HC Deb 05 February 1954 vol 523 cc794-804

Motion made, and Question proposed, "That this House do now adjourn."—[Sir Cedric Drewe.]

4.0 p.m.

Mrs. Eirene White (Flint, East)

The matter I wish to discuss this afternoon arises out of the reply which I received to a Question I put to the Minister of Education on21st January last. I asked the right hon. Lady whether her Department took any cognisance of contributions paid by students in full-time education over the age of 18 when their income or that of their parents was being assessed for the purposes of grant. The right hon. Lady replied that grants paid to students by her Department are not increased if the award holders voluntarily paid contributions during their period of study. Nor, of course, does she give any advice to local education authorities that they should take any account of these National Insurance contributions.

There are very many questions concerned with this subject on the National Insurance side on which I do not propose to touch this afternoon. If I did so I should be liable to stray out of order, because that might very well involve reference to legislation. But in any case, the problem of what type of contribution is really most suitable for students to pay and what type of benefit they stand most in need of is a highly complex one. I feel that it should be properly considered when the review of National Insurance takes place very shortly. I had an apology from the Parliamentary Secretary to the Ministry of National Insurance for not being able to attend this afternoon, but I have no doubt that his Department will be considering those other problems.

In order to urge the Minister of Education to alter the policy hitherto followed by her Department, it is necessary to indicate the present position. It is that anyone who is a full-time student over the age of 18 is not obliged to pay any Insurance contributions at all. He or she may voluntarily pay the Class III contributions, and the importance of those Class III contributions is that ultimate entitlement to retirement pension depends upon them, or, in certain circumstances, of course, the widow's pension and death grant. Those are the main benefits affected by Class III contributions. They do not cover sickness nor unemployment benefit. But, if the student elects not to pay these contributions during the period of his study, he has the opportunity of making up the arrears within the first four years after he finishes his studies.

One may say, if that is so, why should I concern myself unduly, because, if he is normally a provident person he will have the good sense to make up those contributions within the first four years after finishing his studies. But one must reckon with the optimism of youth and the fact that when one is aged 21 to 25, or thereabouts, one does not consider too closely what may happen to oneself, or one's wife, at the age of 65, or what may happen—which may be more unfortunate—to a possible widow or dependant children.

It seems to me a mistaken kindness on the part of those who framed the National Insurance provisions to allow students to opt out of paying these Class III contributions. I should make plain that they are not obliged to pay even during the four years after they have finished their studies. There is no absolute obligation to do so, but of course their right to benefit is affected if they fail to make up the arrears.

The disadvantages of not paying may extend even to those who, having failed to pay as students, decided to pay when they finished their period of study. At least the disadvantages may very well fall upon their dependants in certain circumstances. I should like to take one example. It may be said that it is an extreme case, but it is perfectly possible for it to happen. A young man leaves college at 21, enters employment and begins to pay Insurance contributions. He marries at 22, his wife has a child and then shortly afterwards, through some accident, he dies leaving a widow and a young baby.

Let us suppose for the sake of argument that before his death he had paid 104 contributions. That would be averaged over the period from the time when he reached the age of 18 years. His average might be as low as 20 or 21 contributions, which means that the widowed mother's allowance, paid to the widow with her young child, might be as low as 22s. instead of 43s. a week. That is to say, she incurs a loss of 21s. a week or about £55 a year for the whole period of the childhood of the son or daughter who is left behind.

One cannot pretend that the effects are quite so serious in the case of retirement pension. But the leaflet which is supplied by the Ministry of National Insurance for the use of students and trainees makes it perfectly clear that, with regard to the entitlement to retirement pension, even if the student paid 52 contributions a year from the time of entering employment after leaving the university, he would not be able to restore his yearly contribution average to 50 by the time he reached the age of 65. Other unforeseen circumstances might arise in the interim which, for other reasons, might impair his Insurance position.

It is for these reasons, therefore, that I feel that the Ministry of Education, which has a very real concern with the well-being of students, should look again at its policy in this matter and should recognise that it is quite possible for students to find themselves in difficulties or to place their dependants in difficulties because they have not covered themselves for insurance. As a matter of fact, I believe that in the illustration that I gave I made one error. The poor widow and baby in the circumstances which I outlined would not receive anything at all, because the man would not have made the necessary 156 contributions to qualify.

Although the number of cases involved may not be large, it is still our duty to avoid these personal tragedies and their consequences. I believe that it would be really very much more satisfactory if students were encouraged to pay these contributions, instead of being discouraged as they are at present. Last week I was at a meeting of students at Oxford, where one would suppose the undergraduates would be in at least as good a position to meet obligations of this kind as those in any university. I asked a number of them whether they paid contributions. Only one appeared to be paying voluntarily.

The others said that they just were not bothering, or that they really could not afford it. I cross-questioned more closely those who said that they could not afford it. They were in receipt of grants, which they said were such that they could only just meet their commitments, some of them by working in the vacation. In any case, they felt that they were not able to meet this additional expenditure. In fact, whether they could afford to meet it or not, they were not doing so. Some may go to professions where they have reasonable remuneration. Others may very well take work in which, during the first years when they have to make double payments, they are receiving lower salaries than they may get later on and they find it difficult to pay the arrears.

I am well aware that one of the hardships that students feel most acutely is their inability to insure themselves in any way for sickness benefit, but I do not wish to raise that point because it might involve us in discussing legislation. It is a major subject which has to be discussed by the Ministry of National Insurance and it is not a responsibility of the Parliamentary Secretary to the Ministry of Education, who will reply to the debate. The main principle is that Insurance contributions of the students are not excused altogether, that entitlement to benefit can be fundamentally affected by failure to pay in certain circumstances and that there may be no entitlement if they die in a period in which they are trying to qualify for benefit after they have left college. This makes an unanswerable case to put to the Ministry of Education, and I hope that the hon. Gentleman will agree that the matter should be considered again.

We have had experience since 1948 of the work of the National Insurance Act. and I am certain that the great majority of students who have considered the matter would agree with me that this is mistaken kindness, and that the emphasis should be upon the payment of contributions and not upon their excusal. I hope that the Ministry of Education will take a positive attitude in the matter and will put the welfare of the students first. I have no doubt that if they made it possible by adjusting grant allocations—providing that the local education committees did the same—the majority of students would be paying contributions. One might then reasonably argue with the Ministry of National Insurance that it should review the whole matter when they have their general review of the insurance provisions.

4.13 p.m

The Parliamentary Secretary to the Ministry of Education (Mr. Kenneth Pickthorn)

I am grateful to the hon. Lady the Member for Flint, East (Mrs. White) for the way in which she has put her case. I am sorry for the absence of the Parliamentary Secretary to the Ministry of National Insurance, but I think it is a normal convention that there should not be more than one Minister present on these occasions. Perhaps I ought to say, as he mentioned it, that he had a very long-standing engagement in the country that he could not have got out of.

I should like to begin by referring to one or two, or perhaps three or four, of the things which the hon. Lady said, and to develop later on a more formidable argument which I hope will refute them—but perhaps that is a matter for the Almighty to judge; I will at least refer later on to the whole of the case she has put.

I begin by agreeing that, as far as practical grievance and hardship go, what matters here is the case of the young widow. That would normally be, as I understand it, the case of a young man who took his degree when 22 years of age, and in the ensuing four years did not pay up his back premiums; at the age of 26 he got married, and at the age of 31 died, leaving a widow and a couple of children. That is the extreme case, and there is, of course, very serious financial loss.

I do not in the least wish to minimise the difficulties of such cases, but I think it fair to say that they are not very numerous. In such cases there must admittedly be some stage, either between the ages of 22 and 24, or after 24, when the salary paid, as the hon. Lady said, is a great deal smaller than that which a man will receive later. But it is also likely to be above the average of the general population, and I think that the number of cases where it would be unreasonable to think that such a young man could and should have made some provision for his dependants is not very great.

I do not want to ride off on that. Of course, if it can be shown that there is an injustice here, and an injustice which is the responsibility of the Department for which I am allowed to speak, then, of course, something else ought to be done. But I am not wholly convinced that it is a matter for such administration.

The hon. Lady, I think, spoke twice of the desirability that my right hon. Friend should change her policy in this matter. I am not quite sure that a change of policy would be enough. Again I do not ride off on that: I do not assert that more than a change in policy would be necessary. But I do not think it is certain that more than that would not be necessary.

If the hon. Lady will forgive me, I do not really think her argument that, after all, my right hon. Friend and I, more humbly, are concerned with the well-being of students, and that therefore anything to do with their well-being must be our responsibility, is watertight. Students still remain the responsibility of other Departments for other purposes.

I do not propose to begin—it is obviously not my business—by defending the Ministry of National Insurance or to go over the background described by the hon. Lady, which, for my purposes, is accurate enough. But she does not insist, as I should have done if I had been making prefatory observations, upon the principle behind National Insurance, the principle of universality and of contribution from the eventual beneficiary—the principle that there should always be some contribution from the eventual beneficiary, and that there should not be any beneficiary for whom all the contributions should be paid by the Government, whether or not the Government are the employers.

As the hon. Lady properly said, this is not our business this afternoon, but we must remind ourselves of it if we are to understand what is our business. The only exceptions to that main principle have been extremely small, and, apart from the school-child exception, are now little or nothing.

The arrangements for students, except in one particular which I do not think concerns the argument, are arrangements which were made in the time of the right hon. Member for Llanelly (Mr. J. Griffiths), when he was Socialist Minister of National Insurance, and largely upon the advice, in the particular which most interests the hon. Lady—advice which has been repeated now, I think, four times, and most recently within the last few months—of the National Advisory Committee of which the chairman is Sir Will Spens.

That Council consists of people familiar with the difficulties of students and who are likely to be prejudiced in their favour. I am bound to add about Sir Will Spens that no one is more familiar with the matter and more prejudiced in the way the hon. Lady would wish him to be. Yet they have not found it possible to advise that this principle should be departed from to the advantage of the student.

Mrs. White

I am not quite clear to which principle the hon. Gentleman is now referring, because there have been various suggestions that students should receive some amount of preferential treatment as far as contributions are concerned, and to receive benefits for which they have not paid contributions on the same level as other contributors. That was not my argument at all, and I wondered if it was to that argument, which has been put to the Minister of National Insurance, that the hon. Gentleman is now referring?

Mr. Pickthorn

I am referring to the principle that there should be contributions from the beneficiaries. The hon. Lady's first approach to the subject, in the case of students, was that they should be credited as though they had been contributors, and that should be done by the Minister of National Insurance. That plea would not wash—I do not mean that frivolously, but it would not do.

So now we come to the other suggestion. The hon. Lady rather foxed me this afternoon, because I had naturally thought that she was going to say that, if this sum of 5s. 7d. a week—getting on for £15 a year—was to be paid to students for this purpose, they were to use it for this purpose. But I did not gather that from her language this afternoon, and that makes still stronger one of the objections first suggested to me, on which I have done a good deal of cross-examination, but which I was at first unwilling to use. But, to the hon. Lady's present speech it is a very strong objection: that we could not be sure that the sum included would be used for the purpose intended, and I gather from her that it sometimes would not be.

Mrs. White indicated dissent.

Mr. Pickthorn

I am sorry, but if the hon. Lady will read HANSARD she will see. She thought the result would be that the majority of students would opt to pay, but did not think that they all would.

In another part of her speech she referred to the optimism of youth—inmy own experience it is a pessimistic period, but let that pass—she spoke of the optimism of youth—that boys of 20 did not insure against the eventualities to their potential widows. And it is a general objection on our part that we could not be sure that the money was going in that way, which is now confirmed by the words of the hon. Lady. I do not stand upon this argument, but there would be a good deal of expenditure on unnecessary administration.

The more completely what I will call objection No. 1 was removed, the more plainly would it appear that the Government is, by the agency of this Department, to pay to another Department—National Insurance—what that Department itself had refused to pay; sums which, if we consent to the hon. Lady's proposals, must come from the ordinary taxpayer, just as, in the case refused, when the Ministry of National Insurance would not have it, all such sums would have to come from the ordinary contributor. If we say, "We will give you 5s. 7d. a week, and set up administrative machinery to make sure you pay that in as a contribution to National Insurance" it would make it all the plainer that this would be the effect of the proposal: that Her Majesty's Government having been, on the advice of the Department principally concerned, unwilling to take the money out of the general contributor, thereupon another Department, concerned only with some indirectness, consented to do it by taking the money out of the general taxpayer.

I can hardly doubt that that is a genuine objection, which must be felt by everyone. Indeed, that was, no doubt, the view which was held by the right hon. Member for Llanelly when he did what I had supposed everyone approved of, but which the hon. Lady says almost everyone disapproved of—she thought it was mistaken kindness—to allow ex-students, within three, four or five years of their ceasing to become students, to pay such contributions as they might have neglected or have been unable to pay during their actual studentships.

I agree that each of my objections overlaps the other, but they are not mere repetition, and I hope that the difference between them is evident to the House: I should like to put my second point again in a rather more positive way. We are concerned with the well-being of the student, but what is the limit of our statutory concern and our capacity to spend, or interest other people in spending, public money? In this connection, our statutory business is to enable students to take advantage of educational facilities without hardship to themselves or to their parents, and it is difficult to argue that what is now being asked for is necessary to enable the students to study without hardship to themselves or their parents.

It might be argued that the student should be allowed to study without hardship to the eventual orphan, if he should marry young and die not long afterwards; I have cross-examined the intellectual and moral implications of this question as well as my abilities permit, but I think that it would be slightly absurd to say that this was really part of the duty of the Ministry of Education. Yet that is what the hon. Lady's case—which she put reasonably and moderately—amounts to.

It should be remembered that some parents could do the paying for the students. I do not rest my argument mainly upon that fact, although it is true that the right hon. Member for Llanelly put a good deal of weight on it when he spoke on this matter in July, 1948. He said "many fathers can afford to pay, and, if they can, let them do so." I do not put very much weight on that, although there is probably something in it. The fundamental point is that this question cannot be the concern of the Ministry of Education, even if it could do it with propriety and legality within the statutes and regulations, and I am not sure that it could.

It would be absurd to say that it is the duty of the Ministry of Education to give money to a student in the hope that he will use it as a contribution to the National Insurance system and thus avoid hardship for his young widow and orphan. I hope I am not going to be thought derisive or cynical, but that seems to be the case which is being put up. Apart from any legal and logical argument, we must also remember that anything which is going to give the student any privilege in the strict sense—any legal right which is not enjoyed by the generality—is done at the expense of the generality. In the hon. Lady's original submission it would be at the expense of the general body of contributors, and in her submission today it would be at the expense of the general body of taxpayers.

It is fair to go on from there and to say two things. Without in the least suggesting that all these students have either rich fathers or immensely remunerative careers, or both, a large proportion obviously become teachers, civil servants, and so on, and are very largely much better off than the average person in the Insurance Fund.

The Question having been proposed at Four o'Clock, and the Debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at Half-past Four o'Clock.