HL Deb 28 July 1924 vol 58 cc1036-71

Order of the Day for the House to be put into Committee read.

Moved, That the House do now resolve itself into Committee.—(Lord Parmoor.)


My Lords, before the House goes into Committee, I should like to be allowed to make a few observations. Noble Lords who were present when the Second Reading was taken will, no doubt, remember that some of us entered a protest against this Bill being brought up at a time when the Bill which it is to replace would expire within a few days, and we expressed the view that the Government might have brought it up in time to allow us an opportunity of considering it. We further pointed out that the Second Reading of this Bill, which is the most important Bill, which the Government have brought forward during the present Session, was put down after another Motion which the House had to consider at some length.

The result was that, while my noble and learned friend Lord Cave had an opportunity of making some criticisms of the Bill which were, as usual, brief and lucid, some of us who would have liked an opportunity of dealing with the Bill on the Second Beading were unable to do so. It was, if he will allow me to say so, largely owing to the excessive loquacity of the Lord President that there was no opportunity for any other speakers to take part in the debate. When I say "excessive," I do not think that I am using an exaggerated term, because the Lord President, on the question of the League of Nations and the Second Reading of the Unemployed Insurance Bill, occupied no less than one hour and three quarters of a sitting of four hours. I consider that excessive, and I think it was rather hard on other members who had desired to take part in the proceedings.

I do not propose to detain your Lordships with anything like a Second Beading speech, because I am very anxious, as noble Lords will recognise, not to waste the time of the House, but there is one point upon which I should like to have a little information from the Lord President. It is not a point which I can raise in Committee, because it deals with the whole finance of the Bill. The Lord President pointed out the other day on the Second Reading that what is called the solvency period would, in ordinary circumstances, come into force in June, 1926, and, when it comes into force, the contributions from employers and men are to be reduced from 10d. and 9d. respectively to 6d. each, while the contributions of the Government will be increased. The Actuary who examined the matter on behalf of the Government has reported that, taking into consideration all the changes which so far have been incorporated in the Bill, with one exception to which I will refer in a moment, there will be at the end of that period a revenue of £30,600,000 and an expenditure of £30,500,000, giving a surplus of about £100,000.

The Lord President then surprised the House—and I think he admitted that he had been surprised himself—by calling attention to an Amendment which had been made at a very late stage of the Bill in the other House which would throw a charge of no less than £4,500,000 a year upon the Unemployment Fund. The original Bill, for which I was responsible, and the subsequent Bill, provided that no one could obtain benefit until seven days of his unemployment had elapsed. This period of a week is going to be reduced to three days, at a cost of something like £4,500,000 a year, as I think the Lord President stated. The question I want to put to him—and the information will be of advantage to the House—is, how is that going to affect the solvency of the Fund, how long is it likely to defer the day on which the Fund will become solvent and the reduction of contributions by employer and employed take effect? I think everybody has felt that while those contributions have been accepted and paid without complaint by the employers and the men, they are a very heavy burden upon industry, and that the sooner they can be reduced and the Government contributions increased the better it will be for trade, for the men and for the employers. Unfortunately, this charge will throw a very great additional burden on the Fund and considerably delay the period at which the Fund again becomes solvent. Personally I would rather have had the extra contributions and give these three days. I raise this point now because it would not be possible to raise it in Committee, and I shall be glad if the Lord President of the Council will tell us what will be the actual effect of this additional charge upon the Fund, how much it is likely to delay the solvency date, which at the present moment is June, 1926, and how His Majesty's Government propose to meet the additional charge.


I am very willing to give the noble Earl what information I can. I am afraid I curtailed my remarks so closely the other night, in order to save time, that I may not have made the point as clear as I ought to have done. Really the position is quite clear. The difficulty to which the noble Earl has referred cannot arise until the deficiency period is over. Until that period is over the larger contributions will go on, and it is certain that the deficiency period will not be over until after July, 1926, which is the time at which this Bill conies to an end, and unfortunately, as has been the case before, no doubt, these financial matters will have to be reconsidered. The estimated surplus while the present payments are made is about £5,000,000. No doubt the £4,500,000 will affect that to a very large extent, but there can be no question whatever of insolvency. What the noble Earl has in mind is what may be the result when the deficiency period is over, and the new contributions come into force. The answer is that it is extraordinarily difficult to foresee what will happen with regard to questions of employment and unemployment. It depends upon the basic figure. It is wholly impossible for the deficiency period to come to an end during the life of the present Bill, and matters will then have to be reconsidered.

On Question, Motion agreed to.

House in Committee accordingly:

[The EARL OF DONOUGHMORE in the Chair.]

Clause 1:

Rights of insured persons to unemployment benefit.

(3) If an applicant for benefit in whose case the requirements of subsection (1) of this section are fulfilled is not entitled thereto under the provisions of the last preceding subsection, by reason either that the number of contributions paid in respect of him within the period therein mentioned is less than twenty, or that sufficient contributions are not standing to his credit or that he has already received benefit for periods amounting in the aggregate to twenty-six weeks in the benefit year in which the application is made, he shall nevertheless be entitled to receive benefit if in addition to satisfying the requirements aforesaid he also proves—

LORD BANBURY OF SOUTHAM, on behalf of Viscount Cave, moved, in subsection (3) after "in which the application is made, to leave out" he shall nevertheless be entitled to receive benefit "and to insert" the Minister may in his discretion authorise the payment of benefit to the applicant." The noble Lord said: As Lord Cave is not here I propose to move the Amendment which stands in his name. The subsection as it stands does this. It says:— If an applicant for benefit in whose case the requirements of subsection (1) of this section are fulfilled is not entitled thereto under the provisions of the last preceding subsection, by reason cither that the number of contributions paid in respect of him within the period therein mentioned is less than twenty, or that sufficient contributions are not standing to his credit Or that he has already received benefit for periods amounting in the aggregate to twenty-six weeks in the benefit year in which the application is made, he shall nevertheless be entitled to receive benefit if in addition to satisfying the requirements aforesaid he also proves— Lord Cave wishes to leave out the part which entitles a man, subject to the requirements later mentioned, as of right to receive the benefits. I think it is very necessary that these words proposed shall be put in, because your Lordships will see that if they are not put in this result will occur: that a man who has not paid sufficient contributions to receive benefits, or who has already received 26 weeks benefit, notwithstanding that and notwithstanding the fact therefore that he is not entitled to receive any benefits, nevertheless is to receive the benefits to which he is not entitled. This is quite a new provision, although I believe a short time ago it was provided that the Minister might, if he desired, allow a man to receive the benefit, although he was not entitled to it. Personally I do not think that the solvency of the Fund is going to be maintained if we allow this sort of clause entitling a man as of right to receive benefits to which he has not contributed and to which he is not entitled. If we have any regard to the solvency of the Fund we must, at any rate, say that a man is not to receive of right this benefit which is really a payment ex gratia, but may receive it if the Minister thinks that it is necessary he should so receive it.

I cannot conceive, when one looks at the financial position of the Fund, that such a very dangerous provision as this ought to be left in the Bill. The noble and learned Lord, Lord Parmoor, a moment ago, stated that he would give a very clear explanation of the question put to him. I listened very attentively to his statement, and so far as I can understand the clear explanation it is this—that the noble and learned Lord did not in the least know whether the Fund was going to be solvent or not, and we should not find out until July, 1926, when the financial arrangements would have to he reconsidered. That, as I understood it, was the clear explanation given, and I believe that, as a matter of fact, nobody living knows whether or not the Fund will be solvent in July, 1926. I shall have a few-words to say upon that on my own later Amendment, but I might point out to your Lordships that when the departure was made, I think by Dr. Macnamara, four or five years ago, which, allowed people to receive, benefits to which they had not contributed, I stated that the result would be that the Fund would be insolvent, and that unemployment would continue. Dr. Macnamara told me I was wrong, and that the whole thing would right itself before long. Certainly five years have elapsed since then, and the only result is that we go on repeating the mistake which we made at that time.

Amendment moved— Page 2, lines 13 and 14, leave out ("he shall nevertheless he entitled to receive benefit") and insert ("the Minister may in his discretion authorise the payment of benefit to the applicant").—(Lord Banbury of Southam.)


My Lords, let me say a few words on the financial side. I do not think that the financial effect would be different either way, but, as a matter of fact, the Government Actuary's Report was made on the basis of there being a right to the payment, and its not being left to the discretion of the Minister. The discretion of the Minister has been exercised substantially in favour of the claimant by all Ministers of all Governments, but I want to say why it is considered better to make it a, matter of right and not of discretion. Clause 1 deals both with covenanted and un-covenanted payments, and your Lordships will see that, as regards un-covenanted payments, the provisions are contained in paragraphs (a), (b), (c) and (d) of subsection (3). The statutory conditions there set out must, be complied with before any payment is made, and those statutory conditions appear to me to go far in the direction indicated by the noble Lord opposite. The applicant must be normally insured in an insurable employment; he has to prove that in normal times insurable employment suited to his capacities would be likely to be available, and that he has, during two years immediately before the date, been so employed; and, lastly, he has to make every reasonable effort to obtain employment suited to his capacities, and to be willing to accept such employment. I think it is right that the claimant for benefit, if he complies with those conditions, should receive the benefit as a right, and not as a matter of discretion.

The noble and learned Viscount, Lord Cave, in speaking on this matter on the Second Heading said he thought that it would be inconsistent with the contributory principle to allow this payment as a right, instead of its being at the discretion of the Minister. I want to suggest, that it is just the other way. Personally—and the Government have given expression to the same view—I am wholly in favour of contributions. I think that the contributory principle ought to be protected and encouraged to the utmost, and, because of that, I hope your Lordships will not accept this Amendment. How does the matter stand? So far as contributions are concerned, they are compulsory for everyone employed in an insurable employment. There is no option of any kind. If you have compulsory contributions on one side you ought to have the right to obtain benefit on the other, subject to any statutory Regulations which it is thought right to lay down. Surely, that is a principle. Why should not a person who is subject to the liability of compulsion for contributions be entitled as a right to receive the benefit, if the statutory conditions are complied with? I feel very strongly upon this point, because, if you take away the claim as of right you are getting back towards the position in which the money is provided by the State and not by contributions. The reason why a man is entitled is that he has been under liability to contribute.

The history of this matter has not been consistent, although when it was discussed in another place I think this Amendment was withdrawn or negatived, and, I suggest, quite rightly. When this uncovenanted benefit was first introduced, or, at any rate, in the Act of 1921, Section 3, it was not discretionary, but was of right. Since that time there have been amendments both ways, it is true, but surely it is right, and in accordance with the contributory principle, that when a man is under obligation to contribute he ought, as of right, to be entitled to benefit when the time comes.


As regards the first point raised by Lord Banbury I think the answer of the Lord President is really a complete one. Parliament in the last few years has been going step by step in this direction. I think the original Act of 1911 fixed a limit of fifteen weeks, and later that was increased, first, to twenty-six weeks, then to forty-four weeks, and now to fifty-two weeks. So that practically the principle of the thing has been very largely accepted already by various Parties, and in various Bills. I do not think it is a definite new departure from the point of view that the benefit should be more or less proportionate to the contributions that have been paid, or are about to be paid. It weakens, though it does not entirely destroy, that principle. The Lord President has drawn attention to the conditions which have to be complied with if a man is to receive benefit, the most important of which is that the claimant is making every reasonable effort to obtain employment suited to his capacity. Of course, the decision on that is left to the local committee, which represents employers and workmen, and it has to be satisfied that he has made his best endeavours to obtain employment.

There is a further matter which I think escaped the attention of the Lord President and which, to a certain extent, justifies what he says. This is really based on the contributory system. It does not apply to new entrants; it only applies to men who have already been in an insured trade, in insurance for two years or more, and who have already paid at least thirty contributions. That is to say, these men have already been under the purview of the Act, and have paid for a certain amount of benefit. In addition to that, as soon as they are able to obtain employment again they at once resume the payment of contributions to the Fund. Therefore, they are contributors, though not contributors to the full extent to which the original Bill and the Amending Bill intended. The fact is that this system of unemployment benefit has been applied to far more trades and industries than was originally the case when it was an experimental proposal. It covered originally two and a half millions of people, whereas it now covers, I think, twelve millions and still leaves one or two trades outside. Therefore, in considering this matter, we have to look a little more than we had before, perhaps, to the interdependence of different trades and the risks in them, and it seems to me that contributions ought to bear some relation to risk and to the collective amount obtained for the Fund, as a whole, to cover so many industries.

My noble friend says that this is a new principle applied to the question of unemployment. I will endeavour to show that, although it is a new departure to some extent, it does not destroy the principle of contributions, and that there is a great deal of force in the Lord President's remark that it emphasises and enforces that principle. I confess that I was somewhat nervous when this Bill was first introduced owing to a phrase which fell from the Minister of Labour in another place regarding the question of a contributory basis. I was rather afraid that it looked as though the Government were going to depart in some way from the contributory basis, and I was very much relieved to find that they retained that basis to as full an extent as it had existed up to now; that is to say, that the men, on the one hand, the employers on the other, and the State in the third place contribute to the Fund. If this benefit came to an end, as was the case in the early days of the Unemployment Act, when a man had so much benefit and no more, it would mean that it would come to an end after a considerable period of unemployment when a great deprivation had been suffered by the man and his family. If, after that long period, he was thrown out of benefit it would mean either that be and his family would suffer very severely or that would happen which happens now—they would apply to the Poor Law, and the guardians would be brought into a matter from which I think all Parties desire to keep them. I think that would be a very serious matter indeed.

The main argument used in the other House was, I think, that this provision would induce a man to remain out of work and to prefer to draw unemployment pay, and that a great many men were what is called "work shy." I think the answer is that even with the increased benefits which will be paid under the new Act the amounts, as the Lord President pointed out the other day, are very small. I do not think in any case they come to anything approaching what the man would obtain in his trade if he went to work. Therefore, the inducement for him to remain on the Unemployment Fund instead of going to work is very slight indeed. Then he has to go before the local committee periodically to show that he has made his very best endeavours to obtain work but has been unable to do so. Therefore, I do not think the question of "work shyness" would come very much into the matter.

This is a more doubtful proposal, however, than that in the former Act. It is. to a certain extent, a new departure, but I do not think it is such a departure from principle as would prevent the Act working properly. I think it would be a very great advantage to these men to obtain this benefit. So far as this point is concerned, the Fund is in a solvent condition and actuarially is able to meet the demand. I hope, therefore, that your Lordship's House will agree with the decision come to in another place and will reject this Amendment.


The Lord President in his answer to me, said that he thought it was absolutely right that where a man had contributed to receive certain benefits he should receive them. I agree with him; but he has apparently overlooked the words in this clause which say that, "if an applicant for benefit is not entitled thereto." His explanation falls to the ground. In all these insurance Schemes, if a man contributes he is entitled to receive the sum to which he is entitled under the scheme; but he ought not to receive something to which he is not entitled under the scheme and for which he, therefore, has not paid. Under this provision a man is going to receive something to which he is not entitled under the scheme and to which he has not contributed.

The Lord President also said that it is not necessary to put into the clause the words "if the Minister approves," first, because all Ministers would approve, and, secondly, because of paragraphs (a), (b), (c) and (d) of subsection (3). There can be no harm in putting those words in, from the Lord President's point of view, if he thinks that all Ministers would approve. But it does not at all follow, I think, that all Ministers would approve. In regard to the abuse of this provision, I do not agree with the noble Earl, Lord Buxton, that people might not refuse to accept work because the benefits are less than they would get if they worked. It is very easy to say that the work offered is not suitable or that something prevents them from taking it. Everybody knows that there are at present a considerable number of people who prefer to be unemployed rather than work. Therefore, the arguments adduced by the Lord President are in favour of the Amendment and not against it.


I must express my regret that I was riot here in time to move the Amendment which stands in my name, but I was engaged elsewhere upon another public duty and did not anticipate that this Bill would come on so soon. I have gathered from the debate something of what was said by the noble and learned Lord, the Lord President, in answer to the Amendment, and I want to make a few points upon it. First, I am sure the House understands that this Amendment is confined to uncovenanted benefit: that is, to benefit which is payable where it would not have been payable as the result of contributions. In such a case hitherto the Minister has had some discretion. He has had the right to make these payments of uncovenanted benefits, but he has not been compelled to pay them. Therefore, he has been able to give instructions to committees dealing with these cases to enable those committees to prevent abuses and in some measure to prevent unjustifiable calls upon the Fund.

In this Bill, for the first time it is sought to take away that discretion and to give to the man who has not paid sufficient contributions to entitle him to benefit a right to have benefit. In other words, for the first time you are giving a statutory right to what has sometimes been called "work or maintenance." That is that if a man cannot work he shall be entitled by law to these allowances out of the Unemployment Fund. I venture to think that this House ought, at the very beginning, to make a stand against such a proposal. It is the very negation of the whole principle of insurance for unemployment. Hither- to, although there have been a good many relaxations; all Governments and all Parliaments have maintained the principle that benefit in the ease of unemployment must rest upon insurance. This Bill throws away that principle. It destroys the whole rule upon which the present Act rests and it makes that which, for the first time, one is inclined to call a "dole," a matter of right and not of contract. That is, it creates a right dependent upon the gift of other people, and not dependent upon the man's own contributions to the Fund. I hope we shall stop that from the very beginning.

It may be that the Amendment would, in practice, for some, time to come, and while the emergency continues, make no practical difference to the man—that is to say, that a Minister might quite possibly think that in all these cases he should exercise his discretion in favour of the applicant for benefit. But even if that be so you preserve the principle, you enable the Minister, if he thinks fit, to make Regulations limiting this particular kind of gift. This is, of course, put forward not in the interest of the State in the main, although this costs the State something. What I chiefly want is to relieve the other workers and the employers from having to pay this "dole" to men who are not themselves contributing to the Fund. I believe that the maintenance of the premium at its present high rate for a prolonged period is really a great hardship upon the men who are at work, and also a very heavy burden upon industry as a whole, and I want, and I am sure noble Lords opposite want, as soon as they can, to get matters back to the normal. That is really what I am working for, and I do not think I have pressed it unreasonably.

I do not at all mean to object to the increase of the amount of benefit. As I said the other day, I should not like to take the responsibility, in view of what we have been told by His Majesty's Government, of objecting to the increase of the weekly amount of benefit to be paid, nor am I seeking to prevent the Minister from sanctioning the payment of uncovenanted benefit during this period of emergency. Subject to those things, I want, if I can, to keep firmly to the principle that this is a gift. It is really a gift from the other workers, and ought not to be made a matter of right simply because a man asks for it. I feel greatly indebted to my noble friend behind me for moving this Amendment in my absence, and I hope your Lordships will insert it in the Bill.


Perhaps I might say one word in answer to what the noble and learned Viscount has said. He is under the disadvantage—or perhaps it is an advantage—of not having heard the case that I had made. I think it is quite clear that as to the contribution principle it is not so much a matter between one contributor and another, as it is one between the Fund provided in great part by contributions under compulsory conditions on the one side, and giving all workers a right to the benefit when the occasion arises, on the other. I pointed out that in my view—and I agree with what the noble and learned Viscount said upon the Second Reading—it is important that under the statutory limitations introduced into this Bill the claim should be one of right and not merely a discretionary claim. I also suggested that we should know that as a rule the discretion has been adopted. As the noble Earl pointed out, you want to make unemployment insurance a safeguard against the old Poor Law principle. You really can only do it in this way. I do not want to go over the argument that I have already used, but it certainly appears to me that you want to keep the contributory principle and to make it effective, and you ought to make it sufficiently wide. That being so this Amendment ought not to be adopted, but the Bill should be left in its present form.


I should not have said anything upon this matter, as your Lordships may suppose, but for the explanation which has been given by the noble Lord, the Lord President, as to" why we should vote against this Amendment. I should have thought that the Amendment did more to preserve the contributory principle than anything else. But the noble and learned Lord opposite said that we ought to vote against it because the Bill as it stands does everything possible to preserve the contributory principle which is so important. The way in which it preserves the contributory principle is this, that it allows people to benefit by the contributions of others to a Fund to which they themselves have not contributed. The noble Lord, the President of the Council, was, I think, a Chancellor of one diocese, or perhaps of several. That being so, I have not the slightest doubt that he has made himself acquainted with the writings of Pascal in his "Provincial Letters." This doctrine of the noble and learned Lord reminds me more than anything I have ever heard of Pascal's explanation where he deals with the casuists. I do not for a moment impute

Resolved in the negative, and Amendment agreed to accordingly.

Clause 1, as amended, agreed to.

Clauses 2 and 3 agreed to.

Clause 4;

Amendments as to disqualifications for receipt of unemployment benefit.

4.—(1) Subsection (1) of Section eight of the principal Act (which imposes a disqualification for the receipt of benefit during a stoppage of work) shall not apply in any case in which the insured contributor proves that he is not participating in or financing or directly interested in the trade dispute which caused the stoppage of work, and that he does not belong to a grade or class of workers members of which are participating in or financing or directly

to the noble Lord that ho is a casuist, but his argument reminds mc of the attitude of Pascal where he deals with the doctrine of "La grace suffisante qui ne suffit pas." Here we are to preserve the contributory principle by allowing those to benefit who have not contributed to the Fund.

On Question, Whether the words proposed to be left out shall stand part of the clause?

Their Lordships divided: Contents, 19; Not-Contents, 47.

Haldane, V. (L. Chancellor.) Grey of Fallodon, V. Rathcreedan, L.
Riddell, L.
Parmoor, L. (L. President.) Soutkwark, L. Bp. Shandon, L.
Southwark, L
Beauchamp, E. Arnold, L. [Teller.] Stanmore, L.
Buxton, E. Gainford, L. Strachie, L.
Meston, L. Terrington, L.
Allendale, V. Muir Mackenzie, L. [Teller.] Thomson, L.
Curzon of Kedleston, M. Falkland, V. Kenyon, L.
Salisbury, M. Hood, V. Knaresborough, L.
Hutchinson, V. (E. Donoughmore.) Lawrence, L.
Balfour, E. Lawrence of Kingsgate, L.
Bradfoud, E. Long, V. Marshall of Chipstead, L.
Coventry, E. Peel, V. Merthyr, L.
Doncaster, E. (D. Buccleuch und Queensberry.) Ullswater, V. Montagu of Beaulieu, L.
Newton, L.
Iveagh, E. Armstrong, L. Plumer, L.
Lovelace, E. Askwith, L. Ponsoby, L. (E. Bessborough.)
Lucan, E. Banbury of Southam, L. [Teller.]
Malmesbury, E. [Teller.] Raglan, L.
Midlteton, E. Clanwilliam, L. (E. Clanwilliam.) Redesdale, L.
Onslow, E. Saltoun, L.
Clinton, L. Sydenham, L.
Bertie of Thame, V. Crawshaw, L. Templemore, L.
Cave, V. Darling, L. Teynhan, L.
Chaplin, V. Jessel, L. Wharton, L.
Wigan, L. (E. Crawford.)

interested in the dispute, or that the stoppage is due to an employer acting in a manner so as to contravene the terms or provisions of any agreement existing between a group of employers where the stoppage takes place, or of a national agreement to either of which the employers and employees are contracting parties.

(2) Subsection (3) of Section eight of the principal Act (which disqualifies an insured contributor for the receipt of benefit while he is an inmate of any workhouse or other institution supported wholly or partly out of public funds) shall not apply in the case of an insured contributor who is an inmate of an institution used as a place of residence for workers if lie proves that he was an inmate of the institution immediately before he became unemployed and that during the time when he was employed he paid the whole or a substantial part of the cost of his maintenance as such inmate.

LORD BANBURY OF SOUTHAM moved to leave out subsection (1). The noble Lord said: There are three arguments against this subsection. The first objection is the financial effect of the provision. The Government have issued a White Paper on the subject of this Bill, giving the further Report of the Government Actuary on the financial provisions of the Bill. First of all the Actuary says that the charges which have been imposed under the Bill while it was in another place will leave a deficiency of £4,500,000 and that this result docs not take into account any liability arising under proposals which he discusses later in the White Paper. Paragraph (8) of this Report is the one which deals with this subsection, and the Actuary says this: Clause 4 (1) provides for the payment of benefit in certain cases of unemployment arising in connection with trade disputes. … I much regret that after further examination of the subject I am compelled to adhere to the conclusion that the cost of the clause is, as I have stated,' insusceptible of calculation.' Therefore, knowing that there will be a deficiency of four and a half millions more than was contemplated when the Bill was introduced, we are actually going to put in this clause, which the Actuary says is "insusceptible of calculation." That is the financial objection.

The second objection is that it is, in my opinion, an encouragement of strikes. It says that where a man is not a member of the trade union in which a strike is going on he shall, because he loses his work on account of the strike, nevertheless be entitled to receive unemployment benefit. There is a provision that his trade union must not be concerned with the other trade union, but that is a matter which can very easily be got over. Conceive an instance which I think is very likely to take place. An employer employs certain men who are members of trade union A, and certain men who are members of trade union B. Trade union A strike, and the result of that is that the employer is unable to employ men of trade union B. Consequently trade union B men, under this clause, will receive unemployment benefit. It is said that if the two trade unions are in collusion the men do not receive benefit, but how are you going to prove that they are, or are not, in collusion? Is it not perfectly easy for the secretary of one trade union to say to the secretary of another trade union—it need not be in writing at all—"If you strike our men will have to go out, they will get unemployment benefit, and the employer's work will be at a standstill"?

Your Lordships must remember that the employer contributes out of his own pocket to the payment of benefit to the men who are on strike. The men who are on strike stand out, and the employer is compelled to come to term" with them. Then the secretary of trade union B says to the secretary of trade union A: "Now we are coming out. Your men will not be hurt, because you will get unemployment benefit and, when the strike is over, you will have the increased wages which you won by your strike." They go out, the employer's work is again stopped and the employer has to contribute to the benefit of the other set of trade union members who are out. I venture to say, therefore, that this clause is calculated to promote, strikes, and is entirely in the interest of the trade unions in preventing their funds from being encroached upon if strikes take place.

The third point is this. The subsection says that the disqualification for the receipt of benefit shall not apply if the stoppage is duo to an employer acting in a manner so as to contravene the terms or provisions of any agreement existing between a group of employers where the stoppage takes place, or of a national agreement to either of which the employers and employees are contracting parties. How on earth are you to tell whether or not the employers and employees are contracting parties to a national agreement? Some may say that they are, and some may say that they are not. I have been concerned in a good many strikes on the railways. I think, in almost every case it was said that the agreement had not been carried out either by one side or the other, and a dispute immediately arose as to the meaning of certain words in the agreement arrived at. But here "you introduce a clause which it would require the subtlest legal brain to elucidate, and, when you have that subtle legal brain—say that of my noble friend, Viscount Cave—in all probability one of the two parties would not abide by his interpretation. I say, therefore, that this subsection is bad in principle and bad in drafting, and deserves to be eliminated from the Bill. I beg to move.

Amendment moved— Page 5, lines 12 to 26, leave out subsection (1).—(Lord Banbury of Southam.)


I think I ought first to point out to the noble Lord that the two principal matters with which he has dealt do not really arise on the proposal to leave out the whole of this subsection. They really arise at a later stage, when, no doubt, the matter will have to be fully discussed and considered. The noble Lord's first objection really conies under the Amendment to be moved by the noble and learned Viscount, Lord Cave, which stands next upon the Paper, and the second point is raised by the Amendment which stands in the name of the noble Lord, Lord Askwith. As regards the other parts of the noble Lord's observations, I think he is the only member, either here or in the other place, who has not recognised that the existing provisions of the law under this head work hardly. I thought that this was common ground in another place, and was not-likely to be controverted here.

Under the law as it stands, a claimant to insurance benefit may be disentitled although he has no responsibility for, and no connection of any kind with, the strike in question. Surely that is unfair. I think the noble Lord goes much too far when he talks about encouragement of strikes. This Amendment has nothing to do with that subject. The only point is whether a claimant who is not in any way responsible, either directly or indirectly, for a strike is to be deprived of the benefit to which he would otherwise have been entitled. I should have thought that the noble Lord would be the first to recognise the unfairness of that position. As regards the other matters raised by the noble Lord, I must leave them until the specific Amendments come before us, but I hope that the noble Lord will not press this Amendment, which, I think, no other member has regarded as an Amendment which should be brought forward.


With regard to one of the points raised by my noble friend, the observations of the Actuary did not apply to this clause, but to a clause, of the original Bill of a far wider description, the effect of which it is almost impossible to estimate actuarially.


Did not the second Report refer to this clause? I thought that he adhered to his view, that he could not make a calculation.


I do not think that he put it so strongly, but it is more easy in this particular case to estimate the numbers. The other provision, as I think noble Lords who have studied it will understand, brought in a very large number of those to whom my noble friend referred, whereas this one will bring in only a very limited, number. Its wording is directly limited, and consequently it cannot have the effect which my noble friend seemed to fear. I wish to make only one or two observations in regard to this matter, which has always been a. very difficult one. When I had the honour of drafting, introducing and passing the Act of 1911 I had for my assistants Sir John Simon and Sir H. Llewellyn Smith, both most acute and fertile minds, and this was far the most difficult problem with which we had to deal at that time.

The clause introduced in the original Bill divided industries up into different factories, and if there was a strike in a particular factory it was laid down definitely that nobody working in that factory should be entitled to unemployment benefit. That clause stood the test for some years, but, as the Lord President has pointed out, it did lead to-serious hardship. A test case occurred some years ago when a number of moulders struck for increased wages, or better conditions, or whatever was the object. They had a union of their own, but under them, and working side by side with them and dependent upon their work, was a large number of labourers. These labourers had no interest whatever in the moulders' strike. They did not support it or assist it, nor could they benefit by it, whether the moulders won or not. Yet, because they happened, to be in the same factory in which the strike took place, these labourers were debarred from the unemployment benefit for which they had contributed and which, in any other factory, they would have been entitled to receive. This is only one instance of a hardship of which a certain number of other examples could be given.

The Government, in their original Bill, had a clause which, in my opinion, and, I think, the opinion of those who have considered this matter, went a great deal too far, because it was undoubtedly open to manipulation—I need not trouble your Lordships with the wording of it—both on the one side by the employers and on the other side by the men themselves. Under this clause it was possible to bring out, for instance, just a few of those whom we may call the "key" men, whose cessation of work would bring all work in a particular factory to an end, and the other men, not having given notice, would be entitled therefore to receive benefit from the Fund. That might be the effect of the clause proposed by the Government. There was no provision that men directly interested in the success of the strike—sort of sleeping partners in the strike—should be debarred from obtaining benefit at the expense of the employers. I think the Government realised, after further consideration, that that went too far, and in the other House Sir John Simon, who has always given the matter the utmost consideration, with a desire to make the thing just, proposed this clause which is now in the Bill. The upshot of this clause, I think anybody who reads it must see, is that no working man can obtain benefit who is in any way directly or indirectly interested in the strike itself.


How can you prove it?


I will come to that. The people whose hardships we want to remove are the people who have no interest, one way or another, in the strike, and who yet are thrown out of employment in consequence of it. The applicant has got to prove that he is not interested. The onus of proof is on him of showing that he is not participating. I am assuming that there is a strike, and that the applicant comes to the local committee, on which are representatives of employers and men. He has to prove that he is not participating in, and is not financing or directly interested in the trade dispute. "Directly interested" means that he will benefit if the strike is brought to a successful conclusion. It seems to me that the clause really covers the hardship, which is undoubtedly great, and I think it affords a sufficient safeguard and guarantee that the unemployment benefit shall not go to cases in which the man is in any sense directly or indirectly benefiting from the strike. I will not deal with Lord Cave's later Amendment, relating to federations of trade unions, but taking the clause as a whole, in my view—which may not be worth much, but I have studied the question for some time—it will relieve the hardship and also give additional safeguards. The latter part of the clause is, I think, badly worded, but I believe that there is an Amendment on the Paper which may improve it. Taking it as a whole, I think that the clause, dealing as it does with questions of difficulty, does meet them.


I feel some hesitation about this Amendment, because I think there is a great deal of foundation for what my noble friend behind me has said It is true that the Government Actuary has twice expressed his total inability to calculate the cost which will be thrown upon the Fund by this clause. I suppose it is also true that it may happen that two unions, although not associated with one another, might be working together and one playing into the hands of the other. But it is also the fact, I think, that the present rule causes hardship to people in no way responsible for a strike. It has happened, and no doubt may happen again, that a certain class of workers in a factory strikes and throws out of work other workers in no way connected with them either in the class of work, or grade, or in their union. It does seem, rather hard that the latter should lose not only their pay but also all chance of support from the Unemployment Insurance Fund. We have to balance one thing against the other, and I rather hope that my noble friend Lord Banbury will not press this Amendment, but will allow this subsection to be dealt with upon the two points raised by later Amendments. After what Lord Buxton has said, I am sure I shall have his support for my Amendment, and I think in that he will only be following the lead of his colleagues in another place. I think Lord Askwith will have his support, too. I do not, however, want to discuss those two later Amendments now. My own conclusion is that it would be better not to press this Amendment now.


Lord Buxton, in a moment of great modesty, said his opinion was not worth very much. I bog to differ from him. I think his opinion was very valuable when he brought in the original clause which, according to his own showing, disentitled all men who were on strike, in a factory, whether from their own fault or through the action of the "key" men, from receiving benefit. Now he has run away from that, because of certain hard cases. In this world there always will be hard cases, and if you legislate for hard cases may you not inflict greater hardship upon other people? Of course, the words which Lord Buxton says make this clause safe are legal words, and I presume, they mean what plain English says. But how on earth is anybody to know what are the facts? A man or the secretary of his trade union, may come forward and declare that the applicant is not interested, directly or indirectly, in the particular strike, and is not going to gain anything from it.

That may be true—and even if it is not true it would be very difficult to prove that it is not true—and yet there may be a conspiracy by word of mouth between the secretary of one union and the secretary of the union of the "key" men, by which one set of men should strike first and the other set should strike afterwards, and by so doing so weaken the employers that they would be bound to accede to the men's request. if this provision were not in the Bill the result would probably be that the large number of men thrown out of work by a strike of the "key" men would go to the "key" men, who had not perhaps a genuine grievance and say to them, "You must go back to work." If this subsection is in the Bill, however, there is no incentive to these workmen to urge the "key" men to return to work, because they will receive unemployment benefit. Therefore, I say that this subsection, even as proposed to be amended by the Amendment of my noble friend, would encourage strikes. The Amendment of my noble friend, Lord Cave, is this: After "belong" ["belong to a grade or class of workers"] to insert "to a trade union which either by itself or through another trade, union or a, federation or association of trade unions is, or." I venture to say that the case which I instanced just now is not protected by these words, and, indeed, I do not see how it can be safeguarded against except by leaving out the subsection altogether. I should very much prefer that the subsection should be left out altogether. I do not want to put your Lordships to the trouble of a Division, but if I have any support I shall certainly go to a Division.

On Question, Amendment negatived.

VISCOUNT CAVE moved, in subsection (1), after "belong," to insert "to a trade union which either by itself or through another trade union or a federation or association of trade unions is, or." The noble and learned Viscount said: This Amendment does, I think, deal with the very point that my noble friend has just been discussing, and with the point put by the noble Earl, Lord Buxton. The position is this. There may well be engaged in one factory members, of one union, some doing a particular kind of work, others doing another kind of work. The first lot of men may be what have been called "key" men: that is, they may be men whose employment is necessary to keep the factory going. If they are withdrawn the factory may have to stop. What happens as the subsection stands? The union withdraws the "key" men alone, and, of course, his to maintain them while they are on strike. The result is that the other men go out by necessity because they cannot work while the "key" men are away, and they are to be maintained by the Fund. You therefore throw upon the Insurance Fund, which is not meant for that purpose, the main part of the financial support of the strike. I hold that to be absolutely unfair, and I cannot conceive how anybody can support it.

The effect of my Amendment is that in order to receive benefit the applicant must show, among other things, that he does not belong "to a trade union which either by itself or through another trade union or a federation or association of trade unions" is participating in, or financing, or directly interested in the dispute. I believe that is a reasonable proposal. May I add that I think the noble Earl, Lord Buxton, was mistaken? He seemed to think that the words in the Bill are those which were proposed by Sir John Simon. On the contrary, the words proposed by Sir John Simon were those which I am moving to-day, and which were strongly supported by that distinguished member of the House of Commons. They were definitely accepted by the Minister of Labour, and I think that the Leader of the House, when appealed to, himself accepted them, too. What happened I do not know, but on the following day, when the time came to move this Amendment, no Liberal member was ready to move it, and the Amendment had to be moved by a member of another party. It was opposed both by the Liberal party and the Labour party, and was defeated. So, if my noble friend is going to be guided by the opinion of Sir John Simon, to which he very rightly attached the greatest importance, I shall find him among the supporters of this Amendment

Amendment moved— Page 5, line 18, after ("belong") insert ("to a trade union which either by itself or through another trade union or a federation or association of trade unions is, or ").—(Viscount Cave.)


My Lords, the Amendment is substantially the same as that moved in another place by Sir John Simon. Sir John Simon had not quite the same words. He merely added "and trade union" after the description of the various grades and classes which would be disqualified. That Amendment was very strongly resisted by a great many trade unionists, for the reason that, for the first time, it established a sort of invidious distinction in dealing with workers, between trade unionists and nor unionists. It aroused so much feeling among the trade union representatives that the Minister of Labour approached Sir John Simon with a view to getting him to withdraw the three, words "and trade union." If the noble and learned Viscount will forgive my saying so, his Amendment goes a little further than Sir John Simon's Amendment. After discussion, Sir John Simon withdrew. The subsection as it stands really covers nearly every point raised by the noble and learned Viscount, except, one. It disqualifies a workman, if either he himself or any members of the grade or class to which he belongs are participating in, or financing, or are directly interested in the dispute. That covers nearly everything, except the case of a high grade man running the powder machinery, who might be said to be in a different grade from the workmen who are thrown out of work through the fact that he is on strike.

The matter was gone into very deeply in another place, a good deal behind the scenes. I took a great interest in it from the start, and I am persuaded that what decided Sir John Simon and others to withdraw the words "and trade union" was that, for the first time, when a man presented himself at a Labour Exchange now an inquiry would be made whether or not he was a member of a particular trade union, and the attempt would be made to distinguish between unionists and non-unionists. Everybody who has studied these matters will, I am sure, agree that the trade union movement is an absolutely indispensable thing, and to introduce that element of bitterness into it would be highly dangerous. It is for that reason that the Government sincerely hope that this Amendment will not be pressed. In point of fact, it does not tighten up the Bill except in one very small respect, and it is likely to cause a great deal of ill-feeling among trade unionists.


The noble Viscount, Lord Cave, referred to this Amendment as having been in the original proposal made by Sir John Simon. The noble Lord opposite has pointed out that the wording is different, and that this Amendment really goes further.


I agree, it does go further by including a federation.


I am not authorised to speak on anybody's behalf, but I noticed what happened in the other House. Sir John Simon proposed a verbal Amendment across the Table on a very difficult question. This seemed to meet with the general approval of the House and of the Government, and they accepted it. But, admittedly, they had not had an opportunity of seeing it on paper, and they reserved their right to consider such a question of detail. There is, therefore, no question of a breach of faith. It is simply a question of merits. I understand that these words, or some similar words, were in the original proposal of Sir John Simon, but, after further consideration, he withdrew them on hearing the Minister of Labour's objections.

What we want undoubtedly, I think, is a, definite safeguard that there shall be no abuse of this subsection. The noble Viscount, Lord Cave, seemed to think that this clause is in the same position as the original clause of the Bill, and that you would have "key" men going on strike and that the other workmen who would be effected would receive benefit, though, as a matter of fact, they were interested in the strike. I think that was the main reason why those particular words were put into the subsection, which state that the applicant for benefit has to show that he is not participating in a strike. It may be said that he is not participating in a strike, though the "key" men are, but I think, practically, it would be found that he was. He has also to prove that he is not financing, and is not directly interested in, the dispute. All those who belong to the particular union, or grade, or class as the "key" men, are all equally interested in the effect of the dispute and, therefore, there is no question under this subsection of a few men being taken out and the others being left in. On the face of it, that seems to me, as a layman, to be clear.

Then there is the point which was put by my noble friend Lord Thomson, that until now the committees, containing representatives of the workmen and the employers (and, finally, the umpire in case of dispute), have had to decide conditions which any one can decide, which are clear conditions, and can be decided without any question of going back on what a man's record has been in other respects. They argue that he is an insurable man,

that he has worked in an insured trade, and that he has been endeavouring to obtain work. Those questions are not controversial and, in any case, are all pure questions of fact. If you introduce the very controversial question as to whether a man is or is not a trade unionist, it may cause a good deal of prejudice on the one side or the other. I think it would be a very great pity—and I agree with my noble, friend Lord Thomson in this—if such a question as that, a totally different class of question to that which comes before them now, had to come before these committees to be decided. It would also raise questions between the unionist and the non-unionist, and a man would be, or might be, prejudiced in that way. I think, on that ground alone, that it would "be a very great pity if these words were included in the subsection. If a man's: union is financing the strike he is financing it.


Therefore, in order to find out whether he was financing it you would have to ask the man to what trade union he belonged.


Not on his applying for benefit.


The hardship would undoubtedly be that men who do not in I any way, either direct or indirect, take part in the strike may be refused benefit.

On Question, Whether the proposed words shall be there inserted?—

Their Lordships divided: Contents, 54; Not-Contents, 16.

Curzon of Kedleston, M. Hutchinson, V. (E. Donoughmore.) Jessel, L.
Salisbury, M. Kenyon, L.
Inchcape, V. Knaresborough, L.
Balfour, E. Long, V. Kylsant, L.
Bradford, E. [Teller.] Novar, V. Lawrence, L.
Chesterfield, E. Ullswater, V. Merthyr, L.
Doncaster, E. (D. Buccleuch and Queensberry.) Montagu of Beaulieu, L.
Southwark, L. Bp. O'Hagan, L.
Iveagh, E. Plumer, L.
Lovelace, E. Armstrong, L. Ponsonby, L. (E. Bessborough.)
Lucan, E. Ashfield, L.
Malmesbury, E. Askwith, L. Raglan, L.
Morton, E. Balfour of Burleigh, L. [Teller.] Rathcreedan, L.
Onslow, E. Redesdale, L.
Banbury of Southam, L. Saltoun, L.
Allendale, V. Clanwilliam, L. (E. Clanwilliam.) Strachie, L.
Bertie of Thame, V. Sydenham, L.
Cave, V. Clinton, L. Templemore, L.
Chaplin, V. Crawshaw, L. Waring, L.
Falkland, V. Daryngton, L. Wharton, L.
Hood, V. Harris, L. Wigan, L. (E. Crawford.)
Haldane, V. (L. Chancellor.) Grey of Fallodon, V. Riddell, L.
Shandon, L.
Parmoor, L. (L. President.) Arnold, L. Stanmore, L.
Gainford, L. Swaythling, L.
Beauchamp, E. Hemphill, L. Terrington, L.
Buxton, E. Muir Mackenzie, L. [Teller.] Thomson, L.
De La Warr, E. [Teller.]

On Question, Amendment agreed to.

[The votes of Earl Beauchamp and Viscount Grey of Fallodon who had voted by mistake with the Content although they intended to vote with the Not-Contents, have been recorded accordingly with the Not-Contents.]

Resolved in the affirmative, and Amendment agreed to accordingly.

LORD ASKWITH moved to omit all words in subsection (1) after "directly interested in the dispute." The noble Lord said: The Amendment in my name on the Paper is to leave out the last part of the subsection. The words are: or that the stoppage is due to an employer acting in a manner so as to contravene the terms or provisions of any agreement existing between a group of employers where the stoppage takes place, or of a national agreement to either of which the employers and employees are contracting parties. On the Second Reading of this Bill I criticised those words as being unworkable and impossible. The Government seem to have been of the same opinion, because an Amendment is on the Paper to-day totally different from the words which appear in the Bill and meaning something quite different from what is in the Bill. I do not think, therefore, that it is of any use my wasting the time of the House in attacking the words of the Bill, which the Minister of Labour spoke of in another place as being words about which he had never been consulted, and of which he had never heard until they were read out.

The Government are proposing a new Amendment, and it seems to me that the most practicable thing to do is to consider whether the Lord President's Amendment to substitute new words for the last part of the subsection ought to be accepted. I would like to criticise the Lord President's Amendment. I have four strong objections to it. In the first place, it is an alternative to what goes before, and, so far as I read it, it would be possible for a person to belong to a grade or class of workers who are participating in or are financing or interested in the dispute and yet to get unemployment benefit, by being able to say that the employer was committing some breach of a national or district agreement. My second point is that the Amendment of the noble and learned Lord is too wide. It might possibly be improved in the first part of it if the words "at the factory, workshop or other premises" came in again after the words "having committed." Even then the last lines do not lay it down that a man must come forward and accuse the employer of having committed a breach of an agreement against himself, but could say the employer had committed this breach against someone else, it may be Tom, Dick or Harry who was one of the same class of workers to which the assured contributor belonged. It has been argued that it was undesirable that the Employment Exchanges should investigate whether a man belongs to a trade union or not, but it is still more serious for those Exchanges to have to investigate a question of whether there has been a breach of an agreement or not, either national or district.

This question of a breach of agreement is one of the most difficult things in industrial disputes that it is possible to imagine. It was investigated in 1912 by a body called the Industrial Council, which sat for thirty full days hearing evidence, and whose Blue-book amounted to 655 pages. They investigated this question of breaches of agreement. They found what a variety of difference of view there was about it, and how extremely difficult it was to find whether there had been a breach of agreement or not. Among their recommendations they made one or two suggestions as to what should happen when there was an alleged breach of agreement, but that was not after a strike or lockout, but before a strike or lockout. They said that a breach of agreement ought not to be settled by a strike or lockout, but that for every alleged breach of agreement there should be an investigation.

One of their recommendations, in paragraph 16 of their Report, was this: We are of opinion that where there is (a) a difference in regard to interpretation of an agreement, or (b) a difference as to whether there has been a breach of an agreement there should be no stoppage of work (by strike or lockout) pending the reference of the difference to some impartial tribunal and pending the issue of a pronouncement by the tribunal. In paragraph 35 they stated: In many associations rules for the punishment of persons committing a breach already exist, and we recommend that other associations should follow the lead which has thus been taken and consider whether it is not advisable that similar rules should be adopted in their organisations. Those recommendations were made by that important body, consisting of heads of the great employing associations, and also heads of the chief trades unions, and they were signed by, among others, Mr. J. R. Clynes, Mr. Harry Gosling, Mr. Arthur Henderson and another Labour leader, Mr. John Hodge. They considered it important, that questions of breach of agreement should be carefully investigated. They found that it was one of the most difficult things in the labour world to determine, and it seems extraordinary that the question as to whether there is a breach of an agreement or not should be handed over to an official of an Employment Exchange to decide, with a possibility of its going to a referee or umpire after the strike or lockout has begun.

When dealing with the proposed Treaty of Mutual Assistance the Lord President found enormous difficulty in dealing with the question of breaches of international agreements. He said that the effectiveness of the scheme seemed to depend to a considerable extent on the ability of the Council of the League to determine by unanimous vote of all members not concerned in the dispute which nation was the aggressor. It is a difficult question to be settled internationally, and I say that the difficulty of deciding who is the aggressor as regards district and national agreements in the industrial world is equally great. The suggestion by a man that his employer has broken an agreement would bring the employer under this subsection, and that seems to mc to be almost ridiculous. The suggestion is made that the employer might protest that he cannot carry on his work owing to the agreement, but the idea is that, the day before notice is due to expire the employer might put up a notice to say that if they would work below the terms agreed upon he would continue his works. That is a very difficult thing to do. If the employer is still a member of his association he will have to deal with the association. If he is not a member of his association, he is a free man, able to take his own line; he may be more or less coerced by the opinion of his fellow employers: or he may have his men come out on strike. But that this difficult question which requires an Act of Parliament by itself should be settled by an officer of an employment exchange or by a referee or umpire, and should be dealt with by a subsection in a Bill hurried through at the last moment, is most objectionable.

Amendment moved— Page 5, line 21, leave out from ("dispute") to the end of subsection (1).—(Lord Askwith.)


In order to preserve the Amendment down in the name of the Lord President I will put the Question that the words "or that" stand part of the clause.


The noble Lord has taken a convenient course in discussing his own Amendment and the one which stands in my name on the Paper. I should like to draw the attention of the House to one or two points. The first is this. We are dealing in this subsection with a trade dispute, and, as the noble Lord knows, where an employer commits a breach of a district or national agreement to which he is a party and his workpeople decline to continue, a trade dispute arises. What we have to consider is whose fault it is. Is the workman in default in a matter of this kind? I think it is clear under my Amendment that the workman is not in default at all. These are the words I propose to substitute for the last few lines of the subsection:— such trade dispute was due to the employer at the factory, workshop or other premises at which the insured contributor was employed having committed such a breach of a national or district agreement to which the employer vas a party as directly affected the conditions of employment of the insured contributor or of any members of a grade or class of workers to which the insured contributor belonged. The whole basis of the claim for compensation in those circumstances is that the default came from the employer alone.

The stronger argument used by the noble Lord is this. He said, assuming there is a trade dispute in relation to which the workman claiming compensation is not in default at all, you have a difficult matter to decide as to whether there is a breach of a national or district agreement. I do not think that is any more difficult than other matters with which unemployment committees have to deal. I only wish the noble Lord himself could deal with these matters: I am sure he would find no difficulty at all. I do not think an innocent workman should be deprived of the insurance benefit to which he would otherwise be entitled. It is far wiser to make it clear that where the default comes from the employer's side the workman is not to suffer as regards insurance benefit. And why should he? The real answer to the noble Lord is the difficulty of protecting him. He does not deny that the difficulty is there, nor does he deny that the worker in these circumstances ought to have the insured benefit to which he is entitled. Where I differ from the noble Lord is in thinking that this is a matter of such great difficulty as to deprive a man of a benefit to which he would otherwise be entitled. The drafting of the Bill is very difficult. I said so on the Second Reading. I have consulted the draftsman and the result-is the Amendment which stands in my name. I hope your Lordships will allow that Amendment to pass as a fair solution of this difficulty.


I will only say a few words on the relative values of these two Amendments. My feeling is that you are asking the Fund to take sides in a question as to whether or not there has been a breach of an agreement. That is a very dangerous thing to do. It would be wiser in the end to leave these words out altogether. It is very difficult for even the most experienced person at times to say, first, whether an agreement is binding upon everybody whose name is in it; secondly, whether there has been any breach of that agreement; and, thirdly, whether the trade dispute is bona fide due to a breach of the agreement. If the Amendment of the noble and learned Lord is carried all these questions would have to be considered and determined either by the manager of an employment exchange or, possibly, by the local committee. One knows very well what acute feelings arise on a matter of this kind and how very difficult it is to judge between the conflicting contentions of both sides in a trade dispute. I think it would be unfortunate if Parliament provided by this Bill that a question of that kind should be brought into discussion upon the question whether a man should or should not be entitled to benefit out of the Fund. I venture to think, although I do not pretend to the experience of my noble friend, that he is right, and that it would be better to excise these words altogether from the Bill, and to leave the question to be decided by the other conditions.

Clause 4, as amended, agreed to.

Clauses 5 to 7 agreed to.

Clause 8:

Abolition of power to make special schemes.

8.—(1) The power of the Minister under Section eighteen of the principal Act to make special orders approving or making special schemes shall be suspended until the expiration of one year from the termination of the deficiency period referred to in the Unemployment Insurance (No. 2) Act, 1921:

Provided that the foregoing provision shall not affect the operation of any special scheme duly approved by the Minister before the commencement of this Act or the power of the Minister to approve a scheme if a draft thereof appearing to him to be complete was submitted to him before the third day of April, nineteen hundred and twenty-four, and application was before that date made to him to approve the scheme in accordance with the provisions of Section eighteen of the principal Act.


I have a drafting Amendment to this clause to omit from the proviso to subsection (1) "the operation of any special scheme duly approved by the Minister before the commencement of this Act or."

Amendment moved— Page 7, line 42, leave out from ("affect") to the end of line 1 on page 8.—(Lord Parmoor.)

Clause 8, as amended, agreed to.

Clause 9:

Amendment as to refunds of contributions.

9.—(1) If on an application made under this section the Minister is satisfied that any person who is or has been an insured contributor had before the date on which this section comes into operation—

  1. (a) paid contributions in respect of not less than fifty weeks in accordance with the general provisions of the principal Act; and
  2. (b) reached the age of fifty years;
that person or his personal representative shall be entitled to be paid out of the unemployment fund a sum representing the present worth as on that date of the excess value of the contributions paid by him together with (in the case of an insured contributor who has not attained the age of sixty years) compound interest at the rate of two-and-a-half per cent, per annum on the amount of that excess value from the date aforesaid until the date on which he would attain the age of sixty years.

(3) For the purposes of this section— c)The present worth of the excess value of contributions shall be calculated in manner prescribed by regulations, and any regulations made for that purpose shall direct that in making the calculation regard shall be had, among other matters, to the fact that contributions may cease for a period comprising five insurance years to be paid in respect of the insured contributor, and, in the case of an insured contributor who has not attained the age of sixty years, to the fact that he may not live to attain that age.

LORD PARMOOR moved in subsection (1), to leave out "excess value of the contributions paid by him together with", and to insert "amount of the excess value of the contributions paid by him as increased". The noble and learned Lord said: I think I ought to say one word in explanation of this Amendment. It has to do with compensation, where you deprive a man of the benefit he now has at the age of sixty. I wish to make it clear that he is entitled to benefit only as regards "the amount of the excess value of the contributions paid by him," and so on. It is on the excess value that he is entitled to compensation. I do not think that this was clear as the Bill stood. The remainder of my Amendments to this clause are consequential upon this Amendment.

Amendment moved— Page 9, line 11, leave out from the second ("the") to ("in") in line 13, and insert ("amount of the excess value of the contributions paid by him as increased").—(Lord Parmoor.)

Amendments moved—

Page 9, line 14, after ("years") insert ("by").

Page 10, line 21, after the second ("the") insert ("amount of the")

Page 10, line 22, after ("contributions") insert ("as increased by any such compound interest as aforesaid (if any)").—(Lord Parmoor.)

Clause 9, as amended, agreed to.

Clauses 10 to 16 agreed to.

Clause 17 (Short title, repeal, decision of questions, application and commencement):

LORD PARMOOR moved at the end of the clause to insert the following new subsection:— (6) The Minister may by regulations provide for the transition from the provisions of the Unemployment Insurance Acts, 1920 to 1924, to the provisions of those Acts as amended by this Act.

The noble and learned Lord said: It is proposed to introduce this subsection in order that the Regulations may provide for the transition from the provisions of the existing Insurance Acts to the provisions of those Acts as amended by this Bill. It is a purely administrative matter.

Amendment moved— Page 15, line 15, after subsection (5) insert the said new subsection.—(Lord Parmoor.)

Clause 17, as amended, agreed to.

First and Second Schedules agreed to.

Third Schedule:

Enactments Repealed.
Session and Chapter. Short Title. Extent of Repeal.
10 & 11 Geo. 5. c. 30. The unemployment Insurance Act, 1920. Section two, subsections (1), (2), (4), (7), (10) and (11) of section eighteen, section twenty-five subject to the provisions of this Act, in paragraph (e) of subsection (1) of section forty-seven the words from "and (iii) for" to the end of the paragraph, and the Second Schedule.


I have two drafting Amendments to the Third Schedule.

Amendments moved—

Page 20, lines 5 and 6, leave out ("subsections (1), (2), (4)") and insert ("subsection")

Page 20, line 6, leave out ("(10) and (11)").—(Lord Parmoor.)

Third Schedule, as amended, agreed to.


It was arranged, I think, that the Report stage should be taken to-morrow. It really looks as if there would not be any dispute on Report, for nothing has been left over, and we would not seek to re-open these questions.