I beg to move, in page 16, line 30, to leave out "two hundred and fifty" and to insert "three hundred".
Perhaps it would be for the convenience of the House if we considered, at the same time, the next Amendment, in line 36, to leave out "£250" and to insert "£300".
The Amendments give effect to an undertaking which I gave in the Standing Committee to my hon. Friend the Member for Oldham, East (Mr. Mapp) and to my hon. Friend the Member for Holborn and St. Pancras (Mrs. Jeger) and others. They had Amendments down to this Clause and I undertook to consider whether the limit of £250 which was originally contemplated as the upper limit for making an administration order could not properly be increased.
I am happy to say that we have considered this matter and are now inviting the House to agree that the limit of jurisdiction in the county court for making an administration order should be £300 and not £250. May I, in commending the Amendment to the House, also remind hon. Members that there is provision in the Clause for this limit to be increased, if found desirable, by an Order in Council on a subsequent date.
Those of us who feel deeply about this subject will be indebted to the Minister for meeting my hon. Friends and myself in this matter. I think that this view extends across the House. In Committee we considered that this amount of £250 which was fixed 60 or 70 years ago, had no been adjusted to our accounting in modern conditions.
Unhappily, there are many homes in which difficult conditions arise, involving debts and other tragic circumstances, and often the welfare worker has to face this problem of debts before he can get the family on the right road. The point was made in Committee that, by this method, moderate debt could be dealt with in the home and the family could be helped back to the right road. I am very pleased that the Minister has been so forthcoming, although I have to acknowledge that I should have preferred a higher figure. I recognise that there is a legal difficulty. I deplore it. I cannot understand the argument that debts arising in household circumstances cannot be expressed in legal language as something entirely different from commercial debts to which different criteria of judgment should apply.
But there it is—and I must tell the Minister and the House that some of our social service workers, not least the Citizens Advice Bureaux, family service units all over the country and child welfare officers all feel that this is a new instrument available to them. At an early stage they will be able to take advantage of this simplified machinery and start constructively on the work of trying to get families back on the right road. We are not only consolidating; we are recording an advance, and to that extent we are deeply appreciative of what has been done.
All of us who have pressed this matter are bound to feel gratification at the fact that the Minister has met our request to some extent. At the same time, we must ask whether the amount being proposed by the Minister corresponds with the social realities of the situation. I do not think that it does. I believe that the great changes which are taking place in credit in the world compel us to look with some skepticism at the new amount which the Minister proposes.
Hon. Members know that there is a long history within this House of how to deal with debt. Not so long ago Members of Parliament sought to remain Members of Parliament because this gave them an immunity from debt with which otherwise they would not have. When dealing with the administration order, which gives a moratorium to people with a multiplicity of debts, we may perhaps recall the days of the 18th century when many hon. Members clung to their membership of the House solely because it freed them completely from arrest which would have led them to prison.
That is relevant to the discussion, because we see that how we deal with the incubus of debt was a problem which was in existence then, affecting our predecessors; and when we read of one million judgment summonses coming before the courts today, we realise that it is a problem today on an even larger scale than in the 18th century.
I therefore ask whether this increase genuinely meets the present needs. The only explanation which has been given why the administration order will not reach £400 is that if it did, we might lay ourselves open to the possibility that each year 60 people more who were involved in commercial debt to the extent of £400 might be able to obtain the benefits which the administration order, under the proposed Amendment, would not give them.
I repeat what I said in Committee. If that is the only explanation, it is inadequate. We are offering those who are harassed by debt an opportunity of having their affairs reshaped and settled without the danger of being in prison and without the anxiety and stress which follow as a result of threats of bankruptcy. If, while extending this aid to the feckless groups, to the problem family groups and to the inadequate personalities, we also, by chance, extend it to 60 people who are involved in commercial debts, I do not believe that any great wrong will be done.
Indeed, if traders are involved in debt to the extent of £400 they are usually corner shop traders—"muddlers"—and not people who are likely to set out deliberately to defraud the community. I do not think, therefore—although I have weighed well the arguments adduced by the Minister—that that is an adequate reason to resist the request that the amount of this order should go up to the sum which is usually accorded to the county court, namely £400.
I ask my right hon. Friend to recognise how the whole credit system of this country is now being changed; how, as a consequence of the hire-purchase Acts we have passed, more and more extension is being given by the big hire-purchase companies to direct credit. They are continuing to grow although we have recently had legislation about hire-purchase agreements which we have caused to be tightened up. The result is that credit sales are proliferating and we have 1 million summonses a year for judgment debts. We can be sure that ere long there will be many many more.
I know that my right hon. Friend is mindful of the fact that each year 7,000 people are imprisoned for debt. Every day there are more than 200 people inside our prisons for debt. Whom are we really seeking to aid when considering an order of this kind? I suppose that the answer is that if we extend it to £400, instead of the proposed figure, that might be unfair to debtors, but who are the debtors we must consider?
If one says that they are the well-conducted businesses of people who give credit, I dispute that because we all know that the incidence of bad debts in a well-conducted credit business are extraordinarily small. When the National Council of Social Service arranged for a survey of hire purchase and credit buying it accepted a statement from the Retail Credit Federation to the effect that the yearly total of bad debts amounted to about ½ per cent, of sales. A representative of one of the larger finance houses gave a figure of less than 1 per cent. of sales to the National Council.
How does it come about that every year this huge number of summonses is issued? How does it come about that we have the problem, with which the Clause attempts to deal, of people who are being overwhelmed and crushed down because they are in debt? The answer is that we have a lot of scavengers at work in our community. The fact is that the large mail order businesses and hire-purchase companies, the large retail organisations and so on, do not generally go to the extent of pursuing people into court. They sell their debts to companies which make a living out of other people's woe. They are selling them to companies which get a percentage of what they collect; companies which have a vested interest in squeezing debtors until, if necessary, they send them to prison.
When I am confronted with a Clause of this kind and I try to have some equity between those in trouble and those pressing them, I am bound to say that I have very little sympathy for those scavengers in our community who make a business out of other people's fecklessness and woe.
Anything I said in Committee is strengthened by the renewed representations I have since received, particularly from child care officers, who tell me—and I know that they would want their remarks stated in the House—that while I have stressed that 7,000 people go to prison, it is likely that, as a result of the National Assistance that has to be given to their families, it is costing the community £1 million a year to sustain the families of people in prison; that is, if we include the cost of maintaining debtors in prison. They say that we often forget the fact that time and again child care officers have to take children into care as a result of their mothers being put into prison.
The fact is that many of those whom we discuss on a Clause such as this are women who have been importuned into debt, often women who have been offered goods at the door and who are open to any representation which may be made. As a consequence, such women find themselves in extraordinary difficulties. When their debt is bought by these debt buyers and these women are pursued, if necessary, to prison, it is the children who suffer and it is the community which keeps those children in care.
Since there is a regulator here, and since there is the possibility within the Bill of the amount being increased, I seriously urge my right hon. Friend to reconsider the matter and raise the sum at the earliest possible moment. After all, today those who can get into debt are just the type of people, unfortunately, who can easily be persuaded to buy an overpriced secondhand car. Goodness knows, there are enough sharp people about in the secondhand car business. When they are about and can sell an overpriced car to somebody, how easy it is for the total sum of debt to be above £250.
I do not understand whom we are attempting to defend. The Minister said that sometimes bankruptcy is preferable. It is for the debtor to make that choice. As our county courts squander their time as debt collectors and as judges of the county court spend one week in four dealing with judgment summonses, it is time the community said that it will not give encouragement to people who recklessly give credit of this character.
One hundred years ago Lord Jessel, the Master of the Rolls, said when the Debtors Act was introduced that he hoped that it would not be long before public opinion completely ended imprisonment for debt. Yet even now the Clause merely imposes a certain check upon it. I am aware that, as a result of the representations which some of us have made, and as a result of the open-mindedness of my noble Friend the Lord Chancellor and of my right hon. Friend the Minister without Portfolio, we are about to have a review of the whole question of the enforcement of debt. A step could be taken immediately by ensuring that an administration order should not be extended merely to £250 but should go as high as £400.