154 report — 1865. 



Statistics of the Benefit Building and Freehold Land Societies of Birmingham. 



By G. J. Johnson. 



Commencing with the statement that since the year 1842 nearly £2,500,000 had 

 been paid by the working and lower section of the middle classes in Birmingham 

 into such societies, the writer proceeded to explain four Tables illustrating the 

 paper. Table I. gave a list of all the societies enrolled under the Building Societies' 

 Act (1836) since the year 1842, when the first Society in Birmingham was formed 

 under such Act. The number so enrolled was only two. The early societies were 

 all formed on the " terminating " principle ; most "of the later ones (twenty-eight 

 out of thirty-five) on the " permanent principle, the details of which were ex- 

 plained at length. Table II. stated the results of the societies which had either 

 terminated successfully, or been wound up without loss, from which it appeared 

 that about £77,858 had passed through such societies. Table III. gave a list, so far 

 as could be ascertained, of the societies which had ended in loss to the members ; 

 and it was remarked how small a proportion the unsuccessful societies bore to the 

 others both in number and in the actual amouut of business done. Table IV. con- 

 tained the statistics of the nineteen existing Building and Freehold Land Societies 

 of Birmingham, by which it appeared that these societies had received in the 

 aggregate £2,242,968; that their present members numbered 11,193; the amount 

 now due from borrowing members on mortgage was £539,732 ; and the amount 

 due to investing members was £438,043, exclusive of £60,000 due to persons 

 not members who had lent money on deposit at interest. The details of the work- 

 ing of both Building and Land Societies were then explained in reference to both 

 classes of members, investers and borrowers ; and the paper concluded as follows : — 



" There is one question which has forced itself upon the attention of all engaged 

 in the working of these societies, and that is, whether the time has not arrived for 

 altering their legal status altogether. I have no wish to raise legal questions here, 

 but it is not a legal but an economical question, whether societies having an 

 income, as many of the larger Birmingham societies have, from £50,000 to 

 £100,000 a year, ought not to have the advantages of corporate existence as may 

 now be enjoyed by any seven persons who choose, by subscribing a memorandum 

 of Association for one share of £1 each, to form a ' Joint Stock Company Limited.' 

 No one can read the Act of 1836 without noticing that from the preamble declaring 

 ' that it was desirable to afford encouragement and protection to societies to assist 

 the members thereof in obtaining a small freehold or leasehold property ; ' down 

 to the last clause the whole scope of the Act is utterly inadequte to the present 

 condition of these societies. One instance will suffice. It is the theory of the Act 

 that a Building Society is a small Friendly Society, the members of which will 

 meet once a week or fortnight. Accordingly, it provides that a general meeting of 

 the members may be called by a notice read at two such meetings. There are,_at 

 least, six societies in Birmingham with 1000 members and upwards — one with 

 more than 3000. These members pay their subscriptions fortnightly, quarterly, or 

 yearly ; and when they go, or more often send to the office for that purpose, it is no 

 more a meeting than the shareholders going or sending to pay their calls at a bank 

 is a shareholders' meeting. The facts have outgrown the theory on which the Act 

 was constructed. The consequence has been that more than once very improper 

 rules have been made at meetings, called in the Act of Parliament mode, which 

 were necessarily unknown to all the members, except the half-dozen interested in 

 the object on which the meetings were called. 



" What is wanted is a recognition that these societies are no longer small friendly 

 societies, but are large investment associations, and are therefore entitled to become 

 incorporated companies." 



Statistical Data in relation to the Representation of the People. 

 By Professor Leone Levi. 



On the proposed Extension of Government Administration to Railways. 

 By T. de Meschin, LL.D. 



