THE ADMINISTRATION OF WELFARE
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A8 Old Age Pensions Contributory or Non-contributory, 1908
Mr Lloyd-George The first general criticism is that this is a noncontributory scheme. So long as you have taxes imposed upon commodities which are consumed practically by every family in the country there is no such thing as a non-contributory scheme. A workman who has contributed health and strength, vigour and skill, to the creation of the wealth by which taxation is borne has made his contribution already to the fund which is to give him a pension when he is no longer fit to create that wealth. Therefore, I object altogether to the general division of these schemes into contributory and non-contributory schemes. There is, however, a class of scheme which is known as a contributory one. There is the German scheme, in which the workmen pay into a fund. It is rather a remarkable fact that most social reformers who have taken up this question have at first favoured contributory schemes, but a closer examination has almost invariably led them to abandon them on the ground that they are unequal in their treatment of the working classes, cumbersome, and very expensive, and in a country like ours hopelessly impracticable. Let me give now two or three considerations why, in my judgment, a contributory scheme is impossible in this country. In the first place, it would practically exclude women from its benefits. Out of the millions of members of friendly societies there is but a small proportion, comparatively, of women. Another consideration is that the vast majority are not earning anything and cannot pay their contributions. The second reason is that the majority of working men are unable to deflect from their weekly earnings a sufficient sum of money to make adequate provision for old age in addition to that which they are now making for sickness, infirmity, and unemployment. I do not know what the average weekly wage in this country is; we have not had a wages census since 1886…The average weekly wage in 1886 was 24s. 9d., and 57 per cent, of the working classes in this country were then earning 25s. or less. It is quite clear, therefore, that out of such wages they cannot make provision for sickness, for all the accidents and expenses of life, and also set aside a sufficient sum to provide a competence for old age as well…
I find that some of the friendly societies which have superannuation benefits demand that if you fail in your subscriptions you either make it up afterwards, sometimes with interest, or you forfeit your benefit altogether. Now it is obviously impossible that that could be done with the great majority of workmen. The friendly societies of this country have a membership of about 12,000,000. So far from the number being over 12,000,000 it would very likely be under, because a good many members of trade unions are also members of benefit societies. It is very gratifying that such a large number of workmen should have the prudence, foresight, and restraint to enable them to set aside out of earnings money which they might have spent on necessaries or the comforts of the moment. I point that out for this reason, that the House may depend upon it that, if it were within the compass of the means of the working classes to make provision for old age, the fact that they had provided for sickness, that a good many have provided against unemployment and accidents of that kind, would in itself be a proof that they would have provided superannuation for old age if they could have done it. Besides that, I do not think the State has a right to invite the workman earning from 15s. to 20s. or 25s. a week to make the sacrifice which is necessary-the sacrifice, really, of some of the absolute necessaries of life as far as he and his children are concerned, in order to make provision for old age, but that the State itself ought to make it.