§ Mr. Tinker (Leigh)
I beg to move, in page 2, to leave out lines 33 to 41.
In moving this Amendment, I should like, with permission, to refer to the other Amendments standing on the Order Paper in my name. I wish to draw attention to the anomalous position which exists in regard to savings and War Savings. In doing so, I recognise that the pledge given by the former Chancellor of the Exchequer is being carried out. It is to what that pledge covers and what it omits that I wish to refer. One thing I have found in public life is that whatever assembly I have had to deal with, I have been able to satisfy it with common-sense argument, and I hope that I shall be able to carry the Committee with me in this case. No one can defend the present position in regard to war savings and savings generally. The late Chancellor stated that he was prepared to consider the question of war savings and make some allowance for them; but if we had stuck strictly to "new money" my argument would probably not have been so strong as it is to-day.
Anyone who reads this Bill, and compares it with the last, will recognise that we are not dealing altogether with "new money" The concessions given in this Bill have allowed certain moneys, which have been re-invested in the interval, to be excluded from the penalties which attach to other savings. Some people, who have been quick enough to discern the chance, have withdrawn their money from certain investments and re-invested it in war savings, as a result of which they have derived some benefit. Other people, who have asked Members of Parliament what they should do with their money and have been advised not to shift it until Parliament gave directions, have, in comparison, been put at a disadvantage. Following alterations in the new Bill, they have found themselves left behind because they have not re-invested their money and obtained the resulting benefits. I ask 1350 the Committee to sweep away all these anomalies so that those people who have saved money by their thrift and sacrifice shall not be penalised. It is not fair that, because the money is not invested in Government securities, they should have to suffer deductions far in excess of any interest they may be receiving. The deductions amount to is. in every £25, which is a severe penalty on thrift.
Here I must say that I very much regret what the Chancellor said to-day in regard to war savings. I do not think it is very good for the country. The Chancellor's argument is that, by holding out a bait to buy war savings, people have been induced to come forward with their savings. I am sure that that is not a fair reflection of the attitude of the people of this country. In St. Helens we set out to reach£750,000 by war savings, and the people have responded to the call because they are patriots.
§ Sir K. Wood
The hon. Member will forgive me, but in this case trade union representatives approached me and made these representations.
§ Mr. Tinker
It may have been an argument used to these people for the purpose of inducing them to invest their money because they could get some return, but people have come forward without any inducement at all, and the facts that I mention prove it. A bank manager told me that an amazing number of very old notes have been brought in. People have been so stirred by the appeals for war savings that they have brought forward notes which they had hoarded up for a very long time, and in many cases have given them. It does not reflect well on the country's attitude to say we have had to persuade people to invest their money. It is wrong to use that as an argument. The question of war savings ought not to arise. It ought to be savings anywhere, and these people should be given the benefit. This so-called "new money" which may come in afterwards from people who are working now may benefit them, but will anyone try to defend the position in regard to old people? It is impossible for them to save money to reinvest for the future. It must be money that they have already saved. If you limit it to new savings, you are giving to only one class, who may be, for the moment, in the fortunate 1351 position of getting fairly high wages through munition work. But for the old people there is no chance of any further accumulation and they can only lend what they have already saved.
That is why I press on the Committee the unfairness of what we are trying to do at present. It is unfortunate that the two things go together. If they could have been divided up, I cannot imagine the House of Commons attempting to deprive these people of their savings. In the last Measure that we passed we agreed that certain things should be excluded from the ascertainment when the supplementary pension was being paid. One argument was with regard to the first 7s. 6d. of superannuation. Superannuation benefits are acquired only by having your money in some particular thing, and later on in life you get the benefit of it. Others may not have done that. They may have saved their money in the bank or invested it elsewhere. Assume that the 7s. 6d. represents £200 savings. One man gets the benefit of that, while the other man who has saved it somewhere else is to get nothing. These are the anomalies that I want to impress on the Committee. None of us could face an audience of old age pensioners and defend the position. I should like to take the Chancellor of the Exchequer to such a meeting and let him state his case on the point. It is an impossible position. I do not expect to-day to succeed in getting what I want, but the question will be followed up stage by stage. I have noticed that, when arguments are used here, a good case leaves some impression. Our arguments are remembered and the Government say, "We are weak on that point. We must do something about it in the future." In the last Debate on this subject the hon. Member for Gravesend (Sir I. Albery) used a good argument when dealing with this point. He referred to the pledge about war savings, and said:The effect of it is that the only people who can really save at the present time are those, who, if they are not better off, are at any rate no worse off as a result of the war. A great number of people are definitely worse off, and to put out, at a time like this, as a kind of bribe to those who are better off, that if they will come with their savings, to help their fellow countrymen in their time of need they will ultimately get an unfair advantage over others, totally misjudges the character of 1352 the people of this country. Very often. I think, our working men and women are misjudged. They are not always credited with intelligence, and certainly not always credited with patriotism. It is my considered opinion that if that pledge had never been given, there would have been possibly more savings made than has been the case"—[OFFICIAL REPORT, 13th February, 1941; col. 1585, Vol. 368.]I agree with that, and, because I see the anomalies and injustices to the aged people, I am pledged to bring this matter forward in the hope that what I have said will make some impression on the Government. When this matter is reviewed I hope that some regard will be given to the aged people who, although bringing up a family, have been able to put by a few shillings, and that they will not be penalised by having the income of their savings taken into account.
I understand that my right hon. and gallant Friend who preceded me in the Chair agreed that hon. Members should discuss this and certain subsequent Amendments at the same time. I think that the hon. Gentleman has gone so far as to discuss the Clause generally, and I would only express the hope that if a wide discussion takes place on the Amendment it should not be repeated on the Question "That the Clause stand part of the Bill."
§ Mr. Gordon Macdonald (Ince)
I want to support the Amendment. I do not want the Chancellor to be too closely tied by the pledge given by his predecessor or to be satisfied with, the defence that he has carried it out. That would be a good defence, but I want the right hon. Gentleman to see our point of view on this issue. We are dealing with a very small section of pensioners. Not many of them have been fortunate enough to save £375 and they have not always invested any of it in war stock. Most of them have invested in co-operative societies, others in building societies and similar organisations. The Chancellor says that if they leave it there, they will be penalised; that if they withdraw it and invest it in war stock they will not be penalised, but that they must have done it before now. At the time of the dispute as to what the pledge meant, we advised our people to leave their money where it was for the time being and told them that when the pledge was made clear we should know what to advise them to do.
Some of these people would to-day 1353 be prepared to invest some of their money in war savings, but I put it to the Chancellor of the Exchequer that though they have put their money into co-operative societies or building societies it does get into war savings indirectly, because those societies have done their best to assist the financial needs of the nation. I do not want this matter to be dealt with in a niggling spirit. By doing so we should be penalising a fine type of person, the person who on fairly small earnings has made struggle to save for a rainy day. I feel that the Chancellor of the Exchequer is making a big mistake in tying himself up to a pledge which ought never to have been given by his predecessor. I appeal to the Chancellor to view this matter, as I know he will, purely as one of commonsense. Here we have a number of people with savings; some have invested them in war loans and others in certain societies; but I ask him to realise that all that money goes into the war effort directly or indirectly.
§ Mr. Woodburn (Clackmannan and Stirling, Eastern)
I appeal to the Chancellor of the Exchequer to give further consideration to this question of savings other than war savings. I recognise that the pledge was given originally with a view to inducing people to start to save from that point only, but there is no question about the fact that the old people misunderstood. I think the Government have made a handsome gesture in giving permission in respect of money which was transferred up to August, but undoubtedly that creates a great number of anomalies. I should like to direct attention to another pledge which was given when the original Bill was under discussion. At that time I moved an Amendment with regard to the capital savings of old age pensioners and suggested that £25 was too low a limit of exemption because it meant that if a person had £100 he lost 3s. a week, which is altogether too great a penalty and caused a great deal of hardship. I moved an Amendment that the £25 should be raised to £100. Reviewing the position, I feel that it would have been much better to fix the same sum as is fixed in the provident societies, a few hundreds; but that is a matter for consideration. I would remind the Chancellor of the Exchequer, because he is probably not aware of it, that the then Minister of Health rejected 1354 the Amendment, not because he was against it, but on the ground that it would have to apply to the unemployed as well. He said:I think that on the question of thrift and capital savings it is common knowledge that the rules for the treatment of capital in the cases of persons affected by a means test have been under discussion by the National Joint Advisory Council, representatives of the Trades Union Congress General Council and the Government. They are actually discussing whether some general concession should be made on this point at the present time. Any general concession would be applicable in this case as well as others and I hope it may be possible to come to some agreement between the two sides."—[OFFICIAL REPORT, 4th March, 1940; con. 127, vol. 358.]I do not expect the Chancellor to be able to tell us offhand what has happened to the discussions, but that was over a year ago. We might have expected that by this time the discussions would be finished and some degree of agreement reached as to what proportion of capital should be exempted, and that it would be a much greater sum than£25. How a person has saved makes all the difference. If he puts his money into an insurance company and draws a capital sum he can invest it in war savings and, I take it, he is exempted, but if he happens to have saved£200 in a co-operative society it would not be exempted. All kinds of anomalies are bound to arise. I have mentioned this other pledge, which seems to have been forgotten, and I hope the Government will take into account what are not technically war savings, and raise the general limit about£25, not making a reduction of is, for every£25 after the first£25.
§ Mr. Barnes
There are certain views which I should like to submit to the Chancellor of the Exchequer on this subject of war savings. I had intended to raise more or less the same points on the Schedule, but if I make my contribution now, I can probably avoid moving my Amendment to the Schedule later. I want to make it clear that I do not think the Chancellor has in any way misled the Committee about disregarding the£375 I feel perfectly clear about the position; I think the original pledge was one of those political statements by a Minister who desires to placate a certain amount of opposition, and probably remove some anomalies, without being clear as to the further series of anomalies that will be created in the course of time. I consider 1355 that the Chancellor has made a reasonable effort to minimise the difficulties that arose because of the confusion of a few months ago. As to the disturbance of the investment market for small savings, I believe that these adjustments meet that difficulty. In view of the publicity that the matter has received, no one can really claim now to have a grievance in regard to the matter. That affects the date problem, but it does not in any way lessen the inequity of this proposal, as it works out.
The Chancellor should appreciate that large sections of the community are familiar with certain forms of investment, which are convenient because they meet their financial circumstances and behind which lie much tradition, custom and habit. These investments represent considerable financial strength to the Treasury at a time like this. Is it good that the State should enter into competition and should discriminate unfairly among the citizens, according to their forms of investment? Take, for instance, investments in such organisations as cooperative societies and building societies, and other investments of wage-earners of this country which operate upon a more or less fixed rate of interest. They are the same as some Government investments, while, in the general field of commerce and speculative investments, the rates of interest and dividends fluctuate and are, on the average, rather higher than those to which I have referred. You do not usually find the wage-earners investing their money in speculative enterprises.
I ask the Committee to realise that, when the late Chancellor of the Exchequer gave this pledge about "new money," there was a legitimate desire to influence a large number of wage-earners to make their contributions to the financial effort of the State. There was the Keynes Plan, which recognised certain groups of workers whose financial position would considerably improve under war conditions, and this proposal of attracting the savings of a large group of workers, who were likely to be better placed financially by the war, and diverting their savings by direct investment to the State, was not a proposal which anyone could criticise. But if the Committee investigates the lone-term effect of that pledge it will be found 1356 that we gradually approach what will eventually be an unworkable situation in our political system. The State and the Government should not discriminate between the citizens of this country. In the course of time we shall find two citizens each equally thrifty—because this is for the purpose of encouraging thrift, or rather not penalising thrift—and who have made equal provision, one gaining an advantage because his investment is a State investment, and the other being penalised because he has chosen a purely democratic social form of investment. I say it is wrong in principle that the State should enter into a limited field of discrimination in regard to investment. That is my general case. I am not quarrelling with the Chancellor, but I am making an appeal to him that, as soon as it is conveniently possible, these anomalies should receive the attention of the Government.
By this pledge we introduce a further complication into this field of social insurance or assistance. We now have investors who will have income derived from a certain form of investment disregarded. We have had in the past arrangements whereby benefits to which workmen have subscribed in their trade unions and which represent grants over a certain period up to a figure of, I think, 7s. 6d. are disregarded. But there is the wage-earner who is not covered by trade union benefits, and who has not been able, at a particular period, to accumulate savings and divert them into war savings, but who has made provisions which have accumulated up to, say, £200 of share capital. That is the limit which anyone is allowed to accumulate in law, and it represents, probably, a weekly sum of 5s., 6s. or 7s. a week in the form of income through interest. On the basis of the test which is applied to war savings or that which is applied to provisions made to a trade union, that person conforms in every respect to the standard which has been laid down by Parliament. Yet that persons is discriminated against and is being penalised. If the Chancellor demands a period in which the pledge must be honoured, I would urge that the Government should give immediate consideration to trying to round off that group of investments, incomes or advantage derived from thrift provisions. Now we have considered 1357 all these things, but all cases are not equitably dealt with and I sincerely trust that some addition will be made to this Bill by future legislation in order to bring in the persons who, by this scheme, are at present left outside.
§ Mr. Silverman
There has been a concensus of agreement among those who have so far spoken on this matter that the arrangement proposed in the Bill is a complete fulfilment of the pledges given. But I have to say with regret that I cannot share that view. I am satisfied, of course, that the specific pledge about war savings has been met, but—I am not prepared with a battery of quotations to support my view: I am speaking entirely from recollection—I have the clearest possible recollection that the pledge originally went beyond that. In order to remind the Committee of what I thought to be the full pledge, may I recall the circumstances in which it was given? For a long time before the war there had been a nation-wide agitation for an improvement of the position of old age pensioners. A vast number of petitions were presented to the House by hon. Members, not only on this side, and the pressure upon the Government was very great indeed.
Ultimately, after the war had begun, the Government—whether yielding to that pressure or acting out of the goodness of their own hearts—introduced a Supplementary Pensions Bill, and it was in that Bill that for the first time the principle of the household means test was applied. That aroused very bitter opposition indeed. It was felt that it was a retrograde step in the sense that this kind of test had never before been introduced in any kind of pensions legislation. In that atmosphere there arose the question of thrift and it was said very powerfully—and, I should have thought, irresistibly—that the State ought not to differentiate by legislation between people who had been thrifty and people who had not been thrifty to the disadvantage of those who had taken some thought for the morrow. We said it was quite wrong that because a man, in very difficult circumstances and through a long and difficult life by no means well rewarded, had been able to set something aside, it should be used against him when it came to looking after him in his old age. It was in that atmosphere, in the course of a general 1358 discussion on whether people ought to be penalised because they had been thrifty, that this special point about war savings arose.
It was then that some Members of the House pointed out that, apart from the general question of the penalisation of thrift, they had been invited to go about the country and prevail upon people to contribute to national funds, but at the same time they had to tell them that if they did so they would be penalised in their old age. So it was that the specific pledge that war savings were not to be affected was given. But outside that specific pledge I feel certain that statements were made by the Ministers in charge that the whole question of this penalisation of thrift would be reviewed. It must be remembered that the agitation was not about the position of old age pensioners in future, but about how existing old age pensioners might have their position improved. One thing which is perfectly clear, and beyond controversy, is that, except in one very limited respect, existing old age pensioners will not benefit in the least from the concession which has been made. All that can be said for it is that, provided that money is now saved and invested in certain ways, that money will not be used in future as a weapon with which to reduce the old age pensioners' standard of living. There is no benefit to the existing old age pensioner. If any existing old age pensioner were in a position to benefit from the proposal, he would not have been entitled to a supplementary pension at all. The man or woman who is so well off that he can devote some portion of his income to savings, can never make out a case for a supplementary pension. This concession postulates also that in future the household means test will still be with us—if not, why do you need these exemptions? What we are concerned with at this moment is the fortunes of the old people now.
After the speech of my hon. Friend the Member for East Ham, South (Mr. Barnes), no one can suppose that this artificial distinction which we are drawing can last long. The time must come, in seven years, 10 years, or 20 years, when some administration will have to say, "This is absurd; here are two people, living in houses side by side; one has his money invested in one thing, the other in 1359 another thing. In one case it is taken into account, and in the other case it is not" I do not suppose that anyone, on that side or on this side, on the back benches or on a Front Bench, fails to agree that some day that distinction will have to go. Then, let it go now. Seven years or 10 years is a very long period in the life of a person aged 65 or 75. Whatever advantage we are able to obtain through the nation's struggles in these days, whatever kind of new world order, whatever kind of sanity and communal morals we are able to create, these people whom we are now considering will not be alive to benefit from it. I hope that the argument I am putting forward is a reasonable one, and that we shall get an answer to it. I say to the right hon. Gentleman that if you have a principle here, which everybody admits cannot last, it is unfair, merely for reasons of legislative or administrative convenience, not to relieve from the unfair burden which it imposes, those people who will not live to benefit by any reformation of it.
I have allowed the hon. Member a little latitude, but as a matter of fact I think he is now urging things which cannot be dealt with by the Bill, and, therefore, I am not at all sure that I ought not to stop him, if, as I suggest, he is now dealing with something which is obviously outside the scope of the Bill.
§ Mr. Silverman
I am afraid I do not quite follow that the support I am giving to Amendments on the Paper deals with matters that cannot be dealt with by this Bill.
I am not referring to the hon. Member's reference to Amendments on the Paper, but to his suggestions and arguments on matters which are not covered in this Bill, and to what he is urging should be done which would be outside the scope of this Bill.
§ Mr. Silverman
I am sorry if I have not made myself clear. I am sure it is entirely my fault. I was suggesting that the artificial distinction which the Amendment seeks to remove creates an injustice which would be removed if the Amendments were accepted or passed. That is the only point I am making. I have made it to the best of my ability, and I propose to leave it there.
§ Mr. Mainwaring
I would like to invite the Minister to consider the position of another small class of persons who will be affected by the terms of this savings Clause. I refer to the small body of injured workmen in industry who are compelled to commute their weekly sums of compensation. It will be appreciated that, in the first place, this small body of men have no right to initiate commutation of the weekly compensation, but it is forced upon them by the employers. When they receive such a commuted sum of compensation, how are they to be affected? I know how they are affected at present. If they are in receipt of weekly sums, one half of it is ignored, and the same principle is carried forward when they receive a lump sum. One half of it is disregarded, but the other half is balanced on the basis of is. for each£25, and it affects either unemployment assistance or supplementary pensions. What is to happen to these men if they place this commuted sum into war savings? Are they to be free to do this? A strong case can be made out for that to be permissible. I suggest that the only difference between the injured workman who receives the sum of£200 or £300 in a commuted sum of compensation and that of the superannuated man is that the superannuated individual has had deductions made from him for 20 or 30 years past from which he now benefits, and the injured workman is regarded as having had a proportion of his weekly capacity deducted which is bound to be exempted at the beginning and not at the end of the period. It has always appeared radically unfair that the administration should be able to utilise a sum of money which represents 30 or 40 years of limited capacity which he loses and use it at this present juncture.
There is another point. The State has very properly disregarded the injured sailor, soldier or airman. That is not the same principle as for the industrial worker who has also suffered disability, and I would like to ask the Minister to give consideration to this point once again and see whether he cannot extend to the disabled industrial worker the same measure of consideration as is extended to others, and also that if they invest their commuted sum in war savings, that should be disregarded in the same way that other sums are disregarded.
§ Mr. Collindridge (Barnsley)
I will not detain the Committee for long in making my small contribution to this Debate. I join with others in paying tribute to the Government for what they have done for the Bill generally. I think we have made considerable progress on past legislation but perhaps we on these benches cannot expect 100 per cent. of our type of social legislation from the type of Government we have to-day. If there is to be any perpetuation of anomalies, we hope to try to remove them. In my own district we are prone to be members of Co-operative societies, and we find advantages because of that. In our early days of home building we found that dividend accrued through the periodical purchase of articles, but in the passage of time we find that dividend left in accumulation of share capital has an adverse effect on the eventide of our lives. We have this situation: £100 of share capital brings 3½ per cent., and 70s. a year to a person with share capital shows to the advantage of is. 2d. per week income in the home. But when a supplementary pension is applied for, there is a deduction by the Assistance Board of 3s. a week for what is actually is. 2d. per week interest accruing on that£100 of share capital. That anomaly ought not to be perpetuated.
Contrast it with this position: If you have a man and wife as members of a society with two books of£200 each, and they have this amount accruing of four times is. 2d. a week in income, or 4s. 8d. a week, they are deprived of receiving a supplementary pension of 12s. a week. In my own district many of our working-class people are doing what they have been advised to do, namely, becoming individual owners of their own houses, but by reason of war conditions there is no house building as heretofore, and I think it is wrong that the capital they have should deprive them of their supplementary pension. It was a grand gesture to say that he who owns his own house should not have that capital of house cost taken into account when seeking supplementary pension, and we suggest that at least we should cut adrift anomalies of that description at this juncture by saying that a modest amount of capital, of the kind in cash that has been quoted to-day, also ought to be exempt from consideration in this matter.
§ Mr. Woods (Finsbury)
I appeal to the Chancellor to approach this matter not so much from the point of view of the pledge that was given by his predecessor, but rather from his own human point of view in the assessment of values. The pledge was given largely to induce new savings, but I ask the Chancellor what chance the average old age pensioner had of making savings up to£375? Obviously he had very little chance. I ask the right hon. Gentleman to look at the problem from the point of view of persons who will be either blessed or afflicted by this Bill.
There are one or two points I want to stress. In the first place, if the present attitude is persisted in, I think it will reflect upon hon. Members. Many of us are associated with the Co-operative movement, friendly societies, and so on. People consulted us on this matter. Some of us advised those who consulted us to take their money out of the Co-operative society and buy Savings Certificates, and others said, "I do not think there is any need for you to do that, because the society is already investing the whole of its surplus in war funds, and to make such a transfer as you suggest would only create unnecessary clerical work." Now, as I understand the position, those who advised people to make a change are, as it were, in clover, whereas those who were more conscientious and did not want to create unnecessary clerical work, are looked upon as being a very poor sort of political tipsters.
Moreover, if the present attitude is persisted in, it will, I think, create another grievance on the sex basis. I have in mind a case where the husband was not an ideal husband in many ways. He had a good time, and gave his wife an amount barely sufficient for her to bring up the family. The man is now an old age pensioner, and owing to his having been in an industry in which it was necessary for him to be in a trade union, he receives from the union a small payment which is practically a superannuation payment. His wife was thrifty and made sacrifices, but the only means she had of saving was by her being a member of the Co-operative society and not drawing her dividend, but allowing it to accumulate, very largely because she wanted to give the old man a decent funeral. She now 1363 has a sum approaching£200 in the Cooperative society. Now, the husband, who was never thrifty but who was very thirsty most of his life, will get the benefit of this Bill, whereas his wife, who did all the saving, who brought up the family, and has been a credit to the country, is to be penalised by the Bill. I ask the Chancellor to consider that human aspect of the matter. It is a human aspect which appeals to the average man and woman. I hope that at an early date the Chancellor will take an opportunity of rectifying this anomaly.
§ The Financial Secretary to the Treasury (Captain Crookshank)
I have been very shocked to hear two or three hon. Members treat the pledge given by Lord Simon in such a cavalier way. Some hon. Members have suggested that my right hon. Friend ought to have ignored that pledge altogether; one hon. Member said that it was a mean and petty pledge, and another hon. Member said that it was a very bad thing. It is true that Parliament can repudiate what any Minister says, but do hon. Members really mean that they want the Chancellor of the Exchequer, on behalf of a Government which, at the time Lord Simon gave that pledge, had the support of the House by a very large majority—and which now has the support of the House by an even larger majority—to say that words uttered by such a Minister can be entirely ignored by his successor when they were given as a pledge to the workers of the country? That would be a curious line to follow. This Clause does not deal with the general question of whether or not there should be an improvement in the position of old age pensioners. Some hon. Members have indicated various ways in which, in their view, the old age pensioners' position should be improved by making different conditions concerning what are called the disregards.
That has nothing to do with this Clause. This Clause merely deals with implementing the pledge that Lord Simon gave. The idea of making this concession was the result of very considerable conversations that had taken place. It may be that the person most responsible for it is the right hon. Gentleman who has been sitting next to me rather than Lord Simon, because it was a declaration by the Trades Union Congress at a time when there was 1364 a fear on the part of organised labour that the reactions which the then means test might have on savings that prompted them to ask the then Government whether they could not make some concession by which that difficulty could be got over, in order that the workers could take their full share, as they wished to do, and as they are doing in a magnificent way. It was after much discussion and consideration that Lord Simon gave the pledge on behalf of the Government that there would be this disregard. It is no secret to say that in suggesting the total of £375, he went to a higher figure than had been mentioned in conversations before.
All that the Clause does is to bring in the machinery by which that can be implemented. All the difference between this and the Bill that we discussed in August is that, instead of dating back to the beginning of the war, the Clause as it now is dates back to the Second Reading of the Bill. The reason for that is that there apparently had been some misunderstanding as to what was meant by "new money" There again the hon. Member for Leigh (Mr. Tinker), who is always such an agreeable controversialist, struck me nearly dumb, which he will be the first to recognise is no mean achievement. He said the Clause now is very anomalous because some people had been quick enough to discern before 14th August that something of that sort might happen and had taken the chance of improving their situation by switching from investments that they had into these specific investments so as to get the advantage of this Clause. That is exactly contrary to what he said in the Debate in August. That is why I was so taken aback. He and the hon. Member for Hemsworth (Mr. G. Griffiths) pointed out the awkward situation in which they were put because people had asked them whether, if they transferred their money from something else into war savings, they would or would not get the benefit of this, and they said, "You will get the benefit," whereas under the then Bill they would not. The hon. Member said:I said to the man, There is a Bill before the House of Commons which, if I am correct, will put that money right in your case. Evidently I did not read correctly"—[OFFICIAL REPORT, 14th August, 1940; col. 841, Vol. 364.]He did not. It is just because of cases like this, because Members doing propa- 1365 ganda for war savings fell into an error that we made an alteration in this Bill. Having done that, it is illogical for him to say it is anomalous for us to do it and that it gives an advantage to people who were quick enough to make the change before August.
§ Mr. Silverman
Does the right hon. and gallant Gentleman think it reasonable or lair or equitable that our constituents who lead the Bill correctly should be penalised while others are not?
§ Captain Crookshank
I should personally have preferred to stick where we were in August. I have not looked to see what the hon. Member himself said and whether he is consistent or not, but, in view of the obvious cases of misunderstanding, the Government thought it better to make that alteration. If we are to say that that is bad luck on someone who did not do something else at some other time, we shall never get any finality at all. I can say, on behalf of the Government, that we are grateful for the way in which hon. Members have met us in the alterations that have been made.
I should like to say one thing about the Co-operative question. The hon. Member for East Ham, South (Mr. Barnes) asked, in effect, in his Amendment, that among the classes of investments which should be considered for war savings should come investments in Cooperative societies. He also mentioned building societies. We could not accept any Amendment on those lines, for two reasons. For one thing, it is going very far wide of the pledge given by Lord Simon to the Trades Union Congress and everyone else concerned. Once we start extending the scope of a pledge, we are in a different field altogether. We are either carrying out the pledge or not. Extending it widely is another story. Apart from that, while, of course, it is true that Co-operative and building societies are great sources of thrift for the workers, it is also true that all the money that is put into those forms of thrift does not automatically pass to help us in the war effort. The object of the pledge was to try and get the maximum amount of new money that we could during war-time for the purposes of the war. With regard to savings in Co-operative societies, I know that they invest—and we are grateful to them—large sums in Government issues, 1366 but they do not invest every penny that they get. They require some for their trading purposes. The same applies to building societies. The hon. Member said that they were of considerable financial assistance to us. We are grateful to them and acknowledge it, but we cannot go so far as he would suggest in his Amendment. Having said that, there is nothing more that I require to say at this stage.
§ Mr. James Griffiths (Llanelly)
May I press the point raised by my hon. Friend the Member for East Rhondda (Mr. Mainwaring)?
§ Captain Crookshank
It has nothing to do with this Clause, any more than the point which was made by the hon. Member for Nelson and Colne (Mr. Silverman). This is merely a question of how we are to deal with war savings within the terms of the pledge. The question whether there should or should not be greater disregards for old age pensioners—
§ Mr. Griffiths
I was not referring to that aspect, but to another, in view of the campaign that is going on all over the country in which some of us are taking part. Suppose that next week a man's compensation is commuted for£300. If he invests that in war savings, is it new money within the meaning of this Bill?
§ Captain Crookshank
Of course it is. If a man gets £300 in cash from somewhere or other and puts it in one of the specified securities, it is new money. There is no question about it.
§ Mr. Mainwaring
Will the Ministry of Labour or the Ministry of Health disregard it for unemployment assistance or benefit and not only for supplementary pensions?
§ Captain Crookshank
That is another question. I will not go into it at the moment, because I would like to give a correct answer. If, however, a person receives a lump sum from somewhere, whether it is compensation or anything else—it may be a lucky bet on the Lincoln—and puts it into a Government investment during the war, it is new money and will be covered by the terms of the Clause.
§ Mr. Pethick-Lawrence
I think we all agree that this Clause implements the pledge given by Lord Simon and that the matter that is left is less important than 1367 it was at the time, because we are abolishing the household means test. What some of my hon. Friends may not have realised is that before we abolished the household means test, it was a question of the means not only of the applicant, but of any other member of the household. They would all be brought into the account, and the old age pensioner would have suffered because, say, a son had savings of his own. Although we are agreed that the Chancellor has implemented the promise of his predecessor, I hope that this not the end of the matter. I should be out of order if I were to go in detail into the wider considerations, but there is a number of ways in which relief can be given in this matter. As it stands, it will represent an anomaly. It will be an anomaly between two people, one of whom has his savings in one form and one of whom has them in another. It will be an anomaly between the man whose war savings were made in one war and the man whose savings were made in another war—I have already had a case from a constituent along those lines. It will be an anomaly between the man who went out to the war and fought and the man who stayed at home and made money in munitions work.
I am sure that the position cannot last very long, and although it cannot be changed in this Bill, I hope that at an early date the Chancellor of the Exchequer will do what he can to remedy the anomalies which are certain to arise, and in the meanwhile to reduce the hardship to people who have their money invested in other ways. As an old Financial Secretary to the Treasury I know that the task of the Treasury is in many ways a hard one, and that their attitude is not always understood by the people of the country, but I hope that the Chancellor of the Exchequer will consider the position and bear in mind the other points which have been raised, so that this anomaly which we are creating to-day in furtherance of this pledge will be modified and finally removed before very long.
§ Amendment negatived.
I beg to move, in page 2, line 45, at the end, to insert:and in the case of war savings certificates the growing produce thereof.1368 Although I am moving this Amendment, I hope that it may be found to be one which is unnecessary. It raises the position of the holder of War Savings Certificates. The accumulation on War Savings Certificates is not paid out annually, but the holder of certificates to the maximum amount of £375 will in course of time become the possessor of £500. What is to be his position? When the certificates fall in it is frequently the case that they are changed into other certificates. I think it is right that those who help the State by leaving their money there should have the benefit of it. I move the Amendment in order that the point may, if necessary, be considered.
§ Captain Crookshank
This Amendment is really unnecessary, because the Clause as it stands says that where investments are to be disregarded under the Bill, the income receivable therefrom is also to be disregarded. The result is that we do not get the somewhat arbitrary calculation which has been discussed this afternoon. In the case of War Savings Certificates, they produce no income at all. The growing interest, if you call it interest, never comes to the holder at all, but is a form of capital accretion, and therefore it does not fall to be considered or treated as income. The actual value of the certificate is described in the last words of the Bill:references to the amount at any date of any Government stock or National or Ulster Savings Certificates shall be treated as references, in the case of any such stock, to the amount originally subscribed there for, and, in the case of any such certificates, to the amount for which those certificates could be en cashed on that date
§ Amendment, by leave, withdrawn.
§ Clause ordered to stand part of the Bill.
§ Clauses 4, 5 and 6 ordered to stand part of the Bill.