§ Mr. GODFREY LOCKER-LAMPSONI beg to move, "That an humble Address be presented to His Majesty praying him to withhold his assent to the scheme contained in the Regulations (No. 2), 1914, dated 6th July, 1914, made by the National Health Insurance Joint Committee, under Section 8 of the National Insurance Act,. 1913 (3 and 4 Geo. 5, c. 37), with respect to arrears."
I must apologise to the House for bringing this Question on so late at night, but it is quite impossible to bring it on early. I have postponed it from day to day, and I do not like to postpone it any further. I can assure hon. Members I shall be as short as possible—seeing the subject is technical and difficult—without being so short as not to be clear. These Regulations have, I suppose, been issued by the Insurance Commissioners as a result of the Clause passed last year in Committee up- 1657 stairs on the Health Insurance Amending Bill, but when that Clause was passed, I am sure no one in the least realised that the position of insured persons was going to be worsened in several very important respects. In many ways these new Regulations penalise an insured person far more heavily than the procedure under the original Act. But I think I know what the Government will say in reply. They will point out that under the new Regulations, if a man falls ill he is only penalised in respect of the arrears of the preceding year, the arrears of all other past years being remitted, and that under the original Act the arrears of all past years were perpetually accumulating against him in the event of his falling ill. But the fact in practice will be that the new Regulations will cause more loss to the sick man than under the original Act whenever the arrears in the year preceding his illness are heavier than the average of the preceding years since his entry into insurance. Under the original Act a man's arrears over the three weeks credit a year mounted up against his until he fell ill, and he had then to take the consequences of his own arrears in the shape of lower benefits. But under the new Regulations at the end of every year all a man's arrears are wiped out free of cost to him, if he keeps well during the following year. But in spite of this the arrears have got to be paid for somehow in order to keep the society solvent, and under the new Regulations they are paid for by lowering benefits of those who fell ill, in many cases by more than is necessary to wipe out their own arrears.
12.0 M.
If I may, I should like to show how these new Regulations will work out. In the first place what in plain language the new Regulations say at the start is this: If a man owes only one week of net or penalty arrears, that is to say, if he only owes 4d. he is to suffer a loss of 7d. a week for six weeks, or 3s. 6d. in all, and sickness benefit, if he is ill and incapable of work for six weeks or more in the following twelve months. If he owes two weeks net or penalty arrears, that is if he owes 8d., he is to suffer a loss of Vs. in similar circumstances and every extra 4d. owed is to entail an extra loss of 3s. 6d. in similar circumstances, except that where the penalty arrears do not exceed sixteen weeks, the man's benefit cannot be reduced to below 2s. a week, nor a woman's to below 1s. 6d. If the penalty arrears are over twenty weeks, sick and disablement benefit is suspended for a year, and if the arrears are 1658 over twenty-six weeks these benefits are suspended altogether. Now it is manifestly unfair that an insured person owing 4d. should be docked of 3s. 6d., and it is not only unfair but is actuarily unnecessary. If a man owes 4d. in penalty arrears he could easily clear his debt by forgoing the right of medical benefit for the next four weeks. Medical benefit costs roughly 1d. a week. A man pays whether he wants a doctor or not and whether he calls in a doctor or not, so that if he gave up the chances of medical benefit for four weeks he could wipe the debt out. Why cannot the Insurance Commissioners give a man this option? It would make the new scheme far more flexible and acceptable. Many would prefer to give up the chance of medical benefit for four weeks, a benefit they may not require, than give up 3s. 6d. sick pay if they fall ill for six weeks. If the Commissioners thought that il would not be wise to give insured persons this option, why not combine the penalty, why not combine the deprivation of medical benefit with the deprivation of sick pay and so diminish the sick pay penalty that will fall on the insured person? I should be curious to know whether the Commissioners have considered this alternative at all. But these new Regulations are a good deal harsher than the provisions of the original Act in various respects. May I give a few instances of what I mean?
Take a man who enters into insurance in July this year. Suppose during the following year between July, 1915, and July, 1916, he runs into seven weeks arrears and does not clear them off within three months, that is by October, 1916, the time by which under the Regulations he is obliged to clear them off, if he does not want to be penalised, and I mention seven weeks, because if the arrears are under seven weeks there is no deduction from benefits, as under the Regulations a man is allowed three weeks' credit a year, and he has been in insurance two years since July, 1914. Suppose, as I say, this man runs into seven weeks' arrears and falls ill in November, 1916. Under the original Act his gross arrears being seven weeks the average arrears per annum since entry into insurance would be three and there would be no deduction from benefit as the penalty only begins when the average is four, but under the new Regulations his gross arrears being seven weeks, and being allowed three weeks' credit a year, his net penalty arrears would be one week, and for the first six weeks of illness 7d. a week would be deducted from his sick pay, or 1659 3s. 6d. altogether, although his arrears only amounted to 4d.
Take another case. If he is eight weeks in arrear in November, 1916, under the original Act his average arrears per annum since entry into insurance would still be less than four weeks as he has been insured just over two years from July, 1914, to November, 1916, and there would be no deduction from benefit; but under the new Regulations, if he is eight weeks in arrear, since he is allowed six weeks' credit in two years, his penalty arrears would be two weeks, and for the first six weeks of illness twice 7d., or 1s. 2d., would be deducted each week from his sick pay, or 7s. altogether. If he happened to be nine weeks in arrear, under the orginal Act his average arrears would be about four weeks, and 6d. would be deducted from his sick pay until he recovered, and the deduction might continue for twenty-six weeks. But under these new Regulations his net penalty arrears being three weeks, 1s. 9d. would be deducted each week if he were ill for six weeks, or 10s. 6d. altogether; and I may remind the House that the average length of illness for average age is far below anything like twenty-six weeks—in fact, it is less than two. So that under the original Act the deduction for twenty-six weeks, or anything like it, would hardly ever occur. But if a man were ill for six weeks in this last case, under the original Act at a penalty of 6d. a week, his penalty would be only 3s. against 10s. 6d. under the new Regulations.
If the man had twenty-two weeks' arrears, under the original Act his average arrears being about ten weeks a year, 3s. 6d. would be deducted from his sick pay and, what is very important, no deduction would be made when disablement benefit was being paid. But under these new Regulations, if he was twenty-two weeks in arrear, which with the allowance of three week's credit a year, means sixteen penalty weeks' arrears, 8s. would be deducted each week from his 10s. if he was ill for six week, as, if the penalty arrears are not over sixteen weeks, benefit is not to be reduced below 2s. And if a man were receiving disablement benefit 3s. would be deducted each week from the 5s. payable—an entirely novel innovation. If his arrears were twenty-three weeks under the original Act, 3s. 6d. would be deducted from his sick pay as before, and no deduction would be made at all if disablement benefit were 1660 being paid. But under the new Regulations, as his penalty arrears would be sixteen weeks, all his sickness and disablement benefit would be stopped for the first six weeks of his illness, as his net penalty would be 10s. a week. Therefore, it is quite clear that the new Regulations are far more drastic in such circumstances than the provisions of the original Act.
May I give one final illustration showing what would happen over a longer period of time, in order that the Government may not accuse me of selecting short periods to suit my arguments? Suppose this same man did not fall ill till 1923, and suppose his arrears in November, 1922, for the seven previous years had been seven weeks each year, or forty-nine weeks altogether. Under the new Regulations, whether he had been ill or not for the last seven years, he would commence the year from November, 1922, with only seven weeks' arrears against him, or with the three weeks' credit allowed, four net penalty weeks' arrears. If he fell ill in January, 1923, 2s. 4d., or four times 7d. would be deducted from his sick pay each week for the first six weeks of illness, or 14s. altogether. But under the original Act, if he fell ill in January, 1923, it would be necessary to calculate the average arrears since his entry into insurance, that is, he would have been insured for 8½ years since July, 1914, and, taking his arrears again at forty-nine weeks, he would show an average of five weeks' arrears a year. That is only 1s. a week would be deducted from his sick pay, or less than half the penalty during the first six weeks than under the new Regulations. And, as I said before, the average arrears for average age are well under six weeks a year. In view of this I think I am justified in saying that these new Regulations press more hardly in many cases on an insured person who falls into arrear than the provisions of the original Act, under same conditions; in fact, these new Regulations will always cause more loss to a sick man than under the original Act whenever the arrears in the year preceding his illness are heavier than the average of the preceding years since his entry into insurance. All these, to my mind, are sufficient to condemn the introduction of these new Arrears Regulations by the Insurance Commissioners.
But there is another consideration. These Regulations are introducing an entirely novel principle which, I am sure, was never anticipated when the Committee upstairs last year passed the new Clause. 1661 The new scheme is not merely administratively, as was anticipated at the time, but essentially different from that of the principal Act. The arrears' scheme of the principal Act was to take the individual and fine him for his own arrears; he was not penalised for anyone else's arrears; but in the new scheme the arrears are being pooled in such a way that the sick man owing 4d., or one week of net or penalty arrears, may be fined 3s. 6d. to help men who are in arrear who do not happen to be ill within the following twelve months. This is just as if a society had 1,000 members in arrear and they decided to run the risk of being ill in the next twelve months. That is, they decided not to pay up any of their arrears and the society made up its loss by giving lower benefits to those who happened to fall ill. Some members might not fall ill but others would fall ill, and those who did fall ill would have to make good the loss on the whole thousand members. Those who did not fall ill in the following year would escape the penalty, but those who were ill would have to pay for all the thousand. That is, the member who fell ill would have to pay not only his own arrears but the arrears of the man who was not ill. This is exactly what these new Regulations are doing, and that is the reason why the man who owes 4d. penalty arrears may have to suffer a loss of 7d. a week for six weeks, or 3s. 6d. in all, to pay for those who do not fall ill.
Up to now the principle of insurance has been that the man who keeps well pays for the man who falls ill, but under this new Regulation exactly the contrary is going to happen. The man who falls ill will pay the net penalty arrears of the man who keeps well. That is, the healthy man will be let off his net penalty arrears (the arrears for the three credit weeks allowed him) and will be let off at the expense of the sick member. I cannot believe that this is sound insurance, and what is more important and graver still is that it is directly contrary to the provisions of the Amending Act of last year. Clause 8 says:—
"Insured persons who are in arrears shall be liable to such reduction, postponement, or suspension of benefits as may be prescribed so, however, that any such reduction, postponement, or suspension of benefit shall be approximately equivalent to the value of the loss occasioned by the failure to pay the contributions in arrear."
1662 These Regulations are making a man not only pay his own arrears but the arrears of others as well. Quite apart from the fact that the sick member is being more heavily penalised by these new Regulations than under the original Act, I believe that a radically unsound principle is being introduced by these new Regulations which was not contemplated and was not authorised by the Clause passed in Committee upstairs last year. For this reason, although I am sorry I have had to detain the House, I feel there is full justification for bringing the matter before them.
§ Mr. CASSELI beg to second the Motion.
§ Mr. WEDGWOOD BENN (Lord of the Treasury)The system of arrears which is brought into force by these Regulations is as follows: At the end of every July we find out how many contributions in arrear an insured person is. We then give him three months to pay them at the rate of 4d., minus the reserve of three contributions a year which is credited to him. Then, if he does not pay at the beginning of November, he becomes subject to a penalty, which is an amount of 7d., which is deducted from the sick pay for each arrear of contribution for the first six weeks; for instance, if he is one contribution in arrear, he gets six times 9s. 5d. instead of 10s. What is the history of this particular Clause? It was inserted in Committee, of which the hon. Member was a member, and I rather fancy it was voted for by the hon. Gentleman himself.
§ Mr. FORSTERQuite wrong.
§ Mr. BENNPerhaps the hon. Gentleman will point out where I am wrong afterwards. This Clause was inserted in Committee by a majority of 28 to 1, and the hon. Gentleman (Mr. G. Locker-Lampson) was one of the twenty-eight Members who voted for it.
§ Mr. FORSTERIt was within the power of the Commissioners to make the Regulations. We do not deny that.
§ Mr. BENNI am speaking about the Clause. No one supposes the Regulations were inserted in Committee. After the Clause was inserted, a Memorandum was circulated to Members of this House setting out the details of the way in which the Commissioners intended to exercise the powers given to them under the Clause, and on the Report stage the Clause was agreed to without a Division. The Commissioners then laid the plan before the 1663 Advisory Committee, on which the insured persons, the societies, the employers and all the bodies concerned were represented, and it was unanimously approved by the Advisory Committee. One may therefore fairly say that it has been approved by all the parties concerned. What is the hon. Gentleman's complaint? It is that we are not following the practice of the old Section 10 of the principal Act. He says that is much fairer, and is in accordance with the average system. There is a good deal to be said in theory for Section 10 of the principal Act, but there is very little to be said for it in practice. The hon. Gentleman recommends it now to the favourable consideration of the House. This is what he said about it in the Committee. He said that during the past few weeks he had been pressed by big friendly societies and orders to put something on the Paper to meet this difficulty. The difficulty was just beginning. He held it would become absolutely intolerable for various officials of friendly societies unless they could pass some such Amendment as this into law.
That was the hon. Member's view about Section 10, which now he thinks is a fair and equitable way to put the case. These Regulations are made under the Clause which was passed in that way by Committee, which was approved by the House, And the Regulations under which had been approved by the Advisory Committee. Parliament laid down two principles to guide the Commissioners in making their Regulations, and of course they are bound to observe rules laid down by Parliament. These two prinicples are embodied in the Act. They are that the penalty should be approximately equivalent to the value of the arrears, and that it should be recovered by means of a reduction of benefits. The hon. Gentleman has said something about this being a system for making the sick pay for the well. I think that is a, fantastic reversion of the facts. The whole principle of insurance is that at any moment the persons who are well are contributing to the common fund for the benefit of the people who are sick, and that, which is the principle on which all insurance is founded, is as operative under this scheme as it has always been under the Insurance Act. The only difference is this. The common fund is rather smaller, because some persons have not paid into it. They have got into arrears, and therefore, when it comes to reciving their bonus, they get a smaller bonus, or they have paid a 1664 smaller premium on their insurance, and they get smaller benefits when it comes the time for drawing benefits, That is not making the sick people pay for the well. The fund consists of the contributions for the time being of people who do not need to draw benefits.
The hon. Member has criticised these Regulations, and has made some suggestions for some other ways in which you would recover arrears. I claim that the advantage of these Regulations is twofold. They are an advantage to the society and they are an advantage to the member. First of all as to the society. What the officials of approved societies want is simplicity. To manage their societies they want something which is easy to understand and can easily be carried out. They have found, as the hon. Gentleman himself said in Committee, the old average system impossible, and what they wanted was a system which gave them a clearly defined period on which to calculate their arrears. They wanted also a six-monthly card, which is one of the greatest steps forward in the direction of simplicity. You can only have a clearly defined period of calculation, and a six-monthly card if you have some such system as this, and it was welcomed by all the approved societies in the country. In fact, of 5,000 societies which have been visited by the officers of the Commissioners in reference to this scheme, only thirty-nine secretaries of societies have found any difficulty in its administration. The hon. Gentleman proposes that instead of a man paying arrears by deductions from cash benefits he should pay them by forgoing medical benefit for a certain number of weeks. I really wonder how he could possibly put such a scheme forward. Supposing a man has been put on a doctor's panel for a year and says, in the middle of it, "I will go out for five weeks. I am feeling very well," what are you going to do with the doctor? Are you going to recover 4d. or 5d. from him in respect of the weeks in which he thinks he will not need the doctor's services? It is only necessary to state the suggestion to see that it really is perfectly impracticable.
As to the member. The principles on which any Arrears Regulations should be based are three. They should make it as hard as possible for a man to get into arrears and as easy as possible for him to pay up the arrears, and above all, they should make it impossible for a man, as he gets older, to be crushed under a load of 1665 arrears and debt to his society. Hard to get into arrears. How is this calculated? First of all, during the very period when a man finds it most difficult to pay his contributions, the period of sickness, he has no contributions to pay under the Act. That is a boon which was never conferred and could never be, under the old voluntary system. Secondly, he has every year credited to him three weeks' reserve contributions, so that all persons who have been insured from the beginning will start with a reserve balance of six contributions before any arrears are deducted for the period which has elapsed up to the present moment. With those two things to help him we may fairly say that it is hard for him to get into arrears. As to the difficulty of paying after the calculation is made, he is given three months in which to find the money at the fourpenny rate, and in addition to that he has the benefit of all the reserve contributions which may have accumulated. There is no obligation on a man to pay up. He need not pay up unless he likes. If he does not pay up, he is absolutely quit of all obligation to the society after a year.
What happened under the old system? He had to pay his contributions all the time he was ill, and sometimes fines in addition. Under the old voluntary system if he exceeded the limit of credit which the society allowed, he would fall out of insurance in that society, and all his savings would be wasted. Thousands of old men who were brought back into insurance had been in insurance societies and had fallen out because of the accumulation of arrears. What is the present system? The present system imposes a penalty, and you must have a penalty under a contributory system. If you do not have a penalty, there is no incentive for a man to have his card stamped by the employer, and even if he falls into arrears, whatever his age, and however intermittent his contributions may be, in twelve months he is absolutely clear in the society's books. Even in the case of the older men, who most need help of this kind, six weeks is the limitation of the penalty. After six weeks, save in some exceptional cases, they are absolutely clear of the society's books, and all the time medical benefit and sanatorium benefit have been running. The hon. Gentleman says that there will still be hard cases, that there will be a large number of people in arrears, and that they will find themselves entirely deprived of 1666 benefit every year. There may be such cases, and to meet them the Chancellor of the Exchequer in his Budget statement announced that the Government propose to set up a Benevolent Fund which will be at the disposal of societies and branches who have members coming within the definition of the hard cases to which the hon. Member has referred. They will be in the best position to judge of the merits of each case. If the merits justify it, they will pay the arrears from the Benevolent Fund, so that a man will not fall out of benefit at all. I hope I have made the matter clear and justified the equity of the proposed rules.
§ Mr. WORTHINGTON EVANSI would like to say one or two words with regard to this question, and I would like first to deal with the last statement with which the hon. Gentleman finished his speech. I understood him to say that the Chancellor of the Exchequer said he was going to form a Benevolent Fund.
§ Mr. WORTHINGTON EVANSI think if the hon. Member looks at the Budget speech he will find he is wrong. All that the Chancellor of the Exchequer said in the Budget speech was that there would be found some money for arrears. It makes a great deal of difference. The hon. Gentleman has said it is now going to be used in the Benevolent Fund, and all the arrears are going to be paid up.
§ Mr. BENNIt is very important it should be clear that that is not so. The Benevolent Fund is to pay the arrears of members of societies who fall into arrears through no fault of their own, but the arrears will continue.
§ Mr. WORTHINGTON EVANSI am anxious not to misrepresent the hon. Gentleman, but I desire to know what is going to be done with the Benevolent Fund. It is one of the things we are anxious to find out. In cases where a man falls into arrear through no fault of his own then the Benevolent Fund is to be used to pay up all the arrears. If that is the real case, these Arrears Regulations are not necessary at all because they are to look after members who through unemployment are unable to continue their contributions. Unemployment is not the fault of the man. If the man is a worker, so long as he is employed, there will not be any arrears, and the arrears arise through 1667 unemployment, and if the Benevolent Fund is going to pay up arrears through no fault of his own, this question is reduced to a very small matter indeed. But these Arrears Regulations which we are asked to consider and approve, are not complete, and really the House is not in a position to give a final decision with regard to them. The Annual Report of the National Insurance Commission, after explaining what the Arrears Regulations are, what they are intended to do, says:—
This explanation of the steps taken by the Commissioners to give effect to the direction of Parliament in the Act of 1913 would be incomplete without some brief reference to the special branch in aid of arrears which has been proposed to Parliament in connection with the financial arrangements.And then it proceeds to say a few words about the Benevolent Fund, although it does not call it the Benevolent Fund. But at present the House is quite without any information from the Chancellor of the Exchequer of what this Fund is to be used for, and up to this moment this House has never voted any sums whatever towards the Benevolent Fund. For all that this House knows, no money will ever be voted for the Benevolent Fund. It is neither in an Act of Parliament nor in a Bill even, nor is it in an Estimate or Supplementary Estimate, and has never been put to the vote of the House of Commons, so that, if we could be quite sure that what he hon. Gentleman says about the Benevolent Fund is correct, we might pass away from these Arrears Regulations as being quite unimportant. Until the House has actually voted the money and passed the Votes for which it is to be used, we have to consider the Regulations as they are and their effect upon those who will come under them.The hon. Member laid down three propositions, although I do not dispute at all as to the features that ought to be found in Arrears Regulations. He said it ought to be hard for a member to get into arrears, and then he claimed apparently for these Regulations that the insured person would not have to pay these arrears when sick. That has nothing to do with these Regulations. That was in the original Act. He also seemed to suggest that the reserve contributions were some effect of these Regulations; they are nothing of the sort. They were provided in the original Act, and what we want to see is that both these features should be taken into account and brought to the benefit of the injured person in the best possible way. He said that under these 1668 Arrears Regulations it ought to be impossible to crush a member under a load of debt. That is a very important element in Arrears Regulations, and the hon. Gentleman, as I understood, seemed to think that in most cases, if not all, a member would be free of the Arrears Regulations in six weeks. Of course he knows well that, if the arrears on the average exceed twenty weeks, then the arrears are not wiped out in six weeks.
The insured person is suspended altogether from the benefit, and if that goes on for two years, he is not only suspended from benefits but he loses his reserve value, and for ever after—and this seems to me to be quite the most serious part of the Arrears Regulations—he is in reduced benefit; whenever he is employed he has to pay the full contribution, but never again can he hope to get the so called minimum benefit of 10s. It is much more probable he will never afterwards get more than 5s., and yet he has to go on paying the full contributions. The hon. Gentleman, in explaining the effect of these Arrears Regulations, did not say anything about that, and that surely is crushing a member under a load of debt practically for all time. No one can venture to anticipate how many such persons there will be. That would, of course, largely depend on the application of the Benevolent Fund, and if it is elastic; but, if we take the Regulations as they are now, it is safe to say many thousands, possibly hundreds of thousands, in the course of time, will come under this suspension, and cease to receive any benefit at all, or rather will only be entitled to very much reduced benefits for all time.
Then the hon. Gentleman combated my hon. Friend's statement that the sick are made to pay for the well. He described that as a perversion of the Regulation. But, surely, there can be no doubt about it. The hon. Gentleman tried to explain it in this way: He said—"Ah, but the person in arrear pays a smaller premium, and, therefore, he must receive a smaller benefit." So far so good, but the benefit is reduced much more than is necessary. Because of the smaller premium paid by that Member, it is reduced so as also to take into account the smaller premiums of others in arrear who do not happen to be sick in a particular year.
§ Mr. WORTHINGTON EVANSThat is quite possible. But the hon. Member does not suggest that every man's sickness is necessarily the same as every other man's sickness, and, consequently, it is perfectly obvious that my hon. Friend's statement, that those who are sick are going to pay while sick for the arrears of those who are well, is perfectly accurate. I do not want to detain the House any longer than I can help, but in the Memorandum which was issued, I think, by the Joint Committee, explaining the system of arrears and dealing with the actuarial part, it is quite clear that this is a pure gamble, and that no one can say whether these Arrears Regulations are fair as between one insured person and another. This is their statement:—
There is, unfortunately, an almost complete absence of information as to the incidence of unemployment at different ages,"—and, so long as there is that want of information, it is quite impossible to draw up a system which will be fair to all. Again they say:—There are no means of estimating in which direction the financial balance will incline after the imposition of a uniform rate of penalty, but the number of persons falling into this group must be extremely small, and the balance, if any, between losses and gains under the operation of the scheme must be quite insignificantIt is quite evident that they are unable to say whether the amount of deduction actually made from the benefits paid to the sick person will really compensate, or will be more than necessary to provide for the arrears. But the complaint that I make is rather as to the method in which the Government have dealt with this, than the actual substance of the Arrears Regulations themselves.I think the strictures that were passed by my hon. Friend are perfectly correct. These Regulations were published, I believe, in the first week in July. At any rate they could not come before the House earlier than the first week in July, because, when my hon. Friend tried a few nights ago to move the same Motion as he has done to-night, the hon. Gentleman (Mr. Wedgwood Benn) made the statement that they had not then been laid on the Table of the House.
§ Mr. WORTHINGTON EVANSThe result was that we could not call the attention of the House and the country to the Regulations until they were laid on the Table. The matter, therefore, could 1670 not very well have been brought on before this. Now, what is the present position? These Regulations come into operation almost at once, and before the twenty-one days have expired. They may, in fact, be said to be in operation now, because the new insurance books, one of which I hold in my hands at this moment, are already published, and the effect of the scheme is set out in that book. Just consider what would happen if we took a certain course. The whole of the insurance business would undoubtedly be hung up, and endless confusion would be caused in all the societies if the House of Commons did cancel the Regulations. All these books would have to be reprinted; there would be no scheme of arrears; societies would be continuing to pay full benefits for part contributions, and would be adding greatly to the risk of insolvency.
The House was supposed to have the control over these Regulations, but all this has been done purposely to prevent the House exercising that control. Matters would have been made perfectly easy if the Government had chosen to put the Regulations before the House three, four, or five months ago, when effective criticism of them might have saved insured people a great deal of trouble and loss. But they have put off the matter till the last moment, so that if the Motion were persevered in it would have the effect of disorganising not only the societies, but the whole machinery of insurance. In these circumstances I think the House does well to protest against the action of the Government, and my hon. Friend was quite right in calling attention to it to-night. The hon. Gentleman (Mr. Wedgwood Benn) said these Regulations were very simple, and that this was one of their great advantages. I wonder whether he has seen an insurance book which tries to explain these Regulations that he tells the House are so simple. There is not an insurance man who realises what has to be done by the secretaries of various societies who does not tremble to think what will be the result of these Regulations. The opportunity for mistakes, for irritation, and for discontent is so great that before long the Government will find that the actual results of the Regulations are a far more effective criticism than any other that can be offered.
§ Mr. BOOTHI think it necessary, late as the hour is, to say a few words in answer to the hon. Gentleman who has just 1671 spoken. In my opinion the hon. Gentleman is perfectly correct when he says that the arrears question will cause a great deal of trouble to the societies and to the friends of the Insurance Act in the near future. There is no doubt that it will cause a considerable amount of trouble, and the critics on the opposite side must take their choice. Either they will be good friendly society men and will be guided by the principles which have been recognised throughout the whole history of the movement, or they will be merely party politicians. That is for Members of the Opposition to decide themselves. The attitude taken up to-night is one of complaint against the present Regulations. Well, I daresay there are many Members in this House who could find fault with them, and I daresay some of them would be inclined to try if it were not so late. But what is the argument of hon. Members opposite? It is something far worse. They complain that we are not standing by the original Act. Do they say that the Government have introduced something more complicated and unjust than the original idea? Is that their grievance? If it is, then I think it only needs to be stated to show the folly of it. The advisers of the Government in these matters are not in any sense party men. These Regulations are not framed by any party caucus. They come from permament officials who serve a Department and are quite as well able as any hon. Member in the House to deal with these problems. The case which could be made surely is, not that the Regulations need great care in carrying them out, but that they needlessly complicate the issue. But I can assure the House that the great approved societies regard these new Regulations as far superior to the old ones. You cannot get any friendly society official of standing in this country to say that he would perfer the old system rather than these new Regulations.
§ Mr. WORTHINGTON EVANSThey do not like these Regulations.
§ Mr. BOOTHIt must be obvious to anybody that when you alter a system of reduction of benefits, or fines, or modes of payment, or whatever it may be, that you can point to people who will have grievances. You can show that under system A a certain individual is better off than under system B, but the same thing happens if you put it the reverse way. It is quite easy to produce these cases, and 1672 I submit that what hon. Members ought to ask themselves is this: In the main, taking the whole working of the scheme, is the scheme more unfair to the insured persons than the previous one? I say it is more just to them financially, taking its operation on all individuals who will come within its scope, and also it is less complicated to work. I agree that it is bad enough and difficult enough; but any scheme would be difficult. The duty of the hon. Member for Colchester (Mr. Worthington Evans), as an expert, should have been to have got up and have dealt with the matter sympathetically. He should have shown how, by amending the book here and there, he could have saved secretaries of societies a good deal of work. But he has not made any attempt to do so. I could take hold of any friendly society's book, study it, find all kinds of fault, and say, "You want something simpler." That is easy enough; but it would be very difficult for me to produce simpler working. What is the statement made by the head of the greatest approved society in this country at the present moment? I will quote the words of Mr. Thompson—I do not know what his politics are, but he is certainly not a member of the Liberal party—the manager of the Prudential Insurance Society and President of the National Conference of Industrial Approved Societies. This is what he said:—
He must describe the original Act as an impossible scheme, and it was practically agreed among the various approved societies that the only thing to be done was to repeal the provisions of the Act of 1911 relating to arrears, and confer on the Insurance Commissioners the power, with certain limitations, to deal with the matter by regulation.There is an official statement that it has been found by the approved societies that a complete change is necessary. Therefore the whole of the approved societies—for he spoke in the name of all of them—asked for a new scheme of some kind. The Government have produced it, and have laid in on the Table of the House.
§ Mr. G. LOCKER-LAMPSONWould the hon. Member read a little further?
§ Mr. BOOTHCertainly, and I will present the hon. Member with a verbatim copy of the speech if he would like to have it. All the approved societies ask that the Insurance Commissioners should have power to frame a new scheme. The Commissioners have brought forward that scheme and it is before the House. It is not an answer to say that the scheme is a little difficult 1673 and complicated, because it is less complicated and difficult than the original Act, and more beneficial to the insured persons. It may be that after a few years longer we may get a better system still, but as the scheme is a substantial improvement on the scheme of 1911, I think the House should vote for it.
I would just point out to my Friends the trade unionists here, with a vast improvement it will be with regard to the man on a prolonged strike. Under the original scheme, if there were a prolonged strike, extending nearly a year—and sometimes there are these unfortunate troubles—then that man would not have been in benefit for the whole of his life; whereas, in this case, however long the period, he gets quit of his past—surely in the case of a prolonged strike it is black enough—he gets rid of it in the next year, and goes forward to his future life entirely untrammelled By the big burden that this must otherwise mean. I am sure the suggestion which the hon. Member opposite made, that there should be an option for medical benefit, has not come from any approved society. Although they are interested in distributing sick pay, I do not think any of them would like that that option should be given, or that a man, on getting into arrears, should cut off his doctor.
I appeal to the hon. Member to revise his view of things. We all want to stick to the medical benefit, the maternity benefit, and the sanatorium benefit. If there is to be a reduction, let it be on the amount of class sickness pay, rather than on these great questions, one of which affects mothers; another, people in consumption; and the other, the continuous medical attendance to the breadwinner. If the only suggestion of a practical character that can come from the other side is that there ought to be given an option which—as my hon. Friend (Mr. Wedgwood Benn) pointed out, in his admirable speech—is utterly unworkable, then I am afraid that this evening has not been very well spent. I therefore appeal to my friends, as one who foresees a considerable amount of trouble in the future in working this Act in regard to these Arrears Regulations, to vote for them, because they are an improvement on the original Act. They have been asked for by the friendly societies; and if, by any mischance, they were defeated now, it woud throw the whole work into hopeless confusion, and would be of no benefit either to the officials or to the insured persons.
§ Mr. FORSTERIf the House thinks that the hon. Gentleman who has just sat down has given a fair version of what fell from the manager of the Prudential Company, in that speech which he has quoted, it will be under a very considerable misapprehension.
§ Mr. FORSTERYes, and I am going to read some more. If the hon. Gentleman, who quoted the manager of the Prudential Company, had continued the quotation the House would have seen that so far from the representative of the Prudential Company being satisfied with these Regulations, as the hon. Member for Pontefract represent him to be—
§ Mr. BOOTHI never said that. I must object to this misrepresentation. When I quoted the manager of the Prudential Company, I quoted his exact words, from the verbatim extract that he himself presented to me. I have never gone beyond that. I have made it clear that I would have preferred simpler Regulations, but that I was not in a position to suggest them. The manager of the Prudential Company would have preferred simpler Regulations, but he is quite firm in the opinion that they are better than the original ones.
§ Mr. FORSTERYes, the hon. Member is going a bit further than he went in his speech.
§ Mr. FORSTERI propose to continue the quotation which the hon. Member began. This is what Mr. Thompson, the general manager of the Prudential Assurance Company, said:—
These Regulations have been issued for some little time, but, although the scheme set out in these Regulations must be described as an improvement on the scheme contained in the original Act—That is about as far as the hon. Member opposite went—it is, notwithstanding, of such a complicated nature, and involves so much work, and such infinite possibilities of error, that I am voicing the views, I believe, not only of the officials of the industrial insurance approved societies, but of all those who are responsible for the administration of most of the other forms of approved societies, when I say that I view with very grave apprehension the coming into operation of these Regulations.I will not trouble the House with the full extract, but a little later on in the speech which the hon. Gentleman obviously has in his hands, and which therefore he did not quote as fully as he might have done—
§ Mr. FORSTERHe goes on to say:—
I believe I shall not be wrong in expressing the view that, even now, the Insurance Commissioners would be well advised to withdraw their scheme, and to substitute for it something much simpler, even though somewhat rougher justice had been done.I think the hon. Gentleman opposite rather played with the credulity of the House of Commons, when he professed to represent a quotation, which he made from the speech of this official of one of the greatest approved societies, as being more or less favourable to the Regulations which we are now discussing. I will not take up time by going over the ground which has been covered by my hon. Friends. I think my hon. Friend the Member for Salisbury (Mr. Godfrey Locker-Lampson) was well justified in drawing the attention of the House to the shortcomings of these Regulations, and in pointing out directions in which individual insured persons will undoubtedly suffer hardship in future.But I cannot leave out of account—and here I am bound to adhere to the attitude which I have adopted with reference to this insurance problem from the first—that the main object which the House of Commons—so well as it can, on the information given to it, and the opportunities afforded to it—the main object of the House of Commons must be to safeguard the financial stability of the fund, and to secure to the general body of people, brought into insurance, whether they wished it or not, the opportunity of getting the benefits which have been promised to them. That is the prime business of the House of Commons. The hon. Member for Colchester (Mr. Worthington Evans), no less than the hon. Member for Salisbury, has pointed out that these Regulations, framed by the Insurance Commissioners under the Act of 1913, have been considered, re-considered, altered, and amended by the Advisory Committee.
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I think the draft was first submitted to the Advisory Committee in October of last year, and that draft did not meet with approval. It was withdrawn, and something of the draft which we are now considering was submitted to the Advisory Committee, in January of this year. This received the 1676 unanimous support of the Advisory Committee. It is in the Annual Report of the Commissioners, from which my hon. Friend quoted. We find that this has been the subject of actuarial investigation and examination by the Actuarial Department of the Insurance Commissioners. Under these circumstances, I think we should not be well advised if we were to press this matter to a Division to-night—[HON. MEMBERS: "Oh!"]—however disappointing such a course may be to hon. Gentlemen who have sat up merely to go into the Division Lobby. Having regard to the fact that these Regulations have been approved by the Advisory Committee and supported by the Actuarial Department of the Insurance Commissioners, I, for one, do not feel prepared to take upon myself the responsibility of dividing against them, although I feel that my hon. Friend was perfectly justified in calling attention to them. The Government and their advisers must take the responsibilty of carrying these Regulations into effect, and upon them will rest the responsibilty for any shortcomings that they may contain.
§ Mr. GODFREY LOCKER-LAMPSONAfter what my hon. Friend has said, I do not propose to divide on this Motion. I do not want the hon. Member opposite—
§ Mr. SPEAKERThe hon. Member is not entitled to make another speech. If he wishes to withdraw, I will put the Question that the Motion be now withdrawn. If not, I will—
§ Mr. GODFREY LOCKER-LAMPSONYes, Sir, I will withdraw it.
§ Mr. SPEAKERThe Question is that the Motion be withdrawn—[HON. MEMBERS: "No, no."].
§ Motion, by leave, withdrawn.
§ It being after half-past Eleven of the clock on Monday evening, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
§ Adjourned at One minute after One a.m., on Tuesday, 14th July.