UNEMPLOYMENT INSURANCE (No. 2) RILL. (Hansard, 18 July 1922)

§ THE EARL OF CLARENDON

My Lords, this is a Bill to deal with the gaps in the uncovenanted or free benefits under the Act which was passed last April. It has been thought necessary to modify the terms of that Act on account of urgent representations which have been made by boards of guardians in the hard hit areas. Happily, however, the change which is proposed does not involve a demand for any increased contributions from any of the three parties contributing to this fund; that is to say, the employers, employed and the State; nor does it seek for increased borrowing powers on the part of the Minister.

I do not propose; this afternoon to weary your Lordships with figures dealing with the cost of unemployment in this country during the last, few years. It will be sufficient for my purpose, I think, if I call your Lordships' attention to the fact that, in January of this year, there were registered as totally unemployed approximately 1,900,000'persons, and 300,000 person's were registered as doing only part-time work. The situation has very materially improved to-day, for we have slightly under 1,400,000 persons registered as totally unemployed at this time, and slightly under 100,000 registered as doing only part-time work. For the purpose of the recent Insurance Act, some forecast had to be made as to the cost of unemployment up to the, end of July, 1923. The assumption was that it might, by the end of June this year, fall to about 1,500,000, and remain at that figure for the next twelve months, but, as I have already indicated, things are better at the present moment.

Now let me turn to the Act of last April. Your Lordships will recollect that, under that Act, the Minister was empowered to borrow a sum of £30,000,000. His borrowing powers were increased from £20,000,000 to that figure. Up to date he has, as a matter of fact, borrowed a sum of £15,000,000. It was found that, with the provisions contained in this Act, thirty-seven weeks' benefit could be granted from last April up to the end of June, 1923, but it was thought prudent, in view of the fact that unemployment is likely to be more severe during the winter months, 523 to reserve twenty-two weeks for this winter and the early spring, thus leaving fifteen weeks in the period of thirty between April and November of this year. It was thought expedient to divide those fifteen weeks into three periods of five weeks each, laying it down that, when five weeks' benefit had been drawn, no further benefit should be drawn until after an interval of five weeks.

From April of this year, therefore, to the end of October, the benefit under the Act of April of this year would have been paid in the following way: five weeks' benefit; five weeks' gap; five weeks' benefit; five weeks' gap; five weeks' benefit; and five weeks' gap. But since the first gap of five weeks was entered upon, the poor law authorities in certain areas represented that the effect of this gap was to throw large numbers of persons upon the local rates. Very naturally, this hit the areas where the rates are high very hard, and representations were made to the Prime Minister by a deputation which waited upon him, I believe I am correct in saying, on June 20, that the system of gaps should be abolished altogether.

The situation has been very carefully reviewed and examined. We are better off, as I have indicated, not only as regards unemployment, but as a consequence of that betterment in so far as the financial condition of the fund itself is concerned. In addition, steps have been taken to reserve the benefit for those who are most entitled to it, and the claims of boys, girls, young men and women have very materially eased the situation. It was anticipated that £19,000,000 would have been borrowed up to date, but, as a matter of fact, only £15,000,000 have been borrowed. In response, therefore, to the demand that has been made, it has been found possible to grant, from the period between April 6 and the end of October of this year, twenty-two weeks' benefit instead of fifteen weeks' benefit, as laid down in the Act of April last.

Those who have been continuously unemployed since April 6 have received, up to date, five weeks' benefit; they have entered upon and passed through the first gap of five weeks, and they are now in their second period of five weeks' benefit, which comes to an end on July 20; that is to say, Thursday of this week. The principle of the gap is to remain under this Bill, 524 but it has been decided to reduce the intervals between the periods of benefit from five weeks to one week. This means that, from July 20 of this year until the end of October, those who have received ten weeks' benefit, and who can prove that they have been continuously unemployed since April, and are still unemployed, will draw their benefit in the following way: one week's gap, five weeks' benefit; one week's gap; five weeks' benefit; one week's gap, and two weeks' benefit. This is the purpose of this short Bill, and, in view of the urgency of the demand, I should like to ask your Lordships to give it as expeditious a passage through your Lordships' House as possible. I beg to move.