HC Deb 12 May 1865 vol 179 cc194-206

, in rising to move a Resolution on the subject of the inadequate remuneration of Postmasters, said, he wished first of all to clear himself from a charge which might be brought against him, and to answer by anticipation an objection which was usually made against Motions of a similar character. The charge was that he was aiming at an increase in the taxation of the country. Of course this was the case indirectly, insomuch as it diminished the surplus revenue of the Post Office, but he submitted that the Post Office was not to be considered a branch of the revenue, but an establishment for giving every convenience to the country within the scope of the Department, provided it could be done without loss. Now, according to the last Report of the Postmaster General, there was a surplus of £10.000 to the credit of the Post Office savings banks account. He had heard it, indeed, doubted whether that was a correct statement of account, and it had been said that the savings banks had worked at a loss. He trusted that this was not the case, and, at any rate, he had a right to assume that the surplus stated was real, and it was out of that surplus that he thought a fair payment should be made to those who worked the system. So much for that objection. The other was that there was never any difficulty in getting the work done on present terms, and that, in fact, there were many applicants for every vacancy. He would not go into the abstract question of the propriety of a Government setting the example of giving inadequate wages, but the real fact was that a great majority of Postmasters gave merely their spare time to the Government. They made their livelihood in other ways. Hon. Members had heard of the individual who advertised for a pensioner as hall-porter, because the wages he gave were insufficient without the pension, and they knew that the slopsellers kept needlewomen's wages at a starving point by introducing the competition of the convents, the inmates of which were supported in other ways. But then, of course, the question arose whether the retail shopkeeper, who had his hands full of other work, was the proper person to work Government savings banks, and, still more, the new system of Government annuities. So that the question was not only the narrow one of increased pay to certain people, but also the more important one whether, under the present rates, the work was properly done. There was scarcely an office under Government which might not be filled at a less charge. People with full confidence in their own powers would, no doubt, accept the office of Chancellor of the Exchequer or Secretary to the Treasury, at one-tenth of the present cost to the country, but the country would scarcely gain by the economy. He thought it necessary to say so much by way of preface, as he quite admitted the inexpediency of such Motions on general grounds, and that almost every branch of public servants would complain of their salary if they thought their complaints would be heard. He had originally intended simply asking a question at the request of a country clergyman; but after placing the notice on the paper he had received so many complaints from all quarters, and his correspondents had stated so many cases of hardship and mischief arising there from, that he felt justified in altering the question into the present Mo- tion. He would not detain the House long, but he begged hon. Members, especially those who sat opposite, to remember that he was advocating the cause of a class deprived of the franchise, and therefore, according to their views, entirely unrepresented in the House; who lived, moreover, in such dread of incurring the displeasure of their official superiors that some had written anonymously, and others had expressed the greatest fear of being supposed promoters of his Motion. He objected, as contrary to public policy, to encouraging public servants to make complaints of their superiors. He had, therefore, sought for information chiefly from independent sources, clergymen and others who were interested in the question on public grounds, and though he trusted that his statement might lead to a fairer treatment of an important class of public servants he had also in view the impediments caused and likely to be caused by their discontent to the operation of those useful measures, the Post Office Savings Bank Act, and the Government Annuities Act, which latter was also, as they were informed by a paper laid lately upon the table, to be worked through the Post Office. He might state that he had received information from the counties of Middlesex, Surrey, Kent, Sussex, Devon, Gloucester, Somerset, Lincoln, Salop, Northampton, Herts, and others, but for obvious reasons he should not mention the exact localities. It must be evident to all that within the last three years enormously increased work had been thrown upon the keepers of post offices. According to the Postmaster General's Report for the past year the deposits which had been paid into the various post offices had amounted, with interest, during the interval between September 1, 1861, when the Act first came into operation, to March 31, 1864, to nearly six millions, and the net profits of the Post Office to more than £10,000. Before this time Postmasters were not overpaid, when it was considered how much additional work was entailed upon them by the growth of the system of money orders and the book and pattern post. What, then, was the additional remuneration received for the vastly increased trouble of the savings banks—trouble in no way connected with the business of carrying the correspondence of the country, nor indeed to have been anticipated, for the Postmasters might as reasonably have expected to be turned into Govern- ment tailors as Government bankers. There seemed to be certain classes under which postmasters might be ranged in reference to payment. The right hon. Gentleman the Secretary of the Treasury might possibly explain the principle of the classification. He found that the most fortunate received £5 for every 1,000 transactions. That seemed to him a reasonable arrangement, as the trouble of large and small deposits was the same, and he thought it sufficient in amount. Others were paid at the rate of 1d. for every deposit, which might possibly be sufficient also, because though some grumbled others seemed satisfied, and one of the recipients expressed his opinion that the Post Office was just though stingy. After these two, however, came three classes which were much more hardly treated. The first received one halfpenny per deposit, and 1s. per cent on the amount the first year, but afterwards nothing. The second, certain apparently arbitrarily fixed small sums the first year, since then nothing. The third was most illused of all, for they had never received anything; but they had been led to expect something eventually, and lived in hope. Meantime there were complaints that the bonds had been enlarged, and the percentages on money orders and postage stamps reduced, and there was apprehension expressed that the Postmasters would have to work the Government annuities scheme gratuitously also. He had stated that he had advocated the cause of these officials because they were helpless and incapable of resistance. He had heard, however, that one in London had thrown up his office and published his reasons on a large placard exhibited in a shop window, couched in terms by no means complimentary to the authorities. But a still more important part of the question was its effect upon the public service. He was an advocate of Post Office savings banks and Government annuities, and wished them success; but the course taken in respect of these salaries militated against it. One Postmaster wrote that he should discourage Government annuities because he got well paid by benefit societies; another stated that the old savings bank in the town paid an actuary £100 a year for keeping the office open for an hour or two once a week. A clergyman wrote— I can plainly see the Postmaster discourages the issue of 'books,' and what he does in all probability others do. The trouble is very considerable, and all the same whether 4d. or £4; as I was mainly instrumental in getting the savings bank established here, I feel somewhat guilty in having entailed so much upon him with so little return. He could multiply cases of this kind, but would not weary the House. Early in 1862 the hon. Member for Rochester (Mr. P. W. Martin) asked a question on this subject, and the Secretary of the Treasury replied that there was, doubtless, an increase of trouble, and that the remuneration was under consideration. This was also stated in the Postmaster General's Report, so that the Postmasters had been living in hope, which alone induced them to put up with the present scale of payment. He would not enlarge on the immorality of underpaying those who held offices of trust; because, though there had been defalcations, yet it was infinitely to the credit of the class whose cause he advocated, that of the vast amount of valuable property of every description which passed through their hands so little miscarried. The subject of salaries in every department of the Post Office was a most important one, but he had preferred confining his remarks to one branch, and feeling as he did that no more time should be lost in placing these payments on an adequate, fair, and uniform basis he should conclude with the Motion which stood in his name.

Amendment proposed, To leave out from the word "That" to the end of the question, in order to add the words "in the opinion of this House, it is neither just nor expedient that labour and responsibility should be imposed upon public servants, in respect of Post Office Savings Banks, without adequate remuneration,"—(Mr. Cave,) —instead thereof.

Question proposed, "That the words proposed to be left out stand part of the Question."


said, that when the Bill for the establishment of the Post Office savings banks was under discussion he had ventured to suggest to the House that the difficulties of the scheme would commence with its success, and that it would not be so easy to conduct it as some hon. Gentlemen seemed to suppose. It had occurred to him that those who had the conducting of the business of those banks would view matters in pretty much the same light as they were regarded in public offices generally, and think that very little ought to be done and a large salary paid. He had foreseen that as soon as people began to deposit their money, a large amount of discontent would grow up. The House had now before them the first appearance of the difficulties arising from the attempt to establish a national bank for the savings of the people. No doubt there was a great deal of truth in what the hon. Member had just stated, and that the Postmasters were grievously discontented at having so much additional work and no additional remuneration. It was difficult to persuade people who had been employed to discharge one duty that they ought to perform another, and he believed the Postmasters had not only to do that, but to receive an enormous amount of abuse into the bargain from those who deposited money. It was not an uncommon thing for a Postmaster to find himself assailed by a depositor, who, on examining his book and finding the interest to amount to so much less than he had anticipated, accused the unfortunate Postmaster of fraud and robbery. He thought, however, the House ought to proceed with caution, and be slow to accede to the Motion of the hon. Member for Shoreham (Mr. Cave). They had hardly sufficient experience in the matter to venture on any expression of opinion. He would suggest that before any step so decided was taken it would be necessary to appoint a Committee to inquire into the working of the Act. No doubt the Postmasters had been encouraged to make this application by the Returns which had been laid on the table, and been commented upon in the newspapers. When those Returns appeared the people were congratulated on the success of the Post Office savings banks, for they showed that there was a very considerable balance on the profit side of the account—he believed £21,000. He was afraid, however, that when matters came to be examined a little more closely they would wear a different complexion. The House knew that certain joint-stock banks had showed they were able to pay 10 per cent, and, what was more, had actually paid it; but those establishments failed afterwards, and then it appeared that they had neither capital nor profit. In the accounts of the Post Office savings banks laid on the table of the House, as he understood, no notice was taken of the important fact that a considerable amount of the funds was invested in terminable annuities which had not a great many years to run. Therefore, though the interest paid on those investments was not only enough to pay the current expenses of the banks, but also to leave a profit, it was in reality merely nominal, for it was a part of the capital which was being wasted. He had moved some time ago for a Return of the depreciation in consequence of the lapse of time, and it appeared from the figures which had been laid upon the table that the amount was now £81,000. If, then, they deducted that £21,000 of apparent profit from the loss by depreciation, there was an actual loss up to the present time of £60,000 on the Post Office savings banks, instead of there being a gain of £21,000. This might be remedied at a future time through increase of deposits and other causes; but it showed that the House ought not to encourage any increase of expenditure at present. Should those persons who performed the duties of postmaster be unwilling to conduct the savings banks without additional remuneration, it was evident that Parliament would have to subsidize those banks out of the Consolidated Fund if it meant to carry them on. But it was much better that there should be a thorough inquiry into the whole subject before any decided course was taken. It was scarcely fair to make that inquiry at present, as the Post Office savings banks had not been established a sufficient time for them to get into thorough working order. Probably in a year or two the question would be ripe for discussion, and he hoped the House would then thoroughly sift the matter, and, in case it should turn out that the savings banks could not be carried on without a loss, take into consideration the advisability of entering into some new arrangement with regard to them. In the meantime, however, it would be highly improper to force Government to spend the public money, which, unfortunately, they were always ready enough to do. The House had better perform its proper function of endeavouring to keep down the expenditure, rather than afford the Government any excuse for extravagance.


said, he entirely sympathized with the Chancellor of the Exchequer in the embarrassing position in which he was placed by Motions of that description. He had received no communication from any Postmaster on the subject, but the present proposal was so exceptional a one that he felt bound to give it his support. The increase which had of late years taken place in our Post Office system must have imposed a large amount ef additional duty on the Postmasters, and that increase of duty was not, he believed, accompanied by a proportionate augmentation of their salaries. He must remind the House of the multifarious duties performed by the Post Office, and that in order to discharge them properly the Postmasters and Mistresses had to rise by candle light in the morning. When additional duties were imposed upon already hard worked officials it was incumbent upon the Chancellor of the Exchequer to see whether, with a due regard to the public revenue, he could not increase their remuneration. He should be sorry to move for a Return which would undoubtedly be very interesting—namely, a Return of the number of Postmasters and Mistresses who had been dismissed for dereliction of duty. He was afraid it would show that, owing to the very small emoluments attached to the duties, a very inferior class of persons had obtained the situations. He should add, however, that as far as he could learn the profits of the Post Office Department were not as great as the public general imagined, and many persons were in consequence led to make demands on it which it could not be fairly expected to meet. The gross revenue of the Post Office was £4,100,000, and as, on the other hand, the only expense entered against them in the public accounts was £870,000 for the packet service, many persons imagined that they must have a surplus of over £3,200,000. But that was not the case, and they had many other large charges to defray. In his opinion, it was very desirable that the public should be made acquainted, if it were possible, with the net revenue of the Department. But he repeated that he thought the present proposal a fair one, and he hoped it would meet with the favourable consideration of the Chancellor of the Exchequer.


said, it would be establishing a very bad system for our public servants, were we to pay them according to the amount of surplus realized by the office in which they were engaged, instead of according to the value of their services. The proposition of the hon. Member who moved the Resolution seemed reasonable enough—namely, that, if additional duties were thrown upon a class of public servants, they ought to receive additional remuneration. The principle involved in that proposition had, however, always been recognized and adopted by the Post Office. The question of remuneration of Postmasters had received a great deal of attention, and the desire always had been to remunerate them in proportion to the amount of work they performed, while taking care to avoid offering them any inducement to favour any class of depositors in order to improperly increase the amount of deposits and withdrawals. He did not think it would be desirable to pay them in proportion to the amounts deposited with them, because they would in that case have an interest in developing the business of the larger class of depositors as compared with the smaller class; and it should be remembered that it was essentially for the benefit of the humbler portion of the community the system had been established. The Post Office savings bank system was carried on by about 3,000 Postmasters in 800 head offices and 2,200 sub-offices. More than one-half of the business was transacted in the sub-offices, the masters being remunerated according to the amount of the work performed; exactly in the same manner as they were paid for the money-order business, with the single exception that they received £5 in the former, instead of the £4 for every 1,000 transactions which they received in the latter. In other words they received 1s. for every ten transactions. The work they had to do as between themselves and the depositors was to receive the money from the depositor and to enter the amount in the depositor's book. As between themselves and the General Post Office in London, they had to forward a memorandum, showing the amount of the deposit and the name and residence of the depositor, the whole of the accounts being kept in the Central Office in London. As the amount of remuneration varied with the quantity of work done of course it was but small at present, but in a few years it would probable equal that which the Postmasters received for the money order business. The total amount of remuneration at present derived on account of the savings bank business between the 2,200 sub-Postmasters was £4,000, as against £22,000 for the money order business. The remaining 800 Postmasters did not receive any special allowance for their labours either in the savings bank or the money order department; and the reason was that their salaries were fixed, and were fixed in proportion to the whole amount of the busi- ness it was thought they would have to discharge. The salaries might have been fixed before the additional duties were cast upon these Postmasters, but they were continually undergoing revision. It was open to any Postmaster who thought that he was underpaid to apply for a revision of his salary; that revision, if granted, would have special reference to the increased work which had been east upon him by the money order and savings bank systems, and his new salary would be fixed with reference to the whole amount of duty which he had to discharge. To show how continually this process of revision had been going on, he had been informed that the salaries of thirty of these 800 Postmasters had been revised since the commencement of the present year. Of course, in revising the salary of a Postmaster, it was necessary to consider whether the duties discharged by him in person had been increased or not. As regarded one-half of these 800 Postmasters, the work of their offices was done by clerks who were paid directly by the Post Office, and of course, if there was additional work to be done, it was provided for by increasing the number of clerks. They were the masters of the more important Post Offices in the country, men enjoying good salaries, and also receiving considerable, in some instances, very large sums indeed, as commission or poundage on the sale of stamps. The only class of Postmasters to whom the proposition of the hon. Gentleman could apply, so far at least as it implied that something had not been done that ought to have been done, were the other 400 masters of the minor head offices, whose salaries were small, and who had to do their work themselves, just as the Postmasters of the sub-offices had, and whose salaries had been fixed originally without reference to the increased duties which had devolved upon them since the establishment of the savings banks. In many of these offices, however, the extra business which had up to the present time fallen upon the Postmasters was very trifling, and all that they could claim would be an addition to their salaries at the rate of £5 for every thousand transactions. The addition which had been made to the salaries which had been revised had been at a higher rate than that. In case of a revision, it was sought to fix the salary with reference to the business which might be expected to fall upon the office within a reasonable time, and consequently the present addition was generally rather larger than was received by those whose extra remuneration was calculated according to the number of transactions. He did not say that the proposition of the hon. Gentleman was other than a reasonable one, but he assured the House that the Post Office were now acting upon it as far as they could.


said, he was glad the subject had been brought forward, as it appeared to him the Postmasters in several instances were not sufficiently remunerated. He wished also to call attention to the inconvenience and delay which were often experienced in Post Offices where there was only one clerk to perform all the duties of the office, and expressed a hope that such a state of things would be remedied.


said, he wished to ask for an explanation of the remarkable statement which had been made by the hon. Member for the Tower Hamlets that there had been a loss of £60,000 upon the investment of the funds of the Post Office savings banks, which did not appear in the account. If that was the case there must have been gross mismanagement. The Government only paid 2½ per cent, and they were receiving interest at the rate of 3½ per cent. The money might, in his opinion, be so invested as to pay 10 per cent. It might be the theory that whenever work was increased an addition was made to the number of clerks employed; but such had not been the case in the Post Office with which he was best acquainted. He thought that as the Government had made a considerable profit upon the deposits invested in savings bunks, they might make a more liberal allowance to the Postmasters who had to conduct the business. He hoped the hon. Member would persevere with his Motion.


said, that although the hon. Member for Oxford (Mr. Neate) did not exactly make his mouth water, he certainly greatly astonished him when lie talked of investing the money deposited in the Post Office savings banks so as to earn 10 per cent. If the hon. Gentleman could realize what he had promised, he believed that he should be quite safe in asking the House to grant him a sum of money in acknowledgment of so great a public service. When these Post Office savings banks were established, the Government cer- tainly held out the hope that they would be self-supporting; and he was bound to say that if the facts were before the House he believed he could show that no such egregious error had been committed as was supposed by the hon. Member for the Tower Hamlets (Mr. Ayrton.) He would not, however, venture to state upon his own responsibility that the House could safely assume the existence of the surplus to which the hon. Gentleman (Mr. Cave) who introduced the Motion had referred. If the process which he had recommended was to go on, some inroad might be made upon that surplus. The fact was, the system was so novel and so complex that it was as yet impossible to ascertain the precise nature of its results. If or, indeed, ought the existence or non-existence of a surplus to have an appreciable effect upon this discussion; because, in considering how such a surplus should be disposed of, the first question would be whether the Government could not increase the rate of interest to the depositors. He could hardly imagine that there was among the depositors in these banks such discontent as the hon. Member for the Tower Hamlets—who had indulged his old grudge against them by having a kick at them that night—had described. The effect of discontent would, he should imagine, be to diminish the number of depositors; but the fact was, that they were continually and incessantly increasing. He did not suppose that the hon. Gentleman opposite intended to take the opinion of the House upon this abstract proposition, to which, as an abstract proposition, no one could refuse his assent, especially as it had been shown by his right hon. Friend (Mr. Peel) that it was the great desire of the Post Office to act upon the principle which he desired to affirm. No less than 2,200 Postmasters were paid according to the amount of work which they performed; and the cases of those Postmasters who were not so paid, and on whom any additional duties were imposed, were undergoing constant revision. The cases in which extra work might have been imposed upon Postmasters to whom no extra remuneration had been given were those in which they received salaries, and the work was done by clerks paid by the Post Office. The only method in which those cases could be dealt with was by a revision general in principle, and applied to each case in succession. Though he quite concurred in the prin- ciple of the Amendment moved by the hon. Member, he believed that even the hon. Member himself would acknowledge that it was not possible to inaugurate any wholesale and sweeping change in the present system.

Amendment, by leave, withdrawn.