THE NEW RELIEF SYSTEM
• By RONALD C. DAVISON
THE Measure which will be known to history as the TJnem-plOyment Act, 1934, may now be assumed to , be in final shape, and, although the Bill has yet to survive a number of Parliamentary processes, the lines of its future operation are clear enough. Altogether, it amounts to a major. piece of domestic reconstruction, involving changes in much of our social. seenerY. Not only insur- ance, but education, poor law and the technique of central and local administration are closely affected. All the neV-i. provisions are more generous than _those which they- -replace. They mark the* close of the res- trictive era which began with the Anomalies Act of the Labour Government in July, 1931. Now, once again, as in the years up to 1930, the pendulum is swinging the other way. The 1931 benefit cuts are restored, the duration of benefit as a right is lengthened (for good con- tributors) from 26 to 52 weeks, and a new chapter is to be opened in the care and supervision of juvenile labour. Above all, the second part of the Bill heralds a revolu- tionary experiment in the relief of urban and rural poverty,, wherever it is associated with lack of wage- earning employment. Actually, the scheme does not cater for the whole of the able-bodied poor as such, since it excludes a million citizens of the lowest income class who happen to work on their own account. Still, a line has to be drawn somewhere, and a relief system covering 17,000,000 wage-earners, representing over 34,000,000 people, is wide enough to go on with.
Take, first, the future of the 13,000,000 insured. The weekly rates of contributions (10d. each from employer, worker and the State) are not changed, but the benefit rates will be raised in July by 10 per cent. to 17s. for a man over 21, 15s. for a woman and 9s., allowance for a dependent adult. The allowance for a child remains at 2s., since it was never touched by the 1931 cuts. At the end of _26 weeks' unemployment a man and wife with no children will have drawn £34 in benefit—not a bad return for 30 tenpences, which is the minimum contribution. And they can in future go on drawing at the same rate for another 26 weeks if the claimant has had fairly steady contributory employment over the five years preceding his claim. The latter extension will, of course, 'bring back into benefit quite a number of the un- employed (say, 200,000) who have now exhausted their claims and have either been on the needs test scheme or have been drawing nothing at all. Altogether, on July 1st, insurance benefit should cover, not a minority of the two million unemployed claimants, as at present, but a considerable" majority. All the same, there is room for doubt as to' the wisdom of thus lengthening the period of benefit at the cost of some L8,000,000 a' year instead of using the money to reduce contributions. Assuredly, the present tax upon employment of is. 8d. a man is too high.
More attention is to be paid to adolescent workers. In future, the moment they leave school and seek employ- ment young people will become insurable and will, in some degree, come under the eye of Juvenile Employment Committees attached to the. Employment Exchanges. In itself, juvenile insurance will not amount to much, either in contributions (2d.) or benefits (2s.), the latter being payable only to unemployed parents. The project that is really behind all this is that in future "to be unemployed" shall no longer mean "to be unoccupied." Potentially, the age of school attendance is being raised at one stroke to 18, but only for unoccupied adolescents and only at the discretion of the Ministry of Labour, Local Assessors, who may in practice be the existing Juvenile Employment Committee, are to see that the requirements are reasonably selective, but even so the Act will take a lot of enforcing. That is why the Ministet of Labour is assuming still another new power, the power to compel employers to notify all discharges under 18. In effect, what will happen will be that the boys' and girls' unemployment books will have to be posted off to the Exchanges on the day of discharge. That will give the machinery of enforcement a chance to become effective.
Last, but by no means least, part 2 of the Bill makes a wholly new attack on the old problem : How can we couple our limited liability insurance with some kind of secondary and non-contributory relief system appropriate to carry the remainder of the burden? Since 1931, the Ministry of Labour has met the problem by calling in aid the services of the Public Assistance (Poor Law) Committees of the, County and Borough Councils. Together they have administered, under a needs test, a kind of extended benefit which has been called, for no particular reason, Transitional Payments. That S.O.S. product of the 1931 crisis is now to be wound up. The partnership is to be dissolved and a new department of state, the Unem- ployment Assistance Board, is to be set up, with its own staff, to care for the needs of the Transitional Payment class now numbering about a million. In addition the Board, with its wider scope, will relieve the local authorities of at least 100,000 families now on out-door relief, in so far as such families include an unemployed able-bodied worker over 16 years of age.
The crux of the matter will, of course, be the scale of allowances and the new interpretation of the needs test For knowledge on these vital points we must await the Regulations which the Board will frame and the Minister of Labour will present to Parliament. What the Bill lays down is that the payments will be subject to no upper limit, that they will normally be in cash and that they must meet all the needs of an applicant and his family, other than medical needs. Persons in receipt of wages or benefit, who can still show a margin of need, will have the right to apply for supple- mentary help from the Board. The burden of large families or high rents will doubtless be the main ground for such applications, but there seems no reason why they should not become a regular practice, seeing that no kind of stigma or deterrent, except the ascertainment of need, will attach to the allowances, which will be paid out, like benefit, at the Exchanges. Moreover, in all the business of assessment, certain kinds of family resources are to be ignored, either wholly or in part. The list already includes sick pay, maternity benefit, disability pensions, workmen's compensation, invested savings up to £300 and house ownership, and it is not the fault of private members of Parliament that the list is not considerably longer. Finally, a more generous policy is indicated as regards that most baffling problem of relief : how much of the earnings and resources of other members of the household ought to be taken into reckoning ?
Local Appeals Tribunals are to deal with grievances against assessments and with troublesome or ill-equipped clients for whom the Board's officers prescribe some special treatment. Attendance at work centres may be required and, in the last resort, the tribunals, which will- clearly loom large in the local administration, can send applicants to the workhouse or expel them from the scheme. Expulsion will be a particularly delicate matter, since it will commonly lead to a consequential charge on the local rates for poor law relief.
The real question about this Bill, in all its parts, is whether it will work. Certainly it will put an enormous strain upon administration. About its good intentions there can be no question at all.. Certainly no other country is ahead of Britain in this great matter. Germany has a comparable system of insurance, but her average benefits are smaller and her relief more restricted. And in the United States the prevailing method may be described as a mixture of private charity and extem- porized poor -relief. Even without the new Bill Britain provides more thoroughly and on the whole more generously for her workless citizens than any other country in -the world, and now her standards are to be further advanced.
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