§ Mr. C. BATHURSTasked the President of the Board of Agriculture whether there is any Continental precedent for a national agricultural co-operative credit system, under which rural credit societies obtain loans either from the Government or from large joint stock banks, without the existence as an intermediary of a central or district bank to act as a clearing house for bulking loan requirements on behalf either of the Government or of such joint stock banks?
§ Mr. RUNCIMANSo far as I am aware, the answer is in the negative, but the mere fact that there is no Continental precedent would not seem to be sufficient reason why co-operative societies in this country should not obtain loans from joint stock banks without any such intermediary as the hon. Member suggests, provided that the banks are willing to advance money to them directly.
§ Mr. C. BATHURSTasked the President of the Board of Agriculture whether the special commissioner who was sent by the Board two years ago to Germany to study the subject of agricultural credit in that country has yet reported to the Board; if so, whether such Report favours the constitution of a central bank as an intermediary between co-operative credit associations and the large joint stock banks, or advocates loans from the latter direct to the associations; and whether such Report will be published?
§ Mr. RUNCIMANThe Report to which the hon. Member refers is in the press, and will be published as soon as possible.
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§ Mr. C. BATHURSTasked the President of the Board of Agriculture if he is aware that for many years agricultural credit associations in India obtained loans direct from the Indian Government, but that the system proved unsatisfactory and is now being superseded by a system interposing central banks between the Government and the associations; and whether he will take into account Indian experience before maturing the agricultural credit scheme of the Board?
§ Mr. RUNCIMANI am aware that in India provision was made for the granting of loans from State funds to agricultural credit societies in backward parts of the country to assist them in their initial stages. It was not found necessary to grant such loans on a large scale, but I have no reason to suppose that the system where it was applied, proved unsatisfactory, and I understand it is still made use of in exceptional cases. I may, however, point out that I have no intention of making loans of State funds to such societies in this country, and that the arrangements made with the joint stock banks are in accordance with the trend of the movement in India, where also the joint stock banks are now showing their willingness to make advances to similar societies.
§ Mr. C. BATHURSTasked the President of the Board of Agriculture whether, in formulating a scheme for promoting the development of agricultural credit associations and the availability of cheap money for loans to small holders, he will take into consideration paragraph 114 of the Report of the Board's Departmental Committee on Small Holdings, which was presided over by the late Lord Onslow and reported in 1906, and the recommendation therein contained in favour of a central co-operative agricultural credit association rendering available to small holders advances from Post Office Savings Banks deposits?
§ Mr. RUNCIMANThe recommendation to which the hon. Member refers was fully considered before the Board's proposals were formulated.