CHAPTER 14: BACK TO THE DRAWING BOARD Making the standstill work The board now had two

major tasks: first to implement the standstill, and then to bring it to an end by means of new regulations which could be applied consistently without provoking another political crisis. The principle of the standstill was simple. Each case was to be assessed twice: first in accordance with the regulations, and secondly as if transitional payments were still in operation. Payments would be made on whichever basis was more favourable. Putting it into practice, however, was less simple, especially in new cases where the boards officers had to make the best estimate they could of the amount that the local authority might have paid under the transitional payments scheme. A district officer in the south of England wrote, in the second week of the standstill: I have been in communication with the different Public Assistance Authorities in this District and while a few of the Committees work to a definite scale subject to such alterations as they consider necessary, many Authorities were not bound by any rule or regulation other than that of considering each case on its merits. It is understood that the absence or otherwise of certain members of the Committee was reflected in the amount awarded and, having regard to this, it is not surprising that there are wide variations between similar cases. Even where Committees worked on scales it is observed that they were not always applied, and that the element of discretion was freely exercised without any apparent reason.
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But for the fact that many of the boards officers had personal experience of administering transitional payments, it is hard to imagine how they would have coped. As it was, there must have been many cases where the ATP (assumed transitional payment) rate was a matter of guesswork rather than precise calculation. There were also technical differences between transitional payments and unemployment assistance, which could affect the comparison. In particular, earnings were taken into account on a daily basis for transitional payments while, under the boards regulations, they were treated as part of the weekly income. Which method was more favourable could vary from week to week. Despite these problems, the standstill was to continue for nearly two years, far longer than anyone had expected: the new regulations did not begin to come into effect until 16 November 1936. Meanwhile the board was obliged to perpetuate the anomalies, inequalities and illegalities (legalised by the standstill) of the transitional payments scheme.

A new start: the May memorandum

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The memorandum submitted to Stanley by the board on 19 February included, at Tom Jones suggestion, a request for confirmation of six fundamental principles on which future policy should be based: (1) that the household means test should continue; (2) that there should be changes in the contributions expected from members of the household; (3) that the boards scale should not normally conflict with levels of wages; (4) that it should have regard to the unemployment benefit rates; (5) that, after allowing for rent and the special needs of individual cases, the aim should be equal treatment of applicants throughout the country; and (6) that the second appointed day, when the board would take over public assistance cases, would be postponed until the standstill came to an end. This attempt to get the government to commit itself in advance, however, was unsuccessful. Even if they had wanted to, the members of the cabinet committee would have had difficulty in reaching agreement on the boards fifth point, uniformity of treatment throughout the country, on which Stanley was known to entertain serious doubts. Instead of replying to the boards questions, the committee decided to ask the board for its own views. The boards officials, therefore, applied themselves without further delay to the task of revising the regulations.
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In view of the embarrassment caused by the amendment of the original draft regulations after their submission to the minister, it was essential to ensure that the revised draft would be accepted without amendment. The procedure adopted was to produce a report on the operation of the existing regulations together with detailed proposals for the future - the May memorandum, submitted to Stanley on 21 May 1935. Any amendments agreed between the board and the minister could be incorporated in the draft regulations before they were formally submitted. Failing agreement, the board could theoretically stand on its legal rights and submit regulations which it knew to be unacceptable to the minister, leaving him to amend them. But it was hardly conceivable that, having capitulated over the standstill, the board would defy the government over the new regulations. In the event, the May memorandum proved to be the opening bid in negotiations which dragged on for over a year, in the course of which the board was repeatedly compelled to retreat in the face of ministerial anxieties. The board began serious discussions in the week of Chamberlains tea party at the beginning of March. It was hard to have to take back to the drawing board a scheme over which they had laboured and fought so recently and which they still believed might have been workable but for the cowardice of Stanley and his colleagues. Little of their frustration emerges from the minutes of board meetings, but Markhams letters to Jones are, as usual, revealing: ... this dreary futile job is beginning to take the heart out of us. I like hard work but I jib at working hard pouring water into a sieve. ... The water and sieve job has been going strong this morning and a, to me, entirely incomprehensible Rent Rule has been passed.
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That was at the end of March 1935, with a full month of this initial stage of the water and sieve job to come and the real battles still ahead. Nevertheless, the proposals which emerged in May represented a genuine attempt to meet the main criticisms of the 1934 regulations without committing the board to indefensible extravagance at the taxpayers expense. As a basis for the original regulations, there is little doubt that they would have commanded general support and enabled the scheme to be launched successfully. There would, no doubt, have been disturbances in South Wales and dissatisfaction over the treatment of low rents in parts of Scotland, possibly leading to some concessions, but there would certainly have been no need for a standstill. The process by which the main proposals in the May memorandum were worked out can conveniently be discussed under five headings: the rent rule, the scale rates, the treatment of earnings, the involvement of local opinion through advisory committees and - the issue which was to prove most controversial - the transition from the standstill to full implementation of the new regulations. Rent Since the treatment of low rents had been a major factor leading to the standstill, it was clear that a substantially different rent rule was required. One possibility was that, instead of including a notional basic rent allowance in the scale rates, housing costs should be met by a separate allowance, the scale rates being assumed to cover all other needs. The main argument for this approach was simplicity. It seemed paradoxical that, under the existing rent rule, a man with a large family and, therefore, a high basic rent allowance, was for that reason more likely to have his allowance reduced than a man with a smaller family paying a similar rent. Even when the logic was understood, it could still be argued that the childrens scale rates were a sham, since in many cases part of the allowance for an additional child was taken back under the rent rule. The presentational arguments, however, did not all point the same way. Without the rent element, the scale rates would have compared unfavourably with unemployment benefit. A reduction in the childrens scale rates to exclude rent would have been particularly controversial, but an attempt to devise a scale exclusive of rent but retaining the existing childrens rates had to be abandoned on grounds of cost. The only practicable solution, it seemed, was to keep rent in the scale rates but operate the rent rule in a way which would produce fewer cuts. The May memorandum revived one of Reynards earlier proposals: that the scale rates should be assumed to cover a range of rents. For example, if the households scale rates were between 24s. and 30s. a week, they would be taken to cover rents between 5s. and 7s. and a rent addition or deduction would be made only if the rent were over 7s. or under 5s. Violet Markham was right in describing the rule as entirely incomprehensible, and in this respect it was certainly not an improvement, but it would have produced far fewer cuts than the
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existing rule. For that very reason, however, it would have been less effective in holding down the level of allowances in rural areas. This led the board to reconsider the question of rural differentiation and to propose that the regulations should provide for discretionary reductions for this purpose. The rent rule, however, was to undergo many more permutations before emerging in its final form.
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The scale rates Having decided that the scale rates should still include rent, the board was able to use the existing scale as a starting point, modifying it to reduce the number and size of the cuts. The changes, however, were relatively small, reflecting the boards concern about the relationship between the scale and the unemployment benefit rates, as well as about the comparison with low earnings. First, the supercut for large families was dropped and the discrimination between male and female members of a household reduced from 2s. to 1s. per week. Markham, returning to the battle she had fought unsuccessfully on the original regulations, argued that the difference between the 15s. and 14s. rates for men and women living alone should be abolished. The 14s. rate was inadequate to keep a young woman in respectability or an elderly one in meagre comfort. Only the previous week, she noted, Ministry of Labour officials had objected to a scheme for training women as cooks on the grounds that 25s. a week was an inadequate maintenance allowance in London. She rejected the argument that women could live more cheaply than men:
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Decent lodgings cost more for a woman than for a man. She cannot avail herself to anything like the same degree of the cheap lodgings or well organised hostels where a man can take refuge during a period of unemployment. Similarly a man has many opportunities of getting cheap meals at places where a selfrespecting girl cannot penetrate. When looking for work a womans clothes and boots are subjected to greater proportional wear and tear. These drawbacks in my opinion more than cancel out such fractional cash advantages as a scientific diet - if a girl could provide it - might entail. The world is a bleak place for the unemployed but surely it is a bleaker place for the unemployed solitary woman than for the unemployed solitary man.
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The board accepted these arguments but decided that the 15s. rate should be applied flexibly, in view of the wide range of applicants living alone or in lodgings, including elderly men in rented rooms, single women paying high rents for decent accommodation, young men paying 12s. a week for board and lodging, men living in common lodging houses or caravans, and those transferred from their home areas in search of employment.
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Another proposed change, reflecting views expressed at the conferences of appeal tribunal chairmen in March 1935, was the grouping of household members aged 16-17 with those aged 18-20
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instead of with the 14-15 age group. With the elimination of sex differentiation for all those under 21, this meant an increase of 1s. for boys and 2s. for girls aged 16-17. The board considered the possibility of more generous treatment of long-term applicants. Reynard suggested an addition of 2s. a week after 12 months unemployment. Reid advised against this both on administrative grounds and because, in practice, a households resources might be adequate despite the presence of a long unemployed member, and the proposal was not included in the May memorandum.
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Earnings The one area in which substantial concessions were obviously necessary if the new regulations were to be politically acceptable was the means test itself - in particular, the treatment of earnings. Here, the boards generosity was not constrained by comparisons with insurance benefit or by the need to preserve work incentives: indeed, the incentive argument could be used to justify bigger earnings disregards. The proposal made for the earnings of applicants and their spouses and parents was that the first 3s. per head and half of any earnings over 6s. should be ignored, with a maximum disregard of 8s. a week for those earning 16s. or more. This compared very favourably with the existing rule, under which at least half the earnings, however small, were taken into account and the maximum disregard was only 5s. But it still meant that a young unemployed person with a parent in full-time work would not normally qualify for assistance and would have an incentive to leave home.
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For the earnings of applicants sons, daughters and other relatives, the board reverted to the proposal Eady had favoured, to disregard the whole of the earnings up to a relatively generous level and a proportion above that level. After juggling with several variations, the amounts decided on were 12s. plus half the excess for a son or daughter, and 12s. plus two-thirds of the excess for brothers, sisters and more distant relatives. The first 12s. was intended to cover the basic needs of the earner. These proposals represented a further substantial mitigation of the household means test. For sons and daughters, it is true, the difference was not very great: the new rule was more generous to those under 21, since it assumed their basic needs to be the same as those of adults, and it also favoured adult sons and daughters earning more than about 20s. a week, but some of those earning 20s. or less could actually have been worse off. Brothers, sisters and more distant relatives, however - to the extent that they were treated as members of the household rather than as boarders - stood to gain. Brothers and sisters, in particular, would have been treated far more leniently as a result of the proposal to apply the same formula to them as to more distant relatives. The board was to have second thoughts about this proposal but, had it been implemented, an applicants brother aged 21 or over earning 30s. a week would have been allowed 24s. instead of 19s.2d. for
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his own needs, while a brother earning 60s. would have been allowed to keep 44s. instead of 26s.8d. Sisters, and both brothers and sisters under 21, would have gained still more, since the sex and age discrimination in the existing earnings rules would have been abolished. Local opinion Under section 35(3) of the 1934 Act, the board was required to establish advisory committees of persons having local knowledge and experience in matters affecting the functions of the Board. Unlike the appeal tribunals, they did not need to be in place before the first appointed day, and little progress had been made towards setting them up. The original motive for inserting section 35(3) had been to provide a role for members of guardians and relief committees whose main function was to be transferred to the boards officers. The cabinet committee on the bill had been told that the advisory committees would continue the welfare work of the guardians and relief committees and might even help applicants to present their appeals - an idea which the board would have considered highly dangerous. During the debates on the Bill, Betterton had suggested other tasks for them: advising on rural differentiation and local factors such as rents, acting as a link with public assistance authorities and voluntary organisations and advising on difficult cases. These, however, were all matters with which the board and its officers, initially at least, felt competent to deal without the help of advisory committees. When Violet Markham, in November 1934, consulted the leaders of the National Council of Social Service, who might have been expected to be enthusiastic about the injection of voluntary service into the boards work, the secretary of the council, Lionel Ellis, wrote, The more I think about it the more difficult I find it to see any useful job for the proposed Advisory Committees! His advice was to appoint only one central committee and see to it that it took some considerable time to prepare its first report; for until one sees how this new machine works it is really impossible to see whether the appointment of Advisory Committees would introduce oil or grit. Markham herself had serious doubts about the use of advisory committee members as voluntary welfare workers.
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With the standstill, however, the appointment of advisory committees had become more urgent. In the Commons debate on 29 January, Stanley had stressed their importance and undertaken to represent to the board the strong desire expressed in this Committee, a feeling I share, that these advisory committees should be brought into being at once. Accordingly, a plan was submitted to Stanley on 1 March 1935 for appointing local committees, as soon as practicable, in particular to advise on cases involving the penal provisions of section 40 and 41 of the Act and to help co-ordinate the boards work with that of other local bodies. Regional committees would be set up later, to advise on the working of the new regulations and help in promoting the welfare of the unemployed. Stanley, who by then had serious doubts as to the future of the board, reacted negatively: before any formal steps were taken, he
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would want to consider in detail the committees constitution and functions. Meanwhile, if the board wanted advice, it could consult local people informally. Despite this discouragement, however, the board proceeded with its plans, asking its district officers to suggest possible committee members, areas to be covered by the committees and topics on which they could usefully advise.
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The May memorandum confirmed the boards intention to proceed without delay with the appointment of committees for fairly large areas, working mainly through sub-committees or panels of members with special knowledge of particular matters or special associations. They would advise on questions that seem peculiar to the locality and on cases requiring penal action or personal service by voluntary workers. Such personal service, the board hoped, would be provided in many cases by committee members themselves or the associations to which they belonged. But another year was to pass before the committees were set up, by which time they had been allotted more specific functions in the transition from the standstill to the new regulations.
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Liquidation of the standstill The last major issue dealt with in the May memorandum was the transition from a situation in which nearly half the applicants were receiving allowances under the Standstill Act. It was estimated that the new regulations would reduce the proportion of applicants for whom standstill allowances were more favourable to 34 per cent, less than half of whom would be heads of families. A six months transitional period was proposed, during which special assessments could be made of such amounts as were reasonably required to avoid hardship. Cuts would be made gradually over that period, the initial reduction being only a quarter of the excess allowance, except where this would leave the household with a total income of more than twice the scale rates.
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The cost of the boards proposals Cost was not the main consideration in the minds of the board and its officials in drawing up these proposals. Expenditure under the original regulations was now estimated to have been running at about 38 /2 million a year, 5 /2 million less than had been predicted and 2 /2 million less than the cost of transitional payments. There was plenty of scope for remedying the defects of the regulations without exceeding the original estimate. The May memorandum, however, put the initial cost of its proposals for the transitional payments class at only 42 /2 million, which meant that the board would still be spending only half the extra 3 million on which so much emphasis had been placed. Most applicants would be better off and very few worse off than under the existing regulations, but one in three would be entitled to less than the inflated allowances they were getting under the standstill. The board maintained that the proposals for gradual liquidation of the standstill, increasing the total cost in the first year by up to 1 million, would mean
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that many of the theoretical cuts would never actually take place, since the applicants would be back in work before the time came for the new regulations to be applied to them. Nevertheless, the figures were sufficiently alarming to ensure that the proposals would not be accepted without the most careful scrutiny by ministers whose fingers had been badly burnt by the 1934 regulations.

Reinventing the dole: a history of the Unemployment Assistance Board 1934-1940 by Tony Lynes is licensed under the Creative Commons Attribution 3.0 Unported License. To view a copy of this license, visit http://creativecommons.org/licenses/by/3.0/ or send a letter to Creative Commons, 444 Castro Street, Suite 900, Mountain View, California, 94041, USA.

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