UNEMPLOYMENT INSURANCE ACT, 1935.

HC Deb 03 March 1937 vol 321 cc379-429

3.48 p.m.

The Minister of Labour (Mr. Ernest Brown)

I beg to move: That the draft of the Unemployment Insurance (Additional Days and Waiting Period) Order, 1937, laid before Parliament on the twenty-third day of February in pursuance of the provisions of Sub-section (4) of Section 59 of the Unemployment Insurance Act, 1935, be approved. The House will remember that under the Unemployment Insurance Act, 1934, a Statutory Committee was appointed charged with the performance of statutory duties in connection with the Insurance Fund. One of those duties was to make an annual report upon the financial condition of the Fund. Since that time the House has received four reports from that committee. It would not be in order for me to discuss the details of those reports, except in so far as they have a bearing upon the Order which I now move. The first report was in the nature of a preliminary survey of the problem. In it the committee promised to present an additional report six months afterwards. That report was duly made, and recommended an increase of is a week in children's allowances, raising them from 2s. to 3s. In the following year, last year, the third report was made, and that recommended a reduction in the contributions all round by id., at a cost of £6,500,000 a year. The report on which this Order is based was presented 10 days ago as a result of the committee's survey of the working of the fund during the last calendar year, and it is as a result of their examination of the state of the fund that I move this draft Order to-day.

Let me outline the financial basis of this Order. The fact that we can lay such proposals before the House for its approval is eminently satisfactory. It is not merely an outstanding comment upon the wonderful industrial recovery that has been taking place throughout the country, and that has resulted in increased employment and a decrease of unemployment, but it is proof that the foundations of Part I of the Act of 1935 were well and truly laid. Not merely is there a surplus in the Fund, but the committee are in the position to recommend to the Government and to Parliament an alteration of the conditions respecting unemployment benefit, but not by reduction of contributions or increases of benefit, as has been the case in the two previous reports.

I would point out to the House that the committee reported receipts for 1936 amounting to £65,707,238, that is to say, nearly £i,000,000 more than in the previous year, despite the fact that from 7th July of last year, or for nearly half a year, there has been a reduction of 1d. on the contribution from the employers, the workers and the State. The expenditure totalled £48,000,000, or £6,045,000 less than in 1935, a situation which is due to the increase of employment and the decrease of unemployment. The committee report that the unemployment rate fell from 16.1 per cent. in January, 1936, to 11.9 in August, 1936, whereas the average, instead of being 14.5 for the year as was expected, fell to 13 per cent. The broad result is that the committee were able to report a surplus during 1936 of £17,527,470, so that the cumulative balance at the end of the year was nearly £39,000,000, or £6,700,000 more than the committee had estimated in their previous report.

Those who have studied the report will have noticed that the committee have made three separate analyses of unemployment. They have made an analysis by industries, another by Ministry of Labour divisions—the areas into which the country is divided for the administrative purposes of the Ministry—and a most interesting analysis of unemployment by counties. About that, I would say one thing. The House will have noticed the comment pointing out the unexpected high rate of unemployment and, what is even more important from the point of view of the fund, the unexpectedly high percentage of unemployment ranking for benefit in certain counties, particularly in the Highlands of Scotland and the rural parts of Wales. On this matter there is an interesting passage which I cannot discuss now. I can say only that I have asked the committee to examine the problem further, which they will proceed to do.

My task to-day is easy. I have to recommend to the House to accept the recommendation of the majority of the committee. Two of the members of the committee express a desire for further reductions in contribution or alterations in the manner of dealing with the debt. The Committee recommend two things, a reduction of the waiting period, which now stands at six days, as it has stood for some years, on the one hand, and, on the other hand, an alteration in the number of additional days which may be added to the period for which men who have had good records of employment may draw benefit. That will have a double effect. In the early stages it may prevent men from applying for unemployment assistance, and in the later stages it will keep them on benefit correspondingly longer, according to the number of added days to which their record of employment entitles them.

The financial basis of these recommendations is as follows: As I have already said, the committee realised a surplus of £6,700,000 over their estimate. As a result of their triple analysis of unemployment by industry, by Employment Exchange divisions and by county, they came to the conclusion that they would have a potential disposable surplus during 1937 of £12,275,000. The £6,700,000 of course, is already realised. As the House knows, the committee have examined all these problems with great vision and clearness, under the able chairmanship of Sir William Beveridge, and they came to the conclusion that it would not be prudent to take into account the full £12,270,000. They recommend that we should proceed on the basis of 8o per cent. of that potential surplus. That percentage means £9,820,000. Add to that the £6,700,000 and we get the figure £16,520,000. That sum, together with interest over the period of eight years during which it is to be spent, means a total disposable non-recurrent surplus of £17,250,000.

Hon. Members will recall from our discussion of the previous Order that the preliminary survey of the committee led them to the belief that it would be prudent and wise in all these recommendations to follow an eight-year cycle. They recommend that the sum of £17,250,000, the total disposable surplus, should be disposed over an eight years' cycle at the rate of £2,250,000 per year. Then they proceed to recommend, as I have told the House, that the surplus should be disposed of in those two forms, by taking three days off the waiting period, and providing a certain number of extra additional days at the end of the period of benefit. On the latter point, the committee indicate that it would have been possible to add days of benefit in terms of two weeks additional to the standard period of 26 weeks, but they preferred this way, as being a much more effective and beneficial use of the sum of money. My recommendation, if the House passes, as I have no doubt it will, this Draft Order, is that the shorter waiting period should become effective as from the 25th March.

I do not think I need to labour the point. The committee are quite clear that evidence was laid before them showing a great body of opinion in favour of this reform. More than that; the position with regard to the waiting period is not quite the same as it used to be before the operation of the Unemployment Assistance Board under Part II of the Act of 1934. Previous to that, the argument always was that it was better for a man to have six waiting days at the end of a long period of employment, as the money thus saved could be used for extending the period of benefit. The man now goes straight to the Unemployment Assistance Board when he runs out of benefit, and the argument has not the same force.

Mr. George Griffiths

Will the Easter holiday count as these three waiting days?

Mr. Brown

I will look into that point and let the hon. Member have an answer before the Debate ends. I think that this reform will be universally approved by the House and I shall be indeed disappointed if the right hon. Member for Wakefield (Mr. Greenwood), who I understand is to follow me, does not agree with it heartily—that is the reduction of the waiting period by three days. There is another point on which I desire to say a few words. At the moment when a man has 30 contributions in two years he may draw 26 weeks' benefit, or 156 days' benefit; but if he has good employment over five years he may have three additional days added for every five contributions, less one additional day for every five days' benefit drawn. I think I can make it clear in another way. The right hon. Member for Wakefield knows that my statement is accurate, but the worst of all these things is that they are technical and involve a certain amount of insurance jargon.

Let me give two illustrations of a simple character which will make clear what this reform will do. You alter the ratio of days substracted from one in five to one in eight. That is the simple explanation. I have got out two cases which will show hon. Members precisely how the change will work out. A man with an average of 40 stamps a year, which means 200 stamps in five years, and who has worked zoo weeks, will have drawn an average of II weeks' benefit each year. Of 12 weeks of unemployment, one week will not count because it is a waiting week. He will have drawn 55 weeks' benefit. At present if he has worked 40 weeks for five years, that is 200 weeks, he will be able to draw 54 additional days. Under the alteration, altering the divisor from five to eight, instead of adding 54 additional days you add 79. It really is quite simple. The hon. Member for Hems-worth (Mr. G. Griffiths) now has it quite clear, I think. The effect of this arrangement upon a man who has worked on the average 40 weeks for five years will be that whereas now he gets 54 additional days added to the 26 weeks, he will in future get 79 days added.

But here is an even more striking illustration. If the average were 35 stamps for 35 weeks' work, with i6 weeks of benefit over the past five years, a man can qualify now for nine additional days, but under the new scheme he will qualify for 45 additional days, which means of course that he will have nearly six weeks longer of benefit. If he falls out of work then he will have six weeks longer on the fund than under the present arrangement. I think that on reflection hon. Members will see that that method of adding additional days will be much more effective and beneficial for those who have good records of employment than an all-round distribution would be. The three days off the waiting period will, it is estimated, cost £9,700,000 over the eight years, or £1,225,000 per annum; and the three days added to the additional days, taking a ratio of eight days instead of five, will cost nearly £8,000,000 over the eight years, or about £1,000,000 a year.

Mr. Duncan

Will those additional days be cumulative or must they all be taken in one year? Can they be saved up?

Mr. Brown

They count, of course, against the man's record. So the thing is cumulative in that way. That, I think, is a clear explanation of the proposal and its effects, and I feel sure that it is satisfactory to hon. Members in all parts of the House. A Minister is always glad when standing at this Box to be able to recommend to the House on behalf of the Government of the day the things which, when he sat in Opposition, he used to argue in favour of, and that is my happy lot to-day.

Mr. Roland Robinson

Can the right hon. Gentleman tell the House the number of men who will be affected by the proposals with regard to additional days?

Mr. Brown

I have not got the calculations with me at the moment.

4.7 p.m.

Mr. Arthur Greenwood

I am very glad that the right hon. Gentleman in winding up his speech made a confession, because when this question was previously before the House I reminded him of the time when he stood on this side of the House, on the third bench below the Gangway, as the great champion of the unemployed. We have got rid of that illusion. To-day we find the right hon. Gentleman sitting next to the Minister of Health. To both of the right hon. Gentlemen I have had to reply within the last week, that neither of them understands the formula under which he is working. I will say this for the right hon. Gentleman the Minister of Health: His formula is a statutory one; he is not a rubber stamp. The rubber stamp was put on by this House, and therefore I acquit the right hon. Gentleman. I said what I thought about him last week. The Minister of Labour has asked the House to accept the findings of the Statutory Committee. Is a Statutory Committee to become a dominating factor in this House? The last time it reported the Minister of Labour came to the House very meekly and said, "I, a Minister of the Crown, am the rubber stamp of the Statutory Committee." Now he comes and asks us to accept the findings of the Statutory Committee. I am glad he did it in this case; I am sorry he did it last time.

At the beginning I want to enter my protest against Ministers of the Crown meekly accepting the advice which is given to them. As the right hon. Gentleman has told us, these questions are of ten very technical. It is a common device of Ministers to try to baffle the House by saying, "Well, this is a very difficult question. There is a formula. There is something very complicated. There are very difficult regulations." But this question is not technical. It is dealing with people who are out of work, and it is no use for the right hon. Gentleman to come down to the House and talk about the divisor and subtracting additional days, which to me seems to be confused mathematics. The right hon. Gentleman has not enlightened us on what is the primary problem with which the House is faced. On the last occasion when he came to the House, again putting his rubber stamp on the report of the Statutory Committee, he came with a proposal that there should be a penny reduction in the contribution. That we opposed because, although we thought the rates of contribution are far too high, we said that a penny reduction per week was a penny wasted on the part of every insured person, and that millions of pennies per week kept in the pool and distributed to the unemployed would be something substantial. This time the right hon. Gentleman comes with the report of the Statutory Committee, and they have learned wisdom.

What are our suggestions for the surplus which is accruing going to the unemployed? In the report there is a long discussion because two members of the Statutory Committee disagreed with the majority about using the surplus for the reduction of debt. I remember speaking on a previous occasion and explaining that so far as we are concerned we should never agree to using that surplus for debt reduction, never. I object to the principle whereby the National Debt, all of it accumulated for war purposes, should be placed on the backs of the whole of the people, while a debt accumulated during a period of trade depression should have to be borne only one-third by the State and two-thirds by the people in industry. I am glad to think that the Statutory Committee finally disposed of the idea that any contributions should be used beyond the statutory 5,000,0030 a year, which seems to me to be an outrage—that any funds should be used beyond that for debt reduction.

We do, of course, approve the shortening of the waiting period; there can be no doubt about that. I spoke upon that subject when this matter was last before the House. I am only too sorry that the right hon. Gentleman has not seen fit to apply that to agriculture. I think there has been some misunderstanding about it. I have the correspondence here, and if the Minister would like me to read it I will read it. It will be found in the report that the National Federation of Employers' Associations was asked to give evidence and the Trades Union Congress General Council was asked to give evidence. They gave evidence, and it has been made perfectly clear by the Trades Union Congress and by the organisation representing the agricultural workers that, when the Trades Union Congress said they were in favour of shortening the waiting period, that included agriculture. I think, therefore, that, in view of the type of scheme that we now have for agriculture, something of a gesture to these people might have been made by shortening the waiting period of them also.

While we welcome the shortening of the waiting period—it was a Labour Government that first introduced it and brought the period down to three days—we do not regard that as being too generous a contribution to the solution of the problem of the unemployed, though I agree that there are numbers of people who fall out of work and for whom the immediate urgency of money in the home is a matter of very considerable importance. There is a table in the Report of the Statutory Committee which shows how long unemployed persons have to wait before they can receive benefit. It is true, as they say, that a family may perhaps have secret hoards of wealth on which they can maintain themselves; it is true, as they say, that, if there is nothing of that kind, there is the Poor Law; but at the same time it is equally true that small wage-earners ought, when they fall out of work, to be able to enjoy their benefit without a long delay.

Of course we agree also to any lengthening of the period of payment to people who are out of work. The right hon. Gentleman has explained to us in the most convincing terms—as convincing as those used by the Minister of Health in defining his formula last week—how this is going to work, and I thank the Committee for that. I think it is good that people who have been out of work and enjoy their benefit for 26 weeks should have that period extended. But I am bound to point out that what is being done under these proposals is not to help the people who have been out of work longest, but to do something for the people who have been lucky in the past. It is not for us on this side of the House to look the gift horse in the mouth; we are grateful for the fact that people are going to get more than 26 weeks' benefit; but we are bound to point out also that the people who are getting this extension, hard though their cases may be, are not the people who really ought to be the care of the Minister of Labour and the Statutory Committee.

I want to put some general principles to which we on this side of the House are committed. We opposed the reduction of contributions last time, and we shall continue always to oppose any proposals for the reduction of contributions until the unemployed are dealt with fairly. We would rather that our people paid their penny than that unemployed people should be dealt with in the miserly fashion which appears to be the idea of this Government. We oppose the whole basis of the proposals which are now in operation for making unemployment insurance a business proposition, which it can never be. It does not matter whether it is unemployment insurance, the Unemployment Assistance Board, or the Poor Law; the community somehow has to pay for the unemployed, and nobody will ever find a way of establishing an actuarially sound basis for insurance against unemployment; it cannot be done. We oppose this idea of putting the fund on an actuarial basis by turning people out of it, by shortening the period for which they can get benefit, and by increasing contributions, and we say that, the fund having been established, surpluses, where they accrue, should always go to the advantage of the people who are out of work, and should not be used either for extinguishing debt or for the reduction of contributions. I want the House to understand that, although working people are not well off, they would rather have surpluses used for the advantage of their fellows who are out of work than have them used for microscopic diminutions in the rate of contributions.

Those benefits from the surpluses can be applied in two ways. The first is by an increase of benefits, and, having regard to what is happening to-day, having regard to the ramp which is going on now because of rearmament, having regard to the fact that there is every prospect of a rise in the cost of living, it is important that the Statutory Committee should consider very seriously the utilisation of future surpluses for raising benefits. When this question was last before the House, I gave the House the cost of raising certain benefits. The costs are not extravagant to the fund, but the value to the people who receive the benefits is inestimable.

In the second place, in addition to raising the rates of benefit to a level which will enable the victims of unemployment to live at a reasonable standard of life, we would ask that there should be an extended period of payment. At present it is 26 weeks, and now the right hon. Gentleman, for the very good boy, for the lucky boy, is extending that a little bit. Our desire is that the period of statutory benefit should be extended so as to diminish the chances of unemployed workers having to go to the Unemployment Assistance Board. We should like to see all unemployed workers, or anyhow the maximum number of unemployed workers, getting their payment by right, and not as a result of inquisition; and it is important, therefore, that this limit of 26 weeks per year, which had not been in operation for years until 1931, should be extended. It is all the more important because of the fact that, as hon. Members will see if they look at the report of the Committee and study the returns of unemployment from the various areas, those areas where unemployment has been most prolonged are the poorest. No doubt the right hon. Gentleman will have something to say on a future occasion about the question of distressed areas, and I hope I may have something to say too, so I do not want to venture into that question now; but, if the Government mean to do something about the question of distressed areas, it is all the more important that in these very depressed areas where unemployment has been prolonged, where the agony is hopeless and the suffering is indescribable, we should do what we can to restore the self-respect of the people by lengthening the period for which they can enjoy their statutory right to unemployment benefit without having to go to the Unemployment Assistance Board.

I would ask the right hon. Gentleman to give to me and my friends two pledges. In the first place, although, as I lead the report, the reduction and extinguishment of the debt is a matter for the Board, I am going to ask the right hon. Gentleman to say that, so far as he and the Government are concerned, they are going to give no support on any occasion to any proposal to try to extinguish the debt more rapidly by penalising the people who are out of work. If the surplus is used for debt reduction purposes, obviously it cannot be used for the benefit of the people who are out of work. As the report points out, the only advantage that would come from that would come to people who are not yet in the field of industry; the people who will be penalised to-day will be dead by the time the advantage comes from this reduction of the debt. With regard to the second point, which I think is even more important, I would ask the Minister or the Parliamentary Secretary—I do not want to be too friendly to this Government, but I think it would be good from their point of view to make their position clear—to say that, so far as the Government are concerned, the accruing surplus on the fund shall, as a matter of policy, be used in the interests of the people who are out of work—that is to say, that there shall be no talk in the future of debt redemption and there shall be no talk in the future of reducing contributions, much as we want to see the contributions reduced. We should like an undertaking that, so far as there are surpluses, they will be used for the people who are unemployed.

I am glad to think that speeches made on this side of the House on the last occasion have come true. We pleaded then for a shortening of the waiting period; we pleaded then for a rise in benefits; we pleaded then for a lengthening of the period of statutory benefit; and we were given a penny reduction, for which we offered the Government no thanks. On this occasion we have at least got two minor concessions, or, perhaps I should say, one major concession and one minor concession. We have got a shortening of the waiting period, for which we are all grateful, and we have got, for some people, a lengthening of the period during which they can enjoy benefit. That is an acceptance of the principle that people ought to have unemployment benefit for a longer period than 26 weeks. I do not thank the right hon. Gentleman specially for what he has done for the few persons who will enjoy that concession, but I thank him for the acceptance of the principle that 26 weeks' benefit is not long enough.

In thanking the right hon. Gentleman for this in very moderate and restrained tones—because I am not too generous in my thanks, as he knows—I should like a declaration before we end the Debate on this matter of principle as to whether the surplus on a fund designed primarily in the interests of the unemployed shall in future always be used in the interest of the unemployed and not for ulterior motives, which may please employés and taxpayers, but which are not in the interests of the unemployed workers themselves. No working man or woman who contributes to the unemployment insurance scheme will ever complain when in work as to what the people who are out of work get out of it. They are only concerned for their fellows who are out of work, and for their own future if they should fall out of work. In that sense they are public spirited. In that sense they are generous. I have done my best in such feeble words as I can command to fling back the penny reduction last time in the right hon. Gentleman's teeth. We do not want pence. We want a fair and square deal for the unemployed, and the workers, within their limits, rather than see an injustice to their fellows who are out of work, are prepared to pay for it.

4.32 p.m.

Mr. Graham White

When my right hon. Friend last year commended to the House the recommendations of the Statutory Committee for the third period, we were obliged to oppose them and we urged proposals which are substantially comprised in the recommendations which the committee have now made, and which he in turn recommends to the House to-day. It has been my lot and that of my hon. Friends more often than not to oppose and criticise proposals made by my right hon. Friend since he became Minister of Labour and also by his predecessor. It is, therefore, some small personal satisfaction on this occasion to find that there is something with which I can cordially agree, and I therefore have pleasure in saying so.

The House may congratulate itself on the form in which the report is made. The Minister is free to reject or accept the Committee's recommendations, and the House may or may not agree with him, but it is of very considerable assistance to have the facts placed before us in the concise and clear way in which they are set forth. There is no uncertainty as to the recommendations, neither is there any ambiguity in the statement of the reasons which led the Committee to make those recommendations. Of course, we welcome the proposal to reduce the waiting period and put it back to three days, as proposed in the Act of 1920. The right hon. Gentleman the Member for Wakefield (Mr. Greenwood) referred to the fact that in the Act of 1924 the waiting period was reduced for a time to three days, and I have a small personal interest in that matter. An Amendment moved by my friend Mr. Trevelyan Thomson, whose efforts on behalf of the unemployed will be remembered by all who sat in the House with him, by myself and by the hon. Member for Govan (Mr. Maclean), to reduce the waiting period from six days to three, was accepted by Mr. Tom Shaw, the then Minister of Labour. I regret that the Conservative Government in 1925 or 1926 put the period back to six days. No one who is acquainted with the working of the waiting period can but rejoice to see it cut down to three days. One is familiar with the argument that households are supposed to have sufficient money in hand to carry them over the period of six days, but people are apt to forget that the six days may be as many as 15.

That is a very serious matter and, in my observation, the cases in which help is needed are nearly always urgent cases. They often occur at the week end, and it is difficult, even with the good will of the public assistance people, in fact it is impossible in every case, to get real wants satisfied. I am by no means satisfied that the Minister may not find it expedient in the very near future to do away with it altogether. It is true that those who in future fall out of employ- ment will have the right of going to the Unemployment Assistance Board to ask for any help that may be necessary to tide them over the period, but we have to bear in mind that there will be an entirely new situation after 1st April, when there will be coming on to unemployment assistance a number of individuals, 200,000, or perhaps nearer 300,000, who, without having paid a contribution to the Unemployment Fund in their lives, will be entitled to benefit at any time when they may be out of work without any waiting period at all. The Statutory Insurance Fund will have to face up, for the first time on a large and growing scale, to the competition of the Unemployment Assistance Board in this matter, and it will be very difficult for men coming to the same Employment Exchange to understand why other individuals who, perhaps less fortunate than themselves, or black coated workers and therefore unable to qualify, without having paid a contribution and without a waiting period get benefits equal to theirs, or perhaps even larger. This is a matter to which the Minister will have to give his attention in the very near future. I was glad to hear my right hon. Friend say that he was inviting the Committee to consider further the investigation that they suggested into the stabilisation of unemployment in the most favourable areas at a ratio of from 5 to 7 per cent. That is a figure which, in the present state of industry, we cannot accept. We ought by this time to be endeavouring to extricate ourselves from the fatalism associated with the idea of the trade cycle. I am sure that there is a necessity for an intensive study of that matter.

I should like my right hon. Friend to ask the Committee to pay particular attention to the question of long-term unemployment. There we have one of the gravest things in the unemployment problem to-day. Sir William Beveridge has rendered a public service by drawing attention to the terrible increase that has taken place in the amount of long-term unemployment. In September, 1936, as the Minister reminded us, the percentage of unemployment over the whole country was 11.9 per cent., and in September, 1926, it was 9.8 per cent. There has, therefore, been between those two dates an increase in unemployment of 275,000 persons. The terrible fact about that increase of 275,000 on the live register is that it is less than the addition to the numbers of those who have been unemployed for more than a year in the whole period. That is a terrible figure. It is, therefore, true to say that at present there is much less unemployment of those who have been unemployed for less than six months, but there is no less than six and a half times as much unemployment among those who have been out for 12 months than there was in 1929. In dealing with the live register to-day, the Minister and his advisers should concentrate their attention upon what can be done with the long-term unemployed. Sir William Beveridge goes on to say, in the document from which I am quoting: The perpetual favouring of younger men, merely for their youth, in filling jobs within the competence of older men makes for unemployment. It is an anti-social act and should be recognised as such. That rather suggests the line on which we should attempt to deal with the problem, and I hope the Statutory Committee will, at the instigation of the Minister if necessary, give full consideration to that. I also hope the Minister will consider whether it is not possible to make some special conditions for the employment of older men who have more than 12 months' unemployment in the allocation of work on Government contracts.

I am in substantial agreement with the right hon. Gentleman in his observations with regard to the repayment of the debt I shall continue to oppose any proposals for the reduction of the debt which are not accompanied by some substantial benefit to those at present on the Fund. There never was any justification for fixing that sum of £105,000,000 upon the Fund. We accept very gladly the proposal for the extension of benefits, though it brings into sad relief the lot of those of whom I have been speaking, the longterm unemployed. I hope that next year my right hon. Friend may be able to propose some further amelioration in the lot of the unemployed. I think in any further distribution of surpluses that may accrue it must be concentrated upon the improvement of benefit, and I think dependants' allowances should be the first consideration. We have to bear in mind the very unsatisfactory feature in these scales, both of the Unemployment Assistance Board and statutory benefit, that they do not in fact supply the bare minimum required for help in families of three children and more. That is not a position which can be accepted by any Government which proposes to lead the country in a national campaign of physical fitness. That, I think, should be the foundation stone of any campaign of physical fitness, and if the Government put that to the country they would have overwhelming support for it. The Unemployment Assistance Board, when drawing up their scales, rejected the idea of relating them to the British Medical Association scale of bare necessities or the Ministry of Health scale, or even, I believe, the League of Nations scale, I would appeal to my right hon. Friend, in consultation with the Minister of Health, whom I am glad to see in his place, to take steps to see that there is a scale of minimum needs for health drawn up in which they would have confidence, so that this question of scales on one side or the other may be settled beyond the limits of speculation and conjecture. It is not fair in these days that the matter should be left in that way. It is a lamentable fact that the poorest people in this country to-day, whether they are in work or whether they are out of work, are in the main families who have three children or more and it is one which, I hope, will have some attention directed to it.

The Statutory Committee and also the Unemployment Assistance Board have asked that an inquiry should be undertaken—I do not know whether they are competent to undertake it themselves; I do not know that they are—into the relation between the scales of benefit, the unemployment assistance allowance and the lower wage rates. It is a matter of vital importance that close investigation should take place, and also that it should be related to the establishment of some scale of physical needs. I could do nothing more than indicate them here, but it may very well be that such an inquiry might lead to the conclusion that the only way in which the nation can do its duty to these people, who are the poorest in the land, the families with more than three children, is by some scheme of family allowances. The matter should be probed, and should be settled. The campaign of physical fitness can be little more than a mockery as long as something like 250,000 children are maintained on a scale below the minimum needs of the physical requirements of health.

I am indeed glad that the Statutory Committee rejected the proposal for a further reduction of the contribution for the reason mentioned by my hon. Friend above the Gangway, and also for this additional reason. Unless I am mistaken, an increase in contributions to the Statutory Fund can only be made for the purpose of removing a deficit in that fund, and if further reduction had been made, it would have limited the field of manoeuvre open to Parliament and the Statutory Committee with regard to the increase in the general scale of benefits, which may, indeed, become a matter of urgent and practical importance, if the rise in the cost of living, which is already noticeable, proceeds much further. I hate to appear anywhere, least of all in the House of Commons, as a prophet, but it seems to me that the inevitable consequence of the damping down of civil industry which is taking place in this country to-day, accompanied by an increased distribution of spending power to the communities in the industrial areas, must have the inevitable results of sending up prices in general at a rapid rate, and this matter of the increase of benefits may become an urgent and practical matter before many months are over.

I have expressed the maximum amount of satisfaction that I feel with the proposals which have been laid before the House, and, on behalf of my right hon. and hon. Friends, we accept them, but I hope that the fact that the Minister has been able to make a satisfactory proposal to the House to-day will not cause him to feel that it exonerates him from further efforts. I would say, in particular, that I hope he does not feel that he is absolved from the necessity of carrying out the undertaking with regard to the raising of the age limit for black-coated workers and others. Some of us have been a good deal puzzled to know why we have not been informed of what is to be done in that direction. It may be the wish of the Minister to see the development of Unemployment Assistance Regulations after 1st April, before he decides, but I hope that it will not be long before he tells us what he proposes to do in that direction. My concluding words are that we are looking into a very uncertain future in which we can see little more in the sky than question marks, but I express the hope that in 12 months' time we may not be in a less favourable position than that which we are in this afternoon.

4.51 p.m.

Mr. R. Robinson

It is a striking commentary on the success of the policy of the Government for the reduction of unemployment that for the second year in succession the Unemployment Insurance Statutory Committee, in its report to the House, can tell us that the surplus which last year was £6,500,000 has increased this year to £17,200,000, I feel sure that the Minister, when Members from all sides of the House have spoken, cannot but be impressed with the fact that everyone is satisfied with the way in which the surplus is being disposed of to-day. The right hon. Member for Wakefield (Mr. Greenwood) had to express agreement with what was being done, though he was not, of course, generous in the way that he did it. Indeed he told the House that if possible he did not want to be friendly to the Government, but later he welcomed the proposals that came from the right hon. Member the Minister of Labour. I feel certain that if he had been the Minister and had been able to come to the House and make proposals such as we have heard to-day, the ranks of the party opposite would have cheered themselves hoarse, and we should have been told that Utopia was at last coming into being.

Generally speaking, I feel that the proposal for reducing the waiting time and increasing the additional days will meet with great satisfaction, because it will give help to the unemployed man when he needs it, at the beginning when he is faced with the period of transition and has to turn over his way of living from being supported by a good wage to the much smaller unemployment allowance. It is good to help him at that end because that is the time when his savings, if he has any, are probably exhausted. I invite the Minister to investigate a little further the one question which I asked him as to the number of people who will benefit under this proposal. He told me that the figures were not in his possession. I believe that the figures must be available, because the committee in making its recommendations gave the cost of the recommendations and they must have got that cost from the number of people that they thought would be affected by the scheme. I ask the right hon. Gentleman to try to enlighten the House on that particular point.

I am one of those who for a long time have said that, in order to make the Unemployment Insurance scheme as satisfactory as it can be, it should have the widest possible extension so as to cover if possible the whole of the unemployed. That surely is the ideal at which the Unemployment Insurance Statutory Committee ought to aim. In that connection I am going to press upon the Minister once again the fact that he ought to try and do something to deal with as many as possible of the anomalies in the scheme. Last year I pressed upon him the case of the seasonal worker, and since then nothing has been done in order to mitigate that case. There is there a very real sense of grievance because you have men every year who, in their very short period of work, are paying their contributions to the Unemployment Insurance Fund, and then, when they are thrown out of work, as they must inevitably be at the end of the season, are told that they can draw no benefit which they have paid for because they have not had a sufficient number of weeks in work. I say quite frankly that the assistance that was given in this matter two years ago has been of very real benefit, which perhaps is not generally appreciated all over the country. On the other hand, the effect really has been to make what was a big sore into a small sore, and so long as that sore remains, there is bound to be a great deal of irritation on the part of the people concerned.

I hope that next year, when the Fund will be in an even better position than it is to-day, the committee will consider the position of the seasonal worker and remove that sore altogether. It is a point which has been felt all over the country. Certainly in every seaside and health resort in England there is almost a unanimous opinion that something ought to be done in this matter. Last year I was one of those who disapproved of the recommendations that were made by the committee, and I pointed out to the House that the committee had approached the question of Unemployment Insurance entirely from the wrong angle, and that in their report they had stated that unemployment insurance was a tax on industry and was therefore to them an undesirable form of taxation. I say that it was entirely wrong that they should have preferred the principles of relief to the principles of insurance. So last year, believing that it was undesirable taxation, they took the step of recommending a reduction in the payments. The committee pointed out to the House that the choice between reduction of payments and increased benefits was a major point of social policy for which the responsibility rested on the House of Commons, and in approving the recommendations to-day I feel that the House ought to realise that it is making a major change in its policy with regard to Unemployment Insurance as compared with what was done last year. I agree with that change in policy. I believe that it has been proved that industry can bear the cost of Unemployment Insurance in both good times and in bad, and I hope that we shall continue to use the money for increasing the scope of the scheme, and that we shall have the foundation and the continuance of the finest piece of social legislation the world has known.

4.57 p.m.

Mr. Buchanan

I rise to offer a comment or two on the Motion which is before the House. The present Minister of all the Ministers of Labour seems to have all the breaks with him, and the others have had the breaks the opposite way. While no one can vote against this Motion to-day, there are one or two points of criticism which ought to be stated. I wish to make a point which I have made in previous Debates, and it is one which now is never mentioned, namely, that the unemployed have never had their cuts restored. I am surprised how easy it has been to forget that the unemployed are the only section that have not had their cuts restored. The Minister comes before the House to-day, and, from his point of view, prides himself on the two concessions which he is making in regard to the waiting period and the payment of more standard benefit for certain classes of people.

Let me remind the House that the unemployed were attacked from many angles when the cuts were imposed. Perhaps the greatest cut of all was when the unemployed had their standard bene- fit cut for a period that could extend roughly to a year and four months. A person was entitled to standard benefit if he had 30 stamps in two years, which gave him a balance of a year and four months. That was cut down to 26 weeks as part of the economy cuts which were introduced, and it is the only economy cut which has not been restored. Cabinet Ministers, Members of Parliament, and the ordinary unemployed person with a special record, have all had their cuts restored, but the unemployed person, who is less fortunate, is the only person who has never had the cuts restored. When we are discussing improvements in trade and the marvellous figures of income and expenditure, when this year we can afford hundreds of millions for Defence or arms, we cannot afford to restore to the unemployed the cuts which the so-called crisis of 1931 imposed. Therefore, while we are priding ourselves, let us remember that the unemployed are still far from having their cuts restored. The system of requiring 3o stamps in two year was not merely the act of a Government but the recommendation of the Blanesburgh Commission, which was ultimately put into legislative form, and to-day we still refuse to restore the cut.

The right hon. Member for Wakefield (Mr. Greenwood) said that he wished people would not always accept the recommendations of committees. I, too, wish that they would not do so. When the right hon. Gentleman and his colleagues held office I said that they accepted the recommendations of committees which I thought were indefensibly wrong in regard to the Anomalies Act. Some of the worst features of the Anomalies Act are still there. True, they have been modified, but I could wish that some of those cuts could be reconsidered. I should like, in passing, to protest against the idea that Sir William Beveridge is the one person to make the law of the land. It would appear that his recommendations are in fact the law in many cases. He supplies the law. He recommended the reduction in contributions. The same man whom we are praising to-day recommended the cut in contributions. What he recommended we accepted because of the feeling that when Sir William Beveridge and 'his committee meet in a little room in Whitehall and make recommendations, the House of Commons has to accept them. I do not take the view that Sir William Beveridge is the last word in intelligence, but the idea does seem to be prevalent that he is the one man who can run a Government Commission, for he is appointed chairman of this, that and the other.

May I contrast the position to-day with that of last year? To-day we are reducing the waiting period from six to three days, and making certain minor adjustments of standard benefit, but will hon. Members please note the difference between this year and last year? Last year we had a surplus of between £6,000,000 and £7,000,000. That surplus was used up in the one year. We used it to give back contributions in the one year. This year we have a surplus of £17,000,000, but we are not using that surplus in one year for increases of benefit. The £17,000,000 surplus is to be spread over eight years. We are using only a little over £2,000,000 each year. Will hon. Members note the contrast? When it was a question of returning money to the State and the employers and a small sum to the workers, we used up the surplus in one year, but when it is a question of improving the benefits the surplus has to be spread over eight years.

It seems to me that Sir William Beveridge and his Committee think that this course is inevitable and that we cannot trust to using up the £17,000,000 this year in improving benefit but must spread it over eight years because a cycle seems to be inevitable. Why has that been done? The Minister says, and I expect the Parliamentary Secretary will say the same thing, that the reason is that once we have reduced the waiting period we do not want to have to go back to the six days waiting period, and that this proposal gives a guarantee for the next eight years that the waiting period will remain as proposed. It does give that guarantee, provided that for the eight years trade remains as it is. It gives no further guarantee, and it is possible that at the end of the eight years we may have to alter the waiting period. This year there are claimant demands of the unemployed to be met. The first is the restoration of the cut which has never been made.

Secondly, let hon. Members not forget that when we are talking about what happened in 1924 and to-day the man's benefit in 1924 was 18s. and the woman's benefit 15s. The man's benefit is now only 17s. I can never understand why a woman should be paid 2s. less than a man. We hear very often about our standard of life for men, women and children, but the greatest tragedy is the lot of the single woman living in lodgings. It is a shocking tragedy in our great towns that in these days when we have a surplus of £17,000,000 we should ask the single woman to maintain herself on 15s. a week. It is a shocking disgrace. I think that we ought to have used all the £17,000,000 this year.

We are told that the debt must continue to be paid. The Chancellor of the Exchequer is still exacting his pound of flesh. In addition to demanding the repayment of the debt he is demanding that interest at the rate of 3⅛ per cent. should be paid. If we are to repay that money is there any reason why we should pay interest at that rate? Let hon. Members contrast that treatment with the Government's treatment of the armaments people. The debt of £105,000,000 was accumulated in a few years. If unemployment assistance had been based as it is now, that debt would never have accumulated. On no sense of decency can I see any justification for this sum being repaid. If the fund had not met that £105,000,000 of debt either the local authorities would have had to meet it or the State would have had to meet it. Somebody would have had to meet it, because no one could imagine that the unemployed would have to do without the money.

In 1929 I, with one of the hon. Members for Nottingham, was told that the waiting period could not be reduced because the people had money at the beginning and they did not need it then. Now we are told that it is at the beginning that they need it. They need it at the beginning and the end. Part of this is merely a saving to the national Exchequer. Under the Unemployment Assistance Act a large number of the unemployed had to be paid in the early weeks, particularly men who were working for a small wage with wives and families. I could never understand why there should be a waiting period at all. I think that when a man is unemployed he should be paid benefit, and I trust the time will come when the waiting period will be eliminated entirely.

We cannot divide against this Motion, although we may be critical as to the way the money is being spent. I think we should have used this £17,000,000 to wipe out the waiting period entirely, raise the benefits to single men and women, and also to wipe out the means test for larger numbers of people. As long as the Government propose to build navies and equip armies trade will be good, and the working-class people will benefit, but I fear what is to happen in the future, as does also Sir William Beveridge. I look forward with a good deal of foreboding to the days to come. While we accept this small sum we are not in any way satisfied with it, and trust that the working people of the country will not take it as anything like a satisfactory solution of the present unemployment problem, but will continue to press their legitimate demands for the abolition of the means test and the raising of unemployment benefit to a figure which will represent a much more humane standard than the present.

5.18 p.m.

Mr. Hayday

I want to support some of the criticisms which have been made with respect to these proposals. I feel that it is wrong in principle to place upon the surplus of the contributory Unemployment Fund the onus of having to wipe out the whole of a debt created at a time of national emergency. In 1920 and 1921 the Government of the day had to come to this House on three or four occasions for powers to raise money to meet the calls of those who were on unemployment benefit, and at that time there were thrown on to the Unemployment Fund large bodies not only of workmen but of ex-Service men for whom the State had accepted the responsibility for their weekly benefit. They were thrown on to the Unemployment Insurance Fund, which had a surplus at its disposal. The Government of the day to ease their own responsibilities took the surplus from the Fund and created a very heavy debt, and they are now fastening that debt upon the shoulders of those who have been heavy contributors to the Fund. It will mean a drag being put on any possible surplus accruing when there are bodies of men and women in employment. I fear that as long as the Unemployment Insurance Fund is based on actuarial calculations we shall have these difficulties periodically. I am very much concerned with one or two matters mentioned in the report. I should like the Minister to inform the House whether he has any right to veto or alter any of the recommendations which the Statutory body may make.

Mr. E. Brown

It is the duty of the Minister, if he disagrees with any representations of the Committee, to state his reasons and to lay them before the House. Indeed, on one occasion I disagreed with one of their recommendations, and it was not pursued.

Mr. Hayday

Does that power of disagreement also enable the Minister to question the basis upon which the disposable surplus is arrived at, or must he accept the actuarial figures supplied to him? Is there any ratio definitely set as to how much of the disposable surplus is to go for the benefit of the unemployed and how much is reserved for other purposes, including that of debt?

Mr. Brown

That is a statutory responsibility of the board.

Mr. Hayday

I notice that the accumulated reserve will rise from 21,450,000 to £37,950,000, out of which it is proposed to put £17,000,000 to benefits, leaving still £20,000,00 to be carried forward. That £17,00,000 represents the disposable surplus of two years' working of the fund, and that two years' surplus is to be spread over eight years. It is fair to assume that with the present rate of employment there will accrue certainly a further £9,000,000 a year. That is one reason why we are criticising, I will not say the shortcomings but the restricted scope of the recommendations of the board in suggesting that only three out of the six waiting days should be abolished and that there should be an extension of benefits only to those having a large amount of reserve credit standing to their name. I was one of the representatives from the Trade Unions Council before the board, and we suggested that if the disposable surplus would permit there should be a total abolition of the waiting period. I believe that if the amount of 17,000,000 available for disposal had not been spread over a period of eight years there would be ample surplus to enable the board, if they had felt so in-dined, to abolish the whole of the waiting period.

We were asked what was the order of preference we would propose, and we said, first, the abolition of the waiting period, and, secondly, an increase of benefits. Then we were asked, assuming that there was not sufficient to bring about any general increase in benefits, what would we suggest to enable benefits to be increased, and we said then, as I say now, that there should at least be an increase in the benefits for dependent children. Then other questions were put to us as to whether we really thought benefits should be increased to such an extent that the margin between the week's wage of a man at work and the benefit would be so small that there would be less incentive on the part of an unemployed person to secure work. Our answer to that, and our answer to the Minister to-day, is that if you withhold an increase of benefit for fear that it will clash with wages paid by employers who are sweating the workers you will be lending yourselves to a still further lowering of the standards of living.

We decline to accept that as a reasonable argument. Had the disposable surplus been restricted to a shorter period, it would certainly have made possible an increase in benefits, if not in general, at least to the dependants of unemployed persons. The argument was put forward that, if one takes the case of a man having a wife and five or six children and if one bears in mind that there are still some employed people who receive only 32s. or 33s. a week, such an unemployed man would be placed in a privileged position. That is an argument which I do not think any sane person will accept, for there is no logic about it. I wish to impress upon the Minister that in future, if there are disposable surpluses available, we shall ask that they shall not be spread over so long a period, but that they shall be made available for the immediate alleviation of distress among the families of the unemployed. As one hon. Member has already said, it is more a problem of the middle-aged than it is of the younger men. The prospects of an unemployed man who is over 40 years of age ever again securing employment are very remote. Employers are quite frank on this, and ask why they should take on men who are past 4o years of age when they can get men of 25 and 3o years of age who have all the virility of young manhood. The middle-aged man is in the main the family man, and consequently pressure is hardest on the homes of those men who have only remote chances of being able to get employment.

My right hon. Friend the Member for Wakefield (Mr. Greenwood) called attention to the fact that, in the agricultural section of the report, there is no provision for a reduction of the waiting period. It is stated that no representation was made on that matter. I must inform the Minister, as I believe he has been informed already, that when we appeared before the Statutory Committee, we made a general request for the abolition of the waiting period. It is true that as long as there are separate schemes within the Act, there are bound to be anomalies, and it may be true to say that no one section was specially mentioned in connection with the waiting period, but the request was made applicable to all who come within the unemployment insurance scheme. On the question of extending the period, we submitted evidence and were questioned as to whether, as suggested in the report, it would be better to give an extended period to those with good records, or whether we would prefer a general extension of the period. We felt that a general extension would be right. The adoption of the first-mentioned method would mean that the men who had been at work longest would be those who would secure the longest period of benefit, whereas the unfortunate intermittent worker, having short periods of employment and long periods of unemployment, would be the man who would be unable to satisfy the extra qualification.

We are told—and I suppose we must accept it on the basis of these calculations—that there is only a certain amount of money available for disposal in these directions. If my memory serves me rightly, we were informed that it would be possible to extend the benefit only by one or, at the very outside, two weeks. Although that would have been acceptable, we realised the smallness of the extension; but I suggest that at some time or another the House must lay down a policy as to the ratio of allocations of disposable surpluses. It was not right that the amount of £105,000,000 should have been added. I agree with the hon. Member for Gorbals (Mr. Buchanan) that there has been no restoration of rights as regards the restricted periods of benefit. In dealing with the unemployment problem, we now seem to be tied for ever to these statistical schemes. Not only have these schemes to be actuarially able to meet current responsibilities, but they must be so restricted as to provide for a measure of debt redemption for which the Fund was never responsible. These actuarial commitments do not belong to the Fund. I would ask the Minister what is the meaning of paragraph 29, which ends with the statement: Keeping our original estimates of unemployment in 1936–43 as ground-plan, it is as if we had started with an accumulated reserve, not of £21,450,000, but of £37, 950,000. That is the effect of the lower unemployment experienced in 1936 and in prospect for 1937. Assuming that £17,000,000 is a two years' disposable surplus, what about the other £20,000,000? Is that a carry-forward surplus for emergencies? If that be so, seeing that we are told in the report that any such contingency is not likely to arise at least over a period of eight years and that debt redemption payments are being made, why could not part of that £20,000,000, which is at present included in the £37,000,000, be called a disposable surplus, and thus enable the Minister to abolish the waiting period, to give an extension of benefit and possibly some extension of the period? Apart from those considerations, I can quite conceive the Minister saying that the best possible use has been made of the restricted amount, but our complaint is that the amount has been restricted too much and that there has not been a full utilisation of the available surpluses which have accumulated to the credit of the Fund and which ought to be used at this stage to ease to some extent the position of those drawing unemployment benefit.

5.39 p.m.

Mr. Duncan

On more than one occasion this afternoon the Minister of Labour has been called a rubber stamp. I would like to point out to the House what is the exact position with regard to the recommendations of the Statutory Committee in order to show that neither my right hon. Friend nor this House is a rubber stamp. I will quote from the 1934 Act, since that Act was passed through this House and the 1935 Act was merely a consolidating Act. Section 17 of the 1934 Act says that if the committee at any time report that the Unemploy- ment Fund is, or is likely to become insufficient to discharge its liabilities, and is likely to continue to be more than reasonably sufficient to discharge its liabilities, it shall make recommendations for amendment, and shall also make an estimate of the effect which the Amendment recommended will have. Within the period of two months of the committee having made its recommendation. the Minister, at the expiration of that period, shall lay the report before Parliament and shall lay the draft of an Order making such amendments as are duly recommended by the report, or, if and so far as any amendment so recommended is not adopted by the Minister, shall make such amendments as will in his opinion have substantially the same effect on the financial condition of the Fund. If and in so far as the amendments proposed by the Draft Order differ from the amendments recommended by the report, he shall make a statement of the reasons for the difference, and then if the House resolves that the draft of the Order laid be approved, the order shall be issued.

That means that the Minister has complete power to disagree with the recommendations of the Statutory Committee and to state his reasons in a Paper laid before the House, and that the House has the right to reject the recommendations, as indeed hon. Members opposite did refuse to accept recommendations last year. Consequently, the idea that my right hon. Friend is a rubber stamp is quite unfounded.

Mr. G. Griffiths

He is this year.

Mr. Duncan

A great deal has been said about the debt. I am not going to insure against the future, as hon. Members opposite have tried to do, but I will simply say that this debt was caused at the time hon. Members opposite were in office—[HON. MEMBERS "No !"] Most of it was, and it mounted up day by day until it reached £110,000,000. I would like to make the conjecture that if hon. Members opposite ever came into office again, they would be very happy to have this Fund solvent, because of the effects of their policy on the country. I rise chiefly, however, to support the recommendation which has been laid before the House by my right hon. Friend. I consider that the reduction of the waiting period is a very good thing and will be of great benefit to many of the unemployed; but I would like particularly to emphasise the second recommendation as to the additional days' benefit for men having good employment records. I have come across many cases in my own constituency of older men with good employment records when they were young —lorry drivers and such people—who, after 30 years or 40 years with good employment records, have tended to drop out of employment because employers will not take on older men.

My right hon. Friend has given us one or two illustrations this afternoon, and I would like to ask him what effect this second recommendation would have in the case of a man with, say, a 30-years' good employment record. I think my right hon. Friend said that the maximum which could be given at present was two years less two days. This change should make a difference to some of the men with good employment records who are growing old. It should enable them either to continue in benefit or give them time enough to find another job so that they need not come under unemployment assistance at all. I hope that the Parliamentary Secretary will give us some more information as to the effect of the second recommendation upon cases of this type.

5.46 p.m.

Miss Rathbone

I wish to register my disappointment with these recommendations. None of us will grudge the small concessions which are being made to the unemployed, but I suggest that there was an even stronger claim in morality and justice upon this Fund. I think it was the hon. Member for Gorbals (Mr. Buchanan) who pointed out that women get 2S. less than men under the insurance scheme, and receive an amount which is inadequate for their sustenance. As he pointed out, it is a mistake to suppose that the needs of the unemployed woman, and especially of the unemployed woman who has to live alone, are less than those of the unemployed man. Often her need is as great as that of the man because if she eats rather less, her clothes cost rather more, and she finds it more difficult and more expensive to obtain respectable lodgings.

That, however, is not my real point. The scheme of unemployment insurance rests upon actuarial considerations, and benefits should be based on the just claims of the contributors to a fair return for their contributions rather than on any kind of humanitarian appeal. I do not think the Minister can deny that in the unemployment insurance scheme the women contributors are not getting a fair deal. They are paying out of all proportion to the value of the benefits which they receive, and I challenge the Minister to deny that if the women's contributions were pooled separately and if they were given benefits based solely on the value of those contributions, the amount which they would receive would not only equal the corresponding amount in the case of men but would be considerably higher, because they have a smaller amount of unemployment. I think, however, women would not greatly object to receiving less than they are entitled to, if the Government would only consent to act upon one consistent principle in the matter. Let the Government either treat women as part of the general body of unemployed or treat them separately.

There is a case to be made out for pooling contributions and benefits and letting men and women share and share alike, but, if so, what is the necessity for the inequality between the rates of pay and rates of benefit of men and women respectively? What is the necessity for singling out one class of contributors which does make a heavy claim on the Fund, namely, the married women, and subjecting them to totally different regulations from those which apply to other contributors? The regulations under the Anomalies Act have the effect of ruling out a large number of women who have been paying regularly to the Fund without any chance of getting anything out of it. Wherever the Government can make a profit, either for the State, or for the employers, or for the men workers, by treating women as a separate class they do so, but wherever it pays to treat them as part of one community they are treated accordingly. The result of the present system is that women, regarded as a separate class of contributors, pay enormously more than the benefits which they receive are worth, but they are told that it would be a great shock to public opinion if men and women were charged the same rates of contribution and received the same rates of benefit.

I submit that the first claim upon this surplus ought to have been that of doing justice to the women contributors, either by equalising the rates of contribution and benefit or, as could have been done at relatively small cost, by leaving the women's contributions where they are and raising their benefits to the same scale as the men's benefits. The Minority Report of the Statutory Committee recommended that the scales of benefit and scales of contribution should be alike for men and women. That would have cost a very small sum, and the reasons given against it were to my mind inadequate. They amounted, as I have said, to the plea that it would be a shock to public opinion if men and women were put on the same level in this respect. Women are less organised than men, and less articulate. [HON. MEMBERS: "Oh."] Yes, the women workers are less articulate than the men workers, and everybody knows it. The woman worker is unselfish and patient, and if she stood up for her rights as effectively as some of the clients of the hon. Members above the Gangway, the organised male trade unionists, stand up for theirs, very different treatment would be meted out to her. As it is, advantage is being taken of her ignorance and her loyalty to the men workers.

Women continue to be charged these rates, which are out of all proportion to anything they get; they are still made the victims of the old game of "heads I win, tails you lose." I am very disappointed that with this large surplus at its disposal, the Statutory Committee should have contented itself with these recommendations. As I say, I do not grudge the concessions which have been made to the men, but justice ought to come before generosity, and the first claim upon this surplus was that of making restitution for what has almost been stolen from the women.

5.53 p.m.

Mr. G. Griffiths

I have never seen the Minister of Labour in a more happy frame of mind since I came to this House than he was in this afternoon. I have seen the right hon. Gentleman in some stormy scenes, but to-day he stood at that Box with the sunshine beaming upon him. But he was wrong when he made the statement that everybody in the House would agree with him upon this matter. The hon. Member for Blackpool (Mr. R. Robinson) who, having said his little recitation, has gone from the House, also claimed that everybody was satisfied with the disposal of the surplus, but I think the speech of the hon. Lady the Member for the English Universities (Miss Rathbone) showed that everybody is not satisfied. I notice that the Minister having said that everybody was satisfied immediately started a "grouse" himself about his own people, and said that seasonal workers ought to have more consideration, and that something ought to be done about it.

The hon. Member for North Kensington (Mr. Duncan) spoke about the debt. As Mr. Speaker has said, it is desirable that we should have in this House the "cut and thrust" of debate, and the hon. Member for North Kensington having given the cut, I propose to reply with the thrust. He talks about the debt which the workers owe and which was borrowed from somewhere by successive Governments from 1921 onwards. It is true that the bulk of it was borrowed at the time when we had that great economic blizzard to which the right hon. Gentleman the Member for Epping (Mr. Churchill) referred. The right hon. Gentleman said that the situation which arose at that time was the result of the blizzard and not the fault of the Labour party, and he made that statement about ten minutes after we had gone out of office, and hon. Members opposite had got into it. The highest amount of debt accumulated under this head was £115,000,000. And remember that it was the debt of the men who had worked and fought during the War, and who had responded to the call to save their country. They came home and there was no work for them, and so they were put on unemployment payment and the debt accumulated until it reached the figure I have mentioned.

I was in the House when the Chancellor of the Exchequer was asked by the right hon. Gentleman the Member for Hillhead (Sir R. Horne) to reduce the interest on this debt which then stood at 4 per cent. They brought it down to 3⅔ per cent., at which it stands to-day. That is interest on the debt which the unemployed owe. We have paid in interest this year £4,230,646 while the capital repayment was £769,000. We are paying interest to an amount which is about four times as much as the capital repayment, and it will take us until 1973, or 37 years from the time when we started, to pay off the debt. I expect that I shall be dead by then, but children yet unborn will have to pay that debt. I suppose hon. Members opposite would say that it was a case of the sins of the fathers having to be visited on the children to the third and fourth generations. But that is not the case when foreigners borrow money from us. Italy owed us £608,000,000. A few years ago this country wiped off £528,000,000 of that and she still owes £80,000,000. We did not say to Italy, "You must pay 3⅓ per cent. interest on that debt." France owed us £600,000,000 and the present Secretary of State for Scotland came to that Table and announced a scheme by which it was funded somehow, so that £400,000,000 of it was wiped out altogether. If we can forgive the debts of these people who borrowed money from us during the War, why can we not wipe off this debt?

I come now to a question which has not yet been raised in this Debate. I refer to the case of 1.he boy who starts work at 14, who pays his contribution of 2d. per week while the employer pays 2d. and the State pays 2d., and who has to pay 104 contributions before he is entitled to any benefit in his own right. A person over 16 years who goes into an occupation is entitled to benefit when he has paid for 30 stamps. Suppose a lad pays in 30 stamps from 14 years of age to 14 years and seven months, and he is out of work from then until he is 16 years of age, unless his father is out of work as well as he, he cannot draw benefit. Take the mining industry. I know some fathers and some sons, the latter between the ages of 14 and 16, who are not working on the same shifts. The father works days and the lad works afternoons. I say that unless a lad and his father are playing at the same time, and the father claims unemployment benefit, he cannot get it for his son because fie lad is working. If the lad is playing and the father working, the lad cannot get anything because his father is working; and when they are on opposite shifts, and the boy is working on the day shift and the father playing on the afternoon shift, the father draws part-time unemployment benefit, but when he goes to draw that part-time benefit, he cannot draw for his lad, because that lad has had three days wages. I ask the Minister to remedy that flaw, so that when the father is playing and the lad has put on 30 stamps, the latter shall go on his own account and not depend upon his father. At present you are victimising a lad like that. He has to pay 104 stamps before he can draw on his own account, whereas a male over 16 can draw when he has got 30 stamps on.

Another point that I would like to raise was referred to by the hon. Member for North Kensington when he spoke about the accumulated fund beside the debt. Anybody can make an accumulated fund if he puts sufficient on the shoulders of the people in the fund to make the accumulation, but the hon. Member did not mention that. The worker was paying 7d., and then the Government said he must pay 10d. He paid 3d. per week more, or over 42 per cent. higher, and that is where you got your accumulation, or a certain amount of it. He is now paying 9d., which is 28.5 per cent. higher than before. "Ah," says somebody, "but he is getting some benefit." Yes, he is. He gets 1s. addition if it is a case of a man, a wife, and one child. Instead of getting 28s., he gets 29s., and the percentage of the 1s. to the 28s. 1s 4 per cent. He gets 4 per cent. increase in his benefit, and he pays 28.5 per cent. increase in his contribution, and that is where the accumulation on the Fund arises. If he was not paying this 2d. addition, then the Fund would be less by something like £5,000,000 a year at the present time, and I ask that the increase of benefit should come where the increase of contributions has been paid.

The hon. Member for the Combined Universities was talking practical common sense. What is 28s. a week for a man with a wife and one child, when he has to pay 12s. 6d. a week rent out of it? There is no man in this House who would like to live on that, and I am glad that I have not to do so. When you face up to facts, 12s. 6d. for rent leaves about 17s. 6d. for three of them to live on—food, clothes, and everything else. Then you say, "We will have physical jerks; we want an Ai nation." You cannot get an A1 nation on starvation like this. Why do they not recommend that it should be increased above 26s.? I know. If the statutory benefit were increased above 26s. and the children's benefit above 3s., the Unemployment Assistance Board could not very well keep down the unemployment assistance scales, and they would have to be lifted up. Hon. Members opposite say that if you lift up the scales of unemployment benefit very near to the level of wages, nobody will work. Do not take those hon. Members for your looking glass, because I have never met a man yet—and I have had thousands in front of me—who would not work if he had a chance of a job. In the districts where unemployment is so prevalent, if they hear talk of one job, they run for it as hard as they can, and it is a libel on these people to say that, because the unemployment benefit is very near the wage level, they will not work. You are doing well by your British working man when you begin to say that sort of stuff. I say that they will work, that what they want is a chance to work, and I ask the Minister to state why he did not ask the Statutory Committee to raise the amount from 26s. to 28s. or 30s. so that the people would be able to be fit for physical training when called upon.

6.8 p.m.

Mr. R. Acland

I hope I may be allowed to ask one short question arising out of the smaller report which accompanies the main report of the Unemployment Insurance Statutory Committee. The Minister will have noticed with satisfaction that for the two months for which we have figures, the rate of agricultural unemployment has been very substantially less than the anticipated rate on which the finances of the agricultural scheme were based. The figures, as he knows, were 3 per cent. in November and 4.4 per cent. in December, as against an estimated rate of 7.5 per cent. I appreciate very fully the following sentence in the report, that no very definite conclusions can be drawn from these two months' experience, but if the rate continues to be round about 4.4 per cent.—and, after all, December is likely to be one of the worst months—it is clear that we shall be able to keep the scheme solvent with a very much reduced rate of contribution as compared with that which we provided for last year.

The question that I want to ask is, whether the agricultural industry will have to wait until this time next year before a reduction is made in the rate of contribution? Would it be possible, would it be too much, to ask the Statutory Committee to give us an interim report by July? By then all the worst months of the agricultural year will be over, and if they based their figures on their experi- ence from November to April, they would not be likely to err on the side of optimism. I do not suggest that as early as July it would be possible forthwith to adopt a rate of contribution which could be looked upon as permanent, but it seems to me to be possible that even as soon as July the Statutory Committee might feel that they had had enough experience of the working of the Act to justify them in making some recommendation for a reduction in the contribution from agricultural workers and their employers. If that could be done, I am sure that it would be welcomed by all in the industry, because they are paying a substantial sum out of the rather low remuneration which they receive.

6.12 p.m.

Mr. Rowlands

Hon. Members opposite have commented upon the fact that the Statutory Committee has been called upon to report on the financial position of the Unemployment Insurance Fund. Personally, I think it is a very good thing, because, in the first place, it has enabled the Minister to have a recommendation from people free from the influence of party politics, and inasmuch as he made it clear that the Minister is not bound by the recommendations of the Statutory Committee, but can, if he likes, make recommendations of his own, if he differs from the Committee, I think the situation is very satisfactory. A great deal has been made of the fact that certain benefits were higher some time ago than they are to-day, and it has been stated that the unemployment insurance cuts have not been restored. The House will recollect that the hon. Member for Gorbals (Mr. Buchanan) pointed out that the amount of benefit for men in 1924 was 18s. and that at present it is 17s., but he did not tell the whole story. He forgot to tell the House that a husband and wife's benefit in 1924 was 24s., whereas at the present time it is 26s., and he also forgot to tell the House that In 1924 the child's benefit was 2s. and that it is now 3s. Another fact that he forgot to tell the House was that at that time there was an Amendment moved to the 1924 Insurance Act, which was brought forward by the Labour party, and that when the Amendment was moved that the 2S. should be made 3s., it was strenuously opposed by hon. Members opposite.

Mr. Buchanan

I opposed them on that question, and everybody knows that I did.

Mr. Rowlands

I was going on to say that, although the Government of the day, which was a Labour Government, opposed that increase, the party to which the hon. Member for Gorbals belongs voted unanimously for the increase. But hon. Members who to-day are complaining that benefits ought to be a great deal higher are the very people who lamentably failed when they had the opportunity to improve them.

Mr. Batey

The hon. Member should tell the whole story.

Mr. Rowlands

If I am asked to tell the whole story, the whole story is this: Unfortunately, from 1921 onwards the Unemployment Insurance Fund has been in a deplorable state from an actuarial standpoint, and my sympathy has been with every Government in office which has wanted to pay the benefits which they thought the people ought to have. The position to-day is that, having placed the Fund on a sound financial basis, we are in the happy position of having £17,000,000 at our disposal. The hon. Member for Gorbals has criticised, as he is entitled to do—and there is a great deal of force in his argument—that a greater amount of the surplus was not being spent. I prefer the more conservative method of looking to the future rather than embarking on a policy which we might regret at a very near date, and which would make the position of the worker a great deal more difficult.

The hon. Member for the English Universities (Miss Rathbone) referred to the unfair treatment of women, and said that women, according to their contributions, did not receive anything like the proportion that men were receiving. The single man has had to contribute towards the women from 1921. He has paid the same contributions as the married man, but he receives a paltry 17s., while the married man receives 26s., and, if he has one child, 29s.; two children, 32S.; and three children, 35s. There is a principle underlying this practice. All insurance societies are based upon the strong helping the weak. A man who has been in employment pays a lot more than he will ever get out, and he should consider himself lucky that he has been in employment and is able to help his more unfortunate brother who has been unemployed for a large number of years.

I welcome the recommendation for reducing the waiting period. I am glad to find that the Minister has the right to alter the recommendations of the Statutory Committee. That being so, I should like to suggest that instead of the waiting period being three days in six, any three days within a given period should qualify for benefit. The three days' waiting period in six has hit people in the mining industry very hard. It has been possible to lose two days a week for months and yet men have been unable to qualify for unemployment benefit. I hope that the Minister will alter the Regulations so that any three days over a period of three weeks will qualify as the waiting period. The longer period of benefit will be a very good thing. It has been criticised on the ground that those people who have been longer in employment will get a longer period of benefit, but you could not lay it down that a man who has been working for six months should have a longer period of benefit than the man who has been working six years. I am glad that the new Regulations will make it possible for the man who has been in regular employment for a large number of years to draw unemployment benefit almost up to a maximum of two years. This will have an important effect upon the Unemployment Assistance Board. It will take a large number of men off the means test, because it will keep them longer without having any need to be submitted to a means test.

6.21 p.m.

Mr. Ellis Smith

Many of us spoke upon the report when it was presented 12 months ago, and the speeches that were made on that occasion would bear repeating on this report. I am more than ever convinced that the organisation that counts with the Government more than any other is the National Confederation. It is obvious that the National Confederation determines the policy which this Government should pursue generally, and particularly in regard to unemploy- ment insurance. It is well known and generally accepted among business people that it is impossible to put unemployment insurance on an actuarial basis. Some of the biggest insurance companies in America have recently had expert actuaries on this question, and they have come to the conclusion unanimously that it is impossible to put unemployment insurance on an actuarial basis. If anyone on the Government side doubts that, I would point out that the Refuge, the Prudential and other insurance companies would have gone in for this form of insurance long before now had it been a business proposition.

I want to raise a question of administration. I was present last Saturday at a conference where there were a large number of representatives of people who will be affected by these changes. They welcomed them, but they are concerned about the administration. I understand that for purposes of continuity it will still be necessary for the three waiting days to be put in within a limit of 10 weeks. How will this affect us at holiday periods? We find that more and more employers are extending their holidays to enable them to get over internal difficulties, to make great changes inside their factories, and to carry out maintenance work. For these purposes holidays are being more and more extended. There is, in addition, the question of short time. The position has greatly improved in certain industries, and in the mining industry in certain districts and some parts of the cotton and pottery industries, a small amount of short time is worked. I understand that the divisional officers have come to arrangements with representatives of large factories and of industrial organisations which enable the work-people during these extended holiday periods or during short time to be excused from taking out their unemployment insurance cards.

If that arrangement can be arrived at between divisional officers and big factories, I want to ask, now that the waiting period is being reduced, whether the. Minister will consider allowing it to be made throughout the country instead of in only certain areas. These arrangements have been made for a long period where it suited the Employment Exchange or the divisional officer. For example, suppose a firm has been employing over 5,000 people. The firm with which I am familiar has been employing considerably over 10,000 people. In those cases it has been easy for arrangements to be made with the divisional officer which enabled the workpeople not to take out their insurance cards, with the result that they have got the waiting period in automatically. Now that the waiting period has been reduced, it will mean long queues at the Employment Exchanges unless this arrangement can be carried out throughout the country.

6.26 p.m.

Mr. Woods

I have been impressed with the lack of real optimism in dealing with this matter. The very fact that the surplus is to be distributed over a period of eight years indicates a lack of faith in the future. Small as the concession is, I think that Members on both sides and people throughout the country will be glad of it, no matter how small the alleviation it may mean in the lot of those whose fate it is to be unemployed. It has been complained that those who are hit hardest by unemployment will benefit least under this scheme. We should be happier if there had been some arrangement whereby those who had suffered longest the hardship of unemployment would have a greater degree of relief. There is one group whom I have in mind, and I shall be glad to know whether the Minister can hold out any hope of anything being done for it. It is that small group of people who are past 65 years of age, whose only benefit from the State is the 10s. old age pension. Instead of going on to public assistance in order to augment the pension, they still have sufficient sturdy independence to do one or two days work a week. In my constituency there is a considerable percentage of such old people, and, being near the city, they are able to get a day or two's work in connection with such an industry as the Sunday newspaper. They work from 12 to 15 hours at the week-end, and their average pay is about 6d. an hour. The Act provides that employers in such cases shall pay the whole of the premium, but, while that may be true, everybody must concede that the actual wealth produced is some sort of indirect payment by the individual concerned. These men, however, get absolutely no benefit under the scheme. If they fall ill they are entitled to medical service, but if they fall out of work they have no claim on the Unemployment Fund. Such minorities, who are making their contribution and getting absolutely no benefit, are in a far worse position even than the women referred to by the hon. Lady representing the English Universities (Miss Rathbone). I think that with a surplus in the Fund this small group of those who have served faithfully in industry, and are now trying to maintain a sturdy independence by doing what further service they can, working usually at hours which are inconvenient to other workers, should receive some recognition. Although it would be a small thing for the Fund to make some allowance to them when they fall out of work, it would mean a tremendous boon to them. I hope the Minister will consider the position of this group, to see whether something cannot be done for them.

6.31 p.m.

Mr. Lawson

I think the hon. Member for Gorbals (Mr. Buchanan) disturbed the Minister when he pointed out that there must be some special virtue in him which had put him in the position of being able to make such a favourable showing to the House. To those of us who have for some years watched the Ministry of Labour—and had some experience there —and seen the constant procession of those who went there as strong and virtuous Ministers to begin with, but ended by not feeling quite so strong or so virtuous, who went into the Department with pride and came out with pleasure, the Minister this afternoon has presented a rather unusual sight. The other day one of my hon. Friends did what I have been trying to do for some time—actually made the Minister blush. He told him that he was one of the ablest Ministers and that he expected much from him, and that made him blush more than any of the hard things I have said to him.

My right hon. Friend the Member for Wakefield (Mr. Greenwood) raised a number of points, and one to which I should like to have an answer dealt with the future repayment of the debt. The fact that we are discussing a special surplus is a very significant one, and worthy of the close attention of all who have some interest in the future of employment conditions in this country. The Statutory Committee itself is surprised that there is such a surplus. It took the advice of the Committee of Economic Information, I think they call it—the Cabinet's advisers—and that committee gave such advice about the years to come as led the Statutory Committee to believe that the mean unemployment over the year would be 14.5 per cent.—the real mean of unemployment is 13 per cent. The significant thing about the reduction in unemployment is the insistence of the advisers on this occasion—it is the underlying theme all through the report—that this prosperity is in the main due to rearmament. I do not know whether the Parliamentary Secretary questions that or not, but I think there is real ground for that assertion. In page 6 of the report the Statutory Committee point out that 21 industries in which there is a reduction of unemployment are mainly, though not wholly, such as would be stimulated directly by the Defence programme.

In various parts of the report there is insistence on that point, and I am pleased that it is emphasised, because there is a tendency to believe—I can only hope that it will be true—that the improved conditions are due to normal trade prosperity. Even some of the economists say that apart from the Defence programme there is an improvement in normal industry. But it is very important that that point should be remembered, and while we cannot deal with it to any extent now it must be underlined for future reference when we come to discuss the Government's policy in respect to the long-term unemployed, who are concerned in this matter and who were mentioned particularly by the hon. Member for East Birkenhead (Mr. White). One thing which has been remarkable in the past year or two is that, while there has been a reduction in unemployment the proportion of those wholly unemployed has increased by leaps and bounds in reference to the numbers unemployed. Out of 1,600,000 unemployed there are no fewer than 1,434,000 who are wholly unemployed—out of a job. I think the right hon. Gentleman and others who have come into contact with the figures will agree that that proportion is becoming alarming. As the hon. Member for East Birkenhead pointed out, there are more than 300,000 persons who have been unemployed for 12 months, and they form almost one-fifth of those wholly unemployed.

The significant fact to be noted is that at a time of prosperity, when there is a great boom in the South and in the Midlands, and here and there in patches throughout the country, there are good, strong, able, industrious men who cannot get work and do not appear to be likely to get work. They, unfortunately, will not be aided by the proposals in this Order. My right hon. Friend the Member for Wakefield rightly pointed out that while the reduction of the waiting period from six days to three will help quite a large number of the unemployed, and while the substitution of the eight days for the five will reach some, the change will not reach those who are most in need of consideration, and will not reach the worst-hit areas, either. The Statutory Committee comment in their report on the reduction of unemployment in certain areas like the mining areas, but they also point out that three-quarters of the wholly unemployed in Wales are, I think, in Glamorgan and Monmouthshire. In other counties which, taken as a whole, show apparent reductions in unemployment, there is still great unemployment concentrated in the heavy industry areas, and, what is worse, the people there have been unemployed for years, many of them for two, three, four or five years. Those are just the areas where the operation of the means test is felt most, and, personally, I would rather see the whole of the money go towards such an extension of the period as would bring the largest number of persons within the ambit of unemployment insurance in preference to leaving them to Public Assistance, so keeping them out of the range of the means test. Those are the people who have had the longest stretch of unemployment, whole areas have been devastated, and they need most consideration.

I hope the Minister will not give any credence to the suggestion in the Minority Report that there should be a reduction of contributions, or—I believe the view is held among some members of the Statutory Committee—that the debt should be reduced; in fact, the Minority Report says that it ought to be reduced at a more rapid rate. I do not know why there should be this continual insistence on the reduction of that debt. Although we talk about making the Fund financially sound, this Government in the past five years have added—I have not looked at the figures—no less than some £200,000,000 to debt in connection with unemployment, only they have called it "grants to Public Assistance." Sometimes £ 150,000,000 or more a year has been found from the Exchequer direct, but they called it a grant; under previous Governments it used to be called a loan and added to the debt. That is the only difference. No doubt the right hon. Gentleman will answer that point, and I think I know the sort of little qualification that he is going to make, but it will not make any difference whatever to the general principle.

The crux of the situation is the large number of people who are outside the ambit of the insurance scheme, and also the large number of people who will miss even the smallest benefit which is being provided. I hope the right hon. Gentle-man will keep his hand firmly upon the Statutory Committee. It was only with very great hesitation in some quarters of the House that they were given their powers in 1934. There were misgivings, even on the benches behind the Government, at the setting up of such a committee. I agree with the criticism that there is a tendency to treat the committee as though their word were law and must be accepted. The right hon. Gentleman has power to refuse any recommendations that are made by them. I do not think he can alter the recommendations; he can either accept them or refuse them. I trust that the Minister, as the representative of this House and of the people, and particularly of the workers and employers who make the contributions, will make it clear to the Statutory Committee that this House is the master in this matter. I make the point, because I think that this House should make it clear on every possible occasion that the Unemployment Insurance Fund exists to succour and aid large masses of the people who are damaged by unemployment not only in normal times, but in extraordinary times. That being so, the first business of those who rule the Fund is to give human consideration to these people.

The right hon. Gentleman gave an explanation of the waiting period, and particularly of the five days and of the eight days. I was thankful that he was giving the explanation rather than I. He should do what the Minister of Health did last time, that is, stick to his brief. It is a very complicated matter indeed. The Minister of Health told us that we could read it the next day and thoroughly understand it. I would repeat that the one concern of the Fund, particularly in regard to a surplus, ought to be its extension to the people whose need is greatest, those who have been out of work for a long period. When next the Statutory Committee have a surplus at their disposal, as I am certain they will if they are as wrong next year in their calculations as they have been this year, I trust they will give some attention to people who are outside the ambit of the scheme, in order to bring in a larger number of people, and to give help where it is most needed and where the largest number of long-term unemployed are concentrated. We welcome the reduction of the six days to three, and we hope that the Minister will bring to the attention of the Statutory Committee the point that has been so insistently raised, both in my own speech and in other speeches. I am alarmed at the note I find in the Minority Report, and at the misunderstanding and lack of understanding on the part of members of the Statutory Committee, who are responsible for the maintenance of the unemployed in their time of need.

6.51 p.m.

The Parliamentary Secretary to the Ministry of Labour (Lieut.-Colonel Muir-head)

It is, perhaps, a tribute to the interest taken in the affairs of the Ministry of Labour that even when there appears to be almost unanimity, we can sustain a Debate of nearly three hours. I had intended to open with a few remarks on the subject of rubber stamps, but they have got somewhat: worn in the course of the Debate, so I will leave them alone. The right hon. Gentleman the Member for Wakefield (Mr. Greenwood) asked me to give, on behalf of my right hon. Friend, pledges on two subjects with regard to the future disposal of surplus. The first pledge was that none of the surplus would be applied to debt, and the second, that all the accruing surplus would be used for people who are out of work. If the right hon. Gentleman were in the position which my right hon. Friend holds, I do not know whether he would be prepared to give hypothetical pledges, not only on those points, but on points of that nature which might be put to him. But that itself is a hypothetical consideration at the moment. I am safe in saying that whatever my right hon. Friend may decide in future—his freedom to reject the advice of the Statutory Committee has been well emphasised in the course of the Debate—I am sure that he is not prepared to prejudge the consideration and the recommendation of the Advisory Committee, which, so far, has done such excellent work and has given such excellent advice.

The right hon. Gentleman raised also questions with regard to the agricultural scheme, as did the right hon. Gentleman the Member for North Cornwall (Sir F. Acland). I would remind hon. Members, although I think they appreciate it well enough themselves, that contributions have not been paid for the period of a year and that benefit has been given for only about four months. It is obviously far too early to make any sort of suggestion or promise, however qualified it may be. It is clear there is no power at the moment to alter the scheme in regard to the disposing of surplus because, in point of fact, the Statutory Committee have not declared any surplus for disposal. The hon. Member for Hemsworth (Mr. G. Griffiths)—I take notice of certain points which he raised—asked for information on the subject of the Easter holidays. He wanted to know how they would count for waiting days. The answer is that there is no change in consequence of the proposals at present before the House. Those holidays count as waiting days, but they do not count as benefit days. If the hon. Member bears that principle in mind, he will see how the holiday period applies in each particular case.

Mr. G. Griffiths

I suppose that the Friday, Saturday, Monday and Tuesday, that is, the Easter holiday, will not count as waiting days, but they may count as linking-up days with the waiting days?

Lieut.-Colonel Muirhead

They will count as waiting days, but they will not count as benefit days.

Mr. Buchanan

None of the four days will be paid for?

Lieut. - Colonel Muirhead

On the assumption that the holiday ends on Monday night, the Tuesday before Good Friday is the first day of which unemployment is proved, the first benefit day will be the following Tuesday. If Wednesday is the first day on which unemployment is proved, the first benefit day will be Tuesday again. In the case of Thursday, the first benefit day will again be the following Tuesday.

Mr. Buchanan

None of the four days will count for benefit, although they serve as the waiting period?

Lieut.-Colonel Muirhead

They do not count for benefit purposes, but only for waiting purposes.

Mr. Lawson

Is there an Umpire's decision on that point?

Lieut.-Colonel Muirhead

I do not know. The hon. Member for East Birkenhead (Mr. G. White) gave these proposals his approval. Appreciating as we do the practical experience he has had and the work which he has done, I can assure him that that approval is welcome. The hon. Member for Blackpool (Mr. R. Robinson) asked what would be the number of persons benefiting by another day. The estimated figure would be 16,000 who would benefit on any one day, but he will understand that that does not mean that in the course of the year only 16,000 individuals would feel the benefit. The number would be far greater. He also complained on the subject of seasonal workers. I do not think I could do better than repeat to him the supplementary answer given to his Parliamentary question as recently as 18th February. It was as follows: Mr. ROBINSON: Can the Minister give any figures in support of the statement that the position of seasonal workers is improving? Mr. BROWN: Yes, in the 12 months preceding that date the number of claims disallowed by the court of referees under the regulations was 18,435, and in the subsequent 12 months the number of disallowances was only 10,853. [OFFICIAL REPORT, 18th February, 1937; col. 1336, Vol. 320.] That is some indication of the benefit to seasonal workers under the recent seasonal workers' Order.

Mr. R. Robinson

I think the Parliamentary Secretary rather misunderstood my point. I gave the Government credit for improving the position of the seasonal worker, but my argument was that the job is only half done. I wanted him to review the position and to hold out some hope that the job might be completed in, the reasonably near future.

Lieut.-Colonel Muirhead

My experience is that very few jobs are fully done. The hon. Member for Gorbals (Mr. Buchanan) had his periodical complaint against the chairman of the Statutory Committee. He complained also about our spreading our calculations, and therefore our payments, over the eight-year period. It is true that we could live from hand to mouth, spending a pound when it appeared. That course can be pursued in private finances, but it often ends in disaster. The Government have no intention of pursuing that type of policy in regard to the public finances for which they are responsible. They have no desire to try and gain popularity by putting forward benefits which they cannot see their way within a reasonable period to sustain.

Mr. Buchanan

The year previous, the whole of the surplus was used in the year.

Lieut.-Colonel Muirhead

That was not so. It was disposed of on the same principle of an eight-year spread-over as is adopted this year. The Statutory Committee Report for 1935, paragraph 31, says: In the light of the conclusion reached above, it becomes our duty to make recommendations for the disposal of an annual surplus of about £6,500,000 a year. The money that was disposed of last year was not disposed of on any different principle from this year. If the hon. Member is trying to insinuate that on the basis of an eight-year spread-over we have this year £17,000,000 to dispose of he is wrong. The hon. Member for West Nottingham (Mr. Hay-day) tried to connect his remarks with those of the hon. Member for Gorbals. The hon. Member must realise that part of the money being disposed of now is an actual realised surplus, and part of it is money which we are dispersing in accordance with an assumption about next year. It is partly realised and partly estimated. When you go on a basis like that there is bound to be a good deal of diversity of opinion as to the basis on which you should make your calculation, but no one can say that at one and the same time you can have all the benefits of assuming that you are giving yourself a surplus in a particular year and avoid the demerit of spreading it over eight years.

Mr. Hayday

You estimate there will be £12,275,000 for 1937, and you estimate on the basis of 80 per cent. of that amount, which is £9,820,000. That is not eight years, that is one year.

Lieut.-Colonel Muirhead

You cannot assume that your benefit will be the same for eight years. You have to take into consideration not only your estimated increases but also the estimated demands that are likely to be made. It is true there is nothing particularly sacrosanct about eight years, but on the fundamental principle on which the Statutory Committee works there can be no serious disagreement. The hon. Member for North Kensington (Mr. Duncan) asked what would be the benefit in the present proposals for people who had been insured for 30 years. Of course, nobody has yet been insured for 30 years, but taking a man who has been long insured, he will benefit to the extent of nine weeks extra benefit. The hon. Member for the English Universities (Miss Rathbone) I thought came in just before she spoke and went out again almost immediately afterwards. Her waiting period seemed to be negligible, but I see she has come in again for benefit. I cannot do better than take refuge behind the women members of the committee, who agreed with the majority report. As the hon. Lady said that women are less articulate than men, I will try to disprove her statement and say no more about it.

Miss Rathbone

Will the Parliamentary Secretary give us some reason to hope that the women's claim will be considered next time? The cost of the small alteration I asked for would be only £1,000,000 a year, and would not be a heavy additional claim.

Lieut.-Colonel Muirhead

The point has been discussed, and hope never did any harm. The hon. Member for Stoke-on-Trent (Mr. Ellis Smith) said that the National Confederation of Employers' Associations dictated the way in which this money has been disposed of. He cannot justify that in view of paragraph 45 of the report, which states: The National Confederation of Employers' Associations urged that reduction of contributions should be regarded as a first charge on any surplus that might become available, until contributions have reached a level of 6d. a week from each party for an adult workman, as compared with the rod fixed in 1931 and the 9d. now in force. That was the contention put forward this year by the Confederation, and it was not proceeded with. The hon. Member for Chester-le-Street (Mr. Lawson) tried to make out that we were just as profligate on unemployment expenditure as his Government had been. The answer really is not a queestion of pounds, shillings and pence. It lies in the view that the people of this country and of the world take of the credit of the British Government, and on that there can be no argument. The hon. Member for Gorbals (Mr. Buchanan) said that my right hon. Friend had all the luck. Napoleon once said that he did not want good Generals, he wanted lucky ones. I think he said that because what often appears to be luck is, in fact, efficiency.

Question put, and agreed to.

Resolved, That the draft of the Unemployment Insurance (Additional Days and Waiting Period) Order, 1937, laid before Parliament on the twenty-third day of February in pursuance of the provisions of Sub-section (4) of Section 59 of the Unemployment Insurance Act, 1935, be approved.