The Washington times., 1934-12-25
By CHARLES A. SMITH
Copyright, 1894. International News
Service

CODyIlKnI, 1904 AHtcEuoSAOAoA A'S"O
Service
LONDON, Dec. 25.-Possessed
of the oldest unemployment PROB,
lem in modern history, England
now is overhauling it's methods IN
the light Of % years experience
with nationwide contributory IN
surance against jobleSSneSs.
= Virtually the entire machinery
which makes national provision
for the payment of nearly 10 mil
lion dollars weekly to more than
two million insured unemployed
is being revitalized.
Occasional spells Of idlenesS
due to seasonal or market tluctu'
ations are, it is believed, tit sub
iect for protection by insurance to
which employers and workers
must contribute. On the other
hand, long period unemployment,
which would cripple any social
insurance scheme and which at
one time threatened to bankrupt
the dole fund exchequer, must be
met by relief paid outright from
national funds.
Four Years Study
The new scheme which goes
into effect in July represents the
: elimination of four years OF re-
: search, legislation, and admins
: trative organization.
5 The first British social insur-
ance scheme, as founded in 1911
!, to cover 2,25O,O0O workers, was
) planned on an actuarial basis in
:. such a way that contributions
would provide benefit at the rate
: of roughly $1.75 a week to unem-
ployed workers. The trades CHOSEN
were those in which unemploy'
ment was due to temporary tluc-
tuations of business.
+, Then came the postwar slump,
and the strain on the funds re-
sources was first met by increases
in the amount of contributions.
which came to be divided equally
between worker. employer, and
the national treasury.
Strictly Limited
Benefit was limited strictly to a
certain number of weeks, although
extended benefit was granted
from 1921 onwards at the discre-
ton of the supervising officials
Of the ministry Of labor.
After that time, if the worker
was still jobless, and unable to
support himself, he became sub
iect to the ordinary poor law.
The result was that during the
period Of widespread local taxa
tion in distressed areas rose to
astronomical heights.
The British cabinet and even
tually Parliament agreed that part
of the burden should be borne by
national taxation and the addi-
tional relief handled by local gov
eminent agencies became known
in 1923 as transitional pay
ments."
High Cost Of Dole
The dole fund starts 1885
charged with a debt to the treas
ury of over half billion dollars,
due to the enormous government
expenditure.
The new law was passed on the
recommendations of commission
of inquiry, which, reporting in
1882, found that the dole problem
had become completely trans
formed by the slump phenomenon
Of Chronic unemployment
Insurance, it was held, was still
suitable for the original purpose
of tiding workers over short pc
riods of idleness, but the finan-
cial soundness of the insurance
scheme would be threatened if
workers unemployed for many
years at stretch were to be pro-
vided for.
The government experts calcu-
late that the British insurance
scheme to cope with long periods
of unemployment eventually will
be able to be self-supporting and
pay its way with the present rates
of contributions on the basis of
total of three million unemployed