LETTERS TO THE EDITOR.

THE GOVERNMENT INSURANCE BILL.

[To TES EDITOR OP THE SPECTATOR."]

Sin,,—The attractive points of Mr. Lloyd George's proposals are obvious, and have been made sufficiently prominent by the Press and by public speakers. Everybody wants everybody else to be well cared for in sickness and to be spared avoidable distress in unavoidable unemployment—and we are all prone to welcome a measure which promises so much in both these eases. All the more is it necessary to make sure that the plan is a sound one, and that there are not less obvious dangers and difficulties, immediate and remote, involved in it. It is to be hoped that you will give ample opportunities for discus- sion of a subject of such importance.

(A.) Insufficiency of the Scheme.—It will scarcely touch many of those, the hardness of whose lot forms the founda- tion of the case for State action. The small worker for no master, the casual worker, the migratory worker, will all, male or female, be more or less outside a system whose essence is regular payment, regularly supplemented by employers' contributions. The opportunity of joining volun- tarily is not likely to be often embraced by such as these; although, no doubt, the " voluntary" clauses will reach others.

(m) Inequality.—The "employed contributor" earning 10s. a week is to make the same weekly payment as he who earns, say, R3* (yet the alternative of graded payments is scarcely practicable). Inequality of conditions coupled with equality of contributions cannot be satisfactory in the absence of inequality of benefit ; not to mention special difficulties in cases of variable remuneration, such as seasonal trades. It may here be noted that the Social Democratic Party have already declared emphatically against any contributions whatever by workmen.

(c.) Injustice.—(1) The healthy and the efficient will go on paying without receiving ; the weakly and the inefficient will draw the proceeds. (2) Women, apparently, can only pay or claim while unmarried. This means that in many cases only during their days of youth, and presumably of validity, they are to pay, with little likelihood of receiving, while during marriage their previous payments will avail them nothing.

(D.) Special Difficulties as to Malingering.—It is notorious that even the Friendly Society members, who are superior men, joining voluntarily, only admitted before middle life after medical examination, and subject to constant super- vision by club doctors and sick-visitors, have to be bound by stringent rules and careful watching if malingering is to be avoided; but malingering for sick-pay is far less seductive and more easily detected than simulated unemployment. Germany is said to know something about these things.

(E.) Doctors.—It is difficult to believe that the remuneration offered will attract and retain the services of men competent to perform duties more arduous than those of the Friendly Society medical man.

(r.) The Effect on Friendly Societies.—(1) Section 27 provides that where a man stands to receive benefits both from his Society and under the Act together exceeding the amount of his wages the latter benefit is to be reduced by the amount of such excess. This will, in practice, probably lead him to insure with his Society for a diminished amount, for it is clearly advantageous to take full benefit under the Act, where the contributions are fixed and compulsory, and not to pay contribution to the Society for more benefit than will make up the maximum receivable. This result, how- ever, seems contrary to the intention of the scheme, and can hardly be good for the Societies, who may well lose both in members and money. (2) The amount of work thrown upon the Societies will be very great, and it may be doubted how far the manage. ment committees and officers will be able to perform it, con- sisting, as they do, largely of working men. (3) It is unpleasant even to suggest such a thing, but the history of Friendly

Societies is full of instances of defaulting officials. The multiplication of these posts and the increased sums passing through their hands must involve either more risk of this kind, or elaborate checks entailing increased work. (4) Per- haps it is not regrettable that only the strong Societies should

• Has not Mr. Willink overlooked Schedule II ? survive, but the scheme seems to threaten the well-being of some which at present are sound enough, and their members may well be anxious; e.g., the Hearts of Oak, it has been stated, will find difficulty in adapting their centralized system to the proposed requirements. (5) Whatever may be the intentions of the framers of the Bill, the handling of public money must lead to a growth of State control—and, rightly or wrongly, the independence of the Societies has hitherto been one of their proudest boasts.

(G.) The Effect on Wages.—This includes the effect on em- ployment and on trade generally. Without attempting tit foretell where the burden will eventually rest, there seems to be ground for holding that, more or less gradually, a displace.. ment of some kind will be effected. Large concerns, employ., ing thousands of hands, will not be able to ignore the expenses of contributions to the Insurance Fund. Either they will lower their wages, or they will reduce their staff of employees, or they will raise their prices. The effect of any one of these courses need not be elaborated. One thing is clear, there will be results unfavourable to labour.

(a.) Inexpediency.—Admitting to the full the desirability of improving the conditions of the working man and of the poor, it is open to doubt whether compulsory contributions, supple- mented by external subsidies, will really encourage habits of thrift and providence, at any rate among those difficult classes whose depressed state is the crux of the whole matter. Com- monplace as it may seem to say so, the formation of character is the one thing needed; and doles of money, however dis- guised, have to be very carefully administered if they are not to be fatal to this in the future, as they have repeatedly been in the past. Nor is it easy to see why one particular form of providence should be subsidized more than another.

(a.) National. Finance.—The money for the State subsidies must come from somewhere, and your readers do not need to be reminded that the addition of millions to the annual Budget is a serious affair.

(a.) Politics.—This is, perhaps, the most prominent of all the items, containing, as it does, the germs of so many develop- ments. The prospect of yet another class of appeal to the voter is alarming, and none the less so at a time when we are on the point of entrusting the control of public affairs to one popularly elected Chamber.

In conclusion, the scheme as a whole, however praiseworthy in its object, proposes to treat symptoms rather than causes, and to do so in a dangerous way.—I am, Sir, &c.,