§ 6.21 p.m.
§ Mr. Lewis
In the Second Reading Debate I tried to get from the President of the Board of Trade, and afterwards from the Parliamentary Secretary, some information on the meaning of some words in Sub-section (3). I was not successful then and I thought I would try again to-day. The words are:in particular, to the nature and situation of the property which is proposed to be eligible for insurance.I thought these words meant that when each fresh property came to be considered application would have to be made to the Advisory Committee. I understand that is not so, and that this is intended to be something which the Advisory Committee will consider before they approve a scheme. If that be so, I would be glad if the President of the Board of Trade would tell us why those words are inserted. Is it suggested that in certain areas these schemes will not be allowed to operate at all? Is the Advisory Committee to be permitted or invited to decide which parts of the country are suitable for insurance of this kind and which are not? If anything of that kind is in view I can imagine the committee saying: "The risks are very great in such and such an area, and we do not think a scheme in that area will function 780 properly." Surely the greater the risk the greater the need for insurance, and I am puzzled at the presence of these words.
§ 6.23 p.m.
§ Mr. Stanley
The reason for including these words is not among those which have been put forward by the hon. Gentleman as possible reasons. The reason I put them in is simple. The Weir Committee Report drew some distinction between a company or society which appeals broadcast to all and sundry to take part in its activities, and combinations and groups of people with a mutual interest to try and get some cover, however inadequate, for their possible risks. I inserted these, words in order to call the attention of the Advisory Committee to that fact, and, indeed, to ask them to look with a particularly benevolent eye upon societies of that kind. It does not mean to say that they are bound to exclude all other societies, but I do feel that certain kinds of societies which come to my notice, which insure people living in a particular area and have a common interest there, or people owning particular kinds of goods who have a common interest, are really much more the type of society which it is safe for us to allow to continue than some of the more general types which broadcast to the community as a whole. It will be observed that these words have no limiting effect upon the power of the committee to recommend, but they do draw the committee's attention to this aspect of the case. I inserted them so that the administration at the Board of Trade will look favourably, or, I should say, less strictly, on that kind of mutual enterprise, than on the types to which mutual enterprise is only a disguise.
§ 6.26 p.m.
§ Major Milner
I agree with what the President has said. The Committee will appreciate that it is not compulsory on the President to accept the advice of the Advisory Committee. There may be difficulties in making it compulsory, but I hope the Minister will take the committee's advice. I am sitting on one or two advisory committees, and it is a wasteful and useless task to sit on committees and give advice with the best intentions of that advice is not taken. I hope, therefore, that the right hon. Gentleman will, except in special cases, take the advice of the committee. There is nothing in the Bill 781 to say what the constitution of the Advisory Committee shall be. I hope that the right hon. Gentleman will make appointments from the widest possible field, and that he will not do as the Government did in the case of the Weir Committee. They appointed distinguished gentlemen, in whom I have every confidence as individuals, but who are interested in particular lines of business, especially insurance and banking, and their interests might conflict. I hope that the right hon. Gentleman will constitute the committee as widely as possible and that he will have representatives of small property owners on it.
The great majority, certainly in numbers if not in value, of property is held by small people. In the report of a well known building society I saw that the average advance, taking into account all advances on both business premises and house property, was only £414. That indicates the widely-spread nature of real property in this country. I hope, therefore, that representatives of small property owners, or even of owner-occupiers, will sit on the Advisory Committee. They are more likely to be able to advise the Minister as to what the man in the street might think of an advertisement or a circular. I approve the benevolent view that the Minister proposes to take of societies formed by classes of persons having a common interest. I wonder whether the building societies, for example, who have large assets, might not be disposed to take some initiative in the formation of a society which might come within the purview of this Bill. It would be formed under the highest auspices and be of undoubted integrity. It would, with all their knowledge and experience, be formed with adequate funds and be able to carry out any responsibilities which they undertook.
§ 6.30 p.m.
I am obliged to my hon. and gallant Friend for raising the point as to the constitution of the Advisory Committee. There is one point that I wish to put to the President of the Board of Trade. When permission is granted by the Board of Trade, on the advice of the Advisory Committee, will it be possible for the Board of Trade to devise a formula which shall be included in the notice of approval which will make it clear that the permission to advertise 782 does not carry with it the guarantee of the Board of Trade that the scheme as a whole is actuarially sound? That is a point of considerable substance. I will not pretend to say what the formula should be, because the Board has its own legal advisers, but I am anxious that it should be made clear that any approval given to the terms of a prospectus under the limited purposes of this Measure shall not be regarded as a guarantee of the concern. If I can have an assurance that it is intended to devise a satisfactory formula I shall be satisfied.
§ 6.32 p.m.
§ Mr. Stanley
I have only one word to say on the constitution of the Advisory Committee, a subject which I dealt with on Second Reading. I will consider the suggestion of the hon. and gallant Member for South-East Leeds (Major Milner). I want the committee to be a small one in order to deal with these matters expeditiously, and I do not want it to be too highly technical. This is largely a matter of common sense. Whether a circular has a misleading appearance is a thing which the hon. and gallant Member or I could determine as well as the most profound actuarial experts in the country. The point raised by the right hon. Member for Hillsborough (Mr. Alexander) is one which we have very much in mind. We recognise that if a Government Department has to sanction the operations of some body there is always a danger that the sanction will be used by that body as showing some sort of Government guarantee that its operations are bound to be successful. I will not at the moment give any assurance as to the form of safeguard which we shall draw up, but I can assure the right hon. Gentleman that I very much appreciate the point which he has made, because I recognise that there is a real danger, and we shall certainly make every effort to provide a safeguard against it.
§ Question, "That the Clause stand part of the Bill," put, and agreed to.