THE COAL CRISIS AND FAMILY ALLOWANCES
" Irrespective of the level of wages, we regard the introduction of a system of children's allowances—to be paid for out of a single pool, either for the whole industry or for each district that adopts it—as one of the most valuable measures that can be adopted for adding to the well-being and contentment of the mining population. if the total sum available for workers' remuneration can be kept at the present level, the allocation of a small part of this to children's allowances will raise materially the general level of comfort."
THISpassage, taken from the 'conclusions reached by the Coal Commission on the subject of wages in the mining industry has suddenly taken the question of family allowances out of the theoretical stage, and has made it an important factor in our paramount national problem. A system of family allowances is one in which an allowance, over and above the rate of wages paid to single men, is paid to all married men having one or more dependent child, in respect of each child. Some such system as this is actually in force in several countries of Europe, in one or other of- their industries, and is most frequent in the mining industry. The principal advocate of the system in this country is Miss Eleanor Rathbone. Her book, The Disinherited Family (Arnold, 7s. 6d.), is by far the best and most com- plete account of the whole subject, and her evidence before the Coal Commission applied the system to the mining industry in this country. An institution called " The Family Endowment Society " (24 Tufton Street, S.W. 1) has now been established and issues literature from time to time. Put very briefly the case for family endowment is this. Politicians and parties who wrangle about the proportion of the national income which can, or should, be devoted to the payment of wages often overlook the possibility that a redistribution, according to needs, of the present amount paid out in wages would immensely raise the general standard of life. The workers are demanding " a living wage." By this ex- pression is usually meant a wage that will satisfy the basic needs of a family of two adults and three dependent children (since such a family is regarded as the " average "). But in fact, only 6.2 per cent. of the male wage-earners of this country have such a family. 6.7 per cent. have more dependants, and all the rest have less. Therefore ", a living wage " paid to the adult male workers and based on the family of five would 'provide for millions of wives and children who do not exist, and leave many hundreds of thousands of actual women and children unprovided for. As Miss Rathbone puts it, " A national minimum " or " a living wage " based upon the needs of a five-member family would mean provision for over 16,000,000 phantom children and inadequate provision for over half the real children for over a third of their childhood. Or, as Sir William Beveridge wrote in a review of her book :- " To assume a ' normal family' at the basis of wage policy is about as sensible as to base housing policy on the assumption that all the thirty-five million inhabitants of England live at Coventry (as its geographical centre), or to suppose that if three members of a walking party need shoes of number 10 size and three others • need number 8's, all six will walk in comfort if they are given number 9's."
But if the present amount paid out in wages were spread out thin, as it were, according to the real needs of the various families, real destitution could be abolished without any political changes. This is the prima facie case for family allowances. The first objection which occurs to one is, of course, that married men will be penal- ized in the .struggle for employment, since, if it is com- pulsory to pay them an allowance on top of their basic wage rate, their labour becomes more expensive than that of single men. Miss Rathbone tells us that there are three ways out of this difficulty :- "First; it could be met by a national system of Child Endowment, paid for out of taxation.. It is estimated that to pay a weekly
allowance of 6s. for every child under 14 in Great Britain would cost roughly £170 million per annum—a vast sum, which seems, however, less staggering when we remember that the children are being maintained now—after a fashion—and that to maintain theta with more efficiency and less waste might not in the long rim be a WO investment, even from the financial point of view.
Secondly ; it could be met by an extension of the system of Compulsory Contributory Insurance. Just as we make provision for unemployment and for sickness, so the State, the Employer, and the Worker might each be required to pay a certain weekly sum into a central fund, out of which allowances would be paid to the mothers for each child of a worker up to a stated ago (say 14 or 16). Thirdly ; there is another alternative which has been introduced since the War in many Continental countries, and has spread with amazing rapidity. This is the system of paying allowances for dependent children of wage earners out of a pool or fund formed by contributions from employers, who band themselves into Associations for the purpose. The contribution levied on each employer is usually based either on the total amount of his wage bill, or on the total number of his employees, whether married or single. In neither case has he any inducement to discriminate against men with dependents, as the cost of maintaining the latter is spread out thin over the whole Association."
. Miss Rathbone, in her evidence, pointed out several reasons which indicate that the Coal industry is especially suitable for family allowances. These were as follows :- "(i.) The industry is self-contained, i.e., its workers are usually recruited in youth and remain in it throughout their working lives. This lessens the danger that married workers might flock into the industry from outside for the sake of family allowances.
(ii.) The industry is highly organized on both aides, on a national as well as a local basis. This would facilitate the framing and administering of a scheme both acceptable to employers and workers. (iii.) The calculations of product and productivity on a mathe- matical basis are familiar to the industry. This would make available methods of levying a fund out of which family allowances could be paid. For example, the basis might be a payment on tonnage of coal raised, as in the case of the existing Welfare Fund.
(iv.) The difficulty of paying a living wage without overburdening the industry is acknowledged by both sides. This should render both more willing to consider a system, oven if new, which offers a practicable method of escape from the difficulty."
Several other objections are made to family allowances. One is that they would tend to raise the birth rate unduly. To this Miss Rathbone replies that economic well-being can be shown statistically to be the condition of family limitation, so that any proposals, such as hers, which would raise the general standard of life could not unduly raise the birth rate. Then there is the difficulty of reconciling the system with the encouragement of piece work and our theories of free contract for work and reward ; it would create a kind of " two children" or " three children status."
But whatever we think of these proposals it certainly behoves us all to study them, and we have always felt that the trades unions' insistence on national standard wages where they can get them works out hardly for the wage-earner when compared with the salaried classes whose reward generally rises roughly with increasing age and probable family responsibilities.
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