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OLD AGE PENSIONS.

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OLD AGE PENSIONS. Mr Lloyd George's Speech CONTRIBUTORY SCHEME REJECTED. Sliding Scale Basis. GOVERNMENT OPEN TO CONVICTION. INFIRMITY AND AGE LIMIT. In the House of Commons on Monday, Mr LLOYD GEORGE, in moving the second reading of the Old Age Pensions Bill, said the scheme which the Government put forward was necessarily incomplete. They had never professed that it was complete, or that it dealt with the whole problem. It was purely a first step. It was necessarily an experiment, and it must be considered by the House as such. He also wished to point out that those who criticised most severely the dis- qualifications which the Government had in- troduced were in the main those who were op- posed to the principle of the payment of old age pensions by the State. Therefore, he ad- vised his hon. friends to look very cautiously at those criticisms. (Hear, hear.) The first general criticism which had been made against the Bill was that it was a non-contri- butory one. He was not sure that that was not the meaning of the amendments of Mr Harold Cox and Lord R. Cecil—those two anarchist leaders. (Laughter and cheers.) He (the Chancellor of the Exchequer) de- murred altogether to the division of schemes between contributory and non-contributory. While commodities were taxed, there could be no such thing as a non contributory scheme, because the State exacted a contribution from every man in the land in one way or another. Therefore, when a scheme was financed out of public funds it was just as much a contribu- tory scheme as any scheme arranged on the German or any other basis. Again, a work- man who by his labour had added to the nation's wealth had already made his con- tribution. It was also a rather remarkable thing that most social reformers who had taken up the question of old age pensions had, on mature consideration, abandoned all con- tributory schemes on the ground that they were unequal in their treatment of the work- ing classes, cumbersome and expensive, and in a country like ours hopelessly impracticable. He reminded the House that Mr Chamberlain was at first in favour of a Contributory Scheme, but ultimately abandoned all idea of it, and Mr Chamberlain's Committee after full inquiry was unable to recommend any contributory scheme. Practically all parties and groups in the House with one or two exceptions had given up the contributory idea, but there had been a revival of it. The more he considered it the more clearly it was seen that there were insuperable difficulties in the way. A con- tributory scheme would practically exclude the women of the. country from its benefits. The majority of working men were unable to deflect from their weekly earnings a sufficient sum of money to make an adequate provision for old age in addition to the provision they were now mak- ing for sickness, infirmity, and unemployment. The fact that so many of the working class had provided against sickness and unemploy- ment was in itself proof that they would have provided for old age if it were possible to do so with State assistance. (Hear, hear.) With reference to the suggestion that the Govern- ment scheme would Be far more equitable if they had a sliding scale in place of a fixed income limit, he said the Government had an open mind on that point, and were prepared to consider suggestions provided that they did not substantially increase the charge upon the Exchequer. Other objections to the scheme, if embodied in amendments, would have the effect of increasing the expenditure, and he wished to warn the House that the. figures given were elastic. (Ironical Opposition cheers.) Although at first the scheme might not cost more than six millions, he believed he was not overstating it when he said that in the result the Trreasury commitment would probably amount to Seven-and-a-Half Millions Sterling. At first! people might be shy of claiming their pensions, but the feeling was not likely to last long. The pauper disqualification was a vanishing one, and its full effect would only be felt in the first year. Again, the right to a pension was likely to induce aged people who were earning more than 10s to consider that the time had come when they should rest from their labours. Therefore, he asked the House to realise what was likely to be th £ 'cost of the Bill without its being altered in any particu- lar. He also claimed that this scheme of the Government was much the most liberal scheme which had ever been suggested by any responsible authority in that House. The Colonies, having no great naval and military expenditure, could afford to be more liberal, but this scheme of the Government exceeded in liberality that of Any such country as Ger- many-, Belgium* Denmark, and France. With reierence to the question of age limit and the proposal. to reduce it from 70 to 65, he pointed out that it would be only possible to do that by placing half the cost of the scheme upon the local rates, and he did not anticipate that anyone would make such a proposal as that. Moreover, he was of opinion that the old-age pension ought to begin at 70, and that pen- sions granted to persons who had not reached that age should be based upon the principle of infirmity rather than age. With reference to the reduced pension to be given in the Case of Couples living together, he said the proposal of the Government was based upon the question of household economy. He protested against the language which had been used in regard to this part of the scheme. A stranger would imagine that the Government engaged in a nefarious attempt by crafty, harsh, and even immoral means to rob thousands of old people of an honourable provision made for them by Tory Administrations in the past—(Ministerial laughter and cheers)—whereas the fact was of course that they were for the first time making provision for nearly 600,000 aged persons who otherwise had nothing before them but pauperism. (Hear, hear.) He asked members to remember-that the Government scheme was merely a beginning, and it was essential to its future development that the foundations should beiaidrwith care. There had been a great deal of misapprehension with regard to the industry test. It was a test to exclude the loafer and the wastrel. The Government were perfectly willing to consider verbal amend- ments of the clause if it was considered that the net was too wide, but they considered it was of the greatest importance that loafers and wastrels should not be treated in the same way as men who had" given the best of their lives to the service of the State.. (Hear, hear.} He recognised the possible danger that this Character Test might be used for the purpose of excluding persons of good character, who for some reason had rendered themselves obnoxious to the authorities. To remove that fear he would propose an amendment, which would exclude from the operation of the subsection all persons who had been for a certain number of years before they reached the age of 60 members of Benefit or Friendly Societies, Trade Unions and societies of that kind, the membership of which showed that a man must have been in more or less regular work. As to the pauper disqualification, as he had said that was a vanishing disqualification but before the pauper question was fully dealt with they must wait for the report of the Royal Com- mission on the poor law, and must consider the relations between local and Imperial finance. The Government had to look to the means at their disposal. They had come to the con- clusion that in the course of next year at any rate they could not see their way to propose anything which would cost more than the figure he had indicated. The effect of propos- ing amendments to extend the scheme by eliminating the disqualifications would be to destroy the scheme. The disqualifications on the face of them might appear harsh and unjust at the moment, but he asked the House to rememberjthat the scheme was purely an experi- ment made in an old country for the first time. It was a beginning, but the Government claimed that it was a real beginning. (Hear, hear.) The Government recognised that the problems of the sick and the infirm and of men who could not find the means of earnings livelihood must be dealt with by the State, and in asking the House to give a second read- ing to this Bill he desired hon. members to take the Bill as an evidence of their wish to utilise the resources of the State to make pro- vision for undeserved poverty and destitution in all its branches. (Ministerial cheers.) Tory Complaints. Mr CHAPLIN, pointing out that the Chan- cellor of the Exchequer had announced only one concession, namely, his willingness to con. sider a sliding scale, said he was bound to say that so far as he was concerned he did not think the Government Bill improved upon acquaintance. Emphasis had been laid upon the point that the Government scheme was simply a beginning and an experiment. It was evi- dently in contemplation to remove some of the disqualifications, and he thought it would have been more to the point if the Chancellor of the Exchequer had given to the House some idea of what the ultimate expense would be when the scheme had passed beyond the experimental stage. Radical-Tory Amendment. Mr HAROLD COX (L. Preston) moved as an amendment— That while it is desirable that the State should organise aid for the unfortunate by establishing and assisting a general system of insurance against the principal risks of life, it is unjust to spend the taxpayers' money in giving subsidies to persons selected by arbitrary standards of age, income, and character. He was not opposed, he said, to the principle of old age pensions, but he was opposed to the Government's scheme, because it was un- just in principle, therefore necessarily unjust in almost every one of, its details. From minute to minute the Bill was changing its most essential features, and he was beginning to understand why the Government were so anxious to pass a closure resolution. In his Budget speech the Prime Minister had declared himself agafnst a sliding scale in the matter of incomes. Now the Chancellor of the Ex- che*HtfT anzumncad &b.t. toe ftcnesunjent were prepared to accept a sliding scale. under which the biggest liar would get the biggest pension. (Laughter, and Opposition cheers.) The scheme of the Government would relieve not the man who was said to claim the pension, but the wealthy employer who was paying nothing. As to the character or industry test, no doubt pressure would be brought upon the Government to abolish it. (Labour cheers.) But were Labour members prepared to give a pension for honourable service to all the drunkards, pimps, and blackguards in the land ? Under a non-contributory scheme you must either give an honourable pension to old blackguards, or you must have a painful in- vestigation into the character of honest people. It was only by having a contributory schemc that you could escape from that dilemma. (Opposition cheers.) If Labour members con- tended that these pensions were claimable as of right for honourable service to the State, then they were bound to accept the contribu- tion test, which would provide that there had been such honourable service. The true ideal to set before the country was not to subsidise poverty and industry by schemes such as this, but to raise wages, and he held that this scheme of non-contributory pensions was opposed to the essential principle of Free Trade. (Opposition cheers.) Lord ROBERT CECIL (C., Marylebone), seconding the amendment, alluded to the fact that the Chancellor of the Exchequer had described him as an anarchist. He preferred to describe his form of political belief as a reasonable trust in personal freedom and reasonable trust in personal freedom and personal liberty. He imagined it was not only in this country that a bureaucrat thought he who differed from him was an anarchist. (Laughter.) He presumed the Chancellor of the Exchequer was really making a confusion between anarchism and individualism. He thought that in the main question of prin- ciple it was fair to say that those who differed from the Government plan differed because they were of a more individualistic tendency than was shown in the proposals of the Government. The proposal of the Govern- ment was to make an enormous gift of money to a very large section of the working classes, who were possessed of very large electoral power. He did not wish to be an alarmist, but he felt that with the vast responsibilities of this country we had in the last resort to look only to the national character to defend us. They had no right to assume that in the next 25 years we should have such a simple and peaceful course to steer as we had during the past generation. (Hear, hear.) No one who looked at the existing situation could fail to see that there were certain elements of dim- culty and danger in the future, and if we had to enter upon a great life and death struggle as might well be the case in the next few years, and we had weakened the fibre of our people by a system and a policy of which the Govern- ment scheme was to be the beginning, then the House of Commons which sanctioned that miserable backsliding from the true statesman- ship of Empire would have much to answer for. (Opposition cheers.) Flavour of Socialism, Mr P. GRADY (Lab., Leeds) admitted that the principle upon which the Bill was based largely partook of Socialism, although some of its clauses bore the impress of the minds of individualistic members of the Cabinet. The claim set up by the Labour party was that the old age pension should be given as a social right, and that there should be only one bar- that of criminality". Sir WALTER FOSTER (L., Derby) thought that the Government had acted wisely in taking the line they had. He accepted the Bill with gratitude. BLACK (L., Beds) was delighted with the Bill. In his opinion it was simply splendid to have made such a beginning. Agricultural labourers with whom he had dis- cussed the measure regarded it as a great boon. Mr MADDISON (Lab., Burnley) protested against any suggestion that such a preference should be given to incomes derived from Friendly Societies or Trade Unions. He accepted this scheme of the Government whole-heartedly as a beginning and as an ex- periment, because he realised that they must take this scheme within the four corners of the financial resources which they were told existed. Poor Law Reform. Mr HALDANE (Secretary for War) said the scheme of the Government did not profess to cover the whole field it was part of a very much larger reform of the poor laws which the Government were contemplating when they had the report of the Royal Commission. That revision would undoubtedly comprise a better system of classification of the persons who need State assistance, and one of the classes marked out for help was composed of persons who had worked hard, but had been unable to make provision for their old age —the class in fact which would be provided for under this Bill. He anticipated that by the reform of the poor law a considerable saving of public money would be effected by the pre- vention of overlapping. The Govern ment Bill was not complete in itself, It was not intended to be complete. It was the first step in a journey which might require more Parliaments than one to com- plete, but they felt it was their duty to enter upon it at the earliest possible moment in an attempt to solve a great and pressing problem. Mr WALTER LONG (C., Dublin) thought the Secretary for War had put the Bill upon a totally different footing to that on which it had been placed by the Prime Minister or the Chancellor of the Exchequer. He had dis- covered that the principle of this measure was rooted in the old poor law. The debate was adjourned. In the House of Commons on Tuesday, The debate was resumed on the order for the second reading of the Old Age Pensions Bill, and Mr Harold Cox's amendment declaring that while it is desirable that the State should organise aid for the unfortunate by establishing and assisting a general system of insurance against the principal risks of life, it is unjust to spend the taxpayers' money in giving subsidies to persons selected by arbitrary standards of age, income, and character." Mr LONG (C., Dublin) expressed regret that the Prime Minister intended to restrict the discussion of this Bill by a system of the closure, having regard to the fact that the measure was the most important from the point of view of social" reform that had been introduced to the House of Commons since 1834. Mr Haldane on the previous night had presented the Bill in a light which ex- hibited the persons who were to receive pen- sions under this scheme as a new class of paupers, and he confessed on that point he should like to hear the view of the President of the Local Government Board, whose absence through ill-health he regretted. (Hear, hear.) In setting up a new kind of local authority the Bill was bound to produce overlapping, and unless it was followed in the next Session by a Bill to amend the Poor-law its effect upon the existing Poor-law adminis- tration would be of the gravest possible kind. In his view, the most satisfactory scheme of old-age pensions would be one which combined the contributory principle with the plan of the Government, under which individuals who could afford to do so might contribute something to the pension fund, while provision would be made for the very poor and the sick and infirm. At the same time he could not vote for an amendment which would have the effect, if carried, of destroying the Bill and preventing that fur- ther debate upon its proposals which he still hoped would result in some modification of the Government's proposals. Mr THOMAS BURT (Lab., Morpeth) said a fatal defect in any contributory scheme was that it could not immediately come into operation, and it would exclude thousands of the most necessitous and the not least deserv. ing. (Hear, hear.) There were many thou- sands of working men who were in receipt of wages of less than 20s a week. How could they contribute ? "I know one man in this House," he said, who has made an attempt to live and bring up a family on little more than 20s a week, and he found it no easy task. I can speak with absolute confidence on that subject' (Hear, hear.) Although he was not entirely satisfied with the Bill, he would sup port the Government through thick and thin in their effort to carry it. (Hear, hear.) He thought it was an honest, straightforward, and substantial step in the right direction, and it would do much to benefit and encour- age the veterans of industry. (Cheers.) Mr GOULDING (C., Worcester) thought that the House and the country were to be congratulated upon the fact that at last a Government had been found with courage to undertake the. responsibility of producing an Old Age Pensions Bill, While he could not agree with all the details of the Bill, he would certainly with joy support the Government should the amendment go to a division. MrFLYNN (Nat.) said the Bill was generally approved of in Ireland. Mr HODGE (Lab., Lancashire) referred to certain utterances of Mr John Burns in days gone by with reference to the question of old age pensions, and said it would be interesting to know what was the opinion of the right hon. gentleman in regard to this wholly in- adequate scheme proposed by theGovernment. He (the speaker) wanted a universal scheme, and when he was asked where the cloth was to come from he replied that there was plenty of cloth to be had if the Government only had the courage t get it. (Labour cheers.) For instance, the land tax of 4s in the £ was still assessed on the value of land in 1698. If it was levied < n the present value, according to the best authorities it would bring in 40 millions, which would get the Chancellor of the Ex- chequer out of his difficulties. (Labour cheers and Opposition laughter.) Mr HORRIDGE (Lu, Manchester) felt that they owed a debt of gratitude to the Govern. ment for having called them to justify them- selves before their constituents for the pledges they had given. IiI his opinion the Government had taken the grandest step in social legisla- tion which had ever been taken by any Government. A Lordly Attack. Earl PERCY (C., Kensington) supported the amendment. He was not prepared to say that a contributory scheme was the only pos- sible scheme, but a contributory scheme had this great and overwhelming advantage that it would commit the country to no financial liability the extent of which they could not foresee. That was not the case with the Government's scheme- They at in the House as trustees for the taxpayers of the country, and to commit the country to an expenditure of seven and a half millions, only one and a half millions of which was provided far in tk present yeøz, was nothing short of a breach of trust. The speaker asked what the Government were going to provide for next year's naval expen- diture. That consideration of naval expen- diture had much more force when it was re- membered that the House was quite ignorant of the actual expenditure which they were now being committed to. Already the estimate had jumped from 6 to 7t millions. The PRIME MINISTER 1 have already explained that 6 millions was my estimate of the cost of the scheme during the next financial year, and the 71 millions is the esti- mate of the Chancellor of the Exchequer of the ultimate cost. Earl PERCY, continuing, declared that the Government were really merely proposing by this Bill another form of outdoor relief, and he wanted to know what the effect of the new system was going to be upon the existing system of outdoor relief. There was no plea of urgency in the matter of old age pensions —(cries of Oh ")-and there was no reason why the Government should not wait six months until they had received the report of the Poor Law Commission. (Hear, hear.) Mr Balfour's Criticism. A succession of speakers having praised the Government. Mr BALFOUR (C., City of London) asked had they been given sufficient material on which to judge of the merits of the Bill ? Even members of the Government talked of it in tones which did not add to the confidence of the House in the proposals put before it. The Chancellor of the Exchequer himself spoke as a somewhat embarrassed stepmother —(laughter)—of the merits of the offspring to which he stood in loco parentis. and his speech was occupied not in defending the Bill but in explaining the concessions he meant to give to meet the objections raised to it. Neither on the finance of the Bill nor on the social question involved had the Govern- ment been able to supply the informa- tion which was absolutely necessary. The Chancellor had admitted that the scheme was arbitrary in the sense that it was wholly illogical, and that there were many just and natural claims that would appeal to every humane mind, but he pointed out that he had only got a certain amount of money to give. That was quite true. If the benefits that they could speculatively distribute among the population of this country could be supplied out of some illimitable fortunatus purse, the task of social reformers would be compara- tively easy, and the task of the Chancellor of the Exchequer would not deserve the well- earned remuneration of £ 5,000 a year. (Hear, hear.) Unhappily, that was not the case, and nobody knew it better than each successive occupant of that post. The Government were going to spend six millions next year, seven and a half millions the year after, and, in the absence- of some hypothetical reform of the poor law, they were going to spend eleven or twelve ♦millions in a very brief period-(Opposition cheers)—and yet they had not received from the Government the smallest hint or suggestion of the methods by which these immense sums were to be paid. Even supposing this money was at the disposal of a wealthy and happy Chancel- lor of the Exchequer, were the Government sure that this was the best method of using it for the benefit of the wage-earning classes of the community ? (Opposition cheers.) The late Government had been reproached for having omitted to deal with this question. (Ministerial and Labour cheers.) No member of the party c to which he belonged need ever be ashamed of discussing in that House the .comparative per- formances of various Governments--( Opposi- tion cheers and Minisieriallaughter)-in respect of legislation designed to benefit the wage-earn- ing classes of this country. (Opposition cheers.) What he complained of was that this was an attempt to deal with a very small fraction of a very big subject in a very incomplete and fragmentary fashion. It was perfectly true that they all wished to keep the pension sys- tem apart from the ordinary system of the Poor Law, but it was perfectly impossible to consider it apart from the Poor Law. How could they deal with the question of the deserv- ing poor unless they knew what the Poor Law was ? It was folly to try. They were using all the money which the House was told was to be squeezed out of the taxpayers by means at present unknown entirely lor the benefit not of all people over 70, but for the people over 70 who could live in their own homes to the exclusion of everybody over 70 who ought to be in an infirmary who for some cause not con- nected with their own fault were unable to earn a living. That was so one-sided and so arbitrary a method of dealing with the matter thathe thoughtit required some recdnsideration. They did not propose to abolish the Poor Law system altogether, and therefore they were going to keep it for everybody under 70 and tor the undeserving. If they kept the system they must distinguish, and if they distin- guished they would inevitably bring in all the evils which Labour members had forcibly called attention to. Premier's Slashing Reply. Mr ASQUITH, who was received with loud Ministerial cheers, confessed that Mr Balfour's speech had left him in doubt as to the manner in which the right hon. gentleman intended to vote. How was it that during the 10 years 1895-1906, when he and his party exercised un- disputed authority in both Houses of Parlia- ment—(loud Ministerial cheers)-and he (Mr Asquith) well remembered put old age pen- sions in his election addresses in 1905—(loud Ministerial cheers) — not one step was taken to fulfil this pledge ? The right hon. gentleman said it wes due to the South African war, but that war did not break out until the end of 1899, and during the years they were in office they possessed large surpluses, inherited from the previous Liberal Government—(loud Ministerial cheers)-and a great and growing revenue from the death duties. (Renewed Minis- terial cheers.) The present Government had not attacked the old age pension question earlier because they had been engaged in pay- ing off the debts of their predecessors—(Minis- terial cheers)—and placing the finances and credit of the country in such a condition that if it pursued a system of Free Trade finance he had no doubt the resources of the country would be equal to the test. (Ministerial cheers.) There was no difference between the two sides of the House in regard to giving old age pensions, and all he had to deal with was the controversy between the universal and partial systems and between the contributory and non-contributory systems. Financial exigencies put a universal system out of the question. They had ruled out a contributory system because they were anxious to improve the lot of the aged poor. He quite agreed that that was simply a fragment of a larger question, but they could only deal with that larger L questionstep by step. There were other aspects, and the Government had never said that with regard to some of them it might not be desir- able to combine voluntary effort with State assistance, but all the voluntary schemes which had been suggested were, in their opinion, inadequate and futile, No volun- tary scheme which had yet been suggested would bring in many of those whose needs and merits were greatest. With all respect to the hon. member for Preston, who was one of their most valuable members-(cheers)-who always said with courage those things which some of them had thought but had ceased to think- (laughter)—and which others thought but were reluctant to say—(laughter)—they felt bound to reject contributory schemes. He trusted that his hon. friend might long retain the confidence of the electors of Preston, and if any of those mishaps which befel the best of them—(laughter)—should occur to him it would be almost a necessity to provide some means for his special existence. (Laughter.) His hon. friend knew a great deal about a great many things, but there was one subject on which his knowledge was in need of im- provement, and that was the character, dis- position, hopes, and motives of the average British citizen. (Loud laughter.) As to the actual criticisms of the scheme, what did they amount to ? They all related to the dis- qualification of persons otherwise entitled to a pension. The expulsion of those in receipt of Poor Law relief would undoubtedly give rise to cases of exceptional and anomalous hardship but this was not a permanent but a provi- sional disqualiifcation, and without it Boards of Guardians would have been tempted to get rid of their obligations and add to the applicants some two to three hundred thou- sand persons, with an additional cost of not less than three millions sterling. As to the so- called character test, the Government would be no party to any roving introspective examination of the character and morat ante- cedents of applicants. He admitted that some of the words in the definition were open to criticism, and would no doubt at the sugges- tion of the Government itself be altered in Committee-(Ministerial cheers)-the only ob- ject being to exclude wastrels and loafers. It is true (said the right hon. gentleman in conclu- sion) there are difficulties in our way. You cannot settle this question or any other by a wave of a wand. But because of the difficulty and the complexity of the task are we to sit still with dumb lips and folded arms, with bewildered brains and palsied energies while this great procession of the poor, the necessi- tous and the unfriended linger but the last years of strenuous lives given to the ser- vice of the industry of this country ? We say no, and we ask the House to take the first step towards this beneficent object. (Loud Ministerial cheers.) THE DIVISION. The House divided, and there voted- For Mr Cox's amendment. 29 Against. 417 Majority against 388 I The Bill was thereupon read a second time without further challenge, and committed to Committee of the whole House.

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