Arnold Gridley – 1943 Speech on the Beveridge Report

Below is the text of the speech made by Sir Arnold Gridley, the then Conservative MP for Stockport, in the House of Commons on 16 February 1943.

I beg to support the Motion. The right hon. Gentleman who moved it rightly described it as a peg on which to hang our observations. It will be found that I largely agree with much that he has said. [An HON. MEMBER: “How much?”] I cannot, and I do not propose to, cover so wide a field as he did, but will condense my observations to certain aspects of the Report. A few months ago we were considering the Beveridge coupon fuel-rationing scheme, which I then felt it my duty stoutly to oppose. Well, we managed without it. [An HON. MEMBER: “Thanks ​ to the weather.”] The necessary economies have been secured by our housewives and industrial users of coal, with retention of the good will of the country. To-day we are considering a far more important scheme from the same author.

I was interested, as the House will be, perhaps, in one or two other productions from his mind and pen. In my researches I have found that in 1912 he wrote “An Anthology of Thoughts on Women.” I wonder whether those thoughts are the same to-day. Then, in the middle of the last war, he brought forth a production which was entitled, “Swish, a Submarine War Game.” In 1931 he wrote on the causes and cures of unemployment. Today that strikes me as being a little curious, as, with great candour, I think it was in December, at Oxford, Sir William Beveridge said that he did not know how to cure unemployment and doubted very much whether anyone else did.

Mr. MacLaren

He said that twice.

Sir A. Gridley

In 1932 there was another volume published’, entitled “Changes in Family Life.” I think we can all agree that the Report which we are considering to-day will bring about a great many changes in family life, no doubt many of them for the better. It is no exaggeration to say that we are today discussing domestic matters of greater importance than have been brought before this House for many years past. I do not go so far as those who claim to be able to say that the Beveridge plan has received almost universal approval. I sometimes wonder how those who claim to speak for the people of the country, including the Fighting Services scattered in their thousands all over the world, can claim to interpret what those people are thinking. It is claimed that what they are fighting for are a better world and a higher standard of living. My own view, and I think what most of us realise, is that what we are fighting for is our very existence, and most certainly for freedom and for peace in the world after the war, not only for ourselves but for all civilised countries. I think one would not be far from the truth if one said that the question uppermost in the minds of the men in our Fighting Services to-day is whether good jobs and work in plenty will be available for them on their return. They ​ are probably much more concerned about that than the better world which so many refer to but about which definition would probably vary very widely. It is for the abolition of war and for a world in Which our children will not have to fight for their existence that we are primarily fighting to-day.

As to the Report itself, one cannot study it without appreciating more and more the great skill and ability of its author. Yet even he is not infallible. None of us is. He himself points out that many of his proposals have to be worked out before they can be adopted. He calls attention to the five evils of want, disease, idleness, squalor and ignorance. Squalor and ignorance can be tackled by better housing and improved education, which are outside his Report. He says much about the abolition of want, but his proposals in fact go far beyond meeting that need. I wonder sometimes how want is really denned. Can it necessarily be met by any specific monetary sum? The family of the hard working, thrifty husband and wife may be free from want on £3 a week. On the other hand, the family of a father who is a hard drinker, or gambler, or a spendthrift, may be very hard put to it if his wages are £5 or £6 a week. Nothing will make all of us alike in this world of frail human creatures. If it could, there would not be Conservatives, Socialists, Liberals, Independents and so on who make up this House.

Until recent years there was no yardstick by which real want could be measured. Since public assistance was made available it can be measured. In 1938 the aggregate of payments made on proof of need totalled £135,000,000. It may be urged, and I would agree, that this sum does not necessarily signify the total needed to abolish real want. Therefore I will put the sum up to £175,000,000, or £200,000,000, to take a considerably higher figure. But in 1938 another £207,000,000 was paid out as insurance benefit of legal right, irrespective of need. The relative figure in the Beveridge proposal would be £650,000,000 in 1945 and £826,000,000 in 1965. I do not want to be controversial here at all, but clearly there is an immense sum here over and above that which is required for meeting real want.

Mr. S. O. Davies (Merthyr)

I understood the hon. Member to admit a few moments ago that he personally could not possibly define the meaning of the word “want.” In that case will he be good enough to say what is the relationship between the figures he is now bandying about and something which he cannot understand and cannot define?

Sir A. Gridley

I think that what I have already said makes that perfectly clear. It is because I cannot assess what real want amounts to that I put up the figure of £135,000,000 to £175,000,000 or £200,000,000. That, I take it, is the answer. I do not think anyone can define what want is. It all depends on the character of the family. The question we must face and ask ourselves is whether it is right to draw upon the personal income of all classes, including the workers, to enable vast sums to be paid in the aggregate to those who are not in real want. The real objective, as Sir William Beveridge has admitted over and over again, is not to abolish want, with which everyone would agree without reservation, but the redistribution of income, and opinions may differ as to how far or how much further this should be compulsorily carried.

I want to put in here just one short plea, that in our consideration of these problems we should not forget the middle classes of this country. They are quite unorganised and, therefore, completely inarticulate, and life for thousands of them is an ever increasing burden. I am talking about the people of from £500 to £1,000 a year. Life is very hard for them under present taxation.

Mr. McGovern

The hon. Member said earlier that he was supporting the Motion, and the Mover demanded the carrying out of these plans almost immediately. Does he agree to that, or is he condemning that?

Sir A. Gridley

If the hon. Member will allow me to continue my own speech in my own way, he will very soon discover where I stand.

Mr. McGovern

The hon. Member is speaking a lot but saying nothing.

Sir A. Gridley

I wish to say just a brief word now about the medical services. I think all would agree that these should be expanded and brought within reach of a wider public. The Report ​ makes it clear that the financial cost of such services is not yet calculable until a scheme has been worked out, which must take a considerable time. In my view there must be an extension of State and municipal control, but would it not be unfortunate if there was not some room left for private practice and for at least a proportion of the voluntary hospitals? These are matters which perhaps one can leave to be debated later, when the proposals for the medical services have been worked out. A decision will then have to be taken with regard to the retention or otherwise of the approved and friendly societies. One knows that there are flaws in the administration of those societies which ought to be removed, bat there are the strongest arguments for their retention under proper safeguards and improved methods, and I say without any hesitation that many millions of their members would profoundly regret and resent any disturbance of societies with which they have so long been honourably and satisfactorily associated.

I am going to face the question of cost, because I think no one would be so foolish as to deny that it is the duty of all of us to consider the cost of the Beveridge proposals, in conjunction with all other items of national expenditure which we shall have to face in the immediate post-war period. Moreover, I think it would be the duty of this House, under the guidance of the Government, to decide upon the priority of the items of expenditure which will have to be provided for, say, in the 1945 Budget. What shall we have to provide for? We cannot, if we are sensible, close our eyes to these facts:

There will be the maintenance of the Fighting Services, stronger than those of pre-war, there will be war and civil pensions to meet, the servicing of the National Debt, grants to overrun countries and our own temporarily lost Colonies, the refunding of Income Tax Certificates, the interest on National Savings Certificates, the rebuilding of our bombed areas, housing, education, Colonial development, and other expenditure on roads and transport, police, civil aviation and the rest of it. On top of all this must be added such of the Beveridge proposals as this House may decide to implement.

What does all this mean? I tried to get from the Chancellor of the Exchequer last week an estimate of the probable total of the first post-war Budget expenditure, but he said that until certain major questions of policy were settled it was impossible to provide such an estimate. I am going to do my best to provide it, and I find that if you take the 1937–38 Budget, which includes £147,000,000 for what I may describe as the Beveridge services, we had then to provide £863,000,000. In 1945^6, estimating that to be the first post-war year, I estimate the probable Budget expenditure at over £2,100,000,000, without including anything in respect of grants to overrun countries and Colonies, or the rebuilding of our bombed areas, or the interest on National Savings Certificates, all of which I am quite unable to estimate.

Mr. Loftus (Lowestoft)

Does the hon. Member include anything for the pegging of prices, which must continue for some years after the war?

Sir A. Gridley

No, Sir, that is an uncertain factor; I think it is one of the major problems that the Government will have to tackle. Supposing I am £200,000,000 out and it is £1,900,000,000. Shades of the Grand Old Man, Gladstone! One could almost hear his bones rattling in the grave at this country having to face a Budget of such taxation.

Mr. David Grenfell (Gower)

Does the hon. Member realise that the national income now is greater than his estimate of Government expenditure, and that the national income to-day is four times as high as it was in the Grand Old Man’s time?

Sir A. Gridley

I agree. The circumstances to-day are quite different from what they were then. But if I were the present Chancellor, I think my teeth would chatter at the prospect of having to find all that money from taxation. We have to remember that, on the other side of the balance-sheet, there are certain things we have lost—our former income from overseas investment, shipping, and banking, which in 1938 brought us in £332,000,000, and helped us to balance exports and imports, with an adverse margin of only £55,000,000. Who can foresee how long it will take us to recover that loss? A Budget of £2,000,000,000 would involve, on the present method of ​ taxation, an Income Tax rate, if half of the amount were raised by Income Tax, of 15s. in the £. This would mean raising another £1,000,000,000 by indirect taxation. That is nearly twice the sum which was raised by Excise in 1937–38. We have to ask ourselves whether the country can afford such a tremendous burden of taxation. If we decide that it cannot, we must prune the expenditure and decide what items must be deferred for the time being.

Sir Francis Fremantle (St. Albans)

Does the hon. Member take into account the increased productivity that is expected to arise from the providing of these different services, especially rehabilitation and the health services of the country?

Sir A. Gridley

Yes, Sir; as an employer I attach the greatest value to them.

Sir F. Fremantle

Do you take them into account in your estimate?

Sir A. Gridley

The next sentence which I intended to speak would have covered that point. What I have just said does not by any means lead to the conclusion that gradually, over a period of years, the country would not be able to afford the full implementation of all the Beveridge proposals. Before the last war our social expenditure was something of the order of £25,000,000 a year. It rose in the 20-odd years to nearly £500,000,000, showing what, with improved prosperity, we could afford. I am not without hope that if we can achieve a correspondingly improved prosperity in the next 20 years, the task set us in the Beveridge Report will not be by any means impossible. What is abundantly clear—and one must have the courage to say so—is that the whole of the proposals cannot be implemented at one bound. The Mover of the Motion himself made a strong point of the necessity of going forward with this scheme by instalments. With that, I think, we all agree. None of us need lack the courage to tell our constituents what the nation can and cannot afford. When national bankruptcy threatened us in 1931, our then leaders asked for a doctor’s mandate and for the power to cut salaries and wages, unemployment assistance, and the like. What was the response of the people of this country? They voted solidly for those cuts. Let us remember that.

​ May I remind the House what the Minister without Portfolio said on 1st December last?

“We must survey his”—

Sir William Beveridge’s—

“work, not in isolation, but as a part of our reconstruction work as a whole. He covers a vast field, he proposes sweeping changes, and it would be foolish to suppose that the Government can here and now make any pronouncement of their views on these matters. We propose to read and consider the proposals before we make a statement about them, and Members in all quarters of the House would be well advised to follow that example, to spend time in studying what lie says and to consider these proposals in relation alike to finance, to industry, and to the maintenance of international security as well as to our social services generally.”—[OFFICIAL REPORT, 1st December, 1942; col. 1077, Vol. 385.]

I come to what I hope is the practical portion of my speech. How far is it possible for common agreement to be reached on the Beveridge proposals at this early stage in their consideration? I suggest that a large measure of agreement can be reached on the following: First, that it is right that a new Ministry of Social Insurance should be set up, to centralise the administration of the social services, though one would hope that this would not mean new buildings in every city, town, and urban district; secondly, that there should be separate funds for each benefit we may decide to make statutory; thirdly, that national health insurance should be extended; fourthly, that maternity and marriage grants should be approved without delay; fifthly, that there should be a removal of restrictions limiting the output of production; sixthly, that there must be effective safeguards against malingering; seventhly, that all should contribute to and be eligible for old age pensions. If in so far as I have gone we can reach common agreement, we shall have taken a great step forward. There will remain a great many problems which will require solution.

Mr. Mander (Wolverhampton, East)

Does my hon. Friend in putting forward those specific suggestions definitely exclude children’s allowances?

Sir A. Gridley

I wish I would not be interrupted, because I think the hon. Member will find the ground covered in the very few minutes for which I propose to ask the attention of the House. ​ First, it is Parliament’s duty to consider what are the total post-war obligations that the State must face, and decide on their order of priority, within the capacity of the State to meet them. In this connection—and this answers the point of my hon. Friend—we should consider whether children’s allowances should not be the first of the major Beveridge proposals to be implemented, the whole cost of which must fall on the State. I am merely expressing my personal views, committing no body of friends and no party. The great value of this Debate should be that we are free to express our own views, irrespective of ties of any kind. I certainly am in favour of children’s allowances being one of the first of the proposals to be implemented.

Secondly, how are we effectively to control the cost of living?

Thirdly, should the taxpayer’s contributions be a percentage of the employer’s and employee’s contributions—in other words, is the liability of the State to be fixed, or is it to be unlimited? There is a great deal to be said for fixing it. Also, what should be the actual cash benefits? That is a matter to be hammered out.

Fourthly, who should be included for unemployment benefit? I sometimes wonder whether hon. Members realise how many hundreds of thousands of people there are in the country to whom unemployment is practically unknown. They include Civil Services, municipal services, public utility undertakings, the railways, the standing Fighting Forces, the police, many undertakings such as fanning, tobacco manufacture, the co-operative societies, and the clerical staffs of many industrial undertakings. These must total up to many millions, and they get pensions on retiring. Should such people as these be compelled to contribute to Unemployment Insurance, which they may never require?

Fifthly, should there be a national scheme of pooled benefits for workmen’s compensation? That has to be hammered out.

Sixthly, should old age pensions be conditional on retirement, and should schemes of insurance by employers for their workpeople be encouraged, and the national Exchequer thus relieved? I have always been quietly proud of the fact that 98 per cent. of the staff and the employees ​ in the undertakings with which I am connected are already insured. They are insured for benefits on retirement, and a capital sum is payable for the benefit of their relatives in the event of their death. I should view with the greatest apprehension having to give up schemes of that kind, and I do not think it would be to the benefit of the State that they should be discouraged.

Seventhly, should not funeral and death benefit be left as they are? There are 100,000,000 policies of this kind to-day. Why should that state of things be disturbed?

Eighthly, is there any justification for setting up an Industrial Insurance Board? I doubt it very much, but we may be convinced later that it cannot be avoided.

Ninthly, should all be eligible for health insurance benefits, or only those below a certain income limit? That is a big question about which views may differ. My own view is that a limit should be fixed at about £600 or £700 a year, and that below that figure people should be entitled to these benefits, but that above it they must go to their own doctors and pay for treatment. Finally, to what extent is it likely that international co-operation can be secured? All these are major problems for careful consideration. I ventured to tabulate them because I thought they might be of some use to Ministers who have to reply, and perhaps to some of my hon. Friends who have to make up their minds on these problems.

Finally, may I say this? I find myself in agreement with the main principles underlying the Beveridge proposals, subject to adequate—and they must be adequate—safeguards against abuse and over-organisation. The whole plan hangs upon our industrial prosperity and constant good employment. If prosperity is not achieved, the whole plan is bound to crash. There is no gainsaying the fact that we shall be an impoverished nation at the end of this war, and it will be vital to create employment, and to work hard and efficiently if we are to maintain even the present standards of living. The State undoubtedly has its part to play in clearing away the obstacles which hamper industrial planning for the maximum production. I entirely agree with what the Mover of the Motion said about maximum production in industry, and about not contracting merely to meet the demand. Let the State move the obstacles out of the way of our planning for maximum production, and then it will be our responsibility, those of us who are industrialists, to plan so that we can secure for our people the maximum employment. The well-being of all of us is involved in all these problems, and surely, if ever there was a time when we should approach them in no party spirit, it is now. We all want to make this world a better one, free from the fears of aggression, and with the doors wide open for everyone to pursue his or her life’s work in peace and free from the fear of want.

I conclude by making this appeal to my hon. and right hon. Friends in all parts of the House, and I do it with great respect: Let us give and take. Let us conduct our discussions on these proposals on a high plane as a Council of State, and if we can go forward in that spirit of co-operation, I am convinced, myself, that we can face, however formidable they are, the post-war problems and meet them with success.