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Savings Banks

Volume 180: debated on Wednesday 14 August 1907

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I beg to ask Mr. Chancellor of the Exchequer whether, having regard to the fact that while it is on all hands admitted that the savings bank should be self-supporting, there are, at the present time, deficiencies in the capital accounts of the Post Office Savings Bank, the Trustees' Savings Bank, and friendly societies, estimated, in the absence of official balance sheets, to amount to at least £15, 000, 000; that the interest on the securities held fell short last year by £133, 000 of the united amounts of interest paid and working expenses; that while the banks are liable to the public for upwards of £200, 000, 000 they hold no reserve to meet claims; and whether, having regard to the foregoing facts, he will consider the advisability of appointing early next session a Select Committee to inquire into the whole question for the purpose of suggesting a means whereby the banks may be restored to a solvent condition.

The hon. Member's calculation of the capital deficiency rests upon the method of valuation of securities at current market price, which was condemned as misleading by the Select Committee of 1902. As regards the deficiencies of annual income of the Savings Banks Funds, it must be borne in mind that in the case of the Post Office Savings Banks the Exchequer has gained considerably more from the surpluses on that account in former years than it has had to provide to make good the deficiencies of recent years; while the deficiency on the Trustee Savings Banks Account last year was less than £10, 000, and is being gradually reduced.