UNEMPLOYMENT INSURANCE

Hokitika Guardian, 1 November 1929, Page 7

UNEMPLOYMENT INSURANCE

(By “X.”)

At the present time considerable political capital is being made cut of the question of unemployment and pressure has been brought to hear—fortunately without result—on the Government to rush through, this session some, scheme under which the unemployed could, as a matter of light, claim to draw from a fund to be provided for unemployment insurance, quite irrespective of whether they had contributed to it or not.

There is nothing perhaps in which there has been more confusion of thought than this question of unemployment insurance. In the first pkne it lias> been assumed—quite wrongly—that it is as practicable to insure against unemployment as it is against fire, accident, or sickness; that a man can insure himself against losing his job just as reasonably as he can insure against his house being burned down, or against meeting with an accident. But a worker can tasilv lose his job at any time through his own fault, or default, and yet nothing could be proved against him which would bring him under the law as would be the case if he burned his house down to claim the insurance. Afisadventure of any kind is an insurable risk, but no person can insure against the results of their own actions. ilt is true a proportion of the unemployed may have lost their jobs through no fault of their own, but no one will dony that another proportion are out of work through causes attributable to themselves, And yet if being out of work is taken in itself as sufficient to constitute a “right” to participate ju unemployment insurance benefits the really efficient and willing hut unfortunate worker is placed on the same footing as the “waster.” It is no doubt through realising this that many of the workers themselves are not enamoured of any unemployment insurance scheme.

But even assuming that it were practicable to insure against unemployment in the same way as against fire or accident no such scheme would provide work for the unemployed or have any tendency in that direction. Fire insurance is not a preventative of fires, nor does accident insurance reduce liability to accdcnts. On tie other hand, just as over' insurance tends to increase fire risks by rendering the : insured more careless—and even in some cases inciting even to 'incendiarism—so would unemployment insurance t'end to increase unemployment by rendering the worker mare careless as to whether he retained his job or not, and in some cases—as particularly demonstrated in Britain —declining to take work except under terms and > conditions practically prohibitive.

Th© fallacy that unemployment insurance would in some way tend to prevent or minimise unemployment if) apparent. Work can only be found when industry is prosperous and floui ishing, and in New Zealand finding work for the workless is directly dependent on opening no and developing our binds, opr agricultural, pastoral, tjmhip:, mineral and other resources, Tt Is private enterprise which ultimately provides the solution of tip.) unemployment difficulty, and . though, in abnormal conditions of the labour market the assistance of Government may be necessary in providing Work for these private industry cannot absorb thlH CXDQdjant should never ho regarded as more than a temporary one, [p any case it is work that should be found for the unemployed, and not a pension to keep them in idleness. The registration system now ftdopt'Oll by the 'Government should have one good effect—in weeding out those who aie genuinely in need of work from those who are merely clamouring for it as political agitators. Tt is worth noting that several hundreds have already refused work when offered, and if reasons for such refusal are considered inadequate no further offers of work are to bp made to them,

Some economiitsts have suggested that a form of unemployment insurance based on weekly contriVnitions by the workers and employers, put] .subsidised by government is practical, and economic in so far that a certain amount of surplus labour is essential in industry, and therefore the industrialist should he called on to contribute to its maintenance in a “sustenance” wage. r I lie initial mistake is made, however, that this would provide poi-mnnent machinery for undmploymont prevention—which it would not. In Great Britain unemployment is increasing though the amount contributed in unemployment insurance has reached appalling figures. dt has been denied that payments from the iinemnloyment funds are a; “dole.” Mr Wilford lips just stated that on his visit to England he obtained important statistics from official sources which showed that instead of this assistance to unemployed workers being a “dole” it was nothing of the kind. It was the people’s own insurance and figures would convince the most doubting. The figures given wore as follows for one year: fontxUnited bv enrdovers, £-107.000,OC0; by workers £123,000,000: b.v Government, £05,000,00-0; by loan, £47,000,000. If the British employers have bad to contribute in one year £407.000,000 toward supporting the unomluved. and the Government £142,000,00-) while the balance has had to be made up hv workers in employment it would be interceding to follow the process of. reasoning by which the

recipients of theso enormous sums base the objection of the term “dole.” "Whether Air Wilford’s figures, and his conclusions, are correct or not it was certainly reported officially that between June, 1918, and December, 1927, out of work donations and unemployment benefits had cost the British Government '£879.000.000 .£39,000,C00 extra was then allocated and more was required. Evidently unemployment insurance—like pensions funds and civil service .superannuation—may well assume proportions which were never originally anticipated, and therefore any Government is well advised to carefully consider what results may follow its introduction. It is not "only the economic but the moral factor also which requires consideration. Except on purely humanitarian grounds no one has a “right” to claim any payment from the Government or anyone else except for services rendered, or ns a recognition for past services. Ihe clamour about “right to work” is often only a demand for the wherewithal to remain in idleness, and any system which recognises this demand is merely a direct encouragement to the irresponsible and shiftless at the expense of- the industrious and frugal.

The position in Britain has been complicated by the vital and humanitarian necessity for providing work for tile millions of men demobilised after the war. No one could question the rierht of these men to special consideration. New Zealand made snecial provision for its returned soldiers —a very difficult proposition and one which entailed the loss of several millions. But no exception was taken to'tlio principle involved, only to the details which proved very costly' to New Zealand without in many eases adequately benefitting those It was intended to serve, Great Britain no doubt philosophically regards the heavy losses shown Oil unemployment insurance as a necessary result of post-war reconstruction. But the figures and results of the past eleven employment insurance is no safeyears show most conclusively that unguard whatever against unemployment. On the other hand it is e vidently a very serious draw on industrial resources, a heavy tax on the community generally, and has a demoralising effect on a portion at least of the people by leading ihein to rely as a right on assistance from outside instead of relying on their individual efforts. In a young country like New Zealand the damage which might be caused by introduction of such system can hardly he over-estimated, and it is to be hoped the Government will give the matter a very mature consideration before taking any action.