ill THE PEOPLE'S INSURANCE THE PEOPLE'S INSURANCE Explained by THIS CHANCELLOR OF THE EXCHEQUER THE RIGHT HON. DAVID LLOYD GEORGE, P.C., D.C.L., LL.D. (Wales), M.P. THIRD EDITION, CONTAINING THE TEXT OF THE NATIONAL INSURANCE ACT (1911), TOGETHER WITH EXPLANATIONS OF THE INSURANCE COMMISSIONERS LONDON, NEW YORK, AND TORONTO HODDER AND STOUGHTON 1912 RICHARD CLAY AND SONS, LIMITKD, BRUNSWICK STREET, STAMFORD STREET, S.E., AND BUNGAY, SUFFOLK. CONTENTS PART I PAGB THE REASONS FOR NATIONAL INSURANCE AND AN OUTLINE OF THE BILL AS INTRODUCED ........... 3 PART II SCOPE OF THE INSURANCE SCHEMES ....... 35 (a) INSURANCE AGAINST SICKNESS. (b) INSURANCE AGAINST UNEMPLOYMENT. PART III TEXT OF THE NATIONAL INSURANCE ACT, WITH SCHEDULES ... 67 PART IV IN DEFENCE OF THE MEASURE . .175 PART V DOUBTS AND DIFFICULTIES REMOVED 229 PART VI THE MACHINERY OF THE ACT . . . . . . . . -239 INDEX .... . ... 297 THE REASONS FOR NATIONAL INSURANCE AND AN OUTLINE OF THE BILL AS INTRODUCED '( From the Speech of the Right Hon. D. Lloyd George on introducing the Bill in the House of Commons ', May 4, 1911 This speech and the following Memoranda refer to the original Bill, and need to be read now in the light of the actual text of the Act as given in subsequent pages. PART I THE REASONS FOR NATIONAL INSURANCE AND AN OUTLINE OF THE BILL AS INTRODUCED I think it must be a relief to the Members of the House of Commons to turn from controversial questions for a moment to a question which, at any rate, has never been the subject of con- troversy between the parties in the State. I believe there is a general agreement as to the evil which has to be remedied. There is a general agreement as to its urgency, and I think I can go beyond that and say there is a general agreement as to the main proposals upon which the remedy ought to be based. Thirty per cent, of Pauperism attributable to Sickness In this country, as my right hon. friend the President of the Local Government Board (Mr. Burns) said in his speech last week, 30 per cent, of the pauperism is attributable to sick- ness. A considerable percentage would probably have to be added to that for unemployment. The adminis- tration of the Old Age Pensions Act has revealed the fact there is a mass of poverty and destitution in this coun- try which is too proud to wear the badge of pauperism, and* which de- clines to pin that badge to its children. They would rather suffer from priva- tion than do so. I am perfectly cer- tain if this is the fact with regard to persons of seventy years of age, there must be a multitude of people of that kind before they reach that age. The Present Insurance and the Working Classes The efforts made by the working classes to insure against the troubles of life indicate they are fully alive to the need of some provision being made. There are three contingencies against which they insure death, sickness, and unemployment. Taking them in the order of urgency which the working classes attach to them, death would come first. Against Death There are 42,000,000 industrial policies of insurance against death is- sued in this country of small amounts where the payments are weekly, monthly, or occasionally quarterly. The friendly societies, without excep- tion, have funeral benefits (and that accounts for about 6,000,000). The collecting societies are about 7,000,000, and those are also death benefits. Then the great industrial in- surance companies have something likf 30,000,000 policies. There is hardly i household in this country where there is not a policy of insurance against death. A* 2 THE PEOPLE'S INSURANCE I will not stop to account for it. After all, the oldest friendly socie- ties in the world are burial societies. All that I would say here is we do not propose to deal with insurance against death. It is no part of our scheme at all, partly because the ground has been very thoroughly covered, although not very satisfactorily covered, and also be- cause this, at any rate, is the easiest part of the problem and is a part of the problem which is not beset with the (difficulties of vested interests. Fortun- ately, all the vested interests which deal with sickness and unemployment are of a thoroughly unselfish and bene- ficent character, and we shall be able, I think, to assist them, not merely with- out interfering with their rights and privileges, but by encouraging them to do the excellent work they have com- menced and which they are doing so well. Against Sickness Sickness comes next in the order of urgency in the working-class mind. There are over 6,000,000 policies that is hardly the word, perhaps, for friendly societies but there is provi- sion made by 6,000,000 people against sickness. Most of it includes a pro- vision for medical aid. There are, I think, about 300,000 or 400,000 mem- bers who have insured for medical aid alone, but I think, almost without ex- ception, the friendly societies include medical relief in the provision which they make. That is not, I think, the case with the trade unions. There are 700,000 members in the trade unions insured for sick benefits, but I do not chink that includes medical relief. In addition to those, there are a good many unregistered assurances at works, where a man leaves a shilling a month at the office for the purpose of paying the works' doctor. I should say, therefore, that between 6,000,000 and 7,000,000 people in this country have made some provision against sick- ness not all of it adequate, and a good deal of it defective. Against Unemployment Then comes the third class, the in- surance against unemployment. Here not a tenth of the working classes have made any provision at all. You have only got 1,400,000 workmen who have insured against unemployment. It is true that perhaps about half of the em- ployment of this country is not affected by the fluctuations of trade. I do not think agricultural labourers or railway servants are. affected quite to the same extent. Then there is provision for short time in some of the trades. Tak- ing the precarious trades affected by unemployment, I do not believe more than one-third or one-quarter of the people engaged in them are insured against unemployment. That is the provision made at the present moment by the working classes": 42,000,000 policies against death, from 6,000,000 to 7,000,000 who have made some kind of provision against sickness, and 1,400,000 who have made some provision against un- employment. Why the Government is taking Action Now comes the question which leads up to the decision of the Government to take action. What is the explanation that only a portion of the working classes have made provision against sickness and against unemployment? Is it that they consider it not necessary? Quite the reverse, as I shall prove by figures. In fact, those who stand most THE PEOPLE'S INSURANCE 5 in need of it make up the bulk of the uninsured. Why? Because very few can afford to pay the premiums, and pay them continuously, which enable a man to provide against those three contingencies. As a matter of fact, you could not provide against all those three contingencies anything which would be worth a workman's while, without paying at any rate is. 6d. or 2s. per week at the very lowest. There are a multitude of the working classes who cannot spare that, and ought not to be asked to spare it, because it in- volves the deprivation of children of the necessaries of life. Therefore they are compelled to elect, and the vast majority choose, to insure against death alone. Those who can afford to take up two policies insure against death and sickness> and those who can afford to take up all three insure against death, sickness, and unemploy- ment, but only in that order. Why do not the Working Classes Insure against Death, Sickness, and Unemployment ? What are the explanations why they do not insure against all three? (1) Low Wages The first is that their wages are too low. I am talking now about the unin- sured portion. Their wages are too low to enable them to insure against all three without some assistance. (2) Difficulty of keeping up Premiums The second difficulty, and it is the greatest of all, is that during a period of sickness or unemployment, when they are earning nothing, they cannot keep up the premiums. They may be able to do it for a fortnight or three weeks, but when times of very bad trade come, when a man is out of work for weeks and weeks at a time, arrears run up with the friendly societies, and when the man gets work, it may be at the end of two or three months, those are not the first arrears which have to be met. There are arrears of rent, arrears of the grocery bill, and arrears for the necessaries of life. At any rate he cannot consider his friendly society only. The result is that a very con- siderable number of workmen find themselves quite unable to keep up the premiums when they have a family to look after. Wages Spent in Other Ways Undoubtedly there is another reason. It is no use shirking the fact that a proportion of workmen with good wages spend them in other ways, and therefore have nothing to spare with which to pay premiums to friendly societies. It has come to my notice, in many of these cases, that the women of the family make most heroic efforts to keep up the pre- miums to the friendly societies, and the officers of friendly societies, whom I have seen, have amazed me by telling me of the proportion of premiums of this kind paid by women out of the very wretched allowance given them to keep the household together. Two Hundred and Fifty Thousand Lapses a Year I think it is well we should look all the facts in the face before we come to consider the remedy. What does it mean in the way of lapses? I have inquired of friendly societies, and, as near as I can get at it, there are 250,000 lapses in a year. That is a THE PEOPLE'S INSURANCE very considerable proportion of the 6,000,000 policies. The expectation of life at twenty is, I think, a little over forty years, and it means that in twenty years' time there are 5,000,000 lapses : that is, people who supported and joined friendly societies, and who have gone on paying the premiums for weeks, months, and even years, strug- gling along, until at last, when a very bad time of unemployment comes, they drop out and the premium lapses. It runs to millions in the course of a generation. What does that mean? It means that the vast majority of the working men of this country at one time or other have been members of friendly socie- ties, have felt the need for provision of this kind, and it is only because they have been driven, sometimes by their own habits, but in the majority of cases by circumstances over which they have no control to abandon their policies. Not One-half of the Workmen Insured against Sickness, not One-tenth against Unemployment That is the reason why, at the pre- sent moment, not one half of the work- men of this country have made any provision for sickness and not one- tenth for unemployment. I think it necessary to state these facts in order to show that there is a real need for some system which would aid the workmen over these difficul- ties. I do not think there is any better method, or one more practicable at the present moment, than a system of national insurance which would invoke the aid of the State and the aid of the employer to enable the work- man to get over all these difficulties and make provision for himself for sickness, and, as far as the most pre- carious trades are concerned, against unemployment. The Plan of the Government for Sickness I come at once to the plan of the Government. The measure of the Govern- ment will be divided into two parts. The first will deal with sick- ness, and the second with unemploy- r ment. The sickness branch of the Bill will also be in two sections; one will be compulsory and the other volun- tary. The Compulsory Clauses The compulsory part of the Bill in- volves a compulsory deduction from the wages of all the employed classes who earn weekly wages, or whose earnings are under the Income Tax limit. There will be a contribution, from the employer and a further con- tribution from the State. There are exceptions from the compulsory clause. Exceptions from Compulsory Clauses (a) Special Provision for Soldiers and Sailors The first will be in the Army and Navy. We are making special pro- vision for soldiers and sailors. It is a crying scandal, I think, that at the present moment there are so many soldiers and sailors who have placed their lives at the disposal of the coun- try, and are quite ready to sacrifice them, as we know from past ex- perience, broken through ill-health. I am talking now of ill-health not due to misconduct. These men leave the Army without any provision from either public or private charity, and they are broken men for the rest of their THE PEOPLE'S INSURANCE lives. I think it is a crying 1 scandal that that should occur in a country like this, and I hope that this scheme will put an end to it. There will be special provision made for that. But these men will not be regarded as in the employed class for the purposes I am about to explain. (b) Teachers The same thing applies to the teachers, and I hope to be able, with the assistance of my right hon. friend the President of the Board of Educa- tion, to largely strengthen their pre- sent position. I think their provision is very inadequate, and, compared with the provision made in other coun- tries, I think a very paltry allowance is made for their superannuation. I think the Irish case is a very bad case. I have had a number of Irish teachers before me, and some of them told me that they were getting about i a week. There are about 300 of them in the workhouses. They are doing their work for the Empire under very trying conditions, and I shall certainly consider it the duty of the Govern- ment, in any scheme of superannua- tion, to include the Irish teachers as well. (c) People Employed under the Crown or Municipalities We propose excepting all people employed under the Crown or under municipalities where, at the present moment, there is no deduction from their wages when they are ill, and where there is some superannuation allowance. There is no need to make provision for them because provision is already made. (d) Commission Agents The same thing will apply to com- mission agents employed by more than one person. (e) Casual Labour There is also an exception in the case of casual labour employed other- wise than for the purpose of the em- ployer's trade or business. We think it is vital that casual labour should be included. Otherwise the same thing may happen here as I am told happens in Germany, where the ex- clusion of casual labour is rather en- couraging its growth. That is a very bad thing in itself, and there is really no class which it is more important to include than casual labour. Casual labour at docks and in warehouses will be included. (f) Golf Caddies I think, too, that casual labour such as that of golf caddies should be brought in. I am making special pro- vision for labour of that kind. (g) Waiters Hotel waiters will be another diffi- culty. They are not paid salaries. I am told they very often pay for the privilege of waiting, and we have to make special provision for them. (h) Cab Drivers Cab drivers are another class we propose to include. All casual labour of this kind will be included. The man who offers to carry your bag for sixpence you can never draw in, but it is our intention to attract all casual labour possible within the ambit of our Bill. THE PEOPLE'S INSURANCE The Amount of Contribution I come to the amount of contribu- tion. The workman now pays to his friendly society 6d. or is. The usual contribution to a friendly society is something between 6d. and gd. t as far as I have been able to discover, and anything under that produces benefits which are benefits I do not think it would be worth our while to include in an Act of Parliament. The House will be interested to know what German workmen have to pay, because that was the first great scientific experiment in insurance on a national scale. It has been enormously successful. That is the testimony borne by all classes of Germans. I have taken some trouble to inquire, and the Ger- man Government have been exceed- ingly kind and helpful in placing information at our disposal. They have shown every disposition to be helpful throughout, and their testimony is that all classes of the community are very much benefited by it. The German Plan In Germany the payment is in pro- portion to wages, but the benefits are also in proportion to wages, so that the higher class of workman, who pays a very high contribution, gets a very substantial benefit. There are in Germany, I think, five classes of invalidity contributors, and for sickness every man pays according to his income. They divide their in- surance into two separate branches of sickness and invalidity. There are two separate branches, but we propose to include them in one branch. In Ger- many a man who earns 305. pays lofdL weekly for sickness and invalidity. There are not many of those. The man who is paid 245. a week, which I think is about the average wage in this country, if you were to strike an average, which it is a difficult thing to do the man who is paid 245. a week pays gd. a week. For that 9^. the benefits he gets will not be equal to the benefits we shall be able to give under our Bill twenty years hence. The 205. a week man pays 7^d., the 185. man 6fd., the 155. man sfd., the 125. man 4fd., and the 95. man In Germany, Benefits to Lower Classes very Small That is what the workman pays in Germany, and when you come down to these lower classes the benefits are so small that the workmen in Germany say they prefer to resort to parish relief as the benefits are much too inade- quate. For that reason we have decided In favour of one class, because if you have a scale which is proportionate it would be very difficult to give benefits to the lower class except by making special conditions which it would not be worth our while to make. It would certainly not give them a minimum allowance to keep their families from want. Government Plan One Scale for all Classes So we have decided to have one scale for all classes, with a provision for the lowest wages. Therefore, we have decided to propose a deduction of 4^. for men and 3^. for women. That is about a halfpenny per day and a penny on Saturday, or, as somebody told me, about the price of two pints of the cheapest beer per week, or the price of an ounce of tobacco. Now comes the difficulty of the man THE PEOPLE'S INSURANCE who is earning 155. a week and under, and who finds it rather difficult to pay 4^. a week. We meet that case by saying that a man or woman who earns 2s. 6d. a' day or less shall pay 3 and ni{ respectively. Are we going to charge the man of fifty more than the man of twenty-five? That is a question which, of course, presents itself the moment you begin to consider the actuarial position, be- cause, after all, sickness doubles, trebles, anop quadruples as you get along in life until when you get be- tween sixty-five and seventy the aver- age sickness in five years is fifty-two weeks. It begins with three or four days, then on to a week, then to a fortnight, and a man as he gets on in life becomes a heavier charge upon his friendly society, and no society can possibly take a man at fifty or forty- five on the same terms as if he were only sixteen or twenty unless they make special provision. A.Uniform Bate Charged Of course, we are now starting a new scheme, and the Government have decided to do this : to charge a per- fectly uniform rate throughout, calcu- lating the loss on older lives because there will be a heavy initial loss as the result of that operation cal- culating that loss, anticipating it, and making provision to wipe it out in so many years. We have made provision to wipe the whole of that loss out, charging a perfectly uniform rate, in fifteen and a half years.* After 15| Years, Increasing Benefits At the end of that time, of course, there will be a considerable sum that will have been realised for the purpose of increasing the benefits, and those who will come in early will then get the benefit of their thrifi by having a considerable sum of money added to the sum which is available for increas- ing the benefits. * Under the Act as passed, i8J years. IO THE PEOPLE'S INSURANCE Men Over 50 The only difference we make is with regard to men over fifty. We then propose to pay them reduced benefits. Men Over 65 Men who are over sixty-five at the present moment we do not propose should join the scheme at all, because that is an impossible undertaking ; the burden would be much too heavy, and, after all, we must be fair to the man who comes in young with his money. He must be encouraged, he must get his reward for it, and if we take over too heavy a burden in the way of those who are at present very old, the young people will suffer. I am told that is the criticism in Germany, that the young people do not get full value for their own money and the money of their employers. We propose to admit everyone up to sixty-five to insurance so long as it is done within twelve months after the passing of the Act. We are going to give twelve months' grace. If they come in after twelve months they will come in on the terms either of paying a rate appropriate to their age or of taking reduced benefits, which comes to practically the same thing. Mr. BALFOUR : Would not they come in at sixteen? Men who come in at 16 and after 16 Mr. LLOYD GEORGE : A man may only start work at twenty-five, and if he comes in after the first twelve months he has to pay a rate appro- priate to his age or to take reduced benefits for his life. There will not be very many such cases. The right hon. Gentleman is perfectly right : the rule would be that everybody would come in at sixteen, but there may be people who come in after sixteen. In that case they will pay according to age or take reduced benefits. We make a certain exception about sixteen, be- cause if a man has been training at a technical college, for instance, or in some other way he is usefully em- ployed in training himself for life, then we do not insist upon sixteen as a rigid limit. So much for the contribution by the employee. The Employer's Contribution Now we come to the contribution of the employer. What interest has the employer in the matter? His interest is the efficiency of his workmen, and there is no doubt at all that a great insurance scheme of this kind removes a great strain of pressing burden and anxiety from the shoulders of the work- ing classes, and increases the efficiency < of the workmen enormously. Work- ing men have told me that many a time they have gone on working at their business because they dared not give it up, as they could not afford to, though they ought to have been in the doctor's hands. This procedure generally brings about a very bad- breakdown, and not only that, when a man is below par neither the quantity nor the quality of his work is very good. German Employers' Experience of Insurance I have taken the trouble to make some inquiry from the German em- ployers as to their experience of insur- ance from this point of view, and I have got a number of answers which, perhaps, later on the House would be interested in having circulated. Here THE PEOPLE'S INSURANCE is one instance I had out of many. It is the opinion of an employer engaged in the steel industry. He said : "There can be no doubt that the Insurance Laws, together with the increase of wages, have exercised an enormously beneficial influence upon the health, standard of living, and the efficiency of workers." Another great employer of labour says : "That from the employers' stand- point these laws pay, since the effi- ciency of the workman is increased." There is this very curious posi- tion in Germany that the em- ployers, and the largest employers, are voluntarily offering to increase their contributions to National insur- ance for increased benefits. That is the view taken by the employer in Germany. What the German Employer Pays What does he pay for sickness and invalidity insurance? He pays for a 305. a week man J^d. For a 245. a week man the employer would pay 5! d. and for an 185. a week man he pays 4*d. When it goes down below that the contribution is very much lower, and the benefits are very poor. We propose that the employer should pay $d. a week, the workman 4<1 ; a woman worker 3^., and the em- ployer 3d. for man and woman alike. The State's Contribution 1 come to the contribution of the State. The advantage of the scheme to the State is, of course, in a happy, contented, and prosperous people. The German contribution is not a very large one. 1 believe it is about ^"2,500,000, and that includes Old Age Pensions. We have already got a burden of ^13,000,000 a year for Old Age Pensions. But let me point this out to the House, that payment is equivalent to something like 5^. a week for employer and labourer under this scheme, and it makes matters very much easier. We certainly could not have offered the benefits which we are offering in this measure, qd. for a workman and 36?. for an employer, had it not been that the whole burden of pensions over seventy years of age had been taken over by the State. The first actuarial fact borne in upon me the moment I came in contact with the actualities was that an enormous difference was thus made in the scheme, and that it greatly eased mat- ters. Had it not been for that I should have proposed very much dearer and sterner terms both for the employer and the employed. We do not propose that the State contribution should end with that ^"13,000,000. We propose that the State contribution shall be the equiva- lent of 2d. a member. How the Difficulties of Workmen are met I .should like to point out how we are meeting the three difficulties ex- perienced by contributaries in making provision for sickness. The first diffi- culty is the lowness of the wages. We are meeting that by a State con- tribution and a contribution from the employer which enables us to depress all round the amount of contribution demanded from the workman. More than that, we have a special scale for those whose wages are lower; that is how we meet the case of low wages. I want to point out how we meet the case of the man who is unable to pay 12 THE PEOPLE'S INSURANCE because of sickness and of unemploy- ment, because really this is the most serious difficulty that the workman has to encounter. We therefore propose special provisions for him. In the friendly societies, as everyone knows who is acquainted with their working, during sickness, whether you are sick or whether you are unem- ployed, you have to go on paying steadily. It is true that, not being societies working for profit, and being really quite worthy of their name of friendly societies, with a great sense of brotherhood, they make special efforts to spare their men the last dire necessity of expulsion, but still they have to get their money, and what they do is this. No Deductions from Benefits when a Man is Sick When a man is sick he may get a nominal allowance of los. a week, but his 6d. or his qd. will be deducted, so that where he is nominally getting los. he is really getting gs. 6d. That is the time that 6d. is worth more than 2s. 6d. to a man in full wage. We propose to make no deduction at all from benefits, but where a man is receiving sick pay we do not propose that that should be counted against him at all. With regard to unem- ployment, there will be no deduction, and the mere fact that he has failed to pay from that time will not be reckoned against him when we come afterwards to compute the number of payments he has made. Mr. BALFOUR : It will count exactly as if he had paid. Mr. LLOYD GEORGE : That is a better way to put it. Now I come to unemployment. How the Workman Pays during Sickness and Unemployment What is the workman to do when he is out of work? How is he to pay his contributions? We propose allowing a 6 per cent, margin for unemployment; that means three weeks a year. As long as a man is employed you de- duct 4^., but we allow a margin of three weeks a year for unemploy- ment. That means in a cycle, say of four years bad times may come once every four years let us say a margin of twelve weeks of unemployment. We propose to do more than that. After he has exhausted his twelve weeks, if he is still unemployed, then' up to 25 per cent. that means thirteen [ weeks a year we still allow htm, but at reduced benefits. Up to three weeks there is no reduction in his benefits at all. He is allowed that free margin for unemployment. Beyond that, up to thirteen weeks a year, he is allowed^ without expulsion, or without his policy lapsing rather, to go on; but then there is a corresponding reduction in the benefits. I am still dealing with the difficulty of a man paying his contribution dur- ing sickness and unemployment, and I am just showing how the Government make special provision for the payment of contributions in these periods. Later on I will point out that it is also pro- posed that what is called a Distress Fund in friendly societies should be set up which will help the workman to pay arrears of contribution for unemploy- ment or for some other reason. That is the compulsory clause as far as con- tributions are concerned. The Voluntary Contributors I now come to the voluntary con- tributors. There are two classes of voluntary contributors. THE PEOPLE'S INSURANCE (1) The Small Tradesman, the Village Blacksmith and Schoolmaster There are persons who, whilst not working for an employer, are engaged in some regular occupation and are mainly dependent on their earnings for their livelihood. Take the village blacksmith who is not working for any employer, but is depending on his earnings for his livelihood. The same thing will apply to the small tradesman. I find looking through the lists of the friendly societies, in some of them there is a very high percentage of men who do not belong to the em- ployed class in the ordinary sense of the term. For instance, in rural dis- tricts, you will find that all the pub- licans, all the tradesmen, the school- master, the village blacksmith, and the man who is joinering on his own, who is not anybody's man, are mem- bers of friendly societies. We propose that they should be allowed to be mem- bers of this insurance scheme. They are really a great source of strength to the friendly societies. They help them in the management, and their business knowledge is of infinite value. It would be a great accession of strength to any scheme of this kind that we should still retain in it men of that type. (2) Men who have been Employed and are now Working on their Own Account Then there is the other class of men, those who have been employed work- ing for others and have ceased to do so, and are working on their own account. So long as they have been contribu- tors for five years we allow them still to join. With regard to this class, there is a difficulty in allowing them to come in at any age and at all ages. With an employed class, you have always the test of employment for wages, but with this class, if a man is a trader, or is working on his own account, doing as little or as much as he likes, there is no test of that kind, and unless there is some sort of check you might have a rush of people who are fairly old coming in at the last moment to get benefits which are quite out of proportion to the contribution which they pay. An Age Limit for the Voluntary Class Therefore, as far as the voluntary class is concerned, we are bound to put a limit to the age at which they can be allowed to join at the uniform rate. We propose that all those of that class who wish to join within six months, and who are forty-five years of age and under, can join at a rate which covers the 4^. or 3 d. as the case may be, whether they are men or women, they themselves paying the employer's contribution. That would mean that they would pay 7'> and in iQJS' 16 a ful1 year ^4,563,000. That is the ex- pense, so far as the State and the con- tributors are concerned, of that part of the scheme. thing which has happened once or twice, but something that comes regu- larly every so many years. We know it will come, and we know that distress will come with it ; therefore we ought to take some means to alleviate the misery caused by phenomena which we can reckon on almost with certainty to within a year or two of its advent. Unemployment Insurance I will now briefly outline the unem- ployment insurance. My explanation will be considerably curtailed, owing to the fact that the Home Secretary very fully explained to the House the year before last the principles upon which the Government intended to proceed. The scheme only applies to one-sixth of the industrial population. We pro- pose to apply it only to the precarious trades, which are liable to very con- siderable fluctuations. The benefit will be of a very simple character; it is purely a weekly allowance. The machinery is already set up, therefore it will not be necessary to explain that. The machinery will be the Labour Ex- changes and the existing unions which deal with unemployment. I will not say anything about the suffering- caused by unemployment. All I will say is that, whoever is to blame for these great fluctuations in trade, the workman is the least to blame. He does not guide or gear the machine of commerce and industry; the direction and speed are left almost entirely to others. Therefore he is not responsible, although he bears almost all the real privation. Possibility of Foreseeing Periods of Unemployment It is about time we did something in this matter, because it is not some- The Effort made by the Trades Unions No real effort has been made except by the trades unions. That, of course, is a purely voluntary matter, and the burden is a very heavy one. It only applies, in their case, to very few trades, and I think to only about 1,400,000 workmen altogether. The others cannot afford it. Other trades have attempted it, but have laid it down because they could not afford the expense. Unsuccessful Experiments on the Con- tinent On the Continent many efforts have been made, mostly failures, because they were all on the voluntary prin- ciple. In Cologne there was a great effort. It ended in about 1,800 people being insured out of a population of 200,000 or 300,000. There it meant people who knew they would be out of work, and who insured against almost certain unemployment in the winter. That is very little good. I came back, after examining some of these schemes, with the conviction that you must have, at any rate, three or four conditions. You must have a trade basis, to begin with. A munici- pal basis will not do; it must be a trade basis, because the fluctuations are according to trades. You must start with the more precarious trades. The scheme must be compulsory. THE PEOPLE'S INSURANCE 29 I also came to the conclusion that the workmen's unsupported efforts are quite useless. Two Groups of Trades taken in the Bill These are the principles that we have incorporated in our Bill. We have started, first of all, by taking two groups of trades, and we propose to organise them individually the engin- eering group and the building group. They include building, construction of works, ship-building, mechanical en- gineering, and the construction of vehicles. These are the trades in which you have the most serious fluc- tuations I think for a very good reason. The depression seems to fall more heavily on these trades ; it seems to concentrate upon them, because they produce the permanent instruments of industry. Unemployment Distress Allowance We propose that in these trades a fund shall be raised for the purpose of paying an unemployment distress al- lowance. I ought to say here that you have not the same basis for actuarial calculation that you have in reference to sickness. It is very necessary to warn, not merely the House, but rather more especially the workmen upon this point. You cannot say with the almost certainty that you can in sickness that a certain fund will produce such and such benefits. In the case of sickness you have nearly 100 years' experience behind you, and you have the facts with regard to sickness and death. You have not the facts with regard to unemployment, and the question is very difficult. All we know is that in certain branches of trade unemployment is pre- valent and appalling. Some trades meet it by short time, but in other trades you cannot do that. As a matter of fact, in the building trade you may get men working overtime in one place at the very time when 20 per cent, of the workmen are out of work in another. Proposals as to Amounts to be Paid by Workman and Employer We propose that the workman should pay 2\d. per week and the em- ployer 2|d., and that the State should take upon itself one-fourth of the total income. We propose that there should be an abatement to those employers who choose to pay for their workmen by the year. The extent of that abatement is very considerable. If you take the two contributions of employers and workmen at 2jd., they come to 2i5. 8d. per annum. We propose that the employer who will under- take to insure a workman for the whole of a year can do so for 155. He will get the whole benefit of the reduction. It is proposed that the workman shall pay the full 2\d. , but that the employer should get the whole benefit of the abatement. It seems a Very serious abatement. It is practically telling him that he can take one-half if he under- takes to insure the workman for a year at a time. It is an inducement to him to give regular employment; it is a discouragement of casual labour; it is a reward to the employer who keeps his workmen for a whole year. It is a very heavy one, but I think it worth while. That is the only exception made to the employer. Benefits We propose, by way of benefits, to give, in the engineering trade, 75. per week unemployed pay, and in the build- THE PEOPLE'S INSURANCE ing- trade 65. for a maximum of fifteen weeks. The number of weeks is limited to fifteen, because, I again say here, there is no basis of actuarial calcula- tion, and you will have to watch the thing. Distress Fund Now, you will have a huge distress fund, to which the employers will con- tribute very nearly ;i, 000,000 and the State ;*7 00 > 000 or ^"800,000 for the purpose of relieving the distress, and to enable the workmen to insure where otherwise they could not do it. But you cannot guarantee that it will work out at these figures. Method of Working Having consulted the very best ac- tuaries at our disposal, we are firmly convinced that the fund will work out in this way. What will happen? The workman who is out of work will go to the Labour Exchange. We want someone there to check him, so that you will not have a man who is not genuinely unemployed getting unem- ployed pay. Therefore you have to do this through the Labour Exchange. The man will take his card and they will offer him a job. If he refuses a job, then comes the question : Who is to decide whether he is unemployed or not? We have appointed an impartial court of referees to decide this; we cannot leave it to the Labour Ex- changes entirely, or to the workmen, to decide whether the man is to take a job or the 75. unemployed benefit. Those/ Excluded from Sharing in Distress Fund There will be no payment for a work- man dismissed through his own misr conduct. There will be no payment under this scheme where there is un- employment by reason of strikes or lock-outs, because this scheme has absolutely nothing to do with them. It is purely a relief scheme for unem- ployment which is due to fluctuations of trade. Case of Trade Unions Take now the trade unions which insure themselves against unemploy- ment. We propose in that case that they should reap the benefit, but we cannot possibly hand over State funds certainly not employers' funds to an organisation, the object of which, in the main, is to fight out questions of wages and conditions of labour with the employers. What we propose is that the trade union shall pay its un- employed benefit to the men and claim from the fund repayment in respect of the amount which the men would have been entitled to draw had they gone direct to the Labour Exchanges. The State in effect allows trade unions to spend this money, and at the same time it protects against the unfairness of subsidising what after all is a war- chest as the trade unions admit. Particulars of Methods of Payment of Benefits There is no payment for the first week of unemployment. Besides, no man can draw more than one week's benefit for five weeks of contribution, so that the real loafer soon drops out. The meshes of the Labour Exchange net might not catch him at first, but eventually and automatically he will work himself out, owing to the fact that he is not a regular contributor, and therefore he will come to an end of his right to obtain benefits. We also propose that where there is THE PEOPLE'S INSURANCE a society established on the Ghent model for the purpose of providing un- employed pay generally for the people, say, in the neighbourhood, to give a contribution of one-sixth to that fund for the purpose of enabling them to dispense unemployed pay. Other Trades may apply for inclusion under the Scheme If any other trade wishes to come in they are to have, what I think they call in the Court of Chancery, "liberty to apply." If they make out their case and are prepared to make their contribution, it will be possible to include them in our scheme. But for the moment we propose to begin to work the experiment with these trades, which are the very worst trades from the point of view of unemployment. Finance of Present Scheme This scheme will apply to over 2,400,000 workmen. The contribu* tions of the workmen will be ;i, 100,000. The contributions of the employers will be ^900,000. The cost to the State Mr. AUSTEN CHAMBERLAIN : But you said the contribution from the work- men and the employers are to be the same. Mr. LLOYD GEORGE : I thought I had made it quite clear that there is a very considerable abatement to the em- ployer. It is equivalent to ^200,000 on the whole scheme to the employers if they undertake the responsibility of insuring the whole of their workmen by the year. The cost to the State will be approxi- mately ^750,000 a year. The expendi- ture will undoubtedly fluctuate with the state of trade, and a fund will therefore have to be created for the purpose of dealing with times of very great distress. That is the position as far as both of these branches are con- cerned. The total sum to be raised in the first year is ^24,500,000, of which the State will contribute ^2,500,000. By the fourth year the State's contri- bution will have risen to nearly ^"5,500,000. That is the finance of the scheme. Number Benefited I have explained to the House as best I could this great matter, and I thank Members for the courtesy 'with which they have listened to me. I have explained as best I could the details of our scheme the system of contribu- tions and of benefits and the machinery whereby something like 15,000,000 of people will be insured, at any rate against the acute distress which now darkens the homes of the workmen wherever there is sickness and unem- ployment. Proposals at least a Partial Remedy I do not pretend that this is a com- plete remedy. Before you get a com- plete remedy for these social evils you will have to cut in deeper. But I think it is partly a remedy. I think it does more. It lays bare a good many of those social evils, and forces the State, as a State, to pay attention to them. It does more than that. Meanwhile, till the advent of a complete remedy, this scheme does alleviate an immense mass of human suffering, and I am going to appeal, not merely to those who sup- port the Government in this House, but to the House as a whole, to the men of all parties, to assist us. Not a Party Measure I can honestly say that I have en- deavoured to eliminate from the scheme any matter which would cause legitimate offence to the reasonable susceptibilities of any party in the THE PEOPLE'S INSURANCE House. I feel that otherwise I would have no right to appeal, not only for support, but for co-operation. I ap- peal to the House of Commons to help the Government not merely to carry this Bill through but to fashion it; to strengthen it where it is weak, to im- prove it where it is faulty. I am sure if this is done we shall have achieved something which will be worthy of our labours. A Measure that will Believe Untold Misery in Myriads of Homes Here we are in the year of the crowning of the King. Men from all parts of this great Empire are coming not merely to celebrate the present splendour of the Empire, but also to take counsel together as to the best means of promoting its future welfare. I think that now would be a very opportune moment for us in the Homeland to carry through a measure that will relieve untold misery in myriads of homes misery that is undeserved ; that will help to prevent a good deal of wretchedness, and which will arm the nation to fight until it conquers "the pestilence that walketh in darkness, and the destruc- tion that wasteth at noonday." SCOPE OF THE INSURANCE SCHEMES Compiled from Explanatory Memoranda issued by the treasury ana the Board of Trade at the time the Bill was introduced Some of the -proposals explained need to be considered in the light of the amendments adopted later. PART II SCOPE OF THE INSURANCE SCHEMES A. INSURANCE AGAINST SICKNESS i. THE OBJECTS OF THE SCHEME. To effect Insurance against Sickness and Breakdown To act as a Measure for the Reduc- tion of Sickness THE Bill is intended to effect as wide an insurance as possible of the work- ing population against sickness and breakdown. It is also intended to make the* Bill as far as possible a pre- ventive measure operating to reduce the amount of sickness. Both the Majority and Minority Reports of the Poor Law Commission call special attention to the utter inadequacy of our methods for preventing and curing sickness amongst the industrial classes. This Bill contains several provisions designed to amend this unsatisfactory state of things. In other words, it is, as described in the title, a Bill for "National Health Insurance and^the Prevention of Sickness," the title " In- validity Insurance " being by no means a suitable one for English purposes. Points of Difference from the German Scheme : (1) Administration by Friendly Societies The plan differs from the German scheme of sickness and invalidity in- surances in the following respects : It is proposed that under proper safeguards the administration of the fund should be handed over to the great friendly societies either already established in this country or hereafter to be founded under the Act. As all deficits due to malingering will have to be borne either in levies or loss of benefits by the members of a default- ing society, and not by the State ot the employer, there is every induce- ment to economy. Bad management will be promptly and effectively penal- ised. Good management will be rewarded. In Germany the system is much more bureaucratic in its management, and does not nearly to the same extent adopt the principle of self-government. (2) Deficiency in starting the Scheme to be wiped out in 15 to 16 years In starting a universal scheme there must necessarily be a very heavy burden during the earlier years of its operation, owing to a large number of persons entering it at an age when. their contributions are actuarily in- adequate to ensure the benefits guaran- teed by the Bill. Unless financial arrangements are made to liquidate the loss so arising it will fall on future generations of insurers. The finance of the present scheme will be so arranged that the deficiency inevitable in starting a scheme which THE PEOPLE'S INSURANCE includes all ages shall in fifteen to six- teen years be completely wiped out.* At the end of that period the adminis- trators of the funds will be in a posi- tion to declare increased benefits, e.g., the reduction of the pension age. (3) Rates of Weekly Payments Produce Proportionately Higher Rates than in Germany The fact that the superannuation of all persons over 70 is undertaken by the Government in this country, whereas in Germany it is a burden on the contributory scheme, makes an enormous difference in the rates of weekly payments, which suffice under the proposed scheme to produce higher benefits than those conferred by the German scheme. Moreover, the Ger- man Government makes no contribu- tion to the cost of sickness as distin- guished from invalidity, whereas the present scheme proposes to pay one- quarter of such cost in the case of women and two-ninths in the case of men. (4) Other Points of Difference There are several other points of difference between this scheme and the German system, e.g., it is not pro- posed to adopt the German plan of dividing the industrial population into five classes according to the rate of wages earned and not, as in Ger- many, to set up separate machinery for sickness and invalidity. By taking this course, and by the machinery which has been adopted for the collec- tion of contributions, the inconveni- ence and trouble likely to be caused to employers will be greatly diminished. There are other points of variation, notably in the measure of control given * Under the Act as passed, i8J years. to the workmen, which will appear later on. Another paper is being cir- culated to give particulars of the Ger- man insurancei 2. THE SCOPE OF THE SCHEME. Bill will Extend to Whole of U.K. The Bill will extend to the whole of the United Kingdom. The Bill will partly rest upon com- pulsion. It is proposed that the insur- ance moneys should in part be col- lected at the source by deductions from wages. It is therefore necessary to decide how far this compulsion should go that is, what classes of persons should be compulsorily included and what should be the position of persons who choose to join the scheme volun- tarily. The following proposals are made : Classes of Persons Compulsorily Included The compulsory deduction from wages will extend to all persons of whatever nationality under contract of service, whether paid by the hour, day, week, month, or year, to include artisans, mechanics, miners, clerks, shop assistants, servants, sailors in the mercantile marine, unpensionable em- ployees of local authorities, railway employees, golf caddies, &c., &c. The compulsory deduction will also extend to out-workers in such classes of work as may be covered by Order of the Home Office under the Factory and Workshop Act, 1901. It will also include cases of joint employment, e.g., employment in a mine through gangers, the mine-owner being made responsible. Exceptions to the Compulsory Inclusions It will not extend to (i) Agents paid by commission or fees, and employed by more than one employer. THE PEOPLE'S INSURANCE 3? (2) Such persons as washerwomen, sempstresses, &c., executing small orders on their own account. (3) Wives employed by husbands. (4) Extremely precarious personal employments, e.g., luggage carriers, not connected with a trade or business. (5) Casual domestic employment. (6) Jobbing occupations, e.g. y gar- deners, if working on their own account. (7) Persons receiving more than 160 a year from their employers by way of salary. Case of Soldiers and Sailors (8) Soldiers and sailors, who will be dealt with separately. A reduced deduction from wages will be made in these cases (the soldier, sailor, &c., being cared for while in the service of the Crown) to provide the necessary reserve against the time when the service ceases, with further assistance from public funds to make special provision for invalid soldiers and sailors. (9) Pensionable employees of the Crown or of local authorities. The Treasury will have power by regulations to extend the compulsory deduction from wages to other classes of employees not included in the defi- nition. Responsibility of Employers In the case of persons employed for no money wage, or appointed by one person and paid by others, the em- ployer will be made responsible for see- ing that the person employed is in- sured. The class of persons such as cab- drivers or boatmen, who live by " working " a cab or boat for which they pay the employer, will also be included. Case of Occasional Employment There is a large class of persons who only go into employment occasion- ally (say, for a period of less than thirty-nine weeks in the year), and it may be considered that there is no reason why the State should require such persons to insure themselves, as it is unfair to enforce contributions which might never materialise into benefits. Exemption from deductions from wages will, therefore, be allowed on request in such cases to (i) persons who prove that they have a pension or income of 26 a year; (2) married women and persons dependent on the labour of other persons who do not habitually g-o to work in one of the employments which fall within the initial definitions. The employer will be liable to contribute in such cases. So far as the Bill does not rest upon compulsion as above defined, it is pro- posed to allow all other persons to join the scheme or not as they may choose, provided that they are engaged in some occupation by which they seek their livelihood. It has been neces- sary to exclude married women (non- workers) from insurance, because it is impossible to devise any scheme to control claims for sick pay in such cases. 3. THE CONTRIBUTIONS. Contributions will cease at 70. Persons over 65 years of age at the commencement will not be taken into insurance. Rates of Contributions The rates for employed persons will be uniform For men, 4^. a week, deductible from wages. THE PEOPLE'S INSURANCE For women, 3^. a week, deductible from wages. For the employer, 3^. a week for both sexes. The State's Contribution The State's contribution will be the payment of two-ninths of the benefits in the case of men, and one-fourth in the case of women. It will not be paid in the case of persons of foreign nationality who have not become naturalised. Variations in Apportionment of Bates These contributions will be subject to a variation in the apportionment as between employer and employee in the case of persons over the age of 21 where the person employed does not receive "board and lodging," as under* : If the wages do not exceed is. 6d. a day, the employer is to pay 6d. for men, $d. for women; the em- ployee is to pay id. If the wages do not exceed 2s. a day, the employer is to pay 5^. for men, qd. for women; the em- ployee is to pay 2d. If the wages do not exceed 25. 6d. a day, the employer is to pay qd. for men, 3^. for women ; the em- ployee 3d. If the wages exceed 2$. 6d. a day, the employer is to pay 3d. ; the man 4d., the woman 3d. Voluntary Insurance Persons who are entitled to insure voluntarily, and who are under the age of 45 at the commencement of the scheme, will be given six months to join the insurance on paying *?d. (if * For rates finally adopted, see page 165. men), 6rf. (if women). Such persons if over 45 and persons under 45 joining subsequently to the six months will be required to pay rates increasing according to their ages, in no case less than 7d. (or 6d.}. 4. THE BENEFITS. Minimum Benefits : The contributions have been calcu- lated to enable the approved societies who administer them (see heading 5 below) to grant certain minimum benefits, and if the societies manage their business prudently they will also be able to grant some one or more of certain additional benefits. The minimum benefits will com- prise (1) Medical Attendance (a] Medical attendance throughout life for the person insured. The societies will be responsible for making arrangements with doctors for attend- ing upon sick members, but prohibited from making any arrangement under which the doctor would be required to provide medicine for any insured per- son. The societies will have to pro- vide these expenses themselves, except in special circumstances in rural dis- tricts. (2) Sanatorium Fund (b) is. 3d. a head annually for a sanatorium fund throughout life. It is further proposed to pay a capital sum of ;i, 500,000 into a special fund to be used in making grants for building sanatoria, on condition that funds are also raised locally, and to make an additional yearly grant of id. per mem- ber to the sanatorium fund, as ex- plained later. The total income avail- able for preventive work is thus is. 4d. THE PEOPLE'S INSURANCE 39 a head annually, and it should be added that power is taken to use the additional grant of id. for research purposes. (3) Sickness Benefits* (c) IQS. a week in sickness for men and 75. 6d. a week for women for 13 weeks from the fourth day of sick- ness in each case, and 55. for the next 13 weeks. Members over 50 and under 60, who have not made 500 contribu- tions, will receive 75. a week only for the first 13 weeks if men, and 65. only if women; and if over 60 such mem- bers will receive 55. in both cases. (d) 5*. for the remainder of sickness. (4) Maternity Insurance (e) A maternity benefit pf 305. pay- able from the father's insurance unless the mother is an insured person, when it will be paid from her insurance. Limits of the Benefits in Certain Cases (Youth and Old Age) Benefits (c) and (d) cease at 70 for both sexes. Young (unmarried) persons under the age of 21 will receive smaller bene- fits under (c) and (d) at the rate of 5*. for the boys and 45. for the girls.* Boys and girls under the age of 16 will only be entitled to medical attend- ance and sanatorium treatment, the balance of their contributions being accumulated in order to enable the whole scheme to be extended at an earlier date than would otherwise be possible. Margin of 10 Per Cent. Profit Antici- pated According to the actuarial calcula- tions which have been made the pro- posed contributions will provide a * For rates of benefit finally adopted, see page 168. margin of approximately 10 per cent, in addition to the amounts required for the payment of the minimum benefits, the societies' costs of administration, and the liquidation of the original de- ficit in fifteen to sixteen years.* This margin will, if the actuarial anticipations are realised, be made available for the grant of " additional " benefits, as provided for in the Bill, as soon as experience shows that it can safely be devoted to that purpose. Application of the Margin Well-managed societies will thus almost from the outset be able to make a very substantial addition to the stan- dard schedule of benefits, while in all cases the existence of the margin will operate to prevent deficiencies arising from casual and accidental variations from the assumed rates of sickness, and so as a rule to obviate the neces- sity for bringing into operation the special machinery necessary for deal- ing with such deficiencies, viz., levies upon members or reduction of benefits below the standard schedule. Additional Benefits The additional benefits will include such benefits as the following : (1) Free Medical Attendance (1) Free medical attendance for de- pendants. (2) Benevolent Fund (2) Benevolent fund for distressed members. (3) Extension of Sick-pay Period (3) Extension of period of full sick pay to 26 weeks; granting sick pay from first or second day of sickness; * Under the Act as passed, 18^ years. 4 o THE PEOPLE'S INSURANCE increasing sick pay either in all cases or in the case of married men with large families. (4) Convalescent Allowance (4) Convalescent allowances in selected or necessary cases. Building and maintaining convalescent homes. (5) "Pocket Money" (5) " Pocket money " for men in hospital or convalescent homes, who are being paid for. (6) Additional Invalidity or Super- annuation Benefit (6) Additional invalidity or super- annuation benefit, or addition to Old- age Pension. For instance, the socie- ties might (when their funds permit) begin to grant a pension before 70, with an option to the recipient of taking an increase to his Old-age Pen- sion if he prefers to wait till 70. (7) Extension of Maternity Benefit (7) An extension of the maternity benefit. Reduced Benefits in Certain Cases The Bill will require the societies to grant a reduced benefit under (c) and (d) in cases where those benefits are more than two-thirds of the wages earned by the insured person com- pensation for the reduction being made by the grant of one or more additional benefits of a value equivalent to the reduction. The insurance office's con- sent would be necessary to any such adjustment of benefits. The power so granted may also be used in other cases with the consent of the insurance office. Conditions under which Benefits will be Payable The Bill will specify some of the conditions under which the benefits will be payable, the remainder of the conditions for the minimum benefits and all conditions for the grant of additional benefits being left to regula- tions to be drawn up with the help of the Committee to be appointed under the Bill. All societies in administering the benefits will be required to conform to those conditions which are embodied in the Bill or regulations. Those of them which are not so prescribed will be left to the rules of the societies : Particulars as to Benefits (1) Medical Attendance (a) Medical attendance. This will commence on entry into insurance (ex- cept for the first six months of the operation of the Act), and run through- out life. (2) Sanatoria (b) The rules as to sanatoria will be made by the "Local Health Com- mittees," as to which see later. (3) Sickness Benefits (c) and (d) Temporary and perma- nent sickness. The following rules or regulations will apply : (a) Notice (i.) That notice of sickness must be given to the society. (b) Date of Commencement of Sick Pay (ii.) That sick pay will only com- mence as from the fourth day after such notice has been delivered, no pay- ment being in fact made for the first three days. THE PEOPLE'S INSURANCE (c) Proof of Sickness (iii.) That the member must prove that he has been rendered unfit to pro- vide his maintenance by some speci- fied sickness or physical or mental dis- ablement. (d) Doctors' Certificates (iv.) Rules will be sanctioned to pre- scribe the periods for which a doctor's certificate will be required, i.e., whether a certificate must be produced once a week, or once a fortnight; and to deal with the case of members resi- dent at some distance from the offices of their society. (e) Behaviour of Patients (v.) Rules will be sanctioned for the behaviour of members during sickness, but strict compliance with the direc- tions of the doctor will be required. Societies will have to arrange for women visitors to visit women. (f) Waiting Period (vi.) A waiting period of six months has been laid down for the temporary sickness benefit, and of two years for the permanent invalidity benefit. (g) Refusals of Sick Pay (vii.) Societies will be allowed to follow their own rules for refusing sick pay in the case of sickness brought on by the member's own misconduct. They will, however, be required to give medical attendance in such cases, even if sick pay is refused. (h) Recurrence of Illness (viii.) If a member has received tem- porary sick pay and recovered from his sickness and falls sick a second time, such second sickness wUl be reckoned as continuous with the first, unless a period of 12 months has elapsed and the member has followed his usual occupation and paid his con- tributions. (i) Fines for Offences (ix.) The societies will be given power to impose fines not exceeding 20 shillings for repeated offences and to suspend payment of benefit for a period of not more than one year for any violation of The above conditions, or for imposing on the funds, or for refusing to obey the rules of the society. They will also Be given power of expulsion, as indicated later. (j) Advances on Compensation (x.) Sick pay (temporary and per- manent) will not be paid except by way of advance to persons entitled to com- pensation under Act of Parliament or the Common Law, unless the amount of such compensation is less than the benefit to which the member is entitled, when the difference will be made up. Advances will be recoverable by legal process or deducted from future bene- fits. Actions at Law by Societies against Individual Members Alternatives have been inserted giving the societies power (i) to take legal action in support of a member's claim, and (2) to refuse payment of benefit if the person injured does not take action. The societies will, of course, be liable to costs if they take action and lose the case. If they win the case they will be made trustees of any sum awarded. Also, the consent of the society has been made necessary for the acceptance of any lump sum in voluntary commutation of a weekly 4 2 THE PEOPLE'S INSURANCE payment, and it has been left to the societies, subject to appeal, to deter- mine the amount of the set-off from benefits under this Act when a lump sum is paid. Where a lump sum is awarded by the Court, the award will be communicated to the approved society concerned. Maternity Benefit (e] Maternity Benefit. Societies will not be allowed to pay this benefit in cash to the insured person or her hus- band, but will be required to pay expenses incurred up to the sum of 305. under prescribed conditions. Non-assignment of Benefits. A clause has been inserted prohibit- ing the sale, transfer, pledging 1 , or assignment of benefits. No Money Benefit allowed to Inmates of Hospitals, etc., unless they have Family or Relatives to Support A clause is also inserted to the effect that when a member becomes an inmate of a hospital, asylum, infirmary, or workhouse under the charge of any public authority, or of any chanty, no money benefit shall be allowed unless he has a wife or children or other rela- tives dependent upon him for support, when the amount due shall be paid for their relief and maintenance. Societies and Convalescent Homes Societies will be given power to make agreements to pay the money benefit towards the maintenance of members who are taken in convalescent homes whose rules require the pay- ment of at least one-half of the cost of maintenance; and also, they will be authorised to grant subscriptions, at their discretion, to hospitals and other charities, and to district nurses. As regards Women. Women, Marriage, and Employment Women marrying and ceasing to be employed within the meaning of the Act will not be insured.* If they be- come widows, and go into employment, they wifl be entitled at once to rejoin the insurance. So, too, women now married who become widows after the Act has come into operation, if they then go into employment, will be en- titled to be insured at the rate applic- able to employed people (with the full waiting periods). The right so given to women to insure late in life is a very valuable one. Married women who go to work will be insured under the same conditions as other persons as regards arrears ; but, as already indicated, they will be entitled to claim exemption if their employment is irregular. Arrears accruing during marriage will be wiped out on widowhood. The effect of these provisions is that, if an in- sured woman is left an invalid at her husband's death, she at once gets the benefit of her own insurance. Transfers from the Class of Employed Persons to the Class of Voluntary Members, and vice versa. A difficulty arises for which it is necessary to make rules, -owing to the fact that there will be a number of voluntary members liable to pay a higher rate of subscription than the employed rate. Such persons will therefore desire to pose as employed members in order to obtain the benefit of the lower rate ; and it is necessary to protect the societies and the insurance funds against such imposition. * Special provisions for married women were adopted in Committee. See section 44 of Act. THE PEOPLE'S INSURANCE 43 The following rules are neces- sary : Rules (1) Evidence of Regular Em- ployment (1) Persons who enter the scheme as employed members will be charged the employed rate and will be allowed to remain at that rate if they remain in employment for a period of five years. When they enter a society they will be required to furnish evidence that they are regularly employed. (2) For Voluntary Members who become Employed (2) Persons who go into employ- ment, having been previously insured as voluntary members at a higher rate than the employed rate, will not be treated as having become employed members. If, however, they become regularly employed persons, they will be insured as such for what the contri- butions which they pay, or have paid, are worth. (3) Non-payment of Contributions due to various causes (3) Non-payment of contributions by employed persons will be dealt with as follows : (a) Sickness Non-payment due to sickness will be disregarded. (b) Unemployment Non-payment due to unemployment not amounting to four weeks a year on average will be disregarded. Beyond this sickness benefit will be reduced or postponed, but if the non-payment ex- ceeds thirteen weeks a year on average the member will be suspended from benefits. (c) Voluntary Members Voluntary members who fall into arrear will be dealt with specially. (d) Members in Arrear Members in arrear will be given the right to pay arrears of contribution which have occurred in the current and previous calendar year with interest at 3 per cent. The societies will be pro- tected against such payments being made when sickness has commenced, or just before it, with a view to ob- taining full benefit, and a period of one month has been proposed as a protec- tion against abuse of the insurance in such cases. Persons who Enter or Re-enter Late in Life Immigrants coming on to the scheme late in life will be compulsorily insured for the proportion of the benefits only which their own and their employers' contributions are worth. It has seemed necessary to provide that other per- sons who are driven into employment late in life, or who re-enter after ex- clusion, should be insured for reduced benefits ; they will, however, be given a minimum insurance of not less than 55. a week, corresponding with the insurance granted to a person who is in the maximum amount of arrears, even if the employed rate is not suffi- cient to grant this minimum insurance, and the society accepting such a mem- ber will be given credit by the Govern- ment at the expense of the whole insurance for the deficit caused by so accepting him according to the tables which will be prepared. It may be pointed out that, if such persons were given the full insurance, they would be treated as well as people who had pre- viously insured themselves voluntarily, 44 THE PEOPLE'S INSURANCE and better than employed persons of the same age who were to any extent in arrear with their contributions. The amounts previously paid by way of voluntary insurance by any person coming- on to the scheme late in life as an employed person will be credited to his insurance. Exception with Persons Educated after 16 An exception will be made in favour of persons whose education is con- tinued beyond 16. 5. THE MACHINERY FOR THE DISTRIBU- TION OF BENEFITS. The machinery will consist of (A) Approved societies. (B) A post office system, set up by the Government for the benefit of those persons who fail or neglect to join a society, or are rejected. (A) APPROVED SOCIETIES. The conditions of approval com- prise : Conditions of Approval (1) Absolute self-government. (2) Not working for a profit. (3) Election of all committees, re- presentatives, &c., by the members in accordance with rules approved by the insurance office or regulations drawn up under the Act. (4) A minimum number of 10,000 in- sured persons under the Act. (5) Local as well as central control of arrangements for medical attend- ance and payment of sickness benefit and appeals. For all questions arising under the Act societies will be required to provide for a final appeal to arbitra- tors appointed by the insurance offices. (6) Giving security by the deposit of sufficient stock or in some other way to compensate the Government for any malversation by officers. (7) Keeping separate accounts for the State scheme. (8) Complying with the provisions and requirements of the Act. Open to any Society Satisfying Condi- tions to become Approved It will be open to any Society which satisfies the conditions to become an approved society, and it will not be asked to apply any of its existing funds for the purposes of the new scheme, even though they have been contri- buted in respect of benefits now in- cluded in that scheme. Ability of Friendly Societies and Trades Unions to become Approved All the great friendly societies and trades unions will be able to comply with these conditions. By doing so they will not sacrifice their independ- ence or their right to select members. The Government inspection and super- vision to which they will be liable is only devised in the interest of the mem- bers themselves to secure the proper administration of the funds, and should strengthen the position of the managing committees in well-managed societies. Particulars as to Minimum Number of Insured Persons Under the heading (4), the minimum of 10,000 has been adopted for Great Britain, 5,000 for Ireland ; * but this number will not apply to superannua- tion funds established by employers. It may be explained that a fairly high number is necessary to prevent an un- reasonable number of cases occurring in which further levies from members * The numerical limitations were abandoned. THE PEOPLE'S INSURANCE 45 might prove necessary, putting em- ployers and employed to considerable inconvenience. As only one employer is concerned in the case of a super- annuation fund, it makes less difference in such a case if a levy is necessary. Societies which Join an Association It should be added that societies which do not contain the prescribed number, 10,000, will be able to join or form an association or society of socie- ties containing that number. The terms of such association must be that the societies forming it agree to con- form to the conditions subsequently laid down for dealing with surpluses and deficits. Societies which are mem- bers of such associations (whether existing or to be formed) will apply for approval and give security through the central body of the association. Such associations must make provision in their rules for settling disputes and for the government of the association, and it is clear that societies forming such associations will be able to maintain a stronger independence through the*ir associations than they could maintain separately. Local as well as Central Control Under the heading (5) societies which are managed by delegates, or where voting by proxy or by post is permitted, and which carry on business at a distance from their head offices, will be required to set up local com- mittees elected by all the members of the society residing in the district, for determining claims and supervising the administration of benefits in the dis- trict. A district has been defined as "a locality in which there are 1,000 members in the State insurance," and societies are required to set up a com- mittee for every 1,000 members as a maximum, and further required upon a request of 50 members to set up a committee for every group of 250 mem- bers as a minimum not more than 3 miles distant from the nearest branch office. Places of Meeting Power has also been taken to pre- scribe the place of meeting of societies. Giving Security Under heading (6) the Government will be given power to require security by the deposit of sufficient stock out of the funds of societies and to refuse approval to a society that is not pre- pared to make a deposit of stock up to the amount of half the annual contribu- tions of the members of the society in the scheme. Security will also be accepted in other forms at the discretion of the insurance office. The Requirements of the Act with which Approved Societies must Comply. (1) To keep their books and ac- counts, so far as relates to the State scheme, in the form to be prescribed by the Committee with the approval of the Treasury. (2) To submit all such books and accounts to Government audit when required. It is proposed that the Government should undertake the work of auditing the State funds. (3) To submit to a Government valuation at intervals of three years or at such other intervals as may be appointed. (4) To conform to the requirements of the Act in the event of any surplus or deficiency being shown on a valua- tion. THE PEOPLE'S INSURANCE (5) In the case of societies which are members of an association, to remain members of the association to which they belong, unless secession or dis- solution is sanctioned as specified later. (6) To provide for an appeal to arbitrators appointed by the insurance office in the event of any dispute be- tween societies or between members arising out of the operation of the Act. (7) To conform in other respects with the provisions of the Act. Special Provisions re Superannuation Funds established by Employers. All Requirements of Acts (with one exception) will apply All the requirements of the Act, except those regarding the minimum number of 10,000 members, will apply to such funds, if they are to be given the privileges of approved societies. Employers' Deductions A special provision has been inserted authorising employers, subject to the qualification mentioned below, to deduct an amount equivalent to the contribution to be made by them under the Act from any future contribution which, by existing Act or deed, they have bound themselves to make to benefits similar in kind to those pro- vided by the Bill. Such alteration of the effect of any existing Act or deed will only take effect as from the date when the present Act comes into opera- tion, and all rights, titles, and benefits to which members have in any way become entitled under the present con- stitution of such funds before that date will be preserved. The deduction will be required to be limited according to such an amount as can be made con- sistently with the maintenance of such rights, titles, and benefits. Members' Votes on Modifications of Existing Rules Members of such funds will be given the right of voting on any modifica- tion of existing rules proposed under the preceding paragraph, and all modi- fications of existing schemes will be submitted for approval. Any member of such a fund will be given the right at any time to transfer his subscription and his employer's share with it to another society, if he prefers to be in- sured in that way, and the fund will carry out the transfer as a transfer between societies in the manner speci- fied below. Employers' Representation It has been necessary to deal with the question, of the employer's repre- sentation in the management of such funds, and a clause has been inserted allowing the employer one-fourth re- presentation if he makes himself re- sponsible for the solvency of the fund, and excluding him from representation in other cases, except to the extent to which he contributes more than the proportion represented by the amount payable by him under this Act. Membership of Societies. Transfers between Societies Subject to the provisions of the Bill, membership will be governed by the existing rules of friendly societies. Transfers from one society to another will be carried out by the transfer of the amount appropriate to the mem- ber's age, according to a table which will be prepared, subject to appropriate deductions in the event of the member being in arrear or the society being in deficiency. THE PEOPLE'S INSURANCE 47 Expulsion of Members A clause has been inserted, requiring a society which expels a member, who is unable to find another society to take him, to pay over to the insurance office the money appropriate to the member's age. Expelled members will be given a right to appeal to the insurance office arbitrators. Management Expenses. The contributions are calculated to cover management expenses. A separate account must be kept for management expenses, and the Government will contribute its propor- tion of such expenses. Emigrants. Reciprocity Agreements Members will be entitled to a trans- fer to a colonial society at the usual transfer rates. The insurance office will compile a list of colonial societies approved for the purpose, who grant reciprocal treatment to their own mem- bers migrating to this country. A clause will provide for reciprocity with colonies and foreign countries having State schemes of insurance. Persons in receipt of permanent sick allow- ances going abroad without the con- sent of their societies will forfeit benefits. Investments. Investments and Availability of Funds Any sums standing to the credit of a society will be invested by the Government through the National Debt Commissioners. These funds will be available for making loans under the Housing Acts. Equalising Conditions as between Societies accepting Members of Different Ages. Inasmuch as societies will be allowed to retain their own independ- ence and carry on business in the method to which they are accustomed, some arrangements must be made to equalise the position as between socie- ties consisting of old or of young mem- bers. If there were only one fund and one society no difficulty would arise. The age-distribution of such a society would be normal at the commence- ment and as it would get its full and proper proportion of new entrants it would remain normal throughout. But as it is, there are over 20,000 societies and branches with the greatest possible variety in age-distri- bution. Reconstitution of Societies not Proposed It is not proposed to break up and reconstitute these societies, nor is it desirable or necessary to do so. But it is necessary to put every society on exactly the same footing : (1) For the purpose of the State valuation. (2) As regards its financial position if it takes the older lives into insur- ance. This has been effected in the follow- ing way : Inasmuch as the State is covenant- ing to pay two-ninths of the benefits for men (one-fourth for women), every society will necessarily be in a solvent condition if it has seven-ninths for men (three-fourths for women) of the con- tribution necessary as regards mem- bers joining it at the age of 16 the age when the insurance commences, and as from which all calculations for the purpose of the insurance have been THE PEOPLE'S INSURANCE made. For members joining at any age over 16, societies in order to be solvent should also hold seven-ninths for men, and three-fourths for women, of the reserves appropriate to the members' ages. The Working of the Paper Debt These reserves they will not, of course, hold at the commencement of the scheme, and it is therefore necessary to create them in the form of a paper debt, at the cost of the whole insurance. This debt will be credited to the various societies, and will carry interest in the accounts at 3 per cent. Debt and interest will be redeemed by the investment of two- ninths for men (one-fourth for women) of the contributions paid by insured persons. In this way every society is put upon an equal footing of solvency as regards the acceptance of members. If a society has an age-distribution of members which is exactly normal in accordance with the calculation of the Government's actuaries, the reserves credited to it in the form of the paper debt would be paid off by the invest- ment of the two-ninths (and one-fourth) of the contributions. If a society ad- mits younger members, the excess of their contributions is available to pay the debt credited to a neighbouring society which admits older members. No one society, therefore, can get an advantage over another society by ad- mitting members at the younger or older ages. Reasons for Imposition of Age Limit The proportion of the contribution which societies have to surrender is the proportion represented by the Govern- ment grant of two-ninths (or one- fourth) of the benefits. It is true, therefore, at the commencement that young persons of 16 years of age in fact get no value from the Govern- ment grant, for the Government pays two-ninths (or one-fourth) of the bene- fits and takes two-ninths (or one-fourth) of the contribution. But for every age over 1 6 the society to which every in- sured person belongs from the com- mencement receives in the insurance a credit appropriate to his age-risk carry- ing interest at 3 per cent., and this credit represents the value to him and his employer of the Government insur- ance. The credit is, of course, greater at the higher ages, and it is for this reason that a somewhat reduced insur- ance is given to persons over 50 years of age and that persons over 65 are excluded. Increased Benefits to Youth after a Certain Period has Elapsed It is impossible without great com- plications under a universal scheme of insurance with a uniform rate of premium to devise a scheme under which every insured person from the commencement would receive exactly equal treatment. Equality of treat- ment can only be reached when the original deficit due to the inclusion of the older lives has been wiped off. Meanwhile, under the provisions of the Bill the younger generation will re- ceive the full value of their own and the employers' contribution, and it is proposed in the Bill that when the deficit has been wiped off, and it be- comes possible to extend the benefits conferred by the insurance, regard in the extension should be had to their ages when they joined the insurance. The value of the promise thus made to the younger generation is shown in the financial statement which will be circulated. THE PEOPLE'S INSURANCE 49 The 3 per cent. Basis It should be added here that the Bill proposes that the insurance fund should be rolled up by the operation of the provisions above explained until it is sufficient to provide interest at 3 per cent, on all amounts then standing to the credit of societies. The advan- tages of this proposal are that it en- ables all valuations meanwhile to be conducted on a 3 per cent, basis, and that it makes a capital valuation of the fund unnecessary. When the scheme is extended, Parliament will be able to make such arrangements as may be reasonable for dealing with the capital account or changing the rate of interest adopted for valuation purposes. Valuation of Societies. (A) Surpluses. Societies with Surpluses Entitled to Prepare Schemes for Granting Additional Benefits If a surplus is found upon a valua- tion of a society, which is not a mem- ber of an association of societies, the society will be entitled to prepare a scheme for granting one or more of the additional benefits specified in the Act. The consent of the insurance office will be necessary before such a scheme can be brought into operation. A Like Principle in Dealing with Associations If a society showing a surplus is a member of an association of societies, it will be required to transfer one-half of any surplus to the central fund of the association, and with the approval of the association and of the insurance office it will be entitled to introduce one or more of the additional benefits. An association of societies will be en- titled to introduce additional benefits for all its branches, when its central fund is sufficient for the purpose, sub- ject to the consent of the insurance office. (B) Deficits. Societies with Deficits Required to Prepare Schemes for Extinguishing Deficiency If a deficiency is found, the society will be required to prepare a scheme for extinguishing the deficiency. Such a scheme may provide for (a) A levy upon all members of the society. (&) A reduction of the temporary sickness benefit. (c) A postponement of sickness bene- fit, or an extension of the period of twelve months mentioned above be- tween payment of full sickness benefit. All such schemes must receive the approval of the insurance office. Proceedings if such Society is Member of an Association If a society with a deficit is a mem- ber of an association, the deficiency must in the first instance be made good from any surplus in the hands of the association ; but the governing body of the association, if it alleges malad- ministration on the part of the branch society, will be entitled, subject to an appeal to the insurance office, to re- fuse to make any grant from surpluses. Powers of the Insurance Office as regards Societies with Deficit If within six months after the de- claration of a deficit no such action should be taken as may be reasonably expected to make good the deficiency in the affairs of the society within a period of three years, the insurance THE PEOPLE'S INSURANCE office is empowered and required to take over the administration of the statutory powers and funds of the society and to take steps to recover as quickly as possible the amount of the deficiency by any or all of the methods above indicated. For the purpose of these clauses further contributions will be enforced if necessary by a deduction from wages as indicated below. Mem- bers joining 1 a society in which a defi- ciency has been declared after the de- claration of the deficit will not be required in any way to make good such deficit. Members leaving a society in similar circumstances will be charged with their proper pro- portion of the deficit. Any dispute as to the amount of the deficit or as to the adequacy of the provision proposed for extinguishing it will be decided by an independent referee to be appointed by the Lord Chief Justice in England and Ireland, and the Lord President in Scotland. If a society is found to be in deficiency at any time after the approval of a scheme for granting additional benefits, payment of such additional benefits will be sus- pended. Excessive Sickness in Certain Trades, &c. Circumstances which Warrant Inquiry, and Penalty of Employer If one or more societies allege that excessive sickness has been caused among their members by the conditions or nature of employment in some trade or trades, or in certain shops or fac- tories in which their members are em- ployed, they will be entitled to demand an inquiry into the conditions of the trade, shop, or factory. If it is found on such inquiry that there has been among members of the societies en- gaged in the particular trade, shop, or factory concerned during a period of not less than three years an amount of sickness exceeding by ten per cent, the average expectation of sickness, as shown by the table which the Trea- sury will publish for the use of persons making valuations under the Act, the employer will be required to make good the extra expense incurred by the so- cieties through such excessive sickness. This provision will, of course, ex- clude any sickness or disease which is a subject of compensation under the Workmen's Compensation Act. Excessive Sickness in any Locality. The powers of societies as regards such sickness will be defined later under the heading "Local Health Committee." New Societies, Secessions, Power of Opening New Branches The orders and associations will have the power now given to them by the Friendly Societies Acts of opening new branches. Such branches will give security through their order or associa- tion. Conditions for Formation of new Societies New societies which are not branches of existing societies may only be opened upon the insurance office being satisfied with the security offered, and upon the necessary minimum number of mem- bers being enrolled. Conditions for Dissolution of Approved Societies Dissolution of an approved society will only be allowed with the consent of the insurance office, proper provi- sion being made for the State members. THE PEOPLE'S INSURANCE Secessions from Orders and Associations. The present law will apply. Affili- ated societies may only secede after complying- with the terms of their agreement with the order or associa- tion to which they belong. The further condition will be imposed that 'the consent of the insurance office will be necessary. Withdrawal of Approval. The insurance office will be given the right to withdraw approval from any society failing to comply with the pro- visions of the Act, or of any Act re- gulating its constitution. The funds of any such society will be used to pro- vide, so far as they will go, for the transfer of the members to other socie- ties or to the Post Office insurance. (B) THE POST OFFICE DEPOSIT INSURANCE. Applies to Persons not belonging to a Society Persons liable to the compulsory de- duction from wages, who fail to join a society or who are rejected or expelled by a society and who cannot get another society to take them, will be dealt with through the Post Office. Their names and addresses will be ascertained and the insurance will be conducted as follows : Method of Insurance through Post Office The cards first issued for the collec- tion of contributions (see later) will be made current for a period of four or five months only. After that period new cards will be issued free to mem- bers through the societies and to other compulsorily insured persons through the Post Office upon the name and ad- dress being furnished. A membership book, upon which credit will be given for contributions, will be issued with the card to persons joining the Post Office insurance, and the contributions will be charged annually with seven- ninths for men and three-quarters for women of the calculated cost for management, medical attendance, and sanatorium. A waiting period of fifty- two payments will be required before any contribution can be withdrawn, but the member will be entitled after six months to medical attendance. If, after the waiting period has expired, a member falls ill, he (or she) will be entitled to withdraw his (or her) con- tributions including the employer's share with the addition of two-ninths (or one-quarter) from the State's con- tribution, at the rate of ios., 75. 6d., or 55., &c., a week as the case may be. After the expiration of three years, if the funds admit, a further addition from lapsed and forfeited contributions will be made to the amounts withdraw- able by members in sickness. Lapses or forfeits xvill occur by the member dying. The Post Office insurance will in- clude foreigners, no State grant being given in such cases. Medical attendance for persons in the Post Office insurance will be provided by a Local Health Committee to be set up as follows : THE LOCAL HEALTH COMMITTEE. In connection with the proposals for the Local Health Committee, it should be stated that the areas of these com- mittees will not be quite the same in Scotland as in England, and that most of the provisions relating to these com- mittees will not apply to Ireland. THE PEOPLE'S INSURANCE Formation of Local Sub-Committees of Health A committee will be formed for counties and county boroughs, with power to create local sub-committees so far as necessary. It will consist : (1) Of persons nominated by the county councils or county boroughs, some of whom must be members of the sanitary authorities. (2) Of persons nominated by the approved societies. (3) Of persons nominated by an association, if any such is formed, of persons who insure through the Post Office, or in default of such nomination by co-option of such persons. (4) Of persons appointed by the in- surance office, two of whom will be doctors. The insurance office nominees will join in the co-option of persons ap- pointed under heading (3). The county or borough medical officer will be entitled to attend the meetings of the Committee. The insurance office is given power to vary the proportions of the repre- sentatives upon the Committee, and this power might prove of considerable importance in the event of agreements for the transfer of medical attendance being entered into as explained later. Duties of Committees in Ireland In Ireland, the duties of these Com- mittees will be given to the county councils (outside the large towns), and the councils will also have power them- selves to undertake to establish socie- ties. In counties where there are many Post Office contributors, arrangements are permitted for creating a separate Post Office account. Duties of Health Committees. (1) Medical 1. To make medical arrangements for persons who have been rejected by or failed to join a society. (2) Sanatoria 2. To control the whole of the ex- penditure of insurance money for sana- toria in the district. Patients .will be required to be sent to sanatoria ap- proved by the Local Government Board, either existing or to be built with the help of the Government grant of ;i, 500,000. (3) Public Health 3. To consider the needs of the dis- trict from the point of view of public health, to demand inquiries as to the enforcement of the Public Health Acts, the Factory Acts, and the Mines Acts, and to make recommendations. If, as the result of an inquiry, any excessive sickness is found to be due to bad housing, insanitary conditions, &c., the cost of such sickness is to be paid to the approved societies and the Health Committee by the local authorities. Insanitary Housing Conditions Where an inquiry is ordered into in- sanitary housing conditions in a neigh- bourhood, power will be given to the local authority to summon owners of insanitary property before the Commis- sioner holding the inquiry as third parties with a view to passing on to them the whole or a part of any levy due to excessive sickness. The inquiry will be held before a Commissioner or Commissioners ap- pointed by the Government Depart- ment concerned in each case. The power given to Health Com- mittees to protect their members in THE PEOPLE'S INSURANCE 53 cases of the kind mentioned is a neces- sary counterpoise to the liability im- posed on members to make good the cost of excessive sickness, for it is not fair to call on them to make good the cost of sickness caused by the neg- ligence of other persons. Power will also be given to the societies separately to demand in- quiries into the above matters. (4) Lectures, etc., on Public Health 4. To provide for lectures and the publication of information upon ques- tions relating to health. Local Health Committees will be given power to combine for common purposes, and the insurance office will be empowered to form joint commit- tees for neighbouring counties in special circumstances. Transfer of Medical Attendance to Health Committee. Present Unsatisfactory Condition of Medical Belief under Friendly Societies The present system of medical relief as organised by the friendly societies cannot be regarded as entirely satis- factory. Doctors employed by these societies are paid an inclusive fee of about 45. per member on an average. This fee covers drugs and the cheaper medical appliances, but is insufficient to provide the more costly drugs, the cost of which has to be borne by the doctors themselves. Correction in respect of Payment for Drugs To correct this it is proposed to insert a clause forbidding the societies to enter into any contract which pro- vides for the payment of drugs by an inclusive fee. This will involve a sub- stantial increase in the cost of medical relief, but the funds at the disposal of the societies under the Bill will enable them to meet the additional expense without trenching upon the minimum benefits. Optional Handing Over by Societies of Medical Relief to Health Committee Further, the societies will be given the option of handing over this part of their duties to the Health Committee, on such terms as may be arranged in each case. If the terms arranged or proposed involve a deficit, the Health Committee will be authorised to apply to the Government and the local authority for the payment of the deficit in equal shares; the latter can well afford it, for the scheme must effect a considerable saving in the medical charges now falling on the rates. It must be remembered in this connection that the compulsory character of the scheme secures a contribution towards medical attendance from that class of the population who now, having no society to fall back upon in case of sickness, resort to the Poor Law both for medicine and maintenance. Inspection of Societies Medical Relief The medical treatment given by societies will be made subject to in- spection. Income. This will consist of : (1) The proportion charged to Post Office members in the district to cover medical attendance, management, and sanatorium, with the addition of the State grant. (2) The whole of the sanatorium money from approved societies. (3) The societies will also be re- quired to subscribe id. or 2d. per 54 THE PEOPLE'S INSURANCE member per annum towards the ad- ministrative expenses of the Com- mittee. Provision for Research (4) The State will make an additional grant of id. for every is. 3^. of the sanatorium money, and it is proposed to take power to use the whole or part of this additional grant for research purposes. Power will be given to local authori- ties to subscribe to the general pur- poses of the Committee. 6. COLLECTION OF CONTRIBUTIONS. The system to be provided for is as follows : Duties of the Employer The employer of any person liable to deduction from wages is to be respon- sible for paying that person's contribu- tion as well as the employer's contri- bution in respect of him, and may recoup himself the amount of the former contribution (but not of the latter) by deductions from the in- sured person's wages. Such a deduc- tion will only be allowed at the time when the wages are paid for the period for which they are paid. If the em- ployed person is not paid by the person employing him but by other persons, the employer will be responsible for seeing that he is insured. If the em- ployed person gets no wages from any- body, then the employer must himself pay the whole amount. Deductions not made at the proper time cannot be made from any later payment. When an employed person is out of employ- ment or ill, the contributions are not required to be paid. Method of Payment of Contributions The payment of contributions is to be effected by means of adhesive stamps which the employer will be able to obtain at any post office and affix to a card belonging to the employed person. The stamps must be cancelled by writing the date across them. The insured person will be responsible for obtaining the card and producing it to the employer to be stamped. On enter- ing employment he may hand over his card to be kept by his employer, but if that course is followed, the employer must deliver the card back to him after a prescribed interval stamped up to date. When the card is in this man- ner left with the employer, the em- ployer will be saved the trouble of stamping the card every week. Method in respect of Casual Trades To secure the due payment of con- tributions in the case of casual trades and employments, it is laid down as a general rule that the first employer in the week should be responsible for the payment of the contributions. The employee will be freed from further deductions from wages in the same week by producing his stamped and dated card to any subsequent em- ployer. The inclusion of casual labour in insurance is of great importance. If it were excluded, it would tend still further to increase. Penalties The following penalties will be pro- vided for : (1) The employer to be liable to civil proceedings for damages caused by failing to insure an employee. (2) The employer also to be liable on summary conviction to a penalty for every omission to stamp a card, or for THE PEOPLE'S INSURANCE 55 holding a card which he has not stamped at the prescribed intervals, and the card will be stamped at the employer's expense. The workman is to be required to produce his card to his employer at the time when wages are paid, and, if he omits to do so, then the employer will be empowered and required to obtain a card for him. The whole of the above provisions left to regulations. A general explana- tion of the method to be adopted has been inserted here so as to make clearer the intention of the provisions of the Bill. Employee cannot Contract for Deduction from his Wages of Employer's Share A clause has been inserted to provide that any covenant between employers and employed, under which the em- ployed agrees to the employer's de- ducting from wages the employer's share of the contribution, shall be void and of no effect. Card remains Property of Employee The card will be made the property of the workman, the employer having no right to retain it without his con- sent, or to write any comment what- ever upon it. Provisions for Casual Labour Subject to the general rules laid down above, power will be taken to make regulations dealing with the con- tributions of casual labourers, includ- ing persons who are habitually em- ployed by the hour or day, or for periods less than a complete week, and persons who are employed by several employers in one week. It will be permissible under these regulations for a group of em- ployers who between them employ a group of casual labourers, or for a group of casual labourers themselves, to deposit the casual labourers' cards with an insurance officer or at a Labour Exchange or some other suitable agency, to which the money for the contributions would then be paid. The Purpose of the Cards The cards will be made current for a fixed period, and will be handed over at the end of the period by the insured person to his society or to the Post Office, and he will receive a new card in exchange. The stamped card be- comes a voucher furnishing evidence that the contributions have been duly paid as it passes first from the em- ployer to the insured person, then from him to his society, and finally from the society to the Post Office or the de- partment having custody of the insur- ance funds. MISCELLANEOUS QUESTIONS. (a) Advisory Committee The Bill will contain provisions for the setting up of a committee of em- ployers and insured persons whose duty it will be to advise the insurance office. (b) Double Insurance A clause has been inserted prevent- ing, under a penalty, double insurance in the State scheme, and the same person will not be able to draw both unemployed and sick benefit. Mem- bers will, of course, be entitled to make what further insurance they may desire voluntarily through their socie- ties, or in any other way. THE PEOPLE'S INSURANCE (c) Inspection, Insurance Office, etc. A clause will be inserted giving the Government the right to appoint inspectors for the purpose of the Act, and to establish an office for the pur- pose of dealing with all matters arising under the Act, the audit and valua- tion of accounts of societies, invest- ments, &c. Inspectors and officers of the insur- ance office so constituted will be given wide powers as regards all matters re- lating to the collection of qontribu- tions, and as regards conducting in- quiries into the affairs of the societies. (d) A Penalty Clause against False Claims, etc. A clause will be inserted to protect the Government against false claims by officials of societies, frauds in the Post Office insurance, and misuse of stamps or caHs; and to protect societies against frauds by officials or members. Existing Acts will be applied as far as possible to this purpose. Offences in connection with the pay- ment of contributions have been already dealt with. (e) Out-door Belief The existing Act with regard to benefits payable by friendly societies and outdoor relief granted by guar- dians will be made applicable. (f) Ejectment, etc. A clause will be drafted suspend- ing the execution of all process for ejectment or for rent or debt against an insured person during the period he or she is in receipt of sick pay under benefit (c) and for 14 days after the expiration of such period. Extension of Period of Protection in case of Sickness Power will be given to the Judge or Registrar of the County Court to ex- tend the period of protection in case of sickness, in no case beyond 12 months without a guarantee for the rent, if he is satisfied that life would be imperilled.* . Malingering. Purely State Scheme of Insurance would foster Malingering The greatest evil which has to be guarded against in all benefit schemes of this character comes from the danger of malingering. The friendly societies have never been able to sup- press it altogether, and no plan which human ingenuity can devise will suc- ceed in stamping it out. The best that can be achieved is the compression of it within limits that will not substan- tially disarrange or affect the funds available for honest men. The most effective check in fact, the only really effective check upon malingering is to be found in engaging the self-in- terest of the workmen themselves in opposition to it. That is why a purely State scheme, where the Exchequer could be drawn upon to an unlimited extent, would inevitably lead to un- limited shamming and deception. This scheme is so worked that the burden of mismanagement and maladministra- tion would fall on the workmen them- selves. If, through any such cause, there is any deficiency, the workmen must make it up either in diminished benefits or increased levies. Once they realise that, then malingering will become an unpopular vice amongst them, and they xvill take the surest and shortest way to discourage it. * These provisions were modified. See section 68 of Act. THE PEOPLE'S INSURANCE 57 B. INSURANCE AGAINST UNEMPLOYMENT. The scheme of insurance against un- employment embodied in Part II. of the National Insurance Bill provides for : (a) Compulsory insurance in certain scheduled trades. (b) Encouragement of voluntary in- surance in all trades. The scheme applies compulsorily to all workmen, skilled or unskilled, organised or unorganised, in building, construction of works, shipbuilding, engineering, and construction of vehicles. That is to say, on the one hand, all workmen and their employers are liable to contribute to an unem- ployment fund in respect of employ- ment in these trades, and, on the other hand, all workmen who have thus con- tributed are entitled when unemployed to certain payments from the fund. The definition of the term " workman " is such as to exclude foremen and clerks as well as all persons under 18 years of age, and power is given to the Board of Trade by regulations to define more exactly than can be done in the Sixth Schedule the precise scope of the scheme. Workmen under the Crown, unless they are estab- lished, i.e., pensionable, are included, but power is taken to adapt the provi- sions of the scheme to their special cir- cumstances. Method of Collection of Contributions The income of the unemployment fund is raised by contributions from a Wkmen, employers, and the State. \\ The workman's contribution is 2%d. for each period of employment of a week or less, and the employer's contribution is also 2%d. for each period of employ- ment of a week or less, subject to the provision for compounding described below. The State contribution to the unemployment fund is one-third of the total contributions from workmen and employers. The State is respon- sible in the first instance for the cost of administration, but 10 per cent, of the income of the unemployment fund will be paid over in aid of administra- tive expenditure. The workman's and employer's contribution will, as a rule, be paid together by the employer's purchasing a special insurance stamp and affixing it to an insurance book carried by the workman. That is to say, it will in general be illegal to employ any workman in the insured trades without obtain- ing from him an insurance book and without affixing thereto week by week a $d. stamp to represent the joint contribution. An employer who has affixed a stamp in this way will be en- titled to deduct half the value of the stamp from the workman's wages. No contributions are required while the workman is unemployed for any cause. The benefit provided consists of weekly payments to the workman whilst unemployed provided that he fulfils certain statutory conditions and is free of certain disqualifications. The statutory conditions are, that the workman should have been employed in an insured trade for 26 weeks, should c THE PEOPLE'S INSURANCE have made application for benefit in the prescribed manner and have been continuously unemployed since the date of application, should be capable of work and unable to obtain suitable em- ployment, and should not have ex- hausted his right to benefit. Conditions under which Benefit is Withheld Notwithstanding the fulfilment of the statutory conditions, a workman may be disqualified for receiving benefit on the following grounds for the period stated in each case : (a) If he has lost employment through a strike or lock-out, for so long as the strike or lock-out continues ; (6) if he has lost employment through misconduct or has voluntarily left employment without just cause, for six weeks from the date of losing or leav- ing employment; ~~ (c) if he has been imprisoned, for a period of six weeks after leaving prison ; (d) while he is an inmate of any public institution; (e) while he is resident temporarily or permanently outside the United Kingdom. Amount and Duration of Benefit No benefit will be paid for the first week of any period of unemployment. Thereafter benefit can be drawn at the rate of 75. a week by workmen en- gaged in engineering, shipbuilding, and construction of vehicles, and 65. a week by workmen engaged in house building- and works of construction, up to a maximum in each case of 15 weeks of benefit in any 12 months. It is pro- vided in addition that not more than one week of benefit can be drawn by any man for every five weekly contributions paid by him. This rule, while it will not be felt by men who work steadily in youth and only make large claims on the fund in ex- ceptional trade depressions or in their later years, will drastically exclude from benefit men who are incompetent or idle. The same rule provides also an automatic means of dealing with the claims of those who work only part of their time at an insured trade. Such men will get a correspondingly reduced claim upon the fund. Special provision is made to prevent the rule from operating hardly in the case of work- men already working at an insured trade before the commencement of the Act. Variations in Rates of Benefit The rates and periods of benefit men- tioned above are those proposed in the first instance. Power is given, how- ever, to the Board of Trade by regula- tion to vary the rates within certain limits (viz., 6s. and 8s. per week), and, if necessary, to reduce the period below 15 weeks. For larger variation in the rates, or for an extension of the period, or change in the proportion which total benefits may bear to total contribu- tions, more elaborate procedure, in- volving a public inquiry and hearing of objections, is required, on the lines of the procedure for making special orders under the Factory Acts. All such changes may relate either to the insured trades as a whole or k single trade or branch thereof. THE PEOPLE'S INSURANCE 59 Administration of the Scheme The administration of the scheme will take place principally through the Labour Exchanges. That is to say, a workman leaving employment will take his insurance book duly stamped to date to the nearest Exchange and lodge it and claim benefit. The decision as to how much benefit, if any, he may draw will be made by a statutory officer known as an "Insurance Offi- cer." The workman will be entitled to receive such benefit as the insurance officer allows, subject to his remaining unemployed and continuing to sign the register daily during working hours. Court of Referees If the workman is dissatisfied with the decision of the insurance officer in any case, he will have a right of ap- pealing to a Court of Referees, consist- ing of one or more members from a panel of persons chosen to represent workmen, with an impartial chairman. It is contemplated that Courts of Re- ferees should sit in convenient centres once a week, and should deal each week with the whole of the appeals, so that there should be no delay in deciding cases. No charge will be made to the workman for appealing to a Court of Referees, and if sent for to attend he will receive travelling .expenses. If the Court of Referees and the in- surance officer are in agreement on any case, their decision will be final; if they differ, there will be a further appeal to an umpire appointed by the Board of Trade, whose decision will be final and conclusive. The appeal to the umpire will serve to harmonise the principles on which Courts of Referees and insur- ance officers decide cases. Districts not covered by Labour Exchanges will be dealt with through local offices in the nature of sub-post offices. Two Main Principles The foregoing paragraphs set out the framework of the compulsory scheme. There are, however, a number of sub- sidiary provisions which will be best understood by reference to two main underlying principles : (1) That provision for unemploy- ment, whether through insur- ance or in other forms, must not be such as to create unemploy- ment, and should, if possible, tend to diminish unemployment; (2) That compulsory provision for unemployment should be accom- panied by arrangements for pre- serving and encouraging volun- tary provision. DIMINUTION OF UNEMPLOYMENT. As regards the first principle the avoidance of any tendency to encour- age or increase unemployment by pro- viding for it attention may be called to the following points. Close Alliance with Labour Exchanges In the first place, provision for un- employment through insurance is throughout closely linked up with the machinery already established for diminishing unemployment, namely, the Labour Exchanges. Workmen claiming unemployment benefit through V C 2 6o THE PEOPLE'S INSURANCE an Exchange will automatically be registered as applicants by the Ex- change for employment, and if the Exchange can find them suitable work, they will be required to take that work in place of drawing benefit. They will no longer be held to be "unable to obtain suitable employment." The in- surance scheme, it is hoped, will greatly increase the efficiency of the Exchanges, first by bringing to them all the unem- ployed workmen who apply for benefit, and second, and consequentially, by in- ducing employers to send to them for the men who will necessarily be there. It is to the Interest of all Parties to Diminish Unemployment In the second place, the burden of providing benefit is thrown upon work- men, employers, and State in such a way as to give each of these parties an interest in diminishing unemployment, i.e., preventing unnecessary idleness with a view to diminishing the burden. The benefits of the scheme are not guaranteed by the State. It is neces- sary, indeed, to make some provision for the possibility of an exceptionally severe depression of trade which might exhaust the fund temporarily, and this is done by allowing the Treasury to make an advance. It is provided, however, that in the event of such an advance being made there may be required by the Treasury an immediate temporary modification of the rates of contribution, or of the rates and periods of benefit, such as may serve to repay the advance and restore the solvency of the fund. Further, if it is found over a period of years that the rates of contri- bution are either too low or too high in view of the benefits given, it is con- templated that there should be a periodical revision of these rates, and that in such revision there should, if necessary, be a differentiation between different trades and branches of trades according to the unemployment re- corded in them. In this way it is made to the interest of both employers and workmen to reduce un- employment, if they can, with a view to obtaining a reduction or avoiding an increase of contributions when the re- vision takes place. The periodical revision of contributions requires a special order, made after public inquiry and hearing of objections, and Can only be undertaken at intervals of five years or more. The contributions of em- ployers or workmen cannot be raised by such a revision by more than one penny per workman per week. Provisions to Encourage Regularity of Employment In the third place, a number of specific provisions are inserted in the Bill with a view to encouraging regularity of employment or otherwise diminishing the burdens on the fund. (a) A minimum contribution of 2\d. each is required from em- ployers and workmen for every separate period of employment of a week or less. In this way the premium for insurance is to some extent automatically adjusted to the greater risk, in so far as casual workmen and their em- ployers are required to pay more frequent contributions than the THE PEOPLE'S INSURANCE 61 more regular workmen and their employers. (b) Any employer, in place of paying in each week the joint contribu- tion of 5^. as it becomes due in respect of any particular work- man, may pay in advance at a rate of 155. for that workman for the whole year, continuing to deduct from the workman the ordinary contribution for each week of employment. This rate represents a substantial reduc- tion of the employer's contribu- tions. (c) Any workman may at the age of 60 (or, in the case of men who have finally left the trade, at the age of 55) recover from the un- employment fund the amount, if any, by which his own contribu- tions (exclusive of those of the employer and the State) exceed the amount of benefits drawn by him from the fund, with com- pound interest at 2\ per cent. (d) In the case of workmen put on short time during a period of trade depression, the contribu- tions both of employers and of workmen may be remitted alto- gether. This will give an ad- vantage to employers who adopt the plan of working short time in times of depression instead of dismissing some men and keep- ing the rest on full time. (e) In the case of workmen engaged through a Labour Exchange, the Labour Exchange may by ar- rangement with the employer undertake on his behalf the whole duty of keeping and stamping insurance books, and further, may treat all the suc- cessive periods of employment of the same or different work- men engaged by that employer through the Exchange as a single continuous period of em- ployment of one workman. In other words, an employer who uses the Exchange may pay ac- cording to the amount of labour he has in fact used, even though the employment has been dis- continuous, and though he has not always had the same man. Correspondingly, a man en- gaged through the Labour Exchange by one or more employers with whom an arrangement has been made will be allowed to pay a single con- tribution per week, however many separate engagements he has had. (/) Any workman who becomes re- peatedly unemployed through lack of skill or knowledge may be required to attend a suitable course of technical instruction, and if he fails to do so or to profit by such instruction, this fact may be taken into account in considering what is suitable employment for him. The combined effect of these provi- sions is to give a substantial advantage both to the employer and to the work- man in respect of regular and continu- ous employment as compared with casual engagements. This discrimina- tion is justified both equitably and actuarially by the saving to the unem- ployment fund which results from the diminution of claims for unemployment benefit. 62 THE PEOPLE'S INSURANCE PRESERVATION AND ENCOURAGEMENT OF VOLUNTARY INSURANCE. Provision is made in the following ways for the preservation and encour- agement of voluntary insurance against unemployment. Through an Association of Workmen In the first place, an association of workmen in the insured trades which gives unemployment benefit can make an arrangement with the Board of Trade, enabling its members to draw benefit, not from the unemployment fund direct through the Labour Ex- change, but through the association. The association will thereafter claim a refund from the unemployment fund of the sums to which the individual mem- ber would have been entitled. The association may thus be the channel for the distribution of the statu- tory benefits to its own members. It will, of course, be at liberty to give what benefits it pleases over and above the statutory benefits, and to give them for what periods and subject to what rules it pleases. The individual mem- ber of the association will be concerned only with the rules of his own associa- tion, and in place of having to attend at the Labour Exchange to get, say, 75., and at the association office to get another 4 s. or 55., he will be able to get the whole us. or I2S. from his association, leaving the latter subse- quently to settle with the unemploy- ment fund. In order to secure the interest 6f the association in economical distribution and to encourage provision of benefits beyond the statutory mini- mum, it is provided that repayments to an association under this clause shall not exceed two-thirds of what it has itself expended. In addition to repay- ments under this clause (79) the asso- ciation will be entitled to participate in the subsidy payable under the scheme of voluntary insurance de- scribed in the next paragraph. Subsidy from Board of Trade In the second place, it is provided that the Board of Trade may out of moneys provided by Parliament pay to any association giving unemployment benefits a subsidy of one-sixth of the amount (up to a maximum rate of 125. a week) expended on such benefits, exclusive, in the case of an Association which has made an arrangement under Section 105 of any sum repaid to the Association under that arrangement. This provision, which is applicable to all trades and all classes of employees, thus adds on to the limited compulsory insurance scheme a scheme for uni- versal voluntary insurance through associations. Possible Extension to other Trades While the compulsory part of the scheme is limited at the outset to the trades mentioned, power is given to the Board of Trade to extend it to other trades by special order involving the procedure already described. Miscellaneous Provisions Miscellaneous provisions, e.g., for inspection of workplaces so as to see that cards of men engaged are being duly stamped; for making unemploy- ment benefit inalienable; and for ex- cluding consideration of any benefit THE PEOPLE'S INSURANCE under the Bill when Boards of Guar- dians are making a grant of outdoor relief, are contained in the general part of the National Insurance Bill (Part III). Estimate of Number of Persons Affected by the Scheme It is estimated that 2,421,000 work- people of 1 8 years of age and up- wards will come within the compulsory insurance scheme at the outset, and that these will be divided into two groups as follows : Engineering, shipbuilding, and con- struction of vehicles, 1,100,000. Building and works of construction, 1,321,000. The membership of trade unions in the insured trades at the end of 1909 was 462,288, of whom about 350,000 belonged to unions providing unem- ployment benefits other than travelling pay. TEXT OF THE NATIONAL INSURANCE ACT, 1911 ARRANGEMENT OF SECTIONS PART I. NATIONAL HEALTH INSURANCE. Insured Persons. Section. 1. Insured persons. 2. Exemptions. Contributions. insured persons, em- by the Treasury. 3. Contributions ployers, and _ 4. Rates and rules for contributions by employed contributors and their em- ployers. 5. Rates and rules for contributions by voluntary contributors. 6. Change from voluntary rate to employed rate and vice versd. 7. Power to make regulations for the pay- ment of contributions. Benefits. 8. Benefits. 9. Reduced rates of benefit in certain cases. 10. Reduced rates of benefits where contribu- tions are in arrear. 11. Provisions in the case of contributors entitled to compensation or damages. 12. Provisions in the case of contributors who are inmates of hospitals, &c. 13. Power to vary benefits in certain cases. Administration of Benefits. 14. Administration of benefits by approved societies or the Insurance Committee. 15. Administration of medical benefit. 16. Administration of sanatorium benefit. 17. Power to extend sanatorium benefit to dependants. 18. Administration of maternity benefit. 19. Punishment of husband in certain cases of neglect. 20. Reinsurance for the purposes of maternity benefit. 21. Power to subscribe to hospitals, &c. 22. Power of councils of boroughs and dis- tricts to contribute to certain expendi- ture on medical and sanatorium benefits. Approved Societies. 23. Conditions for the approval of approved societies. 24. Power of societies to undertake business under Part I. 25. Special provisions for employers' provi- dent funds, &c. Section. 26. Security to be given by approved societies. 27. Provisions as to approved societies. 28. Secessions, &c. 29. Withdrawal of approval. Membership of Approved Societies and Transfer of Members. 30. Admission of insured persons to member- ship in approved societies.' 31. Transfer from one approved society to another. 32. Transfers to foreign and colonial societies. 33. Transfer values of emigrants who remain members of approved societies. 34. Prohibition against double insurance. Accounts: Valuations: Surplus and Deficit. 35. Approved societies to keep proper ac- counts. 36. Valuations of approved societies. 37. Surplus. 38. Deficit. 39. Pooling arrangements in the case of small societies. 40. Special provisions with regard to societies with branches. 41. Power to separate men's and women's fund. Deposit Insurance. 42. Provisions as to deposit contributors. 43. Transfer from approved society to deposit insurance and vice versa. Provisions as to Special Classes of Insured Persons. 44. Special provisions with respect to married women. 45. Special provisions as to aliens. 46. Special provisions with regard to persons in the naval or military service of the Crown. 47. Special provisions where employer liable to pay wages during sickness. 48. Special provisions as to the mercantile marine. 49. Provisions as to persons over sixty five at commencement of Act. 50. Special provisions as to seasonal trades. 51. Special provisions as to inmates of charit- able homes, &c. 52. Special provision as to persons becoming certificated teachers. 53. Application to other persons in the service of the Crown. c* 2 68 THE PEOPLE'S INSURANCE Financial Provisions. Section.. 54. National Health Insurance Fund. 55. Reserve values. 56. Transactions between the Insurance Com- missioners and societies. Insurance Commissioners : Advisory Com- mittee. 57. Constitution of Insurance Commissioners, appointment of inspectors, &c. 58. Appointment of advisory committee. Insurance Committees. S9- Appointment of Insurance Committees. 60. Powers and duties of Insurance Com- mittees. or. Income. 02. Local medical committee. Excessive Sickness. 13. Inquiries into causes of excessive sick- ness, &c. Supplementary Provisions. 64. Provision of sanatoria, &c. 65. Power to Insurance Commissioners to make regulations, &c. 66. Determination of questions by Insurance Commissioners. 67. Disputes. 68. Protection against distress and execution in certain cases. 69. Offences. 70. Civil proceedings against employer for neglecting to pay contributions. 71. Repayment of benefits improperly paid. 72. Provisions as to application of the exist- ing funds of friendly societies. 73. Provisions as to existing employers' pro- vident funds. 74. Provisions as to minors who are mem- bers of approved societies. 75. Power for societies to register under Friendly Societies Act, 1896. 76. Application of Acts of Parliament to approved societies and sections. 77. Powers of the Local Government Board. 78. Power to remove difficulties. 79. Interpretation. So. Application to Scotland. 81. Application to Ireland. 82. Establishment of Commissioners for Wales. 83. Joint Committee of Commissioners. PART II. UNEMPLOYMENT INSURANCE. Section. 84. Right of workmen in insured trades to unemployment benefit. 85. Contributions by workmen, employers, and the Treasury. 86. Statutory conditions for receipt of unem- ployment benefit. 87. Disqualifications for unemployment bene- fit. 88. Determination of claims. 89. Appointment of umpire, insurance officers, inspectors, &c. 90. Courts of referees. 91. Regulations. 92. Unemployment fund. 93. Treasury advances. 94. Refund of part of contributions paid by employer in the case of workmen con- tinuously employed. 95. Repayment of part of contributions by workmen in certain cases. 96. Refund of contributions paid in respect of workmen working short time. 97. Saving for occasional employment in rural neighbourhoods. 98. Payment of contributions in case of Reservists or Territorials during train- ing. 99. Provisions with respect to workmen en- gaged through labour exchanges. 100. Subsidiary provisions. 101. Offences and proceedings for recovery of contributions, &c. 102. Periodical revision of rates of contribu- tion. 103. Power to extend to other trades. 104. Exclusion of subsidiary occupations. 105. Arrangements with associations of work- men in insured trade who make pay- ments to members whilst unemployed. 1 06. Repayments to associations who make payments to persons, whether work- men in insured trade or not, whilst unemployed. 107. Interpretation and application. PART III. GENERAL. 108. Provisions as to stamps. 109. Outdoor relief. no. Priority of claims for contributions due by bankrupt employers, in. Benefits to be inalienable. 112. Powers of inspectors. 113. Procedure for making special orders. 114. Provisions as to birth certificates. 115. Short title arid commencement. SCHEDULES. PART III TEXT OF THE NATIONAL INSURANCE ACT, 1911 An Act to provide for Insurance against Loss of Health and for the Prevention and Cure of Sickness, and for Insurance against Unemployment, and for purposes incidental thereto. [16 December, 1911] BE it enacted by the King's most Excellent Majesty, by and with the advice and consent of the Lords Spiri- tual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows : PART I. NATIONAL HEALTH INSURANCE. Insured Persons. i. (i) Subject to the provisions of this Act, all persons of the age of six- teen and upwards who are employed within the meaning of this part of this Act shall be, and any such persons who are not so employed but who possess the qualifications hereinafter mentioned may be, insured in manner provided in this part of this Act, and all persons so insured (in this Act called " insured persons ") shall be entitled in the man- ner and subject to the conditions pro- vided in this Act to the benefits in respect of health insurance and pre- vention of sickness conferred by this Part of this Act. (2) The persons employed within the meaning of this Part of this Act (in this Act referred to as "employed contributors ") shall include all per- sons of either sex, whether British subjects or not, who are engaged in any of the employments specified in Part I. of the First Schedule to this Act, not being employments specified in Part II. of that schedule : Provided that the Insurance Com- missioners hereinafter constituted may with the approval of the Treasury, by a special order made in manner hereinafter provided, provide for in- cluding amongst the persons employed within the meaning of this Part of this Act any persons engaged in any of the excepted employments specified in Part II. of the said schedule, either unconditionally or sub- ject to such conditions as may be specified in the order. (3) The persons not employed within the meaning of this Part of this Act who are entitled to be insured persons include all persons who either (a) are engaged in some regular oc- cupation and are wholly or mainly dependent for their liveli- hood on the earnings derived by them from that occupation; or (b) have been insured persons for a period of five years or upwards ; and the persons possessing such quali- fications who become or continue to be 7 THE PEOPLE'S INSURANCE insured persons are in this Act referred to as voluntary contributors : Provided always that no person whose total income from all sources exceeds one hundred and sixty pounds a year shall be entitled to be a voluntary contri- butor unless he has been insured under this Part of this Act for a period of five years or upwards. (4) Except as hereinafter provided, nothing in this section shall require or authorise a person of the age of sixty-five or upwards not previously insured under this Part of this Act to become so insured. Exemptions 2. (i) Where any person employed within the meaning of this Part of this Act proves that he is either (a) in receipt of any pension or in- come of the annual value of twenty-six pounds or upwards not dependent upon his personal exertions ; or (b) ordinarily and mainly dependent for his livelihood upon some other person, he shall be entitled to a certificate ex- empting him from the liability to be- come or to continue to be insured under *his Part of this Act. (2) All claims for exemption shall be made to, and certificates of exemption granted by, the Insurance Commis- sioners in the prescribed manner and subject to the prescribed conditions, and may be so made and granted before, as well as after, the commence- ment of this Act: Provided that the regulations of the Insurance Commis- sioners may provide for claims under this section being made to, and certifi- cates granted by, approved societies and Insurance Committees hereinafter constituted. Contributions. Contributions by Insured Persons, Em- ployers, and the Treasury 3. Except as otherwise provided by this Act, the funds for providing the benefits conferred by this Part of this Act and defraying the expenses of the administration of those benefits shall be derived as to seven-ninths (or, in the case of women, three-fourths) thereof from contributions made by or in respect of the contributors by themselves or their employers, and as to the remaining two-ninths (or, in the case of women, one-quarter) thereof from moneys provided by Parliament. Rates and Rules for Contributions by Employed Contributors and their Employers 4. (i) The contributions payable in respect of employed contributors shall be at the rate specified in Part I. of the Second Schedule to this Act (here- inafter referred to as the employed rate), and shall comprise contributions by the contributors and contributions by their employers at the rates speci- fied in that Part of that schedule, and shall be payable at weekly or other prescribed intervals : Provided that in the case of an employed contributor, of the age of twenty-one or upwards whose remuneration does not include the provision of board and lodging by the employer and the rate of whose remuneration does not exceed two shillings a working day, such part of the contributions payable in respect of him as is specified in the said schedule shall be paid out of moneys provided by Parliament. (2) The employer shall, in the first instance, pay both the contributions payable by himself (in this Act referred to as the employer's contributions), THE PEOPLE'S INSURANCE and also on behalf of the employed contributor the contributions payable by such contributor, and shall be en- titled to recover from the contributor by deduction from his wages or other- wise the amount of the contributions so paid by him on behalf of the contribu- tor in accordance with the rules set out in the Third Schedule to this Act. (3) Contributions in respect of em- ployed contributors shall cease to be payable on their attaining the age of seventy. (4) The employer of a person who though employed within the meaning of this Part of this Act is not insured under this Part of this Act by reason either (a) that not having previously been an insured person, he has become employed within the meaning of this Part of this Act after attain- ing the age of sixty-five ; or (b) that he has obtained and still holds* a certificate of exemption under this Part of this Act ; shall be liable to pay the like contri- butions as would have been payable as employer's contributions if such per- son had been an employed contributor, and such contributions shall be carried to such account and dealt with in such manner as may be prescribed by regu- lations made by the Insurance Com- missioners, and those regulations may provide for applying the sums standing to the credit of the account, or any part thereof, for the benefit of any persons in respect of whom contribu- tions have been so paid, in the event of such persons subsequently becom- ing employed contributors. Rates and Rules for Contributions by Voluntary Contributors 5. (i) The contributions payable by voluntary contributors shall be at the rate appropriate to their age at the date of their entry into insurance ascer- tained in accordance with a table to be prepared by the Insurance Commis- sioners (hereinafter referred to as the voluntary rate) and shall be paid by the voluntary contributors at weekly or other prescribed intervals : Provided that (a) In the case of a person who enters into insurance within six months after the commencement of this Act, the voluntary rate shall, if he is below the age of forty-five at the date of entering into insurance, be the same as the employed rate, and if he is of the age of forty-five or up- wards, be such rate, ascertained according to a table to be pre- pared by the Insurance Com- missioners, as, having regard to his age at that date, will be sufficient to cover seven- ninths, or in the case of a woman three-fourths, of the benefits con- ferred by this Part of this Act ; (b) Where a person, having been an employed contributor for five years or upwards, becomes a voluntary contributor the rate of contribution payable by him shall continue to be the employed rate. (2) Contributions by voluntary con- tributors shall cease to be payable on their attaining the age of seventy. Change from Voluntary Rate to Em- ployed Rate and vice versa 6. (i) Where an insured person has become a member of an approved society as a voluntary contributor, the rate of contributions payable in respect of him shall notwithstanding that he becomes employed within the meaning THE PEOPLE'S INSURANCE of this Part of this Act, remain the voluntary rate, unless at any time after becoming so employed he gives notice in the prescribed manner of his wish to be transferred to the employed rate. (2) Where he gives such notice the rate payable in respect of him shall be the employed rate, but in such case the rate of sickness benefit payable in respect of him shall be such reduced rate as would have been payable had he not previously been insured, sub- ject to such addition as may according to tables prepared by the Insurance Commissioners represent the value at that time of the contributions pre- viously paid by him. (3) Where he does not give such notice, and until he does so, the con- tributions payable by his employer in respect of him during any period of employment within the meaning of this Part of this Act shall be the same as if he had been transferred to the em- ployed rate, and the contributions so paid by the employer shall be treated as in part satisfaction of the contributions at the voluntary rate payable by the contributor, and if the contributor fails to pay the balance he shall be deemed to be in , irrear to that extent. (4) Where an employed contributor within five years from his entry into insurance ceases to be employed within the meaning of this Part of this Act and becomes a voluntary contributor, he shall be deemed to be in arrear, as from the date when he so became a voluntary contributor, to the amount of the difference between the aggregate contributions paid by or in respect of him since his entry into insurance and the aggregate of the contributions which would have been payable by him had he throughout been a voluntary contributor, and the difference between any reserve value which is credited to the approved society of which he is a member in respect of him and the re- serve value (if any) which would have been credited to that society in respect of him had he originally become a voluntary contributor shall be can- celled. Power to make Regulations for the Payment of Contributions 7. Subject to the provisions of this Act, the Insurance Commissioners may make regulations providing for any matters incidental to the payment and collection of contributions payable under this Part of this Act, and in par- ticular for (a) payment of contributions whether by means of adhesive or other stamps affixed to or impressed upon books or cards, or other- wise, and regulating the manner, times, and conditions in, at, and under which such stamps are to be affixed or impressed, or pay- ments are otherwise to be made ; (b) the entry in or upon books or cards of particulars of contribu- tions paid and benefits dis- tributed in the case of the in- sured persons to whom such books or cards belong ; (c) the issue, sale, custody, produc- tion, and delivery up of books or cards and the replacement of books or cards which have been lost, destroyed, or defaced. Benefits Benefits. 8. (i) Subject to the provisions of this Act the benefits conferred by this Part of this Act upon insured persons are (a) Medical treatment and attend- ance, including the provision of THE PEOPLE'S INSURANCE 73 proper and sufficient medicines and such medical and surgical appliances as may be prescribed by regulations to be made by the Insurance Commissioners (in this Act called "medical bene- fit"); (b) Treatment in sanatoria or other institutions or otherwise when suffering from tuberculosis, or such other diseases as the Local Government Board with the ap- proval of the Treasury may appoint (in this Act called " sanatorium benefit ") ; (c) Periodical payments whilst ren- dered incapable of work by some specific disease or by bodily or mental disablement, of which notice has been given, com- mencing from the fourth day after being so rendered inca- pable of work and continuing for a period not exceeding twenty-six weeks (in this Act called " sickness benefit ") ; (d) In the case of the disease or disablement continuing after the determination of sickness bene- fit, periodical payments so long as so rendered incapable of work by the disease or disablement (in this Act called "disablement benefit ") ; (e) Payment in the case of the con- finement of the wife or, where the child is a posthumous child, of the widow of an insured person, or of any other woman who is an insured person, of a sum of thirty shillings (in this Act called " maternity benefit ") ; (/) In the case of persons entitled under this Part of this Act to any of the further benefits men- tioned in Part II. of the Fourth Schedule to this Act (in this Act called " additional benefits ") such of these benefits as they may be entitled to. (2) Subject to the provisions of this Part of this Act, the rates of sickness benefit and disablement benefit to which insured persons are entitled shall be the rates specified in Part I. of the Fourth Schedule to this Act. (3) In the case of insured persons who have attained the age of seventy, the right to sickness benefit and dis- ablement benefit shall cease. (4) No insured person shall be entitled to any benefit during any period when he is resident either tem- porarily or permanently outside the United Kingdom. Provided that, if a person is tempor- arily resident in the Isle of Man or the Channel Islands, he shall not, whilst so resident, be disentitled to benefits other than medical benefit, and that, if with the consent of the society or committee by which the benefit is administered a person is temporarily resident outside the United Kingdom elsewhere than in the Isle of Man or the Channel Islands, the society or committee may allow him, whilst so resident, to continue to receive sickness or disablement benefit, and that a person resident out of the United Kingdom shall not be dis- entitled to maternity benefit in re- spect of the confinement of his wife, if his wife at the time of her con- finement is resident in the United Kingdom. (5) Where an insured person, having been in receipt of sickness benefit, re- covers from the disease or disablement in respect of which he receives such benefit, any subsequent disease or dis- ablement, or a recurrence of the same disease or disablement, shall be deemed to be a continuation of the previous disease or disablement, unless in the 74 THE PEOPLE'S INSURANCE meanwhile a period of at least twelve months has elapsed, and at least fifty weekly contributions have been paid by or in respect of him : (6) Where a woman confined of a child is herself an insured person, and is a married woman, or, if the child is a posthumous child, a widow, she shall be entitled to sickness benefit or disablement benefit (as the case may be) in respect of her confinement in addition to the maternity benefit to which she or her husband may be en- titled, but, save as aforesaid, a woman shall not be entitled to sickness benefit or disablement benefit for a period of four weeks after her confinement un- less suffering from disease or disable- ment not connected directly or in- directly with her confinement. Medical benefit shall not include any right to medical treatment or attend- ance in respect of a confinement. (7) Where a pension or superannua- tion allowance is payable by an ap- proved society in whole or in part as an additional benefit under this Part of this Act, or out of any fund to which contributions have been made in ac- cordance with paragraph (10) of Part II. of the Fourth Schedule to this Act, it may be made a condition of the grant of the pension or allowance that a mem- ber of the society shall, whilst in re- ceipt of such pension or allowance, be excluded in whole or in part from his right to sickness benefit and disable- ment benefit, or to either of such benefits. (8) Notwithstanding anything in this Part of this Act, no insured person shall be entitled (a) to medical benefit during the first six months after the commence- ment of this Act; (b) to sickness benefit unless and until twenty-six weeks have elapsed since his entry into in- surance, and at least twenty-six weekly contributions have been paid b3 r or in respect of him ; (c) to disablement benefit unless and until one hundred and four weeks have elapsed since his entry into insurance, and at least one hundred and four weekly contributions have been paid by or in respect of him ; (d) to maternity benefit unless and until twenty-six, or in the case . of a voluntary contributor fifty- two weeks have elapsed since: his entry into insurance, and at least twenty-six, or in the case of a voluntary contributor fifty- two, weekly contributions have been paid by or in respect of him. (9) As soon as the sums credited to approved societies as reserve values in respect of persons who enter into insurance within one year after the commencement of this Act have been written off in manner provided by this Part of this Act, the benefits payable to insured persons under this Part of this Act shall be extended in such manner as Parliament may determine. Reduced Bates of Benefit in Certain Cases 9. (i) In the case of insured per- sons who are under the age of twenty- one years and unmarried, sickness benefit and disablement benefit shall be at the reduced rates specified in Table B. in Part I. of the Fourth Schedule to this Act: Provided that where any such per- son, being a member of an approved society, proves that one or more members of his family are wholly or mainly dependent upon him, the society shall dispense with such reduction. (2) Where in the case of any insured THE PEOPLE'S INSURANCE persons the rate of sickness benefit or disablement benefit (as the case may be) exceeds two-thirds of the usual rate of wages or other remuneration earned by such persons, the rate of such benefit may be reduced to such an extent as the society or committee administering the benefit, with the consent of the Insurance Commis- sioners, determines; but where such reduction is made provision shall be made by the society or committee, with the like consent, for the grant of one or more additional benefits of a value equivalent to such reduction. (3) The rate of sickness benefit shall be reduced in accordance with Table C. in Part I. of the Fourth Schedule to this Act in the case of any insured person who becomes an em- ployed contributor within one year after the commencement of this Act, and is at the date of so becoming an employed contributor of the age of fifty years or upwards and the number of weekly contributions paid by or in re- spect of him is at the date of any claim by him for such benefit less than five hundred. (4) In the case of every person who, not having been previously insured under this Part of this Act, becomes an employed contributor subsequently to the expiration of one year from the commencement of this Act, and is, at the time of so becoming an employed contributor, of the age of seventeen or upwards, the rate of sickness benefit to which he is entitled shall (unless he proves that his time since he attained the age of seventeen has been spent in a school or college, in indentured ap- prenticeship or otherwise under instruc- tion without wages or otherwise in the completion of his education, or unless he undertakes himself to pay the differ- ence between the voluntary rate and the employed rate, or pays to the Insur- ance Commissioners, to be credited to the Society, such capital sum as will be sufficient to secure him benefits at the full rate) be such reduced rate as may be fixed in accordance with tables to be prepared by the Insurance Commis- sioners, but not in any case less than five shillings a week : Provided that if at any time subse- quently such person would become en- titled to sickness benefit at a higher rate if he were treated as having be- come an employed contributor as from the time when he attained the age of seventeen, or as from the expiration of one year after the commencement of this Act, whichever date may be the later, and as being in arrear for all con- tributions which, had he become an employed contributor at that date, would have been payable in respect of him between that date and the date when he actually became an employed contributor, he shall, if he so elects, be entitled to be so treated. Reduced Rates of Benefits where Con- tributions are in Arrear 10. (i) Where an insured person being a member of an approved society is in arrear to an amount greater than thirteen weekly contributions a year on the average since his entry into insur- ance, his right to benefits under this Part of this Act other than medical benefit, sanatorium benefit, and mater- nity benefit shall be suspended, and where he is in arrears to an amount greater than twenty-six weekly con- tributions a year on the average since his entry into insurance his right to medical benefit, sanatorium benefit, and maternity benefit shall be sus- pended, and at the expiration of the calendar year next after the date when he becomes suspended from all 4 THE PEOPLE'S INSURANCE benefits any sums credited to the society in respect of him, calculated in the prescribed manner, shall, if his right to benefits still continues to be suspended, be carried to such account and dealt with in such manner as may be pre- scribed for the benefit (except so far as such sums comprise sums in respect of a reserve value) of the society or 12 5 t> 5 3 13 5 5 gs. od. , commencing I 5th day after commencement ' of illness. fl 6th rt 7th C3 . 8th S e 9th ^3 o " loth O ^ nth M 1 2th 1 3th 1 4th 170 THE PEOPLE'S INSURANCE Notes. Where the insured person is by virtue of any of the provisions of Part I. of this Act, other than those relating to arrears, entitled to sickness benefit at a rate lower than the full rate, this Table shall have effect as if the entries in the first column were so shifted down that the first entry therein was set opposite the entry in the second column next below the entry specifying the rate of sickness benefit to which the in- sured person is entitled. When the rate of sickness benefit during the first thirteen weeks to which the insured person is entitled is by virtue of any of the provisions of this Act, other than those relating to arrears, less than 55. a week, this Table shall have effect as if such lower rate were therein substituted for the rate of 5$. a week. SIXTH SCHEDULE. LIST OF INSURED TRADES FOR THE PUR- POSES OF PART II. OF THIS ACT RELAT- ING TO UNEMPLOYMENT INSURANCE. (1) Building; that is to say, the con- struction, alteration, repair, decora- tion, or demolition of buildings, in- cluding the manufacture of any fittings of wood of a kind commonly made in builders' workshops or yards. (2) Construction of works ; that is to say, the construction, reconstruction, or alteration of railroads, docks, har- bours, canals, embankments, bridges, piers or other works of construction. (3) Shipbuilding; that is to say, the construction, alteration, repair, or decoration of ships, boats, or other craft by persons not being usually mem- bers of a ship's crew, including the manufacture of any fittings of wood of a kind commonly made in a shipbuild- ing yard. (4) Mechanical engineering, includ- ing the manufacture of ordnance and firearms. (5) Ironfounding, whether included under the foregoing headings or not. (6) Construction of vehicles; that is to say, the construction, repair, or decoration of vehicles. (7) Sawmilling, including machine woodwork carried on in connection with any other insured trade or of a kind commonly so carried on. SEVENTH SCHEDULE. RATES AND PERIODS OF UNEMPLOYMENT BENEFIT. In respect of each week following the first week of any period of unem- ployment, seven shillings, or such other rates as may be prescribed either generally or for any particular trade or any branch thereof : Provided that, in the case of a work- man under the age of eighteen, no un- employment benefit shall be paid while the workmen is below the age of seven- teen, and while the workman is of the age of seventeen or upwards but below the age of eighteen, unemployment benefit shall only be paid at half the rate at which it would be payable if the workman was above the age of eighteen. No workman shall receive unemploy- ment benefit for more than fifteen or such other number of weeks as may be prescribed either generally or for any particular trade or branch thereof with- in any period of twelve months, or in respect of any period less than one day. THE PEOPLE'S INSURANCE 171 No workman shall receive more un- employment benefit than in the propor- tion of one week's benefit for every five contributions paid by him under this Act. Provided that for the purpose of the foregoing- paragraph (a) In the case of a workman who satisfies the Board of Trade that he is over the age of twenty-one and has habitually worked at an insured trade before the com- mencement of this Act, there shall be deemed to be added to the number of contributions which he has actually paid five contributions for each period of three months or part of such period during which he has so worked before the commence- ment of this Act, up to a maxi- mum of twenty-five contribu- tions ; and (b) where, owing to the fact that the wages or other remuneration of a workman are paid at intervals greater than a week, or for any other like reason contributions are paid under Part II. of this Act in respect of any workman at intervals greater than a week, that workman shall be entitled to treat each of such contribu- tions as so many contributions as there are weeks in the period for which the contribution has been paid. Any time during which a workman is under Part II. of this Act disqualified for receiving unemployment benefit shall be excluded in the computation of periods of unemployment under this Schedule. A period of unemployment shall not be deemed to commence till the work- man has made application for unem- ployment benefit in such manner as may be prescribed. The power conferred by this Schedule on the Board of Trade to prescribe rates and periods of unem- ployment benefit shall not be exercised so as to increase the rate of benefit above eight shillings per week or re- duce it below six shillings per week, or to increase the period of unemployment benefit above fifteen weeks, or to alter the proportion which the period of benefit bears to the number of contribu- tions paid, except by rules confirmed by an order made in accordance with the provisions of this Act relating to special orders. EIGHTH SCHEDULE. CONTRIBUTIONS FOR THE PURPOSES OF PART II. OF THIS ACT RELATING TO UNEMPLOYMENT INSURANCE. RATES OF CONTRIBUTION FROM WORK- MEN AND EMPLOYERS. From every workman employed in an insured trade for every week he is so employed - - 2^d, From every employer by whom one or more workmen are em- ployed in an insured trade, in respect of each workman, for every week he is so employed - 2\d. Provided that in the case of a work- man below the age of eighteen id. shall be substituted for 2^d. as the contribu- tion from the workman and from the employer, but for the purpose of reck- oning the number of contributions in respect of such a workman except as regards the payment of unemployment benefit before he reaches the age of eighteen the id. shall be treated as two-fifths of a contribution. Every such period of employment of less than a week shall for the purposes 172 THE PEOPLE'S INSURANCE of this Schedule be treated as if it were employment for a whole week, except that, where the period of employment is two days or less, the contributions both of the employer and of the work- man shall be reduced to one penny if the period does not exceed one day and to twopence if it exceeds one day ; and in such case in reckoning- the number of contributions under Part II. of this Act and the Schedules therein referred to contributions at such reduced rates shall be treated as two-fifths or four- fifths of a contribution as the case may require. NINTH SCHEDULE. PROVISIONS OF THE FACTORY AND WORKSHOP ACT, 1901, APPLIED TO SPECIAL ORDERS MADE UNDER THIS ACT. 80. (i) Before the authority em- powered to make special orders make any special order under this Act, they shall publish, in such manner as they may think best adapted for inform- ing persons affected, notice of the pro- posal to make the order, and of the place where copies of the draft order may be obtained, and of the time (which shall be not less than twenty- one days) within which any objection made with respect to the draft order by or on behalf of persons affected must be sent to the authority. (2) Every objection must be in writ- ing and state (a) the draft order or portions of draft order objected to ; (b) the specific grounds of objection ; and (c) the omissions, additions. or modifications asked for. (3) The authority shall consider any objection made by or on behalf of any persons appearing to them to be affected which is sent to them within the required time, and they may, if they think fit, amend the draft order, and shall then cause the amended draft to be dealt with in like manner as an original draft. (4) Where the authority do not amend or withdraw any draft order to which any objection has been made, then (unless the objection either is withdrawn or appears to them to be frivolous) they shall, before making the order, direct an inquiry to be held in the manner hereinafter provided. 81. (i) The authority may appoint a competent and impartial person to hold an inquiry with regard to any draft order, and to report to them thereon. (2) The inquiry shall be held in public, and any objector and any other person who, in the opinion of the per- son holding the inquiry, is affected by the draft order, may appear at the inquiry either in person or by counsel, solicitor, or agent. (3) The witnesses on the inquiry may, if the person holding it thinks fit, be examined on oath. (4) Subject as aforesaid, the inquiry and all proceedings preliminary and incidental thereto shall be conducted in accordance with rules made by the Board of Trade. (5) The fee to be paid to the person holding the inquiry shall be such as the authority may direct and shall be deemed to be part of the expenses of the authority in carrying this Act into effect. (6) For the purposes of this schedule, the expression " authority " means the Insurance Commissioners or the Board of Trade, as the case may be. IN DEFENCE OF THE MEASURE PART IV IN DEFENCE OF THE MEASURE I. INSURANCE AS A WEAPON AGAINST POVERTY AND DISEASE (From a Speech delivered by the RIGHT HON. D. LLOYD GEORGE in Birmingham, June loM, 1911.) An Affair of Urgent Importance IT is very good of you on a warm and pleasant June afternoon to come here to discuss an affair of urgent public importance. I have come here this afternoon to talk to you about the national health. Your chairman has already reminded you that a few weeks ago I had the honour of introducing in the House of Commons a measure dealing with proposals for securing the national health, and also proposals for securing the workers of this country I against the distress which is incidental to the illness of a breadwinner or to the failure of employment. I have devoted three years of labour, research, con- sultation, and continuous thought to that proposal. I have been assisted by many able, experienced, and well-in- formed men, and I am delighted to see two or three of them here on this plat- form some of the ablest men in the friendly society world and I am very pleased in your presence to be able to express my gratitude to them for the great help which they gave me in the preparation of that scheme. Necessity for Early Passing of the Bill I hope to see this scheme soon converted into an Act of Parlia- ment. I am told that if it took the Government three years to prepare it you certainly ought to give the same time for people to examine it. But if it takes three years to build a house it need not take three years to make up your mind whether you will purchase it. It takes time to lay down your foundations, prepare your plans, gather your materials, and put up your structure, but surely you can make up your mind in at least a few months whether the house suits you and whether you want a few alterations. If it takes as much time to make altera- tions as it took to build the house, it means that the house does not suit you. But since I am to talk about surveying the structure, may I also add that if you want to find out whether a building is adapted to your purpose you should never survey it with a microscope in order to discover the quality of the atoms in the bricks. Examine it as a whole, see whether it fits you, make such alterations as you require, and then live happily ever afterwards. Not that you will never need further re- pairs. The happy householder is a man who is constantly making altera- tions in his house, adding here, decorating there, and adorning some other portions of the house. It is part of the happiness of life to do that, and 175 1 7 6 THE PEOPLE'S INSURANCE when you have the National Insurance Bill I have no doubt from time to time you will find that amendment, altera- tion, and decoration will be required in that as well. The Unanimous Acceptance of the Main Principles of the Bill I cannot in the course of this after- noon cover one-tenth of the ground which it is necessary to survey when you are dealing with a gigantic prob- lem of this kind, and if anybody on Monday morning complains that I have omitted something, or that I have overlooked something else, you may depend upon it that 1 have not done so because I am under any apprehension with regard to any criticism which I have yet heard delivered or directed against the Bill. I must have some regard to the limitations of time, to the limitations of your own patience and of my own strength. Your chairman has said, and said very truly, that the main principles of the Bill have been accepted with perfectly amazing unanimity. In fact, for the first few weeks it was smothered in honey; so much so that it looked .suspicious, be- cause 1 observed that a good many of the eulogiums passed on the Bill said that it was so good that it would be a pity to pass it this year. I really can- not recall anything of the kind since the days when the Duke of Clarence was drowned in a butt of sweet wine. And my Bill runs practically the same risk at the present moment. "An ex- cellent Bill, just what we wanted ; hope some day it will be an Act of Parlia- ment, but don't be in a hurry, don't pass it now ; let's think about it, let's talk about it, let's do anything except put it on the Statute Book." But I am out for making it an Act of Parliament. Necessity for a Firm Grip of the Purpose of the Measure There is a real danger in the unani- mity with which the principles of the Bill have been accepted, and I will tell you why they are not discussed. If you call attention to the objects of the Bill they say, "We accept that." They are taken for granted. If you begin to dwell upon its principles they say, "That is a waste of time we accept that." They say the measure has been rushed into Committee before it really was allowed to have a second reading. I am not protesting against an exam- ination of the Bill. I invited it when I introduced the Bill. It is important it should be scrutinised to the last detail. But any examination of the detail can be nothing but barren unless you have a firm grip of the purpose and main outlines of the measure ; and for that reason I propose here this afternoon to deal with the Bill as a whole, why it was introduced, what are the chief characteristics of it, and what are the remedies we propose in it for the evil we have to contend against. The Evil We have to Contend Against What is the evil in this country and in every old country in the world? Side by side with great and most ex- travagant wealth you have got multi- tudes of people who cannot consider even a bare subsistence as assured to them. What do I mean by a bare sub- sistence? I don't mean luxuries; I exclude even comforts. By a bare subsistence I mean that minimum of food, raiment, shelter, and medical care which is essential to keep human life in its tenement of clay at all. For multitudes in every land that is pre- carious to-day. THE PEOPLE'S INSURANCE To maintain Efficiency That is not our idea. We aspire to something more. Our object, our goal ought to be enough to maintain effi- ciency for every man, woman, and child. The individual demands it, the State needs it, humanity cries for it, . religion insists upon it. But for mil- lions of the poor a bare subsistence is difficult to win and easy to lose. The illness of the wage earner in hundreds of thousands of households, trade de- pression, a change of fashions precipi- tates thousands into destitution, poverty and privation. The wolves of hunger prowl constantly round millions of doors in this land, in this favoured land, and if the illness of the head of the family takes him away from his watch at the doorpost they rush in, and ere relief arrives plant their fangs deep into their victims. There are streets in every great city I am not excluding Birmingham where their snarl is ever heard in the ears of the inhabitants. That ought not to be. All their money is spent in food, shel- ter, raiment, and nothing can be spared for the storeroom when the needs of illness and unemployment come. The Pawnbroker I am asked how can they afford four- pence per week. They pay more now. Who to? To the friendly society? No. To the trade union? No. To the pawnbroker. They insure now, but it is the most wasteful method, the most extravagant method, the most heart-rending method. Sickness comes ; one little bit of furniture after another a labour of love goes. Furniture, clothes, all converted into food and physic. A day's wage to pay for the doctor when there is no one earning- it. " Family Pride is not in the Bent-Book " You may say, "There is the Poor Law." Ah! let me say this. To the honour of the workers of this country, the last thing they pawn is their pride. There is no greater heroism in history than you find in the humble annals of those who fight through life against odds to maintain their self-respect and independence. They will suffer the last privation before they pin the badge of pauperism over their hearts, and cer- tainly before they will put it on the breasts of their children. Read the records of the friendly societies. We have gentlemen here who can confirm what I say. A struggle is made to keep up contributions so as to avoid the chanty of the parish and keep up the honour and pride of the family. Family pride is not in the rent-book. You will find it amongst names that have never yet appeared in Dod, Burke, or Kelly. Many are compelled to surrender. They sustain the siege long, but it often ends in defeat, and if you look at the records of pauperism in this country you will find this : Take places like Leeds, Glasgow I have not the figures for Birmingham you will find that half of the outdoor pauperism is due directly to the illness or the breakdown of the breadwinner in the family. Now that is purely an index of the suffering it causes. "The Yawning Chasm which comes with Unemployment " Let me give you another fact. In the course of my investigations I mentioned this in the House of Com- mons, but I think it is worth repeating I discovered that most of the wage- earners in this country at one time or another have been members of friendly societies, of trade unions, or of provi- THE PEOPLE'S INSURANCE dent societies of some kind. Why are not they members now? They could not keep it up at sixpence or seven- pence a week, or even fivepence ; they could not carry it on. They went for some time accumulating benefit, but they could not carry it across that yawning chasm which comes with un- employment. We have gone out to bridge it for them. If you want to realise for a moment how precarious mere living is in hundreds of thousands of households you have only to think of what happens to that household when the wage-earner is swept away. It is hurled into poverty, destitution, and privation in hundreds and thou- sands of cases. The Strengthening of the Walls. . . . Some of you have travelled in Italy. There on the slopes of the hills you will see comfortable little cottages. They seem secure, planted on a rock. They are there under a blue sky without a frown in it, surrounded by orange and olive groves, swayed by the caressing breezes of a fair land. They seem happy, contented, secure homes. Pass by that neighbourhood in about a year, and look up where the cottages stood, and you will find an ugly gaping rent in the hillside. What has happened? A cloud gathered from the unknown burst over the homesteads, and swept them away into the abyss. The inhabi- tants are crushed and broken under the ruins of their homes. That is a fair picture of what happens to many a worker's home when the breadwinner is swept away. They are hurled into destitution. I will tell you what we are doing. We propose to strengthen the walls of the cottage against attack. We propose more than that to divert the flood so that it shall not attack those walls ; and I have not the faintest doubt that when this Bill becomes an Act of Parliament it will avert under the bless- ing of Providence myriads of ruined homes and broken hearts. Illness of the Breadwinner What is the special difficulty we have to meet? Your great citizen Mr. Chamberlain once said that preventable illness was responsible for filling the workhouses. I quite agree. The trouble now is many a workman has told me a workman cannot afford to put himself on the sick list ? Why ? He knows that the moment he feels unfit for work, goes to the doctor, seeks a few days' repose to recruit his strength and to recover his power, there will be none there providing for the household. So the workmen go on, unless there is some provision for them, working in what I think Dr. Bagster Wilson of your city calls, in a very able book which he published, a condition of under-health. That is thoroughly bad economy. It is thoroughly bad husbandry. Why, if that condition of things applied to horses and cattle the farmers of this country would be insolvent. Take a brewer's horse. How well he is looked after, how well fed, well cared for, well doctored if he does not feel up to the mark ! He has got a guardian there specially looking after him. The guar- dian says, "There is something the matter with this horse to-day ; he does not feel well." The shafts of the dray are empty that day. He is kept and doctored until he is right. That is not merely humanity; it is good business. Take a machine. If you neglect a machine a very small defect develops into a big one. It may simply mean that you want to oil the bearings I hope that is right to tighten a screw. THE PEOPLE'S INSURANCE 179 But if the machinist says, " I cannot afford to allow this machine to rest for two or three days in order to overhaul it," what happens? That machine has a bad breakdown sooner or later, and it may have to be scrapped. It is good business to overhaul a thing of that kind in time before it develops. How much better is man than a mach- ine? He may be better, but he is not better off, poor fellow. The Greatest Asset of any Land I will tell you the trouble there is no one who has a sense of re- sponsibility to look after him; it is nobody's concern to, see that that won- derfully delicate piece of machinery is all right, is fit. A man owns the machine, a man owns the horse; if they break down they are costly to replace. What is wanted in this coun- try, and in many others, is to cultivate in the State a sense of proprietorship over these workers. They are the greatest asset of any land. When you reckon up the national wealth and begin to talk about imports and ex- ports, when you add up our bank balances and the value of our railways, our house property, and our invest- ments, I have never seen a balance- sheet of that kind up to the present that did not omit the greatest asset of all, and that is the men, the women, and the children of the land. The Soul of the Problem You have our great Colonial leaders in this country now. We are all de- lighted to see, to hear, and to welcome them. Go to Canada with an offer in one hand of a million of our able- bodied workmen, in the other hand a hundred millions of our sterling gold. Do you think they would hesitate for a moment which to accept? It is the men, it is the women they want in order to develop and draw out and in- crease and improve the wealth and prosperity of their land. After all, work implies skill. We talk about unskilled labour. Let any man who is here accustomed to wield the pen try his hand for a day at the pick. t He'll start saying this is unskilled labour; he'll end by being completely disillu- sioned in half an hour, yea, less. There is the trained suppleness, the discipline of the eye ; you accustom the body to it. There is no unskilled business, and all that training cover- ing years, that is wealth, national wealth. And yet we waste it with a recklessness, with an unconcern, with an unintelligence which simply baffles anybody who sits down to consider the problem for five minutes. There is too little heed paid in our industrial organ- isation to the physical and mental efficiency of the worker. That is the soul of the problem. The Industry Contributes, not the Employer The other day I received a communi- cation from the Birmingham Chamber of Commerce. If I may respectfully say it, I have a great respect for the Birmingham Chamber of Commerce. I had a good deal to do with them when I had the honour of presiding over the Board of Trade. They were helpful, they were fair, and therefore I will consider any communication which comes from the Birmingham Chamber of Commerce, and consider it twice, and consider it three times with great care and with great respect. But I will tell you one proposition which they lay down in this communi- i8o THE PEOPLE'S INSURANCE cation by way of protesting against what they call the contribution of the employer. The employer does not contribute ; it is the industry that con- tributes. Take the factory legislation of the last forty or fifty years to im- prove the conditions of the worker shortening his hours, giving him better air, more light. I have no doubt there were Chambers of Com- merce then who said, "This is a great burden on the employer." They have since discovered that it increased the efficiency of the workman to such an extent that it has benefited both. Take the Employers' Liability Act, for which Mr. Chamberlain was respon- sible. I was in the House of Com- mons at the time, and it is one of my proudest recollections that, although I was in opposition to Mr. Chamberlain, as you may have known, I steadily supported that Bill. I gave it the most effective support, because I never said a word when it was passed through the House of Commons. I did not retard its progress by a single minute, and I voted steadily for the Bill throughout the Committee stage. That put an enormous cost on the em- ployer in the first instance, but does anyone imagine that the employer is paying that now? It is all absorbed in the greater efficiency of the worker and in the cost of the business. The Birmingham Chamber of Commerce say, "Your threepence is adding so much to our income tax." It is doing nothing of the kind. It is a funda- mental error. They do not put the cost of lubricating their machinery, of repairing their engines against their income tax. If they have a new ven- tilator under the Factory Act they do not take that out of their income tax. It is one of the errors which it is essen- tial for the continued prosperity and growth of this country that we should stamp out. All those things contri- bute to the improvement and effective- ness of the race, and everything that does that is better for employer and employed. The Best Investment Yesterday I met a very intelligent agricultural friend of mine, and I said to him, "Would you mind telling me the difference between a horse which is well-cared for and a half-starved horse?" He said he would think about it, and last night he sent a note which is so excellent that I will read it to you. This is the first horse : " A horse with good wages " that is, living under the Factory Acts " is well doctored, well stabled, and then he is always fit for work. He cannot thrive without being well fed. Coat always sleek and fine, full of heart and dash, can stand any amount of work ; if young, liable to play pranks." And then he adds a very necessary pre- caution which is rather significant : "Being well fed, the horse should be worked and not kept idle." Idleness brings on many troubles; amongst others he mentions sore feet, which is the horse's equivalent for gout. That, I think, does not apply so much to the workers of this country as to those who are well fed without working. What about the half-starved horse? " No energy, cannot stand much work, and weak ; liable to break down at any time; liable to any disease; a melan- choly creature altogether. Does not pay to keep although only consuming half what he should. A very foolish policy to half feed ; better not keep the horse at all." All that is full of wis- dom, and all you have to say is, " Do let us treat men as intelligently as we THE PEOPLE'S INSURANCE 181 treat horses." Money which is spent on maintaining the health, the vigour, the efficiency of mind and body in our workers is the best investment in the market. Doctors and the Bill What do we do to meet that ? The first thing we do in our Bill is to pro- vide adequate medical treatment for every workman in the kingdom. I am dealing here with a very thorny sub- ject, and I am warned that there are gentlemen of the medical profession present. I know there are gentlemen representing friendly societies. I hope they are not on the same side of the hall. There has been a good deal of discussion as to what they ought to be paid. At the present moment I am not going to enter into that. I had two hours' discussion with the medical men themselves the other day. I don't think there has been anything like it since the days when Daniel went into the lions' den. I was on the dissect- ing table for two hours. But I can assure you they treated me with the same civility as the lions treated my illustrious predecessor. You must remember this discussion about what they ought to be paid is an old one. I did not create it. I cannot say that I care very much for this wrangle in the sick room. It is unpleasant and may very well become .unseemly. All the same it has got to be settled. For the moment I am the buffer state. The doctors say to me, "Six shillings is not enough," and they cuff me on one side of the head. The friendly socie- ties say, " How dare you give as much ? " and I get a cuff on the other side of the head. Between them I can only receive the blows with that Chris- tian meekness which characterises politicians. The only comment I would make is this When one set of people say you are paying too little and another set of people say you are pay- ing too much, it generally means that you are about right. Friendly Societies and the Bill However, may I say this to my friends of the friendly societies? A badly paid service is a bad service, and there is no business where an adequate fair remuneration is more essential than in the profession of heal- ing. A man ought to enter your sick room with a sense at any rate that he is fairly treated, and I am confident that that difficulty can be overcome. There are unreasonable men in every profession, except that of the law. That does not command the universal acceptance which I should have ex- pected from my knowledge of that pro- fession and of the unselfish character of those who pursue it. But although there are unreasonable men in every profession and men who, if they could take the whole of the 25 millions raised, would still be unsatisfied, the vast majority of people in every trade, in every occupation, in every walk of life, are animated, I think, by a sense of what is fair, reasonable, and prac- ticable, and I am sure when we come to consider the contracts between the medical men and the societies and the health committees, as the case may be, each upon its merits, each having regard to the conditions of medical practice in that neighbourhood (be- cause that is important), and the diffi- culties, the obstacles, the hardness of the work, I, am certain we shall be able to effect a settlement that will satisfy every reasonable man. As I said, most people are really very 182 THE PEOPLE'S INSURANCE reasonable except when they are ex- cited. What the Bill Means to the Worker For the worker the Bill means no medical bills in future. And mind you, that is a very serious business. I was told of a working- man the other day who earns something under 205., and who was ill for some time, and con- fronted when he got well with a bill for 7 not a penny too much from what I know of the circumstances, reasonable having regard to the ser- vices rendered ; but I am just thinking of the worker's point of view. There he was with a good many arrears to pay. He had had to live in the mean- time ; he had had to run up other bills ; he was a strictly honest man who would pay them all to the last penny, and it was a very serious outlook for him. In future there is a medical ser- vice at his disposal. There will be no anxiety during the time of his illness about how he is to pay the man who is coming there. He will not have to elect and it is a hard election for an honourable man between starving his family and not paying the man who has rendered him honourable service. In future provision will be made under this Bill for doctoring for every worker, man and woman, throughout the whole of this land. Consumption What else? One of the most ter- rible diseases in this land is consump- tion. Read its records. You cannot do so without a shudder. Seventy or eighty thousand lives each year are carried away by it. It kills as many people as all the zymotic diseases put together. Worst of all, it kills people in the period of life when they are attaining the height of efficiency, be- tween 15 and 40. Out of the deaths between those ages in this land one out of three is due to this dread pesti- lence one-third that hideous cavity corroded into the most hopeful, vigor- ous, valuable part of human life in Britain. It is the greatest burden of any disease. There is no disease that costs nearly as much to the friendly societies. It means, I believe, 58 weeks' sickness, long lingering agony now, without a gleam of hope on the horizon. It is a burden on the rates ; it is a burden on the State, and wastes its resources. In London alone it is reckoned that four millions of wages are lost every year through consump- tion. A New Prospect for the Worker As a rule it is the worker who is attacked. As one man said, " It rarely attacks the man who pays in- come tax." I do not suggest that as a remedy. But you have industries in Birmingham and in the surrounding district which are peculiarly liable to it. Your brass working, some of your iron working. Go to Sheffield your cutlery, file-making. These trades are peculiarly liable. Now a man clings to his work as long as he can, because he knows if he gives it up there will be no one to provide for his family, so he sticks as long as he can stand it to his work, and then he lingers on through dreary months, charged with pain to himself and peril for his house- hold. What do we do in the Bill? We open a new prospect for that worker. We plant all over Britain cities of refuge to which he can flee from this avenger. We are setting a million and a half aside for the pur- pose of building sanatoria throughout THE PEOPLE'S INSURANCE 183 the country. There will be a million for maintaining them. The worker will be able to command medical atten- dance ; he will discover the disease in time ; he will be taken to these insti- tutions ; in a few months the bulk of the cases that are taken in time are cured. He will be restored to his . health, restored to his workshop, a fit, capable citizen, instead of being a wreck. That is one thing that we are doing. The Maternity Allowance What next? We have a provision for maternity, an allowance of 305., which I think is one of the most valu- able provisions in the Bill, and we are going to see that the money is spent for the purpose for which it is de- signed, in spite of one or two protests we have had from friendly societies. The money is meant for the mother, to help her in discharging the sacred function of motherhood by proper treatment, fair play, so as to put an end to the disgraceful infantile mor- tality of this country. The Allowance during Sickness What else do we provide? It is no use sending men to sanatoria, it is no use even giving them free doctoring, unless you relieve them from anxiety about their households. So we are making provision for the maintenance of the family during the time a man is under the doctor's hands. When he is fighting his struggle with the angel of death, we look after his children for him. Let him have both hands free to fight with the help of a doctor, and we will pull through in thousands of cases. The allowance we are making is not a sumptuous one to begin with, but it will grow. It will grow without a single addition or charge upon employer or employed. One of the advantages of our scheme is that it will expand, it will fructify, it will bear more fruit. This is the beginning, and the beginning of a good deal more before we have done. We are not done with fighting poverty and misery in this land yet. There is pro- vision for los. a week for the first thirteen weeks, and it is also provided in the Bill that if they like to make provision for twenty-six weeks they can do so.* An Allowance for the Infirm What happens to a man if he does not recover at the end of twenty-six weeks? Supposing he has broken down altogether, what happens to him? Then we provide 55. for him until he recovers, although he be ill for years and years, until he reaches the pension age. Ten shillings a week sick pay is not a sumptuous allowance, but it will enable a workman and his family ever after to pass the work- house door with their heads erect. Five shillings a week if permanently incapacitated no, I never said you could keep a family on that, but every man who has lived in workmen's homes and I have done it knows what it means to have a steady de- pendable allowance, even though a small one. The other members of the family will gradually adapt themselves to the circumstances. They will be able to pick a few shil- lings here and a few shillings there, and there will be always the solid foundation of 55. a week to build upon. * The Act as passed provides for the payment of IQS. a week to men and 7$. 6d. a week to women for the first twenty-six weeks. 184 THE PEOPLE'S INSURANCE Unemployment Allowance What else do we do? One of the greatest difficulties with friendly socie- ties and trade unions now is that men cannot keep up their payments during times of unemployment. What do we do ? We allow a man a large margin of unemployment without charging arrears at all. He can get three weeks' unemployment in every year and most of us get more than that without his being forced to pay arrears at the end of it, and if he likes to go on until bad times come, and just put his three weeks in the bank and not spend it every year, he can, say once every four years, when trade is very bad, get twelve weeks without paying anything if he is not earning wages, and at the end of the time we do not compel him to pay up arrears. Now that is quite a new thing in the history of provident dispensation in this coun- try. We are providing a margin of two millions when all these benefits are exhausted for additional benefits. That means you can, after your thirteen weeks at ios., or twenty-six weeks if you like, provide something for convalescence. If you want to send a workman after he has begun to recover for a week to the seaside just to pick up, you can do so. That is done in some cases in Germany. Similar rates of payment for all Then we come to a provision of the scheme that is not thoroughly under- stood, and unless I am wearying you I will refer to this very important point. There are six million working people in the country who are already members of friendly societies and trade unions and bodies of that kind. There arc seven or eight mijlions who are not. You know that if you join friendly societies at 16 or 20 you pay very much less than if you join at 40 or 50. I think if you join at 45 you pay twice as much as you would if you joined at 20. Why? The risks are greater as you get on in life, so they have to charge you more; but if you start at 20 you have only to pay the same rate through life, because you are paying something up the whole time for the evil days that come to us all. Now, what am I doing here? I am going to start everybody as if he were 16 years of age. For this pur- pose 1 am going to make everybody young to renew their youth finan- cially. I start everybody with this scheme at the rate which he would have to pay if he were a young man. That costs money. It means a great deficiency. The man of 45 and of 50 will be a loss. So I have to make provision for wiping out 'that loss, and that is where the money of the State comes in. The State comes and puts its strong shoulder under that burden and carries it. It will have to carry it for i6J years, and then it vanishes like the mist on our hills when the sun comes. It all goes; not a penny of that burden is left in the sixteen years and a half. A future Benefit What happens then? We shall then release six millions and a quarter a year for the purpose of increasing the benefits to everybody. There are ad- vantages in this scheme for the old. The State sees them limping along with their burden, getting more and more tired and weary as they go along, and the State says, " Let me help you. " There are advantages for the young man. He will go on paying, paying, THE PEOPLE'S INSURANCE ,85 paying ; if he is ill he will get his doctor and his los. a week and his sanatorium if he is attacked by con- sumption; but in sixteen and a half years' time he will come in for an addi- tional harvest. That is his advantage. Young and old come into this scheme. We have got benefits for all, and we have lifted a weight of misery and of wretchedness which was crushing mil- lions of people in this land. Friendly Societies' Benefits "Oh, but," says my friend in the corner there, "what about the man who has already been paying since he was twenty years of age? Are you only to give the same thing to him? " Well, I have a very good Scriptural warrant for that the man who came in at the eleventh hour. He got the same sickness pay at the eleventh hour. People have asked me, " How is it you can't do it for 66 and 67? " Well, even the parable did not give it to the man who came in at half-past eleven. What am I doing for the friendly society man who is already in? Let me tell my friendly society supporters I think I can call them that I do not think they fully realise what has been done for them. There are some of them under the impression that they are going to pay the 4d. in addition to the present contributions. That is not the case. You start under this scheme by paying less than you are paying now. I hope you do not mind, because if you do I am quite prepared to let you go on paying exactly the same and get larger benefits. But more than that, if you have been in a friendly society for 25 years and the same thing applies, of course, on a smaller scale if you have been for 15 or 20 or even 10 years you have always got credit to your account. What happens to that? I release that credit, because I take over the whole burden on the State scheme. What happens to the money? Go to your friendly society and say, "We want additional benefits," and you can get them. State Benefits Let me show you. Are there many members of friendly societies here? You are just the gentlemen I want to talk to. Suppose you joined at 20, and you are now 45. The same thing applies if you joined at 16 and you are now 41. You should pay 2s. 2d. a month or 6jd. a week. What do you get for that? You get a doctor and you get 105. for six months. For the moment you will find that it does not very much matter. I am putting the case at its highest. If you say three months so much the better, but I will take it at six. You get 55. for the remainder; your next-of-kin will get 10 on your death ; you get $ on the death of your wife. I have taken one of the friendly socie- ties ; it may be that in your particular society the benefits are adjusted in a different way, but it all comes to the same thing. Now, you are 45. What will happen to you under the State scheme? You will pay in future not 25. 2d. a month, but is. qd. 4^. a week. You will pay therefore lod. a month less than you are paying now. What will you get for it? You will get your death benefits. I am not insuring death, but in order to keep your death benefits in your society you need not pay in future. If you have been in your society for 25 years and have accumulated resources you need not pay more than the 4^. which I am i86 THE PEOPLE'S INSURANCE asking. You will get not los. a week, you will get more; that is to say, if your society is completely solvent. Everything depends upon that. If it is not, that is a different matter. But you will get 135. a week for 26 weeks, and afterwards you will get not 55. but 65. 6d. a week. If your society is not absolutely solvent and if its funds are not altogether available you will reduce that amount by perhaps is. a week, but you will get more. You will be paying less by lod. a month, and you will get more than you are getting now. That is the condition you will be in under this scheme. The State's and Friendly Societies' schemes compared Is there anybody here insured for 125. a week? Well, I have something to say to you. You are paying roughly about 2S. qd. or 25. 4^0!. a month. Well, if you have been pay- ing for about 25 years, what do you pay in future? You will pay your qd. a week, is. 4^. a month ; is. less a month, but you will get bigger bene- fits. You ought to get instead of 125. a week 145. a week; instead of 6s. for your second period you will get 75. You will be paying less per month by is., and you will be getting larger benefits in future. That is your con- dition. I worked it up to 155. ; is there anybody insured for 155.? Well, I have a word to say to you. You are paying now per month 2s. gd. In future mind you, on the assumption that you have been in your society for 25 years paying regularly you will pay is. 4^. a month. You will be pay- ing is. 5^. a month less. What will you get? You will get i6s. a week, and instead of 75. 6d. you ought to get 8s. a week, and you will get, of course, your death benefits if you have accumu- lated enough reserve, but you need not pay for those, and all you will be paying is is. $d. instead of 2s. gd. The minimum State Benefit Again I warn you, it is all on the assumption that the societies are per- fectly solvent, and the funds available, and I can well understand friendly societies saying, "\Ve will be a little cautious at first, we will give a little less." But nothing will prevent your getting for is. 4^. a month the $d. which I am charging equal benefits and even greater benefits if you have been in your society a regular contribu- tor for 25 years. " We are realising credit which you have created." What happens to the man who has been 20 years, 15 years, ten years in membership? He will also get some- thing, less of course, because his re- serve is less, but what I want to point out to you is this we are realising credit which you have created through your thrift or industry or foresight; we are giving you the full benefit of it, and we are adding something on the top of it. Local Health Committees I just want to say this one word. I am glad we are able to do something for those who are sick, for those who are out of work. I regret that I can- not to-day explain that portion, be- cause time will not permit, but the one thing in the scheme which I lay greater stress upon is that we have got provision to prevent disease. We are setting up Local Health Committees, and do not you allow anybody to cajole THE PEOPLE'S INSURANCE 187 or bully or misrepresent you in regard to this. They are the most fertile and hopeful provisions in the Bill. There you have got them as a great agency for prevention. They do not take away the function of any council, municipal, county, or district, but they are there to see that those councils are doing their duty. They will organise instruction on the prin- ciples of health a most important thing. Instruction in Health. Principles It is amazing the amount of ignor- ance that exists about the simplest rules of health. Why? You cannot persuade people that it is life for them to have an open window, that air is meant to breathe and- not to keep out, that you want a constant renewal of its freshness. There will be instruc- tion on the principles of health and of diet, the dangers of excessive drink- ing all these things will come in. But we shall also entrust to these com- mittees the function of seeing that the laws of this land with regard to health are enforced. A Lesson in Self-Government There is nothing more marked in. this country, in most countries, than the contrast between the relentlessness and the rigour with which the laws of property are enforced and the slack- ness and sluggishness with which the laws affecting the health of the people are administered. These health com- mittees, these societies will be adminis- tered by the men themselves. It will be a great lesson in self-government. It will be the first time the workers of this country have been really federated for the purpose of administering affairs which are essential to their very happi- ness and comfort. And the Local Health Committees will also have representatives. The Eeek of Insanitary Property The protection of property in this country is the most perfect machine ever devised by the human brain. The guardians of property patrol every street, and if the transgressor eludes their vigilance he is pursued to the ends of the earth. Continents cannot hide him, the waves of the ocean can- not cover his tracks. They would have caught even Peter the Painter had not he been protected by the certificate of character given to him by Mr. Justice Grantham. But compare that with the way in which the Public Health Acts, the Housing Acts are adminis- tered in this country. We have had Public Health Acts in this country for years and years, long before I was born, and that is getting a long time ago. We have Housing Acts on the Statute Book. And yet there is no city or town, hardly a village, without the reek of insanitary property. The First Thing We Ought to Do I want to see the law protecting pro- perty yes, but I also want to see it protecting the worker's home. I would treat the man who receives rents or ground rents from insanitary dwell- ings which kill little children I would treat him as I would the receiver of stolen property. They won't have very much to say in future. Look at the minuteness with which the most in- significant property is protected. Take the game of the land. Why should not life, health, be protected with the same ruthlessness, with the same re- morselessness, with the same care? That ought to be our concern if we are goiag to make this land greater G 2 i88 THE PEOPLE'S INSURANCE than it is. If we are going to make it worthy of the splendid Empire of which it is the centre, if we are going to make it worthy of the position in the story of humanity which it ought to achieve, the first thing we ought to do is to cleanse Britain of the foul habita- tions which spread corruption, disease, and death in our great cities. Not a Final Solution I never said this Bill was a final solution. I am not putting it forward as a complete remedy. It is one of a series. We are advancing on the road, but it is an essential part of the journey. I have been now some years in politics, and I have had, I think, as large a share of contention and strife and warfare as any man in British politics to-day. I remember this beautiful building wrecked. This year, this session, I have joined the Red Cross. I am in the ambulance corps. I am engaged to drive a waggon through the twistings and turnings and ruts of the Parliamentary road. There are men who tell me I have overloaded the waggon. I have taken three years to pack it carefully. I cannot spare a single parcel, for the suffering is very great. There are those who say my waggon is half- empty. I say it is as much as I can carry now. There are some who say I am in a great hurry. I am rather in a hurry, for I can hear the moanings of the wounded, and I want to carry relief to them in the alleys, the homes where they lie stricken. And I ask you, and through you I ask the mil- lions of good-hearted men and women who constitute the majority of the people of this land, I ask you to help me to set aside hindrances, to over- come obstacles, to avoid the pitfalls that beset my difficult path. Answers to Questions. Life Insurance Agents Replying to a number of questions, Mr. Lloyd George said that they were not interfering with the business of life insurance agents. There was no pro- vision for death in the measure at all. Some people had criticised them for that, but they had given an under- standing that they would not do it, and they redeemed their pledge. He wished to point out that there was nothing to prevent any society that was dealing in death benefits organising a sickness section if they liked, so that as a matter of fact agents for societies in this country would find that they would be in a much better condition than before the Act. Dividing Societies With regard to dividing societies, the Chancellor said that if they chose to organise a section of their society under the Bill they had the same right to come in as any other society. W 7 hat they could not allow was that any part of the provision which was made by the State under the fourpenny, three- penny, and twopenny payments should be divided at Christmas. THE PEOPLE'S INSURANCE 189 II. THE INSURANCE BENEFITS AND HOW THEY WILL OPERATE. (From a Speech delivered by the RIGHT HON. D. LLOYD GEORGE in Whitefield's Tabernacle, on Saturday, October itfh, 1911.) The Three Causes of Poverty I plead for fair treatment for a measure which, in my judgment, will do more to hinder or assuage human misery than any Bill carried by the Legislature since the abolition of the Corn Laws. The three principal causes of poverty and destitution in the homes of the industrial population of the coun- try are ill-health, unemployment, and drink. What does this Bill propose to do for the first two, nay, even for the third? It makes provision for fifteen millions of men and women engaged in industrial occupations in this country a provision that will save multitudes from falling into ill-health, that will diminish the pain and perils of sick- ness for many more, and that will re- move to a very large extent the desti- tution, the penury, and the privation which follow on the heels of sickness in the homes of the people. In addi- tion to that, it makes a provision against the distress which follows un- employment in two millions and a half of the homes of this country. The Bill as a Check upon Alcoholism Now I will assume at the present moment the entire burden of sickness amongst the industrial population falls upon the shoulders of labour. In future more than half of that burden will be shouldered by others. Inci- dentally, it combats the evils of drink, for there is the provision in the Bill whereby the organisations which have the control of the health provisions of the measure shall have, as one of their duties, to instruct the people on the evil effects of alcoholism upon the health and upon the constitution. The Opposition to the Bill I have only just summarised at the beginning the character of the measure which I have come to say a few words about and to explain further. The Bill at first was received by all sections of the Press and by all parties with enthusiastic acclaim. Even now all parties do what they call "accept the principle of the Bill." I will tell you by and by what they mean. Gradually the clamour of interests was heard. You cannot embark on any reform which is worth undertaking but you come across vested interests some- where, and there is only one way for a reformer, and that is to fight his way pertinaciously through them. That is the job I have in hand to-day, and will probably be engaged in, not only with this Bill but in other Bills, to the end of my days. And I am here to ask your help. The Bill has been assailed by more misrepresentation than any measure of modern times, and that is saying a good deal, for perhaps you will recollect I put a Budget through. The "Accepted Principle" Whenever I attempt to explain and write a letter or make a speech to point out the advantages of the Bill, they 190 THE PEOPLE'S INSURANCE say, "That is not the point, because we accept the principle. You should dwell on its shortcomings." The prin- ciple of the Bill is universally accepted, and I now know what is meant by that. It means that whenever you accept the principle of a Bill you have no right to refer to its benefits, and you must confine yourself in any allusion you make to it strictly and rigidly to its shortcomings. That is a grotesque method of considering a Bill. There is one rather fatuous journal which went so far as to declare that to refer to the advantages of the Bill was im- moral advocacy ; so that, if you want to maintain the reputation of being virtuous citizens, if anybody asks you a question about the Bill what bene- fits a workman gets under it you must say, "That is an improper ques- tion, and no respectable father of a family can answer it, but since you have asked me a question about the Insurance Bill I will give you a list of the faults which have been discovered in its drafting." - And its Effect The effect of that on some minds is this if by some process I am going to get 4^. a week from workmen, 3^. a week from employers, 2d. a week from the taxpayer fifteen millions nobody would get anything. Fifteen millions a year collected, and nobody shall get anything. That is the sort of impression made on my mind by criticisms I have been reading in the public Press. The Unprovided Workman Now I am going to tell you exactly what the workman gets and also what he contributes. I will take two classes of workmen one the workman who is not a member of a friendly society, and another who is a mem- ber of a friendly society, and I will tell you what happens to both. I will start with the man who is not a mem- ber of a friendly society. How many men and women are there in this coun- try who have by joining friendly socie- ties made provision for the dark days of sickness? According to Mr. Watson and he is about the greatest author- ity in the country there are not more than four and a half millions. There are fifteen millions about of work- ing men and working women, so you have only got provision for sickness made in so far as one-third of these are concerned. I know you have building societies and co-operative societies and savings banks, but very often you will find that the best customers of these are the men who have been paying regularly into friendly societies, and they are trade unionists. Reasons at the Basis of the Bill Why are there so many unpro- vided for? I will give you three reasons which it is important that every man and woman should go into, be- cause they are at the basis of the Insurance Bill. (1.) Lack of Foresight to Insure During Youth One is that when a man is young and vigorous, and is earning not merely enough money for his daily needs but has something to spare every week, it is difficult for him to realise that the time will come when not merely his weekly wage will be barely adequate, but when it will be insuffi- cient to provide for the days when he THE PEOPLE'S INSURANCE 191 is sick and unemployed. I have got a diagram showing what the average of sickness is at different ages, and I can tell you it is very interesting. What is very remarkable about it is that in the first ten or fifteen years the average sickness is just about the same. I dare say that there are many of you in this meeting who have gone on to thirty or forty years of age without ever consulting a doctor and that is the experience of a good many people. (2.) Higher Bates When Aged Then suddenly you find how ill- health leaps up. Well, now, it is diffi- cult to persuade men in those days of low averages of sickness that the days of the high average are coming, and that every reasonable man, every thoughtful man, will make some pre- paration for them. You cannot per- suade human nature to look a year ahead without some difficulty, but to ask them to look ten, twenty, thirty, and forty years why, I say, it is one of the greatest triumphs of organisa- tion that the friendly societies and the trade unions between them have per- suaded five millions of people in this country to look ahead so far. Well, when they begin to realise the mistake they made in not joining young it is too late, because the friendly society rates by that time have gone up. You join young, your rate is low. Join late, your rate is high. You are so much nearer the rainy season. It is too late then, and the man who is earn- ing a weekly wage and has to provide for a wife and growing family cannot afford to pay a higher rate for joining a friendly society than the other work- man who joined when he was ten or seventeen. (3.) Difficulty of Keeping up Contributions Now what is the third reason? and that is the greatest reason of all. The difficulty of keeping it up. Unemploy- ment comes. He has got to pay regu- larly to his friendly society ; and I want you to bear that in mind. He has got to pay regularly to his friendly society. He cannot. He tries to keep that up. He breaks down. He is out of work for a month, two, three, and at the end of it he has other arrears to think of. He has run up a bill at the grocer's ; he has run up a bill for the necessaries of life for himself and his children; there is rent owing. He has g-ot arrears to meet. He has got to liquidate those first before he pays up the arrears of his friendly society. There are mil- lions of people in this country who have been in friendly societies and have broken down. Insecurity of Certain Friendly Societies Sometimes too often drink is re- sponsible. What is the other reason? Men have joined friendly societies which have become bankrupt. Look at the reports of the Registrar of Friendly Societies in this kingdom year by year, and you find societies have been wound up during the year. Here is a list; 1909 is the last return; 155 societies ^dissolved. Look at the assets. They have practically nothing. They have come to the end of their tether. In a single valuation quinquennial valua- tion 155 societies had to be wound up. Hundreds and thousands of mem- bers have paid all their lives. There is an old friend of a friend of mine who is present on this platform. He had a friend who had been paying all his life in a friendly society and just when old age was overcoming him and he could not go on working and was looking 192 THE PEOPLE'S INSURANCE forward to getting a few shillings a week from his friendly society he re- ceived notice that it was wound up. He had to go to the workhouse. 10,000,000 Workers Unprovided For Don't mistake what I am saying. There are friendly societies in this country that I have no hesitation or doubt about are strong and powerful, that can meet all their liabilities, and are taking steps now to strengthen their position. I am only wanting to give you a reason why there are so many people in this country who are unprovided for by friendly societies. For one reason and another there are ten millions of working men and work- ing women unprovided for. The Case of the Man Who is Unprovided For Let us follow the career of that man who is unprovided for. Take any wage you like. I think the average wage in this country is about 245., and that is the highest average in Europe and much too low at that. What happens to that man? He has no friendly so- ciety. He is a married man with a family. Let us follow him. He feels out of sorts. He is ill. He does not care to consult a doctor, because if he consults a doctor he will have to pay the doctor, he will have to pay for the medicine which he prescribes, and per- haps half a day's wage goes in those two operations. He generally buys something at the chemist's. He goes on and gets worse. Why ? He cannot afford to leave off. He has got a wife and family to think of, and he hangs on and hangs on as long as he can " For men must work And women must weep, And there's little to earn And many to keep." The Disaster of Illness The result is that the illness which might have been cured in a few days becomes a serious one. What happens to him then? He does not go to the parish doctor. He very often in some districts cannot do it without entering the institution, and a workman, to his honour be it said, does not like to wear the pauper's garb. And so another doctor is called in. A bill is run up. What about food? The last few shillings of the household are spent upon food for the necessaries of life. Then the credit of the household is ex- hausted. If a man has been paying regularly to his tradesman no decent tradesman ever cuts him off because he is ill. But still there is a limit. And, after all, tradesmen have lost a good deal of money by that operation. The "Poor Man's Banker" Steps In What is the next step ? It is the step too familiar in many of our great cities. Articles are pledged with what is called the "poor man's banker"; the wife has to dispose of articles, either of adornment or of furniture ; one after the other they are disposed of just in order to rescue the little household from the grip of hunger and to help her mate to fight the grim enemy. There are two things that may happen two alternatives. If the battle is lost the wife faces the world with nothing but heavy debts and a sore heart. If the man pulls through he has arrears of rent, he has arrears of tradesmen's bills, he has a heavy doc- tor's bill, and I shall give you some illustrations of that before I am done. And he generally returns to work too soon. There are hundreds of thou- sands of people in this country who never through life overtake the debt THE PEOPLE'S INSURANCE '93 incurred during- illness. They just drag along- through the swamp, with heavy feet, unable to get back to the firm high road right to the end. Consumption As a matter of fact, ill-health is ac- countable for a gigantic mass of penury, misery, and pauperism in this country. Look at the pauper returns. Ill-health has been first among the causes of pauperism in the land. Let us take another contingency of a man with no provision. He has a bad cough ; it troubles him night and day. He is wasting ; his strength is waning ; he clings on to his work because he cannot afford to fight for his life. At last he has to go to a doctor. The doctor examines him and finds that he has been attacked by one of the .most terrible diseases in the world a disease which carries away 70,000 people every year in this country, and a disease which always attacks people in the vigour and strength of their energies. Consumption kills the young, the vigorous, the people who ought to have the hope of life in front of them. Most of these casualties are between 15 and 40. A Disease of which the Poor Man Can not be Cured What has the doctor to say to him ? This is the first thing I want to get in your minds. The moment of his ex- amination the doctor knows what is the matter with him, but he cannot recommend the one treatment that will save his life. Why? Because he knows the poor fellow cannot afford it, It is no use telling a workman that he must go for three or four months to a sanatorium. How is he to get there? There are very few of them in this country ; for all classes there are only a few thousand beds. Therefore the doctor knows that whatever he does within the limit of the man's power, his patient is doomed, and all he can do is to prescribe some medicine to him, which will just for a short time, per- haps, arrest the evil, but the end is inevitable. The Case of the Man in Chronic Ill- Health Let us take another case a man who breaks down prematurely alto- gether. There are many in this coun- try and in every country the man who gets into a state of chronic ill-health and cannot get on with his work. Un- less he has some provision made for him there is nothing for him but the workhouse or the charity of the parish. The Case of the Woman in Childbirth Those are three cases. And there is the case of childbirth, where in so many hundreds of thousands of cases women in this country cannot receive proper nursing, nourishment, and care in the discharge of this sacred function of motherhood. What ought to be done not merely for her sake, for the sake of the child, for the sake of the father, for the sake of this land which depends upon these poor little children? Give the little one a fair start in the obstacle race which he has got to run through life, hard enough, difficult enough, full of pitfalls give the little chap a good start at any rate. The Bill provides Free Medical Attend- ance I have just presented to you in rough outline the sort of contingencies a man may have to face who is utterly un- provided for. And there are ten G* 194 THE PEOPLE'S INSURANCE millions of them in this country. What happens to him under the Bill? The first thing- that happens to him under the Bill is that he can command free medical attendance. If he is ill or feels there is something- the matter with him, he need not wait until he becomes seri- ously ill because he cannot afford to pay the two shillings or half-a-crown, or whatever may happen to be the charge in that particular district. He has his society doctor to go to. Freedom in Choice of Doctor Another thing established under this Bill is this he can have a doctor of his own choice. He is not obliged to go to Dr. A because there happens to be a majority in the club who prefer A to B. He puts his confidence in B, who has pulled him through before, or he has pulled through somebody he liked better than himself, or he says, "This is a man I trust in." And faith is nine points of all healings spiritual, men- tal, physical. So we say to him, "Go to the doctor you believe in." The very sight of some doctors makes you ill, and if you have been harried as much by them as I have been you would find it very difficult for any doctor to pull you through. On the other hand, at the mere sight of some men well, you feel better the moment they come into the room. That is the doctor for you, and under the Insurance Bill you can get him. Yes, but what a fine thing it is to get the doctor you want and get somebody else to pay for him. That is the Government Insurance Bill. Prevention better than Cure That is the first thing that happens. He can go to the doctor he pleases, and every doctor who chooses can go on to the panel. So there is not merely free choice for patient, but for the doctor as well. So we are going to make this really a free country. Very well; he goes to the doctor, and the doctor examines him. He prob- ably may find that the man has come to him just in time, because there will not now be the same reluctance to go to the doctor in time, seeing you can send the bill elsewhere. The doctor may give something that just staves off a serious illness. That is why the Bill will avert illness in hundreds and thou- sands of cases that might have de- veloped into something- grave, and, after all, it is far better to avert it than to cure it. Sickness Benefits Supposing he fails to cure it the first time. He says : " You had better go home, and go to bed." "But," says the workman, "there will be the big bill you will run up against me." " Not a penny," the doctor will say. "But what happens to my wife and family? " "You will get," the doctor replies, "during the whole time you are ill you will get IDS. a week for thirteen weeks from the first day onwards." " But supposing it lasts longer? " " If it lasts the rest of your natural life you will get what the old-age pensioners get for the rest of your days." The Rent Paid, at any Rate Supposing you break down at 35 or 40, and become a helpless invalid, you will get your old-age pension to the end of your days and free medical at- tendance. Not much, you may say. It is better than nothing, and that is all he had before. Five shillings a week for a man for the rest of his days. What is that? W T ell, I will tell you what that does. When the woman turns to be the bread-winner and the children are beginning to help, the five THE PEOPLE'S INSURANCE 95 shillings a week pays the rent at any rate. And what she earns and the children earn may go for sustenance. It is something- to get the rent out of the way. 10/- a Week only a Beginning More than that, the ten shillings a week is to be a beginning. We have got a balance of two millions in hand, and a well-managed society can bring that up to 12 s. 6d. a week. What does that mean ? I do not say it does every- thing, but it helps during a time of stress and strain, and at any rate when a man gets well, instead of having to face arrears of rent because that could be paid at any rate out of the ten shil- lings a week he has then got less to pay than he had before, and he has had the best doctor for him on the panel to cure him. A Case from Blackburn A man wrote me the other day from Blackburn ; the statement was verified by a lawyer, who g^ave his name. And this is what he said about a Blackburn man in a cotton mill there. He was a man earning 215. to 225. a week. He had a most protracted family illness himself, his wife and he had two boys of 26 and 24 years of age who seem to have broken down in health alto- gether, and to have been unemployed for some years. They had had five doctors, one after the other, in the house. The total bills came to ^87 165. for a man who was earning 215. to 225. a week. He was paying by weekly or fortnightly instalments, and here is the statement which the old man himself sent me : "I owe nothing," he said, "only ^3 125., and my doctor's bills, 1 6s., and have paid regularly. I have had to stay off work two weeks being ill and not having help." One doctor had put him in the county court. The debt and costs were 6 ijs. The doctor did not press very hard when he got into court that ought to be said for him. There was an order for the old man to pay 2s. a month 6d. a week for one doctor's bill. Why, for 4^. a week he could have had a doctor free, 105. a week during his illness, 55. a week if the illness lasted three months, and he would have had more than that. The two boys would also have had free doctors, and each of them IQS. a week, so that during the time they were ill the house would have re- ceived i i os. a week and a free doctor. That is what would have hap- pened under the Bill. The Example of Germany I will show you another effect of this Bill. I hope I am not wearying you, because I want you to follow the Bill and judge it by what it is, and not by what is said about it. I ought to say this. I am prepared to stand by any statement which I make, and I ask you afterwards to view the Bill itself as amended in the House of Commons, and find out whether any statement which I make is not strictly accurate find it out for yourselves. Here is another effect of the Insurance Bill. There are men in this country and there are a good many of them who have saved a little money, and put it in savings banks, building societies, and other institutions. They are saving up for the time when they cannot work and earn money. But they don't want that money to be dissipated by the small hindrances that happen to a man before he begins finally to break up. Well, now, let me show you what has 196 THE PEOPLE'S INSURANCE happened in Germany from the effect of insurance. There was a document published the other day, a very able report from one of the ablest Consuls of the British Empire, Sir Francis Oppenheimer, British Consul at Frank- fort. That document has been par- tially quoted in the papers. They quoted one passage that they thought would damage the Insurance Bill, a passage which states that the em- ployers in Germany were growling. That is the only quotation they gave. They do not say what they might have found if they had only gone on a few lines that the employers and the workmen in Germany pay more than twice as much as we call upon them to pay under the Insurance Bill here. What more does this document say? And this is most important. It points out that the effect of the insurance scheme in Germany is that it has put an end to the withdrawal of money from the savings bank, be- cause people are able to tide over their illnesses with the allowance of five, six, seven, eight, and ten shillings which they get from the insurance fund, and the free doctoring. The Effects of the Sickness Benefits Consider what the effect of that is. Men put money by for a rainy day, but many a sum of money put by for a rainy day has been dissipated by summer showers before the winter season draws nigh. And the one effect of insurance in those cases is that a man is able to keep his little money in the bank and not withdraw it until the real time of heavy trouble comes. He goes to his insurance fund, gets his ten shillings a week, goes to the doctor and gets that paid out of the insurance, and it is quite unnecessary for him to send his wife to the bank to withdraw his little savings from that quarter. The Case of the Consumptive under the Bill Let me tell you what happens to the consumptive worker and there are in this country at the present moment be- tween two and three hundred thousand people suffering from this fell disease. A man goes to the doctor; he is examined. The doctor discovers at once that he is attacked by tuberculosis, and he says to him : " You must knock off work at once. You must go to a sanatorium." The workman says to him : " You are mocking 1 me. How can I go to a sanatorium? I cannot pay." He cannot pay to go to a great building in the country where he gets the best nursing, the best doctor- ing, the best food for his case, open air, lives practically in a sort of con- sumptive hotel, a first-class hotel, for three or four months. So the poor man who is earning 205. or 245. a week is told : " You have to go for four months to a first-class hotel." He will say : " You are mocking me. How can I go ? " And the doctor will say : " Haven't you heard? The Government are finding a million and a half by the Insurance Bill to build sanatoria throughout the country. They are raising a million of money more out of the Insurance Fund to keep it up. They have also a provision in that Bill, by which, if that is not enough, they will find half of the balance. " And then the workman will say : " What happens to my wife and children ? " There again the doctor will say very reluct- antly I have no doubt " In that In- surance Bill of that inhuman monster the Chancellor of the Exchequer, you will find a provision of ten shillings a week to keep the wife and family from THE PEOPLE'S INSURANCE 197 starvation during the time you are getting" cured." Sanatoria for Children as well as Adult At the end of three or four months he conies back cured. In the early cases the vast majority of people who are sent to these institutions come back cured. More than that. He is trained to fight the evil for the future. He comes back a trained soldier to repel the deadly tubercle that invades his home. He knows now how to keep his little children free from it, the wife and the family ; he knows how to fight it and drive it out. That is what this Insurance Bill does. But it does more than that. We have got an amend- ment in now and I am glad the House of Commons is prepared to support the Government, for they have the command of the finance by which not merely can a man himself go to these sanatoria, but his wife and his children. And there you are. A little chap who under the old system would have languished away amid the torturing anxiety of his parents, a source of peril and infection to all those who love him best what happens to him now? In three months he comes back a plump, chubby, rosy-cheeked little fellow, leap- ing with life and energy and joy among his comrades ; and he has to thank the Insurance Bill for that. I ask you here, frankly, have you read in any of the newspapers which criticise the Bill anything that would give you any notion that this is what it would do? I The Maternity Benefit Let us go further. I have already pointed out to you that if a man breaks down permanently he gets 55., which is an old-age pension, for the rest of his days. But not only that. I re- ferred to the case of maternity and child-birth. A million children are born every year in this country under conditions which do not conduce to the welfare of these little children, which are disastrous for the future of the race, and which are cruelty inflicted on the mother. What happens? Every wife of an insured person at child-birth gets 305. from the Insurance Fund to provide nursing, nourishment, care, somebody to look after her household. It will make a gigantic difference, not merely to the poor woman, but to the child as well. Working women who are insured persons themselves and there are many of them and who are the wives of insured persons, will not merely get the 305. of the husband, but the 305. that comes from their own insurance. So that they will get ^3. Why? Because you want to offer every inducement to them not to go too soon back to their work. A Contributory Scheme How is all this to be paid for? You cannot do it for nothing. We have said from the start that we proposed that the scheme should be a contribu- tory scheme, that all classes should contribute to it, as all classes will bene- fit by it, because it is not merely the workmen who will benefit by it. The community will benefit by it. In3us- tries will benefit by it. The workman is a more efficient man when his vitality is not depressed by anxiety and worry, and when he is not in a condition of chronic under-health, a very good phrase for hundreds of thousands of persons at the present moment. It will cost gd. per week per person. The benefits for a woman are less. She gets 75. 6d. per week instead of 105., but gets 55. during the whole of the time after that, and other benefits in 198 THE PEOPLE'S INSURANCE the same way. The workman pays 4 the boy of 1 6, but its value to persons above that age increases gradually with age. It is, of course, greater at the higher ages, and for this reason a somewhat reduced insurance is given to persons over 50 years of age and persons over 65 are specially treated. The effect of the provisions of the Act may be summed up as follows. The insurance given will be worth on the average qd. a week. In the case of some individuals it is worth more. In other cases it is worth less. In no case is it worth less than 7^., the con- tribution payable jointly by the em- ployer and the workman. Q. : You say "workman." Does what you have said apply also to women ? A. : Yes, with the necessary modi- fications of the figures. The ordinary rate of contribution is 6d. ; the State proportion of the benefits is a quarter of the whole (that is to say, one-third of the amount provided out of contribu- tions); and the deduction for Reserve Values is i%d. Putting it in the form of a sum, as we did above, it will be seen that the State grant is here, also, on an average, equal to 2d. y thus 4 of 4J + J of i = 2. 4. INVESTMENT BY SOCIETIES. (Section 56.) Q. : How much of the funds con- tributed under the Act may the Socie- ties themselves invest? A. : How the funds contributed under the Act are placed to the credit of Societies was explained in the answer to a previous question. Such part of these funds as is not required for current expenses will be available for investment. Four-sevenths of the amount available for investment in THE PEOPLE'S INSURANCE 281 respect of the contributions of men and one-half of the amount available in respect of the contributions of women will, if the Societies so desire, be paid over to them for them to in- vest themselves. The remaining three- sevenths, or one-half as 'the case may be, is retained for investment by the Commissioners. (Section 56 (i) (a) and (b).) Q. : In what manner are the Socie- ties allowed to invest these amounts? A. : They can choose either of two courses : (1) They may themselves invest the money through their trustees in any of the investments allowed by the Act for the purpose, choosing the investment after considering the rate of interest and the safety of the money so placed. (2) They may, on the other hand, leave the money in the hands of the Commissioners, who will act as their trustees for the purpose of investing in such securities as they may direct. The only difference between these two methods is that the Commissioners instead of the trustees are responsible to the Society for the safe custody of the funds. In either case Societies will gain or lose by the fluctuation in value of the securities. Societies may, however, if they prefer it, leave the whole of the money (the four-sevenths as well as the three- sevenths) in the investment account. Societies have then no further concern with the value of the security in which it is invested; they can draw upon the money when required, and will re- ceive the interest prescribed by the Commissioners. Money so left is simply in a deposit account for the Society. THE DUTIES OF EMPLOYERS UNDER THE ACT. PART I. GENERAL. 1. This memorandum deals with the duties of employers under the Health Insurance provisions of the National Insurance Act, 1911, in respect of per- sons employed by them. It does not refer, therefore, to the payment of con- tributions by such persons during un- employment, nor to the payment by them of arrears, nor to "voluntary con- tributors," nor to the duties of em- ployers under the Unemployment In- surance provisions of the Act. 2. Under the Act the duty of paying contributions is placed upon the em- ployer in the first instance. He has, save in certain exceptional cases, a right to recover part of the contribu- tion from the worker, but it cannot be too clearly understood that the em- ployer pays the full contribution in the first instance, and that he cannot re- cover the worker's share, by deduction from wages or otherwise, unless he has first paid it. PART II. PERSONS IN RESPECT OF WHOM CONTRIBUTIONS MUST BE PAID. 3. Every employer is required to pay contributions under the Health Insur- ance provisions of the Act, in respect of all persons employed by him who are between the ages of 16 and 70, unless the employment falls within one of the classes which are expressly excluded K THE PEOPLE'S INSURANCE from the compulsory provisions of the Act. (See Part III.) 4. It does not matter for how short a time the worker is employed, nor for how many employers he works, nor whether he is paid by time or by the piece. Nationality makes no differ- ence; contributions must be paid whether the worker is an alien or a British subject. 5. In cases where the worker receives wages or other money payments, not from his employer but from other persons, the employer is still made re- sponsible for the payment of the con- tributions, e.g., the owner of a cab who lets it out to a cabman is responsible as employer for the payment of the contributions in respect of the cabman, and the employer of a waiter whose earnings depend entirely on the " tips " he receives is under the same liability. 6. There are two classes of employed persons in respect of whom the em- ployer must pay the proper employer's contribution, but who, not being in- sured persons, are not liable to pay any contributions themselves. They are : (i.) Persons who from the nature of their employment would be compul- sorily insured but who produce to their employers a current " exemption certifi- cate." (2.) Persons becoming employed after the age of 65 who have not pre- viously been insured under the Act and who were under 65 on July 15, 1912.* The employer of a person who falls within either of these classes is required to pay the same contributions as would have been payable as employer's con- tributions if the worker had been an insured person. (See Part VIII.) * Contributions have to be paid both by em- ployer and employed, in the case of persons who are 65 or over on July 15, 1912, and are then or subsequently become employed. PART III. EMPLOYED PERSONS WHO ARE EXCLUDED FROM COMPULSORY INSURANCE. 7. No contributions are required to be paid in the following cases, unless the Insurance Commissioners issue a Special Order bringing any of such per- sons into compulsory insurance. (i.) Persons employed as apprentices without wages, or learners receiving no wages. (2.) Persons employed by the occu- pier of an agricultural holding without wages. (3.) Children employed by their parents without wages, and persons who are maintained by their employer without wages. (4.) Wives employed by their hus- bands, and husbands employed by their wives. (5.) Outworkers who are the wives of insured persons and are not wholly or mainly dependent for their livelihood on their earnings as outworkers. (6.) Persons casually employed; ex- cept that persons have to be insured who are casually employed for purposes of the employer's trade or business, and that persons who are engaged or paid through a club for the purposes of a game or recreation must also be in- sured. (7.) An agent paid by commission, by fees, or by share in profits ; but he must be insured if, being under contract of service, he is mainly employed by one employer and is mainly dependent for his livelihood on one employer. (8.) Persons employed at a rate of more than 160 a year; but all per- sons engaged in manual labour must be insured, whatever their earnings are. (9.) Elementary school teachers who have accepted the Elementary School Teachers' Superannuation Act, 1898. (10.) Employment of a kind which is THE PEOPLE'S INSURANCE 283 ordinarily adopted as subsidiary em- ployment only and not as the principal means of livelihood, if so specified in a Special Order issued by the Insurance Commissioners. (u.) The following persons also will be excepted where the Insurance Com- missioners certify that the terms of their employment secure to them bene- fits in sickness and disablement of at least equal value to those given by the Act: (a) Persons in the employment of the Crown. (b) Persons in the employment of local or other public authori- ties. (c) Clerks or salaried officials in the service of a railway or other statutory company who are entitled to rights in a superannuation fund estab- lished by Act of Parliament. PART IV. ARRANGEMENTS FOR PAY- MENT AND COLLECTION OF CON- TRIBUTIONS. (i.) General. 8. The employer is required to pay in the first instance the worker's contri- bution as well as his own. 9. A weekly contribution is payable by the employer for every calendar week during the whole or any part of which the worker has been employed, but not more than one contribution is payable for any one week in respect of the same person, and no contribution is payable by the employer for any calen- dar week of employment during which no services have been rendered and the worker (a) has received no re- muneration, or (b) has been in receipt of sickness or disablement benefit for the whole or any part of the week. The expression "calendar week" means the period from midnight on one Sunday to midnight on the following Sunday. 10. An employer must therefore pay a weekly contribution in respect of each person employed by him in any week (i.e., commencing Monday) how- ever short the period of service in the week may be, unless a contribution has already been paid for that week. It may happen that though the whole period of service is less than a complete week (e.g., from Saturday in one week to Tuesday in the following week) two contributions may be payable in respect of the worker, because he has been employed for a part of each of two calendar weeks. (ii.) Method of Payment. 11. The contributions are paid by affixing National Health Insurance Stamps to Contribution Cards. 12. National Health Insurance Stamps are on sale at all Post Offices, and are issued in every denomination which an employer can require for the purpose of paying by means of a single stamp the joint weekly contribution due from himself and the worker. Stamps other than National Health In- surance Stamps will not be accepted in payment of contributions. (iii.) Supply and Production of Cards. 13. Every insured person is required to provide himself with a Contribution Card, and his employer can demand its production at any time. It must be delivered to the employer whenever he may reasonably require it for the pur- pose of paying contributions, or for pro- duction to an Inspector or other author- ised person. 14. If the worker fails to produce his card when the employer requires it for K 2 28 4 THE PEOPLE'S INSURANCE the purpose of paying contributions the employer must make use of a special "Emergency Card," a supply of which can be obtained in advance at any Post Office. A worker who without reason- able cause fails to deliver a contribution card when the employer requires it for the purpose of paying contributions, or for production to an inspector, is liable on summary conviction to a fine not exceeding 10. The Emergency Card contains a single stamp space for one weekly con- tribution, and the employer is required to cancel the stamp by writing across it the name of the employed person and the date. The card should then be handed to the worker in order that he may forward it to his Society or In- surance Committee at the due date. 15. An employer must, whenever re- quired by an Inspector or other person authorised to act in the execution of the Act either in person or by notice under his hand, obtain from his employees their contribution cards if the cards are not in his possession, and produce them to the Inspector. 16. Any employer may before July i5th, 1912, apply to the National Health Insurance Commissioners for a supply of ordinary contribution cards for issue to such of his workmen as neglect to obtain cards from their societies or the Post Office. On receipt of an under- taking from the employer that he will write the workman's name and address on the card before issue, a supply of cards will be sent to him by the Com- missioners. An application for a supply of cards should be forwarded in an envelope marked " Cards " in the left hand bottom corner. (iv.) Time for Payment. 17. The ordinary time for affixing the stamps is when wages are paid, and the contribution or contributions for any week or other period must be paid (by stamping the card) at the time when the wages for that period are paid. Thus, if wages are paid weekly the card must be stamped weekly, and if wages are paid fortnightly or monthly the card must be stamped fortnightly or monthly. 1 8. But on certain occasions it is necessary to stamp the card some time in advance of the payment of wages. For instance, when the period of cur- rency of "the card expires, the card must be fully stamped to the date of expiry, although the wages may be paid at a later date. Again, when an employment terminates, the card must at once be stamped to date and handed back to the worker, although he may have to come up later for his wages. And again, the worker has the tight at any time, subject to 24 hours' notice, to demand that his card shall be stamped in payment of all contribu- tions due to date. 19. When the wages are paid for periods of less than a week (e.g., for a day or for so many hours or for a job), the card must be stamped (unless it has already been stamped for the week in which the employment begins) before the wages are paid or at the end of the employment, whichever first happens. The worker must be given his card, duly stamped, before he leaves the employment. 20. Where no wages are payable the employer must affix a stamp on the first day of employment in each week. 21. An employer may, if he chooses, pay contributions in advance by affix- ing to the card a number of stamps corresponding to the number of con- tributions which will become payable during the remainder of the period for which the card is current, or any less number; but he cannot recover their THE PEOPLE'S INSURANCE 285 value if the worker leaves his employ- ment before the contributions fall due. (v.) Special arrangements for Quar- terly Stamping. 22. Where the employer employs not less than 100 regular workmen, and by agreement with the workmen retains the cards during the period of their currency, the Commissioners may, sub- ject to such conditions as they think fit, allow the employer to deposit with them either in one amount or in weekly instalments, such sum as in the opinion of the Commissioners is sufficient to meet the contributions payable by him in respect of the workmen during the period of currency of the cards. At the end of the period in respect of which the deposit is made, the em- ployer will be supplied with stamps to the value of the deposit and will be required to stamp the cards in payment of all contributions payable for the period. High value stamps, repre- senting contributions at yd. and 6d. for 10 and 13 weeks, will be issued for this purpose. Where a deposit is made under arrangement with the Commissioners, the employer will be deemed to have paid the contributions at the due time, but notwithstanding any such arrangement the employer will still be liable to stamp the card of any workman on the termination of the employment and at any time on request by the workman subject to 24 hours' notice. Further information on this subject can be obtained on application to the Insurance Commissioners. (The envelope should be marked "Bulk- stamping " in the left-hand bottom corner. (vi.) Cancelling Stamps. 23. The employer is required, imme- diately after affixing a stamp to a card, to cancel the stamp by writing in ink or stamping with a metallic die with black indelible ink or composition across the face of the stamp the date upon which it is affixed, and in the case of an Emergency Card he must in addition write the name of the worker across the face of the stamp. Aniline inks must not be used when cancellation is effected by means of a metallic die. Rubber stamps are not allowed. Beyond cancelling the stamps in this way the employer must not make any writing or other mark on the card or stamps. PART V. CUSTODY AND RETURN OF THE CARDS. 24. There are two ways of arranging for the custody of the card during its currency. The first is for the employer and worker to agree that the employer shall keep the card, in which case he is responsible for its safety; he must stamp it regularly at the proper times and must return it to the worker (a) Upon the termination of the employment ; (b) Upon the expiration of the period of currency of the card; and (c) Where the worker so requests, within 48 hours after the receipt of the request. The other way is for the wprker to keep the card, and this must be done unless the employer and worker agree that the employer shall keep it. When the worker keeps his card the employer must return it to him as soon as he has stamped it on each occasion of stamping. 25. If the card of a worker who has left his employment is in the posses- sion of his employer the employer should, if he is unable to return the card to the worker, forward it to the Insurance Commissioners. On the death of a worker whose card is then in the hands of his employer the card should be forwarded to the Commis- sioners as soon as possible. 286 THE PEOPLE'S INSURANCE PART VI. RATES OF CONTRIBUTION AND DIVISION BETWEEN EMPLOYER AND WORKER. 26. The amount of the joint weekly contribution due from the employer and the worker is in ordinary cases jd. for a man and 6d. for a woman, 3^. in each case being the employer's part of the contribution. 27. In the case of a worker of the age of 21 or upwards who is not pro- vided with board and lodging, and the rate of whose remuneration exceeds 2s. but does not exceed 25. 6d. a working day, the joint weekly contribution re- mains 7d. for a man and 6d. for a woman, but in the case of men it is divided between employer and worker in different proportions. 28. In the case of a worker of the age of 21 or upwards who is not pro- vided with board and lodging, and the rate of whose remuneration does not exceed 25. a working day, the joint weekly contribution is 6d. for a man and 5 waiters, cabmen). If a worker belonging to this class fails to repay to his employer (i.e., the hotel keeper or cabowner) a contribu- tion paid by him on behalf of the worker, the employer can recover the amount d' the contribution summarily as a civil debt, but proceedings for its recovery must be taken within three months from the date when the contri- bution was payable. (3) The third class consists of per- sons who receive no wages or other money payments either from their employers or from any other persons (e.g., a housekeeper who re- ceives board and lodging only in return for her services). The employer of a person in this class is required to pay the whole contribu- tion and can recover no part of it from the worker. 32. The following example will show the extent of the employer's power of recovery where wages are paid at inter- vals less frequent than weekly, and will also explain further his obligations in the matter of stamping the card. A domestic servant who has been out of employment since the ist October enters on a situation on Saturday, 26th October. She is engaged by the month and paid monthly, so that her first wages are paid on Tuesday, the 26th November. Her contribution card is current for the period from Monday, 1 4th October, to Sunday, i2th January. Owing to her unemployment no stamps have yet been affixed to the card. The employer must, before the payment of wages, affix a stamp for every calendar week during the whole or any part of which the servant has been employed by him, viz. : ist week commencing Monday, 2ist October. 2nd week commencing Monday, 28th October. 3rd week commencing Monday, 4th November. 4th week commencing Monday, nth November. 5th week commencing Monday, i8th November. 6th week commencing Monday, 25th November. The employer must affix ir the proper space on the card a single stamp for each of these six weeks, and he is en- titled to deduct from the wages of the servant the contributions 1ue from her for these six weeks. In the next month, to 26th December, only four contributions are due (viz., for weeks commencing Mondays, 2nd December, gth December, i6th Decem- ber, and 23rd December), and only four contributions can be deducted from the wages paid on the 26th December. 288 THE PEOPLE'S INSURANCE There remain two weeks in the period for which the card is current, viz., the weeks commencing 3oth December and 6th January, and stamps for these weeks must be affixed before the i2th January, although the employer cannot recover from the servant her contributions for these two weeks until the 26th January when wages are next paid. Before payment of wages on the 26th January the employer must affix a stamp in each of the first two spaces of the card then current, but may deduct four contribu- tions from wages (viz., for weeks com- mencing 3Oth December, 6th January, 1 3th January and 2oth January). PART VIII. COLLECTION OF CON- TRIBUTIONS IN CASES WHERE ONLY THE EMPLOYER'S CONTRIBUTION is PAYABLE. 33. Every person to whom a certifi- cate of exemption has been granted is furnished with an exemption book, and every other person in respect of whom only the employer's contribution is pay- able (see paragraph 6) is entitled to ob- tain such a book. The exemption book contains a certificate to the effect that the employed person whose name is entered therein is exempted or excluded from contribution under the Act. This certificate is not valid until the person to whom it is issued has signed his name in the place provided in the book. It expires at the end of the year for which the book is issued. 34. Every person who has applied for and obtained an exemption book must produce it to his employer imme- diately after receiving it, and whenever he enters the service of a new em- ployer. 35. An exemption card is issued for the collection of the employer's con- tributions in these cases, and when a workman produces his exemption book to his employer in accordance with the above requirements the employer must immediately make application at a Post Office for an exemption card for the period then current. On the expiration of the period of the card's currency the employer must obtain a card for the succeeding period if the holder of the exemption book remains in his service. 36. The exemption book must also be produced to the employer at any time on demand, and must be delivered to him whenever he reasonably re- quires it for the purpose of recording payment of contributions. 37. The employer is required to enter his name and address in the place provided in the book against every week for which contributions were pay- able by him in respect of the person named in the certificate, thereby cer- tifying that the employer's contribu- tions for the period of employment have been paid. After the entries have been made, the book should be returned, but where the employed person is in continuous employment it ma} 7 , with his consent, be retained by the employer, who will be responsible for its safe custody. It must be returned to thf employed person : (i) at any time within 4? hours on demand by him, (ii) on the termination of the em- ployment, and (iii) on the expiry of its period of currency. 38. Before any stamps are affixed to an exemption card in payment of contributions the employer is required to enter in the proper place on the card the number of the exemption certificate and the name of the employed person, these particulars being obtained from the Exemption Book. 39. A person who is not required to THE PEOPLE'S INSURANCE 289 be insured by reason of the fact that, not having been previously insured, he becomes employed after attaining the age of 65 (see para. 6 (2) ) is not obliged to apply for and obtain an exemption book, and an employer may therefore have among his workmen a person of this class who cannot produce an exemption book. The exemption card should nevertheless be used for the payment of contributions in respect of him. 40. Every exemption card must be retained by the employer in safe cus- tody during its period of currency, and must not be given to the employed person at any time. On the expiration of the period of the card's currency, the employer must, after writing his name and address in the space pro- vided, forward the card to the Insur- ance Commissioners. 41. The circumstances in which con- tributions are payable and the times at which stamps are to be affixed are determined in exactly the same way as in the case of insured persons (see Part IV.). The employer is not entitled to de- duct from the wages of or otherwise to recover from the employed person any part of the contribution paid. 42. In accordance with Section 4 (4) of the Act and the regulations made thereunder, these contributions may be applied for the benefit of any per- sons in respect of whom contributions have been so paid in the event of such persons subsequently becoming em- ployed contributors. Table showing the different rates of Contributions, payable by Employers only, the Rate varying according to the Amount of the Remuneration earned by the Employed Person. Weekly / Contributions. Wages, &c. Ordinary provisions. Special provisions where employer is liable to pay wages during sickness. Men. ! Women. Men. Women. Where the worker (a) is tinder 21 whatever the rate of re- muneration (i>) z's 21 or tip wards (l) Where the rate of remuneration ex- ceeds 2.9. 6d. a working day, OR where board and lodging are pro- vided whatever the rate of remu- neration d. d. 3 3 3 3 d. d. 2f 2jf 2 t 2 t (2) Where board and lodging are not provided and (i) rate of remuneration exceeds 2s. . but does not exceed 2s. 6d. a working day (ii) rate of renumeration exceeds is. 6d. but does not exceed 2s. a working day ... (iii) rate of remuneration does not ex- ceed is. 6d. a working day 4 3 5 4 6 5 3 2i 4t 3it not applicable t Not applicable if the rate of remuneration is less than ioj. a week. 290 THE PEOPLE'S INSURANCE PART IX. SPECIAL RATES OF CON- TRIBUTIONS WHERE WAGES ARE PAID DURING SICKNESS. 43. The conditions under which this arrangement may be made are as follows : (1) Primarily the arrangement is only applicable to an occupation or a district where it is custom- ary for the employer to pay full wages during sickness, though not necessarily for any fixed period. (2) The Commissioners will make an Order specifying occupations or districts where the custom holds good, and an employer in any such occupation or district may give notice to the Commis- sioners that he wishes to come under this arrangement. (3) The arrangement may by special Order of the Commissioners be extended to other districts or classes of employment if the employers apply for an exten- sion of the arrangement to them, but this can only be done if the workers consent. (4) An employer availing himself of this arrangement and paying the reduced rate of contributions will be liable to pay full re- muneration (which may include board, lodging, or payments in kind in addition to money wages) during periods of illness, as follows : (a) If the worker is engaged for a fixed period of at least six months (such a case would be that of the agricultural labourer who in certain parts of the country is "hired" for a year or for a stated time, e.g., Lammas to Martinmas), then the em- ployer is liable to pay full re- muneration during every period of sickness lasting six weeks or under, and for the first six weeks of any illness lasting over six weeks. In this particular case the em- ployer may be called upon to give full remuneration during sickness for considerably more than six weeks al- together, but as soon as the period of employment ends his liability ceases. (b) In other cases the employer is only liable to pay full re- muneration for six weeks in all in any one year. If a worker is discharged from his employment while suffering from an illness which com- menced during his employ- ment the employer is still liable to pay full remuneration up to the limit of six weeks in the year even though the worker is no longer in his em- ployment. (5) The payment of contributions at the reduced rate under this arrangement as respects any persons employed by an em- ployer in any class of employ- ment is conclusive evidence that he is, with regard to all persons employed by him in that class of employment within the local- ity (if the custom is confined to a locality) in which the custom prevails, under the liability to pay full remuneration during the periods specified in (4) (a) or (4) (b) above, as the case may be. (6) This arrangement cannot be made in respect of workers em- ployed at a rate of remuneration which is less than IQS. a week. THE PEOPLE'S INSURANCE 291 Table showing the Amount of the Joint weekly Contribution and its Division between Employer and Worker in Cases in which these Special Rates are Applicable. Value of Stamp Amount to be affixed by recoverable Wages, &c. Employer. from worker. Men. Women. Men. Women. Where the worker receives wages or other money payments either d. d. d. d. from his employer or from some other person ; and (a) is under ^/-whatever the rate of remuneration f ... 5 4* 3 2. (b) is 21 or upwards (i) Where the rate of remuneration exceeds 2s. 6d. a working day, OR where board and lodging are provided,! whatever the rate of remuneration ... 5 4i 3 2 (2) Where board and lodging are not provided ; and (i) Rate of remuneration exceeds 2s. but does not exceed 2s. 6d. a working day ... 5 4 2 2 (ii) Rate of remuneration exceeds is. 6f members from an approved society to foreign or colonial societies, cl. 32 (P- 9i) n mpires, appointment of, in U.I., cl 89 (p. 148) Pnder-age benefits, 20 lemployment, distress allowance, 29 i. fund, 30, cl. 92 (p. 150) * r main principles underlying Government n scheme of insurance, 59 leasures for diminution of, 59 ^ lethod of payment during, 12 Sssibility of foreseeing, 28 insurance of working against, 4, 6 provisions proposed, 12 Mo icfit, 184 aethod of payment of, 30 ites and periods of, sch. 7 (p. 170) -ance, administration of, 59 .ounts paid by workmen and employers, 29 nd trade unions, 28 ssociations of workmen, 60 Contributions for, sch. 8 (p. 171) stimated number of persons affected by scheme, 60 Q^ .qnc'e of scheme, 31 memorandum with regard to, 57-63 lethod of collection of contributions, Miscellaneous provisions, 60 QJ itline of, 28-31 ,issible extension to other trades, 60 QJ revisions to encourage regular employ- ment, 60, 6 1 Out Ov Pap. Part} Paup classes 57 Unemployment, insurance, right of woi I in insm unemplo)i benefit, cl. 84 (p. 145) scope of the scheme, 29, 31, 57 unsuccessful efforts on the Continent inwards, 28 voluntary, preservation and encourage- ment of, 61 See also Benefits, unemployment Valuation of approved societies, 22-24, 49. 5> cl - 36 (p. 93) Values, reserve, in H.I., cl. 55 (p. 116) Variations in appointment of sickness contri- butions, 38 Voluntary contributions to H.I., 13, 38 age limit for, 13 and married women, 13 estimated numbers of, 14 in arrear, 43 rates and rules for, 69 transfers to compulsory class, 42-44, cl. 6 (P- 7i) unemployment insurance, preservation and encouragement of, 61 contributors under the Act, 260 Wages, deduction from, compulsory, 6, 7 lowness of, prevents working classes from insurance, 5 Waiters, exempt from compulsory H.I., 7 Waiting period, in sickness benefits, duration of, 41 Wales, establishment of Commissioners for, cl. 82 (p. 143) Washerwomen, exempt from compulsory ILL, 37 Wives, employed by husbands, exempt from compulsory H.I., 37 Women under the Act, 203, 251 Women of working-classes, attitude towards insurance, 5 and employments under H.I., 42 sick grant for, 19 Workers, independent, who have been em- ployed, case of, 13 Working classes and insurance at present, 3-6 Working-men under the Act, 250 Workmen's compensation cases, 231 Workmen, rate of contribution, for U.I., 29, cl. 85 (p. 145) associations of, in U.I., 60 provisions with respect to those engaged through Labour Exchanges, cl. 90 (P- 153) refund of contributions paid in respect of those working short time, in U.I., cl. 96 (p. 152) return of part of contributions by, in certain cases, in U.I., cl. 95 (p. 152) RICHARD CLAY AND SONS, LIMITED, BRUNSWICK STREET, S.E., AND BUNGAY, SUFFOLK. UNIVERSITY OF CALIFORNIA LIBRARY BERKELEY Return to desk from which borrowed. This book is DUE on the last date stamped below RtiJ >J L.l. DEC 16 1954 tf APR 4= ? 71955L | A Y30' 6 5-8PM ; JAN21'64-2riM LOAN , , 5 i4Jtt MONTH Af -en Fb: ^ . -C'D LI MAY .19 '64 -12 8Feb-65C8 REC'D LD JAN 2 b '65 -8 AM ER LIBRARY AN 2 5 1968 LD 21-100m-ll,'49(B7146sl6)476 YC 86507 - .