The Dominion. SATURDAY, JANUARY 20, 1912. A HUGS EXPERIMENT.

Dominion, Volume 5, Issue 1342, 20 January 1912, Page 4

The Dominion. SATURDAY, JANUARY 20, 1912. A HUGS EXPERIMENT.

It is perhaps not generally realised in this country that there will shortly be commenced in the British Isles the largest experiment in social legislation that has yet been made in any part of the Empire. The House of Lords, contrary to the expectations. of many, and against a considerable weight of thoughtful cpinioh, passed the National Insurance Bill without amendment and almost without debate. The principle of the measure, which (according to the convenient summary cf the Spectator) is intjnled to provide "insurance against sickness and against one form of invalidity for the working classes,'and against unemployment in two large trades," was from the first accepted by all parties, but th 3 Act. as Parliament, at the instance of Mr. LloydGeorge, has passed it, comprises such a mass of complex provisions that even Lord Haldane, who had charge of it in the Upper House, claimed in noticeably dubious terms that he understood it and could explain it. It gives vast and undefined powers to the very numerous officials who will be appointed to administer it. It has evoked strong protests from doctors, domestic servants! and their mistresses, Friendly Societies, and other important sections of those affected. Bv-elections and informal referenda in certain constituencies ha.'c furnished _ pr>! ; sumptivc cvidcnce that the nation is mistrustful of its results. It creatcs a liability in the shape of taxes and compulsory contributions, which, according to* the Government estimate, will reach by 1932-3 the sum of tv enty-six millions sterling per annum. Another estimate places it at forty millions. The House adopted at the eleventh hour 470 amendments which wore "guillotined" through with little or no discussion. Even the friends of the measure openly rely upon the practical working out of the scheme to reveal scope of the amending legislation which everybody admits will be necessary. Compared with this sensational plunge, New Zealand's boasted record in experimental legislation seems a mere triviality. Lord Haldane was careful to say that the Bill could, do no more than provide the ground oti which a system could be experimentally built. By way of justifying this method of proceeding, he quoted the example of national insurance in Germany. "The great system which came into existence more than a generation ago under the auspiccs of Bismarck had been considered with all the perspicacity of that highly scientific nation, never given to launching a schcme without the most careful consideration and thinking out beforehand." The great majority of the German people, according to Lord Haldane, thoroughly approve of the scheme and declare it to be a great blessing, although "experience disclosed the necessity for the transformation of the original ideas, with the result that modification after modification has been made in the system as experience progressed, and even to-day great, modifications are pending." Lord Haldane did not go further into the German example just, then, but we arc fortunate in having before us some very remarkable evidence on the subject. "The Practical Jlbsults of Workingmen's Insurance in Gerniany" is the title of t a brochure by Dr. Ferdinand Friedensburq, who has just honourably retired from_ the official headship of the Imperial German Insurance Office. Dr. Friedensburq declares his continued belief in the policy of workingmen's insurance, and insists that it has accomplished much good, but he considers that the present system involves such grave evils that it has b'ccoriie "an allpervading cancer .that is destroying the vitals of our State." This is the system which was launched after four years of patient German .scientific thinking, and amended dnring a generation of solid practical German experience. And no man is better entitled to an opinion on the whole subjcct than Dr. FiukdknbIt epjjeaia from, his tratimonj,

that one effect of German National Insurance is to turn the average decent man and woman into liars. . Pension lias, it is stated, uublushinglv mvolvo even family life. Attempts are lmule, ever and again, to transform tho wile into tho employee of her husband, ami Ihe husband into the cnmloycc of his wife, as circumstances may demand; brothers and sisters become servants; and even children not yet four Years old are alleged to be regularly employed in agricultural pursuits. In his old age the man who has retired from active life again becomes a ploughbny, and tho mother-in-law who has been received into tho household is metamorphosed into a mirsrgirl. This latter transformation became especially popular since, when the invalid and old age insurance law went into ell'ect on January 1, 1891, in-rsons who li.nl air«Miiy reached the ago of seventy could receive pensions onlv after prebf* that they had been engaged in an occupation entitling thorn t) insurance within the three years previous.

Some of tho claimants show a good deal of German subtlety. A man who was injured going to church to fray for rain insisted that he was engaged in an agricultural pursuit and therefore entitled to a A peasant _ who contracted bloodpoisoning in a finger while undressing her child claimed that' the undressing was an agricultural pursuit, since the child minded the geese. And, of cours:, every child tilled was the "sole support" of his father and mother, "gave his parents every pfennig he had, and himself lived on air." There is a tendency in the National Insurance Officios to stretch every point in favour of the applicant:

Documents are searched—or, at least, should be—with tho utmost meticiilosity, on the chance that so'mo point may still bear "interpretation" in favour of the insured; expert opinion is heaped on expert opinion, oltc-n with the additional requirement of tedious., hospital observation of the person alleging injury, especially in the case of one of the many neuroses which it is .so much tho fa-hion to claim to lx> the results of accidents.

In 188G the accidents reported were 100,159, and compensation was awarded in 10,540 casos. In 150S these figures had risen to 6G2,r;21 and 142,905 respectively The cost of the scheme has exceeded every estimate. In the words of the New York Post's summary of Dr.. Louts H. Gray's translation of Dk. Fimedensbhkg's work:

Ivnt unnaturally, the sober business men ot Germany—those who are responsible tor her wonderful industrial progress— aro appalled at the increasing pension burdens of a country which is 'staggering under the heaviest military burdens in Europe. It must soon, according to the Essen Chamber of' Commerce, "reckon with a burden of about 312.500,000 dollars each joar laid upon our industrial activity simply and solely for purposes of social insurance." Elberfeld and Lubeck are other towns that see in tho excessive character of these insurance burdens a growing menace to Germany's vast foreign trade. Moreover, Dr. Friedensburg reports, thoro is nowhere left a traoe of that fine glow of social and philanthropic enthusiasm "which once greeted the new institution." Everybody who jK-ssibly -;an do so endeavours to escape from the burdens of insurance/. There is endless redtape, and rndlcss officials travel up and down tho country inspecting, "controlling," a.nd being controlled. Insurance has developed "to-an incredible extent the German evil of bureaucratic formalism." In the provmo?s the .best voluntary Social workers "havo withdrawn in disgust."

In fairness to the British scheme, it must be noted that its authors, forewarned by the German experience, have provided for the utilisation of the. machinery of the Friendly Societies in placo of the State. "Th; Friendly "Societies have this enormous advantage,"' said Lord Hat, dane, "that if you work through them you have a state of things in which every member is interested in getting the-utmost for his money, in keeping down false eases, in exploding cases of malingering, in ei,courarring habits of carefulness and prudence. . . . We were led to

that consideration by the experience of Germany.'" It is, however, perfectly clear that this feature of the British schcme can only be a partial preventive of waste. The Friendly Societies do not include all the workers to be insured, and it is not denied that a very large number of Government officials will have to be employed. _ Lord Lansdowne cited an actuarial estimate that there would h- eighteen million contributors —eighteen million separate accounts. "It means," he added, "a vast amount of correspondence, a vast amount of inspection, a vast amount of collecting in small sums. Just consider for a monaut the immense army of officials that will be necessary in order to superintend the working of this machinery." He calculated that, on the assumption —a very generous one from his point of view—that the cost of supervision would not run to a higher rate than that of ths existing industrial insurance companies; £5,000,000 a year would be poured away iu salaries and expeases. Notwithstanding these and other objections to the Bill as it stood, loiid Lansdowne and the Unionist majority in the Lords decided, for reasons related to the general political situation, to let it pass unchallenged and unaltered. The New Zealand Parliament will probably be called upon, before very long, to face this very_ question of national insurance against sickness and unemployment. Hero as elsewhere, there will be little or no difference of opinion as to ths beneficent objects of such a measure, but the experience of Gcrmviy and the ci'rcuinstanccs of tin inception of tr. British scheme should be tak<m to heart as a warning of the exceeding difficulty of the task that aw.vits our legislators.