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SAVINGS MOVEMENT
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General. A fee of is. was charged in respect to each transferee. Certificates were not negotiable, and their value would not be paid to anyone but the holder whose signature was registered by the Post Office. Holders over 16 years of age could make nominations of their holdings in case of death. Every nomination had to be on a proper form, which could be obtained from the Controller of the money order department, and required to be received by the Con- troller during the lifetime of the holder. In addition to the receipts for the payment for single certificates costing 153. 6d., each of which was stuck into a certificate book, single documents repre- senting 12 or 25 certificates could be obtained from any money order post-office and most banks. These consisted of two parts divided by a perforation, the left-hand portion for registration, and the right-hand portion to be retained by the purchaser. Books were not supplied for these certificates. Documents were also issued for any number of certificates from 26 to 500, both inclusive. These were not kept at local post-offices, but were issued by the Controller and Accountant General of the Post Office, to whom application with remittance was made direct or through a bank. They were applied for on a special form and issued a day or two after receipt of the application. If a certificate, Or book of certifi- cates, were lost, a new certificate, or book of certificates, would be issued at a charge of is., provided the serial numbers could be furnished to the Controller of the money order department.

On Dec. 4 1920, the old print of War Savings certificates was withdrawn from sale at post-offices and banks, and on Dec. 6 " Na- tional Savings " certificates were substituted. The change was legalized by the Savings Bank Act of 1920, and was one of title only. The conditions attaching to the old certificates still applied.

The savings certificate formed the basis of the operations of the War Savings associations, which were established under the auspices of local War Savings committees and affiliated to the National War Savings Committee.

War Savings Associations. Not less important than the War Savings certificate was the system of association, or club, pro- posed by the Montagu Committee. In their final report the Com- mittee pointed out that the would-be investor should not, if it could be avoided, be left to himself to seek for an investment. Facilities for investment should be provided by agencies in close touch with him; and these agencies, having succeeded in inducing him to save, should endeavour by careful propaganda and by thorough organization to persuade him to make the continuance of saving a matter of habit. The Committee emphasized the advantages of placing an agency between the small investor and the State which could collect and manage the savings of the small investor. It was pointed out that the Government could enter into no contractual relationship with the individual investor, unless it assumed complete control over the schemes adopted and also supervised in detail the actual administration of the societies themselves. They added that the organization of such control and supervision would require the creation of a new Government department, which, apart from the question of the expense involved, it would have been impossible to staff during the war. Also, the rigidity of procedure which a State system would inevitably involve would be fatal to the free local initiative on which the success of such a scheme would depend. At the same time, if societies, many of which have at their com- mand no expert financial knowledge, were left free to develop schemes without supervision *>r control, some of them would not unlikely become insolvent. The problem was to obtain the best safeguards which could be secured for the financial soundness and efficient administration of the different schemes, while leav- ing the responsibility for both administration and results with the societies themselves, and they recommended that the com- mittee which should be appointed by the Government, and to which the various investment societies might be affiliated, should be regarded, not as representing the Government, but as an independent body of experts acting on behalf of the societies themselves. Its duties would be primarily of an advisory char- acter, but it could properly refuse to recognize any society the constitution and rules of which it did not approve and withdraw recognition from any society which might fail to satisfy the committee that it was being properly administered. The com- mittee could, if it saw fit, organize a system of inspection and audit of the operations and accounts of the affiliated societies and by these means secure a very substantial measure of control over their operations.

Local War Savings Committees. In accordance with these views, the War Savings Committee embarked upon a widespread scheme for the promotion of savings associations, delegating the propagandist work in a large measure to local committees which were set up throughout the country. Before the war was over there were in existence in England and Wales 60 county com- mittees and 1,840 local war savings committees acting as propa- gandist agencies under the general control of the central body, while the War Savings associations set up under their auspices numbered over 40,000 with a membership of approximately 4,000,000 people. (At the end of 1920 there were still 1,701 local committees and over 28,000 associations.) A savings associa- tion could be formed by any number of people who were willing to work together to secure the attainment of its objects. In practice it was found that an association could readily be formed by those who were already corporate in some way ; for example, by those who were members of a trade union, a friendly society or a cooperative society, by fellow workers in a shop or factory, or by the members of a church, chapel or social club. Each asso- ciation had its governing committee, secretary and treasurer.

Scotland and Ireland, with their separate organizations, devel- oped the movement on similar lines. The total number of vol- untary workers in the movement was estimated to be between 200,000 and 250,000.

Official Agents. By the end of 1917, when nearly 30,000 War Savings associations had been affiliated, there had been estab- lished on an average one association for every 1,200 inhabitants in England and Wales. Most of the social and industrial groups were covered, but it was realized that a large section of the wage- earning population and, possibly, the most highly paid, did not readily join War Savings associations. Many employees objected to joining associations to whose books their employers might have access. They were of opinion that knowledge of the fact that they were saving money might tend to diminish the force of any claim they might make for enhanced wages on account of the increased cost of living. With a view to reaching the pro- spective small investors of this class, it was decided to add to the number of places where War Savings certificates and National War Bonds could be bought. Certificates were on sale at all money order offices and at most banks, but the majority of the class of persons under consideration had no banking account and had no reason to enter a bank. The Post Office staff was obviously unable to make any special effort to push the sale of Government securities, having regard to the heavy mortgage on their time caused by the manifold additional duties which the exigencies of the war period cast upon them. It was there- fore arranged to license certain tradesmen and firms as official agents for the sale of certificates and bonds. These agents pur- chased the securities outright with their own funds and received the certificates and bonds dated, but unregistered. They then resold the certificates and bonds to their customers and others. By the end of the war, these securities were on sale at more than 14,000 shops and other establishments throughout the country. Very large numbers of certificates in the aggregate were sold in this way. The success of the system is noteworthy in that it involved the sacrifice by the official agents of the interest upon the capital used for the purchase of stocks of certificates between the dates of purchase and sale.

Savings Schemes. The National Committee, following the guidance of the Montagu Committee, had also set itself the task of preparing various model schemes of cooperative saving to meet the requirements of the people. The following schemes were evolved at various times:

Scheme I. Money subscribed through a savings association was invested in Post Office Exchequer bonds. For each 5 Exchequer Bond a subscriber paid 2s. a week for 50 weeks, or los. a month for 10 months. All sums subscribed were remitted to the Treasury each week, the Treasury paying interest on the amounts received at the rate of 5 % per annum. The bonds and cash payments due to members were distributed half-yearly, e.g. in the case of sub- | scriptions beginning May 1916 bonds and cash were distributed June I 1917, weekly subscribers receiving a cash payment of 2s., and monthly subscribers is. gd. The cash distributed was free of income tax, but had to be included in the income-tax return of mem-