§ Order for Second Reading read.
§ The FINANCIAL SECRETARY to the TREASURY (Mr. Baldwin)
I beg to move "That the Bill be now read a Second Time."
This Bill of one clause is to give effect to one definite purpose, and it imposes no charge of any kind. It makes no alteration in either the status or the amount of the note issues in Ireland. It is drafted at the unanimous request of the six banks which issue notes in Ireland. It may not be generally known to Members in Great Britain that the Irish practice is very far behind the practice in this country or in our Dominions, in that even to this day Irish bank notes may be presented in any amount for payment at any branch. In Great Britain they are legally presentable for payment only at the head offices of the banks. It is proposed by this Bill to bring the practice in Ireland into conformity with the rule in every other part of the Empire. The reason why this step is necessary at the present time is this. Every hon. Member knows that one of the things we have to watch with the greatest care at present is any increase in the issue of currency notes, and that every step 1396 should be taken that can be taken to keep as low as possible, having regard to the amount of trade in the country concerned. The result of the Irish banks working under this law of over 90 years ago is that all the banks have to keep a much larger amount of currency in each of their branches than they would have to keep if the practice in regard to payment was the same in Ireland as in this country. In other words, the Bill will release a certain amount of currency. Anything that helps to-day to lock up currency is bad. Currency enough is needed, owing to the greatly enhanced prices of all goods and owing to the increase in wages bills. Owing to those causes the issues in Ireland largely increased during the War. The remedy proposed here is a simple one, and I hope the House will give the Bill a Second Reading so that the details of the one clause may be examined in Committee upstairs.
§ Sir D. MACLEAN
Will the right hon. Gentleman explain how the operation of this Bill, when it becomes a statute, is likely to reduce the paper currency. I should have thought that by making these notes payable only at the head offices you would increase the fluidity of their currency.
§ Mr. BALDWIN
I am not quite sure that I follow my right hon. Friend. The form of currency that is legal tender is the currency note. A considerable amount of these has to be held against possible payments in all kinds of small bank branches throughout the country. That is wholly unnecessary for the ordinary purposes of trade. The Bill will relieve them of this form of holding, and will reduce considerably the amount that will be required.
§ Mr. HOGGE
I am not sure that I understand exactly what this Bill means. 1397 First of all, I do not appreciate the period of time at which it is introduced. We are passing through the House of Commons a measure of Home Rule for Ireland. Presumably, this question of the internal banking arrangements of Ireland is one of the questions with which a United Ireland would be the proper body to deal. Is not that so? I should have thought that a Member of the Government, and probably a more responsible Member than his colleague, the Chancellor of the Exchequer—because I value my right hon. Friend's efforts very much higher than his colleague's—I should have thought that he, coming forward to move the Second Reading of this Bill, would have offered some observations upon the necessity for changing the Irish banking system at a moment alien we were passing through the House of Commons another Bill entailing a huge constitutional change. Personally, I do not pretend to be acquainted with the financial arrangements of the banking concerns in Ireland, but I have read Clause 1 and I fail to see why persons in possession of these Bank notes should be deprived of the liberty of having them paid out in full at any branch bank. What is the meaning of the Clause? Personally, I have a great contempt for all banking institutions in this country and in Ireland. I think they are really pawnbroking establishments and not banking establishments at all. There is a very great difference between the period of time when our great banks were willing to trust to the character and business energy of those who were willing to deal with them, and the practice of our banks to-day, which are not willing, unless they are secured very much more than formerly, to lend their money. Does this mean that a man who is in possession of a Bank of Ireland note is not able to obtain payment of it on demand at a branch office?
§ Mr. HOGGE
Why should not an Irishman or Scotsman who is in possession of an Irish note be able, if he so desires, to get payment in full at any branch where he happens to be? Those who take any interest in the affairs of Ireland know that the bulk of the money is banked in Ulster banks. I am not sure that this is not a political move. It is 1398 true that the large banks are in Ulster. The Attorney-General for Ireland shakes his head, and I hope he may be able to persuade us that that is not so. I have been told that the Irish farming classes have their money invested in Ulster banks.
§ Mr. HOGGE
We are going to separate Ulster from the rest of Ireland, and this may have extraordinary effects. [Laughter.] Hon. Members may laugh, but he laughs best who laughs last. They agree that the big banks are in Ulster. You are to have a separate Parliament for Ulster, and you might be giving to one part of Ireland financial power over the other part which would be detrimental to that other part. Speaking with, I admit, partial knowledge, but a desire to try and understand the matter, I venture to think that a Bill of this kind dealing with the internal financial arrangements in Ireland is a bit premature and ought to be postponed until the Government Bill as to Ireland is on the Statute Book. We are assured that by that Bill the Government are going to entrust the people of Ireland with very large powers, and why should they not entrust them with the power to make their own financial arrangements and their own banking arrangements?
§ Mr. RAFFAN
There may be a case for this Bill, and I have no doubt it would not be introduced otherwise, but I do not think the right hon. Gentleman has made out a case for it, and it is necessary to do even more than that, and to make out a case for the urgency of it, and that he has not attempted to do. Here is a system which has been in existence since 1828, and apparently it has worked for nearly a century to the mutual convenience of the Irish banks and people. Certainly in the ten years I have been here, I have never heard any Irish Member from North or South make any complaint as to any inconvenience caused by the present arrangement, nor, so far as I know, has any attempt been made to secure its alteration. We are entitled to ask why is it proposed now on the eve of the passing of a measure of self-government for Ireland, and why is it desired to make this great and drastic change. The whole case for Home Rule is that it is desirable in matters which affect the Irish people that they 1399 should have the right to deal with them themselves, because they have greater knowledge as to those matters which only affect them. If ever there was a measure which comes within that definition it is this. Whether it passes or not, no Englishman, Welshman, or Scotsman will be affected, but it will be bound to affect, for good or ill, the people of Ireland, North or South. I think the right hon. Gentleman ought to tell us why this matter is so extremely urgent, and why it must be lifted out of the purview of an Irish Parliament after the lapse of a century.
It is, of course, regrettable that the House has not the assistance of a larger body of Irish Members to guide them with regard to this matter, as the right hon. Gentleman has stated the view of the Irish banks only, and has not professed to put the point of view of the public. I will not dogmatise about it, but I should imagine that it must be to the convenience of the Irish people that they are able under the present arrangement to go to a branch bank and deal with these notes there, and that it must be an inconvenience to them if this Bill is passed. If that be so, I suggest that the governing consideration ought not to be the mere wish of those who conduct banking institutions to secure a new privilege, but that the public point of view should be specially kept in mind. If I am mistaken with regard to the public point of view, I think it would be useful if the extremely able and representative Members for Ireland who are here were to enlighten us with regard to the point of view of the customers of these banks. Finally, I would appeal to the right hon. Gentleman to make out a case of real urgency which will justify the House in dealing with the matter at this particular time.
§ Mr. BALDWIN
With the leave of the House, I would like briefly to answer the points put by my hon. Friend, and to apologise very much to them if I have been unsuccessful in explaining the purpose of this Bill. In regard to the speech of my hon. Friend who has just sat down (Mr. Raffan), I have always looked upon him as a pillar of hard-shell Radicalism, but the only argument he has used is, that here is an Act which has been in 1400 force for a hundred years; why change it? The passage of this Bill into law will make no difference to any individual at all. There will be no more difficulty in getting currency than there has been in the past, any more than the hon. Member finds a difficulty in getting currency notes given him for a Bank of England five pound note at some place other than in London. I apologise to the hon. Member for East Edinburgh (Mr. Hogge), for smiling at the dreadful vision which he conjured up of all the money in Ireland being locked up in Belfast, and no one being able to get any of it, but it may comfort him to know that of the six banks affected, three have their head offices in Belfast, and three in Dublin, and that a great deal more money will be locked up in Dublin than in Belfast, so that if it comes to refusing to pay their political opponents, those who were for so long allied with the hon. Member in this House, will certainly not come off second best.
I think that that covers all the points but one, and that is the point that was raised by both my hon. Friends: why are we bringing in this Bill now; why not wait until the Home Rule Bill has become an Act? My hon. Friend was good enough to refer to my personal sense of responsibility, and it is exactly that personal sense of responsibility which compels me to bring it in now instead of waiting. If I could I should have liked to have brought it in some time ago, but was unable to do so owing to the congestion of business. My hon. Friend asked what had altered the circumstances and why this Act of a hundred years old should not be allowed to run. The whole currency of the United Kingdom is in a very unsteady condition. It is not a matter of concern to Irishmen alone. It concerns all the inhabitants of the United Kingdom who use this common currency, and it is our duty in every way we can not to have any more currency out than is absolutely necessary. We believe that this Bill will help to some extent—to what extent it is impossible to say exactly—to lessen the need for currency, and on that ground, and on that ground alone, I commend it to this House.