National efficiency
Fears that Britain was in decline as a world power led to the idea that Britain had to improve its national efficiency by taking steps to improve the quality of the workforce. If Britain was to compete and maintain its position as a world power, then it had to be run efficiently with a strong, healthy and well-educated workforce.
The Boer War (1899 - 1902)
During the war, the British army experienced great difficulty in finding fit young men to recruit as soldiers. One in three potential recruits was refused on medical grounds. This led to questions being asked about the physical condition of the working class male. Would he be able to perform the tasks expected of him in the workplace and on the battlefield? The Government would have to do something to ensure basic health levels among the population.
Popular socialism
The Labour Party had just been established and it was winning public support for its campaigns for social welfare policies, such as old age pensions and unemployment benefits. The ruling Liberal Party recognised the threat this new party posed to its traditional support in many working class areas. To counter the threat from the socialist and Labour movement, the Liberals realised that they had to instigate social reforms or risk losing political support from the working classes.
A new liberalism
A new type of Liberalism had emerged by 1906, and it was this 'new liberalism' which provided the inspiration for the reforms. New Liberals, such as Lloyd George, Winston Churchill and Herbert Asquith, argued that there were circumstances in which it was right for the state to intervene in people's lives.
The German model
The example of Bismarck's progressive social legislation in Germany, coupled with her economic and military strength, impressed both Lloyd George and Churchill. Among other measures, the Germans had instigated an early form of sickness insurance for its workers. Lloyd George and Churchill felt inspired to introduce similar style reforms in Britain.
'Gas and water socialism'
Public works schemes to improve living conditions and public health had been established in the late 19th century, often set up and run by Liberals. These small, local schemes raised the possibility of similar schemes being a success on a national scale.
The beginnings of reform
From the turn of the 20th century, laissez faire (the policy of non-intervention in relation to social problems) became discredited. The same old problems of poverty and ill-health still remained.
The Liberal reforms of 1906 to 1914 are very important because they show a marked change in government policy from a largely laissez faire approach to a more 'collectivist' approach. The government now accepted that it should have a much larger role and responsibility in helping those sections of society who could not help themselves.
In the latter part of the nineteenth century governments began to take tentative steps towards the provision of basic welfare services, for example, the Education Acts and the public health laws that were passed.
However, many problems still needed to be tackled and it was in the relief from poverty that the government made the least movement from the Poor Law principle. Voluntary action, private charity and self-help were still the watchwords of the day, but local and national government now began to play a more positive part in enabling people to get back on their feet. The real turning point was when the Liberals passed their series of reforms between 1906 and 1914.
Between 1906 and 1914 the Liberal reforms attempted to deal with the problem of poverty. The Liberals focused on four groups in society - the old, the young, the sick and the unemployed.
Old age pensions
In 1908 the Liberals introduced old age pensions which became law in 1909. This Act gave pensions of five shillings per week (25 pence in today's money) at the single rate to persons over 70 whose incomes were less than £21 per year. A married couple received seven shillings and sixpence a week. This sum could be collected at the Post Office. A smaller amount was paid to slightly higher earners. People who had an income greater than £31.50 per year received no pension at all. Those who had habitually failed to work or who had been in prison also received nothing.
The major criticism of this Act was that it did not go far enough. The money was not enough to enable people to pay for the barest necessities and, although it helped, it was not the answer to old age poverty. Also, many elderly people needed financial help long before they reached 70 years of age. In fact most died before receiving a pension.
'Children's Charter'
In 1906 the government allowed local authorities to provide free school meals for poor children. In 1907 school medical inspections began, although it was not until 1912 that free medical treatment was available.
Social reformers blamed poverty for causing crime among the young people. There was also the view that by sending young law breakers to adult prisons they would simply learn how to be better criminals. As such, in 1908 juvenile courts and borstals were set up.
These reforms, including forbidding the sale of cigarettes and alcohol to children under 16 years of age, were given the name 'Children's Charter' because it was believed these measures would guarantee a better life for young people. However, the provision of school meals was not made compulsory until 1914 and researchers found that during school holidays the growth of children slowed and body weight often declined.
Medical inspections did little to solve any problems they uncovered and so it was not until free medical treatment became available in 1912 that the situation could get better. However, education authorities largely ignored the provision of free medical treatment for school children.
Finally, as we know by the standards of today, attempts to protect children from the effects of tobacco and alcohol have met with limited success.
Health insurance
In the early twentieth century a free National Health Service did not yet exist and the poor could not usually afford medical services. To help address this, the Liberal Government introduced the National Insurance Act in 1911.
For the first time, compulsory health insurance was provided for workers earning less than £160 per year. The scheme was contributory. The worker paid fourpence a week, employers paid threepence and the state paid twopence. The scheme provided sickness benefit entitlement of nine shillings (45 pence), free medical treatment and maternity benefit of 30 shillings (£1.50).
Unemployment insurance
The second part of the National Insurance Act dealt with unemployment. Most insured workers were given seven shillings (35 pence) unemployment benefit a week for a maximum of 15 weeks in any year if they became unemployed. This scheme was also contributory - financed through a combination of worker and state contributions to the scheme.
However, this Act only provided for the insured employee and not his family. Also, the Act was meant only to cover temporary unemployment and only applied to seven trades, most of which suffered from seasonal unemployment. When long term unemployment increased after World War I, the system began to break down as the government was taking in less money from workers than it was paying out to the unemployed.
Results
Overall, the Liberal reforms marked a transition point between old laissez-faire attitudes and those of a more collectivist nature. The reforms made only limited inroads into the problem of poverty. The pensions paid were inadequate and the unemployment benefits were limited to only certain trades, and then provided only for the employee and not his family. The government was prepared to intervene to help the poor, but the poor had also to help themselves by making contributions towards their benefits.
Winston Churchill summed up the aim of the Liberals when he said 'If we see a drowning man we do not drag him to the shore. Instead, we provide help to allow him to swim ashore.' In other words, the Liberals tried to provide some help for the poorer sections of society in order that they could help themselves.
