HC Deb 14 July 1948 vol 453 cc1336-50

10.49 p.m.

Mr. Cove (Aberavon)

I beg to move, That an humble Address be presented to His Majesty, praying that the Regulations, dated 29th June, 1948, entitled the National Insurance (Contributions) Regulations, 1948 (S.I., 1948, No. 1417), a copy of which was presented on 30th June, be annulled. We are not to-night criticising the whole of these regulations embodied in No. 1417. We are, however, deeply concerned about Regulation 7, which applies to students and those who are receiving training as apprentices. Students who are in school up to the age of 18 will have their contributions credited, but apparently after the age of 18 the National Advisory Committee have recommended, and as far as one can understand the very complicated regulations, and the regulations seem to follow the recommendation, students who are in college and apprentices should have an option to pay or not to pay contributions. By the way, I hope the Minister will be able to persuade the Department to be much more simple in future regulations than they are in these, for I find them and indeed legal experts have found them very difficult to understand. The National Advisory Committee in their report, say that there is a case for the representations that have been made that students over 18 should have the contributions credited. But they say, after admitting that there is a substantial case, that if students over 18 have contributions credited, that may break down what they term the principle of universality. That means, I suppose, in common parlance, that some measure of favouritism will be granted to students over 18 if they have their contributions credited.

I should like to make one or two observations about that. One is, and I think it stands out very clearly, that if contributions can be credited for going to school up to 18, what prevents the prin- cipal being applied after 18? The principle of crediting contributions has been conceded to those who go to school, and I and my hon. Friends associated with me say clearly and distinctly that, not only in the interest of the students themselves, but in the national interest, students who go to colleges and to the universities should also have their contributions credited. But the principle of universality is broken down by the National Advisory Committee itself, and by the regulations which incorporate their suggestion by the very fact that an option is offered. What does that mean? What it really means in practice is that those students who can afford to pay the contributions will be able to pay and those who cannot afford to pay contributions will not pay. So there, by the very fact that the regulations have embodied this, the principle of option, the very principle of universality and equality for which, I understand, the National Advisory Committee and the regulations stand, breaks down. So that goes by the board.

I am not going to deal in detail with the matter—I am going to leave it with my hon. Friends; we have agreed to a division of labour. I think the Minister will admit that if a student does not pay during his college or university career, and if he marries and dies about the age of 30, considerable disability will be inflicted upon the widow. Her pension will be less. The retirement pension will also be less because of the basis of 50 contributions a year. We stand clearly for crediting contributions during the period of college or university life. It may be said, and I have heard it stated, that an injustice will be inflicted upon other sections of the community. I suppose there must have been actuarial calculations in regard to this class of contributor and it may be said they show that, if these students are credited with contributions during the period of college or university or apprenticeship careers, they will constitute an added burden on the Fund, and that other sections of the community will have to pay for it.

This class of person, and particularly those who go into the various professions will, under the scheme pay for benefits which they will probably never receive. They should pay, but the fact is that a certain amount of the contribution is allo- cated for unemployment benefit, and this class of person will not suffer unemployment to any degree. They will thus be paying for a benefit which, fortunately in one sense, they will not receive. Then, again, and I take my experience from a very successful approved society—this is a class which brings credit and not debit to the fund. The society to which I refer is the National Union of Teachers' Approved Society, and it was very successful under the old regime. It had magnificent additional benefits; they were some of the finest ever paid by any approved society. That was due to two reasons; there was efficient and economical control, and the incidence of sickness was less. It is clear from my experience that any actuarial valuation must take into account the fact that this class of person brings credit to the Fund and the credits during the period of college or university training mean that, over the long range of years, these people will not be a burden on that Fund.

At this late hour, I do not want to prolong the discussion, but I am not quite clear on one point, and I should be glad if the Minister would say something about it. It is the position of those in the emergency training colleges. So far as I understand, those in the emergency training colleges who have fulfilled certain conditions in the past, will have their periods in the colleges credited; those who come in in the future will not have their credits for that period. If that is so, it seems to me a complete injustice to those who are coming into the emergency training colleges in the future, if only for the reason that a great many of them would have been in the training colleges had there been vacancies. We are penalising these men and women, not because of any fault of their own, but because the necessary accommodation for their training has not been provided.

I am not being nasty with the Minister tonight—we are two Welshmen together—but I hope he will be able to give some indication that the matter will be reconsidered from the point of view of crediting these men and women with their contributions during the period that they undergo training. We are glad to take part in this magnificent scheme. In some respects it will aid professional people like teachers even more than the ordinary working men and women. Take, for instance, a teacher who breaks down and receives a "breakdown pension" under the teachers' pension scheme. We have always said that has never been sufficient to keep a teacher in a satisfactory standard of living, particularly if the breakdown occurs in middle life. The fact that you can have continuous sick pay thoughout your life, if the conditions are satisfied, is a great advantage.

We appreciate this, and we are proud to join in the scheme, but we do say that from the point of view of individual hardship, not only to the students but also to the working-class parents who make sacrifices to enable them to go to college, these contributions should be credited to them. There is also the national point of view. We shall need an increasing flow of men and women into the colleges and universities, and I hope it will be possible to say that the added burden of paying these contributions will not be a bar to that stream getting wider and bigger. Therefore, in the national interest also, I hope the Minister will be able to consider sympathetically the point we are putting to him.

11.4 p.m.

Mr. Ralph Morley (Southampton)

I beg to second the Motion.

As my hon. Friend has said, and so far as I understand the regulations—which I agree are drawn in an extemely complicated manner—a full-time student up to 18 will have contributions under the insurance scheme credited to him, but after that age he will have the option of either paying or not paying the contributions. We know students pretty well—most of us have been students in the past—and we are well aware that the young man in the spring-time of life, at the age of 19, thinks the age of 65 is a very long way off, and sometimes in moments of despondency believes he will never reach it. As for the young woman student in college at the age of 19, she is quite certain that a year or two after she leaves college she will be married. If anybody tried to persuade her to the contrary she would regard him, I have no doubt, as a very odious person.

So, undoubtedly, I think that if this option is given to the students in our colleges and universities the majority of them will select the option not to pay the contributions. If they select the option not to pay they will be considerably endamaged so far as the benefits are concerned, because it is a regulation under the Act that in order to qualify for full benefit a man or woman must have an average of 50 contributions each year for the whole period of contributory insurance.

Take the case of a student who goes to college for two years; and let us say he is preparing to train as a teacher. If he takes the option not to pay the contribution during those two years he will be 104 contributions short. By the time that he arrives at 65 he will not have been able to make up that loss of 104 contributions. He will have only an average of 49 contributions over his contributory period. His pension will not be 26s. a week but 25s. The student trained for four years will be in a worse position still, because he will have lost 208 contributions, and by the time he arrives at 65 he will have had an average of only 46 contributions for each year of his contributory period. His pension will be 24s. a week instead of 26s. a week.

The case, as my hon. Friend indicated, with regard to the widow's pension is still worse. Take a student who spends four years at a university and does not contribute under the option during those four years. Suppose that after he leaves the university he gets married, and dies, let us say, at the age of 32, leaving a widow and a child. Over that period he will have had an average of only 35 contributions for each year, on account of the four years' loss of contributions during the time he was at the university. His widow and orphan will have, instead of a pension of 33s. 6d. a week a pension of 24s. 6d., or 9s. loss per week. So that the students who take the option—and I fear that most of them will—not to pay the contributions will be very considerably endamaged.

As my hon. Friend has said, the nation wants students. We want technicians; we want administrators; we want scientists; we want teachers; we want doctors. The students at the universities and colleges are not merely benefiting themselves: they are also acquiring skills and knowledge and aptitudes which will afterwards, when they practise them, be of benefit to the nation, and will help in increasing the production of the nation. We want to do all we can to encourage students in college, and to encourage parents to send their children to colleges and universities. I fear that these regulations may be an element of discouragement.

I would point out to hon. Members on this side of the House that it is not the case now, as it was 40 or 50 years ago, that the young men and women at our universities are the children of the comfortably off, wealthy classes. Entrance to universities now is very largely determined by intellectual merit. A very considerable proportion of the students at the universities today are the sons and daughters of the people of the working class. The working miner of today may have a son and a daughter at the university. If he is to pay their contributions during the university period so that they get the full benefits, he will have to pay 4s. 8d. a week for his son and 3s. 8d. for his daughter, in addition to his own weekly contribution. There would not be very much left out of a pound note each week on account of National Health contributions alone.

My right hon. Friend is a Welshman, and a very distinguished Welshman. He has by his life and achievements added lustre to the Principality. May I call his attention to the fact that probably in the whole of the Commonwealth there is no community that has a greater regard for education than Wales? There is nowhere where a working class parent will make greater sacrifices for his childrens' education than in Wales. All we are asking the Minister to do is to make some concession to students. We should like him to credit them for contributions during their college and university training. If he cannot do that, perhaps he can allow them to pay reduced contributions and still remain in benefit. The very least he can do is to adopt some method whereby, if they do not pay contributions, they can make retrospective payments and come into full benefit when their training has been completed. It would be very fitting and proper for a Welshman to make this concession to university students.

Sir Ian Fraser (Lonsdale)

On a point of Order. It would be very difficult, Mr. Speaker, to discuss the question of overlapping benefits which is the subject of another Motion on the Paper without discussing the credits and the option which perhaps might be said to be more properly related to these regulations. May I submit that they could be brought in Order on the discussion on the overlapping benefits regulations, which would prevent Members trying to catch your eye on this set of regulations as well?

Mr. Speaker

I confess that anything which would shorten the proceedings at this late hour would have my approval.

11.13 p.m.

Mr. George Thomas (Cardiff, Central)

My hon. Friends have made out a very substantial case tonight for the Minister to give further consideration to this question. The House should remember that since 1939, the number of students in the universities and colleges has increased by no less than 100 per cent. This Government has been very generous and sympathetic to students in general. Many students in colleges today are receiving grants of some sort or another and these grants rest very largely on a means test. They are very finely worked out, so that the student finds it very hard to meet his financial obligations. I have students in my constituency who tell me that, in view of the increase in cost of living since the war, they should now have a further increase in their grants.

The National Union of Students has passed a resolution, which has reached the Minister of Education, asking for a revision of grants because the students cannot meet their present obligations. If the Minister is adamant in his proposal that the recommendations of the Advisory Committee shall be carried out, undoubtedly a great hardship will be imposed on a section of our community which is not well able to bear the burden. Many students are receiving no grant whatever owing to the stringency exercised by their local education authority. I have received recently visits from parents who are worried beyond words when the recess comes round, because they cannot find the train fare to bring the students home from college. The Minister of Education, were he able to be with us, would know that this is so He is not unaware of it.

When parents have this financial strain and stress, it is unreasonable to tell them that on top of their present anxiety we are going to put on them the further burden of 4s. 8d. a week, or another £12 or thereabouts a year. The whole essence Of the National Insurance Scheme is to give security to our people, and this proposal is going to mean a tremendous anxiety to students who ought to be free to get on with the job of studying and not have their work injured by this awful anxiety.

There is a further anomaly to which I would draw the attention of the Minister and of the House. A boy in a secondary school receives credits for national insurance until he reaches 18. The average age of call-up to His Majesty's Forces today is 18 years and nine months and if a parent, being keen to give his son a further chance, says he will keep him on at the grammar school until the time of his call-up, he will have to pay the 4s. 8d. contribution for the boy, who is in the same class, with the same teacher, taking the same subjects as he was before he reached the age of 18. This is an anomaly which I am sure, now that my right hon. Friend is aware of it, he will be as anxious as we are to see removed. The Minister may try to remind us that there are other cases, other hardships, other difficulties which exist under this Act. I beg him not to seek to ask us to let this further hardship be imposed because other hardships have been created. There is no comfort and no solace for people who are suffering, to be told that others suffer as well.

The Minister will know that in the regulations that have been issued credits are given to some people over the age of 18. If a man has already been working and contributed to the National Insurance Scheme, and then undertakes a course of vocational training which satisfies the Minister, he will receive credits. Or if he goes to Ruskin College or Coleg Harlech, he can be credited. But if he is a student who has not yet started to earn his living, he is in an entirely different position. This is a very important matter to thousands of students in the Universities. I ask the Minister to bear in mind especially the case of the parent who has more than one child at the university.

There are a number of people in South Wales who are unable to speak for themselves and it is up to us to speak for them here on the Floor of this House. There are people in industry who are making tremendous sacrifices to give their children the chance of a university education. I know the sacrifice which had to be made for me to have my chance to go to the university, and I sympathise with those people who have more than one child in college. To tell them that they must pay 4s. 8d. for each child is to add the last straw to the burden. It may mean where another child is coming on, that the parents will say that they cannot afford to send that child to the university. My right hon. Friend, I earnestly hope, will give to the House tonight an assurance that these anomalies will be removed.

11.22 p.m.

Mr. R. A. Butler (Saffron Walden)

My hon. Friends on this side of the House are as interested as hon. Members opposite in the plight in which students find themselves under these regulations. I will first put part of the case of the Minister for him—not that the right hon. Gentleman is not capable of putting it himself, but I want him to realise that we understand the difficulties facing him. If we start making exceptions in a scheme which the Government have deliberately brought in on a certain date, the responsibility for that scheme being the Government's, it is extremely difficult to make exceptions for certain bodies of people. If we start doing that, the scheme, which is based entirely on the general unity of the population, will break down. I wanted to say that at the start, because I would not wish students to think that one was trying to make a speech simply to gain their favour, and to free them from the contributions and from the realisation that this scheme is one which depends upon universal contributions, without which it will break down.

I would, however, like the Minister to say why in these regulations, so far as I have been able to study them, there appear to be anomalies. Other hon. Members have drawn attention to some of those anomalies as between different types of young people, some of whom, devoting their early work to vocational pursuits, and later to adult educational courses, appear to be treated better than the ordinary student going in for the higher branches of education, whose case ought to be considered. I want to ask the Minister why these anomalies exist, and why those going in for further courses of training are not all treated the same.

My second point has also been touched upon; that is, that undoubtedly the students who quite rightly, as has been claimed, depend almost entirely on State grants and support for their living, are having an extremely difficult time. The difficulty is not over the fees that the students have to pay, but over the living expenses, once they reach the institutions to which they have to go. It is not only the living expenses, but those little extras which make the life of a student possible. It is really very difficult to go through student life, as some of us may remember from our own student days, simply on the basis of subsistence and fees; and some of these young men and women are having an extremely difficult time. Another consideration is that many of these young people are married. Many of us went through our student days in the blissful and happy condition of being single. No doubt we had a very enjoyable time and a great deal less responsibility than some of the young men who have been through the war and are married and have family responsibilities. In that respect, there is a great strain on the students as well as an extra financial burden.

The question arises in face of these two considerations how the Minister should alleviate the position. I think he should examine the point made by the hon. Member for Southampton (Mr. Morley) in a short but none the less effective speech; and that is to look into the possibility of retrospective contributions being paid by students to make up for the difficulties they have during the time when they are students, at either the training colleges or the universities. If that is actuarially possible, could we have an estimate from the Minister of what it would cost? Alternatively, there was the suggestion of bringing the students on to a par with those who go into vocational training. It is along those lines that some alleviation might be accorded to students.

I must end as I began by saying that the responsibility for this scheme is the Government's. They decided to bring it in on a certain day, and the House, including the hon. Members who support this proposal, voted for it. Thus all of us as Members of Parliament have to remember that we have to face the unpleasantnesses of this scheme just as we face the benefits. It is in that spirit that we should approach the genuine cases of these students, and help to find some alleviation for them. They have an extremely strong case for alleviation, provided the Minister can do it in fairness to other sections of the community and in fairness to the scheme as a whole.

11.27 p.m.

The Minister of National Insurance (Mr. James Griffiths)

We have had a very interesting Debate tonight, and it proves very clearly something of which I have been very conscious in the last three years, that there are many difficult problems which have to be faced when one decides—as the House and nation have decided—to establish a National Insurance scheme which is universal in its application. One of the most difficult problems is the problem of the students. May I begin by expressing the hope that none of us in this House or indeed outside it will think it is being called in question whether this Government or nation ought to encourage students. No Government before in this country has done more for students than has the Labour Government in the last three years. However, that is not the problem which I have to face at the moment.

The provisions to which reference have been made in this Debate have received a good deal of time and thought from myself, the Parliamentary Secretary and the officers in the Department. We also have a National Insurance Advisory Committee, the chairman and several members of which have an intimate knowledge of student life and all its problems. They also have given a good deal of time and thought to considering what is the best provision to make for the students. In the course of their consideration of this problem they have had contact with those representing the colleges, universities and education committees, and also with the organisation representing the students and with the National Union of Teachers. So there have been ample opportunities for all the organisations to make oral or written representations to the Advisory Committee. Eventually the Committee submitted a report to me which I have accepted. I want to tell the House briefly why we have accepted the Committee's report and then I want to make a suggestion which I believe will meet the difficulty.

There were three courses open to us in connection with the students. The first proposal was that made by my hon. Friend the Member for Aberavon (Mr. Cove), that we should credit them with contributions beyond the age of 18 as long as they were students. The second proposal was to classify the students under the Act as contributors, when they would fall to be classified as Class 3 contributors—that is as not gainfully employed—and subject to the ordinary rules of the Act as Class 3 contributors. The third alternative—the one the Advisory Committee recommended—was that the option should be given to the students while they were students to pay or not.

Let me say a word about the proposal put forward by my hon. Friend the Member for Aberavon. I want him to realise that we have given full consideration to the suggestion that students should be credited with contributions. To begin with, we have decided to credit students with contributions up to the age of 18, and, of course, there are a large number of students up to that age, much larger, in fact, than the number beyond that age. It will be appreciated that, in crediting them up to the age of 18, we are making a substantial concession to the vast mass of the students, most of whom have ceased their student life by 18. In doing this, it must be appreciated that the whole actuarial basis of the scheme is for contributions to be paid over the whole of the insurable life—for men from 16 to 65 years of age, and for women, to 60 years of age.

If we are to allow credits for contributions, then it should be realised that the burden must be carried by somebody else, and that the burden must be carried by the contributors. I put this quite frankly because it is the problem which we have to face. Is this House justified in providing credits out of insurance funds, and, as I am responsible for such insurance funds, am I justified in giving credits to the students if by such action I am going to put a burden on others? Quite frankly, many of the students will be able to bear the burden better than some upon whom it might be placed. That is the position and hon. Members have to realise that if we are to provide credits for persons, such credits must be considered when assessing the contributions.

I have come to the conclusion, therefore, that I should not be justified in giving credits beyond the age of 18. To do that would be to compel us to reconsider the actuarial basis of the scheme, and to increase the contributions. Let us be frank about this; is it fair to make young men and young women who go to work, pay increased contributions in order that others, many of whom are possibly in more favourable circumstances, may be granted credits? I have to be fair to the students, but in being fair to them, I have also to think of others and be fair to them also, and so I decided that I could not give credits beyond the age of 18.

The second alternative which we considered was to classify students as "not gainfully employed" and let them claim exemption under the terms of the Act, if their income was below £104 a year or £2 a week. But it is very difficult to assess a student's income, because the biggest factor is the amount of the grant, and to make such an assessment would be vexatious to them, as it would be vexatious to us; so therefore we rejected it. We came to the conclusion that we ought to give the students the option to pay or not to pay. I appreciate that some cannot pay, but at the same time there are many who can. Many fathers could afford to pay and if they can do so, let them do it. As the scheme now stands, students who do not pay contributions will have their benefits affected later on, because they will not be able to get the life average to entitle them to full benefit—widows' benefits and also other benefits as well may be affected.

I appreciate the point which has been put by my hon. Friend the Member for Southampton (Mr. Morley) and repeated by the right hon. Member for Saffron Walden (Mr. R. A. Butler) regarding retrospective payment. It is a solution of the problem to which I have given some thought myself and, if it meets with the approval of the House, I am quite prepared to consider it. But I should like to consider it with the Advisory Committee, giving the proposal my blessing, and I hope that I shall be able to say that it is also the desire of this House—that is, that we should consider whether the student who claims the option not to pay during his or her student life, shall have the opportunity, once settled in a career, to make restrospective payments. I am quite prepared to consider that with the Advisory Committee.

I hope that the House will agree to that, not only as a matter of courtesy but so as to seek the help of the Advisory Committee—putting this point to them and asking them to consider which way it can best be worked out. I will tell them it has my blessing and the blessing of the House. In that way a student might exercise his option not to pay, but I hope that many of them will pay. It is better than making a retrospectve payment later on; but if they cannot pay during their student career, then, when settled, they can make retrospective payments and we will seek a way in which they can do it without prejudicing themselves later in life.

Mr. R. A. Butler

We are grateful that the Minister is going to have this matter considered, but I should like to have this point clear: will it mean that the Government's view on this subject will depend upon the report of the Advisory Council or is the Minister giving a decision now? Do I understand that he will await their report himself and then return to the House and give us a decision?

Mr. Griffiths

I shall put it to the Advisory Committee with my blessing. I should like to discuss the matter with them. It is a matter of deciding not merely how it can be done, but how best it can be done. The committee contains members with much greater experience in this field than I have, and I think I should gain by having consultation with them. I am not making a definite decision, but I shall put it to the committee with my blessing and we shall consider it together. If we can arrive at a settlement, I feel it may meet the convenience of the House.

In the regulations we made, as between students and apprentices, students are defined as those who are engaged in study or training for a career—in secondary school or college. Trainees, on the other hand, are those whose education and initial training is over and who, after a substantial period of employment, come back into training under an approved scheme. We have accepted that, where they go to an approved scheme of that kind, we should give them credits, pro- vided that the scheme is one that the Minister approves. A number of such schemes have been approved. I do not want to read them out now but I can give hon. Members particulars. The particular one referred to tonight is the emergency training scheme for teachers. It is not yet finally decided whether or not this can be approved. It is one of the problems we are considering. I would ask my hon. friends to wait until we can give this further consideration and I will let them know what we have decided.

Mr. Cove

Is it possible for consultation to take place with the Advisory Committee and people outside who are interested in these problems? Will it require further regulations?

Mr. Griffiths

Under the regulations which we are discussing, if the scheme is approved I have power to credit contributions. I have already approved a number of schemes. The emergency scheme for the training of teachers is now under consideration, and if my hon. Friends and others have any representations to make on the matter, I shall certainly consider them. I make no commitment as to approval or otherwise of the scheme—the matter is under consideration.

My hon. Friend the Member for Central Cardiff (Mr. G. Thomas) referred to Coleg Harlech and Ruskin College. Unfortunately, they cannot go now to the Labour College to which I went. Let me put this one point. Students at colleges such as those are not in the same category as the majority of students. After years of life in industry, these people go as I did, to college, as in the case of those who go to Colleg Harlech or Ruskin College, and they are then "not gainfully employed." They will be expected to pay contributions as such, and these do not include contributions for health benefits; they pay Class 3 contributions, but in their case they will be credited as Class 1 contributions for sickness and unemployment benefit. Subject to the assurance I have given that we will reconsider this matter with the desire to do what is the fairest thing for the students, while bearing in mind that we have other classes of contributors to remember, I hope that my hon. Friend will agree to withdraw his Motion.

Motion, by leave, withdrawn.