NATIONAL INSURANCE:

A CHEAP, PRACTICAL, AND POPULAR MEANS OF ABOLISHING
POOR RATES.

I HAVE long hesitated before fixing on such a title as I have chosen for the present writing, from a knowledge that its very sound may induce most readers to pass it over as a matter so extravagant, impracticable, and Utopian, as to be unworthy of serious consideration. But it has been well said 'The Utopia of to-day is the terra cognita of to-morrow;' and feeling strongly, as I do, that the scheme I propose offers a solution of one of the most difficult and momentous social problems of our day, which has exercised the ingenuity and excited the grave anxiety of most of our serious thinkers, I venture in all modesty to offer the following argument to an unbiassed public judgment, in the confident hope of at least suggesting some new lines of thought to the many earnest students of the subject, and of leading them to believe in the possibility of a great and greatly needed amelioration in the condition of our lower classes.

I therefore most earnestly entreat their unprejudiced attention for one single hour of their thoughtful leisure to the views I am bold enough to enunciate, premising that if, on the present occasion, I direct my remarks more particularly to the economic, or, in a word, to the ratepayers' aspect of the question, it is not because I cannot fully justify and endorse them on philanthropic grounds (which indeed first suggested them to me), but because of the common-sense consideration that it is rather into the hands of ratepayers than of rate-consumers that my observations are most likely to fall. I propose to consider:

I. The general duty of providing against destitution in sickness and old age.

II. The present gross and general neglect of this duty, with its immediate causes.

JII. The failure of all past and present measures, legislative or philanthropic, to correct this neglect.

IV. National insurance, as a possible remedy.

V. Objections to, and difficulties in the way of, national in

surance.

VI. Advantages to be secured by its introduction.

I. The first section is the shortest. I venture to lay down as a simple axiom that to make a reasonable provision against occasional sickness and the inevitable feebleness and infirmity of old age is the duty of every man gifted with health and strength, and in a position to earn, by his daily labour, a wage from which such provision can be made. I call this an axiom, because to most men its truth is self-evident; and by all men without exception it is admitted.

II. As a matter of fact this universally admitted duty is grossly neglected by our working classes.

We will divide them, for discussion's sake, into two categories— those who do not, and those who do, attempt to fulfil the duty. The former, always paupers in spirit, are content to live from hand to mouth, relying on the fact that, whenever actually destitute, they have a right to parish relief.

Their argument is: Why should we save? The parish must keep us at a pinch. We have a right to be supported by the rates, i.e. by the thrifty.'

And they are right in law, though not in equity. For though the guardians of the poor may see a man to-day burn a fifty-pound note, they cannot refuse to receive him and his family into the workhouse to-morrow, if he apply as a destitute person.

That this improvidence is mean, base, and disgraceful, is true; but far worse is the fact that it is common, and that no legal remedy exists for it at the present time.

The provident working men, on the other hand, do generally, by joining friendly or other provident societies, make efforts at a proper independence; but, from causes which I shall briefly enumerate, even these self-denying efforts only too often bring them, in the end, to no better condition than that of the improvident pauper.

For:

1. Their security for reception of the benefits they contribute for is bad, nine friendly societies out of ten in the kingdom being insolvent, and the average insurer being unable to select the safe

one.

2. Even if able to select a safe one, it may have no branch near enough to his home for him to join.

3. If he succeed in joining such a society, his own removal to a distance may deprive him of his membership.

4. His membership must be a precarious one, depending, as it does, upon periodical payments, which, from various circumstances, he may prove unable to keep up.

5. If once compelled to drop his payments, the necessarily increased rate on rejoining may be beyond his power to pay.

6. The consequence is, that (taking for illustration the experience of a perfectly sound club') the number of withdrawals from benefit societies in each year is at least half that of the entries. And I may add that these withdrawals are only too often final, leaving those who withdraw to be thenceforth classed with the improvident poor.

7. The rates of payment which can really assure the benefits generally offered by friendly societies are far higher than any ordinary labourer in middle life can find it possible to pay. This condition of things might be thought sufficient to paralyse all exertion in the direction of providence; and it speaks well for the native independence of our people, that, despite such heavy discouragements, so many thousands should be still making their monthly effort, uncertain, ill-secured, speculative, and in truth nearly hopeless as it is, in order to avoid becoming chargeable to the poor rates.

III. Neither legal nor philanthropic measures exist at the present time able to remedy this general neglect.

This may seem a very sweeping assertion to make in the face of successive Commissions on Friendly Societies, and of the recently passed Friendly Societies Act, as well as in the face of the fact that an immense amount of philanthropic effort is and has been directed towards improving the condition of friendly societies and rendering secure the provision which they undertake to make for their members. But, I reply, they do not touch the real evil which exists. They all tend to make the provident man more secure, but they do not even profess to touch the improvidence of the thriftless at all. The new Act may enable a provident man to choose a solvent club, but will not necessarily induce an improvident man to spend a penny in assurance. To use a very homely illustration, it may, in time, provide the very purest water, but makes no effort to lead the asses to it, far less to make them drink.

Furthermore, if the operation of the Act succeeded in making every friendly society a solvent one, the misfortune would still remain, that nearly half the present providence would be wasted altogether, as we have seen by the fact that for every hundred entries into a perfectly solvent club there are nearly fifty withdrawals occasioned by non-payment of contributions!

So that, if every friendly society in England were solvent, and if half the working classes (a very liberal calculation) became at one

'I take as typical the Hampshire Friendly Society, now in its fifty-first year of activity. It has been actuarially valued every five years, and has always had a surplus of assets over liabilities. In its experience during the ten years 1866-75 inclusive, the aggregate entries have been 7,709, and the aggregate withdrawals 4,055, nearly all of these latter having been from non-payment of contributions,

time or another members of a friendly society, the utmost result would be, in round numbers, that about 25 per cent. might be classed as provident, and 75 per cent. as depending on charity in every time of need.

From law we turn to philanthropy, to consider its latest suggestion for amending the present deplorable state of things.

...

It is that put forward by the Bedfordshire Committee, a suggestion well intended, no doubt, and which has met with great approval from the Times newspaper, which, in a leading article of the 24th of August 1877, goes so far as to say that the remedy which the Bedfordshire Committee have suggested is complete and simple. It consists, in the main, of transferring the functions of the old village friendly societies to other and more trustworthy agencies. Some of the great societies-the Manchester Unity Order of Odd Fellows, or the Ancient Order of Foresters, for example, whose management is in the hands of their subscribing members-are to be induced to establish branches within reach of the Bedfordshire villagers,' &c.

I admit at once that this suggestion, if carried out, might in some respects prove convenient to the already provident class, and to them only; but it is very far indeed from providing a complete and simple' remedy for the crying evil of the times, for even if demonstrably solvent, not a quarter of the population would contribute to existing societies."

IV. It being thus evident that, if every friendly society in England were perfectly solvent, and if all that the law contemplated and all that philanthropy suggested had been completely realised, there would still remain 75 per cent. of the labouring classes entirely dependent, in emergencies, upon the poor rate, and therefore to be classed as improvident paupers, I would ask any of my readers to put himself in the position of a provident wage-earner, and consider this question: Is it a fair thing that for every month of my life I should be exercising a hard self-denial, while three out of four of my class scoff at the notion of taking such trouble as I do, and boast that, however they choose to squander their means, they will, in the end, be as well off as myself, and that partly through my exertions?' And only one answer can be given: This is manifestly unjust.' Next let him put himself in the place of the struggling industrious ratepayer, and say, 'Is it fair that tens of thousands of sturdy young labourers should be able to spend, as they do, from five to ten shillings weekly in the only way they know how, namely, in drink, with the certainty that I must one day be taxed to support them when in want?' 3 Again there is but a single answer: This is a monstrous

injustice.'

6

2 Since this was written, the Bedfordshire Committee have found it necessary to abandon their intention from unwillingness of labourers to join.

• Poor relief is in fact contributed by ratepayers, a large proportion of whom

Surely, then, there should be a power, if there be a means, of at least compelling every man to bear his own share in the burden of natural providence, instead of allowing him to cast it on the shoulders of others. When instances can be given, as I can give from my own personal knowledge, of young labourers by the dozen without a change of decent clothes, continually and brutally drinking, and living almost like savages, while earning fully a pound a week-or, as I can also give, of a carter-boy, aged fourteen years, spending three shillings a week regularly on tobacco-it is quite time that poor, decent provident people should demur to being taxed for the infallible necessities of such a generation, and that the public ear should at least be open wide to hear any suggestions which may tend to the redress of so gross an injustice, and the blotting out of such a national disgrace.

For it is a plain failure of good government that an enormous class of the people should be allowed to ignore the first duty of every loyal citizen, and it is a political crime of the gravest sort that they should be, as they are, encouraged in the notion that the grosser their waste, their sensuality, their ignorance, and their selfishness, the stronger claim they establish to support and aid from their fellow-men. I am certain to carry every ratepayer in England with me when I say that our present system is, in its working, most unreasonable and unjust, and that something should be done to make the wasteful bear at least a part of the burden so unfairly laid upon the shoulders of the thrifty.

I do not see for an instant why we should mince this matter. If the labouring classes can make their own provision, and will do so, let them be shown how; if they can, and will not, let them be compelled.

Compulsion, in this connection, is a strong word, which may well startle a reader; but I beg him, of his patience, not to pronounce it a wrong word till he has read the remainder of my essay.

And lest he should impatiently throw it aside, I will address myself first to removing the grand prejudice (for it is nothing else) which makes the notion of compulsion savour of what some folk sneer at under the name of parentalism,' and others rave against under the name of tyranny.

There is an ignorant but very prevalent idea that because some nations transact by government a number of matters which England leaves to the management of individuals, the Government of England not only allows, but on principle ought to allow, every man to do whatsoever is pleasing in his own eyes in matters which at all concern his personal interests; and that any government interference have perhaps worked harder, have been more temperate, frugal, and self-denying, and yet are hardly less poor, than the very paupers whom they have to support. — Report of Poor Law Conference.