1 MARCH 1924, Page 4

TOPICS OF THE DAY.

UNIVERSAL. INSURANCE.

A SUBSTITUTE FOR SOCIALISM.

WHATEVER view we take of the merits in the Poplar case, one thing is certain—the speeches of the leaders on all sides were funeral sermons on the Poor Law. That system has broken down morally and financially. We cannot go on as we are going now. Our expenditure on Public Assistance of all kinds is eating out the vitals of the nation. What is even worse than our financial demoralization is that we are not giving the mass of the workers that help which they could receive were our system of assistance saner and better organized. We are manufacturing paupers, and that in the most expensive way possible.

Feeling as I do that the Poor Law system must go, I shall consider here only that which I believe the Govern- ment and the leaders of all parties will have to consider later whether they like it or not—a workable plan to replace our present scheme of Public Assistance. In my opinion, we must adopt a system of Universal and " All-in ' Insurance "—a system which will protect the working man and the working woman from the four great evils which now face them. These evils are :—(1) Unem- ployment. (2) Sickness and accidents. (3) The risk of a wife and young family being left with no worker to support them. (4) Old age.

The State already, through the Poor Law, the Dole, Health Insurance, Allowances for Widows (just approved), and through many minor channels, spends over £90,000,000 a year on assistance, and spends it very wastefully. What the State is giving now is, for the most part, not insurance, but substitutes for insurance. But between these two there is a real and a very great difference. No man can receive money from the State without a feeling of dependence if he has not earned it or contributed thereto. When he has contributed to the sum he draws he feels that he is taking what is due to him and not a mere dole. But under the Poor Law the State does not merely provide a squalid substitute for insurance, but provides it inadequately. It also does so with extreme waste and extreme inefficiency. In some cases it is calculated that more than half the money drawn from the tax-payer and rate-payer and expended in Public Assis- tance is dissipated in expenses of administration.

There are two concrete plans before the country for Universal Insurance. One is that of Sir William Beveridge. The other is put forward by Mr. Broad, a former Liberal Member of Parliament, who has devoted -himself to the study of this subject. Sir William Beveridge's scheme is set forth in detail in No. 7 of a series called " The New Way Series," published by the Daily News, and issued under the auspices of the Liberal Summer Schools, price 6d. Mr. Broad's scheme, which has been the subject of many conferences and private meetings, has not yet been published ; but I hope later to give some of its details and figures in the Spectator. Personally, I consider Mr. Broad's scheme the better of the two. It is somewhat more expensive in appearance, but it is more efficient, and is based on the principle that whenever assistance is given it must be adequate. 'Further, the Broad scheme abolishes the Poor Law root and branch. We shall never get any satisfactory reform in this matter unless the Poor Law goes lock, stock and barrel. Mr. Broad's scheme proposes to insure men and women against the four evils named above in the following way. Women in sickness are to have twenty shillings a week, men thirty shillings ; unemployed women twenty shillings ; men thirty shillings. Old Age Pensions at sixty-three are at first to be fifteen shillings for women and twenty-five shillings for men, rising in six years to twenty shillings and thirty shillings respectively. Widows are to have twelve shillings and sixpence a week, and their children up to fifteen years five shillings a week. Medical benefits are to be the same as now.. Benefits, so large will, at the first view, make people exclaim " This is magnificent ; but it means bankruptcy." Mr. Broad, however, shows, and I am inclined to think on good grounds, that it need mean nothing of the kind. He would make his working woman contribute ls. per week for insurance ; his men contribute ls. 6d. ; the employers of all kinds 2s. 6d. ; and the State ls., instead of as now, 11d., ls. 2d., ls. 3d., and 9d. respectively. The total cost he estimates at £216,400,000 a year. Of this sum the State would have to contribute £44,000,000 a year. What are we doing now ? On the Poor Law alone the State spends £40,000,000 a year, and, owing to the reckless relaxation of administration which no one can now stop, this sum is going up by leaps and bounds. On Old Age Pensions it spends £24,000,000, upon Health Insurance 19,000,000 ; and upon Unemployment £13,000,000, or, in all, £86,000,000 a year. To this must be added the pensions for widows now sanctioned. These will cost at least £4,000,000 a year. Therefore in round figures we are already spending at least £90,000,000 a year in Public Assistance and probably a good deal more. It must not be supposed, however, that the State would under the Broad scheme make a saving of £50,000,000. He calculates that it will be necessary to place something like £60,000,000 a year to a reserve fund, till that reserve fund has reached £3,000,000,000. The cost of the scheme during the first sixty-three years will increase annually by a sum roughly equal to the annual interest on the £60,000,000. set aside each year for the reserve fund.

I hope later to deal with many of the points in Mr. Broad's scheme and put to him one or two conundrums of my own, which I trust and believe he will be able to answer. At present what ought to be done ? In my opinion, there must be no squalid party squabble as to who is to have the honour of introducing Universal Insurance. The matter is too serious for that. I own that I am somewhat alarmed by the stories I hear now of people in all three parties declaring that the party which passes Universal Insurance will be in for twenty years ! It must obviously be an agreed measure, and I would get this agreement first by a short conference of the leaders of the three parties, the Prime Minister and Mr. Philip Snowden for the Labour Party, Sir Robert Home for the Unionists, and Mr. Asquith and Sir John Simon for the Liberals. They should first agree upon certain clear and fixed principles and then upon a Select Committee of the House of Commons to consider the whole business and suggest a working scheme. The instructions should be : (1) Examine and compute the whole amount of public money local and central which now goes to Public Assistance. (2) Propose a scheme for Universal " All-in " Insurance which will enable the Poor Law as well as other forms of Public Assistance, central and local, to be abolished ; and (3) so draw the scheme that there will be no more- spent on Public Assistance, including the money sanctioned for Widows' Pensions, than there is at present. This last condition is essential. When the Committee has reported, the scheme should be passed as an agreed measure like the Constitutional revolution produced under Lord Ullswater's auspices at the end of the War.

J. ST. LOE STRACHEY.