A History of Banks for Savings in Great Britain and Ireland
by William Lewins · English · Gutenberg #42583 · 916,778 chars · public domain (US)
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Title: A History of Banks for Savings in Great Britain and Ireland
Author: William Lewins
Release date: April 22, 2013 [eBook #42583]
Most recently updated: October 23, 2024
Language: English
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*** START OF THE PROJECT GUTENBERG EBOOK A HISTORY OF BANKS FOR SAVINGS IN GREAT BRITAIN AND IRELAND ***
Transcriber's note:
Text enclosed by underscores is in italics (_italics_).
History Of Savings Banks.
A HISTORY OF BANKS FOR SAVINGS IN GREAT BRITAIN AND IRELAND,
Including
A Full Account of the Origin and Progress of
Mr. Gladstone's Financial Measures for Post Office Banks,
Government Annuities, and Government Life Insurance.
by
WILLIAM LEWINS,
Author of "Her Majesty's Mails."
London:
Sampson Low, Son, and Marston,
Milton House, Ludgate Hill, E.C.
[All Rights reserved]
London:
Printed by R. Clay, Son, and Taylor,
Bread Street Hill.
TO
THE RIGHT HONOURABLE
WILLIAM EWART GLADSTONE, M.P.
_CHANCELLOR OF THE EXCHEQUER_,
&c. &c. &c.
THE GREATEST LIVING AUTHORITY ON ALL MATTERS OF FINANCE,
WHOSE NAME IS NOW INTIMATELY AND DESERVEDLY
CONNECTED WITH ALL THAT RELATES TO
THE SUBJECT OF THESE PAGES,
This Work
IS BY PERMISSION
MOST RESPECTFULLY DEDICATED.
PREFACE.
The present volume is offered as a contribution to the history of a
number of provident schemes, which, though quietly working in the
country for many years, and affecting to no small extent the social
condition of great masses of the people, can scarcely be said to have
found an annalist. I think I may fairly consider that the ground
covered by this work has not previously been occupied. In saying so
much, I do not forget the only book which has hitherto emanated from
the British press on Savings Banks. Mr. Scratchley's _Practical
Treatise on Savings Banks_ deals, however, with the question
technically, and is meant avowedly as a text-book for actuaries and
those employed about Savings Banks. The present volume, on the
contrary, while it may be supposed to possess some interest even for
this limited circle, is not meant to take the place of the above, but
seeks its public amongst general readers, and amongst those who,
either from inclination in that direction, or through connexion with
them as employers, take an interest in the progress of the industrial
classes of our country.
Treating as this volume does of useful practical schemes and
matter-of-fact topics, I have sought to avoid all matters of
speculation, to speak in very plain terms and without waste of words,
and, whilst noticing in their proper order all the different proposals
having to do with the subject, to refrain from venturing upon any
myself. My aim has been to give a full and accurate account of the
early history of Savings Banks; and as subsequently to their origin
the discussions in Parliament with regard to them and kindred subjects
were no incorrect reflex of the feeling in the country at different
periods, I have also dealt fully with the parliamentary history of
these institutions. In this way Savings Bank reformers, both in and
out of Parliament, and their measures of reform--many of them ending
in the establishment of different kinds of supplementary banks--are
made to pass under review; and the names of those who framed the
original schemes, as well as of those who tried to improve upon them,
are rescued, for a brief space at any rate, from a state of obscurity,
if not of oblivion.
With respect to the latest modification of the Savings Bank principle,
as exhibited in the measures brought about within the past few years
by Mr. Gladstone, great efforts have been made--as great efforts have
been needed--to treat all the questions involved fully and
impartially, and to accord these important and far-reaching measures
their due place amongst the other wonderful provident schemes of the
present century.
Great pains have also been taken to ensure perfect accuracy, both as
to facts and figures, and my acknowledgments are due to many gentlemen
who are acquainted with the subject in all its bearings, who sent me
information, or answered my inquiries, with great readiness and
cordiality. It is less necessary to mention any of these gentlemen in
this place, inasmuch as reference is frequently made to their
assistance at the proper place in the body of this work; but it would
be wrong to omit to state that, with regard to Mr. Gladstone's recent
measures, I have had every facility granted me by the Post Office
authorities for obtaining the necessary and the most recent
information respecting these schemes, and that this assistance has
been rendered in a manner which calls for my heartiest thanks, as the
only sufficient or fitting acknowledgment.
Dealing as I have done with what Mr. Carlyle will allow to be one of
the "side sources" of history, I venture to hope that some of the
facts now gathered together may not be without their interest to the
student of human progress in some of its highest aspects; while to all
those who are directly concerned in such schemes, and to masters of
workmen, to whom the concluding parts especially are more particularly
addressed, this volume is offered, with some confidence that they will
find much new and original matter in it, and some old matter put in a
new light.
An Appendix is added, giving the Acts, or clear abstracts of Acts, at
present in force for all the different descriptions of Banks for
Savings, together with some of the latest statistical information
which may be thought of value.
W. L.
_London, May 24, 1886._
*.* Two questions connected more or less with my subject have been
brought into prominence by the action of Parliament since the present
work was completed, and to these questions it may not unreasonably be
expected that I should in some way refer. The first, or the Savings
Bank qualification in the new Reform Bill, concerns Savings Banks and
Savings Bank depositors very intimately; the second question, or the
proposal of Mr. Gladstone to employ a portion of the money of Savings
Banks in reducing the National Debt, can scarcely be said to have an
immediate bearing upon either.
With regard to the Savings Bank qualification, I may, perhaps, be
permitted to say that, though received with hostility in some quarters
and indifference in others, the balance appears to me to be in favour
of the proposal. In most respects, if not in all, the qualification
may be defended on the same grounds as the Forty Shilling Freeholds;
the investment is about the same; the one is open to much the same
objections as the other, and there are similar merits in each. Votes
may be manufactured under the one equally as under the other, and it
is not easy to understand why those who support the one "Bye
Franchise" should oppose the other. Little trouble will accrue to
Savings Banks under the Act; and the money forming the qualification
may oftentimes be allowed to remain in the bank, whereas under other
circumstances it might be squandered in unnecessary or unprofitable
expenditure. The distinction may be hard on others quite as worthy of
the franchise, but who may be in some way unfortunately circumstanced;
and it may seem arbitrary to those who have an equal amount invested
in some other shape: but these are the sort of arguments which may be
brought against Fancy Franchises of any kind with quite as much reason
as against this particular one. Working men who may claim the
Franchise on the Savings Bank qualification will not be able to keep
the fact secret that they are depositors, and that up to a certain
amount; and they must submit, on misfortune overtaking them, to be
deprived of a privilege which they may have learnt to prize: but,
notwithstanding all these and some other minor considerations, I
cannot help regarding the Clause as, on the whole, a fair and
reasonable acknowledgment of the merits and claims of many of the best
portions of the community, who were not influenced by the
consideration of this electoral qualification when they originally
commenced the practice of provident habits, and also of the claims of
others who may not be unduly influenced by the prospect of citizenship
which the Clause may henceforth hold out to them.
Mr. Gladstone's recent proposal to convert the 24,000,000_l._ of
Consols, invested by the nation in Savings Banks, into Terminable
Annuities concerns the Nation itself much more than Savings Banks. So
far, indeed, as the matter affects the trustees of Savings Banks, or
depositors in them, it was settled some years ago when the money was
made a book debt, and the Government became the banker, as it were,
for the sum in question. What the Government now does with the money
is no concern of Savings Banks. This is put so plainly by Mr.
Gladstone in his Budget speech, and is at the same time so
indubitable, that to quote his words is to say all that can be said on
this point. "They (the trustees) have nothing to do with the money;
that is a mere question of investing it with which we are alone
concerned. If we lost every farthing of it, we should have to pay it
to them; and if we made a profitable investment of it, it would be
entirely our own affair." In one respect only is Mr. Gladstone's
proposal specially satisfactory to Savings Bank officials and all who
take an interest in Savings Banks. Under the operations described by
the Chancellor of the Exchequer in his Financial Statement, and now
familiar to every reader, the Balance estimated to be deficient, of
over three millions sterling--a deficiency which has long been a
bugbear in all considerations of the subject--will disappear as a
separate item in the National Accounts in the process of redemption
proposed. The entire scheme shows, especially and prominently, Mr.
Gladstone's anxiety to reduce our enormous burden of debt. He here
voluntarily proposes to cripple himself in no small degree in the
matter of his resources. Should his proposals become law--and it is
sincerely to be hoped they will--the process must go on, even when he
or his successors may require to raise money at an obvious
disadvantage; but if he be satisfied to throw the burden equally on
years of prosperity and adversity, surely this is a matter on which
the public generally should feel no fear.
CONTENTS.
PAGE
CHAPTER I.
INTRODUCTORY CHAPTER 1
CHAPTER II.
ON THE ORIGIN OF SAVINGS BANKS 18
CHAPTER III.
EARLY LEGISLATION OF SAVINGS BANKS--1817 TO 1844 45
CHAPTER IV.
ON THE PROGRESS OF SAVINGS BANKS UP TO THE YEAR 1844 80
CHAPTER V.
LEGISLATION ON SAVINGS BANKS FROM 1844 TO THE PRESENT TIME 122
CHAPTER VI.
A CHAPTER ON SAVINGS BANK FRAUDS 183
CHAPTER VII.
ON THE DEFICIENCIES OF THE EXISTING SYSTEM, AND THE
ESTABLISHMENT OF SUPPLEMENTARY SAVINGS BANKS 226
CHAPTER VIII.
ON PROPOSALS FOR GOVERNMENT SAVINGS BANKS 269
CHAPTER IX.
ON THE DEVELOPMENT OF THE POST OFFICE SAVINGS BANK SYSTEM 311
CHAPTER X.
ON GOVERNMENT INSURANCE AND GOVERNMENT LIFE ANNUITIES 345
CHAPTER XI.
CONCLUDING CHAPTER 377
APPENDIX 395
INDEX 437
HISTORY
OF
SAVINGS BANKS.
CHAPTER I.
INTRODUCTORY CHAPTER.
"Archimedes was wont to say that he would remove the world
out of its place, if he had elsewhere to set his foot, and
truly I believe so far that otherwise he could not do it.
I am sure that so much is evident in the architecture of
fortunes, in the raising of which the best art or
endeavour is able to do nothing, _if it have not where to
lay the first stone_."--SIR HENRY WOTTON.
The habit of laying something by in a prosperous season for the wants
of an adverse one is one of the very oldest customs in the world. All
our laws, Divine and human, enjoin the exercise of providence and
frugality as a social, and as a personal duty. These habits which are
inculcated in Scripture as positive duties, and which find ample
illustrations in many of the arrangements of nature and Providence,
have been common in one form or other to all people in every country
and in every age. In England, in almost everything relating to the
social advancement of the industrial population, there has been a
great and manifest improvement since the commencement of the present
century. In nothing is this more true than in the incentives and
appliances provided for the growth of provident habits amongst them.
An old stocking, a hole in the floor, or a crevice in the wall, was
formerly a sufficient bank for such of the poor as cared to save
anything; but were that mode of investment unsatisfactory to some few,
it was not possible to obtain better. The change which fifty years
have wrought in the means for saving and investing small sums of money
is remarkable. Not only have these savings assumed in consequence a
variety of different forms, but they represent a sum which in the
aggregate must be well calculated to astonish anyone who can remember
anything of the last century. Before dealing, however, with this as
our special subject, a few words may not be spent in vain in
endeavouring to trace the gradual advancement made among the poorer
classes, the causes that have led to the improvement in their
condition, and the means by which the difficulties in their position
have been encountered. After this it will not be inappropriate to
refer to what still remains to be done.
"The nineteenth century," as Mr. Gladstone, in addressing the working
men of Glasgow, has just said, "whatever else it is, is undoubtedly in
a new and peculiar sense the century of the working man." "It is the
century which has seen his position raised, his circumstances
improved, new means organised for his benefit, new prospects opened
for the future, and he has before him--I mean not the individual but
the class--a prospect which, I trust, nothing can mar--of increased
weight, increased consideration, increased usefulness, increased
happiness in the generations to come." The Chancellor of the Exchequer
might with justice have said that the second quarter of the present
century has seen this great improvement inaugurated and carried on.
Beginning with 1830, and letting the period of the removal of
political and fiscal burdens mark the commencement of the better order
of things, the progress of political economy, of social knowledge, and
the favouring circumstances of the times achieved the rest. In the
first quarter of the century the working population, left pretty much
to themselves, or given over to the tender mercies of political
demagogues, were either stolidly indifferent to any improvement, or
were kept in a constant turmoil of excitement and confusion. The
Reform Bill bringing political power to the better class of artisans,
gave a decided stimulus to the intelligence of the people, and an
impulse to the then existing means of education. This political power
brought its responsibilities, and it may be fairly assumed that
increased political knowledge was the result. Whether so much will be
granted or no, it is certain that schools and educational
establishments now began to multiply in a manner unknown to any
previous decade. It was now that there came demands for knowledge, and
that the demand brought forth supplies of the most practical kind. The
story of the popular literary ventures of 1832--the very first of
their kind--need not be repeated here, though a volume might well be
written on the subject, and showing the influence which they, and
other ventures to which they gave rise, have had on the intellectual
progress of the people. On the demand for knowledge there followed in
quick succession the removal of many barriers that stood in the way;
and more important still, the remissions of, to the poor man, enormous
fiscal burdens which pressed with great weight upon his energies.[1]
It would scarcely be too much to say that every year for the last
thirty years the working man has found himself better able to cope
with the disadvantages of his position, and, if he should so choose,
to place himself to a very great extent beyond the reach of absolute
want.
We have alluded to the necessity which began to be felt for the mental
improvement of the adult population; still more important were the
steps taken from time to time to educate the children who are the old
people and the adults of the present day. The present century, among
many wonderful changes which it has witnessed, has seen a complete
revolution in the means of education for the masses. Many generations
since, Milton, with that clear mental vision which was in him like a
kind of second sight, foretold that a time would come when the bulk of
the people would get a better education "in extent and comprehension
far more large, and yet of time far shorter, and of attainment far
more certain, than hath yet been in practice;" and although we may not
have exactly reached the point prefigured by the poet-seer, some
marvellous strides have been taken during the present century. A
dramatist of Milton's own period makes a man of substance reply, in
answer to the query, "Can you read and write then?" "As most of you
gentlemen do, my bond has been taken with my mark at it."[2] At the
beginning of the present century little had been done for the
education of the masses. Grammar schools for the children of the
middle classes, and Free schools, as they were called, for an
infinitesimal fraction of the poor of our towns had been long
established, and, so far as they went, with certain enough results;
but, if we except the establishment of Sunday schools by Mr. Raikes of
Gloucester in 1783, nothing had been done for the educational wants of
the general poor. Malthus in his "Essay on Population," published
twenty years after this date, says, "It is surely a great national
disgrace that the education of the lower classes should be left merely
to a few Sunday schools supported by subscriptions from individuals,"
adding at the same time, that the country "lavished immense sums on
the poor which we have every reason to think have constantly tended to
aggravate their misery." "In their education," he goes on to say, "and
_in the circulation of those important political truths that most
nearly concern them_, which are perhaps the only means in our power of
really raising their condition, and of making them happier men and
more peaceable subjects, we have been miserably deficient." What the
state neglected, private enterprise took up; earnest men like Raikes
and Pounds, the working shoemaker, not only set an admirable example
in their own spheres of labour, but roused to action other men who
applied to the work greater powers of mind and the benefits of greater
system. Dr. Bell and Mr. Lancaster were two of these, who nearly at
the same time expounded their views of a general scheme for educating
the people; and who were strengthened in their opinion, as one of them
tells us, of its necessity, by the clamour of many who held that the
stability of our institutions was only sure so long as the people were
kept in ignorance. Mr. Whitbread, a statesman whose name was very
prominent about this time for efforts to promote the interests of the
bulk of the people, tried to induce Parliament at this stage to take
the subject into its consideration, by proposing a plan for the
establishment of parochial schools "for the exaltation of the
character of the labourer," and it would have been well if he had met
with more success. As it was, the sage legislators of the day, led on
by Mr. Windham, considered that such a plan would be very liable to
give an education to these classes much above their condition, and Mr.
Whitbread's scheme, like many other of his wise proposals to which we
shall have subsequently to allude, was set aside. The work, however,
had begun and could not be stopped by the attitude of the government.
Dr. Bell commenced his system by the establishment of National
schools; Mr. Lancaster, supported by Nonconformists principally, set
up Lancasterian schools. Although there was for some time much
hostility displayed between the rival factions, both organizations
struck deep into the dense masses of ignorance in our towns and
villages. Then came Government assistance, and gradually that system
of Government education and supervision which, in spite of many
objections to it, has been an untold blessing to the land.
Within the last thirty years the wise legislation of the Government
has had a direct influence on the progress of the people in education,
and in their social well-being. No more powerful aid, for example, was
given towards the triumph of enlightenment than the passing, in 1839,
of the penny postage measure, when thousands of the poorer classes
became emulous of each other in learning the rudiments of education,
so as to be enabled to possess themselves of the untold advantages of
this wonderfully successful scheme. Mr. Laing, the celebrated
traveller, after visiting the Continent, declared that the system of
penny postage was far more likely to cause the spread of education
among the masses than the Prussian system of education, if it came to
be adopted in this country. Only second to the repeal of the taxes on
correspondence was that of the reduction of the newspaper stamp duty,
and, still more recently, the abolition of the paper duty. The
relinquishment of these taxes redounds to the honour of those who took
part in the agitation for their abolition, and who held that no
artificial impediment, such as a paltry consideration of revenue,
ought to stand between the people and the free circulation of thought.
Lord Brougham said on one occasion that, "if newspapers, instead of
being sold for sixpence, could be sold for a penny, there would
immediately follow the greatest possible improvement in the tone and
temper of the political information of the people." Lord Campbell once
expressed a hope that newspapers would be sold for a halfpenny. Much
of this has been realized, and the result has been powerful for good.
On this point no one can speak with anything like the authority of Mr.
Gladstone. Speaking of the repeal of the paper duty, this eloquent
statesman has said within the present year, "I did to the best of my
ability fight a hard battle for its repeal. And I find now that not
only in its repeal was there involved the liberation of a great branch
of trade, but there was involved a seed of social and moral good that
has sprung up with rapidity, producing a harvest such as, I confess, I
had hardly been sanguine enough to anticipate."[3] The cheap press now
finds its way into the homes of the poorest, keeps them informed of
the current public events, and makes them interested and anxious in
all that concerns their country and its institutions; and, inasmuch as
the press of the present day is, under proper conduct, well qualified
to enlarge the minds of those whom it must instruct, it is a "seed of
social and moral good" from which a constantly-increasing harvest of
good fruit may be obtained.
In view of such facts it cannot be said that, during the last quarter
of a century, the industrial classes have been entirely thrown on
their own resources for the means of their enjoyment and improvement.
Over and above the tendency of the legislation of the past thirty
years, the upper classes have felt it their duty, as it is
unquestionably their interest, to attend to the wants and requirements
of those at the bottom of the social scale. They are the safest when
the vast mass of our working population are the happiest. Dr. Chalmers
must have felt this when he wrote, "I would like to see a king upon
the throne, not like an unsupported may-pole among a level population,
but a king surrounded by a noble aristocracy and gradations below
them, shelving downwards to the lowest basis of the people." Society
has been very often and very truly likened to a pyramid, at the apex
of which is the throne; gradually descending, we have substantial
strata of the ruling, the upper, and the middle classes, the rough and
strong material at the base not inappropriately said to represent the
unpolished millions of our industrial population. How far it may be
considered true that the foundations of English society are laid in
this great class, and how much of the social superstructure they bear
on their broad shoulders, we will not attempt to decide. We will
content ourselves with saying that the well or ill-being of every man
forming this great social pyramid must have a direct or reflex
influence on every other man. _Homo sum, humani nihil a me alienum._
Of the hundreds of charitable and benevolent agencies set on foot to
improve the condition of the English artisan we can only speak in the
aggregate. We have the clearest evidence of our senses, that many of
them have not been established in vain. Some of them, indeed, have
been born and carried on under serious misapprehensions, fatal to
their existence, and so have perished without doing half the good
which the expenditure of money and time would have warranted. But this
is the exception and not the rule. Under the influence of properly
organised and properly conducted societies of this nature, which have
been quietly working for years, there is a sensible improvement in
public morals among the masses of the people. Within the memory of the
present generation lewdness, profanity, and vulgarity polluted the
atmosphere of most large workshops, and the effect of all this on the
minds of the younger portions of the workers must have been utterly
demoralizing. Then their hours of idleness were hours of mischief; in
them the old proverb of "an idle brain" being "the devil's workshop"
was fully exemplified; bull-baiting, cock-fighting, low drinking, and
gambling were their amusements; Sunday nor weekday did their children
frequent any school, nor they themselves any place of worship; they
made no provision for want, sickness, or death, and in times of
enforced idleness they were a terror and reproach to the country, only
kept in order by the strong arm of the law. To say that all this is
changed would be idle, but that much of it is changed is beyond doubt.
Even humble society now quickly lays its ban upon those who would
think "to rule the roast" by proficiency in vulgarity and profanity;
in our large workshops we are assured that acquirements of this nature
get less and less appreciation, nor do their exhibition often escape
rebuke. Under better and happier influences, many of the rules and
social regulations among large congregations of workmen, such as fines
and footings, which have always offered great encouragement to
idleness and intemperance, have either been done away with or altered
for good;[4] masters not only see it to be their interest to encourage
their men where they can in habits of sobriety and prudence, but they
are now often enabled to enforce regulations tending to this end which
before they were almost powerless to effect.[5]
The good results of such habits to the industrial classes themselves
and to all portions of society are neither few nor doubtful. The
pursuit of economy and thrift will beget, as a matter of course,
self-dependence; and as soon as men become socially independent they
also become self-relying and self-supplying. "Few men come to the
parish who have ever saved money," said one large employer of labour
before a Committee of the House of Commons on Poor Laws. Another never
knew a man who had saved a pound out of his earnings who had in the
end become a pauper. But the good work does not stop here. "In
proportion as our men save money," said another large employer, "their
morals are improved; then they come to see that they have a stake in
the country, and behave better." Or, as Vegetius, describing the Roman
soldier, puts it, "knowing that his property is deposited with the
standards in the public chest, he never thinks of desertion, becomes
attached to his standards, and in battle fights more bravely for them;
according to the nature of man, who has always his heart where his
treasure is." Arrived at this stage of the upward journey, the
provident man feels the need of education, and must have it; he must
also take a part in exerting an influence among his fellows, and even
in the government of the country, and if his reading takes a
rigid-turn, higher principles of duty are superadded; he will do his
work, whatever it is, in every sense better. "I would rather have,"
said another well-known gentleman, to the Committee just referred to,
"a hundred men in my employ who save money than two hundred who spend
every shilling they get; the sober, saving man is always to be
depended upon, and the one lot in the long run will almost do as much
work as the other."
The improvement of which we have been speaking must not blind us,
however, to the darker side of the picture. Notwithstanding the
improvement which has been made, and the inestimable good which flows
from the practice and pursuit of frugality and economy, it is still
the exception and not the rule among the bulk of our labouring
population. For the hundreds who look to the exigencies of their life,
there are thousands who are utterly careless of such considerations,
and who, in the coarse enjoyment of the present, bury alike all
thought of the past and all expectation of and hope for the future.
The stigma of improvidence has long attached, and we fear must yet
long attach, itself to the generality of English artisans. But for
this stigma there would be no operatives in the world equal to the
English operative either in wealth, intelligence, or influence. No one
with any experience in the case, and with any care as to accuracy,
would venture to say that the English workman, _sui generis_, is not
industrious at his work,[6] but too many can say that he is not
provident in his home.[7] The English artisan has been said to be at
once the hardest worker and the hardest spender in the world. He works
like a horse and spends like an ass. So foolishly, indeed, is much of
this hard-earned money spent, or misspent, that it were a charity to
withhold it, or if it could be done, to throw it into the sea. The
consequences attending this riot of expenditure is as natural and as
inevitable as any of the laws of God's government. As one who knows
them well, and one who has done much for the intellectual culture of
the better portion of the artisan class tells us: "In a time of
prosperity they feast; in a time of adversity they _clem_." Any
depression of trade, be it even of the most transient nature, finds
them totally unprepared for it; those who have been accustomed to the
best wages invariably suffer the most; for, accustomed to the greatest
amount of indulgences, they can do worst without it. It is such
classes as these that must be reached by some means. In the
improvement brought about in the social habits of the people of late
years we have a happy augury of the future.[8]
It is time that we brought these introductory remarks to a close. We
have to enter upon the consideration of helps and accessories to the
spread of prudential habits among the working classes. We have to
direct attention to the history and working of some of those schemes
which, since the commencement of the present century, have been
started to teach men self-reliance and self-dependence, and how they
might best help themselves. Anxious not to over-estimate the
importance of the subject, we still think it not too much to say that
on our industrial classes depends very much the continued and onward
progress of the world. Let them but be thoughtful and sober, and these
classes, which are the direct agents in our wondrous and manifold
British industry, will, not only under circumstances of huge toil and
no inconsiderable danger, continue to provide all classes with the
necessaries or comforts of life, but they will yet strike out new
paths; they will become, in the future, as they have been in the past,
the skilful inventors of new instruments and new modes. No fact is
more capable of proof than that almost all the successful inventions
that have been given to the world to economize the strength of the
human hand have been either the productions of thoughtful and
industrious workmen, or of those who have risen from that class.
"Deduct all," says Mr. Helps, "that men of the humbler classes have
done for England in the way of inventions only, and see where she
would have been but for them." Nor is this all. The list would be a
long one of those who have risen by their own industry and
perseverance from the lowest ranks to fill the highest positions in
every department of life. "It is notorious," says Mr. Smiles, "that
many of our most successful employers, and some of our largest
capitalists, have sprung directly from the working classes, and to use
the ordinary phrase, have been 'the architects of their own fortunes;'
whilst many more have risen from a rank scarcely a degree above them.
It was the prudent thrift and careful accumulations of working-men
that laid the foundations of the vast capital of the middle class; and
it is this capital, combined with the skilled and energetic industry
of all ranks, which renders England, in the quantity and quality of
her work, superior to any other nation in the world."[9] And what the
humbler classes have done for England in past times they may do, and
indeed _must_ do in the future, if we would keep our country in the
proud position she now occupies in the world. It requires no prophetic
vision to foresee that labour must yet undergo many transformations;
and it is of paramount importance that the labourers themselves be not
only intelligent but sober and frugal, in order that they may always
compete on at least equal terms with the skilled workmen of any other
nation.
It is far more difficult to point out what course of action will tend
most successfully to secure the fair results of sobriety and frugality
than it is to show how necessary it is that these virtues should be
cultivated. "The difficulty of doing good," as one writer expresses
it, "is at least equal to its luxury." The task we have undertaken is
far from easy, and beset with perils, but we will endeavour to avoid
all occasion of dispute. The pointing out of safe and profitable
investments for the hard-earned savings of the frugal and industrious
need not and should not be regarded as an invidious task. It seems to
us that, as Savings Banks have to do primarily with the foundation of
the habit of saving money, and indeed scarcely ever can be considered
as competing with any of the numerous schemes for the investing of
money, the subject should never be regarded with any jealous feeling.
The principle upon which these institutions are founded "interferes,"
to use the words of one who has written most ably on such subjects,
"with no individual action, saps no individual self-reliance." "It
prolongs childhood by no proffered leading-string; it valitudinarises
energy by no hedges or walls of defence, no fetters of well-meant
paternal restriction. It encourages virtue and forethought by no
artificial excitements, but simply by providing that they shall not be
debarred from full fructification, nor defrauded of their natural
reward. It does not attempt to foster the infant habit of saving by
the unnatural addition of a penny to every penny laid by; it contents
itself with endeavouring to secure to the poor and inexperienced that
safe investment and that reasonable return for their small economies
which is their just and scanty due."[10] Strengthened by such
testimony, we will proceed at once to sketch the history, and, as far
as we are able, to show the benefits to be derived from the various
kinds of banks for savings established from time to time amongst us.
[1] The following table taken from the _Statistical Returns_,
presented by the Board of Trade, shows in a clear light how much
of the position of the working classes must have been improved by
the removal of fiscal burdens. Almost all the impositions of
taxation between 1850 and 1864 have fallen upon the wealthier
classes:--
+------------------------+------------+-----------+-------------+
| |Repealed or | |Diminution or|
| | Reduced. | Imposed. | Addition. |
+------------------------+------------+-----------+-------------+
| | £ | £ | £ |
|Customs | 12,208,604 | 3,291,820 |D. 8,916,784|
| | | | |
|Excise | 5,607,000 | 6,380,000 |A. 773,000|
| | | | |
|Property and Income Tax | 16,265,000 |14,764,000 |D. 1,501,000|
| | | | |
|Other taxes | 2,608,800 | 600,000 |D. 2,008,800|
| | | | |
|Stamps (including | 1,428,000 | 2,411,200 |A. 983,000|
| succession duty) | | | |
+------------------------+------------+-----------+-------------+
| Total |£38,117,404 |27,447,020 |D. 10,670,384|
+------------------------+------------+-----------+-------------+
[2] In 1846, according to the Report of the Registrar General for
that year, out of the persons married in that year, one man out of
three, and one woman in two, signed the register with marks. What
was being done for the children of that year may be gathered from
the return for 1864, where it is shown that only eighteen in 100
of those marrying in that year were unable to write their names.
[3] Speech at Newton-le-willows, July 22, 1865.
[4] By way of giving an example of our meaning, we would adduce
the case of the workmen employed in the large brass works of
Messrs. Guest and Chrimes, Rotherham. When one of their number,
for instance, gets married, instead of the accustomed
hard-drinking, the men and their wives drink tea together, and a
piece of furniture of substantial value is presented to the
newly-married pair, paid for out of the subscriptions by the men.
On one of these occasions it is related, that the head of the firm
was asked to present articles which had been bought for two
newly-married couples, and Mr. Guest complied and introduced the
business as follows: "The custom you have adopted deserves the
warmest commendation and support, and is well worthy of
superseding those footings, fines, treats, &c., which, until
recently, had become a source of the most cruel, heartless, and
unjust robbery to which workmen could possibly be exposed by each
other. Thank God that wicked system is fast passing away."
[5] In 1851-2 a large and well-known engineering firm in Leeds had
a serious struggle with their workmen on account of the masters
having determined to pay the men according to their merit and the
character of the work turned out. A determined strike was the
result, which, though the original difference was only with eight
men, threw eventually more than 600 out of employment. Fresh hands
were obtained with the usual difficulty, and these were subjected
to great annoyance and even danger; in eighteen months, however,
the works were again all going and were efficiently manned. The
masters henceforth made it a condition of employment under them
that no member of a trades' union should be engaged, and the
sequel was a better behaved and superior class of men. Not only
so, but the masters are now enabled to make their own regulations
for the benefit of those employed under them, which before, owing
to the interference of the trades society, they could not make.
They have instituted a sick and funeral fund to which the men
contribute by working _ten minutes additional time when
necessary_, an arrangement which we recommend to other large
employers of labour and large bodies of workmen. That the masters
should be acquitted of any selfish motive, they allow the funds to
be managed and applied by a committee of workmen appointed by
themselves from their own number.
[6] "No labourer," says Mr. Smiles in his _Workman's Earnings,
&c._, "is better worthy of his hire than the English one. It is
not merely that he works harder than the labourer of any other
country, but he generally produces a better quality of workmanship.
He possesses a power of throwing himself bodily into his
occupation, which has always been a marvel to foreigners;" and he
then recurs to the well-known example of the surprise created
among the French peasantry when gangs of English navvies proceeded
with the works of the Rouen railway, and worked amidst constant
exclamations, of "Voilà! voilà ces Anglais! somme ils travaillent!"
[7] We put the matter quite mildly here, though it is customarily
and very properly spoken of much more severely. For example, Mr.
Norris, one of the Government inspectors of schools, in speaking
of the well-paid miners and iron workers of Staffordshire--who
doubtless are little worse than the same classes throughout the
country--says in one of his able reports: "Improvidence is too
tame a word for it--it is recklessness; here young and old,
married and single, are uniformly and almost avowedly
self-indulgent spendthrifts. One sees this reckless character
marring and vitiating the nobler traits of their nature. Their
gallantry in the face of danger is akin to foolhardiness; their
power of intense labour is seldom exerted except to compensate for
time lost in idleness and revelry; their readiness to make
"gatherings" for their sick and married comrades seems only to
obviate the necessity of previous savings," &c.
[8] Much of what we have said in the foregoing pages is admirably
summed up in a sentence or two in an article on "Savings Banks,"
which we would not be far wrong in attributing to Dr. Wynter, and
which we had not seen before these pages were written:
"Contemporaneously with the growth of savings banks, we have seen
a growth of civilization among the poorer classes. Thrift has not
effected _all_ that amelioration of morals which contrasts so
happily the mid years of the century with its younger ones; but it
has been no mean confluent to the tide of progress, the softening
of manners, the spread of education, the humanising of popular
sports and pastimes, the wakening up of the natural dignity and
self-reliance of the people,--the broad and indispensable basis of
every other virtue."--_London Review._
[9] _Quarterly Review_, 1859.
[10] Mr. W. R. Greg in the _Edinburgh Review_, 1853, p. 406.
CHAPTER II.
ON THE ORIGIN OF SAVINGS BANKS.
"It would be difficult, we fear, to convince either the
people or their rulers that the spread of Savings Banks is
of far more importance, and far more likely to increase
the happiness and even the greatness of the nation, than
the most brilliant success of its arms, or the most
stupendous improvements of its trade or its agriculture.
And yet we are persuaded that it is so."--_Edinburgh
Review_, 1818.
Great Britain can with justice, we think, lay claim to the original
establishment of the system of Savings Banks. One well-known
writer[11] on this and cognate subjects has traced them to
Switzerland, if not to Hamburg, at a time prior to any experiments
with them in this country; but from the best investigation we have
been able to make, the institutions in question were something very
different from Savings Banks as English people understand them,
dealing, as they did, in business more like the sale of deferred
annuities. The institution at Hamburg, which is said to have been
founded in the year 1778,--and which is interesting to readers of
history as being one of those whose coffers the First Napoleon swept
of their funds, thus giving it its death blow,--simply took the spare
cash of domestic servants and handicraftsmen, and granted annuities on
the members arriving at a certain age. No withdrawal of money was
allowed. In this country the first proposals for a bank for savings
were made in 1798 or 1799, according to the judgment of the reader as
to which of the two original schemes best deserves the name of Savings
Bank, or whether either of them is entitled to the honour. The two
persons whose names it is customary to speak of in connexion with the
earliest people's banks are those of the well-known Priscilla
Wakefield, and the Rev. Joseph Smith of Wendover. In the mind of each
of these estimable persons we think the question of becoming the
bankers for the poor around them was at first only a subordinate
measure, and quite auxiliary to other matters deemed of greater
importance. Mrs. Wakefield's scheme arose out of a well-meant anxiety
to better the condition of the weaker and more defenceless portions of
the community, an object to which she devoted much of her literary
ability, and was first started in 1799, for the benefit of women and
children in her own village of Tottenham, and under her immediate
superintendence. Members paying according to their age certain sums
per month became entitled to a pension after sixty years of age; in
case of sickness, four shillings a week; in case of extraordinary
misfortune a certain amount could be withdrawn; in case of death a sum
of money was allowed for the funeral. Honorary members paid
subscriptions, which went to meet deficiencies and current expenses.
In 1801 there was added, first, a fund from which loans were made to
those who had been members for six months; and second, a regular bank
for savings. The interest given in the latter case was the same as
that charged in the former, or five per cent. The clauses relating to
children were such as almost to entitle the founders to the honour of
being the originators of Penny Banks, if nothing else; juveniles were
encouraged to deposit their penny per month, which was kept for them,
along with interest, until such a time as the accumulation was needed
for apprentice fee, clothes, or such like object. The management of
this Parent Institution, as it may well be called, was equitably
divided amongst the honorary and the "benefited" members. In 1804 the
Tottenham Bank was more regularly organized, and Mr. Eardley Wilmot,
M.P. and Mr. Spurling, were appointed Trustees.[12]
The Wendover institution, which was really started a year before that
at Tottenham, partook at first so largely of the nature of a charity
as to make it almost of the character of a private undertaking between
a rich and benevolent rector and his poor parishioners. Still, there
was here the germ of that of which we are in search. Mr. Smith, and
two of his richer parishioners, who joined him in the work, circulated
proposals in the summer of 1798 to receive any surplus money which any
of the working population round them felt they could spare--provided
it were not less in amount than twopence; to keep a strict account of
every deposit made in this way; and then to repay the money during the
winter season, or generally about Christmas, with the addition of one
third of the whole, which would be allowed as interest on their
deposits--or to speak, perhaps, more correctly, as a bounty for their
economy. Any depositor might receive his money before Christmas on
demand; and it was further stipulated that, in case of sickness or
loss of employment, these fruits of his savings should not preclude
him from parish relief, if otherwise he could obtain it. A Christmas
dinner was the comfortable addition to the good round sum which,
generally, was garnered at this time, the dinner, too, being provided
by the three directors. It is rather curious that the time chosen to
receive deposits was limited to Sunday evenings; but we suppose this
would be justified by the scriptural text, not generally applied in
this fashion, which they chose for their motto, "Upon the first day of
the week, let every one of you lay by him in store, as God hath
prospered him." For several years these benevolent gentlemen carried
on their operations, and had generally about sixty subscribers, who
deposited from five to ten pounds every season.
In February, 1807, Mr. Whitbread introduced his Poor Laws Amendment
Bill into the House of Commons, and went over the whole ground of the
condition and the wants and requirements of the working population in
an eloquent manner. That speech--which must have been of several
hours' duration--dealt with the past legislation on the subject, and
commented on the various steps which ought to be taken, over and above
the mere collection of poor-rates, to alleviate the condition of the
poor. After dwelling on the subject of national education, and hinting
at a mode such as was eventually brought into operation many years
afterwards, Mr. Whitbread went on to describe the want felt by the
poor of some safe and profitable investment for their earnings; "that
so few are found to make any saving may in a great degree be accounted
for by the difficulty of putting out the little they can raise at a
time." He described the action of Friendly Societies, and showed that
at that early period they were open to the same objections that are
now being continually raised against them. "Mr. Malthus,"[13] said Mr.
Whitbread, "had just proposed the establishment of county banks, but
he would go farther than Mr. Malthus, and extend his principle." It
seemed to him that there would be less trouble in his proposals than
in the less extensive proposals of Mr. Malthus.
Mr. Whitbread then went into the matter of his proposals under this
head, and we give his own words:[14] "I beg gentlemen not to start at
what I am about to suggest, which to many who hear me may be quite
new, but to afford it their cool and deliberate consideration. I would
propose the establishment of one great national institution, in the
nature of a bank, for the use and advantage of the labouring classes
alone; that it should be placed in the metropolis, and be under the
control and management of proper persons; that every man who shall be
certified by one Justice of the Peace to subsist on the wages of his
own labour shall be at liberty to remit to the Accountant of the
Poor's Fund (as I would designate it) any sum from 20_s._ upwards, but
not exceeding 20_l._ in any one year, and not more than 200_l._ in the
whole." He then proceeded to show how the money might be invested in
Government Stock, in the name of commissioners to be appointed, and by
this means interest would be allowed to depositors at the highest rate
possible. "The plan," added Mr. Whitbread, "will be more amply
detailed in the Bill itself, and such regulations are provided as
will, _with the intervention of the Post-office_, give ample
facilities to its execution. Gentlemen need not to be told that the
perfection attained in the management of that great machine is such as
to give the most easy and rapid means of communication with the
metropolis, much greater, indeed, than usually subsists between the
remote parts of any county and its capital town." Mr. Whitbread then
went on to say, that in addition to this form of investment, the same
machinery might be employed to give those who might wish it an
opportunity of purchasing annuities by the payment of stated regular
sums up to a certain age; and even to insure their lives. So strong,
indeed, was this feeling, that he eventually proposed, as an addition
to his bill, that under the same management there should be an
Insurance-office for the poor, with properly-calculated tables and
modes of payment. We need not here dwell upon the miscellaneous items
which he fully went into in his admirable speech. He finally begged
the patient attention of the House and the country to the
consideration of the general outline of the plan which he had
proposed, in order to encourage the labourer to acquire property, and
to secure to them the certain and profitable possession of it when
acquired. He had the greatest hope of a happy effect from its being
put in practice. "If the poor," said he, "should be found to avail
themselves of it to any extent, the advantage to them and the country
would be incalculable, and the expense attending it would speedily be
covered." This Bill went through several necessary stages; there was
little objection manifested to Mr. Whitbread's plans for securing the
savings of the poor, but there was also little anxiety to forward the
measure. Mr. Whitbread in this, as in many others of his wise
proposals, was far ahead of his time, and he suffered the matter to
drop towards the end of the session.[15]
One at least of the important organs of public opinion frowned upon
Mr. Whitbread, and laughed at his scheme; an organ whose frown and
whose laugh was no joke at that date. It has not unfrequently been a
subject of remark how persistently the _Quarterly Review_ stood in the
way of progress, clogging the wheels of all kinds of reform. In
matters of this kind, however, it generally showed a most enlightened
policy, and was not unfrequently in the van of improvement instead of
obstruction. It was not so always with its more powerful rival, the
_Edinburgh Review_. It commented upon Mr. Whitbread's "strange
project" of uniting the savings banks throughout the kingdom in one
national establishment, and his minor proposals under that head, and
very warmly ridiculed all. "Neither from theory nor from experience,"
it concludes an article, "are we able to discover any kind or degree
of good as likely to result from so vast a project; though it is easy
to see that it might be productive of infinite confusion, trouble, and
expense. In fact, every savings bank is perfectly competent in itself
to transact the whole of its affairs, and can have no great difficulty
to provide the requisite facilities or securities without either
disturbing its neighbours, or withdrawing the attention of Government
or the Legislature _from their proper concerns_."
Before we come to the plans and exertions of Mr., afterwards Dr. Henry
Duncan, of Ruthwell, we ought to speak of the original foundation of
the savings bank at Bath. The idea of establishing a bank for taking
the wages of industrious domestic servants only, and granting them
interest for their money, originated with Lady Isabella Douglas in
1808. The managers consisted of four ladies and four gentlemen. No
servant could deposit more than 50_l._, and the entire amount of the
funds in the bank could never exceed 2,000_l._ A servant might deposit
up to 50_l._, withdraw the money and place it in safety, and deposit
again in the servants' bank. Interest was allowed at four per cent.,
and the money could be withdrawn at will. This scheme, so far as it
proceeded, was very successful; so much so, that an endeavour was made
in 1813 to convert it into a general savings bank, which should know
no limit, either in the amount of the deposits or in the class of
people from whom the deposits could be taken. For this purpose a
committee, "highly respectable for their rank, ability, and
benevolence," met frequently at Bath; but only to find, "after much
deliberation," that these conditions "were utterly impracticable."[16]
In 1815, the Provident Institution of Bath was projected, on very
different conditions; and this time, through the exertions of Dr.
Haygarth and the Marquis of Lansdowne, who was president, the bank was
successfully floated. This bank was essentially the first of its kind
in this country, and upon its basis have been formed almost all
subsequent banks of any note. The sums deposited were invested in the
public Funds, and each man's interest at this early period varied
according to the price of the Funds on the day when the investment was
made for him.
In November, 1815, the Provident Institution of Southampton was
established, principally through the exertions of the Right Hon.
George Rose, who was appointed president, and who soon afterwards
wrote an account of the undertaking.[17] The exertions of Mr. Rose on
behalf of savings banks will frequently require to be spoken of in
subsequent pages. The Southampton Bank was an improvement on the Bath
institution, having copied several of the details of the bank at
Edinburgh. The average rate of interest given was four per cent.
Notice had to be given for withdrawing deposits. One regulation, new
at that period, which was a suggestion of Mr. Rose, empowered the
officiating clergyman or other responsible person, in adjacent
parishes, to receive sums "on account of the institution," and remit
them to the treasurer at Southampton. It was stipulated, however--and
this had an ill effect upon the public, though the proviso was by no
means unreasonable in itself--that the institution should not be
answerable for the money until it absolutely reached the office. We
will here refer to two other original English savings banks, quite
equal in importance to those of Bath or Southampton. The Exeter
Savings Bank, since better known as the Exeter and Devon Bank, was
established in 1816, principally through the exertions of Sir John
Acland, one of the county members. The rules of this bank limited the
amount which could be deposited to 50_l._ in the first and second
years, and 25_l._ in any succeeding year. The distinguishing feature
about the Exeter bank was the application, attended with much greater
success, of the Southampton plan of rural or branch banks. In 1817,
there were sixty of these branch banks, all contributing sums to the
parent bank through village clergymen, who acted as the agents. The
plan only entailed a trifling expense for printing, postage, &c., and
even these expenses were paid out of a fund raised by voluntary
contributions. At the date of the first enactment relating to savings
banks, this bank had 946 depositors, who had paid in 14,525_l._ in
1,380 deposits. The interest given was at the rate of four per cent.
Within the two years of which we have spoken, only 984_l._, or about a
fifteenth-part of the deposits, were paid as withdrawals.
The original Hertford Savings Bank was a charitable concern, after the
fashion of Mr. Smith's at Wendover. "The Sunday Bank," as it was
called, was established about the year 1808, by the vicar of the
place, the Rev. Thomas Lloyd. Sums of from sixpence to two shillings
were received by the benevolent pastor from his poorer parishioners
after morning service on Sundays, and in this way about 300_l._ a year
was invested between 1808 and 1816. The money did not accumulate from
year to year, but was repaid on New Year's day, with the addition of
_ten_ per cent. interest, which the vicar was able to give by the help
of some charitable funds at his disposal.
We must now, without referring to other early banks, such as the
important institution in St. Martin's Place, London, and other
societies, turn to Dr. Duncan, whose exertions on behalf of savings
banks were much greater than those of any other person, and which
exertions, more than any original suggestions which he may have made
with regard to them, entitle him to the foremost place in any history
of savings banks. Dr. Duncan's claim to be considered the founder of
savings banks rests on the ground of his having originated and
organized the first self-sustaining bank, and in having succeeded in
so arranging his scheme as to make it applicable not to one locality
only, but to the country generally.[18] It remains to be seen whether
the bank established by Dr. Duncan in his own village answers the
description here given of the distinctive character attaching to the
banks of his proposing. It is very true that all the banks established
up to 1810 partook very much of the character of eleemosynary
institutions, supported in great part by the benevolence of the rich,
and therefore very unsuitable to some localities, where the benevolent
rich did not preponderate. Dr. Duncan's great merit--merit for which
he has received neither enough credit nor praise, but which should
entitle him to a high place in the ranks of those who have sought to
do their fellow-men good service--seems to us to lie in having deeply
studied the nature and wants of the industrial classes; in having
modified existing proposals in order to make them suitable to the
general requirements; and, finally, in having laboured with
unremitting energy to make his plans known around him, and to secure
their general adoption. A writer in the _Quarterly Review_ of October,
1816, incidentally referring to Dr. Duncan and his proposals for
parish banks, says, "It is our belief, founded on no slight
investigation, that but for this Scotch clergyman, there would at this
time have been found only a few insulated establishments for the
savings of industry, of which the intelligent and wealthy would have
had little knowledge, and from which the lower classes in general
would have derived no advantage."
Henry Duncan, who was the son of a Dumfriesshire clergyman, was born
at Lochrutton manse, in that county, in the year 1774. At the age of
twenty-five he too was ordained a clergyman, and appointed to the
charge of the parish of Ruthwell, a remote locality in the same
county. When very young, it is said, he showed remarkable powers of
mind; and it appears he early exercised them in writing for the young,
with whom he was an especial favourite. Before he was thirty he had
made great progress in geology, and a book he published on the subject
when he was about that age gained him the friendship of Dr. Buckland
and Mr. Sedgwick. Perhaps, however, he showed most zeal during all the
periods of his life in the prosecution of schemes for the benefit of
the poor and distressed around him; and his manse in this way, lonely
as it was, and far from the busy haunts of men, soon became a place of
resort to much of the young and remarkable talent to be found in that
part of Scotland. David Brewster, and James Grahame, the Sabbath bard,
Dr. Chalmers, and Dr. Andrew Johnson, were frequent visitors beneath
his roof; Robert Owen, then an amiable enthusiast in the walks of
philanthropy; Thomas Carlyle, a young man who had not then emerged to
fame; Robert McCheyne, and many others who subsequently rose to
eminence, were friends of the village pastor, and frequently met to
talk over with him different schemes of practical benevolence. "Few,
indeed," says his biographer, "whose lot has been cast in a retired
spot like that of Ruthwell, have been more fortunate in attaching the
affection and good-will of so many of the best class of their fellow
men," and the boast is neither an idle nor a vain one. Mr. Duncan must
have been no ordinary man to have brought round him such a circle of
friends. His literary abilities were of no mean order, but gave a
charm to all he wrote. Delighting in humble usefulness, he edited, in
1809 and 1810, a number of Tracts for the instruction and moral
improvement of "the lower orders," to use the vulgar term then in
constant use. The greater part of the work seems to have been the
production of his own pen. One series of these Tracts, called "The
Cottage Fireside; or, The Parish Schoolmaster," was afterwards
published separately with Duncan's name attached, and had a very large
sale at the time. "In point of genuine humour and pathos," says a high
authority of that period,[19] "we are inclined to think it fairly
merits a place by the side of 'The Cottagers of Glenburnie;' while the
knowledge it displays of Scottish manners and character is more
correct and more profound." Whether the plans which he laid for the
benefit of the poor, and which occupied so much of his after life,
came up at any of the _réunions_ at his house, we have no means of
knowing. However it was, we have Mr. Duncan's own statements to show
that they were originated in his mind by the frequent discussion at
that time of the question of poor-rates, and the endeavours on the
part of many of his friends to prevent their introduction into
Scotland. It is also clear, that though Mr. Whitbread's name is never
mentioned, the parish minister had heard of his scheme, and had been
much struck with it. The result of Mr. Duncan's reflections on the
subject were given in the _Dumfries Courier_, with which paper he
seems to have had some literary connexion. A discussion ensued in the
columns of this paper, in the course of which some books and pamphlets
on cognate subjects were forwarded to Mr. Duncan by Mr. Erskine,
afterwards Earl of Mar. Among the pamphlets he found a very curious
and ingenious paper by John Bone, the originator of a charitable
institution in London, the plan of which was there sketched. The
Society was called by the whimsical title of "Tranquillity, or an
institution for encouraging and enabling industrious and prudent
individuals to provide for themselves, and thus effecting the gradual
abolition of the Poor's Rate." This pamphlet, which we have carefully
examined, contains, among much matter of a visionary and impractical
kind, many proposals for the safe keeping of the savings of the poor
similar to those acted upon in the case of the charitable bank at
Tottenham. These subordinate provisions attracted the notice of Mr.
Duncan, as he himself admits, and he thought that if he could in any
way reduce them to a regular scheme, the result would be beneficial to
the working classes, wherever they might be adopted. He resolved to
form some such scheme and give it a fair trial in his own parish,
when, if successful, he would endeavour to get it introduced
elsewhere. With this object he published a paper, as a sequel to the
discussion he had commenced in its pages, in the _Dumfries Courier_,
in which paper he directly proposed to the gentlemen of the county the
establishment of a Bank for Savings in all the different parishes of
the district. "The only way," said Mr. Duncan in making these
proposals, "it appears to me, by which the higher ranks can give aid
to the lower in their temporal concerns, without running the risk of
aiding them to their ruin, is by affording every possible
encouragement to industry and virtue; by inducing them to provide for
their _own_ support and comfort; by cherishing in them that spirit of
independence which is the parent of so many virtues; and by
judiciously rewarding extraordinary efforts of economy, and
extraordinary instances of good conduct. Friendly Societies, excellent
as they are in their way, do not in every respect appear to be
calculated for this intended effect; advantages are held out which
cannot always be realized, but in simple Parish Banks there can be no
objection of this sort." Mr. Duncan met with little response to his
appeals from the gentlemen of the neighbourhood, but he resolved to
make the attempt single-handed. The fact that an institution of the
kind contemplated could possibly be carried out by a single
individual, however benevolently disposed, is evidence enough of that
person's sagacity and perseverance; but the ordinary difficulties were
greatly increased by the circumstances in which this particular parish
where Mr. Duncan was located was placed. Few parishes, we are told,
presented so many and such unusual obstacles to the progress of a
scheme of this kind. Almost every adult member of the parish belonged
to some Friendly society, and many of these found it extremely
difficult to fulfil their engagements to the established societies.
Again, there were few, if any, resident heritors or proprietors of the
land to whom Mr. Duncan could look in any difficulty that might arise,
or to whom he could look for any assistance of a pecuniary kind.
Nevertheless, he resolved to commence. He had arrived at that
experience of human kind which made him understand that, in even the
poorest family, "there are odds and ends of income which are only too
likely to get frittered away in thoughtless extravagance." Could he
but induce the mass of the people to comprehend the value of the
savings which might by a reasonable economy be gathered from this
source alone, and could he succeed in supplying the means of investing
these savings securely, affording them at the same time the prospect
of a fair rate of interest, not from charity, but from the resources
of trade, he was confident the hopes he cherished would be
realized.[20] The scheme was started in May, 1810, and savings to the
amount of 151_l._ were deposited under the stipulated conditions
during the first year. In the two succeeding years they rose to
176_l._ 241_l._ and in 1814 to 922_l._
Mr. Duncan's work was far from completed when even his most sanguine
expectations were realized in the progress of the Ruthwell Bank. His
advice and assistance was now continually sought in aid of the
formation of similar institutions, both in Scotland and England. In
1813, "the Edinburgh Society for the Suppression of Beggars" conceived
the idea of adding to their already extensive operations a Savings
Bank on some similar principle to his. A neighbour of Mr. Duncan's,
who was also a member of the Edinburgh society, communicated a full
account of the Ruthwell Bank, and all the accounts of it which had up
to that time been published. The opening of the Edinburgh Bank, of
which we shall presently speak more at length, took place in 1814. In
1814, Mr. Duncan paid a long promised visit to Kelso, in order to
forward the proposals for a Savings Bank at that place. Mr. Duncan
relates[21] that during his journey to Kelso he passed through the
town of Hawick, and was much gratified to find that his scheme was
freely talked of there. In the shop of one of the booksellers of the
town he found a large number of copies of an account of the Ruthwell
Bank wet from the press, which had been taken from the pages of the
_Dumfries Courier_ and supplied by himself. These handbills, which
likewise gave a copy of the Rules of the Parish Bank, had been printed
by order of the magistrates of the county at their ordinary meeting.
Finding that his scheme had many favourers in Hawick, he promised to
call on his journey home and assist them in the formation of a bank.
On his arrival at Kelso an important meeting was held, with the Duke
of Roxburgh in the chair, when Mr. Duncan addressed the meeting; the
Kelso Savings Bank, one of the most important of the Scotch
institutions, being the direct result. The number of letters which Mr.
Duncan received and wrote per day is described as something enormous;
they arrived by every post, not only from his own and the sister
country, but even from Ireland. Not only did these letters contain
requests for information and advice; but they frequently were of a
controversial nature, and generally from such people, ardent friends
of the poor, as required consideration and some reply. That Duncan was
an agreeable and clever correspondent is evident from his published
letters; that this correspondence was voluminous we can well believe.
With a view of lessening the amount of his labours in this respect, he
was induced to publish a full account of his scheme, together with all
the rules and regulations for its working; and this pamphlet, which
came out in 1814, went through three editions very rapidly. Even at
this date Duncan's "Essay on the Nature and Advantages of Parish
Banks" will well repay perusal, and besides, its intrinsic worth as a
literary production is interesting as the first published pamphlet on
a subject which will always possess attractions to the philanthropist,
if to none else. We have the clearest evidence that Mr. Duncan
laboured with uncommon zeal to spread a knowledge of the plans he
proposed, and to help to their general introduction; and it is a
matter of wonder to us, that, whilst many names are familiar to the
world who did not do a tithe of the real hard work he did to benefit
the poor around him, Duncan's name should be for all essential
purposes really unknown, and that but for the filial regard of his
son, scarcely an account of his existence should have survived
him.[22] Speaking during his life time, the _Quarterly Review_ warmly
noticed his labours of love: "Justice leads us to say that we have
seldom heard of a private individual in a retired sphere, with
numerous avocations and a narrow income, who has sacrificed so much
ease, expense, and time, for an object purely disinterested, as Mr.
Duncan has done." Some years before his death, in 1846, Mr. Duncan
attained to the honorary degree of Doctor of Divinity, and he was for
one year chosen Moderator of the Assembly of the church to which he
belonged. The Duncan Institution at Dumfries, one of the few mementos
of the man who did so much for Savings Banks, serves the purposes of a
Savings Bank in the principal town of his native county, a statue of
Dr. Duncan being very appropriately placed in front of it.
Not long after the establishment of the Edinburgh Savings Bank, there
was great contention as to whether that bank or Dr. Duncan's at
Ruthwell had the priority of merit on the score of general advantage.
Pamphlets were written on the subject, not always without bitterness,
and even the great _Reviews_ interfered. The dispute was scarcely
called for at that early period, seeing that posterity is best able to
judge of such matters, and there was nothing dependent upon an earlier
settlement. The Edinburgh bank followed the village bank by three and
a half years, so it was not a claim for priority of establishment. The
question as to which of the two possessed the materials best fitting
it to be a model for all subsequent banks would not be so easily
settled; and, in fact, this was the point in dispute. Seeing the
question was one of considerable importance for many years, and is so
still in an archaic point of view, we cannot do better than attempt to
give some idea of the difference between them, as gathered from the
two accounts now before us.[23] Unquestionably the arrangements of Mr.
Duncan suffer considerably by a comparison of points, and though we
admire the character and arduous labours of the man, there is not the
slightest need that we should abstain from hostile criticism of his
measures. For example, Mr. Duncan laid great stress on the fact of his
bank being the first self-sustaining bank, and the first not partaking
to any extent of the nature of a charity. It will be seen how far this
was absolutely true. The Ruthwell institution consisted of ordinary,
extraordinary, and honorary members. The ordinary members were the
poor who deposited their savings; the extraordinary, those who paid to
an auxiliary fund an "annuity" of 5_s._, or a single donation of
2_l._; and honorary members were those who paid to the same fund an
"annuity" of 1_l._, or a single donation of 5_l._ The general business
of the society was transacted by a Court of Directors, consisting of a
Governor, five Directors, a Treasurer, and one or more Trustees, to be
chosen from the honorary and extraordinary members. The court acted
under the superintendence and control of a Standing Committee, which
consisted of fifteen persons chosen from the self-same kind of
members. Both these bodies were subordinate again to the General
Meeting, composed of all the members of the two courts mentioned, and
all the ordinary members of six months' standing. We scarcely think
there could be any possible necessity for such elaborate machinery. In
circumstances such as the rural population of Ruthwell, were cast, one
would have supposed that rules as little stringent as possible,
hampered with conditions as few as possible, would be needed, to
induce that population to save the trifles they could spare.
Inducements were held out to encourage and reward the frugal and
attentive; and so far admirable: but the system of fines inflicted
upon those who did not deposit a certain sum each year was a
questionable proviso. Mr. Duncan put the case very plausibly in his
_Essay_, where he said the chief defect of the scheme was, originally,
the want of some strong motive for regular payments; and, "as what we
have no pressing motive to do at a particular time we are apt to delay
till it is beyond our power to do it at all," he decided to fix a
small sum as penalty, should not a certain moderate amount be
deposited each year, a decision which we think was neither proper nor
wise. The regulations acted upon in the case of a proposed new member
were, we think, equally uncalled for, and likely to scare the
well-disposed away, rather than induce them to join. Before a person's
first deposit could be received, the elaborate machinery of management
commenced to make inquiries into the age, the family affairs, and
moral conduct of the proposed contributor, and according to the report
which followed, it was considered whether his deposits would be
admitted at all, or if admitted, what rate of interest it would be
proper to allow. The society lodged its money with the British Linen
Company, and got five per cent. interest for it. Four per cent. was
the usual interest allowed to depositors; to those, however, of three
years' standing whose deposits reached 5_l._, an indulgence of the
higher rate of 5 per cent. was made, provided the depositor wanted to
get married; in case of his having arrived at the age of fifty-six; to
his friends in case of his death; or, fourthly, in case the possession
of the money _should appear to the Court of Directors_, after due
inquiry, to be advantageous to the depositor or his family.[24] To put
a climax, as it were, upon this charitable disposition of a man's own
hard-earned savings, we would merely recite the fifth statute, which
directs that "when the depositor shall have become incapable of
maintaining himself, from sickness or otherwise, a weekly allowance
may be made to him, _at the option of the Court of Directors_, out of
the money he has deposited."
The auxiliary fund, to which the honorary and extraordinary directors
were required to contribute, was employed in awarding premiums to
those who were most regular with their deposits, especially to those
regular depositors who should have exhibited proofs of superior
industry or virtue. It may well be thought that, in such delicate
matters as were thus dealt with, differences of opinion would arise,
so it was wisely provided, that any aggrieved member should have the
power of appeal from the Court of Directors to the Standing Committee,
and from the Standing Committee to a General Meeting, whose decision
should be final. "The example set by Dr. Duncan at Ruthwell," says Mr.
Smiles,[25] "was shortly followed in many other parishes in Scotland,
and in most of the principal towns in England," and, so far, we have
seen this is true. What follows is certainly open to question: "In
every instance, the model of the Ruthwell Bank was followed, and the
vital, self-sustaining principle was adopted. The Savings Banks were
not eleemosynary institutions, nor dependent upon anybody's charity or
patronage; but their success rested entirely with the depositors." Our
readers may judge from the details of management which we have given
how far this is borne out by the facts of the case; for ourselves, we
are slow to take from the merit which undoubtedly should attach to Dr.
Duncan. There were, doubtless, many circumstances connected with the
minister's own parish which made the arrangements to which we have
referred more excusable; but there must have been many districts where
the poor would never suffer themselves to be patronized, petted, or
provoked in the same manner. Hence the inapplicability of the details
to the country generally. Real, honest, independent workmen have
always had a great dislike to be experimented upon, "raised," or
"elevated," in the sense that some men use the terms; what was felt to
be required at this early period was, that there should be afforded
some facility for the depositing, without any unnecessary trouble or
annoyance, such small sums as the poor might have to spare, and wish
to save; and that this money should not only be safe, but produce
interest according to its value in the market, and neither more nor
less. That arrangements made with this laudable object should be
accompanied with others which should have the tendency, however
remote, to disgust and repel the poor, was unfortunate, to say the
least. Any interference with, or superintendence over the family
affairs or the private conduct of members, was likely to be, it seems
to us, most irksome, and no less to the poor than to the rich. The
arrangement by which various rates of interest were given to different
classes of depositors, according to their good or indifferent
characters, was eminently arbitrary, if not unfair.
We have already alluded to the Edinburgh Savings Bank, instituted
after the parent bank at Ruthwell, and to some extent upon its model;
the offspring, however, in many points presented a happy contrast to
the Ruthwell Bank, in the simplicity and greater fairness with which
its affairs were managed. As it is now a matter beyond doubt that many
banks formed subsequently were started on the model of the Edinburgh
institution, a few words of description of its principal new features
may not be out of place. All depositors were paid the same rate of
interest; they deposited their savings without any preliminary
investigation of any sort; and whilst the management was not left,
even in part, to the classes it was designed to benefit, contributors
had nothing to do but pay in such sums as suited them, and withdraw at
pleasure, altogether as the classes above them would deal in the
ordinary bank. From the pamphlet published in the same year as that of
Dr. Duncan's, and to which we have already alluded, we are enabled to
give some account of the plan of working in the Edinburgh Bank; and it
is very interesting at this distant period to see how nearly identical
with the modern Savings Bank this early one was, or rather, we think
we ought to say, how closely the example of the Edinburgh Bank has
been followed. The bank, we find, was open every Monday morning
between nine and ten o'clock. No less sum than one shilling could be
received. The uniform interest paid was at the rate of four per
cent.[26] The money might be paid back at any time on a mere demand
and production by the depositor of his _deposit sheet_. Each depositor
was furnished, on making his deposit, with a duplicate of the _leaf of
the ledger_ in which his account was kept; on each succeeding visit he
brought the duplicate with him, and each separate transaction was
entered in the ledger and on the duplicate at the same time. This
arrangement, as might have been expected, soon gave place to the more
convenient bank-book at present in use. It will be observed that up to
this time, and some years subsequently, the Savings Banks had no
connexion with Government, and the funds realized were accordingly
deposited with some banking company, and, as a rule, the interest
received was at a higher rate than has since obtained. One feature in
the Edinburgh Bank, as in other Scotch banks of the period, is unknown
at present. When the deposits of any one person amounted to ten pounds
(the minimum sum received by an ordinary bank), he was presented with
an interest-note upon any banking firm he chose to name for the
amount. Henceforth he held an account with the bank in question,
receiving a higher rate of interest, and a strengthened security for
his money. The Savings Bank, however,--and this is noteworthy,--was
still open to him as a bank for his small accumulations as before, and
until they again amounted to the sum of ten pounds. The Edinburgh
Bank, thus restricted to such small sums and simple operations, was
able to get through its work with little trouble and a minimum of
expense. Perhaps here the endeavour to save expense proceeded to too
great an extent, and resulted in more gratuitous service than the
depositing classes at any time have cared to see. No honest man would
object to have the legitimate expenses of a careful management
deducted from the interest of his savings. In recommending the system
to others, the penurious style in which it was thought not improper to
do the business is manifest in the language adopted. "It can scarcely
be doubted," says the author of the pamphlet, "that in every parish
and district there will be found persons benevolent enough to perform
the office of attending to this work, viz. one hour per week,
gratuitously, by turns; and it will be easy to procure a room rent
free. Thus the only expense of management will be the purchase of
stationery; and for this purpose the saving already described (a small
difference between the interest paid and the interest given) will be
amply sufficient, without lowering the rate of interest allowed to the
contributors. It may be supposed, indeed, that some expense may be
incurred for transmitting to the great house (the banking company
chosen) the money deposited in the Savings Bank." "But we are
persuaded," adds this man of cheap expedients, "that in every case a
safe and free conveyance will be furnished by the principal
proprietors or inhabitants of the parish." The growth of Savings
Banks, and the progress of banking generally, soon left out of view
all such minor considerations as these. Such was the excellent
institution at Edinburgh, and it deserved all the success it obtained.
At first it was thought that its connexion with the Society for the
Suppression of Beggars retarded its progress; and it was not at all
wonderful that this was the case.
Perseverance, and the laborious exertions of its originators,
especially the efforts and high character of Mr. (afterwards Sir
William) Forbes, soon made up what the bank may have lost by this
connexion, and in five years from its formation was in every respect a
decided success. Without ostentation, and without trenching in any
respect on the independence of those who needed their assistance, the
originators of this bank went on, not only in Edinburgh, but in other
Scotch towns to which their influence extended, and with which the
metropolis has always some connexion, and their endeavours to cope
with the improvidence and carelessness of that period resulted, in a
few years, in a complete spread of the principle. What society owes to
the men who at this early date laboured with such zeal and devotion in
behalf of their fellows, little thought has ever been given; the names
of many of them have not even been preserved. It ought to have been
far otherwise. "It would be difficult, we fear," says Francis Jeffrey
in an early number of the _Edinburgh Review_, "to convince, either the
people or their rulers that the spread of Savings Banks is of far more
importance, and far more likely to increase the happiness, and even
the greatness of the nation, than the most brilliant success of its
arms, or the most stupendous improvements of its trade or its
agriculture. And yet we are persuaded that it is so."[27]
Before we close this notice of original Savings Banks, we would refer
to their establishment in Ireland. The first Savings Bank in the
sister country of which record is made was one established at
Stillorgan in 1815, and was called the "Parochial Bank." The Rev. John
Reade, the parish minister of that place, was not only the founder of
this bank, but also of the second venture of the kind; for, on
removing to Clondalkin, he would seem to have taken his benevolent
disposition with him, and to have repeated the process among the poor
of his new charge. A peculiar arrangement existed in these early Irish
banks, of which no trace is found elsewhere. The deposits of each
subscriber were kept separately, and open to the inspection of the
owner when he brought any fresh deposit, on which occasion he might
count his money if he chose. So soon as the deposits of any person had
reached 1_l._ the money was invested in Stock, and produced interest,
but not till then. Both banks eventually formed the nuclei for
ordinary Savings Banks after the act relating to Irish banks was
passed in 1817. The Belfast Savings Bank, opened in 1810, was the
first formed after the ordinary model, and has always been very
successful.
[11] Mr. Scratchley's _Practical Treatise on Savings Banks_, 1st
edit. p. 36.
[12] See the _Reports of the Society for Bettering the Condition
and Increasing the Comforts of the Poor_, vol. iii. which contains
a full account of this earliest Savings Bank.
[13] "To facilitate the saving of small sums of money and to
encourage young labourers to economise their earnings with a view
to provision for marriage, it would be extremely useful to have
county banks, where the smallest sums might be received, and a
fair interest granted for them. At present, the few labourers who
have a little money are often greatly at a loss to know what to do
with it; and under such circumstances we cannot be surprised that
it should sometimes be ill-employed and last but for a short
time."--Malthus. _Essay on Population_, 1803.
[14] _Hansard_, vol. viii. p. 887.
[15] The most important clauses of this Bill we have given in the
Appendix (A). Besides its intrinsic importance, it is very
interesting, as viewed in the light of subsequent measures. The
similarity of Mr. Whitbread's proposals to the measures which
nearly half a century afterwards have been carried out, cannot
fail to strike the reader.
[16] _An Explanation of the Principles and Proceedings of the
Provident Institution at Bath_. By John Haygarth, M.D., F.R.S.,
one of the Managers, London, 1816.
[17] _Observations on Banks for Savings_. By the Right Hon. George
Rose. London, 1816.
[18] _Memoir of Dr Duncan._ By his Son, the Rev. G. J. C. Duncan.
Edinburgh, 1848.
[19] _Quarterly Review._ October, 1816.
[20] _Memoir_, page 98.
[21] _Ibid_, page 105.
[22] Strange to say, Dr. Duncan's name does not find a place even
in Mr. Robert Chambers's elaborate Dictionary of celebrated
Scotchmen, an oversight much to be regretted.
[23] (1) _An Essay on the Nature and Advantages of Parish Banks,
together with a corrected Copy of the Rules and Regulations of the
Parent Institution at Ruthwell; and Directions for conducting the
details of business; Forms showing the methods of keeping the
Accounts, &c._ By the Rev. Henry Duncan, Minister of Ruthwell.
Edinburgh. 1815.
(2) _A short Account of the Edinburgh Savings Bank, containing
Directions for establishing similar Banks, &c._ Second Edition.
Edinburgh. 1815.
[24] Duncan's _Essay_ page 27.
[25] _Workmen's Earnings, Strikes and Savings_, page 37.
[26] One clause in the Rules states that "Interest is to be
calculated by months, as the calculation by days on such small
sums would be extremely troublesome, and without any adequate
advantage."
[27] _Edinburgh Review_, xlix. page 146.
CHAPTER III.
EARLY LEGISLATION ON SAVINGS BANKS--1817 TO 1844.
"The promotion of economical habits amongst the people is
so much a matter of national concern, that we cannot
conceive any direction in which the powers of Government
would be more beneficially directed than in giving effect
to schemes calculated to produce such valuable social
results among the humbler classes of the people."--MR.
SMILES.
It was not till Savings Banks had been regularly organised in this
country, and not before they had achieved some considerable success,
that the Legislature interfered in any way with regard to them. That
the ruling classes, however, were not slow to encourage these
undertakings is sufficiently manifest, when it is remembered that the
first legislation on the subject dates from 1817, or only seven years
after Dr. Duncan had organised his parish bank; and further, that the
purport and effect of the bill then introduced was not to embarrass
and hamper the new institutions, as was too often the case with new
and partially-tried measures, but to offer them protection and
encouragement. Prior to 1817, Savings Banks were simply voluntary
associations, established, as we have already seen, by some benevolent
gentlemen, who took a sort of leading part in the affairs of their
respective neighbourhoods, and who were actuated in doing so by their
desire to afford to their poorer neighbours help and inducement to
save money. Up to this time the confidence entertained by the poor in
the integrity and well-meaning of the rich was the only security they
had that their money was in safe keeping; and it is only fair to add,
that, so long as Savings Banks were promoted and kept up in this
semi-paternal fashion, that confidence was seldom, if ever, misplaced.
Savings Banks were soon seen, however, to possess germs of national
good which would require greater means of development to be brought to
bear upon them; and it was quite as plainly apparent that the more
they extended, the greater the necessity became that they should be
legally recognised and protected. The first mention of the new
institution in Parliament was made by the Right Hon. George Rose, who
was at the time Treasurer of the Navy, and one of the Committee of
Council for the affairs of Trade and Foreign Plantations, and who, at
the close of the session of 1815, and again in April, 1816, asked
leave to bring in a bill, "to afford protection to Banks for Savings."
Mr. Rose, for the next two years, took a leading part in all
discussions on the subject, as indeed he did on all kindred
subjects.[28] He had written on Poor Laws and Benefit Societies; and,
on account of his having, towards the close of the last century,
carried through Parliament a bill legalizing Friendly Societies, was
generally looked upon as an authority on such subjects. The first
speech of the hon. gentleman on Savings Banks was remarkably able: he
referred to the immense good which such banks as those of Edinburgh
and Bath had done, and were capable of doing. The instances which had
come before him of persons who before the establishment of Savings
Banks had never saved a penny, but who then had made ample provision
for a rainy day, were cheering in the extreme. He proceeded to give
particulars of several instances of the kind, mentioning them, as he
put it, "to induce hon. gentlemen to exert themselves, and that they
might not sit with their hands before them, believing that nothing
could be done." The moral good to be expected from these banks was
great and obvious. He hoped and expected that they would gradually
tend to revive in the lower classes that decent spirit of
independence, now almost extinct, which shrinks from accepting
parochial relief; the poor man would learn to regard his own industry
and labour as the source whence he was to derive temporary aid in the
hour of sickness, or permanent support when the approaches of age
should unfit him for active exertions. Not that this matter was
applicable only to the poor; a consideration of the subject in all its
bearings might well be given to it by the rich on their own account;
he thoroughly believed that the poor-rates of the country would
diminish in proportion to the spread of Savings Banks among the
masses. _Mr. Thompson_, a Yorkshire member, expressed his warmest
approbation of the proposed bill. In Yorkshire, he knew there was a
great desire to establish Savings Banks of this sort, but the better
classes were afraid of doing so, on account of their apparent
complexity, and because they had not received up to this time the
sanction or countenance of the Legislature. He hoped the provisions of
the proposed bill would be as simple as possible, and afterwards that
the bill and its clauses would be made as public as possible. Hundreds
of working men, to his knowledge, might easily save ten shillings a
week, whereas they did not then save a penny; nor could they be blamed
to any great extent so long as they were without the requisite
machinery for acting differently. Establish these banks, and place
their working under proper Acts of Parliament, and he should then say
that many who were accustomed in times of scarcity to solicit
parochial relief would have no excuse for their conduct; if they did
not avail themselves of the opportunity of becoming independent he
would rather punish than assist them. Thus early were our legislators
alive to the maxim that "the only true secret of assisting the poor is
to make them agents in bettering their own condition." The _Chancellor
of the Exchequer_ (Mr. Vansittart) believed that nothing tended more
to the independence of the poor than their learning to support
themselves by their own exertions. He thought the object of the
proposed bill would be congenial to the feelings of the whole House.
On the part of the Government, he was ready to offer his best
assistance on behalf of an institution such as the Savings Bank, where
rich and poor might meet together and mutually combine in promoting,
under Divine protection, their natural rights. "There, forgetful of
those petty distinctions which temporary circumstances had created,
they met as brethren, each to do his duty to his neighbour." After an
Irish member had expressed his wish that the same bill might be
extended to Ireland, where, he truly said, such habits as these banks
inculcated were most urgently needed, even more so than in England,
this one-sided debate was closed.[29] The bill was read a first time
on the 15th of May, 1816. It provided, that any number of individuals
might enrol themselves as Trustees of a Provident Institution or
Savings Bank at the Quarter Sessions. It was not meant by this to give
any power to Justices of the Peace, but simply that the act of
enrolment might thus be made in as public a manner as possible. It was
further arranged, that the Rules proposed for the management of the
new Savings Banks should in like manner be left with the Clerk of the
Peace for the respective counties. The bill authorised the Trustees or
Managers to appoint such officers as were likely to be needed, and
required that in all cases where the persons were to be entrusted with
money, they should give reasonable security. It was only further
provided, that depositors should not be prevented from applying for
parish relief, but that, if any dispute arose on this point, the
decision in the matter should be left with the magistrates in Quarter
Sessions. The session being near its close, and several members having
expressed their sense of the importance of the subject and the
necessity of producing a well-considered bill to regulate these banks,
the bill was withdrawn till the next session. On the 15th of February,
1817, Mr. Rose again returned to the subject, and got leave to
re-introduce his bill. He did not on this occasion enter minutely into
the consideration of Savings Banks, further than to express a
conviction he had, "which daily became stronger," that these
institutions, if properly directed, would have a very direct influence
on the vexed question of Poor Law relief. He contended, that, if they
became generally introduced through the length and breadth of the
country, they would gradually mitigate, and then do away with, the
evils attending the system of the English Poor Law; and he very
reasonably urged that any measure which would tend, even remotely, to
such a desirable object, was deserving of, and ought to have, the
hearty support and countenance of the Legislature. _Mr. Curwen_, an
authority on this phase of the subject, held that there could be only
one opinion as to the utility of the banks, but he was satisfied "it
was an error to imagine they would essentially contribute to the
alleviation of the present distressing situation of affairs." Nothing
short of a measure which in its nature might have a compulsory
influence over the minds of the people, to teach the poor and the
peasantry that the means of relief, of content and happiness, were
within the reach of their own exertions and industrious application,
would be effectual. After a little further opposition, during which
another member said that the bill would do more harm than good--that
Savings Banks were going on extremely well without any Act of
Parliament, _Mr. Wilberforce_, ready at all times to forward any
measure which seemed likely to benefit the poorer and more defenceless
portions of society, congratulated his friend on his proposals, and
said that the system of Savings Banks pleased him most because it was
so eminently adapted to teach the poor how much they might do for
themselves by their own self-denying exertions. This was one of the
class of things for which he, the House, and the country ought to be
extremely indebted to all who had been instrumental in originating it
and bringing it to greater perfection. "Whatever difference of
opinion," continued Mr. Wilberforce, "there might exist as to the Poor
Laws, it was of all things desirable to countenance and foster so
sanative a principle as that on which Savings Banks were founded." The
second and principal reading of the bill took place on the 15th of
May, 1817, on which night many petitions were presented in its favour,
and only three--viz., from Norwich, Hertford, and St. Paul's, Covent
Garden--against it. All opposition, however, to the bill resolved
itself into simply contesting one or two of its clauses. An attempt
was made to throw out the clause which obliged the Trustees of Savings
Banks to vest all moneys received by them in the Public Funds, several
members contending that at any rate some of the money might be much
better employed on mortgage, to the relief of many different interests
in the immediate neighbourhood, and to the greater productiveness of
the money so lent. The arguments used on this occasion were very
similar to those occasionally used now in relation to the same
subject, and they were then as unavailing as they have been
subsequently: the preponderating opinion was that the _safety_ of the
investments was, and ought to be, the first and greatest
consideration. The clause, however, which proposed the giving of
premiums out of the parish funds to those contributors who had done
best in the way of saving money, fared worse, being rejected in
committee almost unanimously. The growth of such principles could not
be forced, and, if they grew at all, they would do better without the
crutches eleemosynary aid. At the third reading, a spirited contest
arose about the proviso that depositors in Savings Banks should not be
disqualified from receiving parochial relief. _Mr. Rose_ contended
that anything, which would have a tendency to make the poor think that
the richer classes were legislating with ulterior objects in view,
such as to get rid of poor-rates, would throw obstacles in the way of
Savings Banks. There would be no need to think of such considerations
in a few years, when Savings Banks were more firmly fixed amongst the
institutions of the country; it was highly expedient, however, that
they should now be allowed to have their weight. In a few years,
argued he, the poor will have formed habits of saving, and so they
will have become independent, and be above throwing themselves on the
parish, at any rate with impunity. Mr. Wilberforce held and expressed
the same view, which Lord Milton and others opposed; the clause was
retained, notwithstanding, by a majority of thirty-three in a House of
eighty-seven members. With this discussion the bill passed, and became
law in August, 1817. As this bill[30] is the beginning of legislation
on the subject of Savings Banks, we would here state in outline the
principal objects with which it dealt. A sort of Supplementary Act,
cap. 105, was passed to apply more particularly to Ireland, to suit
the Irish members, who, when the matter was under discussion, argued
that the same Act would not deal so well with Ireland, and who,
therefore, wished the two countries treated separately. Both the acts
required that the Rules of the proposed Bank for Savings should be
deposited with the Clerk of the Peace of the county in which the bank
should be situated, though no discretionary power was left with the
magistrates in the matter. The Trustees and Managers were prohibited
from receiving any profit from any transactions in these banks, and
were empowered to pay over the moneys they received into the Bank of
England, or Ireland (as the case might be), to the account of the
Commissioners for the Reduction of the National Debt, the latter being
instructed and empowered to invest them in Three per Cent. Bank
Annuities. Interest on money thus deposited in the hands of Government
was guaranteed to the Trustees of Savings Banks at the rate of 3_d._
per cent. per day, or 4_l._ 11_s._ 3_d._ per annum. The Act restricted
the amount which any one depositor could place in a Savings Bank in
England to 100_l._ in the first year, and 50_l._ in any subsequent
year. In Ireland the limitation was 50_l._ in any year, though why
this distinction was agreed upon does not appear.
It was not long before it was seen that the Act just described was
defective in many particulars, and further legislation rendered
necessary. During the year which elapsed after the passing of the
Savings Bank Act, the progress of these institutions, in so far as the
number and amount of their deposits were concerned, was great beyond
all expectation. In nine months from the date of the bill of 1817, the
large sum of 657,000_l._ had been deposited. The largest amount
received at the National Debt Office during that period from any one
bank was 32,000_l._, remitted from the flourishing Exeter bank; the
smallest was received from a new bank just then opened at St. John's,
Wapping, for the benefit of sailors living in that locality. By the
middle of the year 1818, or less than twelve months after the passing
of the first bill, there were no fewer than 227 banks established in
England and Wales, and about an equal number in Ireland and Scotland.
That the encouragement which the bill had given was real is evident
from the fact that more than half the entire number of English banks
were first opened in 1817-18. So rapid indeed had been the development
of the measure, that it was soon apparent that the increase of
deposits was in a ratio far beyond any possible increase in the amount
of wages or profit from which small savings could have been made. No
doubt that now, for the first time, many hoarded savings saw the
light, and began to bring in to their owners a return; but even this
does not account for such an increase of business. Towards the close
of 1817, 20,000_l._ was deposited in one day, in a town in the North
of England where a bank had just been opened, and it was known that
very little of this money belonged to the industrial classes.
The interest given for the investment made, it appeared, was
attracting a much higher class of depositors than it was ever sought
to encourage, or than the Act was intended to benefit. The interest
guaranteed by Government has already been stated. In amount, it was at
least 11_s._ 3_d._ more than the interest yielded by any other
Government security, while Consols did not bring in more than 3_l._
5_s._ per cent. Many, we believe, in the first instance put their
money into the Savings Banks to afford encouragement to their poorer
neighbours or dependents, and in order to inspire them with
confidence: and it will be well understood how necessary this was at
the outset, seeing that at that time there were few means of
inculcating sound political knowledge, or, indeed, information of any
sort, among the great mass of the people, who too often were swayed
hither and thither at the mere whim of some noisy and ignorant
demagogue. Whether or not this sufficiently accounts for the fact of
the better classes contributing to the early Savings Banks, it is
clear that all classes soon found out that it was not possible to do
better with their money, and hence allowed it to remain where it was.
Several banks were very careful to exclude by their rules all but
mechanics, servants, and persons in similar ranks of life, but the
rest either had no such rules, or were very careless about enforcing
them. One gentleman, possessed of 40,000_l._ was known to have
deposited large sums of money in one Savings Bank in the names of his
six children. On the 17th of March, 1818, the Chancellor of the
Exchequer, influenced by such abuses as these, asked leave to bring in
a bill to amend the Act passed last year. No trace of the proceedings
of Parliament with regard to this little bill remains, but it seems
only to have been meant as a temporary measure of relief till the
whole subject could be more effectually grappled with. It simply
provided for some alterations in the forms of debenture, gave power to
Justices of the Peace to reject, for a sufficient reason, any Rules
deposited with their clerks, and prohibited the arrangement by which a
person might invest in a Savings Bank by means of a ticket or number,
and without disclosing his or her name.
Shortly after this period, in the year 1819, a question was put to the
Chancellor of the Exchequer in the House, which seems to have raised
some merriment among the members. Ridiculous as it might seem, it only
reflected the spirit in which many people spoke of the measures which
had recently been passed with regard to the compulsory investments
with Government of the money placed in the banks. In Lancashire, aided
and stimulated by Mr. Cobbett, who all along sneered at the "bubble"
of Savings Banks, the people got up an absurd cry, and long kept it
up. _Mr. Wilbraham_, a Lancashire member, asked Mr. Vansittart if
there was "any tittle of truth" in the reports that were so prevalent
"that Government was about to seize the funds of the Friendly
Societies and Savings Banks, and apply them to the payment of the
National Debt. This report," said the hon. member, "had been caught up
by persons little conversant in political matters, and had actually
caused the breaking up of Friendly Societies, to the great loss of
those who had claims upon them." He had no doubt the course of
legislation had led to this report being circulated by designing
persons, and though quite aware that it was impossible for the
Government to touch any of these funds, he would like to hear a
declaration on the subject from the authority which in that House was
alone competent to give it. _The Chancellor of the Exchequer_ said,
that even after much experience of the extent to which malignity and
absurdity could go in the propagation of reports injurious to the
Ministry, he had not been prepared for such a rumour as this. "It was
utterly groundless; there was not the smallest foundation for it,
either in fact or possibility. Under the authority of Parliament, the
money belonging to the institutions in question was kept _entirely
apart_ from the public money, and even if the Treasury were base
enough, they had not the power to misappropriate these funds."[31]
_Mr. Brougham_ observed that this was not the first time that such
reports had been circulated, and such absurd cries raised. When the
Education Committee was sitting, it was asserted that its intention
was to seize all charitable funds, and to turn the two Universities
into charity schools. In such cases as these facts or reason on such
reports were very ineffectual, but he hoped that in this particular
instance they would be of some avail.
Before we notice the further progress of legislation in respect to
Savings Banks, it would be well to refer to their progress and
operation in Scotland. None of the Acts passed up to this time in any
way related to the Scotch banks. When Mr. Rose's bill was before
Parliament, its application to Scotland was successfully opposed; a
separate bill was introduced by Mr. Douglas, the member for the
Dumfries burghs, in 1818, but this did not pass. The failure to obtain
this act was said to be owing exclusively to the necessity for
legislative interference not being felt in Scotland; it seems now much
more likely that the failure was owing to the want of unanimity among
the Scotch promoters of Savings Banks, Mr. Duncan taking a decided
stand with the member whom he had influenced so far as to get him to
bring in a bill, and the promoters of the Edinburgh bank, on the other
hand, who kept up in this way the long-standing dispute which they had
always had with "the Father of Savings Banks."[32] There was certainly
some reason why the same legislation was unnecessary for the two
countries. There were many circumstances which rendered interference
on the part of the Legislature necessary, or at least expedient, in
the case of the English banks, and these circumstances scarcely in any
way applied to Scotland. The chief of these were the Poor Laws, and
the want of secure places of deposit for small sums to bear interest,
and be payable on demand; the English bankers did not usually allow
interest on money lodged with them, whereas in Scotland they gave a
liberal return for it. The general dispute was at its height in 1819,
when the Edinburgh Society published a report against any State
interference, and when Mr. Duncan, who, as we have already said, was a
strong advocate for parliamentary encouragement and protection,
replied in a lengthy and able letter,[33] in which he clearly showed
that difficulties and discouragements would surely be felt in the
progress of Savings Banks, if they were not arranged according to law.
The radical difference observable in the two classes of banks--and
there were at this time 182 Savings Banks in Scotland with 7,000
depositors, and deposits to the amount of 30,000_l._--was the
difference between the Parish Bank at Ruthwell, and the Savings Bank
at Edinburgh, for on one or other of these models all the Scotch banks
were with very few variations formed. Mr. Duncan placed, or intended
to do so, the management of his bank in the hands of the whole body of
depositors; the Edinburgh bank excluded all popular interference in
its management, and left every one to deal with it or not, at their
pleasure. The Ruthwell bank confessedly, and as we have seen, partook
of the nature of a Friendly Society; the Edinburgh bank as nearly as
possible approached to the character of a commercial undertaking. The
founder of the former was thus an advocate for minute regulations,
while the patrons of the latter wished to be left at liberty to manage
their affairs in their own way, and only to call in the help of the
Legislature when real grievances needed redressing.
With the exception of a short Act[34] passed in 1820, by which it was
provided that charitable institutions might deposit a whole or a
portion of their funds with the Commissioners, no further legislation
on Savings Banks was attempted till 1824. In this year the Chancellor
of the Exchequer (Mr. Robinson) took up the matter where Mr.
Vansittart had left it, and carried a Bill through Parliament still
further to amend the law.[35] With a view to remedy still more
completely the evil of classes, other than the industrious ones,
investing their money in Savings Banks, this Act provided that the sum
which could be deposited during the first year should be limited to
50_l._ and should stand at 30_l._ for any succeeding year. To provide
against anything like evasion of these regulations, a form of
declaration was introduced,--which we scarcely need say has existed up
to the present time,--stating that the subscriber to it had not
contributed to any other bank than the one at which he made the
declaration. The Chancellor of the Exchequer endeavoured to carry a
clause which required that this declaration should be subscribed by
the proposed depositor in his own name, "and own handwriting," in
place of a mark or initials, but this was wisely discarded. This
absurd proviso would have put an educational test in the way of those
very classes whom, to the exclusion of all others, it was desirable to
attract to Savings Banks. Another important clause succeeded better,
and was plainly proper to the object meant to be served by it. No
depositor could by this further clause invest more than 200_l._
excluding interest, in any Savings Bank. The case of the funds of
Friendly Societies was the subject of another clause. It was only four
years since these societies, as we have seen, were allowed to deposit
their funds through the medium of Savings Banks; but the Act of 1820
had given rise to so much abuse, or to so much that seemed like abuse,
that some alteration was necessary. The high rate of interest which
had been guaranteed by law to these banks induced, not only
individuals of rank and property, but large charities to place their
funds in them: the result was a great burthen to the public, inasmuch
as the excess over the ordinary rate of interest for public securities
was thrown in by the Legislature with the object of increasing the
provident disposition of the poor. As it was seen that, if this state
of things continued, the original object of State assistance and
countenance to Savings Banks would be defeated and the public in some
degree prejudiced, it was proposed that no friendly society or
charitable institution of any kind should deposit their funds in any
bank. If the alterations now proposed did not suffice to preserve
Savings Banks from the inroads of the rich, the Chancellor of the
Exchequer saw no other means of meeting the evil than by reducing the
interest given. He "should feel most reluctant to weaken the
confidence which the public reposed in these banks, and which rendered
them one of the greatest blessings ever conferred upon the country;"
but the evil must be met in one way or the other, or with the loss of
their normal character they would lose their efficiency.
The Act of Amendment then went on to deal with the responsibility of
Trustees, the giant difficulty of Savings Banks from that time until
now. The same arguments were used at this early period as at different
times subsequently. Those who placed money in Savings Banks ought to
have some security that that money was not made away with by some one
through whose hands it would pass; and the Trustees, who had the sole
control over the affairs of the banks, and appointed all the
subordinate officers, were the persons who ought to give some
security. On the other hand, enforce to the full the liability of
Trustees, and the most able persons would be deterred from accepting
so much responsibility, and would give up the connexion which they had
already voluntarily assumed. It was now therefore settled that the
Trustees should deposit all the money they received with the National
Debt Commissioners, and that they should be held liable in case of
default only to a certain amount. A legally and efficiently
constituted bank should consist of twelve Trustees, each liable for
50_l._, or 600_l._ in the aggregate. This Act, it was also decided,
should refer to Ireland equally as to England.
Early in February, 1828, _Mr. Joseph Hume_--who had not then been many
years in Parliament, but who had already commenced that course of
conduct in connexion with the public expenditure which, at first,
gained him little but ridicule and derision, and subsequently the
respect of friend and foe and the confidence of the entire
nation--took up the question of Savings Banks, or more especially that
part of it which related to the question of expense to the Government.
Mr. Hume had already asked for returns of the progress of Savings
Banks; but on the 6th of this month he required the production of an
account, showing the amount of interest that had been allowed to them
since they had become connected with the State in 1817. He tried to
disabuse the mind of the members of the House as to his having any
prejudice against Savings Banks. He told how he had been one of the
earliest friends of these institutions and heartily wished well to
them. When he found, however, that they had already cost the country
half a million sterling, and were likely to cost still more as their
numbers and efficiency increased, he thought it was high time to have
the matter inquired into, and this expenditure stopped. Mr. Hume said
that his original notion about Savings Banks,--which was likewise that
of all he knew who had endeavoured to establish them,--was that each
bank might, and therefore ought to maintain itself, and, whilst it
enabled the poor to invest safely their 10_l._ or 20_l._ as cheaply
and as profitably as the rich could their larger amounts, it should
neither be a burthen on the charity of the benevolent nor an incubus
on the State. Mr. Hume stated that he believed it would be found that
up to January, 1827, the amount paid to Trustees, over and above what
the money remitted to the National Debt Commissioners had produced,
was 452,000_l._ By the arrangement of the Act of 1817, which ordered
that a separate account should be kept of the moneys deposited with
Government on behalf of Savings Banks, he was enabled to tell exactly
how affairs stood. He found that Government had obtained interest on
the Savings Bank Fund to the extent, in round numbers, of
2,250,000_l._ and had paid to depositors for the same 2,703,000_l._
Hence the loss[36] above given, which he had no doubt by the time the
accounts were finally made up for the financial year ending in March
would be half a million sterling. Mr. Hume went on to state that, if
honourable members thought it proper after an inquiry to pay
40,000_l._ or 50,000_l._ a year, as a means of encouraging these
banks, let them do so; perhaps he would not make any more appeals
about it; at any rate, however, in this case, and if this state of
things continued, he thought it would be only fair that Government,
and not separate directors, should have the management and control of
these banks. There was no possible uniformity among them; some paid
one rate of interest, and some another; some charged much higher for
paid assistance than others, and yet, with unvarying uniformity, he
might have said, the executive granted the same high rate of interest
to all, irrespective of how they disposed of it. The Returns were
ordered _nem. con._ The Statement which Mr. Hume more particularly
referred to is in its proper place among the "Accounts and Papers" for
that year, and is as follows:--
+---------+--------------------+------------------+-----------------+
| | Dividends on Stock | Interest Paid | |
| Years. | Received by | Trustees. | Difference. |
| | Commissioners. | | |
+---------+--------------------+------------------+-----------------+
| | £ s. d. | £ s. d. | £ s. d. |
| 1817-18 | 32,071 1 5 | 44,909 5 1 | 12,838 3 8 |
| 1819 | 92,865 13 7 | 106,963 4 9 | 14,097 11 2 |
| 1820 | 124,278 8 2 | 141,488 1 3 | 17,209 13 1 |
| 1821 | 163,631 1 1 | 182,649 13 3 | 19,018 12 2 |
| 1822 | 225,252 6 1 | 253,629 4 11 | 28,376 18 10 |
| 1823 | 298,270 10 1 | 340,757 0 2 | 42,486 10 1 |
| 1824 | 379,411 6 7 | 468,261 12 1 | 88,850 5 6 |
| 1825 | 450,027 13 0 | 562,759 0 4 | 112,731 13 4 |
| 1826 | 478,286 5 3 | 592,390 18 11 | 114,104 13 8 |
| 1827 | 480,851 13 0 | 615,516 1 7 | 134,664 8 7 |
| 1828 | 515,569 9 4 | 675,753 16 7 | 160,184 7 3 |
+---------+--------------------+------------------+-----------------+
A month afterwards, the Returns having been furnished, Mr. Hume
returned to the charge. The accounts had more than borne him out in
all particulars. He now again asked if the daily loss ought to be
suffered in the financial state the country was in. The Act regulating
Savings Banks ought to be repealed, and another passed in its place.
His opinion was, decidedly, that Government should just give the
interest which it realized by the Savings Bank money, and not add a
farthing to it. "At a change in the price of Stock," added the
reformer, "Government might very possibly lose three or four millions,
and yet the depositors would not suffer the loss of a penny." Much as
he wished for the progress and advancement of the poorer classes--and
few, we think, worked harder to obtain it for them,--he contended that
these classes ought to be placed precisely in the same situation as
other people who had capital to invest. Another point which Mr. Hume
dwelt upon was the _surplus money_ which managers of Savings Banks had
in their possession untouched, after paying their depositors all the
interest that was allowed them. At that time Mr. Hume stated that the
surplus in the Newcastle Savings Bank, after paying the expenses of
management, amounted to 4,810_l._ and in the Exeter and Devon Bank to
a still larger sum; and this money which had been paid by Government
and saved after the Trustees had given a liberal interest to
depositors, was now turned into an invincible argument for some change
in the law. Mr. Hume concluded with expressing a hope that Government
would bring in a bill to amend the law relating to Savings Banks, or
at any rate not throw any obstacles in the way of some private member
doing it. The Secretary of the Treasury said, in reply, that Mr. Hume
had stated the case fairly and correctly; and that the Chancellor of
the Exchequer fully intended during the present session to bring in a
bill with which he hoped _to satisfy all classes_.[37] The
vicissitudes of party prevented this high Government functionary from
carrying out his laudable, but very impossible design. In a few weeks
the Chancellor is on the other side of the House, and another occupies
his place. A bill, however, was introduced on the 5th of June, 1828,
by Mr. Pallmer, which, supported by the new Administration, was passed
through Parliament, and became law in the same year.[38] In
introducing this bill, _Mr. Pallmer_ said it was quite obvious that
the laws which affected Savings Banks ought to be as clear and as
distinct as possible. Savings Banks were now very important
institutions, and the welfare of thousands was connected with them. At
that time there were no less than five Acts of Parliament regulating
Savings Banks, and these Acts, which contained 150 clauses, involved
an enormous amount of confusion and perplexity. He would in the place
of these five Acts, propose an Act, simple and consolidated, of thirty
or forty clauses. He would endeavour to deal with all the questions of
interest allowed, surplus money, responsibility of trustees, and to
make the necessary restrictions towards carrying on the banks safely.
And leave was quickly given to proceed with the bill. Nothing
transpired in the passage of the bill through Parliament of much
moment: so little hold were questions of this nature supposed to have
on the public mind, that it is barely alluded to in the pages of
_Hansard_. It seems never to have occurred to the reporters of the
day, that posterity might wish for a detailed account of the steps by
which institutions, such as these we are considering, arrived at some
important position, and so important indeed as to make every step of
that progress interesting after the lapse of years. Two or three
little incidents have survived this neglect. _Mr. Lewis_, for example,
during the second reading of the bill, proposed a clause for
preventing the National Debt Commissioners from taking more than
20,000,000_l._ from the Savings Bank Trustees, and ordering that, when
that amount had been invested, the funds should be declared full. The
answer which Mr. Goulburn, the new Chancellor of the Exchequer, gave
to the hon. member was, that he "would take a day or two for
consideration, after which he should be able to say better whether
such a clause ought, or ought not, to be agreed to." Two or three days
before there had appeared in the _Times_ newspaper a well-written
lampoon on the new Ministry, over which, it will be remembered the
Duke of Wellington presided as Premier, and one verse ran--
"To rest from toil our Great Untaught,
And soothe the pangs his warlike brain
Must suffer when, _unused to thought_,
_It tries to think, and--tries in vain_."
_Sir Joseph Yorke_ embraced the opportunity to compliment the
Chancellor, amidst great laughter, on being such a "valuable auxiliary
of the 'Great Untaught.' The right hon. gentleman evidently was not
one who spoke on the strength of two bottles of wine: his eloquence
was certainly not of a fiery description;" and more banter of the like
description. Mr. Lewis, however, withdrew his amendment, as did also
Mr. Hume, who, when the amount of interest which should be given was
discussed, had proposed that, in place of a reduction from 3_d._ to
2-1/2_d._ per diem, the interest on deposits should only be at the
rate of 2_d._ per diem. The bill was only further opposed in some
trifling particulars and, when finally carried, was ordered to come
into operation in the November of the same year. The statute was
entitled, "An Act to consolidate and amend the Laws relating to
Savings Banks," and repealed all other Acts previously in force. From
this circumstance, the clauses of the bill of 1828 are generally known
as the "Governing Statutes" relating to Savings Banks. As the great
majority of these clauses are still in force, it will suffice, when we
come to give the present Act, to simply mark those which were
originally passed in 1828, and so distinguish them from the clauses
passed in 1863. We will here give the principal items and arrangements
of the new bill. The Act provided that the rules of every Savings Bank
should be entered in a book, which book should be deposited with the
Clerk of the Peace: the Clerk of the Peace was directed to submit this
book to a barrister, who, under the terms of the Act, would be
appointed by the National Debt Commissioners.[39] The duty of the
barrister would be to certify that the Rules of the proposed bank were
strictly according to law, and this certification, after it had been
made, was to be laid before the Justices of the Peace in Quarter
Sessions, who were empowered under certain circumstances to reject the
same, or any part thereof. If admitted, as they most commonly would
be, after certification, the Rules became binding on depositors and
officers. The interest to be given to depositors, as we have already
stated, was reduced by this Act from 4_l._ 11_s._ 3_d._ per cent. per
annum, to 3_l._ 16_s._ 0-1/2_d._ per annum. It was provided that
savings of Minors might be invested, and that deposits might be made
by married Women. Charitable Societies were again authorized to invest
sums not exceeding 100_l._ per year, or 300_l._ in the whole. Friendly
Societies were also authorized to subscribe any portion of their funds
into Savings Banks, but a Friendly Society enrolled after the date of
the bill could not invest more than 300_l._ principal and interest
included. Trustees were not to receive from any one depositor more
than 30_l._ in any one year, nor more than 150_l._ in the whole and,
when the deposit and interest amounted to 200_l._ interest was to
cease. Depositors might withdraw their money and again subscribe,
providing they did not do it to a greater extent than 30_l._ in any
one year. Deposits might be withdrawn from one Savings Bank and placed
in another. Should a depositor die leaving any sum exceeding 50_l._
the same was not to be paid without probate or letters of
administration. Administration bonds for effects under 50_l._ were
exempt from stamp duty. Section nine exacted that no Trustee or
Manager should be responsible except for his own wilful neglect or
default; and finally, and a matter of considerable importance, the
bill provided that once in each year the Trustees of every Savings
Bank should make a Return to the National Debt Office, in which a full
Financial Statement should be made of the condition of the bank; and a
minor clause enacted that depositors should be entitled, on payment of
one penny, to a printed copy of this Annual Statement.
For several years after the thorough change which we have just
described, the institution of Savings Banks increased and prospered
wonderfully; up to the year 1833, we find that no steps were taken,
nor agitation of any sort got up, to alter the law with regard to
them. In this year, some further changes took place; but if we except
a slight modification which was made in the arrangements under which
depositors could withdraw their money,--a longer notice being thought
necessary,--nothing was done which did not place additional powers in
the hands of Trustees.
In April, 1833, Lord Althorp, Chancellor of the Exchequer in the
Government of Earl Grey, influenced, by a suggestion of Mr. Woodrow,
introduced a bill to grant immediate and deferred annuities through
the medium of Savings Banks, and to grant them on so small a scale as
to place them within reach of the humblest classes. Something of this
sort was undoubtedly required, and the necessity became more and more
felt on account of the action of Friendly Societies. The poorer
classes, it would seem, had scarcely any means of investing in
pensions for their old age: although nearly 5,000 Friendly Societies
had up to this time proposed to make some provision of the kind, all
but thirty-nine had in 1833 entirely relinquished this class of
business. It may be said that Friendly Societies gave up this business
because so few availed themselves of the provision that was made. From
the very constitution of these societies, however, the poor had little
confidence that any one of them would last so long as to give them
those benefits in their old age for which they would have to subscribe
for a long term of years. Benefit Societies might be broken up at any
time by two-thirds of their number; this sort of thing was constantly
occurring, generally leaving the oldest members in the lurch. An
attempt, to which we have not yet alluded, was made even before
Savings Banks were established, to give the industrial classes a
chance of providing for their old age, and preventing them from being
left destitute of other support than parish pay, or a home in the
workhouse. Baron Mazeres, so early as 1773, who published a work on
Annuities, succeeded in getting a bill introduced and passed through
the House of Commons--though unfortunately it was lost in the House of
Lords--which would have made the legislation of 1833 less necessary.
_Lord Althorp_ now stated that the object he had in view was simply
and solely to benefit the working classes. The lowest sum which could
be granted as a Government Annuity was 30_l._ a-year. He would propose
to make the sum 20_l._ The annuity should not be assignable, or
transferable, except in cases of bankruptcy or insolvency; and in the
case of the purchaser, either through necessity or choice making
default in the annual payments, or dying before the annuity commenced,
the whole of the money subscribed should be paid to him or his
executors. The tables would be calculated at the rate of 3_l._ 15_s._
per cent. and this rate being less than the ordinary Savings Bank
rate, would enable the Government to introduce the clause for
returning deposits. To no class, it was thought, would these proposals
be of more service than to members of Benefit Societies, who would
thus be enabled to secure superannuation on Government security, and
confine the objects of the society in which they might be members to
relief in cases of sickness or death. Lord Althorp calculated that a
person at the age of twenty-five, paying six shillings a month as a
deposit into the Savings Bank, would be entitled at the age of sixty
to an annuity of 20_l._ a-year. He contended, that, from the
calculations which had been made, Government could not lose by these
arrangements, and he thought the principal feature of deferred
annuities for a small amount, with money returnable in the cases above
stated, might be made,--if the working classes would only avail
themselves of the measure,--to tend greatly to their worldly comfort
and advantage. _Mr. Thomas Attwood_, the member for Birmingham, who
made some remarkable speeches in the House on matters of finance, but
especially with regard to Savings Banks, objected not only to this
proposal, but to legislation of any sort with regard to them. The
money deposited in Savings Banks might as well be put into the country
banks, for the average amount of each deposit, he was sure, was over
10_l._ and 10_l._ was the minimum sum which country banks would take.
He "did not believe in paying so much to keep up such establishments,
especially when they were not wanted." To such lengths will
intelligent men go, and to such an extent will they shut their eyes!
Mr. Attwood put his views before the House quite mildly in this
instance, as compared with subsequent speeches. _Mr. Brotherton_, a
member greatly respected in the House, who had once belonged to the
ranks of the people, and who might therefore be supposed better to
understand their requirements, felt sure that Savings Banks had been
productive of great national good, and could not be too numerous. _Mr.
Pease_, the Quaker member for South Durham, hoped that nothing would
be done to induce the working classes to try country banks in
preference to Savings Banks. In his own county 700,000_l._ or
800,000_l._ had been lost in country banks, and therefore it would be
highly dangerous to advise the poor to lodge their money there. Mr.
Pease's position, as a large employer of labour, gave his remarks
weight, when he trusted that the clause in the bill of 1828, which
provided that Accounts of Savings Banks should annually be laid before
the Government, would be carried out in its entirety; "there was
little hope of Savings Banks turning out uniformly profitable to the
industrious classes, except Government maintained a strict
superintending control over them." The Chancellor of the Exchequer
said this was done, and in two or three instances since he took
office, where the Trustees had neglected to furnish proper returns,
the Commissioners had exercised the power which the law gave them,
_and had closed the banks_ till the Accounts were sent up.[40] In May
the bill was carried through Parliament unaltered, but, as usual,
opposed by two or three fractious members. Mr. Thomas Attwood again
expressed his disapprobation of Savings Banks; and we allude to his
speech with a view solely of enlivening our pages, which may over this
ground of legislative enactments be dull to some readers. This
gentleman stated his belief on the third reading of the Savings Bank
Annuities Bill, that Savings Banks "were instituted by the late Lord
Liverpool and his Government, not for the good of the people, but for
three different purposes." The first was to draw capital to London, in
order to bolster up the Funds; the second was to give the Government
the power of putting their hands into the pockets of the people; and
the third, to enable them to scourge the people.[41] On the House
showing manifest signs of disapprobation, Mr. Attwood said, "Hon.
members might express disapprobation as much as they pleased, and the
noble lord (Althorp) might laugh, but he firmly believed that Lord
Liverpool's great object in getting up these banks was to get his claw
in the people." _Lord Althorp_ replied with the straightforward
understanding, and quiet, manly good sense which always characterized
this eminent statesman. He wondered that Mr. Attwood had not imputed
to Government another motive, that being, to realize _profit_ by
Savings Banks, which he need not say they had scarcely yet done. He
might have smiled, but it was entirely on account of the originality
of the hon. member's ideas on the subject: seriously, it was
astonishing that such arguments should be used by reasoning men. "So
far from being an injury to the people, he believed these banks
conferred on them the greatest advantages; and so far from affording
the Government the means of trampling upon them, they would have an
exactly contrary effect." And there can be no question that Lord
Althorp was right. The evident effect of Savings Banks, from their
commencement, had been to make people independent; and surely persons
of this description would be the very last that any Government would
attempt to ill-use. Another member spoke a word for Mr. Attwood: he
believed him to have the kindest intentions towards the poor; only, he
must add, that he took the strangest way of showing these good
intentions, when he strove to prejudice the poor against institutions
which were capable of rendering them independent and comfortable
sooner than any other organization whatever. _Mr. Slaney_ thought the
people showed great good sense in preferring Government security to
the allurements of country bankers. As for the member for Birmingham,
he ought to be reminded of Franklin's story about the two sacks, where
the empty sack fell to the ground, whilst the full sack stood bolt
upright. The fuller the sacks, the more likely were the people to be
independent, and the less likely were they to be trampled upon. Mr.
Slaney was glad to find, that though the crisis of last session had
had a bad effect on the deposits of Savings Banks, they were now daily
increasing. With this discussion, so far as any record is left, the
bill became law.
An act passed in 1835[42] extended the bill for consolidating and
amending the law with respect to Savings Banks to Scotland, and of
course the bill of 1833, which we have just described, became at the
same time applicable to Scotland.
Nothing further was done in the way of legislation for Savings Banks
till 1844, so we will close this chapter by referring to another
attempt made by Mr. Hume, in 1838, to reduce the interest given to
Savings Banks, and to introduce other changes into their organization.
And here we cannot forbear to state our belief, that, though many
thought very differently at that time, Savings Banks, the working
classes, and the country generally, had not a better friend than Mr.
Joseph Hume. He saw a lavish expenditure going on in connexion with
Savings Banks, and he endeavoured to stop it; with what success
remains to be seen. He saw that in consequence of this expenditure, or
the inducements which it gave, legislative enactments were openly set
at defiance by well-to-do people, who, besides their own deposits,
made fraudulent investments in the names of the various members of
their families, or their friends; and that the action of the
Legislature was in this way an attempt to cultivate good habits
amongst one portion of the community, at the expense of promoting bad
habits amongst another. Mr. Hume on this occasion reminded the House
that he was one of the original founders of Saving Banks, and had
always taken a deep interest in them. It was far from him to do
anything to interfere with their usefulness in the country, only the
country ought not to be put to large and increasing expense over them.
He compared the rate of interest given before and after 1828, and now
stated that on this latter rate the country lost from ten shillings to
fifteen shillings per cent. on the entire amount of deposits. The
average annual loss to the public up to the time he was speaking, and
from 1818, had been 75,000_l._ If this money went to the provident
poor he would not so much care; but if all was paid to depositors,
that might not be the case. Of the 500 Savings Banks in existence in
1837, to whom the Commissioners paid 3_l._ 16_s._ 0-1/2_d._ per cent.
interest, 412 of them paid to the depositors only 3_l._ 6_s._ 8_d._,
and 88 of them paid 3_l._ 8_s._ leaving of course a large surplus,
after every expense had been paid, in the hands of both sets of
trustees. Hon. gentlemen might say that this surplus money was
required by law to be invested in the Surplus Fund account at the
National Debt Office; but the act, in leaving it to the trustees to
say what they themselves deemed "surplus," defeated its own ends, and
without doubt had opened a door to fraud. Mr. Hume made a motion that
the House at its rising should go into committee on the 9th Geo. IV.
c. 93, which fixes the rate of interest to be given, and to permit the
Chancellor of the Exchequer to reduce that rate to an equality with
that which is received in the public funds. He thoroughly believed
that the security afforded by Savings Banks was a matter of far
greater importance than the amount of interest which was paid. Mr.
Hume then referred to a subject which was made matter for great
discussion, and which a committee of the House of Commons treated at
great length some years subsequently. This was the power which was
supposed to rest with the National Debt Commissioners, of using
Savings Bank money for the exigencies of the State; "the dangerous
power," as Mr. Hume characterized it, "to change the money they had in
charge from funded to unfunded debt." He said the Commissioners had
paid thirty-five millions sterling from 1817 to 1838, for the purchase
of Stock and Exchequer bills, and had received from the sale of Stock
and Exchequer bills seventeen millions, leaving more than a similar
amount then standing in their names. He urged, "that as the whole of
the deposits were by law payable in cash, and that as sums under
10,000_l._ could be demanded in five days, and even larger sums at
fourteen days' notice, the public might in a time of panic, such as
they had recently passed through, legally make demands of cash, and so
produce a heavy loss to the Government, and greatly inconvenience, if
not endanger, public credit." He gave a recent example, taking five
months of the year 1832, when the country was at its greatest height
of political ferment. The money transactions of the English Savings
Banks in
Deposits. Withdrawals.
£ £
March 1832 were 46,841 93,947
April " 33,447 107,534
May " 28,345 114,677
June " 25,515 368,976
July " 47,574 140,682[43]
_The Chancellor of the Exchequer_, who at the time of which we are
speaking was Mr. Spring Rice (the late Lord Monteagle), was quite
unwilling to take the course recommended by Mr. Hume. He was sure it
would tend to shake the security of the deposits, to which the loss
which Mr. Hume had spoken of was a mere trifle. He admitted, however,
that if Parliament could have foreseen the extent to which Savings
Banks would so soon have arrived, wiser arrangements would undoubtedly
have been made. People certainly did not want all the inducements to
save their money which it was once thought they did require. Still, he
was not for changing the rate; Government paid more than they received
as interest, but he declined to argue the matter as a mere money
question. Mr. Hume might say that depositors cared more for security
than interest, but he (the Chancellor) said, that if they reduced that
interest, the depositors would rush to take out their money. Nor did
Mr. Rice speak without the book. He produced a paper in which was
described the effect of the various commercial and political panics on
Savings Banks, and in distinction to this the result of the reduction
of the rate of interest in 1828. So far as it went, the Return is
conclusive and instructing.[44] In the commercial panic of 1825, the
total amount withdrawn was 361,000_l._; in the political panic of
1832, 550,000_l._; in 1828, when the interest was reduced by 14_s._
per cent., no less a sum than 1,500,000_l._ was withdrawn. The
Chancellor would not say that under no possible circumstances should a
reduction take place; a time might come when it might be done wisely
and discreetly, though he believed it would never take place without
creating some degree of uncertainty and risk. The depositors in
Savings Banks were not the class to be experimented upon, and he would
not have it said of him by persons out of doors that he had commenced
reductions in the public expenditure by cutting down the interest
payable to the poorer classes, who, after all, he believed, were the
principal investors in Savings Banks. One other little item of
statistics Mr. Rice gave before he sat down, which is very
interesting, and much more convincing than his other arguments. He
gave, from a Return which we have not been able to find, the amount of
interest which had been paid _in money_ since the establishment of
Savings Banks and, on the other hand, the interest which had been
credited to depositors _and made into principal_. In the former case
it was 286,000_l._; in the latter, or interest made principal, it was
9,271,000_l._ Finally, the Chancellor believed, that to pay depositors
interest at the rate of the value of money in the market would be a
death-blow to Savings Banks altogether! If Mr. Hume, in his pursuit of
economy, tried to enforce it by dividing the House on the subject, his
duty would be to resist. _Mr. Goulburn_, as the spokesman of the
Opposition on financial subjects, condemned the proposition as likely
to cause distrust amongst all classes connected with Savings Banks. So
far from thinking that the interest ought to be reduced, or could be
reduced, with safety--and this remark is curious, viewed in the light
of subsequent events--"it was only by great care and good management
on the part of those who superintended such banks" that expenses could
be paid. Time, however, works wonders, and among other things, brings
its revenges. The financial reformer, who from the first had the best
of the argument, had not long to live to see a change, and to find
that change brought about under the direct auspices of one who only
six years before, in the words just quoted, had strenuously opposed
his motion. We must leave Mr. Goulburn's bill of 1844 to be described
in a subsequent chapter.
[28] Mr. Rose's exertions in this respect were only ended by his
death, which took place in January, 1818, at the age of
seventy-four. "His whole life," says a contemporary, "was the
continued and strenuous effort of a powerful mind to promote the
welfare of the state and the happiness of his fellow creatures."
In contrast to this testimony, which cannot be called exaggerated,
we might refer to William Cobbett's bitter tirades against Mr.
Rose, which, indeed, may with some readers form the most
convincing evidence of the merits of the statesman. In Cobbett's
"New Year's Gift to Old George Rose," published in the _Register_
of 1817, and to which choice production we shall again refer,
there is an elaborate and embittered attack upon the latter, in
the course of which Cobbett stated that the amount of the
sinecures which Mr. Rose and his sons held would furnish ample
funds for all the Savings Banks then in existence.
[29] From a bare record of the debate in question to be found in
_Hansard_. Third Series. 1816.
[30] Act 57 George III. c. 130.
[31] _Hansard's Debates_, vol. xli. page 1392.
[32] This cognomen was given to Mr. Duncan more than once in the
House of Commons about this period.
[33] _A Letter to W. R. K. Douglas, Esq. M.P. on the Expediency of
the Bill brought by him into Parliament, occasioned by a Report of
the Edinburgh Society for the Suppression of Beggars._ By the Rev.
Henry Duncan, of Ruthwell. 1819.
[34] 1 George IV. c. 83.
[35] 5 George IV. c. 62.
[36] We shall see subsequently that this loss was more than made up
in other ways.
[37] _Times_, March 13, 1828.
[38] 9 George IV. c. 92.
[39] The barrister appointed, under clause 92, was Mr. John Tidd
Pratt, who still holds the office after a lapse of thirty-six
years. Under a subsequent clause of the same Act there was power
given to the Commissioners to appoint an umpire in cases of
dispute, and Mr. Pratt was likewise appointed to decide in these
cases on behalf of the Government. Mr. Pratt's name is now
properly and deservedly connected with all questions relating to
Savings Banks. From time to time this gentleman's intimate
acquaintance with the legal history and working of these and
kindred societies has gained him other appointments in connexion
with them. By the Act of 7 & 8 Victoria, c. 83, he had additional
powers conferred upon him, this Act setting forth that all cases
of dispute should be referred to him in the first instance,
without the necessity of each party appointing an arbitrator. In
1846, under the 9 & 10 Vict., he obtained the appointment of
Registrar of Friendly Societies, an office which he still holds;
and in 1861, on the establishment of Postal Banks, he was
appointed Consulting Barrister. Mr. Pratt was born in 1798, and
called in 1824 to the bar at the Inner Temple.
[40] _Times_, April 17, 1833.
[41] _Hansard_, vol. XVII. Third Series. 1833.
[42] 5 & 6 William IV. cap. 57.
[43] _The Westminster Review_ of this period thus refers to Mr.
Hume 's motion for a reduction of interest rate for Savings Banks:
"We are ignorant of any good reason why the public should receive
these deposits on other terms than those which would be settled
between individual and individual in a common mercantile
transaction. Admitting to the full importance of giving
encouragement to economical habits, we deny that the payment of
bounties is necessary for such a purpose, or that more is
requisite than to extend to the parties that superior
accommodation and greater security for investment which it is in
the power of Government to afford. This should form an inducement
adequate to every salutary purpose. All that is given as interest
beyond the market price of money is simply a premium upon fraud."
Vol. IX. Old Series.
[44] But it did not go far enough; the years 1826 and 1831 are the
years which ought to have been taken.
CHAPTER IV.
ON THE PROGRESS OF SAVINGS BANKS UP TO THE YEAR 1844.
"They to whom this subject is indifferent may censure our
minuteness; but those who, like us, regard the
establishment of Savings Banks as marking an era in
political economy, and as intimately connected with the
external comfort and moral improvement of mankind, will be
gratified to trace the rise and progress of one of the
simplest and most efficient plans which has ever been
devised for effecting these invaluable
purposes."--_Quarterly Review._ 1816.
Arrived at the year 1841, when Savings Banks have had a legislative
existence for a quarter of a century, it may be well to stop and pass
the period in review; to endeavour to show the progress made by these
institutions during this time; and to exhibit, so far as we are able,
their effect upon the general progress of the country. We have up to
this point dealt principally with the legislation on Savings Banks,
and have taken little account of what was said or done with respect to
them out of Parliament, after the year 1817. At this early period
there were frequent and warm discussions out of the House as to their
value and utility. When they first began to attract public attention,
"the friends of the working classes" were nearly equally divided
between their advocacy of them and the Friendly Societies. When Mr.
Rose, who had strongly advocated the formation of these societies, saw
the benefit that Saving Banks were calculated to render to the poorer
classes, he cordially took up their advocacy; and although he urged
that there was scope enough for all societies which inculcated the
duty and practice of providence and frugality, he was loudly accused
of leaving his first love, and advocating the Savings Bank plan for
some political purpose. We cannot give the reader a better idea of the
way the industrial classes were beguiled, and the kind of influence
which was only too often brought to bear upon them at this period,
than by giving some extracts from a paper to which we have previously
incidentally referred. In his "New Year's Gift to old George Rose,"
Cobbett reminds Mr. Rose, that after all he had done for them, he had
at length "left Friendly Societies in the lurch, and taken to _the
bubble of Savings Banks_." Cobbett, however, said that he could see
through the change, and he shows the amount of his penetration by such
argument as the following:--In "friendly societies Mr. Rose found that
'the members got drunk and _talked_--the naughty rogues.' Yes, and
even politics too! And it might have been added," continues the writer
and proprietor of the _Register_, "that they very frequently heard one
of their number read--the _Register!_" The object of Savings Banks, or
at any rate, parliamentary interference with them, was nothing else,
Cobbett considered, "than to get the pennies of the poor together, but
to keep their owners asunder." "What a bubble!" repeats Cobbett. Then
addressing Mr. Rose in the first person, he tells him how, in his
opinion, "the company of projectors who, in the reign of George the
First, wanted a charter granted to them for the purpose of making deal
boards out of sawdust, just saves you from the imputation of having,
in the Savings Bank scheme, been the patron of the most ridiculous
project _that ever entered into the mind of man_." Another person of
Mr. Cobbett's stamp, though one who aspired to greater knowledge of
all questions connected with trade and currency, and who really paid
closer attention to such subjects, was Mr. Thomas Attwood--"Currency
Attwood," or "Little Shilling Attwood," as he was variously designated
in some parts of the country. Whenever he could get an opportunity in
Parliament to speak of Savings Banks, we have seen that he invariably
clothed his ideas in a vocabulary of prejudiced invective. And he
repeated himself outside the walls of the House whenever he had the
chance. "Savings Banks," we find him saying on one occasion, "besides
costing the nation so much, were a nuisance;" "Savings Banks were a
sort of screw in the hands of the Government to fix down the working
classes to the system." On these expressions, and others of a like
tendency, as texts, those minor demagogues who went "on stump,"
preached for many a day. Considering how such men treated the
institution of Savings Banks, it is wonderful that they progressed as
they did. That they kept many from using these institutions is beyond
a doubt. Such men had a surprising power over the labouring classes,
and though that power was often used for good, too often it only
excited distrust and apprehension when distrust and fear were least
needed and most dangerous. The true friends of the poor--and there
have been many such at all times--said, in effect, "We have reason to
believe that much money now spent unnecessarily might be saved for
seasons of want and old age, if the poor had the means offered them of
putting that money by easily, safely, and profitably. We have exerted
ourselves to get such places established, we give our best exertions
to have them conducted properly, and we advise all who have money to
spare to intrust it to this safe keeping." Cobbett, on the other hand,
put his printers to work to say "What a bubble! At a time when it is
notorious that one half of the whole nation are in a state little
short of actual starvation--when it is notorious that hundreds of
thousands of families do not know when they rise where they are to
find a meal during the day--when of the far greater part of the whole
people much more than half of them are paupers; at such a time, to
bring forth a project for collecting the savings (!) of journeymen and
labourers _in order to be lent to Government_, and to form a fund for
the support of the lenders in sickness and old age!"[45] It would be
idle to show the fallacy of such reasoning, even admitting the facts
of the case to be as they are here stated. Suffice it to say, that in
this way did such men pander to the prejudices of the uneducated. Many
thousands of industrious workmen who had had no training, and who
could not discriminate between real and imaginary evils, were thus too
often flattered into believing that they had more than their share of
the truth, honesty, and manliness of the age on their side, and that
the upper classes were against them on every side and in all respects.
All this is pretty well over now.[46] Just as the sun expels the mists
of the morning, so have education and a free press opened the eyes of
the people to their true interests, and shown them which class of men
have most wished for and best worked to promote these interests.
It was not, however, only by such men as Cobbett that Savings Banks
were misinterpreted and misrepresented. Like every other new and
untried measure, it had to run the gauntlet of an educated as well as
an ignorant opposition. It was a very usual thing to find the
discussion on the utility of Savings Banks waxing warm in the most
important organs of public opinion. For example, the _Times_ newspaper
early took a decided stand against Savings Banks, and tried to
maintain its position, as we shall see more fully subsequently, long
after the country had given them a pretty unanimous verdict of
approval. Just after the period of which we are speaking, a
correspondent in the then, as now, leading journal, thought himself
able to trace in Savings Banks, "a great source of mischief; and that
to them,"--though in what manner it is not attempted to be
proved,--"may be attributed a considerable portion of the distress
which has been so long felt, and which does not appear to diminish in
most of the manufacturing districts." "God forbid," ejaculates this
remarkable genius, "that I should desire to encourage improvidence
amongst any portion of society; but there is a wide distinction
between parsimony and extravagance, and these banks have literally
made misers, and held out a bonus for them to become so." But even
this is not all: the same spirit, says our authority, which actuates a
man in becoming a miser, will operate to prevent their making use of
their petty accumulations. "With the habit of parsimony the mind
becomes degraded, and the workhouse or an application to the
dispensers of parochial relief lose their horrors." It is almost
useless, seeing that now few could be found to advocate such views, to
reply to them. They are based on the assumption, which we take to be
utterly erroneous, that a poor man is less at liberty to lay out his
mite at interest than his richer neighbour; or that if he did so, the
step was more likely to lead to his becoming a miser than his
wealthier neighbour who had all his money in the funds. It is less
necessary to argue the point, inasmuch as the aim of this nonsense is
made quite apparent by the writer concluding with an elaborate
eulogium on Benefit Societies for working men. "They could there,
provide," says he, "at a very trifling expense, against sickness, want
of employment, and numerous other casualties; while, on the other
hand, there would be no need to deprive themselves of the common
necessaries of life in order to add to their hoard." But here again
the fallacy of the argument is clearly apparent. The allowance from a
Benefit Society, then as now, in case of sickness or distress, would
be, generally speaking, quite inadequate to the circumstances
requiring it; and how could it possibly be more likely that a person
in this situation would be more independent of parochial relief than
one who had a fund of his own to look to, or perhaps a livelihood at
his command. Such warfare as this went on uninterruptedly for several
years; the advocates of Benefit Societies running down Savings Banks,
and _vice versá_, not in all cases seeing that the two might exist
together, and that each was well calculated to supply a want which the
one or the other class of institutions did not meet. There can be no
doubt, however, which institution suffered most from these
discussions. The most decisive proof of the improvement which was seen
in the condition and the habits of the labouring classes during the
first quarter of the century was the progress of Benefit Societies
from 1802 to 1820. In the former year there were 9,622 of these
societies; in the latter year there were nearly five times that
number. The people during this period had not improved in comforts and
conveniences as they did subsequently; they progressed in the more
skilful use of the same, or even diminished means. These societies
made a deep impression upon the population, and in the same proportion
the people were recovered from the control of their appetites and
passions, and from that propensity to use without restraint those
means of immediate gratification which distinguishes all ignorant
people of whatever rank. Notwithstanding all this, the Friendly
Societies were beset with difficulties, and in the discussions to
which we have alluded their opponents made the most of them. Perhaps
the well-meaning might better have assisted the poor in instructing
them how to reform the management of these societies, and by showing
them the principles upon which they could be most safely established.
However it was, there can be no question that, either from their
inherent defects or the comparison of the benefits to be derived from
the one as against the other institution, Savings Banks soon took the
place of Benefit Societies in the public estimation, and progressed
when, comparatively speaking, the latter declined. In the evidence
given by Mr. Lloyd, the founder of the Hertford "Sunday Bank," before
the committee on the Poor Law previously referred to, he assigned as
one of the causes which had promoted the success of Savings Banks the
evils arising from Benefit Clubs or Friendly Societies, as then
constituted. "There is always," he said, "a regulation, that when
two-thirds of the members choose to assemble and agree to break up the
club, they can; the consequence is, that the other one-third, the old
members, who ought to be deriving an assistance during the last period
of their lives from these clubs, are deprived of it." He had known six
clubs which had been broken up in this way. The following extract from
a report of a committee which was appointed to investigate the rival
claims of Benefit Societies and Savings Banks so admirably sums up the
whole argument, and says so much with reference to both institutions
which is no less true now than then, that we feel confident our
readers will not object to have it reproduced here.[47] "Benefit
Societies have done much good; but they are attended with some
disadvantages. In particular, the frequent meetings of the members
occasion the loss of much time, and frequently of a good deal of money
spent in entertainments.[48] The stated payments must be regularly
made; otherwise, after a certain time, the member loses the benefit of
all that he has formerly paid. Nothing more than the stated payments
can be made, however easily the member might be able at the moment to
add a little to his store. Frequently the value of the chances on
which the societies are formed, is ill calculated; in which case,
either the contributors do not receive an equivalent for their
payments, or too large an allowance is given at first, which brings on
the bankruptcy of the institution. Frequently the sums are embezzled
by artful men, who, by imposing on the inexperience of the members,
get themselves elected into offices of trust. The benefit is distant
and contingent; each member not having benefit from his contributions
in every case, but only in the case of his falling into the situations
of distress provided for by the society. And the whole concern is so
complicated, that many have hesitation in embarking in it their
hard-earned savings. With such disadvantages who would not rather
choose the simple, secure mode of investment offered by the bank--free
(as the banks were at that time) from them all? But if they must have
the Benefit Society, with its contingent and distant benefits, working
men should not rest here. Thousands of the working classes could well
afford to pay their weekly sums to secure their sick and burial money,
and yet have enough to spare to provide against the other rainy days
of their life. A poor man's savings are continually liable, while in
his own custody, not simply to professional thieves, but also--and
there is far more danger of it--to be pilfered by himself and his
family. They are often lost by being intrusted to improper hands; they
are still oftener worse than lost in the ale-house or the gin-palace,
and the money which properly taken care of might give the means for
occasional enjoyments of a harmless kind, providing for the legitimate
wants of his children, or which might support all during the
intermissions of employment to which all are exposed, may be worse
than squandered."
It was thus that the institution of Savings Banks lost, by being cried
down by the leaders of the people, and by the discussion which
continued as to their merits; and thus that they gained, by a close
comparison with the kindred institution of Friendly Societies. The
loss, however, was but temporary. In ten years from the date of their
legal formation the deposits in Savings Banks amounted to upwards of
sixteen millions sterling, and this sum had been contributed by no
fewer than four hundred thousand persons. A writer of the period
characterizes the progress made by institutions such as these "as one
of the most striking manifestations of virtue that ever was made by
any people;" and he seems to have had some good grounds for the
opinion. "For persons merged in poverty and totally deprived of
education, as the English population have heretofore so generally
been, it is not easy or common to have much of foresight, or much of
that self-command which is necessary to draw upon the gratifications
of the present for those of a future day." And though, as we have
previously seen, the money here deposited could not have been put
there by persons exclusively of the industrial class, yet it is clear
that many of the labouring community did possess means beyond what
were needed to procure them the necessaries of life, and that these
institutions exactly met the want which was felt in not having the
means to safely dispose of that little surplus, and to call it in when
the need arose for it. The year 1827 was the year, it will be
remembered, after one of the most terrible financial crises that this
country has ever passed through, and yet, though the average amount of
money deposited in Savings Banks in one year before this time had only
been about 1,100,000_l._, no less a sum than 859,734_l._ was deposited
in 1827, and not half of that sum was withdrawn. These facts show the
great hold which Savings Banks had already taken upon the country. Of
what service they were during such times as those witnessed in 1826 we
shall have to speak. We are far from anxious to trouble the reader
with any statistical information which might easily be withheld, but
the progress of which we are now speaking can be best traced by
presenting first, a tabular view, which gives that progress from year
to year, and which will likewise furnish material for remark.[49]
TABLE 1.
Showing the Amounts invested by Savings Banks with the
National Debt Commissioners from 1817 to 1841, with the
Total Capital of all the Banks at the end of each year:--
+-------------+-----------------------+--------------------+
| Year ending | Total amount | Total Capital at |
| 20th Nov. | credited to Trustees, | the close of each |
| | including Interest. | year. |
+-------------+-----------------------+--------------------+
| | | |
| | £ | £ |
| | | |
| 1817 | 231,028 | 231,028 |
| 1818 | 1,533,812 | 1,697,853 |
| 1819 | 1,233,684 | 2,813,023 |
| 1820 | 807,825 | 3,469,910 |
| 1821 | 1,312,800 | 4,740,188 |
| 1822 | 1,849,264 | 6,546,690 |
| 1823 | 2,205,272 | 8,684,662 |
| 1824 | 3,149,151 | 11,720,629 |
| 1825 | 1,769,988 | 13,257,708 |
| 1826 | 1,131,659 | 13,135,218 |
| 1827 | 1,475,250 | 14,188,708 |
| 1828 | 1,734,374 | 15,358,504 |
| 1829 | 960,142 | 14,791,495 |
| 1830 | 1,056,584 | 14,860,188 |
| 1831 | 1,037,629 | 14,698,635 |
| 1832 | 1,099,368 | 14,416,885 |
| 1833 | 1,448,751 | 15,324,794 |
| 1834 | 1,575,016 | 16,386,035 |
| 1835 | 1,654,896 | 17,469,617 |
| 1836 | 2,006,588 | 18,934,591 |
| 1837 | 1,649,691 | 19,711,797 |
| 1838 | 2,200,663 | 21,446,341 |
| 1839 | 2,137,502 | 22,486,553 |
| 1840 | 1,949,126 | 23,549,716 |
| 1841 | 1,950,751 | 24,536,971 |
+-------------+-----------------------+--------------------+
Remembering that this table does not give the actual business done by
Savings Banks within this period,--which, indeed, from the absence of
proper returns in the earlier years of those Banks it would be
difficult to present,--many instructive lessons may be gathered from
it as to their value and utility. In fact, however, and for all
practical purposes, the amounts remitted by the Trustees to the
National Debt Office very fully represents the progress of Savings
Banks, for they may be considered as representing so much surplus
every year, after all the claims on the banks had been met. The
variations observable in the returns are accounted for quite easily by
the state of the country at the time. When the amount falls, it may be
taken for granted that the country is passing through a period of
exceptional suffering and trial, and that the funds which have been
patiently accumulated for times of need are thus made available when
the necessity arises for it. The country was unusually prosperous, for
example, in 1823-4, and an enormous surplus was returned. In 1825, as
if to mark the coming storm, there is a heavy fall in deposits. In
1826, the tables were turned, not only in a figurative, but, so far as
we are concerned, in a literal sense. The circumstance can be only too
well explained. The _Quarterly Review_ of that time gives a glowing
account of the increased wealth of all classes, especially those of
the trading community.[50] "The increased wealth of the middle classes
is so obvious, that we can neither walk the fields, visit the shops,
nor examine the workshops and storehouses, without being deeply
impressed with the changes which a few years have produced. In the
agricultural districts we do not, indeed, see such great strides, but
we see universal advancement." Then we have the familiar record of the
exportation of gold; of the Bank of England and provincial banks
deluging the country with notes.[51] Money became so abundant that a
terrible rage for speculation set in; joint-stock companies with
unlimited liability were projected for every imaginable object. On the
reorganization of the South American republics, which had just then
been effected, all sorts of proposals for mines were started; the El
Dorado had to be found now, if ever.[52] In the session of 1825, 438
petitions for private bills were presented, and 286 private acts were
passed. The King, even, was so deceived by the general appearance of
things, or was so purposely blind to their real state, as to
congratulate the country, in July, 1825, on "the prosperity everywhere
pervading the country." The time arrives when anxious speculators
begin to look out for some return for their money; they are told that
their capital cannot possibly realize so soon; then the bankers are
besieged, but, tempted by the abundance of money, they had discounted
bills at long dates to an enormous extent, and lent money upon
securities which were presently seen to be almost worthless. Then came
the panic,--and then the crash. Commercial houses first failed, big,
substantial firms, which were supposed to have the wealth of Croesus
at their back, came down thunderingly. "Many a firm of unimpeachable
honour and unquestionable solvency was compelled to bend before the
storm." Then came the turn of the great banks: they had advanced their
money to the merchants, and now that the security had failed, they
also must bend before the blast. On the 5th of December, the news
spread with the wings of the wind, that the banking house of Sir Peter
Cole and Co. had failed; next day, Williams and Co. stopped payment;
and from that time, without intermission, seventy country banks went
down within six weeks.[53] How things were restored to their original
condition, and how promptly the Government acted during the terrible
panic, we need not stay to tell. Savings Bank deposits fell from about
three millions in 1825, to less than half that sum in 1826. More money
was withdrawn in the year of the panic than had been withdrawn
altogether since the year 1820. It is not a little curious, as showing
that depositors in Savings Banks are less inclined to speculation than
other classes, to point out, that during the panic a sum equal to at
least fourteen millions sterling must have been safely lodged in the
different provident banks of the country; and that little money was
hazarded in the speculations of the time is evident from the fact that
only one-tenth part of the whole amount of deposits was withdrawn to
supply emergencies. In this way were those people rewarded who
preferred a safe deposit with a reasonable interest to "cent. per
cent." and unlimited risk.
Nor can we stop to describe the result of the panic on the industrial
classes. The picture of that terrible time has often been drawn, when
thousands of hungry, infuriated men, roused by the sorest distresses,
went about robbing shops, breaking machinery, rick-burning, chased by
the constabulary, and fired upon by the soldiery. The time was a most
disastrous one, but it was full of lessons for all classes. Many of
the provident poor suffered little, and never had anything to fear, on
account of having prepared themselves for such calamities. Those of
the poor who acted less wisely, and ventured their little surplus in
some speculation or other, met with few condolences. When a portion of
them petitioned the House of Commons for relief, they were rather
roughly told that they ought to have deposited their earnings in
Savings Banks. It was on this occasion that Sir Robert Peel replied to
this taunting, and recognised the imperfections of the existing
machinery, by asking, indignantly, how the House could expect this to
be done in cases where "the Savings Bank was perhaps twenty miles from
the working man's home."
To return again to the table. In 1827 and 1828 the accounts show a
much more healthy state of things, and it is clear that the deposits
are steadily gaining their natural ascendancy over the withdrawals,
when there is another rebound, of a greater magnitude than ever; the
withdrawals not only exceeded the deposits of 1829, but the deposits
of 1830 added thereto. There can be no question that, primarily, the
Savings Bank Act of 1828, which came into operation on the November of
that year, and under which the amount of interest allowed on deposits
was reduced by 14_s._ per cent., was the cause of this exceptional and
most important change. Like all misfortunes of this nature, it had its
bright side, and was far from being an unmixed evil. As we have
already endeavoured to show, a large number of depositors up to this
period belonged to classes much above the artisan class; and as the
former looked more to the interest given, while the industrious
classes thought most of the security offered, it is no wonder and no
calamity that the connexion which the higher classes had formed with
Savings Banks was now dissolved. Henceforth, the returns may be looked
upon as more than ever the result of habits of economy and thrift, and
as representing the surplus money of the artisan and the lower
portions of the middle classes.
The year 1830 shows that confidence was slowly returning, when again
there is a period of great depression. Two millions of capital is
withdrawn in 1831-2, over and above the deposits of those years, to
meet demands on the banks. The political agitation of those years
sufficiently accounts for this state of things. It will require little
to be said in order to show that a time like that was likely to tell
largely against such institutions as those under consideration. The
time was one of great anxiety among all classes, and amidst the
uncertainties and anticipations which followed in rapid succession, it
would be only bold people, and those of more than average intelligence
and power of mind, that could confide, without the smallest degree of
wavering, in the stability of the country. We had a turbulent
population at home, and amidst much agitation for their undoubted
political rights, there were many clamouring for bread, many
clamouring for work, and thousands for they knew not what: and France
offered an illustration of what might possibly happen. With such
manifest agitation everywhere, with funds falling, and the entire
political sky lowering, there cannot be much wonder that many waited
patiently for some issue before they trusted to resources other than
their own. Not only were actual hardships endured during this great
crisis in our history, but the working classes brought hardships upon
themselves. Led by intemperate and impracticable men, many thousands
of the more ignorant beguiled themselves into believing that the
Reform Bill would do everything for them, and they would need to do
nothing; that every man would be forced into independence and
competence whether he would or no; that taxes would be repealed; and
that in this new state of society there would no longer be any need of
that spirit of striving which is at the bottom of all true schemes of
social progress and advancement. This period over, many illusions were
dispelled, many useful lessons learnt. Under somewhat fairer and
happier auspices, society settled down into its old ruts again, only
too thankful in many cases that the old ways were still open. After
the year 1832, the progress of Savings Banks continued to be eminently
satisfactory. There was a transitory cloud in 1837, and another in
1839, caused by exceptionally hard times, such as a bad harvest and
scarcity of food, and distress in the manufacturing districts caused
by unusual reverses in trade, when again the funds laid by came
opportunely in aid; but, with these exceptions, the Returns furnish no
further grounds for remark. We will therefore proceed to give a small
table, which, without giving the details of each year, shows in a
clear light the progress made by the banks at the expiration of three
quinquennial periods.
TABLE 2.
From 1825 to 1840.
+--------------+-------------+--------------+-------------------------+
| | Number of | Total Amount | Increase. |
| Year ended | Depositors. | of Deposits +------------+------------+
| | | from 1817. | Depositors.| Deposits. |
+--------------+-------------+--------------+------------+------------+
| | | £ | | |
| 20 Nov. 1825 | 358,160 | 13,769,988 | --- | --- |
| 20 Nov. 1830 | 430,166 | 15,739,907 | 72,096 | 1,969,919 |
| 20 Nov. 1835 | 587,488 | 17,705,228 | 157,322 | 1,965,321 |
| 20 Nov. 1840 | 824,162 | 22,915,940 | 236,674 | 5,200,712 |
+--------------+-------------+--------------+------------+------------+
Taking the year 1841, on account of the facilities for calculation
afforded by the census of that year, we find that up to the 20th of
November, 1841, the total number of Savings Banks in the United
Kingdom was 555, of which 428 were in England, 23 in Wales, 76 in
Ireland, and 28 in Scotland. The smallness of the number of Scotch
banks is accounted for by the popular character of the private banks,
and the fact that until within six years of the period we have
reached, or 1835, none of the acts relating to Savings Banks had any
reference to Scotland. The average amount of each deposit in 1841
was--in England about 30_l._; in Ireland 29_l._; and in Scotland
12_l._ The total number of depositors in England as compared with the
population of 1841, was one to every 22 inhabitants, in Wales 1 in 58,
in Scotland 1 in 52, and in Ireland 1 in 103.
One of the most positive proofs of the increase in the provident
habits of the people between 1828 and 1844 is to be found in the
increase of the number of small depositors. In 1828 the number of
depositors in Savings Banks who had not subscribed more than 20_l._
was 203,604. In 1844 they had increased to 564,642, or nearly three
times the number.[54] The amount of the deposits in the first instance
was 1,473,389_l._; in 1844 it reached 3,654,799_l._ One writer,
overlooking the fact that the increase here spoken of was a gradual
one year by year, has endeavoured to trace the effect of the decrease
in the amount of large deposits and the increase of the number of
small ones to the operations of the Act for the Amendment of the Poor
Law in 1834. There can be no question that this act supplied motives
for economy, and operated in increasing the number of provident
people; but in view of the fact that the increase in the number of
depositors between 1833 and 1834 was exactly in proportion to the
increase between 1834 and 1835 or 1835 and 1836, it is quite as
proper, and we submit more so, to speak of Savings Banks operating
beneficially upon the Poor Law, as that the Poor Law Amendment Act
increased in this way the efficiency of Savings Banks.[55]
What assistance these Savings Banks must have rendered during the
crises through which the people passed between 1817 and 1841 may be
judged by the use made of them. But we think we see more in Savings
Banks than that they enabled many in times of hardship by a wise
foresight to escape much that others suffered. We see in the progress
of these banks undoubted evidence of the increasing prosperity of the
country, in relation at any rate to the poorer classes; and they were
among the direct agents in creating that prosperity. Savings Banks
created and then fostered habits of economy and frugality, and every
man won over to the pursuit and practice of these habits increased the
sum of the prosperity manifest during the period we are considering.
Perhaps we can make the position we here take up more clear from the
following table,[56] carefully compiled from the best sources of
information on such subjects, and which we think is calculated to show
the good influence of Savings Banks in a somewhat new and striking
light.
TABLE 3.
Showing the Increase in the Deposits of the Savings Banks in each
English[57] county, between 1834 and 1841, and the Decrease in the
Poor Rates during the same period:--
+--------------+----------+----------+---------+--------+-------------------+
| | | No. of | |Increase| Expended in |
| County. |Population|Depositors| Amounts | of |Relief of the Poor.|
| | in |in Savings| of |Deposits+---------+---------+
| | 1841. | Banks in | Deposits| since | in | in |
| | | 1841. | in 1841.| 1834. | 1834. | 1841. |
+--------------+----------+----------+---------+--------+---------+---------+
| | | | £ | £ | £ | £ |
|Bedfordshire | 107,937| 3,584 | 111,526| 35,016| 77,819 | 41,063 |
|Berkshire | 160,226| 12,020 | 359,676| 64,152| 100,183 | 74,708 |
|Bucks | 155,989| 4,657 | 128,025| 61,140| 124,200 | 74,007 |
|Cambridge | 164,509| 3,831 | 121,777| 24,423| 96,497 | 72,158 |
|Chester | 395,300| 15,302 | 554,400| 89,325| 92,640 | 77,698 |
|Cornwall | 341,269| 12,915 | 492,013| 101,980| 93,037 | 85,063 |
|Cumberland | 197,912| 7,538 | 211,741| 65,313| 43,067 | 36,867 |
|Derby | 272,202| 10,099 | 321,897| 84,964| 72,721 | 55,238 |
|Devon | 533,731| 49,866 |1,492,072| 289,154| 210,825 | 195,402 |
|Dorset | 174,743| 11,470 | 412,628| 110,350| 84,293 | 80,097 |
|Durham | 324,277| 7,023 | 201,354| 17,596| 79,399 | 66,639 |
|Essex | 344,995| 14,413 | 428,202| 86,941| 239,946 | 170,356 |
|Gloucester | 431,307| 25,526 | 818,157| 190,324| 161,449 | 130,321 |
|Hereford | 114,438| 8,350 | 211,251| 41,430| 56,683 | 43,512 |
|Hertford | 157,237| 3,785 | 113,425| 1,195| 85,799 | 61,250 |
|Huntingdon | 58,699| 1,765 | 52,001| 13,594| 35,884 | 25,329 |
|Kent | 548,161| 33,392 | 945,273| 219,416| 343,878 | 208,786 |
|Lancaster | 1,667,064| 65,402 |1,980,143| 369,473| 253,405 | 260,227 |
|Leicester | 215,855| 6,803 | 173,581| 31,329| 100,857 | 70,423 |
|Lincoln | 362,717| 18,451 | 497,509| 82,035| 161,074 | 103,894 |
|Middlesex | 1,576,616| 176,849 |4,521,589| 598,329| 582,412 | 435,606 |
|Monmouth | 134,349| 3,099 | 76,651| 23,416| 27,626 | 24,819 |
|Norfolk | 412,621| 18,336 | 527,300| 162,298| 306,787 | 182,229 |
|Northampton | 199,061| 8,410 | 243,600| 29,157| 140,179 | 86,148 |
|Northumberland| 250,268| 12,862 | 459,390| 69,321| 71,983 | 64,649 |
|Nottingham | 249,773| 15,763 | 420,345| 13,951| 66,030 | 57,721 |
|Oxford | 163,573| 10,246 | 285,713| 28,324| 80,616 | 76,474 |
|Rutland | 21,840| No Savings Bank. | 7,008 | 7,453 |
|Salop | 239,014| 16,452 | 557,190| 69,543| 84,493 | 57,571 |
|Somerset | 436,002| 22,019 | 679,072| 105,153| 176,286 | 157,022 |
|Southampton | 354,940| 23,942 | 687,473| 99,324| 203,466 | 142,507 |
|Stafford | 510,206| 15,368 | 452,306| 84,399| 120,512 | 95,242 |
|Suffolk | 315,129| 11,972 | 348,176| 89,939| 245,509 | 138,228 |
|Surrey | 582,613| 31,250 | 749,199| 159,068| 261,501 | 199,477 |
|Sussex | 299,770| 15,709 | 420,570| 84,190| 246,626 | 145,013 |
|Warwick | 402,121| 22,291 | 468,270| 93,168| 158,159 | 102,828 |
|Westmoreland | 56,469| 942 | 24,719| 1,920| 22,283 | 17,607 |
|Wilts | 260,007| 11,706 | 413,941| 97,140| 173,925 | 133,573 |
|Worcester | 223,484| 12,218 | 401,330| 53,978| 81,612 | 62,958 |
|Yorkshire | 1,591,584| 69,545 |2,105,866| 435,129| 418,742 | 372,166 |
+--------------+----------+----------+---------+--------+---------+---------+
In every county, as may be seen from this table, there is a decided
increase in the number and amount of Savings Banks deposits between
the two periods; and in every instance, except two, there is a decided
decrease in the amount spent on the relief of the poor. Not only so,
but taking the two exceptional cases, we find that in the one case, a
small county, there had not up to this time been any Savings Bank
established; and in the other instance, that of the large and populous
county of Lancaster,--which shows an increase instead of a diminution
on the two years in the amount of poor relief,--it is not less curious
that its industrial population have never patronised the Savings Banks
to the same extent, in proportion to their number and earnings, as the
same classes have done in the country generally. Further, the three
counties of Kent, Middlesex, and Norfolk, which in 1841 had the
greatest number of depositors in Savings Banks in proportion to their
population, also exhibit the pleasing fact of the greatest diminution
in the amount spent in the relief of the poor. It may be said that
many considerations ought to enter into such calculations as those we
are making, and that at best such statistics only prove that the same
causes, such as abundance of work, good harvests, &c., will contribute
to the increase of surplus funds, and the decrease in measures of
relief. But it must be borne in mind that prosperous trade does not
necessarily produce frugal people and provident habits, though it
often enough leads to unnecessary and vicious expenditure. By far the
greater part of the decrease in the sums given for relief is
unquestionably owing to the operations of the Poor Law Amendment Bill
already referred to, which Lord Althorp carried through Parliament.
Truly stigmatized before his time as "the great political gangrene of
England," the old Poor Laws of this country first made paupers, and
then promptly maintained them. It is, however, the relative proportion
in which the increase of Savings Bank deposits stood to the decrease
of the sums for relief that we wish here to impress upon the reader,
leaving him to form his own conclusions. And with all respect to those
who framed the measure of 1834, which was very beneficial to the
country and only just to the independent poor, we think the results
have been rather too much magnified. From the year 1820 we can plainly
trace a manifest improvement in the condition of the poor, and we have
not scrupled to ask for a place for the Saving Bank system among those
important agencies which have led to this improvement. Still, taking
the measures of Poor Law relief as a good criterion of their
condition, we find that the sum total paid for the ten years between
1811 and 1821 was 68,000,000_l._, giving a yearly average of
6,800,000_l._ In the ten years ending 1832, the amount of poor rates
was 62,900,000_l_., or a yearly average of about 6,200,000_l._ Thus we
have, in spite of what was considered the iniquitous system of relief,
and in spite of an increase of population amounting to 16 per cent., a
clear reduction of 5,000,000_l_. within ten years. The advancement is
still more clear, if we take the case of the large centres of
population, but this is perhaps, unnecessary.
The Returns, however, of the Registrar General may be supplemented by
Revenue Returns for the same period, from which the improvement in the
condition of the industrial classes may be made still more palpable.
In 1814 the consumption of tobacco was 15,000,000 lbs.; in 1832 it had
increased to 20,000,000 lbs., an augmentation of 31 per cent., while
the population only showed an increase of 24 per cent. during the same
interval. The amount expended upon articles which, like tobacco and
intoxicating drinks, are not, to say the least, of the first
necessity, forms no incorrect measure of the progress of the nation,
and of the ability of the people to bear the national burdens which
must be imposed. In 1814 the consumption of sugar was 1,997,000 lbs.;
in 1832 it amounted to 3,655,000 lbs., an increase of 83 per cent. to
be set against the above rate of increase in the population. The tea
consumed in 1814 was 19,224,000 lbs.; in 1832 it had increased to
31,568,000 lbs., or an increase of 65 per cent.; and coffee increased
from 6,324,000 in 1814 to 22,952,000 lbs., or an increase of 183 per
cent., in 1832. The increased consumption of such articles, (not
forgetting reductions in price,) was an evidence of nothing, if not of
the growing prosperity of the people. Such items show that the people,
as a mass, enjoyed a greater command over the comforts of life than
formerly. The rich man, of course, added little or nothing to his
ordinary consumption of the articles that were necessary to his
comfort or convenience, but with the poor it was very different. For
example, the amount of silk imported during the period of which we
have spoken varied but little, while the imports on the article of
cotton wool, the staple fibre of the masses, increased from
152,000,000 lbs. in 1820 to 259,000,000 lbs. in 1832, or an increase
of 70 per cent.[58]
Enough has been said, we hope, to show the gradual progress made in
these years in all that relates to the social advancement and
well-being of the people, and to what extent Savings
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