Lords Sitting of 26 April 1910

Preamble
Several Lords Several Lords—Took the Oath.
The LORD CHANCELLOR The LORD CHANCELLOR acquainted the House, That the Clerk of the Parliaments had laid upon the Table the Certificate from the Examiners that the further Standing Orders applicable to the following Bill have been complied with:
Mallow Urban District Gas.
The same was ordered to lie on the Table.

STANDING ORDERS COMMITTEE.
Report from, That the Standing Orders not complied with in respect of the petition for additional Provision in the
Warrington Corporation Bill
ought to be dispensed with, and leave given to the Committee on the Bill to insert the additional Provision:
Read, and agreed to.

LOCAL GOVERNMENT (IRELAND) PROVISIONAL ORDER (No. 2) BILL.
Reported, without Amendment, and recommitted to a Committee of the Whole House To-morrow.
HAVANT GAS BILL. [H.L.]
Reported, with Amendments.
SURBITON URBAN DISTRICT COUNCIL BILL.
Reported, with Amendments.
HANDSWORTH URBAN DISTRICT COUNCIL BILL. [H.L.]
Read 3a, and passed, and sent to the Commons.
PROVIDENT ASSOCIATION OF LONDON BILL. [H.L.]
Read 3a: Amendments made: Bill passed, and sent to the Commons.
LIVERPOOL AND LONDON AND GLOBE INSURANCE COMPANY BILL. [H.L.]
Read 3a, and passed, and sent to the Commons.
CHAIRMAN OF COMMITTEES.
The Lord Steward (E. Beauchamp) appointed to take the Chair in Committees of the Whole House this day in the absence of the Chairman of Committees from illness.

THRIFT AND CREDIT BANKS BILL. [H.L.]
[SECOND READING.]
Order of the Day for the Second Reading read.
THE EARL OF SHAFTESBURY: My Lords, the Bill that I am going to ask your Lordships to read a second time this afternoon is in a sense what might be called a blood relation to a similar Bill that was introduced in your Lordships' House some two years ago by my noble friend Lord Wenlock. That Bill received a Second Reading at your Lordships' hands, but was lost in a whirlpool of difficulties and objections raised by the Government and by others in the Committee stage. I hope that the Bill which is now produced for Second Reading will in a sense have met the objections that were entertained by the Treasury at that time, and will have made provision for some of the difficulties that were then raised by the Chief Registrar.
The principle of the Bill is to establish co-operative credit societies—in other words, village banks—which have been found to be such a boon to the poor agricultural population in foreign countries and in Ireland. They are simply humble village banks, restricted in area and in numbers, and provided with borrowing powers to be used for the benefit of the very humblest. Abroad they were inaugurated to meet the very serious position of affairs brought about by the gombeen men, as we call them in Ireland—by the usurers of the time. In my humble opinion, the success of the small-holding movement in this country or in Ireland must depend to a great extent on the pro-

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vision made for co-operation and combination among the small holders, and I am sorry that the noble Earl the President of the Board of Agriculture, who takes such great interest in this matter, is not in his place this afternoon, because I should have liked him to have heard the principles of this Bill, which I believe will be of enormous benefit to the poorer inhabitants in agricultural districts.
What are the means provided to-day for a man to borrow who is really in need of a small loan? The only thing he can do is to travel to the nearest town and apply to probably a joint stock bank managed by a board possessing no interest in the borrower himself or in the nature of the loan. In olden days there were local private bankers, who probably knew the individual who came to apply for the loan, took an interest in him, and were able to judge as to his means and the security he had to offer; but nowadays if a man is desirous of borrowing a small sum the machinery would be that he would have to travel to the nearest town, and take with him his sureties; he would have to spend the whole day getting there, and the chances are that the loan that he would be able to get would be only a small one repayable within a short space of time. And so it would be a real boon to these people if you could bring to their doors a system which would enable them to borrow cheaply. I will come to the system on which I propose to establish these banks in a moment or two.
I would remind your Lordships that village banks or co-operative credit societies have been in vogue on the Continent for a great number of years—in Italy, in Austria-Hungary, in Belgium, and in Germany. In Germany alone there are 15,000 of these banks. They work under different systems, but the majority of them, I believe, are established under what is called the Raffeissen system. Raffeissen was a German, and he was born nearly a century ago. He had aspirations to win his spurs on the battlefield, but owing to physical infirmities he was prevented from joining the Army and became a Civil servant, much, I think, to the benefit of the agricultural population of Germany. Being a Civil servant, he became a burgomaster, and during the years of famine of 1846 and 1847 he came into touch with a condition of affairs that
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brought at once to his mind the necessity of some sort of reform. He found the down-trodden peasantry suffering iniquitous hardships through being entirely in the hands of the usurer of the day, and he saw at once that some system was necessary to deliver these poor people from the yoke of the usurer and enable them to obtain any small loans that they might require to eke out their existence. And so he established a system of co-operative credit banks. That system was based on one great principle—namely, that people should combine, and by their combination offer such security as would enable them to borrow loan capital cheaply and lend to the poor borrower also cheaply. They were able to lend to the borrower cheaply, but they were able by their security to borrow the loan capital still more cheaply. Then by making every member of the society jointly and severally responsible for all the money that was lent a system was set up by which every man was interested in the doings of his neighbour. He was interested in seeing that the security was good and that the loans Were put into the right hands, and so you got a system by which a man sought for no money fee of his own, but was really interested in the welfare of his neighbour. It was a wonderful system.
The first bank was started with a loan capital of £300. Gradually the movement spread until now there are 15,000 of these Raffeissen banks in Germany. It is interesting to follow up the life history of that first bank started by Raffeissen. It was only ten years ago, I think, that that bank was wound up owing to the decision of its members to abandon the co-operative principle started by the founder. When they wound up the concern, which, as I have said, was started on a loan capital of £300, they found that £2,000 had accumulated from the small over profits made upon the loans. The rules of these societies are embodied in the second clause of this Bill. Your Lordships will see that they are purely philanthropic institutions. They are not meant in any way to be a source of profit to the members. In one of the rules it is expressly provided that no part of the funds shall be divided among the members by way of profit, bonus, dividend, or otherwise, and that the profits of the society in each year shall be carried to the credit of a reserve fund. It is further provided that if the society is

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wound up the reserve fund shall not be divided amongst the members, but shall go to some purpose of public utility in the locality. The reason for that is that you do not want to start a system by which the members of the society would build up a large reserve fund in order that, when the reserve fund was large, they should then have the benefit of dividing it among themselves. These reserve funds are built up to increase the security of the bank, to enable the loan capital to increase, and so facilitate the lending of money to small borrowers.
These Raffeissen banks have been taken up not only on the Continent. They already form part of the credit system in our own Empire. Amongst all the great acts of administration which took place in the time of Lord Curzon's Viceroyalty of India, I believe there is no act that will be more gratefully remembered by the ryots of India than the passing of the Indian Credit Society Banks Act of 1904. There are over 2,000 of these credit banks in India at this moment. These societies are incorporated societies, a point to which I will draw your Lordships' attention in a moment or two. Ipso facto when they are established they become incorporated societies. To come nearer home, we find that in the poor congested districts in the West of Ireland these banks have been of enormous benefit to the poor peasant proprietors. The idea was taken up by Sir Horace Plunkett, and now in Ireland we have some 300 of these societies doing well and bringing relief to the poor population. The gombeen man plays a very important part in the life of the Irish peasant. It was to get the peasant out of the clutches of the gombeen man that these credit societies were inaugurated, and they have done exceedingly well. The total loan capital has advanced from £48,718 to £49,840—an increase of £1,122 in one year; and the number of loans granted is shown as 8,615.
In connection with these credit societies comes the other side of the picture—namely, that of thrift. It is better to have your loan capital derived from deposits by the members of the society than to have it from an overdraft at a local bank. It is hoped that eventually these banks will form a well-secured savings bank for the people, and in that direction they will really be a boon to the State, for I
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must draw your attention to a recent declaration on the part of the Postmaster-General as to the increased expenditure connected with the savings bank system in this country. He says that the cost of administering the Post Office Savings Bank has been much increased of late years by the tendency of depositors to use the institution for the purposes of current accounts instead of for their savings, which was the original object for which the Savings Bank was promoted. The Postmaster-General says:—
"Every transaction, great or small, has necessarily to be reported to London for record in the ledgers at the central office, and this renders business very costly when depositors make frequent deposits and withdrawals, especially when the individual sums are small."
Therefore I submit that I am right in saying that if these credit societies and small banks are formed on the savings bank principle, they will to a certain extent relieve the Post Office of an encumbrance which is costing them more every year.
I now come to the details of the Bill, which is required to grease the wheels of the machine, for in many ways the system is cumbrous at the present moment. First of all, the Bill takes power to incorporate the societies. The incorporation of these societies means that they will stand on their own, and instead of acting through trustees as they have to now under the Friendly Societies Act, they will then be able to sue and be sued on their own account. Secondly, there is power taken to form central institutions. These central banks are institutions in which the affairs and interests of the whole system are focussed. They form the receptacle for the reserve funds of the small local banks, and they are the common cash-box, equalising excess and want and facilitating common business. These central banks are based entirely upon limited liability, as against the unlimited liability of the small credit societies. Then there is one other point to which I wish to draw attention. It is one of the most important parts of the Bill as regards Ireland. This Bill takes power for the trading of these co-operative credit societies. The societies in Ireland are very often seriously hampered for want of this power. I will give your Lordships an illustration. At the beginning of the year 1907 there was a failure in the potato crop

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and the Department of Agriculture found themselves in the position of being obliged to find some reliable way of introducing new potato seed into an infected area. They naturally did not want to pauperise the people of the district by distributing seed broadcast through the unions, so they hit upon a plan of providing funds for the credit societies working in the West of Ireland, who were in their turn to hand the money over to their members to enable them to buy seed in the North of Ireland, where the seed was good, under the inspection of their officers. But then it was found that it was not legal for these co-operative societies to trade, and so a cumbrous and roundabout method had to be devised. Committees were formed to buy seeds from the contractors, and the money was handed over from the credit societies to these committees; they in turn dealt with the contractors, and much time was thereby lost and needless expenditure and an infinite amount of trouble occasioned. If, on the other hand, these co-operative trading societies had the legal power of trading, they could have dealt with the contractors straight away and the whole machinery would have been simplified.
I may be told that under the Industrial and Provident Societies Act there is a power to trade which is not given under the Friendly Societies Act. But you would then require a share capital with a limited liability, and that destroys the whole principle of the Raffeissen system. The principle of that system is unlimited liability, by which every member jointly and severally is responsible for the amount out on loan. Therefore it is obviously necessary that, if it is to work under the Friendly Societies Act, you want legal powers for trading under that Act. This would be of enormous advantage to Ireland; it is the one thing that is wanting in that country. These powers are possessed on the Continent. The societies on the Continent never really began to flourish until the co-operative trading societies came into existence, with the result that the movement has spread in the manner I have described. This is a very complicated and difficult subject, but I hope I have made the principles of the Bill clear to your Lordships, and I trust that it will receive the sympathetic consideration of His Majesty's Government and be read a second time. Perhaps I ought to add that the Bill itself is not
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my handiwork. The author of the Bill is Mr. Wolff, an acknowledged authority on these matters, whose experience is second to none. And in that direction might I say that if your Lordships really want to get an intimate knowledge of the whole matter, you could not do better than read the book which has just been published by Mr. Wolff on "People's Banks"—a most admirable contribution to the whole subject. I thank your Lordships for listening to me so patiently, and I beg to move that the Bill be read a second time.—
Moved, That the Bill be now read 2a.—(The Earl of Shaftesbury.)
LORD MACDONNELL OF SWINFORD: My Lords, I rise to support the Motion of my noble friend Lord Shaftesbury, and as I have had some experience in the creation and promotion of agricultural banks, both in India and in Ireland, perhaps the few remarks I shall make may not be altogether undeserving of your attention. In the year 1898, after the United Provinces of India had begun to recover from the severe famine which had afflicted them during two years, the Government of India were confronted with the problem of how the self-reliance of the people might be stimulated and how they might be brought to confront another famine otherwise than through reliance upon the charity of the State.
Some time before inquiries had been instituted in the Madras Presidency as to the possibility of creating Raffeissen banks in India, and a very careful and exhaustive report was prepared by Sir William Nicholson, who had made the subject his own. But no practical steps were taken upon that report, and it was not until the beginning of 1898 that any action was taken. At that time Mr. Dupernix, one of the clever young officers who had served during the famine, wrote a book which immediately arrested attention in Northern India. I asked Lord Curzon to allow me to place Mr. Dupernix on special service for the purpose of carrying into effect the doctrines which he preached, and Lord Curzon, who was ever ready to receive any suggestions tending to improve the material lot of the Indian ryot, at once agreed. The credit for any result which followed must be entirely attributed to Mr. Dupernix

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and the gentlemen who were associated with him. They commenced to establish banks, a propaganda was set on foot to explain to the Indian ryots and the zemindars concerned what the objects in view were, a large number of provisional banks were created and rules were tentatively drawn up for putting them into operation.
In those early days it was, of course, impossible to obtain from the people themselves the necessary funds to finance such an operation, and consequently the Government, which at the time was in my hands, advanced the small sum of 5,000 rupees, or about £300, to give to these banks a small capital with which to commence their work. Shortly afterwards I left India, but I have watched the growth of the movement. The last figures which I have had access to are those contained in the Indian Statistical Abstract for the year 1908, and they show that the operations which commenced ten years before with a little over £300 capital had increased to £430,000. The operations appealed to the people, both landlords and tenants, and I do not think that any more beneficent work was ever instituted in India than these Raffeissen banks. I must be permitted to re-echo the words of my noble friend Lord Shaftesbury in saying that to Lord Curzon is due the credit for having watched these banks in their infancy, for having nursed them in their adolescence, and, finally, for having appointed a Commission which carefully went over the whole ground and proposed the Bill which afterwards became the Indian Act of 1904.
When I went to Ireland I found that these banks were also in operation there, but they were languishing. They were languishing, I believe, for the reasons which caused the Indian banks in the commencement to languish. The reasons were these, that the Indian banks, as also the Irish banks, were not incorporated, that the clumsy and cumbrous system of trustees was maintained, that the financing of the banks was not entrusted to the banks themselves but placed in the hands of outside capitalists. These defects were removed by Lord Curzon's Act, and these are the defects which it is now proposed to remove by the Bill which my noble friend has introduced to your Lordships. The
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Bill is an extremely simple one, based upon the Friendly Societies Act of 1896. It merely asks your Lordships to approve of three principles—first, of the principle of incorporation; secondly, of the principle of creating a central institution for the purpose of financing the banks; and, thirdly, of the principle of granting to these banks the power of trading.
In regard to the first of these principles, that of incorporation, I do not suppose that anybody would prefer that these banks should continue on their present basis and employ trustees while incorporation could be employed. In the Indian Act registration carries with it de facto the incorporation of the bank, and no evil effects whatever have resulted therefrom. In regard to the creation of a central institution, I consider it is all-important. Where you have a number of banks scattered over a large area you must have some poor and some rich banks. The proposal is to create a central bank in which the agricultural banks can take shares, and into which they can pay their deposits, which would then be used for financing the smaller banks without any recourse to outside financial assistance. The principle is entirely consistent with the theory of co-operative banks; it looks to the members of the bank to find the funds necessary for the bank's operations. The granting of permission to trade is also a necessary corollary of the creation of the banks. If banks are allowed to make advances for agricultural purposes there is no reason why they should not also provide agricultural appliances such as seed and better manure, which are also essential for agricultural purposes. When you get so far it is but a very small step to allow these small credit associations among the poor the same liberty of trading that you allow to the large co-operative societies among the rich. These, my Lords, are the few remarks which I desire to address to the House. I trust that you will look upon the Bill with favour, because it will be productive, especially in Ireland, of great advantages to the agricultural population.
LORD FABER: My Lords, I listened with great interest to the words which fell from the noble Earl who moved the Second Reading, because I have myself given some attention to this Bill, and I very soon discovered that it was a difficult measure

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to understand. So far as I can gather—and I look at it, I must say, rather from the commercial attitude than from any other—under this Bill certain men may bind themselves together under the Friendly Societies Act; they may call themselves a bank; they may lend each other money; they do not trade for profit; they can take deposits from the public. The Bill does not say what they are to allow on those deposits, or whether the deposits will be forthcoming. In my experience, deposits are things of very slow growth, and there are many attendant circumstances surrounding a bank that takes money on deposit which have to be inquired into. I do not gather whether the liability is to be limited or not.
LORD MACDONNELL OF SWINFORD: In the case of small banks it would be unlimited, but the central bank would have limited responsibility.
LORD FABER: That is rather difficult to understand. I have referred to the smaller aspects of the question. I now come to a rather more important one. Clause 4 provides that a thrift and credit bank may, if the rules of the society so permit, borrow money from any county council. Let us look at the other side of the question. Is the county council to have power to lend money to these banks? If so, what rate is it going to charge, what interest is it going to demand? I need hardly remind your Lordships that all of us who are ratepayers are more or less concerned. We are shareholders in the county council, and would like to know whether county councils are to be in a position to lend money to these banks. Speaking from a commercial point of view I have no hesitation in saying that from 1880 till now the lending of money merely on agricultural land has been a dangerous proceeding to the lender unless the margin has been very large. All these matters depend on the price of produce. The price of produce has been low until the last year or two. Land banks, small holdings, and agriculture all depend on the price of produce. Fortunately, in the last few years the price of produce has gone up and is likely to keep up, because, after all, land is only a fixed quantity while population is far from being a fixed quantity.
We cannot, however, compare for one moment the state of things in France and
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Germany with the agricultural position in this country. We have to deal with two great factors. One is climate and the other is protection. As regards France, the climate of that country, of three-fourths of it at any rate, is a great deal better for agriculture than this country. As regards protection—I am not now arguing whether we are right or wrong—for better or for worse we in this country have long since come to the conclusion that the dwellers in the towns are to have the cheapest food that can be given to them. Agriculture and landlords have been allowed to take care of themselves. The effect both on agriculture and on landlords during the last thirty years has been very disastrous. That is the position to-day in this country. We give cheap food to the towns, but we do not look after the country. In France and Germany the exact converse is the case. France and Germany, for better or worse, have considered it right to protect their agricultural industry. They put 10 s. or 12 s. on wheat, and agriculture has done better under those circumstances than it has here. Their system has been the opposite to our own, and therefore these banks are able to succeed in Germany and in France. It is all a question of the price of produce. I should have thought that it would not have passed the wit of man to decide on some policy which would give cheap food to the towns and also a little help to agriculturists by such a system as the bounty system on home produce. But this is not the moment to discuss that matter.
I think it might be possible for the Government to take this matter up and finance this land bank system. I am not sure that they would be able to do it. We have in our minds the attempt of the late Government to start a large purchase scheme for Ireland. I always thought there would be difficulty there, because after all the Government were borrowing money at two and three-quarters per cent and lending it at three and a-quarter per cent., and I could not see, that there was sufficient margin for contingencies. As a matter of fact, contingencies occurred; but, curiously enough, the matter arose in this way—that the Government could no longer borrow the money at two and three-quarters per cent.; they have had to pay more for it, and therefore they are in the awkward position of having to give nearly as much for the money as

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the men to whom they lend it give them, and they have to run all the risks. Therefore, I do not think even the Government, unless they were very careful of the way in which the measure was framed, Would be able to carry out a measure of this sort. Banks in India are not on the same footing at all. Those banks were started to guard the natives from the world-wide rapacity of the Indian moneylender. They were inaugurated for that object and they have done well; but there is not that mischief to contend with here. I am ignorant enough not to have known that there were such things as land banks in Ireland, but they do not seem to have been on any large scale. I understand that the funds amount to £48,000.
THE EARL OF SHAFTESBURY: There are 300 of these societies in Ireland.
LORD FABER: Yes; but they have only £48,000 among them. That is not a large sum, and there may be some excuse for my not having heard of their existence. There is not much room for success. If agriculture is not doing well here, it cannot be made to do well by banding men together in the way proposed; and that is why I say that these banks under this sort of auspices are dangerous. Nothing effective would be able to be done unless the price of produce becomes much higher than it is to-day. I do not propose to vote against the Second Reading of the Bill, but I shall listen with interest to the criticisms that will be made upon it in the course of this discussion and in the Committee stage.
LORD MONTEAGLE OF BRANDON: My Lords, I was relieved to hear the noble Lord conclude his speech by saying that he does not intend to oppose the Second Reading of this Bill, because from the general character of his remarks his criticisms were somewhat searching, and he seemed, I regret to find, to regard these little banks with a good deal of suspicion—approaching them, as he frankly told us, from a commercial point of view. The noble Lord is obviously unaware of the peculiar circumstances under which Raffeissen banks were started in Ireland. With the permission of the House, I should like to say a few words just to give my own experience, because I have one in my own village and I know a great deal about the general movement which gave rise to the formation of these banks in the poorer
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districts in the West of Ireland. Towards the end of his remarks the noble Lord put aside the case of India because he said that in India you had to contend with the rapacity of the moneylender. That was exactly the state of things that we had to face in the West of Ireland, and which suggested to Sir Horace Plunkett and others who were working with him that this system which had performed such wonders in Germany should be tried in Ireland, and tried it has been with great success. As a proof of that, there is the fact that some 300 of these societies have been started, and I can assure the noble Lord that they have done a very great amount of good.
Then the noble Lord seemed to think that these were land banks, that they were for the purpose of lending money on the security of the land. These things are on a much smaller and humbler scale altogether. It is rather to enable a poor man to buy a pig than to enable a farmer to buy a large tract of land. The loans are chiefly of a small character. The noble Lord had some doubts whether the deposits would be forthcoming. Of course, when a bank is started in a very poor neighbourhood deposits are not forthcoming at first. That is the reason why, as Lord MacDonnell pointed out, they have to be financed at the outset. That is, of course, a difficulty, and you want some outside help for that purpose; but once they have established themselves and lent money in these small sums, and those operations have been remunerative, they do begin to attract deposits, and the savings of the district are in that way retained in the district and fructify there, and are of great advantage to the community. The noble Lord questioned whether it was advisable to give power to these banks to borrow from county councils. So far as my Irish experience goes, I do not think that that is of very vital importance.
LORD FABER: I did not say that. I said I did not know whether it was right for the county council to lend to them, not whether it was right for them to borrow.
LORD MONTEAGLE OF BRANDON: The noble Lord made quite clear what his meaning was. I do not know whether county councils in Ireland have power to lend or not, but I do not think it is material one way or the other. The banks so far

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have been able to struggle along, and with the help of the Department of Agriculture, which has given them the small sums necessary as the nest-egg to start the thing, they have had no difficulty in making their first few steps, and once they are established they do attract the savings of the local community. As Lord Shaftesbury pointed out, in the case of one of the earliest banks started in Germany there was no less a sum than £2,000 accumulated in the form of a reserve fund. I do not think the question as to whether the Government should finance these banks is involved in this Bill, and therefore I need not touch upon that. But I should like to say, in conclusion, that, having watched these banks in various parts of the country for some years, and having one, as I say, in my own village in Ireland which is doing most excellent work and which very much requires the particular powers which this Bill seeks to confer and which have been so clearly explained by my noble friends Lord Shaftesbury and Lord Mac Donnell, I do very earnestly beg the House to give a Second Reading to this Bill and not place any difficulties in the way of its passing into law.
THE LORD STEWARD (EARL BEAUCHAMP): My Lords, I regret that my noble friend Lord Denman, who generally represents His Majesty's Government in connection with Bills affecting the Treasury, is too unwell to be in his place this evening. I am the more sorry because he dealt with this subject when it came before your Lordships' House two years ago, and therefore would have been able to deal with it on the present occasion with real knowledge. But, on behalf of His Majesty's Government, I give what I think we gave two years ago, cordial approval to the principle of the Bill coupled with the desire to see certain Amendments introduced in it—not, I think, a very unusual position for a Government Department to take up. There is no doubt, if only from the debate to which your Lordships have listened to-night, that the success of the banks which have been conducted on similar principles in Ireland, in Germany, and in India, really proves that we might expect great advantages from them if they were started in this country too.
There is, of course, a great difficulty connected with the question of unlimited liability. I think it is quite clear that you
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ought to have some kind of limitation introduced. If you do not limit the liability of individuals, then probably you ought to introduce a limitation with regard to area, so that all those who are connected with the society may know the financial position of the members and may be aware if any member is taking an unfair advantage of the money that has been lent to him or is at all likely to involve them in loss. I think that is a form of limitation that might be substituted for limited liability with regard to money. The question of county councils has already been partly dealt with in the Small Holdings and Allotments Act of 1908; and I think, with regard to other provisions in this Bill, that a considerable amount of the powers which are given in the Bill can already be exercised under somewhat similar circumstances. But in any case this Bill does, I am glad to know, incorporate some of the Amendments which were suggested by His Majesty's Government on the last occasion. Unfortunately it does not include them all, and it is obvious, from what fell from Lord Faber, that the matter does require some further consideration. The noble Lord, I think, Was the only one who spoke with first-hand knowledge of banking affairs, and it is quite clear that it is desirable that the Bill should be examined from that point of view.
The suggestion, therefore, which I should like to make to the noble Earl is that this Bill should be read a second time this evening, and should then be referred to a Select Committee which could inquire thoroughly into the subject, and whose Report might form the basis of a Bill to be introduced on another occasion either by His Majesty's Government or by a private individual. I hope the noble Earl will not consider that such a step is in the direction of shelving the matter, because within the last few years the Reports of Select Committees appointed to consider Bills of this kind have very often, if not generally, led to legislation on a subsequent occasion. I venture to hope, therefore, that the noble Earl will see his way to adopt that suggestion.
VISCOUNT ST. ALDWYN: My Lords, as this is a matter to which I have given some attention in the past, I should like to make one or two observations upon this Bill. I do not think, in dealing with this matter, that we can lay much stress on experience in India or in Germany. In

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countries like that there are not the facilities for loans being obtained from banks that there are in England or in Scotland, particularly in Scotland, or even in Ireland, but I do not think that is any reason for objecting to the principle of this Bill. I have no doubt there are cases, and perhaps many cases, in which banks of this kind may be extremely useful to depositors and to those who desire to take loans from them, but that the subject is one of considerable difficulty and complication I think has been admitted both by the noble Earl who introduced the Bill and by the noble Lord opposite who seconded the Motion for the Second Reading.
The suggestion made by the noble Earl, Lord Shaftesbury, that these banks might be in some measure a substitute for the Post Office Savings Bank, is one which I confess does not seem to me to be practicable. He told your Lordships that lately there had been a movement among those who deposit their money in the Post Office Savings Bank in favour of utilising that bank rather by way of current accounts than of deposits for any length of time. If that be so, it would be very dangerous for persons to put their money into banks of the kind proposed in this Bill, which are instituted largely in order to give loans to small farmers which would almost necessarily be given for some considerable time, with the idea that they could withdraw it as quickly as they could from the Post Office Savings Bank. That is one point. Another is the security of loans. I agree very much with the noble Earl who has just sat down. You must have local knowledge on the part of those who manage these banks of the persons to whom they make the loans.
There has been, in England at any rate, a considerable change in the last twenty years in local banking. I can remember the working thirty years ago and more of my county bank, and in those days it was universal almost for country banking in England to be conducted much more by personal knowledge than anything else. There has been of late years an enormous absorption of these small country banks by large London institutions, and the result has been that much of that personal knowledge has disappeared and you have to conduct banking in the country much more on the London system of obtaining security for
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your loans than on personal knowledge of the persons borrowing. Then also there has been what my noble friend Lord Faber has alluded to with great truth—a considerable falling off in the value of produce until quite recently, which has depressed agriculture and done much injury to owners and occupiers. All these things have to be taken into consideration; therefore I would venture to say that the only safeguard of a proposal of this kind is that personal knowledge which can only be secured by lending money to people in the immediate neighbourhood of those who manage the bank.
I am glad the noble Earl who spoke on behalf of His Majesty's Government has made the suggestion that this Bill should be referred to a Select Committee. I think it is the only way in which so complicated a subject can be properly dealt with, and if in that Committee the authors of the Bill are favoured with suggestions from His Majesty's Government for the more safe working of the measure, I hope they will accept them. I look myself with some doubt on granting power to trade. Banking is one thing; trading is quite another; and unless that is limited in some way I can conceive that great difficulties might arise in the future in the management of these institutions. So far as the Second Reading goes, I entirely support the Motion, and I think the House is very much indebted to the noble Earl, Lord Shaftesbury, for the extremely clear and lucid statement in which he explained the provisions of the Bill.
THE EARL OF SHAFTESBURY: My Lords, as far as the suggestion that the Bill should be referred to a Select Committee is concerned, I see no objection whatever to it. I think it would be an admirable course to adopt, and I am quite sure that then the merits of the Bill would be thoroughly discussed and any Amendments that were required could be very easily introduced. On the question of unlimited liability, I quite appreciate the point that has been raised. It is obvious that if you are going to have unlimited liability amongst the members, you should restrict the liability in other ways. It could, I think, be restricted in the amount of the loans and in point of area; but that can be done when the Bill is before the Select Committee.
On Question, Bill read 2a, and referred to a Select Committee.

COUNTY COMMON JURIES BILL. [H.L.]
House in Committee (according to order): Bill reported without amendment; Standing Committee negatived, and Bill to be read 3a To-morrow.

MILITARY MANŒUVRES ACT, 1897.
THE UNDER-SECRETARY OF STATE FOR WAR (LORD LUCAS): My Lords, I beg to move the Motion standing in my name.
Moved, That an humble Address be presented to His Majesty, praying His Majesty to make an Order in Council under the Military Manœuvres Act, 1897, a Draft of which was presented to this House on the 21st February last.—(Lord Lucas.)
VISCOUNT MIDLETON: My Lords, the noble Lord has moved a Motion to which I believe there will be universal assent, but I desire to make one or two remarks upon it. I myself am prepared to give him the heartiest support in this matter, but I wish to point out the great advantage of the procedure which the noble Lord has gone through this evening. This Bill was pressed upon the House of Commons by the last Government, and much pressure was put upon the Government of the day from the Opposition side of the House to introduce this particular provision into the Bill—that military manœuvres should not be carried out except after an Order in Council had been made and that Order in Council had been the subject of a Motion of this character. I do not think it will be beside the question to point out that this particular provision, inserted at the instance of those who now form the Government, is one which your Lordships have asked for on more than one occasion in much more important Bills, in order to check much wider powers given to a Minister than those which the noble Lord is putting into force on this occasion. Not only so; there is an intermediate stage. It is quite possible to put into an Act of Parliament, and it has been done in many Acts of Parliament, the provision that an Order in Council should be made and should take effect if no Motion adverse to it is raised within forty days. That action has been pressed for on many occasions, but has been refused to us by those who now form the Government; and all we have been allowed on several occasions when it was necessary to make some concession was that the Order in Council should lie on the Table without any power to your Lordships'
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House or the other House of Parliament of checking it.
I think it is important, in view of recent legislation, to call attention to the extraordinary divergence between precept and practice on the part of those who are now responsible. Last November your Lordships pressed upon the Government that the enormous powers which were given to the President of the Local Government Board to over-ride the elected representatives of the ratepayers in a number of matters which might run to millions of money should at least have the check upon them of being laid on the Table and made the subject of a possible Motion within forty days in your Lordships' House or the other House of Parliament. But that was refused—I must say I think unreasonably refused—and I would ask the noble Lord to tell us whether there has been any occasion on which obstruction has taken place or any attempt has been made in either House of Parliament unreasonably or vexatiously to use the time of the House in order to discuss a Motion of this character. I myself had to carry a similar Motion on several occasions, and I found that it was received in an admirable spirit. I realise that in the great pressure of Parliamentary business it is necessary that much wider powers should be given to heads of Departments than have been given hitherto, because it is impossible to carry an annual Bill on many points which have hitherto been the subject of annual Bills; but, if you do give this power, I think the provision which the noble Lord is putting into force to-night is the negation, and the necessary negation, of the bureaucratic powers which strike at the whole popular control if they are to be in the hands of Ministers in charge of Departments without this sort of salutary check. I have only ventured to call your Lordships' attention to this because I think that this provision is an illustration of the sounder views which prevailed among noble Lords opposite when they were not responsible for the Government of the country.
THE LORD PRTVY SEAL AND SECRETARY OF STATE FOR THE COLONIES (THE EARL OF CREWE): My Lords, the noble Viscount is entirely within his right in calling attention to this particular provision, but I do not know that he is altogether justified in drawing from this provision the conclusion which he

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appears to draw, that on practically all other occasions in which an administrative discretion is given to a Department that discretion should be subject to possible review on the part of either or both Houses of Parliament. In this particular case leave to hold manœuvres in a particular part of England is a matter of importance, and I think it is one which is very properly subject to Parliamentary control. As various Bills come before us there may be other subjects of which the same may properly be said; but at all events there are subjects of a different class and of altogether minor importance, in which we think, as we have shown once or twice during the past two or three sessions, that it is not necessary to trouble Parliament with their review. Each case, I think, must be taken on its merits. This case we should all agree is one where the mere discretion of the Department is not sufficient. As I say, there may be many other such cases; but we are not prepared, both on the ground of principle and on the ground of general convenience, to accept the proposition that all administrative actions ought to be subject to some control.
On Question, Motion agreed to, and ordered accordingly: The said Address to be presented to His Majesty by the Lords with White Staves.

HOWELL'S CHARITY.
THE LORD BISHOP OF ST. ASAPH: My Lords, in rising to move that an humble Address be presented to His Majesty praying him to withhold his assent to the scheme under the Welsh Intermediate Education Act which relates to the Denbigh Share of Howell's Charity for Girls' Schools in Wales, I must remind the House that a scheme practically identical with the present one was rejected by this House in July, 1897, upon a Resolution moved by the late Archbishop Temple. That rejection was supported by the late Marquess of Salisbury, who, at infinite pains, had gone into the whole history and details of this school and endowment.
This scheme relates to the share of Howell's Charity which belongs to the school named after him at Denbigh. This charity was founded in 1540 by Thomas Howell to provide marriage portions for maidens being orphans, with priority to his own kindred. The Drapers' Company
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were appointed under his will the trustees and administrators of this charity. Claimants for the benefit of this charity were to produce a certificate of their kinship to the founder from the Bishop of Llandaff, or, if the See were vacant, from the Dean and Chapter of the same diocese in which Monmouthshire, the home of the Howell family, is situated. The charity grew greatly in value, and an Act of Parliament was passed in 1852 empowering the Court of Chancery to extend the said charity to the establishment, maintenance, and benefit of schools in Wales for the instruction of girls, and maintaining, clothing, and providing portions for the orphan inmates educated in the schools so established. The Court of Chancery, acting upon the doctrine of cy-près, considered that if the money was more than enough for the original purpose of the founder, the remainder should be spent in educating children, especially orphans. In accordance with this scheme Howell's School was established for North Wales, and Denbigh Was selected as a central position.
The school was opened in 1860. Religious instruction was to be given in accordance with the principles of the Church of England, and so it has continued until the present time; but the acceptance of that religious instruction is entirely voluntary, and the children go either to Church or to Chapel, as their parents or guardians desire. The provision of the scheme on this point runs thus:—
"But the said schools and establishments shall be open to female children of parents of all religious tenets, and no child shall be required to learn the Catechism of the Church of England in case her parents or next friends shall express in writing to the governors their objections, on conscientious grounds, to her doing so, and in all other respects the religious scruples of the parents and guardians shall be respected."
During the twenty years that I have been chairman of the governing body there has not been a single case of any complaint or difficulty touching the religious instruction in the school. It is clear from the founder's will that he was a man of very definite religious convictions. But 370 years is a long time ago, and I do not now, nor did I in 1897, argue for the rejection of this scheme merely on this ground. I can say without hesitation that there has been no sectarian bias or preference shown in the management of this school. In proof of that statement stands the fact that at present half the day scholars are the

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children of Nonconformists. No inquiry is made as to the religious belief of children entering the school, and I am only able to give this denominational figure in reference to the day scholars, because it happens that as residents in the town and neighbourhood the religious persuasion of their parents is known. With regard to the boarders, no inquiry whatever is made on this point, the only personal detail given in the application being the occupation of the father; and looking over the applications of the last five or six years, I find that there were eighteen applications for the admission of children of clergymen, of whom nine were elected, while during the same period there were seven applications for the admission of children of Nonconformist Ministers, of whom six were elected. Among the day scholars in the school was the daughter of a Nonconformist Minister who resides in Denbigh and deservedly occupies a distinguished position in the principality.
The local governors are appointed by the Drapers' Company, and to those who know the splendid work done by this Company in the promotion of higher education, this fact itself is ample security for the impartiality and the competence of the local governors. But while I repudiate the existence of any sectarian bias in the administration of this school, I recognise that religious instruction has always occupied a secure and an adequate position in its curriculum, and this fact is, I know, one of the reasons why entrance into the school is so eagerly sought for by Nonconformists as well as Churchmen. In 1897 I supported the rejection of the scheme largely on educational grounds. I consider that those grounds to-day, more than ever, not only justify but demand the rejection of this scheme. The scheme now laid on your Lordships' Table proposes to make this a Denbigh county school, to be graded as a public elementary school. Here let me point out that Howell's School was established for the whole of North Wales and was not limited to the county of Denbigh, and for this limitation there is no justification either in history or in justice. Not a farthing of its endowment comes from Denbighshire or from anyone remotely connected with Denbighshire. The accident of its position is the only claim which the county of Denbigh can make to this school. This fact is tacitly admitted in the scheme itself by the constitution of the proposed governing body.
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It will be observed that the scheme gives a preference to residents in the counties of Denbigh and Flint. I ask the House to notice particularly this point. If these two counties have a co-equal claim to this school, it is important to remember that while the County Council of Denbighshire are the promoters of this scheme, the County Council of Flintshire are as strongly opposed to it and in favour of its rejection.
The transformation proposed in the scheme means the educational degradation of the school. I desire to make this point quite clear. The Welsh Intermediate Education Act, in the administration of which I have been privileged to take a considerable part, resulted in the unforeseen appropriation of most of our old grammar schools by the county authorities. This appropriation was in the majority of cases an educational disaster. Llandovery and Brecon Schools, happily saved from that appropriation, are to-day not only incomparably the best schools in Wales, but take a high rank among the public schools of England. I recognise that the county schools are doing useful Work, but they suffer from a cast-iron uniformity and educationally provide a purely secondary education. The promoters of this scheme aim at a rigid conformity in type, whereas nonconformity in type is essential to a system which desires to meet the educational needs of the whole community. To reduce Howell's School to a level with, and to make it an exact copy of, the numerous secondary schools in Wales would be not only to destroy its primary purpose, but to eliminate a high school at present separate and almost alone, and one which performs the most useful educational work. A thing may be good though not the same, and better because not the same.
It may be asked how far does the history of Howell's School since the rejection of the scheme thirteen years ago, justify these statements. In 1897 the staff of the school consisted of a headmistress and six governesses. Not one member of that staff held any University qualification or any of those educational certificates now considered essential for such a position. The present staff consists of eleven resident mistresses, the headmistress being a graduate in honours of London University and formerly senior mathematical lecturer at Westfield College. Four of the assistant

719
mistresses are graduates in honours from London, Aberdeen, and Victoria Universities, two have taken honours at Oxford and Cambridge, two are licentiates of the Royal Academy of Music, one holds the art class teachers' certificate, and one comes from the Anstey Physical Training College. These ladies, who are especially competent to appreciate the educational changes proposed in this scheme, have notified their intention of leaving the school if the scheme is passed; the reason for that determination is in no sense denominational, but they feel that the transformation of the school into a county school would make it impossible for them to continue in their positions without a serious sacrifice of professional or educational status. During the last five years sixteen pupils in this school have passed the London Matriculation, four have gained scholarships, fourteen have gone on to University work, and five are now preparing for University scholarships, and to this list might be added a large number of other honours, but enough has been said to show that this school is doing excellent work which no other girls' school in Wales is attempting. If this scheme were passed that work would be rudely interrupted. In 1897 the numbers in the school were eighty; they are now 138, and the urgent need of the school to-day, for which there are abundant funds, is the carrying out of the new buildings approved by the Drapers' Company. The Drapers' Company, competent and unbiassed judges, exercise a close supervision over this school. They visit and inspect the school regularly, and they are among the strenuous opponents of this scheme. If the case for the rejection of this scheme in 1897 was strong, it is infinitely stronger to-day, and I ask the House to repeat the verdict which they then gave—a verdict abundantly justified by the educational results since achieved by this school as a consequence of that rejection.
Moved, That an humble Address be presented to His Majesty praying him to withhold his assent to the scheme under the Welsh Intermediate Education Acts which relates to the Denbigh Share of Howell's Charity for Girls' Schools in Wales.—(The Lord Bishop of St. Asaph.)
LORD SHEFFIELD: My Lords, I think it is unfortunate that the right rev. Prelate should have moved the rejection of this
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scheme and not have indicated, in the event of the scheme being rejected, any suggestions he might have to make for a settlement of this question. I have not the slightest doubt that, not only in Denbighshire but in North Wales generally, substantial benefits would be derived from this scheme, and it would be welcomed. The representative governors are not limited in the scheme to Denbighshire or Flintshire; all the counties in North Wales are to be represented on the new governing body, and the scholarships are to be open to the whole of North Wales. The right rev. Prelate referred to this school as a high school. It is also in a sense a charity school. The right rev. Prelate very properly laid no great stress on the religious views of the founder, because the founder at that time would have been subject by law to execution if he had not believed in the seven sacraments. Therefore when the Court of Chancery attached this school to the Church of England I do not think it can be considered that they were giving any effect to the will of the founder.
I take exception to the suggestion made by the right rev. Prelate that this scheme would result in the degradation of the school from a high school to a secondary school. In the general language of the Charity Commission and the Board of Education I do not know that there is any distinction between a high school and a secondary school. Everything between the elementary school and the University is classed as secondary education. I see by this scheme that the ordinary leaving age is fixed at seventeen; yet any scholar whom the headmistress thinks fit to continue may remain in the school up to the age of nineteen. Therefore it is clear that the course of education which may be given up to the age of nineteen covers all that we include in secondary education. The right rev. Prelate did not tell us the age of the present scholars in the school, and what is the usual leaving age.
THE LORD BISHOP OF ST. ASAPH: A great many of them go on to the Universities when they get scholarships, and five are preparing for scholarships now. The usual leaving age, I think, would be from eighteen to nineteen.
LORD SHEFFIELD: I am sorry that the right rev. Prelate spoke so slightingly

721
of the Welsh county schools, which, notwithstanding sparse population and small numbers, are doing excellent work, and do send to the University a large number of their students who do credit to themselves there. I do not think it can be suggested that if the changes contemplated in the scheme were to come into effect you would lower the class of teaching in this school or get a smaller proportion of the students to go on to the University. The school, no doubt, has been conducted in a liberal and fair way, and very nearly as many daughters of Nonconformist Ministers have secured scholarships as have been obtained by daughters of Ministers of the Church of England. We know that if a school in Wales is really to meet the wants of the neighbourhood it must liberally meet the feelings of the Nonconformist population, who are in a great majority.
The right rev. Prelate did not mention that in the present scheme under which the school is governed there is an obligation upon the whole of the teaching staff to sign a declaration that they are members of the Church of England. In a school where apparently half of the scholars are Nonconformist, and where there is this liberal provision that they can withdraw themselves from the Catechism and are at liberty to go to the place of worship of their family on the Sunday, there cannot be any necessity for requiring that the whole staff should be drawn from the Church of England. I had no notice that this Motion was coming on, and I have therefore not had an opportunity of putting myself in communication with the Denbighshire people, but we in North Wales are quite familiar with Howell's School. The question of its government has been before the public in previous years, and a similar scheme was rejected thirteen years ago. I believe that marriage portions and such things are a little antiquated. The school Would be more useful if the large endowments were made more available, and if you look at this scheme you will see that there is a very liberal provision of scholarships for poor children throughout the whole of North Wales. The school is an important one from its wealth and its handsome buildings, and, considering the nature of the population of North Wales, it would have won more confidence if some disposition had been shown to relax the exclusive method of selecting the staff.
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We are told that the Drapers' Company are opposed to this new scheme. I do not know that they have petitioned against it, but if the right rev. Prelate states from his knowledge that the Drapers' Company are opposed I take it to be so. In a country with a scattered population like that of North Wales it is an advantage that there should be one or two schools like this with largely the character of boarding schools. There has been great pressure from the Board of Education and from the Central Welsh Board to endeavour in the rural schools of North Wales to differentiate the curriculum and to earmark one or two schools as giving a more advanced education. There is no doubt that a great number of the children who go to the county schools in Wales are forced to leave between the ages of sixteen and seventeen, and if we could pick out some schools in which the curriculum should lead up to the University it would be a great gain, and it would be a greater gain still if we could make them boarding schools. Therefore I have no fault to find with this school retaining the character of a boarding school. I am glad to see that the scheme provides bursaries and provision for railway fares where such provision is necessary. Therefore I think the scheme is very well drawn, and I believe it would tend to make the school more available for the population of North Wales.
I can understand a powerful and generous City Company, which have shown a keen interest in education, not liking interference with their prerogatives. Hitherto the Drapers' Company have governed the school, and this scheme brings in a large element of local representation. I cannot help thinking that perhaps some compromise might be effected by which the Drapers might have a stronger representation than is given in this scheme, and also a substantial admixture of local educational people might be secured. The scheme as founded by the Court of Chancery was a scheme for the benefit of North Wales, and I think it would be a good thing if the people of North Wales had substantial representation upon it. In so far as the school is a day school it will necessarily be a Denbighshire school in consequence of the limits of travelling. I suppose it is hopeless to divide the House, but we shall hear what His Majesty's Government have to say. The question ought not to be treated

723
as a controversial one, but as a question of how best to make this substantial endowment beneficial to the people of North Wales. I know what a strong feeling there is in this matter, and I think it would be a pity, when the position of ecclesiastical parties in Wales is rather strained, that a conciliatory action should not be adopted. I therefore hope that if the scheme is rejected we may hear something indicating that we may look for a friendly settlement of this matter.
VISCOUNT HALIFAX: My Lords, the noble Lord who has just sat down has not given an altogether true version of the history of this school. This is a school in which the teaching of the Church of England has always been given. We have heard from the right rev. Prelate that the school has been conducted on absolutely liberal and impartial principles, and that a great number of Nonconformist children have been educated in the school. Not a single complaint has ever been made on the part of Nonconformists as to the education given. Surely the liberality with which the authorities have treated Nonconformist children should not be made a reason for practically destroying the religious teaching with which the school has always been associated. Imagine the case reversed. Suppose this had been an undenominational school and an attempt had been made to convert it into a denominational school. Would not the noble Lord be the firs to complain of such a proceeding? The action proposed is like that of the bird which appears at this season of the year, the cuckoo, which, after receiving kind treatment in another's nest, turns out the rightful owner. That is exactly what it is proposed to do in connection with this school. It would not only be unjust if this scheme were allowed to go through; it would not be to the advantage of higher education in Wales.
I have looked through the debate which took place in 1897, and I would like to remind your Lordships how the late Lord Salisbury characterised the scheme of that day. Lord Salisbury said—
"Under an appearance of educational reform we might really be conducting a scheme of theological piracy."
That is precisely what this scheme is. Under the Act your Lordships have a perfect right to veto the scheme if you think it unjust, and I am quite satisfied that nobody who
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knows anything about the history of this school and the facts of the case will think that this scheme is otherwise than unjust. For is it conceivable that these highly-qualified teachers would have declared their intention to resign their places if they had supposed that the scheme proposed would be to the advantage of education or of North Wales generally?
EARL BEAUCHAMP: My Lords, I am not altogether clear on what grounds your Lordships are really asked to object to the scheme which is now before the House. When the right rev. Prelate who moved the Motion addressed us he laid no emphasis at all on the denominational side of the question. He left it rather severely alone; and it is only in the speech of the noble Viscount who has just sat down that that part of the question has been introduced. As it has been introduced I hope your Lordships will forgive me if I say something in the first place on that point.
There was appointed in the year 1880 a Departmental Committee, of which the late Lord Aberdare was Chairman and Lord Cawdor was a member. That Committee inquired into the condition of intermediate education in Wales and the measures necessary for its improvement. The Committee reported that the Howell's Schools were founded by means of a charity originally bequeathed free from any denominational trusts, and that an educational character was first imprinted on the charity by the scheme of the Court of Chancery. The Court of Chancery directed the establishment of two female orphanages, and at the same time introduced provisions the practical effect of which has been to make the schools Church of England institutions. The Committee went on to say—
"In view of the terms of the original Foundation and the effect of certain provisions of the Endowed Schools Act the Howell School must be made wholly unsectarian, and similar changes appear to be called for in the constitution of the governing body."
That is a very conclusive statement which it seems the Committee had no hesitation whatever in making, and I hope it will have some influence on your Lordships to-night.
Partly as the result of the Report of that Departmental Committee, the Intermediate Education Act of 1889 contained provisions affecting the powers of the Charity Commissioners and of the county

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councils in regard to various endowed educational institutions in Wales. The policy of that Act was to place certain powers in the hands of the county councils; and what your Lordships are really being asked to do this evening is to reverse, in regard to this particular institution, the policy of that Act, and without any exhaustive inquiry to refuse to allow the local authority, which in 1889 was considered worthy and capable, to exercise the power given at that time. We are often told that we ought to trust the men on the spot, and I hope on this occasion your Lordships will realise that these county councils, knowing a great deal about the needs of the localities, are well able to prepare a scheme such as is required by the neighbourhood.
Reference has been made both by the right rev. Prelate and the noble Viscount who has just sat down to a debate which took place on a former occasion. A scheme very similar to that now before your Lordships was then defended by the late Duke of Devonshire, Lord President of the Council, and it is interesting to note that he had the support of one or two noble Lords who, I am afraid, are not often found in the Lobby with His Majesty's Government. I hope that in the Division which will take place to-night we shall have their support. There is this to be said in defence of the proposed scheme, that it is precisely similar to one concerning the Howell's School at Llandaff, to which no objection was taken and which passed through your Lordships' House. As to the provision made in this scheme with relation to the religious side of education, I do not think it possible, granted that a scheme is to be made, for any other provisions to be made under the Welsh Intermediate Education Act. I think it should be obvious to your Lordships, since this endowment is applicable to secondary education in the county of Denbigh, that the county council should certainly have considerable influence on the governing body, and that influence is to be shared under the present scheme by various other county councils.
I would be the last person to suggest, and I am sure nobody connected with the Education Office would wish to suggest, that the present education given at this school is not excellent; but it is not impossible that benefit may ensue from extending the education to a larger class of
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girls than receive it at present. If that is the result, as we believe it to be the object of the scheme, I venture to hope that your Lordships will not oppose its passage on the present occasion. The only objection which came from the right rev. Prelate who moved the rejection of the scheme is that the school would be turned from a high school into a secondary school. In the circumstances the best answer is that the presumption is that the school as it should be and as it is likely to be of advantage to the people in the neighbourhood can be better judged by the county council and the joint intermediate committee which drew up this scheme. And as they were the body to whom under the Welsh Intermediate Education Act the duty of drawing up a scheme was entrusted, I venture to hope your Lordships will not interfere with the scheme they have drawn up and which we believe to be needed by the people in that neighbourhood.
THE LORD ARCHBISHOP OF CANTERBURY: My Lords, I should like to say a few words before we come to a decision. Speaking for myself, I am not ordinarily at all in favour of fussy or restless interference on the part of either House of Parliament with schemes which are drawn up by educational authorities, either central or local, upon whom rests the responsibility for such schemes. It frequently happens that some charity or institution of an educational kind requires to be readjusted to meet existing circumstances, and the responsibility then devolves upon the authority, local or central, to draw up a scheme for doing what they regard as necessary; and in such cases it seems to me that the onus probandi rests entirely upon those Who object to the scheme which the local or central authority, in the exercise of their undoubted responsibility, are called upon to prepare.
But the case is surely entirely different where an institution, scholastic or other, which is going on with perfect success and satisfactorily is suddenly called upon to stand and deliver, to give up the status which it at present possesses and to be reconstituted under a scheme which comes, so to speak, out of the blue sky. In that case the onus probandi rests entirely upon those who desire to make the change. They must show that there is some reason for a new departure of that kind, that something has gone wrong, that somebody

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is aggrieved, that some demand, extremely weighty, is being made of a sort which it would be unfair to resist, and that therefore an institution which is now doing good work must be interfered with and changed. I have listened in vain to-night for the slightest evidence that there is any reason for making a change in this case. I have not heard of a single person taking exception to the present conduct of the school. If I did hear of a single person being aggrieved I should wish to look most carefully at all the facts before I resisted an endeavour to set right a grievance which had thus been pointed out; but I find nothing of that kind alleged.
Those in favour of this scheme do not deny that the school is doing admirable work, and that it is prepared to extend its buildings because the demand is large for that increase. The children of Nonconformist Ministers are welcomed within its walls and are there finding all that they desire, and not a trace has been pointed out to us of any difficulty or objection. One argument used in favour of the scheme by the noble Earl who spoke on behalf of His Majesty's Government was that such a plan would be in accordance with the Act of 1889 for promoting intermediate education in Wales. I hold that Act in my hand. It says it shall be the duty of the education committee of the county to submit schemes and to specify the way in which the educational endowments in the county ought to be used for the purpose of such schemes. Can that properly be made to apply to a boarding school so non-local as this is? The noble Earl, Lord Beauchamp, is a distinguished alumnus of Eton. Eton College lies in Buckinghamshire. If the Welsh Act were made applicable to England, would the noble Earl say that it was desirable that the county of Bucks should prepare a scheme for upsetting existing arrangements and starting a new school? That is an extreme case to take, but it is not totally different in kind from what is here proposed. As a matter of fact, no part of the endowment of this school is derived from Denbighshire itself.
The County Council of Denbighshire desire to make this change, for what reason I do not completely understand; the County Council of Flintshire, the other county interested, is equally strongly opposed to the change. In these circumstances is there
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really ground for upsetting an institution which holds the position held by this school to-day? I think it will be agreed that we have good ground for opposing the scheme unless it can be shown that something is wrong or that religiously, educationally, or socially the change would be a gain. It has been pointed out that this scheme proposes to deal with an endowment existing in Denbighshire correspondingly with the treatment that was given some years ago to a school at Llandaff which drew its endowments from the same source and that that change has worked well. I do not know enough of the details to contradict that last statement, but I should be a little surprised to find—indeed I think I can say that the contrary is the case—that there has been no deterioration in the character of the education given in the school at Llandaff which was correspondingly changed in its character some years ago.
I regard this project as an example of a somewhat pedantic desire for uniformity on the part of a county council, which not unnaturally would like to have mainly under its control institutions which exist within its borders although their funds are derived from elsewhere. I not only think that this is a somewhat unfair demand, but I believe that to give effect to such a desire would be distinctly harmful from an educational point of view. We have been in recent educational discussions pressing the great advantage on educational grounds of having a variety of type of schools under different kinds of regulation and under varied forms of control. I believe that the endeavour to reduce to a level of uniformity all schools of a higher grade character that are in a particular area is not only not necessary but is harmful and detrimental to educational interests. Our foremost living authority, Professor Sadler, is never tired of emphasising the gain that comes to a county or neighbourhood from possessing various types of schools. If in this case there could be shown sufficient ground for asking for a change I should be ready with all my heart to consider how the grievance ought to be met or how the difficulty could be overcome, but to be told, because the secondary schools in Wales are at present doing splendid work which we all admire, that therefore another school not belonging at present to that category is to be brought within it, and that we are to do that in face of the fact

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that the highly-skilled teachers within its walls feel the contrast to be so great that they would not continue to serve on its staff—that is a proposition which seems to call for more reason for making a change than we have heard to-night. I hope your Lordships will decline to give sanction to this scheme, not because of anything mischievous within it but because no necessity whatever has been shown for making the change.
THE EARL OF CREWE: I think I ought to say a few words in reply to what has been said by the most rev. Primate. I do not know whether any of your Lordships have taken the trouble to look back at the debate which took place on this subject in 1897, but those who have done so or who carry remembrance of it in their minds will realise that it assumed a very different character from the debate which has taken place this afternoon. On that occasion the scheme was moved by the then Lord President of the Council, the Duke of Devonshire; it was a scheme similar in character to this, and it was objected to by the Archbishop of Canterbury and by other speakers, including, I think, the noble Viscount opposite, solely on the ground that it was taking away from the Church of England something which belonged to it. No educational argument, so far as I can remember, was employed in that debate, except by the President of the Council, who was then responsible for education. The Prime Minister (the late Lord Salisbury), however, moved by the arguments—the religious arguments—put forward from the Right Rev. Bench, threw over his own Lord President, with the result that the scheme was discarded. That was an unusual operation to take place on the Front Bench, and in some cases I should have imagined might even have led to the resignation of the Minister responsible for the Department. But no such result followed, and the scheme was thrown out.
To-day we have had a different series of arguments. The argument, however, which was so freely employed in 1897 was again pressed home by the noble Viscount, Lord Halifax, and in view of that I think it is important to consider what the history of this charity really is. It is not the case of a pious founder whose wishes are, as we sometimes hear in other cases, to be over-ridden in obedience to new-fangled ideas in regard to education. There is no
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evidence that the founder was pious. I hope he may have been; but what he did on this occasion was to set apart a considerable sum of money. I think the amount in the coinage of the time was rather over 8,000 ducats—a sum of £4,000; and he set that sum apart for the benefit of orphan girls of his family. Unlike the famous character in the "Merchant of Venice" who lamented the simultaneous disappearance of his daughter and his ducats, he devoted the ducats to his daughters and to his future female descendants. Not only was there nothing denominational in his legacy but there was nothing educational, and it was not until well on into the nineteenth century that the charity or bequest assumed an educational form at all.
It is not worth while to discuss the question how it was that at that time the Court of Chancery placed the bequest in the hands of the Church of England. That would involve an historical disquisition; but at any rate I confess I do not quite understand what fell from the right rev. Prelate as to the rule of cy-près, of which we used to hear so much in the debates on the Education Bill, having brought about that particular result, because I cannot see that, so far as the terms of the original bequest are concerned, the Church of England was involved in any way whatever. It is quite true that this school conducted on Church of England lines has been conducted in a liberal and tolerant spirit. We may be quite sure that if the right rev. Prelate has anything to do with its management it certainly would be so. That has not been disputed. But I think, on the point of view of what is called theological piracy, it is relevant to ask what is the particular claim of the Church of England on this large foundation as compared with the claim of any other religious denomination? The fact to which attention was drawn by my noble friend behind me, Lord Sheffield, that not merely the headmistress but all the mistresses of the school have to declare themselves members of the Church of England—a fact which was not commented on by the right rev. Prelate although I think it is worthy of consideration—does undoubtedly stamp a special denominational character upon the school which in our opinion it ought not to bear, and I take it that at any rate some change in those arrangements was contemplated by the Committee of which the noble Earl,

731
Lord Cawdor, was a member, when they stated that in their view this particular school ought to assume an undenominational character.
The religious argument, as I have said, has not been strongly pressed. We have been told that this scheme ought to be rejected on educational grounds. I am in full agreement with one remark which fell from the most rev. Primate. It is not wise, I entirely agree, in the name of county education or in any other name to attempt to stereotype all public secondary schools. Quite the contrary; and I think my noble friend behind me, Lord Sheffield, expressed agreement with the same view. I quite agree that in the case of this particular school, its history being what it is, it would be most desirable that its character—a somewhat different character from that of the ordinary secondary school—should be maintained. But why should it not be maintained under this scheme? We have heard a statement that it will not be. But why should it not be? I should have thought that the proposals in the scheme for joint representation of several different counties would have had a marked effect in ensuring that result. I can understand the dislike of those who have regarded this as a Church school to some extent to seeing that character altered. That is an argument with which I can sympathise, although I do not agree with it. But I do not see what reason there is to fear that the character of the school would be seriously altered if this scheme became law.
The right rev. Prelate told us that the ladies who are mistresses there would desire to terminate their engagements if the scheme became law. I cannot think that that would really be a reasonable action on their part unless the character of the school was in any way altered. If the character of the school were lowered one could quite understand that, with the praiseworthy object of maintaining their own status as mistresses of a school of the highest class, they would then desire to leave it, but until some such untoward result as that followed I do not think it would be a reasonable course for them to sever their connection with the school, I do not know whether one of the main objections taken on educational grounds by the right rev. Prelate is the fact that the school Would be subject to the examinations of the Central Board. I believe
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that those who are responsible for the scheme consider that it would be very desirable that such examinations should be held, but, at the same time, if that fact were considered to stamp the school too strongly as an ordinary secondary school, I can conceive that it might be possible to meet the objectors on that point. But apart from that, and if the main objection at the back of the minds of those who desire to destroy this scheme is that the character of this school as a Church of England school is no longer to be maintained, then I am afraid it will be impossible to meet the objectors on that point.
I should like to appeal to your Lordships to think twice before you throw out this scheme, I was going to say a second time, but apparently it can hardly be called a second time because now we are asked to throw it out on entirely different grounds from those which were advanced on a former occasion. And I cannot help thinking that the second set of arguments which have been produced on this occasion, although I can believe that in some ways they are of a character to appeal to your Lordships even more strongly than those which were advanced thirteen years ago—I cannot think that on that point either the right rev. Prelate can be said to have proved his case. I trust that your Lordships will not follow him into the Lobby.
LORD SHEFFIELD: The section in the Act provides that—
"There shall be once in every year under the direction of the governors, in concert with the Welsh Board, an examination and inspection of the scholars by a competent examiner or examiners."
I would point out that that does not put them under the ordinary examination of the Central Welsh Board.
THE MARQUESS OF LANSDOWNE: My Lords, I desire, with the permission of the House, to say two or three words in justification of the vote which I shall give if the right rev. Prelate goes to a Division. The noble Earl opposite has taken us back to the somewhat memorable episode of 1897, when the scheme then put forward by the Education Department was thrown out by your Lordships' House. That was, perhaps, a somewhat remarkable illustration of the independence of opinion and judgment for which I think this House does not always receive sufficient credit, but which undoubtedly does prevail within it.

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It is, perhaps, remarkable that in all the years that have passed since 1897 nothing more has been heard of the necessity for a change in the management of Howell's School, and the question which I venture to think we have to ask ourselves to-day is whether really any case has been made out for imposing a new scheme upon this school.
I am certainly not going to drag in the pious founder. There is no occasion to do so. I do not think that in this particular instance we need go further back than the year 1852. In that year an Act of Parliament was passed regulating the affairs of Howell's School, and in that Statute the scope of its operations was placed under the control of the Court of Chancery, and it is a modern scheme authorised by the Court of Chancery which is now in force and under which the school is now managed. Let me enumerate, in the briefest and baldest manner, the facts of the case as I gather them from what has been stated to-night and from what I have found in the Papers which I have been allowed to see. In the first place, although the religious teaching in these schools is given in accordance with the principles of the Church of England it is not contested that the whole administration of the scheme is carrfed on on the most liberal lines. That has been conceded by two or three noble Lords who have addressed us. No suggestion has been made to-night that there is any denominational bias in the teaching given at the school. That is one fact which I do not think will be contested.
Then, again, I do not think it will be contested that the school has been most successfully administered and carried on, and that it has done an immense amount of excellent work for education throughout North Wales; and not only that, but that it supplies what is clearly a want in that part of the kingdom. It is, I understand, the only school of this grade in the whole of North Wales. In the next place, the school is adequately staffed, and I am bound to say that it does make an impression upon my mind when I am told that the whole of the teachers have signified their intention of giving up their appointments if this change is brought about in the government of the school. That seems to me conclusive evidence that the change is a real change, and not, as was suggested to us just now, a comparatively unim-
734
portant change dealing only with matters of detail. Again, it is not contested that the record of the school is excellent. A large number of honours have been won by the pupils, and their number has steadily increased from year to year. Then, my Lords—a very important fact—the school pays its own way; it does not ask for a brass farthing of public money; and I am told—I do not know whether correctly—that if this scheme was put into effect £2,000 or £3,000 of public money would be necessary to enable the proposed scheme to be carried out. Finally we are told, and it is not contradicted, that the parents desire the school to be conducted as it is now, and we are also told on equally good authority that of the two counties concerned in the school Flintshire is strongly opposed to an alteration of the present scheme.
If the facts are as I have stated them—and I believe they are—what is the case for a change? Surely, as the most rev. Primate said just now, the onus lies with those who ask us to tear up these arrangements by the roots and substitute other arrangements. I have been told that all this has been done without any public inquiry. Is that the case? I am also told that the remonstrance put in by the Drapers' Company, who have been concerned in the government of the school, has been brushed on one side. I am bound to say that I cannot hear of all these things without a suspicion that this is another case of what I cannot help believing to be injudicious meddling on the part of the Welsh Department of the Board of Education. That Department—I cannot refrain from saying it—is not above suspicion, and those of your Lordships who have taken the pains to read the remarkable judgment lately delivered in the case of the Swansea school which my noble friend (Earl Cawdor) brought before the House last year can have come to no other conclusion but that that Department is one that requires to be watched with the utmost attention. The judgments of the Master of the Rolls and of Lord Justice Farwell came to this, that the Department was open to the imputation either of ignorance of the law or of a perverse interpretation of it. I do not know which horn of the dilemma they prefer. At any rate, after listening to this debate without any particular prejudice in favour of one side or the other, I am bound to say that the right rev. Prelate seemed to me to show con-

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clusively that no sufficient case had been made for a disturbance of the scheme under which this school is at present administered.
On Question, That an humble Address be presented to His Majesty praying him
Resolved in the affirmative: Ordered accordingly: The said Address to be presented to His Majesty by the Lords with White Staves.

BUSINESS OF THE HOUSE.
THE MARQUESS OF LANSDOWNE: My Lords, before the House adjourns I should like to ask the noble Earl opposite whether he has arrived at any conclusion as to the date on which the House should re-assemble after the recess.
THE EARL OF CREWE: My Lords, my own view, and I think the view of His Majesty's Government, was that in view of the fact that our work has not been quite so onerous as that in another place we should re-assemble two days before the House of Commons. That House meets on Thursday, May 26, and I suggest that your Lordships should meet for the consideration
to withhold his assent to the scheme under the Welsh Intermediate Education Acts which relates to the Denbigh Share of Howell's Charity for Girls' Schools in Wales.
Their Lordships divided: Contents, 61; Not-contents, 20.

CONTENTS.

Canterbury, L. Abp.

Churchill, V.

Colchester, L.

Esher, V.

Dawnay, L. (V. Downe.)

Norfolk, D. (E. Marshal.)

Halifax, V.

Dunmore, L. (E. Dunmore.)

Northumberland, D.

Hood, V.

Ellenborough, L.

Wellington, D.

Iveagh, V.

Faber, L.

Knutsford, V.

Fermanagh, L. (E. Erne.)

Ailesbury, M.

Ridley, V.

Gwydyr, L.

Bath, M.

St. Aldwyn, V.

Harlech, L.

Lansdowne, M.

Hastings, L.

Bangor, L. Bp.

Hindlip, L.

Camperdown, E.

St. Asaph, L. Bp.

Hylton, L.

Cawdor, E.

St. David's, L. Bp.

Knaresborough, L.

Chichester, E.

Lawrence, L.

Dartmouth, E. [Teller.]

Alverstone, L. [Teller.]

Llangattock, L.

Devon, E.

Ashbourne, L.

Newton, L.

Halsbury, E.

Ashcombe, L.

Northcote, L.

Hardwicke, E.

Barrymore, L.

Raglan, L.

Lovelace, E.

Blythswood, L.

Ravensworth, L.

Plymouth, E.

Borthwick, L.

Ritchie of Dundee, L.

Stanhope, E.

Brodrick, L. (V. Midleton.)

Sanderson, L.

Stradbroke, E.

Camoys, L.

Stanmore, L.

Waldegrave, E.

Clifford of Chudleigh, L.

Templemore, L.

NOT-CONTENTS.

Loreburn, L. (L. Chancellor.)

Armitstead, L.

Lucas, L.

Crewe, E. (L. Privy Seal.)

Colebrooke, L. [Teller.]

Pentland, L.

Courtney of Penwith, L.

Pirrie, L.

Beauchamp, E. (L. Steward.)

Eversley, L.

Stanley of Alderley, L. (L. Sheffield.)

Carrington, E.

Granard, L. (E. Granard.)

Liverpool, E. [Teller.]

Hamilton of Dalzell, L.

Tweedmouth, L.

Hemphill, L.

Weardale, L.

Althorp, V. (L. Chamberlain.)

Joicey, L.

of Lord Rosebery's Resolutions on Tuesday, May 24. I do not know whether that will suit the convenience of noble Lords opposite, but it would give us a holiday of more than three weeks, and I think perhaps that is as much as we are entitled to.
LORD NEWTON: My Lords, I hope this is not the final determination on the part of the noble Earl. I think the understanding was that the House should not meet before May 26. The Resolutions, standing in Lord Rosebery's name are of an extremely important character, and if they were brought forward in another place the discussion on them would take at least two months if there were no obstacles in the way. I understood that it was proposed that the noble Earl should move his Resolutions on Thursday, May 26, and that, if necessary, Friday should also be appropriated to the purpose. That would be a very inconvenient arrange-

737
ment, and I would venture to suggest that it would much better suit the general convenience if the discussion was postponed to the following week, so that a full week beginning on May 30, would be free for the discussion of Lord Rosebery's Resolutions.
THE EARL OF CREWE: The matter is one for your Lordships. I confess it does not seem to me very businesslike to take a longer holiday than they are taking in another place. My suggestion was not, as the noble Lord opposite thinks, that we should begin the discussion on Thursday, May 26, but that it should be begun on Tuesday, May 24, and occupy as long a time as the House might choose to give to it. As noble Lords opposite have a large majority they are, perhaps, more entitled to give an opinion on that point, but I confess that it does seem to me that upwards of four weeks would be a somewhat long holiday to take at this time of the year.
THE MARQUESS OF LANSDOWNE: My Lords, I think the noble Earl's arguments would, perhaps, be more convincing if there were arrears of business for us to overtake after the recess. All that I am aware of are the Resolutions of Lord Rosebery and the Resolutions which the noble Earl himself will move. They will take a considerable time—they ought to take a considerable time—and I feel with the
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noble Earl that we ought not even to have the appearance of delaying the consideration of these important matters. But I confess that the arrangement I was inclined to lean to was that we should reassemble the same day as the House of Commons, and that, in order to make progress with Lord Rosebery's Resolutions, we should sit on the Friday and so give two full days to those Resolutions in that week.
THE EARL OF CREWE: I am quite prepared to fall in with that if it is the general sense of the House.
LORD NEWTON: May I, with the indulgence of the House, point out that if that arrangement is adopted it will be extremely inconvenient. The discussion will obviously take more than two days, and therefore we should have to adjourn it on the Friday, which is an unusual proceeding, until the following week. Why not begin in the following week and finish it off then?
THE EARL OF CREWE: As there seems to be some difference of opinion, perhaps this might be allowed to stand over until to-morrow. In the meantime we may arrive at some agreement.
House adjourned at five minutes past Seven o'clock, till To-morrow, a quarter past Four o'clock.