justification for the special treatment which we propose for these
trades, and a means of marking them off more or less definitely from
the ordinary trades. In the case of any great staple trade in this
country, if the rate of wages became unnaturally low compared to other
industries, and the workers could not raise it by any pressure on
their part, the new generation at any rate would exercise a preference
for better pay and more attractive forms of industry. The gradual
correction of depressed conditions over large periods of time is thus
possible. But in these sweated industries there is no new generation
to come to the rescue. They are recruited from a class rather than
from a section of the community. The widow, the women folk of the
poorest type of labourer, the broken, the weak, the struggling, the
diseased--those are the people who largely depend upon these trades,
and they have not the same mobility of choice, exerted, tardily though
it be, by a new generation, but which is undoubtedly operative upon
the great staple trades of the country. That is an explanation which
accounts for the same evils being reproduced under similar conditions
in different countries, separated widely from one another and marked
by great differences of general conditions.
I ask the House to regard these industries as sick and diseased
industries. I ask Parliament to deal with them exactly in the same
mood and temper as we should deal with sick people. It would be cruel
to prescribe the same law for the sick as for the sound. It would be
absurd to apply to the healthy the restrictions required for the sick.
Further, these sweated trades are not inanimate abstractions. They are
living, almost sentient, things. Let the House think of these sweated
trades as patients in a hospital ward. Each case must be studied and
treated entirely by itself. No general rule can be applied. There is
no regulation dose which will cure them all. You cannot effect quicker
cures by giving larger doses. Different medicines, different diets,
different operations are required for each; and consideration,
encouragement, nursing, personal effort are necessary for all. Great
flexibility and variety of procedure, and a wide discretionary power,
entrusted to earnest and competent people, must characterise any
attempt to legislate on this subject.
The central principle of this Bill is the establishment of Trade
Boards, which will be charged with the duty of fixing a minimum wage.
I am very anxious to give these Trade Boards the utmost possible
substance and recognition. They will be formed on the principle of
equality of representation for employers and employed, with a skilled
official chairman or nucleus. That is the principle I have adopted in
the new Arbitration Court recently established. That is the principle
which will govern the system of Labour Exchanges, shortly to be
introduced, and other measures which may come to be associated with
Labour Exchanges, and I think it is an excellent principle.
At the same time, do not let us suppose that these Trade Boards will,
in the first instance, be very strong or representative bodies. They
are to be formed in trades mainly worked by women, where no
organisation has ever yet taken root, where there are as yet no means
of finding and focusing an effective trade opinion. Where possible,
they will be partly elective; in many cases they will, I expect, have
to begin by being almost entirely nominated. In some cases it will be
upon the official members alone that the main burden will fall. I
could not ask the House to confer upon bodies of this nebulous
character, not representative, not elective in any democratic sense,
responsible not to constituents, nor to a public department, nor to
Parliament itself in any way, the absolute and final power of
enforcing by the whole apparatus of the law any decision, whether wise
or foolish, upon wage questions to which they may come by the
narrowest majority. The work which we entrust to them wholly and
finally is sufficiently difficult and important. We direct them by
this Bill to prescribe minimum rates of wages. They are to find the
minimum rate. For that purpose they are as well qualified as any body
that we could devise. In this sphere their jurisdiction will be
complete. The Board of Trade will not retry the question of what is
the right minimum rate. Another and quite different question will be
decided by the Board of Trade. They will decide whether the minimum
rate which has been prescribed by the Trade Board commands sufficient
support in the trade to make its enforcement by inspection and
prosecution likely to be effective.
That is the division between the responsibility which the Trade Boards
will have and the responsibility which we shall reserve to ourselves.
I shall be quite ready in Committee to express that intention, which
is in the Bill, in a simpler and stronger manner, and to make the
function of the Board of Trade a positive and not a negative one, so
that when the Trade Board has fixed the minimum rate of wages it
shall, after an interval of six months, acquire the force of law, and
shall be enforced by compulsory powers, unless in the meanwhile the
Board of Trade decides or rules otherwise. For my part, I gladly give
an assurance that it is our intention to put the compulsory provisions
of this Bill into full effect upon at least one of the trades in the
schedule, at as early a date as possible, in order to bring about the
fulfilment of a much-needed and long-overdue experiment.
Now I come to the probationary period, and I know that there are a
great many who have stated that it is mere waste of time. I, on the
contrary, have been led to the opinion that it is vital to any
practical or effective policy against sweating. It is no use to
attempt, in trades as complex and obscure as these with which we are
dealing, to substitute outside authority for trade opinion. The only
hope lies in the judicious combination of the two, each acting and
reacting upon the other. A mere increase of the penal provisions and
inspection would be a poor compensation for the active support of a
powerful section within the trade itself. It is upon the probationary
period that we rely to enable us to rally to the Trade Board and to
its minimum wage the best employers in the trade. In most instances
the best employers in the trade are already paying wages equal or
superior to the probable minimum which the Trade Board will establish.
The inquiries which I have set on foot in the various trades scheduled
have brought to me most satisfactory assurances from nearly all the
employers to whom my investigators have addressed themselves.
For the enforcement of this Act, and for the prevention of evasion and
collusion, I rely upon the factory inspectors, who will report
anything that has come to their notice on their rounds and who will
make themselves a channel for complaints. I rely still more upon the
special peripatetic inspectors and investigators who will be appointed
under the Act by the Board of Trade, who will have to conduct
prosecutions under the Act, and who will devote all their time to the
purposes of the Act. These officers will incidentally clothe the Trade
Boards with real authority, once the rate has been enforced, in that
they will be responsible to the Trade Board, and not to some powerful
Department of Government external to the Trade Board itself. I rely
further upon the support of the members of the Trade Boards
themselves, who will act as watch-dogs and propagandists. I rely upon
the driving power of publicity and of public opinion. But most of all
I put my faith in the practical effect of a powerful band of
employers, perhaps a majority, who, whether from high motives or
self-interest, or from a combination of the two--they are not
necessarily incompatible ideas--will form a vigilant and instructed
police, knowing every turn and twist of the trade, and who will labour
constantly to protect themselves from being undercut by the illegal
competition of unscrupulous rivals.
An investigator in the East End of London writes:
"The people who can check evasion are the large firms. Their
travellers form a magnificent body of inspectors, who ought to see
that the Act is enforced. The checking of evasion will have to be
carried out, not so much by visiting workshops and home-workers as by
hearing where cheap, low-class goods are coming into the market, and
tracing the goods back to the contractors who made them."
There are solid reasons on which we on this side of the House who are
Free Traders rely with confidence, when we associate ourselves with
this class of legislation. First of all, we must not imagine that this
is the only European country which has taken steps to deal with
sweating. The first exhibition of sweated products was held in Berlin,
and it was from that exhibition that the idea was obtained of holding
that most valuable series of exhibitions throughout this country
which created the driving power which renders this Bill possible. I am
advised that German legislation on some of these questions has even
anticipated us. In other countries legislation is pending on
principles not dissimilar from those which we advocate. In Bavaria and
Baden the latest reports are to the effect that the official
Government Reports of Inquiries recommend almost the same and in some
cases stronger provisions than those to which we now ask the assent of
the House of Commons. This may be said in a different form of Austria.
All this movement which is going on throughout Europe, and which is so
pregnant with good, will be powerfully stimulated by our action in
this country, and that stimulus will not only facilitate our work by
removing the argument which causes hon. gentlemen opposite anxiety,
but it will also, I think, redound to the credit of this country that
it took a leading and prominent position in what is a noble and
benignant work.
I was delighted to hear the Leader of the Opposition say, in a concise
and cogent sentence, that he could easily conceive many sweated trades
in which the wages of the workers could be substantially raised
without any other change except a diminution of price. Sir, the wages
of a sweated worker bear no accurate relation to the ultimate price.
Sometimes they vary in the same places for the same work done at the
same time. And sometimes the worst sweating forms a part of the
production of articles of luxury sold at the very highest price. We
believe further, however, that decent conditions make for industrial
efficiency and increase rather than diminish competitive power.
"General low wages," said Mill, "never caused any country to undersell
its rivals; nor did general high wages ever hinder it." The employers
who now pay the best wages in these sweated trades maintain themselves
not only against the comparatively small element of foreign
competition in these trades, but against what is a far more formidable
competition for this purpose--the competition of those employers who
habitually undercut them by the worst processes of sweating. I cannot
believe that the process of raising the degenerate and parasitical
portion of these trades up to the level of the most efficient branches
of the trade, if it is conducted by those conversant with the
conditions of the trade and interested in it, will necessarily result
in an increase of the price of the ultimate product. It may, even as
the right hon. gentleman has said, sensibly diminish it through better
methods.
Sir, it is on these grounds, and within these limits, that I ask for a
Second Reading for this Bill.
The principles and objects are scarcely disputed here. Let us go into
Committee and set to work upon the details, actuated by a
single-minded desire to produce a practical result. It is by the
evidences of successful experiment that, more than any other way, we
shall forward and extend the area of our operations; and in passing
this Bill the House will not only deal manfully with a grave and
piteous social evil, but it will also take another step along that
path of social organisation into which we have boldly entered, and
upon which the Parliaments of this generation, whatever their
complexion, will have to march.
FOOTNOTES:
[14] Otherwise called "The Trade Boards Bill."
LABOUR EXCHANGES AND UNEMPLOYMENT INSURANCE
HOUSE OF COMMONS, _May 19, 1909_
The functions of Government in relation to industrial life may be
divided into three categories--discipline, organisation, and relief.
The control and regulation of industrial conditions by penal and
disciplinary powers belong to the Home Office, the relieving and
curative processes are entrusted to the Local Government Board, and
the organisation of industry falls to the province of the Board of
Trade. The proposals which I now submit to the House are concerned
only with organisation; they can be judged only in relation to that
section of the subject; they do not pretend to stretch beyond it, or
to include other not less important aspects; and I ask that they shall
not be impugned, because, in dealing with the evils which properly
fall within that sphere, they do not extend to other evils that lie
without it.
I ask permission to introduce a Bill for the establishment of a
national system of Labour Exchanges. There is high authority for this
proposal. The Majority and Minority representatives of the Poor Law
Commission, differing in so much else, are agreed unanimously in its
support. "In the forefront of our proposals," says the Majority
Report, "we place Labour Exchanges." "This National Labour Exchange,"
says the Minority Report, "though in itself no adequate remedy, is the
foundation of all our proposals. It is, in our view, an indispensable
condition of any real reform." The National Conference of Trade Union
Delegates, convened by the Parliamentary Committee of the Trade Union
Congress, of March 19, 1909, resolved unanimously: "That this
Conference of Trade Union delegates, representing 1,400,000 members,
approves of the establishment of Labour Exchanges on a national basis,
under the control of the Board of Trade, provided that the managing
board contains at least an equal proportion of employers and
representatives of Trade Unions." The Central Unemployed Body for
London, by a Resolution in June 1908, declared in favour of a national
system of Labour Exchanges. Economists as divergent in opinion as
Professor Ashley, of Birmingham, and Professor Chapman, of Manchester,
have all approved and urged the project publicly in the strongest
terms. Several of the principal members of the late Government have,
either in evidence before the Poor Law Commission or in public
speeches, expressed themselves in favour of Labour Exchanges, and the
Report of the delegates of the Labour Party to Germany strongly
approves of the system which they found there, namely: "the
co-ordination and systematic management of Public Labour Exchanges."
The British authorities which I have mentioned are reinforced by the
example of many foreign countries; and as early as 1904 the Board of
Trade, in its reports on agencies and methods of dealing with
unemployed in foreign countries, drew attention to the very
considerable extension of Labour Exchanges in the last three years in
Germany, Austria, Switzerland, France, and Belgium. Since then Norway
has been added to the list. Mr. W. Bliss, in the Bulletin of the
_Washington Bureau of Labour_ for May, 1908, in the course of a survey
of the whole field of unemployment and of possible remedies, says,
"The most important agencies for providing work for the unemployed
who are employable, but have no prospect of returning to their former
positions, are the public employment bureaux. These are largely
developed in a number of European countries, and especially in
Germany, where they have grown rapidly in the last twenty years, both
in numbers and in efficiency." So that the House will see that we have
behind us this afternoon not only a practical consensus of opinion
among authorities at home in favour of the policy, but the spectacle
of its successful practice on an extensive scale, and over a period of
years, in the greatest industrial community of the Continent, and its
extension in various degrees to many other countries.
I do not, therefore, propose to occupy the time of the House with any
elaborate justification of the merits of the Bill. Those we may
discuss at our leisure later. I confine myself only to a few general
observations. Two main defects in modern industrial conditions which
were emphasised by the Royal Commission were the lack of mobility of
labour and lack of information. With both of these defects the
National System of Labour Exchanges is calculated to deal. Modern
industry has become national. Fresh means of transport knit the
country into one, as it was never knit before. Labour alone in its
search for markets has not profited; the antiquated, wasteful, and
demoralising method of personal application--that is to say, the
hawking of labour--persists. Labour Exchanges will give labour for the
first time a modernised market. Labour Exchanges, in the second place,
will increase and will organise the mobility of labour. But let me
point out that to increase the _mobility_ of labour is not necessarily
to increase the _movement_ of labour. Labour Exchanges will not
increase the movement of labour; they will only render that movement,
when it has become necessary, more easy, more smooth, more painless,
and less wasteful.
Labour Exchanges do not pretend to any large extent to create new
employment. Their main function will be to organise the existing
employment, and by organising the existing employment to reduce the
friction and wastage, resulting from changes in employment and the
movement of workers, to a minimum. By so doing they will necessarily
raise the general economic standard of our industrial life.
So far as the second defect, "lack of information," is concerned, a
system of Labour Exchanges promises to be of the highest value. In
proportion as they are used, they will give absolutely contemporary
information upon the tendencies of the demand for labour, both in
quality and in quantity, as between one trade and another, as between
one season and another, as between one cycle and another, and as
between one part of the country and another. They will tell the worker
where to go for employment. They will tell him, what is scarcely less
important, where it is useless to go in search of employment. Properly
co-ordinated and connected with the employment bureaux of the various
education authorities, which are now coming into existence in Scotland
and in England, they will afford an increasing means of guiding the
new generation into suitable, promising, and permanent employment, and
will divert them from overstocked or declining industries. They will
put an end to that portion of unemployment that is merely local or
accidental in character. They are the only means of grappling with the
evils of casual employment, with all its demoralising consequences.
They are capable of aiding the process of dovetailing one seasonal
trade into another. A system of Labour Exchanges, dispensing with the
need for wandering in search of work, will make it possible, for the
first time, to deal stringently with vagrancy. And, lastly, Labour
Exchanges are indispensable to any system of Unemployment Insurance,
as indeed to any other type of honourable assistance to the
unemployed, since they alone can provide an adequate test of the
desire for work and of the reality of unemployment. The authority of
both Reports of the Poor Law Commission may be cited upon these
points; and I shall present this Bill to the House as an important
piece of social and industrial machinery, the need for which has long
been apparent, and the want of which has been widely and painfully
felt.
I said that in the creation of such a system we may profit by the
example of Germany; we may do more, we may improve upon the example of
Germany. The German Exchanges, though co-ordinated and encouraged to
some extent by State and Imperial Governments, are mainly municipal in
their scope. Starting here with practically a clear field and with
the advantage of the experiment and the experience of other lands to
guide us, we may begin upon a higher level and upon a larger scale.
There is reason to believe that the utility of a system like Labour
Exchanges, like utility of any other market, increases in proportion
to its range and scope. We therefore propose, as a first principle,
that our system shall be uniform and national in its character; and
here, again, we are supported both by the Minority and by the Majority
Reports of the Royal Commission.
A Departmental Committee at the Board of Trade has, during the last
six months, been working out the scheme in close detail. The whole
country will be divided into ten or twelve principal divisions, each
with a Divisional Clearing House, and each under a Divisional Chief,
all co-ordinated with the National Clearing House in London.
Distributed among these 10 Divisions in towns of, let us say, 100,000
or upwards will be between 30 and 40 First-class Labour Exchanges; in
towns of 50,000 to 100,000 between 40 and 50 Second-class Exchanges;
and about 150 minor offices, consisting of Third-class Exchanges,
Sub-Offices, and Waiting-rooms, which last will be specially used in
connection with Dock decasualisation.
The control and direction of the whole system will be under the Board
of Trade. But in order to secure absolute impartiality as between the
interests of capital and labour, Joint Advisory Committees, to contain
in equal numbers representatives of employers and work-people, will be
established in the principal centres. Thus we shall apply to the local
management of Labour Exchanges the same principle of parity of
representation between workmen and employers under impartial guidance
and chairmanship, that we have adopted in the administration of the
Trade Boards Bill, and that, _mutatis mutandis_, is the governing
feature of the Courts of Arbitration which have recently been set up.
If this Bill should obtain the assent of Parliament without undue
delay, I should hope to bring the system into simultaneous operation
over the whole country, so far as practicable, in the early months of
next year. Temporary premises will be procured in all cases in the
first instance; but a programme of building has been prepared, which
in ten years will by a gradual process enable in all the principal
centres these temporary premises to be replaced by permanent
buildings.
The expense of this system will no doubt be considerable. Its ordinary
working will not need a sum less than about L170,000 per year, and
during the period when the building is going on the expenditure will
rise to about L200,000 per year.