THE H.B TRIBUNE SATURDAY, OCTOBER 29, 1932 THE “MEANS TEST.”

Hawke's Bay Tribune, Volume XXII, Issue 270, 29 October 1932, Page 6

THE H.B TRIBUNE SATURDAY, OCTOBER 29, 1932 THE “MEANS TEST.”

This expression, which has figured frequently in recent London messages on the unemployment problem, and its application are perhaps not quite as clearly understood here as where they are being so keenly discussed and opposed. In essence the means test consists in an insistence upon an enquiry into the individual resources of those who make claim for maintenance out of public funds raised by taxation. A good deal of misapprehension has arisen from the promiscuous use of the word “dole,” applying it indifferently both to legitimate payments out of the Unemployment Insurance Fund and to relief payments granted out of the National Treasury. Payments made under the former category were made as of right to those who had contributed to the insurance fund, though it has to be admitted that the fund had, under the Labour Government,, eventually drawn heavily upon the Treasury by way of what was delicately termed “borrowing” from it. On the other hand, relief payments made directly from the Treasury were essentially of a charitable nature, and it has to be understood that they extended not only to those outside the insurance scheme, but also to those who had exhausted their rights under that scheme. It has • also io be borne in mind that under the very lax administration of previous Governments there had been widespread abuse of both recourses, in many cases resulting in combined drawings much better than would have been the incomings from full employment at standard wages. The means test is designed for the purpose, in a general way, of limiting what may be termed benevolent payments from the Treasury to those who are without means of their own wherewith to provide themselves with the reasonable necessaries of life. The need for some such restriction had come to be recognised even by the Labour Government when in office. Mr. Ramsay MacDonald, now Prime Minister in the National Government, a few days back reminded Mr. Lansbury, the leader of the Labour Opposition, of this when the latter was raising objection to its pre-

sent operation. The main contention against the means test lies in the argument that it virtually imposes a penalty upon the thrifty members, of the wage-earning class.* More especially is this applied to those who duly made their contributions to the Unemployment Insurance Fund. Many of these, having exhausted their right to draw upon the fund for twenty-six consecutive weeks, are classed among the “transitionals,” for whom maintenance has to be provided until they are again qualified for the insurance benefit by securing further employment. It has certainly to be allowed that there is a very great deal in this argument, and it is alleged that the application of the means test has resulted in many setting about the extravagant spending of such savings as they may have made, ,thus bringing them again onto the “dole.” On the other hand, however, it has also to be admitted that practically at all times the thriftless, the shiftless and the unfortunate are a burden upon the thrifty. But it is only at a time like the present, when there are so many of them in the aggregate, that a realisation of this is broug’ .forcibly upon us. Possibly, too, we may see in the rapid expansion of what are termed social services a factor operating against thriftness much more potent than the means test in its permanent effect. Taking the Old Country as an instance, we find that only twenty years ago the total annual expenditure of taxation money on these services amounted to no more than £63 million. Within ten years it had mounted to £271 million, while by 1929 it had reached £404 million. Thus within that relatively short time it had gone up by more than 500 per cent. When it comes to be considered that the whole of this vast expenditure had to be borne by t’.e general body of taxpayers it can be understood how heavily these services were bearing upon industrial resources while relieving the many from individual responsibility. The problem is one that stands looking at from both sides, even though our sympathies must necessarily be with those whose personal savings are being depleted.