HL Deb 14 June 1934 vol 92 cc1117-23

Provisions of Unemployment Insurance Acts of which amendments may be recommended by Committee.

LORD ROCHESTER moved, in paragraph 1 of Part I, to leave out "three nor more than five" and insert "four nor more than six." The noble Lord said: This is a matter of rather greater substance. I want to be quite frank with the House. Though your Lordships have not put additional work upon the Statutory Committee, the debates in the other House have indicated possibilities of additional work. It is, therefore, felt that we ought to add at least one to the number of the members of that Committee, and the purpose of this Amendment is to increase the membership by one. I beg to move.

Amendment moved— Page 63, line 6, leave out ("three nor more than five") and insert ("four nor more than six").—(Lord Rochester.)

On Question, Amendment agreed to.

EARL BUXTON moved to insert in Part II of the Schedule:

"The Unemployment Insurance Act, 1929 Section one Exchequer contribution."

The noble Earl said: This is an Amendment which my noble friend Lord Rhayader and I have put down at the request of some of our friends in the other House, to meet a point which appears to have been omitted, or at all events not properly considered. The point is this. Under Part I of the Act a Statutory Committee is established, and the object of its establishment has always been taken to be to secure the solvency of the Fund. For that purpose it is to advise on questions as to the amount of benefit and questions as to the amount of contribution, which are to be reconsidered from time to time, and the provisions as to which are, if necessary, to be amended in some respects. The general idea when the Bill was going through the other House was that the Statutory Committee had full power under the Bill and the amendments enacted of previous Acts to deal with this matter as they thought best, that is to say, that they had full power of raising or reducing benefits and of raising or reducing contributions. But it now appears that under the Unemployment Insurance Act, 1929, the contribution of the Treasury has to be in the exact proportion stated in that Act as compared with the joint contributions of the employer and the workman, and that Act has not been amended or repealed, unlike the other Acts, so that that matter has not been placed in the discretion of the Statutory Committee for them to deal with as they think best.

I think that must be an omission from the Bill. If this Amendment is accepted it will enable the Statutory Committee to deal with this matter as they think best, and unless they have this power, their opportunity of dealing with the matter from the point of view of the solvency of the Fund will be very much diminished, especially their power of dealing with reductions in contribution. To my mind it is important from the point of view of diminishing unemployment that the question of the reduction of contributions should take precedence even of an increase in benefit, for the reason that the burden of unemployment insurance bears very heavily on the various industries. The various contributions of an employer on behalf of the men amount to between £4 and £5 per head per annum. It appears to me that the best way of dealing with the problem of unemployment is to relieve industry of this heavy burden of taxation, and it is believed that when the Statutory Committee have got the Fund on to a better and more secure basis, the first thing they will do will be to reduce the contributions in order to relieve the burden of these charges upon industry.

I would point out, too, that the position is materially worse now than it was before the Bill was introduced, because under Part I not only has the general position been placed on a sound basis so that the benefits and the contributions balance one another, but, as your Lordships know, a very large sum has been put on to the Insurance Fund in order to repay the debt which was incurred during the years when money was being borrowed, and the Fund will have to meet something like £5,000,000 a year. It is true that the Chancellor of the Exchequer has relieved it to a small extent, by about £500,000, but the burden still remains. Many of us think it is an unjust burden that the whole of that is put on the Fund. The result of it will be that for some years to come there will be no possibility of giving increased benefits or reduced contributions, and that is, I think, a very serious matter. I think this point must have been overlooked when the Bill was passing through the other House, because it was certainly stated by the Government that the main object of the creation of the Statutory Committee was to enable it to deal with benefits and contributions with a per- fectly free hand. I have therefore put down this Amendment to meet the point by including Section 1 of the Act of 1929, in order to give that freedom of action to the Statutory Committee. I hope that my noble friend will be prepared to accept the Amendment.

Amendment moved— Page 64, line 31, at end insert

("The Unemployment Insurance Act, 1929 Section one Exchequer contribution.")
—(Earl Buxton.)


If my noble friend Lord Buxton will forgive my saying so, I confess that I am not a little surprised at his speech, because it seems to me to have gone a long way to sustain the Government's position in not including this section of this Act in the Schedule. As I understood him, he said that it was thought in the other House that this discretion was in the Bill. The noble Earl agrees. But I would point out to the noble Earl that it could not he in the Bill unless it were included among those things which are enumerated in the Third Schedule, and it was deliberately excluded because so far as the Exchequer contribution was concerned the Government wanted to keep alive the condition that it should be one half of the aggregate of the other two. So far from endangering the solvency of the Fund, it is a safeguard to have it excluded from the Schedule, because if the Statutory Committee thought fit to recommend a reduction in the contributions of the other two, ipso facto they would be recommending a reduction in the Exchequer contribution as long as it remained one half of the sum of the other two. I hope that that is clear?




For many reasons we could not accept this Amendment. May I point out to the noble Earl, too, that if we accepted it, it might have an effect exactly opposite to that which he wants. If this were included in the Schedule the Committee might make a recommendation to the Government, and the Government—not, I suggest, the present Government, but a Government of some future time—might reduce the contribution of the National Exchequer just as it would have the right to increase it on recommendation. I hope, therefore, that the noble Earl will appreciate that in any case if we accepted this Amendment we should be running the risk of a further charge coming upon the Exchequer. I suggest to the noble Earl—and nobody is more alive to the position than he is, having held positions of such responsibility in previous Governments—that that would raise the same point to which I referred on two occasions already this afternoon, the question of the Privilege of another place. I therefore hope that the noble Earl will see that in any case we could not possibly accept this Amendment, and I suggest to him that it would have exactly the opposite effect to that which he envisaged when he was speaking.


The noble Lord in charge of the Bill has taken refuge in the contention that this is a Privilege Amendment which we are not entitled to make.


Forgive me, I said that apart from that altogether we could not agree to it.


Let me deal with the latter point first. I think it is perfectly true that neither your Lordships in this House nor any private Member of the House of Commons could put down this Amendment and carry it if Privilege were pleaded, but the noble Lord has not told us, or at least has not sufficiently told us, I think, why the Government do not propose it. It would not be a breach of Privilege if in the other House the Government added this Amendment to the Bill, and then the Statutory Committee would be free to deal with the contributions to the Fund as they saw fit. I do not think that the objections which the noble Lord has put forward are quite convincing. There is a very general impression that the Government have overloaded the Fund with debt incurred in previous years. I regret very much that they were not able to deal more generously with the Fund than to transfer to the Fund the whole burden, or almost the whole burden, of the debt. It may well be that the Statutory Committee may come to the conclusion that the time has arrived when the contribution from industry should be diminished. As the Bill stands they will not be able to reduce the industrial contribution unless they reduce the Exchequer contribution and the double reduction would have the result of depleting the Fund. The net result is that there must be long delay in any alleviation of the payments by industry. I think the Government should take this point into consideration, and I hope the noble Lord will lay the matter before his colleagues.


I am not going to press the point of Privilege, but apart from that I thought I made it plain that in the Government's view there should be no power other than by legislation to change the existing provisions. If the contribution from the employers and employees be reduced then half the sum of that total will ipso facto be reduced in the Government's contribution. More than that I cannot say.


It is, I understand, a matter of Privilege, and I do not intend to press the Amendment to a Division. I regret, however, the Government's decision. The object of the Amendment is to give freedom to the Statutory Committee to deal with this matter of the industrial contribution, and unless the Amendment is accepted they cannot deal with a reduction in the contribution of the employers and employed unless at the same time they make a reduction in the Treasury grant.


As long as they keep the ratio intact they can make a reduction.

Amendment, by leave, withdrawn.


These next Amendments are all consequential upon changes made in another place.

Amendments moved—

Page 64, line 50, leave out ("Amendments as to meaning of unemployment") and insert ("Provisions as to rates of benefit").

Page 64, line 52, after ("to") insert ("disqualifications for benefit and as to").

Page 65, line 23, at end insert: ("Second Schedule.—Weekly rates of ununemployment benefit").—(Lord Rochester.)

On Question, Amendments agreed to.

Third Schedule, as amended, agreed to.

Fourth Schedule agreed to.

Fifth Schedule:

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