PAYMENT OF WAGES BY CHEQUE (Hansard, 10 December 1958)

§ LORD FRASER OF LONSDALE
My Lords, I beg to ask the second Question which stands in my name on the Order Paper.

§ THE MINISTER WITHOUT PORTFOLIO (THE EARL OF DUNDEE)
My Lords, my right honourable friend the Minister of Labour and National 164 Service is considering this matter in consultation with his National Joint Advisory Council.

§ LORD FRASER OF LONSDALE
My Lords, without suggesting that the working man should be compelled to accept cheques instead of cash, would Her Majesty's Government consult with the Trades Union Congress to see whether the very real advantages of using a bank account might not become available to working men generally by good will and consent, so that they may enjoy the facilities which we enjoy in using bank accounts, as well as providing security in this present situation?

§ THE EARL OF DUNDEE
My Lords, the Trades Union Congress is represented on the National Joint Advisory Council which considered this matter at the beginning of 1957 when the Cheques Act was before Parliament. I think everybody is agreed on the great advantages to be derived from paying wages by cheque. But there are also some disadvantages, one of which is the objection of the retail shopkeepers who represent that if a large number of wage earners were paid by cheque they would be asked to cash cheques on pay day by large numbers of people so that they would have to accumulate large quantities of cash. They were afraid that the attention of the robbers would then be transferred to them, instead of to the vans carrying cash for the employers. But the matter is being reconsidered at this moment by the Council, and my right honourable friend does not want to form his own opinion until he has received their considered advice.

§ THE EARL OF SWINTON
My Lords, I think that that is wise. Can we be assured that all the American experience on this subject, which is, I think, large, will be put at the disposal of both the Minister and the T.U.C.?

§ THE EARL OF DUNDEE
My Lords, I am much obliged to the noble Earl for making that suggestion. I will certainly convey it to my right honourable friend to make sure that that is being done, though probably it has been done already.

LORD HAWKE
My Lords, would Her Majesty's Government tell me whether it is already legal to pay wages by cheque 165 if the cheque is drawn on a bank which has power to issue notes and has a branch within fifteen miles of the working place of the man; and whether Scottish banks and their branches in England fulfil those conditions in many places?

§ THE EARL OF DUNDEE
Yes, that is correct, I think, under the Truck Act, 1831. It is legal to pay wages by a special cheque drawn on a bank which has its own powers of note issue. If the Scottish banks who have that power were within that distance, I believe that would be quite possible.

§ LORD LAWSON
My Lords, may I ask whether the noble Earl is aware that the Trades Union Congress would have to make further investigations before it could give authority to this suggestion, and that those who know the difficulties at first hand of people who have to spend their wages are very doubtful about this suggestion because of the embarrassment which it would cause to the people who received wages in the form of cheques?

§ THE EARL OF DUNDEE
My Lords, I am indeed aware of these doubts and possible objections, and I have no doubt that they will be fully considered by the Trades Union Congress representatives on the National Joint Advisory Council.

LORD REA
My Lords, in view of the general interest in this matter, could the noble Earl give any indication as to when a decision is likely to be arrived at?

§ THE EARL OF DUNDEE
No; but I understand that the National Joint Advisory Council are meeting to-morrow to consider it. I do not think I can say how long it will be before they present their revised conclusions—because they have already considered the matter more than a year ago—to the Minister of Labour.

LORD SALTOUN
My Lords, is it not the case that it is a general habit of people who receive their wages in cash to divide the money they receive—so much to be spent on this, so much on that and so much on something else, so that, somehow or other, it is all, or nearly all, spent in the course of the week? Would not payment by cheque encounter the obstacle of running up against the formed habit of the people, although if 166 this were done it might, to the advantage of the country, lead to saving in much lower wage groups than at present?

§ THE EARL OF DUNDEE.
My Lords, there are certainly considerations on both sides.