Front Page Titles (by Subject) POSTAL NOTES, MONEY ORDERS, AND BANK CHEQUES.∗ - Methods of Social Reform and Other Papers
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POSTAL NOTES, MONEY ORDERS, AND BANK CHEQUES.∗ - William Stanley Jevons, Methods of Social Reform and Other Papers 
Methods of Social Reform and Other Papers (London: Macmillan, 1883).
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POSTAL NOTES, MONEY ORDERS, AND BANK CHEQUES.∗
There can be little doubt as to the need felt by the public for more convenient means of remitting small sums of money by post. The increase of correspondence between different parts of the country is constantly multiplying the number of small debts, debts which cannot be paid by passing coin from hand to hand. The practice is rapidly growing up of buying supplies of draperies, teas, books, and numberless other commodities from well-known firms, situated in a few of the larger towns. Only a well arranged system of parcel posts, as pointed out in the article “A State Parcel Post,” in The Contemporary Review (January, 1879, vol. xxxiv. p. 209), is needed to develop this mode of traffic immensely. But even with the present vexatious charges on small goods traffic, the number of parcels distributed must be very large, and each parcel, as a general rule, necessitates a postal payment. The facility of railway travelling, again, leads people to reside further from their friends than in former days, and multitudes of domestic servants, workmen away from home in search of work, commercial travellers and tourists, require either to receive or remit small sums of money.
The Postal Money Order System is older than is generally supposed, having existed in one form or other since 1792. In its present form, however, the system dates only from the year 1859, and extensions and improvements are frequently announced. In safety and eventual certainty of acquittance, money orders leave little to be desired. The payer has only to walk to the nearest Money Order Office; wait five or ten minutes while other customers are being served; fill up a small application form; decide, after mature deliberation with the postmaster, and reference to a private official list, upon the Money Order Office most convenient to the payee; than wait until the order is duly filled up, counterfoiled, stamped, etc.; and finally hand over his money, and his work is done, with the exception of enclosing the order in the properly addressed letter. The payee, too, may be sure of getting his money, if all goes well. He need only walk to the Money Order Office named, sign the order, give the name of the remitter, and then the postmaster, if satisfied that all is right, and if furnished with the indispensable advice note from the remitting office, will presently hand over the cash. But sometimes the advice note has not arrived, and the applicant must call again; not uncommonly the payer, with the kindest intentions, has made the order payable at a distant office, imagining, for instance, that Hampstead Road Post Office must be very convenient to a resident of Hampstead. The payee must then make a tour in search of the required office—unless indeed he or his friend happens to have a banking account, when all goes smoothly in a moment, and the banker instantly relieves him of further labour in obtaining the seven shillings and sixpence, or other small sum, which the Postmaster-General holds for his benefit. But, seriously speaking, time is too valuable to allow us to deal with many money orders. Business men must long ago have demanded a complete reform of the system, were it not that the bankers came to the rescue of the department, by agreeing to collect the orders, and the Post Office people soon discovered that the banker was the safest and easiest medium of collection.
Within the last six or seven years, however, an interesting attempt has been made to replace money orders by bankers' cheques. There used to be a tradition that it was illegal to draw a cheque for less than twenty shillings; and many people still have an uneasy feeling about drawing a cheque on Lombard Street for half-a-guinea. But the Cheque Bank, established by the late Mr. James Hertz, has helped to change all this. Not only do people now draw very small cheques in their own cheque-books, but, if they happen not to possess that luxury, they walk into a neighbouring stationer's or draper's shop and ask for a Cheque Bank cheque, which is simply filled up and handed over in exchange for the money without more ado. This cheque may be posted to almost any part of the habitable world, and will be worth its inscribed value, for which most bankers, hotel-keepers, and other business people will cash it, irrespective of advice notes and localities. About six years ago, when preparing my book on “Money,” for the International Scientific Series, I inquired minutely into the working of Mr. Hertz's scheme, which seemed to form the downward completion of the banking system, and after six years of subsequent experience, I see no reason to alter the opinions I then expressed about the new kind of bank. The Cheque Bank has met with but one real check, and that is the penny stamp duty, in respect of which the bank must already have earned a large revenue for the Government, while the Money Order system has occasionally been losing revenue.
The Post Office authorities, not unnaturally moved by this state of things, have now produced a scheme for the issue of Postal Notes, which, if successful, are no doubt intended to supersede money orders and Cheque Bank cheques as well. The Bill now in Parliament for establishing this scheme bears the names of the present Postmaster-General Professor Fawcett, and of Lord Frederick Cavendish. The rather startling draft regulations which accompany the Bill purport to be the orders of the Right Honourable Henry Fawcett. But it must surely be understood that this eminent economist is not responsible for the details of the scheme, except in a purely official capacity. The Bill, though altered in details, is not now put forward for the first time, and it is due either to the late Postmaster-General, Lord John Manners, or else to that vague entity “The Department.” But whatever be its origin this Bill is an interesting document, and its clauses imperatively demand consideration.
The idea of the system is to issue orders for fixed integral sums, rising by steps from one shilling as a minimum, to half-a-crown, five shillings, seven shillings and sixpence, ten shillings, twelve shillings and sixpence, seventeen shillings and sixpence, to a maximum of one pound. A person wanting to remit, say nineteen shillings, must therefore apply for the next lower note, namely, seventeen shillings and sixpence, together with a shilling note, and then add six penny stamps, and enclose the whole to the payee. These notes will be issued, apparently, with a blank space for the name of the payee, and another for the name of the office where they are to be paid. In this condition the order may be handed about like a piece of paper money, and will have, so far as I can understand the Bill and regulations, absolute currency. Like a coin, it will be primâ facie the property of its holder, and its bonâ fide owner will be unaffected by the previous history of the note. Any holder, however, may fill up one or both blanks, and it then becomes payable only to a particular person and (or) at the particular office named. It would appear, however, that if the payee thus named in the order signs the receipt at the back, the note again becomes practically payable to bearer, like an endorsed cheque to order. Clause 8 of the regulations provides that if the note bears a signature purporting to be the signature of the payee, “it shall not be necessary to prove that the receipt was signed by or under the authority of the payee.” There are elaborate provisions for the crossing of these Post Office cheques, both generally and specially, and it would seem that even though the name of a distant Money Order Office be inserted in the blank, a banker may, under Clause 10, safely cash a note. The regulations point distinctly to a desire of the department to withdraw their notes from circulation as much as possible, through the banking system of the kingdom.
The currency of these notes is somewhat restricted by Clause 11 of the regulations, which provides that when more than three months old notes will only be paid after deduction of a new commission equal to the original poundage, and a like further commission for every subsequent period of three months, or part of such period. Payment may under the next clause be refused in case a note bears signs of tampering or fraud. Then follows the important provision, that “a postmaster may refuse or delay the payment of a postal order, but shall immediately report such delay or refusal, with his reasons for it, to the Postmaster-General.” As, however, this report seems to be intended for the private satisfaction of the Department, and there is no clause requiring the postmaster or the Postmaster-General to give reasons to the holder of the note, this regulation makes the notes convertible into coin at the will and convenience of the Department. There is no act of bankruptcy nor breach of engagement in refusing payment. The local postmaster has simply to give as his reason for suspending payment that he has no funds, and the Department will doubtless regard his reason as a very good one.
Perhaps the most extraordinary clause of the regulations is No. 16, which provides that, if a note be once paid by any Officer of the Post Office, both the Postmaster-General and all his officers shall be discharged from all further liability in respect of that order, “notwithstanding any forgery, fraud, mistake, or loss which may have been committed, or have occurred, in reference to such order, or to the procuring thereof, or to obtaining the payment thereof, and notwithstanding any disregard of these regulations, and notwithstanding anything whatsoever.” Thus is Professor Fawcett, by his own mere fiat—for this clause occurs only in the regulations which purport to be the act of the Postmaster-General—made to shelve the whole common and statute law of the realm in his own favour. Even his own regulations, laid down in the same fiat, are not to be binding on this potentate, who is to be free from all question “notwithstanding anything whatsoever.” These words are indeed a stroke of departmental genius. Red tape is potent for binding the outside public; but within the Department no bonds of law or equity are to be recognised in case of error, “notwithstanding anything whatsoever.”
I came to the study of this scheme much prejudiced in its favour, because it might be the means of breaking down the absurd objection of the English people to the use of one pound notes. A well-regulated issue of such notes would conduce to everybody's convenience, and might give a substantial addition to the revenue, with absolute immunity from financial risk. But then such a currency must be issued on the principle of the Bank Charter Acts, and under strictly defined statutory conditions. It must be absolutely convertible at the will of the bonâ fide holder, and must not be issued for such trifling amounts as one shilling or two shillings and sixpence. In Norway and Sweden, notes of about five shillings in value form a perfectly successful and convenient currency, but as a first experiment it would not be wise to advocate the issue of anything less than a ten shilling note. Even a one pound note currency with token gold half-sovereigns would meet all real needs. But after considering the details of this Post Office scheme, it presents itself as a currency “leap in the dark.”
In the first place, it is quite doubtful whether the postal notes will really fulfil their ostensible purpose of enabling postal remittances to be made easily and safely. The case will be provided for, no doubt, if the notes can be purchased in bundles and kept in the cash-box, and if, again, they can be got rid of, when superabundant, in paying cab fares, small bills, etc. Few visits to the Post Office would then be needed, the notes being current. But what about safety? Almost every postal remittance on this system will contain not only paper money payable to bearer at any Money Order Office, but also postage stamps to make up the odd pence. An ingenious letter-carrier will probably soon learn how to detect the enclosure of postal notes, and even if he destroy the notes themselves, a fair average day's wages might at any time be made out of the stamps, by a systematic operator. Nor is any method of reading enclosures indispensable; for many newspaper offices, large shops, booksellers, and others, habitually receive so many small remittances, that a bold and sagacious post office servant might trust to the theory of probabilities, and prey judiciously on the correspondence of a few favourite firms. The Department appears to have entirely overlooked the circumstances which give such security to bankers' cheques, especially Cheque Bank cheques, namely, that they are made out for odd sums, are seldom or never in the company of postage stamps, are returned for verification and payment within a few days, and, when crossed, are only payable through a bank, that is, through the hands of a perfectly well-known and responsible customer. If the postal notes are to be promptly returned for payment, they may prove even more troublesome than money orders; if they are to circulate as a small paper currency, they can give little security against peculation, especially considering the stamps which will usually accompany them. The Statist, indeed, in an able article on this scheme, in the issue of June 5th, which should be read in connection with an equally able article in the same journal for March 13th, seems to take for granted that these postal notes, with the accompanying stamps, will need to be remitted in a registered letter. But if so, the aggregate trouble and cost of the operation will be almost greater than in the case of the present money orders, and the raison d'être of these new notes disappears altogether.
The fundamental objection to be made to this scheme is, no doubt, as pointed out by The Economist, Statist, and several other important authorities, that it enables the Post Office Department to create a considerable circulation of paper currency, without providing any corresponding guarantees as regards a metallic reserve. It is a Bank Charter Act for St. Martin's-le-Grand, minus the sound principles embodied by Peel in that great Act. There is something humorous in the idea of a sound and sensible economist like Professor Fawcett being made by his Department, as the first step in his official life, to throw over all the nice considerations which belong to the theory of currency. In the lecture-hall at Cambridge, the examination-rooms at Burlington Gardens, or around the board of the Political Economy Club, a score of abstruse questions would arise about the raising of prices, the drain of gold, the seasonal fluctuations of a small paper currency, the proper limits of government industry, and so forth. But, as Postmaster-General, the Professor ignores all theory, and disclaims all liability, “notwithstanding anything whatsoever.” Though hardly responsible for the details of a scheme framed while he was yet merely a professor, he will become responsible for them if he advocates the passage of the Bill through Parliament, or if he allows the scheme to crop up again in a subsequent session.
The worst point of the Bill is that it provides no regulations for the custody or disposal of the large sum of money which will be paid into the Department, if the public takes a fancy to the notes. It is quite impossible to estimate, by any reference to theory or fact, how large the balance will be. In all probability it will not be less than two or three millions sterling, and quite likely double that. If the orders should prove to be popular in the capacity of paper money, the circulation might possibly amount to twenty millions. No ordinary person, indeed, can pretend to understand how the Post Office people can manage to keep a cash reserve at each of nearly six thousand Money Order Offices. Markets, fairs, races, currents of tourists, fluctuations of trade must cause great and often unexpected variations of demand, and it is financially absurd and impossible, and against all the principles of banking, to divide a cash reserve into six thousand fragments! Nor, indeed, is there any provision for the regulation of a metallic reserve, or any reserve at all. The Department would, no doubt, like to have a few millions at their unfettered disposal; but surely a Post Office Bank Charter Act, devoid of any mention of a cash reserve, and with careful provisions for suspending payment whenever convenient, is a monstrous anomaly, and, I may almost say, an insult to the financial common sense of the country.
I suppose we ought to feel indebted to the postal authorities for condescending to give us the pretty full details contained in the present Bill and Draft Regulations. The earliest form of the scheme, as embodied in the Bill of June, 1877, consisted in simply suspending, as regards the Post Office, all laws restricting the issue of promissory notes payable to bearer—a simple carte blanche to the Department to embark in the issue of paper money. In each subsequent edition of the Bill they have condescended to be more and more explicit. Now the Draft Regulations give us all we can want to know, subject to this difficulty, that these regulations may be revoked and altered, within the limits of the Act, by the mere fiat of the Postmaster-General, subject to the consent of the Treasury and the somewhat illusory check of being laid before Parliament within fourteen days after it assembles. I feel sure that I express the opinion of every sound economist when I say that, if we are to have an unlimited circulation of one pound notes and small fractional currency, that currency must be issued under conditions clearly and inflexibly defined by statute. An examination of this Bill, however, will show that it is for the most part an enabling Bill; the restrictions, such as they are, are mostly contained in the regulations, and are revocable by Government without further appeal to Parliament. In fact, the second clause∗ of the Post Office Money Order Act, 1848 (11 & 12 Vict. c. 88), which is embodied in the new Bill, appears to me to enable the Treasury to suspend payment altogether whenever they feel inclined so to do, right of action being barred, “Any law, statute, or usage to the contrary in anywise notwithstanding” (!)
The proposals of this Bill assume a still more ominous aspect when we consider them in connection with the kindred new Savings Bank Bill. This latter Bill, among other matters, is intended to raise the limit of deposits to be made in any one year in a Post Office Savings Bank from £30 to £100, and the total allowable deposit, apart from interest, from £150 to £250. The two Bills taken together disclose a settled design on the part of the Post Office to become a vast banking corporation, and to enter into direct competition with the bankers of the United Kingdom. It is impossible not to agree with the protest issued by the managers of the ten principal banks of Manchester, that such changes would involve a complete change in the raison d'être of the Post Office Monetary Department. The Post Office Savings Banks, as the Manchester bankers correctly remark, were intended to act as eleemosynary institutions—as, in fact, public schools of thrift. By the whole conditions of the original scheme they were designed to induce labourers, nursemaids, children, and other people of very small means to begin saving their odd shillings and half-crowns, and to a certain extent they have fulfilled that purpose. The Post Office was in this respect a deus ex machinâ—it was Jupiter called from above to help a thriftless residuum out of the mire of pauperism. The present limits of the deposits are quite sufficient to meet all the needs of this class. To allow a person to deposit as much as £100 in a year in a State Bank is to step over the line into a totally different class of operations. The matter is made all the worse by the fact that financially the constitution of the Post Office Savings Bank is bad and indefensible. As Mr. William Langton has abundantly shown, to receive a deposit to be paid at call, and then invest it in Government funds of variable value, always throws risk on the Government. A preponderance of withdrawals is always made while the funds are depressed, and an increase of deposits will usually coincide with a high price to be paid by the Department. Thus has already arisen a large deficit on the investments of the old Savings Banks to the extent of nearly four millions, a deficit which Mr. Gladstone is now very properly proposing to pay off by a terminable annuity. The Post Office Banks have hitherto avoided a like deficit by offering only 2 ½ per cent. interest, and keeping the amount invested moderate. But it by no means follows that what has hitherto answered fairly well on a small scale, will always answer as well on the bolder scale now proposed. Already the savings of the people, held on a radically false basis by Government, amount to about three-quarters of a hundred millions. With the enlarged limits proposed for the Savings Banks, and probably additional investments on account of the postal note deposits, we shall soon reach a hundred millions, or one-eighth part of the whole National Debt. Should any serious crisis ever occur, such as a great naval war (and how can we expect to be always free from danger?), withdrawals would unquestionably take place, and the Government would be obliged to make forced sales of its own securities, running down its own credit, and incurring a deficit at the very time when it most needed resources. No doubt in such circumstances the Government would be obliged to raise a large loan in the open market, but this would really mean that when compelled to redeem its promises the Government would have to fall back upon those very bankers with whom it had been competing on most unfair conditions in easier times. The Post Office monetary schemes are essentially fair weather schemes, but they must founder, like The Eurydice and The Atalanta, in case of squalls and rough weather.
If the English Government is really fitted to do banking business, why does it not begin with its own accounts? Why leave the National Debt, the Dividends, the Revenue payments, and a variety of large public and semi-public accounts in the hands of the Bank of England, aided by a banking organisation generally? The fact of course is that not only from the time of Adam Smith, but from a much earlier date, it has always been recognised that a Government is not really a suitable body to enter upon the business of banking. It is with regret that we must see in this year 1880 the names of so great a financier as Mr. Gladstone, and so sound an economist as Professor Fawcett, given to schemes which are radically vicious and opposed to the teachings of economic science and economic experience.
Did space admit I might go on to show that the conditions which the Post Office demand as essential to the success of their monetary operations are tainted by a kind of political immorality. Every common carrier and every banker is responsible under complicated statutes and the common law for every act of negligence, and for not a few accidents involving no negligence. But the Post Office, though it enters into competition with the industry of the country, sets itself above the law. Even a registered letter, if lost, stolen, or destroyed by its own servants, throws no responsibility on the department, except as regards the tardy and absurdly small concession of £2, provided certain regulations be carefully observed. Now, the same department coolly proposes to issue an unlimited paper currency and to do a large part of the banking business of the country under like considerations of irresponsibility. Professor Fawcett, Lord John Manners, or whatever other deserving politician happens to hold the place of Postmaster-General, is to conduct a vast monetary business, and yet to be the final arbiter in all his own transactions with the British public, irrespective of the Law Courts.
Nor, if we investigate the matter, will it appear that there is any real need for these schemes, except to magnify the influence of “The Department” which propounds them. If the banking system of this kingdom were in a rudimentary state, like that of the Fiji Islands, there might be some reason why the Government should try to educate its subjects up to the banking stage of civilisation. But if anyone will take the trouble to look through the Banking Almanack, and to study some accounts of the bankers' clearing-house system, he will appreciate the degree in which the country needs to be taught banking. The Post Office, great as its system may be, is mere child's play compared with the wonderful organisation which settles transactions to the extent of one hundred millions per week in Lombard Street without the use of a single coin. The very remarkable statistics drawn up by Mr. Newmarch, and printed in the Banking Almanack for this year, go to show that the system of Branch Banks is being extended in a wonderful way, and bids fair to distance even in number the increase of money order offices. According to these statistics, the number of Branch Banks, as distinguished from separate Banks, or Head Offices, was in 1866, 1,226; in 1872, 1,386; in 1878, 1,801. The increase in the former interval was at the rate of about 13 per cent., and in the latter 30 per cent.! The number of money order offices was in 1866, 3,454; in 1872, 4,300; in 1878, 5,719, and though the rate of increase is considerable, being in the first interval 24 ½ per cent., and in the second 33 per cent., it does not manifest the same tendency to progressive advance which we notice in the branch banking system. There can be little doubt that the bankers of England and Scotland, if not interfered with, will, in the next ten or fifteen years, establish banking offices in every nook and cranny of the kingdom where there is any business at all to be done, and their competition will result in offering facilities for small savings and small payments which must altogether distance the operations of any Government Department.∗ An impartial review of the whole question can only lead us to the conclusion that the bankers are right in crying out to the Government, “Let us alone!” It is a new phase of the old economic adage—laissez faire—laissez passer; the only novelty in the matter is, that the cry is now addressed to a great Minister and an eminent economist, the latter of whom has advocated in his writings what the former has, to a great extent, carried into effect.
But to return to our more immediate topic of Postal Notes, I will now point out that it is only government interference which prevents bankers from organising a system of small payments by cheques, far more perfect, safe, and convenient than anything the Post Office can do. The Cheque Bank has already done more than the department; it has done a large business in small payments, with almost complete freedom from fraud, and has paid at the same time a large revenue to Government through the penny cheque stamp. But this penny tax, though quite inconsiderable in larger payments, becomes intolerably oppressive in the case of payments under a pound or two pounds. The Post Office probably loses on the smaller transactions of the money order system, and what revenue it does seem to gain is gained on the larger orders, at least so The Statist holds. For my part, I cannot see how we can be sure there is any gain at all, because the business is conducted by the same persons and in the same premises as the general post business, and we can by no means be sure that each of the functions of a postmaster is separately paid in a degree adequate to its trouble. Nevertheless, the Cheque Bank, according to its last report, now about pays its way, in addition to paying a considerable revenue to the Crown.
There is needed but one change to set the whole matter right, and that is to reduce the stamp duty on small cheques, say those under £5 or £3, to one halfpenny. The penny stamp duty on receipts, as everyone knows, is not required in the case of receipts for less than £2, for the obvious reason that it would be absurdly oppressive in the case of small receipts. But exactly the same reason holds good for reducing the tax if not abolishing it in the case of small drafts. There need be no practical difficulty in doing this; for an Act of Parliament of little more than one clause might enact that any cheque form of any banker, bearing upon its face a printed and also an indelible perforated notice that it can only be drawn for a sum of (say) £5 or under, may be impressed at the Stamp Offices with a halfpenny stamp, and shall then be deemed duly stamped, all previous Acts notwithstanding, in the same way as if it had, according to the Stamp Act of 1870, been impressed with a penny stamp. Such a change in the law would create no monopoly for the Cheque Bank; for if the success of this bank became considerable, competitors would soon spring up, and there would be nothing to prevent any bank from supplying its customers with half penny cheques for small drafts. No doubt, the Cheque Bank, in urging the reduction of the penny stamp duty, does so from a weak, because an interested position, but it is possible for other persons to advocate the same measure from a purely public and disinterested point of view.
In the use of such small cheques there is nothing economically unsound. The experience of the Cheque Bank has shown that their cheques do not circulate for any considerable length of time. Being drawn for odd sums, needing endorsement and being all crossed, it is not likely they should circulate. They are exceedingly safe for postal transmission; no post office thief could possibly venture to negotiate cheques, which are, I believe, regularly treated as “duffer,” or dangerous stuff. It is, indeed, a serious question for bankers, how they are to meet the trouble arising from any great multiplication of small cheques. But in any case I do not see how they are to avoid these small transactions, even if they desire it. Cheque Bank cheques are, I imagine, less troublesome than postal money orders, which bankers already collect in large numbers for their customers. As to the proposed small shilling and half-crown notes, it seems to me that they will give infinite trouble to bankers, who must not only sort and count them like the smallest fractional currency, but must examine the dates, to ensure that they are not running beyond the three months' interval of free currency. The Post Office clearly intend, if possible, to oblige the bankers to receive these small notes, judging from the regulations about crossing. If, indeed, the bankers unanimously refuse to receive such notes, the scheme must, I think, fall to the ground, even though Parliament should sanction it.
The general conclusion, then, to which I am forced to come is, that this scheme of postal notes is a mistaken one, which should never have been allowed to come forth under Mr. Faweett's name. It is neither fish nor flesh; neither a well regulated paper currency, nor a safe system of banking payments. It is the scheme of a tenacious and aggressive bureau to underbid the Cheque Bank, and by setting at nought all the customary risks of monetary transactions, to secure the disposal of large funds, while throwing much of the trouble and cost upon the banking community. In the conveyance of parcels and small goods the Post Office has yet much to do, as I have taken trouble to prove; but in the direction of banking, it has already reached a limit which it cannot be safely allowed to pass.
Since the above was in type, it has been stated that the Government will propose to amend the Bill by restricting the currency of the postal notes to one month. This will mar the beauty and success of the scheme. It will be indispensable in a subsequent Session of Parliament to enlarge the interval of currency to three months, if not the twelve months originally proposed by the department. Several homely proverbs occur to one: “Give an inch, take an ell”—“Get the thin end of the wedge in first.” In regard to the Post Office Savings Bank deposits, the wedge is just now being driven home a little. The promoter of the Postal Telegraph Department disclaimed all idea of a statutory monopoly of telegraphic business, saying, “I never should wish for that protection.” There is now an action pending in the Law Courts by which the department will bring the telephone companies well under control. Ministries come and Ministries go; the Department remains.—19th June, 1880.
[∗]“Contemporary Review,” July, 1880, vol. xxxviii. pp. 150–161.
[∗]As it seems indispensable that the country should know upon what basis its future fractional currency is to be issued, I reprint here the 2nd clause of the 11 & 12 Vict. c. 88. It is well worthy of inquiry how far the 16th article of the Draft Regulations can be reconciled with the Act on which it purports to be based:
[∗]In his speech on the Savings Bank Bill (June 18th), Mr. Gladstone is reported to have said: “If they had in this country a banking system so largely developed that it went into every town and considerable parish, he certainly should be very doubtful indeed as to the desirability of raising the upper limit of £200. … The Post Office Savings Banks for the three kingdoms were already beyond 6,000, and were rising at the rate of 300 banks a year; but the other banks, notwithstanding the excellent development which they had undergone, hardly reached 2,000, banks and branches taken together.”