§ Postponed Proceeding resumed on Question, "That the Bill be now read a Second time."
§ Question again proposed.
§ 7.39 p.m.
§ Sir R. Meller
I was about to point out to the House the great advantages which will accrue under the Bill, and to show what would be the cost to a man of 65 years of age who desired to place himself in the position in which he would be placed if he were an insured person under this scheme. This offer is equivalent to a joint annuity on the lives of two persons for £1 per week at 65 with a payment of 10s. a week to the survivor. I am informed that to purchase an annuity of this kind would cost, at the age of 65 of both persons, somewhere in the neighbourhood of £500. That is a pretty large sum, to provide at the present day, on a salary of £250 to £400 a year; it means a great thrift to a married man with a family and and also there is a temptation during the period of saving to use some of the 441 savings to meet an emergency. There is not this temptation or indeed opportunity when provision is being made by instalments paid into a fund to secure the provision. If the individual is able to provide a lump sum, what a tremendous relief and security it must be to know that there is in addition an annuity coming at the age of 65. But that is not all. The annuity to which I refer would cost approximately £500, but this scheme provides also for a pension for the widow, if she is left a widow before 65, and also payments in respect of orphans during their younger years.
Therefore, I have no hesitation in saying that there has never been such an offer made by any Government in this country or any other country as is being made in regard to this particular section. It may be said that it is not a concession which extends beyond the first year, and that when we come to persons after the initial entrance has gone by they can only enter at a rate which is excessive. But what great financial advantages there are even for the higher contributions for those persons who come in later. The scheme does not exclude the right of persons who have qualified under the Health Insurance scheme of becoming voluntary contributors in the ordinary course of insurance. The hon. Lady referred to the great disadvantage in which women were placed by the limitation of £250. The hardship is not as great as she endeavoured to make out or as the hon. Lady made out who spoke before her. Many of these persons will be insured persons long before they pass over the £250 to £400 limit. They will be getting smaller salaries which will entitle them to be insured persons. If it so happens that they are not persons entitled to be insured under the Health Insurance scheme, they will with income limits come into the scheme under the graded contributions according to age.
The invitation issued by the Minister to bachelors to consider the possibility of coming into a voluntary scheme at an early age applies equally to spinsters. Therefore the Minister can be said to have met the objections very well indeed.
It is well that we should remind ourselves of what the State has done by way of pensions. Some hon. Members have been talking to-day in rather depreciative tones of the efforts made by the Government in regard to this particular Measure, 442 but we have to go back not to this Measure only, but to the Pensions Act, 1908, and the Pensions and Widows' and Orphans' scheme of 1925. There we can see what commitments the State has taken upon itself. To-day we are paying over £62,000,000 a year by way of contributions from the State to pension schemes, whether it be the pension scheme of 1925 or the non-contributory pension scheme of 1908, in addition to the other burdens the State bears in connection with Health Insurance or Unemployment Insurance. The advantages enjoyed by workers of this country will be found in a very interesting article published in the "Times" in January, 1936, and they amount to something over £200,000,000 a year. We have to look to the commitments of the future. This Measure and the pension schemes generally are not only commitments to-day, but commitments for the future, and we have to be careful, as wise trustees, that we do not place upon those who come hereafter such heavy burdens that they will be unable to bear them.
It is well that the House and the country should consider all these schemes of social insurance piecemeal, if that be not an objectionable term, and extend them as we are able to bear the cost of them and the people are able to assimilate the benefits and shoulder the burden placed upon them by way of contributions. In that way we shall found our schemes of social insurance on a sound basis and with a security which no other country can excel. All through the difficult period of the War and the financial crisis of 1931 and the year or two that succeeded it, our schemes of insurance came through successfully, and to-day they are as strong as ever, and so, based upon the actuarial advice which has been given, we shall find that the present scheme will be secure.
There is one question which I should like to address to the Minister of Health. In Clause 25 of the actuary's report it is stated that:With regard to health insurance, the rates of contribution fixed for contributors assume the continuity of insurance throughout life and the reserves held by approved societies are calculated accordingly.In the last part of the paragraph the actuary says:This matter will clearly have to be watched in the light of experience, and, in the 443 event of the resources of the fund proving to be insufficient, adjustments of a minor character may be required at a later date.Can my right hon. Friend give the assurance that he will make such provision that as far as the approved societies are concerned, whatever effect this scheme may have upon them, their funds will not be adversely affected? The actuary having called attention to the matter, I assume that it is intended that some provision shall be made in that direction, and it would be a matter of satisfaction to those who are working for the approved societies to have that assurance. In conclusion, I join in the chorus of welcome which has been given unreservedly by the House to the introduction of the Bill, a chorus which will be taken up with the warmest approval by all those who desire to participate in the benefit intended to be secured by the Bill.
§ 7.48 p.m.
§ Mr. Latham
In company with others who have spoken I have no desire to deny to the Government the measure of credit to which, by general agreement, they are entitled, in making provision for conditions which have for so long been known to exist. But however generous-minded we may be in that respect, and appreciative as we are of the fact that there may be in this Measure the foundations for a national pensions scheme, for which there is a universal desire throughout the country, we cannot but direct our attention to the limited character of the provisions of the Bill, typifying, I fear, the characteristic lack of courage which in many directions the Government have shown in recent times. Those limitations can but evoke expressions of regret and disappointment.
In this respect I am entitled to speak of the disappointment that has been and will be aroused, because there have been many occasions for that disappointment among the people with whom for the greater part of my life I have been associated. The Bill has been advertised and eulogistically referred to as conferring extraordinary benefits and advantages upon the black-coated workers. The black-coated workers are examining the proposals, and the more closely they examine them the greater disposition there is to question the claims which have been put forward on its behalf, and to realise the extent to which it falls short of the 444 request which for years they have been making. I speak again with some experience, because as the President for 16 years of the National Federation of Professional Workers it has been my duty from time to time to present to the Minister and his colleagues requests from the black-coated workers of this country indicating a desire that provision should be made in the matter of insurance in directions where, unfortunately, there has been for many years, and it still continues, unfair discrimination against them.
For years past the organisations representing practically the whole, if not the whole, of the non-manual workers of this country have been literally begging and praying the Government to end the discrimination there is against them. They have asked and have been hoping that the Government would do that by lifting the salary limit from its present meagre figure to a figure more commensurate with the requirements of the present day, and that is to a level of £500. By doing that, and without the discriminations of the kind indicated in this Bill, they would have put the black-coated or non-manual workers in a position of no disadvantage compared with the manual workers, because they would then in the matter of pensions, old-age, widows' and orphans' pensions and health insurance, which is outside the provisions of the present Bill, and in the matter of unemployment insurance, which is a very difficult question for tens of thousands of non-manual workers have been put in a position comparable with that occupied by the manual workers.
§ Mr. Lathan
The Minister shakes his head and for what reason I am unable to imagine. He will know the limit that is now imposed in the matter 006Ff provision for the non-manual worker which is not imposed as far as the manual workers are concerned. If this Bill contained the beginning of proposals of that kind it would have given the satisfaction which has been suggested in many quarters but which is only a suggestion not based upon reality—the satisfaction of the manual workers with the proposals. The non-manual workers would in those circumstances have enjoyed a larger measure of satisfaction as a result of the Bill, and that satisfaction would have been increased had the Government given consideration to the proposal which has been 445 alluded to by the hon. Member for the Combined English Universities (Miss Rathbone), namely, a graded system. I recognise the wide experience of the hon. Member who has just addressed the House. We all respect the opinions expressed by him, having regard to his wide experience in these matters but I have never been able to discover what real objection there can be to a scheme of insurance which would permit of a person contributing voluntarily or otherwise on the basis of pay for certain units of benefit. From time to time I have had the responsibility of urging the arrangement of a scheme of that character upon the Minister of Health and other Ministers concerned with insurance, but I have not yet received what has seemed to myself and my colleagues to be an adequate reply.
The present scheme will ultimately mean that the whole of the cost will fall upon some sections of voluntary contributors. Therefore the advantages that are regarded as so substantial and on high such a high value has been placed by the Minister and other speakers will not appear actually to exist so far as the non-manual workers are concerned. It is true that at the outset there are very attractive terms for those who are described as the initial entrants, but there is a limit to that generosity. If one may use a term which is more familiar perhaps to women than to men, the bargain basement of the Ministry will close down within the next 12 months or so, and the conditions, as far as the voluntary contributors are concerned, will be vastly different. The Bill does something else about which there may be real concern. Hitherto under the existing Acts, as the hon. Member for Ashton-under-Lyne (Mr. Simpson) has pointed out, social insurance has been in two main sections, one National Health insurance, and the other section sub-divided into pensions for widows and orphans, and old age pensions. These sections are interlocked and there is one contribution and one card to cover the whole. The Bill proposes to break that interlocking, and in the explanatory memorandum it is stated that this breaking of the interlocking is to enable individuals to select, but only existing voluntary contributors, as I read the proposal, will be entitled to that right. I n future there seems to be no right of selection whatever for those who come in 446 under conditions that may be described as new entry.
As far as those who are in exceptional employment are concerned, while now permitted to take up voluntary insurance for all purposes they will be in a vastly different position, or at least their contemporaries in the future will be in a vastly different position, from the position they occupy to-day. On the strength of the arrangement which permitted them to come under all the headings of health insurance, pensions and widows' and orphans' pensions, approved societies have been set up with the authority of the Ministry, but inasmuch as this Bill now proposes to terminate the arrangement under which there can be such comprehensive insurance as the approved societies provided for—I gathered the Minister's answer to my interrogatory to be confirmation of that—these approved societies will be practically driven out of existence, because the purpose for which they were established will cease and the people for whom they sought to provide will no longer be permitted to exist under the provisions of the Bill. The position, therefore, seems to us to be one that entitles us to request the Minister to give further consideration to the limitations of the Bill in that respect.
It seems to me to be a great pity that a Bill originally or mainly designed to confer benefit should, in so far as one section is concerned, lay down conditions which will deprive certain classes of those who have shown a strong desire for this voluntary insurance, or their contemporaries in the future, of rights. Whilst we can all approve of the general purpose of the Bill and appreciate the benefits that it confers, it is a great pity, for the reasons that I have set forth, that it should be marred by limitations and penal Clauses of the character to which I have referred. I would ask the Minister, in company with those who have made the same plea earlier, to give consideration to these aspects of the case, with a view to adjustments later on.
§ 8.0 p.m.
§ Mr. Channon
This Bill seems to be meeting with the general approval of the House. Certainly it has been received by the country with a feeling of gratitude and relief. In my constituency it has aroused, not only satisfaction, but enthusiasm. The lives of many thousands of people there will be vitally affected by the scheme, and 447 on behalf of my constituents I thank my right hon. Friend for introducing it. We are told that roughly 2,000,000 persons will be affected by the scheme, but dependants will increase the numbers. Of this estimated number of 2,000,000 as many as 3 per cent. live in Southend. The people concerned throughout the country are, the House will agree, an important and splendid section of the community. In the past they have been called upon to make many sacrifices and they have responded ungrudgingly. In a sense these people fall between two stools. They have had the worst of both worlds. They have felt the pinch of poverty, but they have had also, to keep up appearances, to use a repugnant phrase. The people in insurable employment have spokesmen on all sides of this House to champion their causes. It is only the unfortunate black-coated worker who is without a spokesman. For too long his grievances have been forgotten by successive Governments. I am glad that at last this Government has taken up the black-coated workers' case.
The hon. Member for Oldham (Mr. H. Kerr) referred to detached houses. When I walk through my constituency and see rows and rows of these houses, many of them built by building societies, I sometimes wonder what grim tragedies some of them hide. There is no doubt that many of the people in them have a difficult time. I have investigated many of these cases. There is a certain similarity running through all of them. A man in the late 50's, after a breakdown in health, returns to his office—he is usually a clerk—and finds that he is crowded out. He is dismissed after a short time. "Dismissed owing to reduction of staff" is the usual pretext given. The firms cannot be blamed, for they are not charitable institutions. Usually they behave kindly to these unfortunate black-coated workers. The man is given testimonials and three months' pay, sometimes a gratuity of as much as £100. But his career is, although he may not know it, at an end. At first he does not mind his enforced holiday. But after a time he looks for another position. Then begins a losing battle. Weary weeks are followed by anxious months, for who wants to give a job to a man nearly 60? Then comes real hardship for his family. Luxuries and necessities are rationed, the car, if 448 there is one, is sold in order that rates may be paid and school expenses which have not yet come to an end, kept up. Economies have to be made in order that payments on the house, already partly bought, may be completed. There may be no immediate want as yet, for the resources of these people usually last for a year or two. At the end of this time if the man has not found fresh employment he and his family have to resort to the charity of relations, who are none too well off themselves, or to public assistance.
It is people in this sort of predicament who will benefit largely by this Bill. Hon. Members will know many of these cases. Two were reported to me recently that were particularly pathetic. A man, a constituent of mine, earning rather more than the £400 limit allowed in this Bill, was out of employment two years before he could get another job, which was that of a sandwich man. He had to walk about with boards on his back in a town in which he had been respected as a citizen. The other case was that of a man who, for private reasons, perhaps through pride, did not tell his family when the blow of losing his job fell. For many months he took the usual early morning train to London as though he were going to work. He trusted that he might find a new position before his funds ran out. He kept his secret until unfortunately his body was found in Fen-church Street waiting-room.
These may be pathetic and extreme cases, but they are typical of some that will benefit by this Bill. Men in such unfortunate circumstances will at least be assured that their wives and children will be in a measure taken care of. They will know that when they reach the age of 65 they and their wives will have a joint income of £1 a week for the rest of their lives, or 10s. so long as one of them survives the other. Fifty-two pounds a year may not be much to a man who has been earning £400, but it is better than nothing. In many cases the old age pension will bring positive comfort, because almost all these people have resources of some sort. The extra income will add to their comfort—not only physical comfort, but in the vast majority of cases, mental comfort as well. Thousands of homes are haunted by a feeling of insecurity and fears of the 449 future. This Bill will go a long way to dissipate the fears which overshadow them. It will thus add to the sum of national happiness in no small measure.
The only real criticism I have heard against the Bill seems to be that it does not go far enough. That is always a rather sterile form of criticism, for it infers that once a reform has been put on the Statute Book and put into operation nothing further is ever done. The whole history of recent legislation tends to refute this false premise. Almost always a reform which has been found to be both sound and successful is, after a time, extended. I hope that will be the fate of the principle in this Bill. Social services before the War cost no more than 30s. a head. The cost has risen to 17s. 9d. That shows how these reforms grow. Another criticism which I have heard has come from outside the House, probably from what might be called less well-informed opinion. It has been said that the Bill does not strike at the root of the black-coated workers' problem, because it does not offer unemployment benefit. That is rather a large subject, and no doubt, if the Ministry of Labour were to introduce a Bill which would affect the black-coated worker in that connection, it would be welcome. Not more than half these people, however, are in the technical sense wage-earners. They are people who earn their own living in their own way and in their own time. They belong to the long list of small contractors, small shopkeepers, dressmakers, farmers, and others. It would be difficult to insure a man against unemployment when he is his own employer, just as it would not be right, although it might be popular, to insure hon. Members against the fortunes of a general election.
On the whole, the Exchequer has been extremely generous. Clause 6 lays it down that for every £3 paid by the contributor the Exchequer will find £4. For the first time the Government is selling insurance and putting itself almost into competition with the insurance companies. I have no hesitation in thinking that it will win in such competition. My right hon. Friend has given a series of bargains, one of which is that initial entrants, entering the scheme next year at 55, will for 1s. 3d. get an equivalent in actuarial value of 15s. a week. That is a very generous policy. Women who pay 6d. will get a policy worth 8s. There 450 is generous provision also in this Bill for those people who for one reason or another fall in arrears over their payments. Since the details of the Bill were published in the Press, I have had many inquiries from constituents and I should like to ask the Minister if the open door to which he referred could be opened a little wider so as to admit the border case of the man whose 56th birthday falls before the Bill comes into operation. Could the Minister see his way to include people of 56 or 57? I know that 260 contributions must be paid before a man is eligible for old age pensions, but could these people be allowed to pay the back contributions at compound interest from their 55th birthday? I hope he does not consider that to be an unreasonable suggestion. If that course were allowed, these people might very well transfer their savings into this form of insurance. I have been asked by several people if a man is entitled to a rebate in Income Tax in respect of his contributions as he would be if he insured with any ordinary company. If that principle were accepted and the man paid £4 a year, he would be entitled to a rebate of 10s.
I do not want to enter into the question of the limitations in the case of women, because something tells me that we shall have a spate of expert feminine oratory later on, but I do think there is something to be said for raising the limit in the case of women who are heads of families, such as widows with children. Actually, I am sorry that the Minister should have found it necessary to fix it at £400 in the case of men because there are cases of men with children and other obligations who with £500 a year are no better off, indeed are sometimes worse off, than the man with £400. I see no reason why, once a scheme of this sort becomes a paying proposition, there should be any limit at, all. I should have thought that people might be able to enjoy this amenity of our national life as they enjoy other amenities. That may be a dream of the future, but I think it could be done at no great cost to the Exchequer.
I have also been asked some questions in regard to unearned income. As I understand it, anyone up to £200 is entitled to £200 a year unearned income. A man with £300 is still entitled to £200. as unearned income; and that the same proportions will apply in the case of women. It is probably more important 451 that women should be allowed the full £125 unearned income because there are many women who are eking out their old age on a very small income. I am glad that these women are to be included in the scheme. Many of them have a private income of £100 or £125 a year, which they supplement now and then by sporadic employment. It is important that they should be included, and many of them have written to me on the matter. Several hon. Members have referred to the approved societies. I read this morning in the official organ of the approved societies, the "National Insurance Gazette," this statement:The Pensions Bill is a great step forward. The rest of the civilised world is watching it with interest. We should like to congratulate those who are responsible for the scheme. It is very clever, indeed. It is far better than we thought possible.I should have thought a statement like that would clear up any doubts there may be in regard to the attitude of approved societies towards the Bill. I would like to assure the right hon. Gentleman that of the many burdens which the taxpayer is asked to bear I think none will be more cheerfully shouldered by the community as a whole than the burdens which are imposed in this Bill.
§ 8.19 p.m.
§ Mr. Cove
I do not intend to go into the general questions which have been raised in relation to the provisions of the Bill. My only right to intervene in the discussion is the fact that the Minister has made special provision for allowing male teachers to be included in its scope, and it is my duty and privilege to thank the Minister for the courteous reception he gave to the representations which the hon. Member for Stourbridge (Mr. Morgan) and I made to him on more than one occasion. May I also be allowed to express our deep appreciation of the attitude of the head of the Department, Sir Walter Kinnear, a magnificent civil servant, who has received us with so much sympathy over a long period of time and listened to the many representations we have made? We are glad that the Minister, knowing the tortuous history as far as the teachers are concerned in this matter, has decided that at long last male teachers are to be included in the provisions of the Bill
While we may rejoice at the mechanics of the Bill and the general structure of 452 the Measure, there is also occasion for being rather sad. Here you have a class of people who may earn up to £400 seeking security on a low level of 10s. per week pension. I have been impressed by the communications I have received with the intense desire for security among a class of people who are supposed to be in secure jobs, who are so keenly desirous of getting the 10s. and 5s. a week provided by the Bill. Obviously there is something wrong with the modern state of society when such a feeling of insecurity can exist. I want to make one or two special pleas. Generally speaking, as far as male teachers are concerned, the provisions of the Bill bring in all the assistants in the elementary schools of the country, and also a large number of headmasters. But there is one class of assistant male teacher I want the Minister to consider. Generally speaking, all the male teachers in the provinces will be able to come within the scope of the Bill, but not those who are on the maximum in London and in the extra-Metropolitan district. The maximum there is £408 per annum. These teachers fear that this narrow margin will mean that they will be unable to come under the Bill.
I want the Minister to consider one or two points in relation to this matter. In the first place, these male teachers in the London area are within the general structure of the Burnham salary scheme and there is a provision in that scheme for Scale IV which allows for a higher rate of payment in London and the extra-Metropolitan area. I do not know all the considerations which entered into the determination of these standards of pay, but I should imagine that one of them which entered into the consideration of a slightly higher level for the London area was the cost of living in the area. I think it can be justly said that from the point of view of real income these people are on a level with those in other areas. I hope that will be considered as an argument in favour of bringing in that class of male assistant teacher in London. I know that there will always be marginal cases, and that if the figure were fixed at £500 or £600, there would still be marginal cases; but I suggest to the right hon. Gentleman that this one is of an exceptional nature, in that it affects a whole class, even though there are not very many involved.
453 If the Minister considers the matter carefully, I think he will see that it is an exception which, if granted, would not open the door to other applicants, because, among other reasons, the payment of these people is part of the general salary structure.
My second argument is that the real income of these men is below the £400 level. The State has decided that teachers must not continue to teach in schools after they have reached the age of 65, and they are compelled to retire with a pension. In order to get that pension, the State has further declared that contributions must be levied from the teacher's salary. In other words, as the legal phrase goes, the contribution on account of pension is an expense due to the particular occupation of the teacher. If the contribution paid for superannuation is taken into account, the whole class of male assistant teachers in London will he able to come under the provisions of this Bill. I can assure the Minister, from letters I have received, that there is an exceptionally keen desire that this opportunity should be presented to these teachers. I do not wish to hide the fact that this benefit is anxiously desired by the male teachers, and indeed there are signs that the women teachers are beginning to desire it as keenly. The profession as a whole is very grateful for the opportunity of being able to come into the scheme. I think it would be a pity and indeed an injustice if these male teachers in London, who happen to have a gross salary of £408, although their net salary is below that figure owing to the fact that there is a legal compulsory contribution on account of pensions, were kept out of the scheme.
I think I have shown clearly that here is an exception which need not upset the provisions of the Bill. I gather that under the Bill the Minister has power to make regulations and to consult various interests. He will have power to make regulations concerning the various factors that are to be taken into account in regard to the income limit. In that case, I hope we may have from him an assurance at least that he has not completely closed the door to consideration of this case of male teachers in the London area particularly, and that, even if we cannot in Committee move amendments designed to allow a larger number to come under the scheme, he will consider 454 sympathetically the case of these male teachers. In conclusion I would like to thank the Minister, and to express my gratitude to the civil servants concerned, particularly Sir Walter Kinnear, who has always shown a keen and sympathetic interest in those teachers who are not provided for under the ordinary superannuation scheme which applies to teachers.
§ 8.31 p.m.
§ Mr. Guy
I am sure the Minister must be gratified with the very friendly reception which the Bill has received in all quarters of the House. I am not surprised by that reception, for I regard this Bill as a very valuable contribution to and extension of our social services. I am particularly glad that the pledge which the Prime Minister gave at the last General Election is being carried out so effectively—a pledge that, in spite of the expenses that would have to be incurred in building up our Defence Forces, the social services would not only be maintained, but extended. There can be no question as to the need for the Bill, and that has been generally admitted. I would like particularly to mention the class of small shopkeepers, both men and women, to many of whom this scheme will bring a real benefit, because many of them have suffered not only from the trade depression but also, in my division, from the operations of slum clearance.
The hon. Member for Westhoughton (Mr. Rhys Davies), in opening the Debate from the Opposition Benches, truly said that the country is becoming more and more pension-minded, but he rather suggested that there was a demand for the extension of non-contributory pensions, a statement which I challenge most definitely. In the course of inquiries which I have made, I have found, little or no evidence of any such demand, but I have found a genuine demand, which I hope will gradually become effective, for an extension of contributory pensions. It will be generally admitted that nowadays we get very little for nothing, and that even in the case of charity there must be some sacrifice of independence and pride in many cases.
As to the one criticism that has been made—the differentiation between the salary qualification of men and women—I confess that the arguments used by the 455 Minister in favour of the differentiation did not entirely convince me, and I think that the same arguments might have been used as a justification for making the limits the same. Admitting that there must be a variation in circumstances, and that in many cases the women have not the dependants that the married men have, these very circumstances would make these women on the higher salary scale of £250 to £400 better "lives" from the insurance point of view. They would be more likely to pay for 52 stamps in a year instead of a minimum of 26, and consequently, instead of being a drain on the fund, they would be an advantage to it. Consequently, I think the question of raising the salary limit for women to the same level as that for men should be reconsidered.
The hon. Member for Westhoughton and one or two other hon. Members mentioned the position of the unmarried women under this Bill, which involves to a certain extent their position under the compulsory Contributory Pensions Acts. A question was put to the Minister on that point and I hope the Parliamentary Secretary will reply to it. I would put it in a rather more definite form than that in which it was addressed to the Minister. Is it the case that under the compulsory Contributory Pensions Acts, there are, approximately, 4,000,000 unmarried insured women whose contributions, with their employers' contributions, at the rate of 5½d. per head per week, total about £5,000,000 and that only 80,000 unmarried women get contributory old age pensions at 65 costing only £2,000,000? I admit that these figures are not official, but when some of us who went on a deputation to the Minister last summer, asked for an inquiry into the question, we were told that the facts were all known and that an inquiry was unnecessary. I, therefore, ask whether these figures are accepted or not? If they are not, what are the correct figures? If they are correct, and they have not been challenged yet, they indicate that single women under the existing scheme are not getting a fair deal.
To use the Minister's own expression, one fundamental consideration in these pension schemes should be justice to the beneficiaries and justice to the State. In this case it would appear that a class of 456 beneficiaries are being treated unjustly. Because of that fact, many of the unmarried women who will be affected by the Bill, are a little suspicious about its actuarial basis. I must confess that I take some of the statements in the Government Actuary's Report with a certain amount of hesitation, because it seems to me that in the estimates which are being made of the value of these old age pensions to different people, and to the women in particular, no allowance is made for the cases in which the woman does not survive. There must be a definite death rate between the ages of 55 and 65 and in the case referred to by the Minister of the single woman who could go to an ordinary insurance company and get a policy to cover the old age pension at 65, at 1s. 6d. a week, there is this distinction. Not only is the risk covered of the death rate before 65 but there is also, I understand, a surrender value and one of the grievances of the unmarried insured woman in this scheme is that there is no surrender value for her insurance policy. She may contribute year after year to the old age pension, the only pension to which she can contribute, but even when she has paid 15 or 20 years contributions, there is no surrender value. I should like to know whether the contingencies to which I refer have been taken into consideration.
The hon. Lady the Member for the English Universities (Miss Rathbone) referred to the possibility of working out a graduated scale which would allow for a differentiation in benefits. There is a good deal to be said for that suggestion, and I concur in all the points which the hon. Lady made. I would, however, put forward an alternative suggestion with reference to the single women in particular. Incidentally I would remind the Parliamentary Secretary that they have now a large organisation in the country and that that organisation is growing steadily. It is known to my hon. Friend and to the Government that they have been pressing for some time for a reduction of the age at which old age pensions are payable. They have a case for that, into which I am not going now, on grounds of equity and finance. But in connection with this Bill I wonder whether it would be possible to allow for the payment of old age pensions at the age of 55 to single women who will come in under the Bill, provided that there is an adjustment of 457 contributions. That is a point which might be considered in Committee, and I would like the Parliamentary Secretary to indicate whether it is a matter to which consideration would be given by the Government. To put it in another way, I ask whether it would be possible, instead of having the age of 65 for the payment of the pension to single women who come in under the Bill up to the age of 55, to provide as an alternative that they might come in up to the age of 45, with an adjusted contribution, actuarially calculated, qualifying them for the old age pension at the age of 55 instead of 65. That proposition, I submit, ought to receive consideration. Although I admit that the case of the single women who come in under this Bill is not, from the point of view of hardship, so strong as the case of the insured single women mentioned by several speakers, yet there is definite evidence that it is extraordinarily difficult for middle-aged or elderly women in insurable industry to retain their employment or to obtain other employment if they lose it.
In the Bill we have a measure of consolidation of unemployment insurance and a measure of consolidation of National Health Insurance and Contributory Pensions legislation. This additional instalment of pension legislation will make a definite advance but before that is done, there ought to be a complete survey of the contributory asocial services with one idea in mind—not to make the system intricate and involved, but to see whether there could not be more elasticity to meet the variation of circumstances and more simplification, possibly with a view to developing a single comprehensive insurance scheme under which there would be one card and one stamp per week for all the different divisions. I believe that such a scheme was adumbrated 10 or 15 years ago, and that such a simplification and consolidation of the insurance system would be generally welcome and would facilitate administration. Meanwhile, we have available in the Bill an instalment of reform, and I congratulate the Government on having introduced it.
§ 8.45 p.m.
§ Sir John Withers
I would like to join in congratulating the Minister on this excellent Bill, but I am sorry that I must raise one point of criticism. I have had a large number of letters from my constituents. A great number of women are 458 educated at Cambridge, and go out into the world to take independent positions, and I have been inundated with letters and representations from societies of these ladies on the omission from the Bill of women earning between £250 and £400 a year. The Minister in his opening speech was excellent and explanatory on all subjects, but his explanation on this particular point was, I thought, rather technical and difficult for the ordinary person to understand. I do not think that the ordinary Member who is not given to actuarial figures and considerations of that sort would easily understand it. Although many of them were undergraduates at Cambridge and took their degree, they are not people who would naturally understand that sort of thing. They are very likely classical people like myself, or they might be moral science or historical people, and they would not understand actuarial matters. I suggest, therefore, that in winding up the Debate to-night the Parliamentary Secretary would be very kind if he would make the explanation on rather more popular lines, so that my constituents should not fail to have a clear view of why they have been omitted from this Bill.
I have taken the trouble to get the points which they want elucidated so that the Parliamentary Secretary may have them. The questions they ask are these: (1) Do the women whose incomes are between £250 and £400 really need any help from this scheme? (2) Can it be expected that women could save sufficient from an income within these limits to make provision for old age? (3) Can it be expected that a widow with dependent children could save sufficient from such an income to make provision for the children in the event of her death? The points that I have been asked particularly to stress are these: That the women who are earning salaries are often called upon to support parents, and to help with the education of younger members of their families; that a woman has greater difficulty than a man in retaining employment after middle age; that a woman earning £250 is less likely than a man earning £400 to rise to a salary so high as to make the help offered by this scheme unnecessary; that a woman's expectation of life being longer than a man's, women on the average have a longer old age to which to look forward; that many of these women are widows 459 with dependent children. These are the questions and points which I have been asked to bring to the attention of the Minister, and I shall be grateful, not for myself, but for the various people who have corresponded with me, if the Minister can explain the reason for the omission of these ladies in popular language so that they will be able to understand it.
§ 8.50 p.m.
§ Mr. James Griffiths
The hon. Member for Westhoughton (Mr. Rhys Davies) said earlier in the Debate that this country was daily becoming more pension-minded. If I may state it in other language, I would say that the people of this country are day by day becoming filled with a sense of economic insecurity. It is an indication of the insecurity that prevails not merely among manual wage earners, but among the classes to whom this Bill specially applies, that we should have this demand for a pension of 10s. a week at 65 years of age. An hon. Member on the other side waxed very lyrical because a Bill of this kind with its commitments of the Treasury of something like £1,000,000 a year, was only possible because we had a strong National Government which had restored prosperity. [HON. MEMBERS: "Hear, hear."] Hon. Members cheer. There is so much prosperity that professional people want to be sure that they have 10s. a week at 65. That is sufficient commentary upon the security which the capitalist system provides. This problem of economic security, this fear of old age, is growing as the present system becomes more mechanised and rationalised. Large numbers of professional people, such as clerks, managers and salesmen, have been displaced and thrown out of employment. In a town like Swansea 20 years ago, before the coal mining industry was rationalised, you could find 100 offices, each one selling coal and employing black-coated workers. Now they have been squeezed out by rationalisation. We on this side sympathise with these people who have been the victims of this system and who feel the dread of economic insecurity, and as far as this Bill meets their claims we welcome it.
We want, at the same time, to supplement the appeal that has been made by several speakers on both sides that the 460 time is overdue for a comprehensive survey and overhaul of our system of social insurance. For a long time, beginning in 1912 when the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) began with health insurance and unemployment insurance, we have passed a long list of Bills, one on top of the other. They all deal with a great social problem. It is one problem —the problem of providing against the contingencies that destroy the livelihood of the people. It is one problem and not a series of problems. With all this legislation we have all kinds of absurd anomalies. A man who may lose his livelihood by accident may get 30s. a week. If he loses his livelihood by illness he gets less. If he loses it through economic depression he gets another sum. All these are one contingency, however; they are one risk, the risk of losing livelihood. We ought to be able to develop a social insurance system that will guarantee to a man and his dependants a sum that will give him a livelihood, irrespective of the cause by which he lost it.
I join in the appeal that it is time we had a comprehensive survey for the working out of one system of social insurance. I have said very often that if all the money that is deducted from wages and the money which people pay to all kinds of societies on Friday and Saturday nights were collected into one State fund, I am positive it will be found that the workers are contributing such sums as would enable them to get a decent old age pension on which to retire. The time has passed when we should keep passing one piece of legislation on top of another. This Bill will create anomalies. We bring in a Measure to remedy an anomaly and it creates a new one. People will be left outside the scope of this scheme. The hon. Member for Aberavon (Mr. Cove) pleaded for teachers who will be outside by a matter of £8 by reason of the Burnham scale of salaries. It all shows the urgent need there is for a comprehensive survey and a building up of a real system of social insurance, and I join with the hon. Member for Westhoughton in hoping that if the time does come—and I believe that it will come sooner than hon. Members opposite think—when our party sit on the benches opposite, this will be one of the first services which we shall nationalise. This is a real social service, built upon social credit and social faith, 461 and it ought to be one of the first services to be nationalised, because I am convinced that the amount of money paid already for insurance would be adequate to cover the cost if it were properly administered.
Partial as this Measure is, it is the first fairly major Bill dealing with old age pensions, and that being so I regret that the Minister of Health and the Government have not taken advantage of the opportunity to deal with one of the grave anomalies under the existing contributory pensions system, the anomaly by which a wife does not qualify for a pension until she becomes 65. Every hon. Member knows of pathetic cases which come under that head. At 65 a man is likely to lose his employment. Even at the age of 55 a man who gets out of a job finds it very difficult to secure fresh employment. If he is out of work for 12 or 18 months the process at which he works has become so revolutionised in the interval that if he does get back into work it is almost like taking up a new occupation. I have heard Members say, and the statement is being made in the Press, that there is a shortage of miners in certain districts. Why? Because no coalowner will look at a man over 45 years of age. The men of 45 or 50 are too old to stand the pace. The age of 65 is really long past the age at which men are now being compelled to retire from industry, and the Government ought to have taken advantage of the opportunity which this Bill presents to deal with the problem of those men. What would it cost? It would be only a trivial sum compared with the amounts which we shovel out for all sorts of purposes.
Only last week I came across a case of a man who had been unemployed for several years. He and his wife had been receiving 26s. a week, but for the crime of becoming 65 he has lost that 26s. When you reach the honourable age of 65 you cease to become chargeable to the Unemployment Insurance Fund and go on to the Old Age Pension Fund. Instead of 17s. a week the man now gets only nos.—a wonderful reward for old age—and his wife, because she is only 62, does not get a penny. Therefore, in place of the 26s. all that that couple are receiving now is 10s. a week. That old man and that old lady, who had given a lifetime of service to this country, were 462 for the first time compelled to endure the bitter experience of going to the public assistance committee. The Government have missed an opportunity there of rectifying one of the gravest anomalies of our social insurance system.
Because of the existing insecurity there is now great competition to get within the terms of this Bill. All kinds of people want to come in. Already questions have been put about the age limit, but I gather from the speech of the right hon. Gentleman in introducing the Bill that it looks pretty hopeless to try to get the age limit raised beyond 55. I wish to put another case. In the areas where there has been industrial depression there are numbers of men who were once in insurable employment but who, after a year or two of unemployment, gave up all hope of being able to get into insurable employment again and started upon jobs on their own. Some of those men had worked in the pits and for eight, 12 or 16 years had been contributors to all the pensions schemes, including the contributory pensions scheme. They contributed far more to social insurance than they ever got out of it. Then they went out of insurable employment, as I have explained, and now, if they happen to be over 55, they are not able to come into this scheme as voluntary contributors.
Is it possible for the Government to make a concession to men in such circumstances? Could such a man over 55 years of age be accepted under this scheme if he could prove that for a certain period he was a contributor towards insurance? I think there is a case there which the Government should be able to meet. Suppose they were admitted on the basis that every five years' contributions as a compulsory member would cover a year's extension of the age in the case of the man over 55. We bring into the scheme people of 54 years of age—good luck to them—who have never been in insurable employment before and have never contributed a penny, and shall we throw out the man of 56 who has contributed towards insurance for perhaps 15 or 20 years? I plead for consideration for these men who have contributed towards health insurance and unemployment insurance and, in some cases, towards the contributory old age pension scheme.
Further, where a man is over 55, if his wife is under 55 will there be an 463 opportunity for her to insure for a pension? The man being over 55 cannot pay a contribution to cover the two of them, himself and his wife, but suppose his wife is 52, can she join the scheme and buy an old age pension for herself? I stress these cases because, like all hon. Members who represent mining divisions, I know of many men who worked hard until they were driven out of employment in the mines and so were driven out of insurance, and who have since taken on little jobs and who are now 56 years of age. I feel that such men, with a record of five, 10 or 15 years of insurance, ought to receive consideration in this matter. Finally, I say that we welcome this Bill, but we regard it only as another brick added to a building which we think is becoming very ugly, because it needs reconstruction; and we hope the day is not far distant when the whole system of social insurance will be surveyed and co-ordinated and made worthy of the people of this country.
§ 9.5 p.m.
I should first of all like to add my congratulations to my right hon. Friend on the introduction of this Bill, which, I am certain, will bring benefits to a very large number of people and will be warmly welcomed throughout the country. I would also take the opportunity of saying how much I regret that, up to the moment, the Government have not seen their way to meet the case of the man who reaches the age of 65 and whose wife is some years younger than he is. I think the Parliamentary Secretary will be well aware that the case of this class of people and the implementation of a pension for the wife of earlier age have been fought for by the party to which he and I belong. I regret that we have not received that sympathetic consideration that we should like. I know there is no possibility of obtaining such a concession in the Bill, but this is an opportunity of advocating the case. I feel strongly on the fact that we should be getting thousands of men who have been of inestimable value and benefit to the country, who have a first-class industrial record and who have never been a drain upon the resources of the country, but who, at the age of 65, are no longer able to follow their employment and, for the first time in their lives, are sent to 464 the public assistance authorities to obtain a small sum of money for their wives. The case deserves the consideration of the Government, and although I am particularly glad to support the Bill to-day, this is an excellent opportunity to advocate the case, and I hope that my hon. Friend will take note of it.
I hope that every opportunity will be taken on the lines of publicity for the people who have only one year in which to exercise their right to take advantage of the benefits offered by the Bill. Publicity is the most important thing. I cannot think of anything more tragic than that the years should have elapsed and that a man or woman should realise that the provisions of the Bill are not available to them. I am not certain whether the Ministry of Health realise how inadequate sometimes is the information available for people who come within the scope of the various National Health Insurance measures. I feel that strongly with regard to people who have exhausted their right to National Health Insurance and contributory pensions and who are turned off these schemes because of prolonged unemployment. If there had been more publicity in the industrial areas, and more advice to them about what they were likely to lose by failing to keep up their contributions, and as to the steps they ought and could take to keep themselves in insurance, a great number of the human tragedies would have been avoided. I hope that my right hon. Friend will see that as wide publicity as possible is given to the Bill.
I turn to another controversial point, relating to women workers. I shall not go over all the points, which were made admirably by my colleagues, but I want to add one or two other points. I agree with what has been said about differentiation of income, but I cannot help feeling that my right hon. Friend did not take the fullest opportunity to explain exactly why the Government had decided to make that differentiation. Probably the Government would have been wiser to have announced their intention a little earlier. The matter is very technical, and if there is an explanation—and I hope there is a better one than we had earlier in the Debate—it would be wise if we had an opportunity of hearing it earlier so that we might understand the whole facts of the case. So close has my right hon. Friend been about this subject that it 465 makes me all the more suspicious that the explanation is not entirely satisfactory.
I want to raise a specific case. My right hon. Friend mentioned in his speech that the Bill was designed to meet the case of the dressmakers and the music teachers. They typify a section of the community who have had very little done for them in the way of social services. We very much welcome the opportunity that those people will have. I think that the argument was that after a woman had had a greater income than 250 she ought to be in the position of having saved for her own old age through ordinary channels. My right hon. Friend did not make that point particularly clear. He referred to the is. 6d. for which you can insure for a pension at 65, but I do not think he made much reference to the age factor. He did not give us the case of the woman of 40, 45 or 50. I gather that it would be very much easier to provide for old age if you started at 35. Suppose a dressmaker or music teacher is earning £6 a week at the age of 45; she will be barred from the benefits in the Bill. A music teacher or dressmaker takes a long time to build up a connection. Theirs are not occupations which you can go into and make a large income very quickly.
In my own part of the world, dressmakers and music teachers of reputation have had a difficult time during the period of the industrial depression, and they have not had much opportunity of earning £250. Now, when times are getting better, you may find that they go suddenly into the category of people earning more than £250; you may find them getting into the category of earning £6 per week, which would bar them from the Bill. It seems hard that these people who are earning £6 a week should suddenly be regarded as being able to save sufficient between the ages of 45 and 65 to provide themselves with the benefits that they would have been able to get had they been only in the category of £250. You get the anomalous position that it would be probably very much better if those people were to refuse orders for dressmaking and refuse to take pupils, so that they might qualify on 1st January, 1938. I suggest that that case ought to be considered. I hope that the Minister will consider it in the light of all the representations that have been made.
466 I come now to a further point. I always try, at any rate, to keep an open mind, and it may be that, when my hon. Friend comes to reply, he will elucidate this very peculiar and unfortunate situation; but if he elucidates it to such an extent that he feels that he has a perfectly good and sound case, then I would try another form of approach, and that is to see whether it would be possible to obtain a concession. The concession I would suggest is that this class of women, with incomes between £250 and £400, should be allowed the same concession that is being made to men and women of 55, and that they should be given one year in which to come into the scheme if they so desire. I am not now talking about the inequality of the sexes, but about the practical details of the scheme. If they were all allowed to come in, that would at any rate remove a grievance from a considerable number of people in the country. Then, if everybody else in the categories covered by the Bill came into insurance in the future at an early age, there would be at that early age fewer women who were earning incomes of over £250, so that thereafter all those who wanted to take advantage of the scheme would be covered. It seems to me that I am offering a very good "get-out" for the Government, and I hope they will consider it. If it is argued that a very small number of people will be prejudiced by this differentiation of income, that is an equally good argument for my concession, and I think that at any rate it would meet our views so far. It does not, of course, meet the fact that the Bill promotes sex inequality, but it would at any rate meet the grievances of people who are going to be prejudiced, and I hope that my hon. Friend will consider it in that spirit.
Those of us who support the Government have always been ready to believe that the Government believe in equality. I do not count myself a feminist. My political career and life have been spent in terrific industrial fights from the point of view of electioneering, and I have always been, so to speak, on the industrial side at every stage in my career. Therefore, I am not what is naturally termed a feminist. But there are occasions when one feels that it is a good thing to put the woman's point of view, and so I would end on this note. I have always felt that the Government believed in equality, and I can very well remember, 467 when we have tried to get provisions inserted in certain Bills that there should be a woman magistrate, a woman included on a commission, and so on, the clever arguments that were put forward from the Government Front Bench to the effect that it was a pity, in these enlightened days of progressive civilisation, to dwell on sex inequality, that there really was sex equality, and that for the future we ought to drop mentioning either men or women in Bills, and to assume that this country regards women in the same category from the point of view of efficiency as men. So we have been persuaded on occasion not to press for the specific mention of a woman as a woman, on the ground that we believed in equality and women would get their chance in the ordinary way. It is, therefore, rather disappointing to find that a completely new Bill should go in for this sex disqualification. I hope the Parliamentary Secretary will find it in his heart to think over the points that I have raised, and, if we cannot get the whole thing, to see whether he can grant us this concession.
§ 9.22 p.m.
§ Mr. Stephen
I must confess that I was very disappointed when this Bill was introduced. I looked for something better from the present Minister of Health. The Government appear to me to have lost a great opportunity in connection with this question of pensions. I appreciate that provision is being made for so many of the black-coated workers and people whose incomes are such that they are not able to come under the ordinary scheme; but it is also, I think, within the knowledge of the House that there are many anomalies in the other scheme which the Government should have taken the opportunity of correcting at the present time. One of the reasons why I intervene in this Debate is that I am sure that all Members in the House must have been terribly worried from time to time because of cases that have come to their notice through constituents in which widows were unable to get their pensions because of the lack of a few contributions, owing possibly to circumstances such as often arise in connection with unemployment. I wish that the Ministry of Health, when they were dealing with this matter, had had some concern for the recasting of the old scheme so as to make conces- 468 sions which would obviate many of the tragedies in connection with the present system. The Government, however, have not seen fit to do that, and I feel that the country will think all the less of the Government on that account.
There is another point that I think is worth mentioning again. I listened to the previous speaker with great interest, and I agree that the difference which is being made in the treatment of men and women in this Measure is perfectly shocking. I think it is scandalous that the Government should put this additional hardship upon women in connection with the pension scheme. Women have to pay their taxes, to pay their rates, to make their contributions, just as everyone else in the community does, and yet the Government are imposing here a penalty upon them because they are women. I certainly join in the protest, and I hope that the pressure upon the Government will yet be such that this differentiation between the sexes and this hardship upon the women will be obviated by the giving of equal treatment to men and women in this Measure. There has been a good deal of agitation in the country with regard to the treatment of spinsters under the old Measure, and, frankly, the present hardship which is being imposed on women is on all fours with the unfair treatment that women seem to have got all along in connection with National Health and pensions schemes.
§ Mr. Stephen
Yes, and unemployment insurance. In a country like Britain the men are supposed to be chivalrous and considerate with regard to the women but it seems as if their chivalry departs when it comes to giving the women social justice and they are always anxious to get a bit more for the men. I believe that if this Government had been courageous enough in this Measure to provide pensions for spinsters at 55 the Bill would have been one of the greatest measures of social reform that they could have carried through, and I trust that in this connection there will be so much criticism of this Measure and so much interest aroused in it that the movement on the part of the spinsters for pensions at 55 will receive a great impetus, and that a Government in the near future will be compelled to do tardy justice. I hope that the solitary 469 representative of the Government on the Front Bench will convey this further point to the Parliamentary Secretary. For entry into the scheme there is an age limit of 55. The point I wish to stress is that there are many people who were under the old scheme who dropped their insurance or lost their insurance and are now possibly a little over 55. I have had correspondence from people with regard to this matter. They find that after having sought during years to get within the pension scheme they are now to be shut out by this age limit of 55 years.
There is a Government subsidy in connection with the working of this scheme. That means that everyone who comes under this Bill is to get a certain gift from the taxpayers of the country. They are to get so much public money. Why should others who are possibly 56 or 57 be treated as if they were step-children and be cut out of the will? Why should there be an age limit imposed in this way? When the Bill comes into operation a person who becomes 55 the day before will be left out. Another person whose birthday is two days later will be in. I know it may be said that you have got to have limits. I remember there was an extraordinary provision put in the 1925 Act that those who became widows before 4th January, 1926, were put into a much worse position than widows whose husbands lived a little longer, and it seemed to me often as if the State regarded those women who could not keep their husbands alive the extra day or two as criminals and subjected them to a great penalty as compared with the others. People who have had a former insurance and made many contributions and are now over the age of 55 should be enabled by some provision to come into the scheme. I hope that the Minister will be able to make a concession in this respect.
I would like also to make this appeal. It is a great pity that when legislation like this comes before the House so much is put there not on a basis of what the majority of Members of the House want but on the basis of what the officials and the Minister responsible think is all that is possible. Always in the background there is the Treasury, and the Treasury in the background always seems to have a very chilling effect on the generosity of even decent, well-intentioned Ministers. I would suggest that the Minister should make this Bill a matter which he puts 470 fully at the disposal of the House, so that this provision shall be the provision which the elected representatives of the people desire. It is quite true that there may be financial difficulties and all the rest of it, but I would suggest that these financial difficulties should be put to the House with regard to Amendments that are put down, and it should be left to the responsibility of the House without the Whips being put on. I remember when the Labour Governments were in office in 1924 and 1929–31 there was always the difficulty with regard to financial considerations. When some of us in the party were pressing for improvements and had the support of the majority of the party, very often financial considerations were said to make it absolutely impossible for these things to be done. In spite of the figures that were given, the majority were not convinced.
I hope that Members on all sides of the House will have many suggestions to make as to how the Bill could be made more generous and more satisfactory and how many of the anomalies within it can be corrected. I wish we could get a new precedent made by allowing greater liberty to Members to improve the Measure. To my mind the great weakness of the whole scheme is that there is this terrible problem facing so many old people in very poor circumstances, that they are denied pensions when they should be put on a proper pensions basis. Nothing is being done to obviate the hardships under the former scheme. Nothing is being done for the spinsters, women of 55 who have lost their employment and have no hope of getting into employment again, and who should be upon the pension system of the country. We should have an assurance that the Government will go into the question of the pension system and do something to correct anomalies. I also hope that, as the Measure proceeds through Committee, the Government will be able to accept many Amendments, making the scheme much sounder and more hopeful for so many of the people of the country.
§ 9.37 p.m.
Mr. Vyvyan Adams
As I have listened to the whole of the Debate, with the possible exception of three-quarters of an hour, it is a little difficult to know precisely where to begin. The comparative moderation of the early part of the 471 speech of the hon. Member for Camlachie (Mr. Stephen) reinforced to a large extent the compelling and forceful arguments of the hon. Member for Wallsend (Miss Ward) against differentiation. I, too, regret the differentiation between the sexes which is evident in the Bill, but my mind is not quite so open upon this matter as that of the hon. Member for Wallsend. I shall be interested to see precisely how she and others are answered by the Parliamentary Secretary. The House has grown to respect the passionate eloquence of the hon. Member for Llanelly (Mr. j. Griffiths), who pleaded for the nationalisation of the whole system of pensions. I do not share what is no doubt to him the sanguine view about the early advent to power of the Labour party, but, as he did not tell us why in his opinion they are likely to come into power soon, there is, I dare to think, no reason why on this occasion at least I should tell him why they will not.—[Interruption.]—We will join issue with the greatest possible pleasure on some more appropriate occasion.
I wish to support the hon. Members for Central Edinburgh (Mr. Guy) and Cambridge University (Sir John Withers);n their remarks about differentiation, and I am grateful to the hon. Member for Frome (Mrs. Tate). I thought her speech was a very effective reply to the hon. Member for the Scotland Division of Liverpool (Mr. Logan). I cannot emulate the moral uplift to which he referred, nor can I understand his nice and elegant distinctions between the sexes which are so completely hidden from the rest of us, nor was I able to follow everything that he said; in particular two sentences mystified me. The hon. Member said, "It is a question whether under the law of equity you should not grant compensation or take over the thing holus-bolus. I think," continued the hon. Member, "I am presenting the thing fairly and clearly." No doubt it was clear, fair and square TO him as, in his own words, he "brought the illegitimate into the legitimate channel." What is important to many of us is that the Bill means the redemption of an electoral pledge. Perhaps 18 months is a longish time for some of us to have to wait, but the eventual fulfilment of a promise is a good deal better 472 than its denial or its repudiation. I thank the Minister of Health, and bearing in mind his proved ability to carry out his policy or the Government's policy, I regret that in the autumn of 1935 tie was not carrying the portfolio for the Post Office in his left hand, and in his right that of the Foreign Office. It would have been a rare and refreshing spectacle, and perhaps the "general taxpayer" cited by the hon. Member for Faversham (Mr. Maitland) would then he able to sustain an even more ambitious programme of pensions.
On the Second Reading we are at liberty to regret omissions. Why is there not the fullest possible equality of treatment for the sexes? We have heard no explanation of this remarkable discrimination. In particular I was struck by the speech of the hon. Member for Faversham, full of eloquent reflections and recollections, but beginning with a premise which I did not understand. He said the responsibilities of the two sexes are different. Their functions may be—the hon. Member for the Scotland Division knows that—but the whole tendency of our contemporary life is to equate their responsibilities. Having fully considered all that the Minister had to say upon this matter, I still think that women are unfairly treated, not in the bulk but as individuals. I wish to plead, in particular, for the claims of spinsters, who have been pressing their claims with an importunity which is, I believe, Biblically identified with widows. But I recall that the importunate widow was eventually successful, and I do not say that importunity qua importunity is necessarily to be deprecated. Many interests are importunate in the House and in the Lobbies outside.
A Government, particularly a National Government, enjoys pressure. The Lord President of the Council, when Prime Minister, told a deputation from the Churches to go on pressing, and pressing, and pressing. [Interruption.] I am glad I am audible to the Labour party. But I want the spinsters in particular to take note. Long may they press! But I hope they will not have to press too long. For their claims are not in fact exorbitant. If necessary and, to be within the Rules of Order, I would advance that claim upon the footing of adjusted contribution, although I deny that that is necessarily a fair basis. On 21st February, 1935, the Chancellor of the Exchequer, 473 in reply to a question from my hon. Friend the Member for Central Edinburgh, said:The cost of granting contributory old age pensions at 55, instead of at the present age of 65, to unmarried insured women would be an additional £4,500,000 a year. I could not without prolonged calculations indicate what increase of contributions would be necessary to cover this extension of pension rights, and I hope that in the circumstances my hon. Friend will not press this part of his inquiry."—[OFFICIAL REPORT, zest February, 1935; col. 524, Vol. 298.]Neither the Chancellor of the Exchequer nor the Minister of Health is an unkindly man. Four and a-half million pounds is, of course, a considerable sum. In former days, certainly in terms of pre-War Budgets, I believe it would have been regarded as almost an astronomic figure. But I think it is relevant to recall the sums we are spending to-day on other objects. If, for example, we can find so much to attain what I dare to think to be the very necessary ends of defending ourselves and repairing the shattered foundations of general security, surely we can do this service to lessen the rigours undergone by ageing women. Their lot is a peculiar one. The sexes are not numerically equal in this country. These women belong to the majority. In the nature of the case they cannot expect to marry or have very little prospect of marrying and so of enjoying the warmth and companionship of a home. Until the age of 65, right on through middle age, they are doomed to-day to a cold and toilsome loneliness. If the Government like, this entirely unenviable plight can be redressed by them. Yesterday the President of the Board of Education, in one of the noblest and most striking speeches I have heard for months, remarked on the kindliness that was to be observed in our national life. Here the Government have a chance not only to exhibit the rudiments of kindliness but the elements of chivalry as well.
§ 9.48 p.m.
§ Mr. Arthur Greenwood
I have no doubt that this is one of the right hon. Gentleman's bright days. He has had the privilege of introducing a Bill which brings some comfort to people who have been outside the existing scheme, and for that reason I and my hon. and right hon. Friends will not oppose this Measure, not that we would agree with all that he has done. My first complaint 474 about the right hon. Gentleman is that now, having had time to consider the broader problem, he has chosen to introduce a Bill of such a narrow scope. We have had a good deal of experience of pensions ever since the Act of the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George), extended on one or two occasions since. We have now gathered a volume of experience about pensions which we ought to relate to the situation to-day. That situation is one which has been recognised on all sides of the House. We have more man-power than we can usefully use. It is possible to produce all that this nation requires for its needs with a far smaller labour army than ever before. One way to get out of the difficulty of having too much labour is to relieve people of the responsibility of wage-earning a little earlier than is the case at the present time. Although we are thankful to the right hon. Gentleman for this small Measure, I hope that he will crown his career by a Bill of much larger magnitude.
There are one or two points to which I would ask the attention of the Parliamentary Secretary. I realise that the Bill as drawn makes it difficult for us to move the kind of Amendments that we should like to move. The first question which has been referred to in the Debate to-clay on more than one occasion is that of the people over 55. I realise the difficulty of establishing an age limit. Whatever age limit you may put into a Bill, the people who are just outside it are bound to complain, and there is no escape. If the right hon. Gentleman had said 50 instead of 55, the people who were 51 would have been just as vociferous as the people who are now 56, but the right hon. Gentleman, having admitted the right or the moral claim of ageing people to a pension at 65, might have devised some scheme which would have permitted people who were above the age limit to take advantage of the benefits. There are people who are 56, people who are 57, people who are approaching the age when their positions are becoming in jeopardy, people whose cases are just as hard as that of the people who are now 54, and it is a matter for the consideration of the right hon. Gentleman as to whether he could not make some provision for people who are now over 55, so that on attaining 475 the age of 65 they could, by having made the appropriate contributions, take advantage of the provisions of this Bill.
There is a further point. There are people who have never been in the insurable class who may, as soon as this Bill becomes law, enjoy its benefits. There are people who have been in the insurable class and who have perhaps over a period of years paid contributions who are now outside it. Is there not some method whereby these people for whom the original Act was intended should be able to come back within the fold of the right hon. Gentleman? There is the case of the wife of a man who was in the insurable class and who for one reason or another is now not in the insurable class. Is it not possible for the right hon. Gentleman to make some arrangement whereby the wife might become a voluntary contributor under this scheme? I realise the difficulties with which the Minister is faced, the difficulties with which I was faced in 1931 when I was dealing with widows of 55 and over, and also the difficulties in which the right hon. Gentleman tried to place me, and would do so again. If he feels as I do now, and as he did then, I think he might have some regard for those people who are now over 55, for whom some provision ought to be made, and might be made, and which I think would meet with a response from people who are now drawing near the end of their industrial life. It might be done by increased contribution, or it might be by the insertion of provisions in regard to their previous insured position. I know the difficulty of dealing with these matters in Committee, but everybody feels that these people ought to be dealt with. I should like to know whether it would not be possible for the right hon. Gentleman to devise some scheme whereby people who are just past the arbitrary age of 55 might be brought within the scheme.
My second point is one that has been emphasised to-day by the superior sex in this House. I realise that there may have to be a differentiation between the salary scales of men and women, due to the fact that generally husbands keep wives and very few wives keep husbands, but the House ought to have a little clearer explanation of the reason why the right hon. Gentleman has fixed the maximum salary for men at £400 and for women at £250.
476 I listened with interest and eagerness to the right hon. Gentleman but I do not think that his reasons were very convincing, and r am hoping that the Parliamentary Secretary will try to justify the great distinction made between £400 and 250.
Now I come to a point which is rather more technical in character. Certain apprehensions have arisen and have been voiced to-night about the effect of the scheme. I regard it as a fundamental principle of Government that where you are developing the law you should not prejudice the rights or claims of people who have already enjoyed certain rights. That seems to me to be very important. I had hoped that the Bill did not prejudice the claims either of persons or of organisations, but I now understand from the Minister's speech which, again, was not crystal clear, and from a further reading of the Bill, that the excepted classes of persons, the people who, broadly speaking, will profit more by this Bill than anybody else, may be in certain respects prejudiced. The position to-day, as I understand it, is that a person who is in excepted employment can become a voluntary contributor under the principal Act for all purposes except medical benefit. The question to which the House ought to have an answer from the Parliamentary Secretary is whether, after the passage of the Bill, persons in excepted employment will be debarred from becoming voluntary contributors under the principal Act for all the purposes of that Act? If that be so, then it seems to me the House is in danger of doing an injustice in depriving people of rights that ^-hey already possess. I am sure that the answer is a perfectly clear one, but it would help us if the Parliamentary Secretary could give us an assurance.
There is a further question arising out of the same problem. Present voluntary contributors who have enjoyed these rights for many years and who wish to remain as they are now, have under the Bill, as I understand it, to declare within a specified time their intention to remain where they are. That seems to me to be an inversion of what ought to be the rule. There is on the Statute Book the Trade Union Act. The original Trade Union Act, passed by a Government, not of my political complexion, arranged for people to contract out if they did not like to join a certain political party. The 477 right hon. Gentleman's Government reversed that and put an obligation on people to contract in. I believe that to be an entirely wrong principle. I should like to know from the Parliamentary Secretary whether it is a fact that under this Bill people have to contract in within a specified period. If not, they become automatically excluded from some of the benefits of the Bill. The point at issue is whether the Bill will detrimentally affect certain approved societies, because it this contracting in or contracting out Clause is operated certain approved societies will be prejudiced and may in time have to dissolve themselves.
I would ask the Parliamentary Secretary to deal with some of the questions which involve money and which cannot be dealt with after the Second Reading of the Money Resolution. There is the question of people who are over 55. Once we have passed the Money Resolution I am afraid it may be hopeless for us to do anything further, but at this stage we are entitled to know whether the Government are prepared to make any arrangement to deal with the hard cases of persons who happen to be over 55, even if it may mean an increase in their contributions and the arrangement of special conditions in regard to the terms of their employment. We hope that some arrangement can be made whereby these ageing workers can be brought within the scope of the Bill.
§ 10.4 p.m.
§ Miss Wilkinson
I am sorry that I have had to be absent during part of the Debate. I want to join in the protests that have been made. I cannot join the chorus of praise about the Bill that has been directed towards the right hon. Gentleman. I realise that there is a good principle in the Bill, and I am glad that new people are to be brought in, but I may perhaps be forgiven a little bitter smile, as representing one of the most distressed areas, when I see the difference in attitude of the Government towards the workers under this Bill and the people with unearned invested income, and their attitude when we are discussing miserable little sixpences and shillings doled out to people under the means test. In this Bill the Government are dealing with a section of workers that it expects to be its supporters. One is glad to see any section of the community needing it brought under the benefits of State aid.
478 I want to deal with the question about which the women Members of the House have shown deep feeling and about which organisations of women outside the House have also made special representations. I suppose the Minister who is going to reply will again say what the right hon. Gentleman said as to the question of sex not having entered into consideration in relation to the fixing of the income limits. The right hon. Gentleman said that it had been decided in view of the difference of burdens. I hope he will not say that again. It is obviously not true. It is difficult for us to sit patiently while these statements are made which everybody knows are not true. It is impossible to divide people into categories of need if you want to, but in this particular case you have taken a rough-and-ready division which is just a conventional way of dealing with the matter. All the way through the Minister's speech there is the assumption that the man has always to provide for his wife and family. I, as an unmarried woman, find it amusing to observe the way in which the male sex assumes that the wife is invariably and eternally a burden. A wife can be an economic asset, and, after all, the unmarried woman worker has to have someone to do domestic work that the married man gets done for nothing. That is obviously useful work which the wife does. But there are large numbers of men who have married women who have an equal amount of unearned income, or who may themselves have jobs or some other resources. But if they are earning, say, £260 to £300 they are outside the benefit of the scheme though they may have relatives dependent on them. There seems to be an assumption that a woman earning £250 or more is a sort of millionaire who can provide for her relations. A census taken by the Association of Business and Professional Women shows how large a percentage of such women have relatives actually dependent upon them.
Suppose—I admit that this is a large supposition—that everything that the Minister said was true, the fact remains that this is a quesion of principle which concerns not only business women. Here we have a country where the women have nearly complete equality in citizenship, where the women are taxpayers and have to do a great deal of the paying into the 479 particular funds needed for this scheme. Yet on this question of insurance you take into consideration the perfectly vicious principle of sex differentiation. I had hoped the Government would say that when it was dealing with the citizens of this country it would deal with them as such and not divide them up conventionally according to sex. The Government does not realise what a very large proportion of the organised professional and working women are bitter about the application of this vicious principle. There is no reason whatever why women should be stamped as inferior persons in this way. They do their job and do it well; they pay their taxes and take an interest in the affairs of their country; they keep its laws and accept its burdens, and they have every right to be treated as citizens. This phase of the Bill is so pettifogging. The amount of money to be saved is trifling when compared with the amounts which we are asked to vote day after day for all sorts of things. The differentiation puts upon women a humiliating inferiority. It is unworthy of this Government and I hope that, rather than save the few odd thousands of pounds involved, arrangements will be made to put this matter right and treat citizens on an equal footing.
§ 10.14 p.m.
§ The Parliamentary Secretary to the Ministry of Health (Mr. R. S. Hudson)
My right hon. Friend the Minister of Health is entitled to feel very gratified at the course of the Debate and the almost universal praise that has been accorded him for his introduction of the Measure. The right hon. Member for Wakefield (Mr. Greenwood) asked me to deal with two particular points—namely, the excepted classes and the question of women, but before I do so may I be allowed to clear up one or two points which have arisen during the course of the Debate? The hon. Member for Westhoughton (Mr. Rhys Davies), who opened the Debate, said that the people had expected bread and that the Government had given them a bone. My only comment on that is that it is an extremely meaty bone, in fact there is so much meat on the bone that you cannot see the bone for the meat. He also suggested that the Government had been singularly niggardly in dealing with pension and insurance, and that neither in the larger scheme nor in this 480 had they made a contribution towards the general liability worthy of the Government or of the needs of the scheme. What are the facts? The liabilities of the wider scheme were estimated in March, 1934, at a total of £1,850,000,000, and of that the Government are assuming £1,200,000,000, leaving contributions to represent £650,000,000. In other words, the Government assume two-thirds of the liability for benefits. Under the present scheme the total liabilities, on the estimate made in the Government actuary's report that 350,000 persons will join the scheme, represent about £49,000,000, and the Government's contribution represents £37,000,000 and income from contributions only £12,000,000. In this case the Government's contribution represents three-fourths of the total. It is quite imposible, in view of figures like that, to suggest that the contribution of the Government is other than extremely generous.
The hon. Member for Llanelly (Mr. J. Griffiths) asked whether it would be possible to do anything for men over 55, and also whether in the case of men who were over 55, and their wives under 55, it would be possible to allow their wives to become voluntary contributors. As regards the first question, I am afraid the answer must be that if you draw a line there are bound to be hard cases. One of the essential conditions of the scheme, if we are going to waive the medical examination, is that a reasonable waiting period should be imposed. A minimum waiting period of ten years is regarded as essential, and that brings you inevitably to 55, and I am afraid that I cannot hold out any hope of that age being altered. As regards the point whether in the case of men over 55 with wives under 55 it is possible to allow the wives to become voluntary contributors, that is an interesting suggestion, and is certainly one which between now and the next stage of the Bill we will consider.
§ Mr. Hudson
The hon. Member for Wallsend (Miss Ward) hoped that we should not overlook the need for publicity in this matter, especially in regard to people whose obligations are being changed. I can assure her, although she will hardly need any assurance, that my right hon. Friend, who was once Postmaster-General, is aware of the value of publicity. I can also assure her, as far as 481 I am concerned, that the experience I obtained as Minister of Pensions, when I saw the hardship inflicted on many of these insured persons because they were not aware of what steps they ought to take to get back into insurance after a lapse owing to a period of unemployment, convinced me of the need for publicity.
The hon. Member for Central Edinburgh (Mr. Guy) dealt with the question of spinsters, and asked why we had not granted their demands. My answer is that the spinsters' charter, which I have here, states on its first page two aims, the first being to obtain pensions for spinsters at 55 years of age and the second being to obtain a contributory pensions scheme for spinsters who do not at present come under the National Health Insurance scheme. It is clear that the Bill with which we are dealing to-night in effect grants the second of those two requests, and it is equally clear that a Bill dealing with a voluntary contributory scheme could not possibly deal with a reduction of age under a compulsory contributory scheme.
The hon. Member asked me whether certain figures which he quoted were correct. I could not follow his exact figures, but it is true, of course, that as regards the compulsory scheme, part of the contributions of a single woman go towards helping the general fund. That was done deliberately when the Bill was going through the House on the ground that the majority of unmarried women who enter industry at an early age expect in due course to get married, and it was felt to be only fair that their contributions should help to liquidate the burden when they, either as wives at 65 or as widows, possibly with children, would have to come on the fund. It is equally true—and it will be realised by hon. Members when they recall the enormous liability of the State for the general pensions scheme—to say that for the next 30 years no spinster who attains the age of 65 will have paid sufficient in contributions to equal the amount of benefits she will receive between the ages of 65 and 70, and, of course, over the age of 70 the whole of her pension will be at the cost of the State. I think I have dealt with most of the individual questions that were put to me.
I will now turn to the two wider points of excepted persons and women. I ought 482 to warn the House that the first is a very complicated question, and I apologise if I have to be slightly technical, but I will endeavour to make my remarks as simple as possible. The history of voluntary contributors in this matter is not uninteresting. In the National Health Insurance Act, 1911, provision was made for voluntary contributors, but that provision fell completely flat, and in 1918 so little advantage had been taken of it that it was decided to abrogate the provision. There was, however, the case of people who had contributed for seven years under the compulsory health insurance scheme, but who, as a result of an increase in their salary, were outside the limits and were no longer insured. In the case of those persons it was felt that it would me unfair to deprive them of the advantage of the whole of their years of contributions and it was, therefore, provided that anyone who had been compulsorily insured for two years, should, when his income went over the limit be allowed to become a voluntary contributor for health insurance. Again, that provision fell flat and when in 1925 we introduced the Pensions Bill it was found that during the whole of those seven years only 45,000 persons had taken advantage of the scheme to become voluntary health insurance contributors. I have nothing to say against the health insurance scheme, but it is interesting to see that the opportunity of becoming a voluntary contributor for health insurance made very little appeal indeed to the ordinary person.
Now we come to 1925. Then it was found necessary, for administrative reasons, to interlock the health insurance and pensions schemes and the question arose of what was to happen to the man who wanted to become a voluntary contributor. It was found impossible, for administrative reasons, to allow a man when he went above the £250 limit to become a voluntary contributor for pensions only. He was compelled, in addition to becoming a voluntary contributor for pensions, to become also a voluntary contributor for health insurance. Some hon. Members to-day, including the hon. Member for Ashton-under-Lyne (Mr. Simpson) and also I think the right hon. Gentleman the Member for Wakefield, used the term "enjoying certain rights." I do not know how that term can properly be 483 used when, in fact, a man was compelled by law to assume those obligations. The proof that what people wanted as voluntary contributors was pensions and not health insurance is found in the fact that whereas in the seven years between 1918 and 1925, 45,000 persons became voluntary contributors for health insurance, from 1926 to the present time 650,000 persons have become voluntary contributors for both. The implication, surely, is clear that what people want is pensions insurance.
We do not propose to take away from anyone anything which he enjoys at present as a voluntary contributor. Anyone who is a voluntary contributor to-day will have two options. He can either continue being a contributor for health and for pensions insurance, or he can become a contributor for one, dropping the other. If he becomes a contributor for pensions purposes, he will be entitled to continue as a voluntary contributor for pensions at his old rate of 11d. a week instead of at the rate of 1s. 3d. mentioned in the Bill. That is the explanation of contracting in and contracting out. The Bill provides that a person, within the period specified, must decide whether he wants to remain under the present conditions or not. If he does not make known his wish he will automatically come under the new conditions. The reason is not that we wish to deprive him of any right which he enjoys, but because we believe the new scheme is more favourable to him than the old one.
In the first place, as I say, he will continue at the old rate of 'Id. instead of at the rate of 1s. 3d. Under the old scheme, if his contributions in any year fell below 45 he automatically ceased to be a contributor and had no further rights. Under the new scheme he will continue to be a contributor provided his contributions do not fall below 26; but even if he ceases to be a contributor because his contributions fall below 26, the following year he will still have the right to make up his back contributions so that in two years he would have a minimum of 26 a year. If he fails to do that, he will still have the right under the terms of the Bill to certain pension rights for himself and his widow. Therefore, the terms of the new Bill are obviously, from that point of view, better than the existing terms. It is 484 true that in order to obtain a pension at the full rate, he will have to carry out the terms of the Bill, namely, to have an average of 50 contributions a year instead of 45 as at present. As a set-off against that, whatever his contributions may have been in the past, he will be credited in the books of the scheme with contributions at the full rate of 50 for every year since he came into the scheme. That is a great advance. These are the two choices a man will have to make, and we think that, on the whole, the second is the more favourable. If he chooses to remain under the old scheme, however, he has full right to do so.
§ Mr. Rhys Davies
The hon. Gentleman has dealt with this very technical problem as affecting the 650,000 persons who are now in for health insurance and pensions. Will he carry us a little further? Is it intended to provide those people who remain for health insurance and pensions in future with two separate cards to be stamped, one for pension and one for health insurance, and will not that automatically induce the insured person to remain for pensions only? Suppose they all retain both. We want to know what will happen to those who are voluntary contributors and to persons who are now compulsorily insured whose income exceeds £250 per annum in due course. What will be their option then?
§ Mr. Hudson
The hon. Member might have given me a chance to get on to that, because I am trying to explain a very complicated matter to a large number of hon. Members who are not expert like the hon. Member. He might allow me to go step by step, and I will try to make a complete picture for hon. Members who are not as fully acquainted with the question as the hon. Member. I have described so far what will happen to the 650,000 existing voluntary contributors. One of the possible results of giving people this choice is that a certain number of people will abandon their voluntary contributions for Health Insurance, and that will inevitably affect some of the approved societies. It will affect four very materially. We fully realise the difficulties of these specialist societies that cater for this kind of client. We are studying their position very sympathetically to see what steps can be taken to meet them financially to make their position easier.
485 The hon. Member asked whether a member would have two cards. Anyone who remains under the old scheme will have one card and anyone who comes in under the new scheme will have two cards. Of course in future a man will only have the option of becoming a voluntary contributor under the new conditions. He will still be able to become a voluntary contributor for Health Insurance and pensions, but as far as pensions are concerned only the new provisions of the Bill are applicable and not the old, although should he choose the old he will have to contribute at the rate of 11d. and not at the rate of 1s. 3d.
§ Mr. Hudson
Yes, if he fulfils the other condition, but I cannot conceive of his doing so, because obviously it is far better to continue to be a voluntary contributor at 11d. than to become a new entrant at 1s. 3d. Now we come to the even more complicated question of the excepted occupations and, to make the picture complete, exempted persons. The origin of this class of excepted persons was that in certain industries and employments the terms of the employment were such as to provide benefits roughly equal to and in some cases superior to those provided by the scheme, and it was felt that it would be unfair to make a man contribute twice over. There is the case of excepted persons who, roughly speaking, are members of police forces—and members of fire brigades where they are attached to police forces—who are excepted in respect of health insurance and pensions under the present scheme; they cannot become voluntary contributors under the present scheme and will not be allowed to become voluntary contributors under the new scheme.
There is a second class of excepted persons, broadly speaking the employés of local authorities and members of the Railway Clerks Association and certain other employés of the railways, who are excepted from health insurance and old age pensions but are compulsorily insured for widows' and orphans pensions, because widows' and orphans' pensions are not included in the terms of their employment. When those persons get over £250 a year 486 and so become voluntary contributors they have at present become voluntary contributors both for health insurance and for pensions. In future they will only be required to become voluntary contributors for that portion for which they were compulsorily insured, namely, the widows' and orphans' pensions.
§ Mr. Hudson
Existing voluntary contributors will have three options instead of two. They will be allowed to opt either for the whole of the present scheme or for either health insurance or pensions or they will be allowed to opt only for widows' or orphans' pensions; but in future they will only be allowed to become voluntary contributors in respect of widows' and orphans' pensions, because the new idea is to remove from the people this compulsion which has hitherto existed to become voluntary contributors for both health and pensions.
§ Mr. Hudson
No. Anyone in any excepted employment receiving over 250 a year in future will not be eligible to be a voluntary contributor for health. He is in a particular excepted class; I thought it was under paragraph (b), but I am not quite sure. Then there is a third class. Perhaps it is as well to get all this information into the OFFICIAL REPORT. It is a class of excepted persons who were not originally excepted for health but who, after the 1925 Act, could be excepted for both health and pensions if the employers establish their own schemes. Mainly the employers have been those in statutory undertakings, such as gas. In some cases, although the employers could have applied for exceptions, they paid into the scheme. There are, therefore, now two classes, one of people who are excepted for health and all pensions, and the other of people who were excepted originally for health and are still excepted, and who may be excepted for both health and contributory old age pensions.
The first class under the existing Act cannot become voluntary contributors. Under the new Measure they will also 487 not be able to become voluntary contributors; but the second class could become voluntary contributors; but again, although they were excepted for health, and they had a full health provision, under the existing law they became voluntary contributors for both health and pensions. The existing voluntary contributors have had no option; in future anyone in this class who comes over the £250 limit will become a voluntary contributor only for pensions. Finally, I come to a small class of exempt persons. They were persons who had some income of their own, and, for their own purposes, claimed exemption from health insurance. They can at present become voluntary contributors for both health and pensions, but in future they will be allowed to insure only for the benefit for which they are now compulsorily insured, widows' and orphans' pensions. I apologise to the House for taking up so much time, but I wanted to give hon. Members the complete picture. May I now deal with the vexed question of women?
§ Mr. G. Griffiths
Before the Minister does so, may I ask him a question? A voluntary contributor to-day is paying 1s. 5d. for health and pensions. He has been a voluntary contributor for 21 years. Will he be enabled to get pensions for himself and his wife at 65 if he drops from 1s. 5d. when the Bill becomes law to 11d. per week?
§ Mr. Hudson
I should like to confirm it in Writing to the hon. Gentleman, but I think the answer is "Yes," if he is a voluntary contributor at present—
§ Mr. Hudson
—and he drops his present insurance and only retains his pension insurance. I am assuming that out of the 1s. 5d. pension represents 11d., and that he takes advantage of the Bill and becomes a contributor under the new scheme. He will, of course, get his full pension only if his contributions are at the full rate of 50 a year.
§ Mr. E. J. Williams
Are we to understand that the person who gets £400 a year will be regarded as receiving not a salary but an allowance?
§ Mr. Hudson
That question must be decided between the two hon. Members. Now we come to the question of women.
488 I think I can best start by relieving the apprehensions of the hon. Member for Jarrow (Miss Wilkinson). She said that she wanted every citizen treated as a citizen. I hope she will agree with me before I sit down that in fact the provision we have made in this Bill is based on equal citizenship. I think that perhaps the simplest way will be to give the House a very brief account of how we arrived at the present Bill. Once we had decided to include in a Bill those persons who were at present outside compulsory insurance—and let me remind the House that the Bill was due to the fact that we believed that certain categories of people were not able without State aid to secure for themselves the necessary cover for their old age, which other people who were inside insurance could secure—and we commenced to discuss who were to be included in the new Bill, obviously we were confronted with a ready-made limit of £250, because that was the limit already existing for the compulsory scheme, and it seemed reasonable to take that as a starting point. Clearly, people below £250 could be assumed to require State assistance in order to provide pensions and cover for themselves and their widows.
We started with women, and we examined what was the position of women with incomes of £250. Clearly women below £250 required a State subsidy, and it was therefore decided that women whose incomes were below £250 should be entitled to come into this scheme. The only thing for which a single woman can be insured in practice is for her own old age pension, and that is really the standard. We decided that 6d. was a proper contribution. Then came the question whether we ought to set an income figure higher than £250 for a woman. We looked at it from the point of view of need, and we came to the conclusion, which I hope the House will share, that a woman with an income of over £250 could secure cover for herself at a reasonable price outside. The objections to the scheme which I have seen in the Press, and the objections which have been voiced in some quarters of the House this afternoon, seem to proceed from the assumption that it is either the scheme or nothing, but, of course, that is not the case. It is quite true that the scheme is advantageous, but anyone who does not go into the scheme can still get the cover outside.
489 Hon. Members have suggested, and I see that it is included in the various documents that we have received from certain societies, that a woman receiving between £250 and £400 a year could not save enough for her old age. But the whole system of saving does not consist in putting a few pennies now and again into a child's money-box; there is a widely developed system of insurance, and a single woman aged 25 can purchase an old age pension at the age of 65 for the sum of 1s. 6d. a week with in addition a surrender value. The question arises whether it is too much to expect a woman with an income of over £250 a year to be able to afford 1s. 6d. a week. Can you really suggest, when a woman earning below £250 a year is to pay 26s. a year for pension rights, that there is any hardship involved in a woman who earns £150 a year more having to pay an extra £2 12s. a year for cover in an outside firm? We base this on need. I suggest seriously to the House that it is not a hardship on a single woman to have to pay the small sum of is. 6d. a week to obtain this particular cover. In the extreme case of the older woman under the Government scheme the Government liability represents no less than 94 per cent. of the cost. In the extreme case of the elderly woman coming under the Government scheme 94 per cent. of the cost is to be provided free by the Government. Are you seriously going to suggest that a single woman earning £400 a year has need of a dole of that kind?
§ Mr. Hudson
I am now going on to the question of men. The first thing we thought of was to have the men equal at £250 and we examined it. We admitted that below £250 the man would have to have the advantage of the help of the State. We asked, is it necessary to give the man who is earning more, this help? We were bound to inquire what the man was expected to provide, by way of providing for his wife and children. I am basing this on his need as a citizen. He has to provide, if he can, a pension for himself at 65, a pension for his wife at 65, a pension for his widow if he leaves her a widow, a pension for his children and a pension for his orphans if he and his wife both die. Whereas a woman has only one provision to make 490 for her old age, a man has five provisions which he ought to make. The question arises, Can the man make these provisions? And the answer is not that he has not enough money if he is earning £250, but even if he had the money he cannot because there is no insurance company which would provide the cover, and even if there were the actuarial cost would be between 5s. and 6s. a week. It was clear that the man earning £250 required State help. The question arose, Did the man earning more than require it? In view of what I have just said the answer was that he did if we were going to include the considerable class of black-coated workers we were out to help.
There is no sex discrimination in this at all. On the contrary, if there is discrimination it is against the unfortunate man. I will tell you why. If you will look at the Government Actuary's report you will see the figures quoted. A man is expected to pay 1s. 3d. a week contribution against 6d. by the woman. Of that 1s. 3d. 10d. represents the cover for the widow and orphans, leaving only 5d. for a pension for himself and his wife at 65. You will therefore see that if you allow something less than half of that for the wife, the man is being expected to pay about 1s. a week, not for his benefit, but for benefit which will accrue to his dependants, namely, women and children up to the age of 16. It is impossible, in face of figures like that, to suggest that this scheme discriminates against women and in favour of men.
The hon. Gentleman has not dealt with the point that a woman goes in at the age of 40 or 45. He said that with an income of between £250 and £400, if you had to pay 5s. a week, you could get cover. In the hurried time at our disposal we tried to find out what cover could be obtained from an insurance company for a woman entering insurance at 40 or 45, and we were led to believe that she would have to pay 5s. to get her cover outside the Government scheme.
§ Mr. Hudson
In the first place, it is almost impossible to conceive a woman who has never been at work before suddenly starting off at £400 a year, and, unless you can conceive that, 491 there is no case. In the ordinary case of a woman, she starts off under contract of service at a much smaller salary. She is then an insured person, and, when she rises over £250, she is entitled to become a voluntary contributor, and, instead of paying 6d., she continues at the lower rate of Sid. That is really the answer to the hon. Member for Frome (Mrs. Tate), who said that this would be a further argument for depressing women's wages, and that an employer would say, "We must not raise you above £250 because you will cease to be insured." With regard to the cost of cover in these extreme cases, it would be 3s. 4d. That is about £8 a year. It is very hard indeed to believe that any hardship is being created by compelling a woman earning £400 a year to pay £6 10s. more to get cover outside.
I hope I have succeeded in making the broad outlines of the Bill clear. There has been general agreement on all sides that it meets a want, and I think the figures that my right hon. Friend and I have quoted about actuarial costs show how difficult, if not impossible, it would be for persons in the categories concerned to make adequate provision for their own old age or for their widows or orphans. The scheme is entirely voluntary and it is not meant to help those who are in a position to obtain their own social protection. Although the State grants are generous, especially at the older ages, we have maintained the contributory principle and the scheme seeks to relate benefits to needs and to contributions. Having regard to the size of the State assistance, I say without hesitation that there is no other national insurance scheme that I know of which approaches it, much less surpasses it, in its generosity. I believe that it fulfils the pledges that were made at the last election, and I am perfectly certain that it is worthy to take its proper place in our scheme of national insurance, which, I believe, rightly is at once the admiration and the envy of every other civilised country in the world.