§ [SECOND READING.]
§ Order read, for resuming Adjourned Debate on Question [10th July] "That the Bill be now road a second time."
§ Question again proposed. Debate resumed.
§ MR. CALDWELL (Lanarkshire, Mid)
said that on the previous night the First Lord of the Treasury had stated that this Bill was of an urgent nature, but for the life of him he could not understand in what way its urgency was such as to justify its being put in front of the Agricultural Holdings Bill. It was a measure usually brought in towards the end of the session, and, indeed, usually ran along with the Appropriation Bill. The Government might have reasons of their own for wishing to press the Bill on, but certainly the reasons had nothing to do with the Bill itself. The present Bill differed from previous Bills in that it nominated the Public Works Loan Commissioners, who held office for five years. The list was practically the same as before; it containing only two changes, the new Commissioners being Horace Alfred Damer Seymour and Colonel Lock wood. Why should an English Member, Colonel Lock wood, be put in the place of a. Scotch representative, Lord Napier? He should also like to be informed what duties these Commissioners performed. How often did they meet? For all the House knew, they never met at all. As Parlia- 1232 ment was here asked to reappoint certain people for a further five years, some information should be given as to their attendances in the past. Another point upon which the House was entitled to information was as to the extent Parliament exercised any effective control over the giving out of these moneys. This was a most important Department, as it was necessary to see that the security was good when a loan was advanced, as otherwise large amounts of money had to be written off. This should be a real business Department, and the House wanted to know that these names wore not merely ornamental, but that the men were giving their attention to the work in a businesslike way. With regard to the sums to-be written off also this was a most important Bill. If such a Bill was brought forward and allowed to pass without discussion, what would be the result? The Department lending the money would find they had nothing more to do than to put a schedule to a Bill, and the Secretary to the Treasury would get it slipped through the House after midnight without discussion, with the result that the Commissioners would find it an extremely simple thing to write off debts that were a little troublesome to them. No explanation whatever was given why these amounts were to be written off; the House was simply asked to agree, and at five minutes to twelve an attempt was made to rush the Bill through. He would not take each of the items, but there was one in regard to which certainly some explanation should be given. Under the Purchase of Land (Ireland) Act, 1885, a man named Fitzgerald got a loan of £3,000 from the Irish Land Commission. The amount repaid was only £200 9s. 10d., and the House was now asked to remit £2,799 10s. 2d. That was a big order, especially without a single word of explanation. Other sums proportionately heavy were also to be written off. There was a man named Lambert who borrowed £500, repaid £182 0s. 10d., and the House was asked to write off £317 19s. 2d. Again no explanation was given, and the Commissioners were given the idea that they could put anything they liked in these schedules, that there would be no supervision, and that nobody would call them into question. Public money should not be allowed to be written off in that way. 'The Department should feel that there 1233 was a supervision exercised, and that the Government might be challenged with regard to any particular case. The total effect of Part 1 of the schedule was that loans had been granted to the extent of £2,1710s.7d., of which only £541 17s. 8d. had been repaid, and the House was asked to write off £1,512 17s. l0d. It was no wonder borrowers in Ireland did not pay the money. He would be perfectly astonished if it wore otherwise, when such lists could be seen year by year, showing that borrowers could get the whole or two-thirds and so on written off. There was one case in connection with the Fishery Board for Scotland. The sum advanced was £114; the amount repaid and realised by sale of the boat was £90 7s. fid.; all that was asked to be written off was £23 12s. 6d. Loans for fishing boats were always precarious, as a storm might arise and the boats be lost or the men drowned; but, notwithstanding that, there was only this one case of £23 12s. fid., and five men wore concerned in that. Therefore, so far1 as Scotland was concerned, there was nothing unreasonable in the loans; but what was to be thought of a case in which only £200 was repaid out of £3,000? It was not in the interest of the Treasury that this writing off of loans should be allowed to pass perfunctorily through the House, and he intended that it should not. He warned the Secretary to the Treasury that when the Bill got into Committee an explanation would be required of each individual item, and every one of the items should be thoroughly probed to the bottom, so the right hon. Gentleman could get his material ready. Owing to the circumstances under which the Bill was put forward on the previous evening the hon. Member for East Mayo had lost his right to speak on the Second Reading, and in order to restore to the hon. Member his right to speak he would move that the Bill be read a second time that day three months.
To leave out the word 'now' and at the end of the Question to add the words upon this day three months.'''—(Mr. Caldwell.)
§ Question proposed, "That the word 'now' stand part of the question"
§ MR. DILLON (Mayo, E)
This, is not the first time I have directed attention to 1234 the form of this Bill, and the point to which I desire specially to direct attention is the practice of putting into the schedule long lists of arrears which are to be written off without any item of information being given as to the character of the arrears or as to the reasons for writing them off. There are many cases in which unanswerable reasons exist for writing off the amounts, but we do not know which are those cases. There is a new principle introduced in the second part of the schedule. The practice in previous Bills has been to put in a list of the items to be written off, but wherever those items were large in amount they were always loans to public authorities. Where there were arrears to be written off in the case of private individuals they wore always either of extremely long standing or small in amount. The first item in the schedule is that of Giles Eyre Lambert, who obtained £500, and is to have £317 19s. 2d. written off. The period of that loan is 1847, and one might naturally conclude the time had come when that should be written off as a bad debt. But you have here the case of a gentleman named Fitzgerald, who borrowed under the Purchase Act of 1885 the sum of £3,000. He could borrow under that Act for no other purpose than that of buying a large valuable holding which the inspectors of the Land Commission must have certified as being ample and good security for the loan. Now, at the end of fifteen years, we are asked to forgive this gentleman £2,799.
§ THE FINANCIAL SECRETARY TO THE TREASURY (Mr. HANBURY,) Preston
The. hon. Gentleman is quite mistaken. We do not forgive the debt; we simply write it off as an asset of the Local Loans Fund; the debt is still recoverable.
§ MR. DILLON
That, indeed, is a new and extraordinary principle. What is the hurry for writing off Mr. Fitzgerald's debt? I really think after that answer we are entitled to some explanation. We want to know why a man who has borrowed so large a sum on presumable excellent security at so recent a date is to have this amount written off. This is an enormously important question, because millions have been lent on precisely this sort of security, and the process is going; on at the rate of about £2,000,000 1235 a year. If this debt is recoverable and there is a prospect of getting it, why should it be written off? What has become of the holding? By the terms of the Act of 1885 the holding must have been worth much more than the amount advanced. The principle of the Act is that there must be a margin, and £3,000, according to the principle of the Act, ought not to have been lent on a holding worth less than about £5,000 to the tenant. We are therefore entitled to assume that the loan is secure, and we want a full explanation of this matter.
MR. LLOYD-GEORGH (Carnarvon Boroughs)
The question raised is a most important one, and the case referred to by the hon. Member for East Mayo is one of the most extraordinary I have ever seen. First of all, there is a sum of £3,000 advanced, there is only £200 repaid, and we are asked to write off the remainder. Surely we are entitled to have some explanation of such a transaction. If we assume that not more than two-thirds of the value of the security would be advanced, that means that the holding would be worth about £4,000. It is now discovered that owing to overvaluation or some other reason that £3,000 is represented by no asset at all and although the amount may be recoverable as a personal debt, the Treasury have come to the conclusion that it is no good, and it is to be practically, though not nominally, wiped out in this way. There ought to be some explanation. We should not be called upon year by year to get up and say, "Can you explain the ease of James Collins or Michael O'Brien?" The House of Commons does not lend itself to that sort of thing. There ought to be a report sent to the House of Commons every year before the Bill is read a second time, each individual trans action being explained, and if any explanation was not satisfactory we could bring it up when the Bill was considered. The possibility is that these things will go on increasing, and there is a great deal in the point as to the change in the character of the debt we are asked to wipe off. Up to the present we have been asked to wipe off debts for public works, by which we may assume some good has been done, even though the locality may not be rich enough to repay the sum advanced by the Treasury. But here we are asked to wipe out debts 1236 incurred in the interests of private individuals in different parts of the kingdom. That, I think, makes it all the more necessary that a report should be made in regard to this matter. There is one local point to which I desire to call attention. I find amongst the Commissioners every part of the United Kingdom represented except Wales. I think the right hon. Gentleman might consent to Wales also being represented on this Hoard. When the matter was brought forward on a previous occasion the objection was that the number of Commissioners was limited. But this is an Act of Parliament, it is not merely an administrative Act, and if the right hon. Gentleman consents he can easily increase the number of Commissioners by one. There is not one of the present Commissioners to whom I object, but certainly there should be one representative of the Principality, one very good reason being that there is not a part of the country which receives less from the Local Loans Fund than the Principality of Wales; and I am sure there is no part of the country which deserves more from the fund. A great deal could be done to restore the fishing industry in that part of the country, and that is a very important industry from an Imperial point of view. The Navy used to draw some of its best men from that part of the country in the past, but it does nothing of the kind at present. The industry is dying out, and we have constantly asked the Treasury to assist us by loan or by grant to develop the fishing industry, but without success. Wales ought to have one representative at least to see that fair play is done to that part of the coast, and I should like to know whether the right hon. Gentleman the Secretary to the Treasury will not consent to increase the number by one, and that one to be a Welsh. Member—it does not matter from which side of the House he comes.
§ MR. HANBURY
The hon. Member for Carnarvon has made two suggestions, and I quite agree with what he said in regard to each of them. He first suggested that the House should have more information with regard to the debts that are written off, and an explanation of the reasons for taking that course. That is a very reasonable suggestion, and I will undertake that in future there shall be 1237 laid before the House, if possible before the Bill is brought on for Second Reading, a complete statement showing our position with regard to the various items. The hon. Member also asked me with reference to the appointment of a distinctly Welsh Commissioner. Although the number of Commissioners is not actually limited, as a matter of fact it has always been exactly the same, about sixteen, I think. I am told there would be some objection to increasing that number; but I have boon in communication with the Commissioners, who are to a great extent in sympathy with the suggestion of the hon. Member, and I have every reason to believe that should a vacancy occur they would be very glad to consider the suggestion he has made—that a Commissioner representing Wales should be placed upon the list. As the hon. Member knows, the names come before Parliament only once every five years, but any vacancies which occur during that period are filled by the Commissioners themselves. Therefore, their agreement that a Welsh member might very well be appointed is one which they will probably have an opportunity of carrying into effect. The hon. Member for Mid Lanark is, I think, a little unreasonable. He complains, first, that we brought on the Bill at live minutes to twelve at night: and then he complains that we set it down as first Order for to-day. It is, therefore, a little difficult to see what would satisfy him, but I will do my best to facilitate matters by giving an answer to the points he has raised. He asks, in the first place, where is the urgency for this Bill. The hon. Member takes a considerable interest in the needs of various localities, and he must know that we are constantly receiving applications from local authorities for loans; but as the powers of last year are exhausted, those loans cannot be granted until this Bill is passed, it is, therefore, in the interest not so much of the Treasury as of the local authorities that we are pressing this Hill. The hon. Gentleman then raised several points which are really Committee points rather than matters to be discussed on the Second Reading, and as he has promised to call my attention to a great many of these points in Committee, perhaps I ought to give him the opportunity to raise them twice over. There is, however, one important case, but it is not one of remiss: on. There seems to be an idea on 1238 the part of the hon. Member for East Mayo, and even on the part of such a financier as the hon. Gentleman opposite, that we are actually wiping off' these debts. We are doing nothing of the kind; we are simply writing them off as assets of the Local Loans Fund. That does not by any means mean that they are not recoverable, or that we shall not do our best to recover them. As matter of fact, within the last ten years a large number of these loans which have been written off as assets of the Local Loans Fund have been recovered and paid into the Exchequer.
§ MR. HANBURY
I really cannot carry all these figures in my head. I ought to mention the particular case of Fitzgerald, which has been referred to. It is. not a recent loan at all; it was considerably before 1889 when he fell into arrear with his annual payments. What has happened is this. We could find no purchaser of the land for several years, and now it has been leased by the Land Commission for a period of twenty years at £58 a year, which, I am told, is the full letting value of the land. That being so, is it fair to the Local Loans Fund, or the local authorities who desire to borrow from that fund, that that money should be lying idle? It is, therefore, being wiped off the assets of the fund; but we have the security, and meanwhile are getting the rent. Directly the farm can be sold, the whole of the proceeds will be paid into the Exchequer. This is distinctly a case where we have every prospect of recovering, at any rate, a large portion of the loan. The only other point raised by the hon. Member was the complaint that there wore more Irish than Scotch loans remitted. I should have thought that was rather complimentary than otherwise to his country, but be seemed bitterly to complain that Scotchmen did not borrow money and then find themselves unable to repay it. I really cannot enter into the frame of mind of the hon. Member. I think Scot- 1239 land is to be congratulated on the fact that it does pay up its debts.
§ MR. HANBURY
We do our best to make Ireland pay up. If the hon. Member wishes us to be even more hard than we are upon Irish borrowers, I must confess I do not take so hard a view of the case as he does. But when he supposes we are remitting these loans, we are doing nothing of the sort; and with regard to a large number, we are recovering certain amounts of the sums so written off.
§ MR. ALFRED THOMAS (Glamorganshire, E.)
While I very much appreciate the tone in which the right hon. Gentleman has replied to the hon. Member for Carnarvon, I must say that no argument has been advanced why the number of Commissioners should be confined to sixteen. We are not very anxious to wait for dead men's shoes; moreover, we want a representative appointed by the House of Commons, and there is no reason whatever why Wales should not have one representative on the Board.
§ *SIR F. S. POWELL (Wigan)
I feel under an obligation to hon. Members for directing attention to this Bill. I have watched these Public Works Loans Bills and Bills of a kindred character, and I have discovered that year after year there are debts written off without any explanation whatever or cause shown. I have long thought it a very unsatisfactory condition of affairs, and I rejoice to hear the statement just made by my right hon. friend that that system should come to an end. I certainly think it would be in the public interest that debts should not be written off so long as they may fairly be regarded as recoverable. The wiping off of a debt of this kind shows a certain Amount of carelessness in the advance, and that carelessness ought to be, I will not say rebuked, but carefully watched by the House of Commons. I am sure that although we have important business before us the time has not been wasted in this short discussion of a question which, in principle if not in figures, is one of very great importance.
§ MR. JONATHAN SAMUEL (Stockton)
It is very essential that when 1240 accounts are written off in this way some explanation should be given. In municipal life every precaution is taken before accounts are written off, and the same should be done with regard to a Government Department. It was, therefore, an extraordinary piece of policy on the part of the Government to move this Bill at five minutes to twelve last night when such large amounts of money are involved. I quite agree that it is very unfair that Wales should be excluded from having a Commissioner, because when loans are applied for by a local authority the local knowledge of any particular Commissioner must always carry great weight with the other Commissioners. Wales is therefore entitled to have a representative, and I hope that in Committee the hon. Member for Canarvon will move the addition of a gentleman from Wales. The point I wish particularly to raise is, that the Secretary to the Treasury has not fully explained the mode of writing off these accounts. The right hon. Gentleman said there was a probability of the amounts being recovered hereafter. This Bill, like all other Bills of the Government, requires reference to two or three other Acts of Parliament before it can be understood, and Section 3 of the Bill refers to Section 15 of the principal Act of 1887. There I find that the mode of preventing loss to the Exchequer is a most extraordinary one, and one which is very unfair upon those local authorities and private individuals who do pay their debts to the Exchequer. In Section 11 it states that there was a sum estimated at £12,000,000, or thereabouts, which had been lost to the Exchequer through the non payment by local authorities and individuals of the principal of local loans. How are these losses met? They are met by a restitution fund. Under Sub-section 1 of Section 11 of the Act of 1887 the Local Loans Fund has to set aside every year £130,000 in quarterly instalments, to be paid to the credit of the National Debt Commissioners, to prevent the National Debt Commissioners suffering any loss by the non-repayment of these loans. This is very unfair to the local authorities who do pay their debts, because if the Local Loans Fund can afford to set aside £130,000 a year, these sums ought to be enforced and the amount go towards the reduction of the interest charged to the local authorities. 1241 I referred last night to the case which has been brought up to-day. I should like to know whether in the Report we are to have we shall be told how much this man Fitzgerald received more than he ought to have received on this farm. That is really the point.
§ MR. JONATHAN SAMUEL
The hon. Member for East Mayo says he had four times its value. If that is the case, I ask how is it possible for these tenant farmers who become the owners of their land under the Purchase Act to pay the interest and principal on that same land? In the schedule of loans by the Com- missioners of Public Works, Ireland, there is a total amount advanced of £2,171, of which only £541 has been repaid, so that there is a loss, for the time being, to the Exchequer or the Local Loans Fund of £1,512. I think we are entitled to receive from the Chancellor of the Exchequer some information as to the state of this restitution fund, and whether the amount is equal to meeting the losses which the National Debt Commissioners are bound to suffer under this system. In any ease, we were justified in opposing this Bill last night and to-day, and if the hon. Member goes to a division I shall go into the Lobby with him as a protest against the action of the Government in bringing this matter forward in the manner they have.
§ MR. GODDARD (Ipswich)
In his incomplete explanation of the Bill, the Secretary to the Treasury has spoilt his own arguments altogether. The right hon. Gentleman said the Treasury were now receiving from the estate to which reference has been made a vent of a little under £60 a year. If, however, £00 a year is the full value of the farm, how in the name of reason came a loan of £3,000 to be advanced upon it? That is about fifty years purchase; so that, on the face of it, either the right hon. Gentleman's explanation is incomplete, or it is proved that very great rashness was shown in advancing the money. I hope some further explanation will be given on this point, because if that is the way in which these loans are made it is very clear there will have to be a great many of these cases in the future in which amounts will have to be written off. I strongly 1242 support the contention that Wales should have a representative on the Commission. The right hon. Gentleman has given a sort of promise with regard to the matter, but it would be much more satisfactory to the Welsh Members if the right hon. Gentleman could see his way to add the name of a Welsh Commissioner at once instead of waiting until such time as a vacancy occurs.
§ SIR DILLWYN LLEWELYN (Swansea Town)
I rise to support the appeal made by the hon. Member for Carnarvon. At the present moment it is most desirable that some special attention should be paid to the claims of Wales, and that there should be on the Commission some gentleman who thoroughly understands the needs of the Principality. Quite recently the county of Monmouth has been called upon to find its own lunatic asylum, and the counties linked with it in the past—Brecon and Radnor—have had to provide similar institutions for themselves. They have made application to the Public Works Loans Board for a grant of money for this purpose, and, although it has been allowed in the case of Brecon, it has been refused in the case of Radnorshire. I hope the decision is not a final one, because I think that when two counties similarly situated make such an application they should be treated as nearly equally as possible, and equitably as well. I am not going to make any complaint as to the rate of interest claimed by the Public Works Loans Board, because I am perfectly well aware that that rate has recently been raised, but I do ask that the claims of Radnorshire should be considered by that Board and by the Treasury; and I may add that there is a feeling that, hitherto, they have not been acceded to simply because Wales has no direct representative on the Board.
MR. PHILIPPS (Pembrokeshire)
I hope that the Chancellor of the Exchequer will speak on this matter, and will promise that the very reasonable demands put forward by some of my colleagues from Wales shall be conceded. The hon. Member who has just spoken has pointed out that certain Welsh demands had been refused. Perhaps the refusal has been just; but I think Wales can scarcely be expected to consider that its claims are fairly listened to when it is realised that of the sixteen 1243 Commissioners not one has any connection with the Principality. I understand that the only reason given by the Secretary to the Treasury for not appointing a Welsh Commissioner is that the body of Commissioners has always consisted of sixteen members. But sixteen is not a mystic number; it is no better than any other number; and I do not think that it is fair that the Government should put us in the position of having on another stage of this Bill to object in turn to each of the gentlemen nominated. We have no wish to prolong this debate, and we are perfectly ready to let the Bill go through at once if the right hon. Gentleman will give us a pledge that he will either get one of the gentlemen nominated to withdraw in the interests of someone from Wales, or that he will add another member to the Board. Considering the fact that the Commissioners have at their disposal a sum of six millions sterling from England and Scotland, and of eight hundred thousand pounds from Ireland, I do think the right hon. Gentleman might make the concession for which we are asking.
§ THE CHANCELLOR OF THE EXCHEQUER (Sir M. HICKS BEACH,) Bristol, W.
The House must remember that these Commissioners are unpaid, and I think that both the House and the country are deeply indebted to them for the important work they perform. I entirely agree with what has fallen from the Members for Wales that there ought to be among the Commissioners one who is acquainted with that part of the United Kingdom, and I will see them on the subject before the Bill reaches the Committee stage, with a view to their appointing someone. The hon. Member for Stockton is entirely mistaken with regard to the restitution fund. The hon. Member objected to that fund on the ground that it is unfair to make existing and new borrowers pay old debts. In 1897 the same view occurred to me, and at my instance Parliament abolished the restitution fund altogether, making provision for the application of the surplus income of the Local Loans Fund so as to provide against default. Every year the accounts of the Local Loans Fund are presented to Parliament, and I think they show that the result has been by no means unsatisfactory.
§ MR. FLAVIN (Kerry, N.)
said he thought the House was entitled to much more information than was given in the schedule of this Bill. It was a remark able fact that absolutely no information was forthcoming with regard to Irish loans beyond the mere name of the borrower. In the case of Scotch loans they were told the district in which the loan was granted, and he ventured to assert that they ought to have in all cases full information as to the circumstances under which the money was advanced Now, with regard to the case of Mr. Fitzgerald—
§ *MR. SPEAKER
Order, order! I would remind the hon. Member that these minute details are more profitably discussed in Committee, and not on the motion for the Second Reading.
§ MR. FLAVIN
said his object in mentioning them was to enable the Minister in charge of the Bill to obtain the necessary information by the time the Committee stage was reached. He thought he was entitled to ask why a sum of £3,000 was advanced upon a farm the annual rent of which was £58.
§ MR. HANBURY
I will undertake that full information shall be laid before the House before the Committee stage is reached.
§ MR. FLAVIN
said that, so far as he could sec, this particular transaction must result in a loss of at least £2,000. The tenant got no advantage whatever from the money advanced. The landlord had pocketed it, and yet the tenant was liable to have proceedings taken against him and to be made a bankrupt. He hoped that in future, in regard to Irish loans at any rate, they would be informed not only of the amount of the loan but of the name of the borrower, and of the district in which he lived. Seeing that the right hon. Gentleman had promised to give that, he thought the best thing they could do was to conclude the discussion.
§ Amendment, by leave, withdrawn
§ Main Question put, and agreed to.
§ Bill read a second time, and committed for Monday next.