UNEMPLOYMENT INSURANCE (NORTHERN IRELAND AGREEMENT) BILL. (Hansard, 19 March 1929)

§ THE CHANCELLOR OF THE DUCHY OF LANCASTER (LORD CUSHENDUN)
My Lords, this is a Bill for making permanent an arrangement which was come to in 1926 between His Majesty's Government and the Government of Northern Ireland for equalising the burden borne by the two Exchequers in respect of their unemployment insurance. I do not think I need go at any length into the reason for that because it is probably well known to your Lordships. The accumulation of debt, or rather the deficit of the Northern Ireland Insurance Fund, which it was hoped in 1926 would be temporary, is now apparently so nearly permanent, or probably permanent, that it is thought best to make a permanent arrangement by this Bill which, with slight modifications, continues the arrangement that was made in 1926. This is done by providing that the Unemployment Funds of the two countries shall be kept in a state of parity on the basis of the insured population by means of an additional Exchequer Grant to the poorer Fund.
The deficit on the Northern Ireland Fund, had on September 30, 1925, reached a figure of £3,615,538 as compared with a deficit in this country of £8,262,001. That represents an infinitely higher debt in Northern land than in this country. In fact, I believe that it was stated in another place that the equivalent debt in this country would be a debt of £200,000,000, and therefore the equitable case for dealing with this matter is, I think, very apparent. On the basis of the insured population the Irish deficit would have been only a sum just over £191,000, and therefore the excess debt to the Irish Fund was £3,424,434. It is this that has to be dealt with, and the Government of Northern Ireland have undertaken to take steps immediately, under the agreement which is scheduled to the Bill, to 677 extinguish the excess debt, and they propose to do so by writing off immediately, before the end of the present month, a sum of,£424,434, and further writing off £100,000 each year until the debt is extinguished. I think that those are all the particulars which it is necessary for me to give to your Lordships, especially at this rather late hour, but, of course, when we get into Committee, it will be open to any of your Lordships to raise any points, and I shall be ready then, I hope, to answer any questions that may be put to me.

§ LORD ARNOLD
My Lords, I think it is an unfortunate circumstance that this Bill should come on at such a late hour. I made representations in the hope that it would be put down for another day, because it is a Bill that should receive very careful consideration. It is not certified as a Money Bill, and it is really a measure which represents one of the most indefensible things that has been done by the present Government. It has been introduced to us by the noble Lord in a very brief speech, as if there were really very little at stake, but, as a matter of fact, it is a very strange and, in my view, an unprecedented measure, as I think I shall he able to make clear. The Bill gives out and out to the Government of Northern Ireland a certain sum of money this year—about £460,000, I think—and, so far as can be seen, a suns will have to be paid annually under this Bill by the British taxpayers to the Government of Northern Ireland for many years to come. So far as the Labour Party is concerned, we do not say that help should not be given to the Unemployment Fund of Northern Ireland, having regard to the difficult circumstances that obtain there. That is not our position. What we do say is that money so provided by the British Exchequer should be in the form of a loan, and not of a gift. We say that the Fund should be on all fours with our Fund here. When the Unemployment Insurance Fund here runs into debit, money is advanced on loan—it is not given out and out—and then the hope is that in due course, with better conditions of trade, the deficit will gradually be wiped out with the normal 678 operation of the Fund. But in any case the money is not given. It is a loan.
What is the justification for making this differentiation between the Fund in Northern Ireland and the Fund in Great Britain? If I may say so with respect to the noble Lord, he really attempted no justification whatever, except that this was a continuation of the Act of 1926. It certainly is a continuation of that Act, and that is what we complain of. We opposed that Act, and we oppose this Bill. That Act did for the time being, until 1930, make this Government payment a gift instead of a loan, and we protested strongly against it at the time. I have no hesitation in saying that, if it had been proposed by a Labour Government to make a provision of this kind for some gift to some other part of the Empire than Northern Ireland, it would have caused the strongest feeling in this House, and very strong speeches would have been made about it. Since 1926 we have found for the Northern Ireland Unemployment Fund £2,500,000. This year we are to find another £465,000—I think that is the sum—and altogether there is a debit on that Fund of about £2,500,000.
It is quite true, as the noble Lord has said, that the Northern Ireland Government has undertaken to find £400,000, and that the remainder will be paid back, as we are told, at the rate of £100,000 a year, and that this will take thirty years. That is a very long time, even if the payments are to be made regularly. But I think it is right to say—the noble Lord did not tell your Lordships this—that we are bearing three-quarters of the interest on the debit of £3,000,000, which comes to £113,000 a year. The British taxpayer is bearing this and, at any rate until certain payments have been made, we shall actually be out of pocket on the transaction, so far as I can see. At any rate, there is not very much in it, even if they pay off £100,000 a year. We are finding, in the first instance, £113,000, and that will continue until the sum due to us has been reduced year by year.
There is one point about this extraordinary transaction that I should like to put to the noble Lord. It is stated in the White Paper (Cd. 3271) which explains this Bill that— The Agreement is reciprocal, and if at any time unemployment in Northern Ireland became less heavy than in Great Britain, the Exchequer of Northern Ireland 679 would be liable to contribute to any payments made by the British Exchequer to the British Unemployment Fund to bring it into parity on the basis of insured populations. I say that this is a very misleading paragraph. In fact, it is more than misleading, for it gives an impression that is entirely false. I put it to your Lordships, or to the handful of your Lordships who are present, that this would be read by any man to mean that these Funds are really on a reciprocal basis, that we Day money to Northern Ireland now, but that, if unemployment in Northern Ireland should fall below the rate here, they would be liable to pay a certain amount to us. That is not the case at all. The true position is not revealed. If I am wrong the noble Lord will correct me, but I should like to ask him if it is not the fact that the Government of Northern Ireland would not be liable to pay a brass farthing to this country unless we altered the whole basis on which we conduct our Unemployment Fund. If our Fund runs into debit the advance is regarded as a loan. Is it not true that these words mean, if you go into them carefully—it is all so wrapped up that one almost requires a microscope to find out the actual truth—that the Northern Ireland Government would not be liable to pay a brass farthing unless we began doing here what we are now going to do for them, and made the excess payments a gift instead of a loan? That is the point that I want to put. I say, therefore, that the White Paper is most misleading. It is bound to create in the mind of any one who reads it an impression contrary to the facts. I do not think that it is a right thing that a White Paper like this should be put before Parliament. It really conceals the true state of affairs.
Let me put another question to the noble Lord. Is it not a fact that under this extraordinary agreement even if the Northern Ireland Unemployment Fund began to pay its way and if, despite that fact, unemployment there became worse than here, we should still have to pay money? Supposing for the sake of argument that the figure here was 3 per cent., and in Northern Ireland 6 per cent., both countries would be below the figure which has been adjudged the balancing figure; but even so, as I understand it, we should have to make a contribution. We should 680 have to pay a dole—that is what it comes to—to the Northern Ireland Government., although at the moment there was no deficiency on their Fund but it was actually in credit. I put that question to the noble Lord. Is not this what the agreement comes to? I put these two specific questions to him. As I read it, that is what it means, and I think I am right.
We are told in this White Paper that, if at any time the amount that we may be liable to pay should exceed £1,000,000 a year, then we can reopen the question on its merits. There is very little consolation in that. Is it really suggested that that is a provision which in any way justifies what is being done? It is not a provision which really has any satisfactory features for us in practice, because the whole transaction, I think, is so objectionable. Not only so, but it is, without using too strong language, very nearly unconstitutional, because the Chancellor of the Exchequer himself, in another place, admitted in effect that the reason why the Government are doing this now is that they fear, and their fears are well grounded, that in a very few weeks they will be out of office, and they do not think that the next Government would do this, and so they are doing it now when they have their chance. In effect that is what the Chancellor of the Exchequer said. He was asked why he was hurrying over this, seeing that the present Bill does not come to an end until 1930, and he said they were doing it now because then they could be sure it would be done, or something to that effect. It is not the first time that this Government have been trying to bolt the door and lock the windows, and make all secure, so that their successors, with the authority of the people behind them, should not be able to do things. I wish to make it clear, in conclusion, that we are not objecting to helping the Unemployment Insurance Fund in the present distressful days in Northern Ireland, but that we are objecting to making this payment out of the British Exchequer in the form of a gift instead of in the form of a loan. I should be very much obliged if the noble Lord will reply to my question.

§ THE LORD CHANCELLOR (LORD HAILSHAM)
My Lords, I have received the figures of the Division. It appears that there are fewer than thirty Peers present. Therefore, under Standing Order XXXIII, I declare the Question 682 not decided, and the debate thereon adjourned to the next sitting of the House.

CONTENTS.
Hailsham, L. (L. Chancellor.)	Lucan, E. [Teller.]	Cushendun, L.
	Vane, E. (M. Londonderry.)	Gage, L. (V. Gage.) [Teller.]
Sailsbury, M. (L. Privy Seal.)	Younger of Leckie, V.	Templemore, L.
NOT-CONTENTS.
Beauchamp, E.	Arnold, L. [Teller.]	Olivier, L.
		Thomson, L. [Teller.]