THE PROGRESS AND PROSPECTS IN BRITAIN
AN ADDRESS BY SIR WILLIAM CLARK, G.C.M.G., K.C.S.I., D.C.L.
Chairman: The President, Major F. L. Clouse
Thursday, October 10, 1946
MAJOR CLOUSE: Gentlemen of the Empire Club, Ladies and Gentlemen of the radio audience. Since the Empire Club of Canada is affiliated with the Royal Empire Society in London, we have the honour and pleasure of being host to a very distinguished former chairman of that Society
SIR WILLIAM CLARK, G.C.M.G., K.C.S.I., D.C.L. Sir William resided among us for six years, when in 1928 he became First High Commissioner in Canada for His Majesties Government of the United Kingdom.
It was during those years that so many Canadians came to know his worth and of his scholarship and of his vast experience in British Empire matters.
Closely associated with men like Lloyd George and Winston Churchill and with the diplomatic and business intercourse of such widely different countries as India, South Africa, Basutoland and several others, our guest has devoted so much of his life to the welfare of the Commonwealth.
Sir William is also a businessman for he is a director of a well known British bank, a great English railway and an old established steamship line.
Educated at Eton School and Cambridge University, Sir William Clark is I know, greatly interested in what I may term "the student body of the Empire" for he is closely associated with' London House in London, England, which functions for the benefit of people from all over the Empire doing post-graduate work in Britain, in a manner similar to that of Hart House here in the University of Toronto.
The degree of Doctor of Civil Laws has been bestowed on Sir William by Queens University, Bishops University and the University of Western Ontario. He is also Knight of Grace of the Order of St. John of Jerusalem.
You will, I think, agree that with this all-too brief a sketch of Sir William that he is well qualified to discuss with us "the Progress and Prospects in Britain" a subject of much significance for Canada and, I venture to say, the world at large.
Sir William, we welcome you back to Canada and trust that you and your daughter will enjoy the renewal of our acquaintance. Gentlemen-Sir William Clark.
SIR WILLIAM H. CLARK: Mr. President, Members of The Empire Club of Canada: Let me first thank you, Gentlemen, for the very kind welcome you have given me and for your hospitality, and you, Sir, for the all too kind things which you have said about me.
I bring to you the greetings of your fellow Society, the Royal Empire Society in London, and I very much appreciate what your President said just now about London House. London House is a hostel which was initiated before the war for the accommodation of post graduate students from the Dominions who otherwise might find life in London a rather lonely and desolate business. I don't mind mentioning that one of the things I am interested in over here is that of interesting the public generally here in London House, partly because we wish to get
as many students from Canada as we can. They are beginning to flow in now. During the war I may say we entertained large numbers of officers and men of all ranks there, and just possibly, it has occurred to us, we might be able to raise some funds for the House in the Dominion. I am not dealing with that this morning.
Well, Gentlemen, looking back after the forty years of my public service to which your President referred in almost embarrassing detail, I consider I have been signally fortunate in the diversity of the continents in which I have been called upon to serve, and I can say, in all sincerity, that I look back on the six years I spent in Canada as among the most significant and the most interesting and the most important, because in those six years I was privileged to take a very modest part in the very beginning of that new concept of Empire, the British Commonwealth of Nations, which has so amply justified itself under the desperate ordeal of war.
Then there was Canada to fall in love with, and all the many friends one made in this friendliest of countries. So you will very readily understand with what enthusiasm I climbed the gangway up the mountainside of the Acquitania three weeks ago, starting for Canada again--an enthusiasm just a little dampened by finding when I went on board that I was not, as on my previous occasion, received as a specially honoured guest, but was crowded among those whom the Chairman of the company described at a recent annual meeting, as "civil servants and other substandard passengers".
It is tempting to dilate on my impressions of the Canada of today when returning to her after an interval of twelve momentous years, but there are two good reasons against it. First, I have hardly had time to sort out and classify these impressions after all the glamour and excitement of revisiting old haunts and meeting old friends and, next, you know much more about Canada, her thoughts and aims than I ever can and you would, I am sure, greatly prefer that I should talk to you about Britain and her affairs, where I may have the advantage.
But one thing I hope I may say of Canada, since it is something which perhaps you do not so fully realize for yourselves, something which an outsider is in a better position to appreciate, and that is to emphasize the immense prestige with which Canada has emerged from the war, a prestige won by her achievements alike on the field of battle, in the council chambers of the Allies, and in her great industrial effort, a prestige which has brought her at a leap to a high place among the nations that really matter in the world.
Now, let us turn to Britain, and I hope we too may claim some credit under our great war leader for our part in the desperate dangers of those six years. But the Britain with which I am concerned this morning is the Britain of today. At first sight to the outside observer, despite the passage of the months since hostilities came to an end, Britain still looks more than a little worse for wear. During those six years of conflict her complex industrial capacity was mobilized wholly for the needs of the Forces and for defence. Supplies of goods for civilian consumption were cut to a minimum. No domestic houses were built; no work of redecoration was possible; no renewals or repainting was allowed on railroads, on busses or tramcars. Civilian life ticked over on the absolute minimum of conveniences over and above the essential food supplies which never failed.
I suppose most of us thought rather innocently that with the defeat of our enemies these things would right themselves pretty quickly. But it hasn't worked out like that. Urgent national needs have had to come first, just as they did in the war. The first of these, as in all other countries, has been the building of houses to make good the effect of six years arrears of construction, intensified by the destruction and damage caused in London, and many other great cities by enemy action. Four million houses were damaged and a half million totally destroyed. Then there has been the restoration of our export trade always vitally important to a country dependent for its well-being on huge imports of foodstuffs and raw materials, and now doubly so when we have become a debtor nation. In addition we have assumed immense responsibilities for promoting every aspect of progress in the Colonial Empire, and for the reconstruction and rehabilitation of the war-stricken countries. All this has meant that for the public at large there has been little margin for making good the wear and tear of war, and wind and weather, and for providing the less urgent consumption goods, so that, as those of you who have visited us will know, our cities and homes have a somewhat drab and melancholy look about them, not so much from the open scars of war, which have a dignity of their own, as for lack of that lick of paint which covers a multitude of sins. And still, after a year of peace, the housewife stands in queues. We are still very strictly rationed in food and clothing, and so on, and as you know very well, have recently added bread to the list; and even where there is no actual rationing, there is certainly no plenty. Chasing one's favourite cigarette is still one of our major occupations. Austerity is still very much the keynote.
I am not going to embark on comparisons and contrasts with other countries, always an unprofitable affair. I will only say that I am very much enjoying my present sojourn in your hospitable land. But you must not think that the people of Britain are letting these things get them down. They are disappointed, no doubt, that the return to normal life is a journey so much longer than they had anticipated; they permit themselves a reasonable ration of our time-honoured practice of grumbling; but they accept the situation with philosophy, except perhaps in the matter of housing which in the fullest sense of the phrase "comes home" all too bitterly to the homeless. And anyhow, whatever else may have failed us, we have one consolation, eminently characteristic of our nation--sport has resumed its ancient heritage; racing, football and county cricket have been or are in full swing; never have such crowds poured into the race courses, cricket and football fields, undeterred by the vagaries of a climate which has been more than usually fantastic in the past few months of what we hopefully call the summer.
Moreover, Britain has embarked upon a high endeavour--the endeavour to establish for her people on an assured footing the two great social and economic freedoms--freedom from the fear of want when through sickness or in the end from the inescapable process of the years the worker loses his earning power; freedom from the fear of enforced idleness, of idleness enforced through no fault of the worker but by lack of demand for his labour. These aims are not peculiar to Great Britain; they are, I know, very much the subject of discussion in Canada between the Provinces and the Federal Government. But at home they have by now quite a long history behind them, dating back indeed some thirty years to the pioneer work of the Liberal Cabinet of 1906, a Ministry if ever there was one, of all the talents, which will go down to history as one of the most brilliant of British governments in modern times-the government which initiated old age pensions and insurance against unemployment and then added to it Mr. Lloyd George's great scheme for insurance against invalidity and for the provision of health services.
Since then successive governments of all political complexions have made their contributions, but the scheme embodied in last session's legislation is on a still broader and more comprehensive scale. It follows largely the line of the Beveridge Report and the plan evolved by the wartime Coalition Government. For this is a non-party matter, such differences as have arisen being upon points of varying importance affecting especially the rights and participation of private enterprise and private charity. The scheme begins to come into operation this month when increased old age pensions will be paid to some 4,000,000 persons at present receiving them on a lower scale, at a cost of the Exchequer of £80,000,000 a year. Family allowances for children after the first child began to be paid in August. In due course when the plan has been brought into full operation, it will provide as one comprehensive whole, sickness benefit, unemployment benefit, retirement pension and, finally, a death grant to cover the last expenses which humanity can incur in this vale of tears.
With a scheme on this scale I think you will agree that Britain is embarking on a social adventure which, if not different in kind from previous plans, is yet so different in degree that in its social and psychological consequences it may well be considered something revolutionary.
Let me in especial draw your attention to one item in it which is significant of the new outlook. The term "old age pension" has disappeared and "retirement pension" has taken its place. The former suggested something in the nature of alms when a man had become incapable of earning through advancing years, and this aspect was accentuated in earlier years by pensions only being payable to those without other means. Retirement pension on the other hand, implies that on reaching the statutory age of 65, a man is entitled to leisure in the evening of his days and, of course, he has himself paid part of the cost in advance; he has contributed through payments every week, the other two contributors being his employer and the state.
Over and above the insurance scheme and complementary to it is the ambitious plan for the national health services. The bill in which this scheme is embodied has not yet passed through all stages of its parliamentary career, but it will become law in a few weeks and then will gradually be brought into operation. The plan aims at nothing less than the provision for all classes of the community of every kind of health service-hospital and specialist services, health centres and general practitioner services, supplementary services, such as midwifery, maternity or even the free provision of spectacles and other appliances together with drugs and medicines--all this financed in part from the premiums of the insurance scheme and the rest provided by the state. The broad objective of it all is that there should be available for everyone, in the first place the services which can prevent or cure disease and then, if disease does come, payments to mitigate its effects.
All this, of course; is going to cost a lot of money, to which must be added by the way, £66,000,000 to compensate the medical profession for the abolition of the sale of practices and, as business men, you may have been wondering where it is all coming from. Well, I am not sure whether I quite know the answer to that one. It is far cry from my own brief sojourn in the Treasury nearly forty years ago as private secretary to the Chancellor of the Exchequer, when the City of London was up arms because we were adding some £13,000,000 if I remember rightly, to a budget of about £150,000,000, in order to pay for old age pensions and other early ventures in social security. But we have altered all that and I think the answer is that in the first place, by safeguarding the health of a nation you add greatly to its capacity for increasing the national wealth, and next, that social security implies the continuous maintenance of spending power and of consumption. Full employment, to which I am coming in a moment, works in the same way, and it is assumed that it also can be maintained. These things being so, and provided always that there is a corresponding increase in production (that is the crucial sine qua non), the economists tell us that it should be possible not only to finance these vast schemes, but also to reduce taxation below its present levels. That, too, is important to the picture as a whole. The present burden of direct taxation is so severe that there is danger of stifling or at least impairing enterprise.
In the case of unemployment, the economic outlook associated with the name of the late Lord Keynes points to the same prime objective, the objective first and foremost of prevention. And the prevention is of no less vital importance though the injury is moral, instead of physical. Unemployment Insurance can safeguard the unemployed worker against destitution, but it does not touch the spiritual evil. Idleness is usually demoralizing even for those who can afford many distractions, but it is disastrous to men condemned to loaf for weeks on end in street or pub or cinema, feeling that no one wants their labour and gradually losing the capacity to make good if the chance comes. Moreover, the fear of unemployment which affects much larger numbers than those actually unemployed, stimulates ugly passions such as fear of the foreigner, jealousy between men and men and of men against women, in the universal scramble for jobs.
The modern theory, as I understand it, is that full employment can be secured and maintained if a nation makes up its mind to ensure an adequate outlay at all times. This must of necessity be made the responsibility of the state. Put very briefly, the state must plan long term programmes of capital expenditure and direct or encourage similar programmes on the part of private enterprise. This may mean in some years national expenditure in excess of what the state receives in taxation, but Lord Beveridge and those who think with him, urge that that should not be regarded as a deterrent. I imagine that our Government had the possibility of action of this kind in mind in the powers which they have taken for the control, if necessary, of private investment, but for the time being in Britain, there is no need for special action.
One of the most striking contrasts between pre-war and post-war Britain is that whereas between the two wars there was an apparent superfluity of population, one of our difficulties now is shortage of manpower. I say apparent superfluity because after all, there must always be two alternative causes of unemployment--it may sometimes, though perhaps rarely, be caused by an excessive density of population, or it may be caused by shortage of demand for the same population's labour. Today in Britain there is an immense demand for all forms of production, most of it of course financed by the Government--a demand for capital goods, such as houses and buildings of all sorts to make good the destruction and arrears of war, and in connection with ambitious schemes for town planning; capital expenditure for the renewal of railways, roads and harbours, demand for consumption goods of every kind, both at home and overseas. These demands could easily have absorbed the pre-war working population into total employment, but in fact the numbers are now actually available, including both men and women, over and above the Armed and Auxiliary Forces, are smaller than in 1939. If one includes those in the Forces, the total working population is about half a million larger than before the war; but in the Armed Forces today there are one and a half million more than in 1939, and some three-quarters of a million demobilized men are enjoying a well-earned holiday and have not yet taken up employment. Government service too requires sorne 400,000 more than in 1939. So one way and another, the total number available for industry works out at more than two million below the pre-war figure. Some unemployment no doubt remains, about 376,000 in all, mainly in depressed areas such as South "Vales, and the Government are, endeavouring to deal with this by introducing new industries into such districts.
However, taking it by and large, I think we may claim that the change-over from war to a peace footing in Great Britain has been brought about with remarkable despatch and success. The Armed and Auxiliary Forces reached their peak in June, 1945 at over 5,000,000 men and women. Demobilization has proceeded smoothly and they have now been brought down to 2,000,000. Moreover, we have been fortunately free from labour strikes, though there have been a certain number of the local type, launched without authority of the unions, and consequently often difficult to deal with. During the war our export trade became an almost negligible quantity; it reached its lowest point in 1943 when its volume fell to less than 30 per cent of that of 1938. By the second quarter of this year it had been brought back to 97 percent, very nearly to the 1938 level. The current figures include relief and rehabilitation supplies for liberated countries which I suppose are not paid for; nevertheless, that is a remarkable achievement. It has meant, of course, considerable sacrifices for the home consumer who, in ordinary circumstances, might reasonably have expected to get the first cut at the joint, but the Government no doubt felt that in the conditions of today the claims of the export market must be regarded as paramount. On the other hand, in the case of our imports; these same circumstances have operated the other way, preventing recovery to prewar levels. The total volume of imports in fact in the first six months of this year stands only at two-thirds of the pre-war figure. Restriction has been inevitable if we are to pay our way, and that has meant cutting down on all imports except the essential foodstuffs and raw materials. That has been exasperating, I am afraid, to our friends who would wish to be sending us manufactured goods of every kind, many pleasant things which have been, to put it mildly, in short supply in Britain for years; but if it is any consolation to them to know it, it is no less disappointing to the would-be customer at home. But in these matters, as in so much else, austerity for a time must rule our lives.
The time has come to try and sum up. I think one may reasonably feel that, as conditions are today, the barometer for trade arid industry and employment in the United Kingdom is set fair, but we do face one or two troublesome questions. The first of those is the problem of coal, the commodity on which the whole structure of British industry depends, for Providence has not been kind about supplying us with other sources of power. Besides in happier times coal was the largest single item in our export list. This again is largely a question of manpower. The total number employed in mining in the United Kingdom has fallen from 873,000 in 1939 to 791,000 in the current year. It was expected that the nationalization of the coal industry would reverse this trend, but these hopes have been disappointed. The truth is that the industry has for long been unpopular; it must take time to change the feeling about it; and there is just this one drawback to the present full employment that since new entrants into the labour market can now freely pick and choose, as is indeed most right and proper, they naturally tend to go into the industries which are thought to afford the more agreeable forms of occupation. On the long view mechanization may prove the solution, but, unfortunately, it is the immediate need that matters.
Another somewhat disturbing factor in relation to export trade is the rising level of costs, of production caused largely by increases in wage-scales of practically all classes of labour in mining, in industry and in transport. For the time being the whole world is a seller's market but price will again be important when the immediate demands are satisfied and markets once more become competitive. However, there is no point in looking for trouble, and but for the one black spot of the coal problem, I think we may feel well satisfied with the progress which has been made; especially when we consider the enormous complications involved in the changeover from industries organized wholly for war to the more diversified needs of peace.
That, then, is the picture. I have tried to show you that Britain has not lost her old spirit of adventure; once more she is seeking to open up a new world, a world free from the fear of enforced idleness and unmerited want. Difficulties, perhaps serious difficulties, may well lie ahead if conditions become less favourable; but Canadians, I am sure, will watch with sympathy the progress of an experiment which, if it succeeds, as our authorities confidently believe, will afford a new hope for mankind.
Thank you very much for listening so kindly. It has been a very great pleasure, may I say, to be here.