CLAUSE 2.—(Lump sum payments.) (Hansard, 5 November 1943)

§ Mr. Foster
I beg to move, in page 3, line 11, to leave out "seven", and to insert "nine".
I hope that neither the Home Secretary nor the Under-Secretary will seek to bring Sir William Beveridge to their aid in resisting this Amendment as they have successfully done in resisting other Amendments to this Bill. I do not think they will be able to do so in this case. The Amendment seeks to increase the maximum compensation from £600 to £900 instead of from £600 to £700 as proposed 994 in the Bill. The maximum of £600 was made up of two lump-sum amounts—£300 being the maximum for the widow who was wholly dependent upon her husband and the other £300 being the maximum in regard to dependent children's allowance. What the Home Secretary has done has been to raise the widow's maximum from £300 to £400, and to make no increase in the remaining £300 in respect of the children's allowances. I do not know why that has been done, because, in the first place, in the weekly payment, if you take an average family of three children, there is an increase of 37 per cent. in the children's allowances in the case of an injured workman. It is rather strange that an increase should be given in the case of total incapacity or partial incapacity but no increase when there is a fatal accident. I cannot understand that at all. In the Second Reading Debate the Home Secretary made a statement which I will quote. He said: If, however, the lump sum payable to an adult dependant is less than the maximum of £400, the difference up to £700 can be used to increase the amount payable in respect of the children." [OFFICTAL REPORT, 21st October, 1943; col. 1547, Vol. 392.] I rather question that statement. My interpretation of the 1925 Act is that £600 is payable in two separate sums of £300 each, and you cannot use any of the first £300 for children's allowances. If that same principle is applied to the sum of £400 in the present Bill, we shall not be allowed to use that for children's allowances. Perhaps the Home Secretary or the Under-Secretary will answer that point. Those who have had anything to do with the working of the 1925 Act know that the method adopted when arriving at some settlement is to take the average weekly earnings, which are at present limited to £2, and multiply them by three years, that is, by 156 weeks. You cannot exceed £300 in the case of the widow or £300 in the case of the children. By increasing the Loco for the widow to £400 the previous earnings of £2 will become £2 11s. 3d., because 156 times that makes £400. The children's allowances are fixed at 15 per cent. of the average weekly earnings. At present that means 6s., and it is 6s. a week for every week that the child is short of 15 years of age. By increasing the widow's compensation from £300 to £400 the £2 per week becomes £2 11s. 3d. and the 15 per cent. is raised from 6s. to 7s. 8d. In order to obtain the 995 present maximum of £300 for the children, you must take 1,000 weeks at 6s. By introducing this increased compensation for the widow you are cutting out in the case of the big family a matter of 127 weeks which come into the calculation at the present time. In a word, you have reduced the 1,000 weeks to 783 by raising the 15 per cent. from 6s. to 7s. 8d.
That, in my opinion, is an injustice to the big families. It cuts out children who otherwise would be paid because you are not able to exceed £300. My main point is that there is no increase in children's allowances if the widow is entitled to £400. There is a little doubt about the position if the widow is not entitled to £300, because of the Home Secretary's statement, but that point can be cleared up. The point of the Amendment is that we cannot see why there should be an increase in children's allowances of 37 per cent. in cases of total incapacity but no increase in cases of fatal accident. I do not know whether the experts in the Home Office have gone into the matter minutely. The Home Secretary said that the 1925 Act was complicated. I do not know of any Act so complicated and bristling with so many difficulties. The proposed method of increasing compensation will make the law still more complicated. The workman will not be able to understand why, if it is fair to give increased allowances for children in cases of incapacity, there should be no increase in cases of fatal accident.

§ Mr. T. J. Brooks (Rothwell)
May I ask a question, because I think there may be a wrong impression? Are we to understand from the remarks made by the hon. Member for Wigan (Mr. Foster) that there must be an increase in earnings to allow a dependant to get £400? Must there be an increase in earnings to get that?

§ Mr. H. Morrison
On the point just raised, it is perfectly true that there is a relationship to earnings in the case of the widow. On the other hand, as the minimum is increased and the maximum is increased, it is tolerably certain that the widow will be better off than under earlier legislation. The hon. Member for Wigan (Mr. Foster) put his point very fairly and clearly, but I am not myself quite clear on one point. I could not quite follow his argument about 783 weeks.

§ Mr. Foster
Under the present Act £300 is the maximum for children. To get that, we must have 1,000 weeks for all the children at 6s. a week. By increasing the widow's compensation from £300 to £400, if the widow gets the maximum amount, you must divide it by 156, which increases the average weekly earnings from to £2 11s. 3d. That gives the increase of 15 per cent. and raises the 6s. to 7s. 8d. Therefore, it reduces the 1,000 weeks to 783 weeks to make up £300. You cut out 127 weeks which at present are brought into the calculation.

§ Mr. H. Morrison
The unfortunate circumstance is that the only person on the Treasury bench who is at all capable of giving satisfaction, with the technical knowledge of my hon. Friend, is my right hon. Friend the Under-Secretary, and I happen to be replying to this Amendment. It is most unfortunate. If my hon. Friend would have a talk with the Under-Secretary, I am sure they would agree upon the facts, but my right hon. Friend assures me that on the present level of earnings the widow is pretty certain to be better off under these proposals because of the maximum addition which she will tend to get under this Bill. We believe that that will be the tendency, and we think that that will probably be so.

§ Mr. Foster
The right hon. Gentleman is making the position worse by putting out the 27 weeks which, under the present Act, are taken into consideration.

§ Mr. Morrison
I think the best thing is for me to drop this chapter and leave it to my right hon. Friend, who may say a word or two after I sit down, because I would like the point to be cleared up if possible. On the main point—and my hon. Friend has stated it truthfully and accurately—we have increased the maximum in respect of the widow from £300 to £400, and we have also increased the minimum. We have left the children's allotment where it was except for this point, with which my hon. Friend is agreed, that, if the widow does not get £400, then, such sum as is not spent on the widow can be spent on the children, subject to the over-all maximum of £700. My hon. Friend would like to know the reason for there being no increase in respect of the children, and I will tell him. The calculation is that on the basis of 6s. per child per week we get 997 to the maximum of £300 by some mathematical reasoning. It is true that, if there are several young children of school age, the average of 6s. per week would be reduced, and therefore they would not be credited with the full amount. But the change in the circumstances since the Act of 1924 is the Widows', Orphans' and Old Age Contributory Pensions Act, which provided for the first time 5s. for the first child and 3s. for each additional child. We thought it would not be right, having regard to that useful provision, that we should in this present legislation increase the provision in respect of children except by the fortuitous circumstances I have mentioned and to which my hon. Friend has also agreed.

§ Mr. Foster
I would like the Home Secretary to have in his mind that the lump sum which has been obtained and paid into court becomes exhausted after a certain period, and a widow is then left with her 10s. a week under the Widows' and Orphans' Pensions Act. That pension continues as long as she remains unmarried, but the lump sum becomes exhausted, and I would like my right hon. Friend to have that fact in mind.

§ Mr. Morrison
That is the evil of the lump-sum system. In these circumstances she will have received the compensation in respect of the children. She will go on getting certain payments as the widowed mother of children under the Act which I have mentioned, but once the £200 has gone she is back where she was unless she happens to have been lucky enough to have invested the money in a small business in which she is doing well. But I am afraid there are many cases in which such people invest the money in small businesses and do not do well. We think what we are providing will be fair and equitable, and certainly it is an improvement on things as they were. I will be frank with the Committee. There are differing opinions about it, but, frankly, I do not like this lump-sum business at all except in small cases where a small amount is involved and you can clear it off the books and do it fairly. It would be well in my judgment, to terminate, subject to those exceptions, the lump-sum system altogether and to provide for continuing allowances. That is what I personally would prefer, but I am afraid that I cannot suddenly pitch it into this temporary emergency legislation. 998 In the circumstances I hope that my hon. Friends will feel that they need not press the Amendment.

§ Mr. McEntee (Walthamstow, West)
The Home Secretary mentioned earlier that employers' liability was closely associated with workmen's compensation and that later on there would be a change-over because of the principles in "the Beveridge Report for social legislation. Now he has told us the reason why the children do not get any increase in the lump-sum is because they get it under social legislation. If that principle is to be continued, will it not be relieving employers entirely of the responsibility for providing compensation for workmen who are injured in their employment and transferring to the State the responsibility of the employers?

§ The Deputy-Chairman (Mr. Charles Williams)
That point might come in somewhere in the Bill, but definitely it does not come in on this Amendment.

§ Mr. McEntee
I understand that it is not the Amendment but the Clause that we are discussing.

§ The Deputy-Chairman
No.

§ Mr. Foster
In view of the explanation which has been given by the Home Secretary, I beg to ask leave to withdraw the Amendment and to say that I am very glad indeed that he will consult Sir William Beveridge on this matter.

§ Mr. Foster
I beg to move, in page 3, line 28, at the end, to add: (5) In paragraph (v) of subsection (2) of Section eight of the Workmen's Compensation Act, 1925 (which provides for reasonable expenses for medical attendance and burial) for the word 'fifteen,' there shall be substituted the word 'thirty.' We do not feel that £15 to-day is adequate to meet the funeral expenses in the case where there are no dependants. I have many cases in mind where the funeral expenses may have reached even as much as £40. Some people may think that that is an extravagant amount in working-class homes, but working people, when there is a death in the family, generally like to give the deceased a decent burial. I do not think that it is possible to do that to-day for £15, and we are asking the Home Secretary whether he cannot raise it to £30.

§ Mr. Tom Brown
I wish to support the contention that has been put forward by my hon. Friend the Member for Wigan (Mr. Foster). The Home Secretary will appreciate that since the £15 was inserted in the 1925 Act there has £15 a considerable increase in all the fees that appertain to laying to rest men who have been killed in the pits, and I maintain that on economic grounds the figure mentioned in the Amendment should be conceded by the Home Secretary.

§ Mr. T. J. Brooks
If the Home Secretary feels that he is not able to adopt the amount of would he be good enough to say whether he could give a figure somewhat less than £30? I have had a good deal of experience of funerals where there have been no dependants, and it is not possible to give a Christian burial for £15. We do not want our people to be buried as paupers, and that is what the right hon. Gentleman will be doing if the present amount remains in the Bill. Costs have gone up tremendously. You cannot get a decent coffin to-day under £10 or £12, and where there is no family left it leaves somebody in debt if he has to help to pay for the burial. This is not right.

§ Mr. Peake
This is a matter which we discussed fully in the course of our meetings with the representatives of the Trades Union Congress. The figure of £15 which is operating to-day is the maximum for the funeral expenses where there are no dependants. It is suggested in the Amendment that that figure should be increased to a maximum of £30. I again hesitate to refer to the Beveridge Report, but that Report deals comprehensively with a proposal for funeral benefits, and while that Report stands before the country and the House and while discussions upon which proposals should be adopted are being undertaken by the Government, there did not seem to us to be a case for any alteration in the existing figure. The figure proposed by Sir William Beveridge in the case of adults for funeral benefit was £20. Most of the cases where there are no dependants and where this funeral benefit applies are cases of youths in the mining industry, and in respect of youths Sir William Beveridge's figure is something below £20. There is a sliding scale. The evidence before the Beveridge Committee on this point is interesting. It shows that in 1922, when the Departmental Committee on Industrial Assurance were sitting, the 1000 cost of a funeral was given by the representatives of the Undertakers' Association as £15 in London for an adult and £13 in other industrial centres.

§ Mr. Foster
What sort of a funeral?

§ Mr. Peake
The hon. Member says, "What sort of a funeral?" There was further evidence before this Committee, it is stated by Sir William Beveridge, which shows that a great public authority, like that over which my right hon. Friend presided with such distinction for many years, provides, I am told, a very adequate funeral for the small figure of £7 10s. I am told that it is quite a good funeral for that figure.

§ Mr. Maxton (Glasgow, Bridgeton)
Does the right hon. Gentleman know what a bottle of whisky costs?

§ Mr. Peake
We were talking of funerals in London, not in Scotland. The discussions we had on this matter with the representatives of the Trades Union Congress led me to believe—I am not sure whether they were persuaded or not—that if we were to increase this overriding maximum figure at the present time, most of the benefit would go to the undertakers. The usual question when a burial has to take place is, "How much money are you insured for? How much money have you got?" The funeral is the same whether the insurance money is £10, £20 or £30. For that reason, and in view of the fact that the whole question of funeral benefit for everybody is now under consideration, we thought that we had better leave the figure where it is at the present time.

§ Mr. Foster
It is with regret that I beg to ask leave to withdraw the Amendment, because I do not think a case has been made out against it. One could answer the Government's reply, but in view of the situation which presents itself I will withdraw the Amendment.