HC Deb 11 May 1936 vol 312 cc78-81

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. MABANE

Why is this Clause necessary, in view of Section 6 (c) of the Moneylenders Act, 1900? I have no doubt there is some good reason, but I should like a short explanation as to why the Clause is put in the Bill.

5.47 p.m.

Mr. W. S. MORRISON

This is a very simple matter. Under the Moneylenders Acts of 1900 and 1927 the business of a moneylender was placed under certain statutory restrictions. There are restrictions on a great number of matters. For example, a moneylender may not advertise, except in a, certain way, his willingness to lend money, and the form of his contracts with a borrower is strictly prescribed, and prescribed having regard to what the House normally understands as moneylenders' contracts. He is prohibited also from making any charge for the costs incidental or relating to the negotiations which lead up to the making of a, loan. There are in these Acts certain statutory exemptions, but the proposed company, being a new arrival on the field, does not fall strictly within any of the exemptions in the Acts.

Mr. MABANE

Not those under Section 6 (c)?

Mr. MORRISON

No, and if what my hon. Friend has in view is a statutory company empowered by Parliament to lend money—

Mr. MABANE

"Any body corporate, incorporated or empowered by a special Act of Parliament to lend money." That seems completely to cover this company.

Mr. MORRISON

It is a technical point, but this Bill does not empower the company to lend money; it empowers the Treasury to make an agreement with the company. The company is empowered to lend, not by Parliament, but by its memorandum and articles of association. We therefore consider it possible that this point may give rise to misapprehension, and therefore that we might have in future someone pleading unjustly the provisions of the Money-lenders Acts against this company, to which obviously they were never intended to apply. It is for that reason that we thought it best to place the matter beyond all doubt.

5.50 p.m.

Mr. GARRO-JONES

There is still one point on which I think the Committee would like to have some information, and that is with regard to the rather strangely worded phrase in this Clause which reads: If the company is so incorporated as aforesaid in accordance with arrangements approved by the Treasury. What arrangements have the Treasury in mind? They have first, to ensure that the objects of the Bill will be fulfilled. We have had the hon. Member for Farnham (Sir A. M. Samuel) expressing the horror which we expect from a banker at the prospect of lending money on long terms. He said, "Will you get people asking you for advances to put up a factory and machinery?" Of course, you will get people coming to ask for these facilities. If they were facilities which they could get through the ordinary financial machinery, they would not come to this company. I therefore want to ask whether the Treasury will make certain that the board of this company will not be constituted of what are known as bankers of the old school, because, if so, that will hamper the operations of the company and the objectives of the Bill. My second point is the one which will presumably be dealt with in the memorandum and articles of association. I should have preferred that we have seen the memorandum and articles of association ourselves, but if that is not to be the case, will the Treasury see them, and, if so, will the Financial Secretary be so good as to tell me whether they propose to approve a Clause entitling the company to borrow? The Chancellor of the Exchequer was busily engaged when I made this point previously, but I should be glad to have it cleared up, because upon that point depends how much money the company can lend.

Mr. BENSON

Will the Financial Secretary or the Chancellor explain the reference to 10 years? I do not think the Committee is clear to what the limit of 10 years applies.

Mr. CHAMBERLAIN

Is this on Clause 2?

Mr. MABANE

I beg leave to withdraw my opposition to the Clause.

Mr. GARRO-JONES

On a point of Order. I inquired about certain specific points, and the hon. Member for Huddersfield (Mr. Mabane) has asked leave to withdraw his objection to the Clause but I object to that until I have had an answer. I shall be glad, Captain Bourne, if you will allow the Minister to give me an answer to the extremely important points which I put. They have been put before, but I have not yet had an answer.

The DEPUTY-CHAIRMAN (Captain Bourne)

It is doubtful if those points arise on this Clause at all.

Mr. GARRO-JONES

Perhaps you would allow me to convince you that they do, Captain Bourne. I said that in this Clause appear the words: If the company is so incorporated as aforesaid in accordance with arrangements approved by the Treasury. … I wish to ascertain what arrangements are going to be approved by the Treasury. Does it mean that the Treasury must see the memorandum and articles of association?

The DEPUTY-CHAIRMAN

The hon. Member has overlooked the fact that these words also occur at the beginning of Clause 1. On the question that that Clause should stand part of the Bill, he might have been in order in raising his points. He might again be in order in raising them on the Schedule, but obviously he cannot do so on this Clause.

Clause 3 (Short title) ordered to stand part of the Bill.