(c) crown copyright
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THIS DOCUMENT IS THE PROPERTY OF H I S BRITANNIC M A J E S T Y ^ GOYERNMENT Printed
for the War Cabinet.
February
1943.
SECRET.
Copy N o ,
W . P . (43) 58.
February
11, 1943.
TO
BE
KEPT
UNDER
LOCK
AND
KEY
I t is r e q u e s t e d t h a t special c a r e m a y be t a k e n t o
e n s u r e t h e secrecy of t h i s d o c u m e n t
WAR
CABINET.
The Beveridge P l a n .
INTERIM
REPORT
OF
THE COMMITTEE
PRIORITIES.
ON
RECONSTRUCTION
INTRODUCTORY.
A T t h e i r m e e t i n g on t h e 14th J a n u a r y , 1943 ( W . M . (43) 8 t h Conclusions,
M i n u t e 3), t h e W a r C a b i n e t decided t h a t c o n s i d e r a t i o n of t h e B e v e r i d g e P l a n ,
together w i t h the g e n e r a l review of o t h e r s u b s t a n t i a l c l a i m s to financial
assistance set o u t in the Chancellor of the E x c h e q u e r ' s P a p e r ( R . P . (43) 5), should
be r e m i t t e d to a C o m m i t t e e to be c o n s t i t u t e d as follows :—
L o r d P r e s i d e n t of t h e Council
[Chairman);
M i n i s t e r of L a b o u r a n d N a t i o n a l S e r v i c e ; M i n i s t e r of P r o d u c t i o n ; H o m e S e c r e t a r y a n d M i n i s t e r of H o m e S e c u r i t y ; Chancellor of t h e E x c h e q u e r ; Lord Privy Seal; Minister without Portfolio; a n d to sit w i t h o t h e r M i n i s t e r s concerned.
2. T h e G o v e r n m e n t ' s decisions on the p r o p o s a l s in t h e B e v e r i d g e R e p o r t
m u s t clearly be t a k e n in t h e l i g h t of a full a p p r e c i a t i o n of t h e financial i m p l i c a ­
tions. W e t h e r e f o r e d e a l first w i t h t h e g e n e r a l financial p o s i t i o n .
3. W e h a v e s t u d i e d t w o M e m o r a n d a by the C h a n c e l l o r of t h e E x c h e q u e r ,
s u r v e y i n g t h e p o s t - w a r B u d g e t a r y p o s i t i o n ( R . P . (43) 5 a n d P . R . (43) 8), t o g e t h e r
w i t h a M e m o r a n d u m by t h e H o m e S e c r e t a r y on t h e same subject ( P . R . (43) 2).
T h e C h a n c e l l o r ' s survey shows t h a t , looking f o r w a r d to the t i m e w h e n e x p e n d i t u r e
on t h e w a r a n d i t s i m m e d i a t e a f t e r m a t h h a s come to a n end (say, i n t h e t h i r d y e a r
after h o s t i l i t i e s have ceased), we can see no p r o s p e c t t h a t t h e excess of r e v e n u e
(on b r o a d l y t h e p r e s e n t level of t a x a t i o n ) over e x p e n d i t u r e w i l l suffice to m e e t all
the m a n y claims e n v i s a g e d , for new d e v e l o p m e n t on t h e one h a n d a n d for r e m i s s i o n
of t a x a t i o n on t h e other. Some o r d e r of p r i o r i t i e s m u s t t h e r e f o r e be e s t a b l i s h e d
before n e w c o m m i t m e n t s a r e e n t e r e d i n t o . A t t h e present' t i m e t h e e x t e n t of
m a n y of t h e n e w claims likely to be m a d e on the E x c h e q u e r a f t e r t h e w a r is still
u n c e r t a i n , since in some s p h e r e s p o s t - w a r p l a n s have--not been fully formulated,,
w h i l s t in o t h e r s the p o s i t i o n w i l l r e m a i n u n c e r t a i n u n t i l a f t e r t h e w a r . A t t h i s
stage, therefore, we c a n say no more as r e g a r d s t h e new c l a i m s t h a n t h a t w e a r e
satisfied t h a t the e x p e n d i t u r e necessary to e n s u r e i n t e r n a t i o n a l s e c u r i t y m u s t
have t h e first place, a n d t h a t , second only to t h i s , we w o u l d p u t t h e e x p e n d i t u r e
necessary to e s t a b l i s h t r a d e a n d i n d u s t r y in t h i s c o u n t r y on a h e a l t h y f o o t i n g , t o
m a i n t a i n e m p l o y m e n t a t t h e h i g h e s t a t t a i n a b l e level a n d to foster o u r e x p o r t
trade.
[25024]
4. A s r e g a r d s t h e other claims on the E x c h e q u e r for
additional
e x p e n d i t u r e — f o r example, A g r i c u l t u r e , E d u c a t i o n , Colonial Development a n d the
Social Services, to n a m e only a f e w — i t is impossible a t t h i s s t a g e to establish
a n y o r d e r of p r i o r i t y or to e n t e r into definite commitments. I t follows t h a t , while
it is t h e d u t y of the G o v e r n m e n t to reach provisional decisions a s to post-war
p l a n s in all these spheres, these p l a n s m u s t all be b r o u g h t u n d e r review a n d related
to the financial s i t u a t i o n when the time is reached for them to be p u t into
legislative effect.
5. T h i s does not mean t h a t in next w e e k ' s Debate the Government
S p o k e s m a n should r e f r a i n from e x p r e s s i n g views on the p r o p o s a l s in the
B e v e r i d g e P l a n . T h e o r i g i n a l i n t e n t i o n h a d been t h a t , in t h i s i n i t i a l Debate,
M e m b e r s of all P a r t i e s should have, an o p p o r t u n i t y of e x p r e s s i n g t h e i r views on
the P l a n before any conclusions were reached by the Government.
B u t some
considerable time h a s elapsed since the p u b l i c a t i o n of the R e p o r t , which has
a r o u s e d a keen p u b l i c interest.
W e t h i n k i t would be difficult n o w for the
G o v e r n m e n t Spokesman to say no more t h a n t h a t the G o v e r n m e n t still have the
R e p o r t u n d e r consideration a n d will take i n t o account the.views expressed.
6. W e recommend t h a t the G o v e r n m e n t S p o k e s m a n should m a k e the
proviso t h a t no firm c o m m i t m e n t s can be e n t e r e d into a t the p r e s e n t time.
Subject to this, however, he should i n d i c a t e the G o v e r n m e n t s g e n e r a l views a n d
preferences as r e g a r d s the R e p o r t as o u t l i n e d in l a t e r p a r a g r a p h s .
T h u s , it
should be stated t h a t t h e G o v e r n m e n t accept the three a s s u m p t i o n s on which the
P l a n is based, viz.. C h i l d r e n ' s iVllowances, a Comprehensive N a t i o n a l H e a l t h
Service a n d the M a i n t e n a n c e of E m p l o y m e n t . A s r e g a r d s the specific proposals
in t h e scheme, the G o v e r n m e n t could s t a t e t h a t they a r e disposed to accept certain
of t h e m in p r i n c i p l e ; t h a t there a r e some w h i c h do not commend themselves to
the G o v e r n m e n t ; a n d t h a t o t h e r s r e q u i r e f u r t h e r e x a m i n a t i o n . I n these l a t t e r
cases the G o v e r n m e n t S p o k e s m a n should p u t before t h e H o u s e the m a i n
c o n s i d e r a t i o n s which m u s t be t a k e n i n t o account, and t h u s a t t e m p t to guide
o p i n i o n to an u n d e r s t a n d i n g of them.
A s t a t e m e n t on these lines would be consistent w i t h the t e r m s of the
Resolution which h a s been p u t down.
7. W e deal first w i t h t h e t h r e e a s s u m p t i o n s on w h i c h t h e B e v e r i d g e P l a n
is based, namely :—
(a) C h i l d r e n ' s Allowances.
(b) A Comprehensive H e a l t h Service.
(c) T h e M a i n t e n a n c e of E m p l o y m e n t .
CHILDREN's ALLOWANCES.
8. S i r W i l l i a m B e v e r i d g e proposes t h a t a n allowance of 8*'. a week should
be p a i d for each child in a family after the first. These allowances would be
non-contributory.
9. F o r some t i m e p a s t , t h e r e h a s been a w i d e s p r e a d d e m a n d for the intro­
d u c t i o n of c h i l d r e n ' s allowances, a n d we a r e satisfied t h a t the p r i n c i p l e is one
w h i c h the G o v e r n m e n t should accept. W e also agree t h a t t h e allowances should
be p a i d to each child i n a family a f t e r the first, a n d t h a t they should be of
u n i v e r s a l a p p l i c a t i o n — i . e . , they should be p a i d in respect of all families, w i t h o u t
a n y income limit.
10. S i r W i l l i a m Beveridge reaches the figui'e of 8s. by a s s u m i n g 9s. a s the
cost of m a i n t a i n i n g a child a t subsistence level a n d by d e d u c t i n g I s . in respect
of services provided in k i n d . O u r view is t h a t the a m o u n t of t h e allowance should
be 5s., b u t t h a t , concurrently, every effort should be m a d e to s u p p l e m e n t this
allowance by developing to t h e m a x i m u m p r a c t i c a b l e e x t e n t o u r child welfare
services. T h e D e p a r t m e n t s concerned a r e e x a m i n i n g how f a r these services can
a p p r o p r i a t e l y be c a r r i e d .
11. W e recommend t h a t , in the f o r t h c o m i n g Debate, t h e Government
S p o k e s m a n should i n d i c a t e t h a t the G o v e r n m e n t favour a scheme of c h i l d r e n ' s
allowances a n d consider t h a t t h e a m o u n t of the allowance should be 5s. a n d that
i t should be p a i d for e a c h child a f t e r the first in every family. I t should be added
t h a t , concurrently, every effort will be m a d e to s u p p l e m e n t t h e allowance by
developing our child w e l f a r e services; a n d t h e o p p o r t u n i t y should be t a k e n to
-stress t h e e x t e n t to w h i c h such services have been p r o v i d e d d u r i n g t h e present
w a r , a n d the considerable benefit to t h e h e a l t h of school c h i l d r e n w h i c h has
accrued therefrom.
A
COMPREHENSIVE HEALTH
SERVICE.
12. S i r W i l l i a m Bevericlge assumes a c o m p r e h e n s i v e H e a l t h Service. T h i s
Service w o u l d be c o m p r e h e n s i v e i n t h e sense t h a t i t w o u l d cover the whole r a n g e
of p r e v e n t i v e a n d c u r a t i v e t r e a t m e n t . I t would also be of u n i v e r s a l a p p l i c a t i o n ;
t h a t is to say, a l t h o u g h p a r t of t h e cost of t h e scheme m i g h t be m e t by
c o n t r i b u t i o n s , every citizen w o u l d be e n t i t l e d to w h a t e v e r m e d i c a l t r e a t m e n t he
m i g h t r e q u i r e w i t h o u t c o n t r i b u t i o n c o n d i t i o n s in a n y i n d i v i d u a l case.
13. T h i s a s s u m p t i o n involves a v a s t p r o b l e m of o r g a n i s a t i o n w h i c h lies
o u t s i d e the scope of t h e B e v e r i d g e R e p o r t . T h e f o r m of t h e o r g a n i s a t i o n of t h e
h e a l t h services h a s for long been u n d e r c o n s i d e r a t i o n by t h e H e a l t h D e p a r t m e n t s
a n d by t h e medical profession. I t seems clear, not only t h a t f a r - r e a c h i n g c h a n g e s
a r e called for in t h e w a y of an i n t e g r a t i o n of e x i s t i n g services, b u t also t h a t
o p i n i o n i n t h e m e d i c a l profession h a s moved f a s t i n r e c e n t y e a r s a n d is r e a d j
for such c h a n g e s . F u r t h e r m o r e , i t w o u l d be of i m m e n s e a d v a n t a g e if such c h a n g e s
could be i n t r o d u c e d a t a t i m e when t h e t h o u s a n d s of doctors n o w in t h e Services
will be r e t u r n i n g to civil life a n d m a k i n g a fresh s t a r t .
14. W e a r e satisfied t h a t the t i m e h a s come w h e n s t e p s should be t a k e n t o
set u p a c o m p r e h e n s i v e H e a l t h Service covering all f o r m s of p r e v e n t i v e a n d
c u r a t i v e t r e a t m e n t . W e t h e r e f o r e recommend t h a t it should be s t a t e d i n t h e
f o r t h c o m i n g D e b a t e t h a t t h e G o v e r n m e n t accept in p r i n c i p l e the p r o j e c t of
e s t a b l i s h i n g a H e a l t h Service w h i c h w i l l be c o m p r e h e n s i v e in scope a n d u n i v e r s a l
in t h a t its services will be a v a i l a b l e to all members of t h e c o m m u n i t y . I t should,
however, be m a d e clear t h a t the e s t a b l i s h m e n t of such a Service w i l l n o t
a u t o m a t i c a l l y b r i n g to a n end the system of p r i v a t e m e d i c a l p r a c t i c e ; a n d t h a t
the v o l u n t a r y h o s p i t a l s w o u l d c o n t i n u e to play t h e i r p a r t in t h e h o s p i t a l system
of t h e c o u n t r y .
:
15. T h e d e t a i l s of such a Service must, of course, be w o r k e d o u t in
c o n s u l t a t i o n w i t h t h e m e d i c a l p r o f e s s i o n a n d t h e local a u t h o r i t i e s a n d o t h e r
o r g a n i s a t i o n s c o n c e r n e d ; a n d it is n o t possible a t t h i s s t a g e to forecast e x a c t l y
w h a t form it will t a k e . A w a r n i n g should be given t h a t , o w i n g t o t h e s h o r t a g e
of d e n t i s t s , o p h t h a l m o l o g i s t s , & c , i t will be m a n y y e a r s before the full r a n g e of
services c o n t e m p l a t e d in the B e v e r i d g e P l a n could be p r o v i d e d . T h e F l e a l t h
D e p a r t m e n t s will, however, o p e n discussions a t once w i t h r e p r e s e n t a t i v e s of t h e
medical profession a n d o t h e r i n t e r e s t s affected.
M A I N T E N A N C E OF
EMPLOYMENT.
16. S i r W i l l i a m B e v e r i d g e a s s u m e s " m a i n t e n a n c e of e m p l o y m e n t , " b u t
p o i n t s o u t t h a t t h i s does n o t m e a n c o m p l e t e abolition of u n e m p l o y m e n t . I n d e e d ,
in f r a m i n g t h e social s e c u r i t y b u d g e t , h e assumes a n a v e r a g e r a t e of u n e m p l o y ­
ment of a b o u t 10 p e r cent, of t h e classes a t p r e s e n t i n s u r e d .
Thus, the
a s s u m p t i o n i n t h e B e v e r i d g e P l a n is, in fact, t h a t m a s s u n e m p l o y m e n t such a s
results from e x t r e m e cyclical t r a d e d e p r e s s i o n s a n d l o n g - l a s t i n g s t r u c t u r a l
dislocations, w i l l be avoided.
17. T h e r e m a y well be a d a n g e r of a h i g h r a t e of u n e m p l o y m e n t for a s h o r t
period of d i s l o c a t i o n following t h e cessation of h o s t i l i t i e s . B u t , d u r i n g t h e t w o
or t h r e e y e a r s a f t e r t h e w a r , t h e p r o b l e m s to be faced, a r e likely to be, n o t so m u c h
the finding of e m p l o y m e n t — t h e r e will be p l e n t y of w o r k t o be d o n e — b u t r a t h e r
the d i r e c t i o n of effort a n d i n v e s t m e n t i n t o t h e r i g h t c h a n n e l s .
18. T h e longer t e r m p r o s p e c t s of m a i n t a i n i n g full
a m a t t e r of o p i n i o n . B u t m u c h m o r e is now k n o w n
unemployment, a n d t h e r e is every r e a s o n t o h o p e t h a t ,
n a t i o n a l co-operation a n d stable c o n d i t i o n s a t home,
avoiding its worst manifestations.
employment are inevitably
of t h e causes of cyclical
given a m e a s u r e of i n t e r ­
w e shall be successful i n
19: I t m a y be a d d e d t h a t a sound scheme of social s e c u r i t y m i g h t well, by
c r e a t i n g c o n d i t i o n s u n d e r w h i c h m e a s u r e s c a n m o r e e a s i l y be t a k e n for increasino­
the flexibility a n d mobility of labour, c o n s t i t u t e a s u b s t a n t i a l c o n t r i b u t i o n t o w a r d s
the m a i n t e n a n c e of employment.
20. W e a c c o r d i n g l y r e c o m m e n d t h a t i t should be s t a t e d in the D e b a t e t h a t ,
whilst t h e v a l i d i t y of t h i s a s s u m p t i o n c a n n o t be d e m o n s t r a t e d , a n d w h i l s t n o one
could confidently affirm t h a t t h i s p r o b l e m w i l l be completely solved, t h e G o v e r n ­
ment i n t e n d to m a k e every effort to achieve a n d m a i n t a i n a h i g h level of
[25024]
B
2
employment.
I n t h e i r opinion the level of e m p l o y m e n t will h a v e a more
f u n d a m e n t a l effect t h a n a n y o t h e r single factor on the p o s t - w a r n a t i o n a l income,
t h e steady increase of which is a c o n d i t i o n p r e c e d e n t to o u r a b i l i t y t o finance social
improvements.
F U N D A M E N T A L S OF T H E B E V E R I D G E
PLAN.
21. S p e a k i n g in broad general terms a n d a v o i d i n g t e c h n i c a l i t i e s , the
B e v e r i d g e R e p o r t is-presented as a p l a n for the abolition of w a n t t h r o u g h o u t the
community. A s p a r t of t h i s scheme, the P l a n proposed a flat r a t e of benefit d u r i n g
i n t e r r u p t i o n s of e a r n i n g s from all causes (subject to c e r t a i n e x c e p t i o n s in t h e case
of W o r k m e n ' s C o m p e n s a t i o n ) . I t is also proposed t h a t this r a t e , w h i c h would
be p a i d irrespective of the m e a n s or resources of the recipient, should be based
on s t a n d a r d s of subsistence, assessed on a n objective basis. I t is also a n essential
f e a t u r e of the scheme t h a t c o n t r i b u t i o n s a r e levied on t h e whole c o m m u n i t y and
t h a t the benefits a r e open to all.
22. I n c o n s i d e r i n g w h e t h e r the plan should be a d o p t e d , we m u s t therefore
consider t h e t h r e e following questions : —
(1) Should the scheme be of u n i v e r s a l a p p l i c a t i o n ?
(2) Should the same r a t e of benefit be p a y a b l e i n respect of all causes of
i n t e r r u p t i o n of e a r n i n g s , a n d should t h i s r a t e be a subsistence r a t e ?
(3) W h a t should be the r e l a t i o n s h i p between c o n t r i b u t i o n s a n d benefits ?
U N I V E R S A L I T Y OF I N S U R A N C E .
23. U n d e r t h e B e v e r i d g e P l a n , all citizens, a p a r t from those below w o r k i n g
age a n d those r e t i r e d above w o r k i n g age who will be beneficiaries, will be insured
a g a i n s t the m a i n h a z a r d s of sickness, accident, u n e m p l o y m e n t , old age a n d death.
W e a r e in f a v o u r of m a k i n g i n s u r a n c e u n d e r t h e P l a n u n i v e r s a l in the above sense,
a n d of a n n o u n c i n g o u r acceptance of t h i s p r i n c i p l e
R A T E S OF
BENEFIT.
24. I n view of the general a t t i t u d e w h i c h we recommend should be taken
as r e g a r d s the financial aspects of the B e v e r i d g e P l a n , we r e g a r d i t as
i n a p p r o p r i a t e to t a k e decisions as to any of the r a t e s of benefit or r a t e s of
c o n t r i b u t i o n proposed.
T h e only e x c e p t i o n is in t h e case of C h i l d r e n ' s
Allowances (see p a r a g r a p h 10), w h i c h a r e not so m u c h a p a r t of t h e i n s u r a n c e
scheme as a c o n d i t i o n p r e c e d e n t thereto.
25. I n these c i r c u m s t a n c e s we have n o t t h o u g h t it necessary to reach a
decision on the p r i n c i p l e set out in the B e v e r i d g e R e p o r t t h a t t h e r a t e s of benefit
should be sufficient to provide, w i t h o u t f u r t h e r resources, the m i n i m u m income
r e q u i r e d for subsistence in all n o r m a l cases. I n t h e case of P e n s i o n s o u r views
as set out in p a r a g r a p h s 33 to 36 do, however, imply t h e rejection of t h i s p r i n c i p l e
in t h a t p a r t of the field. A s r e g a r d s sickness a n d u n e m p l o y m e n t of short
d u r a t i o n , we a r e a g r e e d t h a t t h e r e would be a d v a n t a g e in m a k i n g the r a t e the
same in both cases, a n d we recommend an a n n o u n c e m e n t to t h i s effect.
For
sickness a n d u n e m p l o y m e n t of p r o l o n g e d d u r a t i o n , however, it m a y be necessary
to i n t r o d u c e special provisions in view of the obvious r i s k of abuse (see
p a r a g r a p h s 2 9 - 3 2 a n d 37-38).
26. I t should be p o i n t e d o u t t h a t i t is difficult to m a i n t a i n t h a t a n y flat r a t e
of benefit r e l a t e s to a subsistence level w h e n r e g a r d is p a i d to t h e w i d e v a r i a t i o n
of r e n t s between different a r e a s of t h e c o u n t r y a n d even in t h e same a r e a . In
p r a c t i c e it would be necessary to assume a reasonable a v e r a g e figure for r e n t and
to deal w i t h h i g h e r r e n t s by a d j u s t m e n t s a p p r o p r i a t e to the c i r c u m s t a n c e s of
each case.
27. W e t h i n k f u r t h e r c o n s i d e r a t i o n should be given to the q u e s t i o n w h e t h e r
t h e r e should be a d e p e n d a n t s ' allowance as a p a r t of benefit for t h e first child
in respect of whom, u n d e r our p r o p o s a l in p a r a g r a p h s 9 - 1 1 , no c h i l d r e n ' s
allowance will be payable.
CONTRIBUTIONS.
28. U n d e r the B e v e r i d g e P l a n C h i l d r e n ' s A l l o w a n c e s a r e n o n - c o n t r i b u t o r y .
A n a c t u a r i a l c o n t r i b u t i o n , a p p r o p r i a t e l y d i v i d e d between t h e w o r k e r , the
employer a n d t h e E x c h e q u e r is c a l c u l a t e d for each of t h e i n s u r a n c e benefits.' The
b a l a n c e of the a m o u n t which t h e w o r k e r a n d employer a r e assumed to be able
to p a y over t h e i r s h a r e of the a c t u a r i a l c o n t r i b u t i o n ' is t a k e n as a c o n t r i b u t i o n
to t h e Comprehensive H e a l t h Service. W e do not t h i n k i t necessary a t t h i s stao-e
to discuss w h a t the c o n t r i b u t i o n should be, but we a r e i n f a v o u r of a n n o u n c i n g
o u r a c c e p t a n c e of the p r i n c i p l e t h a t the scheme should be c o n t r i b u t o r y a n d t h a t
t h e r a t e of c o n t r i b u t i o n should be closely r e l a t e d to t h e a m o u n t of benefit
UNEMPLOYMENT.
Proposal
for
Compulsory'
Training
after
Long
Period
of
Unemployment.
The Incentive
to
Work.
29. S i r W i l l i a m B e v e r i d g e proposes t h a t t h e p e r i o d of u n c o n d i t i o n a l
u n e m p l o y m e n t benefit should be six m o n t h s , subject to c e r t a i n a d j u s t m e n t s , a n d
t h a t , t h e r e a f t e r , u n e m p l o y e d p e r s o n s should c o n t i n u e to be able to d r a w
u n e m p l o y m e n t benefit a t t h e full r a t e subject to a t t e n d a n c e , a s r e q u i r e d , a t a
w o r k or t r a i n i n g centre.
30. W e agree t h a t schemes of t r a i n i n g a r e of t h e u t m o s t i m p o r t a n c e i n
p r e v e n t i n g u n e m p l o y m e n t a n d in s e c u r i n g fluidity of labour, a n d t h a t a l l
p r a c t i c a b l e steps should be t a k e n to develop schemes to this end. On t h e o t h e r
h a n d , we a r e satisfied t h a t a r e q u i r e m e n t c a l l i n g u p o n persons to u n d e r g o t r a i n i n g ,
a f t e r a c e r t a i n p e r i o d of u n e m p l o y m e n t , w o u l d not c o n s t i t u t e a n effective s a f e ­
g u a r d a g a i n s t abuse in a system w h e r e b y u n e m p l o y m e n t benefit w a s p a i d for
indefinite periods.
Moreover, such a provision would m i l i t a t e a g a i n s t t h e
effectiveness of v o l u n t a r y t r a i n i n g a s a m e a n s of e n s u r i n g flexibility of labour.
31. W e believe, therefore, t h a t some l i m i t a t i o n m u s t be placed on t h e p e r i o d
for w h i c h u n e m p l o y m e n t benefit is p a i d . W e do not, however, consider i t d e s i r a b l e
to specify a t p r e s e n t w h a t this p e r i o d should be. I n d e e d , it m i g h t be a p p r o p r i a t e
to i n t r o d u c e some e l a s t i c i t y into these a r r a n g e m e n t s so a s to avoid u n e m p l o y m e n t
benefit t e r m i n a t i n g a u t o m a t i c a l l y a t the end of a given period, i r r e s p e c t i v e of
the g e n e r a l s t a t e of t r a d e .
32. Nevertheless, we believe it to be essential t h a t t h e p u b l i c should receive
e a r l y w a r n i n g of t h e f a c t t h a t a r r a n g e m e n t s , w h i c h m a y t e n d to be s t i g m a t i s e d
as reminiscent of t h e M e a n s Test, will be necessary to avoid t h e abuse of the r a t e s
of benefit a n d provisions c o n t e m p l a t e d in t h i s scheme. W e t h e r e f o r e r e c o m m e n d
t h a t t h e G o v e r n m e n t S p o k e s m a n in t h e f o r t h c o m i n g D e b a t e should m a k e a clear
a n d positive s t a t e m e n t to the effect t h a t it w i l l be vitally necessary to i n t r o d u c e
some system w h i c h will p r o v i d e a s t r o n g check a g a i n s t abuses.
(The c o r r e s p o n d i n g position in r e g a r d to sickness is dealt w i t h in p a r a ­
g r a p h s 37 a n d 38.)
OLD AGE
PENSIONS.
33. T h e u l t i m a t e cost of t h e scheme of old age p e n s i o n s r e c o m m e n d e d by
S i r W i l l i a m B e v e r i d g e is the most f o r m i d a b l e element in h i s P l a n from t h e
financial p o i n t of view. T h e cost of old age pensions, in r e l a t i o n to t h a t of a l l
o t h e r forms of social i n s u r a n c e , m u s t i n e v i t a b l y increase on account of t h e l a r g e
p r o s p e c t i v e increase in t h e p r o p o r t i o n of people of pensionable age in t h e p o p u l a ­
tion as a whole. T h e tables p r i n t e d on p a g e 91 of t h e B e v e r i d g e R e p o r t show t h a t ,
unless p r e s e n t p o p u l a t i o n t r e n d s u n d e r g o some r a d i c a l c h a n g e , the cost of
m a i n t a i n i n g in old a g e t h e n o n - p r o d u c t i v e element in the p o p u l a t i o n w i l l i m p o s e
in t h e y e a r s a h e a d a heavy a n d i n c r e a s i n g s t r a i n on the p r o d u c t i v e sections of t h e
community.
34. T h e cost in 1965 of the B e v e r i d g e Scheme for old a g e p e n s i o n s w o u l d
be £ 3 0 0 millions a y e a r . B u t , w h i l e c o n t r i b u t i o n s a p p r o p r i a t e to t h e full r a t e of
pensions w o u l d begin to be p a y a b l e i m m e d i a t e l y a f t e r t h e i n t r o d u c t i o n of t h e
scheme, pensions a t t h e full r a t e s w o u l d not b e . r e a c h e d for t w e n t y years.
35. I n o u r view, t h e scheme of old a g e pensions r e c o m m e n d e d
B e v e r i d g e R e p o r t m u s t be rejected on the double g r o u n d —
in
the
(i) t h a t i t would not be acceptable to p u b l i c opinion^ in view of t h e l a r g e
d i s p a r i t y between the r a t e s of p e n s i o n s payable' a t t h e b e g i n n i n g a n d
a t the end of t h i s t r a n s i t i o n a l p e r i o d ; a n d
(ii) t h a t it would be unjustifiable to c o m m i t f u t u r e G o v e r n m e n t s to t h e very
l a r g e e x p e n d i t u r e involved in the l a t e r stages of t h e scheme.
[25024]
3
B
W e believe t h a t public feeling in favour of g e n e r o u s t r e a t m e n t for old people
w i l l have to be met by the a d o p t i o n of an a l t e r n a t i v e scheme p r o v i d i n g for a
l a r g e r i m m e d i a t e increase in the e x i s t i n g r a t e s of old age p e n s i o n s t h a n is
p r o v i d e d for in the B e v e r i d g e p l a n ; and t h a t , given such a n increase, t h e q u e s t i o n
of p r o m i s i n g still h i g h e r rates in the more d i s t a n t f u t u r e , to which t h e r e is very
s t r o n g objection, Would not arise.
36. W e suggest t h a t in the f o r t h c o m i n g D e b a t e the G o v e r n m e n t should t a k e
the line t h a t they m u s t reject the scheme of old age pensions p r o p o s e d by
Sir W i l l i a m Beveridge for the reasons i n d i c a t e d in p a r a g r a p h 35 above.
It
should, however, be s t a t e d t h a t the G o v e r n m e n t are p r e p a r e d to consider w h a t
increase should be m a d e in t h e e x i s t i n g pension r a t e s ; a n d t h a t , while no figures
can be given a t this stage, it is contemplated t h a t a n y increases w h i c h it m a y be
found p r a c t i c a b l e to m a k e would t a k e the form of fixed, a n d n o t i n c r e a s i n g , r a t e s
a n d would become t h e effective r a t e s i m m e d i a t e l y upon t h e i n t r o d u c t i o n of the
n e w scheme. I t should be m a d e clear t h a t the G o v e r n m e n t reject S i r W i l l i a m
B e v e r i d g e ' s proposal t h a t t h e r a t e s for old age pensions should be t h e same as
those for u n e m p l o y m e n t a n d sickness benefit. T h e G o v e r n m e n t would, however,
propose to i n c o r p o r a t e in a n y new scheme S i r W i l l i a m B e v e r i d g e ' s p r o p o s a l s
t h a t pensions should be c o n d i t i o n a l on r e t i r e m e n t from work, a n d t h a t persons
electing to continue at work a f t e r r e a c h i n g the m i n i m u m pensionable a g e should
receive an a p p r o p r i a t e i n c r e m e n t in respect of each y e a r worked a f t e r r e a c h i n g
t h a t age.
INVALIDITY.
37. T h e difficulty of c o n t r o l l i n g a c o n t i n u i n g d i s a b i l i t y benefit of s u b s t a n t i a l
a m o u n t is likely to be increased if, as we propose in p a r a g r a p h 3 1 . unemploy­
m e n t i n s u r a n c e benefit is l i m i t e d in d u r a t i o n .
T h e r e would be g r a v e difficulty
in a v o i d i n g abuse u n d e r a system whereby d i s a b i l i t y benefit w a s p a y a b l e a t the
full r a t e , however long the c l a i m a n t r e m a i n e d sick.
38. W e consider t h a t a clear w a r n i n g should be given t h a t some m e a n s
will h a v e to be found of c h e c k i n g such a b u s e s — p r o b a b l y by p r o v i d i n g t h a t ,
where a person is not likely to recover h i s e a r n i n g c a p a c i t y , d i s a b i l i t y benefit
will be replaced by an i n v a l i d i t y allowance at the p e n s i o n r a t e , i.e., in effect a
p r e m a t u r e old age pension. I t m i g h t be difficult to d e f e n d a p r o v i s i o n by which
t h i s t r a n s f e r w a s m a d e a u t o m a t i c a l l y a f t e r a n a r b i t r a r y p e r i o d of d i s a b i l i t y
benefit, a n d the d e t a i l e d a r r a n g e m e n t s would r e q u i r e f u r t h e r c o n s i d e r a t i o n .
WORKMEN's
COMPENSATION.
39. T h e proposal in the Beveridge R e p o r t is t h a t w o r k m e n ' s c o m p e n s a t i o n
should be unified w i t h , and become p a r t of, t h e g e n e r a l social i n s u r a n c e scheme,
but w i t h the following two exceptions : —
(1) T h a t in cases l a s t i n g more t h a n 13 weeks t h e w o r k m a n should be e n t i t l e d ,
in lieu of o r d i n a r y benefit (other t h a n c h i l d r e n ' s allowances), to a
disability p e n s i o n e q u a l to t w o - t h i r d s of h i s e a r n i n g s (or, in the case
of p a r t i a l ' i n c a p a c i t y , a p r o p o r t i o n a t e a m o u n t ) , u p to a m a x i m u m
of £ 3 . T h e r e would also be a n i n d u s t r i a l d e a t h g r a n t .
(2) T h a t in any i n d u s t r y w i t h r i s k s above the n o r m a l the e m p l o y e r should
p a y a special levy equal to t w o - t h i r d s of t h e excess costs.
40. T h e first p o i n t is w h e t h e r w o r k m e n 's compensation should be
included in the c o n t r i b u t o r y i n s u r a n c e scheme i n s t e a d of r e m a i n i n g a liability
of t h e employer. I t is generally accepted t h a t the p r e s e n t w o r k m e n ' s compensa­
tion system r e q u i r e s revision.
I t s inclusion in t h e g e n e r a l social security
scheme would have t h e a d v a n t a g e t h a t it would serve to d i m i n i s h friction
between employers a n d w o r k m e n to w h i c h t h e p r e s e n t system gives rise.
It
would also, of course, do a w a y w i t h t h e difficulties of d e m a r c a t i o n between
accidents a n d sickness.
41. On t h e o t h e r h a n d , it is a r g u e d t h a t the inclusion of w o r k m e n ' s
compensation in a c o n t r i b u t o r y i n s u r a n c e scheme, by r e l e a s i n g employers from
t h e i r liability, would remove w h a t some consider t o be a p o w e r f u l incentive to
safety
I n p a r t i c u l a r it would relieve employers of t h e i r incentive to find work
for t h e i r employees in cases of p e r m a n e n t d i s a b i l i t y . I t is also a r g u e d t h a t it is
u n r e a s o n a b l e t h a t w o r k m e n should be asked to m a k e a n y c o n t r i b u t i o n t o w a r d s the
cost of i n d u s t r i a l accidents.
42. I t h a s been suggested, as a n a l t e r n a t i v e , t h a t w o r k m e n ' s c o m p e n s a t i o n
should be e x c l u d e d from t h e p r o p o s e d Social S e c u r i t y Scheme : b u t t h a t , i n s t e a d
of c o n t i n u i n g , to be the l i a b i l i t y of i n d i v i d u a l e m p l o y e r s , it should be financed by
levies s p r e a d over the whole body of e m p l o y e r s in all i n d u s t r i e s . I t is clear,
however, t h a t before any scheme on these lines could be a d o p t e d , the whole q u e s t i o n
of w o r k m e n ' s c o m p e n s a t i o n w o u l d h a v e to be t h e subject of special i n v e s t i g a t i o n .
T h e r e is also the c o n s i d e r a t i o n t h a t , if t h e G o v e r n m e n t were to decide t h a t
w o r k m e n ' s c o m p e n s a t i o n should r e m a i n o u t s i d e t h e Social S e c u r i t y p l a n , t h i s
would lend s u p p o r t to those w h o a r g u e t h a t u n e m p l o y m e n t i n s u r a n c e s h o u l d
likewise be e x c l u d e d from the Social S e c u r i t y p l a n , as b e i n g a r i s k to w h i c h
different sections of the c o m m u n i t y a r e liable in w i d e l y differing degrees.
43. I f w o r k m e n ' s c o m p e n s a t i o n is b r o u g h t i n t o t h e scheme, t w o o t h e r
q u e s t i o n s a r i s e . T h e first is w h e t h e r , a s s u m i n g unification w i t h the g e n e r a l
security scheme, t h e r e should be (as p r o p o s e d by S i r W i l l i a m B e v e r i d g e )
differential t r e a t m e n t for cases of i n d u s t r i a l d i s a b i l i t y l a s t i n g more t h a n a c e r t a i n
period. T h i s p r o p o s a l r e i n t r o d u c e s a f t e r t h e e n d of t h a t p e r i o d t h e p r i n c i p l e o n
w h i c h w o r k m e n ' s c o m p e n s a t i o n is now assessed a n d is d e s i g n e d to m e e t t h e
difficulties w h i c h would a r i s e if t h a t p r i n c i p l e w e r e completely a b a n d o n e d . I t is
a t v a r i a n c e , however, w i t h t h e p r i n c i p l e i n the B e v e r i d g e P l a n t h a t t h e s a m e
r a t e s of benefit should be given for t h e same c o n t r i b u t i o n . Moreover, i t h a s a l s o
the d i s a d v a n t a g e t h a t it w o u l d be likely to h a v e s u b s t a n t i a l r e p e r c u s s i o n s on w a r
pensions.
44. T h e second p o i n t a r i s i n g from t h e p r o p o s a l in t h e B e v e r i d g e P l a n is
w h e t h e r t h e r e should be a special levy on h a z a r d o u s i n d u s t r i e s . T h e p r i n c i p a l
objection to t h i s proposal is t h a t i t w o u l d fall t o be borne by i n d u s t r i e s some of
which h a v e h i g h labour costs a n d a r e e n g a g e d in t h e e x p o r t t r a d e . On t h e o t h e r
h a n d , i t c a n be a r g u e d t h a t the h i g h r a t e of r i s k involved in h a z a r d o u s i n d u s t r i e s
r e p r e s e n t s a n e l e m e n t in t h e cost of p r o d u c t i o n w h i c h should p r o p e r l y be reflected
in the p r i c e of t h e i r p r o d u c t s ; a n d it w o u l d n o t be easy to defend a s y s t e m
w h e r e b y p a r t of t h i s cost w o u l d be borne by i n d u s t r i e s (not all of w h i c h a r e
p r o s p e r o u s ) w i t h lower r i s k s .
45. T h i s subject is complex a n d r e q u i r e s f u r t h e r e x a m i n a t i o n . Moreover,
it is one on w h i c h t h e d e b a t e i n t h e H o u s e is likely to p r o v e i n s t r u c t i v e .
We
recommend t h a t the G o v e r n m e n t S p o k e s m a n in t h e f o r t h c o m i n g d e b a t e should
content himself w i t h e x p l a i n i n g t h e a r g u m e n t s for a n d a g a i n s t the p r o p o s a l s
c o n c e r n i n g w o r k m e n ' s compensation i n the B e v e r i d g e P l a n , a n d n o t i n g t h e views
expressed.
APPROVED
SOCIETIES.
46. T h e B e v e r i d g e R e p o r t r e a c h e s the conclusion t h a t , a s s u m i n g t h e unifica­
tion of all f o r m s of social i n s u r a n c e , t h e r e is no justification for t h e r e t e n t i o n of
A p p r o v e d Societies as i n d e p e n d e n t financial u n i t s . A t the same time, however,
S i r W i l l i a m p u t s f o r w a r d the t e n t a t i v e p r o p o s a l t h a t these societies should be
employed as a g e n t s for a d m i n i s t e r i n g d i s a b i l i t y benefit u n d e r the unified scheme.
47. W e a r e satisfied t h a t t h e first conclusion is inescapable. T h e g r o w i n g
i n e q u a l i t y of benefits g r a n t e d by t h e different societies is, in o u r opinion, i n itself
a sufficient justification for t h i s view. M o r e o v e r , t h e i n c r e a s e in t h e scale
of benefits p r o p o s e d u n d e r the P l a n w o u l d t e n d to e m p h a s i s e t h i s i n e q u a l i t y still
further.
48. W e s h a r e the view t h a t A p p r o v e d Societies should, if possible, be
employed as responsible a g e n t s for t h e a d m i n i s t r a t i o n of d i s a b i l i t y benefit to
t h e i r members. T h e r e are, however, a n u m b e r of p o i n t s w h i c h will r e q u i r e f u r t h e r
c o n s i d e r a t i o n before i t can be decided w h e t h e r t h i s is p r a c t i c a b l e .
49. W e a r e a d v i s e d t h a t t h e A p p r o v e d Societies w o u l d themselves welcome
an e a r l y s t a t e m e n t on t h e subject of the G o v e r n m e n t s i n t e n t i o n s in r e g a r d to
their f u t u r e . W e a c c o r d i n g l y r e c o m m e n d t h a t t h e G o v e r n m e n t S p o k e s m a n in
t h e f o r t h c o m i n g D e b a t e should s t a t e t h a t t h e c o n t i n u e d existence of the a p p r o v e d
societies as i n d e p e n d e n t financial u n i t s is clearly i n c o m p a t i b l e w i t h t h e basic
conception of a comprehensive social s e c u r i t y p l a n ; t h a t t h e e x t e n t to w h i c h i t
m i g h t be possible to m a k e use of t h e services of t h e A p p r o v e d Societies w i t h i n t h e
f r a m e w o r k of a c o m p r e h e n s i v e scheme w a s e x a m i n e d i n a t e n t a t i v e w a y i n t h e
-Beveridge R e p o r t ; a n d t h a t the G o v e r n m e n t a r e r e a d y to give f u r t h e r c o n s i d e r a ­
tion to t h i s possibility.
D E A T H B E N E F I T AND I N D U S T R I A L
ASSURANCE.
50. W e are in favour of a c c e p t i n g the p r o p o s a l t h a t d e a t h benefit should be
one of the benefits u n d e r the unified scheme of social i n s u r a n c e (the a m o u n t , a n d
the t r a n s i t i o n a l a r r a n g e m e n t s desirable in view of e x i s t i n g i n s u r a n c e s , being
reserved for f u r t h e r consideration). W e recommend the rejection of t h e t e n t a t i v e
r e c o m m e n d a t i o n in the Beveridge R e p o r t t h a t i n d u s t r i a l a s s u r a n c e a s a whole
should be converted into a public service u n d e r an I n d u s t r i a l A s s u r a n c e B o a r d .
W e t h i n k t h a t both these decisions m i g h t well be a n n o u n c e d in the f o r t h c o m i n g
Debate.
51. W e record our opinion t h a t t h e i n s t i t u t i o n of a d e a t h benefit does not
give a valid claim for compensation to e i t h e r t h e a g e n t s or t h e s h a r e h o l d e r s of the
insurance institutions.
WIDOWS'
BENEFITS.
52. S i r W i l l i a m Beveridge proposes t h a t w i d o w s u n d e r the age of 60 should
receive benefit a t the r a t e of 36s. a week for 13 weeks, a n d t h a t t h e r e a f t e r they
should be eligible, so long as there are d e p e n d e n t children, for gTiardian benefit
a t t h e r a t e of 24s., subject to r e d u c t i o n for e a r n i n g s , and subsequently only for
t r a i n i n g benefit.
53. W e consider t h a t , w h i l e t h e e x i s t i n g scheme of w i d o w s ' pensions m a y be
open to criticism in respect of the p a y m e n t of pensions to relatively y o u n g w i d o w s
w i t h o u t children, t h e Beveridge p r o p o s a l will be r e g a r d e d a s u n d u l y h a r s h . W e
accordingly recommend t h a t it should be s t a t e d in the f o r t h c o m i n g D e b a t e t h a t
the G o v e r n m e n t w i l l wish to give f u r t h e r c o n s i d e r a t i o n to t h i s m a t t e r in the l i g h t
of the views expressed in the Debate.
ADMINISTRATION.
54.
W e are agreed—
(1) T h a t the a d m i n i s t r a t i o n of t h e i n s u r a n c e side of t h e e n t i r e Social
S e c u r i t y scheme should be consolidated in one o r g a n i s a t i o n , which
m i g h t t a k e the form of a B o a r d , t h e c o n s t i t u t i o n a l p o s i t i o n of which
would be analogous to t h a t of the A s s i s t a n c e B o a r d .
(2) T h a t t h i s step should t a k e place a f t e r the necessary legislation h a s been
passed t h r o u g h P a r l i a m e n t , a n d t h a t , if a t all possible, t h i s should be
done by means of a single Bill.
(3) T h a t in the m e a n t i m e the d e t a i l e d w o r k i n g o u t of the scheme, in
accordance w i t h decisions of p r i n c i p l e to be t a k e n by the W a r Cabinet,
should be r e m i t t e d to t h e C o m m i t t e e of Officials u n d e r t h e C h a i r m a n ­
s h i p of S i r T h o m a s P h i l l i p s . T h i s w o r k w o u l d be c a r r i e d out u n d e r
the g e n e r a l s u p e r v i s i o n of t h e M i n i s t e r w i t h o u t P o r t f o l i o .
W e t h i n k t h a t , if necessary, an a n n o u n c e m e n t in g e n e r a l t e r m s on t h e above
lines m i g h t be m a d e in the f o r t h c o m i n g D e b a t e . C a r e should, however, be taken
to m a k e it clear t h a t the G o v e r n m e n t a r e not c o m m i t t e d to t h e e s t a b l i s h m e n t of
a new M i n i s t r y for t h i s purpose.
SUMMARY
55.
OF
RECOMMENDATIONS.
O u r r e c o m m e n d a t i o n s m a y be s u m m a r i s e d as f o l l o w s : —
(i) General.—We i n d i c a t e in p a r a g r a p h 6 t h e g e n e r a l line w h i c h we
r e c o m m e n d t h a t t h e G o v e r n m e n t S p o k e s m a n should t a k e i n the
f o r t h c o m i n g D e b a t e about the Social S e c u r i t y scheme as a whole,
a n d , in p a r t i c u l a r , i t s financial i m p l i c a t i o n s , h a v i n g r e g a r d to other
d e m a n d s on our resources.
(ii) Children's A l l o w a n c e s . — I t should be s t a t e d in t h e D e b a t e t h a t the
G o v e r n m e n t favour a scheme of c h i l d r e n ' s allowances, a n d consider
t h a t the a m o u n t of the allowances should be 5s. for each child
a f t e r t h e first; a n d t h a t c o n c u r r e n t l y every effort w o u l d be m a d e
to s u p p l e m e n t t h e allowance by developing our child welfare services
( p a r a g r a p h 11).
(iii) Comprehensive H e a l t h S e r v i c e . - I t s h o u l d be s t a t e d i n t h e D e b a t e
t h a t t h e G o v e r n m e n t accept in p r i n c i p l e t h e p r o j e c t of e s t a b l i s h i n g
a h e a l t h service, c o m p r e h e n s i v e in scope a n d a v a i l a b l e to all m e m b e r s
of the c o m m u n i t y . N e g o t i a t i o n s w i t h t h e i n t e r e s t s c o n c e r n e d w i l l
be begun a t once ( p a r a g r a p h s 14 a n d 15).
(iv) W e i n d i c a t e t h e line to be t a k e n in t h e D e b a t e on t h e M a i n t e n a n c e
of Employment ( p a r a g r a p h 2 0 ) .
(v) U n i v e r s a l i t y . — W e r e c o m m e n d a n n o u n c e m e n t of o u r a c c e p t a n c e of
t h e p r i n c i p l e t h a t the scheme of i n s u r a n c e should be of u n i v e r s a l
a p p l i c a t i o n ( p a r a g r a p h 23).
(vi) R a t e s of Benefit.—We a r e in favour of m a k i n g t h e r a t e of benefit
t h e same for sickness a n d u n e m p l o y m e n t of s h o r t d u r a t i o n , a n d
r e c o m m e n d a n a n n o u n c e m e n t to t h i s effect. W e do not r e g a r d i t
as a p p r o p r i a t e to t a k e decisions a t t h i s j u n c t u r e a s to t h e r a t e s of
benefits u n d e r t h e scheme, e x c e p t in t h e case of c h i l d r e n ' s a l l o w a n c e s
(paragraphs 24-27).
(vii) Contributions.—We favour a n n o u n c i n g o u r a c c e p t a n c e of t h e
p r i n c i p l e t h a t the scheme should be c o n t r i b u t o r y , a n d t h a t the r a t e
of c o n t r i b u t i o n should be closely r e l a t e d to t h e a m o u n t of benefit;
b u t we do not t h i n k it necessary to discuss a t t h i s s t a g e w h a t t h e
r a t e s of c o n t r i b u t i o n should be ( p a r a g r a p h 28).
(viii) U n e m p l o y m e n t . — A r e q u i r e m e n t c a l l i n g u p o n p e r s o n s to u n d e r g o
t r a i n i n g a f t e r a c e r t a i n p e r i o d of u n e m p l o y m e n t does n o t c o n s t i t u t e
a n effective s a f e g u a r d a g a i n s t abuse in a system w h e r e b y
u n e m p l o y m e n t benefit is p a i d for indefinite p e r i o d s . W e r e c o m m e n d
t h a t some l i m i t a t i o n should b e ' p l a c e d on the p e r i o d for w h i c h
u n e m p l o y m e n t benefit is p a i d , but we a r e n o t i n a p o s i t i o n to say
w h a t t h a t p e r i o d should be. I t should be s t a t e d in t h e D e b a t e t h a t
it will be v i t a l l y necessary to i n t r o d u c e some system to p r o v i d e
a
strong
check
against
abuses
of
unemployment
benefit
(paragraphs 29-32).
(ix) Old A g e P e n s i o n s . — W e r e c o m m e n d t h a t t h e G o v e r n m e n t should
t a k e t h e line i n t h e D e b a t e t h a t they m u s t r e j e c t t h e scheme of
old age p e n s i o n s proposed by S i r W i l l i a m B e v e r i d g e . I t s h o u l d be
s t a t e d t h a t t h e G o v e r n m e n t a r e p r e p a r e d to consider w h a t i n c r e a s e s
should be m a d e i n e x i s t i n g pension r a t e s . T h e s e i n c r e a s e s w o u l d
t a k e the form of fixed r a t e s , a n d not r a t e s o n a r i s i n g scale. W h i l e
n o figure can be m e n t i o n e d a t t h i s stage, i t should be i n d i c a t e d t h a t
t h e G o v e r n m e n t p r o p o s e to i n c o r p o r a t e i n a n y n e w scheme t h e
B e v e r i d g e p r o p o s a l t h a t p e n s i o n s should be c o n d i t i o n a l on r e t i r e ­
m e n t from w o r k , a n d t h a t p e r s o n s e l e c t i n g to c o n t i n u e a t w o r k a f t e r
r e a c h i n g the m i n i m u m p e n s i o n a b l e age should receive a n a p p r o p r i a t e
i n c r e m e n t in r e s p e c t of each y e a r w o r k e d a f t e r r e a c h i n g t h a t a g e
( p a r a g r a p h 36).
(x) I n v a l i d i t y . — A c l e a r w a r n i n g should be given i n t h e D e b a t e t h a t
some m e a n s w i l l h a v e to be f o u n d of c h e c k i n g t h e abuse of d i s a b i l i t y
benefit, e.g., by p r o v i d i n g t h a t , w h e r e a p e r s o n is n o t likely to
recover h i s e a r n i n g c a p a c i t y , d i s a b i l i t y benefit wnll be r e p l a c e d by
a n i n v a l i d i t y a l l o w a n c e a t t h e p e n s i o n r a t e ( p a r a g r a p h 38).
(xi) Workmen's C o m p e n s a t i o n . — T h e G o v e r n m e n t S p o k e s m a n s h o u l d
e x p l a i n the a r g u m e n t s for a n d a g a i n s t the p r o p o s a l s i n t h e
Beveridge Report,
and
should
note
the
views
expressed
( p a r a g r a p h 45).
(xii) A p p r o v e d
Societies.—We
recommend
that
the
Government
S p o k e s m a n s h o u l d s t a t e t h a t t h e c o n t i n u e d e x i s t e n c e of t h e
A p p i w e d Societies as i n d e p e n d e n t
financial
u n i t s is clearly
i n c o m p a t i b l e w i t h the basic conception of a c o m p r e h e n s i v e social
The
security plan.
further
c o n s i d e r a t i o n to the of t h e
A p p r o v e d Societies w i t h i n the f r a m e w o r k of a c o m p r e h e n s i v e
scheme ( p a r a g r a p h 49).
* i
i
r m
r i
i '
r
.
^
(xiii) Death Benefit.—We r e c o m m e n d a n a n n o u n c e m e n t in t h e D e b a t e t h a t
D e a t h Benefit should be one of the benefits u n d e r the unified scheme
of Social I n s u r a n c e (the a m o u n t a n d t r a n s i t i o n a l a r r a n g e m e n t s
being reserved), b u t t h a t it is n o t proposed to convert i n d u s t r i a l
i n s u r a n c e a s a whole i n t o a P u b l i c Service u n d e r a n I n d u s t r i a l
A s s u r a n c e B o a r d ( p a r a g r a p h 50).
(xiv) W i d o w s ' P e n s i o n s . - W e t h i n k t h a t t h e B e v e r i d g e p r o p o s a l s will be
r e g a r d e d as u n d u l y h a r s h , a n d recommend t h a t it should be s t a t e d
in t h e D e b a t e t h a t t h e G o v e r n m e n t w i s h to give f u r t h e r
c o n s i d e r a t i o n to t h i s m a t t e r in the l i g h t of t h e views expressed
( p a r a g r a p h 53).
(xv) A d m i n i s t r a t i o n . — W e suggest t h e lines on w h i c h a n a n n o u n c e m e n t
m i g h t be m a d e ( p a r a g r a p h 54).
On behalf of the C o m m i t t e e :
J. A.
(Chairman).
Privy
Council
February
Office, S.W.
11, 1943.
1,