UNEMPLOYMENT INSURANCE [MONEY] (No. 4).

HC Deb 18 July 1930 vol 241 cc1627-707

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

[Mr. DUNNICO in the Chair.]

Motion made, and Question proposed, That it is expedient to raise to sixty 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."—[Mr. Lateson.]—[King's Recommendation signified.]

The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. Lawson)

Events have once more compelled the Government to ask the Committee to sanction a Money Resolution as the preliminary to a Bill having for its object the raising of the borrowing powers of the Unemployment Fund to £60,000,000. That is regrettable, but, in the circumstances, I am afraid it is inevitable. The White Paper which is now in the possession of the Committee states in a simple, terse form the financial position as it stands to-day. Up to the present time the Treasury have advanced £43,330,000 to the Unemployment Fund. The limit of the Fund's borrowing powers is £50,000,000, and therefore the Minister still has borrowing powers to the extent of £6,500,000 in hand. On the other hand, the weekly outgoings are somewhere round about £450,000 in excess of the revenue, and to that has to be added the £1,000,000 for interest which must be paid at the end of September. The Committee will understand therefore, that the Government have to take steps to secure the Fund against contingencies Which may arise before the House meets next Session, and for that purpose the resources of the Fund are to be increased in the manner described in the White Paper.

From what one has seen in the newspapers, there is evidently some slight misapprehension about this White Paper. It is stated that the dates given there of the possible exhaustion of the borrowing powers cannot be accurate, because no allowance is made for the payment of interest. In the central column of the three sets of figures given in the White Paper, which shows the average weekly amount by which the outgoings will exceed the revenue, it was not possible for simplicity's sake, to set forth the payment of interest, which is made half-yearly; but I assure the Committee that in reckoning the dates given as the dates of exhaustion account has been taken of the payment of interest, and therefore it is not correct to say that the dates are not accurate.

Most Members of the Committee will be well aware of the steps the Government have taken in order to make the Fund financially sound. I should say that my right hon. Friend the Chancellor of the Exchequer has really made the boldest attempt to meet this situation which has been undertaken up to the present time. I have been a Member of this House for some years, and have followed the history of the Fund, and I know of no attempt which has shown such courage. The provision that was made might well have been sufficient to secure a proper relationship between expenditure and income, but for the phenomenal rise in the numbers of the unemployed. Reluctant as the Government are to increase the borrowing powers of the Fund, I think there will be general agreement that there is scarcely any other road out. In the debate on 28th March, the right hon. Gentleman the Member for Epping (Mr. Churchill) suggested that there was really nothing wrong in increasing the borrowing powers of the Fund to the extent of one year's income, and we are still in the position that these increased borrowing powers do not exceed that point.

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 fake such precautions as will ensure that the Fund is in a position to meet the calls which may be made upon it. As there is little indication of such a recovery at the present time as will make the existing borrowing powers sufficient, it has been necessary to ask the Committee for such powers as will provide an adequate margin of safety. In the debates which have taken place on the subject I have been struck by the feeling which though it was, I am sure, quite unintentional, yet did prevail, that the financial troubles of this Fund began with this Parliament.

Those who have been Members of this House since 1920 will, I am sure, agree that most hon. Members have become well accustomed to the salient points of this Motion. We have heard in the debates the same points put forward, in fact, we have become too familiar with some of those points. Each Parliament in succession has added a full share of fresh information in the debates. I will leave that point, because it is agreed that during this Parliament there has been very serious attention given to these Financial Resolutions, and to that extent there is no need to emphasise those points in order to remove the impression that the difficulties began during the present Parliament.

As a matter of fact the present Unemployment Insurance Scheme came into operation in November, 1920, And the financial difficulties began almost at its birth. The position then was that there was a balance of £22,000,000 in hand and that balance was exhausted in eight months. A Bill for giving borrowing powers to £10,000,000, was brought forward, and the first Bill was passed on the 3rd March, 1921. A second Bill increasing the limit to £20,000,000 was passed on the 1st July, 1921, and the third Bill was passed on the 12th April, 1922, raising the borrowing powers to £30,000,000. A fourth Bill was passed in 1928, raising the borrowing powers to £40,000,000, and the Bill passed earlier this year raised the amount to £50,000,000. I do not state these facts merely as a matter of controversy, but as actually showing what has taken place. I think it is necessary to state these facts in order to get proper proportion when we are discussing this serious and important subject. I think the Committee will agree that when the present Government came into office they had a very serious position to meet. There was at that time, as has previously been stated, a debt on the Fund of nearly £37,000,000. The average live register during the previous year bad been 1,291,000, and the revenue of the Fund could not provide for more than a million.

Although there is this second proposal during the Labour Government's lifetime to raise the borrowing powers, the position of the Fund is not entirely due to the original sin of this Government. I should like to say a word or two with regard to the people who participate in this Fund. Many questions have been asked concerning the position of the people who make up the unemployment totals on the register. Within the last few months I met some representatives of the chambers of commerce in this country, representative men in industry and commerce. The leader of those representatives was a gentleman who sat in this House on the Conservative benches for some years.

I ask the House to notice that those representative commercial men of the country put to me strong reasons why the figures for unemployment should be published monthly and not weekly. That was not a request from this party or that party, but from representative commercial men of the country, and they made this request for the reason which was emphasised by the right hon. Gentleman the Member for Epping (Mr. Churchill) in a previous debate, that the figures, as published, tended to create a false impression to the disadvantage of this country as compared with various countries abroad. I understand that something has been done on that side of the subject, and, as a result of the last debate, although we continue to publish the figures weekly, there has been an agreement that they shall be published monthly in a much more detailed form in the "Ministry of Labour Gazette."

I wonder how many Members of the House seriously read the statistics given in the "Ministry of Labour Gazette." I do not think the monthly statement which is now available receives that publicity which it might receive for the purposes for which it was intended. I would like to say that, although the figures may come as a surprise to some hon. Members, that does not make the unemployment situation or the lot of those who are suffering any (better, but at any rate it does correct the false impression which is created in the minds of people, not only in this country, but in other countries, by the way in which the statistics have been published in the past. The total figure of 1,933,454 at 7th July includes nearly 700,000 who are either on short time or suspended on the understanding that they will shortly return to work with former employers, but most of them have not been unemployed for many weeks. There is also the surprising fact that nearly 1,000,000 of the people on the register have had work within the past month. I think that fact disposes of the wrong impression that the 2,000,000 standard which hon. Members say we are approaching is a standing army in which there is no variation whatever.

Mr. WARDLAW-MILNE

May I ask the hon. Gentleman a question before he leaves that subject? I am sure it would be very interesting to the Committee if he would tell us whether there has been any Change in the definition of "temporary"—if he would tell us exactly what "temporary" means in relation to the 700,000 persons to wham he has referred.

Mr. LAWSON

There is no change in the definition of "temporary." Those who are classed as temporarily unemployed are people who expect to return shortly to the same employer, and none of these persons have been unemployed for more than six weeks. If there is no definite understanding that they are to return to their former work within six weeks, they are classed as wholly unemployed. There are, however, among the permanently unemployed, large numbers who may have been working last week. They are permanently unemployed because they are definitely discharged and without an employer. There is sometimes an impression that the great mass of those who are unemployed have been unemployed for years, but, as a matter of fact, only some 8 per cent. of the males and 2 per cent. of the females have been unemployed for 12 months or more. That means that the number who have been unemployed for more than 12 months is limited to some 120,000 of the total who are unemployed.

Dr. VERNON DAVIES

That is totally unemployed?

Mr. LAWSON

Yes. I do not know that I need enlarge any further on that point, except to say that, irrespective of any party advantage to which hon. Members opposite are entitled, there must be sooner or later, in accordance with the representations of commercial men and all the best interests of the country, a much more effective presentation of the figures which go to make up the great list of unemployed in this country. I do not wish to take up any more time, because I understand that it is not desired that we should have a very long Debate on this matter to-day, but I wish to say, in conclusion, that in these sad and difficult times in various parts of the country there is a very sombre state of things and a very solemn atmosphere. Indeed, it is possible, in going from one part of the country to another, almost to think that one is travelling in different countries, rather than in different areas of the same country, so different are the conditions; but there will be no two opinions in the House that, whatever suggestions may be made during this and other Debates in regard to dealing with this problem, money must be found to carry on the services of this great Fund. It would have been an ill thing for the country in this great crisis if there had not been such a Fund. It is to the credit of those who established it, irrespective of party. Therefore, the Government have decided in the manner set forth in the White Paper, that the only possible policy' that they can pursue at the present time is to ask the Committee to give its sanction to the raising of the borrowing powers of the Fund.

Sir ARTHUR STEEL-MAITLAND

I have listened very attentively to the speech of the Parliamentary Secretary to the Ministry of Labour, and there are a, few sentences in it which I think deserve real attention. The first was the remarkable sentence that in fact the income of the Fund would have been all right if, unfortunately, the expenditure of the Fund had not gone up so greatly. That constituted practically the whole defence of the Government, as contained in the hon. Gentleman's speech, except only for one or two other sentences which stood out in a somewhat coruscating way. [Interruption.] One brilliant remark—if hon. Members prefer that expression—was that it was not for him to make any predictions about unemployment in the future. That is a wonderful discovery, made about 15 months too late. The next was as to how bold the attempts of the Chancellor of the Exchequer had been when meeting the financial situation. It is indeed extraordinary boldness, especially as typified in the steps, in which the Chancellor of the Exchequer has been the leader, with regard to the situation in Nottingham, which, as we are discussing the causes of this increased unemployment, are particularly material to our discussions.

Apart from that, since this is an occasion on which we are, naturally, debating the reasons which have led to this demand for money, I might point out that the only thing which the Parliamentary Secretary has stated is that unfortunate and regrettable events have forced the Government to come for further borrowing powers. One would at least have imagined, after the record of the Government in condemning borrowing, that the hon. Gentleman, in asking for a further extension of borrowing powers, would have given us some idea of what those regrettable events were which gave rise to the need for this additional borrowing. On that subject, however, he has been completely silent, and perhaps, if the Committee will allow me, as he has been completely silent, I might make one or two remarks on the subject as if they were a continuation of his own speech, if,, indeed, he was wishing to give to the Committee the full facts of the situation.

If the hon. Gentleman had really gone on with his speech, or if the Minister, in his place, had gone on to deal with the full facts of the situation, they would have done it somewhat upon these lines: "It is quite true that here on the Treasury Bench we much regret this increase in unemployment. Of course we say, in all our speeches in the country and in the House, that it is due entirely to the great fail in prices of natural products, which has caused unemployment and led to a greater demand for money. But, in fact, as we who have Government information at our disposal know quite well, that fall in prices, while partly responsible, is only a very convenient smoke-screen behind which to conceal the whole of the rest of the causes that are operating to make us bring forward this demand."

"What are those causes? Granting the effect of the fall in prices, if I were giving the truth as a member of the Government, I should have to add that, if this fall in prices caused depression, surely that would be an occasion on which at least the Government would be exceedingly careful—careful beyond any other time—to avoid adding anything to the anxieties and apprehensions of the commercial community." Consequently, I should have to confess, if I were continu- ing the hon. Gentleman's speech, that my colleagues in the Government had grossly failed from that point of view, at a time when they should have been careful not to add to the apprehensions of the commercial community. I should have to say, "Look at the action that has been taken by them. Look at the action of my colleague the President of the Board of Trade. Here is a Minister, an old Free Trader, who, as a cardinal point in his belief, says that Free Trade is good because it sees that nothing shall be added to the cost of production; and yet my colleague the President of the Board of Trade chooses this opportunity, of all occasions, when he should have been careful to do nothing of the sort, to bring forward a Coal Bill that will add to the cost of the production, and add to the anxieties of every manufacturer in the land. Then look at the action of my colleague the Chancellor of the Exchequer. Here, at a time when, with the fall in prices, you want to be particularly careful, he comes forward with increases in taxation." With those increases in taxation I will deal in one sentence only. Their result, as everybody in the City knows, and as the Chancellor of the Exchequer knows, or, if he does not know, he ought to know, are of an importance far beyond their actual amount, owing to the uncertainty and anxiety which they cause. "Not only so but, when it comes to a question of loans, my colleague the Chancellor of the Exchequer, when the Finance Bill is coming on next Thursday, is going to show his really austere uprightness by passing a Clause in the Finance Bill in which he preserves intact the Sinking Fund and even adds to it." Yet the person who so dislikes borrowing is the person who is at present borrowing at the expense of industry. I have here a description by another colleague of that very Act. That was before we came into power. The Minister does not merely say, 'Let us borrow,' but 'Let industry borrow.' That is the idea, to put it all on our depressed industries. That is the real financial sin, that industry is paying too high taxation for social services. That is the kind of statement which the Parliamentary Secretary, if he was telling the whole of the causes would have made, or he would have made one other and, it is this. "Another of the reasons why we have to come for these fresh borrowing powers is the ghastly results of the recent Unemployment Act that we passed in the early months of this year. Of course, those results would not have been so bad if we had had the courage to stand up to the pressure put upon us during the passage of that Act but, of course, the trouble of an occasion like that was the inconvenience of the kind of allies on whom we rely in the House. We never know whether on a given occasion they are going to double-cross us or not."

Sir HERBERT SAMUEL

Why does the right hon. Gentleman use the word "allies"?

Sir A. STEEL-MAITLAND

I am using the word, and I repeat it. Have there been no conversations between the right hon. Gentleman and the party opposite as to what would happen if he voted against them? If the right hon. Gentleman does not answer, and if there have been conversations of the kind, I repeat the word "allies." I let him quarrel if he wishes, but I stick to it.

Sir H. SAMUEL

I understood the right hon. Gentleman suggested that the party here entered into an alliance with his own party. He said the trouble was that the party did not know when they could rely upon their allies, who had double-crossed them.

Sir A. STEEL-MAITLAND

I am sorry if I did not make it clear. I was making a few remarks which the Parliamentary Secretary should have added, and, putting words into his mouth, I said that he might have continued by saying "One of our difficulties on the previous occasion of the passage of the Bill was the difficulty that we, as a Government, had in the matter of the action of our allies."

Sir H. SAMUEL

It would be better if the right hon. Gentleman spoke for himself.

Sir A. STEEL-MAITLAND

The right hon. Gentleman is very sensitive this morning.

The DEPUTY-CHAIRMAN

We are getting rather far from the Money Resolution before the Committee.

Sir A. STEEL-MAITLAND

I am dealing with the causes that led to the repeal of the "genuinely seeking work" Clause and the substitution for it of the present disqualification, which is one of the reasons for the increase in the number of claimants and the benefit paid, and, therefore, of the directly increased demand for money. I am sure you would allow me, Sir, when I have had a personal statement made to me to reply to the right hon. Gentleman who makes it, and who says I should speak for myself, that he should not take upon himself to speak for other people.

Mr. TINKER

On a point of Order. Some of us are going to take part in the debate if we get a chance, and we want to follow the argument. Has the right hon. Gentleman the right to speak in the second person, as he has done all the morning?

Sir A. STEEL-MAITLAND

The ghastly results of the Unemployment Act are these. No one was satisfied with the old condition of "genuinely seeking work." It was quite right that it should be altered. On the other hand, to alter it in the way it has been altered has led to a state of affairs that can only be described as ghastly. If anyone could make an inquiry at the exchanges, and if the exchange officials could speak their mind, I am quite sure they would echo precisely the same sentiments that I have been uttering. In a large number of cases, in place of "not genuinely seeking work," the condition "not normally insurable," which was little heard before as a condition of disqualification, is now coming into prominence and largely taking the place of "not genuinely seeking work."

The DEPUTY-CHAIRMAN

I must remind the right hon. Gentleman that the money asked for in this Resolution is exclusively for those persons who have paid 30 or more contributions. It does not include any of those who are covered by the separate transitional period Exchequer grant to meet the charges. The borrowing powers proposed are restricted rigidly, I am advised, to such persons as have paid at least 30 contributions.

Major ELLIOT

Surely the burden on the Fund is increased.

Mr. BUCHANAN

May I submit that "not normally insurable" may and does operate on the people that this money is being voted for, and, consequently, it can be raised in that respect. Further, may I ask if there is not a gap between the Treasury making their grant for the purpose of the normal when the money is devoted even to the not normal until the Exchequer make the grant, and therefore to divide it between the two is a totally impossible problem. The money is paid out, and there is an adjustment at the end of the year.

Mr. T. WILLIAMS

Is it not the case that the borrowing powers are being extended exclusively to meet the case of those who have 30 stamps and that not a single penny piece of the extra £10,000,000 will go to persons who have fewer than 30 stamps on their card? That is the situation, since those with less than 30 stamps receive their benefit direct from the Treasury.

The DEPUTY-CHAIRMAN

I realise the difficulties of a restriction discussion such as this within narrow limits but I would point out that the money asked for in this Motion is to be used exclusively for those who may have made 30 or more payments and it does not cover those who come within the transitional period in respect of whom there is a special provision.

Major ELLIOT

The point which has been put by the hon. Member for Gorbals (Mr. Buchanan) is perfectly sound that the burden of this fund is diminished in so far as the persons are disqualified, and that "not normally in an insurable occupation" is a condition not merely for those who have exhausted their stamps but for those who have not done so. We are all acquainted with cases of the kind and therefore the whole question of this qualification comes properly into the debate which have now embarked upon.

The DEPUTY-CHAIRMAN

That is a technical point. I am laying down the general principle by which the Committee must be guided and upon which I must base my Rulings.

Mr. CHURCHILL

I do not gather from you in the remarks which have fallen from you, Mr. Dunnico, that you wish that the debate should be limited in any way other than the debate has been limited on a previous Money Resolution preceding the extension of the borrowing powers which has already been discussed this Session and which, surely, affords a precedent for a general discussion upon this grave matter.

The DEPUTY-CHAIRMAN

I agree that in cases like this, where the amount asked for is substantial, it is quite legitimate that the Committee should discuss in a, general way the causes, and so far as I am concerned I shall allow it.

Mr. ERNEST BROWN

As this Motion is based on Section 5 of the Act of 1921 as amended by other Acts has it not been the custom of the Chair in all discussions to allow all germane things affecting either the rise or the fall of the fund to be discussed? On the 28th of March, when a similar Motion was moved by the Minister of Labour you, Mr. Dunnico, and the Chairman of Ways and Means allowed the fullest discussion of all the subjects which were really germane to the demand for the money.

The DEPUTY-CHAIRMAN

I cannot recall definitely what took place on that occasion, but, obviously, there must be restrictions. I remember that, we had to rule definitely that the question of fiscal policy and tariffs could not be discussed as well as a number of other matters. There is hardly any subject which cannot be brought in as a cause of unemployment, and the Chair must exercise common sense in this matter.

Mr. CHURCHILL

Accepting at once all that you have said, Mr. Dunnico, may I, with great respect, bring to your notice the fact that there is a general desire in all quarters of the Committee—I do not say a unanimous desire, but a general desire—that the discussion should be of such a character as to enable the real main issues affected by this Motion to be discussed. Whilst I understand that you have thought it necessary to mention that there should be a specific and technical limitation, could you not, as far as unemployment and unemployment alone is concerned, meet the wish of the Committee and allow the Debate to be at least as general as the debate on another Motion of an exactly similar character which has taken place earlier in the same Session?

The DEPUTY-CHAIRMAN

The Chair is always ready to meet the wishes of the Committee in these matters, but it must be borne in mind that we cannot discuss the transitional period which is met by a special Exchequer grant.

Sir A. STEEL-MAITLAND

We always recognise that you are anxious, Mr. Dunnico, to meet the wishes of the Committee within a reasonable interpretation of the Rules of the Order, and we wish to abide by your Ruling. That was the reason why, when the Parliamentary Secretary was making his speech and when he dealt, during the latter part of his speech, with the position of the figures upon the live register, I would have been the last person to suggest that it was not strictly within the Rules of Order and material to this question. I had no wish, and the Committee would have no wish, unduly to restrict the bounds of discussion, but in this question, as the hon. Member for Gorbals (Mr. Buchanan) has stated, the action which was then taken has an effect upon the money required to-day as well as upon the Treasury grant. What has been happening in that respect is that we have had causes for disqualification used now in a way in which they were never before used. It may be, as we were told, that the percentage is not quite the same, but the substitution of "not normally insurable" as a cause of disqualification for the old genuinely seeking work is quite evident. For six months now we have really been having government by subterfuge, and when you have government by subterfuge you get results which are not satisfactory to people of very widely differing points of view indeed.

I take the point of view of the hon. Member opposite and his friends who have raised the question with regard to Glasgow. Again, it affects the amount of money required. It means that men who are long out of a job now find it infinitely more difficult to get a job, and therefore they are burdens upon the fund. As the weeks go by it becomes more and more difficult for them to get a job, and they become a burden upon the fund and create additional need for money. It is the more so when the Minister herself, when she is talking about the system of placing, continually says, "We always offer the best men," and the test of the best men is very largely those who have been most in work. Therefore, by her own showing, when the test has to be an offer of a job, by her very system she is cutting out more and more the people who have been out of work for some considerable time. On the other hand, it is equally true—and this is a point of view which hon. Members opposite may not share, but which, I think, most people do share—that people come upon the fund who ought not to do so, because they prejudice the Fund for the benefit of the decent men who contribute. [An HON MEMBER: "Why decent?"] Because always there are the decent men contributing to the Fund. Does anyone deny that fact?

Mr. HARDIE

Surely a man is not indecent because he is out of work.

Sir A. STEEL-MAITLAND

I did not say so. I am not implying that for a moment. What I meant to imply is that, just as there are a lot of decent men out of work, so everyone recognises that at this moment there are a large number of people, not a large percentage, but a large number in the aggregate, who are really trying to live upon the Fund. The effect of this system of government by subterfuge would, under any Government, have the effect of keeping under and not giving a chance to men who have been out of work for a long time, and would have the effect of letting in men who ought never to be upon the Fund and who were, therefore, only a burden upon it and upon the contributors too. That is the effect at the present moment.

With regard to the other reason for this need for money I would only ask the Government two questions in conclusion. We have had immense sums of money spent upon unemployment schemes. The defence of the Government is that a great deal of employment is thereby given and that, therefore the workers concerned have not to be supported out of the fund. They have never proved their case. The Chancellor of the Exchequer has always said that he does not believe that these schemes are any remedy for unemployment. He has stated that they only add to the unemployment position itself later on. Why? Because when the particular piece of road making, or whatever it may be, is finished, the men are out of work again. They have been away from their particular trades. They have lost their particular skill, if they are men in a skilled trade, and you get them back upon the Unemployment Fund not only as a fresh obligation but really a worse one, because they have been less able to pursue their own trades than previously.

We have a right to ask the Government, when they come a second time for these borrowing powers, what opinion they have had given to them by their own Economic Council, either as regards the unemployment schemes or as regards the action that they are taking respecting the lace trade in Nottingham, or the trades which hitherto have been safeguarded. I am not going to transgress in dealing with the fiscal question on its merits, but here we have two points of discussion, each of which may be outside the ambit of this Resolution and yet they vitally affect the question. Have the Government obtained the opinion of the Economic Council on the unemployment scheme, and have they obtained it on Safeguarding? If they have such a Council, at least the Committee is entitled to know what their opinion is. Meanwhile, the way in which they have been dealing with the unemployment question, by subterfuge, shows that if ever democracy was on trial it is so to-day.

We are in an extraordinary difficult position. That is the one point on which I agree with the Parliamentary Secretary. We are going forward, first of all the countries, on a new path, with a wide franchise, and having to deal with these difficult questions of economics. This is one of the occasions where it makes all the difference how the Government faces up to the situation, whether it is going to go really and truly into the case to-day, and whether it is going to state the truth with regard to remedies that, have been proposed, whether it is going to have them considered quite impartially and without prejudice, and whether it is going to go forward in its administration in the only way by saying what it means to do, and doing it. That is the only safeguard for progress and economy in times of stress like these.

Mr. E. BROWN

I could have wished that the right hon. Gentleman had been as careful in his statement on some points as he exhorted hon. Members opposite to be in the handling of the Insurance Fund. There can be no doubt that a balanced view of the effect upon the Fund of any action taken by this House in previous Acts would not bear out what the right hon. Gentleman says. As a private Member, I may be accused of knowing very little about this matter, but I would like to quote the Minister of Labour, and to agree with her from my own experience in my own constituency and in other places where I have made investigations. Speaking on the 28th March, she said: The Opposition may say, and a good many people have already said, that the phenomenal rise of the figures is due to the operations either of my administration or of the new Act, or of both combined. I want to make it clear that that would be an entirely erroneous conclusion. The new Act only came into operation on the 13th March and the actual practical working of it will take some months to demonstrate the exact effect upon the life register."—[OFFICIAL REPORT, 28th March, 1930; cols. 785–786, Vol. 237.] I have a great admiration for the logical faculties of the right hon. Gentleman, but to-day he was not as logical as usual. He spoke of the 58 Members who sit here below the Gangway, as is the custom of most hon. Members when they are in trouble. It is extraordinary the importance that 58 Liberal Members seems to have in this House. When anybody wants to blame anybody for anything it is not the majority on that side of the House or on this side of the House that is blamed, but it is the 58 Liberal Members who are blamed. We must be a very remarkable body of people, and I have no doubt that the people outside will note that. To come back to the right hon. Gentleman and his logical faculty. First of all, he said: "Those wretched Liberals below the Gangway"—I am using my own picturesque language and not his dialectical language—"are responsible for the whole trouble because of their spinelessness in regard to the previous Act." Then he began to say, before he was interrupted from the Chair, that all that is happening is that people who used to be turned off the Fund because they could not fulfil the condition of "genuinely seeking work" are being turned off now because they are not "normally seeking employment." The right hon. Gentleman cannot have it both ways.

What has happened has been this, that because of the overstatement in the newspapers and because of what the right hon. Gentleman the Member for Epping (Mr. Churchill) and his friends have said about this matter, people have got the idea into their head that all that they have to do is to go on to the register of the exchange and draw their money for nothing. The overstatements of the right hon. Member for Epping are always dangerous, because his language is so delightful and flam-buoyant that you cannot help reading it. Nobody takes any notice of the duller statements of some of us, but people do take notice when the right hon. Gentleman states in this House, and states outside, that hundreds of thousands of people have been thrown on to the Fund because of the recent Act, and when the newspapers delight in headlines such as "Dole drawers," etc. The "Weary Willies" and the "Work-Shy," which used to be their slogans of pre-War days, have now given place to the slogan of "The Dole Drawers." No wonder that people get the idea that all they have to do is to register and draw their money.

12 n.

The fact is, that the recent Act has done very little, so far as my experience goes, to add many to the Fund. What it has done has been to bring into operation something that was practically a dead letter. Let me give facts and not imagination. Two years ago in Leith, in six months, 27 persons were cut off the Fund because they were not normally insurable. In the first six months of the present year, to the end of June, there were 357 persons cut off the register. That shows that there is very little substance in the extraordinary and extravagant statements made by the right hon. Gentleman. I suggest that for the sake of the unemployed and for the credit of the nation he should cease talking in this extraordinary way about the army of dole drawers.

Sir A. STEEL-MAITLAND

I am sure the hon. Member does not wish to misrepresent me. He says that I am misrepresenting the position. On the contrary, he is supporting my statements. I say that both from the point of view of the hon. Member for Gorbals (Mr. Buchanan) and the hon. Member for Leith (Mr. E. Brown) this Act has largely substituted "not normally insurable" for "not genuinely seeking work," as the test.

Mr. BROWN

I made the same point in discussing the Bill. The right hon. Gentleman cannot have it both ways. He cannot at one and the same time accuse us of loosening the ties of the Unemployment Fund, and then say that we have enabled some other tie to be brought into operation. The gravity of this Resolution is its inevitableness. We all agree that we must not put on another penny more taxation, and therefore the gravity of the whole thing is that this Resolution is inevitable. The balance will run out before we meet again in the autumn. The payments must be made. It is a very serious position. Let me quote from the statistics with regard to Scotland to show how serious it is. On the 16th of June there were 1,266,670 insured persons. Of these, 19 per cent. men were unemployed, 12.9 per cent. women, and 9.1 per cent. juveniles, an average of 17.4, which is 6.3 per cent. greater than the figures of a year ago.

Let me give two illustrations from these figures. In Edinburgh there were 94,310 insured persons on the 16th of June last; 12.9 per cent. men unemployed, 8.1 per cent. women and 4.8 per cent.. juveniles; an average of 10.9 per cent., which is 2.2 per cent. larger than a year ago. In my own division of Leith there were 24,730 insured persons; with 24.3 per cent. men unemployed, 18.6 per cent. women and 8.5 juveniles, an average of 21.7 unemployed persons,, or 3.9 per cent. greater than a year ago. These figures should give the right hon. Gentleman cause to pause. My own constituency has had an average of unemployment of over 5,000 since 1920. Only once has it dropped below 5,000, and if what the right hon. Gentleman says about loosening the ties is correct there would have been an enormous growth in the number of men who have been persistently out of work, not because they desire to be dole drawers, but because the conditions in the Baltic and the conditions of trade with Russia have made it impossible for these men to get back to their previous work. If my Scottish friends will look at the last return on unemployment they will find one or two startling things. I was amazed to see in a county like Angus that there had actually been a rise of 13.7 per cent. and in a city like Dundee a rise of 14.7 per cent.

I need quote no more figures to show the gravity of the problem. It is not because there has been an alteration in the regulations, although it may have had some effect, but it has not had the exaggerated effect which hon. and right hon. Members have suggested. What is wrong is that we are now carrying out a policy of maintenance. [An HON. MEMBER: "Partial."] Hon. Members opposite know my views about that, and I know theirs, and they should be the last persons to say anything about it. When hon. Members on the back benches opposite moved the full scale of relief, the Government and hon. Members who are now objecting to my statement turned it down so that they have no right to say anything about that at all. This Financial Resolution should bring the Committee and the country to realise that maintenance is not enough. On only two or three occasions during the last 20 years has one Bill been absent from the Table of the House, the Bill known as the Right to Work Bill. The late Mr. Keir Hardie brought in the first Right to Work Bill when he tried to make the 1905 Act obligatory. Every year since then, except the war years and 1919, 1924, and this year, we have seen that Bill.

I suggest that this Financial Resolution should give every single Member of this House furiously to think as to whether we ought to borrow money in this way to keep the Fund solvent, but rather to borrow money, if borrowing is necessary, for works of national development, not relief works,, so that we may put men to work and show that this House believes that a policy of maintenance is not enough. It is with the greatest regret that we have to support such a Resolution. I hope never to see another, but I must confess that my hopes run dim. I hope the Minister of Labour will bring to the notice of the Treasury and the Chancellor of the Exchequer the clamant demand in the country for some constructive effort on a national scale, not a local scale, for dealing with this problem and to prove that maintenance is not enough.

Mr. BUCHANAN

This is perhaps one of the most tragic debates upon which this Committee can enter. I listened to the speech of the Parliamentary Secretary in the hope that he would announce one or two things. When the present Act was going through, various criticisms were made by hon. Members who sit on these back benches. We insisted on certain alterations in the scales of benefit and the hon. Member for Wolverhampton West (Mr. W. J. Brown) criticised the financial structure of the Measure. We were met with the reply that the Bill was not the last word of the Government on unemployment insurance, that they were exploring and investigating the problem, going into it day by day. I want to ask what has been the result of those investigations. We asked for the result a those investigations last March, and if we do not get a reply to-day it will mean that we shall get no reply until next November. It is said that we must be careful that we do not give an unemployed man more than a man who is at work. When was that discovery made? In their evidence to the Blanesburgh Committee the Prime Minister and other Members of the front bench, pledged themselves to increase the scales of relief.

The DEPUTY-CHAIRMAN

We cannot discuss the increase of scales of relief on this motion.

Mr. BUCHANAN

I am not discussing the scales of relief. A pledge was given when the Bill was introduced that the Government would review not merely the scales of relief but the whole ramifications of unemployment insurance and I want to know what progress is being made, who are the committee, how often they have met, and, lastly, when we are likely to have their report? I think it is important, because every few months we are faced with a Bill of this kind. I see that in the White Paper an estimate is given as to how long the money will last. It states that if the live register is less than 1½ millions the fund will last to a date in 1932, and that if the life register is at 1,900,000 the fund will last to a date in 1931. But mark this: This is an assumption made on certain figures. But if every one or almost every one in this House who speaks on the subject is correct, the figure is not likely to remain at 1,900,000 but is likely to grow. That is not merely an indictment of the Government, but an indictment of modern capitalism.

For the first time since I can remember, the figures during the summer months have constantly risen. I have been alarmed at the growth of the figures dur- ing the summer months, for in our most disappointing years the figures have fallen at such a time. No hope can be held out that the coming winter is likely to be the first winter when there will be a decrease in the figures. We must assume that the numbers will increase. I would ask the Minister how long the Fund will last if the figure becomes 2,250,000. That is not an unfair figure to take. There are now 1,900,000 unemployed at a time when the building trade is working, when the seasonal trade is working and the coast towns are busy. Generally, these summer months are the best months of the year for trade. Therefore my question is not an unfair question to ask. Will the Fund last to the end of the year if by November the register reaches 2,250,000?

Let me turn for a moment to a remark made by the right hon. Gentleman the Member for Tamworth (Sir A. Steel-Maitland) from the Conservative Front Bench. He said that officials of the Employment Exchanges up and down the country, when asked the question, replied that they did not like the present administration. What authority has he for saying that? What officials have made this statement? If I made a statement like that I should be immediately asked what was my authority for it. Who has told the right hon. Gentleman? From what Exchange has he gathered the information, and on what experience is the statement formed? What I gather about the officials is that they are unchanged from the time when the right hon. Gentleman had control of them. The official who was cruel before remains cruel now, and the official who was decent before remains decent now. There is not one scrap of change. Can the right hon. Gentleman give one illustration to show that the officials are not working and utilising the Act to disqualify people? Have they not utilised a Section of the Act with a cruel vindictiveness equal to the "not genuinely seeking work" provision? What justification has the right hon. Gentleman for his statement? Is it merely loose thinking and loose thought? Can he show any justification for making a wrong statement? None, not the slightest justification.

The right hon. Member for Epping (Mr. Churchill), as the hon. Member for Leith (Mr. E. Brown) has pointed out, uses extravagant language. I blame the right hon. Member for Epping, plus almost the cowardice of the present Minister of Labour and the officials for having given way to the language of the right hon. Member for Epping. What did that right hon. Gentleman say some time ago? This is part of my indictment of the administration. He said some time ago, amid hot protests from our front bench and from our back benches, that the officials were afraid to refuse benefit, that they were giving benefit wholesale without any regulation to justify it. What has happened is this: Not one single Member on these benches ever thought that "not normal" would be used. But in order to satisfy the right hon. Member for Epping, in order to show that the officials were neutral and were not giving the unemployed too much, in order to give way to the newspaper clamour—

The DEPUTY-CHAIRMAN

The discussion is taking a very wide scope. After all, the question before the Committee is whether permission should be given for this increased loan. It is in order to discuss reasons for or against, but it is not in order to discuss the merits of the Act itself.

Mr. BUCHANAN

I am discussing the cause of the increase. I do not wish to be in the slightest way disrespectful to you, for I recognise your ruling at the start of the debate. Let me turn to the White Paper. The last paragraph says:— The amounts by which the outgoings of the Fund with various numbers on the Live Register will exceed the revenue of the Fund and the dates by which the limit of £60,000,000 of borrowing powers would be reached are given in the following Table, but uncertainty as to the number out of the whole who would be entitled to transitional benefit makes it necessary to submit the Table with reserve:— That shows that the whole thing is bound up with the fund. Even the White Paper cannot give an accurate estimate; it can give only a figure with reserve. The right hon. Member for Epping and the newspaper campaign—

The DEPUTY-CHAIRMAN

I do not want any misunderstanding to occur. The phrase quoted does not in any way affect my previous Ruling. This increased loan now asked for, I am advised, is confined to those unemployed persons who have made 30 payments or more.

Mr. BUCHANAN

Let me turn to the financial aspect, on which I might possibly be in order. Suppose I cannot help myself in these matters, but I am one of those who are constantly taunted with the suggestion that there ought to be clever people on commissions. I hope I shall not be casting up the past by referring to the Blanesburgh Committee. If ever figures proved anything those figures prove that that Committee did not know its business. It was an incapable Committee and every member of it ought to have been condemned and exiled from public life. These figures show it. What are the facts? We are now discussing finance and those without 30 stamps are outside this calculation. We are here only dealing with those who have the 30 contributions and, yet, even leaving out those who have been a long time out of employment, on this financial calculation the present contribution cannot meet the interest or anything like it. But this Committee some years ago actually suggested that some day, perhaps a year or two ahead, we should be able to reduce the contributions from the employers, the employed and the State. I disagree with the hon. Member who spoke from the Liberal benches in regard to his outlook on unemployment. I cannot see any reason for believing in his party's policy about roads. I have not met anybody yet who wants roads. I know people who want boots and clothes and houses and food, but except for a mad motorist here and there, I have not met anybody who wants roads and my policy has never been linked up with the demand for roads. I have only demanded one thing and that is an income for the working classes.

My indictment is twofold. We hear a great deal about the burden on industry. Now it is proposed to increase these borrowing powers from £50,000,000 to £60,000,000. What are you doing thereby? You are giving to the rentier class, to the interest class, a, free gift and you are asking the man earning £2 5s. a week to pay an increasing share of interest on that sum. There must be no increase in the Income Tax because we are told those who pay Income Tax could not bear it. But the man with £2 5s. a week is to be called upon to bear this increased charge. It is an unfair thing, a mean thing, a contemptible thing to do. The unemployed man or the workman with £2 a week has no right to be called upon to pay interest to a rich class. He has not enough with which to feed his family and it is cowardly to take it from them. We have not the right to increase these borrowing powers as much as we have the right to go the class which has the surplus wealth and say "This is a national problem. It is not the problem of the bricklayer, but the problem of the schoolteacher, the civil servant, the landowner, the millionaire. It is a national problem and the nation ought to face up to the duty of keeping its unemployed decently and well." Instead of that we are here asking for an additional £10,000,000 by this method, and we are throwing the chief burden on the poorest section of the working class. That is contrary to Labour principles, contrary to Labour ideas of government, contrary to the Labour outlook. The Government by this time, 14 months after taking office, ought to be in a position to introduce some other method, or at least tell us something about some other method of finance to deal with this terrible and tragic problem.

There is only one thing to be said in favour of this proposal and it is that if this money were not raised the unemployed would not receive anything at all. This is the only proposition before us, but from my point of view it is a very disappointing proposition. I fully expected something better from the Minister. Let us remember that the winter is approaching and the present scales of benefit are not sufficient to keep a man or woman during the winter. When the House of Commons meets in October we shall be faced, probably, with a miserable and cruel winter. The Under Secretary of State for Scotland the other day said that 3½. a day would not keep a child. It certainly cannot do so in the winter. This Bill is a miserable Bill. It does nothing to feed the unemployed, nothing to clothe them, nothing to give them hope. It leaves them stranded. I do not want to discuss the question of "not normally" but I take the figures. No fewer than 68,000 last year or since the commencement of the Act, have been refused benefit on the ground of "not normally." And that is only the start and that is under a Labour Government. The engine is only starting to work. God knows what the figure will be if the right hon. Gentleman opposite gets it and goes ahead with it. A figure of 68,000 at the beginning, when the officials are only feeling their way, when the machine has only started to work. When they get the steam thoroughly going in the machine, God knows what the figure will be this winter.

It is an apalling thing, a ghastly thing, a cruel thing to contemplate and while the House will pass this Measure I hope that the Minister of Labour will devote her time in the Recess and her powers, to drafting a new Bill on this, the most urgent problem of all. It comes before schemes of work. It comes before almost every human consideration of which I now. If I may be allowed to say so, I do not know the feelings of the Members of the Government on this matter, but I do them the credit of believing that they must be fearfully worried about the torture which is suffered by the poor unemployed. How can they think about big world problems and deal with those problems if at the back of their minds is this torture and anxiety and worry about the unemployed? Let them free themselves at least of that worry and give themselves time to think out schemes. The only way is to summon Parliament by October of this year, to do the most urgent thing that is required to be done—to feed and to clothe the unemployed. I have lived among these people, I have represented them, I have come from them, and I think they are among the finest and best in men and women and children that the nation possesses.

Captain HAROLD BALFOUR

I find myself in a certain amount of agreement with the hon. Member for Gorbals (Mr. Buchanan) on one particular point and that is a thorough discontent with the exposition of the Parliamentary Secretary who opened this Debate. The hon. Gentleman spoke about the series of inspiring Debates which had taken place, but I should say that he has given us a very poor sort of account of a not very inspiring "rake's progress." There was no analysis of the causes which have arisen to make the introduction of this Bill necessary. There is not even a message of hope for the unemployed of this country. The hon. Gentleman either forgot to mention or could not think of any new message of hope, but he might have recollected the messages of hope given in the past by some of his colleagues in the Government. We can remember the Chancellor of the Exchequer writing in the "Daily Herald" on 3rd of June, 1929: In our first Session we shall deal with unemployment and bring relief and hope to the workers of this land. We shall not disappoint those who have shown belief in us. There has been nothing for the unemployed. There is nothing in the Resolution for the unemployed. There is nothing to bring them any hope, as far as the actions of the present Government are concerned. The Committee have a perfect right to some sort of analysis as to the causes of the introduction of this Resolution, and the analysis, I think, should take place with two objects in view, the first to obviate the frequent necessity of introducing such a Motion as this in the future, and the second to endeavour to see if the Unemployment Fund cannot be put on a sounder economic basis. The failure to cope with the problem of unemployment is very obvious from the figures which have been given to-day by the Parliamentary Secretary, and from what we read in the Ministry of Labour Gazette, for we can assure the hon. Gentleman that although he may be prejudging the issue by his knowledge of some Members of his own party, it is probably read with some intelligence and some real interest by the majority of Members on this side of the House. The hon. Gentleman must not judge by the standard to which he has been accustomed so long.

May I suggest that it would be a very good thing when the Minister replies if she could give some sort of analysis as to the causes which have made the introduction of this Resolution necessary, and, in giving that analysis, she should give some indication of the action which the Government intend to take as a result of that analysis to obviate in the future a repetition of these Resolutions. I have listened to every unemployment debate in this House, and gone away profoundly disappointed each time. I may have expected something from reading the pre-election literature and from hearing the post-election addresses, but I have been disappointed. The Government are entirely bankrupt of ideas. There have been no new ideas put forward which would make the introduction of a Resolution such as this unnecessary. There has been one put forward by the hon. Member for Smethwick (Sir O. Mosley), the late Chancellor of the Duchy of Lancaster. Whatever may be thought of it, he had a constructive idea. If you do not agree with them, you must grant to someone who has constructive ideas the credit for their imagination and conception. One disagrees entirely with most of the ideas of the hon. Member for Smethwick as regards his short-term programme, and it would be out of Order to enlarge on his long-term programme, but I say that if the Government had taken boldly some of those measures of Imperial development, the need for this Resolution would not be so great at the moment, and certainly might not be so great in the future.

The Government have not gone to the fundamental root cause which makes the introduction of this Resolution necessary, that is, the relation of the wage level of the sheltered trades to the wage level of the productive trades in this country. That, I really think, is probably the root problem of our industrial depression at the present time. It is a matter which we could look at, probably, above party politics. The Secretary of State for the Dominions has said that healthy national industry is the only cure for unemployment in this country, the only cure that will make a repetition of to-day's debate unnecessary. I think we are all agree on that, and I submit, in all seriousness, that the overhead charges, the costs of labour on national industry are too high for us to produce at competitive prices in the world markets. Doubtless hon. Members opposite are already muttering to themselves, and some hon. Member is getting ready for an onslaught upon a Tory Member for advocating a reduction in the standard of life. But perhaps before he prejudges, he will allow me to conclude these remarks by saying that we in this country are up against the tremendously grave problem of a democracy getting out of hand, because it is led by bad literature, by the daily press and I hold hon. Members opposite chiefly responsible for stirring up what is latent in the human nature of every one of us.

Mr. STEPHEN

Is the hon. and gallant Member in Order in making this veiled attack upon Lord Beaverbrook?

The DEPUTY-CHAIRMAN

I think the hon. and gallant Member knows that I have definitely ruled that we must not discuss the question of fiscal policy.

Captain BALFOUR

I had not mentioned the Noble Lord's name or his newspapers. I had more in mind the capitalist newspapers owned by hon. Members opposite. It is hon. Members opposite, who lead a great section of the community, and who, having stirred up in their followers all that is latent in us—malice, hatred, greed and envy—come down here, not as representatives—and this is one of the chief dangers of democracy at the present time—but as voicing the particular needs of their section, and not of the nation.

The DEPUTY-CHAIRMAN

The hon. and gallant Member is getting rather a long way from the Resolution.

Captain BALFOUR

I have no wish to go outside the licence you will allow this Debate. I will not pursue that, except to say that if we could get the relation of the wage level of the shelterd industries on a fairer basis as compared with the wage level of the productive industries, we should not have these Resolutions coming forward now and in the future. Any particular political party that went to the country now and advocated a reduction of the standard of life of any great section of the community would be committing political hari-kari, but if we could get the relation of the sheltered wages down as compared with the productive wages—[An HON. MEMBER: "What are they"?] The relation of the productive wages should be greater. The boilermaker on the Tyneside, the rivetter who has served his apprenticeship for many years in a skilled trade, draws less in wages than the scavenger of the streets, and I think everybody in this House will agree that it is necessary that our productive trades should be fostered, improved and made healthy, if we are not to have a repetition of this Resolution. There is no possibility of reducing this problem unless we can bring down the burden of the Unemployment Insurance Fund, and the burden of the high wages of the sheltered trades to a fairer proportion to those of the productive trades, which bear the whole weight of the commercial life of this country. If we could in this House face the problem of that relation, we shall be doing something towards solving the unemployment problem.

The state of the Insurance Fund must cause every citizen to think seriously, because we are abandoning all the principles of insurance. As a humble backbencher who has not been long in this House, but who has endeavoured to study this problem, I suggest that we should cut away the dead wood, and get -a proper actuarial basis of insurance for the Fund, and run parallel with that a fund which would be tantamount to a fund of national relief. The fund which we could create out of the dead wood which we cut away would be more malleable in its application than the laws and regulations allow in regard to the present Insurance Fund. I do not advocate subsidising wages, but, if we had this fund, there are instances where we could bring benefit to the commercial life of this country, not by subsidising employers or wages, but by using such a fund in an unconventional manner. There was a case recently of railway locomotives for India. The contract was lost, and £179,000 was lost in direct wages in the productive industries, and £184,000 was paid out in unemployed benefit. With a malleable fund separated from the sound actuarial Fund, and by a transfer from one Government to another, it would have been possible to allow the contract to stay in this country, and to have used the money in that fund for the purpose of getting men back to their right and proper employment rather than giving them unemployment benefit, which the majority of them do not want, but which they are forced to take. I put that forward only as a broad outline of a possible unconventional way of helping this problem.

Major GRAHAM POLE

There are other factors.

Captain BALFOUR

A new spirit and a new outlook are required; democracy is clutching at any straw at the present time. An hon. Member says that there are other factors. There are always more factors; what we want are not more factors, but a new determination to deal with this problem. As soon as we can get this new spirit and drive in our national industry, get back wage levels to a fair basis, get the Unemployment Fund on a sound actuarial basis and restore our national pride, we shall have no need for Motions such as this. I cannot think of a better creed with which to conclude, than a sentence in an election address which a friend of mine helped to draw up: I will pursue a policy which, whilst securing the power and honour of England, will introduce domestic reforms which the circumstances of the times render necessary. If we could stand by that principle, we should get men of good will of all parties, not to go to an all-party conference, but to join the Conservative party.

The MINISTER of LABOUR (Miss Bondfield)

I understand that there is a strongly expressed desire that we should have a wider discussion on the Second Reading of the Bill next Wednesday, so I will now deal with one or two points which have been raised in this discussion.—[Interruption.]—I do not think that it is an agreement, but a general understanding. I do not wish to stand in the way of the House in any way—

Sir A. STEEL-MAITLAND

So far as an understanding is concerned, the utmost that can be said is that it was thought that perhaps this discussion would not continue beyond 2 or 2.30 o'clock. That was the most I ever heard. A large number of Members on all sides want to speak. I only mention that now because, whether there was an understanding or not, as far as my Friends and I are concerned, that is the utmost that was said on the subject. I only say this so that no one should think that there has been a breach of any understanding.

Miss BONDFIELD

I at once accept the right hon. Gentleman's statement. I did not mean to imply that there was a firm understanding of any particular kind but there was a general desire that there should be a big debate on Wednesday; and, in view of that fact, it seemed to me that it might be possible to proceed to get this Money Resolution out of the way. With regard to one or two of the matters raised on the question of the causes of unemployment, I should like to give the Committee a small group of figures, which I think will interest them as showing the determining nature and the geographical position of this problem. First, I will take the division between the wholly unemployed and the temporarily stopped: The wholly unemployed number 1,182,333; and the temporarily stopped 658,196. Those who are neither wholly unemployed nor temporarily stopped, but who by nature of their work are intermittent, number 92,925. Those three groups obviously cut across the general division that has been made in the discussion to-day between those who are on transitional benefit and those who are on what is generally described as the Insurance Fund. It is not possible to have an exact figure week by week of the division between the two, but, broadly speaking, of this group, 300,000 may be regarded as on transitional benefit. I do not wish to be tied to the exact figure, because it is impossible to get exact statistics.

Dr. DAVIES

Can the right hon. Lady give the sexes?

Miss BONDFIELD

Not in that group. Taking the total of the three groups, we find that 65 per cent. of the persons unemployed are concentrated in the Midlands, the north-east, and the northwest—the areas of the coal mining, metal and textile industries. When we compare the percentage ratios of unemployment among insured persons, we find in London and the south-east division that the percentage is 7, as compared with 26.1 in the north-west division, and 27.6 in Wales. Therefore, the problem that we have to face is quite definitely linked up with the particular industries which have suffered from world causes. There are one or two other figures which I should like to give in regard to women. The total number of unemployed women aged 18 and over is about 458,000. About 46 per cent., or about 210,000 are married, and 54 per cent., or 248,000 are single. Of these numbers, a very large proportion, of course, are in the textile industries.

With regard to the length of time of unemployment, here again we have a very interesting analysis. About 8 per cent. of the males, or about 115,000, and 2 per cent. of the females, or about 10,000, have been continuously unemployed for 12 months or more. The overwhelming majority of those who were on the Fund have been unemployed for a comparatively short period, not exceeding three months. Then there is another category of those unemployed, not exceeding one month. I have not the figures before me, but I am continuing a close analysis week by week, and adding to the correctness of the figures by checking up, and I shall be in a position very shortly to give a much clearer picture, not merely numerically, but geographically and by industries, of the nature of the problem that we have to face. I have, of course, a complete analysis here of the trades showing the numbers and percentages in each group of trades, but it would weary the Committee to read the whole document. If I may be permitted to follow up one point which has not directly any connection with the Motion before the Committee—

Sir A. STEEL-MAITLAND

In order to understand the question, an analysis of the effects of relief works or public works, according as they are regarded, and the nature of the people who are employed on them, is equally necessary. I do not know whether the right hon. lady has carried her inquiries into that, but a knowledge of the result of such inquiries is as important as a knowledge of the statistics with regard to other employments.

Sir H. SAMUEL

Can the Minister give the figures relating to the three great groups of trades which are depressed, and which contribute the largest numbers of unemployed?

Miss BONDFIELD

The inquiry mentioned by the right hon. Member for Tamworth (Sir A. Steel-Maitland) is being pursued. With regard to the three great groups of trades, the number in the Midland division is 284,518—

Sir H. SAMUEL

The trades.

Miss BONDFIELD

In the metal trades the figure has gone up to 15.4 per cent.; cotton 42.2 per cent.; wool 24.7 per cent.; other textiles 23.4 per cent., covering the whole of the textiles. Then we come to coal 23.8 per cent.; and iron and steel 29.3 per cent. Coal and cotton together are 26 per cent. of the whole total. Another important misunderstanding has been made evident in the Debate to-day, and I would like to clear up that point once and for all. It is in regard to the "not normally in insurable employment" condition. Before the 1930 Act was passed, both groups of those in insurance and those on transitional benefit had to satisfy the condition of "genuinely seeking work." Those drawing transitional benefit had, in addition, to satisfy the condition that they were "normally in insurable employment," and had a reasonable amount of insurable employment in the preceding two years. Our Act of 1930 abolished the "genuinely seeking work" condition and also the condition with regard to a reasonable period of employment in the preceding two years, but it retained the condition, applying only to transitional benefit, that the claimant must be "normally in insurable employment."

1.0 p.m.

In regard to the numbers affected by that condition, I wish to take the strongest possible exception to the phrase used by the right hon. Gentleman the Member for Tamworth. I think it was utterly unjustifiable to use the phrase that it was government by subterfuge. The position is perfectly clear. If there was one thing I did more than another it was to remove the adjudication on claims right out of the control of the administration altogether and to place it in the hands of the judicial authorities set up under the Act. It is perfectly true, and everyone who has examined the decisions of the courts of referees and the umpire carefully will recognise it, that owing very largely to newspaper misrepresentation, owing very largely to misguided statements made, a large number of persons put in claims who neither under the old Act nor under the new would ever have been regarded as entitled to benefit. Those claims came with a rush at the exchanges and they have had to go through the machinery, first of all, of the courts of referees and then of the umpire, because Parliament itself took away from the insurance officers any right to refuse a claim. An insurance officer may grant a claim, but he may not refuse a claim; a claim is refused only by the judicial authority set up under the Act.

Therefore, the progress of winnowing out these claims, which under any circumstances could not be regarded as legitimate claims, has undoubtedly swollen the numbers of those turned down under the provision as to not being "normally in insurable employment" and not being expected to obtain work in insurable employment. The umpire's decisions show that he has taken into account, as I believe it was the intention of Parliament that he should, the varying circumstances surrounding particular cases, and it is quite true that, pending the umpire's case law being clearly understood by the Courts of Referees, there was a considerable amount of pressure and a considerable amount of work in connection with the hearing of cases both in regard to courts of referees and the umpire's court, and that there will not be a firm line of decision clearly demonstrable for another two or three months. But the work is being proceeded with at the greatest possible speed. The point I want to make is that the 300,000 to which this condition is applied have nothing whatever to do with the Motion before the House this afternoon; it does not apply to these persons who have 30 stamps within the last two years and who are entitled to benefit from what is known as the Insurance Fund proper. Transitional benefit is separated from that Fund and is borne by direct Treasury grant.

With regard to the point raised by the hon. Member for Gorbals (Mr. Buchanan) and others as to the intentions of the Government, may I remind the Committee of what I said when I introduced the Bill originally? I said that it would take us certainly 12 months to make the necessary investigation before we could see the line upon which it would be wise to move. Even before the Bill was passed I started to make the necessary investigation, and I have not ceased the investigation and the scrutiny required in order to provide the material upon which a Bill is to be based, must be based, before the date expires which is included in Vile Act itself. The transitional period applies only until April, 1931. I asked the House for that experimental year. I pointed out that having regard to the difficulty, a year is all too short for geting not only the experience of how the new terms are working, but also to see how far it is necessary to make any departure from what has been regarded as the basis of insurance up to this time. I am hopeful, I cannot say more than that, that when we have got this material it will be submitted for the consideration of those who are deeply and vitally interested in these questions, and that we shall have the benefit of consultation with all those, from any party in this House, who are concerned about seeing that justice is done to the unemployed and that the burden is equitably distributed in those quarters best able to bear it. I have to repeat to the House that however much borrowing may be wise in certain things, in a matter like this Fund I have always felt what a mostrous thing it was that we should have to borrow money upon which we have to pay interest in order that the Fund may be kept going.

Mr. MACQUISTEN

It is debited with interest; you do not pay.

Miss BONDFIELD

Oh yes, it is paid. Every March and every September I have to find more than £1,000,000.

Mr. ALPASS

It is sound finance on this side.

Miss BONDFIELD

I am not going to pretend that I have any desire to justify the position me are forced to take up. I do not like it. I wish we could have avoided it, but we are in such circumstances that I must, as custodian of the Fund, ensure that payments authorised by Parliament shall be paid between now and when the House meets again. The House has generously recognised that that is the position, and I am grateful to the House for the support it has given me. I shall have a great deal more to say next time, and now I only wish to say in conclusion that no side of this problem is being left out of account. It is a very intricate one and I am not wasting any time in preparing such documents as will be required in order that we may come to a right decision as to the future of the Fund, as to its financial basis and as to the conditions under which it shall be administered. I hope, therefore, the Committee will permit me to have the Resolution.

Mr. OLIVER STANLEY

The right hon. Lady has pleaded in her usual gentle fashion for an immediate decision, but I would point out that in the Debate, which has lasted for 2¼ hours, there have been only two speakers from this side, and that a very large proportion of the time has been occupied either by hon. Members opposite or hon. Members below the gangway. I think, therefore, that she cannot feel aggrieved if those of us who feel rather strongly on this subject should wish to address the Committee, at least briefly. I join with the right hon. Lady and everybody else who has spoken, in deploring the occasion which has given rise to this Resolution, but I differ from certain hon. Members over the method which has been adopted to meet the particular difficulty to-day. Twice now in this financial year the right hon. Lady has had to come to the Committee to ask for powers to borrow two sums of £10,000,000 each, and those two sums will at the present rate, be exhausted before the close of the financial year. To put before the country the possibilty of the whole £20,000,000 having to be found in next year's Budget is to present a financial prospect which cannot fail to damage the confidence of traders.

I could not follow the argument of the hon. Member for Gorbals (Mr. Buchanan), who seemed to think that if the £20,000,000 is met out of the Budget of the year it must fall exclusively on the richer classes, while the interest upon that sum, equally a charge on the Exchequer, equally to be met in the financial year, must inevitably fall only upon the poor. It is for the Chancellor of the Exchequer to decide how either of those two charges are to be allocated, and all we are discussing to-day is whether we are going to call upon the country in a time of great emergency and great strain to find the whole of the £20,000,000 or whether we are going to spread over repayment to other years in the hope of an amelioration of our position.

Mr. MAXTON

In reference to what has been said regarding the attitude of the hon. Member for Gorbals (Mr. Buchanan), I would point out that the money has got to be found by the country—there is no eluding that. If the unemployed are to be kept it has to be found, and whether we do it by borrowing or by taxation, it still comes out of the total national income.

Mr. STANLEY

I quite agree. The only difference is whether we are to find the whole of the sum in this year or to create a credit and spread it over the next two or three years.

Mr. MAXTON

If the hon. Member will allow me to discuss the matter with him for one moment, I would like to say that, whether repayment is spread over a number of years or not, the money has to be found in the particular year under discussion. My hon. Friend the Member for Gorbals, said: "Find it this year, and do not talk about paying it back at all." What the hon. Member says is, "Borrow it this year and pay it back over a series of years." It is going to be spent in the year under discussion, whether you borrow the £10,000,000 or raise it by taxation.

Mr. STANLEY

If you are borrowing now and paying back over a period of years you are equally drawing the money from the taxpayers, but under this scheme you draw £20,000,000 immediately from those who, presumably because they are ready to invest in Treasury bills, have the money at their disposal, while if you obtain the £20,000,000 by taxation immediately, you have to take it from particular classes in the country. To borrow is extraordinarily bad finance, because you are merely postpoing an operation which has to take place, but in times of such emergency it is a wise thing to do, and I am afraid it says a great deal for the laxity of my own financial views that the first and only time I shall agree with the Chancellor of the Exchequer is when he makes his first slip from the path of financial rectitude which he has pursued.

Let us face up to the fact that this is not a loan at all. A year ago in similar circumstances, the Chancellor of the Exchequer explained to us that there was no possible chance of this loan ever being paid back, that the Fund to which we are lending it is bankrupt, and we are to-day simply meeting current annual charges by borrowing, we are, in fact, raiding the Sinking Fund. I think that at the moment it is far the best way of doing it, but do not let us have any humbug about it. In a few days' time the Chancellor of the Exchequer will come to the House and move a Clause with regard to the obligations of Chancellors and the Sinking Fund. When he first mooted it, it was nothing more than a self-righteous gesture, but if he moves it now it is sheer hypocrisy, because within a few weeks of bringing forward that Clause he shows how a really skilful Chancellor of the Exchequer can evade it perfectly easily to the tune of £20,000,000 a year. The Minister of Labour and the Parliamentary Secretary have given the House a great many figures, the object of which seems to have been to make us think that things are not quite so bad as they seem, and the right hon. Lady told us that there were only two per cent. of the total unemployed men and women who had not done any work for a year. Statistics have been given for the past four years, and we have been told that the situation is not so bad as it has been painted, and that it was infinitely worse four years ago. The right hon. Lady cannot deny that the situation which, last year, was very bad, is enormously worse to-day.

Take the financial aspect of this problem. At the present time, we find that the country is spending approximately £100,000,000 a year for the maintenance of the Unemployment Insurance Fund, and of that amount £70,000,000 comes from the National Exchequer. Not only have we to find another £20,000,000 to carry on the Fund until the end of the year, but we have to pay in this financial year in respect of this Fund another £20,000,000 which was not budgeted for by the Chancellor of the Exchequer. That means that the taxpayer will have to bear, sooner or later, a burden of £20,000,000 which was not put before the House at the beginning of the financial year. It is obvious that the situation is so bad that this kind of thing cannot go on.

The primary remedy for this state of things does not lie with the Unemployment Insurance Fund. Various criticisms have been made and a reorganisation has been promised, but the right hon. Lady knows quite well that no amount of altering the regulations and conditions is really going to improve the situation which we are up against at the present moment. The true remedy can only be found by a policy which will enable the 2,000,000 who are unemployed to find employment. I know there are plenty of policies floating about. On this side of the House we have a policy which we are not allowed to discuss in detail, but it is a policy which would secure for the workers certain markets, including our home markets, which to-day are largely denied to us.

The hon. Baronet the Member for Smethwick (Sir O. Mosley) has a policy with a similar aim, although it is to be worked by different machinery, but the Government have turned that policy down as well as the policy put forward by the Conservative party. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) has also a policy; in fact, he always has a policy, although sometimes he has not a party. There is also what is known as the dumping policy—

The DEPUTY-CHAIRMAN

I think the hon. and gallant Member is going rather too far.

Mr. STANLEY

I have no intention of going into the merits of those policies, but I thought that we were entitled to indicate the policies put forward.

The DEPUTY-CHAIRMAN

The hon. and gallant Member must confine his remarks to the Resolution before the Chair.

Mr. STANLEY

I will content myself by saying that the right hon. Gentleman has a policy so catholic in its character that it appears to have room for every one, but not for the Government. The Chancellor of the Exchequer has turned a deaf ear to all these suggestions. We do not object to hon. Members opposite being deaf, but we do object to them being dumb. Even the volcanoes on the other side have no lava, and there is no sign of life in them at all. The Government have failed to adopt a bold policy and are continuing their policy on habitual lines. Boldness has entirely died away on the front Treasury Bench, and the difficulties of Parliamentary procedure and party Government have made every occupant of the Front Bench hope that the trouble will solve itself upon traditional lines.

Something has to be done to meet the problem, and I think that hon. Members would rather be listening to right hon. Gentlemen opposite announcing a policy with which we might disagree, but which might promise some relief to the country rather than continue as we are at present with the Secretary of State for Dominion Affairs telling the world that every cloud has its silver lining, and the Prime Minister giving us that celebrated impersonation of "a good man struggling with adversity." The Chancellor of the Exchequer has been trying to comfort hon. Members opposite by telling them that there was once an economist who said that in six months' time things would be better. Has there ever been a time when some economist of repute was not ready to say that things are going to get better or worse. The country is asking for some immediate relief. Democracy is on its trial and is waiting for somebody to do something. People are beginning to be doubtful about the efficacy of democracy. They have been told so many things that they cannot make up their minds, and they have been informed that, if they will only choose the same things, they will sure to be right. Now the people are looking forward for someone to lead them and tell them what they believe should be done to remedy this state of things. That is a lesson to be learned not only by the Government, but by all those interested in this problem.

Mr. MAXTON

The hon. and gallant Member says that democracy is waiting for somebody to do something. Has he seen that somebody, and that something?

Mr. STANLEY

We see something, and—I exclude, of course, right hon. Gentlemen opposite—we see somebody. Unfortunately, at the moment, we are inclined to disagree as to the somebody, and not altogether to agree as to the something. It is quite true that the primary difficulty lies outside the control of the right hon. Lady; it is a burden that her colleagues must share with her. But beyond that there does lie a certain amount of cause for this difficulty in the constitution and administration of the Fund itself. The right hon. Lady has, quite rightly, asked for time. She tells us that she does intend to bring what I hope will be a radical scheme of alteration before the House in time, but I do ask her not to build her scheme on the exceptional difficulties and trials of the moment. We do hope that, with improved world conditions and under a new Government the emergency will lose at least some of its present severity, and we do not want a scheme to be brought forward only to deal with an emergency which exists to-day and which in a year or two may have been diminished.

Far better than to have panic legislation on a subject of this kind is it to carry on with temporary measures until stabilised conditions make it possible to bring in a real solution. That, at the best, can only contribute very little to the difficulty in which we are. It requires a much bolder policy, and, unless we get that—and, as long as right hon. Gentlemen opposite are there, I very much doubt if we ever shall—we shall see nothing but a dreary vista of similar resolutions to this being brought down to this Committee at shorter and shorter intervals and for larger and larger amounts, with no alternative left to the House but to adjourn, as it is going to adjourn now in a few days, its only contribution to the solution of the unemployment problem having been the granting of authority to the right hon. Lady to go on borrowing a sum which we hope is sufficient to enable her to keep the Fund running until we come back again.

Mr. STRACHEY

I shall not keep the Committee very long, but I want to offer a few remarks which will be more appropriate to this Money Resolution, as they will deal with the financial aspect of the matter, than to the Second Reading of the Bill. I do not think that any Member, on this side of the Committee at any rate, grudges for one moment the £10,000,000 which we are being asked to vote on this occasion—

Mr. MACQUISTEN

It is not their money.

Mr. STRACHEY

The right hon. Gentleman the Member for Tamworth (Sir A. Steel-Maitland) described the conditions which resulted from the Unemployment Insurance Bill of last autumn as ghastly. I think that that shows a curious point of view. We on these benches would be more inclined to view the conditions in this country as ghastly if something of that nature had not been done. Ghastly or not as it may be, there is no doubt that, if we had not this system of unemployment insurance, if we had not improved it, and, as I think, if we do not extend it, the conditions would be infinitely more ghastly than they are to-day. With the unemployment figure at the level at which it is to-day, with the economic life of this country in the parlous condition in which it is to-day, it is not too much to say that the whole social structure of this country is kept together by the existence of this Unemployment Insurance Fund, and that the most important social work we could possibly do, apart altogether from any question of common humanity, in actually keeping our economic life turning, is to fortify this Fund.

Therefore, if any doubts or objections are felt on this side of the Committee in regard to the present Resolution, it will not be that we object to the sum of money which is being voted, but rather that we feel that there are very grave objections and very grave difficulties about the way in which it is being provided, about the method of borrowing which is being resorted to. If we have these objections, it is because we have been taught to have them by the present Chancellor of the Exchequer. If we wished to have a master to teach us a lesson on the evils of State borrowing at the present moment, the Chancellor of the Exchequer has certainly given us many very clear lessons. We have been told repeatedly that the whole policy of the Government during their year of office has been to set their face most sternly against borrowing for any type of public works, for providing work of any kind whatever for the unemployed; and, therefore, it must come with somewhat of a shock to Members on this side of the Committee when, a second time, we find the Government coming to the House of Commons and asking for powers to borrow, not for providing useful work of any kind, but simply for direct maintenance. If it is wrong to borrow for works which, although there may be some question as to whether they are useful or not, do at any rate create assets to some extent—if that is wrong, if the famous Treasury view tells us that that is of no use for providing employment—how much more is it wrong to borrow when there is no question of creating any asset whatever? It really looks as if the objection of the Chancellor of the Exchequer had turned out to be, not against borrowing at all, but against work schemes. Apparently he has no objection to borrowing if no work is going to be done with the money that is provided.

We have really reached a most extraordinary position. Of course we know that the right hon. Gentleman tells us at intervals that he has never turned down any work schemes which have been presented to him on the ground that he was unwilling to borrow the money. However that may be, he has certainly seen to it that the conditions governing grants, and the whole relations with the local authorities, shall be such that a very small number of work schemes are presented to him, and, therefore, his claim that he has never turned down any of these schemes on financial grounds has rather less substance in it than might appear at first sight. We have to remember, at the same time that he has always been judge and jury in his own court as to what were reasonable schemes and what were unreasonable. He seems to have a rooted objection to what I think the late Lord Privy Seal called artificial work. He regards himself as the doughty champion standing in front of the public purse and preventing it from being raided by spendthrifts who actually want to provide houses, roads and public developments of all sorts; but now we find that, after all, he has not been such a successful defender of this public purse. He has refused to have these work schemes, but now he has discovered that the men who would have been employed on them have had to be maintained after all, and he has had to come to us and borrow in order to maintain these men, simply because he would not borrow to provide them with useful work.

Criticisms have been made from the benches behind me of the conception of work schemes, and certainly there are obvious limits to their usefulness. The hon. Member for Gorbals (Mr. Buchanan) told us that he had never found a man who was in need of a road; but he must have found men who at any rate were in need of houses, and I think that a considerable number of the men who will have to be provided with unemployment relief out of the money which we are asked to vote to-day might have been provided with useful work—urgently necessary work—had a far greater and far bolder housing policy been developed; and it would have been far better that we should have voted for the borrowing of money for a great housing proposal on national lines than that we should vote for borrowing money merely for maintenance purposes.

What is the distinction which the Government draw between economic work and artificial work? They seem to regard work in one of the existing industries—steel, cotton, mining or what not—as legitimate work which is all right which they tell us is a real contribution to the solving of the unemployment problem; but any work on housing or on national development of any sort which they themselves create, either directly or through the local authorities, they regard as artificial work. The late Lord Privy Seal was never tired of sneering at proposals of that kind for mitigating the unemployment problem. Yet what, in fact, is the difference between these two kinds of work?—The only difference I can see is that the work in our normal industries is done with the object of making a profit and the other kind, the provision of houses and public works of all sorts, is done, not for a profit but for use, and it is rather a strange irony of fate that the first Socialist Chancellor of the Exchequer should be the man to discriminate so strongly in favour of work for profit and against work for use. But these are probably the little ironies that Governments make inevitable.

The other point I wish to raise is the extraordinary position with which the Committee is faced when we are being asked to borrow £10,000,000 for the Unemployment Insurance Fund only a few days after we have been discussing those Clauses in the Finance Bill in which the Chancellor of the Exchequer had provided an extra £5,000,000 for the Sinking Fund for the repayment of debt. We are reduced to this astonishing position, that with one hand we are borrowing £10,000,000 and with the other we are paying back £5,000,000. The gesture on the part of the Chancellor of the Exchequer was no doubt a most noble one He was able to stand before the House as far more financially orthodox than his Conservative predecessor. Where his predecessor—

The CHAIRMAN (Mr. Robert Young)

We are not dealing with the Chancellor of the Exchequer at the moment. We are dealing with unemployment in relation to the Ministry of Labour.

Major ELLIOT

Surely we are discussing the financial Resolution and nothing else.

The CHAIRMAN

Certainly, but we are not discussing the £5,000,000 which the Chancellor of the Exchequer is providing for the Sinking Fund.

Major ELLIOT

We are discussing the £10,000,000 which we are borrowing. Surely, if we are borrowing £10,000,000 at the same time that we are paying back £5,000,000 we are bound to take into consideration the whole financial policy.

The CHAIRMAN

We are entitled to say it and to pass on and no more.

Mr. STRACHEY

I think if you, Sir, had been present you would have seen that a great many other speakers have dealt with the matter, and it is really essential, during the discussion of a Resolution which asks us to borrow money, to discuss whether we ought to borrow it or not or whether it would have been possible by other financial arrangements to obviate borrowing.

The CHAIRMAN

The hon. Member may touch upon it, but that is all he is entitled to do. Under this Resolution we are not concerned with criticising the Chancellor of the Exchequer.

Major ELLIOT

Are we not entitled to discuss the policy of borrowing?

The CHAIRMAN

We are not entitled to bring in the Finance Bill on this money Resolution.

Major ELLIOT

Is it not a question of borrowing, and are we not entitled to discuss the borrowing policy?

The CHAIRMAN

I am dealing with the hon. Member who raised the question of criticising the Chancellor in relation to the repayment of £5,000,000. That does not arise on this money Resolution.

Mr. STRACHEY

I was not criticising the Chancellor of the Exchequer. I was criticising his policy.

The CHAIRMAN

It is the policy of the Minister of Labour that we are dealing with now.

Mr. STRACHEY

We are dealing with the whole financial policy of the Government. You cannot separate Cabinet responsibility in this way. It is perfectly impossible to do it.

The CHAIRMAN

We are dealing with the £10,000,000 of the Minister of Labour, which is chargeable upon the Exchequer. When the hon. Member departed from that and commenced to criticise, as he was doing, the method of the Chancellor of the Exchequer, or his policy, in relation to the £5,000,000 to which he refers, that was not in order.

Major ELLIOT

We are not discussing the policy of borrowing which is a charge on the Exchequer at all. This has nothing whatever to do with the charge on the Exchequer.

The CHAIRMAN

That has nothing to do with the fact that you cannot bring in the Finance Bill and that you cannot discuss the Finance Bill on this money Resolution.

Major ELLIOT

We are making no attempt to bring in the Finance Bill.

The CHAIRMAN

I am not referring to the hon. and gallant Gentleman and there is no need to say "we." I am referring to the hon. Member who was speaking.

Major ELLIOT

With the utmost respect, when I say "we" I am referring to the House of Commons and to the Committee which is now discussing this Resolution.

The CHAIRMAN

And I rule that it is not competent under this money Resolution to deal with the Finance Bill or anything done under the Finance Bill.

Mr. STRACHEY

My intention was to deal, not with the Finance Bill as such, but with the whole question of national borrowing and, as this Money Resolution is expressly for the purpose of national borrowing, it seems to me almost impossible to deal with anything else under it. What I was about to suggest is that, even at this somewhat late stage in the development of the financial policy of the Government, it would be infinitely better if they recognised the complete illogicality of the position which they have come to now, a position which is characterised as borrowing £10,000,000 with one hand and paying back £5,000,000 with the other and took, as any commercial firm would do, those two transactions and put them together and allowed them to cancel out. Instead of providing this money by fresh borrowing, we could abandon that gesture—for it is nothing more than a gesture—which the Chancellor of the Exchequer is making in his Budget of paying back the extra £5,00,000 over and above—

The CHAIRMAN

The hon. Member is not entitled on this Resolution to bring in a discussion of the Budget or to deal with the Budget at this stage.

Mr. STRACHEY

Are we really to understand that we are asked to grant a Vote giving power for public borrowing and that we are not at the same time discuss the question of how much of previous borrowing should be paid back in the form of provision for the Sinking Fund? Surely, it is quite impossible to discuss the advisability of the Government borrowing without bringing in the question of previous borrowing.

The CHAIRMAN

The hon. Member is criticising the Budget. When he pointed out that the Chancellor had done something regarding the repayment of Debt, that is all that it was necessary for him to say.

Mr. WALLHEAD

Surely it is Governmental policy and it is permissible to discuss it. Is it not true that the Ministry of Labour is only dependent on the Treasury for the money it wishes to raise?

The CHAIRMAN

The Minister of Labour has to come here to increase borrowing powers—that is the question that is before the Committee—for a certain specific purpose. It is not in order to bring in the Budget and to make a criticism upon it.

Sir OSWALD MOSLEY

May I point out that my hon. Friend is not dealing with the Budget as a whole. We are now asking for fresh powers to add to the Debt of the country. Is it not relevant to that situation to consider what the Debt of the country already is and what provisions are made for dealing with the Debt? Is not this a matter which strictly affects the Debt of the country and increases it?

The CHAIRMAN

It is quite in order, as I have said, to refer to the Chancellor of the Exchequer as having done a certain thing and leave it there. The hon. Member is proceeding further than that.

Mr. STRACHEY

We are, therefore, I gather, in order in stating that the Chancellor of the Exchequer has done a certain thing, but not in suggesting any alternative to him. However, I will pass from that point because I think, in the form of the discussion with the Chairman, the point at issue has been brought out very clearly indeed. I am estopped from repeating the suggestion that these two financial arrangements should be brought together and, as that cannot be done, we shall have no alternative, of course, but to submit to the Government in allowing the Unemployment Insurance Fund to borrow another £10,000,000. But, in doing so, I think someone on this side of the Committee must very strongly press the Government to make some reconsideration of their whole attitude to proposals of any character for the provision of work. Otherwise, we see in this Money Resolution only the prelude, the second example of a long series of deeply humiliating occasions whisk this Government will bring upon themselves. They are refusing steadfastly any really large-scale proposals for the provision of work. They are refusing them specifically for the Treasury and financial reason that they are opposed to the borrowing which would undoubtedly be necessary to finance any large scheme of work. Having refused borrowing for this constructive purpose, they will find that a few weeks later they are forced to come down to the House and ask for borrowings merely for the maintenance of the men for whom they have neglected to provide employment. That is the position upon which we feel very strongly on these benches.

Mr. SEXTON

Which benches?

Mr. STRACHEY

On these benches. We are very anxious indeed, and I trust that my hon. Friend feels anxious about it, too. I should imagine that he feels anxious about it.

Mr. SEXTON

I feel anxious about you.

Mr. STRACHEY

I should imagine that my hon. Friend feels anxiety about the position of the unemployed and the position of this country during the coming winter. I can assure him that, not only on these benches, but, I am sure, upon all benches in the House of Commons, the deepest anxiety is felt on this subject. We ask the Government to realise that the very fact that they have had to come to the House on this occasion and ask for money for the maintenance of the unemployed proves that there was no true economy in their previous policy of refusing to finance large schemes for the provision of work for the unemployed. We have, at any rate, come to some approximation of the old Labour party ideal of work or maintenance. Once we established the principle in this country that when a man is not employed he is to be maintained, there is no economy in refusing to provide work for him, because if you do not provide work you will have to provide the money with which to maintain him. That appears to be a far less desirable way. The lesson of these repeated occasions in which not only this Government but other Governments have to come to the House and ask for further financial provisions for unemployment insurance must be that, once the principle of maintenance has been established in this country, the only true economy is to have a financial and a general economic policy bold enough to provide work rather than maintenance for the unemployed.

Major GLYN

I am sure that the Committee have listened with great interest to the speech of the hon. Member for Aston (Mr. Strachey), and I am sure that some of us on this side of the Committee feel that it is a matter of great disappointment that the difficulties with which we were confronted during the last Parliament have not been more successfully negotiated by His Majesty's present Government. It is a most depressing experience for Members to come down to the House of Commons month after month and go through this farce, for it is a farce, of debating the provision of these large sums of money which are not going to help unemployment. There is no cure for unemployment but employment. The Government are merely passing on the burden to future generations.

Throughout this Debate there has not been a word said about the moral effect of the present position and the appalling human deterioration which is going on in the country. It is our business to vote this money every penny of which is of much less importance than the loss of the physical well-being of the great mass of the people who, very largely through no fault of their own, are unemployed. I hoped that when the present Government took office, in view of the hold which they have over the trade unions, they would be able to do something which a Government formed from our party could not do nearly so easily. I do not know whether hon. Members opposite will agree with me, but it has always seemed to me that one of the great difficulties which we have to solve is how long a man is entitled to say that he follows this, that or the other occupation, and that he is a skilled man? After how many months or years is he really entitled to say that he is a skilled man?

I look upon the problem as being devisable into two parts. You have to find employment for your unskilled labourer or the ordinary workman who has always belonged to the pool from which workers are drawn and in which is left a residuum which is almost unemployable. They are the most tragic of all our people who are unemployed. It is so easy to confuse the skilled men with the unskilled men. I understand that the economic committee inquiring into the question have come to certain conclusions, and we have heard from the Treasury Bench that a very small proportion of the men and women appearing on the register have, in fact, been out of work for a very long time. But if anyone has had anything to do with dock labour, as I have indirectly, he will realise that one of the greatest tragedies in modern industrial life is to see the rush of men to the dock gates when a notice is put up saying how many men can be employed. What contribution have the Government made towards the solution of that problem, which is one of the most complicated problems which requires to be solved?

I will mention another matter which the Government might well consider. In 1926, we passed the Electricity Act, which is a measure of national importance. There is now an electricity board, and there are electricity commissioners and money has been provided for organisa- tion. We were told that we were going to see cheaper production by means of giving facilities for electricity supply as well as the provision of work for the British worker by the year 1940. Here we are in 1930, and I ask, what provision have the Government made to bring forward the date from 1940 to 1935 by employing people who are unemployed? The great mass of the work connected with the supply of electrical energy is in transmission. In fact 75 per cent. of the price you have to pay for power goes in transmission and not in actual production.

Mr. MACQUISTEN

Much more.

Major GLYN

Seventy-five per cent. is, I think, quite a safe figure to indicate that there is plenty of work to be done by unskilled men in the provision of transmission lines. You can get access to the land in the winter and put up your transmission poles and so on. These are matters which flow through the minds of hon. Members when we meet on these occasions and discuss these subjects. I feel that the outlook is indeed bad and black if the Government, who have so much control over the trade unions, can contribute absolutely nothing to that which we have already tried to do. I can see very little difference between what the present Government are doing and what we did, and that was little enough, heaven knows. None of us on this side, I think, was satisfied with what had been done. I believe that the country feels that we have been talking and talking since 1920 and have accomplished very little. It is like new wine being poured into the old bottles of party. I wonder how long we shall remain inside the old bottles before they burst.

We shall have to face these things in the future without bothering about the labels we bear. We must not be afraid of the label of party, but we must face the difficulty and deal with it. The question is so appallingly serious that something must be done. While it is the business of the Opposition to criticise—and we are entitled to criticise the Government for not bringing forward practical schemes—and although we did not have the assistance from the Opposition that we should have liked, we shall be glad to give our support if the Government will bring forward something really useful. We all feel greatly disappointed that the hon. Gentleman the Parliamentary Secretary, who at the War Office did a great deal for industrial training, has not been able to use his influence with the Government to set up more training establishments in order to get hold of young men and women and to give them the necessary training to enable them to fit into occupations. I am told that there is room for 7,000 cooks in Bournemouth alone. That may or may not be true, but I can well believe it. There are people being imported from foreign countries to do domestic service. I am told, and I know it to be a fact, that it is extremely difficult nowadays to induce young men to take on work which they might have been inclined to do if they had a greater spirit of adventure. Hon. Members will recollect the speech which was made in this House by the right hon. Gentleman who used to represent one of the Bristol Divisions, Captain Guest, when he put forward a plan that there should be mobilised a sort of active service division, which would recruit young men between the ages of 17 and 25, guarantee them clothing, food and pay, and utilise them as a sort of mobilised division to go overseas to British Colonies and Protectorates, there to do work, to see a bit of the world, and return to this country certainly healthier, happier, and, one would hope, richer people. That was a concrete plan.

It is appalling to think that here we are in this House, and we are not able to get a move on against the miserable inertia that we all feel. When we feel it, God knows how the men in the big cities feel it. To whom can they look if we cannot make a contribution towards a solution of the difficulty I Whose business is it to make a contribution. It is surely the business of the Government. They are the only people who can make a contribution, and so far they have not done it. Anyone who is devoid of ideas can borrow money. Borrowing money is not a solution of the problem. A solution of the problem is to bring boldly forward a scheme that will give us lower costs of production throughout the country. If we can hasten forward the day when cheap power will be available that will enable British manufacturers and British workers to compete with the foreigners without reducing wages, it will be a happy day for this country. Lower costs of production can be brought about in two ways. We ought to look first at the means of reducing the cost of power. At the present time in the United States 75 per cent. of the industry are assisted by electrical energy, compared with 73 per cent. in Germany and less than 50 per cent. in this country.

Surely, if ever there was a, time to utilise labour that is going to waste, not because it is useless but because it cannot get the opportunity to work, now is the moment to do it and to tackle this great question of cheapening the cost of power. We have the whole organisation, the whole of the plans approved, and the schemes agreed for England and Wales. What we want is for the Government to come boldly forward and instead of writing 1940 as the day when the British worker will have five-horse power at his elbow instead of one-horse power to make it 1933. Let them decide upon a plan and go boldly forward with it, utilising the unemployed men, and then we shall not have to come down so often to this House to appeal to hon. Members to vote money instead of voting ideas, which are far more important.

Mr. LONGDEN

I am in agreement with one hon. Member when he said that borrowing money in order to pay unemployment benefit is one thing, but borrowing money for constructive work is another, but I am not in agreement with him in another phase of his speech. He went on to say that in borrowing money to pay unemployment benefit we are not creating assets. The right hon. Member opposite was right when he said that there was a certain amount of demoralisation going on, and it is on that point that I disagree with the hon. Member on this side of the House. Certainly, if we are to pay benefits we are preventing the further demoralisation of the people, and we are creating that lifeblood which is essential to a productive community. Whilst we are facing this problem in the wrong way, we have to admit that this Financial Resolution is absolutely necessary. It is not necessary because, as the hon. and gallant Member for Thanet (Captain Balfour) said, our difficulties are the result of democracy getting out of hand. If democracy is not what it ought to be, it is because private enterprise has so corrupted it as to leave it incapable of seeing as clearly as it might. The hon. and gallant Member went on to say that what we wanted was a highly industrialised state of things, but he did not say that the state of things in which we find ourselves now, and for which we need this money, has been brought about because wealth in plenty, producible in plenty at any time, is not fairly distributed among the people who produce the wealth. They cannot buy what they make and they are on the streets, unemployed.

2.0 p.m.

It is clear that employers do not take workers into their shops until the workers are profitable; until they can produce far more wealth than they take out of the industry at any time. The situation as we see it now is ghastly, to use the words of the right hon. Member for Tamworth (Sir A. Steel-Maitland). It is ghastly for the reasons that I have stated, and when we vote money in this way we have a right to insist that the administration shall be fair between our people. I have many cases—it will be out of order to discuss them—from a poverty-stricken division in Birmingham which prove up to the hilt that local officials have great power in interpreting laws, past and present. The last Act passed by the Labour Government is being ignored in many cases, and we are having interpretations which discriminate against this or that man, woman, or youth, in accordance with the make-up of a given court of referees. The Parliamentary Secretary to the Ministry of Labour knows very well—he has said so time after time—that courts of referees are not packed as they ought to be.

Mr. LAWSON

I said that they are not attended as they ought to be.

Mr. LONGDEN

That was what I was saying.

Mr. WOMERSLEY

If your representatives did their job properly, you would not have to come here to complain.

Mr. LONGDEN

I was pointing out, in spite of what the hon. Member for Grimsby (Mr. Womersley) has said, that the courts of referees are badly attended. There are cases where one man can constitute a court of referees and himself, without any knowledge of working-class conditions, deny benefit to a man, woman or youth. Being a statutory body that man or woman must, accept the decision. The right hon. Member for Tamworth said that the longer people are out of work the longer they will remain out of work. I have cases where men and women and youths have been denied work because they have been out of work for some years. There seems to be no effort on the part of local managers or other officials to see that work is more equally distributed amongst those people who are extremely eager to find it. Local officials have a power of discriminating between one person and another, not only in the granting of relief but also in placing people in work. This is all I have to say, but I should like some information on these points before I vote for money in this way. We still demand work or maintenance; and there is neither work nor maintenance for masses of our people in our large towns.

Viscount LYMINGTON

Once again, after the lapse of a few months, we are asked to vote a sum of money for what, however necessary it may be, is admittedly largely unproductive expenditure. Looking at this question from the point of view of the system, one cannot help feeling that it is getting totally confused. One of the saddest things about to-day's debate is the White Paper explaining the Financial Resolution. At the foot of it, we see the statement that if the unemployment figures stand at a million and a half, the Fund will last until March, 1932, but if they stand at a figure slightly lower than to-day the Fund will last until March of next year. The last time we discussed a Resolution of this kind the Minister of Labour put the figure at which the Fund would be actuarily sound at round about 1,000,000.

Mr. LAWSON

One million and a quarter.

Viscount LYMINGTON

The case as it stands to-day is that of the money which we are voting for the purposes of unemployment insurance, one-third is dole and two-thirds unemployment pay. That is a point which has not been clearly brought out up to the moment, and I think we should realise that this confusion of Poor Law and unemployment insurance makes the problem all the more difficult to deal with, and it will eventually make the life of the nation, so far as unemployment insurance is concerned, almost impossible. The dole—I am not talking about unemployment insurance—comes very closely to the analogy of a lie. I do not mean that offensively, but if you look at it from this point of view that is what it really is. You are calling it unemployment insurance, but one-third is not unemployment insurance at all, it is national poor relief. It is like a lie in this, that it is a very present help in trouble; it is like a lie because it is inclined to blind the recipient as to the truth; and it is like a lie because one Vote of this kind leads to another. I am not going to quote from or taunt hon. Members opposite with previous speeches. I am not even going to talk about "our oldest allies," who, as the hon. Member for Leith (Mr. E. Brown) says, are always the butt in this House. I want to deal with the matter in the simplest way and to give one or two instances which have occurred within my own experience.

On my own lands I worked out a water supply scheme under the plans of the Lord Privy Seal. It was an admirable scheme in many respects, but the red tape about the whole thing was almost disheartening. Let me give one instance. A letter arrived at my office wanting to know why there was a halfpenny difference on the unemployment insurance return of one particular workman. The Government's share of that halfpenny was one-third. They spent 1½d. on the letter they wrote to me, and I had to spend 1½d. on the letter in reply; and the whole reason for this was because you cannot write one halfpenny on a cheque. Let me give one other instance, which might be called the Yellow Book speeding up of things run wild. Very rightly, the Government have been doing their best to increase the telephone services, but they do not set a very good example in national economy, which is urgently needed in these days of unemployment. I had occasion to change my manager's house and place it at a quarter of a mile from my own house. There had to be an extension from his house to mine. Between this house and mine ran the main telephone line and four poles only were necessary to reach the main line of the telephone service. When we asked for the transfer to be made we pointed out that this was the simplest and cheapest way of doing it both from our point of view and from the point of view of the telephone service. However, they preferred to go 2½ miles away to the exchange and employ four men for five weeks putting up poles which were totally unnecessary, and more expensive for us and for them.

The CHAIRMAN

Does not this come under the Post Office Vote? This is a matter for the Postmaster-General, not for the Minister of Labour.

Mr. PYBUS

Will the hon. Member tell us just exactly what this has to do with the Vote? His domestic troubles between himself and his manager must be a very serious concern to him, but what has it to do with the question before the Committee? Will he really tell us whether anything he has said has anything to do with the Motion now before the Committee?

Viscount LYMINGTON

Certainly. "The Liberal Yellow Book run wild," was what I said. The Yellow Book advocates an enormous extension of roads, speeding up of the telephone service and getting as many people as possible at work immediately. But one does not always see that it will be productive expenditure. The connection which this has with the Resolution under discussion is the fact that, there must be real economy, and that we cannot have waste and red tape if we are to deal with the national problem as it is to-day. I have not taken up the time of the Committee with a personal experience in order to waste time, but because it was something that I could prove. Let me come to a larger aspect of the question. We are going to try to speed up housing. We are doing it by another disguise—Poor Law relief. I do not want to say more about the merits or demerits of that, because it is obviously outside the ambit of the present discussion, but surely if we want to avoid having to come back to discuss a similar Resolution in March next or even earlier, the matter is worth considering seriously, not so much from the point of view of relief as from the point of view of what the State can do to give productive work. On this question of housing, throughout the Bill, so far as I could see, there was practically nothing except a stimulus to housing in general Which the Bill might give towards lowering the unemployment figures. There was nothing at all about the subsidy being given only where materials were of British manufacture—

The CHAIRMAN

The hon. Member must keep to the point under discussion.

Viscount LYMINGTON

If we are to get on with the job we must try to see where the State can give the manufacturers of this country a chance, in return for guarantees that they are not going to make undue profits in giving people work. That is a form of Socialism with which anyone in this House can have sympathy, however much we may differ in methods. It is the form of Socialism that the hon. Member for Smethwick (Sir O. Mosley) has advocated. I would like to elaborate the words of the hon. and gallant Member for Thanet (Captain Balfour) about the sheltered industries. The sheltered industries of this country are at the present moment in a far better position, as regards their labour, than the unsheltered industries. I represent a constituency which is almost entirely composed of unsheltered industries. Someone may say, that it is necessary to lower the wages of the sheltered industries in order to spread them over the wages of the unsheltered industries. I am not going to say whether it is necessary or not, but it is one point of view. I do think, however, that if we are to look at this question with a whole mind and a clear mind, to take the agricultural industry alone, we must see that it is an extraordinarily difficult problem to cope with the outside world when you have some industries drawing twice the wages of other industries and at the same time being a tax on the production of the other industries less well paid.

The last thing in the world that I should like to see is a reduction in any wages, but if we are not to have a reduction in wages there should be some greater elasticity, some give-and-take in time and hours so that the unsheltered industries may get some benefit, because it is the unsheltered industries that are going to provide the employment in the end. In my own constituency the unemployment figures of agriculturists are not shown. They do not come under this Resolution. But at the same time practically every trade in Basingstoke, every factory, has to pay for its transport costs and pay heavily. Although the unemployment figures of agricultural labourers do not come under this Resolution, but come upon the Poor Law and the rates, they really come back upon the nation again and we have to find the money in some way. Hon. Members opposite should approach the Trade Union Congress as a whole and ask it to see what it can work out so that by more flexibility of hours of labour and various methods of improving things they may make it possible for transport costs and various other sheltered industry costs to be lowered for the benefit of employment in general.

Hon. Members are always pleading for co-operation, for a Council of State, and for a round-table conference. I heard the other day, as a little bit of smoking-room logic, that a motor car is run by B.P. and air, or run by Benzol mixture and air or run by Shell and air, but that in all those three ways of running a car the one constant component in the mixture is air, and that therefore air is what runs a car. That always seems to me a little like our efforts at co-operation and the round-table business. It always means that one states one's own point of view, it may be "petrol," it may be "benzol mixture," but the certain residue left over is mostly air, and that is the result of that form of co-operation. I agree with the hon. Member for Smethwick in the statement that open minds need to be filled. I agree with him again in the statement that the only way in which we can relate our sheltered industries to our unsheltered industries so as to give employment and give wages, is to insulate ourselves within the Empire, and make a country with a standard of living which will render it unnecessary to come back to this House and ask for more money.

Mr. LAWSON

I know there are other Members who still want to speak, but I would appeal to the Committee to bring the debate to a conclusion soon. I think that the Minister of Labour and the former Minister of Labour will agree that, while it has been the practice always to discuss Money Resolutions, they have sometimes been taken formally, and some- times have been debated only briefly, and the real discussion has been on the Second Reading. While it is true that there is no definite arrangement between those who are mutually responsible for the business of the House, I think there was some sort of tacit understanding that we would be able to get this Resolution and proceed with the next Order on the Paper to-day in order to facilitate business. That is the only reason why I now ask the Committee to exercise its judgment in this matter and bring this debate to a close on the understanding, of course, that there will be a big debate on Wednesday on the Second Reading of the Bill.

Sir A. STEEL-MAITLAND

If it is understood that there will be full opportunities for discussion on the Second Reading, I have no wish to ask anybody on this side to continue the present debate, but in order to prevent misunderstanding I must refer to what the Parliamentary Secretary has said, as regards the general practice in debates on Resolutions of this kind. I shall be very much surprised to find that what he says on that point is correct. It is true that the Report stage of the Financial Resolution in these matters has nearly always been treated as formal, but it is my recollection—though I do not presume to say so with certainty, not having looked up precedents—that on the actual initiation of such a Resolution in Committee, there often has been considerable debate. As regards an understanding I was no party to any understanding either expressed or implied, and as far as I know there was no understanding. I believe that an expression of opinion was asked as to how long it was thought the debate was likely to continue, and it may have been said, perfectly naturally, this being a Friday, that a debate of this kind was not likely to continue beyond two o'clock or half-past two o'clock, but that no undertaking could be given. It so happens that the debate has not been kept going by Members on one side of the House only. There has been a large amount of general interest shown in the subject and I think, in the aggregate, the speeches from that side of the House have occupied as many minutes, broadly speaking, as the speeches from this side. There has been no wish on our part to take up time, and I am sure that, as regards the Road Traffic Bill, none of us wish to prevent progress being made with it, or to prejudice the ultimate discharge of business for the Session. I have no wish to ask anyone on this side to speak in this debate, but, on the other hand, I think it is for hon. Members themselves to take whatever line they wish according to their interest in this question.

Mr. WARDLAW-MILNE

I think the Committee will acquit me of any desire to prolong the debate unduly or to obstruct business, but it must be perfectly clear that this is a matter of such immense moment that the Government would not be reasonable in asking hon. Members to curtail unduly the expression of their views upon it. I think the importance of this subject is sometimes forgotten. This one subject of unemployment is of outstanding importance in comparison with numerous other subjects which are debated in the House of Commons and although it is true that there are numerous opportunities for debating it, yet those opportunities do not always give scope for dealing with the causes of unemployment in their entirety, and with the results of unemployment on the national life and finances. I was much interested in the speech of the right hon. Lady the Minister of Labour. It was a very pathetic speech having regard to the nature of the problem with which it dealt. She will not be offended if I describe it as a speech which was of the utmost excellence from the point of view of a manager of a series of employment exchanges giving an account of his responsibilities and operations. She gave us a most excellent example of statistical knowledge. She dealt with the figures of unemployment, with the grouping of those figures in different categories, and with the effect of a continuation of unemployment benefit, payments on the finances of the Fund. But not one single word of her speech touched the real problem of unemployment or gave us any indication of her own or the Government's views on the matter which we are really here to discuss.

Two or three times in the course of this debate efforts have been made to bring the Committee back to a consideration of the actual financial results of the proposal which is before us and also to the reasons for bringing forward this Resolution. I propose to deal mainly with those points, but in the first place I would point out that the right hon. Lady did not answer a very pertinent question put to her from her own side of the Committee by the hon. Member for Gorbals (Mr. Buchanan). He asked her whether she was making sufficient provision in this Resolution for the finance which would be required and he asked, definitely, what would be the amount required if the unemployment figures increased. To those questions there has been no answer. I think the first and most important consideration for the Committee is whether £10,000,000 is even going to carry this Fund through the period during which Parliament will be in Recess. I do not pretend to be able to answer that question with the authority or knowledge of a Member of the Government who has access to official information, but it is not difficult, by means of the White Paper, to make some sort of estimate, rough and inaccurate though it may be as to exact, figures, of where we shall stand if, unfortunately, there is an increase in unemployment. I have made to the best of my ability an estimate of what I think is the answer to the hon. Member for Gorbals. He suggested a figure of 2,250,000 and he asked the Minister what would happen in the next few months if that figure were reached—which we all hope will not be the case. If my figures are at all accurate, I find that, if the number on the live register should rise to 2,100,000, the money now being voted would last to the end of December and if that number should rise to 2,300,000, or a fraction more than the figure about which the hon. Member for Gorbals asked, it would last only to the end of September.

I think the Committee are entitled to ask the right hon. Lady what she visualises as the course of unemployment in the next few months. She ought to know more than any of us of the prospects and possibilities. I do not suggest that she can give us a forecast of dead accuracy or that she should be held responsible if any figures which she gives do not turn out to be correct, but she is the one person in a position to give us any idea of the Government's view as to how long this money will last, and whether there is any pos sibility that it will be exhausted by the end of September, as would be the case if my very rough figures turn out to be accurate. Leaving that aside, and only saying that I hope we shall have an answer to that very important point, I want to deal with another point that has been touched upon to-day, and that is as to the categories of the people gathered under the head of the unemployed at the present moment. The right hon. lady, in the very interesting figures she gave us, referred to the cotton trade as showing 42 per cent. of unemployment, the iron and steel trade 29 per cent. and the coal trade 23 per cent. She gave us other figures which were equally interesting, but I will not weary the Committee with those again. The point I want to make is this: We speak in all these debates as if there were any doubt as to why there is serious unemployment. There is no difficulty to anyone in realising why we have this problem to face. No groping about is required to find out the causes. They are perfectly well-known to everyone who studies the matter and surely the figures I have quoted at once show clearly where the trouble is. At the same time, the fact that the figures for various trades are as put forward, shows how ineffective any system of public works, relief works—call them what you like—would be in really dealing with the problem.

The bulk of our unemployment., leaving aside the 600,000 or 700,000, or whatever the number may be, of people who are not likely ever to be fully employed in the future, and who, to my mind, should come out of this Unemployment Insurance Fund altogether and be dealt with quite separately—I think there is no doubt about that, and that the right hon. lady agrees that it is more desirable that 600,000 or 700,000 unemployable or largely unemployable should come out of this Fund, and that the Government and country should deal with them in a totally different way—but leaving that aside, it is perfectly clear that the whole trouble lies in those great industries, and it is useless for these debates to go on in this House on the basis that we do not know the causes of unemployment, and that we are seeking to deal with some problem which it is difficult to understand.

I would like to refer to the report of the Industrial Transference Board, which not only very clearly bears out the figures given by the Minister, but also deals more particularly with the actual numbers out of work in the various trades. I take those figures published a year ago, but the proportion is probably exactly the same, and they are the most recent figures, I think, which are available, at least, to the House generally. Of the total of 1,200,000 unemployed at that time, 292,000 were men temporarily stopped, 168,000 were women and 75,000 boys and girls. At that time therefore 852,000 adult men bad to be considered, and probably the same proportion exists to-day. Of that 852,000 at that time, I find that close upon 500,000 were unemployed in the coal trade, engineering, metal trades, building trades, and the distributing trades combined. The real problem lies in those trades, and it is not the slightest use our going on talking as if there were any doubt where the difficulties of the nation in this matter lie.

We are told that one of the remedies for the decline in these trades is rationalisation. We are told that if we will only rationalise the industries in this country there will be no difficulty in competing abroad and extending our trade. The word "rationalisation," like many other words which the House of Commons has adopted from time to time, appeals apparently in a very curious way to Members on all sides. I think a great many do not, perhaps, fully realise what it means. Strangely enough, the question of rationalisation has been dealt with, fortunately, by fairly competent and effective authorities, and the discussion on it, therefore, can be confined within fairly narrow limits. The Economic Advisory Council sent a deputation to investigate the iron and steel industries on the Continent, and, after an extensive tour in Germany, France, Belgium, Luxembourg and Czechoslavakia, they found it advisable to compare the conditions there seen with those existing in this country, and, therefore, they afterwards visited and examined British industries of the same kind with the result—it must have been surprising to some of them, and more surprising to a great many people who talk so glibly about the condition of British industry—that they found as regards efficiency of management and up-to-date equipment that British organisation was on the whole "equal to, and in some cases superior to those they had seen on the Continent."

It is clear, therefore, that merely applying rationalisation, which is so often suggested in this House, is blinking the real facts of the situation and is suggesting no remedy. The Economic Advisory Council found out some rather interesting facts, or rather they arrived at some conclusions already well known to those who have first-hand knowledge and experience of actual business, for the same report makes it clear where the real trouble lies. Wages in the iron and steel trade in Germany were 67 per cent. of those paid in this country; in France 50 per cent. only of those of this country; in Belgium, only 47 per cent.; and in Czechoslovakia, only 42 per cent. Ninety per cent. of the imports which compete with our industries in this class, and which cause the largest part of our unemployment, comes from those countries, and it is not the slightest use, whatever our party politics, blinking the fact that that is where the real trouble lies. The answer to the problem is perfectly simple. You either have to reduce your wages—I am not going to blink it—to compete with those countries, or in some other way you must maintain your standard of life and put your manufactures in a preferential position.

In this connection I would like to refer to the statement made once or twice today with regard to the difference between the sheltered and unsheltered trades. There is no question whatever that the great differentiation between the earning power of the wage-earners in the sheltered and unsheltered trades has a great deal to do with our industrial troubles, but the remedy is not to reduce the wages of the sheltered trades to the basis of the unsheltered trades. The remedy is to raise the wages of the unsheltered trades to those of the sheltered. How are you going to do it? That is the real problem. You have to reduce wages or raise the wages in the unsheltered trades to the basis of those in the sheltered industries; otherwise you cannot have the purchasing power in this country and get our industries back on to a satisfactory basis. It can only be done by having the unsheltered industries on the same basis as in other and protected countries. It is not permitted to me to go into the remedy so often put forward from this side, and as the limitation of the debate prevents me from doing so, I will not pursue the matter. But it is not the slightest use our coming here and talking about unemployment unless we are prepared to face the real problem.

As no person in this country desires the lowering of the standard of life of the people to the basis of that existing in the competing countries which I have mentioned, the only other remedy is to put your people in a position to have a sheltered market so as to get a higher price. There is no other remedy, and certainly we are entitled to-day to get from the Minister of Labour something a little more than what I have in her absence—and I hope she will not be offended at it—described as a most excellent speech from the point of view of a manager of a series of branch exchanges but not giving us the slightest help or indication of the Government's intention to deal with the basic problem which concerns the nation. The right hon. Lady said, that these great industries were suffering from world causes. I deny that that is the main reason. The main reason for their condition is the enormous imports of goods from other countries with lower standards of wages.

The cotton industry, however, where we have the largest measure of unemployment which will, I am afraid, make a still larger demand upon the Unemployment Fund, is one of the industries which is not in the category of those suffering from the imports of cheap goods from abroad. The cotton industry is in a very exceptional position, which has come about gradually and which can only be remedied by changes, internal and financial, in Lancashire and which are necessary to a greater extent than most people realise. In the old days Lancashire's cloth was produced from American cotton and sent out largely to India, China and other places. In the last 30 or 40 years we have been exporting machinery to the west seaboard of India, China and elsewhere, with the result that there is a large number of mills in those countries with British machinery producing cloth which is competing with Lancashire, and which is more suitable to the markets nearby the factories. In the last 30 or 40 years there have sprung up a great many mills in India, under Indian and British control, and in China, which make cloth of a class which is wanted and sold in the markets which are at their doors. It is clear that that must have had a big effect on Lancashire production.

Then there is the curious situation in India that Japan can take Indian cotton and, owing to subsidised arrangements for shipping, ship it to Osaka and turn it into cloth under conditions as to rates of wages and 'hours of work which would not be tolerated in this country and which, although they are gradually becoming more reasonable from a western standpoint, are still far below the standard of this country; and they can reship that cloth to India and sell it often in competition with the products of Indian mills. These are facts which make it clear why the short staple cotton trade of Lancashire in low counts has largely dropped away. We can only get the world markets, speaking broadly, in the finer counts of cloth that cannot be made from short staple cotton. In spite of many attempts of the Indian Government agricultural departments, the Indian grower has decided that it is to his interest to grow short staple cotton, which is suitable for the markets at its door, rather than long staple cotton. The result is that the competition against us from Indian mills is largely in coarser grades of cloth but as money extends and as civilisation extends there is a growing market in the east for the finer grades of cloth, and in the extension of that trade there is, I believe, salvation for Lancashire. Lancashire in any event will provide an increasing demand upon the Unemployment Fund in the near future and we are justified in asking the Minister whether there is or is not in fact some indication, which it is possible to give to the House, as to the position the Fund will be if, unfortunately, unemployment should go on increasing there and elsewhere.

I do not like a Financial Resolution of this sort to pass through the House of Commons without making it perfectly clear what the situation is. It is no use the nation not realising the position; it is no use living in the belief that unem- ployment will drop of itself. It will not decrease unless something drastic is done for our heavy industries. The figures which I have given regarding the numbers in different categories show clearly the absurdity of some of the proposals that have been put forward from the Liberal benches regarding these wild road schemes. There are hundreds of thousands of unemployed who are unsuited to be employed on public works of any sort. Skilled labourers and men and women in the distributive trades for example are unsuited physically and mentally for such work. The problem is not to be dealt with in that way. It is not more roads we want, but goods to go along the roads.

Mr. PYBUS

What remedy is the hon. Member suggesting for the cotton trade?

Mr. WARDLAW-MILNE

I thought that I made it clear that in my view the real salvation for Lancashire is in the development of its finer counts trade as the lower grade markets have probably largely gone in competition with Indian and Chinese mills. As to remedies for the main problem of unemployment in the heavy trades, I have already said that it can only be met by giving the home manufacturer a protected market, but I am not allowed under the conditions of this debate to pursue that matter. We ought to make the position perfectly clear to the nation. It is no good people being spoon fed with the idea that we can deal with this problem by granting more and more unemployment pay, or by any system of public relief or public works. There is only one remedy. We know what it is, and the whole nation should know what it is, but the question is whether the nation will make up its mind to accept what on this side we believe is the only possible remedy, in the safeguarding of our industries and a wide expansion of our Empire trade. I bad put into my hand to-day an interesting quotation, which I will read to show that this problem of unemployment relief is, alas, not new. It goes as far back as Roman times, for Tiberius Caesar, when asked to increase doles and pensions said: Industry will languish, laziness will increase, if no one has anything to hope for, or fear from himself. All will look for help from outside, be themselves idle and be a burden to others. I am not suggesting that we are arriving at a state in which the people of this country take a contented view of the situation, but there is no thinking person in this country who does not realise the awful demoralisation of this vast extension of our unemployment insurance system. It is no longer insurance at all. It does not matter what our political views may be. Everybody knows that no man can be continuously out of work without deteriorating physically and morally. It is against human nature to live by idleness, and I ask that at an important moment like this, when we have to vote £10,000,000 more money to-day, and will probably have to vote another £10,000,000 before many weeks or months have passed, we as a House of Commons should make it clear that we know what the trouble is, and that we are not blind to the difficulties which face the nation, and that we ask the nation really to make up its mind to face the evil and to apply the remedy.

Mr. KINLEY

I must express my regret that this Resolution should have been set before us to-day, in the bare form in which we find it, accompanied by a totally unsatisfactory statement from the Parliamentary Secretary and from the Minister. Every Member of the House must by now have noticed that one of the constantly recurring features of our debates is this subject of unemployment and the provision for unemployment, without our ever getting one inch further forward. All that can be definitely said is that the numbers of our unemployed are steadily increasing. So is the deficit on the Fund, and the time approaches when a still further appeal will have to be made to this Committee to provide still further money to carry on the same old game. The Government are doing nothing to grapple with the problem of unemployment. The figures mount week by week, and neither the Committee nor the Government is in possession of the facts as they are. Nor can the Government at any moment tell us definitely what are the prospects, even of the immediate future. Time after time we have been asked to make provision, and, just as on the last occasion I challenged the Estimate of the Government at that time, so I challenge it to-day.

In the Paper before us, we have what must be taken as the Government's estimate of the maximum of our unemployment figures for the period under review, namely, 1,900,000. No one in this country who knows anything about unemployment or about the economic condition of the country believes for a moment that our unemployment figures are going to be stabilised at 1,900,000, and, as a matter of fact, we know that the figures are already far in excess of that. The estimate does not include the 60,000 odd who have been turned down on the ground that they are not "normally in an insurable occupation." They are left entirely outside this calculation; yet they are unemployed. The numbers of the older ones who are unable to live on their 10s. and are still compelled to go where they can and when they can to seek a job are not included in the estimates. I appeal to the Minister, and to all members of the Government who deal with unemployment, to face the question honestly and well, and not to try to persuade us that because a half or a quarter of the unemployed have done some work during the past month they are in the category of persons who are not unemployed. It does not matter whether they work a day this month or two days, they are unemployed persons, for whom provision must be made. The evil of the whole business is that, while we are being asked from time to time to make still further provision, we know that it is only a matter of months before we shall be discussing a further appeal to bolster up this Fund in which no one places the slightest reliance. It only means that, in the opinion of the Government, the present state of affairs is going to continue for such a further period that it is essential that additional money shall be borrowed in order to provide the benefit.

3.0 p.m.

It means that the Government still have no unemployment policy. Is that the message that has to be taken by the unemployed? If they are going to be provided with work, either directly or indirectly, by the Government, this Fund will not be necessary, and the Fund is going to be necessary only on condition that the unemployed are going to remain unemployed. With that view, I must agree. We have done nothing at all. It is not the business of the House, it is the business of the Government, to provide for the unemployed of our country. It has been the business of every Government to make provision for all those who, under its laws, are prevented from earning what they require for themselves and their dependants. It is the duty of the Government to deal with this problem and to bring the unemployment proposals before the House. If those proposals should be turned down, then the Government would have reasonable excuse. Until that time comes, the Government have no defence, however severely they may be criticised. All that they can tell the House is that from what they have ascertained and from what they can foresee of the future, the outlook is that unemployment in three or six months' time is going to be what it is to-day, utterly hopeless. And it will undo this Government just as it undid the one before.

Mr. MOND

The policy which we are adopting from time to time of voting in Committee small sums of money to carry on the Fund for paying unemployment insurance, is one for which I do not particularly blame the present Government, because it is a policy which its predecessor had to follow. The main objection is that you drift along and that you are never forced to grapple with the real position. I think this Resolution should not be passed. The Committee should make up its mind that, until there is a real and definite attempt to solve the problem which successive Governments have failed to deal with, we are not to vote any further money. In industry you have to take drastic action in order to pull your affairs straight. The Government are bound also to take drastic action. Merely borrowing money, as we are proposing to do to-day, makes matters worse. It is merely spending money that you have not got, and continually piling up the difficulties that produced your unemployment.

The amount of money that you are proposing to borrow is not anything like sufficient. The estimates of the White Paper are already exceeded. The Ministry of Labour knows perfectly well that they are going to be further exceeded. The Minister has given us some exceedingly interesting figures, but we have had no figures from her to tell us what is the real position. I do not wish to appear depressive about the real posi- tion of industry, but I hope things are taking a brighter and a better turn. It is quite likely that the money that the Minister is going to get this afternoon will not carry her through the immediate Recess. I think it is disgraceful that the Government should shelve its responsibilities by coming for a small amount, when the real amount is very much larger, so far as anybody can humanly foresee.

There are one or two points about the actual figures of this Resolution which should be brought to the attention of the Committee. When the Government took office the Fund was in debt to the tune of £36,870,000, and on the proposals in front of us the debt will be up to £60,000,000 by the 31st March. As a matter of fact, it will probably be at that figure very much sooner. Therefore, the increase of debt under the Socialist administration amounts to £23,000,000. And that is not tale whole story of the Government's "rake's progress." The Act of 1929 raised the State's contribution by one-third and that relieved the Fund automatically of £3,500,000; the Act of 1930 placed the cost of transitional benefits on the State and therefore automatically increased the revenue of the Fund by £10,500,000; so there is £14,000,000 to add on to the £23,000,000 which is over and above the debt which the Government inherited from their predecessors. The Unemployment Insurance Act of 1929 increased the cost of unemployment insurance. I should like the Minister to tell us by how much that cost has been increased. I do not believe she can; I do not believe the Government have the slightest idea. Many hon. Members, I was one of them, protested at the time against an alteration of the old system of unemployment insurance by which it was entirely removed from an insurance system and turned it into a system of mere Poor Law relief. The change increased the cost without really increasing the contributions, because the new contributions were made by the State and not by the other two contributors, the employers and the employees; and, as I pointed out at the time, an increased contribution by the State means nothing at all except an additional but disguised burden on the other two contributors.

Mr. ALPASS

If the hon. Member had gone through the experience of be- ing out of work and searching for it and had been subjected to the old treatment he would not talk like that.

Mr. MOND

On this financial resolution I am not allowed to discuss the ethics of unemployment, I am merely discussing the finance, and if the hon. Member understood finance he would realise that, however much his heart may be with the unemployed, he will not improve their position by ruining the country. [Interruption.] If we are not to be allowed to discuss financial resolutions on a financial basis we shall very soon have a bankrupt country in which the unemployed will not be able to get, their £10,000,000, because there will not be £10,000,000, and hon. Members opposite must search round to find where the money is to come from to pay their own salaries, because there will not be any money. [Interruption.] One of the great difficulties—

The CHAIRMAN

If the hon. Gentleman is interrupted he is entitled to reply to the interruption, and further interruptions will only protract the debate and prevent other hon. Members who wish to do so from being able to speak. There have been as many speakers from the Government side to-day as there have been from the other side.

Mr. MOND

The difficulty with which this House is faced in dealing with the present situation is that it is very difficult indeed for a serious financial discussion to take place when there is such a very large number of hon. Members who have no knowledge of financial matters. [Interruption.] I do not know why hon. Members laugh at that statement.

An HON. MEMBER

Surely it is not out of order for an hon. Member to laugh.

The CHAIRMAN

Yes, but the laugh should not be indecorous.

Mr. MOND

I ask the Minister of Labour to give us some information as to the increased cost and to state whether she thinks that this Fund will be exhausted by the end of the year, after the sum being voted by this Resolution has been taken into consideration.

Mr. MACQUISTEN

On this matter I am in sympathy with the Government, because the Government have got into a terrible mess over unemployment. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George), with his fertile mind, stimulated by the labour bureaux, invented unemployment insurance. Once you begin a scheme of this kind it is like beginning a strike: you do not, know when it will stop. This reminds me of the story, told by a friend of mine, of an old man who had difficulty in meeting his landlady's bill. The old man came to him for assistance, and he gave him what he required. Next week the old man came to my friend's office again and got assistance for that week. My friend got tired of that, and told his clerk not to admit the man, but he still came and waited in the outer office. At last, the clerk asked him what he was waiting for, and he said, "I have come for my aliment." In dealing with unemployment each Government simply goes on from hand to mouth and refuses to face the difficulty. It is all very well for the Member for Aston (Mr. Strachey) and the hon. Member for Smethwick (Sir O. Mosley) to put forward suggestions, but they, know nothing about business. I remember a case of corruption on certain benches administering a certain Act, where there was one man who said that he much preferred the man who would take a wad of notes or gold to the man who wanted him to get justice, because that was so much more expensive. That is the position here. The Government are trying to provide work when they themselves have never been engaged in business. There is as much difference between Government officials and people who have a thorough knowledge of business as there is between chalk and cheese. I have not the same interest in chalk as in cheese, but one realises which of the two is likely to be the more nourishing. One explanation of the present unemployment is undoubtedly the Washington Convention. We were always building battleships, cruisers—

The CHAIRMAN

We cannot discuss the Washington Convention on this Resolution.

Mr. MACQUISTEN

I have no intention of discussing the Washington Convention, but one of its effects undoubtedly is the present want of work in the iron and steel trade. You cannot have it both ways. You cannot say that you are going to disarm and still maintain work in the iron and steel trade. We were not only building ships for ourselves, but also for other countries. That is the real cause of our unemployment in the iron and steel trade, and it has also largely affected the coal trade, which, of course, had an enormous demand for the making of iron and steel. You cannot have it both ways, and you are bound to get into this position in those trades.

I do not reproach the Government for having no unemployment policy. How could they have an unemployment policy? Where are you going to get those eminent supermen, whom politics do not throw up, to people the Front Benches, who are going to be wise enough to find occupation for innumerable people. It is not sufficient to find any kind of work; people want to get employment at their own jobs. Nearly all the employment schemes outside Glasgow have only had the result of bringing in a lot of Irish labourers from Southern Ireland, who have been of practically no use to Scotland. I do not, therefore, reproach the Government for not having a policy. I think it is very wise for us to realise that this Government is just as full of limitations as any other Government. The only people on their side who are prepared with policies are people like the hon. Member for Aston and the hon. Member for Smethwick, who are purely theorists, and have never been engaged in any business in their lives. They are like the old maids who always know how to bring up children. That is the type of man who comes to this House and claims to be able to solve all our troubles, because he has never had to face them. He has either been born with a gold spoon in his mouth or else with the gift of the gab, which enables him to obtain everything he wants, either with his pen or with his tongue. When a man is insolvent and goes to someone else for assistance, he always understates his difficulties, and in the same way the unemployment figures are very much understated; there is no doubt that they are very much larger than they are said to be.

Under most Governments this country has suffered very much from over-taxation. The present Government has gone one better than the last, which was bad enough. We are now suffering from an enormous increase in the activities of Government officials, and the Lord knows what the position will be 20 years hence. We shall be paying pensions to so many Government officials that one-half of the country will be Government officials and the other half will be working to support them. It is now proposed that we should raise the school-leaving age and pension off people at my age, though I do not feel in the least inclined to be pensioned. It would be far better to say that each man should work to keep another man; then there would be work for everyone. I believe that there are certain Members on the benches opposite who would keep people at school till they were 21 and give them old age pensions at 40. Then everybody else would be busily employed. What we are suffering from is over-taxation and the enormous increase of Government activities and Government officials. I remember the right hon. Gentleman the Member for Epping (Mr. Churchill), when Chancellor of the Exchequer introducing a, Budget, saying that, in consequence of various pledges that had been made, he had had to add £25,000,000 a year to the expenses of the country, because everyone had made the necessary promises that they required to make in order to get back to office. That was a point of view that shocked me very much, because it seemed to be an admission that, if parties had to make promises in order to get back to power, there was not very much difference between politicians and the Chester-le-Street guardians. What the country wants is politicians who will stop making promises and face the country with the grim situation in which it is.

Mr. WALLHEAD

On a point of Order. Is it in order for the hon. Member to discuss the Budget in the course of a speech on a Financial Resolution?

The CHAIRMAN

He is not doing so.

Mr. MACQUISTEN

If you are going to have a shaking of confidence and a breaking down of initiative, those who are capable of giving employment will cease to do it. Their efforts will come to an end. The vast mass of mankind seem to be devoid of initiative. They say, "Give us a job." If they had initiative, the ends of the earth are open to them. They could work their passage and go to some remote part of the globe and grow enough to live upon, and develop their initiative. They have not got it. They have to wait for someone to employ them. They have raised wages to such a figure that they are like the Irishman whose wages were so high that he could never get them. The taxation is very discouraging, and it is not only the taxation but the intimidatory speeches of hon. Members opposite, who say they are going to bring everyone down to a common level. The equal treatment of people who are unequal is the greatest of all injustices. There is a mental stagnation which is largely the result of the increase of taxation, and initiative is being killed. No one will start a new enterprise. It is not worth doing. Until there is a Change in psychology and a man is allowed to reap what he has sown without the State coming along and depriving him of it, we shall have very great difficulty in reviving our prosperity.

I have sufficient faith in the common sense of the vast mass of the working people, though they are sometimes singularly inept in the choice of their representatives, to believe that elementary principles will reassert themselves and that they will realise that there is no division, that capital and labour are like husband and wife, who have to live together for the sake of posterity. The trade unions, and the tremendous conservatism of the working man, will not allow the adoption of the most recent ideas. We have to get new ideas. We have to get the old decadent, reactionary Toryism which affects hon. Gentlemen opposite weeded out and get to a more scientific view of life, and when we have got that scientific view of life, and not till then, we shall probably solve the unemployment problem.

Mr. REMER

I think that everybody to-day will be very grievously disappointed with every word which has been said from the Treasury Bench on the question of this Motion. The Parliamentary Secretary to the Ministry of Labour seemed to think that every Minister on the Treasury Bench should be presented with a kind of medal to show his efficiency in dealing with the problem. I do not think that the hon. Gentleman will be able to say now, having listened to the debate, that he has had many bouquets thrown at him this afternoon, but I think he will realise that a good many of the bricks, which have been thrown have come from the benches behind him. I would like to ask a question in a different form from that in which it has been asked previously. Why is it necessary for this sum to be raised to £60,000,000 and how long will it last? It seems to be clear, arising out of what the hon. Member for Gorbals (Mr. Buchanan) said earlier in the Debate, that the sum is likely to be very much more than £60,000,000 before we come back in the Autumn. If last week's increase in the unemployment figures of 43,000—which has practically been the weekly increase—continues in this terrible way, the total will not only reach 2,500,000, as has been pointed out, but it will reach 3,000,000 by Christmas. That is a most appalling thought, but it is the only thought we can have so long as the maladministration of the present Government and the muddling of all affairs both international and national continue.

The Parliamentary Secretary stated that he came to the House to-day very regretfully to ask for the additional £10,000,000. I think that by discussing this matter at all we are placing the Committee in a most degrading position. I entirely sympathise with the view of one of my hon. Friends that it would be far better to say to the Minister of Labour, "You cannot have this money," and by that means force the Government to deal with the matter in the way in which it should be dealt, namely, that there should be a proper and intelligent view taken of this great problem. As long as the Government adopt a policy deliberately antagonistic to every kind of trade, not only in this country, but also in the British Empire, then unemployment must grow.

My hon. Friend the Member for Kidderminster (Mr. Wardlaw-Milne) mentioned the cotton trade and the decline in the demand for Lancashire goods in India. I disagree with one thing he said, namely, that he thought the demand for Lancashire cotton goods in India had gone for ever. We find that that trade has gone largely to Japan. The figures are appalling. In the year 1913 3,000,000,000 yards of cotton cloth went from Lancashire to India, and last year only 1,400,000,000 yards went to India. In 1913, Japan sent only 3,000,000 yards of cotton cloth to India, and last year she sent 587,000,000 yards. Yet the Government sit down and do nothing to deal with this appalling situation, when it is quite obvious to them that with quite a reasonable policy they could put that matter in order. The Government are always stating that this state of things is entirely due to world conditions. Do they realise that these world conditions are very largely caused by themselves? Do they realise that, with the British Empire having one-fourth of the whole population of the world, and the Government not doing anything to help the British Empire, they are making the world conditions worse than they might be if they took an intelligent view of the situation.

The Parliamentary Secretary has said that we ought to be very thankful to the Chancellor of the Exchequer for the way in which he has handled the Unemployment Insurance Fund. What did he do? He increased the contributions of the employers and employed, and made them pay more week by week.

Mr. LAWSON

When did that take place?

Mr. REMER

I think it was in the first Bill.

Mr. LAWSON

Certainly not.

Mr. REMER

Yes, I think so.

Mr. LAWSON

You are wrong.

Mr. REMER

I am sure that the contributions were increased by the Chancellor of the Exchequer in the first Bill.

Mr. LAWSON

I am sure that the hon. Member is one of the very few Members of this House who has not been taking an active and intelligent interest in the question.

Mr. REMER

I am sorry that the Parliamentary Secretary takes exception to my intelligence. My memory tells me that it was in the very first Bill dealing with these matters that the Chancellor of the Exchequer increased the contributions, but I will let that pass. [HON. MEMBERS: "Oh"] It was not the point of my argument. I was only using that in passing. I do not think the pub- lic have a conception of the charge that this Unemployment Insurance Fund is upon the general trade and business of the country. The contributions for this purpose are a more direct tax on industry than Income Tax or any other tax, because it has to be paid whether the industry makes a profit or not. It is a very astonishing thing that a sum of £75,000,000 a year is paid by employers in this country in respect of Unemployment Insurance, National Health Insurance, and the Widows, Orphans' and Old Age Pensions Act. A slightly less amount is paid by the employés. That amount of money has to be paid whether profits are made or not.

The hon. Member for Aston (Mr. Strachey) referred to the paying off of £5,000,000 of the Sinking Fund and the borrowing of £10,000,000. There has grown up in our national system of finance in very recent years a pernicious habit of creating a fund to do this or that. The Unemployment Insurance Fund is about £50,000,000 in deficit, while the National Health Insurance Fund has a huge surplus, and I suppose the Widows', Orphans' and Old Age Pensions Fund has a surplus. The Road Fund, which the Minister of Transport superintends and which we ought to have been discussing to-day, has also a surplus. This system of finance reminds one of a big industrial concern, with several companies, which mixes up its finance in such a way that it is most difficult to understand the ramifications of that finance. These different funds ought to be put on a proper business footing.

The Government stand condemned by this Financial Resolution. They are devoid of any ideas, constructive or otherwise; and they look on callously and cruelly. In the last Parliament the right hon. Gentleman the First Commissioner of Works used to came down to the House day after day and say, "What are the Conservative party doing for unemployment? Nothing." I am going to say that this Government, which came in with such bright promises, has done nothing to help unemployment—I apologise, they have provided the famous Lido in Hyde Park. The whole country is crying out for a General Election in order to get rid of the wretched people on the Treasury Bench as quickly as possible. If there had been a Conservative Government in office with 2,000,000 people out of work, hon. Members opposite would have been suspended every day in dozens. Some years ago the right hon. Member for Epping (Mr. Churchill) asked the pertinent question, "Is Labour fit to govern?" Hon. Members opposite were very indignant that such a question was asked, but we know now, by the discreditable way in -which they have managed the affairs of this country, that they are utterly unfit to govern and the country only wants an opportunity to tell them so in no uncertain voice.

Question, That it is expedient to raise to sixty 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.

Put, and agreed to.

Resolution to be reported upon Monday next.