The circumstances of England were in several re spects much less favourable to any plan founded up on the savings of the poor than those of Scotland. The disadvantages existing in England are justly enumerated by Mr Duncan, under four heads ; 1st, The character and habits of the people ; 2dly, The nature of the ecclesiastical establishment ; 3dly, The system of poor laws ; 4thly, The state of the bank ing business.
The first three are general, and the nature of the obstruction which they afford in some degree obvi ous. The illustration of these here may therefore be waved. The last, however, so. intimately con cerns the operations of the banks for the poor, that it requires a difference even in their constitution. It is the practice of the banks of Scotland to allow in terest for the monies deposited with them ; and so perfect is the foundation on which some of them are placed, that the 'security attached to the deposits they receive, is equal to that of the Bank of Eng land itself. The operations of the economical bank are here, therefore, simple in the highest degree. It has only to open an account with one of these banks, and pay to the contributors the interest received, making such a deduction as the expences of the in stitution may require.
In England it is not customary for banks to allow interest on the deposits which are made with them. And where possibly interest might be obtained, the security would not always be rod. The savings banks have no source whence interest can be de rived with the due measure of security, except the public funds. But, with respect to them, a great Inconvenience arises from the fluctuation of price. What is desirable, above all things, is such a degiee of simplicity and plainness in the transac tions, that the reasons of every thing may be visible to the uninstructed minds of the people with whom the institution has ,to deal. But this fluctuation in the price of stock is an unavoidable source of com plication and obscurity. The money of one man produces more, that of another less, according to the price of stock, at the time when his deposit is made. When it is withdrawn, a sum is received, greater or less than that which was put in, according as the price of stock has risen or declined.
The plan upon which Dr Haygarth proceeded, in the bank which his strenuous exertions were the means of setting on foot in Bath, was to make every depositer, to the value of one or more pounds of stock, a proprietor of stock to that amount, and en title him to receive his dividends every six months, the same as those paid at the Bank of England, one sixth being deducted for the expences of the insti tution. In the constitution of this bank, no part of
the management, and no control over it, were given to the depositers. Certain trustees and managers were constituted, \with powers of supplying vacan cies and the money of the depositers was vested in the funds in the names of a certain portion of the trustees.
In the month of November 1815, a bank was pro jected for the town and vicinity of Southampton, to which the zeal and influence of the Right Honour able George Rose in a great degree contributed. In the formation of this institution, the model of the Edinburgh bank was principally followed. It was composed of a certain number of noblemen and gentlemen, who formed themselves into an associa tion for banking the money of the poor ; excludinir entirely the intervention of the depositers. It differ ed from the bank established at Bath, which gave the depositers a proportion of the dividends, and left them to the chance of gain or loss by the fluctuation of the stock which their money had purchased ; the Southampton bank, though it vested the money in government securities, undertook to pay a fixed in vitriable interest of 4 per cent. on each sum of 128.. 6d.; and to repay the deposit when-demanded, with out addition or diminution. The chance of any rise or fall in the price of the funds, the bank, in this way, took itself. The Southampton, like the Edinburgh bank, limited the amount of deposits which it would receive from any one individual; and fixed the sum at L.25.
Some attempts were also made in London. A bank was instituted, under the influence of Barber Beaumont, Esq. in the parish of Covent-Garden. A , committee of the inhabitants of the parish, rated at L.50 and upwards, together with the members of the vestry, form one • committee, and twenty-four of the depositers, chosen by .themselves, form another committee, who jointly choose their agents, and con duct the business. The want of security in this plan is an obvious objection ; the money remaining in the hands of certain individuals, in the character of trea surers, allowing interest at 5 per cent.