UNEMPLOYMENT BENEFIT [MONEY]. (Hansard, 26 November 1919)

The MINISTER of LABOUR (Sir R. Home)
I beg to move, That it is expedient to authorise the payment, out of moneys to be provided by Parliament, of any additional sums which may become payable under Section 106 of the National Insurance Act, 1911, in pursuance of any Act of the present Session to increase the rate of unemployment benefit payable under the National Insurance (Unemployment) Acts, 1911 to 1918, and to make certain consequential Amendments in those Acts. 1854 It will not be necessary to say more than a few words in explanation of what is involved in this Financial Resolution. It is proposed to read the Bill a second time to-morrow, if the House assents. The intention of the Bill is to increase the benefit under the Unemployment Insurance Act, at present in existance, from 7s. to 11s. per week. That in itself involves no extra grant of money by the House of Commons. Where the extra expenditure is involved is in the following, respect: Under Section 106 of the Insurance Act of 1911 and of the Amending Act of 1914 it is provided that the State shall give a subvention of one-sixth to any trade union that provides in itself a certain amount, or any amount, of unemployment benefit, but the amount is limited to one-sixth where the trade union pays no more than 17s. If it pays anything in excess of 17s. then the one-sixth does not apply in respect of any such sum in excess. What has happened in general has been this, if I may take a rough illustration. The trade unions in many cases have paid unemployment benefits to-the extent of 10s., while the State has paid 7s., with the result that the State has given a subvention of one-sixth of 10s. to the trade union. What will happen-now, with the amount of benefit going up, is that the 11s. will be paid by the State instead of 7s., and accordingly it is necessary to increase the amount of the limit-within which the State pays its subvention of one-sixth. Therefore, the Financial Resolution is required for the purpose of providing these extra moneys. In total, we do not estimate that this subvention will, under present circumstances at least, amount in any year to more than £6,000. By no possibility, and even then only under the most extreme circumstances, will it ever reach any sum above £20,000. The estimate now will not exceed a sum of something like £6,000. It will apply, according to present conditions, to something like 200,000 insured workpeople.

§ Sir F. BANBURY
I am much obliged to the right hon. Gentleman for his explanation. As I gather, the first part will not entail any additional expenditure-upon the country. The report of the Government actuary is, as far as I can understand it, to that effect. Now we come to another thing altogether, and that is the provision under Section 106 of the principal Act, which provides in certain circumstances for a subsidy being paid by 1855 the Government to trade unions. Why on earth should the Government pay a subsidy to trade unions? Why should they pay a subsidy to trade unions any more than to federations of employers? Trade unions are very great associations which wield great influence already, and apparently are going to wield as great, if not greater, power in the future. They are associations with large sums of money, in some cases with very large sums of money. To use a colloquial phrase, why cannot we leave them on their own bottoms. I have always very much objected to these subsidies. In the first place, I do not think they are necessary, and, in the second place, I think they are; a bad thing altogether.

§ Sir R. HORNE
But it is the law now.

§ Sir F. BANBURY
It is a very bad law. It is a bad law introduced into the Act of 1914. I am not quite certain that I am right, but as far as my recollection goes, the Act of 1914 was introduced at the beginning of the War.

§ Sir R. HORNE
It began with the Act of 1911.

§ Sir F. BANBURY
A very bad Government was in power in 1911, and it is only to be supposed that they would do things which more sensible persons would not agree to. My recollection is that the lion, and learned Member for Cambridge University objected in 1911 and in 1914 to these provisions. I suppose it is a little late to attempt to overthrow them now, though I should very much like to do so. I do not propose to do that because I do not think I should get any very great amount of support. But sometimes I think it is well to divide in order to show the principles which actuate you, and to have it recorded that you have some principles which you are prepared to back. The right hon. Gentleman has told us that this subsidy will not cost more than £6,000 and in any event not more than £20,000.

§ Sir R. HORNE
£25,000 in extreme cases.

§ Sir F. BANBURY
It has gone up in the last few minutes. I think I prefer, if the right hon. Gentleman will allow me, to take the Estimate which he gave in his opening speech, and not the Estimate which he has given now, when he is rather inclined to think that I am going to move 1856 an Amendment. I do not propose to put in as much as £20,000, because that is very exceptional. I propose to give the right hon. Gentleman something like 140 per cent, increase on his original estimate of £6,000. I propose to add at the end the words but in no case shall such sum exceed fifteen thousand pounds in any year. I trust the Government will accept that. It is extremely reasonable.
Amendment proposed: At the end, add the words "but in no case shall such sum exceed fifteen thousand pounds in any one year."

§ Sir R. HORNE
While I do not believe that my right hon. Friend's suggested words will affect in practice the operation of what I have proposed, I regret very much that I cannot accept his Amendment in principle, and for this reason: If you are going to give this subsidy to trade unions who are insured and are paying insurance benefit, it is absolutely impossible to work upon any limited sum. It must either apply to everyone who comes within the scope of the Act or to none. You cannot say if you have an enormous increase in insurance in this country—it would be a very good thing for the country if it happened—that once you have got to a certain number of unions, which would eat up the whole of the £15,000, thereafter you will give nothing to anyone else. It would be impossible in any year to say where you were, or how many unions you could recognise. While I appreciate entirely the desire for economy, and will endeavour to aid it in every way, in principle this Amendment is impossible

§ Mr. MARRIOTT
On this point I desire to support the Minister of Labour, for the reason that here we have one of the eases in which what I may call the benefit side of the trade union movement is differentiated from the militant side of that movement. I should regret exceedingly if anything were done by this House which would in any degree discourage the benefit side of the trade union movement, and, very regretfully, on this occasion I must dissociate myself from the right hon. Baronet. We are very grateful, at least I am, for the information contained in the White Papers, but would it not be possible to let us have them in time to read them before the matter comes up? It may 1857 have been my own fault, and I do not know what time this White Paper was at the Vote Office.

§ Sir R. HORNE
At seven o'clock last evening.

§ Mr. MARRIOTT
I apologise. I have been continuously employed, and even had I obtained it then I should not have had time to read it. Apart from this instance, I would ask that we should have the information on which the, Government base their Financial Resolutions in reasonable time.

§ Sir F. BANBURY
I am not quite sure that I am convinced by the arguments of the right hon. Gentleman, because if there were a large increase in membership that would not mean unemployment.

§ Mr. MARRIOTT
It would mean an increase of Government liability.

§ Sir F. BANBURY
It might lead to unreasonable wages being demanded, and I do not want to do anything to support an abnormal rate of wages or to have them kept up by payment of Government money. I would like to know what happens in a strike.

§ Sir R. HORNE
When a man is on strike his union may pay him strike pay, but he does not get unemployment pay or any subvention from the Government.

§ Mr. S. WALSH
Tradesmen who are thrown out contingent, on a strike get benefit but not the strikers.

§ The CHAIRMAN (Mr. Whitley)
How does the right hon. Baronet connect this with the Amendment?

§ Sir F. BANBURY
I do not connect it, and I do not propose to pursue it. Under 1858 those circumstances I will not press the Amendment, though I regret some limit has not been introduced. A good many years ago when I first proposed Amendments of this kind to Financial Resolutions they met with more or less derision from all sides, but opinion has considerably changed, and Governments of late have been inclined to accept limiting. Resolutions, and in many instances they have done so.