Change 19.  Transfer to the Ministry of Social Security of the remain­ing functions of Local Authorities in respect of public assistance, other than treatment and services of an institutional character.

161.  The Poor Law, founded originally on the obligation of every parish to prevent destitution, was, until comparatively recently, the basic service for meeting need.  But during the past 40 years there has been a strong trend away from the Poor Law and in favour of contributory State insurance and assistance administered on a national basis.   The proposals in this Report (extending State insurance to new classes and new needs, raising rates of benefit, and prolonging the period of benefit) will considerably reduce the scope both of public assistance and of the Assistance Board.   There can be no case for maintaining two or more large organisations performing precisely the same functions (payment of assistance according to needs) in respect of a reduced and declining number of recipients.    It is therefore proposed that there should be one authority administering assistance on the basis of a uniform means test.

162.  It is essential to the logic and aims of the Plan of Social Security that this authority should be national and part of the Ministry of Social Security. This view was accepted or recommended by the Association of Municipal Corporations, the County Councils Association and the London County Council, that is to say, by all the public assistance authorities in England and Wales.   Representatives of Local Authorities in Scotland, while in general they held that the cost of public assistance should be made a national charge, suggested that in the interests of preserving local knowledge, administra­tion should remain with the Local Authorities and staffs employed by them. The same view was presented by the National Association of Local Government Officers.

163. It is clear that the administration of the Ministry of Social Security must be decentralised, so that its local officers are in intimate touch with the problems and circumstances in their localities. This can be secured without making these officials servants of, and subject to the control of, the Local Authority. The present important function of the Relieving Officer of giving relief in cases of sudden and urgent necessity will, in future, have to be per­formed by the equivalent local officer of the Ministry of Social Security. There is no difficulty in practice in arranging for local administration by local officials of a Central Department. But, to make such officials servants of the Local Authority means either that the Local Authority has discretion in spending money to which it does not contribute in any way and in which, therefore, it has no motive to economise, or that it has no discretion, in which case the Local Authority becomes an agent without responsibility.  It is neither desirable for the strength of local democracy that Local Authorities should have to administer a service without discretion and according to detailed rules nor compatible with a national minimum and a national Plan of Social Security that people should be given assistance  according to a scale  and conditions which vary from place to place.

  1. The abolition of the Poor Law will still leave in the hands of Local Authorities the important and growing task of organising and maintaining institutions of various kinds, for treatment and welfare.    In view of the increasing number of old persons, there is probably considerable scope for experimentation with and development of services concerned with the recrea­tion and welfare of the old, including special housing facilities. The domiciliary Poor Law Medical service will presumably be merged into the comprehensive health service which is Assumption B of the Report, and in which Local Authorities will continue to play a very important part. Local Authorities also will have a vital part to play in the other fields of social welfare, such as housing, education and the recreative and cultural services. But these services will not be provided as part of the Poor Law. The Poor Law Code will, it is proposed, be abolished. The many-sided activities of Local Authorities in relation to social security will be organised either as part of the different main social services under the appropriate Committees for Public Health, Eduudtion and so forth, or under a special Social Welfare Committee concerned with or co-ordinating such cash-aid functions as rent rebates, or cheap or free school meals, to which a single means test would be applied.

165.    The proposal in the Report, in accord with the views expressed by the English Local Authorities, is that responsibility for assistance should be transferred to the Ministry of Social Security while provision for institutions will in general remain with the Local Authorities, who will be empowered to give cash payments which are incidental to institutional treatment. The precise dividing line and the details of the transfer, including the consequential financial adjustments, will have to be worked out in consultation with the Local Authorities.   But one thing is clear:  there will be need for continuous and friendly collaboration between the proposed Ministry of Social Security and the Local Authorities.  Both Central and Local Government have in their different ways a contribution to make to the future security and welfare of the people of this country.

Change 20. Transfer to the Ministry of Social Security of responsibility for the maintenance of blind persons, and the framing of a new scheme for maintenance and welfare by co-operation between the Ministry, Local Authorities and voluntary agencies.

166.  Under the Blind Persons Act, 1920, a complete register of blind persons is made. Help to them takes three main forms:

a)Non-contributory pensions subject to a means test payable as from the age of 40, but otherwise on the same terms as non-contributory old age pensions at 70 and, like them, administered by the Customs and Excise Department.

b)Assistance by Local Authorities under the Blind Persons Act, 1938, including both money grants subject to means test, and provision of workshops, training centres and home teaching.

c)Help by voluntary agencies.

  1. These arrangements are open to two main criticisms. The first is that a plan of treating blind persons as if they were prematurely aged is not in accord with realities.  Blind persons, though they may need some allowance to compensate them for their infirmity, should not get it in a form which assumes that they are past work and discourages earning.    Nor is there any virtue in the age 40 as that at which blind persons are assumed to become the   equivalent of sighted persons of 70.  Second, placing primary responsibility on Local Authorities and local rates for assistance supplementary to the pension leads both to unjustifiable inequalities in the amounts granted according to the different policies of different authorities, and to settlement difficulties, since authorities which could find places for blind persons from other districts in their workshops and training centres may suffer by doing so, through becoming permanently liable for such persons.

  2. The future treatment of the problem of blindness is profoundly affected by the general proposals of this Report.   From this point of view the most important fact in regard to blindness is that it now occurs mainly late in life. At one time one of the most frequent causes of blindness was disease within a few days of birth. Fortunately, the successful campaign against ophthalmia neonatorum is steadily reducing blindness from this cause. The age distribution of the registered blind in Great Britain in 1941 was as follows:

  • Under 5            215          0.3
  • 5-15                1551         1.9
  • 16-39            10389         12.5
  • 40-49              8514        10.2
  • 50-69            32320        38.8
  • 70 and over  30218         36.3

Total                         83207

The great majority of blind persons, therefore, will be contributors either in Class I or in Class II in the years between 16 and onset of blindness. If, therefore, their blindness renders them incapable of work within the general definition of disability, they will be entitled to the appropriate rates of disability benefit and in due course to the appropriate retirement pension.

  1. This does not mean that blindness needs no special consideration apart from general disability. On the contrary, it is a special problem, to be dealt with within the general framework by methods appropriate to the special conditions of the blind. These conditions are:—

i) Blindness is a handicap not only in earning but in all occupations, such as that of a housewife. Even if in most cases this produces no need for cash income, additional to the earnings of the husband, it may do so in some cases.

ii) Blindness is a handicap not only in useful occupation, whether for pay or not, but also in other sides of life. The subsistence needs of a totally incapacitated blind person may be more than those attached to many other, though not to all other, forms of disability.

iii) Blindness may not prevent earning wholly and should not be treated on the assumption that it means total loss of earning power. Some kind of provision for partial incapacity is required.

iv) The special provision needed by the blind is not wholly or even in the main a cash provision. The care of the blind is largely a matter of treatment and welfare, and the provision of special institutions.

From this last feature flows, in accordance with the general principles of the Plan for Social Security, the consequence that the special responsibilities now given to Local Authorities in respect of blind persons should to a large extent continue. Some of the Local Authorities who advocated transfer of public-assistance cash payments generally to a national authority took a different line in regard to blindness.

  1. The practical conclusion is that set out at the head of this section, namely, that the Ministry of Social Security should assume general responsi­bility for the blind as for other disabled persons and should prepare a revised scheme for dealing with the problem in consultation with the Local Authorities and voluntary agencies.

Change 21. Transfer to the Ministry of Social Security of the func­tions of the Assistance Board, of the work of the Customs and Excise Department in respect of non-contributory pensions, and probably of the employment service of the Ministry of Labour and National Service, in addition to unemployment insurance, and the work of other Departments in connection with the administration of cash benefits of all kinds including workmen’s compensation.

171.        The precise form of departmental organisation to be adopted for administration of social security cannot be determined finally without reference to the general organisation of the work of the Government. There will clearly, however, be a considerable transfer of functions from other departments to the proposed new Ministry of Social Security.   The following notes deal with the principal changes which seem likely to be required.

172.    Assistance  Board:  There  are  arguments, on the one side, for associating assistance as closely as possible with insurance in administration, and there are arguments, on the other side, for keeping it distinct.  In favour of a close association are (i) the general advantage from the point of view of the citizen of being able to deal with a single agency in place of being sent from one department to another; (ii) the fact that, in the transition period, a large proportion of those in need of assistance will be in that position only because the date of their birth brings them to retiring age before contributory pensions have risen to subsistence level.   There will be others whose need for assistance is equally independent of any kind of default of their own, either trivial or serious. In favour of maintaining a distinction between the adminis­tration of assistance and insurance two arguments also may be advanced: (i) that it is important to make insurance appear to be, as it is in fact, some­ thing different from assistance and better, and that this end will be defeated if the two systems are administered together;  (ii) that the work of administer­ing assistance, which is necessarily to some extent discretionary and involves domiciliary visits, requires a staff different in qualifications and training from the staff for insurance.  On balance, the arguments for making assistance definitely part of the responsibilities of the Ministry of Social Security outweigh the arguments on the other side, and suggest that a separate organisation like the Assistance Board will no longer be appropriate.  In any case, a specialised staff will be needed for assistance.   There must also be special provisions for dealing with those who are in need of assistance through deliberate failure to comply with the conditions of insurance, that is to say, there must be machinery for meeting their needs without condoning their breach of citizen obligations.

173. Customs and Excise Department: The present work of the Customs and Excise Department in the administration of non-contributory pensions must clearly be combined with the administration of assistance pensions, that is to say, on the proposals made above, it will be transferred to the Ministry of Social Security.

174. Employment Service:  The administration of unemployment benefit depends on the test of availability for work which is the function of employment exchanges; payment of unemployment benefit and placing in employment must in practice take place at the same local offices. The question arises whether this necessary combination can be secured best by transferring the registration and placing function of the Ministry of Labour and National Service to the new Ministry of Social Security, or by retaining these functions in the Ministry of Labour and National Service, but housing the staff at the local Security Offices. Probably the former plan will be the more convenient, though either alternative is possible.   In any case the Ministry of Labour and National Service will continue to deal with labour questions generally, including training for which it will provide institutions, post-medical rehabilitation, wages and conditions of employment, disputes, survey of the labour market and welfare in places of employment. The Ministry of Social Security must co-operate closely with the Ministry of Labour and National Service, particu­larly in regard to training and must co-operate also with the department or departments responsible for administration of the Mines and Factory Acts and the prevention of accident and disease.

  1. Other Departmental Transfers: In addition to the transfer of unemployment insurance from the Ministry of Labour and National Service, there will be transfer of health insurance from the Health Departments and of workmen’s compensation from the Home Office. The position of the Registry of Friendly Societies, office of the Industrial Assurance Commissioner, will depend to some extent upon the decision on Change 23 below. It will probably be desirable in any case for the Minister of Social Security to answer for the work of the Registry in Parliament, though it should be noted that this work is concerned also with Trade Unions, and with other types of society not closely associated with problems of social security.

Change 22. Substitution for the Unemployment Insurance Statutory Committee of a Social Insurance Statutory Committee with similar but extended powers.

  1. The Unemployment Insurance Statutory Committee has three main functions in relation to unemployment insurance

a)  Supervision of the finance of the Unemployment Fund, including power to recommend changes of benefit and contribution which can be carried out without legislation, in order to adjust the income and the expendi­ture of the Fund;

(b) Reporting on all Draft Regulations, after giving an opportunity to interested parties to make representations;

(c)  Reporting on any other matters referred to it by the Minister, acting thus as a standing Royal Commission.

The Committee consists of seven members, each holding office for five years, within which he cannot be dismissed; none of the members can belong to the House of Commons; one member at least must be a woman; two are appointed after consultation with organisations of employers and employees and one after consultation with the Government of Northern Ireland. The Committee is independent of the Minister, but has no executive powers. Its function is that of making reports upon which the Minister and Parliament decide.

177.  There will clearly be need for a similar body to give considered, impartial attention to the problems of unified social insurance.   Such a body might well be constructed on the same lines as the Unemployment Insurance Statutory Committee, with or without the special representation of Northern Ireland.   It would give to employers and employees a regular opportunity of making representation as to branches of insurance, other than unemployment insurance, which they do not enjoy at present. But there will be important differences of detail between the functions of the Unemployment Insurance Statutory Committee and those of a similar body for social insurance as a whole.

178.   One difference will be that the Social Insurance Statutory Com­mittee, even if it makes a financial report each year, should not be expected each year to bring the income and expenditure of the Social Insurance Fund into adjustment, or to make some recommendation for change each year. The finance of pensions and sickness is an affair not of a year, but of a lifetime. It is not, in fact, desirable that the unemployment account of the Social Insurance Fund should be kept in balance every year. On the contrary, the Fund, by accumulating reserves in periods of good trade, and spending them or even running into debt on its unemployment account in periods of declining activity, may help to stabilise employment (see para. 442).

179.    Another difference is that the Social Insurance Statutory Committee will have to deal with two problems which do not arise in the narrower scope of unemployment insurance—namely that of keeping benefits and contri­butions in relation to changes in the value of money and that of keeping benefits for different purposes in the right relation to one another, subject to whatever statutory minima are prescribed.

180.  A number of problems of a type suitable for investigation by such a body as the suggested Social Insurance Statutory Committee will arise in the framing of the unified insurance scheme and in  adjusting its details.   It may be found convenient to have the Committee established in advance of the coming into operation of the scheme, so as to get these problems dealt with in good time.

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