THE WAR AND FAMILY ALLOWANCES
By EVA M. HUBBACK
PERHAPS the most acute of all problems on the home front is how to maintain the standard of living of the people, threatened—as Sir John Simon, Mr. Keynes and others have shown it to be—through the application of so large a proportion of the community's resources to the satis- faction of war needs. All those concerned—the Govern- ment, employers' federations and the T.U.C.—fear the familiar vicious spiral of high prices being followed by high money wages in a vain attempt to enable the wage-earner to live at the same standard as heretofore.
Another problem which—though far more limited in scope than the first—has, both in Parliament and in the country, roused really strong feeling is the question of the allowances to be paid on behalf of the children of soldiers, of civilian disabled men, and of evacuees. The astounding discrepancies in the sums proposed for different categories of children of parents dealt with by various authorities— ranging as they do (in the case of several children in a family) from the average of 3s. for the child of the unem- ployed man on standard benefit, or 3s. 7d. for the soldier's child, to the 6s. 9d. per week allowed for the income-tax children's rebate, and the 8s. 6d. allowed for the evacuee child—have proved that the sums proposed have been deter- mined with little relevance to any scientifically-determined minimum of child maintenance, and in every case, except the last two, are definitely below any such estimate.
A third problem arises from the realisation in the recep- tion areas of the low standard of nurture of many of the child evacuees. To some extent this could, perhaps, be attributed to careless or ignorant motherhood ; but the low level of wages in many unskilled industries, and the effect of under-employment in others usually better remunerated, are proof that in the main it is due to poverty. In every Social Survey made since the war, it has been found that the proportion of children living below the poverty-line is considerably greater than the proportion of adults. The Merseyside Survey showed that out of 6,78o families selected by random sample from the working-class popula- tion of four great boroughs, only 16 per cent. of the families, but nearly 25 per cent. of the children, were living in primary poverty. In the Bristol Survey (1937) again it was shown that " one working-class child in every five comes from a home where income is inadequate to provide a bare minimum standard." A further inquiry in 1937, in West Sussex, showed that 72 per cent. of children in the rural districts surveyed lived in homes where the food expendi- ture was below the minimum recognised by the British Medical Association as necessary for the maintenance of health. If even in peace-time in one of the richest countries of the world so large a proportion of the children were badly clothed, housed and fed, the question arises, " Can child- welfare be safeguarded, so far as subsistence goes, under the threat to the standard of living which has arisen during the war?"
There appears little doubt that the present difficulties are mainly due to the present system, by which children are provided for, after a.fashion, out of the share of the national income accruing to the chief wage-earning parent, a share which is no larger in the case of a father of ten than it is in the case of a bachelor. They have no recognised place of their own in the economic system.
This is a comparatively recent problem, due to the advent of compulsory education and the prohibition of child labour.
Two generations ago, in a working-class household at any rate, children became economically self-supporting at a very early age. Now, whatever class of the community is con- sidered—whether schoolmaster or docker, clergyman or miner—the advent of a new child necessitates a drop in the standard of living of the parents and of any existing children. But it is, of course, on the ranks of the wage-earning popu- lation that the sharpest edge of poverty falls.
What is to be done? Even in peace-time, an increase of wages sufficient to give to every parent of dependent children the means to maintain a large family was recognised to be an arithmetical absurdity. In war-time, the problem is recognised as being even more acute, and it is realised both that the nation's resources must be used to the best advan- tage and that the next generation must, if humanly possible, be safeguarded.
Cannot all these problems—that of maintaining an ade- quate standard of living for all children and of effecting uniformity and adequacy in the allowances already made to the considerable proportion of the children now supported by the State—be solved by the establishment of family allowances—that is to say, by direct provision for children outside the wages system?
Once the principle is conceded, the question arises as to how any such scheme is to be financed. Three suggestions have so far held the field: first, that the principle already admitted in the case of soldiers' children should be extended, and the whole amount be raised by the Exchequer out of taxation ; secondly, that the scheme should be made part of the social insurance system in this country and the cost thus divided between State, employers and workers ; thirdly, that, as in France and Belgium, the cost should fall on industry by the establishment of employers' equalisation pools for a particular industry for a particular locality. The first of these has the merit of simplicity and of universality. The expense would vary, needless to say, with the number of children involved and the rates fixed. The cost of an allowance of 5s. for every child in England and Wales up to the age of fifteen in all families included in the National Health Insurance scheme would be approximately £71 million. If only the second and subsequent children in these families received such an allowance, the cost would be about £34 million.
To raise the first of these sums by three-party social in- surance, equal contributions would be necessary of is. id. from the State, the workers and the employers in respect of each adult workman, and 6d. in respect of each woman worker and juvenile. These contributions would be 61d. and 3d. respectively if only the second and sub- sequent children were covered by the allowances. If only 3s. were given per child the contribution required from the State under an insurance scheme would be L7 million.
Industrial pools schemes have worked extremely well in France, where they have been built up over many decades and are now compulsory. But in view of the fact that the cost is usually shifted on to the workers themselves, it is unlikely that such a scheme would have any chance of support from our trade unions. Moreover if, as in France, it were introduced on a voluntary basis, it would raise even stronger objections and would take far longer to establish.
In estimating the net cost, whatever system is introduced, a very considerable reduction must be made on account of the allowances already paid by the State to the children of men in the Army, Navy and Air Force, to those of civilian and service widows, of men and women supported by the unemployment funds and on public assistance, and of evacuee children who are not supported by their parents.
It must be remembered also that, in addition to the solution of the problems of poverty referred to here, appro- priate family allowances schemes will also solve other social and economic problems—such as the overlap between un- employment benefit and wages for those with several children ; the differentiation between men's and women's wages for the same work on the ground that men mostly have children to support and women mostly have not ; and the low birth-rate to the extent to which this is due to economic causes.
It must also be remembered that family allowances are no longer in the experimental stage. France, Belgium, Aus- tralia, New Zealand, Italy, Germany and many other countries have established larger or smaller schemes as the case may be. In this country opinion is rapidly mobilising in their support. It is true that a section of trade-union opinion fears that the establishment of family allowances may have a deleterious effect on wages, and may, for example, absorb all that might otherwise be spread in a flat-rate wage increase, or even lead to a decrease in the total wages bill. There is no space to argue this at length, except to point out that wages at present bear little relation to the cost of rearing a family, but are determined by the productivity of the industry concerned, and the bargaining strength of the workers. Some of the trade unions feel that the security accorded to their children by family allow- ances would not lessen but would undoubtedly increase their bargaining strength. In all the democracies where they have been established they have the undoubted support of the Labour organisations.
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