HC Deb 24 November 1911 vol 31 cc1651-88

(1) The sums required for the payment of unemployment benefit under this Act shall be derived partly from contributions by workmen in the insured trades and partly from contributions from employers of such workmen and partly from moneys provided by Parliament.

(2) Subject to the provisions of this part of this Act, every workman employed within the United Kingdom in an insured trade, and every employer of any such workman, shall be liable to pay contributions at the rates specified in Part I. of the Eighth Schedule to this Act.

(3) Except where the regulations under this Part of this Act otherwise prescribe, the employer shall, in the first instance be liable to pay both the contribution payable by himself, and also on behalf of and to the exclusion of the workman, the contribution payable by such workman, and subject to such regulations shall be entitled notwithstanding the provisions of any Act relating to truck or any contract to the contrary, to recover from the workman by deductions from his wages or otherwise the amount of the contributions so paid by him on behalf of the workman.

(4) Notwithstanding any contract to the contrary the employer shall not be entitled to deduct from the wages of, or otherwise recover from, the workman the contributions payable by the employer himself.

(5) Subject to the provisions of this Part of this Act, the Board of Trade may make regulations providing for any matters incidental to the payment and collection of contributions payable under this Part of this Act, and in particular for—

  1. (a) payment of contributions by means of adhesive or other stamps affixed to or impressed upon books or cards, and for regulating the manner, times and conditions in, at and under which such stamps are to be affixed and impressed;
  2. (b) the issue sale custody or delivery up of books or cards and the replacement of books or cards which have been lost destroyed or defaced.

(6) A contribution shall be made in each year out of moneys provided by Parliament equal to one-third of the total contributions received from employers and workmen during that year, and the sums to be contributed in any year shall be paid in such manner and at such times as the Treasury may determine.

Mr. SIMEON (the Clerk)

It is my duty to read to the Committee the Resolution of the House of July 7th last as follows:—

"That for the purposes of any Act of the present Session to provide for insurance against loss of health, and for the prevention and cure of sickness, and for insurance against unemployment, and for purposes incidental thereto, it is expedient:—

(1) To authorise the payment out of moneys provided by Parliament of—

  1. (a) Sums not exceeding two-ninths (or in the case of women one-quarter) of the cost of providing the benefits specified in Part I. of such Act and of the administration of those benefits, together with—
    1. (i.) as respects medical benefit, one-half of any excess expenditure on medical treatment and attendance (including the provision of medicines) for insured persons which may be sanctioned by the Treasury;
    2. (ii.) as respects sanatorium benefit, including research work in connection therewith, a sum not exceeding one penny a year for every insured person;
      3. 1653
    3. (iii.) as respects benefits for persons who have been in the naval or military service of the Crown such additional sums as may be provided by the said Act;
  2. (b) A contribution not exceeding one-third of the total contributions received from employers and workmen in any year towards the cost of unemployment benefit and other payments to be made out of the unemployment fund established under Part II. of the said Act, and of a contribution by way of repayment to associations of persons of a part (in no case exceeding one-sixth) of the aggregate amount expended by such associations in payments to persons while unemployed; and
  3. (c) The salaries and remuneration of any commissioners, umpires, referees, and other officers and servants appointed in pursuance of such Act and other expenses incurred in the execution thereof;

(2) To authorise the Treasury to make for the purposes of Part II. of the said Act advances out of the Consolidated Fund, and to borrow money for such advances by the issue of Treasury bills or Exchequer bonds, the principal of and interest on such Exchequer bonds to be charged on and payable out of the Consolidated Fund."

The CHAIRMAN

The Amendment standing in the name of the hon. Member for Blackburn (Mr. Snowden) is clearly out of order. It would increase the charge and is contrary to the Money Resolution just read by the Clerk.

Mr. RAMSAY MACDONALD

On a point of Order, and not so much in respect to this particular Amendment, but in reregard to a general ruling, cannot such Amendments be put that the employé is prepared to accept reduced benefits so that the mere reduction of the contribution on the part either of the employer or the employed—

The CHAIRMAN

When I called attention to the Amendement I did not notice that the hon. Member for Blackburn is not a member of the Committee.

Mr. RAMSAY MACDONALD

I think he is.

The CHAIRMAN

Does the hon. Member for Leicester propose to move the Amendment?

Mr. RAMSAY MACDONALD

I understand that you rule the Amendment out or order.

The CHAIRMAN

The Amendment on the Paper is out of order, for the reason I stated.

Mr. RAMSAY MACDONALD

My point of order is that in respect of this Amendment it need not necessarily be out of order, because it may be consequential to Amendments on the Schedule reducing their benefits, and that therefore an Amendment of this character reducing the contributions of either employé or employer need not be out of order in consequence of the Financial Resolution passed downstairs.

The CHAIRMAN

I need not have referred to the matter at all, as the hon. Member for Blackburn is not here, but I thought it right to do so, because I thought it possible that some hon. Member might wish to move the Amendment. Does the hon. Member for Leicester propose to move the Amendment? If so, then I will rule upon the matter.

Mr. RAMSAY MACDONALD

In order that we may get your ruling, I beg to move in Sub-section (1) to leave out the words, "partly from contributions by workmen in the insured trades and partly from contributions from employers of such workmen and partly."

Mr. SCOTT DICKSON

Is there any consequential Amendment on the Schedule, because we need to see that?

The CHAIRMAN

My ruling is perfectly clear, because the Amendment as it stands upon the Paper is one that throws the whole burden upon the contributions made by Parliament. I rule that the Amendment is out of order. When an Amendment is moved to the Schedule I will of course consider whether that Amendment is or is not one which imposes an additional charge.

Mr. RAMSAY MACDONALD

I am very sorry to press the point, but it is rather important. The Committee has not yet decided what the benefits are to be. The benefits may be altered by any Amendment we may put down on the Paper, and the point I respectively ask you to reconsider is that until we have settled the benefits the mere alteration of what the employer is to pay or the employé is to pay has no reference whatever to the Financial Resolution that was passed downstairs.

Mr. WORTHINGTON-EVANS

On a point of Order, according to the Financial Resolution, Parliament is to contribute one-third of the contributions made by the employer and by the workmen. The hon. Member's Amendment is to knock out the employers' and the workmen's contributions. That would leave Parliament to contribute one third of nothing, which is absurd.

Sir E. CORNWALL

Would not the proper course have been for the hon. Member to move that this particular Clause should be postponed until some other part of the Bill has been dealt with, and not to press you to accept an Amendment now which is prima facie out of order.

The CHAIRMAN

My ruling is that the Amendment proposed to be moved by the hon. Member for Leicester is out of order. It will impose upon the Government a larger contribution than is provided by the Money Resolution. That is quite sufficient for my present ruling.

Mr. HUGH BARRIE

I beg to move in Sub-section (2) to leave out the words "The United Kingdom" and to insert instead thereof the words "Great Britain."

I move this Amendment chiefly in order that we may now have a statement from the Government as to the Amendments which the Leader of the Irish Nationalist party intimated the other day in the House had been agreed upon. At present we have no information regarding the Amendments that we understand are to be presented either by the Leader of the Nationalist party or by the Government. We want to know the alterations which the hon. and learned Member for Waterford (Mr. John Redmond) said the other day he took for granted that the Government were prepared to accept. I do not think it is necessary at this stage to point out the peculiar position in which we Irish Unionist Members find ourselves in reference to this Bill. We know that substantial and far-reaching Amendments are to be accepted by the Government. We have certain Amendments dealing with Clause 59 to come before the House very shortly. Now we are asked to deal with a later Clause. Our whole attitude to this Bill must be largely governed by the Amendments that we understand have been agreed upon between the Government and the Irish Nationalist Party. While I formally move the Amendment, I have no desire to press it to-day, because our real attitude towards the Bill must finally depend upon the nature of those Amendments. I move the Amendment now in order that we may have a statement from the Government as to their whole attitude to Ireland regarding the provisions of this Bill.

Mr. BUXTON

I understand from the remarks of the hon. Member that he chiefly refers to Part I., because the Amendments to Clause 59 deal with Ireland, and will be put down in reference to that particular Clause. As regards Part II. no Amendments have been put down, except that of the hon. Member, which is to exclude Ireland from the operation of the Bill. I propose to include Ireland in the general provisions of the Bill for reasons which, if it is necessary to give, I can easily do so. If the facts show that there are special provisions necessary in regard to Ireland I will carefully consider them. As at present advised, although it may be possible in the course of this Committee that I shall have to meet special cases, I should rather hope that such Amendments as deal with those difficulties that arise indifferent parts of the United Kingdom may be made by general Amendments rather than by one applying specially to Ireland. That is a matter for consideration, and I shall be glad to have the opinion of hon. Members interested in Ireland, or in rural districts, in order to see how far we can go. My general opinion is that Ireland should not be excluded from the benefits of this Act, and therefore we put in the words "United Kingdom" which the hon. Member proposes to exclude.

Mr. JOYNSON-HICKS

The right hon. Gentleman has not told us whether there are any Amendments suggested to him by the hon. and learned Member for Waterford. We understood the hon. Member to say in the House the other day that he was going to suggest Amendments to this Bill which he took it for granted would be accepted. I am bound to say that I took it for granted that any Amendments the hon. Member for Waterford suggested or insisted upon are bound to be accepted by the Government. We are entitled to ask the President of the Board of Trade a question with regard to this matter, because we want to know what this part of the Bill is going to be, and whether the hon. Member for Waterford has suggested to him any Amendments which we may take it for granted will be accepted.

Mr. MITCHELL-THOMSON

This Amendment is not one that can be persisted in at this stage. It is clearly necessary that we must see the Bill in its final stage before we decide what to do. Neither the hon. Member for Waterford nor any member of his party has any Amendment on the Paper with regard to this part of the Bill. Therefore we are in a position of some difficulty. We do not know what their views are. The right hon. Gentleman will see that there are in Ireland, as there are in some rural parts of England, and particularly in the Highlands of Scotland, where the conditions approximate to the conditions in Ireland, difficulties that will undoubtedly have to be faced at some time or another under this Bill. I want the right hon. Gentleman to realise that fact, then we shall be in a position to say whether we consider the Amendments he suggests meet the case. If they do not meet the case we shall recur to this Amendment and place greater insistence upon it.

The CHAIRMAN

Does the hon. Member (Mr. Barrie) insist upon the Amendment?

Mr. BARRIE

No, I do not think it is advisable, but I must express my disappointment even now that we are not to have a statement as to the final decision in regard to this part of the Bill. The President of the Board of Trade said, that so far as he was aware no Amendments were to be brought on for this part of the Bill by the Nationalist Party. I can only express my surprise if that is so. [HON. MEMBERS: "No."] I understood the right hon. Gentleman to say so. I can understand many reasons which may be urged in favour of the first part of the Bill, but I have yet to hear any substantial reason why agricultural Ireland would desire in any shape or form to be saddled with this.

Mr. DEVLIN

I think it would have been a much more courageous course for the hon. Gentleman to adopt if he had moved the Motion in the name of his colleague, who had not the courage to come here and move it. So far as we are concerned, Ireland is in favour of being included in this scheme; there is not a single body in Ireland which has spoken against it; the whole of Ireland is in favour of it being included in the provisions of this Bill. We will submit our case when it suits our own purpose.

Mr. BONAR LAW

I certainly am glad my hon. Friend has withdrawn the Amendment. [HON. MEMBERS: "No."]

The CHAIRMAN

I asked the Committee whether it was their pleasure that the Amendment should be withdrawn, and the hon. Member (Mr. Devlin) rose apparently to oppose the withdrawal.

Mr. BONAR LAW

I hope it will be withdrawn, if for no other reason than that I have a connection still with Glasgow, and I should not like to see Glasgow shipbuilders handicapped by a burden which was not borne by Belfast. I am sure every Member of the Committee will agree that the speech of the hon. Gentleman (Mr. Devlin) confirms in every particular the speeches which have recently been made by the hon. and learned Gentleman (Mr. John Redmond) that we can rely absolutely on the tolerance of the majority towards the minority.

Amendment negatived.

Mr. PETO

I beg to move in Subsection (2), after the word "workman" ["and every employer of any such workman "], to insert the words "save and except such employers and workmen as are engaged in carrying out any engineering or building contracts that were entered into or commenced prior to the passing of this Act in respect of such contracts."

This Amendment will probably meet with the sympathy of the right hon. Gentleman in charge of the Bill, because it is absolutely required to meet a very obvious hardship, and is one which is on the lines certainly of precedent in other matters of taxation. My attention has been called to the fact that the moment this Bill is passed it obviously imposes a charge for every workman upon every employer who is employing men. In an ordinary trade where the work is of a small character—in an engineering shop—that does not produce any hardship; but take the case of large building contracts, large engineering contracts. Work of great magnitude is taken on a tender which has already gone in, and the contractor has had no idea that there would be an additional 2½d. per week to be paid on the wages of every man he employs, and a case has specially been brought to my notice of a contractor in the north who has entered into a contract to erect an asylum in Lancashire at a cost of £450,000—very nearly half-a-million sterling. He points out that the passing of this Bill will mean an addition to his liability under the contract of several thousand pounds, of which he had no idea whatever when he entered into the contract. I cannot give the exact date of the contract, but it was entered into before July 8th. There is no desire whatever by the Amendment to do anything to interfere with the operation of the Bill, or to defer it unreasonably, but it seems perfectly obvious that, when an addition is made by Parliament to the amount of the duty we will say on an article like tea, it is perfectly understood in trade, and it is a recognised principle, that any contract entered into for the delivery of tea at a certain price naturally carries with it the power to transfer to the purchaser the increased duty. But I do not think it is possible for a contractor in the case of this Bill, where practically an additional tax—for it comes to the same thing; it is money out of his pocket—is imposed upon him to transfer the cost of that to the person employing him. In the case I have quoted, the employer is an asylum authority in Lancashire. It is perfectly obvious that that would be breaking the contract, and he would have no power to get any revision of the contract in order to meet the increased expenditure. I only wish to deal with the case of large engineering and building contracts which were entered into prior to the passing of the Act, and to say that the Act shall not apply to the employer in respect of those particular contracts, because he would have had no knowledge that he had to provide for it.

Mr. J. WARD

I do not think it will be possible to accept this, and I do not think the arguments used by the hon. Member are so cogent as he thinks. For instance, this gentleman, this northern contractor, is certain to be as acute a business man as the hon. Member himself. He knows perfectly well that within six months from now, by the agreement of any body of workmen there is in the building trade from John o'Groats to Land's End, he may receive a notice for an advance of wages of anything up to one penny an hour—not 2½d. per week. [HON. MEMBERS: "Strike Clause."] The Striker's Clause is only with reference to delay of the work. I have examined hundreds of these tenders, and the hon. Member knows that what I am saying is true. It applies to the delay of the work, and not to the price. The hon. Member will always, I will warrant, being an acute business man, when he enters into a contract, take that into account, and always make provision. If he is lucky enough to get through the job without having a demand for an increase of wages so much the better for him. If he is not lucky enough to get through, so much the worse for him, of course. But anyone can see that provision will have been made, especially in a contract signed so recently as July, by an ordinary business firm for the exigencies of this Act. In addition to that, see what it will mean. Some of these contracts must run, in the case of big public works, into six or seven years. Look at the awkwardness of the situation. There may be some men working on jobs which will be taken a week or a fortnight after this Act comes into operation, and these sets of men working on one part of the firm's work on certain contracts which were arranged before the Act, would not come under the Bill, and no deductions would be made from their wages, but if they worked for a day or two on another part of the firm's work, where the contract happened to be signed within the period of the Act, deductions would be made. It would create untold confusion, and you may take it, there is no great firm that has not made provision to meet a 2½d. advance in the workmen's wages, supposing there could be such a thing as a 2½d. advance per week. If they have not made provision for a considerable sum beyond 2½d. per week, they might be landed into difficulties. Therefore, I do not see any hardship, and I do not see any necessity whatever for the Amendment.

The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. J. M. Robertson)

I should like to point out in addition to what has been said by the hon. Member (Mr. Ward) in regard to any burden which may be imposed by this Act on contractors, that a contractor is not merely, as the hon. Member remarked, facing a risk as in the case of a rise in wages. He is facing an addition to his burden that he really knew would come about. For instance, the knowledge that this Bill was coming has been before the business world for a period of three years. Further, the Bill has actually been before us for six months and the very contract to which the hon. Member alluded has been made since the Second Reading of the Bill.

Mr. PETO

I cannot say positively. I only know that it was prior to 8th July. It may have been before March.

Mr. J. M. ROBERTSON

Let us assume that date. If the contract was made after the Second Reading of the Bill, it was made with a fair expectation that the Bill would be carried, and was no doubt provided for by these contractors. If you now carry the Amendment, you will be making to the contractor, a present of the very provision that he had made. He will be getting the advantage of the arrangement he had made to meet the burden, and we are actually relieving him of the burden. Further, the Bill does not come into operation till May, 1912, and this Amendment again would deliberately invite all sorts of contractors to make this provision on the strength of the Bill passing now, while you allow them to remain free of any burden under any contract made even after the discussion has taken place here. I quite admit that there is an appearance of a burden in the case of an old standing contract, but the lines of the Bill were indicated three years ago in a speech of a former President of the Board of Trade—as early as 1908. We have had a very full indication of the prospect of a rise in wages. Further, as the hon. Member (Mr. John Ward) has pointed out, whatever may be the appearance of hardship to the contractor, the hardship to the workman by the carrying of the Amendment would be immense. The workman would have to pass from an insured to an uninsured job, when he was doing the same kind of work, simply because one job was made under the contract dealt with in this Act, while the other was not. Further, as regards the principle, though there is something to be said for the hardship on the contractor, under the Workmen's Compensation Acts no contracts have been exempted. If the principle of the hardship to the contractor could be raised in this case, it would be raised in that. I think, even in the case of the Workmen's Compensation Acts introduced by the other side, no attempt was made to exclude contracts from the operation of the Acts. In fact, whatever may be said of the apparent hardship to contractors, the proposal is impracticable. It would raise enormous difficulties in administration, apart from the hardship to the workmen, and if the Amendment were carried it would go a very considerable way to stultify the Bill.

Sir ARTHUR GRIFFITH-BOSCAWEN

I really am very sorry the Government are not prepared to meet us in this matter. I quite agree that the actual wording of the Amendment may be capable of improvement, and in the actual shape it takes now might cause a certain amount of confusion, but it cannot be denied that there is a real grievance here. You are putting on employers a very great burden. You are putting 2½d. a week on the top of what has to be paid in the first part of the Bill, and surely in a special case like this, of contracts entered into without the knowledge that the Bill was going to pass, you ought to do something to meet it. For the hon. Gentleman (Mr. J. M. Robertson) to say that every contractor, every business man, knew three years before that this Bill was going to pass, is really playing with the Committee It is nothing else.

It is quite true we have had programmes from hon. Members opposite for years, containing all sorts of wild suggestions which have not passed, and probably will not pass, and because in a programme some three years ago they outlined the possibility that at some time, if they were still in office, they were going to carry an Unemployment Insurance Scheme, to suppose that that could be taken into account all the three years since then is a suggestion not worthy of a Member of the Government. As a matter of fact, this is an entirely new risk. The hon. Member (Mr. J. Ward) quite rightly pointed out that when a contractor enters into a contract it always may happen that after that there is a rise of wages. I agree. But that is an ordinary trade risk, and he takes it into account when he makes his tender. But this is an entirely new risk, which he could not foresee except on the strength of the vague promise made by the Government three years ago. It is quite true that in the instance given by my hon. Friend (Mr. Peto) this particular contract was apparently entered into after the Bill had been introduced. Even if it was, it does not in the least follow that this particular part of the Bill was going to pass. It is quite true that he might have been wise enough to foresee that it possibly would pass, but there are no doubt lots of contracts still running which were entered into before the Bill was brought in, and considering that this is the first Session of a new Parliament, surely in such a case as that—my hon. Friend limited it to that—the Government ought to meet us in a matter of this sort. Whenever some of us, who are in favour of the Bill but realise the large burden it must put upon British industry, have pointed this out, the Chancellor of the Exchequer and others invariably say that it is an ordinary charge upon the industry and the purchaser will put it on the consumer. I have always doubted the argument that in the case of competing goods the cost of a tax on foreign imports cannot be put on to the consumer. I will not go into that now. But in the case of a contract already settled it is clear you cannot. There can be no doubt whatsoever. That entirely breaks down the argument which is always used by apologists of this part of the Bill in regard to that particular point. I would therefore appeal to the Government, while I admit there are practical difficulties in the actual wording of the Amendment, to see if they cannot meet, at all events, the case of those people who enter into contracts before either the Bill was brought in or before it passed.

Mr. MITCHELL-THOMSON

I want to suggest, if I may, that my hon. Friend should slightly alter the wording of the Amendment. So far as the general principle has gone, I think my hon. Friend has completely answered the only two arguments which were brought forward. One was the question of the risk, but this is in a different category from the question of wages. I do not think we need attach very much importance to what I may call the prophecy argument. After all, if we are going on that line we might turn round some years hence and make similar observations with regard, let us say, to the reform of the House of Lords or any other subject of that kind. I do not think really that the hon. Gentleman himself attaches much importance to that line of argument. I quite agree that the actual wording of the Amendment would open the door not only to firms that have entered into contracts since the Second Reading, or the introduction of the Bill, or even up to 12th May, when the commencement of the Act takes place. I would suggest that the Amendment should be amended by leaving out the words "the passing of this Act," and putting in 1st May, 1911, or three days before the Bill was introduced. I think that meets to a certain extent the objection which was made, and in which there was considerable force, by the hon. Gentleman opposite. Let me point out to him and impress upon the Committee that there is not merely one contract of this kind in the country. There are no doubt a great number of contracts, and there are contracts between the Government themselves and contractors. Take, for instance, a contract like the Rosyth contract. In that case Messrs. Easton, Gibb and Co. are engaged making docks under a contract with the Government of this country on the basis of certain estimates which were made some years ago when the undertaking was first commenced. There are still two, three or four years of the work to run. The Government step in and by action of their own actually alter the conditions under which the work is being carried out. I really do not think anyone can say that is fair. I cannot think that the Members of the Committee will not say that an Amendment of some kind is necessary. I think the Amendment as amended would hold water and is urgently required.

Mr. HARRY LAWSON

I quite agree that a very real hardship has been brought before the Committee by my hon. Friend the Member for the Devizes division (Mr. Peto), who moved the Amendment, but I submit that this is not the real remedy for it. I believe the real remedy is to postpone the date when the Bill may come into operation. It seems to me to be a great mistake to hurry the time when making a great social change of this kind. I shall state the reason why I cannot support the Amendment. I do not see why a workman who is engaged under a contract which has been entered into should lose the benefit of the State contribution and lose the benefit which others will receive under this part of the Bill. The hardship is no doubt a great one, but it is almost incidental to all legislation of this kind, and it is a form and method of legislation in which I do not think it is desirable to make exceptions, barring contracts entered into in this way. I do not think it is a good method of legislation, and I would suggest to the President of the Board of Trade that he should postpone the date. In the case of great public works it is not a question of one contract, but of many contracts entered into, and there would necessarily be great confusion if such contracts were excepted. But supposing the date were postponed, that would give greater time during which contracts already entered into might expire. No doubt some contractors would suffer a certain amount of hardship, but it seems to me there is no reason why they should have a windfall in the shape of their own contributions. Therefore, I hope the President of the Board of Trade will be able to deal with the matter in the way I suggest. I do not suppose he will accept the Amendment proposed by my hon. Friend, but I would ask whether he could deal with the matter in the way I suggest by postponing the date. Though that would not do away with every hardship, it would give existing contracts more time.

Sir EDWIN CORNWALL

I really think hon. Gentlemen opposite are attaching too much importance to this matter. We all know that the contracts entered into from time to time carry risks. They carry trade risks, and they also carry many other risks. [An HON. MEMBER: "What risks?"] Well, take the case of the Port of London when a penny per ton was put on coal, and when other charges were put on goods. There were contracts running in the Port, of London.

Mr. MITCHELL-THOMSON

I thought the consumer paid.

Sir E. CORNWALL

Not at all. There were contracts running, and the extra charges could not be put upon the consumers. That is always the case when these large contracts are running. There are all manner of risks, and whether a large contractor makes a profit out of a contract which he has entered into, is a matter that depends very much on a variety of risks, and on a whole concatenation of circumstances in which the trade is concerned. I do not think employers would thank hon. Gentlemen opposite for amending this Clause if the Amendment were carried. How would it work in regard to large contractors in dealing with their men? A contractor does not want to be bound hand and foot in the case of a man who is engaged in one particular part of his work which has the benefit of the unemployment scheme, and who, if he moves from that work to other work, is outside the insurance scheme. I am sure, from the point of view of the administration of the Act by the Board of Trade, and from the point of view of the employer himself, it would be an undesirable thing to carry the Amendment. I am sure it would not work. Hon. Members opposite are not rendering any service to employers by bringing it forward here. I believe every large employer when this Bill passes into law will desire that his workmen should come in. He would be very much interfered with and greatly inconvenienced if some of his men were in the scheme and some were not. Therefore, I think hon. Gentlemen opposite are making too much of this point. No one will thank them for it. It is better that the Clause should remain in its present form, and that there should be no postponement of the date as proposed by the hon. Member for Mile End (Mr. Harry Lawson). Employers are used to these difficulties arising from time to time, and they do not want this assistance.

Mr. BONAR LAW

I do not think there is any need for further discussion on this point, because the matter is one on which all of us have already made up our minds. I have no hesitation in saying that I shall vote for the Amendment. A burden imposed by the State, it seems to me, should not apply to contracts which were made before it was known that this burden would be enforced. The hon. Member who has just sat down (Sir E. Cornwall) pointed out the difficulties in the way. Does he admit that the same difficulties apply to the whole of the Bill, that men will go from an insured trade to an uninsured trade?

Sir E. CORNWALL

My point was that with the same employer and the same workmen going from an insured to an uninsured trade would be so inconvenient.

Mr. BONAR LAW

That is a different point from what I thought the hon. Member was making, but the real difficulty is the same man may go from an insured trade to an uninsured trade and get over the difficulty as best he can. The hon. Member for Stoke's (Mr. John Ward) objection practically amounted to this, that if you are going to sea you run the risk of being drowned, and therefore you should not object to a man throwing you over. As for the hon. Member the Secretary to the Board of Trade (Mr. J. M. Robertson), whom I heartily congratulate on filling an office which I once filled myself, his contribution to the discussion was this, that every manufacturer and contractor must read carefully the speeches every morning and base his tenders on what has been last said by the First Lord of the Admiralty.

Sir JOHN SIMON

I would like to add one word from the Government point of view. I confess I think that the Members of the Committee have a good deal of sympathy with the general position expressed by the hon. Member for Mile End (Mr. Harry Lawson), that in view of the risks and chances of legislative change, which do, we all agree, one way or another closely affect industry, it is a bad principle to say that whenever you make a change you must try to provide for all those who are experiencing the change. The short answer is that you cannot do it. There may be one employer who has paid more attention to the speeches of the right hon. Gentleman opposite than another, or one who has shown perhaps more caution than another, or one man who is a better prophet than another. If this Committee sets itself to endeavour to adjust these inequalities between one contractor and another by putting a clause into an Act of Parliament trying to do it, it attempts something which no legislature could face. When laws are changed it often happens incidentally that some people may find the change hard while others may find it soft. Having said so much for the general principle I should feel some sympathy with the general position of the hon. Member for Mile End, who says that the only way to deal with the problem is to consider whether you have chosen the right time for the Bill to come into force. For my part, I want to say that when the time comes to consider that question these arguments are very material in my judgment, and in that of the Government, to choose a proper time. I do not mean to say that anything which we can do will avoid all hardship, but we want to do the best we can to choose a proper time, having regard to the admitted urgency of the general subject matter.

It is all very fine to discuss this question from the point of view of the contractor who has made out his quotation and has preferred to run a risk rather than provide for emergencies; but what about the working man? After all we are here endeavouring to set up this universal and compulsory scheme within the bounds of its operation not merely in the interests of one part of industry, but in the interests of all parts of industry. The position is absurd if it is said that out of a series of workers living in the same street, engaged in the same work, earning the same wages, and paying the same sort of taxes, because one of them works for a man who happens to have made a contract before a particular date, he shall be treated differently from the others who are not working for such an employer. The analogy pointed out by my hon. Friend the Secretary to the Board of Trade is an analogy so strong that it is extremely difficult to see how this can be regarded as a hard case in comparison with what occurred when the Workmen's Compensation Act was introduced, which put quite a new kind of burden upon the employer. The employer in that case was in this position, that he had in many cases actually contracted with his workers that they should have no claim on him in respect of accident and the Workmen's Compensation Act did not except those employers who had already got running contracts, but actually broke the very contracts the employers had made with their own workmen that the workmen should have no right to compensation. Surely, if to improve the conditions of the workmen you break a contract which a workman has entered into with his own employers it is not unreasonable to say that in the present case the way proposed is a proper way to deal with it. It does occur to me that anybody who descends from the general to the particular and tries to draw a clause dealing with this matter will find it impossible to draw a clause that will work without producing hard cases on one side or the other. With regard to the method of dealing with the matter, which was suggested by the hon. Member for Mile End, that can be considered when the time comes.

The CHAIRMAN

The hon. Member for North Down (Mr. Mitchell-Thomson) has handed in the following Amendment to the proposed Amendment, to leave out the words "passing of this Act," and insert instead thereof the words "1st of May, 1911."

Sir HENRY NORMAN

There is one point which I do not think has yet been mentioned. An employer who is not insured will find great difficulty in finding the best workmen to go into an uninsured contract, and a man might leave his employment to go into an insured contract, so that the employer instead of finding this a source of help would find it a serious embarrassment.

Amendment to the proposed Amendment agreed to.

Question put, "That the Amendment, as amended, be inserted in the Clause."

The Committee divided: Ayes, 16; Noes, 35.

Division No. 1.] AYES.
Banner, Mr. Harmood- Dickson, Mr. Scott Law, Mr. Bonar
Barrie, Mr. Hugh Harris, Mr. Peel, Mr.
Benn, Mr. Hamilton Hills, Mr. Peto, Mr.
Bigland, Mr. Hoare, Mr. Thomson, Mr. Mitchell-
Bird, Mr. Joynson-Hicks, Mr. Worthington-Evans, Mr.
Boscawen, Sir Arthur Griffith-
NOES.
Alden, Mr. Holt, Mr. Primrose, Mr.
Brady, Mr. Jones, Mr. William Robertson, Mr. John
Buxton, Mr. Sydney Joyce, Mr. Roch, Mr.
Cornwall, Sir Edwin Kelly, Mr. Scanlan, Mr.
Cowan, Mr. Leach, Mr. Smith, Mr. Albert
Devlin, Mr. Macdonald, Mr. Ramsay Solicitor-General, Mr.
Denman, Mr. Mond, Sir Alfred Ward, Mr. John
Hackett, Mr. Murray, Captain Watt, Mr.
Harmsworth, Mr. Cecil Norman, Sir Henry Williams, Mr. Penry
Harvey, Mr. Thomas Edward Nugent, Sir Walter Wilson, Mr. Tyson
Haviland-Burke, Mr. Nuttall, Mr. Wood, Mr. M'Kinnon
Hayden, Mr. Palmer, Mr.
Mr. BUXTON

On the question of meeting on Monday next, obviously next Monday would be inconvenient to Members, and therefore I do not propose to ask them to attend. It may be necessary to meet on the following Monday, but it will be avoided as far as possible. Next week we shall meet on Tuesday, Wednesday and Thursday.

Mr. SCOTT DICKSON

I hope that the hon. Gentleman will not ask us to meet on Wednesday.

Mr. BUXTON

I cannot give up all the days. We will talk about it.

The CHAIRMAN

The next Amendment is in the name of the hon. Member for Bow and Bromley (Mr. Lansbury), but the hon. Member cannot move it, as he is not a Member of the Committee.

Sir J. SIMON

On behalf of my right hon. Friend, the President of the Board of Trade, I beg to move in Sub-section (3), to leave out the words "relating to truck" ["relating to truck or any contract to the contrary."]

The object of leaving out these words relating to truck is this: If Members will look at the Bill they will see that it provides, subject to regulations, the employer shall be entitled "notwithstanding any provision of any Act relating to truck or any contract to the contrary, to recover from the workman by deductions from his wages or otherwise, the amount of the contributions so paid by him on behalf of the workmen." The only reason for proposing to leave out the words "relating to truck" is that on examination we find there is another Act of Parliament which may otherwise conflict with the present Bill, the Trades Boards Act, 1907, which happens to contain the provision in Section (6) that the minimum rate of wages fixed in that Act must be paid by the employer clear of all deductions. It is of course the intention of the Committee or anybody who has followed the scheme of the Bill to make no specific exception of that sort, and leaving out the words gives protection to the employé.

Amendment agreed to.

Sir A. GRIFFITH-BOSCAWEN

I beg to move in Sub-section (4), to add, at the end, the words, "and, notwithstanding anything contained in the Trades Disputes Act, it shall be unlawful for employed contributors, either in pursuance of a trade dispute or not, to attempt to recover from the employer the amount of their contributions."

Sub-section (4) gives protection to the employés. It prevents the employer in any case deducting from the wages of the employé his contribution or recovering in any way the contribution he has paid on behalf of the employé. What I wish to urge is that there shall be given a similar specific protection to the employer at the same time, and make it unlawful in any case for the employés to attempt to recover their contributions from the employer. It is quite true that the words we have just passed deal to some extent with the question; but may I call the attention of the Government to the very wide powers which are given in the Trades Disputes Act, passed in 1906. Unless the words which I propose to insert are put in, it will be perfectly open to men in any trade who have had this deduction made to strike, or at all events to attempt by means of a strike, or by threatening to strike, to force the employer to increase their wages to cover their contributions. They might lay their tools down to strike. It would be a perfectly legal strike unless the words I propose to be inserted are inserted, and, in that case, the Trade Unions would enjoy absolute immunity under the provisions of the Trades Disputes Act, 1906. What I suggest, therefore, is that, inasmuch as the Bill specifically protects the employé, it should also specifically protect the employers by the words I propose. Those words would make it perfectly clear that a strike engineered for this purpose—namely, to compel the masters to raise their wages to meet the contribution, would be an illegal strike, and therefore the immunity they enjoy under the Trades Disputes Act would not apply. I do not think the Amendment would make any real difference in the general effect of the Bill. It would not interfere with what I believe to be the intention of the Government, who certainly mean that nothing should be deducted in any case from the employer, and that no strike should prevent that intention. I think it does give the employer a certain protection which is denied him as the Bill stands at present.

Sir J. SIMON

The hon. Gentleman has supported his proposal by the suggestion that he is really endeavouring to introduce into the Bill a provision which is correlative to the provision already found in it in regard to workmen. He suggests that what he proposes would be some protection to the employer, whereas what is already in the Bill would be some protection to workmen. Certainly, so far as the Government are concerned, their desire is to hold an even hand between the two. But I would point out that the hon. Gentleman is really labouring under a mistake. What he proposes is not in the least correlative to the provision already contained in the Bill, and which he proposes as though it was analogous. The provision in the Bill is designed to prevent the employer, the man who pays the wages, from deducting from those wages that he pays, not only the workman's contribution, which he is entitled to take, but his own contribution. The reason that it is in the Bill is because nothing you could do would provide a corresponding provision in the case of the workmen, for the very simple reason that the workman does not pay money to the employer at all, and the two things cannot be made analogous. Provision is in the Bill, that the employer in paying wages to the workman, may deduct from those wages the workmen's 2½d., but he cannot take also the employer's contribution. Now it is proposed (I do not understand what is the meaning of the reference to the Trades Disputes Act) that "It shall be unlawful for employed contributors, either in pursuance of a trade dispute or not, to attempt to recover from the employer the amount of their contributions." The hon. Gentleman explains that what he means is that the workmen should not be entitled to strike for higher wages.

Sir A. GRIFFITH-BOSCAWEN

I do not say they should not have the right to strike for higher wages, but that they should not have the right to strike merely to recover this contribution of 2½d. which they are legally compelled to pay.

Sir JOHN SIMON

Will the Committee observe what justification there was for the suggestion that this proposal was analogous to the proposal existing in the Bill in order to protect workmen. What the Bill says on behalf of the workmen is that the employer shall not deduct from wages or any other bonus that he pays the 2½d. paid for the employer, and the thing which is put forward as analogous to that is that the workmen should not have the right to strike for an increase of wages if it can be proved to the satisfaction of the Court that their reason for desiring a greater wage is that they have a contribution to pay under this National Insurance Bill. But it must be obvious, I think, to anybody who considers the matter, whatever be the abstract merits of such a proposal, that it has no conceivable relation to practical working. You cannot legislate that a workman shall not strike any more than you can legislate that an employer shall not dismiss a workman, and the real corelative suggested by the hon. Member to put in the Bill, is that no employer shall ever be entitled to dismiss any workmen, on the ground that the National Insurance Bill prevents him from any longer making a profit.

Mr. BONAR LAW

On the question of the relative significance of the two things. I wish to ask the Solicitor-General does he or does he not think that under this Bill, the employer shall not be permitted to say to his workmen, "I am going to lower your wages precisely to the sum which is an additional burden I have got to pay."

Sir JOHN SIMON

That is a perfectly fair question, and, as usual, put very fairly by the right hon. Gentleman. I have no doubt about the answer. As regards this burden or any other burden which falls upon any party to the contract, it is always open to either party to the contract to give proper notice of the termination of the contract, and to say that he is only prepared to make a new one on different terms. No legislation that ever could be passed could alter that. No doubt, the workmen of this country have got their interests to consider just as the employers, and there is nothing on either one side or the other can ever prevent the employer from saying for whatever reason, or for no reason at all, "I give you notice I shall not require your services from the day this notice expires." No sensible representative of the interest of the workmen ever suggests that you could legislate to the contrary. In the same way, nobody can prevent the workmen saying, "I give you notice (for whatever reason) that I require a higher rate of wages," and if that is not prevented I fail to understand that you can introduce into the Bill a provision which is going to prevent it if it is shown that it has some relation to the National Insurance Bill.

The real truth is that this, like everything else, is adjusted by the strength of the forces on one side and the other, and by considerations which are economic and industrial, and nothing which an Act of Parliament can do will ultimately determine which of the parties gets the benefit of such an advantage. For that reason I most confidently suggest to the Committee that, however sincerely my hon. Friends opposite suggest, that this is an analogy to what is in the Bill, that there is no analogy at all. The provision in the Bill is that the employer as paymaster shall not deduct from that which he pays anything more than the workmen's contribution. That is a perfectly easy thing to understand and to put in an Act of Parliament. The thing which is now suggested, forsooth, is that workmen shall not combine to say "we want a greater wage" if it can be shown that one of the reasons why they want it is because this contribution is asked for from them. That is not practicable, and I do not think it would be right. Just, as I have no doubt, that the employers would be entitled to give notice to their workmen that they require to terminate their contracts and make new ones in view of this Act, so I say the workmen are entitled to give notice if they so desire that they also require the terms of their contracts to be revised. As to which of them succeeds it is a question as to which of them is the stronger and has the better argument. That is not a matter that can be determined by Act of Parliament.

Mr. JOYNSON-HICKS

The Solicitor-General is trying to argue as if Free Trade governed everything. What we are trying to do by this Bill is to arrange for something which the workman and the employers have not up to the present been able to arrange together. If this Act had not been passed, and if Free Trade had been left to work it out on voluntary principles, the Solicitor-General's argument would have been a perfectly true argument, that it must be left to the balance of the market to decide whether the employer is going to reduce wages by 2½d. or whether the workmen is going to get an increase of 2½d. I assumed, through the whole of the discussion, not only on this Part, but as well on the first Part, that it certainly was the aim of the Government to leave things as they are, as between employer and workmen, and to charge a fair charge to the employer with regard to his proportion, and a fair charge on the workmen as to his, and that each should pay their own proportion, and that there should not be any attempt on the part of the employer to get his contribution out of the workmen, or any attempt on the part of the workmen to got his contribution out of the employer. The Solicitor-General has put quite a different complexion on the matter; he has openly told us that as far as he can see, as soon as the Bill is passed, there will be these disputes leading to lock-outs and strikes, and in saying that I think I am carrying his argument to its logical conclusion. If, immediately the Bill is passed, an employer in one trade is going to set about to try and get the 2½d. out of the workmen, and if the workmen try and get the 2½d. out of the employer, the Act is bound to lead immediately to a succession of trade disputes ending in lock-outs and strikes.

Sir JOHN SIMON

As the hon. and learned Gentleman says he is representing what I said, may I say I did not suggest that, and I do not think anything of of the kind. What I did suggest is that when this Bill becomes law that the industrial and economic process, which settles rates of wages, will not suddenly come to a dead stop. That is what I said.

Mr. JOYNSON-HICKS

I really think the hon. and learned Gentleman has not improved his position by that explanation that that economic process will not come to a dead stop. I assumed, and I think the whole House did so, that the economic process should not take place in respect of contributions in respect of this Bill. That is the idea of the people throughout the land. No workman, I am perfectly certain, either in this part of the Bill or the other half, expects that his employer's contribution is to be at once made a process of economic disturbance between the employer and the workmen. If the Solicitor-General is correct, that will be the inevitable outcome of this Bill. The Bill provides perfectly clearly in Sub-section (4)— The employer shall not be entitled to deduct from the wages of, or otherwise recover from the workmen the contributions payable by the employer himself. I am bound to say if I were a workman reading that Clause, and if my employer came and said to me "I have got to pay an extra 2½d. after next week and I am going to reduce your wages," I should say, "Here is a provision that you are not to attempt to recover it from me, and it does not say you shall not attempt to recover it by process of law. The Act says "You shall not attempt to recover from workmen contributions payable by the employer," and if the employer attempted to reduce any employés' wages by 2½d. there will be liable to be an outcry among the insured throughout the whole country. The Solicitor-General said that my hon. Friend's proposition is not on all fours with the Sub-section regarding the employer. I agree, but there is nothing pari passu as between workmen and employer. The Solicitor-General agreed so far, and that there was no possibility of the workman taking proceedings to recover his 2½d. at law. The only thing he can do is to throw down his tools and say, "I am going to fight unless the employer pays my 2½d. as well as his own." If that is the position of the Government that they want to encourage or want not to provide against, I should be perfectly prepared to accept that the employer should not declare a lock-out to force his 2½d. from the workmen if on the other side it was provided that the workmen should not strike in order to force their 2½d. from the employers. I think I have endeavoured to put the point clearly, and to answer as fairly as I can the statement of the Solicitor-General. I do say we want a distinct assurance from the Government whether they are going to leave this matter to economic bargaining, leading inevitably and undoubtedly to strikes and lock-outs, or whether they are going to make the employer pay his contribution and to make the workman pay his.

Mr. WORTHINGTON - EVANS

The Solicitor-General's argument, as I understand it, is that this Amendment is not fair because it prevents and takes away the chance of the workmen striking to get back their 2½d., and that it does not similarly treat the employer. I think that could be met by a reciprocal Amendment affecting both employer and workman, and which I will mention in a moment. Before we do that, however, I think the Committee ought to make up its mind what it really does intend to arrive at by Subsections (3) and (4). Why is Sub-section (4) there at all? It is there to prevent the employer trying to deduct from the wages of the workman or to otherwise recover the 2½d. To otherwise recover the 2½d. might be by means of a lock-out, and that Sub-section might have the effect of preventing the employer if it could be shown it was for the purpose of recovering the 2½d., or it might limit the employer in a totally different way from the workman. I am quite prepared myself to limit the employer precisely as I would wish to limit the workman. I do not want to limit the workman and not to limit the employer. The Solicitor-General says after this Act is passed there is nothing to prevent the employer giving notice to his workmen to terminate the existing contract at the end of a week or a fortnight or a month, as the case may be, and then re-engaging them at lower wages, but if he did that, that would be "otherwise endeavouring to recover from the workmen." The learned Solicitor-General does not think it would be, but I can quite imagine considerable argument being applied to the fact that after the employer terminated his existing contract he re-engaged precisely the same men at precisely the same wages less 2½d., and that that was in itself evidence that he was endeavouring to circumvent Sub-section (4). Parliament is intending that the employer shall pay his 2½d. and that the workman shall pay his 2½d. I am not going to suggest that you can alter economic forces by anything you put in this Act, but I wished to put into the Act, if it were possible, words which would remind both workmen and employers of their moral duty. If the Committee follow me so far, I would ask my hon. Friend not to press his Amendment, but rather to accept the Clause which I have had drafted as follows:— (5) That notwithstanding the provisions of any Act it shall be unlawful, whether in pursuance of any trade dispute within the meaning of the Trades Disputes Act, 1906, or otherwise (a) for any employer or combination of employers to recover or to attempt to recover from any workman any part of the contribution paid or payable by the employer himself under this part of this Act, or (b) for any workman or combination of workmen to recover or to attempt to recover from any employer any part of the contribution which the employer under this part of the Act has paid or is directed to pay on behalf of any workman. That is absolutely fair to both classes. The Trades Disputes Act would apply equally to both parties, and there is in addition the Conspiracy (Protection of Property) Act of 1875 which I think also applies. Consequently I have put in the words "notwithstanding the provisions of any Act." I do not pretend that the addition of this Sub-clause will alter at all the economic force of the ordinary bargaining power between man and master, but it will register the desire of Parliament not to encourage strikes on the one hand or lock-outs on the other. I propose, in due course, to move that Amendment to follow Sub-section (4), if my hon. Friend will withdraw his present Amendment, which on the face of it appears to be, although perhaps not in fact, somewhat one-sided, and would handicap the workman by applying to him a different law from that which applies to the employer.

Sir J. SIMON

I cannot for the moment see how the words just read carry out the observations with which the hon. Member began his speech. He said that he quite recognised that you could not interfere with the play of economic forces, and he powerfully pointed out that the Amendment before the Committee might be an attempt so to do. If the hon. Gentleman's anxiety is lest under Sub-section (4) the words "otherwise recover from" refer to a prohibition on the employer's part to lock out, I can assure him with the greatest confidence that they have nothing in the world to do with it. The only reason why the Clause refers to otherwise recovering the money from the workman is that you might have the case—not a common case—of a bonus or something which is not, strictly speaking, wages, but money passing from the employer's pocket to the workman. The employer may deduct from that money, whether it is a bonus or any other form of payment, the workman's 2½d., but he may not deduct the 2½d. which the employer ought to pay. That has nothing to do with a strike or lock-out. We do not imagine that we are going to stop lock-outs any more than strikes by this proposal.

The CHAIRMAN

A discussion on the suggested Amendment would not be in order on the Amendment before the Committee.

Sir A. GRIFFITH-BOSCAWEN

I have no desire to suggest anything which would not be equally fair to both sides. I agree with the criticism of the Solicitor-General. Much that he has said shows that I went further than I intended. All I want is something which is fair to both sides. Therefore I will ask permission to withdraw my Amendment in order that the discussion may take place on the proposal of the hon. Member for Colchester.

Amendment, by leave, withdrawn.

Mr. WORTHINGTON-EVANS

I beg to move after Sub-section (4) to insert:— (5) Notwithstanding the provisions of any Act it shall be unlawful, whether in pursuance of any trade dispute within the meaning of the Trades Disputes Act, 1906, or otherwise:

  1. (a) For any employer or combination of employers to recover or attempt to recover from any workman any part of the contribution paid or payable by the employer himself under this part of the Act; or
  2. (b) For any workman or combination of workmen to recover or to attempt to recover from any employer any part of the contribution which the employer under this part of the Act has paid, or is directed to pay on behalf of any workman."
I will only add one word in reference to the observations of the Solicitor-General. He was trying to re-assure the Committee that the words "otherwise recover from" meant nothing more than deducting from a bonus that might be given in addition to wages. If that is really the meaning of the words, why not say deduction from wages or bonus? On the contrary, it opens up an entirely new vista, because the words are put into the Clause in contradistinction to deduction. It is some other process of recovering—a process which will suggest itself to the minds of hon. Members. The process that suggested itself to the mind of the Solicitor-General was that the employers might terminate their contracts and re-engage the same men at a lower rate of wages. That is, in my view, otherwise recovering from the workmen.

Mr. HARRY LAWSON

The Government have only themselves to thank for the proposal to amend this Sub-section. They will insist on putting into their measures bunkum clauses. When you propose to put in a bunkum clause, naturally to give it an appearance of fairness you must make it apply to both sides. What on earth do the Government think they gain by this Sub-section? Trade disputes will not take the simple form that has been anticipated in this discussion. Even the Solicitor-General seriously argues as if a strike or lockout would take place over the deduction of 2½d. Of course if there is an economic movement of this kind it will take an entirely different form. If the burden is too heavy there will be a substantial reduction in wages, and that may end in a strike. But to imagine that a good intention expressed by Parliament in a Clause of this kind will have the smallest effect is obviously futile. I do not think an expression of good intention has much effect on the public mind. I doubt whether employers, considering the way in which Parliament has treated them of recent years, will pay much attention to the expression of a pious hope on the part of the House of Commons. That being so, what is the use of inserting these words? If, however, they are to go in at all, they ought to be in the form proposed by my hon. Friend and to apply to both sides. But in neither case will they mean anything. In neither case will they stop a single trade dispute. It is only because the Government think they satisfy the opinion of a certain number of Members of the House and of certain people outside that they propose to insert these words. Would it not be far better to withdraw the Sub-section?

Mr. J. M. ROBERTSON

The hon. Member at any rate admits that the Amendment is a bunkum clause. We shall all agree on that.

Mr. HARRY LAWSON

The original suggestion.

Mr. J. M. ROBERTSON

The mover of the Amendment agrees that it is really a kind of moral exhortation. We are agreed on that. We are agreed that the Amendment is useless; the only point not agreed upon is whether the Sub-section in the Bill is equally useless. There is an obvious reason for putting in Sub-section (4). By putting in such a Clause you prevent the precipitation of a strike by a process that an employer might resort to—that of simply and straightforwardly deducting the 2½d. No one expects that when this prohibition is put in there will ensue an outbreak of strikes and lock-outs as hon. Members opposite predict. The probability is that both sides will regard the burden as equal, and that they will face the situation as equalised by the contributions equally imposed upon master and man. The clause which the hon. Member objects to as being bunkum is really practical up to a very important point. Beyond that point everybody agrees that if the master is determined and is able from economic conditions to reduce wages he is likely enough to do it, just as the workmen if they are economically competent to force wages up are likely to do it. That can happen irrespective of this proposal. But who expects that there is going to be an epidemic of strikes and lock-outs for 2½d.? This particular prohibition will prevent the resort to certain actions on the part of some employers which might precipitate a strike. In that particular way it is a useful proviso. But we are all agreed that the Amendment can satisfy no useful purpose at all. It is surely a peculiar line to take to suggest that because it is beliveed that a few lines inserted by the Government will have no particular effect you ought to insert a much longer passage which would have equally little effect.

Mr. RAMSAY MACDONALD

One of the previous speakers seemed to assume that those of us who represent Labour imagine that something is going to happen as the result of Clause 61, which, I can assure him, we do not. I do not think that Sub-section (4) will go very far. But it will do this; it will make it very difficult for an employer to deduct from the wages of his workpeople the additional 2½d. That is really the point. It comes in in this way. You get, for instance, a particular class of workman working at a declared scale of prices. They hand in their work at the end of the week, and the employer has to pay for it, say 20s. From that 20s. he says, "I can deduct 2½d." He cannot say, "I can deduct 5d." In order to enable him to legally deduct the 5d., a thing which he will very likely try to do, he has to determine the whole of his contracts. In this way you are putting obstacles in his way, and are preventing him doing what it is the intention of the Act of Parliament that he should not do. I am bound to confess that this is a small point, but it will just help those who are least capable of helping themselves. The well-organised unionist will fight his employer, if need be, on this matter, and will not accept deductions not contemplated by this Clause. But it is the weak person who will be most benefited by this. Therefore, I am going to vote for the retention of the Clause as it is, without the Amendment which has been moved.

Mr. BONAR LAW

The incidence of this payment will depend upon the course of trade and other considerations which the Act of Parliament cannot determine. There is something more than that to be considered, and I am bound to say that I am rather surprised by some of the observations in the speech of the hon. Gentleman the Member for the Tyneside (Mr. J. M. Robertson). He is a man of most logical mind and like men of that stamp, is fond of making a kind of syllogism. He says that what we propose is merely moral force, and, therefore, merely nonsense.

Mr. J. M. ROBERTSON

I did not use the expression "nonsense." [HON. MEMBERS: "Bunkum," "Bunkum."]

Mr. BONAR LAW

I do not agree. I think that moral force has a great deal of actual weight. All that my hon. Friend wants to do is to get that inserted in this Bill at the beginning, in order that the Act should be carried out in the way that Parliament intends it should be. The hon. Members for Brentford and Tyneside both say that the object of Sub-section (4) is that it should prevent the employer from deducting the 2½d. which he ought to pay. It is quite obvious that if the employer chooses he can get over that difficulty by deducting 3d. or lowering the men's wages 6d. The fact that this is here shows that the Government think that this will make it more difficult for a man to do that, because it is obviously unfair. Very well; what is there unfair in putting in at the beginning of the Act words against the same obvious unfairness on the part of the trade unionist trying to make the employers pay the workman's part of the contribution? We are simply asking for both to be treated alike.

It should be made perfectly plain, as far as Parliament is concerned, and has any power, that neither shall the employer be entitled to deduct his contribution from the workman, nor the workman entitled to make a strike for the sole purpose of getting his contribution out of the employer. That is the whole object. I cannot see why the Government should object to the Amendment in the form in which it has been proposed. It will at least work as well as Sub-section (4). I am bound to say that unless the right hon. Gentleman, the President of the Board of Trade wants to confirm the objections which have been sent to him from many employers, he is bound to do one of two two things. He is bound to either accept the Amendment or something like it, or he is bound to leave out Sub-section (4), and leave the matter to be settled in the ordinary course of law.

Sir ALFRED MOND

This is a very important discussion on the Sub-section, and it has not been made easier by the fact that the Amendment which the hon. Gentleman the Member for Colchester moved, and with which I have sincere sympathy, has not been put on the Order Paper, and that it is quite impossible for many of us really to follow the very difficult technical language. But the interpretation given by the Solicitor-General of Sub-section (4) came as a great shock to many of us, who, in reading the Bill in the ordinary way, without legal sophistries, certainly were under the impression that its object was to prevent the employer reducing the wages of his men by 2½d. per week in order to cover his contribution. I understand now that the real object of Sub-section (4), and the reason why it is to remain in the Bill is, that under this Bill, we do legally entitle employers to deduct the workman's contribution from the wages.

If, it is said, you are silent in the Bill as to the employer's contribution, the employer might argue that his contribution should come in the same way as the workman's contribution, and he may therefore deduct 5d. The workman would have no statutory or other authority to answer that argument as against his employer. It is not a question as to whether, when this Bill is passed, the employer will give an argument for reducing the wages of these men; that is not an essential point at the moment. The essential point is, that these words do not clearly say that the employer is not legally entitled or by statute to deduct his contribution. If you leave that point obscure—and remember that he has already got a legal right to deduct the one contribution—the analogy will be that he has quite a legal right to deduct the other. On the other hand, it will be very hard for the workman to argue that point, and it will probably be ultimately settled by the House of Lords. That surely is a reason for leaving it in. With regard to the Amendment of the hon. Gentleman the Member for Colchester, the difficulty I feel is this, that I do not see how, in the event of a dispute, you are going to differentiate this 2½d. from any other demand for an increase of wages. Suppose that the workpeople are not asking for 2½d. a week increase, but 6d.; are they to be debarred by Statute from striking for the balance on the ground that it is unlawful? Practically, I cannot see an answer to that very simple dilemma. I cannot see how to get over that practical difficulty. Somewhat reluctantly I have come to the conclusion that I cannot support the Amendment in its present form, although there is a good deal to be said for it.

Mr. HOLT

I do not see much point in discussing Sub-section (4) as it stands, because it has already been accepted by the Committee. With regard to this Amendment, speaking of an employer in one of the scheduled trades, I hope the hon. Gentleman who has moved will not press it. It seems to me to be absolutely unworkable. Why should not the employer or the workman try to shift the burden of

Division No. 2.] AYES.
Baird, Mr. Goldman, Mr. Law, Mr. Bonar
Baldwin, Mr. Harris, Mr. Lawson, Mr.
Benn, Mr. Hamilton Hills, Mr. Peel, Mr.
Bigland, Mr. Hoare, Mr. Peto, Mr.
Boscawen, Sir Arthur Griffith- Ingleby, Mr. Stewart, Mr. Gershom
Dickson, Mr. Scott Joynson-Hicks, Mr. Worthington-Evans, Mr.
Gilmour, Captain
NOES.
Alden, Mr. Denman, Mr. Harvey, Mr. Thomas Edmund
Brady, Mr. Goldstone, Mr. Haviland-Burke, Mr.
Buxton, Mr. Sydney Hackett, Mr. Hayden, Mr.
Cornwall, Sir Edwin Harmsworth, Mr. Cecil Holt, Mr.

the 2½d. if they think fit? It is their own private and domestic concern. The effect of this Amendment will be to compel persons to avoid saying that the Insurance Bill was their motive in asking for more wages, or employers in asking for a deduction. My experience of trade negotiations between employers and workmen is, that it is very much better and simpler to carry them on when the motives are admitted by everybody at the outset. Then you know what people want and why they want it.

Mr. BAIRD

There was one point in the speech of the hon. Gentleman for Swansea which struck me. He pointed out that any rise or diminution of wages would be covered by the Clause such as it is suggested we should insert. If you leave in this Sub-section, surely you make it impossible for any employer to reduce the wages at all on any pretext? [HON. MEMBERS: "No, No."] Why not? Any diminution would, of course, include a deduction of contribution which you have to pay towards the Insurance Fund. It does seem to me that leaving in the Sub-section would be to inflict a hardship upon the employer. That putting in the new Sub-section might entail a hardship on the workman, I agree, might have some force, but if the reasoning of the hon. Baronet is correct—and I am inclined to think it is—there is no doubt that this is standardising wages. Everybody knows it is practically impossible to do that, because the exigencies of business may make it impossible for the man to carry on his business unless there is a reduction of wages. If the Committee is not prepared to accept the Amendment, which is designed to make the thing even for both sides, then in fairness the least we can do is to take out Sub-section (4).

Question put, "That those words be there inserted."

The Committee divided. Ayes, 19; Noes, 30.

Jones, Mr. William Norman, Sir Henry Scanlan, Mr.
Joyce, Mr. Nugent, Sir Walter Smith, Mr. Albert
Kelly, Mr. Nuttall, Mr. Solicitor-General, Mr.
Macdonald, Mr. Ramsay Primrose, Mr. Ward, Mr. John
M'Callum, Mr. Robertson, Mr. John Williams, Mr. Penry
Mond, Sir Alfred Roch, Mr. Wilson, Mr. Tyson
The CHAIRMAN

The next Amendment in order is that handed in in writing by the hon. Member for Penryn (Mr. Goldman).

Mr. GOLDMAN

I beg to move in Sub-section (6) to leave out the words "Treasury may determine" and to insert instead thereof the words "Board of Trade may require."

The Clause, as it at present stands, leaves the Treasury to determine what the payment of the central body shall be. My Amendment proposes to substitute the Board of Trade instead of the Treasury. I think the course proposed in the Clause as it stands is not the most desirable course. It is conceivable, for instance, that you may have a depreciation in trade leading to a good deal of unemployment, and a heavy drain consequently upon the central fund. In that case I think the proper authority to determine the amount of money to come from the central fund should be the Board of Trade, and the object of my Amendment is to so provide.

Mr. BUXTON

This is a question as to how the contribution of the State shall be paid and in what manner, and at what time. I am very gratified by the confidence which the hon. Gentleman's Amendment shows in the Board of Trade. I can assure him we are quite capable of taking on the duty, but clearly the Committee will see that the best method of payment, and the best method in which the money should be paid, is one for the Treasury and not the Board of Trade to determine. As between the two Departments there can be no question that it is the duty of the Treasury, who have a special staff for that purpose, and not the Board of Trade.

Amendment, by leave withdrawn.

Question proposed, "That the Clause, as amended, stand part of the Bill."

Mr. SCOTT DICKSON

I should like to say that I think the retention of Sub-section (4) is a distinct mistake, because it introduces inequality between the employer and employed, which I think should not be allowed to remain there, especially since the Trade Disputes Act. Since that Act there is a great deal more reason for putting in a Clause against infringement of the Act by the workman. So far as I am concerned, I shall protest again at a later stage against this Sub-section passing as it is. May I point out with regard to what the Solicitor-General said as to the bonus, that it would be a great deal better in my judgment that if instead of the words "otherwise recover from" we said, "every sum payable to." As it stands, it seems to me it is a clear case of not keeping the ring as the phrase goes between the employer and the employed, and it is a distinct blot upon the Section. I do not propose to divide against the Clause, but I desire to say that, as the Clause stands at present, I think it is unfair, and I should like to ask the right hon. Gentlemen in charge of the Bill whether the point cannot be considered between now and the Report stage. We should keep a fair hand as between the two parties.

Sir JOHN SIMON

There is every intention of keeping a fair hand, and as far as I am concerned, I should be most anxious to consider the words suggested. Meanwhile, the phrase "or otherwise recover from" appears also in Sub-section (3).

Mr. SCOTT DICKSON

That is all the more reason for taking it out here.

Sir J. SIMON

I will consider the matter.

Mr. J. WARD

I hope when the Government consider this matter they will remember that the principle applied here is exactly the same as that applied in the Truck Act. We are told distinctly that employers shall not make reductions for certain purposes, but you do not prevent them sending an ultimatum to the whole of the workmen to reduce wages in order to make up for reductions. Here we are only carrying out the Statute Law and regulations as between the workman and the employer. I hope the Government will take that into account. If they follow the advice of the right hon. and learned Gentleman opposite, they will be altering the State regulations existing between workmen and employers.

Mr. JOYNSON-HICKS

I entirely agree with the arguments of the right hon. and learned Gentleman. I will not touch upon the Amendment which has been ruled out of order, but I want to say a word in reference to the finance of the Clause. Under the Resolution of this House, the employers and the employed are to pay equal shares. Parliament is not to bear an equal share with them, and is to pay only one-third instead of one-half. A good many people assumed the payments were to be one-third by the State, one-third by the employer, and one-third by the workman. That is not the case, and if the Amendment which was put down by the hon. Member for Leicester (Mr. Ramsay Macdonald) to increase the State contribution was in order, I should have supported it. Under Clause 76 there are provisions that at the end of every five years, the rates of payment on the part of the employers and the workmen may be reconsidered, but if there is any deficit in the working of the Bill the workmen and the employers are to have their rates altered. Many of us feel there will be a deficit, and that the Government contribution is not sufficiently high.

Of course, we have the Actuary's report from Mr. Acland, who is a man of the very highest position. If you study the report you will find it is entirely based upon the rates of unemployment in trade unions, because no other figures are available. There are no figures as to what unemployment there is outside the existing trade unions, and many of us are of opinion that the rate of unemployment is likely to be higher in the non-trade unions than in the trade union groups. The trade unions have the very pick of the workmen in their particular trades. I should be quite prepared to admit that there is less unemployment among the trade unionists and in their particular trades, and that being so, I think there is likely to be that fault in the Actuary's report, and that the figure he has allowed for unemployment is not sufficient, and ultimately I believe the Government will be forced to an additional contribution. It is quite possible for the House to revise and to reconsider the financial Resolution it has already passed, and I should like the Government before we get to Clause 76 to consider whether it would be possible to reconsider the financial Resolution to the extent, at all events, of the Government paying half the sum should that be necessary. If at the end of five years it should be found that there is a deficit to the extent of the sum that comes from the employer and the employed, and if the Government are not prepared to reconsider an increased contribution, I am bound to say I shall have to move an Amendment to Clause 76.

Question, "That the Clause stand part of the Bill," put, and agreed to.