The Road to Windsor:

Centenary of the Royal Charter of 1884 BY D. F. RENN, Ph.D., F.I.A

ROYAL Charters incorporating academic and professional bodies have usually been granted as soon as the organization could prove itself worthy of the honour. Why, then did it take the Institute nearly 40 years to acquire its charter? The story has been told in R.C. Simmonds’s The Institute of Actuaries 1848–1948 but bears retelling here. Since the beginning of the nineteenth century, life office managers had met informally in Edinburgh and London to discuss matters of common interest and to pool mortality experiences. The Select Committee of the House of Commons on Assurance Associations in 1844 advocated the organization of a Society of Actuaries inter alia to issue certificates to persons qualified to practice, but recognized that ‘considerable difference of opinion on the subject prevails among actuaries themselves’. In 1848 a proposal to create a general professional association of actuaries was considered by a committee of senior actuaries associated with old-established offices. Peter Hardy had suggested a ‘College of Actuaries’ but got cold feet when asked to make detailed proposals. These were radical times: Europe was in ferment, and only a few days before the Committee met, the Chartists had organized a revolutionary petition in England. The mass march from Kennington to the House of Commons had broken up because of heavy rain and even heavier policing (organized by the Duke of Wellington) and the petition, when finally delivered, contained far fewer signatures than expected, many of them blatant forgeries. Not unexpectedly, the Committee of actuaries was unenthusiastic about a proposal to widen membership, which would have undermined their position as leaders of the profession. Their fears were not entirely selfish, since many life insurance companies were still collapsing within a few years of their foundation, and the older. more securely founded, companies were jealous for their reputation. But the Committee was outvoted by the radical fervour of the majority at an open meeting. and an Institute of Actuaries was set up under the presidency of John Finlaison, Actuary to the Check Department of the Commissioners for the Reduction of the National Debt. The old guard withdrew and continued to meet separately as the Actuaries’ Club (not to be confused with the Institute of Actuaries Club, founded in 1855 and amalgamated some 40 years’ later). Members of the Club did not seek membership of the Institute and members of the Institute were not elected to the Club, although defection occurred in each direction.

223 224 The Road to Windsor. This division was to persist for nearly 40 years. The acknowledged leader of the profession in 1848, Griffith Davies of the Manchester Guardian, had been absent from the critical meeting. Had he been in better health he would probably have been elected as the first President of the Institute and might have effected a reconciliation. John Finlaison was a very different figure, and there had been past differences between himself and the managers of the life offices. The first number of J.I.A. contains a draft Bill ‘for regulating the Profession and Practice of Actuaries throughout Great Britain and Ireland’, but the writer concluded that the Bill ‘required the concurrence of the government of the day and was unlikely to succeed without the great unanimity, energy and perseverance of the whole profession’. The Institute was advised that the lack of support by the older offices would be fatal to the passage of such a Bill. A further blow was the secession of nearly all the Scots members from the Institute in 1855, following the resignation of the Scots members of Council over certain individual cases of election to Council where some lack of trust—and of communication—had occurred. The Faculty of Actuaries in Scotland was consequently founded and obtained its Royal Charter in 1868. This event, and the problems of legal definition of an actuary in pending insurance legislation led to an informal approach by ‘Mr Brown and some other gentlemen connected with the Institute of Actuaries’ to the Actuaries Club with a proposal to set up ‘an association with a legal status of the Actuaries of Assurance Offices, with exclusive authority to certify under the Life Assurance Companies Bill now before Parliament’. Messrs Brown, Fletcher, Patterson and Tucker of the Institute discussed this with Ansell (senior and junior), Davies, Goddard and Tyndall of the Club in March 1870: although the majority were against the proposal, several suggested that either the Club might be materially extended or an association created including the members of the Club and the actuaries of leading life offices. It is clear that only the Club’s loyalty to a few diehards prevented an amalgamation with the Institute in the seventies: the Club’s exclusivity (membership being restricted to 20) was something of a cachet, and its members peculiarly longlived, so it did not wither away. So matters remained until 1882, when William Sutton brought up the proposal of a Royal Charter of Incorporation at the May Council meeting. The Annual General Meeting on 1 June unanimously agreed that the necessary steps should be taken, but these did not include conciliating the Club. Sutton’s memorandum, covering 48 foolscap pages of the Minute Book, does not explain why the proposal was made and agreed so precipitately: by July the draft petition and charter were agreed and had been sent to Markby, Stewart and Co., then, as now, the Institute’s solicitors. In July 1882, the Actuaries Club wrote both to the Clerk to the Privy Council Office and to the Secretary of the Board of Trade setting out their opposition to the petition, pointing out that most of the members of the Institute were not actuaries of life offices (and setting out the financial details of the offices they themselves represented). The Club suggested that the proposed charter was not Centenary of the Royal Charter of 1884 225 only inequitable to the position of its members but also misleading to the public. In December, the Board of Trade asked that the petition be advertised in both The Times and the London Gazette, and asked for the Institute’s observations on the Club’s letter. The Institute pointed out that the Club had never published anything of value or interest to the profession (conveniently overlooking the 17 offices experience), nor had it assisted young men to qualify as actuaries: it concluded by offering full Fellowship to members of the Club. The Club renewed its objections in February 1883, and the Institute strengthened its reply in April with a long letter to the Board of Trade, pointing out the need for a recognized standard of actuarial competency (with special reference to the ‘thousands of Friendly Societies’ obviously not advised by the members of the Club) and stating that the Institute was open to all who were willing to comply with the conditions of membership. With the letter were enclosed the Institute’s publications, including three specimen copies of the Journal ‘a costly and valuable periodical which has long since acquired a worldwide reputation’. In answering the Club’s claims, the Institute’s letter went on to say: ‘there is no necessary connexion between Actuaries and Life Offices than there is between Engineers and Railways or between medical men and Hospitals’, pointing out that distinguished actuaries holding public appointments (such as the Actuary to the National Debt Office, to the Friendly Societies’ Office, to the Board of Trade or to the Ecclesiastical Commissioners, and those in the service of Colonial governments) were excluded from Club membership—a shrewd thrust this, addressed to other public servants. The arguments that most Institute members could not hope to become actuaries of life offices was countered thus: It might just as well be urged that the majority of the Fellows and four-fifths of the members of the Royal College of Surgeons are not the chief medical officersof hospitals, or that the three to four thousand members of the Institution of Civil Engineers do not all hold principal engineering appointments. The Institute has always been solicitous to have among its members not only those holding leading official appointments but also subordinates and in the nature of things ultimate successors. at the same time doing all that lies in its power to secure that these subordinates and ultimate successors shall by availing themselves of the educational advantages afforded by the Institute prove at least equal if not superior to their predecessors in professional acquirements. It follows therefore that among the four-fifths of its members who are not actuaries of life offices are included not only those actuaries holding important Government or other appointments and those in practice on their own account but also the future successors, probably for the next two generations of the remaining one-fifth.

The constitution of the Institute of Actuaries ‘was directly opposed to anything in the nature of a trade union as respectability of character combined with the passing of examinations has always enabled any person to obtain a certificate of competency’. It was, nonetheless, clear that the influence of the Actuaries Club was still potent, although its members represented only about one-quarter of the combined funds, income or expenditure of life offices by this time. Both the Treasury and the Board of Trade advised the Privy Council against the petition, 226 The Road to Windsor. but the indefatigable Sutton managed to get the decision deferred. He circulated a memorandum in influential quarters, and strenuous private efforts were made. Some indication of this is given by Sutton’s list of gentlemen who had assisted in bringing about this ‘successful result’ naming (apart from members of the Institute) John Bonham Carter, late M.P. for Winchester and member of the last Friendly Societies Commission. Rt. Hon. H.C.E. Childers, M.P., Chancellor of the Exchequer. Rt. Hon. Sir Louis Mallet, C.B., Privy Councillor and late Under-Secretary of State for India. John Munbey. M.P. for Newcastle on Tyne. Rt. Hon. A.J. Mandella, M.P. Vice-President of Committee of Council on Education. R. Spence Watson, L1.D.,Newcastle on Tyne. and The Times published an article on Friendly Society Finance on 26 December 1883 making direct reference to the Institute and its educational work. By the following February the wind was blowing favourably for the Institute: the Club now claimed that if its objections were overruled its members should be scheduled in the Charter as having the privileges without actual membership of the Institute. The Institute sensed a legal difficulty in doing so but offered to make any Club member a Fellow free of all subscriptions. The Club then raised the cry of ‘monopoly’ asserting that the requirement of Fellowship for legislative purposes would restrict the freedom of appointment hitherto available to the directors of a life office. Although this gave rise to some correspondence in The Times, it was the Club’s last throw and they finally gave way, declaring, nonetheless, that a Charter was undesirable in the interests of the profession or the public. On 26 June 1884 Sutton (who lived at 28 Abingdon Street, hard by the Houses of Parliament) heard that Her Majesty that day had approved the Charter at a Council held at Windsor: The Charter was sealed three days later and is reproduced in J.I.A. XXV, 5. The fees for obtaining the Charter were £165.13s.6d plus the solicitor’s bill of £142.10s. T.B. Sprague’s Presidential Address of 24 November 1884 began thus: Gentlemen, since we last met, a most important event has occurred in the history of our Institute. The object at which we have been aiming for more than two years, has at last been happily attained. A Royal Charter has been granted to the Institute of Actuaries, and our profession now takes its proper position before the public, as a united and officiallyaccredited body. As our first president, the venerable Government Actuary. John Finlaison. pointed out at the foundation of the Institute, it is very many years since the profession of an actuary was recognizedin Acts of Parliament; but hitherto the public have had no means of ascertaining who was entitled to be called an actuary. This will now no longer be the case; but the rule may be distinctly laid down, that an actuary is a Fellow of the Institute of Actuaries, or a Fellow of the Faculty of Actuaries in Scotland, and that no other person can properly take to himself the title. This would not have been the case, but for the fact that the important section of the profession, which for many years kept aloof from us, have now joined us in a body. This is, in my opinion, an event on which both the Institute and the Actuaries’ Club are to be congratulated; and I do not doubt that the union thus accomplished will prove advantageous in various ways to all parties concerned. By the grant of a Charter, a fundamental change has been made in the society, composed of Centenary of the Royal Charter of 1884 227 gentlemen associated together for the purpose of promoting the study of the theory of life insurance; but it is now a professional body, publicly recognized as representing and entitled to speak in the name of the actuaries of the United Kingdom. It is impossible at present to say exactly what duties will devolve upon it in consequence of this change in its constitution—what steps may hereafter be taken, to enable it to protect the public from being preyed upon by unqualified men professing to be actuaries, or to exercisediscipline over members of the profession. I am sure, however, I shall have the sympathy of all the members, when I express the hope that, whatever new duties may devolve upon the Institute, these will be found to be not inconsistent with the continued discharge of the useful functions with which its name has been so long connected. Reconciliatory dinners were held by the Institute and the Actuaries Club, and the hatchet was eventually buried when an F.I.A. was elected to the Club. The Actuaries Club continues to be the social meeting place of senior actuaries, but the discussion of business practices was to pass to the Life Offices Association (founded in 1889) and the collation of mortality experience to the Continuous Mortality Investigation Committee. Sutton’s work for the Institute was not yet done: he drafted the original Bye-Laws in 1885, and designed the Institute’s seal as well as revising the Syllabus of examinations.