§ Mr. Barber
I beg to move, in page 18, line 10, after "(2)", to insert "or subsection (3)".
May we, as I think it would be for the convenience of the House if we were to do so, take with this Amendment my next two Amendments, Mr. Deputy-Speaker?
§ Mr. Barber
The effect of these Amendments is to modify the provision of Clause 14 prohibiting directors or managers and secretaries of building societies from carrying out valuations by creating an exception in favour of existing directors in the next ten years. When we discussed this at some length in Committee I explained that the Government did not feel able to compromise on the principle that valuations and the assessment of the adequacy of the security were distinct functions to be carried out by different people and that the second and not the first was the proper rôle for the directors of a society. However, I promised to introduce at this stage an Amendment allowing for a transitional period of ten years for those directors, managers and secretaries holding office at the time of the passing of the Bill. These Amendments give effect to that undertaking. I shall not go into details unless that is the desire of the House.
§ Mr. C. Royle
You know, Mr. Deputy-Speaker, that I never miss an opportunity of being gracious in this House even towards a Government of this character, but as one who raised this matter on Second Reading and, again, at some length I am afraid, in Standing Committee I want to express my gratitude and appreciation. Of course, this does not go as far as I should like the Government to have gone, and this is nothing like as good as what I suggested, but one has to compromise in this House, and, therefore, I just want to say to the hon. Gentleman that I personally am deeply obliged. I know from correspondence I have received the satisfaction this gives to directors of small societies.
§ Mr. MacColl
My hon. Friend the Member for Salford, West (Mr. C. Royle) interrupted me just as I was about to be ungracious. I was about to say that I think this ten years is too long. However, as he says, we have got to compromise. We had one or two other suggsetions which were put forward. We think they would have been a better solution of the problem. This is the way the Government have chosen. I would not quarrel with it.
§ Amendment agreed to.992
Further Amendments made: In page 18, line 10, at end insert:
(2) For the purposes of paragraph (b) of subsection (1) of this section a person who is a director or the manager or secretary of a building society shall be disqualified for reporting on any freehold or leasehold estate comprised in security to be taken by the building society in respect of any advance:
Provided that during the period of ten years beginning with the commencement of this Act this subsection shall not apply to a person who has been a director or the manager or secretary of the building society at all times since the commencement of this Act, but after the holding of the first annual general meeting after the end of the year nineteen hundred and sixty, only so long as at that annual general meeting and every following annual general meeting he has been authorised by a special resolution to make reports for the said purposes until the next annual general meeting, and for the purposes of this proviso retirement from office followed by immediate reappointment shall not be regarded as a break in the tenure of office.
In page 18, leave out lines 13 to 17.—[Mr. Barber.]
§ Mr. Chapman
I beg to move, in page 18, line 18, to leave out "has made or" and to insert "makes or has ".
I move this Amendment merely to ask the hon. Gentleman whether it can now be accepted as I outlined it in Committee, or whether he is satisfied that the Clause as at present drafted covers the point I made in Committee.
§ 2.15 p.m.
§ Mr. Barber
As a result of what the hon. Gentleman said in Committee I went into this matter again, and I had consultations with those who advise on drafting matters. We are satisfied that the Bill should be left as it is. I can assure the hon. Gentleman that we have wherever possible acceded to requests which have been made to us in connection with this Bill, but in this case we came to the conclusion that it would be best left as it is.
§ Amendment, by leave, withdrawn.
§ Mr. Barber
I beg to move, in page 18, line 44, to leave out "if" and to insert "(b)"
I think that with this Amendment we can conveniently discuss the next four Amendments in my name.
993 The effect of these Amendments is to make the subsection on penalties, at present subsection (4) of Clause 14, read as follows:If a director of a building society fails to carry out his duty under subsection (1) of this section, or any person prepares a report on any estate with respect to which he is disqualified for reporting by virtue of sub-sec ion (2) or subsection (3) of this section, knowing or having reason to believe that it will be used, or is likely to be used, for the purposes of paragraph (b) of subsection (1) of this section, he shall be liable on summary conviction to a fine not exceeding two hundred pounds or to imprisonment for a term not exceeding six months.It goes on to deal with the position of a building society failing to comply with the subsection under which the society and every officer of the society in default are guilty of an offence under the Bill.
This series of Amendments results from two points which were discussed in Committee. The original draft of the Bill suffers from the serious defect that a person who is disqualified from making a valuation report used for the purposes of subsection (1, b) may make a report for a completely different purpose and then find he has committed an offence, because the society has subsequently used it unknown to him for purposes of the subsection. The hon. and learned Gentleman the Member for Kettering (Mr. Mitchison) quite rightly pointed out in Committee that this really was not satisfactory and that the point should be covered by some such words as quoted, and we have brought forward this series of Amendments which, I hope, will meet the case.
The hon. Gentleman the Member for Birmingham, Northfield (Mr. Chapman) suggested that the penalties would be more appropriately like those in Clause 1. He will see that, while we do not feel it right to go as far as he wanted us to do, we have brought the penalties into line with those for other failures by directors to carry out their duties under Clauses 38, 39 and 40.
§ Mr. Chapman
I wish briefly to say that I am very much obliged and that my point is met quite satisfactorily.
§ Mr. Mitchison
This is a case where the Government threw the baby out of the bath water and put the baby back in the right place. I am grateful to them for having done so.
§ Amendment agreed to.994
§ Further Amendments made: In page 18, line 45, leave out from beginning to "a"
§ In line 47, after "(2)" insert "or subsection (3)".
In line 47, after "section", insert:
knowing or having reason to believe that it will be used, or is likely to be used, for the purposes of paragraph (b) of subsection (1) of this section".
In line 47, leave out from "be" to "and" in line 48 and insert:
liable on summary conviction to a fine not exceeding two hundred pounds or to imprisonment for a term not exceeding six months."—[Mr. Barber.]