MANPOWER (INSURANCE AGENTS) (Hansard, 16 May 1947)

§ Mr. Mack (Newcastle-under-Lyme)
The concluding speech of the hon. Member for East Aberdeen (Mr. Boothby) in the Debate which has just ended was, indeed, almost an all-time record. He set an example of exactitude in time, and I will endeavour to be equally exact in the facts I wish to present to the House in respect of the insurance industry. I say at once, that I refer to industrial insurance. This industry is one of the greatest in the country. It employs, at a rough computation, something like 65.000 men as an outdoor staff, agents who are loyal, who are, on the whole, extremely efficient, and who are skilled in their work. It has been stated in connection with this industry that in 1942 there were over 90 million paying policies in existence, and that £77 million per annum was collected in premiums. Today, the figures are considerably in excess of that.
There has been a great deal of perturbation and anxiety lately in the breasts of these agents in regard to the manpower position. It will be remembered that in the Government White Paper, the Economic Survey of 1947, the Prime Minister made a spirited appeal to the nation to conserve manpower as far as possible, and to direct it into those industries which were most essential to the nation. In that spirit, the insurance agents, through their unions and organisations, co-operated to the full. But now we find that certain offices are taking advantage of the position in starting what are known as spare-time or part-time agencies, using men who have possibly had no previous experience of the business, no doubt with a view, because of the great increase in industrial insurance, of employing these men in a drive for a further increase and, incidentally, further profits.
1968 The stand taken up by the unions, and my own union in particular, is that there should be no recruitment for new labour at all, because we contend that the existing outdoor staff is adequately and sufficiently skilled and able to deal with the existing business. Only a few weeks ago, I put a Question to the Minister of Labour in connection with the Co-operative Insurance Society. Here we are in a difficult position, because the C.I.S., which, after all, is associated with the Labour Movement through the Co-operative Movement, should normally have set a good example to the industry. The difficulty there has been that they have been starting on blank books. In other words, they have been recruiting from the already reduced stock of labour for the purpose of increasing their collectable debts. Recently this practice has been stopped. The Chairman of the C.I.S. in a recent speech spoke of the record of phenomenal progress which the Society made in 1946. Yet in the Government's survey of 1947, in paragraph 124, we read that the prospective force of 18,300,000 labour power is falling substantially short of what is needed to reach national objectives. The Government, therefore, appeal to workers, in this case women, to enter industry and to augment that number.
In spite of that appeal, and in spite of protests by the unions, what do we find? I have before me some facts which are very enlightening. In the C.I.S., Hammersmith district, a £28 book—that means a book which collects £28 weekly—is split into two books of £14 each; and, therefore, the minimum wage is only That minimum wage does not mean merely the collecting of a £14 book. It includes ordinary branch insurance, and special branch and general branch. From that £4 which the agent receives, if he is on the minimum, there are deducted loan repayments he has undertaken as a result of purchase of the book, health insurance and superannuation. So we have the position that those offices which should have set a good example to the whole of industry are, in certain cases, starting men, not only on split-up books, but by paying them rates of remuneration which we consider entirely inadequate. I have a letter written by Mr. Frank Crump, of the National Amalgamated Union of Life Assurance Workers, in which he complains to the manager of the Co-operative Insurance Society that they are opening 1969 up new offices in certain outlying districts of London. He referred to the fact that the Royal London and the Liverpool Victoria, by contrast, are closing many offices, which is evidence, he declares, that progress is not necessarily dependent on an increase in the number of district offices. So he considers the action of the C.I.S. all the more regrettable, and adds his strong protest, and he stated his intention of raising the matter in trade union and co-operative circles. All that is certainly anti-social, and is opposed to the spirit of the Government's policy.
One of the difficulties with which we have to contend in the insurance industry is the fact that there is an excessive number of insurance undertakings. There is fierce competition in the business. In the 28th annual report of the Insurance Unemployment Board we were told that in 1939—I have not comparable figures for today, and they may be less—there were 352 ordinary life offices and general insurance companies; there were 50 industrial companies and friendly societies; 299 separate employers societies, according to Lloyds; 434 friendly societies, and miscellaneous organisations a total of 1,887 separate employers making returns. We contend that that is an excessive number of organisations catering for insurance, and that it is an excessive drain upon manpower. When we come to spare and part-time agents we come to a very difficult position. They work on prospects, and they draw commission for their prospects, and leave the real service to other people to do—the clerical work and the service connected with the business. It has been computed—no one can get an accurate figure—that hundreds of thousands of people are engaged as spare-time and part-time agents. We contend that the existing staff is more than able to deal with the business, because of their special aptitude; and that it is our imperative duty to economise on manpower today, in view of the urgent need of the nation, and in view of the call made insistently by the Government that all available manpower should be kept for purposes which are directed to the national need. Of this insurance business let me say, that it is a very important industry.
It encourages thrift, and the Kennet Committee very rightly paid a compliment to them in 1942. They stated that 1970 thrift was to be encouraged, and that because people put by large sums of money in securities of one kind or another they thus saved the country from inflation. Thrift should certainly be encouraged, and to that end it is desirable that this industry should continue
What agents complain about is the large number of people, without previous experience, being used by certain offices for ulterior purposes, to force down the standard of living of the workers. The Prudential does over one-third of the insurance business in this country. They built this vast business over the bodies of thousands of workers who were often dismissed unceremoniously when they failed to get the necessary increases. Until recently the Prudential would not encourage new entrants over the age of 25, because they wanted to get them young to train them to get all the possible business they could. It is partly for this reason that they have obtained their present success.
I will mention one particular instance which occurred to me, which I repeat with regret. As an agent of the Liver Friendly Society, I found myself shortly before the war in Scotland at the annual delegate meeting with a sandwich board on my back protesting against the employment of part-time and spare-time agents, averaging 15s. 6d. a week. For that deed I paid a heavy price. It is true that the committee of management did not deal with me then as they would have liked but later on they trumped up some charge of writing an article in a trade union journal which they all said was derogatory to the good name of the committee, suggesting that they had no brains and ability with which to carry on their business. They sacked me, and I am glad to know that these were the circumstances in which I got my dismissal. As far as I know, I became the first Member to enter this House with an unemployment paper in my hand, no doubt because of my action in fighting against spare-time and part-time agents. The Royal Liver Friendly Society, although they should have set a better example, have permitted this practice for a number of years.
I have a letter here which is a disgrace and a scandal, which will touch the heart of my hon. Friend who has fought as a trade unionist the whole of his life. It concerns a fellow countryman of his, Mr. T. G. Davies, of Llanelly. He is an ex- 1971 miner who suffers from pneumoconiosis, which I understand is another name for silicosis. He went into the industry as an agent, and he was recently dismissed by the Refuge Assurance Company. He was dismissed in spite of the manpower position of the country. He served the company well for three years and had been declared medically fit by a qualified practitioner and should normally be able to carry on as an insurance agent for perhaps 15 years. This man is being displaced, not because his book is required for a returning ex-Serviceman, to which we would have no objection, but with the intention of employing a new agent drawn from the very restricted labour market. I contend that there are many cases where a man may not be fit enough to carry on as a miner, and in the more hazardous and physical occupations but, nevertheless, could very well become a good insurance agent, and be fit enough to carry on that job. It is very wrong to call upon the restricted manpower in order to enable the insurance offices unduly to expand their business and make further profits as a result.
The Refuge Company had the audacity to do what I think is a monstrous thing. When a delegate was recently appointed to the annual conference in Blackpool of my own union, they refused him permission to attend for a couple of days. This was because they are fundamentally opposed to trade unionism, unless they can get a milk-and-water union of their own type which will carry out their wishes. I trust That my hon. Friend the Parliamentary Secretary will appreciate that I am doing everything possible to assist him, and his Department in particular, in conserving manpower. Paragraph 127 of the Economic Survey says: Consumer services…are tending to attract too much of the manpower that is becoming available as the result of demobilisation, and it is of the utmost importance that only moderate increases should occur in those services in the immediate future. If that is so, then we have a very good case, and it would be wise for the Government, through its spokesmen, and particularly through the spokesmen of the Ministry of Labour, categorically and clearly to state this afternoon that they do not favour this particular type of recruitment.
Finally, I wish to make one reference to the Kennett Committee of 1942. This 1972 Committee said that no persons, however designated, should be employed wholly or principally in canvassing for new business. We object to this wastage of manpower. We say that we want to build up the books of the agents to a reasonable size, without overloading. The agents themselves should by discussions, with the offices, be able to build up the books in order to provide a minimum wage of £5 a week, which we regard as the lowest possible figure consistent with a decent standard of life. We are willing to back them in doing that. We are fighting on the true principles of trade unionism. We do not want this industry to be abused and brutalised. In the case of the London and Manchester Insurance Company—one of the worst and most reactionary offices—the minimum wage is £3 10s. a week. We believe that a £5 minimum is the irreducible minimum which should be given to the workers. It is because of these conditions that I raise my voice in protest against the action of some of the offices, and I hope that the Minister of Labour will do everything possible to support the justifiable case which I have been making on the workers' account.

§ Mr. Beechman (St. Ives)
I appreciate the enthusiasm of the hon. Member for Newcastle-under-Lyme (Mr. Mack), but I am afraid that it has rather carried him away to make the most fanciful allegations about the industrial insurance companies who, as he must know, are co-operating magnificently—

§ Mr. Mack
Not all of them.

§ Mr. Beechman
—to assist the Government to make the National Insurance Act the success we all wish it to be. Let me congratulate the Government on the Commonwealth Conference which is now taking place, and which is to make national insurance reciprocal. I would like to give the House one or two figures so as to correct the extraordinary impression which the hon. Member has just given us. He spoke about the outdoor staffs having been increased beyond all measure. Let us take the Pearl Insurance Company, for example. In 1939, its outdoor staff amounted to 10,258 and, in 1946, it was 7,666. At the same time, every man on this reduced staff is collecting far more, is doing far more work, than his predecessor before the war. In 1939 the total 1973 collection per man per week was £23 2s., and now it is £43 7s. Let me give similar figures for the Royal London Mutual. In 1939 the staff was 8,205, now it is 6,517, and once again the services rendered by each man have greatly increased. In 1939 the total collection was £15 7s. —

§ Mr. Beechman
No, I am not giving way. In 1939 the total weekly collection was £15 7s., and now it is £30 12S. It is the same with the Prudential to which the hon. Gentleman referred. The collection has increased per man from about £39 to £51. The Prudential Approved Societies have engaged 561 people in Torquay. What to do? To deal with work for the Ministry of National Insurance in connection with the new Act. It is the same with the National Amalgamated Approved Society, which has engaged 500 people—and, I may say, out of 2,700 applicants, of whom only 5 per cent. or less were in work. This is in order to copy out the records needed by the Ministry of National Insurance. My last word, as the Parliamentary Secretary wants to reply, is this. The hon. Gentleman opposite referred to the personnel engaged in this work, and I happen to know that in its staff at Torquay the Prudential employs over three times the statutory number of disabled persons—it employs something like II per cent. I should like to say more, but I will make room for the Parliamentary Secretary.

§ The Parliamentary Secretary to the Ministry of Labour (Mr. Ness Edwards)
It is rather a pity that my hon. Friend the Member for Newcastle-under-Lyme (Mr. Mack) wandered away from the matter which was really set down for discussion on this Adjournment Debate. His purpose, I understood, was to deal with the deployment of manpower, and he was bringing a general charge that the insurance industry was absorbing a far greater proportion of our very scarce manpower than it should be. He went on to discuss the introduction of the blank book arrangement with regard to a number of companies. In general, the insurance companies are helping us in picking up the surplus money. It is an anti-inflationary movement and one must give credit to them—

§ Mr. Mack
I accept that.

§ Mr. Ness Edwards
—for the way in which they are helping the Government in these very difficult days. That, however, is not an unmixed blessing. As to the general principle of life insurance residing in the hands of private profit companies, that is another matter, which of course we have not time to discuss today.
I would like to give the House an indication of what the real figures are. In 1939 the number engaged in the industry was roughly 123,000. In 1943 it was 129,000, in 1944 121,000, in 1945, 117,000, and in 1946, 135,000. In the general manpower situation, that is a dangerous tendency. The more people we have on production in proportion to those engaged in distribution and in services, the richer will this country be, and the higher will be our standard of living.

§ Mr. Beechman
I am sure the Parliamentary Secretary appreciates that the outdoor workers I mentioned are paying National Health benefits and doing other work that has to be done by somebody to maintain a foundation for the National Insurance Act?

§ Mr. Ness Edwards
I quite appreciate that numbers of these men may be engaged in services connected with the Ministry of National Insurance as has been suggested by the hon. Member for St. Ives (Mr. Beechman), but I can assure him that in the figure for 1946 not so many of them are included. There are some, but it is well to remember that in 1946 there were not so many as there are today. I have not the up-to-date figures, but the Ministry has built up a labour force since in consequence of legislation passed by this House. I come now to the point of complaints in connection with the methods of certain insurance companies. I much deplore this tendency to put men on the streets with a blank book, but I must ask my hon. Friend to realise that the protection of the people engaged in the insurance industry is a matter for their organisation. We will never get anywhere in industrial relationships by bringing disputes on to the Floor of this House which ought to be hammered out between the employers and the employees.

§ Mr. Mack
Unfortunately we cannot do that, because we are not recognised as a trade union by this particular company.

§ Mr. Ness Edwards
That is a matter which cannot be settled on the Floor of this House. It must be settled within the industries. Other industries have had to do it and this House cannot put down a carpet to enable those engaged in the insurance world to get ordinary recognition. We should give them all the assistance that we can. There is in the Ministry an industrial relations department and any assistance that the Ministry can give in dealing with this matter if invited by the unions will be given. As an old industrial fighter I deprecate bringing on to the Floor of the House of Commons matters which ought to be settled in the board rooms and in the negotiating chambers, between both sides of the industry. We will never get anywhere by that method, and we must settle our problems in the normal way.
I come to the question of the undue proportion of manpower that this industry appears to be absorbing. I have been asked by my hon. Friend to take steps to stop it. That is asking either for control of labour or for direction of labour, against which this House has set its face. We are no more entitled to stop a man securing employment in the insurance industry than we can stop a man taking employment with the dogs or with the horses. It may be that in the urgency of discharging some of the social tasks which lie before us we may be led to the conclusion that 1976 some methods may have to be devised whereby we can correct the employment of our manpower so that first things shall be done first and men shall be placed in the most urgent places. So far we have not envisaged that situation, and I cannot say anything more about it.
I deplore this pitching of men on to the streets with a blank book and saying to them, "Get your living the best way you can." However, I say that the correct steps towards the prevention of that does not rest with the House but with the organised workers in that industry, and to the extent that this House does the work of the unions to that extent do we weaken the power of the unions and render them unfit to do their job. It is a difficult job and they must get all the encouragement that we can give them. I am alive to what was said in the Kennet Committee's report. I have read it and I realise that insurance is a valuable addition to the national life. We want to encourage that in the interests of the nation but not in the interest of any particular company or individual. Having said these things I hope my hon. Friend will be satisfied that his time spent this afternoon has been worth while.