§ THE PAYMASTER-GENERAL (LORD HUTCHISON OF MONTROSE)My Lords, I beg to move that the Draft Order, as reported from the Special Orders Committee, be approved. I do not know whether noble Lords opposite want me to say anything on this subject now, or whether they would prefer that I should speak after they have spoken.
§ LORD MARLEYPerhaps it would save the time of the House if the noble Lord spoke afterwards.
§ LORD HUTCHISON OF MONTROSEThen I beg formally to move.
§ Moved, That the Draft Order, as reported from the Special Orders Committee on Wednesday the 25th of March last, be approved.—(Lord Hutchison of Montrose.)
§ LORD MARLEYMy Lords, I want to point out to the House exactly what 411 this means from our point of view, and then the Minister will no doubt counteract what I have to say and point out how wrong I am. The Unemployment Insurance Fund has accumulated an annual excess of income of £6,500,000 and one of the reasons for that annual excess of income is that unemployment has been reduced, for which we are all very thankful; but the other reason is that the benefits paid out of this Fund to the unemployed are far too low. Your Lordships will remember that when we were discussing the case of agricultural workers a few days ago, I quoted a speech from the Minister in another place, in which he pointed out that so low were the benefits paid by the Fund that a large number of beneficiaries had to seek public assistance to supplement those benefits in order that they might live at all. We on these Benches therefore strongly resent that this surplus of £6,500,000 should be used to reduce the payments by the Government, the employers, and the workers, rather than be used to give the additional benefits which are necessary in order that those who become unemployed may live at all.
For this reason we say that the advice given by the Unemployment Insurance Statutory Committee should not in fact be approved by your Lordships' House. We say that, as a duty to the unemployed, who are unemployed through no fault of their own, we should send this question back to the Statutory Committee with the intimation that we do not approve this recommendation, but that we desire instead that this surplus should be used to give extra benefits to those for whom the Fund was established, and who are not getting enough out of the Fund to live. It is a fact that this penny reduction makes almost no difference to industry. The Statutory Committee say there will be relief to industry. It has been calculated that in the construction of a cargo vessel costing £90,000 this reduction of a penny in the weekly rates of contributions, which we are asked to approve this afternoon, makes a difference to the builders of that vessel of only £43. It is simply throwing away this surplus without any real benefit to industry when the £6,500,000 might be used to give a real living to the unemployed people by a slight increase in benefits.
412 In the same way the reduction of the contributions by a penny amounts in the whole of the cotton industry to £60,000, and the total value of the production of the cotton industry every year is £132,000,000. What is the good of offering £60,000 to an industry the value of whose product is £132,000,000? It is simply a drop in the bucket, it is of no real value, whereas if the money were given to the unemployed for whom this very Fund was established, it would make it possible for these unfortunate people to live. We feel very strongly that your Lordships would not desire to inflict an injustice on those for whom the Fund exists, and we therefore urge that the House should not accept the recommendations of this Statutory Committee, but should return them for reconsideration and report in the opposite direction.
§ LORD HUTCHISON OF MONTROSEMy Lords, the reason I asked the noble Lord if he would like to make his remarks first was that I did not want to put up dollies and then knock them down. I am very much obliged to the noble Lord for putting his point of view, with which, I may say, the Government have every sympathy. We appreciate that the noble Lord feels very strongly on this subject, but it should be remembered that the scheme we are dealing with is an insurance scheme. It has not really anything to do with what I may call the means of subsistence of the individual who receives the benefit. This insurance scheme is based on the contributions paid. It should be remembered that out of the seven members of the Statutory Committee who examined this question five took the view that the Government are now taking. They said, and I think properly, that the rates which are now existent were the rates which were established by the National Economy Act and which have never been reduced, whereas in many cases where special measures were taken to meet the crisis of 1931—the cuts and other things—the position has been restored while these contributions have remained the same. Therefore the Committee consider it is only fair to industry as a whole that the first surplus that has come along and which, as the noble Lord rightly says, amounts to £6,500,000 per annum, ought to be used for the reduction of contributions.
413 It is undoubtedly true that these rates, along with other rates, of course, are a very sensible weight on industry. His Majesty's Government have been doing everything they can to foster and push along industry in order to revive employment in this country, and, if I may say so, they are doing it with a certain amount of success. There is also this point—and I am sure noble Lords opposite will not think I am trying to make political points in any way—that if we increase the amount of benefit, when we come upon a less favourable period in industry it is much more difficult to reduce the benefit than it is to put up the contribution. I think that will be admitted, and I have no doubt it was one of the reasons that induced the Committee to take the view they have taken. Another point which I think is valid is that the statutory provision for unemployment under this scheme is substantially higher than that for sickness; that is, on the health side. In many cases it does approach the wage value. Immediately you try to raise the benefit too high, you have a tendency to compete with wages.
Be that as it may, the Government are undoubtedly guided very largely by what the Statutory Committee recommended, and they feel it would be very difficult indeed to go against the decision of the Committee. They feel it would be better for the country as a
§ Resolved in the affirmative and Motion agreed to accordingly.