Grants were made at the rate of 5s. per week for a wife and 1s. a week for each dependent child.
Temporary Act of April, 1922
Yet still further emergency legislation has been necessary to meet the continuance of unemployment. On March 13, 1922, there were in Great Britain 1,690,000 insured persons registered as wholly unemployed and 225,000 as on short-time. Of these, large numbers began to run out of benefit on April 5, the date at which expired the six weeks’ extension of benefit under the Act of July, 1921, each subsequent week adding to this number. On July 2, 1922, the whole of the emergency or “uncovenanted” benefit provided by the Temporary Act of March, 1921, would have wholly expired. In addition, on May 9, 1922, the Unemployed Workers’ Dependents (Temporary Provision) Act, 1921, came to an end. The Government accordingly passed the Unemployment Insurance Act, 1922, which came into operation on April 6, 1922. The effect of its complicated provisions can be shortly summarized. It terminated the second special period under the Act of March, 1921, at April 5, 1922, instead of July 2, 1922, as by that Act provided. It then prescribed a third special period and a fourth special period, the third from April 6, 1922, to November 1, 1922, the fourth from November 2, 1922, to July 1, 1923. During the third special period, insured persons no longer entitled to benefit under the permanent insurance scheme will be allowed to receive “uncovenanted” benefit for an aggregate of fifteen weeks, increased to twenty-two weeks by the Unemployment Insurance (No. 2) Act, 1922—passed July 20, 1922. As this fifteen weeks’ benefit had to cover thirty calendar weeks, it was divided up into three periods of benefit with a gap between each of five weeks, reduced to one week by the Act of July 20, 1922. During the fourth special period, twelve weeks’ benefit will be paid, with two possible further extensions of five weeks each. The insurance benefit remains, under the Act of April, 1922, at the same level as before, namely 15s. per week for the men and 12s. for the women, with the additional benefit provided by the Dependents’ Act of November, 1921, 5s. per week for the wife, and 1s. per week for each child. The rates of contributions by employed persons, employers and the State are the totals of the contributions under the Act of July, 1921, and the Dependents’ Act of November, 1921, and are, therefore, as follows:
| Employer’s Share. | Employee’s Share. | State Contribution. | |
|---|---|---|---|
| Men | 10d. | 9d. | 6¾d. |
| Women | 8d. | 7d. | 5¼d. |
| Boys under 18 | 5d. | 4½d. | 3⅞d. |
| Girls | 4½d. | 4d. | 3⅝d. |
These will be the contributions until the end of the deficiency period as defined in Section 16 of the Act of July, 1921.
From June 1921, to March 1922, the Unemployment Insurance Scheme was continuously carrying an average of 1¾ million persons, and 53½ million pounds of benefit were distributed; the Government’s estimate is 1½ million persons wholly unemployed from April 1922, to June 1923. These figures will involve the payment of sixty million sterling in benefit for those fifteen months; of this amount the State will ultimately contribute one-quarter of the whole as against one-fifth under the permanent scheme of the Act of 1920, and the liability of the State will continue at the higher figure until the end of the emergency period. For the financial year 1922-23, the estimates provided for £12,196,130 as the State’s contribution to the Insurance Fund and £551,760 to the Dependents’ Fund, making a total of £12,747,890. In April fourteen millions of the twenty million borrowing powers conferred on the Minister of Labour by the Act of July, 1921, were exhausted, and it was estimated that the whole twenty millions would be exhausted by July 1922. The Act of April, 1922, therefore increased the borrowing powers of the Minister from twenty millions to thirty millions sterling.
The Efficiency of the State Scheme
This was investigated by the Committee on National Expenditure (see First Report Parliamentary Paper, 1922, Cmd. 1581, p. 144). They recommended, and properly so, that the question should be carefully explored of placing unemployment insurance on the basis of insurance by industry. They also urged an investigation by a committee of experts of the administration of the State scheme with a view to its improvement. Very considerable simplification and improvement would appear to be possible judging from the report of Sir Alfred Watson, the distinguished Government Actuary. The cost to the taxpayer of Unemployment Insurance and Employment Exchanges since 1912-13 is stated in the Report of the Committee on National Expenditure to be as follows:
| Administrative cost (gross). | Appropriation from Unemployment Fund. | Net Charge to Exchequer on account of Administration. | Government Contribution to Fund. | Total Charge to Votes. | |
|---|---|---|---|---|---|
| £ | £ | £ | £ | £ | |
| 1912/13 | 640,000 | 151,000 | 489,000 | 378,000 | 867,000 |
| 1913/14 | 769,000 | 246,000 | 523,000 | 602,000 | 1,125,000 |
| 1914/15 | 764,000 | 227,000 | 537,000 | 546,000 | 1,083,000 |
| 1915/16 | 834,000 | 231,000 | 603,000 | 538,000 | 1,141,000 |
| 1916/17 | 905,000 | 329,000 | 576,000 | 746,000 | 1,322,000 |
| 1917/18 | 1,168,000 | 445,000 | 723,000 | 1,007,000 | 1,730,000 |
| 1918/19 | 1,950,000 | 455,000 | 1,495,000 | 994,000 | 2,489,000 |
| 1919/20 | 3,613,000 | 459,000 | 3,154,000 | 912,000 | 4,066,000 |
| 1920/21 | 4,593,000 | 1,115,000 | 3,478,000 | 2,200,000 | 5,678,000 |
| 1921/22 | 6,039,000 | 3,250,000 | 2,789,000 | 6,720,000 | 9,509,000 |
| 1922/23 | 5,020,000 | 4,150,000 | 870,000 | 8,231,000 | 9,101,000 |
The above figures do not include the cost of the Unemployed Workers’ Dependents Act, which is financed independently of the Unemployment Fund and which imposes on the Vote charges of £2,192,000 in 1921/22 and £670,000 in 1922/23.