The Treasury and Unemployment N OT nearly enough attention has been
given in the newspapers to the grave and indeed alarming statements which were made last week to the Royal Commission on Unemployment Insurance by Sir Richard Hopkins (the Controller of Finance and Supply Services at the Treasury) and Sir Alfred Watson (the Government Actuary). When compared with the issues which were laid before the Commission by these two witnesses the objects of the Trade Disputes Bill and the Electoral Reform Bill seem of no importance whatever. Mr. Joseph Chamberlain in his Tariff Reform campaign used to say that the country was bleeding to death. He was wrong, or at all events he greatly exaggerated ; but now when there is far better evidence that the country is bleeding to death the calmness of the patient is ominous. If the country is not sufficiently concerned about itself it has not the true spirit of recovery.
It is appalling to learn on the authority of the highest officials that the " stability of the British financial system is in danger of being undermined." What is happening is that huge Treasury loans are becoming in effect a mere borrowing to meet current obligations at the expense of the future. The Treasury estimates that next year it will be required to find well over £50,000,000 to meet its own share of the cost of Unem- ployment Insurance. This, says the Treasury, taken in conjunction with other continuing liabilities of the State, will " entirely- upset the equilibrium of the Budget on the basis of existing taxation." Over and above that danger there is the result of general borrowing. It is thought that next year £40,000,000, and perhaps as much as £50,000,000, will be added to the National Debt. Again, according to the Treasury, the total expenditure on all the Social Services this year, exclusive of War pensions, will be about £193,000,000.
Rumour says, and in this case rumour is no doubt justified, that the Prime Minister and the Chancellor of the Exchequer, and some of their most responsible colleagues, are greatly disturbed by these figures. They no longer attempt to defend a system under which a coal-trimmer, who by working long hours for two or three days can earn as much as from £5 to £7, goes on the " dole " for the rest of the week, or under 'which a young woman who describes herself as a shop= assistant has a regular job for the " week-end " and goes on the " dole " for the rest of the week.
The conditions for drawing unemployment benefit have been relaxed under the pressure of the Trade Unions. But the Prime Minister and the Chancellor of the Exchequer apparently recognize now that though they may have to resist the Trade Unions, there are other enemies whose pressure is much worse. There is Nemesis. An end must be put to the deplorable practice of telling the constituencies that they. have only got to vote in a certain way " to collar the swag." This electoral bargaining in which one candidate is virtually compelled by circumstances to outbid the other candidate, or candidates, has become a source of demoralization, even if it cannot be called rank corruption. It will ruin us all if we cannot stop it.
There will be a glorious chance to remedy a thoroughly bad system if only the Royal Commission should make a recommendation, as we hope it will, for placing the Unemployment Insurance Fund beyond political bar- gaining. Insolvency cannot be indefinitely deferred if Governments go on paying more out of the Exchequer than there is in it. We are sure that people funda- mentally have enough self-respect to keep themselves from shabby tricks if only they are not too flagrantly tempted by faulty administrative rules.
Admittedly there are difficulties in placing the Social Services on neutral territory. No Prime Minister can constitutionally sacrifice his ultimate authority. He says, rightly, that he occupies his position- to interpret the will of the majority which placed him there. There are, however, many conceivable devices by which a crude bargaining about the Social Services could be avoided without calling in question the final authority of the Prime Minister. Mr. Churchill has suggested permanent Economic Sub-Committees as part of the structure of Parliament. These might cause so much devolution of authority that authority would be lost. We ourselves should like to see the experiment tried of referring all expenditure on the Social Services to Com- missioners. If these Commissioners were carefully chosen, and a tradition grew up of paying the utmost respect to their advice, they would be a real shock-absorber between Parliamentary candidates and the con- stituencies.
The candidate instead of saying in a Jack Cade manner, "Return me and I will give you all that you desire," would be reduced to saying " I will do my best if you return me to get you all that you want, but I must warn you that your demands, whatever Party may come into power, will have to go through the very fine sieve of the Commissioners. No Government without the utmost peril to its cause can wantonly disregard those Commissioners. It has been established that there must be a continuity of policy in the Social Services."
If there should be such a happy sequel to the Royal Commission on Unemployment Insurance, the method, or at least the spirit of it, could be applied to many other matters. With a comparatively few strokes there would be a vast relief to the congestion in the House of Commons, since much of it is caused by con- troversy on expenditure.
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