ECONOMY (MISCELLANEOUS PROVISIONS) [MONEY].

HC Deb 13 April 1926 vol 194 cc37-102

Considered in Committee, under Standing Order No. 71A.

[Mr. JAMES HOPE in the Chair.]

Motion made, and Question proposed, That for the purposes of any Act of the present Session to make provision for reducing in respect of certain services the charges on public funds and for increasing, by means of the payment into the Exchequer of certain sums and otherwise, the funds available for meeting such charges, and to amend accordingly the Law relating to National Health Insurance and certain other matters and for purposes related or incidental thereto, it is expedient to amend Section fifty-nine of the National Health Insurance Act, 1924, by repealing the words ' other than additional benefits ' in paragraph (e) of Sub-section (1) thereof and to authorise the payment out of moneys provided by Parliament of such additional sums as may be required for the purpose of defraying the proper proportion of the costs of any additional benefits to which men of the forces may under the said Act become entitled out of the Navy, Army, and Air Force Insurance Fund."—(King's Recommendation signified.) — [Mr. Ronald McNeill.]

Mr. LLOYD GEORGE

Is there to be no explanation of this very important Resolution? We are all waiting to hear.

The SECRETARY of STATE for WAR (Sir Laming Worthington-Evans)

The Resolution has one effect and one only, namely, that it enables the members of the fighting forces in future to obtain additional benefits beyond the benefits which are provided under the existing National Health Insurance Act, and it calls upon the Slate to contribute one-seventh of the cost of those benefits, and consequently throws a liability upon the Exchequer and necessitates this Resolution. The estimated cost falling upon the State of that addition to the benefits is £3,000 per annum. Perhaps I had better explain briefly what are the existing provisions of the National Health Insurance Act with regard to serving soldiers, sailors and airmen. Under the Act the soldier—I take the soldier as an example, but the same arrangements apply to the airman and the sailor—pays nothing to the National Insurance Fund so long as he is in the Service, but the Department makes a contribution to the National Insurance Fund which enables the soldier, while he is in the Army, to receive maternity benefit, but no other benefit, because the other benefits are already provided by the terms of his service. Further, in the contribution made by the Department, there is a sufficient sum to enable that soldier, when he leaves the Service, to join an approved society, if his health permits him to do so, as a fully paid-up member. He can, from the moment of his re-entry into civil life, receive exactly the same benefits as he would have received had he been a member of an approved society during the time he was in the Army.

There is another class, however, to whom that arrangement does not apply. There is the man whose health has been impaired during service and whom no society will accept as a member, and for that man there is the Navy, Army and Air Force Insurance Fund, set up under the Act of 1911 and consolidated under the Act of 1924. A soldier in impaired health can remain a member of that fund, and I think about 23,300 are now members of it. Under the Act, however, they are only entitled to standard benefits and not to any additional benefits such as they would have received as members of approved societies. The alteration we are now making will give the Navy. Army and Air Force Insurance Fund the right to pay, not merely standard benefit, but also additional benefits equal to the average benefits payable by approved societies. In order to do so a fund is created which I shall have to explain on the next Resolution. There will be an annual charge. The State will have to make a contribution of one-seventh to the benefits that will be payable, and consequently, a liability of about £3,000 a year will be thrown upon the State. This Resolution is required in order to permit that to be done.

Mr. J. H. THOMAS

Will the right hon. Gentleman tell the Committee who determines the additional benefits, and what they are?

Sir L. WORTHINGTON-EVANS

That is a question which I shall be very glad to answer, but it would be more appro- priate to deal with it on Clause 5 of the Economy Bill relating to that matter [HON. MEMBERS: "NO!"]

Mr. THOMAS

In Clause 5 of the Economy Bill you are robbing the Fund, but I want the right hon. Gentleman to explain these additional benefits and to state what they are, under the Resolution with which we are now dealing. Clause 5 takes away money which was for additional benefits.

Sir L. WORTHINGTON-EVANS

The right hon. Gentleman, under the cloak of a question, makes a serious accusation which he has no right to make, and suggests that we are robbing the Fund—

The CHAIRMAN

I have given full attention to this Resolution as well as to the Resolution which will follow in Committee of Ways and Means, and I think it will be for the convenience of Members to discuss the two subjects together now. I am, of course, in the hands of the Committee in this matter, but I think it would be inconvenient if I had to rule very strictly throughout a discussion confined to one of the Resolutions. I, therefore, suggest that both might be discussed now without prejudice to any Division which may take place.

Mr. THOMAS

I think the Committee appreciate your difficulty, Sir, and your genuine attempt to get over it; incidentally, that is the answer to the suggestion of the right hon. Gentleman opposite that I am using a cloak under which to make a charge. I think hon. Members would be wise to accept the suggestion of the Chair without any prejudice to a Division afterwards.

Mr. LLOYD GEORGE

I quite agree that it is impossible to discuss this subject piecemeal and I only intervened originally because I desired to get a general exposition from the Secretary of State for War of what the actual proposal was, so that the Committee might be in full possession of the facts. If I may respectfully say so, I think the Chairman's suggestion is admirable and it would answer the purposes of debate very much better if we were prepared to discuss both subjects upon the one Resolution and under the usual conditions.

Sir L. WORTHINGTON-EVANS

If that be the desire of the Committee, I shall be very glad indeed to deal with the other question and, incidentally, to answer the charge of robbery which was quite unjustly made by the right hon. Gentleman the Member for Derby (Mr. Thomas). I have already explained what the particular Fund is, and I had better add to that explanation, a statement of the financial arrangements which will maintain that Fund in solvency and render it able to pay the additional benefits which are intended. If hon. Members have read the Report of the Government Actuary which has been circulated with the Bill, they will see that there was a surplus as at 31st December, 1924, of £1,424,000 on the Army, Navy and Air Force Insurance Fund, after providing for all liabilities for ordinary benefits, but not for additional benefits. It is there stated that the value of that money is now about £1,500,000, because interest has been added since. It is proposed to transfer, not £1,500,000 but £1,100,000 of that surplus, or, in other words, to leave in that Fund £400,000, and the Government Actuary has advised us that the £400,000 would be sufficient to enable the Fund to bear additional benefits to the average of those which are paid by the approved societies.

Sir JOHN SIMON

In which paragraph of the Report does the Actuary say so?

Sir L. WORTHINGTON-EVANS

I thought it was in the Report, but if it is not, the right hon. and learned Gentleman can take it from me that I have been advised by the Government Actuary that £400,000 is sufficient for the purposes I have stated. I thought, however, it was actually set out in the Report.

Sir J. SIMON

It may be. Is it in paragraph 17?

Sir L. WORTHINGTON-EVANS

By implication it is in paragraph 17—in fact, I think hon. Members will find there a direct statement which substantiates what I have said. I think they will find it stated that, after assigning a sum of £400,000 to the provision of additional benefits, the balance of the surplus is £1,100,000 and that this it is proposed to carry forward to the Exchequer. I can relieve the mind of the right hon. and learned Gentleman on the subject, in any case, because, supposing by any chance a miscalculation has been made, the solvency of the Fund is guaranteed by the Department and always has been so guaranteed. Under the 1911 Act the contribution to be made by the Government Department in respect of certain men is to be a sum sufficient to keep the Fund solvent and this provision has been repeated in the Act of 1924. Section 59 (B) of that Act says: The weekly contributions to be made by the Admiralty, Army Council, or Air Council in respect of men of the forces shall be such as may from time to time be required to keep the Fund solvent. It is an unconditional guarantee by the Government Departments to make weekly contributions sufficient to keep the Fund solvent. Therefore, the whole of the story that is embodied in these two Resolutions is this, that whatever hon. Members opposite may say about other parts of the Economy Bill, this part of the Economy Bill gives a greater benefit to the serving soldiers, sailors and airmen than they had before. It gives them a right, not merely to ordinary benefits, but to additional benefits equal to the average of the friendly society benefits.

Mr. THOMAS

The object of this Resolution is to give the soldier the same advantages as the civilian for additional benefits. If that be so, will the right hon. Gentleman tell us whether the additional benefits contemplated are the benefits now given by the best or any approved societies, whether they are also the benefits foreshadowed in the Commission's Report, and, if the latter, whether the £1,100,000 that he is taking away is not money that was contemplated as a surplus for additional benefits?

Sir L. WORTHINGTON-EVANS

No. Let me answer the last part of the question first. because it deals with figures and is rather more difficult to follow. The right hon. Gentleman says, "There is a surplus of £1,100,000; was not that intended to be a fund out of which further benefits could be obtainable by the soldier?" No, it was not: and it never was, because under the Act the benefits that the soldier remaining on this Fund was to get were limited to ordinary benefits. There was a specific provision that he should not get additional benefits of any sort at all, and the reason for that was that the Departments were guarantee- ing the Fund. They were not guaranteeing more than ordinary benefits; they were not guaranteeing additional benefits. The ordinary benefits are payable to-day, but what I want to get for the soldier and sailor is something equal to the average of the benefits paid by the approved societies. If they are in good health when they leave the Service, they go to an approved society; if they are in bad health, I do not think the State ought to give them less because their health is bad in the service of the State than they would have got if their health had not been bad in the service of the State, and, consequently, they are going to have benefits equal to the average benefits paid by the approved societies.

The right hon. Gentleman asked me whether they were specified. No, they are not. They are going to be specified in the regulations which will be made under the Act. Obviously, you cannot specify them in advance. Far from there being any robbery of £1,100,000, that is a pure surplus. It is not available for use for additional or any other benefits. It is there, and if it were not transferred under the Economy Bill, the soldiers would not get it. What would happen to it would be this, that the Departments, instead of contributing 3½d. a week for those who were insured in their service, would make a lower contribution, and gradually the £1,100,000 would be absorbed by lower contributions. None of the serving soldiers, sailors, or airmen would get it at all. All that would happen would be that in future lower contributions would be paid, and it would be gradually absorbed over a series of years. Instead of doing that, we are taking every precaution that the Fund shall be solvent. On our actuary's advice, we are widening the benefits to be given, and transferring the surplus to the Exchequer, which badly needs it, but not as a robbery, because the guarantee of the Government of the solvency of the Fund still remains.

Mr. RHYS DAVIES

I feel sure the Committee will agree when I say that the right hon. Gentleman has not given an adequate explanation of these two Motions. In fact, he has made the most amazing statement I have ever heard from that Box. He has told the Committee to-day that the Government, while taking ½1,100,000 out of this Fund, are not robbing the Fund at all. If I under- stand English vocabulary, that is simply robbing and nothing else. It cannot be anything else.

Sir L. WORTHINGTON-EVANS

Whom does it rob?

Mr. DAVIES

You are robbing the Fund and the soldiers and sailors who contribute to it. The points I desire to put to the right hon. Gentleman are these: There is a series of Regulations governing this Fund, and one of them refers to the setting up of an advisory committee. I will read the Regulation, so that the right hon. Gentleman might know exactly what I am aiming at. It declares that, For the purpose of advising the Minister as to the administration of benefits payable out of the Fund, and as to the admission to benefit of seamen, soldiers, and airmen, there shall he constituted an Advisory Committee. As far as I understand Regulation 20, the Minister is supposed to ask the advice of that Committee before tampering in any way whatsoever with the Fund. I want to know, in the first place, whether this committee has been set up, and, if so, what is the personnel of the committee, and what is the advice given by the committee to the Minister in respect of this Fund.

I am astonished at the arguments used by the right hon. Gentleman. He has tried to make the Committee believe that the soldiers, sailors, and airmen under this new scheme are going to get benefits equal to the average additional benefits, I took him to say, payable by the approved societies. Several of the approved societies, on the second valuation, will be able to pay additional benefits covering five out of the 14 comprising the Schedule. Other approved societies will be absolutely in deficiency. I take it from the argument used by the right hon. Gentleman that what is intended to be done under this scheme is to say: "Deficiencies and surpluses of approved societies will be pooled, and we will strike an average, and then base the additional benefits to be paid from this fund on the average payable by approved societies."

The other question I want to put to the right hon. Gentleman is this: The contributions to this Fund for the last year for which figures are available, are as follow: The gross contributions are £35,738, but the total benefits payable from the Fund, according to the last balance-sheet, amounted to £49,000. That, in effect, shows that the Fund disclosed a loss of about £14,000 in one year. If the Fund shows £14,000 lass in one year, and the Government are taking in addition £1,100,000 from the Fund, how is the Fund then going to pay additional benefits on the lines suggested by the right hon. Gentleman? The explanation of the right hon. Gentleman really will not do. He has not told us how many members there are in this Fund. Am I right in stating that this Fund has to provide ultimately for 33,000 men? Am I right also in assuming that when the £1,100,000 is taken from the Fund, there will be £400,000 only left available for additional benefits for these men?

I take it that is the case. Now let us see where we stand. The right hon. Gentleman states, and the Regulation proves in part what he says in this connection, that this Fund does not belong now to the men who served in the last War. This Fund deals exclusively, as I understand, with men of the Regular forces. You must, therefore, divide the men who served in the Army during the last War from the men who are now serving in the Regular forces. There are 33,000 men, I understand, in this Fund. Will the right hon. Gentleman reply to this question? I understood him to say that the Government make themselves responsible for any insolvency which may occur in this Fund. Do I understand that the Fund is going to be treated as if it were an approved society? If so, is it going to be dealt with under one of the Clauses included in the Economy Bill, where, upon the certificate of an actuary submitted to the Ministry of Health and the Treasury, the Government will make good any deficiency in connection with the Fund?

Let me put another question appertaining to that point. What additional benefits is it proposed to pay from this Fund? The Parliamentary Secretary to the Ministry of Health knows a great deal about the number of additional benefits which are contained in the Schedule of the Act of 1911. He knows, too, that Approved Societies, in the main, have adopted not more than three of these additional benefits—dental treatment and appliances, optical treatment and appliances, and surgical appliances. A few approved societies have adopted convalescent homes; others pay contributions to hospitals, voluntary and otherwise. Will those 33,000 men, or that number of them who are dischaged from the Army, automatically come on to the Fund for additional benefits both in cash and in kind, just as if they were members of Approved Societies? The right hon. Gentleman surely ought to have read the Report of the Royal Commission on this subject before he spoke.

I am very glad that it is possible by your ruling, Mr. Hope, to discuss Resolutions 1 and 2 upon this fundamental issue. This question we are discussing to-day is a very important one, indeed, especially to the men who are discharged from the Forces suffering from disease. They are compelled, in fact, if they are well in health, to return to the Approved Society of which they were members before they joined the Forces, but there are hundreds upon hundreds of men discharged from His Majesty's Forces suffering from consumption, and the Government Department declare that the disease from which they are suffering is not attributable to their service with the Regular Forces. Does this proposal of the Government mean that additional benefits in kind which may be paid under this scheme are going to be extended to cover the cases of men suffering from consumption, or are they going to be confined purely and simply to dental, optical and surgical appliances, and so forth?

Let us now see what the Royal Commission say upon the subject. This is their recommendation; but this Government have a habit of taking no notice of recommendations just now. They take no heed at all of the Report of their own Commission. The Royal Commission was composed of persons appointed by the Government some time ago, men and women well versed in National Health Insurance. They know the administration of the scheme from top to bottom, and this is what they say: That members of the Navy, Army and Air Force Insurance Fund who transfer to an Approved Society on their discharge from the Forces should for the purpose of title to additional benefits, be treated as though they had been members of the Society from the date of their joining the Forces, and that to enable this to be done the transfer values payable out of the Navy, Army and Air Force Insurance Fund in respect of such men should be augmented by the estimated share of surplus earned during their period of service. Does the right hon. Gentleman intend that part of the £400,000, to which he has referred is to be handed over to the approved societies who accept men who come out of the Army and who are compelled by Regulations to join an approved society; or is he keeping the whole of the £400,000 to pay additional benefits to men who form this new approved society called the Navy, Army and Air Force Insurance Fund Society? The Commission go further and say: That, apart from the modifications to which we have referred, no change should be made with regard to the insurance of men serving in the Forces of the Crown. That is definite enough. The Commission request the Government not to interfere in any way whatsoever with this Fund, and the Commission knew quite well how the Fund was established. They knew the amount of contributions paid by the Government and the men towards the Fund. They knew the exact weekly contributions paid by the men and the Government; and, still, after careful consideration, they came to the conclusion that the Fund should not be disturbed. Yet to-day the Government come forward with a Resolution saying that they propose taking away £1,100,000; and, in order to delude these 33,000 men, they turn round, after stealing £1,100,000 from them, and say, "We are not going to take anything from you; in fact, we are going to give you additional benefits just as if you were members of an approved society." I have never heard anything so hypocritical before. I wish the Parliamentary Secretary to the Ministry of Health was in his place. He has been making excuses for the Government in respect of this Economy Bill and has recently issued an edict from the Ministry of Health; and this is what he says: A disposable surplus of £9,000,000 is available as a result of the first valuation of Approved Societies, and the still larger disposable surplus "—

The CHAIRMAN

How can the hon. Gentleman connect this with an argument relating to the Army and Navy Fund?

Mr. DAVIES

I was only using that as an illustration because the Government propose by these two Resolutions to connect the additional benefits they propose to pay under this Fund with the additional benefits payable by approved societies. Now, having used it only as an argument, I will refer to another point I desire to make. I do not know whether the right hon. Gentleman has taken into account the position of men who were serving in the Great War, and do not in fact fall within the scope of this Fund. I am wondering whether the Government have really taken heed of that point, as there are thousands upon thousands of men who served in the last War, and in respect of whom contributions were paid to this Fund. Many are now thrown on the funds of approved societies. They are receiving nothing at all from Approved Societies, except one shilling a week by way of disablement benefit, and I should have thought, instead of taking £1,100,000 in this way, in order to relieve the taxpayer of his Income Tax, that the Government, which talked so glibly during the War about the rights of men serving His Majesty and all the rest of it, could give that money in order to help these poor fellows, who get so little through approved societies, and so fulfil the glorious promises made during the War.

4.0 P.M.

I want to press the two main questions I have put to the right hon. Gentleman. Have the Government yet appointed the Advisory Committee according to Regulation 20? Can he say, yes or now now? It will help me if he can. I would not be surprised if the Advisory Committee had not been appointed at all. As a matter of fact, even when this Government does appoint a consultative council or advisory committee in this connection, they never take their advice; they just do what they like. That was their attitude with regard to the Consultative Council of the Ministry of Health. They took no account at all of the decisions of that Consultative Council. I take it for granted, as the right hon. Gentleman does not reply, that the Committee has never been appointed. I understand, according to Regulation No. 20, issued in 1924, some representatives on this Advisory Committee were to come from the men themselves in respect of whom contributions are paid, and, after all, these 33,000 men who are serving in the Forces are the people most concerned in this question. They are the people who suffer from the diminution in benefits as a consequence of the proposals of the Government.

I cannot understand how the right hon. Gentleman comes to argue that these men will not suffer in the least in spite of the fact that over £1,000,000 is taken from their funds. I will try and explain to him what the Government are doing. It is quite true that these men will not suffer any reduction in benefit now, but, if the £1,100,000 remained in the Fund over a period of three or four years, they would then be entitled to benefits which they will not receive if the £1,100,000 is taken away, and we on this side of the House protest against this method of dealing with the accounts of the National Insurance Acts. I trust the right hon. Gentleman will be more happy when he stands up at that Box again. I think the Government, or some members of the Government are absolutely sick of the activities of the Chancellor of the Exchequer in this connection. I felt, when the Minister of Health was speaking the other day on the Bill, and when the right hon. Gentleman was speaking this afternoon, that they were absolutely unhappy —I do not know whether this is Parliamentary language or not—in doing what I regard as the dirty work of the Chancellor of the Exchequer: because it is nothing more nor less than that. We on this side of the House propose telling the people of the country the whole truth of what is happening in this connection. If the Government will not be frank and will not declare that they are actually depriving these million people of this money—

The CHAIRMAN

The hon. Member himself has just stated that there are only 33,000 of them.

Mr. DAVIES

But the 33,000 are surely related to the other millions. They are sons of some of the millions. I trust the right hon. Gentleman will give the Committee this afternoon very much more details of the proposal of the Government than he has yet done. There are other points in this connection which we shall put later on to-night; and, whenever the Bill comes before the House again, we hope to pursue our opposition to it, because it is unfair and unjust, and it limits definitely the benefits that ought to be paid and promised. The right hon. Gentleman shakes his head, but he knows as well as I do that, if you take £1,100,000 from this Fund, you will reduce the benefits of these men that otherwise they would be entitled to receive.

Sir L. WORTHINGTON-EVANS indicated dissent.

Mr. DAVIES

Of course, you would. The same foolish argument has been used throughout in connection with the finances of this scheme. One right hon. Gentle man said the other day: "Of course, we are going to take £8,000,000 away from the funds, but we are not going to reduce your benefits." You are not going to reduce the current benefits, but what we protest against is that you are going to reduce the prospective benefits to which these people are entitled and which, in fact, they have been promised. We, on this side of the House, shall protest against the way in which the Government are handling this problem. They are taking away money to which the Treasury is not entitled. They are going to take £1,100,000 from serving soldiers in order to relieve the taxpayers; and, so far as we are concerned, we shall object at every stage to the way in which the Government are performing their ugly tasks.

Mr. HORE-BELISHA

The right hon. Gentleman the Secretary of State for War has proposed two Resolutions, by one of which the Navy, Army, and Air Forces are to benefit to the extent, we are told, of £3,000 per annum, and by the other of which they are to be deprived of £1,000,000. The right hon. Gentleman has endeavoured to draw a nice distinction between what he calls a "transfer" and what other people call "robbery." Why cannot he be honest about it? If he is taking this money away from the soldiers and sailors, why cannot he admit it? After all, they belong to a Service which understands the ordinary meaning of the English language, and they will not be in the least deceived by the refinements of expression used by the right hon. Gentleman. Where does this money, which the right hon. Gentleman is taking, come from? He says that it belongs to nobody. If it belongs to nobody, he is the last person who has a right to transfer it to the Exchequer. This money comes partly from the living and partly from the dead. It is the money, not only of the living but of those who fell in the War, that he is robbing by these Resolutions. The Actuary's report says that this reserve, which he is plundering, has accrued in respect of men who were killed during the War or who died as the result of wounds received or diseases contracted during the War. That is the money that the right hon. Gentleman is taking. He represents a Government which expresses much solicitude for the Service and for ex-service men, and this is one of the methods by which he demonstrates the effectiveness of that solicitude. It is a cruel and a callous thing to choose this moment after the Great War, because the Exchequer is in need, to come down upon a helpless body of men who cannot go on strike as the miners can to defend their rights.

Under the original Act, this money was contributed by the sailors and soldiers themselves. They made a direct contribution under the original Act out of their own pay. It was stopped out of their own pay. Later on, for the purpose of facilitating the administration, the State paid the money directly instead of paying it to them in the form of their weekly emoluments. That is the history of the transaction, and, whichever way you put it, there can be no doubt whatever that this money which comes out of the Navy, Army, and Air Force Votes is the money of the sailors and soldiers and airmen. The right hon. Gentleman says that the money is useless where it is. It was destined to provide maternity benefits, and we cannot use it for any other purpose. Surely, it would have been perfectly simple, if the right hon. Gentleman's Government had cared for the sailors and soldiers, to have provided some other method of expenditure which would have redounded to their advantage. The Government have just reduced the pay of the sailors and soldiers. New entrants are getting a lower rate of pay than those serving under existing contracts. This is a double reduction of their pay, because the right hon. Gentleman is taking from them that to which they are entitled, and, in addition, he is taking away the means by which they keep their families alive.

The sailors and soldiers, as a whole, have never had any advantage from this fund. All they get is £2 when their wives have a child. That sum is paid outright as the fee of tire midwife, or for something else. The sailors and soldiers have many needs which are generally recognised, and, instead of allowing them or their wives or widows to be thrown upon charity, this money could have been used to provide them, as in the case of foreign seamen, with a pension fund to improve their status and to facilitate their passage through life. There are a thousand and one things that the right hon. Gentleman could have done with this fund. He is just reducing the marriage allowance of naval ratings. Could he not have kept the marriage allowance at its present figure rather than take this money away for the benefit of the Exchequer? How is this benefit of £3,000 which comes under the first Resolution to be given to the sailors and soldiers? It is to be given to them at the expense of the approved societies. He is throwing these men on to the funds of the approved societies. There never was a more damnable piece of robbery, not only from the sailors and soldiers—

The CHAIRMAN

I think the hon. Gentleman is now getting beyond the line.

Mr. HORE-BELISHA

It is difficult to find relevant language in which to condemn the action of the right hon. Gentleman. It is useless for him to say that he is taking this £1,000,000 away for their own good. I remember when I at school that whenever the cane was administered to me I was always informed that it was for my own good. I used to be very sceptical about that at the time, but, however much I may have deserved the cane while at school, there is no justification whatever for taking this money away from the sailors, soldiers and airmen who helped us during the War and informing them gladly that it is done for their own good.

Mr. LLOYD GEORGE

I should like to say a few words about this matter before we come to a decision. This is in a different position than even the transaction we discussed at some length before the Recess. That was discontinuing to the extent of £2,800,000 a grant which was annually voted by Parliament. We maintained that that was a breach of a pledge, but this is in a different and a worse position than that transaction. This is taking away an accumulated fund which belongs as much to the people for whom it was designed as any investment belonging to any person in this Kingdom. It is taking away money which belongs to another as much as if you raided the reserve of a bank or the reserve money of a public company. The fact that it has been accumulated in pennies and three-halfpennies makes it worse and not better. If you set aside £150,000 out of the profits of the year to a reserve fund and you build up a great reserve to meet a rainy day for a company, anybody who came and proposed that it should be taken away would be called a robber. That is a word which we have been taught by hon. Gentlemen opposite whenever we have put up the Super-tax. It would be regarded as confiscation. What is the difference between £150,000 voted out of profitable transactions at the end of a year to a reserve and money which has been accumulated out of the pennies and three-halfpennies of sailors and soldiers who have been risking their lives for their country? This is worse. [Interruption.] There is an hon. Gentleman who says that it is a laughing matter. Let him say so in public. He laughs when one refers to the sacrifices of the soldiers and sailors. [HON. MEMBERS: "No! "] He certainly did.

Mr. WOMERSLEY

I smiled at the right hon. Gentleman's argument.

Mr. LLOYD GEORGE

The hon. Gentleman thinks it is very amusing in me to use an argument which says that it is wrong to take away the reserves of a profitable company and to compare that with taking three halfpennies away which have been saved by soldiers and sailors. I say it is the same transaction and that it is infinitely worse. I will give him an argument from one of his own leaders, and I want him, if he will, to laugh at that. The Chancellor of the Exchequer is the Minister responsible for this transaction, and he is never here to defend it. I remember during the War there was a legend at the front that the soldiers never got anything but plum and apple jam, and that somebody at the base took away the strawberry jam. The gentleman who is intercepting the strawberry jam is not here, and he has left it to a War Office "dug-out" to defend his action. Now I am to point out, not merely for the benefit of this hon. Gentleman who is so amused, but for the benefit of others, that the proposition laid down by the Chancellor of the Exchequer is that all this money is in the nature of an investment. This is what he said about it last year: In the new Pensions Bill now before Parliament they had one method of multiplying the small property-holder, for, after all, insurance on the contributory system was a very direct and obvious form of thrift and saving. That is the proposition. The three halfpennies is thrift and saving; it is the creation of a small property, and all the money which has been put in and accumulated to the extent of £1,100,000 is a property which has been saved by those soldiers and sailors, and no one has any right to rob them of their little property. The right hon. Gentleman says, "I am giving them £3,000 a year." £3,000 a year at 5 per cent, is £60,000. He is taking away £1,100,000 and he says: "It is perfectly true that I am taking away that sum of your savings, but I am giving you£60,000 until another Chancellor of the Exchequer comes again and takes it away. We are gentlemen robbers. We do leave at any rate a little behind." He may say that is not robbery. Would he mind explaining it in view of the declaration of the Chancellor of the Exchequer that these accumulated funds belong just as much to the contributor as any savings or any money which you have invested by your thrift in the bank? What is the difference between them?

That is why I thank this transaction is infinitely worse than any transaction which up to the present we have been criticising and condemning. Surely, as my hon. Friend who has just sat down has pointed out, this is hardly a time to do it. Before the War we owed a good deal to these gallant men, hut since then they have undertaken to defend the honour and safety of this country at the risk of their lives, and they had to face the greatest and most terrible war in history. They have had to face privations and perils, such as no sailors and soldiers in the history of any war have ever had continuously to face. During the Recess I was reading rather an interesting account in a. very brilliant book which has been issued about the fighting in Flanders, written by a soldier.

He says it was not so much the perils to life but it was the privations they endured, which were inconceivable. I come from reading that book to be asked to vote that £1,100,000 of the money which has been saved by those men out of their pennies and three halfpennies should be taken away—money that was accumulated in consequence of the fact that many of them have sacrificed their lives.

It is one of the most discreditable transactions in the history of any Government, and I do hope that the appeal will not be made in vain to many hon. Members and right hon. Members on the other side of the House. I cannot believe that my right hon. Friend the Secretary of State for War really has his heart in this transaction. With his usual chivalry, he comes forward to defend it, but I do not believe that in his heart he approves of it. I am sure he thinks it is a mean transaction. It is a foolish one from every point of view. You are dealing with men who, by the very discipline of the Forces, cannot protest. Approved Societies can pass resolutions; they can hold great gatherings during the Easter Recess and protest and send in resolutions; they can go to meetings at East Ham and elsewhere, and protest very effectually, and they can write to Members of Parliament to protest. But the anon we are concerned with cannot do it, under pain of infringing the strict Army Regulations. I think you might leave them out. It is not worth doing. It is not as if the country were in great distress and needed the £1,100,000. It needs nothing more deeply than the loyalty of the gallant men who helped to save its honour, and to save the freedom and independence of the whole world. I beg the Government to reconsider the proposal. Even if they cannot meet us on other things, I ask them for their own honour and the honour of the House of Commons not to proceed with this discreditable transaction.

Sir L. WORTHINGTON-EVANS

The right hon. Gentleman has made a speech which makes me wonder whether he has any knowledge of the proposals of the Government Measure, or any recollection of what he himself put into the National Insurance Bill in 1911. I am not a bit surprised that my friend beside him laughed at the absurdity of the arguments of the right hon. Gentleman. He was not laughing at his references to the sacrifices of the men in the War, and the right hon. Gentleman knew it, but he chose to turn round upon him and saddle him with a laugh at something which he never was laughing at at all. The right hon. Gentleman says we are robbing the accumulated savings of the soldier.

Mr. LLOYD GEORGE

Yes.

Sir L. WORTHINGTON-EVANS

It is untrue. This Fund was compiled by contributions of the soliders' arid sailors' three-halfpence which was deducted from their pay for a few years, but, after that, the Department themselves took upon themselves the full payments, and no deduction was made from the soldiers or sailors or airmen's pay.

Mr. LLOYD GEORGE

The right hon. Gentleman knows perfectly well that I was just as much in that transaction as he was. There was an arrangement made to increase the soldiers' and sailors' pay, and this was simply taken as part of that transaction, and, since he has been good enough to say I knew a certain thing, then again I say that he knows that when he makes that statement.

Sir L. WORTHINGTON-EVANS

No. Let us see what this fund is. Whether this fund is built up from the pennies of the soldiers and sailors, or from the Government Departments, it is, as a matter of fact, built up from the money voted by this House in the Army, Navy and Air Votes. At the time of discharge those men whose health was unimpaired were able to join approved societies and get full benefit, and those men are not affected by anything we are doing in this Bill. The only people who could in any way be affected are the 23,000, not 33,000 who are now there, and those who are being discharged in future with impaired health and who are unable to join friendly societies. They are being discharged at the moment at a rate of about 400 a year. What benefits are they entitled to receive? The men in the forces, discharged, etc., shall be entitled to benefits other than additional benefits at the ordinary rates. That is all they are entitled to at this present moment. The Government Actuary says that, after making all provision for payments under that Section of the Act of Parliament, there is a surplus of £1,500,000.

That surplus is not the result of the savings of the three halfpennies and the pennies. These were only to give maternity benefits, and give the men their right to join approved societies. This fund is accumulated out of Government contributions.

Sir ROBERT HUTCHISON

And the men's contributions.

Sir L. WORTHINGTON-EVANS

No.

Sir R. HUTCHISON

Surely under the Act of 1911 the men contributed 1½d. of their pay?

Sir L. WORTHINGTON-EVANS

Up to 1920 that was the ease, but since 1920 it has been paid by the Government Departments out of the funds voted by this House. [HON. MEMBERS: "It was part of the wages!"] it does not make any difference whether it is deducted from wages or added to the wages.

Mr. RAMSAY MacDONALD

If the right hon. Gentleman admits that this may be regarded as partly a wages deduction, then the £1,100,000 does not belong to the Government at all.

Sir L. WORTHINGTON-EVANS

The right hon. Gentleman is confusing two things. The penny halfpenny contributed was not more than the amount required for the maternity benefit, and for making the man free of the approved societies as at the age of 16, although he joins when he leaves the Army, whether at the age of 26 or 30 or 36.

Mr. WALLHEAD

Where does this surplus come from?

Sir L. WORTHINGTON-EVANS

From the Government contribution. Let us take this one step further. Let us assume, for the purpose of argument, that the surplus, if you like, arose out of the men's fund. Under the Act, they are only entitled to benefit. without those additional benefits, at the ordinary rates.

Mr. MacDONALD

In order to complete the argument. under the Act the Government are not entitled to help themselves to the £1,100,000. They have, therefore, to produce a new Act to give them power to use that money. Why are they taking power to take the money for themselves without making an equitable distribution of that surplus?

Sir L. WORTHINGTON-EVANS

I am very glad to answer that. Under the Act as it at present exists the whole of that surplus could be absorbed by the Government without any further sanction from the House at all. It would be absorbed in this way. The Government are now bound to make weekly contributions sufficient to keep the Fund solvent. That is provided in the Act. It would absorb, therefore, the whole of this £1,500,000 by reducing the weekly contribution. That is what would happen supposing this House were to reject the proposals now before it. I hope the House will not reject them for this reason, that, far from robbing the sailors and soldiers and the airmen, we are giving them, not £3,000 a year only, as the right hon. Gentleman has said, but £400,000, which is taken from the £1,500.000 and is set aside—for what purpose? For the purpose of giving additional benefits to which the men are not now entitled. Am I not right in saying that this is a gift to the soldiers, sailors and airmen? Hon. Members will not realise what it is a serving soldier is now entitled to. He is entitled now to ordinary benefits and not to additional benefits. We are now providing that he shall have additional benefits equal to the average of those benefits given by the approved societies, and in order that the Fund shall remain solvent we are giving £400,000 for that purpose. There is £1,100,000 to be transferred to the Chancellor of the Exchequer, and if it were not now transferred it would be absorbed in the course of the next years by the reduction of the contributions required under the Act.

How can anyone say, as has continuously been said, that some harm is being done to the members of the fighting forces? Quite the contrary. Not only is no harm being done, but a great benefit is being given to them, because they are being put on a par with the average of the approved societies, though for the purposes of prejudice and party advantage hon. Members and right hon. Gentleman opposite do not appear to be ashamed to call this proposal, which they ought to understand, by names which will mislead those who have not the opportunity to study the matter carefully, and I can only regret that the hon. Member for Carnarvon Boroughs (Mr. Lloyd George) has joined their ranks.

Mr. ATTLEE

I can quite understand the heat of the right hon. Gentleman opposite in suggesting that any Member of the House should ever make party capital out of an Insurance Scheme, but I am rather amazed at the exhibition we have had of the new morality of the right hon. Gentleman. He has the morality of the schoolboy who robs the nest, and hopes it will be all right if he puts one egg back. That is one line. The other line we have had is, "Oh, but this is not really robbing the soldiers and sailors, because this Fund does not really belong to anyone, and so we just came along and thought we might take it." That is the second line. Then there is the third plea of saying, "Oh, no; we are not really committing any act of robbery; it is true we are taking the £1,100,000 in order to make up a deficit in our Budget, but we are not robbing anyone except future generations." Future Chancellors of the Exchequer apparently will have to make payments into this Fund year by year from their Budgets in order to make up for the luxury of the Chancellor of the Exchequer being able to balance his Budget by stealing this £1,100,000 at this time.

Let us look at the real facts of the case, because they have been a good deal clouded by the diverse explanations we have had from right hon. Gentlemen opposite. This Fund has been built up out of contributions. I rather like to take the Government Actuary's statement. as to how this Fund has been built up, because I think it is really more straightforward and fuller than that of the right. hon. Gentleman opposite. First of all, we find it has been built up by contributions made by soldiers and sailors. I do not think we need go any more into any of those questions whether it was paid as direct wages or in deductions, or whether it was paid by the Government in lieu of advances in pay. The fact remains it was built up by the contributions of soldiers and sailors. Next we find that this surplus has arisen because of the greater interest than 3 per cent. which has been paid on the Fund. I wonder why the Chancellor of the Exchequer does not go elsewhere and look around and find out other rentiers who have profited by the rise in interest. Our soldiers and sailors are not the only ones. who have profited by this rise in the rate of interest on the Fund. What about the banks and all the other people?

The CHAIRMAN

I am afraid the hon. Gentleman is getting rather away from his argument.

Mr. ATTLEE

I will not labour that. I think it is sufficient to indicate the reply to the argument that this advance over three per cent. is a special reason why this should be done. I should like to know why it is wrong that a Fund which belongs to a number of rather impecunious individuals should not have the profit which has come to great numbers of people through the rise in the rate of interest. But there is an offset to that. Take the instance of a sergeant-major who joined the Army before the War, and paid in his pence to this Fund. He paid in his pence, and if they amounted to a pound, that pound was then worth 20s. When he comes to draw his benefit he is only going to get a pound worth 12s. If it is fair to say he should not have the advantage of any advance in the rate of interest, why should he have the disadvantage on the other side by the change in prices. I should have thought that ought to be taken into account.

Let us look into the matter a little further. We find that this Fund was built up by various contributions. There were the contributions of a number of men who joined it for the duration of the War, and therefore contributions were paid, and they afterwards did not come back to insurable employment. They paid that money and it went into the Fund. I do not think those people who paid that money wanted that Fund specially to go to relieve the needs of a Chancellor of the Exchequer who finds himself in difficulties owing to his over-generosity to his wealthy Income Tax payers and Super-tax payers last year. Then a large amount of this Fund was from the reserve values in respect of the men who died in the War. It is an extraordinary thing, because the Chancellor of the Exchequer, who actually served in the War, collects moneys which became due in respect of those who died in the War and puts them to the benefit for the most part of people who did not take part in the War, but did well out of it. He has not shown that he has any right to take this money for this purpose. He has not shown in the least why he should not use it for some other benefits for the class of people by whom this Fund was accumulated, namely the soldiers and sailors. He has said "If we had left it in, it would only mean a reduction of State contributions." If he can bring in a Bill to take £1,100,000, he could easily produce a Bill by which this money could have been utilised to reduce the amounts to be paid in by the soldiers and sailors of to-day, or have used it to formulate a scheme of additional benefits to the men who come on to the Fund.

I have looked into the Government Actuary's statement, and there is a very heavy incidence of sickness among these men who come on to this Fund. It is obvious because they are not taken by any other society. Although they require additional benefits, they are going to get not even those given by the best societies, but only the general average. And yet these are the men who ought to get something more and who have been paying in for years good money and get post-War money on the exchange when they come out again. Why should there not be additional benefits there? You could easily have made a scheme to give additional benefits to these men so that those who suffer specially from sickness should get it. Why should not that have been done? Whoever has a claim to that Fund, the soldiers and sailors certainly have a better claim to it than the Chancellor of the Exchequer. Even if this will not do, there are other purposes, and purposes which would have been nearer to the hearts of the men who have actually built up this Fund, because we all know why the surpluses really accumulated.

There have been opinions here and there about the cost of administration having been less, but the real reason why this surplus exists is the late War, because the War killed off numbers of people who would have participated in the Fund. After all, I think we might try to get some kind of idea of what those men would have wished. I doubt if many of them would have voted to give this Chancellor of the Exchequer carte blanche for this £1,100,000. I think they would have voted that something should be done for the men who fought in the War. This £1,000,000 might have been used, if the surplus was lying there as a hen roost ready to be robbed, for some purpose for the permanent benefit of the men who come out of the Army and the Navy, such as their settlement on the land at home or overseas. There would have been something there that could have been done. But no! The Chancellor of the Exchequer has obviously been hunting round to see where he could get hold of some temporary financial assistance, and he found here a Fund piled up by the contributions of men who were not in any way organised, of men who come out of the Army, whose voting strength is not known, and who are therefore a very ready prey to the Chancellor of the Exchequer. But does he know of no other cases of funds lying in this country which certainly could just as well have been used as this Fund? It is quite clear why this Fund was selected. It was selected because he thought there would not be very much opposition. I think there will be very strong opposition. It is perfectly useless for the right hon. Gentleman to contend that he is not going to do any harm to those men that would not have been done without the Bill. The Chancellor of the Exchequer could not have touched the Fund unless there had been this Bill. The whole purpose of the Bill is to touch this Fund. We want the soldiers and sailors to touch it, and not the Chancellor of the Exchequer. What he has done here is this: He is bringing in a Bill by which he takes this £1,100,000. and then just to mask it over, he gives a little miserable hit back.

I think those who have said that this is the meanest dodge that even the present Chancellor of the Exchequer has produced are right. It is a most extraordinary example of sheer robbery of potential benefits, benefits of a Fund which ought, under any decent interpretation of the reasons for which the Fund was formed, to have been used for the beneficiaries, and the Chancellor tries to take advantage of a technicality to use that Fund for entirely different purposes, and for purposes which would not have been approved by the contributors to the Fund.

Mr. J. JONES

Now that all the experts have spoken, there may be an opportunity for those of us who are not experts. I have heard the word "robbery" thrown around the Chamber, which is not supposed to be a dignified term in which to describe the exploits of right hon. Gentlemen opposite, because they never like to be associated with Robin Hood or gentlemen of that description. They do their robbery in a more scientific way. In 1911 we had explained to us the kind of paradise we should have an opportunity of entering if we only swallowed this great. scheme of National Insurance. The right hon. Gentleman who explained it was an expert then in explaining things to those who did not know, and now he is an expert in trying to fog us, and he is trying to show that the benefits we expected are not going to materialise. The victims of this particular form of robbery are to be the men who were held up to us as great examples of patriotism fighting for their country. They used to be told "Your King and country need you." That was in 1914. But in 1926 they are told "Your King and country want to bleed you by taking your contributions, either directly or indirectly." I cannot understand the quibbling on this point. The Secretary of State for War has told us that these are not direct contributions by the men, because from 1920 onwards the Government have paid them, and, therefore, they are not contributions made directly by the men themselves. The right hon. Gentleman knows very well that when the pay of the sailors, soldiers, and airmen was taken into consideration, their contributions to the National Health Insurance was taken into consideration at the same time as part of their pay. He knows that as well as we do, yet. he advances arguments of that character.

Now there is a surplus. Who has produced it? is it the Government or the men? The Government are only accidental for the time being, and they were a very bad accident. We have now £1,100,000 at stake, and that money does not belong to the Government. This is an example of the kind of legislation which I, as a Socialist, would like to introduce on the other side of the House. and on such an occasion when hon. and right hon. Gentlemen opposite come forward with arguments against confiscation, I shall be able to use this proposal as a magnificent example of confiscation by a Parliamentary majority, because the Government are now pinching the money of the poor to save the pockets of the rich. Every Clause in this Bill means that—

The CHAIRMAN

We must not discuss the Bill now.

Mr. JONES

I am discussing the bill We have got to pay. Before we have finished with this Clause we shall discover that the workers will have to foot the bill right through, and no other class is being called upon to make the same sacrifices. Part of this money which is going to be taken to meet the Chancellor's necessity is being taken from the widows and the children of the men who died during the War. The various approved societies and friendly societies gave extended benefits to those who qualified before they joined the Army and many of those men were members of their various societies before the War took place. The best of those men who answered the call of the country were members of the old-established friendly societies and approved societies. Part of this money belongs to them, and they paid it into their societies not so much for their own benefit but for the benefit of those who came after them. This money is now being deliberately taken by the Government. I would like any hon. Member opposite to visit East Ham and endeavour to defend the Government policy in this respect. Let them go into any constituency in London or in England generally and attempt to defend the policy advocated in this so-called Economy Measure.

In my own constituency some 44,000 men volunteered to fight for their country, and after paying into their friendly societies they find that the money which ought. to have been devoted to providing them with increased advantages is being taken by the Chancellor of the Exchequer, who says to them, "It is all quite right, wait and see, hope against, hope. We are only putting a little of your money by for the future." The supporters of the Government made much political capital out of a famous Red Letter at the last election, and probably at the next election this will be used as a red herring, and we shall be told that the necessities of the nation demand that the other £300,000 which they have retained will also be required for national purposes, and gradually a much larger inroad will be made on these savings and the workers will have to suffer. This should not be called National Health Insurance but national robbery of the people, who were led to believe that they would benefit by these payments. We are opposing this proposal on behalf of the whole of the workers because the Government seem determined to rob the workers all the time, and this Clause is just as, objectionable to us as any other Clause in the Bill.

Sir R. HUTCHISON

I wish the Secretary of State for War to consider the effect that this proposal is going to have on the men in the Army. After all, the chief people who benefit from this scheme and have been in existence since 1911 are the ex-service men, and it seems to me that this money belongs to those men who have subscribed it, although I know the right hon. Gentleman has stated that the contributions to this Fund have come from the State since 1920. May I point out, however, that although the State has been paying the whole contribution since 1020 it is, in effect, part of the men's pay, and there is no reason why this Fund should not have been used for the benefit of very hardly pressed ex-service men. During the late War these men suffered. very much, and many of them were not able to take any part of this benefit. This only emphasises the fact that those who remain ought to get an additional benefit from the existing Fund. Why should not additional benefit he given to the widows of those men? Under the Widows' Pension Scheme the amount is much too small for the needs of the widows and children of the men who died abroad, who are trying to exist on a very small sum. I cannot help wondering why the Government came forward and proposed such a preposterous scheme by which they rob the men who are the very foundation of the State.

These, contributions have been willingly paid by the men in the past and the effect of this Financial Resolution and this Bill will be to undermine the confidence they have in headquarters. I only need to remind the War Minister of the trouble we had in regard to a much smaller point than this on the Rhine where the men who enlisted should have been paid in sterling but they were paid in marks which were continually depreciating, and they suffered severely in this respect. The same kind of thing is being done now. The men have contributed to this fund and this money is now being taken from them. I entirely fail to see how the men can benefit as suggested by the right hon. Gentleman by the taking of money from this fund. If the £400,000 can be used for the benefit of the men, how much more benefit could you confer on the men if you also had the other £1,100,000? It seems to me very wrong that this fund should be taken in order to help the national Exchequer. This money belongs as much to the men as if they had put it into a savings bank; therefore, it seems to me very wrong to take this money in this way. I hope the right hon. Gentleman, even at this late stage, will think of another way by which money can be got for the national Exchequer.

There is one point which I think has been overlooked, and it is that there are a great many very hard cases of ex-service men who do not come inside any fund, and they are men who owing to bad health have not been able to get the benefit from this Fund which they ought to have received. Surely this money could have been used to alleviate the sufferings of those men. I could give many examples, especially from the North, of men who are not able to exist on what they are receiving to-day. It seems to me very strange that a Conservative Government should be making a proposal of this kind, and I hope that some of my late colleagues in the Army who are now supporters of the Government will get up and protest against the taking of this money, because it really is a thing that the men will not understand. No matter how often the right hon. Gentleman says lie is going to give them additional benefits, the fact remains that under the Resolution you are taking £1,100,000 from this Fund which has been subscribed by these men from 1911 to 1920, and afterwards by the State, and I think the right hon. Gentleman will find it very hard indeed when he tries to justify this action.

5.0 P.M.

Mr. THOMAS

I do not remember the House of Commons ever experiencing what has happened this afternoon. We have in power a Government who got their majority largely on the advocacy of economy, and now when these proposals are being considered hon. and right hon. Gentlemen opposite are silent and impotent, and dare not even open their mouths on this question. I wonder what the constituents of hon. and right hon. Gentlemen opposite will say when they get a true record placed before them of this afternoon's proceedings? We say deliberately to the other side that this is robbery of the worst kind. We go beyond that, and say that, camouflage it as much as you like, if you were here, dealing with it on its merits, you would say the same as we are saying.

Mr. LANSBURY

Worse!

Mr. THOMAS

I would not say worse, because the language that might be employed might be such as I could not understand. We have stated these cold, hard facts, and we are still waiting to see some supporter of the Government have the courage to get up and say something. I can quite understand certain Members who have not a cat's chance of ever coming back not bothering to say anything, but it is really difficult to appreciate the point of view of those who have. Will the Secretary of State for War answer this specific question, which was put to him by my hon. Friend in the first part of his speech? Ah! I thought that would immediately disturb the right hon. Gentleman. Just let us see. The right hon. Gentleman has the document in his hand. If he will turn to Regulation 20—I see he is getting uncomfortable—

The CHAIRMAN

I am certainly comfortable, and I have not the document in my hand.

Mr. THOMAS

I shall be delighted to supply you with this one, Sir. The right hon. Gentleman has it in front of him. and, if he will turn to Regulation 20, he will see that it says: For the purpose of advising the Minister as to the administration of benefits payable out of the Fund, and as to the admission to benefit of seamen, soldiers and airmen under the provisions of paragraph (e).…there shall be constituted an advisory committee, hereinafter called the Advisory Committee, consisting of six members, of whom one shall be appointed by the Minister, one by the Minister of Labour for Northern Ireland, one by the Admiralty, one by the Army Council, one by the Air Council, and one by the Secretary of State for India. The Minister may appoint such person as he thinks fit to be secretary to the Advisory Committee.

Mr. LANSBURY

There is a lot more.

Mr. THOMAS

I am coming to the other part in a moment. That is on page 8. I put it quite clearly to the Committee that that could only mean one thing, namely, that, just as the member of an approved society has the advantage of an executive committee who can advise, who can control, who can supervise, just as the ordinary member of an approved society has someone to look to and say, "This is the responsible body for the administration of our funds"—just as the Minister of Health told us, when we last debated this question, that one morning he called the Advisory Committee together and showed them the draft Bill—this body or ought to be, in precisely the same position—

The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Sir Kingsley Wood)

No!

Mr. THOMAS

The hon. Gentleman says, "No," I will tell him why. The other body was merely called into existence and then ignored. They were called into existence, and one afternoon the Minister hurled the Bill at them and said, "How do you like this? We are going to introduce it this afternoon." I submit that this can only mean that this body is an Advisory Committee on insurance matters affecting soldiers, sailors and airmen.

Sir L. WORTHINGTON-EVANS

That Committee has been set up, and it is consulted for the purpose for which it is set up—namely, to advise the Minister as to the administration of benefits.

Mr. THOMAS

Now we have got it at last. It is set up. Was this Committee consulted in any way about this proposal?

Sir L. WORTHINGTON-EVANS

It has nothing to do with it.

Mr. THOMAS

The Secretary of State says that this Committee has nothing to do with it. I have just, read Regulation No. 20. Let us look at Regulation No. 21, which reads: If any question arises in connection with the administration of the benefits payable out of the Fund or otherwise under this part of this Regulation, that question shall be determined by the Minister after consultation with the Advisory Committee. The mean, narrow interpretation put upon it by the Treasury Bench is that the only people who know anything about the subject, they refuse to consult; they are to be ignored; and these are the people who pose as the friends and champions of the Services! Unlike the approved society member, who will be meeting you in your mass meetings, unlike the ordinary approved society and trade union member, who will turn up and ask you questions about it—

Captain ARTHUR EVANS

We are quite capable of answering them.

Mr. THOMAS

Then you are certainly more proficient there than you are here. If you are as silent there as you are here, the answer will be somewhat in the negative. At all events, the fact remains that you know perfectly well that the people you are dealing with here, the people you are robbing here, are denied by you the right to come and ask you. Was there anything so mean and contemptible? They cannot write to you, they cannot protest, they must not turn up, and you make all these regulations and then, in addition to having gagged them, you say to them, "We will rob you, but we will not allow you to ask us even why we do it." That is the situation.

Captain EVANS

Does the right hon. Gentleman say to the Committee that a serving soldier is prevented by King's Regulations from writing any letters he may desire to write to a prospective political candidate to elucidate his views on certain points?

Mr. THOMAS

I will leave the hon. and gallant Gentleman to discuss that with the Home Secretary, who has been questioned very much on that very point, but the hon. and gallant Gentleman must know, as an acting officer. Can he deny that the ordinary soldier who is affected by this particular Clause is denied the same right of questioning him and agitating on this matter as the ordinary approved society member? I think he admits it. Is that fair? If you admit that it is true, if you admit that it is not fair, surely mere obedience to the party Whip ought not to prevent you from doing something. [Interruption.] That is the best evidence that the consciences of some hon. Members are being touched, after all. If we have succeeded in bringing that home, we shall have done something. I now want to come to the second stage. When we dealt with Part II, the answer of the Treasury Bench to our charge of confiscation was this: "No. This is money that some time hence may be used, but, for a long period at least, no man or woman can be affected." That was the answer with regard to taking the money under Clause 2. When we come to this Clause, the Government set up an entirely new argument. They say: "This really does not belong to these people at all. This is purely a Government surplus which we could have got at in another way."

Sir GERALD STRICKLAND

Hear, hear !

Mr. THOMAS

That may do in Malta, but just let us see exactly how it works out. Here we have this extraordinary state of affairs, and would it not be better if the hon. Member answered it, rather than introducing Malta—

Sir G. STRICKLAND

I am here as Member for Lancaster, and, surely, I may be allowed to make remarks in that capacity.

Mr. THOMAS

I am sure the Committee would welcome the remarks of the hon. Member, and I hope we shall not be disappointed of hearing his views later on. At the moment I was only pointing out that he was not availing himself of the opportunity.

The CHAIRMAN

I would ask the right hon. Gentleman to address himself to me.

Mr. THOMAS

I am sorry, Sir; I was rather led away. I come back now to the question of surplus, and I want the Committee to appreciate exactly what is the agreed statement on the other side, namely, that this money under the one Clause is to provide additional benefits for soldiers and sailors. That is the admitted statement from the other side. In answer to a question which I myself put, as to what are the additional benefits, the Secretary of State said, "We cannot yet say, but we assume they will be the average as between the best and the lowest." I think that that is a fair statement of the ease. just let the Committee observe—because you have to answer the soldiers on this matter—let the Committee observe what that means.

Take my own approved society, which, fortunately, owing to the state of its members' health and to the wonderful administration of myself, is able to provide dental treatment of a substantial kind for its members. But there may be another society, equally well administered, which, owing to bad luck, not only finds itself with no surplus, but with an actual deficit, and, according to the return, there are 10 per cent. of the whole in that position. There are at least another 25 per cent. who do not attempt additional benefit at all. What the Government ought to have done would have been to say, "Here is a surplus, and although, owing to the increased cost of living, we are unable to give the soldier and sailor the equivalent of the benefit that we promised him in 1911"—because let the Committee observe that they are not even getting the equivalent. The right hon. Gentleman has been talking all along about the benefits provided and the benefits promised, but the fact remains that the benefits promised are not materialising to-day because of the increased cost of living and the lower value of money. That is admitted, and surely the Government's obvious duty, in these circumstances, was to say, "Here is a surplus. We are unable to meet the original benefits contemplated, but we have recognised that this surplus belongs in many cases to the poor unfortunate fellows who gave their lives for their country. We want to do the right thing in the spirit and letter of the original intention of the Act."

That is the kind of spirit the Government ought to have shown. Then t hey would have immediately said, "We, being unable to pay you the equivalent. money value of the original benefit promised, will use this £1,500,000 to give the additional benefit to you and you alone." That would have been the way to deal with the surplus. Instead, the Government first take the £1,100,000 out and then turn round and say, "But this is all pure philanthropy on our part. We are giving the people really what they never expected." Of course they did not. They did not expect anything like that from you. We submit that it is not too late for the Government to reconsider the question even now. It is common property that they are uncomfortable. Our object is not to embarrass the Government. We believe we are saving you from yourselves. We believe we are rendering you the greatest possible service by giving you this advice. We warned you in advance what this Chancellor would get you into. We knew that directly he got with you God knows what would happen. For all these reasons we will go into the Lobby against this Resolution, in addition to which we will tell our constituents how you have robbed them, and we will tell them, in addition, what eloquence was poured out on the Government side in defence of this robbery.

Mr. MORRIS

The speech of the Secretary of State for War supplied a good deal of heat but very little light. His argument in defence of his position in transferring this £1,100,000 was that if the Government did not transfer that sum they would lower the contribution and would re-absorb the £1,100,000 over a period of years, and, as I understand it, would re-absorb it without any further statutory powers at all. It appears from Section 57 of the Act that the amount of the contribution paid by the Government is fixed by statute. But even if the right hon. Gentleman's contention were a true one that, apart from any further statutory authority, all the Government would require to do would be to reassure the amount by reducing their contribution, what is the position? This is a Fund which has been accumulated by the contributions of different classes of people, a Fund which is not a Government fund in any sense of the word. It is not a fund accumulated by the Government; it is not a fund over which they have any control, and if they re-absorbed it without any further statutory power, they would be quite as much guilty of robbery as if they transferred it for another purpose. The right hon. Gentleman's defence is not only, as has been described over and over again, a shabby defence from beginning to end; it is a defence that cannot stand any test. He is taking over a Fund which has been accumulated by the savings of one set of people who will not benefit and will have no voice at all in the determination of the transfer and over the money which they have saved in any form. I was not surprised to hear the hon. Member for Silvertown (Mr. J. Jones) say this was the best justification a Socialist Government could have for raiding other funds. It is a, clear precedent and it is levelled against a class of people who cannot complain under the Regulations. Money is taken from people who must perforce remain mute and who cannot protest and put their point of view to the Government. It is one of the shabbiest and meanest acts which have, unfortunately, been made necessary by the rampant waste of the prodigal son whom they placed at the head of the Treasury.

Mr. MONTAGUE

An hon. Member below the Gangway said a little while ago that he would like to hear what the ex-service men themselves would have to say about this proposal to support the position of the Chancellor of the Exchequer by a raid upon these funds which belong to the ex-service man. I am one of those ex-service men who paid that 1½d week, and while listening to the Minister's speech I wondered what would have been said by the Tommy who fought in the trenches, as I did, if he had been able to get on to Mr. Well's "Time Machine" and listen to this Debate, and especially to the right hon. Gentleman's speech. I know the kind of language that would have been used anyhow, and it would be language that transcends what it is possible to use in the House. The right hon. Gentleman says the money in this Fund does not belong to the soldier, sailor, or airman at all but is money which has been contributed by the Government, and if it was mot taken now it. would be re absorbed by reduced contributions, and he justified that statement by saying chat it could he re-absorbed because the Treasury are only called upon to keep the Fund solvent. The majority of people who read Reports of Debates of this character are laymen so far as intricate details of this kind are concerned. If that is a valid argument, and the Government have only been compelled all the time to keep this Fund solvent, how is it that there is a surplus at all? Surely the fact of the surplus proves our contention that the money really belongs to the service man and should not be raided on behalf of the Treasury.

When I came to the House to-day, after having been in my constituency for a day or two hearing various complaints about pensions and other things, I came with a sheaf of documents that I wished to. deal with to-day, and quite 50 per cent. of these were cases of ex-service men who cannot come under the ordinary approved society benefit, who have run out of any benefit they have in the form of pension or in the form of payment by the State for their disability, men who are to-day, in spite of the heroic deeds some of them I know did in the trenches, dependent upon the Poor Law. Now we are told, although that money is there to be raided, the Committee is only prepared to take about an average of benefit between the lowest status of society and the highest. It would be more than an act of grace, it would be an act of simple justice if instead of taking just an average of benefit they should at least take the highest standard of the approved society and use this money in order to finance it. That would justify the things that were said to the soldiers when they were in the trenches and things that have been said of recent years since I have been a Member of the House. The party opposite claim to be particularly upon the side of the service man. They claim to be more patriotic than we are, more concerned about the interests and the defence of the country, Some time ago a man was sent to prison for distributing leaflets to soldiers at Aldershot advising sedition. I should advise that man, if be wants to do anything of the kind again, in order to sow sedition, if it is sedition, amongst the troops, to prepare another pamphlet telling them the truth about this mean business.

Mr. STEPHEN

I wish to join in the protest against the action of the Government. I congratulate the Secretary of State on the discipline he has imposed upon the forces behind him. I am very doubtful whether, when the people he is responsible for in the Army get to know about his action to-day, it will conduce to discipline in the Army itself. It seems to me the Government is taking up a very extraordinary position. There is this sum of money here, and the Government, because it has a difficult case in various other connections, though it has no real claim to the money at all, decides to take it. I notice that the Fund was established to receive contributions paid in respect of seamen, marines, soldiers and airmen who were not members of approved societies during service, and to provide ordinary benefits for such men as find themselves unable on discharge to obtain admission to approved societies on account of the state of their health. There is no suggestion that there was also a residuary legatee who was going to be in the position of taking over anything else in connection with this Fund after these ordinary benefits had been supplied. The Actuary points out that the estimated surplus of the Fund is £1,424,000. Accumulating this sum with interest to 31st March, 1926, it reaches approximately £1,500,000. He says this surplus arises from a variety of causes, of which the following are the more important. The first cause attributed in respect of the surplus is: The rate of interest earned by the Fund has been substantially in excess of that assumed (namely: three per cent.) in the basis of the contributions and reserve values. Further the surplus during its growth has earned a large amount of interest. When we consider the first reason given, there is nothing to suggest that the Chancellor of the Exchequer should have a claim upon this surplus. I would like the Secretary of State for War or the Parliamentary Secretary to the Ministry of Health, if he has to take over this baby of the Secretary of State for War, to explain to us the exact connection there is between the Chancellor of the Exchequer and this surplus. The second reason for the surplus, given by the Actuary, is: The cost of administration, in the case of serving men, has been much below the sum provided in the contributions. Again, I would like the Secretary of State for War or the Parliamentary Secretary to the Ministry of Health to explain the connection between that reason and the Chancellor of the Exchequer, and why this money should go to the Exchequer. The third reason is: The contributions; contain la margin which in the case of approved societies is carried to their contingencies funds, but which in the present case has accrued directly to the principal fund. There is a reference here to the method adopted in connection with the approved societies. Again, the Chancellor of the Exchequer and the activities of the Chancellor of the Exchequer have no connection whatsoever with this surplus that has accrued. When we come to the fourth reason for the surplus, we find it stated that: The reserves released in respect of men who were killed during the War or who died as the result of wounds or disease due to the War, have been specially heavy in the case of this Fund, nearly the whole of the contributors to which were serving with the Forces in the War. If this Committee agrees to this proposal, in view of that one statement as a reason for this surplus, it will take a very invidious step, and a step which no Member of the Committee could go on to any platform and defend. I would like to put it to the representative of the Government that here is an opportunity in connection with this surplus to provide for the people for whom the Fund was meant. It is no doubt true that what was conceived of were the ordinary benefits, but owing to the reasons given the Fund has come into its present position. Instead of the Chancellor of the Exchequer taking this money, and possibly using it in some way for the reduction of Income Tax, it is the plain business of the Government to see that the benefits in connection with the Fund accrue to the members of the Services.

I have in hand the case of an individual who would have a claim upon this Fund. He has a bigger claim on the War Office than the War Office has been willing to admit. The man served in the Army, and while in the Army he contracted tuberculosis. After spending many months in hospital he was discharged from the Army, and the Secretary of State for War has told me that he cannot get a pension, because they cannot say that there was a certain stormy night when there was a special shower of rain and wind which was responsible for this man contracting tuberculosis. He says that the disease was possibly constitutional. Any medical authorities, which I have heard regarding this constitutional weakness, take the line that if the environment has been proper and suitable, the individual will not become a victim to tuberculosis. The War Office has nothing to offer this man with regard to pension, and when the man might claim something in the way of additional benefit from this Fund in the state of health in which he finds himself, we are told to-day by the Secretary of State for War that he might get some little additional benefit up to the average, but not over the average.

The Government's position amounts to this: do not do anything specially to help these men who have been the victims of the military machine; do not do anything to give them a little comfort in the circumstances in which they are placed. It means that we must not hope for anything above the average of the benefits in connection with the approved societies. If the Fund could not stand it, one might he inclined to say: "We are sorry, but the provisions that have been made are not able to sustain more than a certain amount of claim." Here is the money to meet the claim, and instead of these people getting it the money is to be spent by the Chancellor of the Exchequer in some other fashion, giving some relief to the rich, to defend whom these men have offered their bodies. The Secretary of State for War, instead of defending these men, and instead of regarding the interests of the men in the Army as the big interest entrusted to him, is so anxious not to get in the way of the Chancellor of the Exchequer, so anxious not to offend the right hon. Member, that he disregards altogether the possibilities of providing additional benefits for wounded soldiers, for the men who have lost their health in the service of the country.

This is a most preposterous proposal that is now made to us. Possibly it is what we might have expected. The Secretary of State for War and the well-disciplined army behind him in this House are careless with regard to the conditions of the men who have served their purpose in the Forces. I put to the Secretary of State for War, when the Army Estimates were before us, the condition of the man to whom I have referred. He could not do anything for him. Here to-day the right hon. Gentleman and the Chancellor of the Exchequer, and this Government of rich men, are going to take from this victim of tuberculosis, contracted while he was in the Army, the additional benefit he might have obtained out of this Fund. It was possible for the Secretary of State for War in connection with the Advisory Committee in administering this Fund to take into consideration the cases I have mentioned, and if he did so there would be no one to find fault with him. The other soldiers who had contributed to the Fund, and also the men in the Navy and in the Air Force who had contributed would not have complained if some of their fellows had been assisted in the way I suggest. It is obvious that they will make complaint if millionaires are to obtain this money that has been taken out of the pockets of the ordinary members of the Services.

This surplus having accrued, it is within the power of the Secretary of State for War to bring a gleam of hope into the lives of these people and to bring them a little special comfort, and I hope that hon. Members opposite will let their Government know that although they are prepared to stand a good deal from them in the way of canting humbug in their treatment of the ordinary people of this country, they are not prepared—

The CHAIRMAN

In the use of the words "canting humbug" the hon. Gentleman is going beyond Parliamentary usage.

Lieut.-Colonel WATTS-MORGAN

What does the man in the street say about it?

Mr. STEPHEN

If it is not canting humbug on the part of this Government, I am willing to use some other expression, and I would say that it is simply a case of robbery on the part of the Government. One of my hon. Friends suggests that a rose by another name would smell as sweet. This policy of the Government will not smell sweet in the nostrils of any decent, respectable people. I would like to put a question to the Secretary of State for War if he would waken up for a minute. I know it has been a strain on him to defend a policy like this, and he may be exhausted in. consequence. Is he not prepared to meet the criticism that has been made to-day? Is he not prepared to meet us in regard to the benefits that will be given, and to say that the benefits will be as high as in the very best approved societies, rather than the "average." Is he going to give us any concession? It may be all very well for the Government now, with their big majority, and with their assurance that everything is going to go well for them, but if an industrial crisis takes place, they may be very glad of the services of the Army at no distant date. An Army that is going to be treated in this fashion by them will be, to my mind, an Army more likely to act in accordance with what I would like than in accordance with what the Secretary of State for War would hope for.

There is no doubt, every hon. Member in this House knows it, the Secretary of State for War knows it, and the Chancellor of the Exchequer knows it, that these men have a rightful claim to the surplus. The Chancellor of the Exchequer is not here because he would not like to hear the criticisms which have been made of this proposal. He must be ashamed of the proposal, and he has got his weaker brother, the Secretary of State for War, to undertake the job for him, possibly because he thinks that, as the right hon. Gentleman has the Army behind him, he will be the better able to defend a proposal such as this. It is a mean proposal to take from the soldiers and from the sailors and the airmen who have become the victims of disease the benefits that they might have got under this scheme.

Why should the Chancellor of the Exchequer get this £1,100,000? Why should it go into the Exchequer? Why should it not go to the people for whom it was intended Some of us have asked the Chancellor of the Exchequer questions in regard to the way in which the National Debt might be dealt with. He raises his hands in pious horror at the suggestion of interfering in any way with people who have investments in the National Debt. That is a sacred contractual obligation, and it is a terrible thing to break a sacred obligation which has been made with a rich person, a millionaire, but it is no great crime in the mind of a Conservative Government when the contractual obligation has been made' with "Tommy Atkins." The Government are prepared to rob Tommy Atkins, and the sailor and the airman too, quite convinced that they can get off with it. There is military discipline and the Army Act which will allow them to deal with anyone who gets a little obstreperous.

Every Member of the Government should be ashamed of these proposals, and I am surprised that more Members opposite, who do know something about financial obligations, Members like the hon. Member for Ilford (Sir F. Wise), should allow these preposterous proposals to pass without some criticism. I appeal to them in the interests of these victims of disease to join us in the protest we are making. The Government may appear strong, but a little action from some Members who sit on the Back benches opposite would do good to those men in the Air Force, to men in the Army and in the Navy, who are now lying on beds of sickness, the victims of disease contracted during their service with the Forces of the Crown. They would be very thankful for the benefits which any decent Government would give them from funds that have accumulated in this way. I hope the Secretary of State for War, if the sleeper is now awake, will tell us that he is going to reconsider this matter in the interests of the people for whom the money was intended.

Sir J. SIMON

I presume we shall have some reply from the Government to the points that have been raised, but the Secretary of State for War will allow me to put briefly what can be very seriously urged about this Clause without using the highly rhetorical language which opponents of it are naturally tempted to use. I have not the slightest desire to use words like "robbery." I remind myself of the famous conversation between Falstaff and Bardolph when Falstaff complains of Bardolph's open thieving and ancient Pistol observes: Convey, the wise it call: Steal ! foh; a fico for the phrase. I do not mind whether you call it a transference from the Fund to new purposes or whether you call it robbing the Fund. The thing which Members of the Committee are anxious about is whether or not, looking at it fairly and squarely, it is doing right by the people concerned. I do not for one moment believe that Members opposite are any less concerned to see that what is right is done in this matter than any of the rest of us, but their silence in this Debate shows that they have extremely uncomfortable qualms, and the circumstance that no single supporter of the Government can support this proposal is a strong practical reason for thinking that something quite indefensible is being done. May I, with great respect, point out how this matter strikes anyone who has studied the actual provisions of the law. I concede the Secretary of State for War this point; he is perfectly entitled to take it and use it for what it is worth. He is quite right in saying that by the exact terms of the Section the benefits which were contemplated from the Fund were minimum benefits as distinguished from additional benefits. But I do not believe that in the realm of common-sense or in the view of any court of equity his argument based on that would hold water for one moment.

No one knows better than the Attorney-General, who I see is sitting with the Secretary of State for War, that if a fund is really held in trust for the purpose of providing benefits A, B, and C, and there is more money in the fund than is necessary for these benefits, any court of equity, assisted by the Attorney-General, would proceed to say that the fund must be used for the nearest approximate purposes consistent with the general scheme of the trust. That is perfectly familiar to the Secretary of State for War and to the Attorney-General, and it is not a mere technical point. It is a substantial point. The real point is that the money which has been put into this Fund is money which beyond all question was put there for the purpose of providing benefits for the class of person on whose behalf it was subscribed. To say it was put there for the purpose of preventing there being an addition to the Income Tax or of being used for the general needs of the country is to talk palpable nonsense. The Secretary of State for War is the last person who can say so. He, himself, put before the Royal Commission on National Health Insurance a memorandum of his own which is referred to on page 225 of the Report, where the Commissioners say: We have received a statement from the Secretary of State for War on behalf of the three Service Departments submitting two suggestions for improving the position of men discharged from the Forces as regards title to additional benefits. The Report gives the reference and says that the statement is to be found in the appendices. I went to the Library in order to see whether these appendices were available and the Librarian gave me a copy. I find the statement under the heading: Statement submitted by the War Office as to additional benefits for members of the Navy, Army and Air Force Insurance Fund. The statement is a little too long to read in full, but the result is perfectly plain, that at the time the Secretary of State for War was framing his statement and putting it before the Commission it never entered his head that this Fund was available for general purposes. The whole memorandum deals with it on this basis, that it is a fund which has been put up on behalf of these men, and it says: Some doubt appears to have been felt in 1911 as to the ability of the Fund to meet these liabilities, and the obligation to maintain its solvency was accordingly placed upon the Service Departments. Presumably in view of this condition it was decided that members of the Fund should not be entitled to additional benefits. The Government actuary has advised that the resources of the Fund are adequate to provide for the cost of these concessions. My point is that as Secretary of State for War he brought this document to the, attention of the Commissioners of National Health Insurance, because he felt that this Fund, subscribed for by men for whom he is particularly responsible, was a Fund which was available for an extended use on their 'behalf, and I do not find one single word in his memorandum in which he suggests that this money can be taken for any other purpose. On the contrary it is plain, if you read the memorandum, that he is dealing with this Fund, as any plain man would deal with it, as a Fund constituted by a series of contributions by a particular class of persons.

Mr. HERBERT WILLIAMS

Why "class"?

Sir J. SIMON

Because every single contribution is paid in respect of a person who is a soldier, a sailor, or an airman—nobody else at all—and there is a special Section of the Act under which these contributions are made. The real position is that having provided out of the Fund for those men who are able to join an approved society there remain a number of people who are particularly interested; and let the Committee consider who they are. They are men who because of their war service or any other misfortune happening after their war service are so unfit and below the standard of normal health that no approved society will take them. Let hon. Members appreciate that fact. These are the people who have a special interest in this Fund. They are the people who cannot join an approved society. Many of them are people who have tried to get a pension, but who have been told that, while it is true they are suffering very much now, they have not succeeded in showing that their suffering is due to their war service. And they may not succeed. If there are any people in England who are entitled to the full consideration of this Committee it is these men. [An HON. MEMBER "What about the Fund?"] The Act of Parliament provides in terms that a soldier or sailor should pay his 11d. a week and that the State should pay another 11d. Later on a readjustment was made by which the State paid a rather larger amount, but the Secretary of State for War does not suggest that that makes any real difference.

The real truth is that this Fund has been provided on behalf of, in the interests of, and, in effect, at the expense of, these Services. You may say, and it is true, that the great mass of people who have contributed to this Army, Navy and Air Force Fund are not all of them going to benefit by it. That is true. Millions of them have passed away already.

6.0 P.M.

But if you were to put to any one of these men, when they were made to contribute, whether they thought they were contributing to a Fund which the State could take for its own purposes, or whether they thought they were contributing to a Fund which was earmarked for the general purpose of benefits for soldiers and sailors and airmen, there cannot be the slightest doubt as to what the answer would be. That is the real point. It is not a technical point.; it is a very broad point of substance, as to which I am certain that hon. and gallant Gentlemen opposite are just as uncomfortable as I am. It seems to me to be a very sad thing if at this stage, when the Chancellor of the Exchequer is in an emergency, we should say: "Now here is this Fund which was built specifically for the purpose of providing benefits for this class of person. Well, to such and such an extent, to the extent of £1,100,000, it shall be diverted and used for quite a different purpose." I spoke of these men as a class. As to that there is not only the language used in 1911, but the language which was used as lately as 1924 in order to describe this very Fund. If the question is, what is the Fund for, to what general purpose is it directed? Here it is as voted by the House of Commons in 1924: For the purpose of providing seamen, marines, soldiers and airmen with such benefits during their term of service and after their return to civil life as are hereinafter mentioned. It is no good hon. Members telling me to read on, and that the Section speaks only of normal benefits. The Secretary of State for War is the very last person who should use that argument. Here are his own words in his own Memorandum:— Presumably in view of the fear of the Fund not being enough, it was decided that members of the Fund should not be entitled to additional benefits. Then the right hon. Gentleman goes on, on behalf of soldiers and sailors to urge that the Fund ought to be extended to analogous purposes. Without attempting to use words like "robbery" and "cheating" and "thieving," or anything of the kind, I say that we are in a position which a great many of us may hereafter most bitterly regret. Does anyone believe that the Secretary of State for War would come here and do this if it were not that his colleague, the Chancellor of the Exchequer, is pressed to find £1,000,000? If the Chancellor of the Exchequer had tried to lay his fingers on this Fund at a time when there was a surplus, would the Secretary of State for War not have fought to keep every penny of it for the people whom he represents? Of course he would.

After the War I served for two or three years as one of the trustees of that great corporation which endeavours to administer all sorts of funds connected with the Army, Navy and Air Force, the precise original purpose of which has been exhausted. Hon. Members will know that there were many such. There were funds raised for a particular regiment or a particular corps. or funds for people in a particular place, and it was not possible any longer to use those funds exactly according to the terms of the original trust. What did we do? Of the trustees, Sir William Plender was one, a distinguished general was another, and my unworthy self was a third. Did we say, "Here is a lump of money which cannot be used for the exact purpose for which it was originally intended, and we will hand it over to the Treasury?" Not at all. We saw that the money was devoted to objects which were analogous to the objects originally intended and which would help the same kind of people or the same class of people. in order that-the real spirit of the original scheme should be applied.

Exactly the same thing ought to be done here. There is no man of business, no competent lawyer who, if he were presented with the facts about this Fund, would tell you that because you have already provided for these original benefits, therefore the balance goes to reduce taxation, or to pay for some utterly different purpose. That is contrary to common sense and the plainest dictates of equity. It is contrary to what the Secretary of State for War himself would have been the very first to insist upon if it had not been that we were living in an astonishing world in which the Chancellor of the Exchequer has this Economy Bill with three main things in it, one of which he leaves the Minister of Health to defend, because it involves a raid on the approved societies; the second which he leaves to the Secretary of State for War to defend, because it is an attack upon this Fund; and the third of which, I suppose, is to be defended by the Noble Lord the President of the Board of Education. This is indeed putting the Treasury into commission. The one person who is never here is the person who has caused all this disturbance, all this quaking inside amongst Members opposite—[Laughter.] Hon. Members laugh, but they will laugh the other side of their mouths when they meet a soldier or a sailor.

It is entirely because all the cheerful boastings as to what could be done by the Chancellor of the Exchequer have come to naught that you have one after another of his colleagues turning up here with an embarrassed smile endeavouring to find some justification for this or that or the other raid, when the real truth about it is that no one would ever think of using a penny of this money for any purpose, except the purpose of benefiting soldiers and sailors and airmen, if it were not for the difficulties, the embarrassments, and the anxieties of the Chancellor of the Exchequer. I make these remarks because I hope we may hear what the answer is. I have listened to every word of the Debate, to both of the speeches of the Secretary of State for War, and I am sincerely anxious to know whether any of my propositions are denied. I will sum them up briefly.

Is it denied that this money may fairly be regarded as money provided by soldiers, sailors and airmen, notwithstanding that in fact it is paid out of the Army or Navy Vote? It cannot be denied, for the Secretary of State for War admitted it an hour ago. Is it denied that the reason why the statutory purpose for which this Fund was to be devoted was restricted to the normal benefits, was because of anxieties lest the Fund should not be able to stand a more extensive drain upon it? It cannot be denied, because it is admitted by the Secretary of State for War in the Memorandum which I have just read. Is it denied, in common sense or in a Court of equity, that if you have money which has been collected for some purpose that is narrowly defined, and you find that there is more than can be used for that purpose, the proper use to which to put the money is an analagous purpose? No one can deny that. It follows necessarily, whatever language you choose to use, that this is in fact the taking away of a fund, which has arisen in circumstances which we thoroughly understand, from objects which would certainly be the objects that the Secretary for War would be anxious to promote if, indeed, he was not pressed and embarrased by his colleague. In these circumstances it matters very little whether hon. Gentlemen opposite take part in the Debate or not. Everyone may draw his own conclusions from their silence. The reason why they take no part in the Debate is either that they have had orders not to do so, or that there is not one of them who can think of a single word in defence of this Clause.

Sir L. WORTHINGTON-EVANS

I am very sorry to inflict on the Committee another speech, and I propose to confine myself to the one point of the right hon. and learned Gentleman with regard to the Memorandum which I put before the Insurance Commission. I will not argue on the legal point, for I am not competent to do so. But I understood in the old days, that when There was a general charitable intention and a fund was excessive, you might try to find another charitable use as near as possible to the original charitable use; but on the contrary, when there is not a general charitable intention, there is a resulting trust in favour of the donor. In this case it was much more appropriate that there should be a resulting trust in favour of the donor. I will pass from the general to the particular charge that the right hon. and learned Gentleman made.

Sir J. SIMON

I am not anxious to embarrass the right hon. Gentleman. Who, in his view, is the donor?

Sir L. WORTHINGTON-EVANS

Again I do not want to recur to the speeches I have already made, but will in two sentences express my view, because I do not want to appear to run away from the challenge. The original Clause provided that 1½d. should be taken from the serving soldier, and that the Government should make up the whole of the balance, whatever it was to be. No one could tell what the real weekly contributions ought to be. More were paid in than were necessary for the purpose. A surplus of £1,500,000 has resulted, because the Government of the day has continued to pay into that Fund more than was required. That is a fact.

Sir J. SIMON

I beg the right hon. Gentleman's pardon for interrupting. Surely be has unintentionally conveyed a wrong impression. He has conveyed the impression that the amount contributed by the Government was an amount which they contributed, within their own judgment. The original Act provided that the Government should pay 1½d., and the Act of 1924 contains the exact number of pence and halfpence that the Government should contribute.

Sir L. WORTHINGTON-EVANS

Generally the right hon. and learned Gentleman is accurate. On this occasion he is not accurate. I would draw attention to Section 59, Sub-section (1, b), of the Act of 1924, which re-enacted the original Act of 1911. It says: The weekly contributions to he made by the Admiralty, Army Council and Air Council in respect of men of the Forces shall be such as may from time to time be required to keep the Fund solvent. What they did, in fact, do was to pay in weekly contributions in excess of the sum that was required to keep the Fund solvent.

Sir J. SIMON

I am perfectly right, and no one knows that better than the right hon. Gentleman. Will he kindly look at Section 57, which says: For the purpose of providing seamen, marines, soldiers and airmen with such benefits during their term of service and after their return to civil life, as are hereinafter mentioned, there shall be paid to the Minister by the Admiralty, Army Council, and Air Council respectively, out of the moneys provided by Parliament.…in respect of every seaman and marine, and of every soldier of the regular Forces…and of every member of the regular Air Force, if such seaman, marine, soldier or airman is a member of an approved society, a sum of fourpence halfpenny, etc., etc. The provision which the right hon. Gentleman quoted from Section 59 is the provision which secures that if that contribution was not enough the Department guarantees the solvency of the fund. I can be corrected if I am wrong. Both in the 1911 and 1924 Acts there was a defined amount which was to be paid in respect of each man week by week, and the other provision is a provision to cover the possible case of the fund requiring further money to keep it solvent.

Sir L. WORTHINGTON-EVANS

I do not want to be drawn into a detailed argument.. [HON. MEMBERS: "Why not?"] The sum paid in was more than sufficient for the purpose.

Sir J. SIMON

Then I am right.

Sir L. WORTHINGTON-EVANS

The right hon. and learned Gentleman is right in saying that 4½d. was the fixed sum which Parliament said was to he paid in, but I am equally right in saying that that sum is in excess of the amount which was required for the purpose. Now let me deal with the point which the right hon. and learned Gentleman made regarding the memorandum submitted by me to the Royal Commission. This Fund had, in my judgment, a surplus, and I wanted the removal of the limitation originally in the Act, which restricted the benefits payable to ordinary benefits. I wanted to give to the soldier, the sailor or the airman who was in this Fund, something additional, and I put a memorandum before the Royal Commission—who were all experts —in order that they might consider whether the proposal I made was fair or not. The right hon. and learned Gentleman quoted from the Report of the Royal Commission, but he did not quote enough. The Royal Commission referred to two suggestions which I made. One was that there should be additional benefits, equivalent to the average of those provided by the Approved Societies. The second was that men on discharge from the Forces should not be subject to a waiting period, but should get full benefit in the Approved Societies the moment they left the Services. Those were my two proposals and the Royal Commission accepted them. On the top of the following page of the Report will be found the words: and we therefore recommend that statutory provision be made accordingly. They recommended that these proposals should be made statutory provisions and the Measure to be based on the Financial Resolutions which we are now discussing, will make them statutory provisions, exactly in accordance with the advice of the Royal Commission.

Mr. WHEATLEY

I was not greatly surprised when an hon. Member below the Gangway and my lion. Friend the Member for Camlachie (Mr. Stephen) were rebuked by the Chairman for having used strong language regarding this miserable proposal. When one, in a discussion such as this and in the atmosphere which surrounds it, remembers the appeals, the promises and the pledges made to service men or to those who were being invited to become service men, in times of national need, it is difficult not to blush for human-kind and particularly for that section of human-kind known as politicians. The right hon. Gentleman in the first of his three speeches referred to pledge that the benefits to be derived by the service men out of the remnants of this fund, will not be less than the additional benefits which accrue to a member of an approved society. When pressed to state whether he referred to the best societies or to the others, he carefully avoided the point. I am not so much interested in his evasion of that point, as in the cheek which he displays in the plea he puts forward. When he tells us they are to receive benefits equivalent to the additional benefits paid by the approved societies, he invites us to forget that in this very Economy Bill are provisions which are bound to reduce the additional benefits of those approved societies. He lowers by one section of his Measure the standard of additional benefits, and he claims for the other section of his Measure that nothing in it will prevent recipients from obtaining from the service fund, what they could obtain from the approved societies.

Most of the right hon. Gentleman's other arguments seem to be equally lacking in logic. He was pressed to say why the Fund was being raided at all. Is the Fund being raided because it is unnecessary for the purposes for which it has been created? The Parliamentary Secretary to the Ministry of Health appears to say "Yes." I accept the view that if the Chancellor of the Exchequer this year had at his disposal the £42,000,000 which he distributed last year, he would not come to the House of Commons and ask permission to raid this Fund. I submit that the proposals now before us would never have arisen but for the battered political fortunes of the Chancellor of the Exchequer Twelve months ago, the right hon. Gentleman inherited a much better financial position than the country now enjoys, and he inherited it as a result of the careful and economical administration of my right hon. Friend the Member for Colne Valley (Mr. Snowden). The right hon. Gentleman the Chancellor of the Exchequer then found himself with £42,000,000 10 play with, but he never thought of devoting any portion of that money to additional benefits for ex-service men or any other service men. He distributed that £42,000,000 among his friends of the middle and upper classes. Now he is the heir to his own blunder. Now he is faced, not with a £42,000,000 surplus, but with a situation in which be finds it difficult to make ends meet. If one did not know the Chancellor of the Exchequer and the history of the party opposite, one might expect him to seek his £1,000,000 this year, where he placed his £42,000,000 last year. But the Chancellor of the Exchequer does nothing of the kind. He gives £42,000,000 to the rich; he comes for his £1,000,000 to the poor. I submit to the Parliamentary Secretary that his Department would never have acquiesced, any more than the Department represented by the right hon. Gentleman who has submitted this proposal, in the demand of the Chancellor of the Exchequer if that demand had been made in a year of prosperity instead of a year of adversity.

May I remind the Parliamentary Secretary that there were other sources from which the Chancellor of the Exchequer might have been invited by the Parliamentary Secretary's own Department to find this money? The Chancellor of the Exchequer has conspicuously failed in obtaining from the French Government money which is admittedly due by that Government to this country. If the right hon. Gentleman had not failed in his duty in his dealings with France, he would not be accused to-day of robbing a fund created for the betterment of the ex-service men of this country. The Minister of Health is the trustee and the guardian of the Fund which we are now discussing. The Ministry of Health ought to have stood up to the Chancellor of the Exchequer when the right hon. Gentleman proposed to raid this Fund. The Parliamentary Secretary to the Ministry is here as the watchdog of the interests of this section of the insured people. The watchdog has not even favoured us with a bark. He has smiled, and wagged his tail, and licked the hand of the invader. He has allowed the people for whose welfare he is responsible to be plundered in the interests of the super-taxpayers of this country. I submit that if the attitude adopted by Briand towards the Chancellor of the Exchequer had been adopted by the. Minister of Health, these provisions would never have been brought before the House of Commons. May I put it to the representative of the Ministry of Health, that it is not a burden on the taxpayers of this country to have to provide out of public funds additional benefits under the National Health Insurance Scheme May I put it to the hon. Gentleman that the prevention of disease which accrues from the administration of National Health Insurance, has probably saved this country more millions. than have been contributed by the taxpayers into the National Health Insurance Fund? May I also remind him that the authors of the National Health Insurance policy, and the enthusiasts who have supported it through thick um] thin from its inception, have had as their goal a disease-free nation, and that the surpluses existing to-day are the. results of a partial realisation of their dream. May I submit to him that it is the soundest national policy, even from a financial point of view, to put in the hands of the poorest section of the. people of this country the means of protecting their health.

The DEPUTY-CHAIRMAN (Captain FitzRoy)

I hope the right hon. Gentleman will confine himself to the subject-matter of the particular Resolutions which we are discussing.

Mr. WHEATLEY

I think I will have no difficulty in convincing you, Sir, of the relevancy of my arguments. My argument is that instead of this £1,000,000 being taken from benefits and applied, probably to battleships, it ought to have been devoted to additional and further additional benefits to the people for whom it was intended; that if it were applied in that way, which I submit to be the proper way, it would go some length towards giving us a healthier population; that a, healthier population is an insurance to the taxpayers and ratepayers of the country; that if one could estimate in bard cash what is lost in taxes and rates, in industrial efficiency, in lost time through bad health, one would recognise what an idiotic economy it is to raid a Fund which has as its main and, indeed, its only object, the betterment of the health of the people. I am submitting that what is called economy here is the very worst form of extravagance. Here is a Government, that has been appealed to from all quarters of the country to practice economy, and the very first step which they take in their policy of economy is to raid the Funds that have largely accrued from the economies of other people.

I put it to the representative of the Ministry of Health, particularly, that we are here face to face with a very serious situation. If it can be said and maintained on the part of the Government that they are entitled to raid this Fund because their contributions to it have not been necessary for the standard of benefits that obtain at the moment, then they can justify the raiding of every Fund in connection with National Health Insurance. It is a retrograde step. The proper policy is to extend your benefits, to give to every section of the community—and to begin with this section of the community where you have the money with which to do it—the means of protecting themselves against the diseases of life. If the Ministry of Health adopted and pursued that policy, then the aim of the health enthusiasts of this country, of obliterating disease from the path of our people, would be nearer realisation, and the prosperity of this country would be greater and better ensured than it will be by handing over to an extravagant Chancellor of the Exchequer money that was meant for the purposes of public health.

I do not know whether any good is to be derived from appealing to the Government, even at this stage, not to press for this money, but I am quite satisfied that, if the case for its retention for its original purpose had been presented to the Government before the proposal got to its present length, we would not be to-day in the disgraceful position of robbing the small funds that were created for the benefit of a very useful and a very worthy section, at any rate from the point of view of the party opposite, in order to save from further taxation people who could bear quite easily and without suffering the burden of taxation that they endured before the Chancellor of the Exchequer introduced his Budget last year.

Mr. H. WILLIAMS

Not being an experienced lawyer, I shall not spend a great time in putting forward the very few points that I have to make. When the right hon. and learned Member for Spen Valley (Sir J. Simon) was speaking, he used the word "class," and I interrupted to challenge the use of that. word, because think it is a misleading use in this connection. It may be that the word "class" is being constantly used in this Debate because of its propaganda effect outside. The Fund we are considering is a Fund which was contributed to by probably nine millions of persons. The right hon. and learned Gentleman was rather surprised when I interrupted with that figure, but it should be borne in mind that every one who passed through the ranks of all the forces during the War was for the time being an insured person, that many of them were not insured before they joined up, and ceased to be insured persons after, and that the persons who contributed to this Fund and who built it up are to-day the general body of the adult civilisation of the country, and if anyone is entitled to it, they are entitled to it. There is no effective means of distributing it among those who, by their contributions, have built it up, so far as it is built up out of the contributions of the serving soldier, airman, and seaman, and the fairest way in which those who contributed it can get it back, so far as it is surplus to requirements, is through a relief to the general burden of taxation. The burden of taxation is far too heavy, but every project for economy is bitterly opposed by some interested section or another, or is opposed on grounds of general party politics.

The challenge has been thrown out as to why no one on our side of the House has taken part in the Debate. The reason is perfectly clear. On occasions when Debates have been continued at unnecessarily great length, the bulk of Members on my side of the House—I am occasionally an exception—have the discretion not to intervene, and it is never necessary for us to be instructed, as the right hon. and learned Gentleman seemed to suggest, not to speak. We are quite prepared to give loyal support to our own side by speaking when speaking is helpful, and by silence when silence is more helpful than speech.

Major Sir ARCHIBALD SINCLAIR

I cannot help thinking that probably the right hon. Gentleman who sits on the Government bench will feel that perhaps it was a mistake of the hon. Member for Reading (Mr. H. Williams), who has just sat down, to break the rule of not speaking in the belief that this was an occasion on which his speech might be useful. His ingenious argument that it would be to the advantage of the nine million contributors that this sum of £1,100,000 should be taken and devoted to the general purpose of the relief of the taxpayer, is hardly one that will commend itself to those concerned. In the first place, it leaves out of account the fact that of those nine millions, a very large proportion, unfortunately, are not now in the country, and many of them died in the War, and surely the fact that nearly all the ex-Service men and officers of every rank who have spoken to-day have condemned these proposals shows that the great majority of the survivors, if you were to consult them, would undoubtedly condemn the proposal of taking money from this Fund and using it for a reduction of taxation.

I was astonished when I read the proposals that I find in the Bill. I listened with the greatest attention to the speech of the right hon. Gentleman the Secretary of State for War—than whom no man in this House is a greater master of lucid exposition, and no man knows the insurance question better than he does and has more experience in this controversy—expecting some reasonable defence of the proposals which have been put before us in this Bill. I made careful notes of such arguments as he used, but I must say that I find that nearly every one of them has been so readily exploded by the arguments of hon. and right hon. Members who have spoken from this side of the House that there is hardly one to which it is worth while referring.

I am sorry the right hon. Gentleman, when he sat down, thought fit to refer to suggestions that those who feel it their duty to criticise these proposals are animated by a desire to make party capital out of them. I certainly believe that it is very far from the motives of those who have been speaking from this side—and the majority of those who have spoken were men who have served in all ranks of the forces—to make party capital out of these proposals. We desire to discuss them on their merits, and it is the right hon. Gentleman himself, who, in a speech which my right hon. Friend behind me said contributed more heat than light to the discussion—he might have added more heat and sound than light to the discussion—who has refused to discuss the question on its merits, and resumed his seat in a climax of a thunder clap, in which he said that we who were criticising it were animated by party considerations. As a matter of fact, could any suggestion be more absurd? The men affected are only a few thousands, and are these votes going to sway any election? No; if there be any party capital to be made out of the criticism at all it would be due only to this one consideration, that the moral sentiment of the electors who are not directly affected by the right hon. Gentleman's proposals will be so aroused at the idea of laying hands on this Fund that they will turn upon those who support the proposal which the right hon Gentleman has put before us.

He started out in his speech by saying that he would prove that the charge of robbery was untrue, but, like many other mariners, though not usually mariners so experienced as himself, who set out on the stormy seas of oratory, he found that the contrary winds of fact drove him into a harbour which was by no means the destination which he had hoped to reach. He said that the reason why the soldiers only received the ordinary benefits was that the Departments guaranteed the Fund, and he also said that they only contributed their ½d. for a few years. In point of fact, they contributed their 1½d. during the currency of the scheme for nine years, whereas it is only six years ago that it was decided that the Government should pay the contributions. As my right hon. Friend pointed out, when the Government made that change and decided to make the whole contribution, it was understood, and stated at the time, that it was only as an addition to the pay of the men.

Then he said that the surplus does not arise out of the contributions of the men but out of the contributions of the Government. What is the contribution of the Government? It corresponds to the contribution of the employer in the case of an industry, and you might as well say that none of the surpluses of any of the societies arise from the contributions of the men. Of course, they do not. They arise from the general contributions of the men, the employers, and the State, aria exactly the same thing holds good in the case of this Fund. Then he went on to say that if this particular Measure was not passed, what would happen would be that the contributions of the Government would be gradually reduced, ignoring the fact, which has been pointed out by subsequent speakers, that the Government contribution is statutorily fixed—it was pointed out by my right hon. and learned Friend the Member for Spen Valley (Sir J. Simon)—but, as a matter of fact, not only is it so, but it is proved by his own Memorandum that he himself in 1923 contemplated that arrangements would be come to whereby this Fund would be distributed for the benefit of soldiers, sailors, and airmen. He says, in reply to that, that the proposals which were approved by the Royal Commission are being put into force He says, it is true, that he came before the Royal Commission and made two proposals which were approved by the Commission, and he invites the Committee to believe that those proposals are now being carried into effect. As a matter of fact, it is true that, the first one is being carried into effect, but as regards the second proposal, in the case of men who transfer to approved societies on discharge from the Forces, the new provisions take the, form of requiring them, for the purpose of title to additional benefits, to be treated as though they had been members of the society from the date of their joining the Forces, and that to enable this to be done the transfer values payable out of the Navy, Army, and Air Force Insurance Fund in respect of such men should be augmented by the estimated share of surplus earned during their period of service. As regards that, only a discretionary power is given by the Bill which we are discussing, and only a discretionary power is given to the Minister, to allow this provision to be made by regulation. That benefit which was proposed by the right hon. Gentleman himself, a proposal that was approved by the National Health Insurance Commission, is not in fact carried into full effect by the Bill which we are now discussing. The only reason obviously, is that the money may not be available, and the reason why the money may not be available is that the right hon. Gentleman is taking that £1,100,000 out of the Insurance Fund. The right hon. Gentleman appeared before the National Health Insurance Commission like a benevolent, warm-hearted Jenny Wren, and he laid on the table of the Royal Commission an egg. But since then a cuckoo has been at work, and the nature of the bird that has been hatched, is very different, indeed, from the proposal he laid before the Royal Commission. Then I would like to know what is the average of additional benefits given by the approved societies. They give benefits of every sort and kind. How can you average benefits given? On that point, I would like most strongly to emphasise the appeals made by hon. Members on these benches, at any rate, to assure to the men the benefits paid by the very best approved societies. I feel quite confident that if the right hon. Gentleman were to see his way to make such a concession, it would be warmly approved by service Members on both sides of the House. After all, this is not the Government's money; it is the men's money. It has been contributed by the men themselves, or by the Government as part of their pay, and I would appeal to the right hon. Gentleman to withdraw, at least, this part of the Bill which, speaking as an ex-service man, seems to me the worst part of a thoroughly bad Measure.

Mr. SNELL

I do not remember any time when the House of Commons has been more discourteously treated by the studied silence of hon. Members on the other side. This is supposed to be a debating chamber, where the pros and eons of difficult matters are put forward, and, from the clash of different points of view, we can get a true view of what is required. With the exception of the speech of the right hon. Gentleman the Secretary of State for War, we have had no defence of the raid which the Government are making on these particular Funds. The hon. Member for Reading (Mr. H. Williams), it is true, intervened and explained the reasons. There were, he said, times when it was discreet to speak, and there were times when it was discreet to be silent. Evidently, speaking on behalf of his party, this was the time when a discreet silence was required, the reason being that no defence could in reality be made of what the Government propose to do.

I ask the Committee for a minute or two to try to visualise what will be in the mind of the service man himself, with which, after all, we have to try to deal. How will it affect these men, not only in their pocket and in their health, but how will it appear to their mind? The soldier, the sailor, and the airman are not fools, by a long way. They have a very pungent and well-directed vocabulary, which might make some difference to this Debate, could we have the advantage of it. In any case, we are to-day in the position of having to consider what the effect upon them will really be. I have always understood that the Services were outside politics, and that, as far as possible, we should not bring them into our political warfare in any way. If we are not allowed to do it openly in the process of Debate, we need to be very careful not to intro duce politics into the Services by a side-wind, especially in a form which is going very materially to touch the prosperity and the sense of security which these men in the Services have. If the Government are anxious, as recent events appear to show them to be, to prevent any dissention growing in the Army, their proper course is to withdraw this proposal, because there is nothing more likely to create dissention there than the proposal now before the Committee. The right hon. and learned Member for Spen Valley (Sir J. Simon) appeared to be distressed that we should apply the word "robbery" in this connection.

Sir J. SIMON

I am not distressed at all. I only think there are better arguments than using that expression.

Mr. SNELL

I do not want to be behind the right hon. and learned Gentleman in restraint., and, therefore, I want to say, that if it be not the open robbery with which we sometimes have to deal, it is, perhaps, dishonest appropriation, which is not very different in its meaning. I suggest that it is a very dangerous thing to create a precedent of this character. There may be Governments following this one, which will be distressed in finding money. They may look round to see where there are funds to tap, and use this as a precedent, which they might very legitimately regard as giving them what they want. What I feel about this proposal is that these Service men did their work for the community, they suffered bitterly, and in nearly every case, when a man came out of the War, he came out with a depressed vitality. He is more liable, probably, to a lower standard of health than those of us who did not have to serve in the trenches, and if there were anything which could be done with these executive reserves, it should have been to make some provision for the welfare of the Service men in other directions of life.

What happens, say, in regard to joint stock companies? Hon. and right hon. Members opposite may not know a great deal about the working of friendly societies, but they do know something about the working of joint stock companies. When you get a company that has done far better than it expected to do, what happens? It increases the dividends to the shareholders, and sometimes gives a bonus, or waters the capital, if the State is likely to buy the thing out at some future date. In any case, the shareholders get the benefit of the prosperity. But here we have Service men, who are in a position of not being able to defend themselves, who have contributed these pennies and three halfpennies, and because the Fund has been prosperous, the Government come in to meet needs in other directions and literally put their hand into the pocket of the poor man. I would ask whether there are not other ways in which the Government might find the money they require. If they require £1,000,000 to make ends meet, there are, surely, more reputable ways of finding it than this way of raiding these poor men of their security in this respect. Of all the mean things that a Government could do, this seems to me to be the worst. Where poor

people have contributed, as these poor people did, their pennies and three halfpennies a week, under a bargain, as it were, with the Government and this House, such a fund ought to be a sacred thing. It is almost sacrilege to touch it, especially in a nation like ours, which has not exhausted the possibility of raising the money it requires in other ways.

Sir L. WORTHINGTON-EVANS

rose in his place, and claimed to move,"That the Question be now put."

Question put, "That the Question be now put."

The Committee divided: Ayes, 225; Noes, 141.

Division No. 126].	AYES.	[6.57 p.m.
Acland-Troyte, Lieut.-Colonel	Crookshank, Col. C. de W. (Berwick)	Horlick, Lieut.-Colonel J. N.
Agg. Gardner, Rt. Hon. Sir James T.	Crookshank, Cpt. H.(Lindsay, Gainsbro)	Howard, Captain Hon. Donald
Alexander, E. E. (Leyton)	Curtis-Bennett, Sir Henry	Hudson, R. S. (Cumberl'nd, Whiteh'n)
Applin, Colonel R. V. K.	Curzon, Captain Viscount	Hume, Sir G. H.
Apsley, Lord	Davidson, J. (Hertfd. Hemel Hempst'd)	Hunt, Gerald B.
Ashley, U.-Col. Rt. Hon. Wilfrid W.	Davies, Dr. Vernon	Inskip, Sir Thomas Walker H.
Baldwin, Rt. Hon. Stanley	Davies, Maj. Geo. F.(Somerset, Yeovil)	Jackson, Lieut.-Col. Rt. Hon. F, S.
Balfour, George (Hampstead)	Davies, sir Thomas (Cirencester)	Jackson, Sir H. (Wandsworth, Cen'l)
Balniel, Lord	Dawson, Sir Philip	Jacob A. E.
Barclay-Harvey, C. M.	Drewe, C.	James, Lieut.-Colonel Hon. Cuthbert
Barnett, Major Sir Richard	Eden, Captain Anthony	Kennedy, A. R. (Preston)
Barnston, Major Sir Harry	Edmondson, Major A. J.	King, Captain Henry Douglas
Benn, Sir A. S. (Plymouth, Drake)	Edwards, John H (Accrington)	Kinloch-Cooke, Sir Clement
Bethel, A.	Elliot, Captain Walter E.	Knox, Sir Alfred
Bird, E. R. (Yorks, W. R., Skipton)	Elveden, Viscount	Lane Fox, Col. Rt. Hon. George R.
Bourne, Captain Robert Croft	Erskine, James Malcolm Monteith	Leigh, Sir John (Clapham)
Bowater, Sir T. Vansittart	Evans, Captain A. (Cardiff, South)	Little, Dr. E. Graham
Brassey, Sir Leonard	Everard, W. Lindsay	Lloyd, Cyril E. (Dudley)
Briggs, J. Harold	Fairfax, Captain J. G.	Locker-Lampson, G. (Wood Green)
Briscoe, Richard George	Fanshawe, Commander G. D.	Locker-Lampson, Com. O.(Handsw'th)
Brocklebank, C. E. R.	Fermoy, Lord	Loder, J. de V.
Brooke, Brigadier-General C. R. 1.	Fielden, E. B.	Lord, Walter Greaves-
Broun-Lindsay, Major H.	Finburgh, S.	Lowe, Sir Francis William
Brown, Brig.-Gen. H.C.(Berks, Newb'y)	Foster, Sir Harry S.	Luce, Major-Gen. Sir Richard Harman
Buckingham. Sir H.	Foxcroft, Captain C. T.	Lynn, Sir Robert J.
Bull, Rt. Hon. Sir William James	Fraser, Captain Ian	Macdonald, R. (Glasgow, Cathcart)
Bullock, Captain M.	Frece, Sir Walter de	McLean, Major A.
Burgoyne, Lieut.-Colonel Sir Alan	Gibbs, Col. Rt. Hon. George Abraham	McNeill, Rt. Hon. Ronald John
Burman, J. B.	Gilmour, Lt.-Col. Rt. Hon. sir John	Maitland, Sir Arthur D. Steel.
Burney, Lieut.-Com. Charles D.	Glyn, Major R. G. C.	Malone, Major P. B.
Burton, Colonel H. W.	God, Sir Park	Manningham-Buller, Sir Mervyn
Butler, Sir Geoffrey	Grattan-Doyle, Sir N.	Margesson, Captain D.
Cadogan, Major Hon. Edward	Greenwood, Rt. Hn. Sir H.(W'th's'w, E)	Marriott, Sir J. A. R.
Calne, Gordon Hall	Grotrian, H. Brent	Mason, Lieut.-Col. Glyn K.
Campbell, E. T.	Guinness, Rt. Hon. Walter E.	Merriman, F. B.
Cassels, J. O.	Gunston, Captain D. W.	Mitchell, W. Foot (Saffron Walden)
Cautley, Sir Henry S.	Hacking, Captain Douglas H.	Mitchell, Sir W. Lane (Streatham)
Cayzer, Sir C. (Chester, City)	Hall, Lieut.-Col. Sir F. (Dulwich)	Moore-Brabazon, Lieut.-Col. J. T. C.
Cecil, Rt. Hon. Sir Evelyn (Aston)	Hall, Capt. W. D'A. (Brecon & Rad.)	Morden, Colonel Walter Grant
Cecil, Rt. Hon. Lord H. (Ox. Univ.)	Hannon, Patrick Joseph Henry	Moreing, Captain A. H.
Chadwick, Sir Robert Burton	Harvey, G. (Lambeth, Kennington)	Morrison, H. (Wilts, Salisbury)
Chapman, Sir S.	Harvey, Major S. E. (Devon, Totnes)	Morrison-Bell, Sir Arthur Clive
Charteris, Brigadier-General J.	Haslam, Henry C.	Murchison, C. K.
Churchill, Rt. Hon. Winston Spencer	Hawke, John Anthony	Nail, Lieut.-Colonel Sir Joseph
Churchman. Sir Arthur C.	Headlam, Lieut.-Colonel C. M.	Nelson, Sir Frank
Clarry, Reginald George	Henderson, Capt. R. R. (Oxf'd, Henley)	Neville, R. J.
Clayton, G. C.	Henderson, Lieut.-Col. V. L. (Bootle)	Newman, Sir R. H. S. D. L. (Exeter)
Cobb, Sir Cyril	Heneage, Lieut.-Col. Arthur P.	Nuttall, Ellis
Cochrane, Commander Hon. A. D,	Herbert, Dennis (Hertford, Watford)	Pennefather, Sir John
Colfox, Major Wm. Phillips	Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.	Penny, Frederick George
Cope, Major William	Hogg, Rt. Hon. Sir D. (St. Marylebone)	Preston, William
Couper, J. B.	Holbrook, Sir Arthur Richard	Price, Major C. W. M.
Courthope, Lieut.-Col. Sir George L.	Holt, Capt. H. P.	Radford, E. A.
Cowan, Sir Wm. Henry (Islington, N.)	Homan, C. W. J.	Raine, W.
Croft, Brigadier-General Sir H.	Hopkins, J. W. W.	Ramsden, E.
Rawson, Sir Alfred Cooper	Somerville, A. A. (Windsor)	Watson, Rt. Hon. W. (Carlisle)
Remnant, Sir James	Spender-Clay, Colonel H.	Watts, Dr. T.
Rentoul, G. S.	Stanley, Col. Hon. G. F. (Will'sden, E.)	Wells, S. R.
Rice, Sir Frederick	Stanley, Lord (Fylde)	Wheler, Major Sir Granville C. H.
Richardson, Sir P. W. (Sur'y, Ch'ts'y)	Stott, Lieut.-Colonel W. H.	Williams, A. M. (Cornwall, Northern)
Roberts, E. H. G. (Flint)	Streatfeild, Captain S. R.	Williams, Com. C. (Devon, Torquay)
Ropner, Major L.	Strickland, Sir Gerald	Williams, Herbert G. (Reading)
Russell, Alexander West (Tynemouth)	Sueter, Rear-Admiral Murray Fraser	Wilson, Sir C. H. (Leeds, Central)
Rye, F. G.	Sugden, Sir Wilfrid	Wilson, R. R. (Stafford, Lichfield)
Salmon, Major I.	Tasker, Major B. Inigo	Wise, Sir Fredric
Samuel, A. M. (Surrey, Farnham)	Templeton, W. P.	Withers, John James
Samuel, Samuel (W'dsworth, Putney)	Thompson, Luke (Sunderland)	Womersley, W. J.
Sandeman, A. Stewart	Thomson, F. C (Aberdeen, South)	Wood, B. C. (Somerset, Bridgwater)
Sanders, Sir Robert A.	Thomson, Rt. Hon. sir W. Mitchell-	Wood, E. (Chest'r, Stalyb'dge & Hyde)
Savery, S. S.	Tinne, J. A.	Wood, Sir Kingsley (Woolwich, W.)
Scott, Sir Leslie (Liverp'l, Exchange)	Titchfield, Major the Marquess of	Wood, Sir S. Hill (High Peak)
Shaw, R. G. (Yorks, W.R., Sowerby)	Tryon, Rt. Hon. George Clement	Worthington-Evans, Rt. Hon. Sir L.
Shepperson, E, w.	Waddington, R.	Young, Rt. Hon. Hilton (Norwich)
Skelton, A. N.	Wallace, Captain D, E.
Smith-Carington, Neville W.	Ward, Lt.-Col. A. L. (Kingston-on-Hull)	TELLERS FOR THE AYES —
Smithers, Waldron	Watson, Sir F. (Pudsey and Otley)	Major Hennessy and Captain
		Bowyer.
NOES.
Adamson, Rt. Hon. W. (Fife, West)	Hamilton, Sir R. (Orkney & Shetland)	Sexton, James
Ammon, Charles George	Hardie, George D.	Shaw, Rt. Hon. Thomas (Preston)
Attlee, Clement Richard	Harney, E. A.	Shepherd, Arthur Lewis
Barker, G. (Monmouth, Abertillery)	Harris, Percy A.	Shiels, Dr. Drummond
Barnes, A.	Hartshorn, Rt. Hon. Vernon	Short, Alfred (Wednesbury)
Barr, J.	Hayday, Arthur	Simon, Rt. Hon. Sir John
Batey, Joseph	Hayes, John Henry	Sinclair, Major Sir A. (Caithness)
Beckett, John (Gateshead)	Hirst, G. H.	Sitch, Charles H.
Bowerman, Rt. Hon. Chants W.	Hirst, W. (Bradford, South)	Smillie, Robert
Bread, F. A.	Hore-Belisha, Leslie	Smith, Ben (Bermondsey, Rotherhithe)
Bromfield, William	Hudson, J. H. (Huddersfield)	Smith, Rennie (Penistone)
Bromley, J.	Hutchison, Sir Robert (Montrose)	Snell, Harry
Brown, James (Ayr and Bute)	Jenkins, W. (Glamorgan, Neath)	Snowden, Rt. Hon. Philip
Buchanan, G.	John, William (Rhondda, West)	Spencer, G. A. (Broxtowe)
Buxton, Rt. Hon. Noel	Johnston, Thomas (Dundee)	Spoor, Rt. Hon. Benjamin Charles
Cape, Thomas	Jones, Henry Haydn (Merioneth)	Stamford, T. W.
Clowes, S.	Jones, J. J. (West Ham, Silvertown)	Stephen, Campbell
Cluse, W. S.	Jones, Morgan (Caerphilly)	Stewart, J. (St. Rollox)
Clynes, Rt. Hon. John R.	Jones, T. I. Mardy (Pontypridd)	Sutton, J. E.
Collins, Sir Godfrey (Greenock)	Kelly, W. T.	Taylor, R. A
Connolly, M.	Kennedy, T.	Thomas, Rt. Hon. James H. (Derby)
Cowan, D. M. (Scottish Universities)	Kenworthy, Lt.-Com. Hon. Joseph M.	Thorne, W. (West Ham, Plaistow)
Crawfurd, H. E.	Kenyon, Barnet	Thurtle, E.
Dalton, Hugh	Kirkwood, D.	Tinker, John Joseph
Davies, Ellis (Denbigh, Denbigh)	Lansbury, George	Townend, A. E.
Davies, Rhys John (Westhoughton)	Lee, F.	Trevelyan, Rt. Hon. C. P.
Day, Colonel Harry	Lowth, T.	Varley, Frank B.
Dennison, R.	Lunn, William	Viant, S. P.
Duckworth John	MacDonald, Rt. Hon. J. R. (Aberavon)	Wallhead, Richard C.
Dunnico, H.	Mackinder, W.	Walsh, Rt. Hon. Stephen
Edwards, C. (Monmouth, Bedwellty)	MacLaren, Andrew	Warne, G. H.
Evans, Capt. Ernest (Welsh Univer.)	March, S.	Watts-Morgan, Lt.-Col. D. (Rhondda)
Fenby, T. D.	Maxton, James	Webb, Rt. Hon. Sidney
George, Rt. Hon. David Lloyd	Montague, Frederick	Westwood, J.
Gibbins, Joseph	Morris, R. H.	Wheatley, Rt. Hon. J.
Gillett, George M.	Morrison, R. C. (Tottenham, N.)	Whiteley, W.
Gosling, Harry	Murnin, H.	Wiggins, William Martin
Graham, D. M. (Lanark, Hamilton)	Naylor, T. E.	Williams, C. P. (Denbigh, Wrexham)
Graham, Rt. Hon. Wm. (Edin., Cent.)	Paling, W.	Williams, David (Swansea, East)
Greenall, T.	Pethick-Lawrence, F. W.	Williams, T. (York, Don Valley)
Greenwood, A. (Nelson and Colne)	Ponsonby, Arthur	Wilson, C. H. (Sheffield, Attercliffe)
Griffiths, T. (Monmouth, Pontypool)	Potts, John S.	Wilson, R. J. (Jarrow)
Groves, T.	Pureed, A. A.	Windsor, Walter
Grundy, T. W.	Rees, Sir Beddos	Wright, W.
Guest, J. (York, Hemsworth)	Richardson, R. (Houghton-le-Spring)	Young, Robert (Lancaster, Newton)
Guest, Dr. L. Haden (Southwark, N.)	Runciman, Rt. Hon. Walter
Hall, F. (York, W. R., Normanton)	Scrymgiour, E,	TELLERS FOR THE NOES —
Hall, G. H. (Merthyr Tydvil)	Scurr, John	Mr. Allen Parkinson and Mr. T.
		Henderson.

Question put accordingly, and agreed to.

Resolution to be reported To-morrow.