of years. The machinery proposed by the Bill was objectionable, both as regarded the postmasters and the medical Inspectors. The hon. and learned Member for Guildford (Mr. Bovill) had used arguments not only against Friendly Societies, but also against Assurance Societies, which -would equally apply to all joint-stock companies, and even to private commerce. It was to be regretted that the Chancellor of the Exchequer had not assented to the proposition to refer the subject to a Select Committee, because the Bill had already produced a kind of panic in the north, and the panic would be increased by the right hon. Gentleman's speech. Friendly Societies might in some cases be mismanaged, but in principle they were excellent institutions, possessing many moral, intellectual, and social recommendations. They were as old institutions as any that existed, and were as beneficial as any in their process. Admitting fully the necessity for searching inquiry and for solemn warning—admitting that further legislation was necessary, and that it might be desirable to call on Mr. Tidd Pratt to register not only the rules, but the tables of calculations of these societies—he was still afraid of a measure so sweeping in its nature. A cautious financier might well tremble to commence such a system, for it was not possible to try the experiment and then retreat. In the interval which would elapse before this measure would be brought forward again, he suggested that the Chancellor of the Exchequer should consider, whether it would not be advisable to have a Select Committee to inquire into the whole matter?

MR. HARVEY LEWIS

said, that while he acknowledged the anxiety of the right hon. Gentleman to promote the welfare of the working classes, he was still unconvinced of the propriety of the measure now put forward in their interest. The speech of the Chancellor of the Exchequer would, he feared, produce a panic throughout the country respecting Friendly Societies, and seeing that an immense amount of property was at stake there, and that the savings of three millions of people might be said to be invested in those societies, it was to be regretted that the whole of them should be exposed to unmerited suspicion because of the faults of a few. The House had heard of their misdeeds, but not of the good they had done, the habits of self-reliance and the love of local self-government which they had fostered. There was a danger that if the people were led by such measures as this to look to the Government alone, they would no longer have thought or energy to do anything for themselves, but in any misfortune which occurred would look on the Government as the cause and themselves as the victims. If the people who had surmounted the cotton crisis so nobly had not been brought up to rely on themselves rather than on the Government, they would have thrown themselves on the State for relief the moment distress came upon them; and if that feeling were destroyed by such measures as the present, a grievous blow would be aimed at the independence of the English character. Granting that there were faults in the management of those societies, was the remedy suggested the right one? It was not proper to make accusations when there was no one to answer them, and to legislate as though everything was proved. Even Government Departments were not wholly free from fraud, and it might be that the evil which would be created by this measure was greater than that which it was sought to remedy. This business into which the Government now proposed to enter was a mere speculation, and who was to pay the cost of failure, if failure ensued? Life assurance was one of the most delicate of commercial operations. Actuaries were required at high salaries, eminent physicians must be employed, and how were these expenses to be defrayed? Then, enormous frauds were perpetrated on the Insurance Companies, and still more would be perpetrated upon the Government by personation and otherwise. The extent to which the right hon. Gentleman now proposed to go was £100; but in a few years' time the House might be asked to extend this limit to £200, £300, or £1,000. Many people had lost money by banks, but ought the Government, therefore, to establish banks, and follow that up by centralizing the industry of the country? He thought the people ought to be allowed to take care of themselves as far as they could. He had never heard one word of complaint as to the want of those annuities, or in favour of that Bill, but he had, on the other hand, received many communications from his constituents against it. The working classes were very good judges of what benefited themselves, and they looked upon the interference of the Government in everything that did not concern the Government with extreme jealousy and suspicion. The people of this country did not pay taxes for the purpose of enabling the Government to speculate with them. The Bill might be a success, but it might also be a failure, and, if so, who was to sustain the loss? The country was, to a certain extent, taken by surprise by the Bill, and he trusted that it would be referred to a Select Committee.

SIR MINTO FARQUHAR

begged to move the adjournment of the debate. The Chancellor of the Exchequer was, he understood, ready to adjourn the debate until Thursday week, with the understanding that the House was not to go into Committee until after Easter. At the same time, he reserved to himself the right to move an Amendment that the Bill should be referred to a select Committee.

MR. REMINGTON MILLS

said, he wished the Chancellor of the Exchequer would give the House a Return of the payments to Friendly Societies during the last twenty years. He also thought that the House ought to have the scale of premiums on which the right hon. Gentleman intended to act. That was a matter of the utmost importance in the consideration of this Bill. The Government was, he thought, likely to fail in its medical arrangements. Before Insurance Companies accepted a life they could consult the medical adviser or the party proposing for the insurance, their medical agent in the neighbourhood, and their medical advisers in London. The Board of directors could also see the parties themselves, and if any doubt existed as to whether the life was a good one or not, an additional sum might be put on to cover the risk. But the Government scale must be absolute, and they must adhere closely to it. The next thing would be to tell the Friendly Societies that if they did not adopt the Government scale, they would not be allowed to have the benefit of the Government rate of interest. He was very much afraid that that Bill would cause a serious panic among some Friendly Societies, and that the Government operations would shut up others. In annuities the worse the life the better for the Government, but the reverse would be the case in life insurances. There would be this difference, also, that a Board of directors sat to make a profit for themselves and their co-proprietors, or policy holders, while a Government Board would only have a certain amount of business to get through. The caution and discretion of a Board of directors was not, therefore, to be expected from a Government office. For these reasons he feared that the scheme of the Chancellor of the Exchequer would practically turn out to be a failure, and a source of loss rather than profit. He trusted that the right hon. Gentleman would, at the earliest possible period, let the House see the scale of premiums.

THE CHANCELLOR OF THE EXCHEQUER

said, he saw the desire of the House for the adjournment of the debate, and he would not dispute its reasonableness. He should not object, therefore, to the adjournment of the debate until Thursday week, in order that the Speaker might then leave the chair pro formâ, so that the House might go into Committee on the Bill on some convenient day after the Easter recess. In regard to the desire of his hon. Friend (Mr. Remington Mills) to obtain a Return of the payments to Friendly Societies, he could assure him that he had it already, such a Return being regularly made under an Act of Parliament. With regard to the safety of the proposed scheme, he had stated that though he felt quite convinced of it, yet he entirely recognized the legitimacy of the jealousy of the House upon the subject, and he quite acceded to the proposition that any rules upon which the Government should act should come under the notice of the House of Commons before being carried into operation. Of course, if there were loss in the operation of such rules, that loss could be borne only by the public. It had been supposed that he had declared that it was not possible to guess the solvency of any scheme of assurance for thirty-seven years after it was founded. But in that he had been greatly misunderstood. What he had said was, that the payments upon death of a Life Assurance Society need not exceed the receipts upon premiums for a period of thirty-seven years, and his authority for that statement was a table of Dr. Farr's. As to any element of uncertainty, the calculations made upon the subject were of so complete and exhaustive a nature, that the result was as practically certain as anything in the future could be. It had been said that the Government were going to take away all the profitable business of those societies, and to leave them the unprofitable—that was to say, that the sick department and the very young lives were unprofitable. That reminded him of the old story, that it was the wheat crop which paid the farmer's rent. But in each well constituted society every part should pay. The lives of children involved various elements of risk, and, therefore, did not seem so proper to come within the scope of the Bill. It had been said by the right hon. Gentleman the Member for Oxfordshire (Mr. Henley), that great alarm was likely to arise from what he had said on the subject of Friendly Societies. But the right hon. Gentleman himself went on to say that many of them were not in a condition that he could wish. He did not go further than that, except that he added that many had the name of Friendly Societies, but were really different, and with respect to them he stated facts. But with regard to the generality of Friendly Societies he rendered his tribute to their character. The hon. Member for Marylebone had said, that it was unfair to make accusations which there was no one to answer. But he had told no secrets. He had heard many things in the course of his inquiries, but because they were communicated in private conversation, and it was impossible for him or others to check them, he had kept them back from the House. He was not aware that he had made any statement which did not rest upon printed and published documents, just as much in the possession of hon. Members as of himself. The hon. Member for Marylebone (Mr. Harvey Lewis) was apprehensive that the effect of the measure, if adopted, would be fatal to Friendly Societies. But he took a more sanguine view of the matter, because he looked back to what had been the case of savings banks. For nearly twenty years there had prevailed among their very best friends and in all successive Governments an impression that there was a great deal that was not secure in their existing rules, and efforts were made from one quarter and another to pass Bills for their reform. He himself attempted it, the late Sir George Cornewall Lewis attempted it, almost every Chancellor of the Exchequer and other hon. Gentlemen did the same, but without effect. But the Post Office Savings Banks Bill was passed, and those banks came into competition with the old savings banks, and the result was that the hon. Member for Evesham, one of the best representatives of the old savings banks, introduced a Bill on the subject which made everything secure. That was what he believed would take place in the present case.

Debate further adjourned till Thursday, 17th March.