PUBLIC ASSISTANCE AND ITS COST. [Commurac.arEn.] G REAT BRITAIN'S financial straits
have compelled attention to the immense increase of expen- diture on direct public assistance in recent years. Direct public assistance comprises all beneficiary assist- ance from rates and taxes, whether maintenance or treatment, for which the recipient does not pay or only pays a portion. It is dispensed by different and un- connected Public Departments, such as the Ministry of Health on its Housing, Public Health, Poor Law, and National Health Insurance sides ; the Board of Customs for Old-Age Pensions ; the Education Department, including Provision of Megis Act; the Ministry of Pensions, and the Ministry of Labour. These Departments have separate administrative areas, sub-areas, and separate inspectoral districts. There is no .central administrative control and, as a rule, no common or concerted action locally. Moreover, it is not possible to form an accurate idea of the total amount spent in direct public assistance in any one year, or to form any estimate of the amount which will be required for the following year, nor is it possible to devise any common policy to promote efficiency and eliminate overlapping and waste.
England is the classic land of Public Assistance, and the foundation of the present system was laid in 1601 by the famous Statute of the 43rd year of Elizabeth's reign, under which a compulsory assessment was made for the relief of the impotent and the setting of the able-bodied to work. During the Middle Ages the poorer classes depended on the Feudal Chiefs and the Church. As the Feudal System decayed the poor fell back on the ecclesi- astical foundationsi and, in the oft-quoted words of Puller, "the abbeys dispensed mistaken charity promiscuously, entertaining some who did and many who did not deserve it. Yea, these abbeys did but support the poor whom they themselves had made." Substitute Parliament for the abbeys and you have a not unfair picture of a great section of the Public Assistance of to-day. But we must not anticipate. From 1601 to 1884 the Elizabethan Poor Law, with modifications, held sway (and, indeed, the original Act is unrepealed). In this epoch there regularly occurred periods in which motives of sentiment led to in.
tolerable extravagances in administration, and these were as regularly replaced by more scientific methods under the remorseless pressure of financial difficulties. The last period of extravagance began in 1783 and ended in 1884, when the expenditure in some cases swallowed up the whole of the annual rateable value of the land and reduced the nation to the verge of bankruptcy, leaving the population in a state of complete demoralization. In twenty years from 1783 the Poor Law expenditure had more than doubled itself, and in 1817 it had reached the enormous total of £7,000,000 for a population of 11,000,000. In 1832 the direct burden, according to a Parliamentary Return, amounted to £7,-000,000, and the waste from the Labour rate and roondsnum system of employment was estimated at another £7,000,000, or £14,000,000 in all.
The Commission of Inquiry and Control in 1884 started from the principle that the condition of the recipient of public relief should be less eligible than that of the inde- pendent labourer of the lowest class who has to bear the charge, and worked out with such efficiency that in 1871, with a population of 22,000,000, the cost was almost exactly the same as in 1817 with a population of 11,000,000 (17,000;000). These figures are for England and Wales. In the meanwhile, the working classes had not only recovered their self-respect, but had, by self-help, in their Trade Unions, Friendly Societies, Co-operative Societies, and Building Societies, made provision for (1) sickness, accident, and old age and the settlement of disputes ; (2) for the acquisition, not only of the necessaries of life at cost price, but also (8) of their own houses. At the end of the century a competent authority estimated the wealth of the working classes in these forms of association and their own savings at not less than £300,000,000 sterling. This healthy development was interrupted by the politicians, who saw political capital to be made by relaxing the sound policy of 1834 and introducing State .grants for all kinds of public -assistance. The new views came strongly to the fore at the beginning of the century and led the way from economic independence back to social servitude. In quick succession we had the Unemployed Workman Act (1905), the Children's Provision of Meals Act (1906), the Old-Age Pensions Act (1908), and in 1911 the system of National Health Insurance with its famous offer of 9d. for 4d. This was followed by the Labour Exchange Act and the Unemployment Insurance Act. In 1912 it became evident that these Acts, and later War Pensions, were overlapping with the Poor Law, and that the exact cost and the number. of the beneficiaries were unknown. Before any reform was possible public returns were required to show where were the waste and ineffici- ency it was necessary to eliminate. In 1918, with the help of friends on both sides of Parliament, and later with the help of the Denison House Committee on Public Assistance, I obtained returns which, with Parliamentary statements, show the following results :—Expenditure from the rates and taxes on Public Assistance : 1890, £25,000,000, including Education £12,500,000; 1900, £39,000,000; 1910, £69,000,000; 1919, £173,000,000; 1920, /832,000,000, including £99,000,000 for War Pensions * and 172,000,000 for Education ; 1921,
*A form of relief which must be distinguished from other forma. in that it is hi the nature of a reward for services rendered.
£400,000,000 (Hansard, April 4th, 1922). These figures are for the United Kingdom.
In fact, the position is that all told the poorer classes would seem to be receiving in what used to be known as relief at least £225,000,000 in place of £11,500,000 in 1890, and this is not all, for, as an expert points out, various Departments are this year anticipating orders they would give in labour for expediting work or buying stores for stock, &c., in later years, and railways and other great commercial undertakings are doing the same so far as they are able. These orders cannot, therefore, form part of the ordinary work available in future years. The result of the present position is appalling, and affects not only the solvency of the central and local governments, but the standing of our commercial system and its power of competition in the world market. A public inquiry at Sheffield has shown that the result of the present poor rate alone on the production of steel tyres is equal to a tax of 18s. 11d, per ton as against 6d. per ton in 1914, an increase of 3,683 per cent., and on steel axles an increase of 6,167 per cent., that is from 51d. per ton to II. 7s. 5d. per ton. Moreover, the overlapping of the central depart- ments and the want of common action locally produce disastrous results. The Board of Customs administering Old-Age Pensions, the Ministry of Labour with its Labour Exchanges and Unemployment Insurance, and the Pensions Ministry are all overlapping with the Ministry of Health on its Poor Law, National Health Insurance and Public Health sides. Locally, there is the same want of concerted action, and locally, too, we have different standards of administrative cost and different views as to ithe need of inquiries into means before assistance is .granted. A recent inquiry has shown that in one Poor Law Union alone about £100,000 could be saved annually by administrative reform. But the first thing required is an accurate knowledge of the facts. The Denison House Committee on Public Assistance have therefore decided to appeal to the Prime Minister who, as Chancellor of the Exchequer, showed his appreciation of the need of accurate knowledge in 1918 by granting an extension of the Return of expenditure from the rates and taxes on direct public assistance as above defined, commonly known as the Drage Return.
They are asking (1) for a complete and up-to-date Return of all expenditure on direct public assistance from the rates and taxes, including details as to administrative cost. For instance, the cost of the Labour Department and its policy should be given in the Return.
(2) For a register of the beneficiaries, so that the amount received by units and by families should be made known.
(3) An annual estimate of future expenditure on direct public assistance, the necessity for which every business man will understand.
• (4) A permanent Commission of Inquiry and Control to decide whether some more economical and efficient form of administration cannot be devised for the central and local administration of public assistance. Here there will, of course, be great opposition to encounter. All these "Departments maintain at great cost to the State a system which overlaps without any common or concerted action. But their influence, great as it is, will be nothing compared with the vested interest of the local bureau- cracies and the beneficiaries, and to such influences Parliament has shown itself unusually amenable in - recent sessions.
A great effort is needed to bring about the necessary moral regeneration as well as to avoid central and local bankruptcy. We are appealing to the Prime Minister to follow the precedent of 1834. The Editor of the Spectator has promised to sign our Petition. Will the readers of
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