HC Deb 26 April 1869 vol 195 cc1581-2
MR. CAWLEY

said, he would beg to ask Mr. Chancellor of the Exchequer, Whether he is willing to give to the trustees of ordinary Savings Banks authority to receive from any one depositor the same maximum amount in any one year, and the same aggregate amount which it is proposed by the Bill now before the House to confer upon Post Office Savings Banks?

THE CHANCELLOR OF THE EXCHEQUER

Sir, I see a great objection to the proposal which the hon. Member makes. The objection forms itself in this way. We pay to the Post Office Savings Banks, on deposit £2 10s. per cent interest, and to the ordinary savings banks £3 5s. per cent. Now, the interest of £3 5s. per cent causes a loss to the Government, and the general tax-payer is, to that extent, a loser by the transaction, because it is the nature of this business to compel us to buy stock when it is high, and to sell it when it is low. I do not think it desirable, therefore, for the Government to increase a business which is undertaken for the benefit of a class, however deserving, but by which the Government is an actual loser. Then we offer another alternative—the Post Office Savings Bank, which gives to the depositors the absolute and ample security of the Government for every farthing invested; for, unless the Government becomes insolvent, they are sure to be paid. The ordinary savings bank does not give that security. It gives to the manager very sufficient security, but there is no security that the manager will not defraud the depositors, and if he does, the depositors have no remedy against the Government. The matter, therefore, goes to this—that we are giving a larger interest to tempt persons to take the worse security. Ordinary savings banks—most excellent institutions of their kind—have really become now of very questionable advantage. When we consider, too, how much the poor lose by trusting their money with imperfect security, I think it very desirable, without taking any unfair or unreasonable course against the ordinary savings banks, that we should endeavour to get the money of the poor placed where it would be perfectly secure.

MR. HIBBERT

said, he would beg to ask Mr. Chancellor of the Exchequer, If he is aware that the expenses of the Post Office Savings Bank is only 14s. per cent?

THE CHANCELLOR OF THE EXCHEQUER

I do not see how that will affect my reply.