§ MR. ARTHUR HENDERSON (Durham, Barnard Castle)I beg to ask the Prime Minister whether, in view of the amount of suffering caused by the present state of unemployment, he can now state what the Government proposes to do to alleviate the distress, and when a day can be given to discuss the subject.
§ MR. MYER (Lambeth, N.)Seeing it is obviously unfair that the incidence of the relief rate should be imposed on the poorer districts in which the unemployed now congregate, will the Government 1160 consider the desirability of placing it on a broader basis?
§ MR. ASQUITHMr. Speaker, the statement which I am about to make I can only make with the indulgence of the House. I obviously cannot anticipate the legislative proposals which the Government intend to make at the beginning of next session to deal with the permanent causes and conditions of unemployment. I shall not, therefore, to-day attempt to lay down any of the principles which, when the problem itself has to be faced, will of necessity require careful statement and be properly subject to criticism and review. I will only ask the House to accept my assurance—made in the name and on behalf of the Government—that we do not mean to shirk any of the larger issues which will then be raised. For the moment, in answer to the hon. Gentleman's Question, we have to deal with a special emergency—not, as I shall hope to show, unanticipated and unprovided for, but calling for direct and immediate treatment, without prejudice to our ultimate policy. The situation is a grave one. No one is less disposed than we are who sit upon this bench to minimise its dimensions or to dispute its urgency. From causes, some of which are obvious and admitted and others disputable and obscure, there has been brought about—not in this country only, not in this country mainly, but throughout the allied and interdependent areas of the world's industry—a temporary dislocation of the machinery of production; and the result is visible in an increase of unemployment—not, indeed, beyond precedent, but substantially in excess of anything that we have experienced for some time past. There are faint, but welcome, signs on the horizon which encourage the belief that the existing distress, though acute and widespread, may be short-lived. But be that as it may, without attempting any numerical estimate—which at the best can only be a rough conjecture—there can be no doubt, I think, that during the present autumn and winter, if nothing is done, we shall be face to face with a large body of industrious men and women who, through no default of their own, find for the time no demand for their labour in the ordinary market, 1161 and who, unless steps be taken, must be compulsorily reduced to idleness and want. Sir, I need not say—speaking for a moment on behalf of the whole House—they have our profound sympathy. They have a right to demand, and it is our duty to give them, something more.
The first, and in some ways the most important, part of the statement I have to make relates to what has been done and is being done by the Government and the local authorities. The likelihood of such an emergency as now confronts us was months ago foreseen. From the beginning of the summer—I may say even earlier—my right hon. friend the President of the Local Government Board has been assiduously urging the necessity of those in authority in the areas of probable distress making special preparations, both in the acceleration of work for which they had already power to raise money, and in setting on foot fresh works of public utility for which new borrowing powers would be required. My right hon. friend has been exposed in these matters to a great deal of criticism, and, I think, to a good deal of misunderstanding, and I want to take this opportunity of saying—and I speak from constant personal communication with him during the whole of this time—that he has been lavish of time and labour. He has sacrificed his leisure—practically, I may say, the whole of his holiday—day and night, week after week, and month after month, He has been, with all the energy which the House knows and admires, putting his whole soul in trying to prepare and provide for the emergency which now prevails. I will not go much into figures, but let me summarise, as briefly as I can, the result of what has actually been done, and is being done. First of all, I will ask the House to compare the figures for the amount of loans to local authorities for works of local utility sanctioned by the Local Government Board in three successive years between the months of June and October. In 1906 the amount so sanctioned was £3,530,000. In 1907 it was £3,589,000—no substantial difference—but in the present year it rose to £4,388,000. In other words, in round numbers there was an increase in the loans sanctioned 1162 during those four months to public authorities in the present year of no less than £800,000. But there is a more significant and instructive figure still. I ask the House next to take into account the number and the amount of loans in which the employment of the unemployed in the localities was expressly the object of the application. I take the months between August and October. In 1907 the number of loans falling within that category applied for was five, and the amount of money applied for £3,560. In the same months of the present year the number of applications rose to ninety, and the amount of money applied for to £719,000. That, I think, shows, on the one hand, the growing sense on the part of local authorities of the distress and emergency which they have to provide for, and, on the other hand, an equally strong disposition on the part of the Local Government Board to meet their reasonable requirements. But I must not stop there. On 21st October—within the first three weeks of this month—the loans applied for in the same way on a similar footing, and either sanctioned or awaiting sanction, amounted to £547,000, and there are still on the list to be dealt with—and they will be dealt with, I am certain, with my right hon. friend's usual promptitude—applications for £326,000. Add these figures together and the House will see that, starting from the month of August last and taking the moment at which we are now sitting, a sum of no less than £1,500,000 will have been added to the resources of the local authorities for the purpose of dealing mainly and substantially with unemployment. That is absolutely unprecedented in any previous Parliament. Even so, that does not complete the account. I spoke a moment ago of the acceleration of works under loans which have been sanctioned. Here in London and the Metropolitan area, and largely owing to the advice of my right hon. friend the President of the Local Government Board, there has been or there will be within a very short period, a commencement of works which would otherwise have been deferred to next year or perhaps a later date. I am only taking two or three instances—one, the Water Board and the construction of their reservoir, involving £520,000; another, the Wandsworth 1163 Infirmary, involving £100,000; and in the case of the London County Council—which I am glad to see is moving in this matter, and moving, I hope, strongly—there is a sum which is not at this moment defined, but which, I am sure, will be substantial.
This special provision has been made in the course of this summer by local authorities, with the co-operation and sanction of the Local Government Board, to meet this special emergency, and I will ask the House to observe two things. These loans, the amount of which I have given, have been applied for and sanctioned on a double footing; first, I will not say with the sole object, but with the main and governing object that the large expenditure which is to be so incurred should be the employment of unemployed labour in the localities from which the applications came; and, in the next place, what is equally important—perhaps more important—that the work to be undertaken under the loans sanctioned should be work to be commenced at once, or, at any rate, without the interposition of any avoidable delay, so that the money can at once pass into circulation and become an effective wages fund for the employment of those at present in idleness. The House may ask on what kind of works this very large sum of money so sanctioned and borrowed is going to be expended, and that I think is a very important point. There is the broadest possible distinction, even when you are dealing with a temporary emergency, between spending money upon what I may call made work—work artificially called into existence, to glide over an emergency of the moment, which will leave no permanent result in the interests of the community—and work of real and permanent public utility. The great advantage of proceeding on these lines is that the money borrowed under the sanction of the Local Government Board is expended upon works for which the local authorities, either under their local Acts or under the provisions of the general law, are empowered to spend the money of the rates—on works like sewerage, drainage, street improvements erection of baths, the laying out of recreation grounds, the provision of installations for electric lighting, and all 1164 the various other channels by which, in these days, municipal enterprise finds a productive and fertilising outlet. Although I do not profess to be sponsor—who could?—for the wisdom and prudence which have guided the expenditure of money in any particular case—I have no doubt that here, as elsewhere, mistakes have been made, money has been squandered, a due sense of proportion has not been maintained—yet, if you look, as I hope the House will have the opportunity of doing when the return is presented, through the works upon which this sum of money is going to be expended, you will find that it is substantially work which will inure to the permanent benefit of the community in whose area it is being undertaken.
There is another thing to say as to the cost of these works. The money has been borrowed upon loans of varying duration, but for the most part they are short loans, and the cost of repayment both of the annual interest and sinking fund, and ultimately of the principal, falls upon the rates. Therefore the whole burden of this expenditure—I am not speaking for the moment of the contribution from the Central Fund—in so far as it is defrayed by the sums raised out of loans, falls upon the rates of the localities concerned. I have said already that it is a condition of these borrowings and of works sanctioned under them that the business should be begun at once or without delay. The inducement, or one of the inducements at any rate, held out to the local authorities, and for which they in terms stipulate as a condition of their applying for those loans, is that out of the Central Fund—the fund voted by Parliament at the end of the financial year—the Local Government Board will contribute a sum in respect of each set of works which, roughly, represents the difference between the value of contract labour and the value of the unemployed labour which they are specially designed to meet. It is only in that way, by making good that difference out of the Central Fund, that you can provide a sufficient inducement in some cases—I will not say in all—for the work to be undertaken. It is, of course, further to be observed that these loans, which, as I have said, are a burden on the rate—
§ MR. A. J. BALFOUR (City of London)Can the right hon. Gentleman, say what the estimated difference will be?
§ MR. ASQUITHIt is extremely difficult to say until the end of the year. It varies between 5 per cent. and 40 per cent. in different places. It is really extremely difficult to say, and I do not believe any figures given at this moment would be of real value or instruction in arriving at a conclusion on that point. It depends, as the right hon. Gentleman will see at once, very largely on the character and quality of the labour that is employed, and upon the extent to which you can resort to the ordinary labour market and get men accustomed to the work to do it or you have to go outside. I made careful inquiry into that question myself, and I cannot say myself, the range is so wide, what the difference will be until we get to the end of the financial year. But I was going to add—not that I complain of the right hon. Gentleman's interruption—that these loans, which in themselves are a burden on the rates, have been and are being supplemented by large voluntary contributions—in Glasgow, for instance, £35,000; in Leeds and Manchester no less than £20,000 in each case have been subscribed.
Now, Sir, in view of these facts, which I have recited in the baldest possible way to the House, I think it is impossible to say that the municipalities of the country as a whole have not shown themselves alive to their responsibilities in this matter. It has been suggested, and suggested in various quarters which are entitled to the greatest possible respect, that local authorities should be empowered by fresh legislation to raise a rate, not exceeding 1d. in the £, for the direct employment of unemployed labour. Some such provision was to be found in the Bill introduced by the right hon. Gentleman the Member for South Dublin four or five years ago, but it was ultimately dropped when that measure was passing through the House. In so far as the proposal proceeds on the view that national assistance—I will not say exactly or even proportionately—ought to be conditional on local activity, it is impossible not to sympathise with it. 1166 I think myself very strongly that we ought to be very careful and chary in giving a contribution out of the Central Fund to a locality which has not shown, in one way or another, its determination to do its best to the extent of its own resources to assist its own local people. But, without going into any question of principle—because we are dealing with a special emergency which calls for special treatment—the Government, after the most careful consideration, and viewing the matter in all its aspects, have come to the conclusion that the circumstances do not call for such a change in the law. I should like to make clear what are the grounds which have led us to that conclusion. In the first place, as far as we are aware, no municipality in this country has asked for this power. They have, as I have shown, been in communication for three or four mouths with the Local Government Board. They have applied for these loans and got sanction for them on the ground that in their view—I do do not say that as the law now stands they were not constrained to take that view—that was the proper method. But they have never suggested that they desired, in lieu of the policy of loans, a policy of rating themselves. On the contrary, the representations which I have received—and I have received a good number from the municipalities, and certainly the leading municipalities—have all been in this sense, that the emergency is such as to call upon the Government to deal with the matter on what they call national lines—that is to say, not to increase the burden that falls on the local community, but, as always happens in these days, to call upon the taxpayer, the central authority, to make good whatever the deficiency may be. But there is a more serious point. We have examined the facts very carefully, and we have come to the conclusion that if you gave this power to rate up to a 1d. it is extremely doubtful whether it would be largely taken advantage of, and, therefore, whether it would really be productive. What we want in these circumstances is money. We do not want an academic declaration on the Statute-book either of a principle or anything else. This is a matter of business, and we want to get money, if we can, from the right source. If you take what is called 1167 the distress districts, those in which unemployment really prevails, and exclude London, the total possible yield of a 1d. rate would not exceed £200,000. If you add London, a possible 1d. rate in London—I do not know whether the London County Council would like to levy it, but assuming they did, the yield would be £170,000. That is a total of £370,000.
§ MR. REMNANT (Finsbury, Holborn)It would realise over £200,000 in London.
§ MR. ASQUITHI am told £170,000. Let us call it £200,000 and make the total £400,000, instead of £370,000. But these places are not going to rate themselves both ways. That is quite certain. If they have applied—and the great bulk of the distress districts have applied—for loans, the burden of which as I have shown, in respect of both principal and interest, must be made good out of the local rates, it is not at all likely that they are going to add to that the burden of a 1d. rate in order to provide a comparatively small addition to the resources which would otherwise be at their disposal. Further, I want to deal with this matter as a matter of business, and I can assure the House, and particularly some hon. Members below the gangway who attach great importance to this proposal of a 1d. rate, that I am looking at this purely as a matter of business, and with the sole object of dealing in the best way we can with the emergency we have got to face. You will get a great deal more money for the purposes which are immediately before us in the present winter, for the purposes of the next three or four months, out of your loans than you will get out of a 1d. rate. I have got here a list, which I shall be glad to have printed if the House likes, of twenty-four boroughs which include, I think, almost all the most necessitous and also very large municipalities, like Manchester, Leeds, Liverpool and Salford. If you take these twenty-four boroughs and add up the produce of a 1d. rate levied in each of them, you will find that that comes, roughly speaking, to £63,000. Thus, after allowing for Manchester, which produces £17,000, Liverpool, which produces £18,000, and Leeds, which produces 1168 £8,000, the total produce of a 1d. rate in these twenty-four boroughs would not exceed £63,000. In those very boroughs—I do not say in all of them, some of them have not applied at all—the loans sanctioned or contemplated between June and this present month of October amount to £602,000. In other words, they have placed at their disposal through the machinery of loans for the purpose of dealing with the exceptional circumstances of the country, nearly ten times as much as they would get from the produce of a 1d. rate. And let me add this—a not unimportant fact when you are dealing with this, as I say, as a matter of business, as an expedient to deal with a temporary emergency—that many of these places are places where the rates are already very high. They run up to 9s. 8d. and 9s. 10d. in the £ and, knowing as one does, human nature, and especially rate-paying and rate-imposing human nature, I suspect it would take a very long time before you could induce the governing body of one of these really necessitous areas to add to the burden of the rates for a temporary emergency a comparatively insignificant sum when, by the loans machinery which has been resorted to, they can provide much better for their wants. I have said so much on that point because I know it is one to which great importance is attached, and because it is one on which the judgment of the country ought to be determined, not upon academic grounds, and not upon grounds of dry economics, but upon practical and businesslike grounds. The Government have satisfied themselves that for these three, four, or five months which lie before us you will make a more adequate provision out of local resources to deal with the problem of local unemployment by resorting to the machinery of loans than you would if you adopted a 1d. rate.
The House may well ask, What are the Government themselves doing, and what do they intend to do? Well, first of all, I will say a word about what has been done, or what is going to be done, by the Government Departments, because they have great responsibility in this matter. The Post Office, a very large employer of labour—probably the largest in the kingdom—in addition to various minor 1169 reforms in regard to overtime and so on, for the special purpose of dealing with this matter is taking on during the Christmas season, for the extra work which falls upon it at that time of the year—is taking on as it did last year—8,000 men, so far as possible men who are genuinely unemployed, largely obtained through the Central Unemployed Body of London, at wages which, owing to the action of my right hon. friend, have been raised from 20s. to 24s. a week. That may seem a small thing, but it is an important thing as far as it goes; and my right hon. friend, very wisely, if I may say so, has sought to extend the area of action in this matter by taking steps to provide with similar employment for these special seasonal purposes the unemployed in the great provincial centres of population.
Then I come to the War Office. Let us see what that Department is doing. The replacement of the Militia by the Special Reserve has largely increased the amount of military employment in the winter months. A Special Reservist under the new system has only a fortnight's summer camp; but he does six months drill on enlistment, so that if he enlist early in the autumn, as the War Office encourages him to do, he is provided for throughout the winter. The War Office is prepared to take at least 24,000 recruits in the Special Reserve between now and March. We have got 5,000 already, and they are coming in faster, I am glad to say, week by week; and the War Office has decided, very wisely, to widen the choice of the intending recruit by throwing open the Army Medical Corps and the Army Service Corps, as well as the combatant branch, so that they may have a wider area of employment. If you take the lowest rank in the worst-paid arm, the emoluments are 1s. a day in cash, in addition to rations, and in addition to four payments by way of bounty of £1 each. If the 24,000 men whom the War Office want will join, that Department will spend during the winter of this year something nearly approaching £200,000. That is a very substantial addition to the provision made for the unemployed.
Now I come to what is, perhaps, more important—the action taken by the 1170 Board of Admiralty. At Portsmouth, Devonport, Chatham, Sheerness, Pembroke, and Haulbowline 2,100 men are to be specially engaged for repair work, which in the ordinary course would not have been undertaken this year. Those who have been previously employed in the yards will have first consideration, and their engagement will terminate on 31st March, 1909. The cost of that is £73,500. Tenders have been accepted for the construction of nine destroyers. According to the programme foreshadowed in the early part of the year these tenders would not have been accepted before the end of November. It is not advisable to disclose the exact amount of money involved, but it may be stated to be very nearly £900,000. Tenders for five unarmoured cruisers have been called for and are due on 5th November. According to the programme these orders would not have been placed until January, 1909. It is now hoped to place them by 26th November, possibly some of them by 15th November. The total of these tenders will certainly exceed £1,500,000 sterling. These orders meaning, as the House will see, £2,500,000 will be placed this year upwards of six weeks in advance of the time orginally proposed. Ante-dating the programme in this way by six weeks, and in some cases two months, means that, presumably, £200,000 more will be spent this winter by the contractors in executing the orders than would have been the case under the original programme. These orders will be distributed between the different shipbuilding centres, so that, as far as possible, they may fairly share them.
Now let me come, in conclusion, to the central grant, which is directly paid out of the taxation of the country. Apart from the function to which I have already referred—that of making good, in the case of these municipal loans, the difference to the local authorities between what may be roughly described as contract and casual or unemployed labour—the central fund is applicable to two main purposes. In the first place, it can make grants to localities which are too poor to borrow or to borrow on any adequate scale. There are many such, and we know it is most desirable that where the rateable capacity of a locality 1171 is so low and at the same time its congestion of population and of unemployed is so great that ordinary conditions cannot be said to exist, the special fund should be allocated to that particular purpose. Another purpose to which the central fund can be applied is to pay for the employment of labour for purposes other than those for which loans are or can be sanctioned, but which fall within the scope of municipal enterprise. This is largely done by the Central Unemployed Body of London, a body to which I desire to pay a hearty tribute of gratitude and sympathy for the admirable work which it has done in the course of the last three years. We propose to increase the amount of the central fund. It is almost impossible at this moment to forecast with anything like precision what sum will meet the full necessities of a situation which is not yet fully developed. We propose in the first instance to double the amount of the central grant which was actually expended last year, which will bring us at once to an available figure of about £300,000. I do not pretend to predict the future in regard to that; but we are not content with increasing the amount of the central grant. We think a clear case of necessity has been shown for rendering more elastic the provisions and conditions under which it has been distributed. We propose to give the most elastic and most liberal interpretation possible to the character of the work which is to be aided out of the grant. When you are dealing with a special emergency like this, I am satisfied, as I believe everybody who hears me is, that you may stretch the limits which quite properly from a business point of view would be imposed when conditions were more nearly normal. Further, with regard to the special conditions under which this grant is administered, we propose they should be relaxed in two important particulars—first, so as to allow assistance to be given, in proper cases, to persons who have been receiving Poor Law relief during the last twelve months, who are at present excluded; and in the second place—and I think this equally important—so as to remove the disqualification of persons who have been assisted under the Act in each of the last two years. With those 1172 three modifications, elasticity in the character of the work and the removal of the disqualification in respect of Poor Law relief and assistance during the last two years, I believe the main objection which has been taken and the main criticisms of the present administration of the grant will be effectually removed.
May I add how much can be done at a time like this, in addition to anything that the Government or local authorities can do, by landowners and well-to-do people in every walk of life, not merely by benevolent contributions, but by anticipating and accelerating work which in the normal course of things would have to wait until a later date to be carried out? The proposals which I have laid before the House on the part of the Government, I need hardly say, even for the purpose of dealing with the emergency in front of us, make no pretence to the character of finality. If and when the necessity should arise we shall be perfectly prepared to consider in what direction and to what extent they may need to be supplemented. But we believe them to be both adapted and adequate to foreseeable needs; I am sure that as we are in the presence of a national misfortune they will not be canvassed in the spirit of Party. Like all expedients of the kind they are little better than anodynes to produce temporary relief, which do not go down to the root of the evil. And we submit them merely as such, and with the hope and the intention that before this Parliament ends its labours we may be able to strike a real and an effective blow at the permanent causes of unemployment.
§ MR. A. J. BALFOUR, on behalf of the Opposition, thanked the right hon. Gentleman for his extraordinarily clear statement, and asked how soon he proposed to give the House an opportunity of discussing the matters he had brought before them. So far as he was concerned he did not want the day to be fixed too soon, not this week, nor perhaps next week. [LABOUR cries of "Oh!"] He would give his reasons. The right hon. Gentleman had necessarily travelled over a very wide field and had referred to questions of extraordinary interest and intricacy. They would enter 1173 on the discussion far better equipped for debate if they were allowed some time to think over the right hon. Gentleman's statement and by Question and Answer to elicit replies from the Ministers concerned which would make them thoroughly acquainted with the proposals of the Government. Therefore, although he was the last person to wish to see the discussion delayed, he thought they ought to be allowed a few days before they approached the most complicated and most important question with which it was possible for the House to deal.
§ MR. ARTHUR HENDERSON (Durham, Barnard Castle)desired to say on behalf of his colleagues how thankful they were that the Prime Minister had made a clear and definite statement on this important subject. He was not in a position at the moment to venture any opinion as to whether the proposals were adequate or satisfactory, but he would urge the importance of a day being granted for their discussion much earlier than had been suggested by the Leader of the Opposition. The question was of extreme urgency; and on behalf of his colleagues he would urge that Monday next should, if possible, be fixed as the date of the discussion.
§ MR. JOHN O'CONNOR (Kildare, N.)asked whether in his survey of distressed localities the Prime Minister had taken Ireland into his purview. Had he taken steps to ascertain the amount of unemployment in Dublin, Limerick, Cork, and elsewhere, and would those plans be taken into account in the administration of the central fund.
§ MR. ASQUITHasked that he should have notice of Questions relating to Ireland. With regard to the date of the discussion, the Government would like to consult the general convenience of the House. He would not commit himself at the moment to any particular day, but he confessed that the inclination of his own opinion was to take the discussion on an early day, because it was obviously a matter of urgency and should be discussed as soon as possible.