THE INSURANCE BILL MUDDLE.
AS the Insurance Bill proceeds on its way through the House, large masses of it being swallowed without debate or discussion, it is almost impossible to form a clear estimate of what has been done. Each day Mr. Lloyd George announces fresh concessions, which, as far as can be judged, are made without any regard to the general finance of the scheme. The latest series of concessions is with regard to the treatment of women. The Spectator, from the outset, has protested against the shameful injustice to which women as a body were subjected by Mr. Lloyd George's proposals, and we are glad to learn that at the eleventh hour some concessions are to be made to the reasonable claims of women. As the Bill originally stood, all unmarried women were compelled to subscribe to Mr. Lloyd George's fund, and the moment they married they lost all claim upon it except in the event of their being left destitute in widowhood and returning to indus- trial work. Thus this great scheme, which was proclaimed as a measure of social justice, proposed that young factory girls and domestic servants should bear the whole cost of re-insuring married women for whose future no provision had been made either by husband or by friends. How any responsible Minister could ever have put such a proposal on paper it is difficult to understand.
Under pressure Mr. Lloyd George has at last yielded to the extent of accepting the group of amendments put forward by Mr. Lees Smith, which has the effect of con- siderably mitigating the proposed injustice. In the first place it is proposed to permit married women to become voluntary insurers, but on a reduced scale. They are to pay 3d. instead of 6d., and the benefits are to be reduced approximately in proportion. The Government instead of giving the much boasted 2d. gives .only ld. It is further proposed that those women who on marriage do not take up the voluntary insurance should be entitled to a two-thirds surrender value of the insurance to which they have previously been compelled to subscribe. The remaining third is set aside to provide a right of re-entry into the scheme for widows. It is to be noted that even the two-thirds surrender value is not given back in cash, but may be used either as an extra maternity grant or reserved for periods of distress, as, for example, when the woman's husband is out of employment.
These concessions are undoubtedly an improvement, but they still leave the essential injustice to women unremoved. The essence of insurance is that people insure for a risk which they conceivably may incur, and the remoter the risk the smaller the premium they are willing to pay. The essence of Mr. Lloyd George's proposals, even as amended, is that women are compelled willy-nilly to insure against a risk which many of them will never incur at all. A very large number of women never marry, and many married women do not outlive their husbands. Even of those married women who are left widows many do not go back to industrial work. An appreciable number go to live with friends, giving service in return for maintenance. Doubt- less there remain a very large number of widows who do have to earn their own living, and who certainly need such assistance as the benefits proposed by the Insurance Bill may give them. The whole question is whether it is right that these women should draw their support mainly from young servants and young factory girls. It seems to us that if these women are to receive charitable support it ought to be drawn, as the Socialists are saying, from the whole community. If, on the other hand, the support they receive is to be based on the principles of insurance they ought to be allowed to continue throughout their married life insurance on the same terms as those imposed upon them when single. The proposals put forward by Mr. Lloyd George illustrate the way in which, directly a compromise is made between business and charity, injus- tice is certain to result.
The same fact is illustrated in an even more striking manner by the treatment of the Post Office depositors. In most of the speeches which Mr. Lloyd George has delivered he has metaphorically wept over the sufferings of the poor and proclaimed that his measure was going to bring them relief. As a matter of fact the real poor get practically no benefit at all out of his scheme. The persons who will profit are the relatively well-to-do mem- bers of friendly societies, who have already made provision for themselves, and who are to receive a re-insurance partly at the expense of the taxpayer, partly at the ex- pense of the very poorest classes of the community. Those who are rejected by an ordinary friendly society, and who consequently are probably most in need of assistance, get practically no insurance at all. They merely receive a small State subsidy in addition to their own compulsory con- tributions; and as soon as what they have paid in is exhausted they have no further claim upon the fund. They will then have to fall back upon the Poor Law, which they could do at present without being put to the expense of paying 4d. a week to the National Insurance Fund. In the course of the debates in the House of Commons this week the proposal was attacked by members of such different schools of thought as Mr. Sherwell and Mr. George Lansbury. Both argued, as Mr. Sidney Webb has argued elsewhere, that for this residuum of uninsurable persons it was far more important that the community should spend money in improving the general health conditions of the population, and especially of its young members, than that it should provide an inadequate fund out of which to pay people while they are sick. Mr. Lloyd George so far admitted the solidity of their criticisms that he accepted Mr. Sherwell's amendment to limit the operation of the clause to three years. He characteristically tried to cover up his retreat by a violent attack upon the Unionist Party for venturing to criticise his Bill.
The progress of the debate, inadequate though it is, shows how serious a blunder Mr. Lloyd George has made in copying the German sickness insurance without waiting to learn what its effects have been. Some of these are brought out in an admirable little pamphlet by Dr. C. S. Loch (" The National Insurance Bill," published by the Charity Organization Society, 296 Vauxhall Bridge Road, London, S.W. ; 4d.) He shows that between the years 1900 and 1909, while the population of Germany increased 15 per cent., the days of sickness in the insurance funds increased 59 per cent. and the expenditure 95 per cent. It is true that between these two dates alterations were made in. the law which permitted a certain extension of the days of sickness, and, therefore, to get a more accurate per- centage he takes the years 1905 and 1909. In that period the German population increased by 7 per cent., the days of sickness by 17 per cent., and the expenditure out of the sick funds by 32 per cent. These figures clearly demon- strate that, if you pay people to be sick, sickness will increase. Put in terms of the totals instead of per- centages, the cost of sickness insurance in Germany rose from £8,579,000 in 1900 to £12,692,000 in 1905, and to £16,728,030 in 1909. In view of this experience it is extraordinary that any Chancellor of the Exchequer should be forcing such a Bill as this through the House of Commons without giving that body, which is still nominally responsible for the finances of the country, an opportunity for considering the full financial effect of the scheme. Only this week an admission was made by the new Secretary to the Treasury, which is most significant. The Government actuaries, when the scheme was first presented, calculated that in order to enable middle-aged and old persons to come into the scheme at the same rate of premium as young people a debt of £63,000,000 would be incurred. To wipe off this debt it was proposed that for 151 years certain deductions should be made from the premiums payable. At the end of the 151 years the revenue thus obtained would be set free for paying higher benefits. This was the argument used by Mr. Lloyd George to reconcile the younger con- tributors to the gross injustice of compelling them to pay at the same rate as people twice or three times their age. Mr. McKinnon Wood now admits that the various con- cessions made with regard to maternity benefit, sanatorium benefit, and so on, have upset the calculation, and that the periol of 151 years will not suffice to pay off the debt with which the scheme is loaded. Nor is the Government yet in a position to say what period will suffice. If such a scheme had been put forward by some irresponsible member below the gangway no great harm would have been done. The scheme would have been laughed out of court. The extraordinary thing is that this scheme, with its reckless finance, is put forward by the responsible Finance Minister of the country.
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