LOCAL AUTHORITIES (MUNICIPAL BANKS) ENABLING. (Hansard, 10 February 1926)

§ Mr. SCURR

I beg to move: That leave he given to bring in a Bill to authorise local authorities, if they think fit, to establish municipal banks in their area. I have hopes that this Measure will have the same reception as that given to the previous Bill. Last year, this Bill was rejected, and the opposer on that occasion seemed to be under the impression that I was introducing a Bill for creating municipal building societies. This is nothing of the kind. It is a permissive Bill and will enable every local authority in the country, who so desire, but not otherwise, to institute a municipal bank on the same lines as the municipal bank at Birmingham. Birmingham cannot be accused of being in any sense a Socialist town. Those who are returned 1044 to this House to represent that great city do not, except one, sit on this side. Therefore, the proposal and action of Birmingham should appeal to hon. and right hon. Gentlemen opposite.

The municipal bank at Birmingham came into existence on account of war legislation in 1916 in order to promote methods by which savings might be attracted to the War Loans. So great was the success, that in three years there was something like 30,000 depositors with something like £500,000 to their credit, and the Corporation of Birmingham came to this House and got special powers to establish the bank in 1919. It is to receive deposits and to guarantee the interest on and repayment of such deposits, to advance money to depositors desiring to purchase or acquire dwelling-houses in the City of Birmingham or any interest therein, and to utilise and invest the funds of the bank in accordance with the Act. In 1921, the sum received from depositors and the sum deposited was £1,226,000. In 1925, it was just under £3,500,000. During the five years that it has been in existence a sum of £975,000 has been advanced to depositors for the purchase of houses, and that, I think, ought to commend itself to hon. Members opposite. The number of transactions in the year just gone by is just over 1,000,000.

When we have a success like this, I think other boroughs, who desire to have these powers, ought to have them granted to them, and I propose under this Bill that every county council, borough council, urban district council, and metropolitan borough council shall have power, subject to Regulations and subject to the consent of the Ministry of Health, to establish municipal banks on the model of the Birmingham municipal bank. Those of us who desire, as hon. Members opposite say they desire, to encourage thrift among the working-classes, to encourage small people to put their savings where they will be safe, would rather that those savings were deposited in a municipal bank than that people were left, open, as at present, to become the victims of all kinds of cranks and schemes whereby very often their savings are lost. I think from every point of view this proposal ought to commend itself to every party in the House.