17. The main feature of the Plan for Social Security is a scheme of social insurance against interruption and destruction of earning power and for special expenditure arising at birth, marriage or death. The scheme embodies six fundamental principles : flat rate of subsistence benefit ; flat rate of contribution ; unification of administrative responsibility; adequacy of benefit ; comprehensiveness ; and classification. These principles are explained in paras. 303-309. Based on them and in combination with national assistance and voluntary insurance as subsidiary methods, the aim of the Plan for Social Security is to make want under any circumstances unnecessary.
18. A plan which is designed to cover so many varieties of human circumstance must be long and detailed. It must contain proposals of differing orders of certainty and importance. In preparing the Report, the question arose naturally as to how far it was necessary at this stage to enter into details, and whether it might not be preferable to deal with principles only. For two reasons it has appeared desirable, in place of giving an outline only, to set the proposals out in as much detail as the time allowed. The first reason is that the principles underlying any practical reform can be judged only by seeing how they would work in practice. The second reason is that if a Plan for Social Security is to come into operation when the war ends or soon after, there is no time to lose in getting the plan prepared as fully as possible. The many details set forth in Part V are neither exhaustive nor final; they are put forward as a basis of discussion, but their formulation will, it is hoped, shorten subsequent discussion. Even among the major proposals of the Report there are differences of importance and of relevance to the scheme as a whole. There are some proposals which, though important and desirable in themselves, could be omitted without changing anything else in the scheme. Three in particular in the list of major changes in para. 30 have this character and are placed in square brackets to indicate it. This does not mean that everything not bracketed is essential and must be taken or left as a whole. The six principles named above and all that is implied in them are fundamental ; the rest of the scheme can be adjusted without changing its character: all rates of benefit and all details are by nature subject to amendment.
19. The main provisions of the plan may be summarised as follows:
(i) The plan covers all citizens without upper income limit, but has regard to their different ways of life ; it is a plan all-embracing in scope of persons and of needs, but is classified in application.
(ii) In relation to social security the population falls into four main classes of working age and two others below and above working age respectively, as follows:
- Employees, that is, persons whose normal occupation is employment under contract of service.
- Others gainfully occupied, including employers, traders and independent workers of all kinds.
- Housewives, that is married women of working age.
- Others of working age not gainfully occupied.
- Below working age.
- Retired above working age.
(iii) The sixth of these classes will receive retirement pensions and the fifth will be covered by children’s allowances, which will be paid from the National Exchequer in respect of all children when the responsible parent is in receipt of insurance benefit or pension, and in respect of all children except one in other cases. The four other classes will be insured for security appropriate to their circumstances. All classes will be covered for comprehensive medical treatment and rehabilitation and for funeral expenses.
(iv) Every person in Class I, II or IV will pay a single security contribution by a stamp on a single insurance document each week or combination of weeks. In Class I the employer also will contribute, affixing the insurance stamp and deducting the employee’s share from wages or salary. The contribution will differ from one class to another, according to the benefits provided, and will be higher for men than for women, so as to secure benefits for Class III.
(v) Subject to simple contribution conditions, every person in Class I will receive benefit for unemployment and disability, pension on retirement, medical treatment and funeral expenses. Persons in Class II will receive all these except unemployment benefit and disability benefit during the first 13 weeks of disability. Persons in Class IV will receive all these except unemployment and disability benefit. As a substitute for unemployment benefit, training benefit will be available to persons in all classes other than Class 1, to assist them to find new livelihoods if their present ones fail. Maternity grant, provision for widowhood and separation and qualification for retirement pensions will be secured to all persons in Class III by virtue of their husbands’ contributions ; in addition to maternity grant, housewives who take paid work will receive maternity benefit for thirteen weeks to enable them to give up working before and after childbirth.
(vi) Unemployment benefit, disability benefit, basic retirement pension after a transition period, and training benefit will be at the same rate, irrespective of previous earnings. This rate will provide by itself the income necessary for subsistence in all normal cases. There will be a joint rate for a man and wife who is not gainfully occupied. Where there is no wife or she is gainfully occupied, there will be a lower single rate ; where there is no wife but a dependant above the age for children’s allowance, there will be a dependant allowance. Maternity benefit for housewives who work also for gain will be at a higher rate than the single rate in unemployment or disability, while their unemployment and disability benefit will be at a lower rate ; there are special rates also for widowhood as described below. With these exceptions all rates of benefit will be the same for men and for women. Disability due to industrial accident or disease will be treated like all other disability for the first thirteen weeks ; if disability continues thereafter, disability benefit at a flat rate will be replaced by an industrial pension related to the earnings of the individual subject to a minimum and a maximum.
(vii) Unemployment benefit will continue at the same rate without means test so long as unemployment lasts, but will normally be subject to a condition of attendance at a work or training centre after a certain period. Disability benefit will continue at the same rate without means test, so long as disability lasts or till it is replaced by industrial pension, subject to acceptance of suitable medical treatment or vocational training.
- Pensions (other than industrial) will be paid only on retirement from work. They may be claimed at any time after the minimum age of retirement, that is 65 for men and 60 for women. The rate of pension will be increased above the basic rate if retirement is postponed. Contributory pensions as of right will be raised to the full basic rate gradually during a transition period of twenty years, in which adequate pensions according to needs will be paid to all persons requiring them. The position of existing pensioners will be safeguarded.
- While permanent pensions will no longer be granted to widows of working age without dependent children, there will be for all widows a temporary benefit at a higher rate than unemployment or disability benefit, followed by training benefit where necessary. For widows with the care of dependent children there will be guardian benefit, in addition. to the children’s allowances, adequate for subsistence without other means. The position of existing widows on pension will be safeguarded.
(x) For the limited number of cases of need not covered by social insurance, national assistance subject to a uniform means test will be available.
(xi) Medical treatment covering all requirements will be provided for all citizens by a national health service organised under the health departments and post-medical rehabilitation treatment will be provided for all persons capable of profiting by it.
(xii) A Ministry of Social Security will be established, responsible for social insurance, national assistance and encouragement and supervision of voluntary insurance and will take over, so far as necessary for these purposes, the present work of other Government Departments and of Local Authorities in these fields.