CHAPTER IV.. On the Progress of Savings Banks Up to the Year 1844.

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!" 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. 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. "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. 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 1,100,000l., no less a sum than 859,734l. 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.

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. "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. 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. 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. 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 14s. 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 30l.; in Ireland 29l.; and in Scotland 12l. 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 20l. was 203,604. In 1844 they had increased to 564,642, or nearly three times the number. The amount of the deposits in the first instance was 1,473,389l.; in 1844 it reached 3,654,799l. 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.

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, 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 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 68,000,000l., giving a yearly average of 6,800,000l. In the ten years ending 1832, the amount of poor rates was 62,900,000l., or a yearly average of about 6,200,000l. 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 5,000,000l. 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.

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 Banks played a part on that advancement. Because these institutions have been proved to create frugal habits--in much the same way that the supply of intoxicating drinks creates in many cases a demand for them--as well as to give them direction and encouragement, we have endeavoured to prove their right to a foremost place among the many other mighty engines of civilization which have made Great Britain what it is. And now we must conclude this chapter with a less pleasant task, and refer briefly, at present, to two foes to Savings Banks, one without and one within, both of which had a very powerful effect as hindrances on the progress of these useful institutions. We refer to the doubts which began to be cast on the utility of Savings Banks by portions of the public press, and the serious frauds which now for the first time began to engage public attention. In 1844, when Mr. Goulburn's bill was under discussion and subsequently to that, several newspapers began to dispute that Savings Banks were either so useful or so wise as had been generally thought up to that period. The Times newspaper, with an hostility which Dr. Chalmers characterized as "most glaring" and "likely to mislead every artisan from the path of his true interests," laughed at and ridiculed the system long after it had proved its usefulness in numerous ways. That paper, which opposed the new Poor Law of 1834 with great bitterness, and had treated with manifest injustice other schemes for the social amelioration of the poor, devoted several editorial articles in 1844 to throw discredit on the institution of Savings Banks. The articles in question were calculated to work a mischievous practical influence on many readers, especially on those who gave little attention to the subject of political economy; they were meant to create a spirit of opposition to Savings Banks, but in many cases they must have had the opposite effect and failed to convince all who were not equally perverse. To show the kind of argument indulged in by the leading journal at a time when it was equally as now the greatest newspaper power in the land, when its rebuke or praise had a weighty effect on any important measure, and when Cabinet Councils debated whether it should be propitiated or defied, we need only give the following extracts:--

"A labourer sixty years of age has, by hook or crook, saved 500l. We know such a case. The 500l. is the plague of his life. It would be a mercy to swindle him out of it, except that he would probably feel a good deal at the loss. Could he forget it, he would be both a happier and better man. To begin with, it is a guilty possession. His father is maintained by a distant Union; his sons and daughters are all but forbidden his cottage. He invests it in secret.... When he dies his children will squander it, not in dissipation, but in the mere feebleness and incontinence of ingrained poverty."

Another extract striking at the root of all habits of providence and thrift:--

"When a labourer has saved 50l. or 100l. then the greatest difficulty comes: what is he to do with his money? He has caught a tartar. His usual course is a very natural one, because it is the first course that offers--to open a public house. He does so, and generally and happily loses his money. A labourer with 200l. in his pocket has a very fair prospect of the union workhouse before him. He is not commercial enough to open a shop, and small farms are obsolete. He may, to be sure, shut his doors against all his kith and kin, and buy a selfish annuity with the sum, which will just keep him while he rots and dies. But will he, and who is to advise him to do so?"

Granted that things are very different now to what they were when these remarks were penned, and that investments of any sort may now be made with comparative ease, it seems to us that the argument of the Times was based throughout on false assumptions; that it is a mistake to suppose that the primary or sole object of Savings Banks was to build up capitals for investiture in business or trade, and not for expenditure on the necessaries or comforts of life; nor to make every labourer a capitalist, in the usual acceptation of that term, but to enable him to end his days in some sort of independence, and in some degree of peace and comfort. Savings Banks at their establishment were, always have been, and still are, meant for accumulations, not to be traded with,--though, of course, there is no prohibition,--but always have had and still have a homelier aim. They are meant to inculcate the habit of laying by for an evil day, for old age, the winter of life, or as Dr. Chalmers, we believe, strikingly puts it, "for those mishaps and sicknesses which might be termed its days of foul weather." In such case the money will not be traded with, but in right season spent. The answers to some of the arguments of the Times are indeed so obvious that it seems superfluous even to state them. Money in hand is all the world over better than beggary. That the inculcation of such a principle will tend to fill our towns with paupers is monstrous absurdity. The object and design of Savings Banks are, of course, primarily, to seek to get hold of the surplusage of money in the hands of the poorer classes, to rescue it from vicious or unnecessary expenditure at the best seasons, in order to its forming a reserve for needful subsistence or additional comfort at another period. "A domestic servant," says another article of the Times, "at the age of fifty-five or sixty, finds she is incapable of further employment. She has saved 80l. Very creditable to her, of course, and very stingy she must have been to her nephews and nieces to have done so much. But what is she to do with her 80l.?... Across the Channel such a sum would be a mine of agricultural wealth. On this side the Channel it would be a snowball in the sun." This is, by the way, an extreme and unfortunate case, and one we would hope not often, in all the particulars, occurring. But were it frequent, surely 80l. in hand is better than nothing and an immediate resort to the parish. To say that the 80l. would always remain 80l. and would not melt away like snow before the sun, would be ridiculous; but if there be any virtue in self-reliance, and in self-dependence, it surely would not be ridiculous to say that that which enabled a woman to minister to her own wants in a greater or less degree, and in the same degree to rescue herself from becoming a burden upon other people, was, so far as it went, a solace and a blessing to her. Once, and only once more, the Times declared that "investing money in Savings Banks was mere hoarding," nothing more than the creating of misers.

"It is most melancholy to notice the few helps and encouragements to thrift and husbandry which our present condition allows the labourer. We tell him to save. We put it as the most indispensable moral duty; the great commandment of our law. We build prisons (sic) for those whom age or calamity have proved transgressors against it; yet, having laid this heavy burden upon the labourer, where is the 'little finger' of help contributed by society. We refer him to the Savings Banks and to Friendly Societies, i.e. we tell him to hoard his money, or to secure an annuity, on the chance of old age. There cannot be two modes of investment less interesting, less social, less suited to the condition of the mind of a labourer. Where it is practised, we can only say that it is an act of faith and prudence so dry, so pure, so transcendental, as to be above humanity, especially that very form of humanity found in the English agricultural labourer."

Here we think both arguments and facts are at fault. There can be no question that at this time there were many almost insuperable obstacles to the profitable investment of small sums. These obstacles, caused by the state of society and the tendency of legislation, especially on the distribution of land, have since been removed, and no longer influence the case. Why, however, the best should not be made of existing means is at least a fair question? People must save money--hoard it, if the term be liked better--before it can be used. It may be uninteresting and unsocial to save money instead of spending it, but people must do either the one thing or the other; and if they do the former, they at least know the value of a secure place of deposit where their money shall lie in safe and remunerative custody till it be needed. Then as to the facts. "The acts of faith and prudence," "so dry, so transcendental, &c.," were at that time, as at present, more frequent where the agricultural labourer is in strongest force than in almost any other part of the kingdom. In Dorsetshire--"poverty-stricken Dorsetshire," as it is called by the Times itself--the Savings Banks return for 1843 averaged more than 2l. a head for the entire population, while in Lancashire, with its highly-paid manufacturing population, it only averaged 1l. Nor is this a solitary instance. The rural population throughout the country are by no means the least frequent visitors to Savings Banks.

Far more important, however, in their disastrous results than those attacks from without, were the blows levelled at Savings Banks from within. There were now developed inside these institutions seeds of much mischief, which materially retarded the growth of Savings Banks in subsequent years, if not of the habits which the promoters of Savings Banks sought to engender and foster. The subject of Savings Bank frauds will belong to a subsequent chapter; but as one or two cases occurred during the time treated of here, and had their influence on subsequent legislation, we have considered it advisable to dispose of them before proceeding to describe the legislation of the last twenty years.

It was seen from the commencement of Savings Bank operations that the first and most imperative element should be complete and unquestionable security. When Government undertook to legislate for Savings Banks it did so with a view to their protection from those frauds which must necessarily overtake some of a great number of semi-private undertakings. In 1817 the Banks were rapidly increasing in number and importance, and it was only natural to suppose and assume that abuses would creep into the management. To meet the probability of a misapplication of the funds, Government agreed to take all the money deposited with the trustees of Savings Banks, and to guarantee a certain fixed rate of interest for it, even above that which the fund directly obtained for itself. This was at once an encouragement to the frugal and a perfect security for such sums as were paid to the National Debt Commissioners. In the interval, however, between the payment of the sums by the depositors and the second payment by the trustees, no safeguard was provided beyond the vigilance of the same voluntary and unpaid trustees. Those trustees were completely irresponsible after the year 1828. Before that time we can only assume their responsibility, not from the ordinary reading of the enactment, but from a decision which was given in a court of law. That decision was to the effect "that deposits are made by persons, not on the faith of the person acting as cashier or actuary, but upon the faith of the gentlemen who act as trustees.... If, therefore, the clerk or other person employed by them (the trustees) is guilty of peculation, they are themselves liable for any defalcation which may ensue." Whether this decision was right in law or not matters little now, inasmuch as the Act of 1828 released the trustees from any such obligation entirely, declaring as it did that "no trustee or manager should be personally liable, except for his own acts or deeds, or for anything done by him;" and even this was again limited "to cases where he should be guilty of wilful neglect or default." The valueless character of the safeguards granted to those who of all classes most needed ample security for that for which they had pinched and economized soon began to be seen.

Having limited the period of our survey in this chapter to the year 1844, we cannot here introduce the case of the great frauds in Savings Banks which created such painful sensations all over the country as one by one the most monstrous iniquities practised on the most deserving of the poor came to light. Our only reference here will therefore be to one such case in Ireland, and the first instance of the kind in England.

The case of the Cuffe Street Bank in Dublin, which, so far as we can find, was the first serious defalcation committed on Savings Banks made public, was also one of the most ingenious instances of an accumulation of frauds on record. The other case occurred in connexion with the Hertford Savings Bank in 1835. The Dublin fraud brought to light earlier than this date deserves the first place, not only on this ground, but because it was greater in extent and deeper in villany. No one can read of the numerous cases of fraud which have occurred at different times in connexion with the Irish Savings Banks without feelings of deep indignation. The influence, it is quite clear, is felt in Ireland to this day. The Irish people are quite an exceptional people, with whom forethought and self-control are not indigenous. One of the most important organs of public opinion in Ireland, in alluding to such topics, has said that "nothing can be expected from the Irish peasant until he learns to restrain his irregular impulses--impulses often generous, but too often impetuous and ill-directed--until he learns to make the gratifications of the present yield to considerations for the future." For many years the Irish poor were left to themselves, and the result was shown in their reckless and determined improvidence. The institution of Savings Banks is described as having come to the Irish industrial population like a ray of hope. Great improvement took place. The Irish labourer has never been worth so much as the English one,--the wages of many at the period of which we are speaking being generally sixpence, and scarcely ever more than a shilling a day,--and yet it can be proved that this very class had managed to contribute to the Savings Banks in Ireland, up to the year 1841, no less a sum than 2,000,000l. out of the total of 2,800,000l. then remaining in Irish Banks. It is impossible for pen to describe the result of a bank failure, occasioned by the worst possible circumstances of fraud, upon such classes as these. The actual failures spread dismay over the entire country. The loss they sustained was their ruin; for, so wronged, scores of them were thrown back despairing on their former recklessness, and referred to their treatment as full excuse for any amount of subsequent improvidence. And men will hesitate before they blame them.

The Cuffe Street Savings Bank at Dublin was originally established in 1818 as the St. Peter's Parish Savings Bank. It was started by several of the most influential gentlemen in Dublin, who formed themselves into trustees and managers. The then Archbishop of Dublin, Archdeacon Torrens, Judge Johnson, and Serjeant (afterwards Lord Chief Justice) Lefroy being among the most prominent. On the strength of the well-known character and wealth of the trustees, this bank from its commencement did a very large business; so much so, that it was calculated to have received in deposits in one year (1831, when the bank was at its best,) no less than 100,000l. The bank began on an unpretending scale enough, to judge by the appointment and pay of its only salaried official. This person was a Mr. Dunn, who combined in 1818 the functions of sexton to the parish with which the bank was immediately associated, with that of actuary of the bank, at a salary of five pounds a-year. The rector of the parish was security for Dunn; but all such considerations troubled the trustees but little. On the strength of this person's religious character, for "he was a very correct man," he soon became factotum. Almost from the first a boy of the name of Ballance, whom Dunn had taken from a charity school, was his book-keeper. This lad was also a kind of general servant of Dunn's, living with him in his house, and soon became his perfect tool. Without making him his confidant--for the actuary was too cunning, as it seems, for that--he used him exactly as if he had been one. For eight years Dunn managed solely the affairs of the bank, giving the most perfect satisfaction to every one, depositors as well as trustees. In 1826, however, a Mr. Lannigan, a barrister, comes prominently upon the scene. This gentleman was a trustee, and seems to have been dissatisfied with being one merely in name. Mr. Lannigan began, therefore, a little "meddling," and from the way his interference was received, this trustee, shrewder than the rest, began to suspect something not quite right. He then looked narrowly into the system of keeping accounts, and was not long in finding sufficient to awaken the strongest suspicions of Dunn's malpractices. Dunn, however, had not been asleep all this time. He not only with great ingenuity kept his accounts as square as possible, but operated upon the credulity of the other working trustees, and succeeded in getting a party among the number to form a wall round him. On Mr. Lannigan mentioning his suspicions to his brother trustees, Dunn's machinations stood him in good stead: they would not hear anything to the prejudice of this "very correct man." Mr. Lannigan repeated his attempts with the same effect; was considered a suspicious and troublesome fellow, and got no little abuse for his pains. For five years it is said this unseemly contest went on, and although this trustee succeeded so far as to get more than one sub-committee appointed, nothing came of it: the committee were too prejudiced in favour of their servant to go the right way to work in investigating the matter, or they were too easily blindfolded by him to find anything out. Mr. Lannigan, however, persevered in his opposition, and was rewarded by Dunn's retiring, amidst the condolences of the whole parish, which evidently thought him a very ill-used man. Soon the tables turned; and grief of this cheap sort gave place to bitter indignation. Immediately after the man had resigned a depositor applied for some money, when, on comparing his pass-book with the ledger, the account was found to be open in the former and closed in the latter. Hereupon the ci-devant parish sexton absconded. With eyes at length wide open, the trustees called for the books of other depositors, and without as yet making any noise, soon found that Dunn had appropriated 6,000l. to his own use. The trustees then communicated with the National Debt Commissioners, and asked their advice in the emergency, suggesting that some one should be sent over to inquire into the circumstances of the bank, and to close it, if it were found necessary to do so. Mr. Foot, one of the trustees, a Director of the Bank of Ireland, who had been one of Dunn's strongest friends, and who was now one of the most anxious that the position of the bank should be retrieved, took the communication to London, and succeeded in securing the services of Mr. Tidd Pratt. That gentleman went to Dublin, however, not to investigate the case; but simply to make awards, stating how far and in what cases the trustees were liable to pay the depositors. He adjudged in 208 cases, and to the amount of 11,864l. Of this sum 7,500l. were to be paid by the trustees out of the funds remaining in the bank, while the rest claimed up to that time did not consist of legal claims, as the money had been paid to Dunn out of office hours, at his private residence, and even in the street.

Mr. Pratt found out in making his awards that almost every legislative enactment relating to Savings Banks had here been systematically violated; that the bank itself had rules founded upon the Act, but that they had all been evaded. Depositors had placed as much as 200l. in the bank in one year, and had received interest upon all they had deposited; the same individuals were also found to have had two different accounts in the bank. In all cases of this kind where a deficiency existed Mr. Pratt ruled that the depositors could not legally recover, but he recommended in his private capacity, that if the bank were carried on, such sums might be paid out of the accruing yearly profits. Mr. Pratt is said to have recommended in the same way that the bank might go on under a fresh management, and seems to have appointed another set of trustees for the purpose; at the same time informing them that the National Debt Commissioners would receive without remark the yearly statements as usual, though those statements must of necessity for some time to come exhibit an increase of liabilities over assets. The bank was carried on, and against Mr. Pratt's advice the whole of the claims were at once met, "with a view," as the trustees said, "to induce a more perfect confidence." In 1845, the Government observing that year by year the bank was getting into a worse financial position, made an attempt to close it; but on the case being submitted to the Attorney and Solicitor General, they found they could not do so unless the Annual Returns were not sent. The Returns, worthless as they were, had been regularly sent, and thus the Executive was powerless. After another crisis at this period, the bank finally went down in 1848, the liabilities amounting to the sum of 56,000l. and about 90l. to meet it. The number of depositors who had accounts with the bank at the time was 1,900, nine-tenths of whom were poor people. In a debate which occurred in the House of Commons immediately after this failure, Mr. Reynolds, the member for Dublin, commented in strong terms on the conduct of the National Debt Commissioners, who had known the state the bank was in for fifteen years, and had never zealously interfered. This member also stated his intention to move for a Select Committee to investigate the whole question. The Chancellor of the Exchequer said he saw no objection to such a committee, and it was subsequently appointed. The proceedings of that committee, and the assistance which was given to the defrauded depositors after much debate, will be referred to in their proper place in the next chapter.

The results of this fraud in Dublin and the neighbourhood was most disastrous; not only so, but years afterwards, in remote parts of England as well as Ireland, this case of fraud was referred to with considerable bitterness, and urged as an excuse for prodigality and recklessness. There was at the time a still more important Savings Bank, with several branches, in Dublin; and so great was the effect of the fraud, that nearly all the money deposited in this bank was withdrawn within four weeks, and it was a considerable period before it recovered its position. The depositors in the Cuffe Street bank were of the poorest classes, and the effect upon them when they found they had been robbed of all they had is described as painful in the extreme. "Dealing with the case, and the details of it," said one influential gentleman, "I have never seen anything more calculated to excite painful feelings than this was; some of the depositors were on the very verge of wretchedness and destitution, without a shilling to support them." According to another excellent authority some died of want and distress, and many of them had to seek the shelter of the workhouse. Before the case came on for discussion in Parliament, several petitions were presented to the House of Commons, praying for help, and setting the pitiable situation in which the frauds had placed many of the depositors before the public; and one, signed by 5,076 citizens of Dublin, with the Protestant and Catholic Archbishops of Dublin heading the names, bore out in full the facts to which we have just alluded.

The fraud in connexion with the Hertford Savings Bank was one of the earliest cases that occurred in England, the particulars of which have been made known. This bank, as will be remembered, was one of the first formed in this country. Like many more of the original banks, this one was conducted on the principle of making it a Head office for the surrounding district, with branch banks radiating from it as from a centre. Clergymen, as has already been stated, almost exclusively acted as the Agents for these branch banks. The Rev. Mr. Small, a clergyman at St. Albans, acted in this capacity in that town, and in the course of a connexion with this bank, extending over a period of several years, contrived to embezzle the money entrusted to him to the extent of 24,000l. This he did in two different ways. In the one case, he received deposits and did not remit them; and in the other, acting with due clerical discretion, he applied to the Head bank for sums in the names of depositors for which he had not received their warrants. The systematic frauds of this reverend gentleman were found out when the St. Albans Bank was detached from the parent stock under the erroneous impression that it was strong enough to commence business on its own account. It appears that in this way the trustees of the principal bank were only liable for half the amount of the defalcations; but it ought to be placed on honourable record, that eventually, through the liberality of the trustees, who, fortunately, were principally rich noblemen, the poor depositors were reimbursed of their losses in full. We have gathered the above facts from statements made in the House of Lords in 1835, and as the question of the liability of trustees and the security of deposits was then largely introduced, it may be interesting to follow up the story with a few remarks to which the case gave rise. The Marquis of Salisbury, one of the trustees, asked the premier, Lord Melbourne, if the law, as it then stood, could not be altered. The liability of trustees, inculpating, as it might, innocent men, rendered many gentlemen most anxious to withdraw their names from such offices. This was one horn of the dilemma. The other was, how depositors could be made to feel secure. "It was no trifling matter. When Savings Banks were first formed, but few individuals could ever have expected that the sums subscribed would amount to what they now were." It was high time that the security of these savings, and as to who was liable for them, should be once for all distinctly settled. Lord Salisbury was sure no one would like to remain a trustee without knowing the amount of his liability. He then appealed to Viscount Melbourne--who with himself was a trustee of the Hertfordshire Bank, and would have to pay a share of the loss--whether he would not have a bill brought in to remedy the grievance. Lord Melbourne thought it was not necessary. Much as he lamented, for his own sake and that of the country, what had occurred down in Hertfordshire, he did not think that in consequence of this one misfortune they should interfere with the general business of the Savings Banks in the country. Let them look sharper after the management, and then such things would not occur. Lord Brougham believed there had been great carelessness in the case of this particular bank, "but was happy to find that the trustees were such undoubtedly solvent men." Lord Salisbury and the Duke of Richmond were certain, if nothing had to be done, that many trustees would at once withdraw their names, "and then," said the latter, "the body of depositors would withdraw their money." Lord Denman reminded his noble friends that, if the trustees acted so, their responsibility would, in all probability, follow them into their retirement,--"he was by no means sure that their withdrawal would put an end to their responsibility." The Earl of Wicklow hoped that nothing would be said or done which would destroy the confidence of the public in Savings Banks. He trusted that, in this instance, "the trustees would be found liable for the whole of the deficiency." Lord Salisbury thanked the noble Earl for his kind wish, but explained how it was not possible that this could occur. An alteration in the law was eventually made, but the consideration of this change we leave till the next chapter.

Cobbett's Register. January, 1817.

Nearly, but not quite. Injury is still done by false and mischievous teachers of working men; and the latter resent what they consider their wrongs and grievances in ways which are equally unjustifiable, if not exactly similar to those adopted by their fathers. Those who would do real service to the working classes are those who take up and expose the fallacies of living demagogues, by which the latter are misguided and led to injure themselves by strikes, combinations, and hostility to capital and machinery. And educational reformers will do the State good service in endeavouring to get lessons taught in political economy to those who will be at some future day our mechanics and artisans, and who from continued ignorance of the inevitable laws of supply and demand, of the value, even to them, of the security of property, of the laws which regulate the operations of the market, may possibly fall into the errors and the mistakes of their predecessors.

Report of the Committee appointed by the Highland Society of Scotland to consider what is the best mode of forming institutions of the nature of Savings Banks, for receiving the deposits of labourers and others. Edinburgh, 1815.

Nine-tenths of the existing Benefit Societies are still held at public houses. This arrangement must always be, so long as it exists, a theme for reprobation. There cannot be many greater anomalies than this of the association of the club and the cup, the bane and the antidote, saving and wasting. Speaking on this point, the Rev. J. B. Owen justly remarks that the strange association "together verify the old pagan fable of the tub of Danaus full of holes, whose daughters were condemned to be perpetually filling it, while all that was so laboriously poured in as wastefully and hopelessly ran out." Or, as some one else has put it who has employed the same figure more strikingly:--

"Like Danaus' tub Is the public house club: Their customers' mouths are the holes; Ill spared is the 'chink' That's wasted in drink, To the bane of their bodies and souls."

See next page.

Quarterly Review, vol. xxxii. p. 189.

"Many a man in that year," (1825), says Miss Martineau, "set up for a banker who would, at another time, have as soon thought of setting up for a king."--History of the Thirty Years' Peace. Lord Liverpool complained afterwards of the system "which allowed any petty tradesman, any cobbler or cheesemonger, to usurp the royal prerogative, and issue money without check or control."

One prospectus of this date sets forth that, in the district proposed for a mine there was "a vein of tin ore at its bottom, as pure and as solid as a tin flagon." Another, "Where lumps of pure gold, weighing from ten to fifty pounds, were lying totally neglected," the quantity of gold in the mine "being considerably more than was necessary for the supply of the whole world." Mr. Canning, in reference to the companies projected, said soon afterwards, "They fixed the public gaze, and excited the public avidity so as to cover us, in the eyes of foreign nations, if not with disgrace, at least with ridicule. They sprang up after the dawn of the morning, and had passed away before the dews of the evening descended. They came over the land like a cloud; they rose like bubbles of vapour towards the heavens, and destroyed by the puncture of a pin, they sank to the earth and were seen no more."

Annual Register, 1826.

Progress of Savings Banks. A series of tabular views, 1829 to 1841, by Mr. J. Tidd Pratt. London. 1845.

Companion to the Almanac, 1839, p. 131.

See next page.

We give the statistics as relating to England only. Scotland is out of the question, not merely on account of the slow progress of Savings Banks there, but more especially because of there being nothing analogous in Scotland to our English system of Poor Law relief.

The mortality at the commencement of the present century was 1 in 40; in 1831 it was 1 in 58; and in 1841, 1 in 62; showing conclusively that the masses of the people were better housed, better clad, and, best of all, better fed.

Miss Martineau's History of the Thirty Years' Peace, vol. ii. p. 88.

Times, September, 1844.

To make this statement more clear, we append a later Return, which, on other grounds, is interesting, as showing which classes of the community resort most frequently to Savings Banks. It speaks volumes as to the culpability of the higher paid English operative, that the agricultural labourer, with ten or twelve shillings a week, contrives to save more, relatively, than he does.

+----------------------+---------+--------------+----------------+ | |Number of| No. of |Average Deposits| | Counties. | Accounts|Depositors to | per head of | | | open in | every 100 of | Population, | | | 1858. | Population. | 1858. | +----------------------+---------+--------------+-----------------+ | AGRICULTURAL:-- | | | £ s. d. | |Berkshire | 16,393 | 9·64 | 2 12 7 | |Devonshire | 61,558 | 10·33 | 2 18 11 | |Dorsetshire | 14,134 | 7·67 | 2 12 2 | |Yorkshire, East Riding| 25,091 | 11·35 | 3 6 1 | | | | | | | MANUFACTURING:-- | | | | |Lancashire | 117,927 | 5·80 | 1 12 4 | |Yorkshire, West Riding| 63,334 | 4·77 | 1 5 6 | +----------------------+---------+--------------+----------------+

Something of this result can of course be traced to the varying facilities, such as the number of banks, which were not always established in the most populous localities.

Vide Report of the Select Committee appointed to Inquire into and Report upon the circumstances connected with the failure of the Cuffe Street Savings Bank, 1849, from which our account is derived.

"I am certain," said a reverend witness, "that he was a very correct man until the temptation of such an enormous quantity and overflow of money got into his hands."--Report (36).

One of the questions asked, by the Chairman of the Committee just quoted from, of Mr. Fox, curate of St. Peter's, Dublin, was (32): "Do I understand you to say, that Mr. Lannigan communicated his suspicions regarding Mr. Dunn to the Board of Trustees?" "Yes," answered the reverend gentleman, "and we used to have extremely warm contests there on that account, because he was not a man very capable of explaining his meaning."

The whole of Dunn's defalcations, which were found ultimately to amount to about 40,000l. were not found out till this year.

Great attempts were made to show, at this time, that the Government had grievously neglected its duties, and that the Arbitrator exceeded his. From the anomalous and unsatisfactory state of the law, which occasionally placed the Commissioners and the Certifying Barrister in embarrassing positions, a colour was often lent to these allegations. It is very clear that flagrant mistakes were palmed upon the National Debt Office, and never found out, and not less certain that, at this early period, Mr. Pratt was often hampered by uncertain and incomplete powers.

Dr. Hancock, in a pamphlet entitled, Duties of the Public with respect to Charitable Savings Banks. Dublin, 1856.

About sixteen millions sterling.