CLASS VI. (Hansard, 24 February 1899)

§ MR. DAVITT (Mayo, S.)
I have been requested by some of my honourable 574 friends to ask that this Vote be not taken to-night in their absence.

§ THE FIRST LORD OF THE TREASURY
I do not press it.

§ DR. CLARK
We had this brought on last year, when the Chancellor of the Exchequer was strongly pressed to deal with this matter with a view to making the banks self-supporting. I am as much in favour of that as any man can possibly be. I do not see why we should tax one portion of the community for the benefit of another. I do not see why one class of banks should be allowed to draw upon the public exchequer while other bankers are unable to do so. I submit that the Friendly Societies and Trustee Savings Banks should be in a position to carry on their business alone, and ought not to have to fall back on the tax-payers for the purpose of making up any deficiencies that may arise. When I raised this question on the last occasion, the Chancellor of the Exchequer thoroughly agreed with me, and I now want to know whether anything has been done in the matter.

§ *THE CHANCELLOR OF THE EXCHEQUER
Nothing can be done in the matter without legislation But I may say that with regard to the Post Office Savings Bank something has been done in reducing the expenditure on management, the cost of which is very considerably larger than that of managing the Trustees Savings Bank. A considerable reduction has been made during the past year. I very much agree with the honourable Member in principle, but after all it is a, question of degree. For many years the Exchequer has received a considerable profit from the Post Office Savings Bank. Now we are beginning for the first time since 1861 to incur a loss, and the Act provides that in such a case Parliament must make up the deficiency. Now, the deficiency, which last year amounted to £9,678, was on an income amounting to £3,231,000, so the honourable Mem- 575 ber will see that the deficiency at present is small, although, no doubt, by reason of the increasing price of the investments in Consols, etc., which by law we are obliged to make, this deficiency may tend to increase. Still I hardly think the time has come when Parliament should be asked to reduce the interest payable to depositors. The deficiency is larger in the case of the Trustee Savings Banks. It amounts to £37,394 on an income amounting to £1,368,000. I am carefully watching this matter, and as soon as I think that Parliament ought to interfere in justice to the general taxpayer, by reducing the rate of interest paid to depositors, I shall feel it my duty to apply to Parliament for powers for the purpose.

§ DR. CLARK
As far as the Post Office is concerned, I know we are helpless, but in regard to the Trustee Savings Banks they are practical competing institutions, and are often carried on merely for the sake of the officials. The State has now established its own Savings Banks, and I think it should have nothing to do with outside Savings Banks, which are practically private concerns. As far as Friendly Societies go, Industrial Insurance Companies are doing exactly the same business as they are, and yet we are giving them special advantages; surely if it is right that one class of society should have this advantage it is equally right that it should be extended to the other class. I am sorry that these changes cannot be made by administration, but require legislation, and I hope the Chancellor of the Exchequer will soon be able to carry out this much needed reform.

§ *MR. WEIR
Is there any possibility of legislation this year with regard to the Trustee Savings Banks? As to the Post Office Savings Banks, I should like to point out that the Post Office has for many years reaped a considerable profit, and if the business is to be conducted on business-like principles we must expect that in some years it will be good, and in others bad, and the good years must make up for the bad ones. I certainly should object to any reduction in the rate of interest to depositors. I think it would be calamitous to reduce it. As to the 576 Trustee Savings Banks, the Government support should be taken away from them, and they should be allowed to sink or swim on their own merits.

§ *THE CHANCELLOR OF THE EXCHEQUER
I should be very sorry to adopt the opinion of Trustee Savings Banks expressed by the two honourable Members. I believe they are as a rule managed very well at the present time by gentlemen who devote a great deal of time and trouble to the work, which is really a philanthropic and useful one. I believe that these banks have proved J very useful in the places in which they exist. A considerable part of the expense we have to vote, namely, £4,000 a year, is due to the necessary cost of the Inspection Committee, which was appointed subsequent to the report of the Committee of the House of Commons (on which the Member for Islington rendered such valuable service) in order to watch the progress of the institutions, and see that they are properly managed. As to legislation, I think that whatever is done in the matter the Trustee Savings Banks should rot be dealt with apart from the Post Office Savings Bank.

§ MR. MADDISON (Sheffield, Brightside)
I am pleased to hear the Chancellor of the Exchequer adopt the attitude he has done with regard to these Trustee Savings Banks. I must dissociate myself altogether from the unfair attacks made by the honourable Member for Caithness, who suggested that they were chiefly run in the interests of officials. I know of one bank in Hull which has the entire confidence of the working classes, and in them the Trades' Unions prefer to invest their money, because the Chancellor of the Exchequer is not able to give them the facilities which they enjoy at this bank.

§ DR. CLARK
Yes, at the expense of the general taxpayer.

§ MR. MADDISON
I can only repeat that these banks are doing really good work in the promotion of thrift, and that they enjoy the confidence of the working classes. I regret that this attack should have been made upon them.

§ DR. CLARK
A dozen years ago I sat upon a Select Committee of this House upon this subject, and the report 577 and evidence are open to the inspection of my honourable Friend. I wish to point out that these banks are now costing us £4,000 a year. I made no attack upon them, but I merely said that some of them were in the position I have indicated, and there was plenty of evidence given before the Committee that some are very badly managed, others admittedly are well managed, and Hull may be among them.