HC Deb 22 July 1960 vol 627 cc995-9
Mr. Chapman

I beg to move, in page 23, line 35, to leave out "makes" and to insert: shall have this right so long as the building society is satisfied that the applicant requires access to the register solely in order to communicate with members of the society for the purpose set out in subsection (3) of this section. If the society refuses access, a member may make".

Mr. Deputy-Speaker

It would be convenient to take with this the Amendment in page 23, line 36, after first "Register", insert "and".

Mr. Chapman

I must be a little less brief than was my hon. and learned Friend the Member for Kettering (Mr. Mitchison) in his last remark. I must explain briefly how the Amendment has come about. The House will recall that on Second Reading there was a great clamour, particularly from hon. Members opposite, that members of building societies should not have unimpeded access to registers of members of the societies even though they might require it for quite legitimate purposes. It was felt that there might be abuse. People might easily get to know whether a relative or somebody else had money in a building society. The Government were under great pressure to make these registers less accessible to individual members of the building societies.

We then reached the Committee stage when the Government spokesman completely gave way to this pressure and introduced a Clause so substantially altered that what we are now considering as Clause 27 is very different from that with which we started. It has gone right to the other extreme, as we warned the hon. Gentleman in Committee. It now means that, except when a building society is in the gravest difficulties and has not been paying interest and has not allowed a member to withdraw his shares, members will still not be able to get at the register for quite legitimate purposes.

This really goes too far, as I said in Committee. The Amendment provides that instead of having to go to the Chief Registrar on every occasion other than those emergency occasions the individual should have the right of access to the register as long as a building society, that is the board of directors, is satisfied that he requires such access for a legitimate purpose—the same purpose that is set out in an earlier subsection, which is of communicating with individual members on a subject concerning the affairs of the society. If the board of directors refuses access on the ground that it is frivolous, that it is prying into the register for no good purpose, and is not for any legitimate reason, the Amendment safeguards the individual member by providing that he can go to the Registrar as a court of appeal.

My Amendment, therefore, gets rid of the need to go to the Registrar on every occasion other than the emergency ones and states that there can be legitimate occasions in between where the board of directors should give the individual member access to the register. I am sure that this is a reasonable thing to ask and that, as the Clause is now drafted, it has gone too far to meet the earlier objections on Second Reading.

Sir K. Joseph

The hon. Member for Northfield (Mr. Chapman) has made his Birmingham, Northfield (Mr. Chapman) has made his object very plain, but I have to tell him that his Amendment will not help to achieve that object in substance and in fact may do actual harm. He wants to revert some way to the original position, except that the 'Amendment requires a building society to be satisfied—and "satisfied" is the word he uses—whereas before a member had the right of access for the purpose of communicating with other members. The hon. Member is now requiring the building society to be satisfied, and this gives less unrestrictive right of access than was originally in the Bill. I accept that the hon. Member is trying in this way to seek an acceptable compromise, but from the point of view of the desire for privacy on the part of members of building societies his reversion to the original proposal will still be offensive.

Mr. Chapman


Sir K. Joseph

I do not think that the hon. Member will want to fight all this out again. Members legitimately wish to remain private as far as possible. They wish to retain the privacy of their membership and they would still fear that this right might be used for solicitation for the legitimate objects of the society or perhaps for the sale of coupons. In the form which the Amendment takes, it would be extremely easy for a building society genuinely to find that the member's object was not solely for the purpose which be declared. Nobody can prove a negative. Nobody can be forced to accept that the motive which is said to animate a member is the sole and exclusive motive. It will be only too easy for societies to refuse the right of access, and in some cases to refuse it genuinely.

2.30 p.m.

But I must point out that if there were an unscrupulous building society that wanted to avoid access to the Chief Registrar the effect of application, arising out of the Amendment, to the building society would enable it, if it came within its lilies, to use its right to repay that member straight away and so remove the right of the member to take his grievance to the Chief Registrar. I suggest that the position under the Bill as it now stands, that every member shall have a right of access to the Chief Registrar to ask for access to the register, protects the membership quite as much as, and, in fact, rather better than, the hon. Member's Amendment.

I must finish by saying that there is absolutely nothing in the law to prevent the member applying to the building society first if he wishes to do so and then retaining the right to go to the Chief Registrar. I hope I have been able to show the hon. Gentleman that, while not being able to accept even the main purpose behind his Amendment, I de not think his Amendment would serve his purpose.

Mr. Chapman

If I may speak again by leave of the House, I suppose I must be satisfied. I do not even understand what the hon. Gentleman was saying in the second part of his remarks. Frankly, what I save suggested seems to me to be a legitimate compromise. Also, I do not see the hon. Gentleman's point about proving that the word "solely" is in operation. Surely, if the board of directors is satisfied that that is the member's sole purpose, that is the decision for it to make, and, having made that decision, it can give the member access to the register. The board of directors does not have to be able to prove it; it merely has to be satisfied.

Sir K. Joseph

If I may speak again by leave of the House, I am assuming that most 'building societies will, at the wish of their members, desire to keep the register private as often as possible. Secondly, if they are given a legitimate reason for refusing access, they will probably do so. I am saying that the right of the member to apply to the Chief Registrar is a far more effective right since most buildings society directors would refuse access.

Mr. Chapman

I shall not press this point at this late hour on a Friday, but I think that the Government are being most wooden on this issue and have unduly succumbed to all the pressure for complete privacy. It is most reprehensible. The whole thing has gone much too far and become quite ridiculous. Anybody would think that we were dealing with a private company and not a voluntary organisation. Time and time again we have had to remind the Government that building societies are voluntary organisations of voluntary members and are supposed to be run in a democratic fashion. The hon. Gentleman's words almost indicated that the Government have forgotten that and that they are determined to keep these rules so secret that the building societies, as democratic institutions, are no longer likely to exist. I must protest very strongly at the way the Amendment has been dealt with.

Mr. Mitchison

I rise only to say that I have been reading the speech that I made in Committee. It was so good and so long that I do not propose to repeat it, and I could not improve on it. Further, I agree with my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman) that this business of secrecy really is a rather bogus affair in these circumstances. The Bill as originally drafted would not have interfered in the least with any reasonable feelings on the matter or any reasonable requirements of building societies, and I disagree with what the Government are doing. We divided on this matter in Committee. Perhaps we need not do so again now.

Amendment negatived.