§ Order of the Day for the Second Reading read.
§ THE EARL OF CLARENDONMy Lords, this Bill, of which I have the honour to move the Second Reading this afternoon, is part of what I might call a quadruple effort on the part of the Government to deal with the serious question of unemployment—an evil which is so prevalent in our midst to-day. I think it will be generally agreed that the one sterling remedy for unemployment is once more to get trade and industry moving upon an economic basis. That is the main objective of the Government in introducing what I have already described as their quadruple effort. The view is that in some degree we can attain that trade revival by putting into operation certain other schemes which will come before your Lordships' House during the course of the next two or three days. And while these proposals are being pressed forward relief works of a useful and productive character are being pressed forward with satisfactory results. When the Minister in another place moved the Second Reading of this very Bill he was able to announce—this, remember, was more than a week ago—that seventy-one 150 applications had been received from fifty-two different local bodies. Meanwhile, for those who cannot provide work there is the urgent necessity of bringing such succour as the grievously embarrassed condition of our national finances will allow. It is to that end that this feature of the Government effort is designed.
Your Lordships, will, I feel sure, be second to none in your desire to give every possible help in this great national emergency. Unemployment is a dark shadow which, alas! has brought much misery and distress to many homes in our midst. This Bill, I am sorry to say, cannot be a cure for that evil. The only cure is some revival, or rather a total revival, of trade and industry. But, at any rate, this Bill is designed to bring such assistance as is possible to those many homes into which misery and distress have been brought so recently. I am afraid that we have to face the coming winter with a prospect of at least 1,750,000 industrial workers out of employment. It is hoped that some trade revival may take place as the result of the other efforts which His Majesty's Government are at present about to make, but it would not be safe, I think, to assume that on the average there will be less than 1,500,000 workers unemployed during the coming winter.
Here our plans afford assistance to Boards of Guardians whose resources must already be severely strained. Then we have the Unemployed Insurance Acts of 1920 and 1921, and I should like to remind your Lordships that the new period of benefits begins on November 3; that is, to-day. Trade Union help is very nearly exhausted, but what is far worse is that the household resources and savings of the workers have been requisitioned to provide daily maintenance. Therefore, the Government feel that it is incumbent upon them to try and do something more along the lines of the Insurance Acts for men who are out of work, for their wives and their children. It is not much that we can do, but we can do something. The state of the national Exchequer settles that point.
I should like to refer as briefly as I can to the main points in the Government proposals. We are going to ask the employer and the employed who is insured under the Insurance Acts to make further contributions towards a fund the proceeds of which, augmented by a substantial 151 grant from the Government, will go to the women and children. This Bill will continue to operate for a period of six months, and during that period the contributions that will be paid are as follows:— The men— that is to say the men who are insured against unemployment and in work— will pay 2d. a week; the employer in respect of each man insured and in work will pay 2d. a week; and the State will make a grant of 3d. a week. In regard to the women, boys and girls, they will make contributions of ld. a week; the employer will make contributions in respect of each woman, boy or girl, employed by him, of ld. a week, and the State will make a contribution of 2d. a week.
This will give us altogether, per week, by way of income, something like £204,000, or about £6,250,000 in rather over six months; that is to say, unless unemployment grows worse in the meanwhile. The total contributions from both employer and employed will give rather more than half that sum of £6,250,000 and the contributions of the State rather less than half. Both the employer and the employed know full well that their contributions will go towards helping to give valuable assistance to their unfortunate comrade who is down and out for the time being. Through the Unemployment Insurance Acts both the employer and the employed have come to their unfortunate fellow man's assistance in a splendid manner, and the response which they have made to those Acts leads the Minister and the Government to believe that this further appeal can be successfully made to their spirit of comradeship and sympathy.
One or two alternative plans of operating this measure have been considered, but the Minister has decided, after very careful thought, to administer this Act by means of the same machinery which operates the Unemployment Insurance Acts. The clerk who pays out the 15s. and the 12s. benefit, as the case may be, under the Unemployment Insurance Acts will also pay out this 5s. in respect of the wife of the unemployed worker, and the is. for each child dependent upon him. That will be done only upon proper evidence of eligibility, and will continue so long as the unemployed worker is drawing unemployment insurance benefit. The estimate made by the Government actuary as to the numbers of women and children who will benefit under this measure represents very substantial figures. He 152 calculates that about 750;000 women will benefit, and very nearly 1,400,000 children. I think you will agree, therefore, that it really is worth doing.
Before I proceed any further I want to point out one thing, in order to prevent any misunderstanding. That point deals with the time when these new benefits will begin to operate. As I have already told your Lordships the new insurance benefits begin as from to-day. The first contributions under this Bill commence as from November 7 and the first week's grant will run as from November 10. That is the scheme, very shortly.
There are, however, one or two other points which perhaps I ought to mention. Clause 6 provides, firstly, that grants from this fund shall be taken into account in determining whether outdoor relief is granted. Secondly, Section 27 of the Unemployment Insurance Act, 1920, is temporarily suspended during the operation of this Bill. Let me explain exactly what that means. In granting relief all unemployment benefits must be taken into account plus any help from this fund. But under the Unemployment Insurance Act, 1920, benefit is only taken into account in so far as it exceeds the 10s.; therefore, the emergency payments under this Bill plus the full amount of unemployment benefit— that is to say, not cutting out the 10s.— must be taken into account in determining what amount of relief is paid. The proviso in Clause 1 subsection (1) makes it quite clear that no grant can be made to the wife of an unemployed workman who is herself receiving unemployment benefit or is in wage-earning employment.
One or two features in the financial arrangements ought also, I think, to be mentioned. This measure, as I have already indicated, runs normally until May 7, 1922. On the basis of 1,500,000 unemployed during that period the contributions received by that date will not quite balance the expenditure. Therefore, power is taken in the Bill to extend those contributions for a further period in order to meet a possible deficit. There is also an opposite provision which lays it down that if there is a balance remaining to its credit after the fund has met all its liabilities, that balance shall be paid into the Unemployment Insurance Fund. When this Bill was read a second time in the House of Commons Ireland was not included in it, but since that date it has 153 been included in the Bill and is so included at the present moment, on the distinct understanding that it remains unless, before this Bill passes into law, power to operate the measure when it becomes an Act has been handed over to the Legislatures in Ireland.
I do not know that I need say very much more, but there are two matters to which I should like to refer before I resume my seat, As your Lordships are aware, this is a measure which will inflict a pretty heavy burden of responsibility and a certain amount of extra work upon those bodies known as local employment committees. Your Lordships no doubt know that those committees have been at work for some time, carrying out their duties most satisfactorily, arduously and earnestly. They are composed of representatives of employers and employed with a certain number of co-opted members and, I am happy to say, representatives of ex-Service men. Under this Bill the Minister will be obliged, from time to time, to refer matters of great importance to these bodies; they will have to help him to operate the Bill, when it becomes an Act, in the most careful and assiduous manner. But I cannot let this opportunity pass without publicly stating how valuable their assistance and their work have been in the past, and I think I can truthfully make the same remarks about the staffs of the local Employment Exchanges.
I have only one more point to raise and I approach it with a certain amount of diffidence. It is to ask your Lordships to expedite the passage of this Bill through the House as much as possible. I have no desire whatever to check criticism on the Bill, or to ask your Lordships not to amend it if you see fit to do so; that is very far from my mind. I approach the matter from two standpoints. One is the humanitarian point of view, and the other is what I might describe as the practical point of view. If the passage of this Bill is delayed beyond Tuesday of next week at the very utmost, I am informed that there is going to be great difficulty in securing the first contributions of the workpeople themselves, because in a good many cases pay-day takes place on Wednesday and, as your Lordships are aware, these twopences will be deducted from wages in the same manner as the Unemployment Insurance contribution is deducted. The net result of that would simply be that the benefits which accrue 154 under this Bill to wives and children would be slightly delayed.
The other reason is that there are certain Government Amendments which will be laid before your Lordships in Committee and which necessitate the return of the Bill to the House of Commons before it can become law. I am given to understand that the House of Commons will conclude its sitting to-morrow somewhere about five o'clock. As your Lordships do not meet until a quarter past four there will not be very much time to get the Bill through its final stages in order that the House of Commons may decide as to whether they agree to the Amendments or not. The House of Commons, therefore, will not be able to deal with the Bill until Monday next. The point I would ask your Lordships to consider carefully is that we should so expedite the passage of this Bill through this House that we can deal with it to-morrow and get a Royal Commission to give the Royal Assent by Tuesday next.
§ Moved, That the Bill be now read 2a.— (The Earl of Clarendon.)
§ LORD BUCKMASTERMy Lords, I am sure that you must all have felt that the expressions of sympathy to which the noble Earl gave utterance were sincere. I think also that you feel, with myself, some sense of gratitude to the noble Earl for the extremely clear way in which he explained the provisions of a not too simple Bill. In rising to make some criticism upon the measure, I desire to do so only for the purpose of asking your Lordships once more to consider not merely the palliatives, of which this Bill is one, for the disastrous condition into which our industry has fallen, but to see if there be not some root mischief that lies at the bottom of this trade depression— mischief which, unless it be relieved, will render it a permanent burden upon our national life.
Unemployment is no new phenomenon. Before the war industry was always subject to periodic, and sometimes to prolonged, crises in which many men were thrown out of work. The winter frequently took away from men their chance of earning their living, and, even apart from these seasonal conditions which affected their occupation, there were cycles which it was difficult to measure, and extremely difficult to fore 155 tell, which recurred again and again in trade, and produced depression with disastrous consequences. It was often said that the real cause of this difficulty was incessant over-production, and there is no doubt that the workmen got deeply rooted into their mind the idea that by increasing and assisting in the increase of the output of the mills they were simply building up the causes which would lead, sooner or later, to their being thrown out of work. There never was, of course, a more disastrous fallacy. Whatever trouble caused those periods of distress it was not overproduction.
It may well have been that it was due to the fact that the commodities that were made were not properly distributed, and that there had been too rigid and too immovable a line fixed for the expenses of maintaining industries and the profits which the employer received. Had that been more elastic; had the men been able to associate the increased production with increased receipts, and by that means been able to expand their own means of payment, it might well have been that those difficulties could have been avoided. I refer to that now only because the idea which, through some quarter of a century and probably longer of industrial strife, has been firmly embedded in the minds of workmen has just been the fact that the more they laboured to increase the output— it may be that the more they increased their master's profits— the more certainly they produced the period when their work would be no longer wanted, and they would be thrown out of employment. That idea has remained.
The war is said to have destroyed many things, but it has left that fallacy behind, and I regret greatly to say that to my mind it has been enormously increased and inflamed by the course that the Government themselves have taken during the last three years. It must have been plain to the most shortsighted observer that the war would produce catastrophes in our industrial system which it would not be easy to remedy. Trade never was, and never could be, confined to buying and selling at home. Our trade, beyond all others, was a trade which depended for its life upon our power to export goods overseas, while again, overseas trade did not depend upon selling simply goods to one country and getting their products back. It was a most delicate, intertwined, complicated 156 vascular system by which commerce slowly spread through every single territory and State in the united civilised world, with the result that goods that you sold to America might be paid for by goods that you got from Germany, or from China, or from South America, or anywhere else. Into that delicate and complicated system the war cut a deep gash, and I regret to say that the Government., instead of taking steps to heal the wound, appear to me, from their results, to have taken steps to deepen it and make it permanent.
It is no use producing palliatives of this description for a condition of things which is inherent in the policy that has been pursued during the last two years. Unless, and until, trade can be revived in Europe, our trade will languish. We shall be unable to produce the goods for export, and we shall be unable to keep our people employed at home. Unemployment spreads like an infectious disease from trade to trade, and from industry to industry, and the first thing the Government ought to have done, instead of merely concentrating their energies on how to relieve something which they regard as transient, was to concentrate them on how to prevent the possibility of this transient distress becoming a permanent phenomenon in our national life. I regret to say that they seem to me to have done very little indeed in that direction.
It may well be said that the complaint I have made against the lack of zeal on the part of men to put the greatest amount of their energy and power into their productive labour is one for which the Government is not responsible. I cannot accept that view. There are two things that the Government did when the war was over, for which I think they can never be sufficiently and adequately blamed. The first thing was that they led everybody to believe that our troubles were going to be relieved by the mere fact that we had won the war, and that we were going to get our debts paid by contributions from Germany. They refused to listen to the utter economic impossibility of getting anything of the kind accomplished without effecting the ruin of our own domestic trade. They insisted that £25,000,000,000 was the sum that Germany could produce, and they would not listen to anybody who suggested that such a sum was fantastic and impossible. They also led the people here to think that they were going to have the 157 most wonderful homes built for them; that the conditions of their industry and their labour were going to be lightened; and that life was going to be a better and a happier and a surer thing for all of us.
Precisely the opposite was the truth. Life had got to be a harder and meaner thing than it was before, and if this country ever meant to gather the full results of the victory that had been won for us by the sacrifice of so much suffering and life in France, it was vital that everybody should concentrate their energies on seeing how, by thrift and hard work, they could restore the position which the war had almost overthrown. There was no such word, there was no such suggestion, in any of the Government proposals.
Further, they did something which I regard as equally bad. They attempted to let people think that by the mere process of raising payment you could establish once more equilibrium; that if prices of commodities were high all you had to do was to increase the payments to everybody so that their means of demand might be multiplied, and by those means their position would be exactly what it was before. The amount of money which they spent in bonuses is really beyond belief, and although among the poorer people some such relief was undoubtedly required, yet the essence of their scheme, which was to try to put everybody back in the position in which they were before the war broke out, showed to my mind that they had failed to grasp the fundamental facts of the position, which were that our life never could get back to the position which existed before 1914 until very many long years of struggle and endurance had passed away.
The result of it all is upon us in the unemployment that we have to face. The Government do admit that the result of this must be that very heavy burdens must be imposed upon this country, and for the first time they appear to realise that the burdens which we already carry are sufficiently heavy. I notice that the Chancellor of the Exchequer, a day or two ago, spoke in another place in terms of gravity of the amount of taxation that we have to bear. But this has been pointed out to the Government again and again during the last three years, and they have made no attempt whatever, until quite recently, to cut down the expenses and embark upon a policy that would enable that taxation to grow more light.
158 This Bill, as I understand it, is only one of a series of measures that are coming up to us, every one of which, if I apprehend their intent rightly, will involve, or may involve, some considerable addition to the public expense. Twenty-five millions is mentioned as the figure in one Bill; what the estimate is under this Bill, whether it is six or eight or twelve millions, I do not know. What I want to ask is, how is the money going to he provided; what is the source from which it is coming? If it is going to be raised out of Income Tax it will mean another 6d. or 7d. or 8d. in the £on that tax. If it is going to be raised by capital, is it intended to raise a loan, or is the proposal to raise it by the simple process of turning the handle of the printing press? This House has no longer any power whatever over Bills that affect questions of this description, but. I apprehend we none the less have cast upon us the duty of expressing our views upon measures of this nature, and criticising the conditions which have resulted in this trouble.
I can only see that the Government have adopted one course to escape from their difficulties. They do not seem to have considered any of the central causes that lie at the root of this problem. Their only remedy is that we should wade deeper and deeper into the ocean of debt. We have waded fax enough already, and many of us are gasping for breath. It will only require a few steps further, and the retreat, which may even at this moment be impossible, will then be for ever cut off. I raise no opposition to the terms of this measure, but I think that it is desirable in passing it that your Lordships should keep before your mind the central problem, of which this is nothing but a small piece of evidence, and that is my excuse for having troubled you with my comments upon this Bill.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.