HC Deb 11 December 1933 vol 284 cc41-169

Considered in Committee (under Standing Order No. 69).

[Sir DENNIS HERBERT in the Chair.]

Motion made, and Question proposed. That, for the purposes of any Act of the present Session to amend the Unemployment Insurance Acts, 1920 to 1933, and to make further provision for the training and assistance of persons who are capable of, and available for, work but have no work or only part-time or intermittent work, and for purposes connected with the matters aforesaid (hereinafter referred to as the said Act)—

A. it is expedient, in. connection with the provisions of the said Act amending the Unemployment Insurance Acts, to provide (from and after the date on which the provisions of section five of the Unemployment Insurance Act, 1921, empowering the Treasury to make advances to the Unemployment Fund, and paragraph (4) of article eight of the Unemployment Insurance (National Economy) (No. 2) Order, 1931, are repealed)—

  1. (1) for the payment out of the Consolidated Fund—
    1. (a) to the National Debt Commissioners of such sums, by way of temporary advances to the Unemployment Fund (to be repaid with interest to the Exchequer within six months), as may be necessary to make good any insufficiency of the fund to pay any instalment required by Part I of the said Act to be paid towards the discharge of the liability charged on that fund by section five of the Unemployment Insurance Act, 1921, in respect of advances made thereunder with interest thereon and the liability incurred by the Treasury to the National Debt Commissioners in respect of the provision of money for the purpose of the said advances;
    2. (b) to the Unemployment Fund of such sums by way of temporary advances (to be repaid to the Exchequer with interest before the end of the financial year) as may be required from time to time for the purpose of making any payments properly falling to be made out of the Unemployment Fund other than any such instalment as aforesaid and the repayment of such temporary advances as are mentioned in the last foregoing sub-paragraph;
  2. (2) for the payment out of moneys provided by Parliament—
    1. (a) of such sums by way of advances to the Unemployment Fund (to be repaid to the Exchequer with interest not later than the end of the second financial year next following) as appear to the Treasury to be required to enable that fund to discharge any liabilities (including the due repayment of any such temporary advances as are men* 42 tioned in the foregoing paragraph (1)), which, in the opinion of the Minister of Labour, after consultation with the Treasury, that fund is or will shortly become insufficient to discharge;
    2. (b) of any increase attributable to the passing of Part I of the said Act in the sum payable out of moneys provided by Parliament by virtue of Sub-section (3) of Section five of the Unemployment Insurance Act, 1920, as amended by Section one of the Unemployment Insurance Act, 1929, or by virtue of Sections forty or forty-one of the Unemployment Insurance Act, 1920, or of section three of the Unemployment Insurance (No. 3) Act, 1931;
    3. (c) of any sum by which any education grants under any other Act are increased by reason of the additional nowers and duties conferred and imposed by Part I of the said Act on education authorities;
    4. (d) of any increase attributable to the passing of the said Act in the amounts which are by virtue of paragraphs (1) and (2) of article eight of the Unemployment Insurance (National Economy) (No. 2) Order, 1931, to be paid into the Unemployment Fund; and

B. it is expedient, in connection with the provisions of the said Act amending the Unemployment Insurance Acts, to provide for the payment out of moneys provided by Parliament of any expenses incurred by the Minister of Labour in carrying Part I of the said Act into effect; and

C. it is expedient, in connection with the provisions of the said Act relating to Unemployment Assistance, to provide—

(1) for the payment out of the Consolidated Fund to the several members of any Unemployment Assistance Board constituted by the said Act of such salaries as may be determined by the Treasury at the time of their appointment respectively, so, however, that the aggregate amount of the salaries of the members of the Board shall not exceed the sum of twelve thousand pounds per annum; and

(2) for the payment out of moneys provided by Parliament—

  1. (a) of the salaries and allowances of the officers and servants of the said Board and the remuneration, salaries, and allowances of the members, officers, and servants of any appeal tribunals constituted under Part II of the said Act;
  2. (b) of such contributions to the said Board as the Minister of Labour, after consultation with the said Board and with the consent of the Treasury, may determine to be sufficient together with annual local authority contributions to enable the Board to pay to such persons as—
    1. (i) are between the ages of sixteen and sixty-five years; and
    2. 43
    3. (ii) are either persons whose normal occupation is employment in respect of which contributions are payable under the Widows', Orphans', and Old Age Contributory Pensions Acts, 1925 to 1932, or persons who, not having normally been engaged in any remunerative occupation since attaining the age of sixteen years, might reasonably have expected that their normal occupation would have been such employment as aforesaid but for the industrial circumstances of the districts in which they reside; and
    4. (iii) are capable of and available for work, allowances based on their needs and those of their households, regard being had to the resources of all members of the household other than such resources as may be excepted by the said Act;
  3. (c) of such contributions to the said Board as the Minister of Labour, after consultation with the Board, may with the consent of the Treasury determine to be necessary to enable the Board to provide or arrange for the provision of training, instruction or occupation for such persons as aforesaid, to make payments to such persons while undergoing training, to make adjustments with public assistance authorities in respect of relief granted to persons who are or might have been entitled to such allowances as aforesaid and to defray any administrative and incidental expenses incurred in carrying Part II of the said Act into effect, and any expenses incurred in giving effect to reciprocal arrangements made thereunder in relation to Northern Ireland;
  4. (d) of any superannuation allowances, lump sums and gratuities payable under the Superannuation Acts, 1834 to 1919, by virtue of the provisions of the said Act;
  5. (e) of the expenses of any Government Department attributable to the carrying of Part II of the said Act into effect.

In this Resolution the expression "annual local authority contributions" means, in relation to each of the three years ending on the thirty-first day of March, nineteen hundred and thirty-seven, contributions to be made to the said Board annually by the councils of counties, county boroughs, and largo burghs, computed as follows: the contribution of each council shall (subject to any adjustments necessitated by changes in boundaries and, in the first year, to an abatement in respect of the fact that the said Act will not be fully in operation for the whole of the year) be three-fifths of the sum of the two following amounts, that is to say:

  1. (i) the estimated expenditure (excluding the cost of administration) incurred by the council in the year ending on the thirty-first day of March or, in the case of Scotland, the fifteenth day of May, nineteen hundred and thirty-three, on the provision of relief (not being relief in respect of 44 medical needs) to persons to whom Part 11 of the said Act would have applied if it had then been in operation, upon the assumption that no persons would in that year have been deemed not to be such persons by reason of special reports made in their case under the provisions of Part II of the said Act; and
  2. (ii) the difference between the estimated cost of administration incurred by the council in the said year in connection with the provision of relief and the estimated cost of administration which would have been so incurred if Part II of the said Act had then been in operation;
subject, however, in the case of any council which in the present financial year is receiving a grant out of moneys provided by Parliament for special grants to local authorities in distressed areas, to the limitation that the annual contribution of the council shall not exceed the difference between that grant and the sum of the two amounts as aforesaid, and subject also in the case of all councils in any of the said years in which the cost of relief provided in Great Britain by reason of persons becoming chargeable to such councils in consequence—
  1. (i) of the withholding of allowances in cases of special difficulty owing to the breach of conditions on which the allowances were granted; and
  2. (ii) of persons becoming ineligible for allowances by reason of special reports made in their case under the provisions of Part II of the said Act, exceeds 5 per cent. of the total contributions, to a reduction equal in the case of any council to a proportionate part of the excess.—(King's Recommendation signified.)—[Sir S. Betterton.]

3.45 p.m.

The MINISTER of LABOUR (Sir Henry Betterton)

In moving the Resolution I can assure hon. Members that although, at first sight, it may appear to be rather formidable and obscure, if we strip it of that legal and technical phraseology with which every Department finds it necessary to clothe their simplest thought, the Resolution becomes quite plain and easily understandable. I will endeavour to explain in simple language what the Resolution does. It is divided into three parts, A, B and C. Part A deals with two points: (1) the new provisions in the Bill affecting the solvency of the fund and (2) the increased charges on the Exchequer which are attributable to Part I of the Bill. Part B contains the usual provisions authorising expenditure arising out of new legislation to be charged upon the votes. Part C deals with the charges on the Exchequer in respect of the schemes of assistance out- side insurance, which is set up under Part II of the Bill. I will deal with the items in turn.

Under Part A paragraphs 1 (a) and 1 (b) refer to the provisions to preserve the solvency of the fund. Clause 18 of the Bill repeals the existing power to borrow money from the Treasury up to the limit of£115,000,000. I need not recite the various provisions which from time to time enabled amounts to be borrowed from the Treasury. It will be remembered that the limit of£115,000,000 was fixed by the Unemployment Act which was passed by the last Government in July, 1931. The National Economy (No. 2) Order which was passed by the present Government a little later in 1931 provided that when the limit of£115,000,000 was reached any further deficiency should be met by a special deficiency grant from the Exchequer. In the two financial years 1931-1932 and 1932-1933, taken together, the deficiency grants paid by the Treasury when the limit of borrowing was reached amounted to£7,000,000, but I am glad to say that, following upon the improvement in employment no deficiency grant has been necessary in the current financial year. Indeed, from the beginning of November of this year it has been possible to repay part of the Treasury advances.

The position to-day is that the debt on the Fund amounts to£112,100,000. Under the Bill the outstanding debt will be amortised, and the debt, including interest at a general rate of 3½ per cent., will be repaid over a period of about 40 years by half-yearly instalments of£2,750,000. This, in future, will be the normal procedure for the repayment of the debt. Having cleared the ground so far, may I now explain exactly what paragraph (1, a) and paragraph (1, 6) of the Resolution do, and why it is necessary to insert them. It is clearly not possible to leave the fund without some powers of borrowing to meet temporary emergencies. The demands on the fund might be so heavy that for instance it might be impossible in a particular year to pay the half-yearly instalments for the redemption of debt. It is conceivable that a position might arise when payments of unemployment benefit in a particular week could not be authorised because sufficient money was not available out of current income. It is to meet these contingencies that paragraphs (1, a) and (1, b) are necessary. Let me refer to the first of these possible contingencies—namely, the inability of the fund to pay an instalment in redemption of debt. To meet this, should it arise, the Treasury would make the payment from the Consolidated Fund, and the amount so paid would be regarded as a temporary loan to the Unemployment Fund, but such temporary loan must be repaid by the Unemployment Fund within six months.

The next contingency was that the Fund would be unable to meet its current liability in any particular week. To meet this contingency the Resolution authorises the Treasury to lend money from the Consolidated Fund; and such loan must be repaid before the end of the current financial year in which the advance is 'made. That explains the necessity for paragraphs (1, a) and (1, b). Paragraph (2, a) is really a necessary corollary of what I have stated in regard to paragraph (1). It deals with the situation which would arise if the fund were unable to repay Treasury advances or meet other liabilities. In that event further loans could be made out of moneys supplied by Parliament as distinct from Treasury advances, and a special estimate would have to be submitted to Parliament in order to cover the proposed loan. This would ensure Parliamentary discussion on the finances of the scheme and would be quite apart from the consideration of reports of the Statutory Committee, to which I referred in my Second Reading speech on the Bill. It is provided, however, that loans voted out of monies under this authority must be repaid by the fund in the two financial years following that in which the loan was made. The reason why we have put in two financial years is in order that there may be time for any changes recommended by the Statutory Committee to be carried into effect and to become effective. These two provisions deal with the question of the solvency of the fund, and that is all I have to say, or, indeed, all that I can say, upon that part of the Resolution.

So far it will be observed that I have dealt only with those items which do not involve a final charge on the Exchequer, with those items for which repayment to the Exchequer is provided. I now come to paragraph (2, b). This relates to the actual expenditure to be met out of moneys voted by Parliament in respect of insured persons, and the new class of juveniles, and, of course, hon. Members know that this is an important part of the Financial Resolution. There are three main items concerned. There is first, the Treasury contribution which will be necessary in respect of the insured persons for the new class of juveniles. Secondly, it includes the Exchequer contribution which will be necessary in respect of the additional benefits we are providing for men discharged from His Majesty's Forces, and, thirdly, it includes the Exchequer contributions in respect of the benefits which will be payable, beginning 10 years hence, to short service men discharged from the Metropolitan Police Force. I will deal with each one of these items quite shortly. First with regard to juveniles, as I said the other day it is proposed that the weekly Treasury contribution in respect of a juvenile shall be 2d.; and of course it is 2d. from the employer and 2d. from the juvenile. The cost to the Exchequer is estimated to amount to an annual sum of£253,000. The next item is the cost relating to men discharged from His Majesty's Forces.

In the Act of 1920 it was provided that when men were discharged from His Majesty's Forces on the completion of their term of service they might qualify at once for the payment of insurance benefit. Ever since that provision has been in operation men discharged from His Majesty's Forces have been in exactly the same position as insured contributors with a first class record. At present when a man is discharged from His Majesty's Forces he can qualify at once for 26 weeks benefit if he is unable to obtain employment, and it will be remembered that under the Bill we propose to extend this minimum of 26 weeks to a possible maximum of 52 weeks in accordance with the applicant's record of insurable employment during the previous five years. In regard to the position of ex-service men we have decided to maintain the same principle as applied in the past—namely, to treat them for this purpose as if their period of service in His Majesty's Forces had been in ordinary insurable employment. In other words, men discharged from His Majesty's Forces will find themselves able to qualify for additional benefit. Moreover, this credit of contributions will be available when considering the title to additional benefit in subsequent years. The additional cost of this to the Exchequer is estimated at£300,000 per annum, and two-thirds of that sum will be borne upon the Votes of the Fighting Services and the other third on the Estimates of the Ministry of Labour.

There is one further point I might mention with regard to this matter. It would be an anomaly if you gave this right to a man discharged the day after the Bill becomes law, and denied it to a man. discharged from His Majesty's Forces the day before the Bill became law. That would be an indefensible anomaly, and, in order to deal with it, it is proposed that the provision for additional benefit should be applicable to men discharged during the last five preceding complete insurance years, that is, since 30th June, 1927. The interests of ex-service men will thus be fully protected, and an anomaly will be avoided which certainly otherwise would have arisen. The cost of this additional benefit for men discharged before the Bill comes into operation is estimated to be about£400,000 over a period of five years, and, as in the case of men discharged after the Bill becomes law, it is provided that two-thirds of the cost shall be borne by the fighting services and one-third of the cost on the Ministry of Labour Vote. The principle to which I have referred will also apply to the new arrangements for short-service constables in the Metropolitan Police Force. There will be no charge in respect of this provision until about 1943, when the first short-service constables will have completed their 10 years' service.


What is the estimated cost?


It will not arise for 10 years, and, at the moment, I cannot say. The next thing to which I want to refer is paragraph (2, c), which provides safeguards against the possibility that in some circumstances—I am told it is a very small point—the education authority in a particular case might be eligible for an increased education grant. Only a very small sum is likely to be involved. I come to paragraph (2, d) which is at the end of the first part, and relates to the necessity for continuing payments to classes now drawing transitional payments from 1st July, 1934, until Part II of the Bill becomes fully operative. The general effect of that will be that the Unemployment Assistance Fund will be established at the same time as the full scheme under Part II of the Bill comes into operation.

As I have already pointed out, part B of the Financial Resolution is the common form provision authorising expenditure in respect of new legislation to be charged on Votes. Perhaps the most important item is the Exchequer contribution towards the courses of instruction for juveniles. As I explained in my Second Reading speech, the Bill proposes that there shall be a duty put upon local education authorities to provide these instruction centres where the need arises. It is not possible to say what the total cost of this will be when the scheme comes into full operation, because, obviously, it depends on the amount of unemployment at the time. All I can say, in answer to the hon. Member for South-West Bethnal Green (Sir P. Harris), is that on the basis of an average total attendance of 100,000, the estimated additional cost of the centres will be£1,130,000 in a full year.


Will that include the contributions from the local authorities?


I am going to explain that. Now, as I said the other day, the proposal is that 25 per cent., or one-quarter of this sum of£1,130,000, shall be borne by the local education authorities. A quarter of that sum amounts to about£280,000. The other three-quarters is to he borne as to half by the Exchequer and half by the fund. The amount of the half which is borne by the Exchequer is estimated, on the figures I have given, at£425,000, and it is for that, of course, that this Resolution is necessary. Part C of the Resolution deals with the charges upon the Exchequer which will result from the new scheme of assistance which is provided for in Part II of the Bill. It is stated in the Financial Memorandum which is printed in front of the Bill that no precise estimate of the total cost of the new scheme could be made. I need not read the Financial Memorandum, but hon. Members will find the relevant passages beginning at the top of page viii.

Paragraph (1) of Part C relates to the provisions in the Fifth Schedule to the Bill, and deals with the setting up of the Unemployment Assistance Board. The Fifth Schedule provides that the Board shall consist of a chairman, a deputy-chairman and not more than four other members. They will be appointed by Royal Warrant which will contain the terms and conditions of their appointment, including the period of their office. It is proposed that the salaries of the Board shall be paid out of the Consolidated Fund, and it is provided that the aggregate amount of the salaries shall not exceed an Exchequer liability of£12,000 a year. The subsequent paragraphs of the Resolution relate to payments out of moneys provided by Parliament. Paragraph (2, a) of Part C authorises the payment of salaries and allowances of the staff of the Board, and the remuneration, salaries and allowances of members and staffs of the appeal tribunals. So far as the staff of the Board is concerned, the Bill provides, in Clause 37, that the Board may act either through its own officers or if, and as long as, there are arrangements for this purpose, through officers of the Ministry of Labour, or of the local authorities, for the purpose of investigating the circumstances of applicants for assistance.

Apart from any allowance for changes in the number of applicants, it is not expected that the new administration will necessarily mean an increase in the total numbers of staff engaged on the work of investigation. It should be remembered, however, that the local authorities took on a very considerable temporary staff to deal with transitional payments. The cost, I think, was something like£750,000 a year. That work will now be transferred to the Board. The Board, however, will have to appoint staff to carry out the statutory duties of determining the amount which is to be paid to applicants. Those duties are at present carried out by the public assistance Committees. There will, of course, be some reduction in the cost of administration by local authorities, but as they will still be responsible for the administration of other forms of relief, such as medical relief, it cannot be expected that the saving to the local authorities will be so large as the increase in the administrative costs of the Board.


Will the same personnel be transferred?


It may, or may not be. Paragraph (2, b) of Part C is that part which authorises the payment into the Unemployment Assistance Fund of Exchequer contributions to meet the cost of allowances to able-bodied persons between 16 and 65 years of age who are within the scope of the scheme. In addition to the Exchequer contribution, the local authorities will pay contributions based upon their expenditure during the standard year 1932-33 in respect of able-bodied persons who would have been within the scope of the new Board if the Bill had then been operative. The concluding part of the Resolution defines in detail how the annual local authority contributions to the Assistance Fund will be determined. The cost of the transferred services cannot be stated with any certainty, but a rough estimate of the cost for the whole country has been given in the Financial Memorandum.

Briefly, the proposal is, that out of an estimated expenditure of£6,500,000 by local authorities during the standard year 1932-33 on the classes of persons taken over by the Board, the local authorities will be relieved of 40 per cent., amounting to£2,600,000, and their normal annual contribution to the Assistance Fund will be£3,900,000. Furthermore, there is a special provision to safeguard the authorities against the possibility of excessive expenditure under Clauses 39 and 40 of the Bill. Clause 39, I might remind the Committee, enables the Board to determine that assistance to an applicant shall be given otherwise than in the form of a cash payment, or subject to conditions. Clause 40 provides for those cases in which by reason of his persistent misconduct an applicant cannot be regarded as an industrial worker within the scope of the scheme. I do not anticipate that the charges which will fall on local authorities through the operation of these necessary provisions will be considerable, but, at the special request of the local authorities, their liability has been limited and their position safeguarded.

Paragraph (2, c) of Part C of the Resolution is intended to cover all other items of direct expenditure out of the Assistance Fund, excluding the expenses of other Government Departments. It also gives the necessary authority for expenditure on training. So far as training is concerned, as I indicated in my speech the other day, there are necessary limits to the possibilities of training. The Board, no doubt, will approach this question cautiously and on an experimental basis. It is not possible to say with any degree of accuracy what the cost of training will eventually be, but it has been assumed that a sum of£750,000 may be spent by the Board in the first full year after arrangements have been completed. This, of course, is in addition to those sums now provided in the Votes of the Ministry of Labour for the current financial year, which were£448,000 for men and£81,600 for women. The last three lines of paragraph (2, c) refer to the reciprocal arrangements with Northern Ireland. This country has had a reciprocal arrangement with Northern Ireland for many years in the case of the Unemployment Insurance scheme. I am not yet in a position to say whether reciprocal arrangements with regard to assistance will be practicable or not, but this is a matter which can best be left to the Board, and Clause 55 gives the Board power to enter into reciprocal arrangements with the appropriate authority in' Northern Ireland if the Northern Ireland Parliament makes similar provision to that which is included in Part II of this Bill.

Then we come to the cost of administration. The present cost of administration of the transitional payments scheme is about£3,500,000 a year. Of this figure£750,000 represents the additional expenditure by local authorities in investigating the circumstances and determining the need of applicants for transitional payments. It was indicated in paragraph 18 of the Financial Memorandum accompanying the Bill that the additional cost of administration of the new scheme might be about£1,000,000, making the total cost of administration£4,500,000, on the basis of a level of unemployment of 2,500,000. This administration cost, it must be remembered, is in respect of an expenditure on allowances, etc., of over£50,000,000 a year.

I have endeavoured to deal fairly with the major part of the points raised by the Financial Resolution. There are one or two items the cost of which will be small. If any question is raised I can deal with each one of them in turn. There is an estimated annual saving to the Exchequer of£6,250,000 by the transfer from transitional payments to the Insurance Account of those persons who will qualify for an extension of the period of benefit beyond 26 weeks; but against this reduction in the charge on the Exchequer, which has been made possible by the improvement in employment, the Exchequer is assuming new liabilities. Under Part I of the Bill, those new liabilities, as I have indicated, include liabilities in respect of the provision of instruction centres for juveniles, a weekly contribution of 2d. in respect of the insurance of juveniles, and the liability that I have already explained arising on the discharge of men from the Forces. Under Part II of the Bill the Exchequer is assuming responsibility for the cost of the new scheme of assistance, subject to a fixed contribution from the local authorities, which has the effect of affording relief to the local authorities estimated at£2,600,000 a year.

The net result is that whereas the total Exchequer charge in respect of unemployment relief is now at the rate of about£75,000,000 a year, the rate of expenditure when this Bill becomes operative will be about£74,000,000 a year, without allowing for the possibility of the increased cost of assistance to which I have referred. These figures exclude the fact that it is estimated that a sum of£8,350,000 will be payable out of the Unemployment Fund in respect of additional benefits. That is in consequence of the operation of the ratio rule, which I explained the other day. I hope I have made clear what this Resolution does. I have endeavoured quite shortly to make the House conversant with the Resolution's purpose.

4.22 p.m.


It might be for the convenience of the Committee if I intimated now the course which it is proposed to adopt in regard to the Amendments on the Paper. The first two Amendments on the Paper, in the name of the hon. Member for Colchester (Mr. Lewis), I understand he does not propose to move. The next Amendment—in line 57, to leave out "the Consolidated Fund" and to insert "moneys provided by Parliament"—in the name of the hon. Member for Ebbw Vale (Mr. A. Bevan) and other hon. Members, is in order and will be called. The next two Amendments—in line 69 to leave out "together with annual local authority contributions," and in line 81 to leave out from the word "based" to the end of line 83, and to insert "upon such uniform scales as may be prescribed in the said Act,"—in the names respectively of the hon. and gallant Member for South-East Leeds (Major Milner) and the right hon. Member for Wakefield (Mr. Greenwood), are out of order as they would increase the charge.

4.24 p.m.


That decision raises a very important constitutional point. I quite understand that the result of transferring this burden from the local authorities to the State revenue would increase the charge, and that therefore, according to our traditions, that would be out of order; but this Financial Resolution differs in one essential respect from other similar Resolutions imposing a burden on local authorities. This money is not to be spent by local authorities on their own account, under the control of the appropriate Department, but is to be transferred from the local authorities to the State. In other words this is a new method for the State to raise revenue for Government purposes, a new method of imposing taxation. Therefore, it is depriving Parliament and this House of the right of controlling money that is spent by a State Department. I suggest to you, therefore, that there ought to be some way of preventing a Government Department getting round the traditional rights of this House by putting in a Resolution words which will prevent Parliament controlling the expenditure of money.


Before you answer, Mr. Chairman, I would further point out that the finance of the Bill was dependent upon some negotiations that were taking place between the Chancellor of the Exchequer and the local authorities. When we discussed the Second Reading of the Bill the final meeting between the Chancellor and the local authorities had not taken place, and this is the first real opportunity we have of discussing that important matter.


That is a question entirely apart from the question of order. Let me deal with the point of Order first. I do not quite understand the argument of the hon. Baronet. He seems to suggest that the effect of this Resolution will be to remove the expenditure of this money from the control of Parliament. I do not see how that question arises.


It would remove from Parliament the control of the method of raising the money. This money is to be raised by a new form of taxation and is to be spent by a Government Department. There is no precedent for it in other Financial Resolutions. There are many precedents for imposing new burdens on local authorities, to do work that they carry out, but no precedent for imposing a burden of this kind on local authorities, the money to be handed over to the State and spent by the State.


On that point of Order. This being a Measure for taxing local authorities, making them contribute to a certain fund, is it not in order for any Member of the House to move to reduce that taxation upon local authorities?


The question has received very careful consideration, and the short answer to it is that the only method that hon. Members can adopt in this particular case, to make the point the hon. and learned Member for East Bristol (Sir S. Cripps) suggests, is to oppose the Resolution. The Rule is perfectly clear, that no Amendment can be moved which would increase the charge set out in the Resolution, or go beyond the King's Recommendation as indicated in the Resolution. The effect of reducing these contributions would, of course, be to increase the balance that has to be provided by Parliament. That is the answer to all of these questions. The only way for hon. Members to deal with the matter is to vote against the Resolution.


I appreciate the difficulty of lack of precedent, but I submit that the proposal does impose a charge on His Majesty's subjects through local rates and Income Tax and in other ways and that the money is to be spent by the State. It is a new form of levying taxes on His Majesty's subjects.


May I submit that the effect of the Resolution is not so much to impose a new tax upon local authorities as to relieve local authorities of an existing burden?




I do not think that question arises now. As regards the point made by the hon. Baronet the Member for South-West Bethnal Green (Sir P. Harris) I think his contention is quite wrong. This cannot be said to be a Measure which is taxing the people. It is a question of the provision of certain money, on the condition that the local authorities contribute a certain part of it. The money which is to be provided by Parliament is only the balance over and above that provided by the local authorities.


Is there anything in the Standing Orders to prevent the Government reversing the position, that is to say, accepting the responsibility for 60 per cent. instead of 40 per cent., if they felt so inclined?


There is nothing in the Standing Orders to prevent the Government making any proposals to Parliament that they choose. The point here is that certain proposals are made which only the Government can make and the Committee cannot go beyond those proposals to the extent of increasing the charge. As regards the remaining Amendments on the Paper, there are two Amendments in the names of the hon. Member for Colchester and the hon. Member for Kingswinford (Mr. Todd)—in line 81, to leave out "their households" and to insert "such of their parents, children, brothers or sisters as may be living with them," and in line 82, to leave out "members of the household" and to insert "such parents, children, brothers or sisters." The first of these Amendments would be in order, but the second is definitely not in order. I imagine that the hon. Members concerned would not wish the first Amendment to be made, if they are unable to move the second Amendment.


I had hoped when these Amendments were put on the Paper that they could be taken together. As that is impossible and as you have indicated that the second Amendment is out of order, I do not desire to move the first Amendment.


The Amendment in the name of the hon. Member for East Birkenhead (Mr. White)—in line 82—to leave out from the first word "of" to the word "by" in line 83 and to insert "members of the household of the kind, and to the extent laid down"—is out of order on the same Ruling as that which I have already given.


I have attended some meetings in connection with this matter, and I have found hon. Members protesting against the terrible burdens on local authorities. Now we find them withdrawing all their Amendments.


I must ask the hon. Member not to interrupt me when I am dealing with the Amendments. The matter to which he refers does not arise now.


I shall wait for an appropriate occasion.


The Amendment in the names of the hon. Member for Gravesend (Mr. Albery) and the hon. and gallant Member for Gainsborough (Captain Crookshank)—in line 88 after the word "payments" to insert "and provide for compensation against accidents"—is the next with which I wish to deal. If that Amendment would have the effect of making possible an additional payment it would be out of order. If the hon. Members who have put it down contend that such would not be its effect, then this is not the place to move it. It should be moved as an Amendment to the provisions of the Bill. The next three Amendments—that in the name of the hon. and gallant Member for South East Leeds (Major Milner)—to leave out lines 100 to 132—that in the name of the hon. Member for West Fulham (Sir C. Cobb)—in line 100 to leave out from the word "means" to the end of the Motion, and to insert "such contributions as local authorities may be required by Part II of the said Act to make to the Unemployment Assistance Board"—and that in the name of the hon. Member for Chester-le-Street (Mr. Lawson)—in line 101 to leave out "three" and to insert "two"—are all out of order. Then we come to the Amendment in the names of the hon. Member for Walsall (Mr. Leckie) and the hon. Member for East Newcastle-on-Tyne (Sir R. Aske)—in line 104 to leave out "contribution of each council," and to insert "total amount of such contributions"—which is followed by a number of consequential Amendments. Subject to consideration of any representations which may be made to the contrary, that is an Amendment which I think will be in order. The Amendment in the name of the hon. Member for Normanton (Mr. T. Smith)—in line 106 to leave out "three-fifths" and to insert "one-tenth"—is out of order for the reasons already given.

4.37 p.m.


The Minister of Labour has striven to make this complicated Money Resolution as plain to the Committee as possible but in spite of his great efforts the Resolution contains so many principles and commits us to such large sums that hon. Members must have found some difficulty in appreciating what it meant. In connection with Part I of the Bill, we have a balance sheet in the Government Actuary's Report. We are told there that the contributions in the average year will bring in£61,600,000, and that the expenditure will be£43,500,000. Then as the right hon. Gentleman pointed out there is to be an expenditure of£8,350,000 in the cost of additional benefits under the Bill. Then there is a sum of£65,000 in respect of juveniles,£5,500,000 in respect of debt charge, and£4,100,000 administration expenses, leaving a balance of£85,000 out of the£61,600,000 of income.

When I first read the conditions laid down in this Money Resolution and in the Bill and saw that extra benefits were to be given to the people who were insured under Part I I thought to myself that this was a little bit of jam to be given to the insured contributor so as to play him off against the poor mortal who had to go into Part II and become subject to public assistance. But on further examination I discovered that the extra benefits which were to go to the contributor under Part I actually had the effect of giving the Exchequer the benefit of£6,250,000. One of the complaints that we have made—and the hon. Member for Ebbw Vale (Mr. A. Bevan) put the point the other night—is that this£6,250,000 will have the effect of relieving Part II of certain beneficiaries, if one may use that term as applied to those who come under Part II. The hon. Member for Ebbw Vale pointed out that the£6,250,000 was an actual saving to the Exchequer and that the payment of the£8,350,000 to new beneficiaries simply meant that if we passed this Resolution giving effect to Part I of the Bill we were saying to the contributors that any hope of a restoration of the cuts was doomed once and for all.

The right hon. Gentleman has said that there is nothing to prevent the Advisory Committee making a recommendation at such time as they think fit to increase the rate of benefit or to give equivalent value in other ways. If he thinks that there is a possibility of that, then, when he replies to-night, I think he ought to tell us definitely. We ought to know whether there is not really a direction to the Advisory Committee in the future to use the funds for Treasury purposes and to administer them in that direction rather than to recommend increases in the scale of payments or the restoration of cuts. The right hon. Gentleman says that the£6,250,000 is calculated as an annual saving for the Exchequer. It is not for this year alone; it is to be an annual saving and as there is only an estimated balance of£85,000 it is clear that there is no possibility now or in the future of the cuts being restored. We ought to face that fact. The Government clearly gave these people to understand that when the finances of the fund were in proper order there would be a restoration of the cuts. Under this direction there is no possibility of such restoration.

On an average of 2,500,000 unemployed the Advisory Committee has to balance the fund. It is clear that that committee, in the first place, will play for safety and will place considerable sums to reserve. Then there will be further transferences, if there is an improvement, of members from Part II to Part I which will be a saving to the Exchequer. Thirdly, I would say that probably there will be a reduction of premiums if there is an extra good year, which would allow them to consider such matters. If it is a case of not only making the fund solvent, but of easing the Exchequer to the extent of£6,250,000, then I think those under Part I can say farewell to any prospect of a restoration of the cuts. That it seems to me is one of the points which the Chancellor of the Exchequer ought to answer. The right hon. Gentleman stepped round it very daintily the other night. He said the Advisory Committee might do this or that or the other. He did not give any definite lead to the Advisory Committee on this question, and if it is desired that there shall be a recommendation to the committee to consider sympathetically the restoration of the cuts, I think we ought to have that stated definitely by the right hon. Gentleman to-day.

Part I requires that the fund is to bear the burden of the debt. The right hon. Gentleman thinks that the best way to make a fund solvent is to start it with about£115,000,000 of debt. I know that he and the Government hold that those who are members of this insurance fund and contributors to it should carry this debt, as it was incurred under the auspices of the insurance fund, but is it really just that one part of the industrial element of the country, the employers and the workers, that 12,000,000 out of at least 17,000,000 workers—because that is about the number there are in the professions as well as in industry—should bear a financial responsibility for that which is really a national responsibility? Surely there is no one in this House who can seriously argue that this£115,000,000 of debt was incurred by the members of this fund, and no one would, I think, deny that it was what has been well called an insurance against social disorder. It is very difficult, when one is dealing with the social and industrial conditions of to-day, to allocate what is due to the commercial and industrial conditions and what is due almost directly to the War, but I think it will be agreed that the greater part of the troubles through which we have been going are the result of causes which have very little to do directly with the industries that have to bear the weight of this debt.

We, therefore, say that this debt ought to be made a part of the National Debt and borne by the citizens of this country as a very light insurance against social disorders that have been avoided, and avoided so effectively that perhaps we in this country have suffered less than almost any country in Europe or in the world to-day. So it comes about that, as a result of placing that debt upon the fund and making the contributors to Part I bear the burden of that debt, for the next 40 years interest and sinking fund on£5,500,000 are to be paid annually. That simply means that there is another£ 5,500,000 added to the£8,350,000 that has to be paid extra, for which really the contributors to this fund have no direct responsibility and as a result of which they are going to be penalised from the point of view of the cuts.


I must call the hon. Member's attention to the effects of this Resolution with regard to the placing of this debt upon the fund. The placing of this debt upon the fund is not included in the Resolution. All that the Resolution does is to provide the machinery as to how the debt is to be paid if the fund is insufficient for the purpose, so that the hon. Member must confine his remarks to that and must not go into the general question of the advisability or otherwise of placing the loan upon the fund.


On a point of Order. Surely in discussing the Financial Resolution with regard to this Bill it is competent for Members to discuss the general financial position which arises under the Bill and which leads to the necessity for Parliament to contribute, either necessarily or hypothetically, in certain circumstances the moneys which are now being voted?


No. certainly not. That is very much too wide. The hon. and learned Member will realise that this is a Resolution for the purposes of certain expenditure, which is a mere incident. This is not a Bill founded on a Resolution. If it were, it would be entirely different, but it is certain that the discussion cannot range outside the limits of the Financial Resolution.


Further to that point of Order. Surely the second part of the Bill is entirely based on the Financial Resolution. The Bill could not have been brought forward at all without a Financial Resolution, and one cannot separate the two parts of the Bill. It is a single Bill which is before the House and which requires the Financial Resolution.


No. Certain parts of the Bill could quite well stand without any Financial Resolution at all.


I will not argue that point, but it seems to me that it is very important that this Debate should be as wide as possible. I gather that the Financial Resolution is to give effect to the provisions of the Bill, and therefore I take it that it will be in order for me to argue whether the£5,500,000 interest should be paid.


No. That is a charge upon the fund; that is not money which is provided by Parliament. The only thing which this Resolution authorises is the provision out of the Consolidated Fund of so much as the Insurance Fund is unable to pay.


On a point of Order. I would like to ask what is the Consolidated Fund?


That is not a point of Order, and it is not a question that I am called upon to answer.


On another point of Order. I would suggest that the Consolidated Fund is money found by Parliament, and it is the responsibility of the Government.


Our point of view is that this£5,500,000 annually ought to be provided by Parliament and, therefore, ought to be inside the Financial Resolution. It will limit us very much if we cannot argue the finance of the Bill in its broader and more general aspects. Suppose the right hon. Gentleman had to pay the£6,250,000 which is saved from the transference to Part I, and suppose the£8,350,000 in all which is being paid out of the fund had not to be paid for these extra benefits, then the Government could at once restore the cuts of 10 per cent. to the people who are contributors to Part I; and if the Government had accepted the responsibility for that£5,500,000 interest, they could not only have restored the cuts, but they could have reduced the contributions by 10 per cent., and, therefore, relieved industry as well as the workers who are contributors to the fund, and indeed they would have had something left to give extra benefits to the children. In these matters the right hon. Gentleman the Chancellor of the Exchequer can be very generous when he is dealing with people who are better placed than are the workers. When he is dealing with American and British shareholders or bondholders, he can treat it as a moral guarantee and a moral right which they have from the country, but when he is dealing with the workers, then, of course, he is insistent upon his legal rights.


I am afraid the hon. Member is getting outside my ruling.


Surely I am entitled to argue that this income to the fund which is made up of the contributions of the members of the fund might be reduced, or the benefits increased, if the Government were to take a certain course?


No. I do not think so, under this Resolution. The contributions to the fund are not mentioned in the Resolution at all.


On the point of Order. The Minister expressly mentioned all these matters in opening this Debate, in order to explain the financial position under this Resolution. Are other hon. Members not entitled to mention the matters dealt with by the Minister?


Yes, but there is a great deal of difference, as the hon. and iearned Member knows as well as anyone, between referring to a matter and arguing the advisability or otherwise of it.


Surely, if the Minister is entitled to refer to these matters in order to explain what the Resolution does, other hon. Members are entitled to refer to the same matters to explain what they think the Resolution ought to do, but does not, and, therefore, that they object to it and will vote against it?


Certainly they may refer to them to the extent to which the Minister did, but they must not go beyond that. I must rule quite definitely that the discussion of whether this debt should or should not be borne by the fund does not arise on this Resolution.


I do not intend to carry that matter any further. It seems to me that the finance upon which this Resolution is hased is very much in line with the finance generally of the Govevn- ment. When the right hon. Gentleman is dealing with bondholders he can be a sort of Santa Claus, even in summer time; but when dealing with the workers he is the legal business man, even at Christmas time. Let us say, at any rate, that as far as the first part of the Resolution is concerned, the Government are refusing to carry out a promise, and they are stereotyping the finance so that there is no hope of that promise being carried out. They are so juggling with finance that they will actually be the beneficiaries to the extent of£6,250,000, and it will be interesting when the Budget is introduced to see where that money goes. The last part of the Resolution, as the Resolution itself clearly says, is based upon the assumption that the householder has to bear the cost of those who are concerned, and there again we join issue with the Government. As a matter of fact, there are Members behind the Government who are using language just as strong as we use. The hon. Member for Sunderland (Mr. L. Thompson) gave an illustration of the working of the needs test which was just as effective as some of the speeches which we have been making to expose its application to the householder. Then the hon. and gallant Member for Clitheroe (Sir W. Brass) gave an outstanding illustration of the evil effect of the needs test when it was actually in operation.

We would not crumble and find so much fault if the Government were just when they apply the, principles of the needs test. They do not apply it to the people who in the last few years have received from the State£37,000,000 in respect of the beet-sugar subsidy. In regard to derating and in the case of the wheat subsidy, and other subsidies, no attempt is made to ask what are the needs of those who receive the money or to probe into the needs and household conditions of the beneficiaries. I have heard of people who have been surprised at receiving money under these subsidies, but the Government make no attempt to apply the needs test to them.

When it comes to the workers who, everyone admits, are, with very few exceptions, the unfortunate subjects of conditions over which they have no control, there has to be the probing of the surgeon's knife to find out exactly the conditions under which they live. In order to do it a great army of officials is to be set up. We were told the other night by a supporter of the Government that clouds of officials were to be set up in order to carry out the needs test. It will cost millions of pounds to set up a new bureaucracy to investigate the private conditions of people on a scale which has scarcely ever been dreamt of before, and which was done in only a very limited way when the old Poor Law was applied. Hon. Members who support the Government are beginning to feel this thing to be as irksome in their own areas as we who have complained about it from the first.

The Resolution is based upon the assumption that the needs test is to continue. It is to become a regular part of the social economy, and, as the Parliamentary Secretary to the Ministry of Labour told us, it is just a part of the whole scheme, a scheme which is based upon the best positions of the old Charity Organisation Society. If we have to meet the needs of the people who are struck by the exceptional conditions of industrial life in the 20th century, over which they have no control, and if we have to alter the method of dealing with them as compared with the method of previous years, at least the Government should have made some new social contribution to the problem. All that they can do, however, is to exacerbate conditions which are a century or two old, and to use the surgeon's knife in a much finer way in order to make the household bear a cost which legitimately should fall upon the Exchequer and the nation. We therefore take the opportunity of protesting against this particular form of Money Resolution dealing with the needs test.

I want to touch on the question of the local authorities. I do not know whether the right hon. Gentleman knows what is to be the financial result of his dealings with local authorities. I am certain, however, that the local authorities feel that they have been done down in this matter by the Chancellor of the Exchequer. The Government have allowed Members behind them to be under the impression that they were going to bear the whole financial responsibility for the people who are to be taken over under Part II of the Bill from the local authorities and they have allowed the local authorities to believe that they were going to take this course. I do not know how hon. Members in other parts of the House feel, but my hon. Friends on this side feel that they have a great grievance. Members of the Government for the last six months have been going about the area from which I come telling the local authorities that at last the Government were going to take over the whole of the unemployed and they have made very effective propaganda out of it. Indeed, the newspapers have had great headlines and special leaders about it, and everybody has been wonderfully encouraged by the impression that the Government were going to relieve the local authorities of this burden.

I want to know what the result financially will be. Take, for instance, an area such as I represent. The right hon. Gentleman gave Durham£94,000 out of the grant that was made, and everyone said it was wonderful. Will the Committee believe that that£94,000 was not equal to the annual cost of the extra people who have come on to the Poor Law since the Government came into office. It has been worked out accurately. The additional number of people who have come on to the Poor Law in the county of Durham in the last two years costs£2,000 a week, which is equal to£104,000 a year. I should like the Chancellor of the Exchequer to explain whether he is going to leave areas like that in their present position so that any contribution they may have will make no improvement in their conditions, while all the time they have a clear claim to assistance. Nobody has put that more distinctly and definitely than the right hon. Gentleman. They have a claim for extra consideration in view of the terrific burdens that have been laid upon them.

I shall be interested to-night to see where the northern group of Members will be in this matter. We were told that the northern group were behind the Government, but as far as I can gather, it is not a group at all; it is in pieces. They never did speak with full authority for that particular area. In view of his last meeting with the local authorities, the right hon. Gentleman ought to reconsider the position. Considering the conditions which the right hon. Gentleman laid down, I should say that the comparatively small amount, as far as the Government are concerned, but the large amount, as far as the local authorities are concerned, is not worth the trouble into which the right hon. Gentleman will get as the result of this niggling with the local authorities. It will certainly bring trouble to the Government's followers.

The right hon. Gentleman tried to explain to the House that it did not matter much about the Public Assistance Board being placed upon the Consolidated Fund. He said that there would be various opportunities for the House to deal with these matters. I wish he had been able to hear the speech of the hon. Member for Barrow-in-Furness (Sir J. Walker-Smith). Members of the Committee ought to read it, because that hon Member has had experience in the Ministry of Health, and he delivered a speech in language to which I could not possibly attain. He congratulated the draftsman who prescribed the constitution of this particular board in such grandiloquent terms and said: I forget the precise terms, but I know that they are to be a body corporate, with licence to hold land, and that they are to be appointed by warrant under the Sign Manual. That is all very gradiloquent, portentous, and ponderous, but it does not mean anything at all. I think it is designed for the purpose of deluding the public, and perhaps this House, into the belief that the body so appointed will be extremely independent above suspicion, beyond reproach, a body which can be relied upon to discharge its duties with extreme impartiality. For myself, I feel quite sure that it is mere camouflage for Government officials."—[OFFICIAL REPORT, 5th December, 1933; col. 1580, Vol. 283.] We think the Government have put this charge on the Consolidated Fund in order to keep these people out of controversy, so that they will not have to' answer for their sins, and in the long run it does not seem that the Minister himself will have many opportunities of answering. We say that this Financial Resolution, which is designed to give effect to a Bill affecting the lives of great masses of our fellow-citizens—it is said for many years to come; which involves a test which has borne hardly upon great masses of people and has been responsible for things which have shocked even Members of the Government; which, while purporting to put the fund into a solvent condition, leaves only a bare margin of£85,000 to work upon; and which visualises the possi- bility of the continuance of the present scale of benefit without any relief in respect of contributions ought not to have the support of the House. If those who have been in touch with local authorities within recent days, and it may be within recent hours, are really representative of their areas, then, whether they sit on this side of the House or on the other side, they will express themselves in the Lobby to-night with us against this Financial Resolution.


May I ask, Sir Dennis, whether you are allowing the general discussion now, and when the Amendments will be taken?


Certainly this is a general discussion, the question before the Committee being the adoption of the Resolution. Amendments will not be moved until they are called. I have already said that there are only two Amendments to be called. The first one stands in the name of the hon. Member for Ebbw Vale (Mr. A. Bevan) and relates to the Consolidated Fund. I rather gather that hon. Members whose names are down to that Amendment would prefer to discuss it in the general Debate, and, of course, it would be moved afterwards. The other Amendment, dealing with the question of contributions by the local authorities, will come later, but obviously that raises matters which can be largely discussed in the Debate on the Resolution itself.


Are we to understand that you suggest that those of us who have put down our names to the first Amendment will do better to discuss it in the general Debate, and that then the Amendment will be moved formally?


I must leave that to the convenience of hon. Members. I do not propose to attempt to shut out from this discussion anything which is covered by an Amendment. I think the only thing I can say, and I take it hon. Members will agree, is that if a Member makes a long speech devoted mainly to the question of the Consolidated Fund in the general discussion probably he will not be so likely to catch the Chairman's eye when the actual Amendment comes on.

5.20 p.m.


Your Ruling has, necessarily, also ruled out a good many of the things I wished to say, but perhaps it will be in order if I say that my chief regret is that this fund will be saddled for almost countless years with such an amount of debt that probably that fact will be made an excuse for not restoring the "cuts." But I will not follow up that point, because I should, no doubt, be told that I was out of order. I believe that if the House were perfectly free it would unanimously support many of the provisions of this Bill. To my mind, many of them are in the right direction. But when we come to the financial provisions—excepting those for the security 'and the solvency of the fund—I venture to say that if there were a free Vote of this House not 50 Members, except those of the Administration, would support them. The Chancellor of the Exchequer must be fully aware of the feeling of the country. In a series of rather remarkable negotiations, in which I have had some little part, he has been made aware of the feelings of every local authority from the South to the North. There was not only opposition but, I might almost say, bitter opposition to the financial arrangements in the Bill, and the Chancellor will admit that he can be under no misunderstanding as to the feeling, for some of the remarks were very blunt. There was not a single local authority that had not a criticism—and a severe criticism—to make of the suggestions in the Bill. I am old fashioned enough, however, to say that I oppose the Bill on three points of main principle.

Meanwhile, I hope the Chancellor may see his way to give us a little more. Already, I am willing to admit, we have obtained certain concessions, wrung out of the Chancellor at the last moment. I think he will almost admit that they were wrung out of him, because he felt that the moment was not propitious for standing out against what was evidently such a large body of public opinion. We have some concessions as regards those who are termed "discards"—a word I loathe. In respect of them the State will take over responsibility to the extent of 95 per cent. Why on earth they do not take 100 per cent. responsibility I cannot make out. As they have admitted so much in principle, it would have made it a more or less graceful concession. I cannot understand why they should haggle over 5 per cent.; it is disastrous to create so much irritation for the sake of 5 per cent.

The main principle to which I adhere is that the care of the able-bodied poor should be in the hands of the State, and be a national charge. The Government having gone as far as they have done, I cannot conceive why they have hesitated to take the plunge. It does look as though they had intended at one time to undertake a real reorganisation of the machinery for dealing with the unemployed. As a private Member who has never been in the Administration I do not, of course, know what goes on behind the scenes in Government Departments, and still less what happens in the sacred Department of Downing Street, but I can almost imagine that the Minister of Health, and possibly the Minister of Labour, were anxious to go a bit further, until brought up by the iron hand of the Chancellor of the Exchequer. They have spoiled a great opportunity of grappling with the whole question. I very much regret that the State has not taken the whole responsibility in its hands, seeing that the principle is no longer at stake. For better or worse, the principle has been recognised in this Bill. But if there is to be a charge, then every local authority, and I believe every Member of the House, believes that 60 per cent. is far too much to place upon the backs of local authorities already over-burdened and over-distressed.

As I understand it, the 60 per cent. is calculated on the amount for 1032-33, and is to remain the figure for three years. I know that some people think that period covers the peak point of unemployment, while others argue that it does not. For my purpose it does not very much matter which is the correct view. What I wish to point out is that in the next three years there may be great variations in unemployment, and yet, so far as I can see, the amount which the local authorities are to pay will be fixed. Should there be, as we all wish, a big fall in unemployment, will the local authorities still have to pay the same amount as they paid when there was a very large amount of unemployment? If so, it may mean that they will be paying in proportion a great deal more than they ever paid before. If what I have suggested proves to be a fact, I hope the Chancellor will at least give a guarantee that should unemployment fall during the next two years, he will at the end of that period repay the excess to the local authorities. That is not asking anything out of the ordinary, but only asking for common justice.

I will not go into the means test at the moment. I hold some unorthodox, and, it may even be, revolutionary ideas on the question of public assistance. Personally, I should be very glad to see all public assistance of every kind under one Department. I have always objected to the view that persons compelled to apply for Poor Law relief should be regarded as less deserving people than those who are unemployed. The case of a widow left with three children demands just as much sympathy as one would extend to that of an unemployed man, and why we should say that she and her family must take a step which is repellent to them and yet make provision for dealing with an unemployed man in another way is something I do not understand. I do not see why, in the matter of granting assistance, the State should make any difference between the widow and the invalid man and the man who is temporarily out of work. I know that this Government will not do it, and I do not know whether any Government will do it, but I should like to see all forms of public assistance put under one authority, so that there would be no line of demarcation between this person and that if they are in need of public assistance.

Another point on which I hold very strong views is the lack of control over expenditure. I have been somewhat disconcerted at the movements of the last few years. We are going to be ruled by a series of boards, and that does not at all suit my ideas. I am democratic enought to believe that even if democracy rule badly for a time it is preferable to let them rule badly rather than to set up an autocratic body. We have the Transport Board and the Milk Board and goodness knows what boards, and now we are going to have a Public Assistance Board. In the end it looks as though we here will have very little to do, and as though the public assistance committees will no longer meet. They will be an advisory committee. My experi- ence is that if you want to regulate expenditure, it is difficult enough under the old system when you have to pay for the services of people. People do not want the job, yet many of them work splendidly at it. Although they have worked splendidly, if they are invited to sit again they will now be told, "We will take advantage of your sitting there, and you may give advice, but you shall not have any control." If I were one of those people I should say, "No thank you. It was bad enough to sit when I had power, but to ask me to sit knowing that if I come to any decision I shall not have power to enforce it, means that I shall not take over this administration." You will find that people will be less and less inclined to sit on those boards when they have no power to enforce the result of their deliberations.

I still have a very great objection to money being taken from the ratepayers. I have never heard of a precedent for the rates being used for some service over which the ratepayers have no control whatever. We know that the State gives a subsidy through a local body, but that is not a parallel case, because the local body always has some representative who is subject to election by the people, who themselves are responsible for the administration, and there is a public department which has supervision over that. On the other hand, this seems to me very dangerous, and much more dangerous than the immediate consequences of the Bill, because it is restarting a system which this House has always resented when its own privileges were concerned. We are saying that the ratepayers shall pay an amount, which is to be handed to some form of State authority, of whom they will not even know the names, and consisting of five or six gentlemen who, a week after appointment, will be forgotten by the man-in-the-street, and will be inaccessible. The Minister will have to answer questions about the matter on every point, and I sympathise with him. It is bad enough to have to do it with regard to public assistance, and if every point of grievance is to be raised in this House, all the time, and a good deal more, will be occupied. The Minister may regret the step that he has taken, and the responsibility which has been thrust upon his shoulders.

Over and over again we have averred the right to exercise authority over money which has been granted, and we have no right to put upon the ratepayers a heavy burden of expenditure, without giving them a word to say about it. We are finding that a certain number of cases may be turned back from the public assistance authorities, not in consequence of the action of any local authority, but in consequence of the action of public assistance boards, and those people will have to pay for what someone else has had thrust upon them, as the result of the system. These are points of principle. If every hon. Member has gone, as he ought to have gone, to his constituents, and explained the Bill—if he understands it—he has a message to come back and vote against it. If he has not explained it yet, when he does explain it his constituents will explain what they think he has voted for. Apart from those questions, the main principle at stake is the vital responsibility of the local authority for the amount which, it has to raise. It has the right to supervise the expenditure, and to say, "This is our money, and we have a responsibility to the ratepayers to tell them where it has gone." Until that principle is restored, I shall vote against the Bill.

5.36 p.m.


The Financial Eesolution which is before the Committee seeks to make provision for a Measure which has been much too long delayed. We have had something like 20 years of industrial assurance, and we have had every opportunity to study its operation. We have just had the long and exhaustive deliberation, and the valuable Report, of the Royal Commission, to enable us to find a solution to many difficulties with which the State is confronted in this connection. The Bill is one which the whole House ought to welcome. I welcome particularly the financial provisions relating to benefits, and enabling the Insurance Fund to be placed upon a sound actuarial basis. I welcome also the provisions which enable those who have passed out of benefit to be separated from the Insurance Fund and to escape once and for all from the stigma of Poor Law relief. I welcome the provisions which enable us to deal in a more efficient fashion with juvenile unemployment.

I want to say, quite frankly, that the Bill, nevertheless, contains some very serious defects. After all the care, time and study which has been devoted to the preparation of the Bill, we were entitled to a better one. I desire to devote the time at my disposal to what I consider to be the most important matter, and that is the position of the local authorities. Before I pass to that, I will give the House my view, for what it is worth, on one or two of the other important points. You, Sir, have restricted the Debate, in so far as the question of the debt on the fund is concerned. The Minister has made reference to it, and the hon. and learned Gentleman the Member for East Bristol (Sir S. Cripps) drew from you the Ruling that the matter might be referred to, just as I have referred to it in these brief sentences. I merely want to say that I am one of those who are opposed to the Insurance Fund being saddled with this debt, and I hope that the Government will reconsider their decision in the matter. In so far as the application of the fund under the Financial Resolution is concerned, and the means test, I always have believed in the principle of the means test.


You are used to it.


I have done a good deal more, or at any rate as much as the hon. Member. I have always believed in the principle of the means test, but I have not always agreed with the manner of administering it. In view of the interruption I say quite bluntly that, so far as hon. Members of the official Opposition are concerned, the principle which they enunciate of distributing indiscriminate largesse out of the public funds is not one which is worthy of any sound Parliamentarian, and is totally unworthy of any great party which seeks to guide and direct the destinies of the greatest Empire in the world.

If the Chancellor of the Exchequer adheres to the percentage principle between the local authorities and the Exchequer, I understand that a certain year is to be called the "standard" year. That particular year is one of the worst through which the distressed areas had ever passed. In the event of the Chancellor adhering to this method of distributing the funds available, then, if things improve—I am happy to say that, thanks to the policy of the Government, they are improving, particularly in my part of the country—




I am grateful to the hon. Member for his interruption. It is an evidence of the fact that the county of Durham is better represented in this House than it has been for many years. We are improving, and the point to which I want to direct attention is that, as things improve, the amount which we shall have to contribute will not vary. It is a fixed contribution, and for two and a-half years we shall have to pay that, and as long as it remains stationary tbe contribution from the Exchequer will remain fixed. The proposal is so grossly unfair and so manifestly unjust, that I do not understand how it ever came to be considered. I do not see how it can be justified, and I sincerely hope that we shall hear from the Chancellor of the Exchequer, before this Debate closes, that he has reconsidered the point, and that the peak year, at all events, will be regarded as the average over a certain period.

Now I come to what I consider one of the most important parts of the financial provisions of the Bill. It is the part which is causing great controversy, and which is giving to those of us who represent distressed areas the greatest cause for anxiety and apprehension. In the course of the speech which the Chancellor of the Exchequer delivered on 4th December, he said: I am rather astonished at the charge which is made in the Liberal Amendment and which was repeated by the hon. Member for East Birkenhead when he said that the Government had given a pledge which had not been carried out. I challenge any hon. Member to name or to point to any pledge which has been given in this respect by any Member of the Government which has not been more than carried out by what we have put into this Bill." An hon. Member interjected here: The Minister of Health." The Chancellor of the Exchequer then went on: I do not want to read again the quotation, but what the Minister of Health said on 12th April has generally only been partly quoted."— That is the reason why I am quoting the Chancellor of the Exchequer in full. I do not want to leave myself open to the charge that I am only partly quoting him. He went on: Hon. Members have taken out a particular part of the quotation which suited the interpretation they wished to put upon it, and have dropped out the qualifying words. If the whole passage be read it will be seen that what the Minister of Health had in mind was that the local authorities should make a contribution towards the cost of which they had been relieved, but there would be a rebate to them which would be devoted to the distressed areas in particular."—[OFFICIAL REPORT, 4th December, 1932; cols. 1359-60, Vol. 283.] In the Debate on 12th April, to which reference has been made, the Amendment which was accepted by the Government, and was embodied in the subsequent Resolution, was tabled by the Members of the Northern group. It was moved by the senior Member for Sunderland (Mr. Thompson) and seconded by the Member for East Newcastle (Sir R. Aske), and it was: That this House resolves that responsibility for assistance to all able-bodied unemployed not over 65 years of age should be accepted by the Government, with such readjustment in financial relations between Exchequer and local authorities as is reasonable, having special regard to the necessities of distressed areas. In accepting that Resolution on behalf of the Government the Minister of Health used the words referred to by the Chancellor of the Exchequer. The Chancellor of the Exchequer said that they were not quoted in full, and I want to avoid that suggestion, so I will quote the exact words which the Minister of Health used on 12th April. I hope the Committee will forgive me for troubling it with these long quotations, but this is a matter of vital importance, particularly to local authorities, and that is why I am bringing it forward. The Minister of Health said: 'The Bill will establish such a measure of control. In particular, it will re-distribute and define the functions of local authorities and the central government in relation to assistance from public funds, whether the funds of local authorities or the funds of the Exchequer. One of the bases of this redistribution of responsibility between local authorities and the central Government will be that the central Government shall accept responsibility, both administrative and financial, for assisting all the able-bodied unemployed who need assistance. The acceptance of this responsibility by the central Government will necessitate a readjustment of the present block grant paid to the local authorities by the State, since they will be relieved of a liability to which they have hitherto been subject. At the same time, we shall take the occasion of these financial readjustments to make some allowance on a regular basis for the special necessities of what are commonly described in this connection as the distressed areas. In the embarrassing wealth of Amendments to this Motion, I find it difficult to give a prize among so many, but the Amendment that has been put down in the name of my hon. Friend the Member for Sunderland (Mr. Thompson) appears to the Government to be in accordance with these principles to which I have referred, and the Government propose to accept it."—[OFFICIAL REPORT, 12th April, 1933; col. 2607, Vol. 276.] My hon. Friend the Member for Sunderland, who was our spokesman, revealed at once that he was under no misapprehension as to the full significance of the announcement that had been made by the Minister, for, in moving his Amendment, he said: As has been revealed to us to-day, the problem is involved and difficult, and I am satisfied that, owing to a great extent to the fact that we have been assured by the acceptance of the Government of the main issue, the able-bodied unemployed will be taken over by the State and the cost of their maintenance discharged by the State. Then, after a little of what the Foreign Secretary, in a recent Debate called the "rough and tumble" of Debate, between my hon. Friend and Members of the Opposition, he went on to say, referring to his Amendment: I divide it into two parts. The first part asks the Government to recognise a great principle—the principle of making the able-bodied unemployed a national charge. Some hon. Members have said that the second part is rather ambiguous, but, after the statement of the Minister, that ambiguity will be largely if not entirely removed. This great principle, for which many of us have stood and fought for years, has been affirmed. … once it is accepted we shall have surmounted the first hurdle."—[OFFICIAL REPORT, 12th April, 1933; cols. 2637-42, Vol. 276. The hon. Member for Newcastle, East, in seconding the Amendment, expressed his gratitude to the Government for their acceptance of the principle, and contented himself with emulating Oliver Twist and asking for more. He was not quite satisfied, and asked that the block grant formula should be altered for the current year in the interests of the distressed areas. I am not going to weary the House with additional quotations, but I have been through the whole Debate. The hon. Member for Birkenhead, East (Mr. White), who followed the Minister of Health, at once indicated that he was glad that the whole responsibility, both financial and administrative, for the maintenance of the able-bodied unemployed had been accepted by the Government. The hon. Member for Middlesbrough, West (Mr. K. Griffith), who also spoke in the Debate, asked a very pertinent question, and had that question been answered then a good deal of the trouble would have been prevented. The hon. Member for Winchester (Sir G. Ellis), who does not represent a distressed area, indicated in the same Debate that he accepted the principle, and assumed that the Government accepted the principle, of the maintenance of the able-bodied unemployed as a national charge, and other Members for constituencies in distressed areas followed suit. They thanked the Government for the acceptance of the principle, and one after another congratulated the Government on their courage and wisdom in doing what Government after Government had not even endeavoured to do, including two Socialist Governments, although they had been preaching it for years. The hon. Member for North Salford (Mr. J. P. Morris), who was partially responsible for bringing this question to the fore, waxed almost lyrical. He said that it would be considered by posterity as a milestone on the road to better Government, both nationally and locally. The hon. Member for Barnsley (Mr. Soper) also spoke in a similar sense, as did my hon. Friend the Member for Durham City (Mr. McKeag).

The Debate was wound up by the Solicitor-General, in a speech lasting a quarter of an hour—a perfect masterpiece of the art of being able to speak without saying anything. He told us nothing. He did not answer the vital question asked by the hon. Member for Middlesbrough, West; he said that the answer was to be found in three classic monosyllables, and we were left wondering whether we should live in hope, or whether we should watch and pray, or whether we should wait and see. We waited patiently, and now we are seeing. The curtain has been drawn aside, and, frankly, we are not very pleased with the picture. I would remind the Committee that, while a great deal of attention has been paid to the Debate which took place on 12th April, practically nothing has been said about a subsequent Debate which took place in the House, except that some slight reference was made to it by the hon. Member for Chester-le-Street (Mr. Lawson). That was the Debate which took place on the 6th July, in the course of which the Minister of Health laid before the House his proposals for bringing some measure of temporary relief to the distressed areas. On that occasion the Minister confined himself to dealing with the temporary provisions, so that, so far as the present Debate is concerned, there is no call for any comment on his speech. Other Members, however, were gravely concerned and deeply alarmed as to the future, so far as local authorities were concerned, in relation to the long-term proposals. Reference was made to the long-term proposals by, among others, the hon. Member for Richmond (Sir W. Ray), who is regarded as being one of the greatest authorities in the House on local government, who is one of the leading members of the London County Council, and who was the leader of the deputation which went to interview the Government on the occasion when the question of the distressed areas was first under discussion. The hon. Member for Richmond made a very valuable contribution to the Debate of 6th July, which drew from the Parliamentary Secretary to the Ministry of Health this very striking tribute: The hon. Member for Richmond gave an accurate picture of what happened when he led the deputation to my right hon. Friend, and I am glad that he did. I took down his words. He said that the deputation represented all the leading associations of local authorities, and that, while they had the utmost sympathy with distressed areas, they differed on a point of principle which he proceeded to elaborate."—[OFFICIAL REPORT, 6th July, 1933; cols. 621-2, Vol. 280.] The Parliamentary Secretary said that the hon. Member for Richmond had given an accurate picture. Let us see what the hon. Member for Richmond actually said, for I think it will be of great interest to the House. Attacking the right hon. Gentleman the Member for Wakefield (Mr. Greenwood), a former Minister of Health, he said: I think the right hon. Gentleman is guilty of very extreme exaggeration in endeavouring to show that the authorities which met the Minister of Health were in any way antagonistic to the suggestion that something should be done for the distressed areas. It was not even a selfish policy on our part, because we would have been prepared, and we have been prepared for years, to see that the burden of the cost of the able-bodied unemployed in this country should be a national charge. The only difference about it is that we who believe in a policy have got His Majesty's Government to adopt it, whereas the party of which the right hon. Gentleman is a leading Member have always stood up and advocated a policy when they have not been in office, but have never put it into effect during the time that they were in office. That is the only difference, so far as I can see, on the question of the able-bodied unemployed being made a national charge. A little later the hon. Member for Richmond added this: I only wish to say that the policy to be taken up by His Majesty's Government in the autumn of the maintenance from public funds of the able-bodied unemployed was never the monopoly of hon. Gentlemen opposite."—[OFFICIAL KRPOKT, 6th July, 1933; cols. 540-4, Vol. 280.] The hon. Member for Richmond was succeeded by the hon. Member for Consett. I failed to catch the Speaker's eye in the previous Debate, but on this occasion was fortunate enough to do so, and, like other Members, all supporters of the National Government, I congratulated them on their bold and courageous policy. I then went on to say this: More than anything, I want to thank the Government for the acceptance of the principle that the maintenance of the able-bodied unemployed is a financial burden that ought to be borne by the State as a whole, not by those areas which through no fault of their own are feeling most severely the effects of the trade depression. Then I came to the point which is causing so much controversy and resentment to-day, although I am afraid that some hon. Members opposite are inclined to treat this very serious matter with levity. I said: I should like to ask the Minister to give his particular attention to this point. The right hon. Gentleman gave us all to understand that the Government accepted responsibility for the maintenance of all able-bodied unemployed, that they would make the whole of it a national charge, and that the local authorities would be relieved entirely of that burden. The Minister of Health intervened at that point and quoted the passage Which has been quoted so frequently: The acceptance of this responsibility by the central Government will necessitate a readjustment of the present block grant paid to the local authorities by the State, since they will be relieved of a liability to which they have hitherto been subject. I then went on to say that I was about to quote that very passage, because on that very day there had been a leading article in the "Times" which threw doubt, for the first time, on the question whether His Majesty's Government were prepared to accept the full responsibility.


May we have that quotation from the "Times"?


I went on to say: That last phrase, as I read it, is a definite undertaking that, following on this temporary expedient, the Government would proceed to implement that undertaking and make the charge of the able-bodied unemployed a national, not a local one."—[OFFICIAL REPORT, 6th July, 1933; cols. 559-60, Vol. 280.]


Is that the "Times"?


No. that is a sounder view than the "Times." It is my own. The Debate was wound up by the Parliamentary Secretary to the Ministry of Health. I got no more satisfactory reply to my query, definite and categorical as it was, than the hon. Member for West Middlesbrough got to his. The Solicitor-General fell back on "Wait and See." The Parliamentary Secretary to the Ministry of Health fell back on the famous phrase used by the father of the Chancellor of the Exchequer, "What I have said I have said." He said that what the Minister of Health had said he meant.

That brings us to the crux of the question. We know that, whatever he meant, he did not mean what we meant, and he did not mean what we thought he meant. I am quite prepared to admit that nowhere throughout the whole of the Debate can it be found that any responsible Member of the Government ever, in those words, said the Government would accept full financial and administrative responsibility for the whole of the able-bodied unemployed over the whole of the country, but there is not the slightest doubt that the impression left upon the minds of all the supporters of the Government, and in other quarters of the House, was that the Government were prepared to make this a national charge and to accept full responsibility for maintaining all the able-bodied unemployed, expecting that in return the local authorities would relinquish control over funds towards which they had not contributed because they were being relieved of a liability to which they had hitherto been subject. From what has happened, it is clear that this was not only the impression of Members of the House but also of local authorities. Our interpretation was right in one respect. Local authorities are not to have any voice in the control of the fund. They are to contribute but to have no say as to how the money is being spent. The Minister of Health in all his speeches and in all his negotiations and interviews laid it down emphatically that, if the money was to be contributed by the central authority, the fund must be administered by the central authority. The principle, apparently, was sacrosanct when it was a principle in which the Government were involved, but it ceased to have that value or validity once it became a question of the boot being on the other foot.

We agreed that it is quite right to leave the administration to the central authority, because we believed that they were supplying the whole of the money. All this time we had believed this. It is only now, on the introduction of the Bill, that we are told that this is not the case, and we are actually left guessing how much we are to receive. We agree that some redistribution of the block grant is essential, and we want to know exactly what is to happen in view of the concluding words of the Resolution accepted by the Government, "having special regard to the necessities of the distressed areas." The Chancellor of the Exchequer says that the Government are doing more for the local authorities by the sum of£1,100,000 than the Government had in mind at the time the Minister of Health made his speech. If£1,500,000 was the sum: total which the Government had in mind in April to devote to the necessities of the distressed areas, why were we not told so then? It was believed that the amount was inadequate. We are now told it is to be increased to£2,600,000, and because of that we have no right to complain that we have been unfairly treated or have not got what we were led to expect. We have discussed the matter time and again on the Floor of the House, upstairs and in our constituencies and there is not one of us who has ever regarded £1,500,000, or even£2,500,000, as being anything like adequate to meet the case. Nothing short of national responsibility for what we have believed always to be a national charge will satisfy us or will fairly meet the case.

The right hon. Gentleman supports his case by reference to the De-rating Act, 1929, his own Act of Parliament. He says. I should like to remind the House, because this is another of the inaccuracies of the right hon. Gentleman the Member for Wakefield, that the block grant under the Act of 1929 was so designed as to give special assistance to those very areas which are known as distressed areas."—[OFFICIAL REPORT, 4th December, 1933; col. 1362, Vol. 283.] Surely the right hon. Gentleman must be aware that in a county like Durham the benefit derived from the De-rating Act has absolutely and completely disappeared, washed out by the tremendous growth in Poor Law expenditure. Since the operation of the Act, it has increased by no less than£400,000 per annum. The total in Durham for that one service only is no less than£1,392,000, equivalent to a rate of 9s. 2d. in the£. The Chancellor says that necessitous areas have gained by putting the block grant at an average figure, but I cannot see that there is any validity in the argument. Surrey and Durham are almost the same size and have almost the same population. A penny rate in Surrey produces£37,400. It produces only£11,800 in Durham. A 4s. 9d. rate in Surrey would produce over£2,000,000 and in Durham only£770,000. The 11s. 1d. rate which the Chancellor quotes for Durham County produces only£1,570,000, or£500,000 less than a 4s. 9d. rate produces in Surrey. The De-rating Act conferred an enormous benefit upon industry. I should be the last in the world to deny that. But the period of its operation has coincided with a period of very deep depression. We depend largely in Durham on the mining industry. Dozens of our pits have closed. There are 40,000 more miners unemployed than there were only a few years ago. The number has doubled during the period of the operation of the De-rating Act. Durham also is one of the counties whose rateable value has not increased. It has slightly decreased. Because the collieries are closed, we lose our rateable value, and we lose a portion of the Exchequer grant. From that cause alone, we lost in one year no less than£140,000, the equivalent of a 1s. rate. On top of this, of the£1,139,000 Poor Law relief no less than£234,000 is for the relief of the able-bodied poor, equivalent to a rate of 1s.7½ d. in the£. The gain from the Derating Act has been absorbed entirely by increased Poor Law relief, and just about balances the amount spent on the relief of the able-bodied unemployed.

If you add the loss in rateable value to the other figure, it means that we are actually worse off, because the rateable value of Durham is, roughly speaking, only about half that of England and Wales. Industries have benefited under the De-rating Act, but the burden has been transferred to the shoulders of the householder, the tradesman and the shopkeeper. Contributions from the Exchequer have not been enough to cope with the rising tide of Poor Law relief. In view of all this, I contend that the argument from the average has no validity and carries no weight. I think it is against the spirit of the Act itself. It is no fault of ours that our people are out of work. I have always held that the responsibility for the unemployed is a national charge. I am unable to follow the argument of the Chancellor that the Exchequer is contributing 95 per cent. and the local authorities only five, but, if that is so, he has a golden opportunity for a comparatively small sum to give a great deal of relief to the distressed areas; and he can stop the bickering that is going on between what are called distressed areas and what are called prosperous areas. He would be doing not only what the country expects him to do, but what the great majority of the Members of the House think he ought to do.

I ask the Government, even at this late hour, to reconsider this legislation, not only for the reasons that I have stated, but also because this not the end. We cannot indefinitely go on paying money out to 40,000 miners in Durham and getting absolutely nothing in return. The Chancellor confessed four years ago that he was baffled by the problem of areas like Durham and Glamorgan, yet we go on discussing day after day unemployment and the relief of unemployment when we ought to be discussing employment and the means of finding work. I urge the Government to meet us in the matter and to get this question out of the way and, when they have done that, to utilise to the full the power, the energy and the resource of the National Government towards bringing about that transference of labour and that redistribution of population which will kill for ever the term "distressed areas," and bring our industrial and economic life more into line with modern needs and modern conditions.

6.15 p.m.


The hon. Member for Consett (Mr. Dickie) has covered such a wide field, and given such an extensive review, that it has relieved me of the necessity of saying a good deal of what I contemplated. My name has been so much associated with the Resolution of 12th April last and the reply given by the Minister of Health that, at the outset, I wish to dissociate myself from those for whom I have had the privilege of speaking both in the deputation to the Chancellor of the Exchequer and elsewhere in regard to the charge of broken pledges. There can be no such charge laid against the Government by those who understand the position or who intelligently try to understand it. When I moved the Motion I was under no misapprehension as to its meaning, and when I heard the reply of the Minister of Health I was under no misapprehension whatever. I will tell the Committee what was in my mind when I moved it. I saw two difficulties, one relating to the block grants and the other to the number of men who would be taken from Poor Law relief and transferred to the Assistance Board. It was clear to me that the block grant given under the Act which has just been quoted for the relief of distressed areas was really weighted through unemployment.

Here we have under consideration, not the whole incidence of unemployment, but a partial incidence. It was apparent to me that there would be great difficulty in the mind of the Government to relate the partial incidence of the able-bodied unemployed with the full weight of block grants due to unemployment in the area. That was the difficulty in my mind. I appreciate the position of the Government to-day. They have said that the difficulty is great, and that they cannot deal with it, but they are attempting to adjust it through another means which consists of a contribution from the local authorities and from themselves. The whole point is whether the contribution is a reasonable one or not. I will be frank and say that, if I had been the Chancellor of the Exchequer, I think I could have made out a very good case for any block grant which the municipality would get. I take a different view as to the present position. I think that, on the whole, the present position is not reasonable, having due regard to all the circumstances, and that eventually the Government will get the best of it. It was mentioned by an hon. Member opposite that the grant would be for a period of 2½ years. It is true that for every man put into employment the Government will be relieved of 100 per cent. of its contribution to the Assistance Board in respect of that man, or, in the interval, of transitional payment.

It is also true, in my opinion, that the present charge for the standard year of 1933 is reasonable. I have heard it argued to-day that the year should be 1931-32 instead of 1932-1933. The Chancellor of the Exchequer has a right to say, "Why not this year?" and if that had been the case undoubtedly the charge would have been higher. I freely admit the fact, but that does not vitiate the position. I believe that during the period of 2½ years there will be a definite advantage and diminution in unemployment, and that at the end the Government will be a great gainer. I, therefore, make an appeal on behalf of all the distressed areas that the Government might reasonably reconsider the position which they have taken up in regard to the 60-40 arrangement. During my commercial experience I have dealt many times with horse-dealers, many of whom were highly respectable characters, and I have obtained bargains. I do not quite feel in the same position to-day, because I am dealing with a reasonable Chancellor of the Exchequer who sees all the circumstances of the case. If I were trying to make a bargain, I might say that the 60-40 arrangement should be reversed. But if he were to say to me, "I believe your arguments are right and we will split the difference and make it 60-50" and so give another 10 per cent. to the distressed areas, it would be helpful.


While appreciating the confidence of the hon. Member in the Chancellor of the Exchequer on this matter, I would ask him to suggest how, in view of the Resolution we are considering at present, it would be possible for the Chancellor of the Exchequer to alter his decision, and how we could have the Resolution altered without actually voting against it?


I am not going to attempt to determine, what I am sure the Chancellor of the Exchequer will be capable of doing, but I would suggest that as late as two months ago, in September, the position was realised, and it is based upon the reply of the Minister of Health, when he said: To make some allowance on a regular basis for the special necessities of what are commonly described in this connection as the distressed areas."—[OFFICIAL REPORT, 12th April, 1933; col. 2607, Vol. 276.] We believe that there are other necessities, and that there is nothing to prevent a special grant to the distressed areas from continuing. We who are associated with the Government and are backing them in every conceivable circumstances, and have stood by them in the many misrepresentations which have been made in recent days regarding the financial proposal, believe, in spite of these misunderstandings, that a case could be made out for the distressed areas. I would make a passionate appeal to the Chancellor of the Exchequer, that if he can in his wisdom reconsider this Financial Resolution and give some extra relief to the necessitous areas, it will be received, not only as a real gesture, but, I believe, will give great satisfaction to the areas which we represent.

6.25 p.m.


We have listened to two extremely well-informed speeches on the part of hon. Members who have put the case for distressed areas. In the course of putting that case, they advocated principles with which we on this side wholeheartedly agree. I do not think that there would be any dispute between us as to the principle that the able-bodied poor should be a charge entirely borne by the National Exchequer. We are at one with them in the case which they put for the depressed areas. I understand that those two hon. Members have given the Northern view in this matter. I ask them whether they will come into the Lobby with us to-night and make this the test of their sincerity? Is the hon. Member for Sunderland (Mr. Thompson) so passionate to-night that he is prepared to walk into the Lobby against what he considers to be the unjust treatment of the distressed areas?


I am passionate enough to support the Government in order to help to put through one of the best Bills on unemployment insurance which has ever been seen in this House.


After that remark, I should like to ask where is the sincerity and the passion; where is the feeling for the depressed areas? If this is the best Bill which has been brought forward dealing with this subject, what is the point of the criticisms to which we have just listened? I can only see one way—I do not know whether there is any other—whereby they themselves can give us help in regard to the proposals of the Financial Resolution, and that is by walking into the Lobby against the Government. My hon. Friend was right, I should imagine, when he said that there is only one way in which the Government can meet them to-night, and that is to withdraw the Financial Resolution. But the Chancellor of the Exchequer, who, I gathered from the Press, told the local authorities not to waste his time, is not going to make himself so silly as to withdraw this Resolution. Therefore hon. Members have to make up their minds to-night, if they are to support the depressed areas in their claims, to vote against the Government who are inflicting injustice upon the depressed areas and against whom they have so eloquently argued in the course of this Debate.

I want to address myself to the provision with regard to the juvenile instruction centres which, I understand from the Financial Resolution and from the speech of the Minister this afternoon, is to be dealt with here. As I understand the position, it represents the contribution of the Government to one of the most tragic problems with which we had to face. At the moment we have about 100,000 juveniles, although the figures cannot acourately be ascertained, from 14 to 18, unemployed, and we learn that in the next two or three years that figure will mount higher and higher. We shall get from 200,000 to 300,000 children unemployed during that period. The Govern- merit come forward and say: "This is our way of dealing with the matter," and they are making provision to finance the juvenile instruction centres in three ways, in the first instance by contributions from-the local authorities, a contribution which, I gather from the figures given by the Minister, will amount to£280,000 in the first year. That is a most unjust way of dealing with the matter. Since this is provision for unemployed children, it ought to be borne entirely by the national Exchequer, but the bulk of the money will be found by the very areas which are least able to bear it, the depressed areas, because it will be in those areas that we shall have the greatest number of unemployed children.

The Chancellor of the Exchequer the other day was very proud of the contribution that the Government were making towards meeting this problem. I think he said that£425,000 would come from the Government and£425,000 from the fund. That fund is made up of contributions by the employers, the State and the children. Am I not right therefore in saying that the twopences of the children per week will finance the juvenile instruction centres, at least to a partial degree? That is a wrong principle. The insurance fund ought not to bear a single penny of the cost for the juvenile instruction centres. The whole cost of the centres ought to be borne by the national Exchequer. We have heard of fees in secondary schools, but here we are going to charge fees for juvenile instruction centres. The boys and girls who are unemployed will have to pay towards their own education in that respect.

If I am wrong in what I am about to say, the Chancellor of the Exchequer will correct me. I notice that with regard to his balance sheet he said that we have an income of£760,000 and that there will be an expenditure of£860,000 and therefore a burden will be thrown upon the Exchequer.

The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain)

Upon the unemployment fund.


The£760,000 is a calculation of the income to the fund from the children of 14 to 16 years of age, but included in that expenditure is the expenditure on the instruction of these youths from 14 to 18 years of age. If we subtract the amount that it is going to cost for the junior instruction centres for these young folks from the age of 16 to the age of 18, it can be reasonably said that the amount of the contribution towards the unemployment fund will go to pay for the juvenile instruction centres and that will come out of the fund itself, instead of out of the taxes of the country. How can the Minister justify the contribution from the children of 2d. per week going into the insurance fund if they are not to benefit in the main? I know that a certain sum will go to the child as a dependant if the father is unemployed and the child is unemployed, but if the child itself is unemployed there is no insurance benefit. On what basis of insurance can this be justified? Why are they made to pay into the Insurance Fund and then during the period from 14 to 16 years not be allowed to have any insurance benefit when they are unemployed.

I have heard it stated many times that to pay unemployment benefit to young people of 14 to 16 years of age will be to demoralise them, and that if we give them one or two shillings a week we are taking a step on the downward road to the demoralisation of the youth of our country. I am one of those who do not accept that argument. I am strongly of the belief that the greatest factor in the demoralisation of these young people is their poverty, their lack of income. If the Minister is going to do the best thing for these youngsters, then those who are unemployed ought as a right out of the Insurance Fund to have insurance benefit paid to them. No one will hear me decry the sort of salvage work carried on by the juvenile instruction centres, but as a contribution to the social, industrial and educational needs of the country they are inadequate. This policy is entirely inadequate. I have been talking to a large number of people who have been engaged in juvenile instruction centres, and I find that it is impossible for them to plan anything far ahead in the curricula of the centres. It is impossible, in the main, to relate the courses of instruction given to even the major needs of industry. The children are in and out. The personnel of the centres changes every five weeks. Some boys are in to-day and gone to-morrow. They may go into a centre on the Monday morning, get a job on the Tuesday, and I presume they can then leave the centre on getting the job. Here is provision for the expenditure of money on courses of instruction of an intermittent nature. Unless the Minister is prepared to go very much further the money will be very largely wasted from the social and educational point of view.

If it is impossible to plan far ahead a course for the individual students in those centres, how much more difficult is it to plan far ahead for the needs of the nation? There can be no planning of a national character relating to the needs of the children in the depressed areas who are out of work by tens of thousands, and the demands that may be made in those areas where there are new industries growing or enlarging. It is no compensation to say that in the London area there are large numbers of children out of work. That is no compensation for the hundreds of thousands of children in the depressed areas who will be out of work. How can you erect centres in the mining areas and in the cotton areas which will be of real advantage to the children in any industry in those areas? When the children have been trained for a short period in those areas where are the outlets for them?

From the figures which were given to me the other day it is estimated that the total cost in the first year for the juvenile instruction centres will be somewhere in the vicinity of£1,300,000, and it was estimated that in the first year about 100,000 students would attend the centres. That is a very big job. At the moment there are about 20,000 in attendance, but in the first year of the operation of the Act for which we are finding the money to-day there will be a jump of five times in the number of students attending the juvenile instruction centres. Does the Minister say that he can meet that situation? Are we going to see an expansion of the juvenile instruction centres from an attendance of about 20,000 students to about 100,000? Where are the buildings to be got? Is the Minister going to use the old, disused factories or workshops? If the cost is to be£1,300,000 for 100,000 students it will amount to£13 per head. How much provision is made in that sum for capital expenditure? Compare that with the cost for the education of ele- mentary school children. It costs£13 per head to educate an elementary school child, but in that£13, there is no provision for the capital expenditure of the denominational schools. If we put the£13 per head envisaged in these figures for juvenile instruction centres against the cost of£13 per head under the ordinary elementary school system, it is easy to see how inadequate the provision is. You cannot erect any new buildings out of the sums mentioned and still provide places for 100,000 children.

The education will be, in the main, practical education. Hon. Members opposite are always keen on practical education being given. Practical education is much more costly than the other type of education, and if these children are to get an education which is going to be of any practical value to them in re-entering the industrial field then£13 per head will be totally inadequate to do it. Is the Minister going to send these children to the ordinary schools of the country? I saw the other day a remark by the chairman of one of the Scottish education committees in which he said that it was absurd and ridiculous to do what is proposed. He said that if places are provided for the children by the Minister of Labour there will be empty places in the ordinary schools, and that if we are going to spend this money we shall be depleting the places provided within the ordinary educational system.

I should like to ask one or two questions of the Minister. The Bill makes provision for crediting children, if they attend the ordinary schools of this country instead of going to work, with 20 stamps for two years, 15 for 18 months, and 10 stamps for 12 months. Will children who go to special schools be credited in the same way? Will those who go to secondary schools be credited; and will children who live in areas where the school age has been raised by law, and are compelled to attend school compulsorily, also be credited? It will work unjustly on those children who go to school in areas where they are compelled to go by law and on those who go to secondary schools if they are not to get the small amount of credit which accrues to other children. I shall follow this point up in Committee if I have an opportunity.

In my judgment, the effort of the Minister will not meet the situation at all. The junior instruction centres are not an adequate contribution to the problem. As a matter of fact, a number of people who at first welcomed this scheme are now becoming suspicious and antagonistic. There is a rising note of criticism, not among teachers, but among education administrators against these schemes. They are now saying that if there is any money to be provided by the State for children between 14 and 16 years of age, it should flow not through the Ministry of Labour but through the Board of Education, that the President of the Board of Education ought to be the Minister responsible for children between the ages of 14 and 16 years.

In conclusion, let me refer to the question of the means test. I confess that I am whole-heartedly, even passionately, against the application of the means test. It has been suggested that we on these benches have been driven to this position from the outside. For my part, and looking at the matter from the inside, I think that we have gone there ourselves, because we have seen the terrible effect of the means test up and down the country. I never have been in favour of the means test, and for hon. Members opposite to try to draw a parallel between what they call the means test in regard to income and the means test for the unemployed is utterly absurd. The means test is a test on people in dire poverty. Unemployment to-day is not the result of any deficiency or moral delinquency on the part of the individual; it is caused by the society in which we live, it is a social problem, and a social result; and, therefore, ought not to bear upon the individual unemployed. I shall always say that unemployment benefit ought to be regarded as compensation for loss of wages, a loss inflicted on these individuals through society refusing to reorganise itself along lines which would give these people work or maintenance. We shall fight the Bill, and the Financial provisions, because we believe that it is not a good Bill. It will not effect a cure for the juveniles, and certainly will not meet the needs of the able-bodied unemployed of this country.

6.50 p.m.


I do not propose to follow the hon. Member for Aber-avon (Mr. Cove) in his observations upon the means test. The subject, and the alternative policy of the party opposite, was dealt with very effectively in the Debate on the Second Reading of the Bill by my hon. and learned Friend and I may leave it now as he left it. Nor do I propose to attempt to answer the number of rather narrow points which he brought forward in connection with the proposals regarding juveniles. They are points which, I think, can properly be discussed on the Committee stage—no doubt the hon. Member will bring them up again—and I do not want to take up the time of the Committee on them now, although I may say in passing that I think he is under a misapprehension with regard to the capital expenditure which he thinks will be necessary in order to provide accommodation for the training to be given to juveniles. I am told that after consultation with the local authorities it is not anticipated that any considerable amount of capital expenditure will be required; there will be in many areas, if not in most, accommodation already existing which is not required throughout the whole 24 hours which can, therefore, at suitable times be made available for this purpose.

I pass from the hon. Member to say a word about what was said by the hon. Member for Chester-le-Street (Mr. Lawson) in his opening attack on the Financial Resolution. It is rather difficult to know how to deal with the hon. Member, because, although one may make a statement in the most definite terms, he never seems to take it in or, at any rate, to believe it. He asks me to say again exactly the same thing that I said with precision on the Second Reading of the Bill. I refer to his allegations, made also by other hon. Members, first, that we had in some way already given directions to the Statutory Committee to be set up under the first part of the Bill as to what recommendations they shall make in the future, and, secondly, that owing to the other arrangements we have made we have rendered it impossible in the future for any restoration of the cuts in unemployment benefit to take place. When the hon. Member asks that I should now give directions to the Committee, I say that the Bill does not empower me, or any other Minister, to give directions to the Committee. It lays down certain conditions under which they shall make recommendations, and the recommendations they are to make will depend, in the first instance, on the circumstances; that is to say, whether there is a deficiency or a surplus on the fund, but in either case they are given a wide range of discretion as to the particular recommendations they may make either to fill up the deficiency or as to the use of a surplus.


Will the Government be able to use a surplus without the consent of the. Committee?


No. Sir. A surplus will be dealt with after the recommendations of the Committee have been received, and, if the hon. Member will read Clause 17, he will see precisely the conditions under which the Committee give their advice. The hon. Member for Chester-le-Street, in pursuance of his rather imaginary fears, stated that in all probability the Statutory Committee will set up a reserve, I do not know whether it was again in consequence of a direction given to the Committee; but, if he will study the Bill—and I am afraid that I must repeat the advice to study the Bill because it will save us much useless argument—he will find that there is no provision under which a recommendation can be made by the Committee to set up a reserve. On the contrary, according to the Bill they are to recommend such amendments as, in the opinion of the Committee are required in order to make the fund, as the case may be, sufficient or no more than reasonably sufficient to discharge its liabilities; That excludes any question of setting up a reserve.


Does the right hon. Gentleman suggest that they would not be entitled, if they thought it necessary, to put aside money to meet any greater charges on the fund next year?


They are not entitled to do that. If hon. Members will read the report of the Actuary, they will find a statement showing the income and expenditure of the fund for a year. There will be found also a balance of only£85,000. The hon. Member for Chester-le-Street says that, since there is only a balance of£85,000, obviously it is impossible that the fund will ever be restored. That is a statement for a particular year, and does not represent necessarily the condition of the fund in any future year. Is it necessary for me to point out again that the finances of the fund are, and must be, governed principally by the amount of unemployment, and that with the present level of unemployment, or with a level assumed to be somewhere about 2,500,000, there is only a balance of£85,000 in the fund it does not follow, with unemployment falling, as hon. Members opposite anticipate that under the measures of the present Government it will, that there will not be a surplus of substantial proportions in the future? Therefore, I say once again, in order to assure the hon. Member, first, that the Government have not given any directions which will be expected to guide the Committee in the future, secondly, that they do not intend to give any such directions, which, indeed, they are not empowered to give by the Bill, and, thirdly, that if there is a surplus there is nothing to prevent the Committee recommending that it shall be used in any of the ways described in the Second Schedule to the Bill. These ways include, among other things, an increase of the benefits.


May I ask a question on a point of fact? The right hon. Gentleman the Minister of Labour said that£6,250,000 was put on annual transfer to the Exchequer;£6,250,000 was to be handed over to the Exchequer annually. Is that a fact?


Yes, that is accurate. It follows, of course, from the calculation of the number of persons who, by reason of the extended benefit given in the Bill, will come within the purview of the Unemployment Insurance Fund but who are now upon transitional payment and whose relief is therefore now borne entirely by the Exchequer. Reasons are given in the Financial Memorandum which is attached to the Bill why the amount which the Exchequer will save is not as great as the actual amount of the benefits which will be given to the unemployed who come under the fund. But so long as that is still the case—that is to say, so long as those people continue to be on the fund instead of under the Unemployment Assistance Board—so long will this£6,250,000 continue to be saved. It is apparently an offence in the eyes of the hon. Member that anything should be saved by the Exchequer. I cannot understand the attitude of mind which regards the Exchequer as a sort of capitalist putting money into his pocket. After all, the Exchequer in this matter only represents the taxpayers of the country. As the Leader of the Opposition pointed out in the course of the Debate on the Bill, the taxpayers of the country—even the Income Tax payers of the country—are a very much larger number of the people than they used to be, and one therefore has to consider, not a single bloated capitalist Exchequer, but all the taxpayers, all the people who contribute through the taxes to the expenditure of the country.

That brings me to the second point I want to make. The hon. Member was not able to pursue a line of thought which he had desired to put before the Committee, to the effect that the debt should not be & charge upon the fund but that it should come solely on to the Exchequer. He pointed out that if only the Exchequer would bear the cost of the interest and the Sinking Fund—£5,500,000 a year—all sorts of things could be done with that£5,500,000, including increase of benefit and reduction of contributions. That, of course, is perfectly true. If the Exchequer were to make a further annual subsidy to the fund, all sorts of things could be done with it. But would that be to the advantage of the country as a whole? Will hon. Members kindly remember that the more the Exchequer has to pay out, whether it is to the Unemployment Insurance Fund or for any other purpose, the less the Exchequer must have left with which to make those remissions of taxation or restorations of cuts which everybody hopes may some day be made? I am afraid that hon. Members opposite are all daughters of the horseleech: they all cry "Give, give," and they never think whom they are really asking to give. If they would only get into their minds the fact that what they are asking me to give to those who are already enjoying the benefits of the Unemployment Insurance Fund must be taken from the Income Tax-payers, including the small Income Tax-payers, and other taxpayers of the country, they would perhaps not be so reckless about the effect of their recommendations.


Why does the right hon. Gentleman reject the recommendation in this report of the Royal Commission? That is not reckless.


I am afraid the right hon. Gentleman was not here when the Ruling of the Chairman was given that that was not one of the subjects for discussion during the present Debate. I should be very happy to answer his question on some other occasion, but I must keep at present to the subject under discussion.

I now come to another subject which has been engaging a good deal of the attention of hon. Members in the course of the discussion this afternoon, namely, the contributions from the local authorities. I have been accused, not for the first time, of being rather unsympathetic in my treatment of this subject. It is not very encouraging to me, I must say, to be sympathetic when the concessions that I make are treated in the way that one of my concessions was treated this afternoon by the hon. Member for Lambeth (Mr. Briant) whom I do not see present. He described it as a last-minute concession, "wrung out of the Chancellor at the last minute." That is the sort of thing he would say. The fact is that, although I have had a good deal of experience of local government, until I saw the local authorities I could not be expected to guess exactly all the points that they might be desirous of putting before me. When I did see them and heard their case I thought that there was some reason in it, and I then made the concession which the hon. Member now describes as a last-minute concession. That is not very encouraging to the Chancellor of the Exchequer to be reasonable with local authorities, or with any other body that comes to see him.

Let me once again remind the Committee what it was that the local authorities came to ask in the first place. They came with a resolution which they had passed, saying that in their opinion—I may say that they do not make any charge of breach of faith—the whole cost of the relief of the able-bodied unemployed should be a national charge. To that, of course, I replied that 95 per cent. of it was a national charge under the proposals of the Government. Hon. Gentlemen opposite of course think—I daresay like a gentleman who wrote to the "Times" to-day—that that is merely a debating point. They say "We ought to have the whole cost of the able-bodied unemployed put upon the Exchequer—that old capitalist again—but when we come to compute the charge we will not take any account of 95 per cent. of it but only consider the remaining part." That is something more that a debating point; at any rate, it seems to the Chancellor of the Exchequer that when he is already paying£95 out of every£100 of this charge, it is rather absurd to make a great grievance about the fact that he does not pay the remaining 5 per cent. One hon. Member said that he did not understand why, if the Treasury were paying 95 per cent., it was necessary to take any trouble about paying the rest. That is what the Treasury always have to contend with; every concession that is made brings a demand for another concession.

This, however, is a matter of principle. It is not right that local authorities should entirely dissociate themselves from the fortunes of the unemployed in their own districts. They ought not to be asked to bear the greater part of the charge, since unemployment comes—as has so often been said—from causes much wider than those which exist in certain particular localities. But it would be an unfortunate thing if local authorities could feel that they had no longer any financial interest whatsoever in the fate of the unemployed in their districts. For that reason, therefore, I attach importance to the local authorities making some sort of a contribution.

The next point is that the contribution is a fixed contribution. Some hon. Members who have got the tip that unemployment is going down in the next two and a-half years want me to agree that this fixed contribution shall be reduced in favour of the localities if unemployment goes down. They did not say whether they were prepared to do the reverse: that if there should be any increase in unemployment in any particular district, that district should be asked to pay an increased contribution in consequence. That is a suggestion which is directly opposed to the principle upon which this contribution is based. The whole idea of it is that it is not to be a varying contribution. If it were, there might be something in the argument that local authorities were being asked to contribute to a service over which they had no control, but, by fixing the contribution once for all and therefore making it independent of the cost of the services, we avoid that state of affairs.


Is this to be for all time?


No. not for all time, only for two and a-half years. I will come to that point again. Then it is said: "Oh, but perhaps unemployment will go down in the next two years." As to that, one has to take a certain amount of chance, but I would point out, as has been pointed out by the hon. Member for Sunderland (Mr. L. Thompson), that if we had taken it this year we should have found the cost of this service very much higher than that of the year which has been selected as a standard year. Although some local authorities thought, first of all, that I had picked out a year which was especially favourable to the Exchequer, when they found that, on the contrary, if I had taken the current year, the latest year, it would have been more favourable to the Exchequer, they thought that perhaps they had better say no more about standard years.

What about this percentage, 60-40? Of course, as I had to make it clear to the Committee, it is not 60-40 of the whole cost; it is only 60-40 of a portion of the whole cost. With regard to the particular question of the able-bodied unemployed, the hon. Member for Sunderland, in his very reasonably-phrased speech, said that he did not think that 60-40 was reasonable and gave me a very strong hint that if I were prepared to make it 50-50, he would think that that was a fair deal. But I have made it 50-50. I do not know whether my hon. Friend has appreciated the fact that, by another concession which I made to the local authorities when they came to see me and when I said that I would leave the block grant unadjusted, I did in fact make the relief which I was giving to the local authorities not 40 per cent. but 50 per cent.—indeed, it is a little over 50 per cent.

I should just like to give the Committee an illustration in imaginary figures to show how this works out. Suppose that the whole of the transferred expenditure in England and Wales was£5,000,000—and that is probably not very far away from the truth—out of that hon. Members must remember that as a whole 23 per cent. is borne by the block grant, 77 per cent. being borne by the local authority out of rates. That means that out of that£5,000,000 we meet from the block grant£.1,150,000, leaving a net charge on the rates of£3,850,000. We are going to give a relief of two-fifths of the total, that is£2,000,000 out of£5,000,000. Express that£2,000,000 as a percentage of£3,850,000, which is the amount of the net charge on the rates, and you get 52 per cent. So that I have already met my hon. Friend; I have given him not only 50 per cent. but 52 per cent., which is rather more than he asked for.


What I asked the Chancellor to consider was the 00 per cent. of the full amount charged against us.


I do not think that my hon. Friend can dispute my arithmetic, although he may still say that the result is not satisfactory. But I will go on to another point. My hon. Friend comes from a part of the country which has suffered for a very long time from very serious distress. In that part of the country certainly, and in other parts as well, the burden of assisting the unemployed has made demands upon the ratepayers which they have found not only very hard but increasingly hard to bear as time has gone on. But what he is asking me to do is to make an alteration which will affect not only those areas but the whole of the country. It would affect a great number of authorities who not only do not require it but have not even asked for it. A number of local authorities have told me that they are satisfied with the proportion as they stand now. Therefore, although I admit that there is always a certain attraction about a 50-50 arrangement, my hon. Friend will see that his suggestion is not one which really could commend itself to me.


Will there be any opportunity at all, if we vote in favour of the Resolution, to discuss this matter further at a later stage?


If the hon. Member will be good enough to have a little patience I may be able to offer a suggestion. The real fact is this: Although local authorities generally feel themselves bound always to declare that the whole cost of the relief ought to go on the Exchequer, and that rates should be free entirely—although they feel obliged continually to declare that, it is not the real grievance. The real grievance, as it was voiced this afternoon by the hon. Member for Consett (Mr. Dickie), is that the distressed areas under this arrangement, it is thought, have not got special treatment. Again I would point out that they have got special treatment, for several reasons. Those areas which have the highest cost obviously will get a bigger amount of relief than those which have the lower cost. If they have 40 per cent. of£100 it is more than they would get with 40 per cent. of£50. That is obvious. Hon. Members must not shut their eyes to the real facts.

It is quite true that what I am putting is one side of the case. But I am not going to shirk anything in this matter. It is quite true, on the other side, that they will be still left with more to bear. But these are the two sides to the one case. This is not an Equalisation of Bates Bill. It is not possible or desirable to try to equalise rates throughout the country, and certainly not at the expense of the taxpayer. But I have pointed out that, first of all, in the weighting of the block grant, the distressed areas have been specially favoured, and that, secondly, by the arrangement of the Bill, they will in fact get a larger amount of relief, expressed in pounds, than will be obtained by the areas which, more fortunate, have not the same burden to bear. I do not think there is a very strong case for doing anything more than there is in the Bill, but at the same time I do recognise that in some of the areas which are called distressed the distress has lasted for a good many years, and that in those areas there is a feeling that they are being driven really harder than they ought to be, and that not sufficient recognition is made of their special circumstances.

I would like, if only as a gesture to my hon. Friend the Member for Sunderland and others who have put the case to me so reasonably, to show them that I am not entirely adamant on this matter. I have tried to see how it will be possible to help them a little bit more. I would point out that in so far as the grievance arises out of the faulty distribution of the block grant, that has to be a matter for investigation before 1937, when the grant is reviewed. Any demonstration that the present distribution of that block grant works too hardly on those areas is one which may be discussed in the three-and-a-half years. But in order to help a little bit during that period—I recognise that three-and-a-half years may be thought rather a long time to wait—I am prepared to make this proposal: I would be prepared to deduct from the cost as ascertained in the standard year of the transferred expenditure, the amount of the special provisional grant which will be given to distressed areas this year—deduct that from the standard cost and let the 60 per cent. contribution be on the reduced amount instead of on the gross amount. That would mean, as far as I can tell, somewhere about another£300,000 to be distributed to the distressed areas.

I hope that that will go some way to meet the difficulties of those who have raised the matter. As I am prepared to make that concession I assume that my hon. Friend the Member for Walsall (Mr. Leckie) and the hon. Member for Newcastle, East (Sir R. Aske) will not desire to proceed with their Amendment, which of course has the effect of redistributing the relief to be given under the Bill, and would give more to the distressed areas and do it at the expense of the other areas. As this extra relief is to be given from the Exchequer I presume that they will not desire to proceed with their Amendment.

Now there arises the question of procedure. How is this concession to be embodied in the present Financial Resolution? Of course, generally, when one makes a concession in Committee, it is a very simple thing to draw up an Amendment in a manuscript form or else to introduce it at a later stage on Report. But on a Financial Resolution we are more strictly bound. It is not possible for me now to make an Amendment in the Financial Resolution which will carry out what I am proposing. The procedure that I would suggest to the Committee to enable that concession to be made is this: Let us carry on our Debate upon the Financial Resolution as it stands.

Let us deal with the Amendments when they come, and at the conclusion of our proceedings we will move the Chairman out of the Chair. The result of that will be that the Resolution will drop, but I will put down to-night an amended Resolution which may be taken on a date to be arranged, very soon, and will contain a provision carrying out the proposal I have made. The concession can be made quite easily in a short paragraph at the end of the Resolution, and any other Amendments which may be carried in the course of the day's discussion will, of course, be embodied in the amended Resolution. By that method we shall overcome a difficulty which has been foreseen by hon. Members opposite. I hope that the arrangement will meet with approval.

7.25 p.m.


I certainly shall not accuse the right hon. Gentleman of any last-minute repentance. I shall (merely say that everyone who is interested in the local authorities will be glad of the concession, even though it is only a small one. We will certainly willingly lend our assistance in the procedure which the right hon. Gentleman has outlined as being the desirable procedure for putting this matter in order. I want to deal with one or two matters which the right hon. Gentleman has dealt with in the speech, and also with one or two of those with which he dealt in his speech on a former occasion. My hon. Friend the Member for Chester-le-Street (Mr. Lawson) asked the right hon. Gentleman to make clear a certain point. The right hon. Gentleman has not yet made it clear. Perhaps he has not yet appreciated it. As we understand it, this Government gave a pledge that when matters got better they would restore the cuts in unemployment benefit. Under this Bill they have put it out of their power to carry out that pledge, unless they are prepared to give an instruction of some sort, or to make provision by which they can give an instruction of some sort to the statutory body which is to be set up to deal with the first part of the Bill, the insurance part.

The question that was asked of the right hon. Gentleman was, How are the Government going to carry out the pledge which they have given to the unemployed? It was a perfectly clear pledge, which has been repeated again and again, that when matters got better, when the crisis was over—I think that was the term used—tihe benefit cuts would be put back. Now the right hon. Gentleman has explained to us very clearly that the Government will have no power of any sort or kind to determine such a putting back of the cuts if the Bill remains in the form in which it is. What we want the right hon. Gentleman or some other right hon. Gentleman to explain is how, consistently with the pledge they have given, they can put it out of their power to carry out that pledge, as we believe they are doing by the provisions of the Bill. Indeed if one examines the likelihood of the putting back of the cut under this Bill one sees that the likelihood is a small one and necessarily speculative, because no one knows who will be appointed or what sort of views they will have as regards the desirability of dealing with such an insurance fund.

The right hon. Gentleman has to-day said something of which we were not aware. I do not think it is at all clear under the Bill that this statutory body would not be able to put aside any money for reserves. We have been told that this is to be run as a sound insurance scheme, but it is a scheme which has unfortunately started with a load of debt of£115,000,000 against it and it has no assets whatever. One would imagine that in the earlier stages of such a scheme if there was a possibility of periods when the drafts upon it would be greater than the current contributions, the first step of the people in charge would be to build up a reserve so that when the bad days came, if they did come, the fund would be in a position not of bankruptcy but of solvency. The right hon. Gentleman, however, has told us that under the Bill it will be illegal for any sum whatever to be put aside as reserve and, accepting that statement as we do, it makes it just a little more possible that one day there might be a surplus which might be devoted to putting back the cuts. What we object to on this side of the finance of the Bill is the Government putting it out of their power to do that which they pledged themselves to do, time after time, to the unemployed of this country.

The right hon. Gentleman then proceeded to touch lightly on forbidden ground in referring to the£115,000,000.

He said that remissions of the sort suggested by us could only be given if there was a sound economic basis for giving them and that there could be no advantage to the country as a whole if such an arrangement as we suggested were made. We submit that that view is entirely wrong. Without going into the matter in detail, let me deal with the propositions put forward by the right hon. Gentleman in order to show in what respects we regard them as fallacious. Naturally, all payments out of the Exchequer are liabilities on the whole body of taxpayers and the Chancellor of the Exchequer has to judge between the merits of different kinds of payments for different purposes. The question here is whether this particular payment would not be more meritorious than some other payments which are made, judging it by what it will do.

Let me compare it, for instance, with the£32,000,000 which is paid under the derating scheme each year by the Chancellor of the Exchequer. Take the case of the Imperial Tobacco Company who I believe are not very hard up. I think their profit was£9,000,000, or something like that, last year. They get tens of thousands of pounds out of the Exchequer each year as remission of rates, although I do not know that they have ever been put through a means test in order to get it. Is that payment more meritorious than would be the payment of this£5,500,000 to meet a cumulative liability of the whole people of this country, incurred in order to meet special circumstances? The contributors to the Insurance Fund never elected to take in all the extra people whose inclusion has resulted in this charge upon the fund. Parliament forced them upon the Insurance Fund because it was Parliament's easiest way of dealing with the matter and avoiding what might have been serious social trouble if some provision had not been made. To say that you are going to reduce the benefits of persons at present under the fund by making them pay that sum of money is, we think, wholly wrong and unjustifiable, especially when one has regard to other payments made by the Exchequer.

I do not propose to go into the question of the local authorities in view of what the Chancellor of the Exchequer has said, but we believe that the only logical position is that the whole of this liability should be taken over by the State. The sort of difficulty in which the Chancellor of the Exchequer obviously finds himself and from which he has tried to emerge by the payment of£300,000 of blood money is just the sort of difficulty which one inevitably meets if one tries to leave an obvious national liability upon any local authority. The only logical and proper way is to deal with it as a whole and transfer the whole burden of what is a national service to the national Exchequer, and, until that position has been reached, we do not believe it will be possible to get a satisfactory solution of this problem.

I wish to deal with the financial basis of this Bill because it is necessary for hon. Members and for people outside alike to realise exactly what is being done by the Bill. Before 1931 we had arrived at a system of unemployment insurance which was, broadly speaking, satisfactory to everybody, so long as the numbers coming under it were not too large. All Governments treated it as a fair and equitable means of dealing with the unemployed. When the crisis came—when there were large numbers of unemployed and in the so-called financial crisis—certain emergency measures were taken. These were admittedly emergency measures and were never intended to be stabilised. We have now come to a period when we are re-stabilising unemployment insurance, and the comparable system for us now is not the emergency system of the last two years but the pre-emergency system of 1931. In order to find out what alterations are being made in the fundamental finances of the unemployment insurance system under this Bill we must go back to what was considered, before 1931, by all Governments to be a fair basis of dealing with unemployment insurance.

If we take the system proposed under the present Bill in order to see where the liability for the different classes of unemployed is being placed, what do we find? The transitional benefit figure given in the Financial Memorandum—I admit it is stated not to be precise, and, of course, a precise figure cannot be given—is£51,000,000, the figure for last year.

In the Financial Memorandum there are two other figures which enable us to translate that£51,000,000 into what it would be if full benefits were being paid to all recipients. We get figures of£6,250,000 and£8,350,000 given. I think, in paragraph 15 of the document, which shows that£2,100,000, or the difference between those two figures, is the amount which will be found by the families in the case of transitional benefit. If we take that figure of£51,000,000 and multiply it up to the full benefit basis, we get a payment of£68,000,000. If we then take the numbers who are going to be transferred from the Poor Law, representing a figure of£6,500,000 and multiply it up on the same basis, we get a total under Part II of£76,700,000. From that we must deduct the sum represented by the number of people who are going to be transferred to Part I, that is,£8,350,000, leaving an effective charge under Part II of£68,350,000.

The question is, how is that payment being borne under the present Bill? It is quite easy to work it out from the figures. The families of the unemployed are contributing£17,100,000; the local authorities are contributing£3,900,000; and the Exchequer is contributing£47,350,000. Those three sets of people, namely, the families of the unemployed, the local authorities and the Exchequer, in those proportions, are making up the total of the payment under Part II of the Bill. Then take the totals of Part I and Part II together. The benefits paid under Part I, leaving out interest and administration charges, will be£51,850,000. Under Part II the payments will be the figure which I have already given, so that the total, on the full benefit rates, which will be paid under both parts of the Bill, will be£120,200,000. The contributions which will go to make up that sum will be paid in the following proportions:—14½ per cent. from the workers; 14½ per cent. from the employers; 14½ per cent. from the families of the workers; 3¼ per cent. from the local authorities; and 53¼ per cent. from the Exchequer.

Comparing this with the pre-crisis, or pre-1931 proportion of contributions what do we find? If we examine how a sum of£120,000,000 would have been borne under the provisions which then obtained, we shall be able to see the transference of liability which is proposed under the Bill. The Exchequer contribution under the pre-crisis scheme was 73 per cent.; the workers contribution was 13½ per cent.; and the employers contribution was 13½ per cent. In other words the readjustment which is now being made relieves the Exchequer of a liability of£23,160,000 and that liability has been transferred as follows: to the employers£1,100,000, that is the extra contributions; to the workers, the same sum iri extra contributions; to the families of the workers,£17,100,000, that is under the means test; and to the local authorities,£3,900,000. Thus we find that 80 per cent. of the burden which is being taken off the Exchequer is being put upon the workers and their families.

That is the important and vital point in the finances of this Bill. I do not suppose that anybody will suggest that unemployed workers and their families are the people best able to bear the burden of this national crisis. The Government, of course, seeing an opportunity of reducing the charge on the Exchequer and, thereby, reducing the strain on the Budget and giving a remission of direct taxation, no doubt think it worth while to transfer 80 per cent. of the burden on to the unemployed workers and their families. It enables them to make a better showing in the Budget at the end of the year. Of course that is without taking into consideration the fact that benefits have been reduced by 10 per cent. as compared with the pre-crisis level so that the net results of the finances of the Bill are not very fortunate for the workers and their families.

It is because of that underlying principle which has been adopted in this rearrangement of the permanent finances of unemployment insurance that we protest against this Resolution. We protest all the more when we find that this principle is never applied in any other respect. We look at the beet sugar subsidy, the wheat quota, the housing subsidy, the de-rating scheme and we do not find that the main burden is put either upon the relations or the shareholders of the people who get the benefit under those proposals. Let us look at a few instances in London of what happens in connection with derating. Take the printing trade. The St. Luke's Printing Works who print for the Bank of England are relieved of£4,960 per annum' or£95 per week.


From what document is the hon. and learned Gentleman reading?


This is a monthly document entitled "Labour" which gives certain figures. The right hon. Gentleman can check them. If I had quoted them from a monthly magazine entitled "National," he would have dealt with them with great respect. There are a lot of instances which are very well known to the right hon. Gentleman and to a lot of other people—the great breweries, the great tobacco factories, the printing establishments, the great newspaper establishments, and all the rest of them, who get just as good a benefit under de-rating as any other business, and who certainly do not in the least require it. This principle which is apparently so good for the unemployed but so bad for anybody who has any money is one which we believe is essentially and entirely vicious. The right hon. Gentleman said the other day that it was in the real interests of those for whom it was intended. He may be a very good judge of what their real interests are, but, so far as they are capable of judging of their own interests, they certainly do not look upon this as being in their own interests, and they might say, looking at the right hon. Gentleman and judging of his real interests as Chancellor of the Exchequer, that this Bill was in the real interests of the Chancellor of the Exchequer, for whom it is no doubt intended.

There are one or two points which have been raised and which will be specifically debated, I understand, but about which I should like to say a word or two. The right hon. Gentleman has not told us why it is necessary that these Unemployment Assistance Commissioners should be put on the Consolidated Fund.


I understood that this was to be raised in an Amendment which appears on the Order Paper.


Perhaps whoever speaks for the Government on the Amendment will be good enough to tell us for how long these appointments are to be made, because I understand they are being so made that no succeeding Government can disturb them; that is to say, that if some good, hard-baked gentlemen are put in these positions, they will be irremovable by any succeeding Government, and I presume that is why they are being put on the Consolidated Fund. We object entirely to that sort of theory, and we also object to their being taken out of the control of Parliament, because it will not be possible for anyone in this House to discuss their individual actions as members of this Unemployment Assistance Board. We believe it is of the greatest importance that these Commissioners should be kept under the control of Parliament, although obviously it is undesirable that the particular cases of unemployment benefit and so on should be raised in the House.


Why undesirable? You can do it now, with ex-service men's pensions.


Certainly, but with 2,000,000 or 3,000,000 unemployed, it would be impossible to raise all the cases that individual Members might want to raise by way of question and answer in this House. On the other hand, it is very desirable that all those matters should be capable of being raised in Debate in this House, which is, in my view, a far more important thing than merely being able to raise them by question and answer.




The hon. Member takes a different view, but at any rate we both agree that this matter ought to be kept under the control of the House of Commons.


I cannot quite follow the hon. and learned Gentleman. He was in the Labour Government which appointed a commission in connection with anomalies that was put outside the control of Parliament, and they went further. Under this procedure the position is that it cannot operate unless there is an affirmative Resolution, but you put other unemployed people out, and the thing operated without the House of Commons having the slightest control. I cannot understand the hon. and learned Gentleman, and I say this with despair of party politics. I ask this question seriously—and I am a Member with rights equal to those of the hon. and learned Gentleman—How can he denounce the present Government for doing something that in essence and principle he was guilty of doing as a Member of the late Labour Government?


I do not propose to deal with that question, which has been dealt with before. The point upon which I was asking the Government for an answer was as to why these commissioners should be put upon the Consolidated Fund. I believe that it is the first time that any such appointee has been put upon the Consolidated Fund, and not upon moneys provided by Parliament, and thereby put into a quasi-judicial position, which I presume is the intention. We believe that these people should not be put into that position, but that they should be put into the position of being responsible to the Minister, so that questions as regards their administration and conduct could be raised in this House, and it should not be, as in the case of Judges, that Members are not entitled to comment in the House upon anything they do. We look upon that as a matter of the greatest importance.

If I may add one word generally as regards the whole Financial Resolution, the reason why we object so strongly to it and to the Bill with which it deals is that we believe that it is merely designed in order to put the maximum of the burden upon the unemployed and their families, and thereby to relieve the Exchequer of what is essentially and rightly a national charge. It was always accepted as a national charge prior to the 1931 crisis, and this is trying to stabilise conditions which we were told at the time would only be for the emergency. We now find the Government, on the one hand, saying that we are emerging from that emergency and, on the other hand, trying in this very Bill to stabilise a great many of the conditions which at the time they said would only last during the crisis and which they promised would be removed when the crisis was over.

7.54 p.m.


I should like to return thanks to the Chancellor of the Exchequer for his concession. When the concession of£440,000 to the distressed areas was made, I sat here a little ashamed because of the ingratitude that was shown generally by the House, because they thought that more should have been given. There is nothing worse than an ungracious spirit or a spirit of ingratitude, and I should be lacking considerably if I did not make it quite clear to my right hon. Friend the Chancellor of the Exchequer that, while demanding the extra 10 per cent. and knowing that it would be divisible over the whole area, we should welcome a certain amount for the distressed areas in particular. I looked for an extra 10 per cent., and we have not got that, but we have got something like 7 per cent.; and on behalf of myself, and those to whom I have spoken, as I have not been able to associte myself in this matter with all those who are concerned I wish to say that we are thankful for what the right hon. Gentleman has conceded to us, which will go a long way towards meeting the need of the distressed areas.

7.55 p.m.


The information which my right hon. Friend the Chancellor of the Exchequer has been good enough to give to the House and the concession which he has announced will, I think, go far towards meeting the reasonable criticisms that have been levelled against the Bill, and will do much to ensure its smooth passage through the House. The Unemployment Bill and the Financial Resolution can, of course, be viewed from several different angles. The Bill can be looked at from the point of view of the local authorities, and the criticisms of the Bill which have been made to-night have been largely made from that angle. It can also be viewed from the point of view of the unemployed and from that of the public generally, who are vitally concerned as ratepayers and taxpayers. As I see this Resolution and the working of the Bill, I think the Bill provides a happy way of dealing with a very complex and difficult question, and I sincerely welcome it as a courageous attempt to deal with the question in such a way that it will not need to be reopened for many years. If it is not impertinent for me to do so, I should like to congratulate the Minister of Labour on his able statement when introducing the Bill into the House, and to say that that statement has undoubtedly led to the considerable measure of support accorded to the Measure.

In the few minutes which are available to me, I should like particularly to draw attention to the financial statement and its effects with regard to Clauses 36 and 37 of the Bill. In Clause 36 it is prescribed that one of the functions of the Unemployment Assistance Board shall be to deal with the question of employment schemes. They are to provide and maintain training courses for persons who have attained the age of 18, and the board is to be allowed to contribute to the cost of the provision and maintenance of such courses by the Minister in conjunction with a local authority. They are to be permitted to enter into agreements with local authorities to continue this training and instruction for periods not exceeding three months, upon such work as the local authorities consider will render the trainees more fit for regular employment in the future. It will be observed that there are ample safeguards inserted in the provisos. Ministerial sanction has to be obtained, and Treasury safeguards are provided for.

I regard these powers as very valuable, and, so far as I am aware, they incorporate in our legislation provisions which are new both in principle and in effect. I welcome the incorporation of these new principles in this Bill for many reasons. We have seen sporadic, disjointed, and unco-ordinated attempts being made to train the unemployed. Some unofficial bodies have carried out excellent work in this connection, but they have been lacking in powers to make their work really effective. For example, agricultural camps have been formed in Suffolk, near Brandon, with the help of the Society of Friends. They had 800 unemployed recruits, to whom they gave short courses of training. These recruits received board, lodging and some pay. They have improved in weight and health, and have been strengthened in mind and body as the result of attending the courses. There is no doubt that these persons are now better equipped than they were before to find remunerative employment. From the attempts that have been made in this connection, I argue that there is great scope for further training of the kind which is proposed under the Bill. I rejoice, as every Member of the Committee must, at the fact that the vast army of unemployed is slowly decreasing, but I believe that schemes formulated under these Clauses will do a great deal to re-establish the morale of our workless population.

I should like to refer to Part II of the Bill, which deals with the able-bodied unemployed who have exhausted their benefit rights and who, for other reasons, may be outside the insurance scheme. I want to put in a plea under these financial provisions that the scope of these Clauses should be enlarged so that practical working schemes may be evolved in such a way as to prove of benefit, as I believe they can be, both to the unemployed and to the State, and to ensure a fuller return in the future for the taxpayers and ratepayers who assist in financing the schemes. The Minister of Health publicly stated recently that he intends to build some 210,000 houses. I believe that those houses are, in accordance with his scheme, to be built in the course of a five-year campaign. I admire the courage with which the right hon. Gentleman is facing this problem, but I trust that we shall be able to do something under this Bill to reduce the period during which these much needed houses will be provided. I hope, also, that under these Clauses it will be possible to frame schemes by which wide powers will be given so that we can happily marry the part solution of the unemployment problem and the housing problem. To-day we have public opinion with us in this matter, money is cheap, the cost of building is low, and many craftsmen are unemployed. There is ample man-power, and the co-operation of the local authorities is assured in any schemes of a practical nature.

If I may give an example of the type of scheme I have in mind for which money could be successfully used, I would refer to a scheme which is in operation on the Continent. Under it no fewer than 80,000 houses have been built and have been occupied by persons with families of five, so that something like 400,000 persons have been housed. A scheme of that kind is of real benefit to the nation. Under the aegis of the local authorities, and with the help of friendly societies, plans would be prepared and land provided. The State would give the building materials required, and the applicants for the houses would be drawn from the unemployed and the houses erected by the unemployed themselves. When built, the houses would become the absolute property of the unemployed, who would draw lots for them. Therefore, every unemployed man would have an interest in seeing that the work in connection with the houses was carried out as well as possible. The advantage of a scheme of that kind under this Bill would be that the unemployed men would own the houses that they had built, and they would become citizens with a substantial stake in the country. Local authorities would obtain added rateable value and the State would, at any rate, feel that they had some return for the assistance they gave.

There would be the additional benefit that the unemployed would be kept healthy and fit. In so far as these houses would become the absolute property of the unemployed, subject only to a small annual mortgage charge, the unemployed would gain immediately and the State would not lose anything in the long run. Such is the type of scheme which I hope that Clauses 36 and 37 will make possible. There would be no question under such schemes of dole payments or of a subsidy of wages, which so many people regard as a poisonous policy, and I venture to think that it would enable a clear distinction to be drawn between unemployment assistance and poor relief. These Clauses have the germ of great work in them, and I hope that the Minister in charge of the Bill will allow the powers to be widened so that we can develop upon such new lines as will bring advantage to both the unemployed and the State.

8.8 p.m.


I should like to express my thanks to the Chancellor of the Exchequer for the announcement of the concession which he made in his speech. The concession does not give the distressed areas everything which they would like, but it does give them a good deal of what we have been trying to persuade the Government to give. The hon. Member for Aberavon (Mr. Cove) mocked at those of us who represent the distressed areas, and asked why we did not go into the Lobby with the Socialist party if the Government were not doing everything that we thought they ought to do. That is a ridiculous attitude for the hon. Member to take up. There is no reason why we should wreck a Bill in which we believe merely because we do not find ourselves in sympathy with some of the provisions in it. The distressed areas felt that they had a grievance in this matter.

The hon. Member for Sunderland (Mr. Thompson) said this afternoon that there was no question of any breach of faith on the part of the Government among those who were well-informed on the very difficult problems involved. The trouble is that so very few people are well-informed on these extraordinarily complicated problems. I cannot profess to be well-informed myself. A feeling has certainly been growing up that the Government were not regarding the claims of the distressed areas with that sympathy which they had expected. That feeling of disappointment will, I feel sure, be very largely removed by the statement which the Chancellor of the Exchequer made this afternoon. There is a sentence of Shakespeare to which I would like to call the attention of the Chancellor of the Exchequer. It occurs in "Measure for Measure," where a character says: O, it is excellent To have a giant's strength; but it is tyrannous To use it like a giant. The Chancellor has this afternoon shown that with all his strength he is still able to adopt a sympathetic and conciliatory attitude.

8.10 p.m.


I listened with interest to the speeches of the hon. Member for Sunderland (Mr. Thompson). He delivered two speeches. The first was bad enough, but the second was worse. In his first speech he suggested that the Chancellor should alter the formula from 60-40 to 50-50, and I thought that he was easily satisfied to ask for that. That is not what the distressed areas in the North of England have been asking for, however. In his second speech the hon. Member congratulated the Chancellor upon what he had done. I agree that£300,000 is not to be laughed at, but that is not what the distressed areas want. The hon. Member for Sunderland said that, speaking on behalf of those for whom he was entitled to speak, they were thankful to the Government and were satisfied. There was in Newcastle-upon-Tyne only last Saturday a meeting which dealt with this question. The meeting represented the North-East local authorities, and the following resolution was passed: That this meeting of representatives of north-east local authorities regrets that the Government have not embodied in the Unemployment Bill the principle that assist- ance of all able-bodied unemployed should be a national charge. The meeting appeals to the Government to give further consideration to the financial provisions of the Bill and to modify the terms of the Bill so as to afford more substantial relief to areas where unemployment is rife.


The Government have done that precisely this afternoon.


If the hon. Member is going to bring out the banner for what the Chancellor has said to-day, he is easily satisfied. It will not satisfy those who passed that resolution. That meeting expected that the Chancellor would take absolute control and pay for all the able-bodied unemployed. That is what they want in the distressed areas.


Read the resolution again


I will read another one.


Read the one you have just given.


I will read one from Gateshead. A meeting was held there on 4th December, and they resolved: That this meeting representing all shades of public, religious and political opinion, and all classes of business of general and private interest in the county borough of Gateshead vigorously protests against the proposals of the financial clauses of the Unemployment Bill, 1933, which will place upon local authorities three-fifths of the cost of the unemployment assistance of the able-bodied between the ages of 16 and 65 years which, in its opinion, should be undertaken wholly by the State; and that in view of the declarations of Ministers of the Government this meeting considers that the financial proposals outlined in the Bill are a flagrant breach of faith and urges the Government to amend the Bill accordingly. Distressed areas in the north of England want the Government to accept full responsibility for the able-bodied unemployed. That is what was expected by this House; although the right hon. Gentleman said to-night that when he delivered his speech in July he had not got it in mind that the Government should accept full responsibility, but only partial responsibility. When the Parliamentary Secretary to the Ministry of Health wound up the Debate that night, he said: I am going to start by congratulating the representatives of the distressed areas on their brilliant victory to-night. Then, looking across at us, he said: Put that in your pipe and smoke it."—[OFFICIAL REPORT, 6th July, 1933: col. 625, Vol. 280.] That was the language of the Parliamentary Secretary to the Ministry of Health that night. He told us a brilliant victory had been won. There is not very much to boast about that victory now, but everybody believed then that what was meant was that the Government were going to take the responsibility of providing for all the able-bodied unemployed. To-night the Chancellor has said that he will give another£300,000. That is not as much as the distressed areas got in grant to help them a few months ago. They were given then£530,000, to-night it is no more than£300,000, and yet the hon. Member for Sunderland simply showers bouquets upon the Chancellor. He cannot run with the hare and hunt with the hounds. Northern Members have been making the distressed areas believe they were in sympathy with them, and that the Government ought to accept full responsibility for all the able-bodied unemployed, and it is not fair to those distressed areas to congratulate the Government to-night when what has been done falls so far short of what the distressed areas really need. The Chancellor's speech may relieve some hon. Members of the necessity of going into the Lobby against the Government, but I hope the distressed areas will not be satisfied with the terms of that speech and will continue to press and press until the Government accept full responsibility for all the able-bodied unemployed.

The Minister of Labour, in opening this Debate, said that the Resolution provided for the payment of£12,000 a year to the chairman, the deputy-chairman and four other members who will form the Unemployment Assistance Board. I want to enter my protest against the payment of£12,000 to these six gentlemen. One of the extraordinary things in connection with the Unemployment Insurance Fund is the large number of persons who have been drawing big salaries from it. There are about 100 persons drawing£l,000 a year or more from the fund, although the fund has been in such a bad way that it has been necessary to reduce the benefits paid to the unemployed.


They are the brain trust.


They are the brains—they have got the brains to get the money. We are going to pay the members of this board£2,000 each whilst the unemployed who have the first claim on the money, have got to starve. I want to object to the setting up of this new board and the payment of£12,000 a year. In my opinion the board will have far greater powers than the commissioners who are acting in Rotherham and Durham now have. The members of this board may be given a new name, because, possibly, the Government thought it was not nice to call them commissioners, but they will be just such commissioners as we have in Rotherham and Durham to-day, although with more powers than the present commissioners have.

The setting up of this new fund under this Financial Resolution is a step backwards, because the members of the board are to be put upon the Consolidated Fund, and in that case we shall not be able to criticise any of their actions. The present Commissioners in Durham had been in office only for three months when they had to submit a report, which was laid before this House and discussed here; but the new board will have to report only once a year to the Minister. That they should report only once a year is a real step backwards, because it means that, whatever the decisions they may make, the House will have no chance of criticising those decisions except once a year. Really, that is robbing Members of Parliament of their privileges. All the time I have been in this House, until this Government came into office, we have been able to raise any question affecting the unemployed. Now, under this Financial Resolution and Part II of the Bill, the Government will prevent a Member of Parliament from having any chance of raising in this House any question in regard to the unemployed. Members ought to be left with the liberty and the privileges they have always had of raising in this House any case in which the unemployed have not received justice or been fairly dealt with. It is important that Members should have the privilege of bringing forward individual cases. It is all very well for the Minister and the Parliamentary Secretary to try to get clear of that responsibility, and to do away with Members raising individual cases, but when a Member has heard from an unemployed man in his constituency that he has been unfairly treated, it is only right that he should have the privilege of raising the case in the House to see that justice is done.

The new board will be invested with considerable powers. They will have the power to decide what the amount of benefit is to be. That is far more power than the Commissioners have at the present time,' and far bigger powers than public assistance committees possess. At the present time, the public assistance committee and the Commissioners in Durham and Rotherham pay transitional benefit, which is the standard given to them, but the new board will be left to pay what they please. I know the argument, "They can pay more than the amount of transitional benefit," but does any hon. Member believe that that is anything less than a bogey and an attempt to mislead the Committee? Everybody knows that the real object in appointing the board, paying them and giving them the power which is being given to them, is that they will be able to practise more economy at the cost of the unemployed, and to cut down the benefits even more than at the present time. That was the object of the Government two years ago, when they reduced standard benefits and sent the rest of the unemployed, who they said were out of insurance, before the public assistance committees. The object, as we said in the House at the time, was to save more money at the expense of the unemployed. This is just another move on the part of the Government to reduce benefits, and to save still more money at the expense of the unemployed.

I want the Committe to remember that, although we are appointing this board and paying them£12,000 a year, the board will not decide the amount of benefit in any case. They will be in London; those six gentlemen will be sitting here and will not investigate the case of an unemployed man who goes to claim benefit in the north of England. It simply means that the benefit of unemployed men in the country will be decided by clerks in the local offices. That is what happens now, where commissioners are in existence. It is not the commissioners who decide the amount of benefit, but clerks in the office. It does not matter how junior the clerks may be, they decide the amount of benefit. These gentlemen, to whom we are going to pay such a huge salary, will not have the slightest voice in deciding the amount which will be paid to any unemployed man. If the unemployed man is dissatisfied, he will be told, "There is an appeal to the Appeal Court," but the appeal is a farce. The unemployed man has to say to the clerk who gives the benefit, "I am not satisfied, and I want to appeal." He can only appeal if the chairman of this board gives him the right to appeal. When he makes his complaint, he will not be able to get a reply because the clerk will have to send the complaint on to London, in order that the chairman may decide whether the applicant shall be granted an appeal.

We find under the commissioners that a clerk reduces the benefit and, in a good many cases, the applicant, although he is dissatisfied, cannot get an interview with the commissioners, who are sitting in the same town. He is refused an interview. A man cannot appeal the new board, to whom we are going to pay such a very big salary to sit in London. If the chairman agrees that he has the right to an appeal, he may have to wait several days, or a week or two, before he can get the answer that he has the right to appeal. We are to pay all this money to the Unemployment Assistance Board, and the Minister tells us to-night that the staff is to cost£750,000. The Government 'are preparing to spend a lot of money in order to press down the unemployed and to get as much as possible out of them. What is to be the use of the local committee which are to be appointed? The board can appoint local committees if they think fit; I want the Parliamentary Secretary to tell us what 'are to be the powers of such local committees. The local committees will not decide cases, and will not hear any of the grievances of the unemployed. It seems that they are only to be an umbrella, sheltering officials, in order to make it appear that, since there is a local committee, the unemployed can get protection.

The Minister told us to-night about the cost of administration of the new fund. We shall find that No. 2 fund will be in competition with No. 1. I thought that we had plenty when we had No. 1 fund, without setting up another. We object to the unemployed being divided in this way, because we believe that there should be one fund to deal with all the unemployed. We say that it is unnecessary to appoint the Unemployment Assistance Board and pay them£12,000 a year, to pay£750,000 a year to the staff, and then to increase the cost of administration for this second fund up to£4,500,000. Altogether, the cost of administration for No. 1 fund and No. 2 fund will be no less than£9,000,000—money being squandered that ought to go into the pockets of the unemployed. When so much money is spent on administration, it means that the unemployed have to pay for it, and they are called upon to suffer in order that someone else should take the money. I object to appointing the board and paying them this money, and giving them such powers that they need not pay benefit in cash hut in kind. The Minister of Labour, in his speech, in moving the Second Reading of the Bill, justified taking unemployed away from the public assistance committees; this is putting them right back into the Poor Law. It is the habit of the Poor Law to pay in kind in many cases instead of in cash. Under this fund we are giving powers to commissioners to pay in kind instead of in cash, and nobody can justify that.

There is not an hon. Member in this Committee who, if he were addressing his division or a meeting of his electors, would say, "I do not consider that the unemployed are fit to be given money, and therefore we are going to pay them in kind." I further object to the powers of the board, to whom we are paying such huge sums of money, to send men to the workhouse. That is a power that ought not to be given to them. They can pay men in kind and can force men to the workhouse, and when they force men to the workhouse most local authorities will say to those men, "If you come into the workhouse, you must bring your wife and family with you." I was a member of a board of guardians dealing with this work over 20 years ago, and that board always used to say to men, "If you are going into the workhouse, your wife and bairns go too, and you do not come out unless you bring your wife and bairns with you." To-night the House of Commons is going to give power to the Unemployment Assistance Board to say to men, "We will not pay you anything; you will have to go to the workhouse." That is a real step backwards, a reactionary step. Moreover, after it is done a Member of Parliament will have no voice; his mouth will be closed. He will not be able to come and explain to the House how hardly and unjustly a man has been treated, and I think that the whole thing is criminal. The giving away of this power leaves the Minister helpless, without the power to see that justice is done.

This Unemployment Assistance Board, to whom we are paying so much, have not only the power to decide that they will pay a man in kind, and also to tell him he must go to the workhouse, but they can say to him, "You have to go to a training centre; if you do not go to the training centre, away you go to the workhouse." I would remind the Parliamentary Secretary that last year's Report of the Ministry of Labour showed clearly that training centres had not been a success in finding jobs for men after they had gone there, so that to tell men that they must go to training centres when, after they have been to the training centre, there are no jobs for them—to say that they must go there or to the workhouse—is one of the most reactionary things that any government has done. We have never had a government in this country that has proposed to deal with men by paying them benefit in kind or ordering them to a training centre, and telling them that if they do not go to the training centre there is only the workhouse for them.

Far too much power is given to this Unemployment Assistance Board. They can decide whether a man comes into their jurisdiction or not, and they can decide whether a man is to be paid if a trade dispute is in existence. You have in connection with a trade dispute large bodies of men who feel that they ought not to be penalised by the dispute, but these commissioners are to have the power to say whether a man is affected by a trade dispute, and whether he shall receive benefit or not. In my opinion, that is far too much power to give to the Board. I shall not attempt to deal tonight with the question of the power which they are to receive of ordering a searching inquiry into the means of all members of the household, but it is a power which they certainly ought not to possess. I know of a case where a gentleman went to stay for a few weeks with some friends, and, because he did that, the commissioners in Durham said, "That gentleman who has come to stay with you can keep you," and they refused benefit. Cases of that kind will be multiplied over and over again. The Board, on whom so much money is to be wasted instead of being paid to the unemployed, are also to have power to make regulations. They will have to submit them to the Minister, and the Minister can bring them to the House of Commons, but we shall not be able to amend those regulations; we can either accept them or refuse them. I have never seen a House of Commons give away its power as the present House of Commons is giving away its power in these cases to a board of six gentlemen. I venture to say—


We do not know whether they are gentlemen or not.


We will give them the benefit of the doubt anyway, and say that they are, but I object to the House of Commons handing over its power to the six members of this Board, and I venture to say that the day will come when Members of the House will regret the action that they are now taking.

8.41 p.m.


I echo the concluding words of the hon. Member for Spennymoor (Mr. Batey). I only rise to call attention to a very small point on this Money Resolution. 1 assure the Parliamentary Secretary that while during the passage of this Bill, as no doubt in the past, he will find that there is considerable opposition from the Conservative benches to proposals regarding unemployment insurance legislation, such criticisms as may be made, either up here or lower down, are only made in order to improve the Measure, as we think may be done by reasonable criticism.


That is understood.


No doubt it is understood, but my experience is that it is not always understood by the Front Bench. I rise because nobody else has referred to the point in question. I am sorry if I am, like Cassandra, prophesying woe unto our Parliamentary institutions, but, unless I have entirely misread the relevant Sub-section, another vigorous attempt is being made on the part of the bureaucracy to undermine the financial power of the House of Commons. [HON. MEMBERS: "Hear, hear!"] I am glad that so many hon. Members recognise the point with which I am about to deal. I am no lawyer, and, therefore, my interpretation may be wrong, but I have made such inquiries as were open to me to try to find out whether I was wrong, and my friends agree that my version is correct. I want to bring this to the notice of the Parliamentary Secretary, and to ask him to be good enough to put it to an even higher authority as regards the House of Commons, namely, the Leader of the House himself. In paragraph (2, b) of the Money Resolution he will find—I am sorry that this has to be a little in the nature of an exposition, but it cannot be helped in the circumstances, because no one could understand the verbiage otherwise—paragraph (2, b) makes provision for the payment, out of moneys provided by Parliament, of any increase attributable to the passing of Part I of the said Act in the sum payable out of moneys provided by Parliament by virtue of and then there are various references to other unemployment insurance legislation. I am sorry that I must refer also to the Bill, and, of course, on the assumption that the Bill as printed will be passed, because it is only on that hypothetical basis that we can raise this question at all. Under the financial provisions of Part I of the Bill, the Unemployment Insurance Statutory Committee is set up in order to try to keep the fund solvent all the time, and it may make recommendations to the Minister. It produces an Order to the Minister, and the Minister has certain powers with regard to it. It is then brought before both Houses and, if it is approved, the Minister has to make the Order. That is to say that, so far as the Orders of the Insurance Statutory Committee are concerned, we have no power of amendment. They are thrown at us.

But, by the Schedule, they cannot deal with any subject under the sun. They are limited to certain specific matters with regard to unemployment insurance, always bearing in mind that the object of their existence is to keep the fund solvent. In Part II of the Second Schedule it is stated that one of the specific things that the Committee may recommend in the form of amendment is rates of contribution. We have got to this stage that, if the Bill passes, the Statutory Committee can make recommendations for the amendment of rates of contribution in an Order which the Minister will submit to the House and which, if the House passes it, will have the effect of law without the possibility of amendment. That, in itself, excepting for the fact that we cannot make an amendment, would be comparatively harmless if it were not for this, that in one line in the Money Resolution which I cannot understand—I do not know if it is a misprint—one of the kinds of money that are dealt with is an increase attributable to the passing of Part I—moneys payable by virtue of Sub-section (3) of the Act of 1920 as amended by Section 1 of the Act of 1929. This is where the House of Commons comes in. The Amendment, that is, Section 1 of the Act of 1929 as it now is, is an automatic provision by which Parliament has to find as its contribution to the fund one-half of the aggregate amount of the contributions paid by the man and his employer. It is a temporary arrangement. Therefore, if the Order recommends, so as to make the fund solvent, an increase in the contributions, by that Section of the Act of 1930 it would automatically increase the Exchequer contribution. If it automatically increases the Exchequer contribution, we have got to this position, that the Statutory Committee can propose an Order to this House which this House cannot amend, but must either accept or reject, which would have the effect, in the hypothetical circumstances that I have outlined, of automatically increasing the charge on the Exchequer for unemployment insurance.

If that is the right reading of the words, it means that the Government, or bureaucracy, or whatever you call the evil, is running riot with our own system of dealing with charges on the Exchequer, because at present, putting aside this Bill altogether, if there is to be a charge on the Exchequer, you must have a Bill and a Money Resolution, and you have ample opportunity not only of debating but of amending such charges as may be put upon the subject. But, if I read this aright—I hope I am wrong—it means that the Statutory Committee, by this system of Orders, could come to the House and suggest an increase in the contributions and automatically, as the result of the working of that Section of the Act of 1929, raise the charge on the Exchequer without this House—the assent of the other House would be required to the procedure under the Bill—having the opportunity not only of the ordinary forms of debate but of amendment at all. I consider that a very serious blemish on this otherwise not quite perfect Financial Resolution. It is an encroachment on the rights of the House, there is no kind of precedent at all, and it is smuggled in between lines 37 and 43 which are quite unintelligible except to those who have had the assiduity to look up four Acts of Parliament to see exactly to what they refer, and deducing from them and from the Bill what it all means. I hope that the representative of the Treasury may be able to allay my fears. I shall be only too happy if he can but, if he cannot, as this Motion is to be withdrawn in order to be amended so as to turn on the question of the distressed areas, I hope at the same time the opportunity may be taken of amending it in the interests of the financial procedure, age-long as it is, of this House.

8.52 p.m.


I am sure the Committee has been very much interested in what my hon. and gallant Friend has said. This Bill continues the process of handing over the government of the country to committees which has been going so fast for the last two or three years. Not only the present Government, but the predecessor as well, have been obsessed with a passion for handing the government of the country to statutory committees, who are gentlemen selected by the executive for an indefinite purpose at large salaries and increasingly less subject to the control of the House, and even of the Government themselves. Not only has this House been steadily divesting itself of responsibility and power, but the executive has been divesting itself of responsi- bility and power at the very moment when they are most required.

There is one specific point that I desire to raise. The public reading this Debate to-morrow will, I think, be impressed by the very serious charge that was made by the hon. and learned Gentleman the Member for East Bristol (Sir S. Cripps) against the Government. What he said in effect was, "You promised that the cuts in the dole were temporary to meet an emergency during the crisis of 1931. You are now passing a Bill by which you divest yourself of the authority and power to carry out that pledge. You are, in fact, stabilising the cuts." If that were the case, it would be a very serious thing indeed and we must, before we part with this stage of the Bill, have a fairly clear answer from the Government, because it is clear that a revision of these unemployment payments will be called for, we hope in the very near future. The Government are now saying that the crisis is rapidly passing, and that shortly we may emerge into a period of greater prosperity. I hope it may be true, and I believe it will be true, but there is another point that arises in connection with this. It is the avowed policy of the Government to raise prices, and I am in entire agreement with that policy, but I do not think it could be maintained that the Government would have any right to raise prices, particularly of foodstuffs, without retaining in their power absolute authority to raise the rates of unemployment benefit and alter the means allowances at any given moment. I do not think the Government would in those circumstances be justified for a second in divesting themselves of that power.

It is common ground among all parties that one of the urgent needs of the country at the moment is an increase of consumptive power, and there is good reason to hope that next year will see that industrial revival for which we have all been waiting become effective by raising prices. In these circumstances, the Government have now in their power a machine to do what, for example, in the United States President Roosevelt is finding it so difficult to do at present. He is failing to get a response to his efforts for an expansionist policy, largely because he has not the machinery to enable him to do so. If he had the power to raise, for example, the standard rate of unemployment benefit as we have, or could alter the means allowance, he could very quickly put that policy into operation throughout the country, and would not have to go into all the details of industry by industry, and so on. To revert to the first point, I think that at this time, when the executive of this country is to divest itself of the power of direct action in that connection, we ought to have an assurance from the Government that, if it is necessary and justified by increased prosperity and rising prices, they will be able to increase the rates of pay, and the means and dependants' allowances quickly without waiting for a report from any Statutory Committee. It is not their function to divest either the House of Commons or themselves as an executive of powers which they ought to retain.

8.57 p.m.


It would seem to be clear to the Committee from the last two speeches which we have heard that if the Bill is passed, as it is understood, by Members of the House, we have all been deliberately deceived, and that the Government are doing one of the most dishonourable things that any Government could do in deliberately deceiving the unemployed. It was specifically stated when the Government came into office that immediately the emergency had passed the Government would restore the cuts in unemployment pay, and that all the measures which were considered emergency measures and came under the Economy Act should be restored as quickly as possible. The Government really cannot have it both ways. They cannot say to the country that trade is improving, that the emergency has passed and that we are emerging into better times, and at the same time make provision, apparently, for a Statutory Committee to prolong the present cuts of the unemployed. We on these benches certainly heartily agree with what hon. Members have said in that respect. We look upon this Measure as being & piece of typical Tory legislation. It reminds us of the statements which were made about 150 years ago when the Enclosure Acts were passed ostensibly in order to liberate the labourer from the soil. This is a piece of progressive legislation in order to help the unemployed, so we have been told during the last few days.

The greatest problem with which the Government are confronted is the problem of unemployment, and they are hoping to solve it by gagging both the unemployed and every Member in this House. The unemployed person will be gagged in that he will have no opportunity of placing his case before his elected representative as hitherto. He will have no right to ventilate his grievance to his Member of Parliament. The Government hope politically to solve the unemployment problem by gagging the unemployed person, who really should have the right to ventilate his political grievances. In addition, they are deliberately and in perpetuity stabilising poverty. We have heard much from Conservatives in the past about incentive; that the essence of this system, if one is to analyse it, is that it gives an incentive to the individual to better his lot. But the Bill will deliberately destroy whatever theory the Conservative party may have had in that regard in the past. In the future, under Part II of the Bill, it will mean that any person who may be working in the household will have cast upon him the responsibility of carrying an unemployed person partially, and perhaps wholly.

From the financial analysis that the hon. and learned Member for East Bristol (Sir S. Cripps) has specifically placed before us—and I trust that we shall have a reply to that speech—£17,500,000 in the future will have to be borne out of family incomes. That is the amount which the Government are proposing to hand over to Newfoundland. For years the frugal man has been endeavouring from his meagre earnings to put something on one side for a rainy day, and to educate his children. If his daughter or son should have become members of the scholastic profession or competent to earn a living for themselves, and he is rendered idle, he is expected to live upon the income of the children. If the father has accumulated a small income, we find that the first£25 is excluded, and that a shilling is calculated on every subsequent complete£25 against his transitional payment. If he has£300 a sum of 11s. a week is looked upon as income from that total. I am sure that hon. Members here who know anything of investments would like to have such a substantial return. There can be no shadow of doubt that the unem- ployed are placed in a class apart, and that unemployment in the future must be borne by the employed.

When we speak of the depressed areas, what is being done is really infinitesimal. One could occupy the time of the Committee at considerable length in treating of the position of Glamorgan. A report has just been published by the public assistance officer to the County of Glamorgan giving an analysis of the position for the last three years. Would it surprise hon. Members to know that non-determinations for the last three years in Glamorgan amounted to not more than 2.3 per cent., and that 93 per cent. of the determinations for the last 12 months have been full determinations? These figures mean that we have so levelled poverty, that the people in Glamorgan are so poverty-stricken, that 93 per cent. of the homes are in such a state that whenever they have to seek transitional payment they have no income at all. Ninety-three per cent. of the homes in Glamorgan are so poverty-striken that there is no income whatever. The Poor Law rate in Glamorgan is 8s. 5d. in the pound. In the last three years the rateable value for the County of Glamorgan has gone down by£747,000 and the migration from Glamorgan has been 29,000.

What is the use of talking about weighted population? With regard to the block grant and the£66,000 that went to Glamorgan, I take it from the statement of the Chancellor of the Exchequer to-day that the value of that£66,000, which was part of the£440,000 for the distressed areas, shall not be tampered with in respect of this Bill. That is the sum total of what the Chancellor of the Exchequer's statement means to the distressed areas. All the pleas that are made from the distressed areas, all the correspondence that comes from the municipal corporations are of no avail. We have been pleading for places like Glamorgan and Durham. The poor rate in Durham is 9s. 1d. in the pound. What about Merthyr Tydvil? On my left sits the representative of Merthyr Tydvil (Mr. Wallhead). He represents a constituency where the Poor Law rate is 13s. 7d. in the pound, six times the average of the country. Yet nothing has been done by the Government to tackle the problem. All that we have before us is a typical piece of Conservative legislation.

I heard the very able speech made by the Parliamentary Secretary to the Ministry of Labour the other night. It was about the ablest speech I have heard for a long time on this type of question. It gave a remarkable analysis, but I think he could have carried his analysis further. He could have said that this Government stand condemned because they cannot provide 30 weeks' work in two years for men in this country. If they could do that there would be no need for Part II of the Bill, which arises because men cannot obtain 30 weeks' work in two years, and must receive transitional payment. Excluding 13 per cent. who are not insurable persons, the rest of the vast number of persons who are unemployed are divided, and 46 per cent. are in receipt of transitional payment. That 46 per cent. consists of persons for whom this Government, with all their power, and all their talent, all their promises and all that has been done by way of tariffs, cannot provide even six months' work, 30 stamps, in two years. The Government stand condemned. This is a great indictment.


The hon. Member is under A slight misapprehension. The persons who are at present drawing transitional payment consist of two classes, those who cannot produce 30 stamps in the last two years and those who have got the stamps but, nevertheless, have exhausted their 26 weeks' benefit. Many of them have more than 30 stamps in the last two years. The 46 per cent. to which the hon. Member refers will be materially altered, because I explained in my speech that we anticipate that had the present Bill been in operation, in the course of a year, 800,000 persons who at present draw transitional payment would have had the period of their benefit extended and a great number would have been drawing benefit instead of transitional payment. The hon. Member must not forget that there are two separate classes of persons among those drawing transitional payment.


I am grateful to the hon. Member for that explanation, but I have to remember what the Chancellor of the Exchequer said, that there is to be a gain to the fund of£6,250,000. That has to come from somewhere. Obviously, it must come from those who receive transitional payments, instead of giving benefit to them. With regard to the increased number that will be brought in, I question whether we shall have an increased number. I have been in an official position for many years and have had an opportunity of seeing how the fund is administered. The Prime Minister, who formerly represented Aberavon, will remember that there were a large number of collieries in his constituency that came under my purview. It was my business to attend courts of referees where we had to deal with the same class of people who are thrown back under this Act into Part I, but of that particular class large numbers of men are going to be thrown out, and I am inclined to believe that the number of persons who will be thrown out will be equal to the number proposed to be brought in by the Government through another part of the Bill. Therefore, we shall have an aggravation of the problem.

You have good men who have been idle for years expected to go from colliery to colliery, walking their legs off, to be insulted by colliery managers who have no time, if they are to do their duty in carrying out the Regulations of the Mines Act, to be bothered receiving 100, 200 or 500 men who would go to the collieries in the morning. That is what happened in 1924 and 1925. Anyone who has any knowledge of the administration of the Act will concur in detail with what was said by the hon. Member for Spennymoor (Mr. Batey). There is no indication of progressive legislation in this Bill; it is purely retrogressive. It is putting the unemployed in a class apart. It is intimating to them that they are responsible for their economic position. It is saying to the 85,000 miners in South Wales who are totally idle that each one of them is individually responsible for his lot. The Government are treating them as if they had committed some crime. Last Saturday night I had occasion to go to Maesteg to address a branch of the British Legion, 700 strong, and three out of four of those persons are totally idle. Those are the men who saved Britain from 1914 to 1918, men to whom transitional payments apply, men who have been obliged to sell their little bits of property, whether it happened to be a house or anything else, in order to live, because they could not live upon transitional payment. We had have from hon. Members statistics as to what the medical profession consider should be the minimum for a husband, wife and three children if they are to live even upon a very miserable subsistence level, buying beef at 6d. a lb., although as far as I can see the Minister of Agriculture is going to see that they are not able to do it very long, that is his function apparently. On a very low subsistence level they are to have 22s. 6½ d., and are left with 6s. 8d. to pay for rent and clothes and lighting.

Really the Government should take back this insulting Measure. It is indeed an insult to the unemployed of this country; and it is made the more so by the Government saying that it is a beneficent Measure, something which will save the unemployed. Everyone knows that the reason why this Measure has been introduced is to take the unemployed out of politics, to gag the unemployed and those hon; Members of this House who would otherwise be able to bring their grievances before Parliament. Moreover, it is a piece of legislation which stabilises the "cuts" in order that the people whom the Government represents, the rentier class, may continue to draw their unearned incomes and obtain some relief in a few months' time from the Chancellor of the Exchequer by a decrease in direct taxation at the expense of the indirect taxpayers, unemployed and employed alike: We have here the two sides, unemployment to be stabilised upon a starvation level while the Minister of Agriculture is making certain that the consumers, who after all are the unemployed, shall pay increased prices in order to solve the economic problem. I hope the Prime Minister will try to remember some of his Aberavon days, and will realise that he is being made a cats-paw by the Tory party. [An HON. MEMBER: "Rubbish!'] It is not rubbish. Some of us have more knowledge of the conditions than hon. Members opposite. We have associations over a long period of years, and I am hoping that the Prime Minister will even now say that he is not going to stand this Tory ramp much longer.

9.19 p.m.


I rise to support the Financial Resolution because it is essential to the passage of a Bill which, in my opinion, is a most courageous attempt to bring order out of the disorder which the law at present stands with regard to the provisions for able-bodied unemployed. The very title of the Bill is significant—Unemployment Bill. We have had unemployment insurance Bills ad nauseam, two or three a year, for years past, each making the muddle a little worse than it was before. Now, at last, we have a Ministry with the courage and enterprise to put before us a Bill within the covers of which provision is made for all the able-bodied unemployed and at the same time a clear distinction is made between the principle of insurance and the giving of relief. Anyone who has listened to the Debate this afternoon cannot fail to have been struck by the ineffectiveness of the criticism from Labour Benches. Hon. Members opposite on this matter labour under one difficulty, they are opposing proposals which are based on the recommendations of a Royal Commission which they themselves appointed when they were in office. Apparently no Labour Member of Parliament considers himself up-to-date unless he has recently and violently contradicted in opposition everything that he said when in office.


Is it not a fact that the Royal Commission recommended that local authorities should be free of any of this burden and that the Government should carry 100 per cent.?


The Royal Commission recommended many things which the Bill does not contain, but the hon. Member will agree that in the main it is a fair statement that the Bill is based upon the recommendations of the Royal Commission. In one respect I have considerable sympathy with the hon. Member for Chester-le-Street (Mr. Lawson). He was disappointed because he was not allowed to discuss the provisions in the Bill for the outstanding debt. It also happens that I wanted to discuss the same subject—


We have been discussing it all night since.


Although my views would not coincide with those of the hon. Member, or perhaps with the Chancellor of the Exchequer, I agree with the hon. Member that it is unfortunate that owing to the way the Resolution is drawn we are unable to discuss that topic. I will only say that I have yet to hear from the Chancellor of the Exchequer a reasoned argument as to why in this respect he has departed from the clear and emphatic recommendation of the Royal Commission. The chief criticisms we have heard this afternoon against the Resolution may be fairly summed up as being directed either to the question as to whether local authorities should contribute under Part II, and if so, how much, and to questions of Parliamentary control as affected by the provisions of the Bill. As far as the contributions of local authorities are concerned, human nature being what it is, they are always anxious to get from the central Government financial help for services for which they are responsible administratively, and at the same time are loth to give the central Government financial help for services which are to be centrally administered.

In this case the matter is complicated by the fact that the change is intended to take control which has for so long been in local hands into the hands of the central Government. No doubt there is much to be said on either side. There is much to be said for it being kept as a local concern, and much to be said for the administration being a matter for the central Government; but I would point out that so far as the objection to control passing into the hands of the central Government is concerned it is an objection which does not come very well from members of the Labour party, because one of the reasons which has almost driven the Government to consider the question of central administration under Part II has been the fact that in many parts of the country Socialist members of local bodies have proved either incompetent or unwilling to carry out their duties. That is one of the practical reasons which have driven the Government to the conception of a centrally-administered scheme.


Will the hon. Member name those boroughs?


I do not think it is necessary to name them to the House in this Debate. I had in mind boroughs which have deliberately administered the existing law extravagantly, and boroughs where Socialist councillors have refused to serve on the existing committees at all and have left the whole of the work to their Conservative colleagues. Those are the boroughs I have in mind.


They are very much the exception.


The other topic which has been the subject of general criticism is the question of Parliamentary control. I see from an Amendment on the Paper that certain hon. Members opposite are raising a point as to the proper allocation of the salaries of the members of the Unemployment Insurance Board; whether those salaries should be on the Consolidated Fund or should be provided by moneys voted specially by this House. No doubt we shall hear, when that Amendment is moved, such arguments as may be made in support of it. We are, however, up against this general difficulty when we object to things being taken out of the control of this House, that this House already has a great deal too much to do. Whether we like it or whether we do not, the tendency of legislation in this and in other matters must be to try to reserve for this House the discussion of general principles and to leave to other bodies the carrying out of such action as may be necessary under these principles in particular cases. That is, very broadly, what is proposed in this case. There will, of course, always be hon. Members—I have great sympathy with them—who will argue that a Member of Parliament should be able to raise any conceivable subject in this House that affects one of his constituents. There is a great deal to be said for that view. The trouble is that our time is not unlimited, and in a matter of this kind it is obvious that if every hon. Member is entitled to raise individual cases of administration under a Bill of this kind in this House an immense amount of time will be consumed and a great burden will be placed on whomever has for the time being to administer the Ministry of Labour. On those practical grounds, reasonable efforts to keep those details off the Floor of this House are justified and are to be commended.

In conclusion, I might fairly again emphasise the opinion that the Minister who is endeavouring to put into its final form this very complicated and terribly important matter, dealing with so large a portion of our existing legislation for the benefit of these less fortunate members of society, may well derive a certain measure of encouragement that at this stage of the Motion, as on the Second Reading of the Bill, he has had so little serious and informed criticism to listen to.

9.30 p.m.


I beg to move, in line 57, to leave out "the Consolidated Fund," and to insert "moneys provided by Parliament."

The appropriate paragraph of the Motion will then read: C. it is expedient, in connection with the provisions of the said Act relating to Unemployment Assistance, to provide— (1) for the payment out of moneys provided by Parliament to the several members of any Unemployment Assistance Board constituted by the said Act of such salaries as may be determined by the Treasury at the time of their appointment respectively, so, however, that the aggregate amount of the salaries of the members of the board shall not exceed the sum of twelve thousand pounds per annum; An hon. Member remarked some little time ago that the Debate was in doubt as to the issues being raised by certain hon. Members. The point which is being put before hon. Members is that if the words which are now included in the Motion become law, it will be impossible for this House on any future occasion, while they remain the law, to criticise effectively the administration of any unemployment assistance board. I understand from constitutional experts that the payment of salaries out of the Consolidated Fund will put the Unemployment Insurance Board in the same position as a judge of the court.


On a point of Order. In view of the fact that an intimation has been given that the whole of the Motion is to be withdrawn, is it in order that an Amendment should be moved at this stage, or should not the discussion continue on the full lines of the Motion?

The DEPUTY CHAIRMAN (Captain Bourne)

I understand that it was announced that the Government would move at the conclusion of this Debate "That the Chairman do now leave the Chair.' I cannot, however, assume that the Committee will necessarily agree to that Motion, and the hon. Member for Ebbw Vale (Mr. A. Bevan) is in perfect order in moving this Amendment.


I said that if the Notice of Motion prevails in the form in which it stands and the salaries of the board are paid out of the Consolidated Fund, the members of the board will remain entirely outside the control and criticism of this Chamber. On the other hand, if the language of the Amendment is carried and the salaries of the board are to be paid out of moneys provided by Parliament, the administration, the personnel, and the behaviour of the board can come under review every year in Committee of Supply. That is the technical difference, I understand, which at the moment separates the Motion from the Amendment. The principle which is involved is, however, of great constitutional importance. The board are being invested with powers which were formerly possessed by hundreds of local authorities elected to represent the people throughout the country. In the future the board are to have full charge of the administration of assistance to the able-bodied poor, a function which for three centuries has reposed in the hands of elected persons. I am not complaining that this is a revolutionary departure. My criticism is not that the Government are too ambitious. My criticism lies in a different direction: that, in point of fact, if the language of the Motion is allowed to remain, the effective control over the spending of money provided by Parliament will end, because the Unemployment Insurance Board will be determining from day to day in their allocation of unemployment assistance the amount of money which the Chancellor of the Exchequer will have to provide. It is perfectly true that this board will submit to us regulations which we will have the opportunity of discussing, but, as has been pointed out again and again, this House will be faced either with the acceptance or the rejection of those regulations in toto, and we shall have no opportunity at all of amending them. That is gravely restricting the power of this House.

But what the Committee must remember is that in the administration of the means test it is the actual determination of the individual amount which in the aggregate will decide the total sum of money that the Chancellor of the Exchequer will have to find. So that in point of fact the House is parting with its control over moneys provided by Parliament. I contend that in no circumstances whatever should a body of persons appointed by the Minister be permitted to increase or to reduce or to change in any way the burden upon the Budget without this House having the fullest opportunity of discussing their conduct. Then we come to a very much more important point even than that. I understand that this Board will have the appointment of a very large number of persons. Those persons will be appointed, not in the way in which the Civil Service is recruited, but in such manner as may be determined by the Board. The Board will have the power which does not reside in the hands of any persons who receive money from this House, of making an unlimited number of nominated appointments. There have been objections taken, and legitimately taken in this House, to Ministers having the power to make nominated appointments in the Civil Service. The suggestion was made, I think by the hon. Member for Bridgeton (Mr. Maxton) the other day, that the number of nominated appointments was increasing, and that we should at all costs, if we are to preserve the integrity of the Civil Service and the high standard to which it has attained—a standard not attained by any Civil Service in the world—see that the competitive principle is retained.

We have no guarantee at all in the Bill that the appointments made by this Board will follow the same practice as appointments in the Civil Service. We are indeed allowing powers to be created which may cause endless nepotism in the Service. If Members of this House have the welfare of our administrative service at heart they should lay down in the strictest possible detail the manner in which these appointments are to be made and controlled, strictly from the point of view of not allowing arbitrary powers to be exercised by non-elected persons. I take the view that non-elected persons are generally the most corrupt because they are not subject to the pressure of public opinion; they have not to answer to any court of public opinion; their conduct is not brought under review by any reputable body of opinion, and the irresponsibility thus created gives rise to the possibility of endless nepotism.

Therefore, I suggest that the first point to be made is that the Board ought not to be able to exercise this power. If hon. Members look at the Resolution they will see that all the persons who are to be appointed by the Board are to be paid out of money supplied by Parliament. In other words, the Board may appoint an officer and that officer would be paid out of money provided by the House of Commons. The salaries of the Board would be provided out of moneys from the Consolidated Fund. It would appear then that we have some control over the money that is paid to an employéof the Board but no control over the Board itself. But that is a delusion. We should have no control whatever over the employé.It is the Board which controls the employment and dismissal of that person.

What is the situation that is going to arise? A local assistance officer misbehaves himself. Indeed it is absolutely certain that there will be a large number of such persons who will from time to time misbehave themselves. My experience of Poor Law administration teaches me that the more unpleasant the job a man has to do the brusquer the way in which he does it. It is almost a psychological principle. If I have to do an unpleasant thing to a man I do it in an unpleasant way because I want to get rid of him quickly. If a man turns up at the office of one of these unemployment assistance officers and the officer treats him harshly, brusquely, intolerantly, to whom can the man complain? Can he complain to the local authority? The local authority would no longer have any power. Can he complain to a tribunal? No tribunal will have any power over the conduct of these officials. Can he complain to his Member of Parliament? The Member of Parliament cannot raise the matter.

Although it is true that such a man will be paid out of moneys provided by Parliament, he is an employéof the board and the board cannot be brought under review. These local officials who will have the effective administration of unemployment assistance will be responsible only to a small board of people sitting in London, over whom this House has no control at all. I suggest that if you want to prevent ill-feeling of the most dangerous kind arising you must provide the House of Commons with some means of checking the conduct of these people. The point has been made that we do not want an unlimited number of individual cases raised in this House. Individual pensions for ex-service men are now determined under a Royal Warrant, and we have the right to raise any ex-service man's case in this House. If hon. Members will look over the Order Papers for the last five or six years they will see that the number of individual cases raised is very small indeed. But the right to raise individual cases in this House is the very thing which keeps the Department healthy and in check. Once that check is removed, once there is no public tribunal before whom these men can be arraigned, a degree of irresponsibility will creep into the administration and confusion will arise, and ultimately that will have to be cut out by a drastic surgical operation. I submit to the Minister of Labour and the Financial Secretary to the Treasury that they have at their disposal power under which this possible abuse might be prevented.

What would be the effect of the Amendment? The effect would be that annually, on a Vote of Supply, the House of Commons would be entitled to discuss the service and review the year's administration of the board. That would not waste much time and would not be a great burden on the House of Commons, but the consciousness on the part of the board that the House had such an opportunity would necessarily exercise a serious check on its administration. The Minister could make this Bill more acceptable to hon. Members in all parts of the Committee if be accepted an Amendment of this kind. The creation of a board, with arbitrary powers of the kind indicated in the Resolution, is already causing grave disquiet throughout the country. The local authorities will still be asked to find three-fifths of their 1932-1933 contribution towards the able-bodied poor but the board will have ultimate control of the money. The local authorities are to provide the money but are to have no control at all. It has not even yet been determined in what way the local advisory committees are to be appointed. The local authorities, unable to control the expenditure of the money which they have to find, will be in the same position as the House of Commons.

We on this side have certain ideas about democracy which are not shared by hon. Members opposite. Democracy has always been conceived by us as affording an opportunity to the people to make their grievances known in high places in the State. The Conservative party has always regarded that right as a source of political embarrassment. On this occasion the Conservative party are taking advantage of an opportunity of relieving themselves to some extent of that embarrassment. It will be a splendid thing for Conservative Members, particularly those representing industrial constituencies, who are unable to relieve the distress or lighten the burdens of their constituents because of their peculiar political philosophy. If they receive letters or postcards from constituents complaining of the treatment which those constituents have received from the board, they can reply to the effect that they have no control over the administration of the board and consequently can do nothing at all about it. They will be able to say that the board is in the same position as a judge in a court of law. It will be a splendid thing for those Members of Parliament to feel that they have a perfect answer to their constituents. But what about the constituents. What about the poor man with a grievance who has no resource of any kind?

It cannot be argued that if the Amendment were carried the board would be subject to undue pressure. As I say, the review is an annual one and it is a check which we are most anxious to exercise. If it is argued that the members of the board will have very delicate and difficult duties and that their work ought to be taken outside the political arena, I ask hon. Members how they justify that argument? A judge is a person who has to decide an issue between two peers who are before the court as litigants. It is an excellent principle of the British Constitution that the judiciary should be outside the control of the political executive. We have no complaint to make of that principle, and I believe it is that principle which has kept the British courts free, to the extent to which they are free, of political prejudice and pressure. This board is to be placed in the same position of immunity. [HON. MEMBERS: "Hear, hear!"] Hon. Members think that is a splendid thing. But this board will not have to decide as between two peers. They will have to decide with respect to the unemployed who are the wards of the State.

We are responsible for those people. We took away from the local authorities the responsibility of seeing to it that no citizen of this country starved. We assumed that responsibility. We have become the guardians of those persons, and this board will not have to decide an issue between two peers but will have absolute control over the lives and the bodies of these persons for whom we are responsible. The board is to determine the circumstances of households, how much food these people are to eat and how much clothing they are to wear. The board will not be judges in that sense; they will be the executive of the House's responsibility to the poor. Consequently to extend to such a body the immunity now enjoyed by the judges is to introduce into our Constitution a new and a revolutionary principle.

I do not reject it because it is revolutionary. There are many principles which I would like to introduce into the Constitution and which would be revolutionary. But I submit, in all seriousness and earnestness, that if hon. Members try to exercise a little imagination, if they think of all these thousands of local officers acting under the instructions of the board day in and day out all over the country, without any local committee, without any control, administering regulations suggested by the Board, such a spectacle must cause every serious man grave alarm. All sorts of abuses can arise under such a system. I do not believe that it will be possible to carry our Amendment. I am satisfied that the Conservative majority have in this Resolution what they have been seeking for many years, the opportunity to avoid their electoral responsibility to the poor. They are now striving to thrust the poor into the outer darkness in the hope that the voices of those in distress will never reach them.

The House of Commons may take the line that our Constitution requires to be modified and that this assembly has to carry burdens and discharge functions for which it was never intended. To that view we also subscribe. The House of Commons requires modification. But if it is to remain an elected assembly, it must preserve all its electoral responsibilities. We commit ourselves by coming here to the principle that the main agency for social change must be the legislative act; that only by this means can social circumstances be changed or modified. Our presence here means that we do not believe that social change can be brought about effectively in any way except by the legislative instrument. All here share that view, and, if that is our view, there is only one way in which that principle can be kept wholesome and fresh and that is that this Chamber shall be exposed day by day to the aggregate pressure of public opinion. If you divert that pressure, if you open up other channels through which that influence shall flow, you may save yourself embarrassment for the time but you seriously undermine our Parliamentary institutions.

If the Member of Parliament ceases to be the tribune of the people, if he no longer becomes an effective voice in defending his constituents, he loses his dignity, he loses his status, and to the extent to which he loses his dignity and his status, this House loses its prestige in the minds of the people. It is your responsibility. You may kid yourselves in this House that, after all, Parliamentary government in other countries has gone and that what has taken its place is not Socialism but Fascism. You may say that after all you have no need to fear the decline of Parliamentary institutions. They have declined in Italy and in Germany, and you have still got your land, your factories, your workshops, your squires, so that there is no need for you to fear the decline of Parliamentary institutions. You may say that Parliament is no longer the effective way of defending our privileges, because they are effectively defended by Fascism elsewhere, and therefore let Parliament go. But let hon. Members not get the idea into their heads that the Englishman will necessarily go the same road as the German or the Italian, and if these issues are to be decided outside Parliament, let it not be assumed—If the Front Bench opposite want to have a conference, it would be better to go behind Mr. Speaker's Chair and have it. It has now become the accepted principle in this House that if hon. Members wish to embarrass a speaker, they carry, on a small Debate among themselves.


As my hon. Friend looks at me, may I say that I was taking a great interest in the argument he was advancing?


The House will envy the capacity of the hon. Member, who is able to listen to three speeches at one and the same time. I was trying to put the point that if hon. Members feel that the principle which we are at present discussing is of no importance, that the undermining of Parliamentary institutions is not of importance because Parliamentary institutions have been undermined elsewhere, I would like to say, in conclusion, this one word. Let them not for a single moment imagine that because these things have occurred elsewhere, they will necessarily occur in this country. If the poor man has no means of access to those in authority, if he is to become the pawn and the plaything of officialdom, if he has no recourse and no appeal at all to any person whom he may have the opportunity of electing, if that is the position taken up by this House, if that is the view of the Tory party, then the working classes of this country had better make up their minds at once that they have to meet their enemies somewhere else than on the Floor of this Chamber.

These Commissioners will be appointed, they will administer unemployment assistance in South Wales, on the Clyde, and in Lancashire, and in those districts you are saying to my people that you are not going to permit them to avail themselves, as they have done in the past, of any tribune of public opinion. If that is the determined, calm view of this House, then the time has come when we have to decide in what way the people can make their protests known. I submit that it is a serious matter. Hon. Members may laugh at 10 o'clock at night, but it is not as simple as all that. In the past the buffer between you and the people has been this Chamber.


Is it not a fact that the hon. Member himself was the very person who, at the Hastings Conference, opposed Mr. Citrine when he talked about dictatorships, and did he not try to draw a distinction between a dictatorship of the Left and a dictatorship of the Right?


The hon. Member is wrong in two particulars. The first is that it was not at the Hastings Conference. Mr. Citrine did not speak there. The other is that it was at the Trades Union Congress at Bradford, and if the hon. Member will read a full report, and not a garbled report in the Press, he will see that I suggested at that Congress that the danger to democratic government came in this country not from the revolutionary Left, but from the reactionary Right, and that in point of fact some such measures as these in this country are already seriously undermining the democratic rights of the people. We are discussing in this House to-night a most serious Amendment to the British constitution.


Is it not a fact too that the hon. Gentleman himself defended a dictatorship of the Left?


No. I have said that we in this country are perfectly prepared to allow our case to be determined by the normal privileges of the British citizen. The people who are not prepared to do so sit there, opposite, because, under cover of an attack upon my hon. and learned Friend the Member for East Bristol (Sir S. Cripps), the Conservative Government, the National Government, are already making serious inroads into the liberties of the British subject, and the whole history of the last four or five years is the history of declining liberties for the ordinary working man. Here, for the first time in the history of this country, a poor man who is in distress will have no elected person to whom he can appeal, here, for the first time, no tribunal to hear his case, here, for the first time, no means at all of making his grievance articulate, no way of getting beyond—[An HON. MEMBER: "The Trades Union Congress!"] Hon. Members must really try not to treat this argument as though it was other than a serious attempt to try to get this House to visualise the circumstances to which this Bill is going to give rise. The kind of organisation that is going to be created under this Bill means that you are turning your backs on Parliamentary institutions and you are furthering the progressive curtailment of British liberties. We do not mind. Let us know that we have to fight the issue out somewhere else than on the Floor of the House of Commons, let the people know that, and, knowing that, do not deny them—[An HON. MEMBER: "What about the General Strike?"] I am unable to understand the Liberal party, because some hon. Members of the Liberal party have their names down to this Amendment, but, as usual, the Liberals are walking in all directions.


We are querying your right to speak about liberty.


The hon. Member allows his political intelligence to be determined by what has appeared in certain newspapers in the past few months about certain conflicts theoretically between democracy and dictatorship. I am suggesting that under the guise of reformist legislation the Government are attacking British democratic institutions. Hon. Members opposite, under the guise of an attack upon us, are attacking the liberties of the English people. We say that if you are, as you always claim you are, decent English sportsmen prepared to accept the verdict of the polls and prepared to allow us the same liberties as you enjoy yourselves, then you should allow the normal poor person, the ordinary man and woman, the same rights of political articulation as you claim for yourselves. We will accept the verdict of that situation, but that is not what you want. If you want to take away from the ordinary man the tongue with which he speaks, the voice with which he protests, the institutions through which he has for centuries given articulation to his aspirations, you do so at your peril and you, and not we, will regret it.

10.7 p.m.


As my name is attached to this Amendment, I rise to support it and to congratulate my hon. Friend for so vigorously defending it. We on these benches have not always found ourselves in agreement with hon. Members above the Gangway, but on this occasion we are a united opposition. The Chancellor told us earlier in the discus- sion that he proposed to move the Chairman out of the Chair and that if we were able to carry any Amendment he would incorporate it in his new Resolution. I am not sanguine enough to believe that we may be able to carry this Amendment, but one never can tell. My hon. and gallant Friend the Member for Gainsborough (Captain Crookshank) raised a point with regard to procedure, so that it is possible we may find support in other parts of the House. This question, as hon. Gentlemen no doubt realise, is not a question of what is in the Bill; it is a question of procedure.

The other day a member of the Conservative party, as a Tariff Reformer and a friend of freedom and liberty, took exception to the Bacon Order which gave to the Board of Trade the monopoly of deciding who shall import bacon. That is an. example similar to this of withdrawing from the House of Commons its traditional rights. Can we not make an appeal to the Chancellor, now that he has opened the door, before he recommits this Resolution and brings in another, to meet the wishes of a considerable number of Members, drawn from all parts of the House, who possibly do not agree with us and our ideas about the Bill, but who do support the traditions of this House and desire to retain these powers?

The hon. Member for Ebbw Vale (Mr. A. Bevan) says he does not mind if you give away this power. He probably looks forward to the day when his party, which is more associated with giving powers to the State, will be in office. Therefore, to him it is a comparatively light matter, but he does say that so long as the House and the Constitution are maintained we should be very jealous of giving away the powers of the House of Commons. I therefore ask the Chancellor whether it is not possible before this sum is put on the Consolidated Fund for the House to have an opportunity of discussing it in the same way that we have the right of discussing the salary of a Minister. We know from Clause 34 of the Bill what the powers of the Unemployment Assistance Board are to be. The functions of the board, as set forth in Sub-section (2), shall be the assistance of persons to whom this Part of this Act applies who are in need of work and the promotion of their welfare and, in particular, the making of provision for the improvement and re-estab- lishment of the condition of such persons with a view to their being in all respects fit for entry into or return to regular employment, and the grant and issue to such persons of unemployment allowances in accordance with the provisions of this Part of this Act. Further, the board shall arrange for the establishment of advisory committees for such areas as the board thinks fit, and may pay to members of such committees such travelling and other allowances (including compensation for loss of remunerative time) as the board, after consultation with the Minister and with the consent of the Treasury, may determine. I do not suggest for a moment that there is likely to be a misuse of public funds, but I do appeal to the House to consider whether we are wise to give away our power to bring before the House the actions of these commissioners. We should be very jealous of giving away our powers. It has been suggested to those of us who favour decentralisation, a system of home rule all round, that the time may come when we may have an Imperial parliament for Imperial affairs and local parliaments for English, Welsh and Scottish affairs. So long, however, as we have in this House to deal with affairs as they are presented to us, we should not give away our right of calling a commissioner to account and to ask for the removal of grievances and injustices. I therefore appeal to the Chancellor of the Exchequer to see if it is not possible to incorporate some method in the Resolution by which this money, when it is voted for the commissioners, can come before Parliament for review.

10.14 p.m.


As far as I could understand the statement of the Chancellor of the Exchequer, this Resolution is to be virtually withdrawn and reintroduced with the necessary Amendment which he is to propose to suit the distressed areas. That is a procedure we cannot oppose to-night. I only want to make it clear, on behalf of the one or two Members for whom I speak, that when the amended Resolution is introduced we expect to retain the same right to criticise it as if it were a newly-introduced Resolution. I do not want to criticise his concession to-night, because to do so would be out of order on this Amendment, but, speaking as one who comes from a hard-hit area I think his concession will make little inroads on the particular problem of the distressed areas. The Amendment we are now discussing deals with the provision of money for the Unemployment Assistance Board from the Consolidated Fund. I would like to know what defence the Government have for putting the members of this board on the same plane as judges. The theory behind the position of the judges is that litigants ought to feel that the judge, in deciding litigation, is free from Parliamentary pressure, but, if it is sought to set up some sort of analogy between the members of this board and the judges, I would suggest that the proceedings of judges are subject to far greater scrutiny than the members of this board will be.

I could never understand why legal Members in this House have allowed unemployment insurance to grow up without proper legal safeguards. When the Rent Act was under consideration I defended the retention of control not so much because it secured for the people a shilling or two off their rent as because a tenant could not be removed from his house unless the courts decreed it. I have constantly felt that the courts provided some defence to the ordinary citizen in the discussion which goes on between the two litigants in public and the publicity obtained in the Press. Now we have a problem in unemployment insurance which is becoming acute. The law is not the law as passed in this House in a number of Acts; the law to-day is a whole series of umpires' decisions interpreting those Acts. Decisions in a court of law arc argued out in public with a fair amount of skill on each side but these umpires' decisions are come to without either public discussion or public notice, and often without the defendant, the working person involved, having anyone present to champion his case or state his case. Take as an example the case that decided one of the most important matters in connection with unemployment insurance, the phrase, "Not normally in insurable employment," a case which wiped large numbers of people off benefit.


I find it a little difficult to connect the hon. Member's argument with the Amendment. I understand his argument concerns the procedure of the existing courts. This Amendment, whether carried or not, could not affect that procedure.


I am showing what is happening under Unemployment Insurance with some of the safeguards that we have got, and arguing that a more dangerous position may arise without those safeguards. To-day, even under Part I, an unemployed person's rights are passing away, and under Part II we are asked to take a step which is far outwith anything yet done. There is no analogy between the judge in an ordinary court and those who will become members of this board. A judge has to sit in public and has before him counsel for the prosecution and counsel for the defence, both of whom know the law as well as the judge, and both of whom challenge him, and public opinion and the force of the Press come into play. The members of this board are to be put on the same footing, as a judge, without giving them the benefit of the arguments of the counsel for the prosecution and the defence, or the safeguard of the right of the public Press to be admitted. This power is great, because, whereas the criminal has the right to those conditions, the men who will be affected under Part II of the Bill, will, when their benefit is refused, suffer a punishment as severe as that meted out in a court of law to a criminal.

I notice that in the following paragraph it is stated that the staff are to be under the control of Parliament. I cannot see the consistency in that. The staff are to be subject to Parliamentary criticism, and yet they are the servants of a body which is outside Parliamentary criticism. These men, who will be carrying out the wishes of the board, are the servants of Parliament, and yet they can be criticised as subordinates, while those who gave them their orders cannot be criticised. Parliament can, by ordinary procedure, remove the subordinates from office, but the persons who may have caused the trouble are totally outside Parliamentary control.

Speaking in an almost empty House, the hon. Member for Spennymoor (Mr. Batey) put an extremely fine case, and I will take one step in agreement with him. I think that the hon. and learned Member for East Bristol (Sir S. Cripps) fell into the mistake of saying that it might not be well for Parliament to discuss each individual case. In matters of this sort, Parliament never discusses each individual case, but it has the right to do so. Each Member of Parliament has to exercise his discretion. I believe that the, Parliamentary Secretary to the Ministry of Labour would not deny that I deal with his Department in regard to as many individual cases as any other hon. Member. I do not come here with every individual case, but sometimes I come across one that raises a principle. While the case in itself might not mean much, the principle which it raises demands that it should be discussed by this House. An hon. Member who finds a case of that kind must have the right to raise it, and that is all that we are asking. Every hon. Member can raise an ex-service man's case. Under Part I, he can still raise an individual case, but under Part II he cannot, and all that we are asking is that, where we find an individual case which, in the discretion of the Member who has knowledge of the facts, raises a point of principle, we should be able to bring it into public notice.

The board are to be able to go further than the judges. Under the law of this land, an hon. Member can come to this House and put a question concerning a ease in the courts. I question whether he will be allowed to take advantage of that procedure under the proposed new Unemployment Insurance law. You are taking more than 50,000,000 people, British subjects—nay more, you are taking their wives and families—and leaving them at the mercy of a comparatively small group of efficient men, whose power and the danger in regard to whom arise from their very efficiency in tackling this matter. I remember, in the discussions on the Road Traffic Bill, how Members representing their point of view in the House complained that motors were being thrown under bureaucratic control, and many of their fears have been proven true. If that were so then, might I appeal to those same Members now, when greater issues than motoring are at stake? The issues that we are discussing to-night are issues of life and death, issues greater than any criminal trial that I know of. the issue of the right of a man to live. You are going to hand over to this board, not merely the power to give money, but the power to decide moral issues in the case of men and women. They are given the right, if need be, to order institutional treatment, or even payment in kind.

I see no Scottish representative on the Front Bench. I make no complaint of that, because in the main they have always acted courteously towards me. But even in Scotland one of our rights is challenged under this Bill. In Scotland a man to-day, under the provisions regarding Poor Law relief, can go to the Sheriff and, in the full light of public opinion, state his case, and the law can order him to get Poor Law relief That is now gone. Part II says that, while to-day a man can go to the courts and argue his case in public, he must in future enter an Employment Exchange. Upstairs he goes, into a little room, three men meet him, and they decide his fate. He has no one to watch over him, either in the House of Commons or locally. Both are gone, and the man is divested of a great human right which he now possesses.

I read about the Indian constitutional proposals—proposals to give the Indian population some say in their conditions, to raise the so-called oppressed classes. But to-day, while you are arguing about India, you are engaged in a cruel and foul conspiracy to rob, or at least, if not to rob, to endanger the lives of, countless thousands of decent men and women in this country. I have no power in this House and little power outside. I often feel sore with my late colleagues who started the process under the Anomalies Bill. I saw it started, and I fought it; I was the first who undertook the job. I know that not everyone in that party is guilty; I know there are some who feel as I do; but that party did it, and to-day the process goes on, continually gathering in strength. We have Part II of the Bill to-day; Part I will soon become the same. Once you have started payment in kind under Part II, how long can you resist it under Part 1? So the steps grow and become greater in force. I speak in the House of Commons for a group, small though it may be, that has staked out its claim. Whatever the future holds for it I care not. I ask Members to throw aside party politics. They are not asked to give these, poor people more than 23s. 3d.—27s. 3d. for two adults and two children. If they have any decent sporting feelings, let them at least give what they would like themselves—a fair deal.

10.31 p.m.


I suppose there are very few Members of the House who feel more strongly than I do that it is necessary for Parliament to retain control of finance, but I should like to examine whether Parliament is really capable of running a concern such as this Amendment proposes. Have we really so little to do that we are able to undertake the kind of thing that the hon. Member has put so ably in the last two or three minutes? None of us really think that Parliament has sufficient time to go into innumerable questions of detail of this kind. I cannot possibly see how the House of Commons, as constituted, can possibly carry on work of that sort in the best interests of the nation as a whole. One individual Member will follow up the cases in his division very keenly and very ably. Another is a Minister, and he cannot possibly deal with these things at all.

Those are the two sides of that part of it, but there is another question. I feel that it would be just as well if we did not have Ministers too closely connected with matters such as we have here. I think the original position as in the Resolution is better on the whole and that it is much better to leave Ministers to deal with big and wide questions of administration rather than matters of detail. There is far too much Ministerial work and there would be no general bettering of the position, as far as I can see, if you made this financial change which would enable us to deal with the question more often. With regard to the capacity of Parliament to deal with it fairly from the financial position, some of us have been brought up in the old-fashioned belief that it is the duty of Parliament to look after the taxpayers' money. That seems to have been supplanted by the modern belief that it is the duty of Parliament to look after the ratepayers' money and let the taxpayer go hang. As far as I can see, the Amendment would not be to the general public advantage. Parliament is already terribly overworked in many ways and does not, because of the limitation of time and for other reasons, deal with many of the financial questions that it should, and I cannot see how you can put this new burden on it. There are many people who naturally wish to retain Parliamentary control whenever they can, but this is reducing a very fine proposition to rather an absurd point. We cannot control this matter, and it is much better to set up an independent board to deal with it in the circumstances as they exist to-day.

10.35 p.m.


It was rather surprising to hear the hon. Member for Torquay (Mr. C. Williams) after the very eloquent, and, what I thought to be, unanswerable appeal made to the House by the hon. Member for Gorbals (Mr. Buchanan). There has been something in the course of the Committee stage in respect of this Financial Resolution which made me believe that there would not be anybody at all in the Committee who would oppose the Amendment now before us. Time after time Members have risen from the opposite benches and from these benches to say how disturbed they were with regard to the possibilities in Part II against the claims which the people as a whole were entitled to expect from the expansion of the insurance schemes. One hon. Member who does not as a rule agree with all that we say on these benches, pointed out how important it was that we should have the cuts restored and that we should be told here and now that there was a possibility of that being done. Other Members have complained about the position with regard to the means test and its administration.


I do not understand how the hon. Member reconciles his argument with the Amendment now before us, which is to leave out the words "the Consolidated Fund" and to insert the words "moneys provided by Parliament."


I think that I can satisfy you, Captain Bourne, by saying that if one examines the powers of this particular Committee he will see that they will enable the Committee to discharge matters of extreme importance to those who will come within the purview of Part II of the Bill. They have to report ultimately on the question of cuts, so we have been told to-day by the Chancellor of the Exchequer.


I think the hon. Member is now confusing the Board under Part II of the Bill with the Statutory Committee under Part I of the Bill.


May I put it that the provisions of Part II which have to be observed and are referred to in Clause 34 (2) and (3) are sufficient to enable us to appreciate that they will have powers which will affect the rights of many people who will claim benefits under that Clause? In view of the fact that there have been numerous complaints by hon. Members on all sides of the House about the possibilities which lie in Part II, there ought to be no objection at all on the part of those who complain to going into the Lobby in support of the present Amendment. It is clear that if the House is to retain any control at all over those who are to do what is suggested in Subsections (2) and (3) of Clause 34 of the Bill they can only do it by having the power to question that which this particular Committee is to do. If Members honestly believe that Part II is not going to work equitably, as they have said time without number, then there is no reason at all why they should not accept the Amendment at it stands.

I will go further and say that those who claim that Part II will stand for equitable treatment as far as those who come within its purview are concerned, and that the benefits will be such as we have heard from the Government benches, have no reason at all for not permitting the decisions of the Committee to be questioned in this House from time to time so that their assertions may be proved to be correct. That being the case I hope that they will not oppose it, but, on the contrary, that they will give the Amendment their blessing in the same way as they have given it to other Amendments which they now find necessary and which have resulted in the Government having to withdraw the actual Resolution so that they may be embodied in it.

10.40 p.m.


There have been many bodies constituted by Statute which have not been immediately responsible to Parliament, but I can recall no body which stands on all fours with the one that is to be created by this Bill. There have been different bodies appointed for various functions. There was the British Broadcasting Corporation, which is not amenable to this House, and the Electricity Commissioners. Bodies of that kind are created for a specific and limited purpose, and the resources at their disposal to spend are the resources which they themselves earn. The only body which seems to me in the least analogous to the body now proposed to be set up, and I am not sure that the analogy is a true one, is the Import Duties Advisory Committee, but even that is merely, as its name denotes, an advisory committee and can make no decisions of any kind. It can merely make recommendations, which this House may act upon or may refuse to act upon.

We are to create by this Bill a body which is irresponsible and which is not in any way amenable to Parliament. The members of it are, according to the terms of one of the Schedules, to be appointed by Royal Warrant. There is nothing to tell us what are the terms of that Warrant. All we know is that the members of the board will be as irremovable as judges of the High Court. The functions which the board will have to perform are themselves fundamentally different from those performed by judges. It sounds a platitude to say that the duty of a judge is to perform judicial functions, but a body of the sort now proposed to be set up will have to perform executive and administrative functions. Further, judges have no elbow room within which to exercise their private discretion. They are bound by the laws of the land and the precedents laid down in decisions previously. If they are wrong, there is an appeal first, it may be, to the Court of Appeal, and ultimately to the House of Lords. The House of Lords sitting in its judicial capacity is none the less part of this Parliament, and a Legislative Chamber. By the provisions of this Bill the public are to be deprived of access to the high court of Parliament.

I wonder whether there has been any previous Bill which has so undermined the hard-won and age-long rights of this country. This matter is not merely of grave constitutional importance, not merely a grave constitutional departure; the question is whether it is right for this House to entrust any body of per- sons, however able, however ardent in the public service—I do not doubt that those who are appointed will be public-spirited and very able—with the right to expend unlimited sums of public money. I heard the Chancellor of the Exchequer to-day, as I heard him last week, make a plea for the hard hit taxpayer and resent any suggestion that a sum of money, limited and relatively small, and quite distinct and ascertainable, should be placed on the back of the taxpayer. Under this Bill there is being given to the members of the board a completely unrestricted right to dip as deep as they care into the public purse. It is true, of course, that the board is to be bound by the regulations which will be laid before this House and which must, as far as I can understand, be accepted or rejected as a whole, they will be incapable of amendment, but I will prophesy that these regulations will not lay down a standard of allowances by which you will know that the board is merely expending a sum of money which is the standard allowances multiplied by the number of applicants. That would be a sum of money ascertainable by reference to the number of unemployed, but here you will be bound to give a discretion, whether wide or limited, to the Unemployment Board, and since a discretion of that kind is given the liability of the public Exchequer is not limited to any ascertainable sum by reference to the number of unemployed but is an absolutely blank cheque. I say that that is wrong. It is wrong, too, that there should be entrusted to any board not amenable to this House functions which this Bill is designed to entrust to this board. What indeed are the function of the board: To make provision for the improvement and re-establishment of the conditions of the persons to whom Part II applies with a view to their being fit for entry into or returned to regular employment. I say that such despotic powers over the lives of hundreds and thousands of our fellow citizens ought not to be entrusted to any body which cannot be brought to book in the House of Commons for any misconduct or mistakes it may make. It is said, of course, that one of the reasons is to take this matter out of politics. I say that you have no right to take it out of politics, and, in the second place, that you cannot take it out of politics. At present if the public are dissatisfied with the administration of public assistance committees they at least have the right to express their views in one way or another at the election of the local authority. They may be dissatisfied with the administration by this board and express their opinion at the General Election, but it would be quite ineffective for the House of Commons will be unable to give effect to the decision of the voters of this country. I do not think that anyone will contend that that is a situation in which the people of this country should be placed. It is a matter of fundamental importance to public safety and tranquillity that the great mass of people, the poorer amongst us who come within the purview of a board such as this, should be able somewhere or other, somehow or other, to ventilate their grievances and receive a remedy. That opportunity is denied by the provisions of this Bill if the remuneration of the board is to be found out of the Consolidated Fund.

I agree, however, with my hon. Friend the Member for the Gorbals Division of Glasgow (Mr. Buchanan) that it is a very curious circumstance that, whereas the remuneration of the board rests upon the Consolidated Fund, the remuneration of the servants and officers of the board is to be found out of moneys provided by Parliament. That by itself would not be a curious circumstance; one would expect it; but when the Bill is examined it is found to be so drawn that in fact certain decisions, certain determinations which are specifically left to officers of the board by this Bill may be brought before the House of Commons—not indeed the amount of the allowance, for that is to be decided by the board, but whether an individual applicant is to be entitled to an allowance or not. That is a decision which is left to the determination of an officer of the board, and that decision, as the Bill is drafted, could be brought for consideration and discussion before this House. As the Bill is drawn, it is a most remarkable thing that the board as such should not be amenable to the Houses of Parliament, whereas the officers of the board, acting not as agents of the board—for the Bill is drawn so that they shall not so act—but acting in their personal capacities, should be amenable to the judgment of this House. It would be wrong of the House of Commons to pass lightly over a provision which strikes at the fundamental liberties of the British people.

10.52 p.m.


One would think from some of the speeches which have been delivered that the House was in one of the great constitutional crises of its existence. That, however, is not the case. The proposal is quite a simple one, namely, that the Unemployment Assistance Board shall receive their salaries from the Consolidated Fund instead of, as the hon. Gentleman who moved the Amendment would desire, from moneys voted by Parliament. The object that the Government have in view is to impress upon the nation that the board is not a servant of the Ministry of Labour, but enjoys an absolutely independent status. Because of this desire, it has been decided that the members of the board will be appointed by His Majesty by Warrant under the Sign Manual. A similar distinction is enjoyed by many other boards—the Charity Commissioners, the Civil Service Commissioners, the Comptroller and Auditor-General, the Registrar-General, with the Board of Control, the" Comptroller of the Stationery Office, with the Umpire under the Unemployment Insurance Acts, and with many other commissions and appointments. I am sure that the Committee will appreciate the advisability of giving this new board a completely independent status.

If, on the other hand, it were intended to deprive the House of Commons of control over the activities of the board, there would be much in the case which has been presented with such ability. I understand the doubts and anxieties of many hon. Members and particularly of the hon. Member for the Gorbals Division of Glasgow (Mr. Buchanan), but I can assure him that the House of Commons will have, if anything, even more control than it has at present. Every regulation passed by the board or made by the board will be subject to Parliamentary approval. Every report submitted by the board will be discussed by this House, if this House so desire. So will the accounts of the board. The Vote on Account, the Appropriation Bill, Votes of Censure, Adjournment Motions and the Consolidated Fund Bill itself will provide occasions for deliberation upon this board. I do assure the Committee that every single argument that it may be desired to present on behalf of the able-bodied unemployed will be raised quite legitimately under the new procedure.

If I have convinced the Committee that, far from Parliament being deprived on any occasion of an opportunity of discussing this most important subject of the relief of the unemployed, the reverse is the case, I hope the Committee may be inclined to reject the Amendment. The great security, the main security for the impartiality of the administration will be found in the character of the members of the board. It is because we desire to find the very best men and to give them a position of the most complete independence and security that we have decided that the payment of their salaries should come out of the Consolidated Fund rather than out of Votes by Parliament.


Would it be possible for an hon. Member to put on the Order Paper a question relating to the conduct of any officer under this board and to hold the Administration responsible for his conduct?


The Estimates will provide the usual occasion for discussing all the activities of this board, and so far as the staff of the board are concerned the hon. Gentleman knows that the salaries are to be paid out of Votes by Parliament. If the hon. Gentleman desires to ask a question about the activities of the board at any time, or about particular regulations, it will be open to him to put a question on the Paper in the usual way, and he will have an answer.


The important matter for the House is whether it will be possible from time to time to bring the conduct of administrative officers under scrutiny in this House. Would it be possible for us to take the case of a person from a district and put a question on the Order Paper to the Minister of Labour or any other responsible Minister in this House, and to draw the attention of the House to the conduct of such an official; and is it possible for the House to obtain remedial measures against such a person?


It is always for the Chair to decide what matters can or cannot be raised. I should be the last to try to usurp any of the functions of the Chair, and the hon. Member would not expect me to do so. But I have explained that all the usual Parliamentary opportunities will be open to hon. Members in future as they have been in the past—perhaps more Parliamentary opportunities, on the regulations of the board, when they are discussed, on the reports of the board, on the accounts of the board, on the Votes of the Ministry of Labour, on the Appropriation Bill, on Votes of Censure, on Adjournment Motions and on the Consolidated Fund Bill itself. On all these occasions, as heretofore, hon. Members will be allowed, I presume, to raise the activities of the board.


The hon. Gentleman's real defence for this proposal is that the board will be men of character, capacity and integrity. That is always a matter of doubt among various people, according to the way they look at the matter. Seeing that this board is to hold office for a long period will he at least give us this right. Before the Bill passes or before he asks for a Royal Warrant, will the names be submitted to the House of Commons for approval, so that the House can debate the character and integrity of those proposed?


My right hon. Friend authorises me to say that while he cannot give a positive undertaking upon that point he hopes before the Bill is through the House of Commons that he will be able to make an announcement to the House on it.


The hon. Gentleman says the House will have a chance of discussing the reports of the board. Does not Part II provide only for an annual report?


Yes, and that is one of the many occasions, as I have explained, which will be available for discussion.


Would a question be answered by the responsible Minister if it were directed to a determination by an officer of the board in contradistinction to the operations of the board itself? Under Clause 35 of the Bill an officer of the board is charged with certain duties, irrespective of the board, whereas under a later Clause it is stated that the board shall for certain purposes, but certain purposes only, act through its officers. I understand the position as regards the board acting through its officers but I should like to know whether a person who acts as an officer of the board will be amenable to the House?


I have answered in general terms all the questions that have been put to me and I think the answers already given cover the question put by the hon. and gallant Member for Nortlh-East Bethnal Green (Major Nathan). I cannot of course take it upon myself to discharge the functions of the Chair but I am sure, if my hon. and gallant Friend puts down a question in the precise terms of that which He has just addressed to me, he will receive an answer either from my right hon. Friend or myself.


Will the hon. Gentleman answer this question which is in the minds of most hon. Members and certainly in my own mind. If John Smith in my division whom I think entitled to 15s. 3d. benefit in cash, is awarded a food ticket for the grocer around the corner value half a crown, can I raise that matter in the House and demand the full allowance for that man at the time?


Can the hon. Gentleman do so now?




The House of Commons will pass the general regulations of the board. Specific individual cases will be outside the ambit of the regulations.


If such a case happens now I can take the matter up at once with the local public assistance committee. If it is a case of ordinary benefit and if I think there is something wrong I can raise it with the Minister of Labour. Have I still the right to look after the rights of my constituents when these gentlemen under the Consolidated Fund are taking charge of affairs?


If a wrong is done to the constituents of the hon. Member now, he has no appeal. [HON. MEM-BEES: "Yes."] This Bill provides an appeal which he does not at present possess.


At the moment the treatment of the able-bodied poor is in the hands of elected members of the public assistance committee. If there is a grievance the man has a right to go to his own councillor. This Bill abolishes the council and does not put the Member of Parliament in the position of the councillor. We want to know whether we have in future, under this Bill, the power to intervene on behalf of an aggrieved person that a councillor has now.


It has long been the policy of all parties that the State should assume as much as possible of the responsibility for the relief of the able-bodied unemployed. We are assuming the responsibility for that under this Bill. The hon. Gentleman is moving an Amendment which asks that the board should be paid out of moneys provided by Parliament. Supposing the money were so paid, and his Amendment were accordingly accepted, there would still be no question of the board being composed of elected representatives.


I submit that we, on this side, do not mind how we get our reply so long as we do receive a reply to our question. We are discussing not the Board, but the relationship between the Member of Parliament and his constituents.


We are discussing the hon. Gentleman's Amendment.


But the Amendment is designed to give to the Member of Parliament the powers of intervention on behalf of his constituents that are now enjoyed by a councillor. You arc abolishing the powers of a councillor and giving the powers of a Member of Parliament to the Board. This Amendment is designed to restore to Members of Parliament the control over the Board and the right of intervention on behalf of his constituents. Will the Bill, without the Amendment, give the Member of Parliament that right? That is a specific question, and will the hon. Gentleman answer it?


I do not desire to weary the Committee by repeating what I have already said. The hon. Gentleman has moved an Amendment, which we are now discussing. That Amendment says that the Board shall be paid out of moneys provided by Parliament. There is no question of an elected representative. That Parliament shall retain control, whether the moneys are voted by Parliament or out of the Consolidated Fund, is unquestioned. Parliament will have the right of inter-

vention on all the occasions which I have enumerated.


In other words, the answer is that we shall not have power to intervene.

Question put, "That the words proposed to be left out stand part of the Question."

The Committee divided: Ayes, 282; Noes, 70.

Division No. 18.] AYES. [11.9 p.m.
Adams, Samuel Vyvyan T. (Leeds, W.) Duncan, James A. L. (Kensington, N.) Law, Richard K. (Hull, S. W.)
Agnew. Lieut.-Com. P. G. Eastwood, John Francis Leckie, J. A.
Albery, Irving James Edmondson, Major A. J. Lees-Jones, John
Allen, Lt.-Col. J. Sandeman (B'k'nh'd) Elliot, Rt. Hon. Walter Lelghton, Major B. E. P.
Astbury, Lieut.-Com. Frederick Wolle Elliston, Captain George Sampson Levy, Thomas
Astor, Maj. Hn. John J. (Kent, Dover) Eimley, Viscount Lewis, Oswald
Astor, Viscountess (Plymouth, Sutton) Emrys-Evans, P. V. Lindsay, Kenneth Martin (Klim'rnock)
Bailey, Eric Alfred George Entwistle, Cyril Fullard Lindsay, Noel Ker
Baillie, Sir Adrian W. M. Erskine-Boist, Capt. C. C. (Blackpool) Lister, Rt. Hon. Sir Philip Cunllffe
Baldwin, Rt. Hon. Stanley Essenhigh, Reginald Clare Little, Graham., Sir Ernest
Baldwin-Webb, Colonel J. Evans, Capt. Arthur (Cardiff, S.) Llewellin, Major John J
Balfour, George (Hampstead) Fermoy, Lord Lloyd, Geoffrey
Balfour, Capt. Harold (I. of Thanet) Flelden, Edward Brocklehurst Locker-Lampson. Com, O. (H'ndsw'th)
Balniel, Lord Fleming, Edward Lascelies Lockwood. John C. (Hackney, C.)
Barclay-Harvey, C. M. Ford, Sir Patrick J. Loder, Captain J. de Vere
Beaumont, M. W. (Bucks., Aylesbury) Fox, Sir Giftord Lovat-Fraser, James Alexander
Beaumont, Hon. R. E. B. (Portsm'th, C.) Fraser, Captain Ian Lumley, Captain Lawrence, R.
Benn, Sir Arthur Shirley Fremantle, Sir Francis MacAndrew, Lieut.-Col. C. G. (Partick)
Betterton, Rt. Hon. Sir Henry B Fuller, Captain A. G. MacAndrew, Capt. J. O. (Ayr)
Bevan, Stuart James (Holborn) Ganzonl, Sir John McCorquodale, M. S.
Birchall, Major Sir John Dearman Gault, Lieut.-Col. A. Hamilton MacDonald, Rt. Hon. J. R. (Seaham)
Blindell, James Gillett, Sir George Masterman McEwen, Captain J. H. F.
Borodale, Viscount Gluckstein, Louis Halle McKle, John Hamilton
Bossom, A. C. Goff, Sir Park McLean, Dr. W. H. (Tradeston)
Boulton, W. W. Goldie, Noel, B. Macmillan, Maurice Harold
Bower, Lieut.-Com. Robert Tatton Goodman, Colonel Albert, W. Macpherscn, Rt. Hon. Sir Ian
Bowyer, Capt. Sir George E. W. Graves, Marjorie Makins, Brlgadier-General Ernest
Braithwalte, J. G. (Hilisborough) Gretton, Colonel Rt. Hon. John Manningham-Buller, Lt.-Col. Sir M.
Broadbent, Colonel John Grimston, R. V. Margesson. Capt. Rt. Hon. H. D. R.
Brocklebank, C. E. R. Guest, Capt. Rt. Hon. F. E. Martin, Thomas B.
Brown, Col. D. C. (N'th'I'd., Hexham) Gunston, Captain D. W. Mayhcw. Lleut.-Colonel John
Brown, Ernest (Leith) Guy, J. C. Morrison Mills, Major J. D. (New Forest)
Brown, Brig.-Gen, H. C. (Berks.,Newb'y) Hacking. Rt. Hon. Douglas H. Milne. Charles
Browne, Captain A. C. Hall, Capt. W. D'Arcy (Brecon) Mitchell, Harold P. (Br'tf'd & Chlsw'k]
Burghley, Lord Hanley, Dennis A. Mitcheson, G. G.
Burnett, John George Hannon, Patrick Joseph Henry Molson, A. Hugh Elsdale
Campbell, Sir Edward Taswell (Brmly) Harbord, Arthur Moreing, Adrian C.
Campbell-Johnston, Malcolm Harvey, George (Lambeth, Kenn'gt'n) Morris, Owen Temple (Cardiff, E.)
Caporn, Arthur Cecil Harvey, Major S. E. (Devon, Totnes) Morris-Jones. Dr. J. H. (Denbigh)
Carver, Major William H. Hasiam, Henry (Horncastle) Morrison, William Shepherd
Cazalet, Thelma (Islington, E) Haslam, Sir John (Bolton) Most. Captain H. J.
Chamberlain, Rt. Hon. N. (Edgbaston) Headlam, Lieut.-Col. Cuthbert, M. Muirhead, Lieut.-Colonel A. J.
Chapman, Col. R. (Houghton-le-Spring) Henderson, Sir Vivian L. (Chelmsf'd) Munro, Patrick
Christie, James Archibald Hills, Major Rt. Hon. John Waller Nall-Caln, Hon. Ronald
Clarke, Frank Hope, Capt. Hon. A. O. J. (Aston) Nation, Brigadier-General J. J. H.
Clarry, Reginald George Hore-Bellsha, Leslie Newton, Sir Douglas George C.
Clayton, Sir Christopher Hornby, Frank Nicholson. Godfrey (Morpeth)
Cochrane, Commander Hon. A. D. Horsbrugh, Florence North. Edward T.
Collins, Rt. Hon. Sir Godfrey Howitt, Dr. Alfred B. Nunn, William
Colville, Lieut.-Colonel J. Hudson, Capt. A. U. M. (Hackney, N.) O'Connor. Terence James
Conant, R. J. E. Hudson, Robert Spear (Southport) O'Donovan. Dr. William James
Cook, Thomas A. Hume, Sir George Hopwood O'Neill. Rt. Hon. Sir Hugh
Cooke, Douglas Hunter, Capt. M. J. (Brigg) Ormsby-Gore, Rt. Hon. William G. A.
Copeland, Ida Hunter-Weston, Lt.-Gen. Sir Aylmer Palmer, Francis Noel
Crooke, J. Smedley Hurst. Sir Gerald B. Patrick, Colin M.
Crookshank, Col. C. de Windt (Bootle) Iveagh, Countess of Pearson. William G.
Crookshank, Capt. H. C. (Galnsb'ro) Jackson, Sir Henry (Wandsworth, C.) Peat, Charles U.
Croom-Johnson, R. P. James, Wing-Com. A. W. H. Penny, Sir George
Cross, R. H. Jesson, Major Thomas E. Percy, Lord Eustace
Crossley, A. C. Joel, Dudley J. Barnato Perkins, Walter R. D.
Culverwell, Cyril Tom Johnston, J. W. (Clackmannan) Petherick, M.
Davies, Edward C. (Montgomery) Jones, Sir G. W. H. (Stoke New'gton) Pickford, Hon. Mary Ada
Davies, Maj, Geo. F. (Somerset, Yeovil) Jones, Lewis (Swansea, West) Pike. Cecil F.
Denman, Hon. R. D. Ker, J. Campbell Potter, John
Dickie, John P. Kerr, Lieut.-Col. Charles (Montrose) Procter, Major Henry Adam
Duckworth. George A. V. Kerr, Hamilton W. Pybus, Percy John
Dugdale, Captain Thomas Lionel Lamb. Sir Joseph Quinton Raikes, Henry V. A. M.
Ramsay, Alexander (W. Bromwich) Skelton, Archibald Noel Todd. Capt. A. J. K. (B'wick-on-T.)
Ramsay, T. B. W. (Western Isles) Smith, Bracewell (Dulwich) Touche, Gordon Cosmo
Rankin, Robert Smith, Sir J. Walker (Barrow-In-F.) Tree, Ronald
Ray, Sir William Smith, R. W. (Aberd'n & Kinc'dlne, C.) Tryon, Rt. Hon. George Clement
Reed, Arthur C. (Exeter) Somervell, Sir Donald Wallace, Captain D. E. (Hornsey)
Reid, William Allan (Derby) Somerville, Annesley A. (Windsor) Wallace, John (Dunfermline)
Rentoul, Sir Gervals S. Somerville, D. G. (Willesden, East) Ward. Irene Mary Bewick (Wallsend)
Renwick, Major Gustav A. Soper, Richard Ward, Sarah Adelaide (Cannock)
Rickards, George William Sotheron-Estcourt, Captain T. E. Warrender, Sir Victor A. G.
Robinson, John Roland Southby, Commander Archibald R. J. Waterhouse, Captain Charles
Ropner, Colonel L. Stanley, Lord (Lancaster, Fylde) Watt, Captain George Steven H.
Rosbotham, Sir Thomas Stanley, Hon. O. F. G. (Westmorland) Wedderburn, Henry James Scrymgeour
Ross, Ronald D. Stevenson, James Wells, Sydney Richard
Ron Taylor, Walter (Woodbridge) Stewart, J. H. (Fife, E.) Whyte, Jardine Bell
Ruggles-Brise, Colonel E. A, Stones, James Williams, Charles (Devon, Torquay)
Runge, Norah Cecil Storey, Samuel Williams, Herbert G. (Croydon, S.)
Russell, Alexander West (Tynemouth) Stourton, Hon. John J. Willoughby de Eresby, Lord
Russell, Hamer Field (Sheffield, B'talde) Strauss, Edward A. Wills, Wilfrid D.
Rutherford, Sir John Hugo (Liverp'l) Strickland, Captain W. F. Wilson, Lt.-Col. Sir Arnold (Hertf'd)
Salt, Edward W. Stuart, Lord C. Crichton. Wilson, Clyde T. (West Toxteth)
Sandeman, Sir A. N. Stewart Sueter, Rear-Admiral Murray F. Windsor-Clive, Lieut.-Colonel George
Scone, Lord Sugden, Sir Wilfrid Hart Winterton, Rt. Hon. Earl
Selley, Harry R. Sutcliffe, Harold Wise, Alfred R.
Shakespeare, Geoffrey H. Tate, Mavis Constance Womersley, Walter James
Shaw, Helen B. (Lanark, Bothwell) Thomas, James P. L. (Hereford) Young, Rt. Hon. Sir Hilton (S'v'noaks)
Shaw, Captain William T. (Forfar) Thompson, Luke
Shepperson, Sir Ernest W. Thomson, Sir Frederick Charles TELLERS FOR THE AYES.—
Shute, Colonel J. J. Thorp, Linton Theodore Lord Erskine and Lieut.-Colonel
Sir A. Lambert Ward.
Adams, D. M. (Poplar, South) Graham, D. M. (Lanark. Hamilton) Mallalleu, Edward Lanceiot
Attlee, Clement Richard Grenfell, David Rees (Glamorgan) Mason, David M. (Edinburgh, E.)
Banfield, John William Grundy, Thomas W. Maxton, James
Batey, Joseph Hall, George H. (Mtrthyr Tydvil) Milner. Major James
Bernays, Robert Hamilton, Sir R. W. (Orkney & Zetl'nd) Nathan, Major H. L.
Bevan, Aneurin (Ebbw Vale) Harris, Sir Percy Owen, Major Goronwy
Briant, Frank Hicks, Ernest George Parkinson, John Allen
Brown. C. W. E. (Notts., Mansfield) Holdsworth, Herbert Price. Gabriel
Buchanan, George Janner, Barnett Rathbone, Eleanor
Cove, William G. Jenkins, Sir William Rea, Walter Russell
Cripps, Sir Stafford Johnstone, Harcourt (S. Shields) Roberts. Aled (Wrexham)
Curry, A. C. Jones, Henry Haydn (Merioneth) Smith, Tom (Normanton)
Daggar, George Jones, Morgan (Caerphilly) Thorne, William James
Davies, David L. (Pontypridd) Kirkwood, David Tinker, John Joseph
Davies, Rhys John (Westhoughton) Lawson, John James Wallhead, Richard C.
Dobbie, William Leonard, William White, Henry Graham
Edwards. Charles Logan, David Gilbert Williams, Edward John (Ogmore)
Evans, David Owen (Cardigan) Lunn, William Williams, Dr. John H. (Llanelly)
Evans, Capt. Ernest (Welsh Univ.) Macdonald, Gordon (Ince) Williams, Thomas (York, Don Valley)
Evans, R. T. (Carmarthen) McEntee, Valentine L. Wilmot. John
Foot, Dingle (Dundee) McKeag, William Wood, Sir Murdoch McKenzle (Banff)
Foot, Isaac (Cornwall, Bodmin) Maclay, Hon. Joseph Paton Young, Ernest J. (Middlesbrough, E.)
George, Major G. Lloyd (Pembroke) Maclean, Nell (Glasgow, Govan)
George, Megan A. Lloyd (Anglesea) Malnwaring, William Henry TELLERS FOR THE NOES.—
Mr. John and Mr. Groves.

Question, "That this House doth agree with the Committee in the said Resolution," put, and agreed to.

Motion made, and Question, "That the Chairman do now leave the Chair," put, and agreed to."—[Captain Margesson.]