In his book, Britain's First Municipal Savings Bank, the BMB's first General Manager J P Hilton (in a Chapter entitled The Birth of an Idea), described the actions of Neville Chamberlain in late 1915/early 1916 to implement his idea of a municipal savings bank to assist the war savings campaign. Neville Chamberlain's work in that period involved consultation with the local Trade Unions, Government Departments (principally the Central Advisory Committee for War Savings), and the assistance of a number of people including Councillor Eldred Hallas who proposed a system for collecting savings by means of coupons. Further consultations included a chartered accountant, Councillor Charles Appleby. On the basis of these consultations, suggestions received, and generally supportive responses, Neville Chamberlain brought the 'Birmingham War Savings Scheme' to the attention of the City's Finance Committee.
Consequently, the commencement of the formal proceedings to provide Birmingham with a municipal savings bank began on April 4th 1916 with a Report by the Finance Committee (which included the phrase The Corporation shall open a Savings Bank, to be called "The Birmingham Corporation Savings Bank") to the City Council. After discussing the report, the Council passed two resolutions:
23,299 RESOLVED. That the Birmingham War Savings Scheme now submitted be approved and adopted and that subject to the necessary authority being obtained a Special Committee be appointed to carry it into effect with power to make any modification in detail that may be required by the Government Departments or found to be necessary in practice.
23,300 RESOLVED. That such Special Committee shall consist of the Lord Mayor, Aldermen Lloyd and Williams, and Councillors Appleby, Beard and Hallas.
This Special Committee was to be known as the War Savings Bank Committee, and later that same day, a meeting of this Committee was also held at the Council House. Present at this latter meeting were The Lord Mayor (Alderman Neville Chamberlain); Aldermen J H Lloyd and T O Williams; and Councillors E Hallas and C T Appleby.
The Committee then resolved that Neville Chamberlain be elected Chairman, and the Town Clerk (E V Hiley) presented a report:
I beg to report for the information of the Committee that I received a letter dated the 27th March from the Central Advisory Committee for War Savings approving in principle of the Birmingham War Savings Scheme. I submit the letter herewith and suggest that the Committee should agree to the proposal of the Advisory Committee that 90% of the receipts should be invested in Government Securities, with a stipulation that if the amount was found to be excessive in practice, the Committee should be allowed to revert to the original suggestion of an 80% investment. On the other paragraphs of the letter, I suggest that the City Treasurer be authorised to confer with the Secretary to the Advisory Committee. It is obvious that the Advisory Committee have not appreciated the object with which the fines were introduced into the Scheme and I anticipate that a word or two of explanation is all that is necessary on this point.
I have also to inform the Committee that I have been told confidentially that conferences are taking place between the Treasury and the Local Government Board and the Scottish Office, and also the officials at the House with the object of securing the introduction of a clause into the Local Government Emergency Provisions Bill during the Committee stage. The clause will be in general terms conferring power on the Councils of Boroughs in the United Kingdom and Ireland exceeding 50,000 population to establish savings banks and to receive deposits and guarantee the payment of interest on such deposits, and to make a charge on the borough fund subject to certain stipulations and to regulations to be framed by the Treasury in consultation with the Local Government Board. The powers will only last during the present war and for such period not exceeding a year thereafter as the Local Government Board may determine.
The Committee will also be glad to know that the Lord Mayor has received written promise of help and co-operation in the Scheme from the Managers of the London, City and Midland Bank, the National Provincial Bank of England, and Barclay and Co., of the United Counties Bank, and Mr Newman, the Manager of Lloyds Bank has given a similar promise verbally.
The Town Clerk then read out the letter (dated March 27th) that he had received from the Central Advisory Committee for War Savings:
My Committee have this afternoon considered the revised draft of your scheme and in principle have approved it subject to certain alterations as follows:
In regard to Clause 2 they suggest that 90% should be invested in Government Securities, 10% being kept liquid for meeting withdrawals - My Committee recognise that without actual experience it is difficult to fix with any degree of certainty on any sum likely to meet ordinary withdrawals. Consequently if in practice after the scheme has been in operation for some time you find it necessary to retain a larger sum the Committee will be prepared to give their consent to increasing this amount up to 20% on receiving a representation from you - while they would of course expect you to invest more than 90% should practice prove that this is conveniently possible.
The fines provided for in Clause 7 scarcely hardly seem to accomplish the object, which it is thought you may have in view, of keeping the deposits of members in level pounds. It would be a manifest convenience to do this from a book-keeping point of view, and we think your Committee should give further consideration to this question. It is not clear from the Scheme as submitted whether withdrawals from the Deposit Account of the member opposed to his Coupon Account are to be permitted without penalty in any amount and at any time.
With regard to the books, the question whether these are supplied by the Committee must ultimately depend on whether our Committee decide to adopt this as a Model Scheme for other Corporations, but in any case they will be glad if you will submit specimens of what is required.
I am not able at the moment to make any definite statement with reference to the decision of the Treasury and the Local Government Board in regard to any legislation that they may put forward.
(Signed) Basil P Blackett
For the Secretary.
The War Savings Bank Committee resolved to receive the Town Clerk's report and to approve the amendment that 90% of deposits be invested in Government Securities. They then proceeded to consider details of the Scheme and decided to make the following alterations, and to ask the Town Clerk to advise the Central Advisory Committee on War Savings accordingly:
- the requirement that coupons should be dated by the employer with a rubber stamp be deleted (Clauses 5 and 7);
- the final part of the last sentence of Clause 7 be amended to read (by adding the underlined words) 'depositors transferring to or working for employers who are not in the scheme';
- The first sentence of Clause 8 amended to read (by adding the underlined words) ' A depositor desiring to withdraw his money, whether represented by a deposit book or an incomplete card or both may give seven days' notice in writing of his intention to the Corporation at their Savings Bank and forward his book or current card and at the expiration of that period shall attend either personally or by an authorised representative at the Savings Bank to receive his money;
- the remainder of Clause 8 (regarding the payment of fines on certain withdrawals) to be deleted.
The Committee then considered a report by the City Treasurer:
The Treasurer has had under consideration the books and forms that will be required in connection with the Bank, and he now submits specimens as follows, namely:-
2. Application form
3. Nomination form
4. Coupon card
5. Register of coupon cards
6. Deposit Book
7. Depositors' card ledger
8. Register of withdrawals
9. Orders on Treasurer
There will be required some other books not yet designed, the principal of which will be the Cash Book and the General Ledger.
The Scheme provides that Nos 1, 2, 3, 4 and 6 shall be provided free of cost by the Central Advisory Committee on War Savings. The provision of the remaining books and forms will be chargeable to the Bank.
Coupons would be of the denominations of 1/-, 2/-, 5/-, and 10/-, printed on different coloured grounds, and they should be made by the printer in packets containing 20 coupons each. A supply of coupons would, on request, be forwarded to each of the chief branches of the local Banks, and an account kept of the coupons so distributed.
It is proposed that Current Accounts be kept with Lloyds Bank Limited, the London City and Midland Bank Limited, Messrs Barclay & Co. Ltd, and the National Provincial Bank of England Limited, and that moneys received from the sale of coupons be transferred to those Banks by their own branches, and also by the other Banks in the town.
Cheques in payment of withdrawals, or for specimens of management, should be drawn upon any one of the four Banks as might seem most convenient to the Committee.
The form authorising the deductions from the employee's wages will be made out in duplicate and signed by the employee. One of these forms will be retained by the employer as his authority for making the deductions, and the other will be sent by the employer to the Savings Bank.
Upon receipt from the employer of the application form, duly filled up, a Coupon card will be prepared by the Savings Bank, upon which will be written the employee's name and address, and the number representing his account. The card will thereupon be returned to the employer in order that it may be handed to the employee with the first coupon paid to him in respect of his wages.
The Savings Bank, when preparing the Coupon card, will also prepare in like manner a Deposit Book.
When the employee has fixed coupons to the amount of £1 on the card, he will himself transmit the same to the Savings Bank and will receive in return by post a Deposit Book with the amount shown on the card to his credit. On each occasion on which Coupon Cards or Deposit Books are transmitted to the employee by post, an envelope addressed to the Savings Bank will be enclosed for the subsequent return of the card or book.
Deposit Books have been designed with one cash column only, with a view to the least possible expense, and it is proposed that when withdrawals are made, a total shall be made and the amount of the withdrawal entered in red ink and deducted from the amount standing to the credit. Each entry in the Deposit Book will be initialled by the Bank Clerk.
The other books and forms are for internal use only, and do not need particular description.
After reviewing the forms submitted by the City Treasurer, a number of revisions of the designs were made by the Committee and it was resolved to submit them to the Lord Mayor for approval and afterwards to the Central Advisory Committee for confirmation.
It was also resolved that the Lord Mayor be requested to make a personal appeal to the employers of the city asking for their co-operation; that Councillor Hallas should draw up a notice setting out the advantages of the Scheme that could be circulated in factories, shops, and offices; that Alderman Lloyd to see whether arrangements could be made for the Savings Bank to be allowed to use part of the Water Department's offices in the Council House; and that Councillors Beard and Hallas arrange a conference of Trade Union and Labour organisers with the object of making the Scheme known.
The next stage was the passing of the necessary legislation to enable a local authority to establish a Savings Bank. Accordingly, just one week later, on April 11th, a Bill to "facilitate the Investment of Savings in Securities issued for the purposes of the present War by means of the establishment of Municipal Savings Banks" was introduced into the House of Commons.
The second meeting of the Special Committee (now known as the Corporation Savings Bank Committee) was held at the Council House on April 17th. Present were the Lord Mayor (Neville Chamberlain), Aldermen Lloyd and Williams, and Councillor Appleby, and the meeting was advised that the Bill to permit the establishment of the Bank was to be read the same day.
The Central Advisory Committee for War Savings had written to say:
I am much obliged for your letter of the 5th instant. The Scheme with the modifications mentioned in your letter appears to me to be entirely satisfactory, but I will of course, bring it before my Committee which has a meeting tomorrow, and after it has been met I will write to you again.
There are one or two small points to notice about the print of the Scheme. One is that the Central Advisory Committee has now been amalgamated with the Organising Committee and should now be called the National War Savings Committee. The title appears twice on the first page and again in Rule 10. Perhaps you will have these alterations made in any subsequent copies of the Report that you have printed.
I gather that in Rule 2 "90" will be substituted for "80".
In the last line of Rule 5 I thought your procedure was that new cards should be obtained from the employers rather than the Bank. It might possibly be either.
I shall be pleased to receive the proofs of the books and cards from the Treasurer. I should also be obliged if you could let me have say 100 prints of the Report of the Finance Committee.
(Signed) William Schooling.
The City Treasurer reported that:
on the 14th instant he attended at the offices of the National War Savings Committee and saw Mr William Schooling with reference to the forms suggested for carrying on the business of the Bank.
Subject to some minor alterations Mr Schooling approved the forms. He suggested - though he was careful to say that he could not pledge the Government to the fullest extent - that the Government would defray the cost of all the books and forms necessary for carrying on the work, including the ledger cards, but not including the cabinets for holding the same.
The Treasurer is now having the revised forms completed in order that they may be sent up to Mr Schooling to be dealt with by the Government Stationery Department, and it was promised that proofs should be forwarded to the Treasurer in due course.
With reference to the question of premises, the only accommodation that the Treasurer has been able to find is contained in three rooms in the offices of the Water Department, facing Edmund Street. With comparatively small structural alterations an entrance to these rooms could be made from Eden Place, and they would be cut off from the remainder of the Water Department. This is an important feature, inasmuch as the Bank would need to be opened for two or three evenings a week. The rooms contain an area of about 600 square feet, and the Water Committee are willing to grant the use of them at a rental of £75 per annum.
While the rooms appear to be quite suitable for the purpose, the only question that arises is whether they afford sufficient space in case the business of the Bank should extend to very large dimensions.
It would perhaps be best to make arrangements for 10,000 contributors to begin with, but if the Bank should prove to be popular this might possibly increase to as many as 50,000 in which case the accommodation afforded would be somewhat inadequate.
In reply to the Lord Mayor's letter to members of the Birmingham Chamber of Commerce, sixty-nine replies were received, four of these were refusals to join the scheme "on account of already having so many weekly contributions for employees, or from the fact that the firm was not engaged on war work and the employees were not receiving abnormal wages." Although several replies omitted the number of employees, the total number in employ by those who did was given as 10,585.
The Committee was informed that (1) a notice had been inserted in the morning and evening papers on April 14th. As replies were received, a batch of circulars, drafted by Councillor Hallas, was despatched to each firm by the Globe Express, and so far, sixty-four parcels had been sent out; and (2) that an offer had been made by the Oliver Typewriter Co. to loan a machine for as long as was desired.
Councillors Beard and Hallas reported that they had arranged a meeting of the Trades Unions and Labour Organisers to take place in the Council Chamber on April 27th at 7:30pm.
The City Treasurer stated that he had received applications for the post of Bank Manager, and it was decided that the question of the Manager and staff be left in the hands of the Lord Mayor and Councillor Appleby.