HC Deb 10 February 1870 vol 199 cc156-61

, in moving for leave to bring in a Bill to amend the Law relating to Friendly Societies, said: I am sorry to say that it is for a similar reason I have to introduce a Bill on the subject of Friendly Societies. The public have lost a most excellent and hard-working; servant in Mr. Tidd Pratt, who filled the office of Registrar of Friendly Societies and Savings Banks. The death of Mr. Tidd Pratt has, like that of Mr. Graham, induced me to consider what is the proper course to be taken in regard to the duties that he performed. The great merits of Mr. Tidd Pratt and the confidence he gained with the public threw a lustre over his office which possibly it did not of itself altogether deserve. The duty of the Registrar of Friendly Societies and Savings Banks is, in the first place, ministerial. It is his duty to register the rules of friendly societies, and, having done so, he had, in the next place, not exactly a judicial, but what may be termed a prophylactic duty, and to certify that those rules were in accordance with the law. When old rules were changed, and new ones were made, it was also his duty to certify them. With the exception of some of small judicial duties, a large portion of his time was taken up in transferring stock when no trustees were living, in assisting in winding up companies, and discharging duties which were rather matrimonial than anything else—assisting companies to change their names. The Government have carefully looked at the matter, and we have arrived at the opinion that we may altogether dispense with one of these duties, and that the principal one—namely, the certifying of these rules by the Registrar, which is attended in the Act with certain results. The societies whose rules have been registered have become as it were the favourites of the law, and are entitled to certain privileges and facilities, such as those of suing fraudulent employés and trustees which are denied to others that have not obtained certification. Now that is a thoroughly bad principle of the law. The law ought to have no favourites. It ought to treat all alike, and if societies are allowed to exist they ought to be treated with per- feet impartiality. If a society is legal it ought to have all the benefits and facilities which the law gives. If it is not legal it ought not to be allowed to exist at all. I do not know of any middle state of things, such as societies being allowed to exist, and yet being snubbed and looked down upon by the law. More than that; the certificate of the Registrar of Friendly Societies went no further than to show that the rules of the society did not transgress the law. It did not show in the least that the society was well organized, or was effectual for the purpose. It did not show that the rides were good, or that the actuarial calculations were sound. Nor did it give the societies the slightest protection, because it has been held that if the Registrar certified that to be law which was not law, his certificate did not make it law. It was not merely negative in its effects. It did very little good to societies, and it did a great deal of evil. By obtaining a certificate of a man of the known ability and eminence and the judicial impartiality of Mr. Tidd Pratt, certain societies obtained an amount of credit which they did not deserve. Poor and ignorant people who principally supported these societies believed that the certificate meant that the society had received the approbation of the Government, that it was founded on sound principles, and they might safely invest their money in it without the risk that attached to other societies not so certificated. So that founded with the best intentions and administered in the best manner, this paternal interference on the part of the Government with these societies has been most mischievous. Instead of pretending to give them this assistance and security we think it would be better to withdraw the pretence of doing it, and to leave these societies to stand or fall on their own merits. Their stability depends on the character, honesty, and good conduct of their managers, upon the soundness of their actuarial calculations, and the goodness of their constitution and rules, and not whether they do or do not transgress a long and technical statute. Therefore, I do not believe we can do a greater service to these friendly societies than to withdraw from them the certification of their rules, which is a more illusion I propose that whatever benefit these societies derived from having their rules certified they should continue to receive from merely registering them, and putting the public in the position of being able to inspect them, and thus to form their own opinion upon them. There can, then, be no pretence for saying that the Government have looked into the matter and have satisfied themselves that the society was sound and might be relied upon. Every society would stand on its own merits, and we may then hope to prevent the increase of societies so unsound and so calamitous as many of these have been. There are many things to suggest for the amendment of societies of this kind; but this is the first step. The result of the Bill will be that the greater part of the duty of the Registrar will be at an end, and we do not, therefore, propose to fill up the office of Registrar of Friendly Societies and Savings Banks. The ministerial duty of registering these societies will be performed by the Board of Trade, which is willing to perform it. There are other small duties which we shall discharge without additional expense to the public. The main point is to do away with a very injurious piece of Government interference; but, of course, it will not be altogether disagreeable to know that the result of the Bill will be a saving of £1,500 a-year—£1,000 to the Registrar, and £500 to his chief clerk. The fore-going is the only piece of patronage which the Chancellor of the Exchequer possesses, and I may, therefore, claim to be disinterested in the matter. The effect of our interference has been to do what was never intended, and to give a spurious credit to certain societies. It has done but little good, and a great deal of mischief, and we cannot do more wisely than to withdraw from it.


confessed that he felt satisfied with the tone of the Chancellor of the Exchequer's first observations. The right hon. Gentleman had pointed out with great justice that the Registrar's certificate seemed to him to convey a sort of fictitious value. But when the right hon. Gentleman told them that he proposed to do away entirely with the office he (Mr. Corrance) did not fool the like degree of accord. He thought the office of Registrar was invested with most important functions, for it had given the public much information relative to these societies which was extremely valuable, and which could not have otherwise been obtained. Lord Lichfield drew up a Bill relative to these societies, but he did not succeed in passing it through the House of Peers; and he (Mr. Corrance) had served on a Committee, the result of whose labours was an opinion that a Royal Commission ought to be issued to inquire into the subject at large. The right hon. Gentleman had stated that he was opposed to Government interference with these societies; but there were some of them which could not work out their rules, and they required the protection of such an officer as they had just lost. In the Bill about to be presented to the House he trusted that some substituted machinery would be found to make good the loss which the public had sustained in the death of that officer whose name they were now about to erase.


said, he felt some surprise that a Bill abolishing the connection of Government with the friendly societies was introduced at such a moment. In what the right hon. Gentleman had had said on Mr. Pratt's assiduity, knowledge of law, and able fulfilment of the duties which devolved upon him, he had merely done justice to that officer; but the right hon. Gentleman, he feared, greatly underrated the benefits which the working classes of the country had derived from the operation of those rules which, in fact, formed the code of the friendly societies throughout the country. He agreed that it was desirable to minimize, as far as possible, the paternal system of Government; but it should be remembered that in connection with these societies there were those who early in life had entered into contracts which affected the whole of their lives, and to whom, in their state of comparative ignorance, it would be difficult to explain an entire change of system. It was, therefore, desirable that some indication should be given as to the proposals of the Bill upon this head. The way in which friendly societies had developed and spread was, he thought, very creditable to the country, and the Government interference which had taken place had not boon found altogether useless. It would certainly be a startling thing to immense numbers of persons to find that prop suddenly taken away.


said, he thought they ought to be obliged to the Govern- ment for bringing in this Bill. Over and over again he had known cases in which persons who had lost what to them were large sums by payments to those societies accounted for their having so invested by saying—"It was a Government society; it was according to the Government rules, and we thought it was all right."


asked the right hon. Gentleman to state the sources of information upon which he was acting in bringing forward so unexpected a measure. Undoubtedly, cases like those mentioned by the hon. Member for Finsbury (Mr. Alderman Lusk) were only too familiar; but the amount of good which the societies had accomplished under the superintendence of Mr. Tidd Pratt was very great indeed, and nothing ought hastily to be done which would weaken the confidence of the public in existing societies.


The facts which I have stated are tolerably notorious. I am not able to go into the list of authorities; but there are the Reports of the Registrar from year to year giving a most dismal picture of numerous and notorious failures of these societies. I think these are facts that ought to lead any Government that respects itself and is anxious to do what is good for the people carefully to consider whether it is altogether free from blame, and whether a continuance of the connection is likely to lead to good or otherwise. In answer to my hon. Friend the Member for Winchester (Mr. Bonham-Carter), I would state that the Bill is strictly limited to the office of Registrar of these societies, and that we do not meddle with any of the wider subjects to which he has alluded. It is not within my Department to deal with these societies, though there are some that I might not have been sorry to have tried my hand upon, and I think there is a good deal which might be done for them by legislation, such as preventing persons subscribing for benefits which it is utterly impossible they can ever receive. This, however, is a tiling which we have never attempted to do. I do not think I am fairly chargeable with doing injury to existing societies when I only withdraw a prop which is very much like the reed that pierced the hand of him who trusted to it.

Motion agreed to. Bill to amend the law relating to Friendly Societies, ordered to be brought in by Mr. CHANCELLOR of the EXCHEQUER and Mr. STANSFELD.

Bill presented, and read the first time. [Bill 14.]

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