TOPICS OF THE DAY.
THE NATIONAL INSURANCE SCHEME. THE Chancellor of the Exchequer's scheme is so attrac- tive that it is difficult to keep one's head in regard to it. Consider what it promises. Every working man and woman in the country are to be insured against the evils of sickness, and, ultimately, of unemployment—those grim nightmares which haunt the homes of the poor. Every household in the land is to be raised by the beneficent operation of the State to the position which the best and most self-respecting have already reached by their own efforts. The poor are to be organised so as to stand out- side the worst evils of destitution, or, at any rate, outside the evils which flow from adverse fortune and not from vice. When a man, or a party, in the State offers so much and attempts to relieve humanity of so great a burden, one's first impulse is to withhold all criticism. Nothing, one feels, should be done which may even have the appear- ance of interfering with so noble a work. All we ought to do is to stand aside and bid him, and them, do their best in God's name. Yet such an attitude of unreasoning optimism would, in truth, be very foolish and very injurious. It is essential that the country should keep a cool judgment in the face of what seems a cataract of universal comfort, and insist that it will not be swept away in a delirium of enthusiasm. If the torrent is not controlled and kept within bounds, it may in the end do more harm than good. As every owner of a water meadow knows, irrigation, though good in itself, can easily be overdone. A. man's fields may be ruined instead of rendered fruitful by an ill- spent flood. A good insurance scheme, even though it may not wholly change the face of the world and of human nature, may do much. One badly planned, or wasteful of the national resources, may do far more harm than good.
With so much apology, we will try to set forth an outline of the Chancellor of the Exchequer's scheme. In the first place, it is divided into two parts—insurance against sickness, and insurance against unemployment. The scheme for sick benefits begins with free medical relief and free drugs for all persons insured. Next, the weekly allowance for the first three months of sickness is to be 10s. for men and 78.6d. for women. For the subsequent three months there is to be an allowance of 5s. for both sexes. In the case of permanent disablement through sick- ness, 55. is to be paid. weekly to men and women alike. In addition, consumption sanatoria are to be established throughout the country and a maternity grant of 30s. is to be given to all mothers. Who are to enjoy those benefits ? Speaking generally, all workers with incomes under the limit of the income-tax taxation—that is, £160 a year. The scheme, however, is not to include married women unless they are workers. The number of persons to be thus insured is calculated at 14,700,000. Those who are to be exempted from the scheme are soldiers and sailors (special provision is to be made for them later), teachers, persons in Government and municipal employment, commission agents, and casual labourers. The age beyond which admission to the bene- fits of the scheme cannot be gained is placed at sixty-five. The age at which admission to the scheme begins is six- teen. It is to be noted that the obtaining of allowances is to be dependent on patients obeying the doctors' orders.
The manner in which the scheme is to be applied is roughly as follows : Speaking generally, the male worker is to be compelled to pay 4d. a week out of his wages to the Insurance fund, and the woman worker 3d. The employer in both cases is to pay 3d. a week, and the State 2d. The payments of the worker and the employer are to be made by means of stamps attached to a card, and paid in to the Post Office. Special arrange- ments are to be made for men who work on their own. In the case of men working at low wages the rate of payment is to be less and the benefit less. A man who earns 2s. 6d. a day will pay 3d. instead of 4d., one with only 2s. a day or less, 2d. a week, and the man earning is. 6d. a day only Id. a, week. In these cases, however, compensation to the fund will be made by extra payments from the employers who are supposed to profit by cheap labour. That, we may say in passing, seems to us a very doubtful, if not dangerous, arrangement, for it assumes what is contrary to all fact—namely, that employers who use the cheaply remunerated types of labour are thereby in an easy financial position. As a matter of fact, experience shows that it is the small and poor, not the rich, employer who makes use of the lowest types of labour. To treat him as a man who has a larger margin of profit is absurd. The method by which the money is to be distributed is difficult to explain shortly. As far as possible, approved Friendly Societies are to be used.
Unemployment insurance, though as far as it goes it is to be compulsory, is, to begin with, to affect only two trades—those of engineering and building. In this case the workmen are to pay 21d. a week and the employer 21d., while the State is to contribute a quarter of the cost. The unemployed allowance is to be 7s. a week for fifteen weeks, but there is to be no payment for the first week's unemployment, and no unemployed pay is to be given through strikes or lock-outs, or in cases where a man has been dismissed for misconduct. This last provision seems to promise a fruitful crop of disputes as to what is mis- conduct and what is harshness or oppression on the part of the employer. Labour exchanges are to provide the machinery for the scheme, and Trade Unions are to claim. payment for unemployed benefits paid by them. The unemployed insurance scheme will, it is estimated, affect 2,400,000 men. Thus the total of persons affected by the Bill will be something like 17 millions.
Two questions must always be asked in regard to any scheme of State action, however beneficial. The first is—What will it cost ? And the second : Where is the money to come from ? In the present case we are told that the cost to the State of insurance against sickness when it is in full working order will be over 41 millions a year, while the State contribution to the unemployed scheme will be £750,000—that is, a total cost of nearly 51 millions. Mr. Asquith in introducing the Old Age Pensions Bill declared that the maximum cost would be 6 millions a year. We ventured to say that it would turn out to be 12 millions. In reality, as the Chancellor of the Exchequer acknow- ledged on Thursday night, it is already 13 millions a year, and is rising. On the present occasion we predict that when both schemes are in full working they cannot cost less than 10 millions a. year as regards the Government contribution. But another 10 millions a year cannot be raised from the already overburdened taxpayer without very considerable evils following in its train. We do not say that these sacrifices will be necessarily so great as to forbid the scheme, but, at any rate, they involve evils which must be faced. The notion that money can be taken out of the tarpapers' pockets without anybody suffering is one that no sane man can hold.
In addition to the evils which must come from the great and new burden assumed by the State, there are one or two other obstacles to the scheme worth consideration. To some extent the sickness scheme, and even the unemploy- ment scheme itself, will increase unemployment. In the first place, the employer, who will have such large payments to make, will be inclined to reduce his labour list and eliminate from it all unnecessary persons. He will be specially inclined to do this in the case of trades insured against unemployment, for he will not have the feeling that the men knocked off the wages sheet will be sent to starve. Next, the scheme will tend to reduce wages, or, at any rate, to prevent them from rising. Lord Furness, the Daily Mail tells us, has already stated that in the case of one of his firms the employer's contribution will amount to £166 a week. Unless the business is far more elastic, and has a far greater margin of profit than most businesses, we may be sure that in such cases an effort will be made towards economising, and the easiest, perhaps the only place in which such economy can be made will be the wages bill. Finally, the tremendous problem of malingering must be faced. It is a difficult business at present, but it will be much greater when men feel that by pretending to be ill, or, if you will, giving way unduly to illness, they are not robbing their societies, but merely dipping into what seems to them the illimitable pocket of the nation. Allied with this is what might be called unemployment malingering. We all know men of whom it may be said that if it were to rain " jobs " from Heaven their heads are of such a shape that not one would be found to fit them. We shall be lucky if the scheme does not stimulate the development of this class, and on a, huge scale.
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