§ 3.23 p.m.
§ LORD SALTOUN had given Notice of his intention to ask His Majesty's Government whether they will in future make arrangements to enable payments of postwar credits to be paid to the executors or personal representatives of deceased persons who although entitled to the payments have not cashed them during their lifetime. The noble Lord said: My Lords, this Question which I am asking His Majesty's Government is one of great importance. The case that has come to my notice is that of an old man in my neighbourhood who was in possession of post-war credits amounting to a considerable sum. He was lodging with a landlady to whom he said that he was keeping his post-war credits to give him a good funeral and to pay his debt to her for the money she was spending upon him. In due course the old man died. It was not possible to cash the post-war credits, and he was buried at the expense of the public. I am not sure whether his landlady was paid. When these post-war credits are generally released, the public authority who buried him may be able to recoup themselves in respect of the amount which they are out of pocket; but the rest of his post-war credits will go into the pocket of His Majesty's Government. I feel that that is very hard. This old man could not foresee when he would die, and when he did these assets 305 were frozen—and the only place where he may get some credit for them is in the next world.
§ I hope that His Majesty's Government are going to give me a favourable reply on this point. If they do not, I feel that the matter should be made as widely known as possible, in order that all these old people who have post-war credits may be able to cash them. If the Government do not give me a favourable reply, then I am quite prepared to tell these old people how they can keep their post-war credits safe for any desired purpose. I feel it would be much better if, by a favourable answer to this Question, His Majesty's Government could set these old people's minds at rest, in the realisation that when they are entitled to draw their post-war credits there need be no hurry to draw them, since they will be quite safe in the custody of the Government.
§ 3.26 p.m.
§ LORD LLEWELLIN
My Lords, I want to add only a few words to what has been said. By the Finance Act of 1941 express provision was made for personal representatives to have power to deal with post-war credits. They were not generally assignable, but they were assignable to the person entitled to them under the deceased person's will, or under the ordinary laws of devolution in inheritance. By Section 26 of the Finance Act, 1946, provision was made to repay post-war credits—which we all hoped would have been generally repaid earlier than that—to any woman over sixty and any man over sixty-five who applied. But so far there is no provision on the Statute Book—I will be quite frank; I do not think the Government can do it unless the provision is on the Statute Book—that if an elderly person (a woman over sixty or a man over sixty-five) has not cashed his post-war credits during his life-time they can be paid to his personal representative. If they devolve on a personal representative or heir who is a woman over sixty or a man over sixty-five, then I gather than that person can cash them. But if they devolve on somebody under those ages, then they cannot be cashed. I feel that that position leads to a certain amount of absurdity.
I am well aware that if all post-war credits were cashed now something like 306 £650,000,000 would be repayable amongst us all. I suppose each one of us has one or more of these credits tucked away somewhere, which some day we hope to cash. Of course, the Government cannot be expected to pay out £650,000,000 all at once, because it would have a considerable inflationary effect. That is why, when the Finance Act, 1946, was passed, the only people allowed to cash post-war credits were those of the ages I have mentioned. But I do not think it can be said that a great inflationary effect would occur if the provisions of the Finance Act, 1946, were now extended, so that on the death of anybody entitled to postwar credits payment could be made, thus enabling the estate to be completely wound up. I may be wrong, but I believe that it is impossible for the Government to do this by administrative action. At the same time, my noble friend has seized a timely moment to raise this question, because the Finance Bill is now before another place, and although we are unable to amend that Bill in this respect we may receive the help of the noble Lord, Lord Pakenham, who I am glad to see is going to reply, in suggesting to the Chancellor of the Exchequer that this is an Amendment which might well be incorporated in the Finance Bill now before Parliament.
It seems to me that in the case which my noble friend has cited, the man would have had sufficient post-war credits to pay off his landlady and to pay for the funeral he hoped to have. Why any person should be worried abort his own funeral I have never been able to understand. I am not very much bothered about what they do with my remains, but I know that some people feel quite strongly about this matter. After all, it was this man's money. If he had known the law he could have cashed his credits and had the money in the Post Office Savings Bank, instead of in the Chancellor of the Exchequer's hands. Had that been done, his landlady would have been paid and the local authority would not have had to provide a parish funeral. I should have thought his funeral would he covered by the National Insurance Act, but perhaps he was not insured. It seems to me that the, time has come when, in the case of those who die, provision might be made for the payment of post-war credits, so that their estates might immediately be wound up without all this fuss and bother. That 307 is what I hope the noble Lord will be able to tell us to-day—that His Majesty's Government will consider that proposal and possible embody it in the present Finance Bill.
§ 3.32 p.m.
My Lords, my noble friend Lord Saltoun has raised the question of the old people who die without having cashed the post-war credits to which they are entitled. I want to make the matter a trifle wider. I gave notice to His Majesty's Government (and I thank them for promising to give me an answer) that I would raise the general question of paying out post-war credits at death instead of under the present rules. Sooner or later, we all have to face our Maker, and on earth our relicts immediately have to face what in South America is called "a taking of accounts" —and the Inland Revenue are never backward in sending in their accounts. There must be few people who, when they die, do not owe money to the Inland Revenue. Their relicts have to realise the assets to pay off that grasping creditor, and the assets for some 12,000,000 or 13,000,000 people in this country will include, among other things, post-war credits.
Now, as I understand it at the moment, these post-war credits are not payable on death. Yet under the Finance Act of 1941 which established them, the Government seem to me to conclude a bargain between themselves and the individual, saying: "We are going to put aside certain money for you and it will be paid you in due course on the word of His Majesty's Government." In due course, regulations have been brought out for that repayment, and the repayment takes place at the age of sixty-five or sixty. But if the man or woman dies before attaining the appropriate age, payment is not made. Moreover, as I understand it, that credit is passed to a legatee and does not become payable until that legatee in turn reaches the age of sixty-five or sixty. If I understand it correctly, it means that some of these credits can go on for generations and generations unless the man happens to have the forethought to leave his post-war credit to some elderly aunt, to make certain that His Majesty's Government have to pay up in the end.
308 I regard that as a distinct breach of a moral obligation by His Majesty's Government. They have made the arrangement with a specific individual and, by these regulations, they try to shuffle off their responsibility into an arrangement with some other individual. I do not think that is morally right. I suggest that morally His Majesty's Government ought to pay out when a man or woman dies. If they can produce economic reasons to show that that would cause great inflation—which I do not believe they can—I should be prepared to say that they should pay out when that man or woman would have attained the paying-out age. That is the second best method. But the present system seems to me neither fair nor honest. I do not think it is a matter of great, momentous principle. I never ask His Majesty's Government to change their minds on matters of great principle because their hearts are hardened against melting, but on a matter of moral justice I feel perfectly justified in asking them to change their minds, and I have hopes that they will do so.
§ 3.37 p.m.
THE MINISTER OF CIVIL AVIATION (LORD PAKENHAM)
My Lords, I appreciate the spirit and the motives actuating the noble Lords who have spoken. If I may say so, it is unlikely that three such noble Lords would raise a matter of this kind unless there were something in it, but I hope before I sit down to convince them, and other members of this House, that there is nothing like as much in it as they suppose. In fact, there is not enough in it to make it desirable in the public interest to change the law, which would be necessary if anything of the kind which any noble Lord has contemplated were to be done. I should like to deal very briefly at the start with what may be called the general policy with regard to post-war credits. I will come to the details in a moment.
I believe that it has been agreed on all sides—and I think it still is generally accepted—that in view of our economic position the full release of all post-war credits cannot seriously be considered. I am sure noble Lords are all agreed about that—indeed the noble Lord, Lord Llewellin, specifically made that plain—although naturally all of us will hail with 309 joy and relief the day when in fact it becomes possible to release all these credits. It is also generally agreed, I think, that if discrimination is necessary, we have chosen the right policy in deciding that the first people to benefit should be the elderly. In this spirit it has been laid down that the only people who can claim their credits are men over sixty-five and women over sixty. That is the starting point and, I think, a generally acceptable one. If I understand the noble Lord, Lord Saltoun, aright, he desires to see this particular rule applied much more generously. The noble Lord, Lord Hawke, wishes to see it supplemented with a further rule that credits should be paid out at death, regardless of the age of the deceased. I hope I am interpreting both noble Lords correctly, but it is clear that the noble Lord, Lord Hawke, would go very much further and act much more widely than the noble Lord, Lord Saltoun.
May I take first the argument of the noble Lord, Lord Hawke, because quite frankly I feel that it represents a much simpler issue? To be honest, I came down to the House this afternoon unable to think of any special reason why beneficiaries as a class—people who benefit from a bequest—should be singled out for preferential treatment.
§ LORD LLEWELLIN
They are singled out immediately to pay over large sums in death duties to the Government. That is a very good reason.
I doubt whether many of the people whom the noble Lord has in mind would be paying very heavy death duties. The people with whom we are concerned today, surely, are small people. I do not think the noble Lord, Lord Saltoun, was very much concerned with death duties in the case, for instance, of the landlady whom he mentioned. I came down to the House this afternoon quite unable to see why beneficiaries as a class should be singled out—
The noble Lord has misunderstood me. I am not concerned at all with the beneficiaries. I am concerned with the original contract between His Majesty's Government and a roan or woman; that man or woman dies the Government refuses to pay the debt.
The noble Lord says that I misunderstand him, but I am 310 in the hands of the House and it is early in the day yet—we can thresh this matter out fully. The noble Lord was kind enough to give me notice of his point, and I think he has stuck closely to what he had in his notes. He said, if I understood him aright, that he wanted these credits to be paid out at death, regardless of the age of the deceased. But it is not the deceased who is going to get money: the noble Lord is asking that beneficiaries should be singled out for preferential treatment. Surely, the House will agree that I am dealing with the noble Lord's point. I am prepared to use the words "beneficiaries and creditors" if the noble Lord wishes to be more precise.
§ VISCOUNT SIMON
I am sorry to interrupt the noble Lord, but perhaps he will allow me to say that if I promise to repay a man a sum of money, I should describe such a man not as a beneficiary but as a creditor.
I am sure that in the case of the noble Viscount any such promise would be honoured "on the nail." But in the case of post-war credits it is, in fact, against public policy that everybody should be paid straight away. There is therefore no question of running away from a contract, and I think that the noble Lord, Lord Hawke, dragged a red herring across the trail when he made that, reference. These sums are not going to be lost to the beneficiary or the creditor; the question is whether these creditors should be paid regardless of age—whether they are twenty-five, forty-five or fifty-five—and paid ahead of all other categories. That is surely the point which Lord Hawke has raised. The noble Lord shakes his head. I do not want any misunderstanding and I am not sure whether he and I are on the same point. The noble Lord, as I understand him, thinks that whenever some elderly gentleman dies, or indeed whenever anyone dies, whatever his age, there should be payment on death. The noble Lord now nods his head, and so I presume I am carrying him with me. He claims that, whatever the age of the testator or the beneficiary or the creditor, there should be payment on death. I say frankly that, in the view of the Government, it would be quite impossible to apply a rule of that kind. As I have said, I came down to the House this afternoon unable to thank of any special 311 reason why beneficiaries as a class should be singled out; and, even after listening to the eloquence of Lord Hawke, I still cannot find any good reason.
At different times proposals have been made for the further release of credits, either by lowering the age limits or by paying the credits to certain additional classes of holders other than the old people. Some of these other classes undoubtedly make a strong appeal to our feelings. I have in mind particularly the disabled, the sick, people suffering from particular hardships of various kinds, emigrants who want to go away from the country, charitable bodies, and other deserving individuals and institutions. I imagine that many of these cases could disturb us all a great deal; and, having in mind these cases of hardship, I myself cannot see any reason why beneficiaries or creditors should be given a priority over these other categories that I have mentioned—and, indeed, many others which I could mention. Therefore while I fully appreciate the motives of the noble Lord, and while we all look forward to the day when all post-war credits will be paid out, I cannot hold out any hope of a change in the law of the kind which Lord Hawke has recommended.
I now come to the more intricate problems raised by Lord Saltoun. They are indeed intricate, as I am sure he will agree, and I hope the House will appreciate that I have taken all the trouble that one ought to take on an occasion of this kind. The noble Lord was concerned with the particular case of a man with no relatives, who died at the age of seventy-six leaving £6 in cash and uncashed post-war credits for about £49. The local authority buried the old man, and have a claim on his estate for the funeral expenses. I am afraid that I have not in my possession any other information than that with which the noble Lord supplied me before this afternoon's debate. He mentioned in his speech that the old gentleman had a landlady—
If I may interrupt the noble Lord, the old gentleman had these post-war credits and, not knowing the rather intricate conditions attached to them, he thought they could he cashed on his death. He kept them and told the landlady that she was to have them 312 for the purpose of giving him a decent funeral. In effect, he had a pauper's funeral and the difference between the cost of that and the amount he left will be pocketed by His Majesty's Government.
The noble Lord gave me the name of the old gentleman and I have followed up the case. But some of these particulars are new to me this afternoon, so that I have not been able to follow up the details of the other persons concerned. My information is that the local authority who paid for the funeral are holding the post-war credit certificates and are not able to cash them. The noble Lord considers that this is a kind of hardship which should not be permitted to happen. I suppose the noble Lord is aware that legislation would be necessary to remove such a hardship; if so, I take it that he would wish such legislation to be carried through.
Let us be absolutely clear about the existing law—and I am sure the House will realise that my erudition on this point, while newly come by, has been assisted by the best authorities. I have said that in principle credits can be claimed by men over sixty-five years of age and by women over sixty. In what follows I confine myself to the masculine case, for, in fact, ladies are treated in the Same way, mutatis mutandis. The simplest case is where a man of over sixty-five claims a post-war credit and draws it out in cash during his lifetime. There is no difficulty there. There are two other broad headings. First, there is the case where a man over sixty-five claims the credit during his lifetime but dies before he receives it, though the interval may not be a long time. The other case is where, for some reason, the man over sixty-five fails to put in a claim during his life. In the first case, where he puts in a claim during his life and he dies during the week or fortnight or whatever it may be that follows, the executor or personal representative will receive the cash, and he will pay it over to any beneficiary or creditor, whatever their ages. So here again all is plain sailing. I do not think the noble Lord will quarrel with the existing law or procedure, so we cover two out of the three main headings quite comfortably.
But the third kind of case is admittedly harder. We approach the case indicated 313 by the noble Lord, Lord Saltoun, where no claim has been made during his life by a man over sixty-five who could, of course, have put in a claim. Under the existing law, the executor transfers the post-war credit to the beneficiary or the creditor. I say the "beneficiary" advisedly, because I have my eye on the distinction between "beneficiary" and "creditor" to which the noble and learned Viscount, Lord Simon, has called attention. The gentleman or lady to whom the money has been left can cash the post-war credit when he reaches the age of sixty-five or she reaches the age of sixty. That means that if the beneficiary—I am not talking of a creditor—is a gentleman of forty-five, he will have to wait twenty years, unless, of course, all the post-war credits are repaid sooner or unless the law is altered meanwhile. This is the distinction, and I am grateful to the noble and learned Viscount for calling attention to or implying such a distinction earlier. A creditor or an ageless institution like a local authority will have to wait until all the post-war credits are paid out in due course. Therefore, if you are a creditor—say a landlady to whom somebody owes money when he dies—you will have to wait until all the credits are paid out in due course.
Whatever your age. That is the distinction between a creditor and a beneficiary. In this connection, two kinds of possible hardship may be alleged. First of all, the beneficiary, taking him as a gentleman to whom somebody has left something, may feel that he should not be in a worse position merely because the testator had not put in a claim before his death. The beneficiary may say: "If only my uncle had been wise enough to put in this claim just before he died, although I am only forty-five I should have received it straight away. As my uncle failed to put in a claim, I shall have to wait until I am sixty-five." The beneficiary may feel that there is an clement of hardship there. I return to what I said earlier to the noble Lord, Lord Hawke. There is no special reason why a young or middle-aged beneficiary, somebody who has just received a legacy or bequest of any kind, whatever the age of the testator, should have any priority at all—at any rate, as we see it— 314 over all the cases of hardship that I mentioned earlier—the sick, the disabled, the emigrants and various other categories. I see no reason why, just because you are a beneficiary, you should have this special preference.
§ LORD LLEWELLIN
May I interrupt for a moment? Let us assume the case of a man dying who has £200 after death duties are paid and £100 to come under one of these post-war credits. Let us assume that there are three beneficiaries entitled to equal shares of the estate. One of those happens to be a lady over sixty. If the executors allocate the post-war credit to her, she can cash it, but if they allocate it to one of the other beneficiaries, he cannot. That is the result of not treating this sum, as surely it ought to be treated, as part of the estate and repayable at once.
While naturally the noble Lord will not ask me to give a legal opinion off-hand as to whether that be so, prima facie I can certainly follow his argument. However, as regards death duties, various arrangements were made in the Act with which I will not trouble the House because they will not arise this afternoon; but I can follow the noble Lord's point. I am saying that the beneficiary may feel that lie should not be in a worse position merely because, the testator, his uncle, shall we say, did not put in a claim before his death. I repeat that I cannot see why this beneficiary should have any preference at all over any of the other categories of hardships with which we have great sympathy. There is the particular case of the young or middle-aged beneficiary—I am talking now of the young or middle-aged beneficiary, somebody of twenty-five to forty-five, whose testator puts in a claim for a post-war credit and dies before it is cashed. That beneficiary gets a special advantage. A man of, let us say, twenty-five, has an uncle who puts in a claim and dies within a few days of putting it in; he is able to 315 cash that claim although he is quite a young man. That one type of case arises for administrative reasons. But that leads on to the general argument that, because a particular advantage is derived by a beneficiary in that one instance, young or middle-aged beneficiaries as a whole should benefit. We reach the broad point: Do we, on the whole, consider that young or middle-aged beneficiaries should, as a category in the community, be given a special preference over many other classes, such as the sick and disabled? We say emphatically, No.
There remains the final refinement of the problem. Assume the case of the creditor where no claim was put in by the testator before he died. Undoubtedly, that comes very close to the noble Lord's instance. The creditor, unlike the beneficiary, cannot cash his credit at sixty-five, nor can the landlady cash hers at sixty. He or she has to wait till the day when all post-war credits are cashed. I do not know whether that will be generations hence, as was gloomily prophesied earlier, or whether it will be much sooner than that, but, at any rate, the creditor has to wait till the day when all credits are cashed.
I hope it will be to-morrow. In the case mentioned by the noble Lord, at any rate so far as I was able to study it in advance as it was put to me by the noble Lord, where the creditor is a local authority, I cannot believe that hardship is involved. The noble Lord has since mentioned the landlady and she is a new personality in this discussion, but, so far as the local authority was concerned, of which alone I have had official knowledge up to the present. I cannot believe that hardship is involved.
May I interrupt the noble Lord? The question I wish to ask is this. Can the rule be altered or, if not, will His Majesty's Government give the widest publicity to the rule as it stands? Because this poor, old, ignorant man had a sort of blind belief that the Government would not do this to him he thought his money was all right in the hands of the Government. He planned it out for a good funeral, and he got a pauper's funeral. If that sort of situation is common, it ought to be made widely known 316 to these old men, to make them draw their post-war credits.
There is a great deal in what the noble Lord says about the importance of publicity. I can conceive of a case where an elderly landlady (for example, someone already over sixty) is a creditor in a situation of this kind, but she is not able to draw the money until the great day when all credits are cashed. I quite agree that in a case of that kind our sympathies become very readily involved. But I am afraid that considerable administrative difficulties would be involved in any attempt to alter the law—and to meet the noble Lord the law would have to be altered. I would only say, therefore, in conclusion, that it is not for me to raise any hopes this afternoon, but I will make certain that everything that has been said is placed before my right honourable friend the Chancellor of the Exchequer, who, I am sure, will give the closest attention to the careful and sincere arguments that have been presented to the House this afternoon.
§ 4.3 p.m.
§ VISCOUNT SIMON
My Lords, we have all had occasion to admire the explanations which are offered by the noble Lord opposite, who always makes the best possible use of the brief which he gets from the Treasury. We make no sort of complaint of what he has been so carefully explaining to us this afternoon, but I confess he has roused a new anxiety in my breast as I happen to be over sixty-five, and I suppose the same is true of anybody else who is over sixty-five. I never appreciated before that this meant that unless I act quickly and make the Treasury pay me something, which I have never asked them to pay me yet, there is a danger that that something which is due to me now will not be paid to the person who may claim it as my personal representative after my death. I never appreciated that until now. If that is the case, I think everybody in this country over sixty-five will be much concerned to make this claim against the Treasury at once, and I doubt whether that will be to the advantage of the Treasury. I should have thought that, alike on grounds of commonsense and of economic prudence, it might well be desirable for the law to be that once this claim has become justified, once a man over sixty-five is entitled to be paid, he shall not 317 suffer in the person of those who take his property when he dies merely because they are all young. What the noble Lord has been instructed to say has the effect of inviting everybody over sixty-five to make his claim on the Treasury at once. That was the effect of his speech upon me.
The other thing is—it is no fault of the noble Lord's—that If do not understand this attempt to divide the persons in this drama into the person over sixty-five who is entitled now to a post-war credit, and what is called a "beneficiary." I do not know what it means. When a person, whether over sixty-five or not, dies, he is possessed of a certain estate or a certain amount of property. How that property is distributed depends upon his will, or if he has not made a will, it depends upon the law which provides how the property is to be divided on an intestacy. What has the age of one or other of beneficiaries to do with that? I appreciate (and no doubt the noble Lord is right in saying) that this is the effect of the present regulations, but it is a very odd result indeed. Every one of us, I presume, is entitled at this moment, if over sixty-live, to be paid a post-war credit. Suppose that I make my will. Perhaps I give my property to my grandchildren, all of whom are very much under sixty-live. What an extraordinary thing that something to which I am already entitled, which I might be paid now if I chose to claim it to-day, but which I am leaving in the hands of the Treasury for the country's benefit, ceases to be now payable, just because I make a will and leave my estate to be divided among small grandchildren! The result is that this amount cannot be paid for years and years.
I really do not understand the noble Lord when he talks about beneficiaries. There are a great many cases, of course, where wills contain a large number of beneficiaries. There are cases when there are debts. In the ordinary case of the distribution, when there is no will, the property goes to the widow and the children, and these may be of different ages. I fully understand that the noble. Lord is saying only what he is authorised to say, and we are always grateful for his explanations. I would respectfully say that his remarks reveal a much larger 318 point than I had supposed, because I cannot think that it is in the interests of the country at this time of day that a person over sixty-five should be advised by his solicitor to claim this money at once. That would not seem to be to the advantage of the country at all. Therefore I hope that the noble Lord will seriously represent to the Chancellor of the Exchequer that there is a great deal of common sense, as well as justice, in providing to meet the sort of case which my noble friend Lord Saltoun has mentioned.
I realise that it is necessary to impose a limitation of sixty-five or sixty, as the case may be, before a man or a woman receives the post-war credit to which he or she is entitled. But it seems to me a most curious state of affairs—and I am speaking in the presence of noble Lords who know a great deal more on financial subjects than I—if such a person who is already entitled to the money, leaves it either deliberately or otherwise, in the hands of the Treasury and then dies, that the effect of that is that nobody is entitled to be paid until a much later date. It sounds as if a little money is saved to the Treasury, but I doubt whether it does in fact save money in the end. It is a very queer arrangement. I do not say more because there may be an explanation which I have not followed. That was the impression left on my mind as I listened to the noble Lord's statement.
§ 4.8 p.m.
§ LORD BALFOUR OF BURLEIGH
May I add one word in support of what has been said with such cogency by my noble and learned friend opposite? It came to me as it did to him, as a great shock. Having attained the age of sixty-five must look after my small interests, small because they are all subject to a very meagre minimum in this matter. Incidentally, it came as a great shock to me that everybody over sixty-five should be described in somewhat pitying, contemptuous terms as "old gentlemen."
§ LORD BALFOUR OF BURLEIGH
Anyway, pitying. Some of us over sixty-live years of age do not feel quite so old as all that. But, in fact, when we are over sixty-five it is perfectly clear that we have got to take steps at once to protect 319 our dependants, because the noble Lord who replied was at pains to say that there was to be no specific preference for the young or middle-aged. For whose benefit are most of us keeping these post-war credits? They are for our children and grandchildren. There ought to be a preference, and we ought to see to it that there is a preference for the young, because all of us over sixty-five are engaged in scraping together every penny we can get in order to protect our dependants. Heaven knows, it is hard enough in these days of high taxation to leave anything to our dependants, and quite clearly those of us who are over sixty-five have got to queue up to-morrow at the Post Office, and make sure that what little bit we have in post-war credits we receive from the Treasury as soon as possible. I hope the widest possible publicity will be given to this matter.
§ 4.10 p.m.
§ LORD ROCHE
My Lords, I also should like to say a few words upon this matter. I had not intended to speak, but I feel impelled to do so because of the argument which the noble Lord opposite has been instructed to put up. I know that he has only followed instructions, and he has presented his case, I am sure, very fairly. I am in the same position as the last two speakers. I intend to go tomorrow to ask the people at my bank whether they have claimed my post-war credits, and, if they have not done so, to tell them to be sharp about it. I suggest, to use a familiar expression, that those who have instructed the noble Lord, Lord Pakenham, are barking up the wrong tree.
It is not correct to concentrate on this question from the point of view of a creditor or beneficiary. It concerns the property of a dead man. I feel some sympathy—I do not know whether the noble Lord, Lord Pakenham, does also—with the old gentleman who desired to have his own funeral and instead got what he had always abhorred—as does every decent working man—a pauper's funeral. I feel that to those who have not bankers to whom to resort this is a most important matter, and I suggest that it is a point which ought to be borne well in mind. These people keep these things—just as they keep someone's cheque—in order that they may be put to use at an appropriate time. In this 320 connection, I suggest that the appropriate time ought to be the time of death, and I do not know why sickness should be regarded as a greater infirmity than death. I could not help noticing that the noble Lord seemed almost to regard a sick man as being much worse off than a dead man. I do not share that view. I suggest that the noble Lord should seriously ask those who instruct him to think again about this matter, and to see whether they cannot get rid of, I was going to say, all this nonsense, but I mean all this rather illogical talk about the money being the money of creditors in the one case and of beneficiaries in others. It should be regarded as the property of the dead man, and should be so treated.
§ 4.12 p.m.
§ THE MARQUESS OF SALISBURY
My Lords, I think we all sympathise with the noble Lord, Lord Pakenham, in the unenviable position in which he has been put. I thought he made the best of a very bad case. On this point which has been raised by Lord Saltoun we have some of the greatest lawyers on our side, and the case is really indefensible. It is the case of a man who has satisfied conditions which are laid down to be paid what is already factually his money. The fact that he dies before he technically puts in a claim, does not alter the position. We believe that to be unanswerable. I ask the noble Lord to put this case to his right honourable friend the Chancellor of the Exchequer, and to tell him how very strongly this House feels on these questions. Two points in the noble Lord's original remarks struck me particularly. With regard to the first I do not say that I take exception to it, but, I was faintly shocked by it. Lord Pakenham seemed to indicate to the House that there were really very few of these cases and that therefore we need not bother. We need not bother because the cases were so few.
§ THE MARQUESS OF SALISBURY
Perhaps the noble Lord said that there was very little in it, or very little in the case put from this side of the House, so possibly I was misrepresenting him. In that case I withdraw what I originally said, and re-emphasise that we think there is a great deal in this. The other point he undoubtedly made. He said that he 321 thought he ought to warn the House that this might mean legislation. Why not? What are we here for? Why are we a Legislative Assembly if we cannot pass legislation? What is a better reason for legislation than to redress legitimate grievances on the part of individual citizens? If the citizen is a poor man how much greater is the grievance! I know that the argument that legislation will be needed is constantly put up by Government departments, but I hope that the noble Lord will not be taken in by this perfectly specious contention. In any case, we have just heard it announced that we are going away—and I am delighted to hear it—for nearly three weeks at Whitsun. So far as I know; there is not a very heavy programme of work to be dealt with afterwards. Therefore, I submit to the Government that if they feel that a small amending Bill would rectify what we believe to be a serious grievance, the Government should take steps to see that one is put forward.
§ 4.16 p.m.
§ VISCOUNT SAMUEL
My Lords, I have no intention of making a speech but I should like to put a question to which I hope Lord Pakenham will find it possible to give a brief reply. With regard to death duties he has told us that there are special provisions relating to these cases. He did not give us any of the facts, but perhaps he will tell us the principle to be adopted in this matter. No doubt, the sums concerned are very small, but the question of principle does arise. Are these unpaid credits regarded as part of the estate of a deceased person, or are they not? If they are, then clearly the person who inherits the estate will have to pay the death duties and will not be able to touch any of the capital. If they are not regarded as part of the estate what status do they have until all these credits are paid off, which apparently is to be at the sounding of the last trump?
My Lords, I should like to ask the noble Lord if, when he speaks again, he can tell us whether these post-war credits are aggregated for estate duty and whether interest accrues on them.
§ 4.17 p.m.
§ LORD WEBB-JOHNSON
My Lords, I intervene only to plead with the noble Lord who has replied on behalf of the 322 Government that, besides bringing to the notice of the Chancellor the case which has been put forward by Lord Saltoun, he should also press upon the Chancellor the point which has -been raised by the noble Lord, Lord Llewellin—the importance and the desirability of people being able to wind up an estate. We have heard of the intentions of the noble and learned Viscount, of bequeathing shares of his estate to his grandchildren. I do not know the age of any of the noble Viscount's grandchildren, but probably they are in the twenties. This means they will be obliged to wait about forty years, carefully preserving these bits of paper which we have been discussing, before they can claim payment. There may well be cases in which beneficiaries will die before receiving payment, and will leave these bits of paper to their grandchildren. So in about three turns of the wheel the year 2070 will be reached, and the noble Lord who will have taken the place of the noble Lord, Lord Pakenham, may be faced with the fact that an individual 120 years hence is unable to establish his right to be paid. Surely it must he desirable that the estate should be wound up. I think this is a point which might well be brought to the notice of the Chancellor of the Exchequer.
§ 4.19 p.m.
My Lords, may I, with the leave of the House, speak again? I understand on very good provisional advice—I will confirm this by more careful investigation—that these sums do not enter into death duties at all. They are excluded from death duties.
Interest is not, I understand, allowed on these sums and they do not enter into the death duties.
If I may, I will venture now to return to the point from which we started. There are intricacies below intricacies connected with this matter of post-war credits. If I may say so, with great respect, though I often differ from noble Lords opposite on political points I seldom differ from them on a point of broad human justice. To-day I feel myself somewhat at a loss 323 because there seems to be widespread feeling in certain quarters that young beneficiaries are deserving of quite exceptional sympathy.
The bargain made between the Government and the individual is terminated when the individual dies, and I think he ought to be paid out. The noble Lord drags in beneficiaries, and so on, which is the result, presumably, of muddled thinking by his official advisers.
I think the noble Lord has made—I will restrain myself—a very unworthy remark. What on earth is he referring to? I cannot think he will carry anyone else with him when he makes a remark of this sort. He can accuse me of all the muddled thinking he likes, and may prove it if he can, but to try and fasten this on my advisers, who possess an intellectual capacity which may cause a good deal of envy both in myself and the noble Lord, is unworthy. I hope he will adopt a different line on other occasions.
The noble Viscount, Lord Simon, and the noble Lord, Lord Balfour, obviously feel it will be immensely hard if they fail to put in their claims and then die—which I hope will not occur, at any rate in the future we are discussing this afternoon—and their children, to whom the claims are loft, are not able to cash them immediately. From the tone of the discussion one might almost think that the heirs will be deprived of this money. Of course, they will be able to cash the credits eventually. Why the children of some mature member of the House—I must not use the expression "elderly gentleman"—should be able to cash his post-war credits before some extremely sick person or disabled war veteran, I cannot understand. That is why I say there is a difference in feeling.
§ VISCOUNT SIMON
The noble Lord says he does not understand, and as he referred to me, perhaps he will allow me to put it in simple terms. The case we are considering is one where an individual is entitled to a payment. If it were not for a special provision of the law he might assign it, but he cannot do so 324 because it is a payment owing to him by the State. The proposition is very simple. If he dies entitled to a payment, the right to the payment should not disappear because he has died. That is all.
I should like to add that here is an old man who died after doing what many poor old men do—namely, work to pay for their own funeral, and keep that money sacred. When he died, the money to which he was entitled was impounded; he was given a pauper's funeral and the Government made £42 on the transaction.
I gather from the account of the noble Lord that the individual died intestate. Speaking subject to legal correction, I presume that, apart from any refinements we are discussing this afternoon, if he left a sum of money, that would have passed to the Government. We must not import a special element into the discussion.
§ VISCOUNT SIMON
It is not the law of England that because a man dies intestate the Government "sweeps the lot."
I will not compete with the noble and learned Viscount on the law of intestacy. I am sure that he will make adequate provision against that ever occurring. I would submit to the House that in this case there was a special element arising from the fact that this gentleman was intestate.
But I understood that he had a perfectly good funeral. I do not know who else was to provide a funeral. The local authority would presumably have done it in any case, if he did not leave money for anyone else to provide the funeral. But I do not want to concentrate on this individual case.
They should not have given him a pauper's funeral at public expense, but a proper funeral, with all the things he wanted, paid for by his own money.
Perhaps the funeral was not up to the standard desired by the noble Lord, but I think he will see what I mean. There are at least three contentions which have been submitted from the other side. When I say that I am anxious to inform my right 325 honourable friend the Chancellor of the Exchequer, as I am asked to do by the noble Marquess the Leader of the Opposition, I should like the House to see that there are three propositions which have to be submitted on their behalf to my right honourable friend. First, there is the argument that all beneficiaries should receive post-war credits in cash immediately. That was what the noble Lord, Lord Hawke, suggested, but I do not think that is what other noble Lords are suggesting.
I did not suggest that all beneficiaries should receive cash immediately, but only on death.
It is not the beneficiary who dies. It is the beneficiary, as soon as he becomes a beneficiary, who is to receive the money.
I do not want to start a quibble here. Surely it is the question of a beneficiary and not of a deceased person. That seems common sense.
§ LORD LLEWELLIN
The proposition is that the estates of all deceased persons who are entitled to post-war credits should get them. They might not go to the beneficiary; they might be taken by the creditors; but they should be credited to the estate.
The first proposition, at any rate, is that all beneficiaries and creditors should receive in cash immediately the full amount of the post-war credits. That is one line of argument, but I doubt whether it is likely to commend itself to the majority of members of the House.
Another argument is that all the people who are the beneficiaries of those who would have been entitled to the credits should receive cash immediately if the testator was over sixty-five in the case of a gentleman, and over sixty in the case of a lady. That is a different proposition. It applies to all beneficiaries or creditors of those whom I venture to call "elderly" people. If anyone can supply me with a better word I will gladly use it. That is a much narrower proposition. Finally, there is the proposition, which I ventured to think would have aroused sympathy, though I could not promise any governmental support 326 for it, that not only beneficiaries but also creditors of elderly people should receive the credits in cash immediately if these beneficiaries and creditors were themselves over sixty-five—or sixty in the case of ladies. That was the narrower point to which I addressed myself in the first place. I lay before the House these three propositions, each one narrower than the last, because I am anxious to convey fairly to my right honourable friend what your Lordships have said. I understand that these three propositions have been put forward with varying degrees of support. The whole subject has aroused a great deal of sincere feeling and a good deal of disquiet, and I am sure that my right honourable friend will give it his fullest consideration. Noble Lords appreciate that I cannot say more this afternoon.
There is one danger which noble Lords have mentioned which does not seem to me so great as they suppose. The noble and learned Viscount, Lord Simon, and the noble Lord, Lord Balfour of Burleigh, said that if the situation is as I have stated they will rush to cash their post-war credits, and that that will have an inflationary effect. That was the implication from what they said. May I suggest that all they have to do in that case is to cash the post-war credits and put the money into National Savings? There will then be no inflationary effect. With that thought, I thank the House for their courtesy and promise that all these suggestions will be laid faithfully before my right honourable friend the Chancellor of the Exchequer.