HC Deb 01 December 1930 vol 245 cc1827-952

Considered in Committee under Standing Order No. 71A.

[Mr. ROBERT YOUNG in the Chair.]

Motion made, and Question proposed, That it is expedient to raise to seventy million pounds the limit on the amount of the advances to be made by the Treasury to the Unemployment Fund under Section five of the Unemployment Insurance Act, 1921, as amended by subsequent enactments, which may be outstanding during the deficiency period."—(King's Recommendation signified.)


Before we begin the discussion on the Money Resolution, I must say that several hon. Members have approached me as to the scope of the debate. The question of the duties of the referee and the umpire, the rates of benefit, etc., do not arise. The question is merely an extension of the money to be placed at the disposal of the Treasury for the purposes of the Acts of Parliament as they now stand.


May I ask your guidance on a further point. Would it be in order to discuss the abuses of the Unemployment Insurance Benefit?


The Resolution says "that it is expedient" to do certain things. There is a Bill to follow the Resolution, and any complaints of that character will naturally arise on the Bill.


Is it not possible to discuss the expediency of this being done?


The words of the Resolution are, "That it is expedient" to do so and so.


In order to discuss alternative expedients—


I do not know what the hon. Gentleman means.


I mean alternative action that could be taken if the money were not granted.


The Resolution asks for another £10,000,000 for the purpose of the Acts. The hon. Gentleman can give reasons why it should not be advanced, and in the course of those reasons he may mention some alternatives, but I must wait and see what they are.

The MINISTER of LABOUR (Miss Bondfield)

I hope that I shall be able to keep within the Ruling of the Chair. I am anxious to lay before the Committee figures relating to the finance of the Fund and to the live register, and some facts relating to the manner in which the exchange administration is endeavouring to conserve the Fund; and I hope to make some incidental references to charges which have been made in regard to the maladministration of the Fund. I will do my best to keep within the Ruling of the Chair, and I hope that the Chairman will not be too strict with regard to the line which he has drawn. With regard to the history of the Fund, it may be for the convenience of Members if I refer to the position as it has developed since the Government came into Office. On the 1st June, 1929, when the Labour Government came into office, the debt stood at £36,870,000, and the live register on the approximate date—27th May—was 1,132,281. The balancing point of the Unemployment Fund at that date was 1,000,000, so that it will be seen that the debt was increasing, and that further financial provision was immediately necessary. The first step that was taken was in the Act of 26th July, 1929, when the Exchequer contribution was raised from 38 per cent. to 50 per cent. of the joint contribution of employers and employed. That added £3,500,000 per year to the income of the Fund. That established what we called the "equal-thirds" basis.

The next step that was taken was in connection with the extension of the transitional period by 12 months under the Act of 6th February, 1930. This provided an additional Exchequer contribution to meet the transitional benefit claims for new benefit years. The effect of this was to relieve the ordinary revenue of the Fund of about half the cost of transitional benefit in 1929–30, namely by £3,985,000, and of the full cost for 1930–31, which is now estimated to amount to £22,000,000. The balancing point of the Fund was thus raised to 1,275,000 approximately. The result of this change was to divide Unemployment Insurance into two separate parts. There was first the ordinary benefit, which, with the interest on the debt and the cost of administration, is defrayed out of the contributions of the employers and employed, and the contributions on the equal-thirds basis of the Exchequer. Secondly, there was the transitional benefit, which, with the cost of its administration, is financed wholly by the special equivalent grant made to the Unemployment Fund from the Exchequer.

4.0 p.m

Apart from extending transitional benefit and placing the cost of transitional benefit on the Exchequer, the effect of the 1930 Act was to increase certain rates of benefit for young men and women and adult dependants; to repeal the genuinely seeking work condition and the transitional condition as to reasonable period of employment in the last two years; to recast the machinery for the decision of claims so as to secure that except in trade dispute cases no one except a court of referees or the umpire can reject a claim to benefit. The effect of these changes, so far as they can be ascertained at present, is, with a live register of the present dimensions, as follows, and it is rather important that the Committee should note these figures: Increased rates of benefit, £4,250,000 per annum; benefit paid to persons on the register who would previously have been disallowed, 110,000 in number, £5,500,000 per annum; benefit paid to married women and others added to the register, estimated to be 70,000 claims, £3,250,000 per annum. Altogether the number of additional claimants is 180,000 and the amount per annum £13,000,000.


Is that the number of claimants who receive benefit?


Claimants who receive benefit.


What does that figure include?


Those brought within the 1930 Act.


Does that include the transitional benefit?


180,000 is, I believe, really a generous estimate. Those are what we believe to be the numbers added to benefit as a result of the working of the 1930 Act. I want the Committee to compare that figure with the general figures I am now going to give. The debt at present stands at £56,000,000. It is increasing at the rate of £40,000,000 per annum. Contributions paid by workpeople amount to £14,000,000; contributions paid by employers, £16,000,000; and contributions paid by the Exchequer, £15,000,000 per annum. That is what we call the equal-thirds Insurance Fund. The cost of ordinary benefit taken out of the Fund, including interest, comes to £85,000,000 per annum. The transitional benefit, the cost of which is payable wholly by the Exchequer, during 1930–31 is estimated to be £22,000,000 at the rate prevailing now. The total of the ordinary benefit and interest paid out of the Fund, together with the transitional benefit paid by the Exchequer, plus the cost of administration, amounts to £107,000,000 per annum. The cost of administration, which has to be deducted from that figure, is £6,500,000, and of that cost £1,500,000 is debited to the transitional benefit account. In addition to that, there is the cost of interest on the full debt, namely, £3,000,000 per annum, so that you have to deduct from that total of £107,000,000, £3,000,000 for interest and £6,500,000 for administration to get the actual sum paid in benefits.

It will be seen, from the figures I have already given, that the big figures occurred under provisions assented to by all parties in the House, that is to say, the main sums of increase are under the heading of the wholly unemployed who are definitely in the employment field, and of short time and intermittent work. There was no suggestion at the last inquiry that was made into the working of the Fund at that time that either short time or intermittent work should be interfered with at all. It was accepted as a workable scheme, and has been accepted ever since 1922, that the conditions under which short time and intermittent work was dealt with should be continued.


Will the right hon. Lady say to which inquiry she is referring?


The 1927 inquiry. I pointed out that the real big increase occurred under conditions apart from any change made by the 1930 Act. I think it is very important that that should be made quite clear to the Committee.

I turn to the question of borrowing. In regard to the finances of the Fund, I think that there is really nothing to choose between the parties in the House as to the methods hitherto adopted in financing this Fund. We are all sinners alike. The Coalition Government started with £22,000,000 in hand, and borrowed £14,000,000 by 1922. The Conservatives, during their last term of office, borrowed £32,000,000 and extended the transitional benefit period. The present Labour Government have borrowed up-to-date £20,000,000 and have separated transitional benefit from the Insurance Fund. If we are all prepared to recognise ourselves as sinners in respect of this matter, do we agree as to the form our repentance is to take? The real difficulties are fundamental to the system. Can we find an agreed solution in the political field? I think there is general agreement that there should be a national unemployment insurance scheme on a solvent basis. Also I think there is general agreement that provision should be made for unemployed persons who are unable to maintain unemployment insurance contributions. But is there agreement on the principles on which a solvent insurance scheme should be framed, as regards the inclusion of persons properly falling within it, and the exclusion of others unemployed? Is there agreement with regard to the nature of the scheme, including the rates of payment, the extent to which individual needs are to be taken into account—


The right hon. Lady is going a little bit wide of my ruling at the beginning. It is not a question of whether the Committee agrees whether benefit of that kind should be paid.


I would like to ask you, Mr. Young, seeing that the right hon. Lady has submitted these questions, whether we are not to be allowed to answer some of them, as some of us feel that the answer is very strongly in the negative?


That is just the point. I am not able to know what the right hon. Lady is going to say before she has said it.


If it is with the goodwill of all parts of the Committee, would it not be wise to allow the discussion to cover those points which are really germane to the reasons for this Motion? It is, of course, a matter for your ruling, but it seems to me that the difference of opinion is as to what is expedient, and for what reason it is expedient.


That is going far beyond the Motion. There is a growing tendency to develop these Money Resolutions into Second Reading debates. I pointed that out on the last occasion, and it is necessary for us to confine ourselves more strictly to the Motion. Therefore, I think that on this occasion it must be done.


May I submit that in Committee we ought to have the fullest explanation why this extra money is necessary, and surely the right hon. Lady is entitled to ask a question?


That is quite a different thing from discussing whether we agree about certain vital matters.


I can only express my regret, and try not to offend again. In the experimental year great progress has been made in the analysis of groups and, if I am in order, I would like to mention some figures which will give some indication of the nature of the register and the classes of persons upon whom the money is spent.


The right hon. Lady is entitled to say how many persons are drawing so much money as that affects the Fund.


During the summer of last year unemployment was a little below the average of preceding years. It rose a little during the early winter of 1929, and the figures in November reached recent years' averages. When we came to the Christmas trade, the usual drop did not take place, and we began to get a warning of what was likely to follow. After the Christmas trade there is always a decline of business, but instead of that drop at Christmas and then an increase, there was a steady ascent from the end of November, and there was no normal drop for the Christmas trade. From January last to the present time it has risen steeply and continuously. In December last, 11.1 per cent. of the insured persons were recorded as unemployed, and on 27th October the percentage was 18.5. A year ago there were 1,273,531 persons on the register. That was the total number on the register, including those not insured. A fortnight ago, on 17th November, there were 2,285,987, an increase of 1,012,456. Of this increase, 675,500 were men, 26,500 boys, 289,900 women and 20,500 girls. Of the total increase since a year ago, 703,794 were among the wholly unemployed, 281,388 among the temporarily stopped, and 27,274 among the casuals.

Married women now form 50 per cent. of the women claimants. In April, 1927, they formed 26 per cent. It is estimated that the proportion of married women among the whole number of insured women is betwen 25 and 30 per cent., but this proportion is much higher in such trades as textiles and pottery, in which there is specially heavy unemployment among women. As regards those who are actual claimants on the Fund, the last analysis, which was in the Ministry of Labour Gazette for November, dealt with the date 27th October, when there were 2,246,400 insured persons recorded as unemployed, of whom 283,541 are in coal mining, 233,073 in cotton, 174,444 in distribution, 125,935 in general engineering and 143,731 in building. These figures speak for themselves as to the nature and the great volume of unemployment with which we are faced.

Lieut.-Commander KENWORTHY

Is there any explanation of the enormous spectacular increase in the number of married women?


I specially got out these figures, because I felt quite sure the Committee would want to know them. I have not got an analysis of the married women week by week, but we have had a special count made with regard to the married women on the register on 7th July, 1930. The total number of married claimants was 199,750. Of these, the number of married cotton operatives was 72,500 or 36.3 per cent., and married pottery workers, 6,000, or 3 per cent. of the total. The total number of women claimants in the cotton industry was 165,000, and of that number married women were 72,500 or 44 per cent. of those claimants. The total number of women claimants in the pottery industry was 13,000, and of this number 6,000 were married women, showing the married women claimants as 46 per cent. While it is quite true that those figures do show, in one sense, a very spectacular rise, what we have to bear in mind is that the trades in which there are the largest number of married women are the trades which have been specially hit at this particular time. It is a matter of very great concern to those of us who are dealing with this matter, and to all who are concerned with these particular trades, to make quite sure that any step which may be taken will not create more injustice than the injustices which it is proposed to remedy, and that is one of the points in regard to which we feel that the Royal Commission is so essential; because the married women themselves ought to have an opportunity of putting their side of the matter before any change is made.

Statements have been made very freely throughout the country about the mal-administration of the Fund by slackness of administration, the paying out of Government money without due regard to the rules, and so on, and I think it would be only fair to the Fund and the Committee if, with the permission of the Chair, I might deal with that point, but I will come to it at a later stage. Before I deal with the negative side of the work I wish to put the positive side, and to show what we are doing. I wish to pay this tribute to the work of the Exchange staffs. Throughout this terrible time they have been pursuing with great energy the difficult task of placing people in work which is now rapidly becoming the most important side of the work of the Exchanges, as it ought to be. Notwithstanding the pressure of work arising from the abnormal increase in the live register, there has been a gratifying increase in the placings side of the work. I have here a table showing what has been done. I will not weary the Committee by reading it now, and perhaps they will permit me to have it embodied in the OFFICIAL REPORT. It shows the increase in the number of placings during this year as compared with last year, giving the figures from April to October in 1929 and in 1930. The April figure in 1929 was 28,000 a week, and in 1930, 32,395. In October, 1929, there were 29,296 placings weekly, and in October, 1930, 35,098 placings. The average number of weekly placings during those months was 28,459 in 1929, and 32,229 in 1930. Putting the figures in another way, up to the 17th November this year the number of placings had increased by 144,742 as compared with the same period in the previous year. In 1930, up to the 17th November, the total number of placings was 1,528,255.


Did I understand the right hon. Lady to say that she wishes to embody in the OFFICIAL REPORT a number of figures which she has not read out? If that is so, would it not be more in accordance with precedent to give those figures in reply to a question, and not have them embodied in the report of her speech?


I will certainly do that.


Can the right hon. Lady give us any information as to the length of time these people retained the situations found for them? Can she tell us what has happened to the people who were placed in employment, and how many of them required to be replaced in employment?


I am afraid it is not possible to do that. We have no method of measuring the jobs.


Then the placings mean placings and replacings? The same person may be counted many times over?


That is so; but the comparative figures will stand. Obviously, the figures give the number of jobs that are found for persons, whether it be the same person or another person—the persons who were successfully placed in jobs.

I come to what are known as the abuses of the Fund, that is to say, cases where money is alleged to have been paid when it should not have been paid. In regard to married women claimants there are two broad facts to bear in mind. It is constantly being urged in letters and newspaper articles that a large number of married women are getting benefits to which they are not entitled. Personally, I do not believe that to be the case. I believe it is very difficult to administer unemployment benefit to married women living in a district where women are not normally employed after marriage. That is one of the great difficulties in connection with administration. I have already given figures to show that the great majority are not in that class; but I am perfectly prepared to see what can be done with regard to the other category of cases, where it depends upon the intention of the woman, where everything depends on whether the woman intends to go out to work again or not. The gravamen of the charge is that we pay benefit to some women who have no intention of ever returning to work. In so far as that be true, I am going to do everything I can to stop it at the earliest possible moment, because in my opinion it is a dishonest misuse of the Fund. But the difficulty arises as to what is the woman's intention, and we have to devise some method of determining that question.

With regard to seasonal workers, letters are constantly appearing in the Press stating that we pay benefit to seasonal workers who do not intend to work in the off-season. I believe myself that the numbers in this class are very small indeed. We have no difficulty whatever in dealing with the category of seasonal work. The umpire has ruled that a seasonal worker out of season is not entitled to benefit, and he does not get benefit, but, just as in the case of married women, there may be a fringe of cases which create uneasiness when anyone comes up against them. There is the case where a man has no intention of working between seasons, but does not tell the Exchange of that fact, and presents himself at the Exchange, so that he can draw benefit. I believe those cases are infinitesimal in number compared with the real seasonal workers, who do not draw benefit, who are merely seasonal and are not in the area of employment during the off-season.

The really serious and difficult problem arises over an industrial development in connection with short-time working. The basis of the criticism is this, that there is a class of workers who earn fairly high wages during a short period of employment in a week and therefore ought not to get unemployment benefit for the remainder of the week when they are not at work. As regards these short-time workers there really is not very much doubt about the evidence. It is very well known that employers and workmen do take full advantage of the benefit rules in the sense of so adjusting short-time working as to enable the men to qualify for benefit; but it must remembered that that is a policy which was advocated in the past; and if what has happened has outgrown the original intention it becomes so fundamental to the proper working of the Act that here again, I submit, there ought to be a public inquiry before we attempt to make any really drastic alteration in our methods.

I will give one illustration of what may be called the development of short-time working by arrangement. The Garforth Colliery circulated a leaflet in which they said: The pits will be so worked as to qualify the employés for three days unemployment benefit in alternate weeks. The unemployment benefit will therefore more than cover the reduction in wages. We have to ask ourselves whether that is to be accepted as being in accordance with the original intention. I say emphatically that I do not think it is. It was never intended that the unemployment insurance system should be used as a means of reducing wages. The other illustration I wish to give arose in connection with the London furniture trade, where an agreement was made to work short time so as to avoid discharges, and the union circulated to its members detailed notes justifying the arrangement of short time on the ground that unemployment benefit could be drawn and giving instructions as to the procedure. I want to make it perfectly clear that in both these cases the action is perfectly legal as the Acts stand at present. It is not an illegal abuse of the Fund, but I say that it is a development which was never contemplated when the Fund was established.

In connection with intermittent work, we have had a very large number of cases brought to our attention by newspapers and otherwise which again prove to be entirely within the four walls of the Fund, entirely within the rules. There is the case of intermittent work at the docks, and we now hear as a development of intermittent work in bars and among shop assistants—in all kinds of week-end trade in which extra hands are taken on for a few days or taken on at a busy time of the year, and there are whole establishments working on this short time. That, again, seems to be a development which was never contemplated when the Fund was established. Quite recently a most interesting and exhaustive inquiry into the position at the Liverpool Docks was made by the Lord Mayor of Liverpool and other public-spirited persons. They have issued their report. The rest of the country is being covered in a survey which is being made by what is known as the Maclean Committee, presided over by the right hon. Member for North Cornwall (Sir Donald Maclean), which, I believe, and hope will be able to complete their report shortly. These matters are of serious consequence to very large bodies of men and will require very serious consideration, and opportunity must be given to all people in these categories to put their side of the case before any fundamental change is undertaken.

May I now come to what I believe to be the froth of the abuses, which have attracted the attention of the country more than these other things, which are fundamental and constitute the serious side of the case we have to consider? I want to deal with these cases, however, because I want to reassure the public regarding the administration of the Fund. First, I will take a case quoted in the "Nottingham Guardian" of 18th September, the statements in which, according to the correspondence I have received, have met with wide credulity. The first allegation made was that a girl who had left school a year previously and during the year had paid 24s. into the Fund, had received in benefit £150. In the circumstances, the girl must have been under 18 years of age. The total weekly contribution payable in respect of her would be 9¾d. per week, and the total of 24s. which was supposed to have been paid would mean that there had been less than 30 contributions, and, therefore, in any case being under 18 she would not have got benefit. But let us assume that she did draw the benefit. Being a girl under 18 years of age with less than 30 contributions she could not have drawn any benefit at all, but for a girl under 18 to receive £150 in benefit at the appropriate rate would take 11½ years! The newspaper stated, however, that she received £150 in one year, and therefore she must have maintained, with dependants' allowances, not only herself but a husband or parent and at least 23 children!

The further case quoted in the same paper at the same time was to the effect that a woman whose husband was in employment, had paid £4 and had received £380 in benefit. For the sum of £4 to have been paid in contributions a woman would have been in employment for rather more than 50 weeks. To have received £380 in benefit a woman would have been in receipt of benefit for almost 10 years. As she would have paid contributions for a year as well the period of over 11 years more than accounts for the whole period since the 1920 Act came into operation, and therefore the allegation is palpably false. These two examples alone show the baselessness of the allegations which have received such wide publicity. Inquiries show that the journalist did not know anything about it himself but just wrote it up from other newspapers. I will give an example of a different type of alleged abuse. In the "Manchester Guardian" of the 25th September the following statement appeared: If it was not for the dole—subsidised laziness I call it—all the scores of acres of grain blackening and rotting in Northamptonshire fields would have been in by the first week in September. This remark was supposed to have been made by a leading farmer in the district, who also alleged that it was impossible to get the labour required, and that a number of unemployed men had refused work on the farms and were continuing to draw unemployment benefit. The first point to which I want to draw attention is that in this case the farmer approached the men on the road, but did not go to the Exchange, and he did not report the circumstances of their refusal to accept employment to the Exchange, so that if the men continued to get unemployment benefit the farmer himself must have shared the guilt for he had not taken the trouble to give the necessary information to the Exchange. My inquiries show that in the district in question there was only one case known of a suitable applicant refusing to accept temporary work for harvesting. The case was reported to the court of referees, and the claim for benefit was disallowed.

Numbers of complaints have been made during the past year, as in the past years, about the difficulties experienced by farmers and employers in obtaining labour for seasonal work. It has been alleged that Employment Exchanges are not endeavouring, or are not in a position, to supply the necessary labour, notwithstanding the huge volume of unemployment in the country. These complaints on investigation have proved to be without foundation. Had the farmers notified their demands to the local offices of the Department which are in touch with a much wider area and have a greater supply of labour no real difficulty would have been met in supplying their demands. Instead of doing that, they merely tried to obtain the labour they required from purely local sources. That this is the case may be evidenced from the success which has been achieved by the Exchanges in supplying labour for sugar-beet work. In previous years, sugar-beet growers had been content to rely, to a large extent, on the services of immigrant Irish labourers. This year special efforts were made by the Ministry of Labour and the Ministry of Agriculture to enlist the co-operation of farmers and growers with a view to their demands being notified to Employment Exchanges. A special leaflet was issued for this purpose, and, as a result, the number of vacancies filled by the Exchanges this year by English labour was considerably greater than in previous years.

With regard to harvesting, farmers have not got into the habit of using the Exchanges, and this may have led in individual cases to an apparent shortage of labour. Progress necessarily is slow, but at the present time vacancies are being filled to the extent of 27,000 annually. In June of this year a large number of letters was sent to farmers and to the Farmers' Union suggesting that they should use the Exchanges, particularly for harvest labour. There was very little response. For example, investigation of a recent complaint that harvesting labour was not available in Monmouthshire showed that only two of 19 farmers said to be affected had notified any vacancies to the local offices, though some 2,000 farmers in Wales had been specially asked by letter to co-operate with the Exchanges. There is no evidence that unemployed men are reluc- tant to take temporary work at agricultural rates. In the few cases where temporary agricultural employment offered to suitable men has been refused benefit has been disallowed by courts of referees. The Department have for some time past endeavoured to secure that claimants for benefit shall not refuse temporary agricultural work, and for this purpose a leaflet has been issued explaining that the taking of temporary agricultural work will not prejudice claims to benefit.

In the "Western Mail" and "South-West News" a series of articles appeared some little time ago containing various allegations. It was alleged that the 1930 Act reduced the powers of surveillance of the court of referees to a minimum and made them ineffective to prevent improper payments. In fact, the 1930 Act has strengthened the position of the courts of referees, and they are now able to give binding decisions on claims instead of recommendations. Excepting in trade dispute cases, all claims on which doubt arises must go before a court of referees. Under the old procedure, the court heard only appeals against decisions of the insurance officer and cases of review after 78 days. There are more courts in operation at present than there were in the past, and the work of adjudication is more localised, so that there is less chance of successful misrepresentation due to lack of knowledge of local conditions on the part of the court. Those articles also made criticism of the administration, alleging that there was a disinclination to take proceedings against fraudulent claimants because of possible reflection on the vigilance of Exchange officials. There is no foundation whatever for this allegation, because all cases of suspected fraud are closely investigated, if necessary in conjunction with the Ministry of Health, and legal opinion is taken on the question of proceedings. There were also further allegations with regard to the control of branch employment offices. Each branch office is attached to a parent Exchange and the work is closely supervised and controlled by the manager of the parent Exchange as well as by the divisional office. If any irregularities occur, they are soon discovered, and, if their seriousness warrants it, are followed by dismissal of the branch manager.

I have tried to put before the Committee all the relevant facts concerning the question before it, the state of the fund, and the vigilance and energy of the Exchange administration. The figure of £10,000,000 will be exhausted as follows, and I am sure the Committee will want to know how I estimate that the £10,000,000 will be required. With an average number on the live register of 2,200,000 the average weekly amount by which outgoings will exceed revenue without allowing for interest will be £610,000, and the £10,000,000 will last up to the middle of April. With an average number on the live register of 2,500,000, the average weekly amount by which outgoings will exceed revenue without allowing for interest will be £880,000, and the £10,000,000 will be exhausted by the middle of March. We are doing our best to meet that situation, and therefore both on account of finance and on the date of expiry of transitional benefits the Minister of Labour, whoever that may be, is bound to report again to the House in the early spring. By that time I believe that the Royal Commission will have completed its survey of the outstanding problems to which I have referred and there will be a greater knowledge than we have at present as to the trend of prices and of trade. As was stated at Question Time, we have given a special reference to the commission with regard to transitional benefit, and I hope their complete report will be available before the end of the Session. I now ask the Committee to vote this Money Resolution and to reject the Amendment for the lesser sum which I understand is going to be moved.


I beg to move, in line 1, to leave out the word "seventy," and to insert instead thereof the word "sixty-nine."

My reason for doing so is that we think the Government are not justified in coming here to-day to ask for a Vote of £10,000,000, unless they are prepared at the same time to give us some indication of the way in which they propose to deal with the matters to which the Minister of Labour has referred. I say at once that I am not referring to cases of fraud which I think are very few because the vigilance of the officials will see to that, but I am referring to the principle of unemployment insurance which is involved in this proposal. The right hon. Lady has referred to the three-party committee which was suggested to consider this question. I do not know what has happened in regard to the two-party committee, but my experience of the three-party committee does not justify the hope that such an experiment will ever be repeated.


I hope we are not going to have a controversy about the three-party committee.


No, I hope we are not going to have any controversy about it; that is the last thing in the world that I wish for; but the right hon. Lady has referred to the appointment of the Royal Commission, and I was endeavouring to point out that all these questions which she is proposing to refer to the Royal Commission are just those very questions which the Three-Party Committee considered at her request for about four months. With reference to her statement that this Royal Commission is about to be appointed, I would ask her, if these questions are now to be referred to a Royal Commission in order to assist her to reduce this amount for which she is now asking, why was not the Royal Commission set up last July? The effect of the delay of four months has been, of course, that this amount for which she is now asking is an increased amount The result of that is that a further burden is being imposed on the Exchequer, and the last and least important result is that six Members of the House wasted a good deal of time in doing something which has now turned out to be entirely useless. The Lord Privy Seal said the other day that the justification for setting up this Royal Commission was that it was necessary that the light of publicity should be thrown upon the allegations—and that was one of the points which the right hon. Lady made—that are made throughout the country on a very broad scale. If publicity is required, I would ask the right hon. Lady whether she is prepared to publish the report which I and my hon. and gallant Friend the Member for Kelvingrove (Major Elliot) made to the Government—


I am in some difficulty about that report. Is it a financial report, dealing with financial matters?




If it is, I can allow the hon. Baronet to ask a question about it, but no more.


That is all that I propose to do. I want to ask whether, if publicity is what is required, the right hon. Lady will publish, not only the report of the hon. Member for Leith (Mr. E. Brown) and his colleagues, but also the information which was put before the Three-Party Committee and on which its reports were made, and whether she will publish the minutes of the Three-Party Committee, because it may well be that then she would find suggestions made which would enable her to save some of the money for which she is asking in this Resolution.

Of course, the inference from these proceedings is perfectly obvious. Some people in this House, and a great many outside, will point out that last July, when the right hon. Lady was desirous of borrowing another £10,000,000, and wanted to get that Financial Resolution through with a minimum of trouble and as little Parliamentary criticism as possible, she said, "We are going to have a Three-Party Committee, so you may very safely vote for this £10,000,000." She comes here to-day and asks for another £10,000,000, and says, "You may safely give us this £10,000,000, although I myself have referred to a great many legal abuses, because we are going to set up a Royal Commission which will go into the whole matter." The further inference that will inevitably be drawn in the country is that the object of the Government as a whole is to avoid as far as they can dealing with a very difficult and thorny question. About a year ago—on the 25th November, 1929—the right hon. Lady, on a similar occasion, said this: If you came forward and wiped out the limit of borrowing powers at £40,000,000 and went on borrowing to £50,000,000 or £60,000,000, it would be a dishonest course, because it would be contracting a debt that you saw no possible way of paying off."— [OFFICIAL REPORT, 25th November, 1929; col. 1103, Vol. 232.] This Financial Resolution proposes to increase the borrowing powers to £70,000,000, and I am perfectly prepared to accept the description of the Minister at that time with regard to the action of the Government to-day. This is the third time within a year that they have violated their own canon of honesty. Of course, the right hon. Lady was perfectly right. This, in fact, is not a loan; it is a raid. It is a loan which, as the right hon. Lady said, has little chance of ever being paid off. It is really using borrowed money for current expenses, and to that extent, of course, it is a raid upon the Sinking Fund. Therefore, I agree with the right hon. Lady when she says that it is a dishonest course to go on borrowing in these circumstances money which you can see no reasonable chance of ever being able to pay off.

The facts with regard to the finance of this business are very simple and clear. Quite shortly, they are these. The income of this Fund is £45,000,000 a year; the expenditure is £70,000,000 a year; and the balance, namely, £25,000,000 a year or rather more, is being made good—the gap is being closed from time to time—by successive borrowings from the Exchequer. It would not be in order now to refer to those persons who are on transitional benefit, because they are provided for by the Exchequer and not out of the Fund, and I only want to say this one thing in order to illustrate the point that I am going to make. There are, in addition to those who are provided for out of the Fund, about 350,000 persons on transitional benefit—an increase of something like 200,000 in the last 10 months—and they are costing the Exchequer about £22,000,000 a year. All of these people, both those on transitional benefit and those on the Fund, we are providing for under the name of insurance, and the House knows, the country knows, and the Government know, that a great part of this money is not money paid as insurance, but is really indiscriminate and unlimited outdoor relief. [Interruption.]

This position has been largely caused by the Act of 1930, the Act of the right hon. Lady, which violated every principle of insurance, and, as the right hon. Lady has pointed out, those principles may now be violated with impunity under the sanction of the law. The first result of that is that to-day the Fund is bankrupt. The second result is that our system of contributory insurance is being discredited, and a burden is being thrown on the Exchequer which will very greatly aggravate the embarrassments of the Chancellor of the Exchequer when next he comes to bring in his Budget. With regard to the second point, I have always been and am a very warm supporter of the system of contributory, mutual, compulsory insurance, and it is because I support that system that I regret it more than I can say when I see that system being debauched and discredited by the position in which we find ourselves today. My contention is that the information in the hands of the Government is ample to enable them, if they chose, to deal with the situation, and that the appointment of this Royal Commission, which will report at some future time, is merely an opportunity to enable them further to evade their responsibility.

I have referred to the Act of 1930, and will now refer for a moment to the Act of 1927, because it has a very direct bearing on the situation in which we find ourselves. The Act of 1927, which was based on the Blanesburgh Report, which was signed by the right hon. Lady—a fact which is sometimes forgotten—laid down two main qualifications for benefit. One was that 30 contributions should have been paid, and the other was that the applicant was genuinely looking for work. Nobody can look at that report without realising and appreciating that these two conditions hung together, and that, if you took away one, you entirely destroyed the structure upon which the Blanesburgh thesis rested and upon which the Act of 1927 was based. In 1930, one of these qualifications was removed, and nothing whatever was put in its place. This action, I am certain, was largely responsible for the present position of the Fund and for the position in which we are placed to-day. It cannot be said that the Government were not warned as to what would be likely to happen, because, in his report of December, 1929, the Government Actuary said this: The possibility should, however, not be overlooked, that the new provision."— that is to say, the provision doing away with the condition as to genuinely seeking work— may have the effect of bringing certain other persons into benefit, for example, married women who have done little or no work since marriage, and seasonal workers during the "off-season." These two classes of cases will serve as illustrations of what in the aggregate may amount to a considerable group of new claimants, consisting of persons who so to speak are not really in the market as competitors for employment, but may hold themselves out as such if they are thereby enabled to qualify for benefit. There are, however, no data enabling any estimate to be made of the additional cost arising under this head. The right hon. Lady gave to-day a figure of 120,000, which I assume includes not only those who are getting money from the Fund, but also those who are on transitional benefit.


I gave the figure of 70,000 as the number of married women and others who have been added to the register.

5.0 p.m.


I beg pardon; I took it down wrongly. That is rather more than the figure given in the Ministry of Labour Gazette this month, which, I think, is 60,000. To my mind it is absolutely certain that the number of those added to the register by reason of the Act of 1930 is not represented even remotely by the figure of 60,000 or 70,000 or whatever it may be, and for this reason, that the effect of the Act of 1930 was to encourage and make easy just those arrangements—perfectly legitimate arrangements—between employers and employed under which, by working three days a week only, they are enabled to get benefit for the other three. The result of the removal of that condition by the Act of 1930 has been to encourage those very two processes which you want to avoid—firstly, the direct encouragement to use this Fund as a subsidy for wages and, secondly, the encouragement of its use as a supplement to wages in the manner which I will describe in a moment. It is certain that this process, having begun, is not going to stop, and to my mind it is only in its infancy, because, when it becomes obvious that it is open to every employer, if he can, to make use of this Fund as a substitute for wages, that process is one which, of course, will go on. In that way the right hon. Lady has imposed a burden upon this system which it was never intended to carry and which it never can carry. Whatever may be said as to subsidies and supplements of wages, it cannot in any circumstances be right that you should subsidise or supplement wages out of other people's money. If you are going to subsidise or offer supplements, let it be done in a straightforward way, and not under the name of insurance which, of course, it is not. The Fund balances at a figure of 1,250,000 persons. There are just about 2,000,000 persons in receipt of benefit, of whom 350,000 are getting transitional benefit. If, as the right hon. Lady said, and the Chancellor of the Exchequer, in a very striking speech, said the other day, you are going to face up to this problem and put the Insurance Fund upon an insurance basis, you can only do it by one of three ways. You can only do it either by reducing benefits, by increasing contributions, or by raising the qualifications of those who get it. There are no other ways which the wit of man can devise to put it on a sound insurance basis. So far as I am concerned, and I think I speak for all my hon. and right hon. Friends on this side of the House, it is important, first, once and for all to draw and maintain a clear and definite distinction between insurance and relief. Secondly, it is necessary to put this Fund on an actuarial insurance basis, and I repeat that, if the Government had shown any indication whatever of being prepared to face up to this problem, we should have done our utmost to assist them in every way that we could. It is to my mind clear that the third method of raising the qualifications is one which must be adopted. To do that, it is absolutely essential to return to a ratio between contribution and benefit. You must return to a system under which you get so many weeks' benefit for so many contributions. That of itself would automatically check many of those legal abuses to which the right hon. Lady has referred. If it did not do so, you might well think that you would have to give special treatment to those trades and to those interested who deliberately exploit the Fund in a manner not only unfair to the insurance system but extremely unfair to the contributors to it who belong to other trades.

In a moment or two I shall endeavour to make certain suggestions which, if adopted, would have the result that a smaller sum would be required. Before I do that, I want to give an example of an abuse—a legal abuse—which is at the moment fairly prevalent; which, unless corrected, will bring any fund to bankruptcy, and which also is quite indefensible in any system of genuine insurance. The figures I am going to give were given to me, and I was told that I could quote them, by a gentleman who was an hon. Member of this House for a time. He gave me—and I would not have used the figures without his permission—his personal assurance that he was prepared to verify and vouch for them. I believe that they are in the possession of the Ministry of Labour. Again, I say that there is nothing illegal in what is taking place, but it is contrary to every principle of insurance and to the spirit of insurance, and if carried out to any large extent it will render bankrupt any fund which finances any insurance scheme. There can be no doubt about that. I have no objection to mentioning this gentleman's name. He said I might do so. He is Sir Lewis Lougher who was Member for Cardiff in the last Parliament. He says: There are 1,527 trimmers at Cardiff, Barry and Penarth, all of them members of their union. A full working week is 42¼ hours. The actual average working hours in the four weeks ending 1st October, 1930, were 27½ hours per man, equivalent to just under 3½ eight hour days. The union keeps rotas of trimmers and each man is called out for work in turn. Consequently every man gets equal opportunities of work if he cares to take it and it is impossible to go for a whole week without a chance of a turn. The total earnings each week are pooled by the union and divided among all the trimmers who have worked, excluding about 10 per cent. or so who are not available through sickness or accident. Assuming that the pool is equally divided, the average weekly earnings for the four weeks ending 1st October, 1930, were £4 9s. 10d. per man, that is, for 3½ days' work. The average weekly earnings for the nine weeks ending 5th November, were £4 1s. 7d. per man. When not working on any day, a trimmer is free to register as unemployed, and if he qualifies for benefit in any particular week, he retains that benefit in addition to his earnings from the pool. Here, therefore, you have a group of between 1,300 and 1,400 men whose earnings average over £4 a week for working a 3½-day week, and each week, on the average, over half of them establish a claim for benefit. The number of trimmers who established a claim for benefit in the four weeks ended 3rd October averaged 548. In the nine weeks ending 7th November the average was 705. That arrangement is perfectly legal, and the umpire so held, and there is no doubt as to its legality. But it is very unfair to a system which is compulsory to men in other trades, and it is a system which, if adopted on anything like a large scale will, I say again, render bankrupt any system of unemployment insurance.


I have heard this statement made recently by the Prime Minister. I want to find out if the Unemployment Insurance Fund would be saved if, instead of having the unemployment distributed among all the workers, you had 500 men idle all the time.


The deduction I draw is that it must be unfair that any system of unemployment insurance should in the same week give benefit to a man who is earning £4 7s., because it is violating the very first principle of insurance and making it impossible for the scheme to work at all.


The whole case against the unemployed which is being made by all parties here, rests on this very point; it is very important. The suggestion presumably is that, instead of having 1,300 men sharing work at the Cardiff docks, 500 should be rendered permanently unemployed and, presumably, draw full benefit because they are unemployed, and give all the work available at the Cardiff docks to the other 800.


That is not the point I am making. My point is that—


The real quarrel is that the fellows are getting £4. Is that too much?


I am not saying that it is too much, but I am saying they should not be entitled to benefit in the same week.


Certainly, they would not be entitled to benefit if the National Insurance Fund was a Poor Law relief scheme, but it is an insurance scheme, and, just as I am entitled to insurance for my motor car if an accident happens, whether I am wealthy or poor, so these fellows are entitled to benefit.


Our complaint is that this scheme at the moment is often little more than a Poor Law relief scheme. I do not think any hon. Member in the House believe that when our system of unemployment insurance was started it was ever intended that money should be paid out in the circumstances I have stated.


It was paid out the other day.


I am not going to take up much more time on this point, but I should like hon. Members to know what I think ought to be done for those who are not getting benefit out of the Fund. It seems to me that it cannot be contemplated for a moment that those not getting money from the Fund should be put back on the rates. I hope that will never be the policy of any party; it would be quite impossible in these days, with distressed areas and great local burdens, and for other reasons. It seems to me also to be clear with regard to those drawing unemployment insurance for which they have not paid, that a flat rate of benefit is quite unsuitable and that whatever authority is made responsible—


The hon. Gentleman is now discussing the question whether the rates of benefit are suitable or not. I have already ruled that matter out.


I will leave it at once at that, and say that the flat rate is unsuitable and that I agree with what the President of the Board of Education said on this point on a very similar discussion the other night. It has been suggested that we should set up a new ad hoc authority between the public assistance committee and the unemployment exchange. I am satisfied, after giving the very best care and attention to the matter, that the appointment of an ad hoc authority to deal with those who are not in insurance would merely result in overlapping, duplication and unnecessary expense, and might result in very unfair discrimination between man and man. The fourth thing I can see is that it is quite obvious that the greater portion of the burden of the expense must inevitably be borne by the Exchequer. If that be so, the Chancellor of the Exchequer and every hon. Member is bound to agree with me that you can- not give large sums of money to the local authorities without some Treasury control as to expenditure. No Chancellor of the Exchequer would agree to that, and, while the actual administration of the moneys should be worked through the public assistance committees, which alone have the requisite local machinery for individual investigation, the necessary measure of Treasury control should be secured through the appointment of regional commissioners by the Government.


The hon. Gentleman is now suggesting new legislation. This is a request for £10,000,000 more to carry on existing legislation.


I was endeavouring to assist the right hon. Lady, but I will not pursue it further. There are already unmistakable signs, both amongst employers and employed, that they will not willingly go on indefinitely paying large contributions when they see others getting exactly the same benefit and exactly the same rates who have to pay practically nothing at all, and we think it is undesirable that this present situation should be contained for a single unnecessary day. We believe it is ruinous to the Exchequer, it is bringing the whole insurance system into contempt and it is demoralising a very large section of the people.


I will bear strictly in mind the directions that you, Mr. Young, have given to the Committee as to the limits within which the discussion must be confined, but even though we might succeed in keeping it within those narrow limits, which no doubt are proper, it still raises a very serious question on which I should like to say a few words. No serious person in any part of the Committee or outside could possibly consider the present position of unemployment, and the present figures on the live register, with any desire to deal with this matter in a captious or party spirit, and I do not take very much interest in the question, to which my hon. Friend incidentally referred, as to the date of the first Act of Parliament that began to lead us down the slippery slope. He votes for 1930, which is the right hon. Lady's year. [Interruption.] I think 1927 was the year in which we first had established by Statute this idea of transi- tional benefit. I can well understand the hon. Member opposite being willing to go back further, even to the year 1920. But I do not mind about that because here we are. I strongly feel that the seriousness of these occasions, on which from time to time the Minister of Labour, who is for the moment in charge, asks for a further Vote of this character, tends to be very much dulled by repetition. I have taken the trouble to take out the dates in order that we may realise that we are going through a performance which at intervals we have gone through a great many times before. In November, 1920, when the present extended scheme may be regarded as coming in, the Insurance Fund had a surplus of some £22,500,000. Let us see what is the story since then. What is the history of the growth of these so-called borrowing powers? In March, 1921, authority was obtained to borrow up to £10,000,000, in July, 1921, to borrow up to £20,000,000, in April, 1922, to borrow up to £30,000,000, in 1928 to borrow up to £40,000,000, in April, 1930, to borrow up to £50,000,000, in July, 1930, to borrow up to £60,000,000, and now here we are asking far authority to borrow up to £70,000,000. I think we are justified in saying that, whatever else it is, it is an operation which by its constant repetition tends not to attract the attention it really deserves, and it is becoming a farce and an absurdity to call this process a process of authorising a loan.

We are all familiar with the case, often a genuine case, often a sad case, of someone who comes to us having had a hard time and appeals for a little temporary assistance, and everyone knows that when these cases happen the poor fellow nearly always says, just as much if it is a genuine case as if it is a fraudulent case: "I do not want you to give it me; I want you to lend it me." Some people the first time are touched, in more senses than one, but, as a matter of fact, we all know that even in the most genuine case the best thing to do is, while respecting as far as we can the feelings of the unfortunate, to realise that, as far as we are concerned, we have made a contribution which we shall not see again. After all, if this Applicant comes in March, 1921, July, 1921, April, 1922, 1928 and 1930 and each time says," I only want a little more loan; I assure you it is only borrowing, and the day will come when I hope to pay you back," no one can believe it for five minutes. The real truth of the matter is that, while we come forward on these occasions and vote these amounts, we are not really engaged in authorising some temporary advance by the Treasury to the Fund. We are recognising that the Fund cannot go on unless it gets this additional subsidy. If it had been on one occasion, the first occasion, the situation would be very much like that of an otherwise well-managed and well-organised concern which, for some reason, needs temporary accommodation and goes to the bank, and the bank, knowing its record and reputation for business management, meets it at once. But that is because you really look forward to the day soon coming when you will not only be back to the normal but to something better than normal, so that you will be able to pay back out of times exceptionally good that which you have to borrow when times are exceptionally bad. The Committee and the country at large would be very well advised if, whatever language is used in the question that you, Mr. Young, put, we all avowed openly and publicly that this is not a loan at all, and that there is not the slightest chance of the money ever being paid back out of the Fund and, consequently, it is necessarily an additional subsidy and grant from the public revenue. I do not think this Fund, called upon as it is now, is likely to be able to pay back £70,000,000 in the lifetime of anyone in the House. It is a great pity to speak as though this was merely an advance.

There is a second point. The Unemployment Insurance (No. 2) Bill was presented to the House just over a year ago on the declared basis that the authorities were proceeding upon estimates of the extent of unemployment which were declared to be a figures of 1,200,000 on the live register for the three years 1929-30, 1930-31, 1931-32. I am not going to call anyone to answer because the estimate was mistaken, but we must face the fact that in truth we were invited only 12 months ago to make provision on that very basis. It was not to the Members of the present administration an unreasonable one because, at the time they took office in June, 1929, the figure was something like 1,112,000. At the time to which I am referring, November of last year, it was 1,150,000. Explain it as you may, the fact is that we have to face a figure on 17th November last of 2,286,000. In those circumstances, it is manifest that something will have to be done besides coming at intervals to ask for an increased grant of £10,000,000 as a loan and, while I have a great admiration for the courage which the right hon. Lady has shown in more than one particular in dealing with her very heavy task—she is entitled to have acknowledgment of that from the House generally—at the same time, coming at this time of day, just at the particular moment when the money must be found—at the beginning of December to say, "Now I think I should like to announce a Royal Commission."—I cannot regard that as being an adequate and sufficient explanation of why we have come to this point without something more having been done. The hon. Baronet who has just sat down referred to recommendations that were made last July. It would have been very much better to set up a Royal Commission last July if you were not going to make effective use of your three-party committee. As a matter of fact, it goes back further than that. I should like to read a short passage from a speech by my right hon. Friend the Member for Darwen (Sir H. Samuel) in the debate on 3rd February last. There is more than one aspect of the unemployment question to which the House of Commons ought to give even more attention than it has yet done. The first is this. Is there not a danger that the very measures which the country has taken to relieve the effects of unemployment, most necessary measures as they are, might not be in some degree perpetuating the causes of it? I mean our insurance schemes, which I believe to be right in principle and right in the main in their operation. Is it the case that our insurance schemes are tending to immobilise labour, to stop its fluidity, to prevent it adapting itself to the changed conditions of industry? Is it the case that workmen who wish to find temporary employment in occupations other than their own are afraid of doing so for fear of being penalised by losing their rights to unemployment benefit in their own trade? I do not know whether it is so. I make the inquiry. Is it the case that employers, when trade is not at its best, are tempted, and almost invited, by our system of unemployment insurance to stop their works for a few days at a time and to throw upon the whole community the burden of maintaining their workmen meanwhile? These things appear to me to need examination."—[OFFICIAL REPORT, 3rd February, 1930; cols. 1578-9, Vol. 234.] And so they did, as anybody who considered the subject was able to conclude last February. The right hon. Lady says, "It is true I am only appointing a Royal Commission now; it is true that have only just mentioned the name of the Chairman, but I am sure it will be one of those Royal Commissions which is going to hurry up and that it will have finished its work, or some of its work, very important parts of its work, by the end of March and I hope that it will all be done by the end of the Session." We hope that it will, and I am sure that the right hon. Lady has said this after very carefully surveying the field. I would point out if she is able to call into being an instrument which operates with this rapidity, that if she had only called it into being some six or seven months ago, the work would have been done now. It is a matter of great regret, if I may be excused for saying so, that it is not until the Government have to come to this Committee to ask for a vote of £10,000,000 to save this Fund from being unable to meet claims upon it during the next few weeks, that we are told that there is going to be a Royal Commission.

The right hon. Lady at Question Time mentioned the name of the gentleman who had been asked to be the Chairman. I hope that I may be allowed to say, as one who remembers him very well, that, of course, it will be a most admirable selection. Mr. Holman Gregory was a Member of this House for some four years. He was the Member for South Derbyshire, and he is known to many of us, both inside and outside the House, as a man who has a real interest in this class of problem and has very great qualities for conducting such an inquiry. I should like to congratulate the right hon. Lady upon having secured his services. But however good he is, the fact still remains that to announce the Commission now really means offering the House of Commons and the country an excuse, an explanation on which you may hope to float this Vote successfully through when, as it seems to me, there would have been very good reasons indeed why the matter might have been dealt with much more vigorously before.

There is one other point. The right hon. Lady, in the course of her speech—whether strictly within or without the Rules of Order, I will not inquire—made some observations as to the ill-founded nature of some criticisms which had been made about the abuse of unemployment benefit and referred, I think, to a communication from a farmer in North-amptonshire and an extravagant statement—for it was nothing else—of a journalist. It is very important that these things should be made plain, but I think that the right hon. Lady would not be giving the Committee the full view, which I am sure she desires to give, of the present state of information if she confines herself to correcting, in very reasonable terms, some extravagances and mistakes which she has noticed in the Press. There is published—I looked at it this morning—a document which is called the "Ministry of Labour Gazette" issued with authority from her own Department. I have here the "Ministry of Labour Gazette" for November, 1930. Let the Committee observe. There has been unquestionably a very widespread impression—and there is no doubt the Royal Commission might investigate it—that under the existing scheme, within the letter of the law as far as I know, a good many people, both men and women, are drawing benefit as if they were really then and there wanting work, when for one reason or another they are people who really have ended their employment and do not really mean to return to it. For instance, it has been said—all of us have heard such things, and we naturally want to know the truth—that there are many women who were working, very likely, up to their marriage. When they get married they are not really meaning to work any longer, but, having got their card and stamps, and so on, are sometimes tempted within the law to take up a position as though they did mean to work. Here is this publication issued by the right hon. Lady's own Department within the last few days. I wish to ask the leave of the Committee to read two passages from page 39. My point is, if the Committee will be good enough to follow me, that whether this is within the law or without the law, you do not need a Royal Commission to find it out. This is what this very careful report says, after referring to the Unemployment Insurance Act, which came into force in March, 1930: There is also good reason for believing that whether as a result of the operation of the new Act or as the result of the depression in trade during the present year, a considerable number of persons are now claiming unemployment benefit upon leaving employment, who formerly would not have done so. In the next column they say: It may be computed that if the average rate of exit experienced during the three years1925 to 1928 had continued during the subsequent two years while the numbers of new entrants remained the same, there would have been passed out of the insurance scheme approximately 185,000 males and 130,000 females who are now included in the figures for July, 1930. I thought that when the right hon. Lady said just now in her speech that she was going to deal with the "Manchester Guardian," she was not going to refer, not to some letter in the paper, but to the comment on this which that very careful newspaper made editorially or, at any rate, in its authorised articles. I notice that the "Manchester Guardian" has called attention to this matter within the last few days. It points out that if the statements in these documents are well-founded—and they come from the Ministry of Labour—there appears to be something over 300,000 people who, the Ministry of Labour say—gathering it from the statistics and calculations which they can best make—appear to be making claims as though they were really continuing, desiring to work quite contrary to the average rate of exit, and in circumstances which stem to show that they are now claiming unemployment benefit although they have left employment. Leaving employment there does not mean being out of work. It means giving up a position, whatever it may be, and not to go on working. If it be true, for example, that a number of people who have been working, let us say, as hotel workers, women who have served in the watering-places at times of the year when there are crowds and who get themselves quite properly classed as hotel workers, are not trying to go on working, they are not entitled to get benefit. [An HON. MEMBER: "They are not getting it."] I am not so sure. At any rate, my point is, that I find it very difficult to believe that this great Department which looks so carefully and fairly at these subjects, the Department over which the right hon. Lady presides is so destitute of authenticated information that it has to wait for a Royal Commission before it can make proposals.

My last point I make with some hesitation, because I know that it is a hard thing to say. I do not mean it hardly, but. I feel it, and I think that it is the duty of somebody in the House of Commons to say it. Are you not beginning to be afraid that there is developing among a section of our own population a different view as regards relief from public funds, when, unfortunately, they are out of work? I am absolutely with the rest of the Committee in the desire that they should be helped in all genuine and necessitous cases. But if you once find people over a long period of years learning the clever way in which within the law they can make this claim and that claim—[interruption]—whether they are employers or whether they are workpeople—[An HON. MEMBER: "Lawyers!"] I assure hon. Gentlemen opposite I do not say this because I thought that they would like it. I say it because I think that it is true. Is it not a very serious thing to consider whether you really ought to allow a system, which may, for all I know, be misused in classes of case to be continued to be supported without legislation being brought forward to amend it? If it is true, you are not merely imposing more burdens upon the finances of the State. You are doing a far more serious thing; you are keeping up a system which may, here and there, actually lead, for a section of the population, to what I recollect the right hon. Gentleman the Member for Bow and Bromley (Mr. Lansbury) boldly called "the actual deterioration of character."


What about the Duke of Westminster and the Cutty Sark?


I submit that it is very desirable— [Interruption]—I do not do it with any desire to provoke anybody at all, but I submit that it is very desirable, not only on financial grounds, that we should have these matters looked into and dealt with as soon as possible, but it is also extremely desirable on another ground, which is even more important—[interruption.] If hon. Gentlemen opposite, or same of them, appear to be annoyed at my saying so now, I still think it is the duty of us all to try to correct it.


I paid close attention to the significance of the last few remarks of the right hon. and learned Gentleman the Member for Spen Valley (Sir J. Simon) when he asked, Was it true that we were really beginning to be afraid? I would ask Members opposite, Were they afraid in the Coalition Government of 1920 when they put on to the Statute Book an Insurance Act which clearly stated that persons then unemployed who could prove that they had been employed at some time or other in a trade, then included in the 1920 Act, would nevertheless be entitled to benefit? On this Vote for a further £10,000,000 to assist the Fund in its difficulties, we have a right to ask, Who was it that first declared that you cannot have an Unemployment Insurance Fund actuarially sound if you intend to deal with an abnormal state of affairs? Those who broke the actuarial status and made borrowing powers necessary were the Coalition Government of 1920. Was it because you were then afraid, not beginning to be afraid but actually afraid? It was because you were actually afraid.


I can quite understand that the hon. Member's remarks are addressed collectively and not personally, but as I was not in the House at that time and was not in the Coalition Government, his remarks cannot be applied to me personally.


That reinforces my argument, and I express wonderment that the right hon. and learned Member, instead of addressing his question to the Labour benches, and asking us, "Is it because you are beginning to be afraid?" did not put that question to his own party and to the Tory party, can say: "We are confronted with the present state of affairs because we were afraid in 1920." During 1921 you were confronted with a more serious aspect from the financial side than confronted the country during 1930. You not only broke the basis of insurance, you not only included many hundreds of thousands who had not a stamp credit to their account, but you also scrapped the out-of-work donation scheme and assumed Government liability for about 300,000 ex-service men. That was in 1921. You said: "Since we have broken the basis of insurance, since we have taken £22,500,000 of the surplus that accrued from the real insurance, we will use the £22,500,000 to meet the obligations with which we are now faced, by putting on the Fund those who have no stamp qualifications, and we will also escape direct Government responsibility for paying out-of-work donations and allowances to dependants of the ex-service men at present out of work. We will put them also on the Fund."

In addition to using the £22,500,000, you borrowed £20,000,000 during 1921, and now because there is a repercussion in regard to unemployment insurance, believing that the people have forgotten, or as you would conveniently like to forget your own attitude, you criticise the action of the present Government on this Vote. You cannot go back on your past action and say of the circumstances of this year, and in relation to the £10,000,000 that it has suddenly dawned upon you that it is immoral to pay unemployment benefit to persons other than those who can satisfy a given stamp qualification, when you yourselves 10 years ago robbed the Insurance Fund of £22,500,000 and borrowed £20,000,000 from the Exchequer. When in 1920-21 you borrowed £20,000,000, are we to be told that you deliberately set out to take from the Exchequer £20,000,000 without the intention of paying it back, or looking upon it as a loan? You know that in. the Act you provided that the contributions should remain at their high level until such time as the Fund was again solvent, and that the contributions should remain at that level until the debt had been paid back. In 1921 you had about the same number of unemployed that we have to-day. The figure was round about 2,500,000. There was no cavilling then. The men had just come hack from the War, and the industrial workers had been promised a great deal. They were disappointed at the light estimate of their value after they had gone through the horrors of the War, and you felt that you could not afford to have 2,500,000 people without any income. It was not about the morals of insurance that you were troubling then, it was how to appease these people. You appeased them then, and now you hope that, after 10 years, they will have become more passive, more capable of being dumb-driven.

We have heard something about those who have left insurable employment, ostensibly without any notion of ever coming back to it again, and it is suggested that they may not be as assiduous in their desire for casual or other forms of employment as they might be. You were afraid of the position in 1921. You realised that whilst there was bread going into the homes of the people they would not be the ready victims of the avaricious employer who was desirous of cutting down wages and of using them as they have been used in years gone by. Now you are confronted with a position where you say there are 300,000 people who will not satisfy any stamp qualification, and a three-party conference has been called on the subject. That conference ought never to have been conceded. The Government ought to have dealt with the problems, having regard to the way in which the Government of the past dealt with the same problems. The arguments used in those days could be used from these benches to-day in support of this Vote for £10,000,000 to meet our obligations to the out of work people. I hope that I shall he sufficiently reserved in my criticisms to be fair and reasonable upon the facts, but there is something that causes the uttermost suspicion in my mind. What was the purpose of the three-party discussions? To lop off and to save the Fund: to put it on an actuarial basis.


The hon. Member must not proceed any further on that line of argument.


Why should the other man refer to it?


The Chairman is quite right. What is the purpose of the Royal Commission? Under its Terms of Reference it can mean nothing but striking off many people. If there are 300,000 people who cannot supply the stamp qualification, I would not send them to the Public Assistance Committee and I would not let the Public Assistance authorities, in conjunction with the Treasury, who would make substantial contributions, have anything to say as to how the money should be administered. The purpose of the Royal Commission is to strike people from the Fund, to put a mark upon them, to indicate to the employers: "These are unemployable. They are not normally liable to be employed in an insurable occupation." They are to have the mark of Cain upon them. No assistance is to be given them; they are to have no help from the Unemployment Insurance Fund. They are to be something in between.


The untouchables.


I will never lend my voice to that proposal. The right hon. Gentleman called attention to a statement in the "Labour Gazette." Reference has been made to married women. On the Morris Committee we heard evidence as to that, and whilst one or two felt that where a woman was obliged to give up employment upon marriage, it was considered that she would not seek to enter the labour market again. But who can live in London or in any big industrial provincial town or city without realising that the married woman is available for employment in order to augment the family income which is insufficient either by reason of the low wages or the short time worked by her husband? The evidence that we had was that in London the married woman did not give up the intention of returning to work. She was very often forced back. Are you going to say that, having subscribed from the age of 16 to the age of 23 or 24, upon marriage these women are to be put out of any benefit for which they have subscribed during eight years? Are you going to say that, notwithstanding the fact that the husband may be an invalid and that many of these women may be compelled to seek work, they are not to enjoy benefit, because married women are supposed to look upon marriage as their future life and means of livelihood. I wish it were possible for every adult man who marries a woman to have sufficient pluck and fight in him to get in return for his labour a sufficient wage to enable him to keep his wife without the necessity of her going out to work. Unfortunately, that is not the position, and the married woman often must compete, and she is there competing.

6.0 p.m.

On this Vote for a further £10,000,000 the Minister of Labour has no apologies to make. There has been no more call for money this year than in 1921, and who can say that the circumstances are not as bad as they were in 1921? In 1921 the Government of the day made benefit open to those who had never contributed, and to-day the Government say: "We must have £10,000,000 or there will be no pay for those who have at some time or other established a stamp qualification, but who by reason of long periods of unemployment, if the full standard were imposed, would not he able to establish a claim." Who is going to say that? We have heard about the extension of the transitional period. If the Royal Commission or the Government think of saving an extra Government grant to carry over the 300,000 transitional period people, I would ask them to remember that there must he between 50,000 and 60,000 of those people who are miners, and who have been out of employment for the past two years. If you are going to save the Fund and put it on an actuarial basis—


Other hon. Members will endeavour to follow the example of the hon. Member. I understand that the case of those who are out of work and come under transitional benefit arrangements do not constitute a charge on this Vote.


Not a charge on this Vote, but it will emerge on the financial side from the survey of the Royal Commission.


That may be; but this £10,000,000 does not apply to them.


We are told that this additional £10,000,000 is necessary because the Fund is carrying people who ought not to be on it; that if it was an actuarially sound scheme the class of cases to which reference has already been made would not be on it, and there would be no need for this additional money. The Fund would be self supporting. That is the whole gravamen of the argument on the other side. If it is not so then this £10,000,000 is for the purpose of making payments to those persons who are entitled to receive benefit, and in that case I cannot understand why hon. Members continue to talk about people being artful dodgers, scroungers and cunning folk. We had the Barnes Committee, with Terms of Reference in 1920, the Blanesburgh Committee with Terms of Reference and the Morris Committee with Terms of Reference, all of which enabled an inquiry to be made on the lines which are now suggested. We have had inquiries before into rumours about abuses, and you have a Department which, I believe, takes a 10 per cent. sample of the cases in order to see to what extent these abuses exist. I have said more than once that it does not amount to more than one-half of 1 per cent.; but supposing it is 1 per cent., or 2 per cent., are you going at this stage, after 10 years, to alter the basis of contribution which was arrived at in 1920 by a Coalition Government, not by a Labour Government?

If a Labour Government had been in existence in 1920 they would have accepted the basis suggested by the British Trade Unions and the Labour party itself of a non-contributory scheme, because it is the obligation of the State to assist these people in times of stress. You did that in 1921 because you were afraid. I ask the Government not to be timid at the present time and to expect this £10,000,000, and if needs be to make an application for another £10,000,000. We are at the period of the year when much lip service will be paid to "peace on earth, goodwill towards men." Why should there be this vendetta against the unfortunate unemployed man. The longer he is out of work the greater the penalties inflicted upon him, the more difficult his position. On the top of that a great State says that because there are some who are getting something to which they are not entitled they must screw up the operation of the Act. I hope the Committee will grant the £10,000,000 and that the Government will not apologise for asking for it. The nation ought more or less to be ashamed of the circumstances which make it possible for 2,250,000 people, the best of the land, to be denied the right to work, and to that ought not to be added a denial by an Act of Parliament of the right to live.


By a rather curious coincidence on Thursday next the House will be discussing the Expiring Laws Continuance Act which comes to us once a year. This afternoon we are discussing the expiring benefit continuance Act, which unfortunately comes to us not once but three or four times a year. This is almost the only point on which I agree with the hon. Member for Nottingham West (Mr. Hayday). He expects that a further Measure will be necessary in the near future for more borrowing powers. I am surprised at the moderation of the Minister of Labour. We have had already three Measures of this kind this year; and I do not understand why she keeps on making bites at the cherry and only asks for £10,000,000 when, on her own showing, in February or March next, unless something most unexpectedly takes place, she will have to ask for a further £10,000,000. Why she only asks for £10,000,000 is a surprise to me. She rather suggested that there would be an interim report from the Royal Commission which was announced only to-day, although promised five weeks ago. If the setting up of the Royal Commission takes five weeks what possible chance is there of having any report on which the Government can take action before this £10,000,000 expires in March or early April. It is unsafe, I know, to prophesy in matters of unemployment insurance but I venture to prophesy that almost the first business when we meet again at the end of January or in February will be for the right hon. Lady to ask for a further £10,000,000, and she will say that the Royal Commission has not yet reported and is not expected to report for some time.

It is important for the Committee to realise that in addition to this expenditure of £10,000,000, making the total indebtedness £70,000,000, that there is also the £22,000,000 which the right hon. Lady has said is the charge upon the Exchequer during the current year. In the last administration we tried to keep as even as we could the one-third contribution of the State, the employer and the employed. At the present time, the employer and employed contribute £14,000,000. The right hon. Lady has given the total of our expenditure as being £100,000,000. In other words in stead of the State finding one-third the State is finding £72,000,000, or well over two-thirds, an increase of between £50,000,000 and £60,000,000 over the expenditure during the last administration. When the Chancellor of the Exchequer introduced his Budget this year he said, in what I thought was rather an excess of financial pedantry, that we had run into debt to the tune of £15,000,000 on the Sinking Fund, and as he was a financial purist he insisted that this amount should be repaid spread over the next two or three years. What is his position on this extra borrowing of £50,000,000; ten times as much as he insisted on being put back each year into the Sinking Fund. At the same time he authorises the Minister of Labour to incur an expenditure of £30,000,000 or £40,000,000 in addition to the £22,000,000 required for transitional benefits. I should very much like to get to the heart of the Chancellor of the Exchequer on this matter and to know what he thinks of unemployment insurance finance pursued by his own Government. Of course, we shall never do that.

Let me say a word or two as to how the money is being spent. The hon. Member for Rushcliffe (Sir H. Betterton) has quoted from a memorandum published about a year ago on the financial effect of certain Amendments to the Unemployment Insurance Act, 1929, but his case was even stronger than he put it. He said that the statement with regard to the danger to the Fund from the married woman position was made by the Government Actuary. As a matter of fact, it was a statement issued by the Ministry of Labour itself and therefore much stronger than when it comes from an outside authority like the Government Actuary, who only added the footnote to the effect that as far as he could see the data were correct. The Ministry of Labour, in act, prophesied a year ago the very dangers to which the hon. Member for Rushcliffe and the right hon. and learned Member for Spen Valley (Sir J. Simon) has called attention to this afternoon with regard to married women and seasonal workers. The "Ministry of Labour Gazette" for October last gives a report of the analysis of the samples taken out for the three party conference which has been such a dismal failure. What struck me in that report was the extraordinary increase in the numbers of married women between. February and May. The point is that in February the new Act was not in force, in May it was in operation. The figures are 19,000 and 21,000 in the case of single women and 19,000 and 45,000 in the case of married women. They were more than doubled. This shows at once that married women must be coming into benefit who in the ordinary course of events are not really in the insurance field.

I agree that in Lancashire there are a large number of married women who are out of work through no fault of their own and for whom work would be available in normal times. They are entitled to benefit. In answer to a question of mine the Minister of Labour said that in part that is true of Lancashire and the cotton trade, but as regards the rest there is no question that this extra money which we are asked to vote is caused by an increase in the number of married women who are not entitled to benefit. In their leaflet the Ministry of Labour say that they are coming into benefit and ought not to be admitted. Surely that in itself is a sufficient condemnation of the action of the Government.

My hon. Friend the Member for Rushcliffe quoted Sir Lewis Lougher in reference to the position with regard to the dockers in Cardiff. I have here an extract from the "Times" of 16th September dealing with a somewhat similar point. It is headed "Welsh Anomaly," "Benefit for Well-paid Workers" and it refers to the case of workers in the British Guest, Keen, and Baldwin's Iron and Steel Company, Cardiff where, it is stated, Forty per cent. of the men get £5 for 2½ nights work out of the five nights and for the balance of the week, unworked, they claim unemployment pay which is duly handed out to them. I quite agree that it may be legal but I would borrow a phrase of the right hon. Lady the Minister and say that it is "a legal abuse." That is the only term for it. We know that there are legal abuses in connection with other matters and this House spent a lot of time in stiffening up the Finance Acts in order to stop legal abuses by wealthy men who ought to know better, trying to get away with their Income Tax liabilities.

Notice taken that 40 Members were not present; Committee counted, and 40 Members being present,


With regard to the South Wales question, the same extract states that inquiries show that in Swansea, Newport and Port Talbot there are highly paid casual workers who can earn comparatively large sums by working two or three days a week, and qualify for unemployment benefit in respect of the rest of the week. That certainly seems to be a legal abuse of the unemployment system. Incidentally, I cannot help wondering whether the Chancellor of the Exchequer has his eye upon these individuals because, on the figures which I have mentioned, it would appear that every unmarried man among them is liable to Income Tax, and, clearly, unemployment benefit ought to be included in their Income Tax returns. Can one imagine anything more farcical than the position of people who are liable to Income Tax being paid unemployment benefit? They are drawing £5 or £6 a week and unemployment benefit and are then paying Income Tax on the amount of the so-called dole. It is really a reductio ad absurdum and shows the extent to which the insurance system has got away from its original purpose.


Can the hon. Gentleman prove it?


If the hon. Member had been paying attention, he would know that the right hon. Lady herself has practically admitted that something of the sort is the case. The name of a responsible person has been given, and I have quoted a statement from a responsible paper, which the hon. Member can see for himself if he wishes.


Give us your authority.


I have quoted from the "Times" of 16th September this year, which the hon. Member will find in the Library if he cares to look it up.


It once published a forgery.


All I can say to that is, that a forgery of that sort would soon be shown up. I am sure that the right hon. Lady would have been able to expose it, if there had been anything of the kind in this case, and we may take it that there is a very large amount of foundation in fact for the statements which have been made. We all want to get unemployment insurance on to a sound financial basis, but we on this side think that the Government have been playing with the question and that they are continuing to play with it in setting up a Royal Commission and in asking for a further £10,000,000, which, on their own showing, will only last for two or three months. Whether in the meantime they are going to ride for a fall in the political sense and leave this matter to their successors I do not know, but I almost suspect that such is their desire. I read an article by the Prime Minister in the "Labour Magazine" for October, in which the right hon. Gentleman, referring to schemes of public work started since the Government came into office, says: I doubt if people even yet realise the extent to which useful schemes of public work which will provide employment have been stimulated since we came into office. In times like these, all the work on these lines that is possible cannot make any dramatic impression on the unemployment figures. If an increase of 1,000,000 in a year and a-half is not a dramatic impression on the unemployment figures, goodness knows what is. I only hope that in the near future the right hon. Gentleman not satisfied with that dramatic impression, does not make a still further increase—in which case £10,000,000 will not go very far and the Government will be coming to Parliament in February or even sooner for another £10,000,000. I shall vote for the Amendment because I do not think that the Government have shown their fitness to spend the money wisely.


I do not propose to go into the ethics of this question or into the technicalities involved in the issue of whether this loan is to be granted or not. My only object in rising is to deal with what was a most extraordinary speech as coming from the legal mind of the right hon. and learned Gentleman the Member for Spen Valley (Sir J. Simon). It has been my privilege, in the course of a somewhat varied career, to have been associated with the right hon. Gentleman in the primitive stage of his legal experience in the middle of the 'nineties, and I have watched his career with great interest since that time. The right hon. Gentle- man's legal ability and his brilliance and his achievements in the law are well known, but in all my experience and in all my study, I confess that I never came across a more peculiar argument than that which was embodied in his speech this evening. He puts the Minister of Labour in the dock not only for her own alleged sins, but for those of the Opposition, because, on his own admission, more than one-half of these loans for unemployment benefit have been granted since the period when he himself returned to this House. I have been sitting here since his return in 1922, and on no occasion have I ever heard him protest when one loan and another loan, and still another loan, for the relief of the unemployed were being granted. But what still more peculiar about this speech was that he produced no evidence whatever, even from his own point of view, against the right hon. Lady and her Department. More than that, he frankly admitted that the right hon. Lady, whatever her faults might be in this respect, was acting within the law.

What a peculiar position for a lawyer to take up! I always understood that nobody could be convicted in our courts of law—indeed that nobody was regarded as guilty in the eyes of the law—unless proved guilty. Yet the right hon. and learned Gentleman produced no title of evidence against the Minister except some quotations from the "Ministry of Labour Gazette" and if there is anything at all in legal phraseology there is not the slightest foundation for his case. The right hon. Gentleman referred to the fact that there were so many claims, but I always understood that there was a great difference between a claim and the actual granting of the claim, and no proof of any kind was produced by the right hon. Gentleman as to whether any of these claims had been successful or not. He asks us how long is this state of affairs to go on, but is not that the question with which the right hon. Lady the Minister is endeavouring to deal? Is not this inquiry being set up for the purpose of finding out how long it will go on? Surely the absence of facts in the right hon. Gentleman's own speech to-night is in itself a justification for having a further inquiry into this matter. I submit that the position taken up by the right hon. Gentleman of arraigning the Ministry here and then admitting himself that they are acting within the law is a most peculiar position to be taken up by any lawyer and by any man with common sense either in this House or in any other place. The logical or rather illogical and, in fact illegal argument of the right hon. Gentleman seems to be that persons who even legally abuse the law should be illegally deprived of their legal right.


If I may follow up what has been said by the hon. Member for St. Helens (Mr. Sexton) I submit that the right hon. and learned Gentleman the Member for Spen Valley (Sir J. Simon) was not arguing that numbers of unemployed were drawing benefit who ought not to do so. He was arguing that the law which permitted them to do so, was wrong and he blamed the Government for not altering the law. Whether my reading of his speech is right or not I do not say but that is what I gathered from his remarks. The right hon. Gentleman said that sooner or later something would have to be done and he argued that it ought to be done before this money is voted. I think it is time that the House of Commons called a halt to the "rake's progress" which is going on month after month and which is exemplified in this Financial Resolution. I wish to protest against what I consider to be not only the waste of money but the waste of Parliamentary time involved in having these debates month after month. I would remind the Committee that this is the fifth Unemployment Insurance Measure of a Government which has been in office under two years.

I wish to give some reasons why I think we must call a halt to the perpetual voting of these additional sums. First of all, dealing with the question of the waste of money, nothing said on the other side can alter the fact that the unemployment insurance scheme was started as a genuine insurance scheme, to which a man contributed and from which when out of work, he received benefit as a result of his contributions provided that he was genuinely in the insurance field—that is if he was a genuine worker liable to come into industry again. Anything which has arisen later on—and it has arisen under all Governments—has been the result of not keeping strictly to the original rule. This scheme was never meant to become a relief scheme. Whether some system of relief for people who do not come into insurance should be introduced or not is a matter for debate but when the unemployment insurance scheme was started, the idea of using it as a relief scheme was never present to the minds of those who initiated it.

To understand fully what has happened and why we are continually brought to this House and asked to vote loan after loan of £10,000,000, it is necessary to go, very briefly indeed, into the financial history of the scheme. The scheme was started in a small way in 1911 and extended in 1916, and in 1916 it had a balance in hand of £15,000,000 odd. Then, in 1918-19, immediately after the War, came the out-of-work donation, which was given to ex-service men and certain munition workers, quite separate from the unemployment insurance scheme and with no stamp qualification whatsoever. That out-of-work donation cost some £66,000,000. It did not come out of the Insurance Fund, but men who were qualified under the unemployment insurance scheme and also under the out-of-work donation scheme could draw either, and as the out-of-work donation was higher, they nearly always naturally drew that. The result was that the Unemployment Insurance Fund benefited, as a number of people who would otherwise have drawn from it took the out-of-work donation and therefore came at that period off the Insurance Fund. At the end of 1919 therefore the balance in hand had increased to £22,000,000. So far so good, as regards the actual finance of the scheme.

In 1920 an Act was passed extending unemployment insurance to cover practically the whole industrial field, and it brought in some 11,750,000 workers. Then came the industrial slump, but even then, had the first principle been adhered to, the Fund, with a balance of £22,000,000, would have been able to withstand it without any further borrowing, but, as the hon. Member for West Nottingham (Mr. Hayday) said, we had uncovenanted benefit brought in by the Coalition, and it was this bringing in of people from outside who were not entitled that originally started the borrowing and caused the present financial position of the Fund. The uncovenanted benefit, as it was then called, was brought in, by which people who had not got the necessary stamp qualification were entitled to draw benefit in advance, the Government hoping that in the end they would square up their contributions with the benefits which they had received. Owing to that, the balance disappeared, and borrowing began, and ever since then, year after year, the borrowing has gone on, £10,000,000 at a time, right up to the present day, when we are asked to borrow up to £70,000,000.

I want the Committee to realise that that was the commencement of the borrowing. The thing that put the whole insurance scheme out of gear was when the uncovenanted benefit was started by the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) and the Coalition Government, when they once allowed themselves to depart from the insurance system and to bring in uncovenanted benefit and thereby some system of relief.

The next date on which I might touch is 1924, when the first Socialist Government was in office. Then the word "uncovenanted" was changed to "extended," and it was called extended benefit; otherwise, it was exactly the same, and the system went on. Then, in 1926, we had the Blanesburgh Report, and in 1927 the Government of that day passed an Unemployment Insurance Act, framed on the Blanesburgh Report, under which extended benefit was to disappear. That is an important point, but so had were things at that time, that the Government decided to continue it for a little longer under what was called the transitional period. That period has gone on to this very day. I am aware that under the 1930 Act of the present Government everybody who was covered by the transitional Section was financed directly from the Treasury, and therefore these people do not arise under the £10,000,000 which we are asked to vote to-day. The Government decided to take them out of the Unemployment Insurance Fund and to pay them direct from the Treasury.

I want the Committee to realise that in that same Act of 1930 so many changes were made in the administration of unemployment insurance that at present it is very difficult indeed to distinguish between those who are genuinely in the insurance field and those who are not, and many of us on this side maintain that the reason for the very quick time in which the Government have had to come again for a further £10,000,000 is the cost of the 1930 Act, which finally, I think we may say, cut clean away from any idea of unemployment insurance and put masses of people on to the Unemployment Insurance Fund who really ought to 'be included in some type of relief scheme. Some of the Sections, as the right hon. Lady has pointed out, including that under which a man need no longer look for work, have added enormous numbers to the register and have also released a flood of claims on the Fund which were never contemplated when the Act was started. The right hon. Lady herself told us that the sum necessary for the new people coming under the 1930 Act, the people who, I say, come under the Section with regard to not genuinely seeking work, and people of that description, was £5,300,000 and for those married women, &c., put in a different category £3,250,000, so that it shows that an enormous number of people have come on as a result of that Act who ought not to be on the scheme, in my view, though some hon. Members may differ.

I want the Committee to realise what is happening now, and I think I can best show that by reading two extracts from the Press, which are rather interesting, because they are from the "Times" newspaper of Friday, which I happened to pick up on the very day on which we heard that this debate was to take place. It is to show the sort of mentality which is arising as a result of the present attitude of the Government that I read these extracts, the first of which is headed "Unemployed girls who refuse service." I will read one sentence: The umpire's decision against the payment of insurance benefit to unemployed mill girls who refuse domestic service at seaside resorts during the season has aroused widespread protests in the Lancashire textile unions. Then it mentions that a number of hon. Members opposite are having a deputation, including the right hon. Gentleman the Secretary of State for War. I mention that to show that there is a protest from hon. Members opposite when people are refused benefit who refuse to take a job of work. In my view, that is wrong, and I am protesting against it.

The SECRETARY of STATE for WAR (Mr. T. Shaw)

I do not think the hon. and gallant Member ought to use my name as being a member of the deputation until he is satisfied of the truth of the statement.

Captain HUDSON

I will continue to read the extract: The Great Harwood weavers' committee last night decided to bring the matter before Parliament with a view to amending regulations being introduced by Messrs. T. Shaw, M.P., J. Tout, M.P., and M. Brothers, M.P., all prominent textile officials. I apologise for mentioning the right hon. Gentleman's name in reading an extract. The other article, which I picked up at the same time, is headed, "Abuse of the 'dole'". It reads as follows: The National Federation of Retail Fruiterers, Florists, and Fishmongers has drawn the attention of the Minister of Labour to an abuse of unemployment insurance involved in the growing practice in the trade of cheapening working costs by employing casual labour (maintained for the rest of the week by unemployment benefit) to meet the business requirements of the week-end, and to rely at other times on the services of a skeleton staff. In giving these two cases, as showing what is arising in the administration and in the spending of the Unemployment Insurance Fund—which will have to be very seriously considered by the Government and which, I say, should have been considered some time ago—I am well aware that the last case that I mentioned, namely, that of subsidising wages, has taken place under the previous Governments, but in these bad times it has become worse, and undoubtedly something will have to be done about it very soon indeed.

There is another abuse, or rather attitude of mind, which has lately arisen and which hon. Members opposite must have had brought to their notice. Time and again, when a job is offered to a man, he reckons up how much more the wages he would receive would be than his unemployment benefit. He does not say that a job is one of £2 a week; he says it is only 5s., or 10s.. or whatever it may be more than he would get on the dole, and I am certain that that is a wrong attitude to adopt and one that nobody wants the working man of this country to adopt. I therefore hope we shall get down to a proper insurance system, which would entirely do away with the possibility of anything like that happening.

I said that, besides being a waste of money, the continuous bringing forward of these Bills is a waste of time. Every time that an Unemployment Insurance Bill is brought forward in this House, it has to go through the same stages—the Money Resolution, the Report stage of the Money Resolution, and then the Second Reading and all the other stages of the Bill itself—and when one thinks that this is the fifth Bill that the present Government have brought in, including the large Bill of last year, one realises what a tremendous amount of time has been spent in this way. When I was listening to the two last speakers on the back benches opposite, I thought there was a good deal of truth in many things which they said, but at the same time I wondered if they were content with what is happening. They offered no alternative. Do they want us to go on in February, and probably again in July of next year, as on the last three times in this House, voting £10,000,000, with no end ever in sight?

We hoped that the three-party Committee would lead to something permanent being done. That has been thrown to the ground, and now a Royal Commission has been set up, but I am afraid that that again will waste time, and that another Bill, if not two or even more, will have to be brought forward. The only way is to refuse to vote this money, in order to make the Government hurry up and decide for themselves. It seems that some of the party opposite want the present state of affairs to go on. I was much struck by a remark made by the President of the Board of Education when we were dealing with another form of granting money, that of maintenance allowances. When an hon. Member of this side asked him whether any foreign country went in for such assistance, he said that he was proud to think that this country was starting a system of that kind. I can tell him and Members opposite who like the present insurance system, that we are rapidly becoming the laughing stock of the world in carrying on in the way in which we are doing. I hope that we shall to-night take a first step along a new and a saner path towards stability and common sense.


No Member of the Committee enjoys the idea of asking for £10,000,000 in order to carry on an insurance scheme to provide money to enable the unemployed to live. Every one would prefer to see every unemployed man in work receiving substantial wages. We do not enjoy the idea of asking for £10,000,000 in order to enable millions of our fellow men to continue living at home. We regret the need for it, as much as any Member on the other side. I was surprised to hear the hon. and gallant Member for North Hackney (Captain. Hudson) say that to discuss this question is a waste of time—

Captain HUDSON

I said that continually to discuss it, and to have five unemployment Bills in a year and a half is a waste of time.


I agree, if the original provision had been adequate, but it is not waste of time to discuss this Resolution in view of the fact that the first Bill did not make adequate provision. It cannot be suggested that it is a waste of time for us to discuss ways and means of providing something for the 2,000,000 unemployed to live on. Nor is it a waste of money, for it is money well spent. The late Parliamentary Secretary to the Ministry of Labour put forward only one reason why he cannot support this Resolution. The reason was that the necessity for it is the outcome of the policy of the present Government, and that the Act passed last year has increased the financial burden by bringing in people who otherwise would have been kept out. As a Conservative, the hon. Gentleman quite rightly says that the continuance of Conservative policy would have been better for the country, and that the not genuinely seeking work condition ought to have continued to operate. Let him ask the hon. Member for Leith (Mr. E. Brown) whether it ought to have continued. If the hon. Member for Rushcliffe (Sir H. Betterton) would read some of the hon. Member's speeches, he would find how inhumanely and harshly the condition was operating.

It is true that the repeal of that condition has increased the financial burden. It was intended to do so, for it was intended to provide benefit to people who had been refused it because of the operation of that condition. We do not argue that the absence of that condition has not increased the financial burden. If that condition had remained under Tory legislation there might not have been need for this Money Resolution to-day, but that is not an argument against its being removed. It is an argument for making it difficult for unemployed people to get benefit. I recently asked the Minister of Health the difference between the amount of Poor Law relief which was paid at the end of February and that which was paid at the end of October. He tells me that £250,000 has been saved in Poor Law relief. The men and women who had been receiving that relief as a result of the operation of the 1929 Act, now receive Unemployment Benefit.

Then we are told by the hon. Member for Rushcliffe that we have to consider intermittent work, and short time, and he gave as an example Cardiff and Plymouth, where 1,300 trimmers arrange their work so that each man gets some of the work and work roughly two clays a week, as a result of which they all qualify for Unemployment Benefit. Does the hon. Member suggest that one-third or more of those men should be stopped altogether, and that they should receive Unemployment Benefit continuously? That is the only alternative to part-time work. I agree that some of them earn good wages in that part-time, but it is not possible to say that this man shall qualify for Insurance Benefit because his earnings are so much, and that that man shall not because his earnings are larger. Under an insurance scheme, if it is to be fair and reasonable, every contributor, if he complies with the conditions, should receive benefit. The same conditions operated when the Conservative party were in Office. In the mining industry we get a good deal of intermittent unemployment, Many of our people work two or three days a week. Some receive £2 for three days, and others receive £1 for three days. Is it suggested that those who receive £2 shall not obtain the benefit, and that those who receive £1 shall get it? If that were done, the system would break down.

What are we going to do? If we have a scheme which lowers the cost by removing some people off the Fund, where are they going? They have got to live. This Fund is unable to continue paying Unemployment Benefit much longer, and therefore the Minister asks for £10,000,000 more in order to continue paying the Benefit. The only question we have to ask as regards abuses is, Is there anyone anywhere receiving Benefit who is not entitled to receive it? "Yes," says the right hon. Member for Spen Valley (Sir J. Simon), "there is." Cases are quoted of married women, but are we going to say to them that because they are married, they shall not have the Benefit? A case was referred to by the Minister of Labour of a married woman, where there was evidence to prove that she had left industry and did not intend to return, but merely took advantage of an Act passed by the present Government. Is that the kind of case which is regarded as an abuse? In Lancashire there are thousands of married women who do not work every day, and they qualify for Unemployment Benefit. Nobody can say that they are not entitled to it. Their husbands are also insured and qualifying for Benefit. If we are to have a real insurance scheme, these people have to qualify. In my Division there are far more unemployed than in the Division of the hon. Member for East Lewisham (Sir A. Pownall); we have 25 per cent. unemployed. I have gone round the Division many times, having heard of cases of abuse, and after investigating them, I have never been able to find a single case.

If there are cases of abuse, an inquiry commission should deal with them, and hon. Members should not read extracts from the "Times" or "Manchester Guardian," and say "There is your evidence." That is not satisfactory evidence with which to prove a case. If there is abuse, let us find it out, but we must be careful that we do not make things far worse by precipitate action. We say that this money should be voted, firstly, because the unemployed need the money; secondly, because it is in the interests of this country that they should get the money; and thirdly, because this country can afford it. Can anyone deny that the unemployed need the money, or that it is in the interests of this country in the larger sense that they should get the money, or that a country like this can afford to pay the paltry amount which is now being paid. Abuses should be investigated, and if it is possible to find people who are not entitled to the benefit, the money should be stopped, but the only safe course at the moment is for the House to grant the Financial Resolution.

7.0 p.m.


I listened with interest and a great deal of agreement to much of the speech of the hon. Member for Ince (Mr. G. Macdonald). I cannot, however, feel that any of the arguments which he has put forward in any way excuse the Government for being so long in setting up the Royal Commission. In none of his words did he bring out an argument which could justify the delay of months during which the present state of affairs has been going on, or the five weeks which have elapsed since the setting up of the Royal Commission was announced. I cannot imagine that there is any feeling of optimism in the mind of the Minister of Labour when she faces the present situation. I can only suppose that the feeling is a sort of laissez faire philosophy—"third time lucky, and may things go better in future." Otherwise, she would not come here and make the speech she has made to-day, because undoubtedly this Bill is not justified in the light of the genuine insured worker or the unemployed at the present time. When you read "Unemployment Insurance" on the title of this Bill, it is an insult to the intelligence of the readers and to the intelligence of those workers, whether employed or totally unemployed, who are geneuinely bearing their burden in the Unemployment Insurance Fund on an actuarial basis.

The present situation is also a threat to the position of the genuinely insured worker in this country, and, for that reason, the vast majority of insured workers in this country would like to see it remedied. They can justifiably ask themselves the question: "Where do we stand? Are we participants in a debased form of insurance which may crack at a change of Government? Are we in some false edifice, the foundations of which may crack or blow up, or are we members of a definitely sound insurance scheme from which we are entitled to draw benefits by way of insurance?" That is a question which a man temporarily out of employment may well ask himself at the present moment. Those who are not in employment and have failed to contribute the necessary number of stamps must also ask themselves whether they are hangers on to an insurance system which is debasing and prostituting every principle of insurance or whether they are to be members of something different, a form of State unemployment relief.

I know it is not a popular doctrine to put forward, but I would like to see this insurance scheme broken up and divided in such a way as to put it on a sound actuarial basis without shirking the issue of a State unemployment relief scheme. It is not derogatory to the unemployed to do this, and one can make it something which a man can pass out of again after he has the necessary number of stamps and has thus qualified by a term of employment to re-enter the normal insurance scheme. I am convinced that the vast majority of the unemployed—and I know them well in my own constituency and my own concerns—are splendid people, as good as the majority of Members of this House. The right lion Member for Spen Valley (Sir J. Simon) took a very small minority question and, upon that very small basis, proceeded to build up a condemnation of the whole system.


If the hon. and gallant Member will allow me to say so, I did nothing of the kind. Perhaps he did not follow what I was saying. I have been interested in the whole scheme for years past, and all I did was to point out that some suspicions of abuse were already known to the Ministry of Labour and, therefore, there seemed no reason why the appointment of the Royal Commission should be postponed until to-day.


I am sorry if I misinterpreted the right hon, and learned Gentleman. There is a tendency abroad—and it is always easy to go with the tide in politics and everything else—to say that the dole is abused and to try to build up through newspapers with which I have no sympathy at all, the popular penny Press, an idea that there is an enormous amount of abuse of the unemployment insurance system going on at present. I am convinced there is not, but unfortunately there are abuses going on. I would divide those abuses into two different classes, the legal and the illegal. The legal abuses are such cases as that of the Cardiff workers referred to by the hon. Member for Ince (Mr. G. Macdonald). There are employers who are running their works on the system of turning men off and taking them on again at carefully regulated times so as to enable them to draw unemployment benefit. It is wrong that such legal abuses should be allowed in an insurance system.

There is a great deal to be said for a system of subsidised wages during industrial depression. Hon. Members opposite do not agree, but there are ways in which it might be done which might give employment and might enable us to recapture some of our foreign trade. If such a system were introduced, I would divorce it entirely from the insurance scheme and would bring such a system as that of the Cardiff workers into this system of subsidy of wages which would be carried out from a special grant. It could be linked up with the second scheme to which I referred of State unemployment relief, but should have nothing to do with an actuarially sound unemployment insurance scheme.

The illegal abuses exist at the present time, and every Member, whatever his party, should be willing to lend his hand and voice to put down irregular, illegal abuse of the unemployment insurance scheme. There undoubtedly are and always will be people in every community who are shirkers and slackers, and it is no use blinking the fact. There are slackers in every community, and, if any Member denies that in 2,2.50,000 unemployed there are those who are shirking, they are mentally deceiving themselves or trying to deceive those to whom they are talking when they put forward those views. Although mine is not an industrial constituency, nevertheless the percentage of unemployment is 20. There are two Employment Exchanges, and in one there are 1,400 and in the other 1,320 unemployed. Since the court of referees was set up, I have taken a considerable amount of trouble in investigating the number of cases, in which I consider, as an ordinary man in the street, abuses have occurred. I have found that they have undoubtedly been a very small proportion indeed, and one on which J would fear to build up any definite structure of general condemnation of the unemployed in this country. In my constituency I have a very large number of women.

The right hon. and learned Member for Spen Valley mentioned the questions of watering places and of those employed in hotel service. There is much to be said for investigation into the hotel and boarding-house service, and I believe that a Government inquiry might help to industrialise our boarding-house and hotel system to a degree that would not only benefit those concerned in the industry but would benefit the industry itself and consequently the country. As to the point I put forward, whether we might have some form of State relief scheme by which the dead wood would be cut away from the insurance scheme, leaving it actuarially sound, I visualise such a scheme as one of subsidy of wages and which men would pass out of after a definite period of employment. Such a scheme should be considered in relation to relief in kind. I have recently been in Birmingham, where the unemployment figures are heavy and where rickets is prevalent among the children, but—


The hon. and gallant Member would not be in order in discussing that subject; otherwise, there would be unlimited discussion.


In any scheme of relief there should be some possibility of seeing that the duty of the State, which is to see that any money expended is expended in the wisest possible way for the benefit of those concerned, is carried out. Lastly, as to repayment: What are we doing to-day? The right hon. and gallant Member for Spen Valley asked what were the prospects of this Fund ever becoming solvent? Not with this load of debt hanging over its head. I hope the Parliamentary Secretary will give us some forecast as to the future and tell us whether there is to be a repayment, or whether one day a Chancellor of the Exchequer will come down to the House and say: "We cannot go on. Industry is better, and the Fund can pay its way, but the taxpayer must bear the past burden." That is a question to be answered to-night if the Government are to live up to their responsibility. The Government are living on a credit that does not exist in this country; they are living on the credit which they think they have got in the country. The Minister of Labour said in her speech on the last occasion: It is not for me to say what the future position will be in regard to unemployment, but, as a trustee of the Fund, I think it is the duty of the Minister to take such precautions as will ensure that the Fund is in a position to meet the calls which may be made upon it."—[OFFICIAL REPORT, 18th July, 1930; col. 1628, Vol. 241.] The Minister of Labour is rightly a trustee of the Fund, but she is also a trustee of the people whom the present Government are supposed to represent. Instead of speaking from that narrow point of view and saying she was a trustee of the Fund, she should regard her wider trusteeship as a Member of the Government and consider whether she is fulfilling her duties to the taxpayers of this country, the people of this country, and the industry of this country, upon which the future prosperity of the country rests.


The hon. and gallant Member who has just resumed his seat has followed the ordinary lines taken from those benches during this discussion. There was no special point in his speech which had not been put forward by some other Member during the discussion. After hearing so many discussions on unemployment and on unemployment insurance, I do not remember any more depressing than the discussion which is taking place to-day. There seems to be a very general state of anxiety about the Unemployment Insurance Fund. I only wish there were a tithe of the same anxiety with regard to the circumstance of the unemployed as there is with regard to the solvency of the Fund. The Fund is insolvent, but so are the unemployed. In one case it is simply a. question of money, but in the other a question of human life.

The late Parliamentary Secretary to the Ministry of Labour and the right hon. and learned Member for Spen Valley (Sir J. Simon) both adopted a very self-righteous and critical attitude towards the Unemployment Insurance Fund. What the Minister said to-day is obviously true, that so far as the Unemployment Insurance Fund is concerned every party in the House is in the same position. Some members of the Tory party have suggested that a great mistake was made when uncovenanted benefit, or benefit in advance, was introduced. That was done a long time ago, and every Government has had to pursue that policy. In the 1927 Act the Conservative Government, coming forward with proposals based on the Blanesburgh Report, had to introduce the transitional period. They had to do the same as other Governments have had to do, to introduce this side line to insurance, and other Governments will have to do in the future as unemployment increases.

There is a lot of talk about the great necessity of maintaining the insurance principle in connection with unemployment insurance. That is the overriding consideration with a number of people. Never from the beginning, at least never from the beginning of the legislation in 1920, has there been any adherence to the insurance principle. It was departed from in the 1920 Act, and it was only a question of months before a much larger-departure took place; and the increase in the insolvency of the Fund since then is due only to the large increase in the number of the unemployed. The insolvency of the Fund does not arise from legal or illegal abuses. It arises from the overwhelming increase in the numbers of the unemployed of late months. That is what is responsible for the present state of affairs.

The right hon. Member for Spen Valley was even more clever to-day than on previous occasions, and showed himself to be more wonderful in his genius for detection than in the days of the General Strike. He came forward and, with a great air of authority, impugned the Minister of Labour because the Royal Commission was not set up some time ago. The Royal Commission was indicated in the King's Speech. He also based his statement for speedier action, apart from a reference to a general casual inquiry by the right hon. Member for Darwen (Sir H. Samuel), on something in the November issue of the Ministry of Labour Gazette. He picked a statement out of the "Gazette," but evidently did not think it worth his while to examine it fully, because in regard to the 300,000 referred to in that statement as claiming benefit but who might have gone out of insurance, the "Gazette" also indicated that one of the possible reasons why they had remained in benefit was that there was such widespread trade depression. If it was due to trade depression, why was he so fearfully and unctuously self-righteous about the Commission not having been appointed earlier? He would have been on more legitimate ground of criticism if he had said that the three-party committee which the Government were foolish enough to set up might have been allowed to report, so that any suggestions they made could have been acted upon. To base anything on the statement from the "Gazette" was ludicrous, coming from a man skilled in finding the most narrow and particular meaning in sentences, as the right hon. Gentleman always has been.

The late Parliamentary Secretary to the Ministry of Labour has discovered now what he might have discovered when he was in office. His Government had to come forward asking for more money for the Fund because the expectations of his chief and himself with regard to a decrease in the number of the unemployed had not been realised. They based the Act of 1927 on a figure of about 700,000 unemployed, although almost everybody in the House told them they were making the most ridiculous calculation, and it was not long before they also had to ask for an extension of borrowing powers. Then there is the idea that if only what are described as the illegal abuses could be done away with everything would be all right. The hon. and gallant Member for Thanet (Captain Balfour) was anxious about the illegal abuses, about the people who are able to defraud the Fund, but practically everybody else who has contributed to the debate realises that there is not much to be saved in that way.


The point I made was that I recognised that the number of these abuses is very small indeed, in comparison, but that they would not have the support of any Member on any side of the House.


I am quite willing to agree that the hon. and gallant Member said that the number of illegal abuses was very small, but he wishes to have the microscope applied to them. He thought something could be achieved in that way, whereas practically everybody else recognises that any investigation into them will probably cost more than we could save as a result of that investigation. I would rule out that factor altogether, because my experience of the working of unemployment insurance has been that it is easier for a camel to go through the eye of a needle than for a person who is not entitled to it to get unemployment benefit. [An HON. MEMBER: "Question"] The hon. Member may question it, but it is rather late in the day to do so. If he has any real grounds for believing these abuses exist it was his duty as a citizen as well as a Member of this House to acquaint the Minister of Labour with them long before this.

All through there has been a campaign of calumny against the unemployed. There have been the references in the Press, to which the Minister of Labour has referred. I should not be the least bit surprised if Conservative headquarters were behind those letters in the Press, because the silly statements in those letters are sometimes made by hon. Members opposite in referring to this matter. I do not like to hear the unemployed being traduced in this way. It is all very well to say that possibly, as a whole, they are just as fine a body of people as you can get, and, that there is as large a percentage of decent people among them as among the Members of the House. In that case why the necessity to get a microscope to look into the defects of this section? Let hon. Members take the beam out of their own eye. If they did so they might be able to see better when looking into the position of these other people.

I do not think the Royal Commission will he very busily engaged in their inquiry into the illegal abuses. The main part of their work will be devoted to what are called the legal abuses. I am in entire disagreement with what has been said in regard to these legal abuses. A man works for three days and gets unemployment benefit for the remaining three days of the week. Why should he not? It is in accordance with the Act. It may be said that this was not contemplated when unemployment insurance was introduced. I take an entirely contrary view. Unemployment insurance, when first introduced, was applied to only 2.500,000 of the industrial popula- tion, and the industries to which it was applied were specially selected as those in which there was a tendency for men to have to work three days and then take three days off during periodical slumps in trade. I say confidently that since 1920 circumstances have changed, and it has been recognised that the unemployment problem would be of much longer duration. Does any Member of Parliament suggest that if a man is unemployed for three days a week that man should, somehow or other, get along without unemployment benefit? The proper way is to lay down that if a man is unemployed for one day a week the Unemployment Insurance Fund shall provide payment for the day on which he has not been able to obtain work.

The late Parliamentary Secretary to the Minister of Labour unfolded a mass of figures which he told us that he got from a former Member of this House, and he said that he was at liberty to quote them and give the name of the gentleman who had supplied them. We expected a tremendous disclosure, but the only result was that we were told that a section of working people had been obtaining unemployment benefit for three days when they were not unemployed for three days. Is it contended that it would be the best thing for these people always to remain unemployed? If they were out of employment for a whole week, they would draw benefit for six days in the week, and that is the full benefit. Many of those men were in employment for four-and-a-half days a week, and were idle for one-and-a-half days. I would remind hon. Members that those men contribute towards the insurance fund all the time, and they do not get anything at all for the one-and-a-half days. Do hon. Members agree that they should take the contributions of these men without giving them the benefit for the whole of the time. It is ridiculous nonsense to talk in that way. We have been told that some of them are earning £4 a week. They might have been Members of Parliament getting £8 a week, and my view is that those men working three-and-half days for are doing a lot more for their money than those who are getting £8 a week in this House. Why should those hon. Members, who are getting £8 a week in this House, criti- cise those who are getting unemployment benefit for three days. It is quite true there is no means test.


Why not reduce the salaries of Members of Parliament?


One of my complaints is that the Government have not reduced by a great increase in the Income Tax the salaries of those Members of Parliament who can well afford a reduction. I am sorry that this interruption has led me astray, but I will not pursue it any further. We are advocating nothing which is contrary to the insurance principle, and I am surprised that the Government have been led into this difficulty. It has already been shown that in the case of seasonal workers very little can be saved. Then there is the ease of married women about which there has been a tremendous "how-do-you-do." If the men had been getting sufficient wages, the women would not need to go out to work. The married women are there when work is to be obtained, and when at work they are under the insurance scheme and contribute to it, and therefore they are entitled to unemployment benefit when they are out of work.

It seems to me that we should be very much more profitably employed if, instead of setting up a Royal Commission to inquire into the working of the Insurance Act, we set up a Royal Commission to inquire into the direction of our industries, because the problem with which we are faced now in connection with unemployment is not due to the Insurance Fund not being properly worked, but to the fact that the direction of industry is inefficient. That is what causes such a tremendous volume of unemployment. That is the real point to which we ought to direct our attention. Let me put it in this way. There is a very strong insurance society in this country called the Prudential Insurance Company, but, if there happened to be a plague in this country, and the people insured in that company began to die off in great numbers—if the death-rate was doubled or trebled, then the Prudential Insurance Company would be in the same position as this Fund, and it would not he able to meet its liabilities. If there came a plague, or something which threw out of order completely the tables on which the insurance premiums were based, there is not an insurance company or a society in this country that would be able to stand the strain—not one. All sound profitable concerns are based on normality, and, if things became absolutely abnormal, then your companies would go and your insurance principle would disappear. That is the position with regard to the Unemployment Insurance Fund, and that is why the Government are entitled to come to Parliament and ask for more money. That is the obvious thing for the Government to do.

I am in favour of a proposal that when unemployment reaches a certain figure automatically the State should contribute so much more to provide for the increased number of unemployed. The Government are now asking for an additional £10,000,000 and they are taken to task and accused of striking at the insurance principle. The last Act of Parliament has nothing whatever to do with the increased insolvency of this Fund. Why do hon. Members not realise that the increase of unemployment has contributed three or four times more to this difficulty than the addition which has been created by the alteration of the Insurance Act. Is there any hon. Member of this House who would suggest at this time the imposition of the not genuinely seeking work clause, and apply it to these cases? Do hon. Members wish that provision to be reimposed? If they do not, then I hold that many of the arguments which have been used to-day are quite irrelevant to the issue.

The Insurance Act was passed in 1920, and at that time there was £22,500,000 in the Fund. That was all taken and spread over the number of people who came on to the Fund. In 1922, the Ministry of Labour had to come to the. House and ask for increased borrowing powers. but in 1924 the debt of the Fond had gone down by nearly £5,000,000 when the last Labour Government were in office. Then a. Conservative Government came in and the debt went up to £38,000,000. My view is that the Government are wrong in appointing a Royal Commission, and that they ought to make sufficient provision for the unemployed and to increase the amount of the benefit. We do not want a Royal Commission to look into this question, and the Government should have announced the improvements they intend to make and the changes which they think are necessary to bring in the people who are still left out of insurance. There are many people who should be getting unemployment benefit who are not now getting it, and who are not able to get through the meshes which surround the working of the Insurance Act. That would have been a much sounder policy for the Government to adopt.

It fills me with disgust to hear hon. Members reminding us of the proceedings of the Blanesburgh Committee. We do not need another Royal Commission to try and find some way of making the Insurance Fund sound. Obviously, the idea is that there should be a segregation of the unemployed into two parts, but any attempt to segregate the unemployed will meet with unrelenting opposition from many Members in this House. We are not going to have it said, "Keep your Insurance Fund solvent, and let the other people come into some scheme of unemployment relief. We must have the Unemployment Insurance scheme a solvent scheme." You are not going to save anything by such a segregation, because, I take it, you are not going to propose less for the one section than far the other. I put that question to those who have been advocating this segregation, and have been saying, "Let us keep certain statutory conditions, which must be observed in every case, and then, so far as those statutory conditions are observed, we shall be able to have an arithmetically sound scheme, and we will have this other section of the unemployed that is outside it when they cannot observe those statutory conditions. They can go into this new grouping."

I want the late Parliamentary Secretary to the Ministry of Labour to get his colleagues who speak with authority from the Front Opposition Bench to tell us if they are going to have less benefit for those people whom they propose to put into this new grouping. Are they going to be in a poorer position? Will they have to satisfy different conditions before they will be allowed to qualify for obtaining the payment which is under consideration? I would like an answer to that question. I am sure that the Members of the Committee would like an answer to that question. I am sure that all the Members of the Labour party would like the responsible spokesmen of the Conservative party to make it plain to-day whether they are proposing that there shall be different scales of benefits, or whether they are going to reduce those benefits to the unemployed. The unemployed in the country are entitled to know that; the people in employment are entitled to know that; every member of the working class is entitled to know that; and I challenge the spokesmen from the Front Opposition Bench to tell us definitely whether they can give us the assurance that the present benefit will not be reduced.

I want also an assurance from the Liberal party. I know that many of them would take a similar point of view to ours, that these benefits should not be reduced, but, evidently, with success and all the rest of it, the right hon. Gentleman the Member for Spen Valley seems to get more and more narrow in his viewpoint as to what other people ought to have. As he himself gets more, he seems to think the pay for everybody else should be less. I believe that this debate will be of very great importance if we can get some more information on this matter, and I hope that the Government will yet take up a different position, that they will face up to this fact.

The Minister was very anxious to assure everyone, but, while I listened to her, I thought that she seemed to be seeking to reassure the Primrose League, the people who write those letters to the newspapers, and those Tory correspondents who are always inventing stories about the unemployed. The assurance that the working people of this country are wanting from the Government is that more is going to be done for the working class, that there is going to be a great increase of expenditure in improving the standard of life of the working class; and I ask the Government, I ask the Minister of Labour, to show a far firmer front, to scrutinise very carefully the administration, and see that every unemployed person gets the benefit that he is entitled to, and is not allowed to be deprived of it, as is the case now, as the Minister knows from the cases that are sent to her by Members of this House. That is a far better line to take. Never mind seeking to reassure hon. Gentlemen opposite. The more you try to reassure them, the more they will try to humiliate the Government and Members on this side of the House. I plead for a great boldness of policy, and I would ask the Government, in view of this debate, in view of the statements of the hon. Member opposite, and in view of the fact that there can be no substantiation of any real abuses as indicated here to-day, to throw overboard the idea of a Royal Commission on this matter, and to set up a Royal Commission to find ways and means of improving the standard of life of the people.


The hon. Gentleman who has just sat down referred to this debate as a depressing one, but we have been debating a depressing subject; the subject of unemployment is not a very cheerful one for anybody. At the same time, the hon. Member rather takes it upon himself to suggest that the party to which he belongs is the party which represents the unemployed people in this country. I personally take very great exception to that—


I only meant to suggest that we represent the unemployed who are not paid a lot of money; I do not suggest that we represent the unemployed who live on rents, interest and profit.


I still stick to what I said before. The only observation that I have to make on that remark is that the hon. Member's party have done extraordinarily well in adding to the unemployed in the last 18 months. Our objection to this Resolution is that we know perfectly well that the borrowing, or raising, or whatever it may be called, of millions of money does not touch the fringe of the unemployment problem. We have to-day over 2,000,000 unemployed. In the very near future, whatever hon. Gentlemen opposite may hope or wish for, we are going to have, probably, a very much larger number of unemployed, and, as I have said, this Resolution does not touch the subject at all. On the contrary, I contend that every penny piece which is raised in this way has to be raised out of the State—it has to come out of the pockets of industry, and that includes the pockets of the wage-earners. That simply means that with every penny that you raise, more unemployment will result. That is what we have been doing for the last 18 months.

During this debate, various observations have been made on the matter of legal abuses by employers and employed. I happen to know that these abuses—and they are abuses—are widespread. Certain examples have been given at Cardiff and elsewhere, but I can assure hon. Members that they do not exist in Cardiff only, but are widespread throughout the country; and I say we have asked for them. The legislation which we have passed, and the borrowing of money to-day, will simply encourage such abuses, and, therefore, we come to this position: We are dealing to-day with an Unemployment Insurance Fund, not with a fund for the subsidising of industry or anything of that kind, and, therefore, because it is an Unemployment Insurance Fund, I take exception to those abuses. I am perfectly willing to agree that, if we are going to tackle the unemployment problem as it stands to-day, we shall probably have to bring into operation some other scheme to subsidise or help industry in some way, but this is not the way to do it. This Fund was never meant for this purpose, and, therefore, we have no right to permit it to be carried on in this way. I personally would much rather see these abuses, and see men kept at the work which they understand and have been brought up to do, than see them put on the dole, or whatever it may be called; but this fund was not created or intended for that purpose, and, therefore, we have a right in this House to take exception to its being done.

There is no doubt that, if we are to tackle this problem of unemployment, we shall have to tackle it in a different way from merely borrowing money on the basis on which it is now being borrowed, and has been borrowed for the last 10 years. We have now to face facts, and I always have a great deal of sympathy for whoever happens to hold the post of Minister of Labour. He or she comes in for a great deal of unpleasantness from both sides of the House, and I have very great sympathy with the right hon. Lady who holds that position to-day. The right hon. Lady is fighting the propaganda of her party as much as anything else. "Work or Maintenance" has been one of the cries of her party for many years. Now, for the first time, that party has to face the facts, and those facts are that we have a rising tide of unemployment, and the Fund is not only in debt, but is so bankrupt that it will never be otherwise than bankrupt under present conditions. To talk of borrowing £10,000,000 is an absolute farce. We know perfectly well that this money will never be paid back—


It is a good investment; you get interest on it.

8.0 p.m.

Major TH0MAS

If the hon. Gentleman thinks it is a good form of investment to put people on what I will call the dole, because to my mind what is paid in unemployment benefit is not sufficient to be called a wage—if the hon. Gentleman thinks that that is a good investment, I say that he has done extraordinarily well during the last 18 months. The time has come, however, when the question of unemployment must be considered in a practical manner. First of all, there is the question of insurance pure and simple, and the Insurance Fund should be placed at the earliest possible moment on a proper basis. Then there is the question of relief for the unemployed, which is an entirely different thing, and is not insurance at all. I am perfectly willing to agree that that should be dealt with from a national point of view. Further, I would like hon. Members opposite to consider the question of, if I may so put it, insurance for employment, and not for unemployment. These abuses which are being carried on at the present time are carried on by means of money which has been subscribed for unemployment insurance. That money has been subscribed to unemployment insurance, and I suggest that that question should be considered very carefully.

Notice taken that 40 Members were not present; Committee counted, and 40 M embers being present—


Although there is apparently less interest taken in this question than one would expect, I do hope that something of practical value may be done. I think we shall have to leave aside, if I may say so, our political theories and look at this question from a new point of view altogether, made a suggestion to the House the other day which I believe would have kept a certain number of people in employment. The men I referred to are now out of a job and on unemployment pay. I suggest that the question of subsidising industry out of the money that is now being spent in outdoor relief, or unemployment relief, ought to be seriously considered by the House. If we are to get our people back to employment we can only do it in one way, by getting them back into jobs which they understand. [An HON. MEMBER: "A magician!"] If we require magicians to solve our problem we will have to give it up altogether. We are only human beings, and we will have to face it in a practical way and not in a political way.

This whole question is now being shelved on to a Royal Commission. That Commission ought to have been appointed months ago. If it had been, there would have been a report from it months ago and, probably, this Money Resolution would not have been before the House. No one can tell when the Commission is to start operations and when they are to report. After that, what chance is there of the Government accepting the recommendations in that report Very little. I presume by that time we shall have very nearly 3,000,000 unemployed. The majority of us were elected on the question of unemployment and I do not think that any of us can be very happy about the situation. If we think we can solve or mitigate unemployment by merely borrowing money for a bankrupt fund and a bankrupt policy on a bankrupt basis, all I can say is that the country expects better of us. I shall be exceedingly glad to hear from the Government spokesman that, when the Royal Commission submits its report, this House will have an opportunity to debate it.

Lieut.-Commander KENWORTHY

The hon. and gallant Gentleman who has just sat down had some caustic things to say about our slogan "Work or maintenance." But that is the practice in the profession which he once adorned. In the military profession that is exactly what is carried on; there is work or maintenance. It does not apply to the profession that I once had the honour to. belong to, because it has to work all the time whether there is war or not; but in the Army they have to make work in. peace time to keep the soldiers fit. That is what we would do in the Socialist State; we would keep the citizens fit by sports, etc., if there was no work for them. I thank the hon. and gallant Gentleman for one kind thing which he said. He said the Labour party during the last 18 months had done very well for the unemployed. I would ask the right hon. Lady the Minister of Labour to make sure that that statement is blazoned in her room and that it figures in her election address when the election comes in. two or three year's time. When the hon and gallant Gentleman talks about subsidising industry he is only saying that private enterprise in this country is bankrupt and that this method of ours is the only one by which we can carry on meantime.

It is perfectly useless for the hon. Member for Rushcliffe (Sir H. Betterton) and the right hon. Gentleman the Member for Spen Valley (Sir J. Simon) to try to cut down this Vote under present circumstances. You have a system at the present time which cannot deliver the goods or find work for willing workers. This sham fighting on the other side, this appeal to the House to throw men off the Unemployment Insurance Fund and to cut down benefit is all hypocrisy. If hon. Members opposite were sitting on the Government. Bench, they would have to do the same thing, and they know it. If there had been no Unemployment Insurance Fund during the last 10 years there would have been revolution. In these circumstances, all we can hope to do is to see that the Fund is efficiently and humanely administered and wait for the Government's short-term and longterm policies to find work for those men and women who are without it at present.

I hope the Royal Commission is well chosen, and I hope it includes men and women who know what it means to be out of work. Some of those men and women, admirable citizens who have had to go through severe vicissitudes through no fault of their own, ought to sit on that Commission; otherwise I am afraid it will be another Macmillan Commission, or another Blanesburgh Commission, with great respect to my right hon. Friend the Minister of Labour. May I utter one other word of warning? I heard my right hon Friend the Minister of Labour mention the figure of 2,500,000 unemployed, and that the money now being provided would not last through March on those figures. She mentioned 2,500,000 in a natural way and no one protested. It is a dreadful thing that in this House, when such a question is being considered, a count is called and a second count is called a few hours afterwards. I can remember about a year ago when hon. Members opposite were prophesying that the moment the unemployment mark touched 2,000,000 the Government would go out. The hon. and gallant Gentleman who has just sat down talked about 3,000,000, and I was sorry to hear the right hon. Lady the Minister of Labour mention 2,500,000.


I said God forbid!

Lieut.-Commander KENWORTHY

I am not criticising the right hon. Lady; I am criticising this Parliament for looking upon this matter apparently with such composure. I must put in a word for one class of the unemployed—the dockers of whom I have many in my own Division. We have heard the riverside and dockside labourers of Cardiff and Liverpool mentioned. The complaint was that these men work two and three days a week and are able to sign on for unemployment insurance afterwards. Let me inform the House that if the dockers could not draw unemployment insurance money on odd days, when there are no ships for them, they would starve and their families with them, or, if they did not starve, they would be so deteriorated physically that they would lose their strength, and they are a very fine body of men. We have too many men employed at the docks, and everyone knows that. We have more dockers than the docks require. In times of boom they are nearly all employed, but in times of slump there are many thousands who are redundant. That is the fault of the docking and wharfing industry and the railways and shipping companies which employ them. They are casuals. We have been trying to decasualise them for years and what help have we had from the dock and harbour companies and the railway companies? They prefer to have this reservoir of labour, this reserve of men power, that they can draw on and they look to the Unemployment Insurance Fund to keep them in the meantime. It is a horrible system. I repel the attacks that are being made on the men. In my constituency the unemployed are getting like wolves. There are the youngish men, some of whom have served their country in her time of need, who are drawing 17s. a week, and who would jump at any job at £1 a week for the sake of working. They are not lazy, and it is a libel, because here and there and now and then there is a case of abuse, to say that they are in the great majority idle. They are the victims of this system of casual labour.

I hope my right hon. Friend will see that the terms of reference to the Royal Commission will permit of the question of the dockers' work being looked into. Signing on twice a day is still insisted on. They are the only class of workmen who have to sign on twice a day. They sometimes lose a job in consequence. In the East of England a great many agricultural labourers who despair of getting work on the farms again are coming into the ports and swelling the casual labour that is available there. It is difficult for them to get books, but here and there they are able to do it. They are strong, hearty men and they are taken on by the stevedores, and they go on the docks and so into unemployment insurance. One way to prevent that to a certain degree would be to extend unemployment insurance to the agricultural labourers. I rose to refute the suggestion that there is battening on the Fund on the part of dockers and riverside and harbour workers. I speak from personal knowledge of my own constituency, and I know it is the same in other constituencies. If I dare make a constructive proposal, I would suggest that you should place on each industry itself the responsibility for looking after its own unemployed. You would not then have employers standing men off so lightly, knowing that they would get something from the Fund. If every industry were made responsible for looking after its own unemployed, the nation itself looking after those who are definitely forced out of industry, that would be very much better. I hope the Committee will repel the Amendment.


The hon. and gallant Gentleman has made an interesting suggestion, but I do not think it quite arises on this Vote, which is a Vote of money for the insurance scheme. I consider that the hon. and gallant Gentleman has somewhat misconceived the attack that is being made. It is not an attack upon the unemployed. It is not an attack even on those who abuse the Unemployment Fund. It is an attack upon the Government for having at this late hour recognised that there are abuses to be corrected and having taken no steps to direct any attention to the matter. When we had our first Insurance Bill the right hon. Lady mentioned that she had a committee set up in the summer of last year inquiring into the whole system of social insurance. We have had no report—not even an interim report.


That was not a Ministry of Labour Committee, but an inter-departmental committee.


We have heard something to-day from the Minister of Labour. I think it makes it all the more urgent that we should hear what the inter-departmental committee is doing. Many of us have come to the conclusion that, before we go on spending money as we are doing, we ought to have some more constructive effort to grapple with the whole question of social insurance and to put it on a basis which would command the respect not only of the House, but of the contributors, and it seems a little surprising that we have this most important committee adumbrated, 18 months ago, presumably sitting and labouring at its task, and not a word as to any progress being made in the matter. With this committee, the three-party committee, and now a Royal Commission, the country will be forgiven if it forms the impression that the Government are shirking its own responsibilities in the matter and that it ought to have dealt with it on its own initiative much earlier than it has done.

I wish the hon. Member for Camlachie (Mr. Stephen) were in his place, as I should have liked to have said in his presence how much pleasure we all derived from the vigorous address which he gave us. My only criticism on that address in general is that it proceeded on a false basis to this extent, that there seemed to be the assumption running through it, and through many of the speeches which we have heard to-night, that we on this side, in criticising this expenditure of money, are somehow acting in the most skinflintish manner. We have put up to us the sorrows of the unemployed and their great difficulties, and we are asked: "What is £10,000,000?" "We can afford it," and so on. That, of course, begs the whole question that we are discussing. The fact is that we do not consider that this is really helping the unemployed in any way at all. The hon. Member for Camlachie said: "What about the insolvency of the Insurance Fund? After all, the unemployed are insolvent, too." Very true. But does it help the insolvent unemployed man if his only recourse is to the insolvent Insurance Fund? Two wrongs never make a right.

The process does not end with us voting this money. If it was only a question of voting £10,500,000 for the unemployed, and if there was no more in the story than that, this attitude of superior generosity on the part of hon. Members opposite might have some justification in it, but that is not the whole story. When you go a little further and reflect that the £10,500,000 has to come from somewhere before it can be paid over to anyone, we are justified in asking for a little more scrutiny into it. It is bound to come from taxation. There is no conceivable possibility, as far as one can see, that this colossal debt of £70,000,000 will ever be repaid. It is a direct charge on the taxpayer, and the effect of these direct charges on a falling revenue is that the return from them is beginning to shrink.

How can it help the unemployed, whose desire is not unemployment benefit but work, to go on increasing the burden under which our industry is staggering? We ought to do everything we can, not concentrating on giving unemployment benefit but using all our resources so that industry is strengthened and improved and given a chance to provide work. The hon. Gentleman the Member for Camlachie has spoken about our departure from the insurance principle in 1920. There was a departure even earlier than that. I believe that many of our difficulties in insurance matters are due, perhaps necessarily, to the introduction in 1919 of the out-of-work donation. It was a payment which did not pretend to be on an insurance basis at all, and the effect of that donation was to relieve the Insurance Fund proper of a great deal of the load which otherwise would have fallen upon it, as men preferred to draw out-of-work donation because the payments were more generous than insurance benefits. We ought by now to have accumulated enough experience of unemployment insurance, apart from the artificial subvention of the out-of-work donation, to be in a position to re-examine the whole question with a view to putting the Fund upon a proper basis. There are hon. Members who have addressed us who profess no anxiety to put the Fund on to an insurance basis at all. They say, in fact, that it is not insurance, and that if it is out-of-work relief so much the better. I think we shall find few Members in any part of the House who will agree with them. There must be very few of us who would think it a better thing from the point of view of the contributor and from the point of view of the beneficiary, if he had been contributing. Insurance at the present time must necessarily be very difficult.

There is another matter which arises in discussing this question of unemployment insurance. One is often faced with an assumption that one has a right to talk about unemployment as though it varies with the amount of unemployment one finds in his own division. I do not think that that is a proper view to take. It may be, if you have a great deal of unemployment in your own division that the Unemployment Exchange becomes perhaps the largest employer of labour in the division, and there you may get a vested interest quite as powerful as any financial interest can be. You may neglect, or be tempted to neglect, the point of view of one who is, very often, omitted altogether from our consideration on these occasions, namely, the ordinary man who pays in and does not draw out of the Fund. There are two complaints which the ordinary contributor makes concerning the present system. One is the fact that when he may have to go to draw benefit, if the necessity arises, he is placed exactly on the same footing as perhaps someone in his own street whom he knows has not subscribed a penny to the Fund. It is surprising how much feeling is expressed on that matter by men who have of late months been forced to draw unemployment benefit.

Another matter has been put to me several times, and that relates to the case of the man who, under the present system for which we are being asked to vote to-night, has paid in to the insurance scheme since it started and has never received a penny. I have had almost numberless cases brought to my notice. Men feel that it is a great shame that when they, have paid into the Fund year after year, have not missed a week's work, and when they expect at the end of their working days a nice little nest-egg or some credit for their steady contributions, there is not a penny for them. They know where the money has gone. The impression among contributors that there are abuses is widespread. It is not merely the country vicar who writes from some remote hamlet in England and describes some more or less authenticated or imaginary case of his own; it is the ordinary workman in the street. He feels that all is not what it should be with regard to the Insurance Fund and would dearly like to see the problem tackled by more direct and courageous means than by the postponement which is involved in a series of committees, and now in that grand procrastinator of all, a Royal Commission.

It has been said that we ought not to be content to vote for this Motion to-night unless we can somehow or other answer these questions: "Does anybody deny that the unemployed need the money?" The answer, as the occupant of the Front Bench says, is in the negative. "Does anyone deny that it is good for the country that they should have the money?" As to that, the answer also will be in the negative. We think that it would be better for the country if the unemployment system were put on to a better basis, so that the money could be paid without having to resort to this ramshackle slipshod payment of money out of a Fund which is a mixture of out-of-work relief and insurance benefit. It is a question of putting the thing on to a logical basis, and we say that if this were done the unemployed would be better off than they are to-day.

The hon. Member for Camlachie asked what was to happen after the separation took place. He addressed his question to someone in a more exalted position, metaphorically, than I. I would ask the hon. Member to consider this fact. If, as seems to be admitted, all is not well with the Insurance Fund to-day, and by some measure of separation you could improve the position so as to relieve the Insurance Fund proper of the terrific incubus of withdrawals which take place by all the means of which we have heard to-day, would you not put the insured contributor into a possibly better position than he is at the present time? I can see that there is a great deal of wastage in the organisation, or lack of organisation, of our unemployment system to-day, and I believe that by more scientific and more thoughtful organisation it can be put on to a better basis altogether. Can the country afford it? No doubt the country can afford this £10,500,000 when we consider that this £10,500,000 is only another chapter of a long succeeding serial. But, as the right hon. Lady told us to-day, our expenditure on this branch of our nation's activities, or lack of activities, amounts to about £100,000,000 a year, which is almost equal to the whole of our prewar expenditure.


As much as the expenditure on the Army.


When we consider whether the country can afford it, we must answer in the negative unless we are certain that the money is being spent in the most efficient manner possible, and we are not satisfied of that to-day. It is not merely a question relating to the employer, the individual and the taxpayer, but every increase of taxation raises the cost of living to everyone. The whole burden of this and similar Acts does not rest on any small select body of Income Tax or Super-tax payers. The crushing effect of this taxation is so spread that it raises the cost of living and not the standard of living in every home in the country.

On these grounds, I submit that on this occasion, before we agree to adding another straw to the load of the camel, we ought to have a very much clearer statement from the Government as to the proposals and a much clearer statement as to their future intentions with regard to the whole question of unemployment and unemployment insurance. No one denies that this question is very difficult; of course, it is. There is no question that arouses so much feeling in every part of the House as this question. Were it a matter of giving away our own money to help these poor fellows who are out of work, everyone of us would do it, but we shall never tackle this problem until we get rid of the idea that the money we are spending is our own money and we realise that it is the money of other people. What we want to give to the unemployed is not larger and better benefits but work, of which they stand so much in need, and we shall not give them that so long as this wasteful expenditure continues.


I want the Committee to come back to the terms of the Resolution. The Resolution shows that there is no abrogation of the insurance principle. The Fund is in deficit and we require borrowing powers up to £70,000,000 to put it into a workable condition. The £70,000,000 required under these borrowing powers is a measure of our unemployment problem in this country. Hon. and right hon. Members opposite have spoken from time to time as if the present Government were responsible for the accumulation of difficulties which has revolved around this Fund and its administration, and around the problem of unemployment itself. For the great bulk of that deficit and the longest term deficiency period, the former Government were responsible. The Fund was in credit in 1924 when the Labour Government left it, but it had a deficit of £37,000,000 during the term of the Conservative Government. When we consider the difference between the £37,000,000 deficit and the sum of £70,000,000 with which we are now concerned, we have to take into account two very potent factors. There has been an extension of the scope of unemployment insurance and also of benefit since this Government came into Office. The Minister of Labour has given us the figures, which show that under the extended scope of benefit, which has brought in people who were properly entitled to benefit, 180,000 people have come in, at a cost of £15,000,000.

There is nothing in the Resolution which abrogates the insurance principle. As the hon. Member for Camlachie (Mr. Stephen) said, insurance is operating here as much as it would be operating in a big insurance company. Big insurance companies have to assess risks, and they get normal and abnormal periods of experience. The Fund has not been long enough in existence to have anything like a stable insurance experience comparable with that of a large insurance office. Apart from the abnormality of war time experience, we have not had the stable insurance experience on which properly to assess risks and to adjust the contributions. I am not afraid of inquiry into alleged abuses of the present unemployment insurance system. This inquiry is not being approached from the same angle as the previous inquiry. When the former Government saw their unemployment insurance expenditure mounting up and they could not cope with it, they sought ways and means of combing the register. The coming inquiry is not designed to comb the register and to put people out of benefit who are entitled to it, but if there proves to be abuse, either on the part of the insured person or on the part of the employers, it is the duty of this House to put measures into operation to correct the abuse. I am not staggered by the instances of abuse which have been quoted and which are said to come within the law. If we are going to take the risk of paying for three days unemployment in certain industries, we shall have to budget for that risk and make adjustments accordingly.

The Unemployment Insurance Act covers an insurable population of something like 12,000,000 people and it cannot be held to be an abrogation of the insurance principle, because 2,000,000 are on claim. The 12,000,000 people who are not claimants are not bereft of benefit under the Unemployment Insurance Act; indeed, I would be prepared to argue that the insured person who is not a claimant enjoys much greater benefits than the person who is a claimant. People are now beginning to see that the only bulwark between a degradation of the standard of wages and a lowering of the standard of life is the unemployment insurance scheme. Here are these 12,000,000 insured persons under the scheme, protected by the scheme, one-third of the contributions coming from the employed, apart altogether from the one-third paid by the employers, which is also a direct charge upon the employed by an adjustment of wages, and it is wrong to suggest that there is anything in such a scheme which is the antithesis of insurance. I hold that the person who is not a claimant has, nevertheless, as an insured person the benefits of insurance, and probably greater benefits than the person who is a claimant.

This scheme must be maintained. It must benefit by its experience. It must be developed, and I hope the Minister of Labour will come to Parliament for all the money that is required to perfect the scheme rather than take the view of hon. Members opposite, that we have reached an impasse in unemployment insurance, that the whole thing is being degraded into a dole, and that, therefore, we must get back to Poor Law relief. There is nothing in the very abnormal experience of the present to warrant or justify that view. If there is anything wrong with the Unemployment Insurance Act this House should have the wit and capacity to remedy the wrong, but there is no justification for suggesting that because you have had a war, because the capitalist system has failed, because employers are possibly abusing unemployment insurance benefit for the purpose of carrying on industry, that of necessity the Unemployment Insurance Act is wrong and has failed.

We shall take an erroneous view of the situation unless we realise that we are living in abnormal times. £70,000,000 is a fabulous sum, but circumstances abundantly justify it, and even if it was more it would be justified and sustained by the necessity for carrying on a scheme to meet an abnormal situation which is not the creation of the present Government but largely the creation of former Governments. In dealing with the position we have to keep our eye on this outstanding fact, that this is still insurance, not only for the claimant who is drawing an inadequate maintenance allowance but a still greater insurance for the 12,000,000 insured people who, otherwise, would be at the mercy of the employing classes, who would then degrade wages because these people would have no means of expressing their independence.


The optimism of the hon. Member for Greenwich (Mr. Palmer) as to the insurance basis of our present scheme can only be justified on one assumption, and that is that at an early date the number on the unemployment register will drop to 1,250,000. With all respect to him I cannot share his optimism, and I am quite sure that the right hon. Member for Tamworth (Sir A. Steel-Maitland) does not share it either. He and I once had a quarrel about 720,000 people—I will say no more. The fact is that this demand for another £10,000,000 borrowing powers must bring the Committee and the country up against a decision. Whether it will be taken now or in three months' time, or in six months' time, I do not know, but it will have to be taken some time, and that decision is this: whether we can continue a system of dealing with able-bodied unemployed persons in three directions—namely, insurance by contract, relief by status, and relief without status. That is what we do now. I cannot, of course, on this Vote discuss the other two, but I say that if we are to have an insurance system it should be a definite system based upon, contract, we should then know what the contract was, and be able to meet that contract at any time. May I say again that I have never shifted my ground. I have always held that there should be two systems of insurance, an insurance by contract and a national system for the able-bodied unemployed. My reply to the hon. Member for Camlachie Mr. Stephen) is this. If he will read "Labour and the Nation" and the summary of the Labour party's programme, he will find there: The establishment of adequate provision for unemployed workers under the control of a national authority. I take it from his speech that that was just a phrase and meant nothing. At any rate, now that we have the promise of the Government to set up a Royal Commission, we shall have some guidance as to whether there is a scheme in operation. The hon. and gallant Member for North Hackney (Captain Hudson) has referred to the lamentable financial state of affairs, and said that we were the laughing stock of the world. That is an abuse of language, and it is language which is ill-advised. What is the alternative to an insurance scheme and relief for 2,886,000 unemployed? It is the bankruptcy of local authorities, indiscriminate charity, bread lines, social riots, shaken credit and general demoralisation, and that has to be weighed in the balance when we are discussing the figures of un- employed to-day. There is another side to it, and it should not be left out of the discussion when we are dealing frankly and fairly with the facts. The facts, of course, come out in many ways. It is not my duty to repeat the figures which have been given by the Minister and other hon. Members as to the general state of the Fund at the moment, but I want to give one figure which has not been mentioned.

May I remind the Committee that the White Paper issued in July last by the Ministry of Labour gave an interesting table. It showed that the average weekly amount by which outgoings would exceed revenue, without any allowance for interest, on the assumption that 1,500,000 are on the register by the month of March, 1932, would be £130,050 per week; that on an assumed number of 1,700,000 on the register by June, 1931, the sum would be £285,000 a week; that on the assumption of 1,900,000 on the register in March, 1931—the date when the limit of £60,000,000 then asked for would be exhausted and the date which we are now discussing—the average weekly amount by which outgoings would exceed revenue, without allowing for interest, would be £445,000 a week. The figures to-day are very different. We are now discussing a deficit at the average weekly rate, excluding interest, of £630,000, which is £500,000 a week above the first assumption—the assumption that the £60,000,000 borrowing powers would last until June, 1932, and that unemployment would be registered at 1,500,000. On that assumption we would have had £130,000 a week deficit. What is the estimate now? If the unemployment figure remains at 2,200,000 the average excess of outgoings over revenue up to April will be £610,000. If the unemployment figure be 2,500,000, as, alas, it may well be although we sincerely trust not, then the average excess of outgoings over revenue by the middle of March next will be £880,000 a week.

This question is far too serious for mere party scores. It is a great national question to be approached from the point of view of dealing with a grave emergency. I cannot understand the state of mind represented by the speech of the hon. Member opposite. Any man who has any regard for the principle of insurance and any understanding of what the insurance scheme has meant, since 1920, to this country as well as to the unemployed, and who talks, as the hon. Member talked, in that haphazard and easy way, is doing no service to the unemployed, to his own party, or to himself. This is not a matter to be treated in that light way because there is grave public anxiety concerning this question, and this Committee, on all sides, should show itself worthy to face the full implications of the facts.

Let us consider what are the facts. There are facts affecting the finances of the scheme, and there are facts affecting the social structure of which this unemployment insurance scheme is a part. There are facts raising grave issues as to whether or not, unless action be taken, we can rescue unemployment insurance from being degraded in the public mind. In my judgment the greatest disservice that could be done to our workers would be for this great social service, one of the greatest of all time, to become degraded in the public mind as a thing unworthy. I think the hon. Member does the Fund no good service who fails to recognise the gravity of the present situation, both as regards the number on the register and in other respects. As to the number, if there are those on the register who ought not to be there, we should know of it. They ought to be taken off the Fund and dealt with in some other way. There can be no justification for an agricultural worker going on to the Poor Law because he has not insurance status, while somebody else can come in under the transitional provisions of the Unemployment Insurance Acts and receive full benefit without the degradation of being dealt with as a pauper.

There is the other fact that this continuous borrowing cannot go on indefinitely. These figures have given the Ministry a great deal of anxiety. The terms of reference as to the forthcoming inquiry show that to be the case, and it is useless for hon. Members to try to belittle the argument that certain things exist which are not legally wrong, but are wrong from the point of view of any sound unemployment insurance scheme. The decision to appoint the three-party committee on the one hand, and the decision on the other hand to appoint the Royal Commission, have made it clear that, in the minds of those responsible, there are things which require looking into—and grave things.

9.0 p.m.

What are the problems which lead us to face this £70,000,000 deficit, with a potential weekly excess of outgoings over revenue of £880,000 by the end of March, if unemployment rises to the 2,500,000 figure? I agree with the hon. Member who says that it is not merely a question of some individuals being on the dole but of some industries being on the dole—literally. And if any hon. Member opposite objects to that statement let him consider the following passage: Some employers have taken advantage of the scheme in ways which were never contemplated. It is open to argument whether this should be a method by which employers should ease the situation with regard to their wages bill; but if they deliberately plan their work so as to have so many days' work and so many days' unemployment benefit, they are the last people in the world who ought to complain of the increased taxation arising from this source."—[OFFICIAL REPORT, 23rd July, 1930; cols. 2183-2184, Vol. 241.1 Those words were spoken by the Minister. They state the case admirably and I do not think it necessary to add to them except to say that any analysis of the proportions put into the Fund and drawn out of it by one industry as against another, must give all who desire to see an insurance scheme on an insurance basis, furiously to think. Let any hon. Member examine the table of industries in reference to this matter. I do not propose to mention any industry; I content myself by indicating the groups of industries at either extreme, pointing out that between those extremes there are all kinds of variations. We have at the top a group of eight industries containing 1,305,000 workmen; we have a group at the bottom containing 171,000 workers. Analysing the figures from 1925 up to July, 1929, we find that the group of eight, employing 1,305,000, paid into the Fund 10 times as much as the single group at the bottom, but the group at the bottom, employing 171,000 has drawn out as much as the eight have paid in.

That is what I have in mind when I say that we must view this problem, not merely from the point of view of the individuals, or from the point of view of industry as well. A scheme cannot he called an insurance scheme, in which the liability is spread so widely that at a time of great depression you are laying burdens on some industries out of all proportion to the risks which they themselves add. We know that there must be a general risk. The problem which has arisen is a problem as to whether the risk is not too big as between the industries at one end of the scheme and the industries at the other. That is the kind of problem which has brought us to a point where we have to face a deficit of £70,000,000 in the Fund. That is the kind of problem which must be faced. We have to make up our minds, finally, how to solve that problem and whether or not we are prepared to divide our unemployment relief into two classes—in the one case to have real insurance which can be justified to any employer, any individual or any industry, and in the other case, frankly to Face the problem of the able-bodied, and organise it on a national basis, always having in view the provision for those men of the first available jobs made by the nation, if the nation decides to approach the matter from that point of view. I am only putting that point in order to show what I have in my mind as the alternative, but it would mean a very lengthy speech were I to continue.

The summary, as I see it, can be stated as follows: First, the unemployment insurance scheme, according to the sums of money for which we are now asked, is itself in danger administratively, because the interests of the great majority of the 12,000,000 contributors are prejudiced in order to meet the special circumstances of a much smaller group; secondly, a class has been created artificially between the insurance scheme and public assistance which tends to become permanent; thirdly, this class is in receipt of benefit on a non-contributory basis, at the same rates as those who contribute; and, fourthly, there are other groups of uninsured workers who have no such claim but who must go to the Poor Law. I think that is an accurate summary of the case to-day, and I feel sure that hon. Members in all parts of the House will agree with it. It is to the implications of that summary—and this White Paper to-day must drive the minds of all thoughtful Members of the House to the implications of those facts—that all of us, in the light of our several experiences and our knowledge of the working of the Fund, must frame our policies and justify them on the Floor of this House.

I cannot talk about the partially insured or the uninsured to-night. Unfortunately, our rules do not permit us, except very occasionally, to have a debate about the whole problem of unemployment insurance at one time, and I think the time has arrived when we might easily have that. The thing which we might discuss is the question of a basis, for when we come to successively borrowing in this way, at a time when there seems no sign of any break in the industrial depression, we have to direct our minds to the provisions which an insurance scheme should contain. I would draw the attention of the Committee to the first document ever written about this problem. It was written by Sir H. Llewellyn Smith, in the early days of the first Insurance Act, in which he set out in an admirable manner what ought to be the insurance basis for a real insurance scheme, and on which the right hon. Member for Epping (Mr. Churchill), when he brought in his Bill, largely modelled his first scheme.

The problem of the basis of the scheme has never been faced, in my recollection, in any of the continual debates which we have had from time to time. The House, on the one hand, and successive Governments—I am not blaming one more than another—have failed to realise two things: first of all, that unless the scheme is an insurance scheme, you must get to a point where you cannot justify the scheme as insurance; and, secondly, that for fear of overburdening the local rates, we have made an impossible compromise, a compromise which means a series of continuous borrowings, which only throw a partial light on the real condition of the whole problem. Therefore, we are asked to vote this money, and, of course, the money must be voted. Whether it is £9,000,000 or £10,000,000 is a matter of a protest, a Parliamentary opportunity, or what not. The money must be voted, and that is clearly understood by every Member in the House. But as to whether we do it with heavy hearts or with light hearts depends upon our view as to what is likely to be done in the near future about the problems which I have tried to outline to-night. It is quite easy for all parties in the House to say that their ideal is a solvent fund, and indeed they have all said so except one, I think. I do not know whether the hon. Member for Camlachie was speaking for himself and his colleagues when he hinted that that was not his view, but all the responsible leaders who speak for parties in this House have held that one of the things that must be done is to put the fund upon a solvent basis. It is reassuring to see that in the terms of reference that we are to have the question of what is to be done with those who are not able to qualify under a solvent fund inquired into.

It is interesting to see the choice of Chairman of the Commission, and, speaking from these benches, I expect that throughout the whole House the name of the proposed Chairman will carry great weight and great authority, but there are two kinds of Royal Commission. There are those that play for time, and there are those that prepare for action. Speaking for myself and my friends, we should welcome an assurance before this debate is ended, not merely that there must be a vote to-night for the money required for this temporary purpose, but that the Commission is not meant to play for time, but is meant to prepare for action. Action there must be, and I trust that when action is taken by the Government and by the House it will be action that can be justified in terms of the needs of the unemployed, of the financial position of the country, and of a sound Unemployment Insurance Fund which can be justified in the light of day before either those who are insured or those who, like the Members of this Committee, are responsible for voting sums of money from year to year for carrying on this great social experiment. I hope this will be the last of the borrowing Bills, and I sincerely hope that we shall have some action, and action in the near future, along the lines hinted at in the terms of reference to the Commission that is being appointed.


One rather hesitates to oppose almost anything which is brought forward in this House by the right hon. Lady who is Minister for Labour, because she has shown such courage in dealing with these matters that one hesitates to do anything that might in any way embarrass her, but in reality the people who embarrass the right hon. Lady are not those who sit on this side; unfortunately, she is embarrassed by the Government, who lack the courage which she possesses and therefore put her to the ignominy of coming down to this House and sheltering the Government behind the Commission, which is appointed merely because they have not the courage that she has to deal with this question.

The hon. Member for Leith (Mr. E. Brown), who has just sat, down, has shown to us how much he deplores the present condition of things and, I have no doubt, deplores the way in which the present Government have contributed to this state of affairs, but, if he thought a little more deeply about it, instead of, as I suppose, sharing the views which have been expressed by some of his leaders to the effect that we should avoid a General Election in order to prevent the country getting the Government which it wants, if, instead of associating himself with them, he would take the right course of voting against the Government in this matter to-night, he would probably do more to bring about the ultimate solvency of this Fund than he will by taking the pusillanimous course which he proposes to take of supporting the Government while they are still trying to borrow another £10,000,000.

The real position here is that the state of this Fund is brought about by the fact that the Government stolidly refuse to face the facts of the situation. They stolidly refuse to face the real problem of doing something to prevent unemployment, and they have solidly refused to face the facts as to why, under the present conditions, the numbers of the unemployed have been swollen to the extent that they have been. Let us go back to the great change that was made in their Unemployment Insurance Act with regard to the conditions of qualification for benefit. The hon. Member for Camlachie (Mr. Stephen) said that one heard a great deal in this House about the solvency of the Fund, and that Members did not seem to express any great anxiety with regard to the circumstances of the unemployed; they could think about funds, but they could not think about human lives.

The real position of the present Government could not have been more accurately expressed. They entirely refuse to face the position, and the effect upon human lives and upon the circumstances of the unemployed by the policy that they have steadily pursued in Unemployment Insurance. When last year the Government took away from the qualifications for Unemployment Insurance Benefit every shred of personal initiative, they were paving the path which has led to this application for increased borrowing powers. The Government and all Members on the other side are refusing to face the fact that their policy is pressing most harshly on the genuine unemployed, and upon those in employment who are being driven into the ranks of the unemployed by the excessive burdens which their policy is placing upon industry.

The hon. Member for Camlachie said something which suggested that everyone who criticises this scheme is casting calumny upon the unemployed. Everybody who speaks honestly about it knows perfectly well that nobody is casting calumny upon the unemployed at all. We all know to our sorrow the great and increasing number of unemployed, and we know that a vast majority are unemployed through no fault of their own, and are, notwithstanding the state of legislation, trying day after day and every hour of the day, at cost to physical suffering, pain and health, to get employment. What hon. Members on the other side will not appreciate is that their task in getting employment is rendered a thousand times more difficult by the way in which the party opposite are administering the Insurance Scheme. It may very well be, and I have no doubt about it, that those who receive their Unemployment Benefit in abuse of this scheme are a comparatively small minority, but, on the other hand, they are an increasing number.


Tell us what the abuse is.


It is extremely difficult, when an inquiry has never been made, to put the whole matter into statistics, but I would like some hon. Members opposite to inquire into this. I agree that we are dealing with a very small minority when dealing with those who come before the Criminal Courts, but if hon. Members went into those Courts they would find that, up to the passing of the Act for which the Government made themselves responsible last year, time after time prisoners would say: "We were driven to theft by unemployment, and we were not in receipt of anything in the way of unemployment benefit." It will be found to-day that the record which is given of a large number of people who come into the Criminal Courts is of this kind: "This man, who is not making, and has not made for a very long time, any effort of any sort or kind to get work, is in receipt of unemployment benefit, and there is no excuse whatever for the offence which he has committed."


You are talking a lot of nonsense!


It is true that it applies to a minority, but hon. Members opposite ought to recognise that those people who are wrongly in receipt of benefit are stealing just as much from the honest unemployed, and from the men who are to-day in work and may tomorrow be unemployed, as they are stealing when they go into somebody else's house and take goods away. Until hon. Members opposite recognise that position, they will not be facing the real facts of the situation.

Another class which is increasing consists of younger people from 18 years onwards, who are undoubtedly drifting, largely because the obligation of personal initiative to find work has been taken from them, into the class who do not want to find work, and who are content to live upon the comparatively small amount which they get from unemployment benefit. Social workers will tell you that there is to a very terrible extent—though, compared with the great volume of unemployment, it is small, although terrible enough—a number of cases of the younger people over 18 getting unemployment benefit who find that they can share a room, and, after paying for the room, get 27s. a week between them; for this they need do nothing, and need not use the smallest initiative towards getting work. It is time that hon. Members opposite realised that these people are a growing class, and they ought to protect the younger men from the temptation that they are putting before them by the way in which they are administering unemployment insurance.


[...]here can we get the facts? We want them.


Hon. Members opposite can get the facts from almost any social worker in the country.


Can we have any names?


Hon. Members ought to know that I am very careful about any facts which I put forward in this House. They ought to know also that it is a serious matter that those they represent should be hindered in their search for employment by people who are abusing Unemployment Benefit. One listened some time ago to a speech by the Prime Minister, in which he dwelt upon the evil of employers who were guilty of legal abuses of the present Unemployment Insurance system. I listened to that speech with great interest, but there is one abuse which, at any rate, should be considered. Take the position where the employers are perfectly willing to keep the works or mine open for four days a week, or slightly more, and they are informed that it would be more in the interests of the men—on matter what the interests of the employers are—to keep the works open three days a week in order that the men might get more by working three days and getting unemployment insurance for three days than they would get by working four days. That is an abuse for which the employers cannot be held responsible, but it is an abuse with which the right hon. Lady would not agree for one moment. These are all matters to be considered. When hon. Members opposite say, because we raise matters of this kind, that we are calumniating the working classes of this country, they know perfectly well that they are talking irresponsible nonsense fur purely party purposes. It is time they and the Committee faced the question. It is time the Committee told the Members who sit on the benches opposite that the country has had enough of their shams and shuffles, and it is time they put other people in their places.


The last speaker said that the Government were refusing to face the facts. The Government every day are facing the critical fact, which is that the industrial system, which is supported by the hon. and learned Member and his friends, has utterly failed. It has failed to supply the needs of the country, to provide work, and to look after the men and women who depend upon industry. The hon. Member for Leith (Mr. E. Brown), in an interesting speech, touched briefly on a number of headings that will doubtless be matters for the Royal Commission, but we should be out of order in discussing them to-night. The Royal Commission, which the Government propose to set up on unemployment insurance, has not been very warmly welcomed in the Committee to-night, but we ought to welcome it, and to welcome anything that will throw the searchlight of publicity upon the difficulties of administration of unemployment insurance, and, in particular, on the injustices and hardships which men and women have to endure under it, I, therefore, welcome the appointment of this Royal Commission, remembering that it is not the Royal Commission but this House of Commons which will ultimately decide what changes or modifications have to be made in the administration of unemployment insurance.

I have noticed that in all these debates—and we have had a good many—the Opposition always appear to suggest that the trouble is due to the Labour Government, and, in particular, to abuses by the workers who are under unemployment insurance. Neither allegation is true. The present Government are the only Government who have made any endeavour to deal with the great problem of the insolvency of the Fund by the provisions in the Unemployment Insurance Act passed at the beginning of this year. The Fund was drawn up in 1920 by actuaries who believed in the old-fashioned idea of cyclical periods of unemployment. The insurance scheme of 1920 was followed by a terrific industrial and financial crash, and after 1922 there has never been a Fund but simply a deficit. We talk a great deal about insurance, solvency, legality and so on. There is too much talk about legality, and too little about humanity. We have to realise that the human side of the administration of unemployment insurance is very much more important than sound insurance principles, or legality or anything else. The State has got to change its attitude in dealing with the question of the unemployed. If a man is run over in the road, everybody rushes to look after him, the ambulance comes and takes him away to hospital, and the country looks after him. If a man is unemployed, what happens? Nine people out of 10 look upon him with contempt. The whole attitude of the community towards men and women who are unemployed has got to change, and the State has got to realise its responsibility, either to find work or to give adequate maintenance to the men and women who are suffering from the injustice of a system, for which they are not responsible and of which they are the victims.

The hon. and learned Member opposite spoke about the abuses of the system. What may be right legally and from the insurance point of view may not be right and just from the human point of view. A great deal has been said by hon. Members opposite who are supporting the Amendment, that there are legal abuses of the Fund by the workers. Just as there may be—and we have not had very sound proof to that effect—legal abuses by the workers to obtain benefits to which they are, apparently, not entitled, there are legal abuses—and many of them—depriving workers of benefit to which they are entitled. I will burden the Committee only with one example.

There are in my constituency men and women who have contributed to the Insurance Fund ever since 1912, ever since there was an insurance Fund, men and women who have worked in the factories for 10, 11 or 12 years, not merely in the same trade but in the same factory and at the same bench. Then they are thrown out of work, and what happens? The men are offered temporary work in the fields and the women domestic work, both non-insurable occupations. If they refuse, they will probably be disallowed benefit. If they accept, they will find work for five or six weeks, then be out for one or two weeks and, after they have been in that temporary non-insurable occupation for 70 weeks, they come under the second transitional provision and are then disallowed benefit because they are not normally in insurable occupation, although they have con- tributed regularly to the Fund for 10 or 12 years. That is an example of men and women who paid to that Fund and yet are being legally deprived of the benefit to which they have contributed for so many years. That is a real abuse of the Fund by those who administer it.

I wish to ask the Minister whether it would be possible to lighten the burden on the Fund by removing some of the ancillary services. I have been given to understand that the expense of a very large section of the administrative part of the Ministry of Labour and of the Employment Exchanges is borne on this Fund. Would it be possible to transfer some of those charges from the Fund to the Ministry of Labour Vote? The Committee will have to pass this Resolution and must look forward to very much more drastic measures when a Bill will be introduced, as it must be, before the transitional period comes to an end in April, 1931. Whatever the Royal Commission reports, whatever it is decided to do for the men and women who are not on an insurance basis, whatever is done in taking them off the Insurance Fund and giving them State relief, there are two cardinal principles upon which we ought to insist. The first is that no extra charge should fall on the ratepayers.


The hon. Member is transgressing the Rules of order. He is getting away from the Money Resolution, which deals with the Acts of Parliament as they now stand. It is not in order to discuss what future legislation may do.


This is my concluding remark. The State must realise its responsibilities to the men and women who are unemployed, who are the victims of the industrial system, and under no circumstances must there be any effort to reduce those responsibilities. Rather would I like to see the gaps under which men and women are deprived of benefit filled, and decent benefit given to them.



On a point of Order. Will the right hon. Gentleman who has just risen conclude the debate from the Opposition side?


That is more than I can say.


We want to know what the arrangements are. [Interruption.] It is very nice to make these arrangements behind our back.


The hon. Member for Northampton (Mr. Malone)—


I would like to ask my question again. Are we to understand that the right hon. Gentleman the ex-Minister of Labour is to wind up the discussion?


That is more than I can say. I have no responsibility for that.


If the hon. Member asks me that question, I can only say that it depends on the amount of time I take, which, again, depends upon the way I am listened to, and also on the amount of time taken by the Minister who may speak after me. For the moment I do not know which Minister is going to reply, and therefore I cannot give the hon. Member any further information.


I hope it will be the Minister of Grace who will reply, and in the meantime I want to know whether the angels or the devils will have an opportunity of saying something.


The debates are limited as to time.


That is the reason why I want some time. [Interruption.] I have done 14 days' hard labour before you were born. [Interruption.] Of course it ought to have been more.


Such time as may be available is being abbreviated bit by bit by what is happening. I wish to make one remark at starting with regard to the speech of the hon. Member for Northampton. Quite rightly, he laid emphasis on the human side of the unemployment insurance system, and the advantages to many of the benefits which are given; but I would suggest to him that it is perfectly possible to combine a system of great humanity with a proper scheme from the administrative and from the financial point of view. Indeed, I think it is quite probably the opinion of those who have had most to do with the problem that a scheme that is good from the financial and administrative point of view is more likely than not to be that which is best from the human point of view.

I do not wish to do more to-night than to sum up and set on record the position which we have now reached, first from the financial point of view, and to place before the Committee the heavy financial commitments which face us. I would take together the increased debt on the Fund, and what it means to us annually, together with the increased charge on the Exchequer. I am not going to deal with the question of transitional benefit, but from this point of view they form one problem. Quite apart from the annual burden of contributions, these charges are approaching a figure which is equal to the whole of our national Sinking Fund. Hon. Members opposite and the Chancellor of the Exchequer, who has indicated to us the value which he sets upon having an adequate Sinking Fund, must realise by this time that the whole benefit of the Sinking Fund is likely to be wiped out by the growth, at the present annual rate, of the indebtedness of the Fund.

The speech of the Minister showed that there is no longer any pretence of superior financial virtue on the part of the Government. Their admitted policy is to borrow, to borrow again and to go on borrowing. No term is set to this process; no end is in sight, and the intervals at which they come to Parliament for more borrowing powers grow shorter and shorter. What is more, there can now be scarcely any pretence that this debt will ever be repaid, that it will ever be anything else than a burden which has to be taken over by the Government. If there were any doubt at all on that point it is made clear by the terms of reference to the Royal Commission.

I do not want to anticipate future legislation, but it is quite clear that it is contemplated that the Royal Commission shall recommend a new system different from the one we have at the moment, and and it is perfectly obvious that no new system can be set up which will, from the start, have an accumulated debt of £70,000,000 or more hanging round its neck. That is the gravity of the financial position at the present moment.

There is another consideration which I think is even more serious and to which I should like to call the attention of the Committee. We have had points of serious weight placed before the Committee this afternoon, but all those points fall into comparative insignificance compared with another consideration both as it affects the Fund and its intrinsic importance. Earlier in her speech this afternoon the Minister of Labour told us that the expense which was being incurred at this moment over and above what was met by contributions was the annual amount of about £68,000,000. I am not certain whether she said £62,000,000 or £68,000,000, but out of that annual expenditure over and above what was paid by contributions she pointed out that only £13,000,000 could be set down to administrative changes which had been recently introduced. The right hon. Lady said that all the rest of the cost of £50,000,000 more or less was due to the great increase in unemployment. I ask the Committee to consider this sum, not only in relation to the extra cost of unemployment benefit, but also in relation to the extra cost which has been put upon it by the ever growing amount of unemployment from which we are suffering at the present moment.

Why have the Government had to come to this House three times this year for further borrowing powers? Will this third time be the last, or how many times are we going to be asked to vote further increases? Is this just merely a drop in the ocean of the additional borrowing powers that may be required? From the point of view of unemployment, this is a matter which we have a right to keep in view, and upon which we ought to keep watch. That is the reason why I am supporting the Amendment to reduce this sum from £10,000,000 to £9,000,000, or in other words, to reduce the limit of £70,000,000 to £69,000,000, partly as a protest, and partly in order that this House may keep watch on the expenditure and be able to pass it in review. Misfortune sometimes makes strange bedfellows, and in this matter I find myself agreeing with the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) and also the hon. Baronet the Member for Smethwick (Sir O. Mosley) and those who work with him.


That is a new alliance!


I think the hon. Member for Dumbarton Burghs (Mr. Kirkwood) agrees that, so far as this question of unemployment is concerned, it has to be tackled very boldly. The right hon. Gentleman the Member for Carnarvon Boroughs said that we must have no titivating measure. We have to deal with this question boldly, and, in the words of the right hon. Gentleman the Member for Carnarvon, "First things must come first." Here are the right hon. Gentleman's words: Here we are beginning at the wrong end in dealing with unemployment insurance. We are undoubtedly piling up a tremendous bill which this country ultimately cannot bear, and what we ought to consider with unemployment, is not increasing the burden but diminishing it, by seeing that work is provided. We have to think of a way to diminish the number of people who need to be relieved as well as the expense of supporting them when they are unemployed. From this point of view, it is clearly of vital importance that we should go fully into this matter. The Minister of Labour this afternoon looked forward to the possibility, which she prayed might never come, of 2,500,000 unemployed before the winter was out. In addition to the effect which that would have upon this Fund, it would make the situation in the country almost intolerable. It is from that point of view that I ask this Committee to consider the extraordinary gravity of the industrial situation in which we are placed to-day both as regards its effect on the Fund and its own intrinsic importance.

I doubt whether the Government have really recognised the gravity of the situation, or where they are going. I think they have not grasped it, or, if they have, they have never told the country. The Government never explained that we are almost on the edge of an abyss to-day as regards the unemployment question. A year ago we were told that things would be better in the spring. I have read the speeches of Ministers on this subject with great care and there seems to be one refrain running through them all. They say that at the present moment the Government are not to blame for the present state of things, that there are world causes at work, falling prices and all the rest of it, and, what is more, world causes from which all industrial nations are suffering alike as we are suffering. The Government go on to say that if all nations are suffering alike, there is naturally some hope that we shall all recover alike when the turn of the tide comes. If we all recover alike, they say that we shall get our share of the recovery, and therefore we are justified in thinking that things will be better next year, and we must wait and see.

The whole justification of the Government is based on the supposition that while we are suffering, other nations are suffering like ourselves. There is not a word of truth in it. If other nations are not suffering like ourselves, it means that if they make a recovery, then possibly we cannot look for one, and therefore, from the point of view of this Fund, there is no justification whatsoever for going on borrowing in the hope that something pleasant will turn up. The Committee will forgive me if I stress this view to them, because at the present moment it is a matter of amazing gravity for this country. There is not one of the big industrial countries in Europe that is suffering in the same way that we are. [Interruption.] An hon. Member says that Germany is, but the case of Germany, although there is a lot of unemployment there at the present moment, is so different from ours that it would prove the truth precisely of what I say. I should be straying beyond the bounds of order if I went any further on that subject, but, if you take any other industrial country in Europe, no matter whether it be France, or Belgium, or Czechoslovakia, or Sweden, or any other of the great industrial countries, they are all comparatively prosperous as compared with ourselves. Throughout this year, which has been one of acute depression with us they have all been prosperous until quite late in the year. If there is any setback there now, it is only a comparatively small setback. They are not even at this moment suffering from more than the average amount of unemployment that existed in this country in pre-war days.


The right hon. Gentleman is considerably widening his illustrations.


Then I will come back directly to the inference, which I think will be within the scope of the Resolution, and which I think you will see has a most direct bearing on the problem before us to-night as well as generally. If it be true that these countries are not suffering as we are, that they are more prosperous than we are, it means that there are special causes affecting us which do not affect those other countries, and which have made us feel unemployment in this crisis much more acutely than they have; and that, when the turn of the tide does come, as we are promised by Ministers that it will come in the world generally, the same causes will operate, so that other countries will get the lion's share of the recovery, and we shall only get the scraps and the leavings. That is the reason why, from the point of view both of this fund and of the country generally, the worst disservice possible has been done by Ministers, who, not only as regards the administration of the fund, but as regards the whole question of unemployment, have never realised its gravity; have never put before the country the real position in which this country is placed to-day. [Interruption.]

The result is this: If we are in a unique position, it means that at the present moment causes are affecting us which have not been present in any other country, Germany or any other, and it means that, if there is a turn of the tide, we shall still go on, our debt will grow greater, and we shall have to come back for more and more additional borrowing powers, while on the other hand the amount of unemployment will increase until this country is really drifting towards disaster. I would place before the Committee this consideration. We could never have borne our present burden if it had not been that we have been living on the savings of our fathers, which have been placed in foreign investments. [Interruption.] That is absolutely true. That is the only thing which has enabled this country to continue to bear the weight of its unemployment— [Interruption.]


These interruptions must cease.


The only thing that has enabled this country to bear the weight of its unemployment up to this moment is the fact that we are drawing a large income from investments abroad, which represent simply the savings of our fathers. If we were living on our own production, we should be in a state like that in which Australia is to-day, for the simple reason that our productivity is not enough by itself to support the population that we have in this country to-day—


The right hon. Gentleman will, no doubt, remember that there will be another discussion later on.

10.0 p.m.


I should have been able to point out more closely the bearing of my remarks had I been allowed to do so without such an obligato of interruptions. Let me add this. If that be true, as it is true—no one who has been into the facts can deny it—it means that, if we go on as we are, we are going straight to disaster as regards this Fund. It will be not a question of £70,000,000, but of £80,000,000, £90,000,000 or £100,000,000, and what is true of this Fund will be true of the state of the country and its industries as a whole. If that be so, it lends overwhelming force to the representations that have been made, as I have said, both by the Leader of the Liberal party—[Interruption]—the right hon. Gentleman the Member for Carnarvon Boroughs, and also by the hon. Baronet the Member for Smethwick and those who are associated with him. They have asked that the problem should be treated as one of vital gravity. It has never yet been so treated, nor have the whole facts been made known by the Government on behalf of this House. Whenever speeches are made, employers are treated by Ministers to a certain amount of exhortation and objurgation, and after that there is a dose of the old soporofic telling them that all will be well again in the spring, that unemployment will go down, that there will not be such a drain on the Fund, and that things will be better with us. [Interruption.]


It is very unfair that hon. Members should persist in making these interruptions.


I am not in the least upset by the obligato from the opposite side, but I should have thought that hon. Members who profess to have such a great regard for the unemployed would probably wish to listen with a little more consideration to a discussion of the causes which lead to a greater amount of unemployment. [Interruption.] I have tried to put these considerations before the Committee in order that it may be realised to what an abyss the country is drifting. I suggest that what we ought to do is, as has been suggested both from the Liberal benches and from the Labour benches, to ask the Government to give us a lead and really to let the country face the situation as a whole. It is my belief that, if the country faced the situation as a whole, it would be ready to meet it, as it has met equal crises in the past. At the present moment in industry, although some hon. Members may laugh at it, we are facing a peace-time crisis which is just as great and just as real as any war-time crisis that we had to face. The only difference about it is that it is not quite so easily comprehended, and, therefore, although it is as real, hon. Members think that it is a thing to laugh at. If the Government had done their duty, they would have placed the whole facts before the country. We cannot look for any turning for the better in industry so long as we go on as we are doing. Until they are told the facts, and if we go on as we are doing, the Unemployment Insurance Fund, and, what is more important, industry as a whole, will be driven aimlessly and helplessly to real disaster so long as the weak hands of the present Government are at the tiller.


There is a point of view that has not yet been put forward, with all deference to those who have spoken. Will there be five minutes given to those who wish to express it?


I do not know what point of view the hon. Member refers to.


The Socialist point of view.


I can assure my hon. Friend that probably there will be more than five minutes for him by the time that I have finished. The burden of the right hon. Gentleman's speech, to which we have just listened, is that hon. Members on this side do not realise the gravity of the present position. Those of us who are in close touch with the basic industries, and who are even in closer touch with the great mass of the people than he is, realise the gravity of the situation I believe more than even he does. I listened in vain for any proposal from the right hon. Gentleman. His only contribution is to move that the £10,000,000 of extended borrowing powers be reduced by £1,000,000.


What I suggested was that, if the Government had only told the country the real truth about the industrial situation, they would have helped in the question of unemployment, and there would have been no need for an increase.


The Government has done what they could to let the public know the facts. Meantime the duty of this Committee is to consider the victims of unemployment. The complaint is made that the Government did not appoint a Royal Commission in July. It must be made quite clear that the statistics that have been given concerning legal abuses are very narrow, that they were got very hurriedly, and have still to be verified. The point was emphasised that the Committee and the country got the impression that the Government were asking for increased borrowing powers because of legal abuses. The Government are compelled to come for increased borrowing powers because of the increase of unemployment. When unemployment increases, not only is that burden thrown on the Fund, but there is also the withdrawal of the contributions, so that the burden is a double one. The 1930 Act only came into operation in April, and it was not possible to get an exhaustive inquiry. Take the married women question. There has been a lot of talk, not recently but for many years, upon that Question. It was examined by the Blanesburgh Committee, and some of the remedies suggested were turned down by the Committee. Take the question of part-time work. If there was need for dealing with that question, why did the previous Government not deal with it? The same things v ere said then as now.


What I tried to make clear was that the position with regard to part-time work was greatly accentuated by the fact that the present Government had withdrawn one of the qualifications for benefit, namely, that a man must be genuinely looking for work.


That is where the hon. Gentleman is wrong. Not genuinely seeking work did not operate as far as these men were concerned at all, and it has not been touched by the operation of the present Act and could not be applied with the greatest stretch of imagination. It has been said that what is necessary is to divide the scheme into two parts. One thing hon. Members opposite have never yet done is to tell us what they are going to do with the people who are not insured. I think the Committee is entitled to know. We have been told during the whole of the year that a great number who are at present receiving benefit under the 30 stamps contribution—


So far as the three-party committee is concerned, the hon. Gentleman will get an answer to his question in their report.


That may be, but I suggest that there was no need for secrecy as to the Conservative view as far as this Committee was concerned.


Might I ask what need is there for secrecy for any point of view?


Unfortunately for hon. Members opposite, a Member of their own party, and an ex-Member of the last Government, has stated definitely what they would do with those workers who are not insured. Is it not true to say that their avowed object is to turn all men over 50 who have not the 30 stamps directly on to public assistance? The gentleman who made that statement, and who has gone into detail to a much greater extent than hon. Members opposite dare to go in this House, recently wrote an article in the "Quarterly Review." I refer to the Financial Secretary to the Admiralty in the last Government, Colonel Headlam. In that article he uses exactly the same phrases as hon. Members opposite use when they are discussing the matter. He lays down some general principles and he goes directly into detail and I submit that one of the things that is certain, if hon. Members opposite had a majority, is that they would attempt to throw a great number of decent working men on to the Poor Law who are really of an employable kind.

Another point has been raised that has rather surprised me. Outside it has been quite a common thing for people to make the charge that the Unemployment Fund was demoralising great masses of work people. Up to the present those charges have been made mainly by irresponsible people. I think it would be true to say they have been made by people who live in seaside places who are in comfortable circumstances, armchair critics, who know nothing whatever about the working class, but to-night to my surprise the right hon. Gentleman the Member for Spen Valley (Sir J. Simon) actually adopted the attitude of those people. I was amazed to hear his statement. I do not want to misquote him, and I had rather he had been here, but the statement he made was so serious that it cannot pass unnoticed. He said there were certain people who were becoming so clever that they were really making an art of getting money for nothing, and the hon. and learned Gentleman the Member for Nor-wood (Sir W. Greaves-Lord) took pretty much the same line. When a statement like that is made by such an outstanding personality as the right hon. Gentleman the Member for Spen Valley, it is one that ought to be met very definitely, otherwise the public mind would be disturbed. Do hon. Gentlemen opposite think that that can be said when Members like us, familiar with the working classes—

Viscountess ASTOR

Does the hon. Gentleman mean to imply that we do not represent the working men of the country?


Judging from some of the Noble Lady's sentiments in this House, she does not know very much about them. [Hon. MEMBERS: "With draw!"] This charge of demoralisation of a great section of the workers has been made for several years now.


On a point of Order. Is the hon. Gentleman allowed to state that they alone represent the working people of this country?


That is not a point of Order.


The charge that the working classes are being demoralised by unemployment insurance benefit was investigated by the Blanesburgh Committee, and I think it will not be out of place if I read what they said about this matter. The Charity Organisation Society gave evidence before the Blanesburgh Committee on the point about demoralisation, and this is what they said: When this material— that is, that included in the memo random— was read to our people on Monday afternoon last, they were much disappointed at the general character of almost all of it. They had hoped that many more examples would be forthcoming illustrating the criticisms passed upon the present working of Unemployment Insurance by almost everybody who discusses the subject. This shows the value of bringing these criticisms to the test of demanding examples, and more than one of our secretaries said that they quite expected to find from our case papers numerous examples of abuses, but when they came to look they found very few. This does not, of course, prove that their previous impression was not a. sound one; on the other hand, it may quite well prove that unfavourable instances impress themselves upon the memory, while the proper and smooth working of a scheme passed almost unnoticed. That was in 1927. The Committee will, perhaps, be interested to hear the opinion of an authority who is certainly respected in places where unemployment insurance is discussed. I refer to Sir William Beveridge, and this year, after the introduction of the 1930 Act, Sir William Beveridge wrote: Through all the transformations of insurance one element endures; one weapon has been added since 1911 to the permanent armoury for dealing with distress. Administration of benefit in all its forms—standard, extended, donation—has shown the possibility through a Labour Exchange system of controlling direct money assistance of the unemployed insurance sufficiently to prevent any serious abuse. Charges that the 'dole' was helping men to live in idleness when they could get work have been made incessantly in the press, by local authorities and by public men. Whenever they have been investigated, they have been shown to be idle and irresponsible talk. This is evidence of a negative kind. I have been at pains to gather some evidence which will interest the Committee and perhaps the country from the point of view of the charge of demoralisa- tion. Most hon. Members know that I come from the centre of a greatly depressed area, which has been in such a condition for many years, and I have not seen any evidence of demoralisation. Let me give some evidence from the criminal statistics of the country. I have been in touch with the Home Office on this question. I made inquiries to discover whether the alleged demoralisation had reflected itself upon the conduct of the people in so far as the law was concerned. The last report of the Home Office gives figures showing the increases and decreases of several different classes of crime since 1910 up to and until 1923. This is what the report says: When figures for the various kinds of non-indictable offences are examined, it is clear that the greatest decreases have been in proceedings for offences indicating criminality or low standard of life. The average number of proceedings for begging for the years 1910–44 was over 25,000, and the corresponding number in 1928 was just over 5,000. Take the subject of savings. Demoralisation would show itself in its effect upon the saving capacity of the people. The Chief Registrar of Friendly Societies, in his official reports, points out that in the year 1924 the total funds of the registered provident societies amounted to £566,000,000, and in 1928 the total amount saved by the working classes and contributed to these friendly societies was £819,000,000. That shows that the morale of the people of this country is not only as good but infinitely better under the present system, when the people get an opportunity of locking after themselves. The hon Member for Leith (Mr. E. Brown) put the point well when he said that the alternative to the present unemployment insurance system is social riots and general demoralisation of a kind that can he seen in other countries. There are some people in this country who really think that the worse off the working Classes are the better they will work and the more amenable they will be. [Interruption.] People who charge the great masses of the unemployed with demoralisation have that idea at the back of their minds, but I submit that the figures I have given, as well as the experience of anyone who comes into close contact with working class life, proves that the contrary is the fact. The hon. Member for Leith asked a very pertinent question. He wanted a definite pledge that the Royal Commission was not proposed for the purpose of playing for time but that it was to be a Commission of action. I am authorised by the Minister of Labour, and by the Government, to say that it is to be a Commission of action. There will be interim reports upon which the Government will proceed from time to time. [Interruption.] In asking for this £10,000,000 the Government is meeting the situation to the best of its ability. It is meeting the needs of the masses of the people and caring in a human way for the people. We have no hesitation in asking the Committee to Vote against the Amendment for a reduction in the amount, and I hope the Committee will come to a decision as soon as possible


The real truth of the matter is that the Government have got into a very sticky hole, and they do not know how to get out of it. [Interruption.] You know you are in a sticky hole, and you are wondering how you are going to get out. You are just waiting for something to turn up. The Treasury Bench reminds me of a lot of quacks who have got together. They thought that by advertising, which is quite contrary to the usual procedure in the medical profession, they would get together a clientele. They have got their clientele, and have poisoned them. They are now going to try some other medicine, Mother Seigel's Soothing Syrup, or something of that kind. [An HON. MEMBER: "Sandeman's Port!"] That is not mine. It belongs to a cousin, but I think it would do some hon. Members some good. The Government are not at all certain that this new dose is going to he effective. It is said that the Lord helps those who help themselves. The Government are trying to help themselves by handing over something; and this something is having a very bad effect on the country. [Interruption.] It is indeed, it is having a very bad effect. [Interruption.] I know that the hon. Member for Silver-town (Mr. J. Jones) wants to get in.


Order, order! Neither the Parliamentary Secretary nor the hon. Member has any right to say who is to speak next.


To come back to the subject of the demoralising effect of these doles, I am perfectly certain that that demoralising effect is being felt all round. I have had case after case brought to my notice which make one shiver. [HON. MEMBERS: "In your constituency?"] I have not said where they were.


On a point of Order. May the Committee share in the conversation which is going on between the hon. Member and his hon. Friends opposite?


It is not my fault if the hon. Member does not hear what is being said. I have already appealed to the Committee. These interruptions should not be so insistent, and I have pointed out that when interruptions become insistent, they also become disorderly.


I know of not one, but several cases where men are beginning to count the stamps on their cards just to see when they can get on to the dole again, and, if that is not demoralising, I do not know what is. The right hon. and learned Member for Spen Valley (Sir J. Simon) talked about the number who remained on the register who could have gone off. Surely, that is demoralising and the people who are suffering are those who have paid their insurance, on the understanding that if they are out of work they will have a sound fund on which they can bank. If this sort of thing continues it means that the Fund will become bankrupt and these people will be made entirely dependent upon another demand by the Government to Parliament for more money to support the Fund. I ask my hon. Friends below the Gangway on this side to take their courage in their hands. The whole country is crying out for an election.


That may be so, but it does not arise here.


I am appealing to hon. Members below the Gangway on this side to put country a little in front of party. They know that the country is tired of all this.


An attempt was made earlier to introduce these matters, but I did not allow it, and I trust that the hon. Member will bear in mind that we are dealing with the Money Resolution and with nothing else.


I am sorry that I was not present when that Ruling was given or I would not have transgressed. But I know a great deal about what is going on in the country in regard to this insurance question, and I would say to many of these people—[HON. MEMBERS: "What people?"] Hon. Members below the Gangway. It is to them that I am making an appeal that they should give us a chance to end this. If we are to spend £10,000,000, surely it would be far better spent in doing something to give people jobs, rather than in paying people for keeping out of jobs. We all know how many orders are being lost to this country. Take one order—


The hon. Member must try to confine himself to the Resolution before the Committee.


There are many points that come out of this Resolution upon which I should like to expand, but I will finish on the note that I believe that this Resolution, less the reduction which we propose, must be passed, because the Fund has to go on, but I hope the Commission which is being set up will get to work quickly, so that we shall have further facts to go upon which will show us exactly what is happening and how we can make this Fund solvent.


It is very interesting to those of us who have listened to most of the speeches to-day to hear experts like the last speaker. They know all about it, but we on these benches can lay the flattering unction to our souls that we were always opposed to a contributory system. I come from the constituency that sent the first Labour Member to this House, independent of other parties, and then he fought for the right to work or maintenance for the working class, the only class who were ever denied the right to work or maintenance. All the others have got it both ways. This is a proposal that we should spend up to another £10,000,000 to deal with the greatest social problem with which we are faced to-day. I hear lion. And right hon. Members opposite protesting emphatically against the extension of this system of insurance, and I listened to them the other night enthusiastically supporting the Government when they voted a subsidy to one of the companies that some of them are interested in. [Interruption.]


You are all interested in grand opera.


Some of them have only just come from the opera—[An HON. MEMBER: "Comic opera!"]—and I am as good a humourist as you will get at some of the operas that you attend, but I do not get paid so much. I want to remind hon. Members opposite that this is only putting the workers in form. The King rules over all, the lawyer pleads for all, the soldier fights for all, the parson prays for all, and the worker pays for all, and, when you have boiled your insurance schemes down to their ultimate, you discover that after all it is the men arid women who work who provide all the means whereby all your schemes can be carried into effect, though we have hon. Members opposite—I know the history of some of them, but the hour is too late to go into it. The history of England is red with it

There are people who talk about a workman drawing 17s. a week for doing nothing, and they have been drawing £17 a week ever since they were born, and have done nothing, and done it very well, all their lives. The workman pays into the Insurance Fund whether he likes it or not, but they have never paid into anything. They have always been taking and never giving. If you go down to economic facts, you know that what I am saying is true. You are only able to insult the class which keeps you, and I stand up for the class to which I belong. Under the insurance scheme, when a workman happens to be in work, he pays out so much of his wages every week—


Has this eloquent speech any relevance whatever to the discussion?

Lieut.-Commander KENWORTHY

Wait until you have been here five minutes before you interrupt the hon. Member for Silvertown (Mr. J. Jones).


The hon. Gentleman is trying to relate his comparisons to Unemployment Insurance.


I regret the impossibility of co-relating hon. Members opposite with the subject of Unemployment Insurance, but they have never paid any. What I am trying to point out is that every day that a man works in the docks in my constituency, the insurance is deducted from his wages. Every week the regular workman is at work, it is deducted from his weekly wages.


Is the hon. Gentleman in order in saying that hon. Members on this side have never paid Unemployment Insurance, when every employer pays it?


I do not think that I am called upon to determine that point.


The hon. Member has not come here like Daniel. We know very well that every employer puts the cost of insurance on to the cost of production of the commodities which he is producing, and that eventually it comes back to the consumer. When anybody on those benches talks about the workman getting something for nothing, it is a lie, and they know that it is a lie. According to what we have heard this evening, all the Hatrys and all the forgers belong to the class to which I belong—


I have told other hon. Members that they must confine themselves to the Money Resolution.


I am trying to do so. What has been the complaint during this debate? Hon. Members opposite are not so blunt as I am; I wish they were. They have not said what is at the back of their minds. I have tried to express the feeling of the people I represent, and I resent this continual suggestion that the working classes were born with more than their share of original sin. It is said they are out to take advantage of the insurance money. There are plenty of people looking after them in that respect. There are inquiries from employers. In my own constituency there are men and women perpetually going round to discover what kind of character the men and women have who are drawing unemployment benefit. If they could inquire into the character of these other people, they would not come off so well. Yet they sit in judgment on the working class, which, in the language of Ruskin, is the only class which is not a class—it is the nation. [Interruption.] By the working class I do not mean the hon. Member. He need not look in a glass to discover a worker. What are we asked to give? £10,000,000, the price you guarantee for a battleship. We have to try to keep the men and women alive. What has caused unemployment? Men are not out of work because God is angry or Nature is niggardly, but because you have robbed them of their economic right. By your private monopoly of the means of living, you have made it impossible for them to get a means of livelihood.


I must remind the hon. Member, as I have told other hon. Members, that there are other occasions more appropriate for general remarks than this one. We are now dealing with the question of £10,000,000.


I know it is difficult to catch your eye when all the great people want to talk and—


The hon. Member has no right to make a remark like that. As far as I know, both sides of the Committee have had a very fair share. I cannot allow anybody to charge the Chair with making a particular selection. If that were true, the hon. Member might then be surprised that I should call him.




I did not say that.


There is some misapprehension. The hon. Member said something about "catching your eye," and from that remark I took it that the charge was made that I paid particular attention to other people.


I am sorry I made a slip of the tongue in that respect. I did not intend to make any reference to yourself. I know it is a general custom in this House that those who occupy the most prominent position in Parliament are always given the first show. That is not your fault, but your misfortune. I can only speak occasionally when the House wants someone to make it laugh. As far as this Fund is concerned, we are not voting for it because we believe in the methods on which it is now being conducted. I said outside this House in 1911, when this system was first discussed, and I say it now inside the House, that it is not a Measure to insure against unemployment, but that it was originally intended by its authors to be an insurance against revolution. [Interruption.] It is true. They had the wind up before the War and after the War, and they extended the Measure in 1921 when hundreds of thousands of men came back with all kinds of promises made to them about "land fit for heroes" and so on.

Now these men find themselves in the position that they have got to be heroes to get a job. Now we are to put them under a microscope. We, who are no better than they are, are now going to put them under a microscope and examine their characters. Examine your own characters, and then you will not have so much time to look into other peoples. I do not pretend to be any better than I am. Bad as I am and good as you are, I am as good as you are, bad as I am. No one of us here can look down upon his fellows. The down-and-outs, the men and women who are unemployed—you are trying to put upon them a stigma which they ought not to bear. You cannot find employment for them, and you are going to find them committees of inquiry. [Interruption.] I am trying to speak up. You never know when to shut up! We here are supporting this Resolution, not because we believe in the system at present prevailing, but because we want to help lame dogs over the stile and give them all that they are entitled to.


We have heard from the Parliamentary Secretary that he is running his Department to the best of his ability, but when he came into office he found 1,000,000 unemployed, and to-day there are more than 2,250,000. That does not speak very well for the way in which the Government have managed the unemployment question, and it is an extraordinary thing to find it suggested that the more persons there are unemployed the more thrift there is—




I must appeal to hon. Members to keep order.


We are simply imitating an hon. Member above the Gangway opposite.


It may not be disorderly for one hon. Member to call "Divide," but if a large number call "Divide" it becomes disorderly.


It is necessary to get at the root of the necessity for us to vote this £10,000,000 extra. The truth of the matter is that in increasing this grant for unemployment insurance we are casting a bigger burden on industry. We shall throw out of work a larger number of people than would have been necessary under ordinary circumstances. If the Government were to give more attention to assisting industry rather than increas-

its burdens we should have far fewer unemployed than we have to-day. Some of the speeches to-day have taken a most extraordinary turn because they have not dealt with the real cause of unemployment, or why we require this extra money. The Minister has not given us an explanation of why this money is required. The Parliamentary Secretary said he read some figures in a Home Office report showing there was less criminality.

The PARLIAMENTARY SECRETARY to the TREASURY (Mr. T. Kennedy) 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, 276; Noes, 214.

Division No. 39.] AYES. [11.0 p.m.
Adamson, Rt. Hon. W. (Fife, West) Dalton, Hugh Hudson, James H. (Huddersfield)
Addison. Rt. Hon. Dr. Christopher Davies, Rhys John (Westhoughton) Isaacs, George
Aitchison, Rt. Hon. Craigie M. Day, Harry Jenkins, W. (Glamorgan, Neath)
Alexander, Rt. Hon. A. V. (Hillsbro') Denman, Hon. R. D. John, William (Rhondda, west)
Alpass, J. H. Dukes, C. Johnston, Thomas
Ammon, Charles George Duncan, Charles Jones, F. Llewellyn-(Flint)
Angell, Norman. Ede, James Chuter Jones, Henry Haydn (Merioneth)
Arnott, John Edmunds, J. E. Jones, J. J. (West Ham, Silvertown)
Aske, Sir Robert Edwards, C. (Monmouth, Bedwellty) Jones, Rt. Hon. Leif (Camborne)
Attlee, Clement Richard Edwards, E. (Morpeth) Jones, Morgan (Caerphilly)
Baldwin, Oliver (Dudley) Egan, W. H. Jowett, Rt. Hon. F. W.
Barnes, Alfred John Elmley, Viscount Jowitt, Sir W. A. (Preston)
Barr, James England, Colonel A. Kedward, R. M. (Kent Ashford)
Batey, Joseph Evans, Capt. Ernest (Welsh Univer.) Kelly, W. T.
Bellamy, Albert Foot, Isaac Kennedy, Thomas
Benn, Rt. Hon. Wedgwood Forgan, Dr. Robert Kenworthy, Lt.-Com. Hon. Joseph M.
Bennett, William (Battersea, South) Freeman, Peter Kinley, J.
Benson, G. Gardner, B. W. (West Ham, Upton) Kirkwood, D.
Bentham, Dr. Ethel George, Major G. Lloyd (Pembroke) Knight, Holford
Birkett, W. Norman Gibbins, Joseph Lang, Gordon
Bondfield, Rt. Hon. Margaret Gibson, H. M. (Lancs, Mossley) Lansbury, Rt. Hon. George
Bowen, J. W. Gill, T. H. Lathan, G.
Bowerman, Rt. Hon. Charles W. Glassey, A. E. Law, Albert (Bolton)
Broad, Francis Alfred Gossling, A. G. Law, A. (Rossendale)
Brockway, A. Fenner Gould, F. Lawrence, Susan
Bromfield, William Graham, Rt. Hon. Wm. (Edin., Cent.) Lawrie, Hugh Hartley (Stalybridge)
Bromley, J. Gray, Milner Lawson, John James
Brooke, W. Greenwood, Rt. Hon. A. (Colne) Lawther, W. (Barnard Castle)
Brothers, M. Grenfell, D. S. (Glamorgan) Leach, W.
Brown, C. W. E. (Notts. Mansfield Griffith, F. Kingsley (Middlesbro' W.) Lee, Frank (Derby, N. E.)
Brown, Ernest (Leith) Griffiths, T. (Monmouth, Pontypool) Lee, Jennie (Lanark, Northern)
Brown, Rt. Hon. J. (South Ayrshire) Groves, Thomas E. Lees, J.
Brown, W. J. (Wolverhampton, West) Grundy, Thomas W. Lewis, T. (Southampton)
Buchanan, G. Hall, G. H. (Merthyr Tydvil) Lindley, Fred W.
Burgess, F. G. Hall, Capt. W. G. (Portsmouth, C.) Lloyd, C. Ellis
Burgin, Dr. E. L. Hardle, George D. Longbottom, A. W.
Buxton, C. R. (Yorks. W. R. Eiland Harris, Percy A. Longden, F.
Caine, Derwent Hall Hartshorn, Rt. Hon. Vernon Lovat-Fraser, J. A.
Cameron, A. G. Hastings, Dr. Somerville Lowth, Thomas
Cape, Thomas Haycock, A. W. Lunn, William
Carter, W. (St. Pancras, S.W.) Hayday, Arthur Macdonald, Gordon (Ince)
Charleton, H. C. Henderson, Right Hon A. (Burnley) Macdonald, Malcolm (Bassetlaw)
Chater, Daniel Henderson, Thomas (Glasgow) McElwee, A.
Church, Major A. G. Henderson, W. W. (Middx., Enfield) McEntee, V. L.
Cluse, W. S. Herriotts, J. McGovern, J. (Glasgow, Shettleston)
Cocks, Frederick Seymour Hirst, G. H. (York W. R. Wentworth) McKinlay, A.
Compton, Joseph Hirst, W. (Bradford, South) MacLaren, Andrew
Cove, William G. Hoffman, P. C. Maclean, Nell (Glasgow, Govan)
Cowan, D. M Hopkin, Daniel MacNeill-Weir, L.
Daggar, George Hore-Belisha, Leslie McShane, John James
Dallas, George Horrabin, J. F. Malone, C. L'Estrange (N'thampton)
Mander, Geoffrey le M. Potts, John S. Sorensen, R.
Mansfield, W. Price, M. P. Stamford, Thomas W.
Marcus, M. Pybus, Percy John Stephen, Campbell
Markham, S. F. Ramsay, T. S. Wilson Strachey, E. J. St. Loe
Marshall, Fred Rathbone, Eleanor Strauss, G. R.
Mathers, George Raynes, W. R. Sutton, J. E.
Matters, L. W. Richards, R. Taylor, R. A. (Lincoln)
Maxton, James Riley, Ben (Dewsbury) Taylor, W. B. (Norfolk, S.W.)
Messer, Fred Ritson, J. Thomas, Rt. Hon. J. H. (Derby)
Middleton, G. Robinson, Sir T. (Lancs, Stretford) Thurtie, Ernest
Millar, J. D. Romeril, H. G. Tillett, Ben
Milner, Major J. Rosbotham, D. S. T. Tinker, John Joseph
Montague, Frederick Rowson, Guy Tout, W. J.
Morgan, Dr. H. B. Samuel, Rt. Hon. Sir H. (Darwen) Townend, A. E
Morley, Ralph Samuel, H. W. (Swansea, West) Trevelyan, Rt. Hon. Sir Charles
Morris, Rhys Hopkins Sanders, W. S. Vaughan, D. J.
Morrison, Herbert (Hackney, South) Sawyer, G. F. Viant, S. P.
Morrison, Robert C. (Tottenham, N.) Scrymgeour, E. Walkden, A. G.
Mort, D. L. Scurr, John Walker, J.
Moses, J. J. H. Sexton, James Wallace, H. W.
Mosley, Lady C. (Stoke-on-Trent) Shaw, Rt. Hon. Thomas (Preston) Wallhead. Richard C.
Mosley, Sir Oswald (Smethwick) Shepherd, Arthur Lewis Watkins, F. C.
Mull, G. Sherwood, G. H. Watson, W. M. (Dunfermline)
Muggeridge, H. T Shield, George William Wellock, Wilfred
Nathan, Major H. L Shiels, Dr. Drummond Welsh, James (Paisley)
Naylor, T, E Shillaker, J. F. West, F. R.
Newman, Sir R. H. S. D. L. (Exeter) Shinwell, E. Westwood, Joseph
Noel Baker, P. J Short, Alfred (Wednesbury) White, H. G.
Noel-Buxton, Baroness (Norfolk, N.) Simmons, C. J. Whiteley, wilfrid (Birm., Ladywood)
Oldfield, J. R. Simon, E, D. (Manch'ter, Withington) Wilkinson, Ellen C.
Oliver, George Harold (Ilkeston) Simon, Rt. Hon. Sir John Williams, Dr. J. H. (Llanelly)
Oliver, P. M. (Man., Blackley) Sinclair, Sir A. (Caithness) Williams, T. (York, Don Valley)
Owen, Major G. (Carnarvon) Sitch, Charles H. Wilson, C. H. (Sheffield, Attercliffe)
Palin, John Henry Smith, Ben (Bermondsey, Rotherhithe) Wilson, J. (Oldham)
Paling, Wilfrid Smith, Frank (Nuneaton) Wilson. R. J. (Jarrow)
Palmer, E. T. Smith, H. B. Lees- (Kelghley) Winterton, G. E.(Leicester, Loughb'gh)
Parkinson, John Alien (Wigan) Smith, Rennie (Penistone) Wise, E. F.
Perry, S. F. Smith, Tom (Pontefract) Wright, W. (Rutherglen)
Pethick-Lawrence, F. W. Smith, W. R. (Norwich) Young, R. S. (Islington, North)
Phillips, Dr. Marion Snell, Harry
Picton- Turbervill, Edith Snowden, Rt. Hon. Philip TELLERS FOR THE AYES.—
Pole, Major D. G. Snowden, Thomas (Accrington) Mr. Hayes and Mr. William Whiteley.
Acland-Troyte, Lieut.-Colonel Cayzer, Sir C. (Chester, City) Ford, Sir P. J.
Albery, Irving James Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.) Forestier-Walker, Sir L.
Alexander, Sir Wm. (Glasgow, Cent'l) Cazalet, Captain Victor A. Fremantle, Lieut.-Colonel Francis R.
Allen, Sir J. Sandeman (Liverp'l., W.) Cecil, Rt. Hon. Lord H. (Ox. Univ.) Galbraith, J. F. W.
Amery, Rt. Hon. Leopold C. M. S. Chadwick, Capt. Sir Robert Burton Ganzonl, Sir John
Astor, Maj. Hn. John J. (Kent, Dover) Chamberlain, Rt. Hon. N. (Edgbaston) Gault, Lieut.-Col, Andrew Hamilton
Astor, Viscountess Christie, J. A. Gibson, C. G. (Pudsey & Otley)
Atholl, Duchess of Cobb, Sir Cyril Gilmour, Lt.-Col. Rt. Hon. Sir John
Atkinson, C. Cockerill, Brig.-General Sir George Glyn, Major R. G. C.
Baillie-Hamilton, Hon. Charles W. Cohen, Major J. Brunei Gower, Sir Robert
Baldwin, Rt. Hon. Stanley (Bewdley) Colfox, Major William Philip Grace, John
Balfour, Captain H. H. (I. of Thanet) Colman, N. C. D. Graham, Fergus (Cumberland, N.)
Balniel, Lord Courtauld, Major J. S. Grattan-Doyle, Sir N.
Beamish, Rear-Admiral T. P. H. Courthope, Colonel Sir G. L. Greaves-Lord, Sir Walter
Beaumont M. W. Cranborne, Viscount Grenfell, Edward C. (City of London)
Bellairs, Commander Carlyon Crichton-Stuart, Lord C. Gretton, Colonel Rt. Hon. John
Betterton, Sir Henry B. Croft, Brigadier-General Sir H. Gritten, W. G. Howard
Bevan, S. J. (Holborn) Crookshank, Capt. H. C. Guinness, Rt. Hon. Walter E.
Birchall, Major Sir John Dearman Croom-Johnson, R. P. Gunston, Captain D. W.
Bird, Ernest Roy Culverwell, C. T. (Bristol, West) Hacking, Rt. Hon. Douglas H.
Boothby, R. J. G. Cunliffe-Lister, Rt. Hon. Sir Philip Hall, Lieut.-Col. Sir F. (Dulwich)
Bourne, Captain Robert Croft Dalkeith, Earl of Hamilton, Sir George (Ilford)
Bowater, Col. Sir T. Vansittart Dairymple-White, Lt.-Col. Sir Godfrey Hammersley, S. S.
Bowyer, Captain Sir George E. W. Davidson, Major-General Sir J. H. Hannon, Patrick Joseph Henry
Boyce, H. L. Davies, E. C. (Montgomery) Hartington, Marquess of
Bracken, B. Davies, Maj. Geo. F. (Somerset, Yeovil) Harvey, Major S. E. (Devon, Totnes)
Braithwaite, Major A. N. Davison, Sir W. H. (Kensington, S.) Henderson, Capt. R. R. (Oxf'd, Henley)
Brass, Captain Sir William Dawson, Sir Philip Heneage, Lieut.-Colonel Arthur P.
Briscoe, Richard George Dugdale, Capt. T. L. Herbert, Sir Dennis (Hertford)
Brown, Col. D. C. (N'th'l'd., Hexham) Eden, Captain Anthony Hills, Major Rt. Hon. John Waller
Brown, Brig.-Gen. H. C.(Berks, Newb'y) Edmondson, Major A. J. Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Buchan, John Elliot, Major Walter E. Horne, Rt. Hon. Sir Robert S.
Bullock, Captain Malcolm Erskine, Lord (Somerset, Weston-s. M.) Howard-Bury, Colonel C. K.
Burton, Colonel H. W. Everard, W. Lindsay Hudson, Capt. A. U. M. (Hackney, N.)
Butler, R. A. Falle, Sir Bertram G. Hunter-Weston, Lt.-Gen. Sir Aylmer
Cadogan, Major Hon. Edward Ferguson, Sir John Hurd, Percy A.
Campbell, E. T. Fermoy, Lord Hurst, Sir Gerald B.
Carver, Major W. H. Fielden, E. B. Iveagh, Countess of
Castle Stewart, Earl of Fison, F. G. Clavering Jones, Sir G. W. H. (Stoke New'gton)
Kindersley, Major G. M. Nield, Rt. Hon. Sir Herbert Southby, Commander A. R. J.
Knox, Sir Alfred O'Connor, T. J. Spender-Clay, Colonel H.
Lamb, Sir J. Q. Oman, Sir Charles William C. Stanley, Lord (Fylde)
Lambert, Rt. Hon. George (S. Molton) O'Neill, Sir H. Stanley, Maj. Hon. O. (W'morland)
Lane Fox, Col. Rt. Hon. George R. Ormsby-Gore, Rt. Hon. William Steel-Maitland, Rt. Hon. Sir Arthur
Leigh, Sir John (Clapham) Peake, Captain Osbert Stewart, W. J. (Belfast South)
Leighton, Major B. E. P. Penny, Sir George Stuart, Hon. J. (Moray and Nairn)
Lewis, Oswald (Colchester) Percy, Lord Eustace (Hastings) Sueter, Rear-Admiral M. F.
Little, Dr. E. Graham Power, Sir John Cecil Taylor, Vice-Admiral E. A.
Llewellin, Major J. J Pownall, Sir Assheton Thomas, Major L. B. (King's Norton)
Locker-Lampson, Rt. Hon. Godfrey Ramsbotham, H. Thomson, Sir F.
Locker-Lampson, Com, O. (Handsw'th) Rawson, Sir Cooper Todd, Capt. A. J.
Lockwood, Captain J. H. Remer, John R. Train, J.
Long, Major Hon. Eric Rentoul, Sir Gervals S. Tryon, Rt. Hon. George Clement
Lymington, Viscount Richardson, Sir P. W. (Sur'y, Ch'ts'Y) Vaughan-Morgan, Sir Kenyon
McConnell, Sir Joseph Roberts, Sir Samuel (Ecclesall) Wallace, Capt. D. E. (Hornsey)
Macdonald, Capt. P. D. (I. of W.) Rudd, Rt. Hon. Sir James Rennell Wardlaw-Milne, J. S.
Maitland, A. (Kent, Faversham) Ross, Major Ronald D. Ward, Lieut.-Col. Sir A. Lambert
Makins, Brigadier-General E. Ruggles-Brise, Lieut.-Colonel E. A. Waterhouse, Captain Charles
Margesson, Captain H. D. Russell, Alexander West (Tynemouth) Wayland, Sir William A.
Marjoribanks, Edward Saimon, Major I. Wells, Sydney R.
Mason, Colonel Glyn K. Samuel, A. M. (Surrey, Farnham) Williams, Charles (Devon, Torquay)
Meller, R. J. Samuel, Samuel (W'dsworth, Putney) Windsor-Clive, Lieut.-Colonel George
Merriman, Sir F. Boyd Sandeman, Sir N. Stewart Winterton, Rt. Hon. Earl
Mitchell, Sir W. Lane (Streatham) Sassoon, Rt. Hon. Sir Philip A. G. D. Wolmer, Rt. Hon. Viscount
Mitchell-Thomson, Rt. Hon. Sir W. Savery, S. S. Womersley, W. J.
Mond, Hon. Henry Shepperson, Sir Ernest Whittome Wood, Rt. Hon. Sir Kingsley
Monsell, Eyres, Com. Rt. Hon. Sir B. Simms, Major-General J. Worthington-Evans, Rt. Hon. Sir L.
Moore, Lieut.-Colonel T. C. R. (Ayr) Smith, Louis W. (Sheffield, Hallam) Young, Rt. Hon. Sir Hilton
Morrison, W. S. (Glos., Cirencester) Smith, R. W. (Aberd'n & Kinc'dine, C.)
Muirhead, A. J. Smith-Carington, Neville W. TELLERS FOR THE NOES.—
Newton, Sir D. G. C. (Cambridge) Smithers, Waldron Sir George Hennessy and Sir
Nicholson, O. (Westminster) Somerville, A. A. (Windsor) Victor Warrender.
Nicholson, Col. Rt, Hn. W. G. (Ptrsf'ld) Somerville, D. G. (Willesden, East)

Question put accordingly, "That the word 'seventy' stand part of the Question.

The Committee divided: Ayes, 274; Noes, 214.

Division No. 40.] AYES [11.12 p.m.
Adamson, Rt. Hon. W. (Fife, West) Chater, Daniel Hall, G. H. (Merthyr Tydvil)
Addison, Rt. Hon. Dr. Christopher Church, Major A. G. Hall, Capt. W. G. (Portsmouth, C.)
Aitchison, Rt, Hon. Craigle M. Cluse, W. S. Hardie, George D.
Alexander, Rt. Hon. A. V. (Hilisbro') Cocks, Frederick Seymour Harris, Percy A.
Alpass, J. H. Compton, Joseph Hartshorn, Rt. Hon. Vernon
Ammon, Charles George Cove, William G. Hastings, Dr. Somerville
Angell, Norman Cowan, D. M. Haycock, A. W.
Arnott, John Daggar, George Hayday, Arthur
Aske, Sir Robert Dallas, George Henderson, Right Hon. A. (Burnley)
Attlee, Clement Richard Dalton, Hugh Henderson, Thomas (Glasgow)
Baldwin, Oliver (Dudley) Davies, Rhys John (Westhoughton) Henderson, W. W. (Middx., Enfield)
Barnes, Alfred John Day, Harry Herriotts, J.
Barr, James Denman, Hon. R. D. Hirst, G. H. (York W. R. Wentworth)
Batey, Joseph Dukes, C. Hirst, W. (Bradford, South)
Bellamy, Albert Duncan, Charles Hoffman, P. C.
Benn, Rt. Hon. Wedgwood Ede, James Chuter Hopkin, Daniel
Bennett, William (Battersea, South) Edmunds, J. E. Hore-Belisha, Leslie.
Benson, G. Edwards, C. (Monmouth, Bedwellty) Horrabin, J. F.
Bentham, Dr. Ethel Edwards, E. (Morpeth) Hudson, James H. (Huddersfield)
Birkett, W. Norman Egan, W. H. Isaacs, George
Bondfield, Rt. Hon. Margaret Elmiey, Viscount Jenkins, W. (Glamorgan, Neath)
Bowen, J. W. England, Colonel A. John, William (Rhondda, West)
Bowerman, Rt. Hon. Charles W. Evans, Capt. Ernest (Welsh Univer.) Johnston, Thomas
Broad, Francis Alfred Foot, Isaac Jones, F. Liewellyn (Flint)
Brockway, A. Fenner Forgan, Dr. Robert Jones, Henry Haydn (Merioneth)
Bromfield, William Freeman, Peter Jones, J. J. (West Ham, Silvertown)
Bromley, J. Gardner, B. W. (West Ham, Upton) Jones, Rt. Hon. Leif (Camborne)
Brooke, W. George, Major G. Lloyd (Pembroke) Jones, Morgan (Caerphilly)
Brothers, M. Gibbins, Joseph Jowett, Rt. Hon. F. W.
Brown, C. W. E. (Notts. Mansfield) Gibson, H. M. (Lancs, Mossley) Jowitt, Sir W. A. (Preston)
Brown, Ernest (Leith) Gill, T. H. Kedward, R. M. (Kent, Ashford)
Brown, Rt. Hon. J. (South Ayrshire) Glassey, A. E. Kelly, W. T.
Brown. W. J. (Wolverhampton, West) Gossling, A. G. Kennedy, Thomas
Buchanan, G. Gould, F. Kenworthy, Lt.-Com. Hon. Joseph M.
Burgess, F. G. Graham, Rt. Hon. Wm. (Edin., Cent.) Kinley, J.
Burgin, Dr. E. L. Gray, Milner Kirkwood, D.
Buxton, C. R. (Yorks. W. R. Eiland) Greenwood, Rt. Hon. A. (Colne) Knight, Holford
Caine, Derwent Hall- Grenfell, D. R. (Glamorgan) Lang, Gordon
Cameron, A. G. Griffith, F. Kingsley (Middlesbro' W.) Lanebury, Rt. Hon. George
Cape, Thomas Griffiths, T. (Monmouth, Pontypool) Lathan, G.
Carter, W. (St. Pancras, S.W.) Groves, Thomas E. Law, Albert (Bolton)
Charleton, H. C. Grundy, Thomas W. Law, A. (Rossendale)
Lawrence, Susan Nathan, Major H. L. Smith, H. B. Lees-(Keighley)
Lawrie, Hugh Hartley (Stalybridge) Naylor, T. E. Smith, Rennie (Penistone)
Lawson, John James Newman, Sir R. H. S. D. L. (Exeter) Smith, Tom (Pontefract)
Lawther, W. (Barnard Castle) Noel Baker, P. J. Smith, W. R. (Norwich)
Leach, W. Noel-Buxton, Baroness (Norfolk, N.) Snell, Harry
Lee, Frank (Derby, N.E.) Oldfield, J. R. Snowden, Rt. Hon. Philip
Lee, Jennie (Lanark, Northern) Oliver, George Harold (Ilkeston) Snowden, Thomas (Accrington)
Lees, J. Oliver, P. M. (Man., Blackley) Sorensen, R.
Lewis, T. (Southampton) Owen, Major G. (Carnarvon) Stamford, Thomas W.
Lindley, Fred W. Palin, John Henry Stephen, Campbell
Lloyd, C. Ellis Paling, Wilfrid Strachey, E. J. St. Loe
Longbottom, A. W. Palmer, E. T. Strauss, G. R.
Longden, F. Parkinson, John Allen (Wigan) Sutton, J. E.
Lovat-Fraser, J. A. Perry, S. F. Taylor, R. A. (Lincoln)
Lowth, Thomas Pethick-Lawrence, F. W. Taylor, W. B. (Norfolk, S.W.)
Lunn, William Phillips, Dr. Marion Thomas, Rt. Hon. J. H. (Derby)
Macdonald, Gordon Ince) Picton-Turbervill, Edith Thurtie, Ernest
MacDonald, Malcolm (Bassetlaw) Pole, Major D. G. Tillett, Ben
McElwee, A. Potts, John S. Tinker, John Joseph
McEntee, V. L. Price, M. P. Tout, W. J.
McGovern, J. (Glasgow, Shettleston) Pybus, Percy John Townend, A. E.
McKinlay, A. Ramsay, T. B. Wilson Trevelyan, Rt. Hon. Sir Charles
MacLaren, Andrew Rathbone, Eleanor Vaughan, D. J.
Maclean, Neil (Glasgow, Govan) Raynes, W. R. Viant, S. P.
MacNeill-Weir, L. Richards, R. Walkden, A. G.
McShane, John James Riley, Ben (Dewsbury) Walker, J.
Malone, C. L'Estrange (N'thampton) Ritson, J. Wallace, H. W.
Mander, Geoffrey le M. Romeril, H. G. Wallhead, Richard C.
Mansfield, W. Rosbotham, D. S. T. Watkins, F. C.
Marcus, M. Rowson, Guy Watson, W. M. (Dunfermline)
Markham, S. F. Samuel, Rt. Hon. Sir H. (Darwen) Wellock, Wilfred
Marshall, Fred Samuel, H. W. (Swansea, West) Welsh, James (Paisley)
Mathers, George Sanders, W. S. West, F. R.
Matters, L. W. Sawyer, G. F. Westwood, Joseph
Maxton, James Scrymgeour, E. White, H. G.
Messer, Fred Scurr, John Whiteley, Wilfrid (Birm., Ladywood)
Middleton, G. Sexton, James Wilkinson, Ellen C.
Millar, J. D. Shaw, Rt. Hon. Thomas (Preston) Williams, Dr, J. H. (Llanelly)
Milner, Major J. Shepherd, Arthur Lewis Williams, T. (York, Don Valley)
Montague, Frederick Sherwood, G. H. Wilson, C. H. (Sheffield, Attercliffe)
Morgan Dr. H. B. Shield, George William Wilson, J. (Oldham)
Morley, Ralph Shield, Dr. Drummond Wilson, R. J. (Jarrow)
Morris, Rhys Hopkins Shillaker, J. F. Winterton, G. E.( Leicester, Loughb'gh)
Morrison, Herbert (Hackney, South) Shinwell, E. Wise, E. F.
Morrison, Robert C. (Tottenham, N.) Short, Alfred (Wednesbury) Wright, W. (Rutherglen)
Mort, D. L. Simmons, C. J. Young, R. S. (Islington, North)
Moses, J. J. H. Simon, E. D. (Manch'ter, Withington)
Mosley, Lady C. (Stoke-on-Trent) Sinclair, Sir A. (Caithness) TELLERS FOR THE AYES.—
Mosley, Sir Oswald (Smethwick) Sitch, Charles H. Mr. Hayes and Mr. William
Muff, G. Smith, Ben (Bermondsey, Rotherhithe) Whiteley.
Muggeridge, H. T. Smith, Frank (Nuneaton)
Acland-Troyte, Lieut.-Colonel. Buchan, John Davidson, Major-General Sir J. H.
Albery, Irving James Bullock, Captain Malcolm Davies, E. C. (Montgomery)
Alexander, Sir Wm. (Glasgow, Cent'l) Burton, Colonel H. W. Davies, Maj. Geo, F.(Somerset, Yeovil)
Allen, Sir J. Sandeman (Liverp'l., W.) Butler, R. A. Davison, Sir W. H. (Kensington, S.)
Amery, Rt. Hon. Leopold C. M. S. Cadogan, Major Hon. Edward Dawson, Sir Philip
Astor, Maj. Hon. John J.(Kent, Dover) Campbell, E. T. Dugdale, Capt. T. L.
Astor, Viscountess Carver, Major W. H. Eden, Captain Anthony
Atholl, Duchess of Castle Stewart, Earl of Edmondson, Major A. J.
Atkinson, C. Cayzer, Sir C. (Chester, City) Elliot, Major Walter E.
Baillie-Hamilton, Hon. Charles W. Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.) Erskine, Lord (Somerset, Weston-s. M.)
Baldwin, Rt. Hon. Stanley (Bewdley) Cazalet, Captain Victor A. Everard, W. Lindsay
Balfour, Captain H. H. (I. of Thanet) Cecil, Rt. Hon. Lord H. (Ox. Univ.) Falle, Slr Bertram G.
Balniel, Lord Chadwick, Capt. Sir Robert Burton Ferguson, Sir John
Beamish, Rear-Admiral T. P. H. Chamberlain, Rt. Hon. N. (Edgbaston) Fermoy, Lord
Beaumont, M. W. Christie, J. A. Feilden, E. B.
Bellairs, Commander Carlyon Cobb, Sir, Cyril Fison, F. G. Clavering
Betterton, Sir Henry B. Cockeril, Brig.-General Sir George Ford, Sir P. J.
Bevan, S. J. (Holborn) Cohen, Major J. Brunet Forestier-Walker, Sir L.
Birehail, Major Sir John Dearman Colfox, Major William Philip Fremantle, Lieut.-Colonel Francis E.
Bird, Ernest Roy Colman, N. C. D. Galbraith, J. F. W.
Boothby, R. J. G. Courtauld, Major J. S. Ganzonl, Sir John
Bourne, Captain Robert Croft Courthope, Colonel Sir G. L. Gault, Lieut.-Col. Andrew Hamilton
Bowater, Col. Sir T. Vansittart Cranborne, Viscount Gibson, C. G. (Pudsey & Otley)
Bowyer, Captain Sir George E. W. Crichton-Stuart, Lord C. Gilmour, Lt.-Col. Rt. Hon. Sir John
Boyce, H. L. Croft, Brigadier-General Sir H. Glyn, Major R. G. C.
Bracken, B. Crookshank, Capt. H. C. Gower, Sir Robert
Braithwaite, Major A. N. Croom-Johnson, R. P. Grace, John
Brass, Captain Sir William Culverwell, C. T. (Bristol, West) Graham, Fergus (Cumberland, N.)
Briscoe, Richard George Cunliffe-Lister, Rt. Hon. Sir Philip Grattan Doyle, Sir N.
Brown, Col. D. C. (N'th'I'd., Hexham) Dalkeith, Earl of Greaves-Lord, Sir Walter
Brown, Brig.-Gen. H. C.(Berks, Newb'y) Dairymple-White, Lt.-Col. Sir Godfrey Grenfell, Edward C. (City of London)
Gretton, Colonel Rt. Hon. John Makins, Brigadier-General E. Simms, Major-General J.
Gritten, W. G. Howard Margesson, Captain H. D. Smith, Louis W. (Sheffield, Hallam)
Guinness, Rt. Hon. Walter E. Marjoribanks, Edward Smith, R. W.(Aberd'n & kinc'dine, C.)
Gunston, Captain D. W. Mason, Colonel Glyn K. Smith-Carington, Neville W.
Hacking, Rt. Hon. Douglas H. Meller, R. J. Smithers, Waldron
Hall, Lieut.-Col. Sir F. (Dulwich) Merriman, Sir F. Boyd Somerville, A. A. (Windsor)
Hamilton, Sir George (Ilford) Mitchell, Sir W. Lane (Streatham) Somerville, D. G. (Willesden, East)
Hammersley, S. S. Mitchell-Thomson, Rt. Hon. Sir W. Southby, Commander A. R. J.
Hannon, Patrick Joseph Henry Mond, Hon. Henry Spender-Clay, Colonel H.
Hartington, Marquess of Moore, Lieut.-Colonel T. C. R. (Ayr) Stanley, Lord (Fylde)
Harvey, Major S. E. (Devon, Totnes) Morrison, W. S. (Glos., Cirencester) Stanley, Maj. Hon. O. (W'morland)
Henderson, Capt. R. R.(Oxf'd, Henley) Muirhead, A. J. Steel-Mailtland, Rt. Hon. Sir Arthur
Heneage, Lieut.-Colonel Arthur P. Newton, Sir D. G. C. (Cambridge) Stewart, W. J. (Belfast, South)
Herbert, Sir Dennis (Hertford) Nicholson, O. (Westminster) Stuart, Hon. J. (Moray and Nairn)
Hills, Major Rt. Hon. John Waller Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld) Sueter, Rear-Admiral M. F.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G. Nield, Rt. Hon. Sir Herbert Taylor, Vice-Admiral E. A.
Horne, Rt. Hon. Sir Robert S. O'Connor, T. J. Thomas, Major L. B. (King's Norton)
Howard-Bury, Colonel C. K. Oman, Sir Charles William C. Thomson, Sir F.
Hudson, Capt. A. U. M. (Hackney, N.) O'Neill, Sir H. Todd, Capt. A. J.
Hunter-Weston, Lt.-Gen. Sir Aylmer Ormsby-Gore, Rt. Hon. William Train, J.
Hurd, Percy A. Peake, Capt. Osbert Tryon, Rt. Hon. George Clement
Hurst, Sir Gerald B. Penny, Sir George Vaughan-Morgan, Sir Kenyon
Iveagh, Countess of Percy, Lord Eustace (Hastings) Wallace, Capt. D. E. (Hornsey)
Jones. Sir G. W. H. (Stoke New'gton) Power, Sir John Cecil Ward, Lieut.-Col, Sir A. Lambert
Kindersley, Major G. M. Pownall, Sir Assheton Wardlaw-Milne, J. S.
Knox, Sir Alfred Ramsbotham, H. Warrender, Sir Victor
Lamb, sir J. Q. Rawson, Sir Cooper Waterhouse, Captain Charles
Lambert, Rt. Hon. George (S. Molton) Remer, John R. Wayland, Sir William A.
Lane Fox, Col. Rt. Hon. George R. Rentoul, Sir Gervals S. Wells, Sydney R.
Leigh, Sir John (Clapham) Richardson, Sir P. W. (Sur'y, Ch't'sy) Williams, Charles (Devon, Torquay)
Leighton, Major B, E. P. Roberts, Sir Samuel (Ecclesall) Windsor-Clive, Lieut.-Colonel George
Lewis, Oswald (Colchester) Rodd, Rt. Hon. Sir James Rennell Winterton, Rt. Hon Earl
Little, Dr. E. Graham Ross, Major Ronald D. Wolmer, Rt. Hon. Viscount
Llewellin, Major J. J. Ruggles-Brise, Lieut.-Colonel E. A. Womersley, W. J.
Locker-Lampson, Rt. Hon. Godfrey Russell, Alexander West (Tynemouth) Wood, Rt. Hon. Sir Kingsley
Locker-Lampoon, Com. O.(Handsw'th) Salmon, Major I. Worthington-Evans, Rt. Hon, Sir L.
Lockwood, Captain J. H. Samuel, A. M. (Surrey, Farnham) Young, Rt. Hon. Sir Hilton
Long, Major Hon. Eric Samuel, Samuel (W'dsworth, Putney)
Lymington, Viscount Sandeman, Sir N. Stewart TELLERS FOR THE NOES.—
McConnell, Sir Joseph Sassoon. Rt. Hon. Sir Philip A. G. D. Sir B. Eyres Monsell and Major
Macdonald, Capt. P. D. (I. of W.) Savery, S. S. Sir George Hennessy.
Maitland, A. (Kent, Faversham) Shepperson, Sir Ernest Whittome

Main Question put, and agreed to.

Resolved, That it is expedient to raise to seventy million pounds the limit on the amount of the advances to be made by the Treasury to the Unemployment Fund under Section five of the Unemployment Insurance Act, 1921, as amended by subsequent enactments, which may be outstanding during the deficiency period,

Resolution to be reported To-morrow.

The Orders of the Day were read, and postponed.

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