The Minister for Local Government and Public Health who is in charge of this Bill is not present, but I observe that his Parliamentary Secretary is here. I authorise him to attend to take this stage of the Bill and to take part in the debate on it.
National Health Insurance Bill, 1933—Second Stage.
Question proposed: "That this Bill be now read a Second Time."
Cathaoirleach
The necessity for this Bill has arisen from the unsatisfactory financial position of a number of the approved societies which are administering the National Health Insurance Acts. There are at present 65 of these societies one of which is subdivided into 19 branches. Each society is a separate entity entrusted with the administration of health insurance for its own members. It has its own income derived from the contributions of its members and from the interest on any funds it has accumulated and from the State grant which is two-ninths of its expenditure on benefits and administration. It has on the other hand its own expenditure—payments of benefits to members and payments for cost of administration. The amount which can be expended on administration is limited to 4/5 per member per annum. Every five years each society is valued by a valuer appointed by the Minister for Finance and the Acts contain provisions for dealing with any surplus or deficiency which may be disclosed. If there is a surplus which the valuer certifies as disposable—that it can be spent without endangering the power of the society to provide enough to meet the disablement and maternity benefits, then that surplus can be expended on additional benefits during an ensuing five years period under schemes sanctioned by the Minister. Benefits given in this way are, for example, dental, optical and hospital benefits.
If on the other hand the society shows a deficiency the position is more complicated. It has in the first instance a reserve fund to fall back on known as its contingencies fund. Each society has a contingencies fund which has been accumulating during the five years covered by the valuation from a small fraction of each contribution paid in respect of its members. The society's contingencies fund is used as a first reserve to meet the deficiency. If this is not sufficient there is a second reserve fund known as the National Health Insurance Central Fund. This fund has been derived partly from State grants and partly from a fraction of each contribution paid in respect of members of all societies, but no contributions have been made to it in recent years and it actually stands with accumulated interest at about £120,000.
This fund is available to meet a deficiency still remaining in any society after its own contingencies fund has been exhausted, if the society can show that the deficiency is due to any special cause beyond the control of the society, e.g., abnormal sickness among the members due to their employment or environment or other physical condition, or any epidemic disease. If a deficiency still remains which is not met by the society's own contingencies fund or by a grant out of the central fund, the Acts provide that such deficiency must be met by increasing the contributions for the members of that society or by reducing the benefits. The latter could be effected either by reducing the amount of the payment or by reducing the period for which the benefit is payable.
With these facts in mind we can now examine the results of the three valuations which have so far been held, the valuation dates being 31st December, 1918, 31st December, 1923 and 31st December, 1928. The 1918 valuation does not give a clear indication as regards the position in the Free State, because at that time many Irish insured persons were members of British societies and vice versa. After the Treaty, however, a clear cut as regards funds and membership was effected and the valuations in 1923 and 1928 show the results as they affected all Free State insured persons. In 1923 there were 79 societies and 20 branches. 72 societies and 20 branches showed a surplus amounting in the aggregate to £626,811, and seven societies showed a deficiency of £13,613. There was, therefore, a net surplus of £613,648. At first sight this looks a very favourable result, but in fact a sum of £370,000 had been carried forward from the previous valuation period and some societies, which prior to the separation from Great Britain had been international, profited more from the division of funds which occurred when the sepration was effected than the claims experience of their own members would justify. On making allowance for these items the actual surplus earned in the five years period 1919-1923 was only £50,000.
At the 1923 valuation, 55 societies showed a surplus of £513,626 and 10 societies were in deficiency to the extent of £51,268. The net surplus was, therefore, £462,358 and as there had been a carry forward from the previous valuation which with interest amounted to £510,000 it followed that there was a loss on the five year period 1923-28 of £50,000.
The Irish Insurance Commissioners, who were then in office, were, therefore, faced with a position which was obviously deteriorating, a profit of £50,000 in the period 1918-23 had been converted into a loss of £50,000 in the period 1923-28. The expenditure on benefits had also been increasing to a somewhat alarming extent; it had risen from £439,000 in 1923 to £686,000 in 1928, and in the circumstances the Commissioners felt that the next valuation due at the end of 1933 might disclose a position which the existing reserve funds would be insufficient to meet. They decided, therefore, to ask the actuary for a forecast of the position and they put before him all the available figures. These figures were unfortunately, borne out by the actuary's forecast. He estimated that certain societies will show surpluses aggregating £335,000, while other societies will show deficiencies aggregating £510,000. To meet this deficiency of £510,000 in these societies there are their own contingencies funds, which will amount to £110,000 and the national health insurance central fund of £120,000, so that there would still be a deficiency of £280,000 unprovided for, and yet if all the funds were available for all the members the national health insurance scheme as a whole would be solvent because against the ultimate deficiency of £280,000 there is the surplus of £335,000 in the other societies together with their contingencies funds, which amount to £70,000, leaving a balance on the right side of £125,000.
Under the existing provisions of the Acts, however, there would be no remedy for the societies in deficiency except to raise the contributions or reduce the benefits for their members. In other words, although the scheme as a whole would be solvent at the 31st December, 1933, it would be divided into two groups of societies, one of which would have more than was required to pay the statutory benefits, whilst the other would have to impose reduced benefits on its members. This anomalous position has entirely arisen from the grouping of insured persons into a large number of separate approved societies. These groupings have no relation to national health insurance as such. They vary very much in size, ranging in membership from 90 to 90,000. They also vary very much in character—insured persons being grouped according to trades, skilled and unskilled; professions, religion, temperance, and so forth. The membership of very few societies is representative of the general body of insured persons, and the whole scheme, instead of being a national scheme, is composed of a number of separate units, differing widely from one another in their experience as regards the two main factors of insurance, i.e., contribution income and sickness experience.
Those societies which are composed of members with steady employment producing a good contribution income, and with healthy occupations, resulting in a small sickness experience, naturally show much better valuation results than those where employment is uncertain and the conditions of employment detrimental to health, and the divergence between the two classes of societies has gradually become marked until the present stage has been reached. The Bill proposes to set aside this anomalous grouping by providing that all insured persons will be members of the same society and that the existing societies will cease to function. This proposal of unification is not new. It was one of the recommendations made by the Committee of Inquiry into Health Insurance and Medical Services which was appointed in 1924.
The advantages of unification are two-fold. In the first place, it will produce a really national scheme in which all insured persons will be on precisely equal terms. If a surplus is disclosed on valuation they will all share alike in any additional benefits provided. Secondly, it will be possible to have a more efficient and more economic system of administration under one society with one central staff instead of 65 societies, each with its own officials. The administration of benefits will be uniform and governed by the same standards for all insured persons. The small part-time agency system will be reorganised so as to allow of a large number of whole-time agents, permitting better supervision of and closer and earlier attention to members. In the cost of central administration substantial economies will accrue not only in the headquarters staff but also in allied services, including audit and valuation.
With one small exception the Bill is confined in scope to the provisions necessary for bringing about this change. It establishes a unified society to which the engagements of all the existing societies and branches will be transferred, and of which all insured persons will be members. During a transitional period of not more than three years the society will be governed by a provisional committee of three persons appointed by the Minister, and to them will fall the duty of setting up the society and taking over at convenient dates the assets and liabilities of the various societies. It will not be practicable to take over all the societies at once, and different dates will be fixed for different societies. They will arrange for the acquisition of premises which will be the headquarters of the society, and will appoint a secretary and treasurer subject to the sanction of the Minister. They will also draw up rules for the administration of the affairs of the unified society, and will provide for the election of representatives of insured persons on the committee of management which is to succeed them in the government of the society at the end of the transitional period.
As soon as the unified society is in full working order the provisional committee will hand over the administration of the society to a committee of management composed of 15 persons, namely three trustees appointed by the Minister, nine persons representative of insured persons and three persons appointed by the Minister to represent employers of insured persons. The next valuation is due to take place as at the end of the present year, and although it will not be possible to have all the existing societies transferred to the unified society at that date, the Bill provides that the valuation will be made on the same basis as if the transfers had been effected. In other words, the members and the assets and liabilities of all societies, whether transferred or not will be deemed to be assets and liabilities of the unified society at the date of valuation, and any surplus or deficiency disclosed will be dealt with as a surplus or deficiency of the unified society. As regards societies which have at present additional benefit schemes, the rights of members to such additional benefits are preserved until the date at which the schemes will ordinarily terminate. In the process of unification certain officials of existing approved societies will necessarily be displaced.
Dismissed.
Displaced.
Dismissed.
Displaced.
Dismissed.
Apparently the Senator is bent on having the last word. The Bill enables the unified society to pay compensation on reasonable terms to persons so displaced who fulfil certain qualifying conditions and who are not taken into the employment of the unified society. The compensation will be by way of gratuity and will be payable to all secretaries of approved societies, all whole-time employees and all part-time employees who are mainly dependent for their livelihood on their earnings from health insurance. Qualified persons who have less than five years' service will get one-fifth of their annual remuneration for each year's service. Those who have five or more years' service will get one-sixth of their annual remuneration for each year of service. In calculating the years of service in the latter case, and addition of one year will be made for each two completed years of service with a maximum of ten added years. The payment for compensation will be a charge on the administration account of the unified society. The amount required may be borrowed from the health insurance fund and repaid, with interest, by instalments over a period of years.
The Bill contains clauses of a technical nature dealing with St. James's Gate Health Insurance Society and with the Dublin United Tramways and Omnibus Employees' Health Insurance Society which were approved as Employers' Provident Funds and which require special treatment in view of the fact that the employers were responsible for the solvency of the societies' funds. It is proposed that health insurance will, in future, be entirely divorced from all forms of commercial insurance. The unified society will deal with no business other than that of health insurance, and the Bill requires that all persons connected with the society, whether as members of the Committee of Management, as officers or as ordinary employees, will transact no insurance business of any other kind. It is to the best interest of insured persons that those who are directly dealing with their health insurance should give undivided allegiance to that business and should have no occasion to further the interests of commercial insurance.
The only other matter dealt with in the Bill is a change in the powers given to referees who hear appeals under Section 67 of the National Insurance Act, 1911. Under that section the referee appointed is given power to hear and decide any appeal submitted to him. It is proposed that in future the power of decision shall vest in the Minister.
I am very sorry that the present Administration has sponsored this Bill. It is a direct violation of everything they said during the elections about their Christian social aims. I am positively amazed, when I hear the figures from the Parliamentary Secretary, and I will ask Senators to bear this in mind: The Parliamentary Secretary told us that this recommendation arose out of a Committee of Inquiry set up in 1924. A valuation had taken place, I think, up to 31st December, 1923. Is that right?
Yes, that is right.
The figures, at that time, revealed a surplus. Another valuation was taken in 1928, and 53 societies—I am not quite certain that the figures are absolutely accurate, but I think they are substantially accurate—showed a surplus of £513,625, and ten societies showed a deficit of £51,286, leaving a surplus of approximately £463,000, but by reason of certain other considerations the Parliamentary Secretary tells us that if you took all the figures into consideration that £462,000 surplus would really mean a deficit of some £50,000. He told us, however, in the next sentence, that during the period from 1923 to 1928 benefits had risen from £439,000 in 1923 to £686,000 in 1928 so that, in fact—and let the Parliamentary Secretary and his bureaucracy disguise this as they like —the effect of this is to curtail the benefits. The benefits were accruing too largely and too quickly—that is what is behind this Bill. Those figures will be in the Official Report, and anybody who is capable of understanding figures will see that the figures the Parliamentary Secretary has given us blow all his pretentions about efficiency and economy sky high. If you put it as a business man would put it in figures, it means that the insured persons have got, in the interval from 1923 to 1928, £247,000 increase of benefit at a cost of £50,000. Let the Parliamentary Secretary try to reply to that when he comes to answer it.
I would be perfectly ready to admit that it was a pity, in the first instance, when national health insurance was established, that there were so many small sectional societies approved but when, on the Parliamentary Secretary's own figures, 53 of them, on the last valuation, have shown a surplus as against ten showing a deficit, the disadvantages are very much less than I had anticipated. I cannot help contrasting the difference as between giving benefits to insured persons and collecting income tax. There is no unification there, you know. They want efficiency, and real efficiency, there, so they have inspectors and collectors all over the country.
The one management, though.
There is practically one management at the present time but, from all the reports that I hear, you can take it that the local inspector of taxes reserves to himself the right of private judgment to a very large extent. I submit, however, that there is no justification, on the figures, for this Bill. In fact, if you examine the figures closely, you will find the exact opposite. I have no doubt that the fund will be kept in credit and in surplus for the future, but at a loss of benefit to the insured persons. I had one example of how those things were done. We are told here, and the public are told, that there are pensions for blind people but there is one doctor to examine all the blind people in Ireland. There is one referee from the Department—the Minister himself told me, because I went to him with a case in which a certificate had been given by the local medical person. It was in cold print and it was approved, but he said that, if the person who alleges he is blind, did not get it, he could appeal, but if, on the other hand, it is the Ministry or the local authority who appeals—I do not know exactly which it is does appeal—the appeal is to be adjudged by a doctor appointed by the Local Government Department. I can see that cases of that sort will arise very frequently in the administration of this Act where you have a really bureaucratic control in Dublin and the local agent in a very subordinate and uninfluential position in comparison to his position now.
The Parliamentary Secretary, of course, likes to use nice kind words, but when anybody finds his position summarily terminated, I call it dismissal. He can call it displacement, if he likes. He has given the House a certain scale of so-called compensation which is to be paid. If it is efficiency to create unemployment by throwing on to the scrap heap any person who has been for ten or twelve years in such an occupation and who has reached the age of 40, the less of that sort of efficiency we have the better. We have a number of business people in this House. I should like to know how many private firms could not dismiss, or displace, or supersede, if they are nicer words, one, two or three employees with a little gratuity and go on as at present but, thank God, business people are not so soulless. This, to my mind, is a negation of everything the Government spoke of and advocated at the last election. I sincerely trust this Bill will be defeated.
I think we could have done without this Bill. It is rationalisation. That was popular a few years ago, but it is not popular now. I should like to know how many persons are going to be superseded and how many gratuitants will we have, as a result of this measure of rationalisation? I wonder does the Minister realise what a hardship it is to a person, who is in employment, to be suddenly thrown out of employment with a gratuity of one-fifth or one-sixth of his salary for each year of service? I should also like to know if there is any provision to be made for giving employment to those people who are to be put out of employment? I think rationalisation has gone too far and I think we could do very well without this Bill.
I am afraid I must differ with the two Senators who have spoken. Personally, I would hate to see anybody put out of employment, but when a Senator says that the beneficiaries under this Bill feel, when they are paying their instalments, the same temper that we all feel when paying income tax, I think there is something wrong with the existing measure. After all, you must bear in mind that the State and the employer have to make similar contributions to the funds of any society as the beneficiary under the Act pays, and it should, therefore, be a very good bargain for any member of an insurance society to be connected with one of them. I do not think that that feeling exists amongst these members. I do not think that they believe they are getting the full benefit and I think the Minister will be able to tell us how many dismissals or displacements are likely to take place because of this measure and in what direction added benefits will be given to the people who are insured under it. Of course, sometimes these amalgamations turn out very differently from what is expected. Most people thought that, when the railways were amalgamated, it would be very helpful to the community, to the shareholders and to the employees.
Not everybody.
It may happen that this may turn out to be such an amalgamation as the railways amalgamation proved to be, but, on the face of it, it certainly looks to be a great attraction for the beneficiaries under the insurance scheme. I think that Senators who opposed this measure ought to be able to show us where the benefits to the insured contributors will be curtailed in any way.
The Bill before us is being opposed by those who are nominally and usually supporters of the Government on the ground that it is bureaucratic and that it runs against the policy of decentralisation which the Government is said to have advocated at the last election and ever since. I think that it is a fair charge that the Bill runs against the trend of policy which the supporters of the Government advocated up and down the country in various walks of life and in various aspects of public affairs. I venture to say that, as time goes on, such advocacy will be belied by actual experience in most other affairs, as in this affair. I think that it is inevitable in modern life that with the inter-communication and economy due to centralisation of administration both in industry and in the administration of social affairs, the tendency will be towards centralisation. It will be very hard to resist, even if it is desirable to resist, that tendency. The experience of a few years will show the supporters of the present Government that they will not be able to resist that tendency. It would be wiser to take that fact into account and guide the affairs of State with the knowledge that that will be a tendency which it will be impossible to prevent.
I remember the initiation of this scheme very well. Many of us in the Labour movement were very doubtful and very critical of the proposal to have large numbers of different societies of varying class and character. We were in favour of a centralised system. I remember one man, who later became a national hero, saying it was very clever and astute of Mr. Lloyd George, who was then promoting the scheme, to throw the onus of refusing benefit upon the societies, particularly the societies working through local officials, and to take all the kudos himself. The way that scheme worked out was to throw into one, two, or half dozen societies large numbers of what might be called "bad lives," and to reserve the good lives for selective societies. You cannot call that a national scheme of insurance. If Senator Dowdall could confine himself to a particular class of risk in insurance he would, undoubtedly, do well. He could make very low offers of premiums if he could select good lives and low risks. But in this scheme, supposed to be a national scheme, there was a tendency to segregate and to convert it into a non-national scheme—to throw the bad lives into a few societies, and reserve the good lives for the other societies. That was the negation of a national scheme of health insurance.
Senator Crosbie made an analogy with the railways. I should like to remind him that, from the point of view of management, consolidation of the railways led to a very large saving in administrative expenses. Because of that, I think that the way the Bill proposes to deprive large numbers of those who have been partially earning a livelihood, of the opportunity to earn that livelihood, is unfair and unwise. If they are, in the railway phrase, "proved to be redundant," they should be reasonably compensated. However, that is a matter on which we shall have discussion on more than one occasion between now and the Final Stage of the Bill.
I am not sure that Senator Dowdall and others are right in criticising this Bill as leading to a bureaucracy that does not at present exist. Doubtless, there are local societies and trade union societies, run locally, in which there is a certain amount of personal contact and knowledge of the members by the management. But much the larger number of people insured in health insurance societies are just as bureaucratically managed to-day as they will be under this scheme. Let Senators consider the position of the health insurance societies attached to big friendly societies, and find out where they are managed from and what kind of bureaucracy exists in these societies. Is it an improvement on the bureaucracy which we can anticipate under a national scheme, as proposed in this Bill? I am still doubtful whether there is anything in the Bill which inevitably prevents the establishment of local advisory committees. I do not say that that is contemplated, but I see nothing in the Bill to prevent that. That brings me to the point that I think it would have been very much better if the Minister had submitted to the Oireachtas, in presenting the Bill, the proposed rules of the society which, I have no doubt, are already in type but which, under the Bill, are intended to be made by the provisional committee and, presumably, imposed on the new membership. At the initiation of the old scheme, there was a great cry raised regarding the fact that the membership would control the society. We know how that has been done in respect of the large societies. Some societies are governed by the members at aggregate meeting. Matters affecting the constitution of the management committee, changes of rules and so forth, are dealt with at aggregate meetings of the members. Other societies are managed by delegate meetings. Imagine a society of 90,000 persons being governed by aggregate meetings! In other countries there is a very much larger membership than that. Senators will realise that the pretence at democratic management in these cases has gone by the board. There is no reality in it.
I should like to know what is the intention under this scheme as regards the management of the society by the members. The provisional committee is to make rules for the election of a management committee. Presumably, the rules may be altered in the dim and distant future when the society is finally established. The Oireachtas should have before it the rules under which it is intended to govern the society, in the first instance, and it should not be left to the provisional committee to make and impose the rules upon the new membership. We ought to know what scheme is in mind in regard to the government of the society by the members. Nominally, the members are to govern the society but how is that going to be effected? Is it to be effected by local elections or by the pretence of aggregate meeting? Surely, we ought to have that information when dealing with the Second Stage of the Bill. We ought to have some idea of the intention in regard to this matter, because I have no doubt that the Minister or the Committee has clearly in mind what is proposed to be done. If that is not so, I do not think that the society should come into operation until the provisional committee has formulated its proposed rules and laid them on the Table, so that the House can discuss them. I think that it is unfair and unreasonable to take the present members of the health insurance societies, many of whom have a distinct part to play in the election of their management committees and in the governance of their society, and deprive them of that power and responsibility, imposing upon them the obligation to be members of a new society as to the rules of which they know nothing and will know nothing. As to what powers they will have in the future, they know nothing and will know nothing until the change over shall have been effected. I think that that is a fault in the presentation of this Bill.
I think, too, that we ought to be provided with much more statistical information as to the financial position of the various societies. The Minister has given us figures as to the position in 1928. We are told also that the present position has been submitted to actuaries and that the actuaries have reported. It is fairly well known within the societies that the actuarial position has greatly deteriorated since 1928, mainly because of the generally bad position regarding unemployment and the sickness which accompanies unemployment. Anybody who knows anything about this business knows that a man will decline to go on health insurance for a long time after he should have ceased work. He would much rather work in sickness and earn his full wages than go on to health insurance and lose the difference between the benefits and his wages. Consequently, men work on when they ought to be under the care of the doctor. With the growth of unemployment there has been a great increase in the number of sick cases. We also know that many men—and perhaps more women—find their way almost automatically, when unemployed insurance benefit has ceased, on to health insurance benefit, so that the so called prosperous days from 1928 to 1931 did not preclude very great growth in unemployment and loss to the health insurance societies. The deterioration took place in those years but that does not prove bad administration. I do not know to what extent people suggest that the societies are suffering deficiencies because of bad administration. I think they are suffering to a very small extent, indeed from that cause. Rather have the societies suffered because they have fulfilled their statutory duty.
I think it is true to say that there has been in many cases generosity on the part of the medical profession, probably due also, in the main, to their human sympathy and knowledge that a man or woman actually needs health insurance benefit, and the doctor's aid that would be forthcoming. But too often, also, I think doctors have been rather remiss and careless in the way they distributed their certificates. I do not know what way that would be remedied under the new scheme. To a considerable extent it will probably be remedied. In the formulation of rules, to some extent, provision might be made for local committees, which would be able to maintain that personal interest and knowledge that some societies have been so proud of and have done so well. I see nothing in the scheme as presented to us yet that would prevent that. On the whole the position that Senator Dowdall deplores could not have been remedied without some kind of centralised organisation. If this scheme, or some other scheme of the same nature, had not been brought forward you would have some societies —considerable societies—having to increase contributions or to reduce benefits and, to that extent, done damage to their membership, which comprises a very considerable share of the total membership in the country.
The clauses relating to compensation for disturbance and for redundance will have to be examined critically and closely, and I hope the Senate will express a view that there should be more reasonable consideration given to the position of these men who are, by an Act, being deprived of the butter for their bread. While 5/-, 7/- or 10/- a week may not seem much to lose, it is a very great deal to people earning 30/- or £2. These men are going to be deprived in considerable numbers of that earning. I hope something will be done, at least, to remedy their cases. Senator Dowdall stated that we could have done with out this Bill. We could, but I do not know for how long. I think for a very short time.
There is one aspect of this question of health insurance that I think the new society should take greatly to heart. It is a complaint in the great English societies as well as in the societies here, that too little has been done with that part of the scheme which contemplated the preventive side of health insurance, the prevention of sickness through sanatorium treatment and convalescent homes. That kind of work ought to have been done to a very much greater degree than it has been done, and I think that State health insurance might, at the beginning, do it with very much greater effect, and with better results, by a unified society, than by a large number of smaller societies.
Under this Bill "the appointed day" may be fixed by the Minister at a date not more than three years after the passing of the Act. That means that during that period the unified society should be worked and administered by a committee of three trustees appointed by the Minister, so that for three years, if he takes full advantage of the time at his disposal, the whole business of health insurance shall be worked by three people without the subscribers having any voice whatever in the administration of the funds. The period seems to me to be excessive, and quite too long and unnecessary. I think an earlier period than that should be decided upon. The powers entrusted to the provisional committee are very far-reaching, and as far as the Oireachtas is concerned there is no control over the rules, regulations and arrangements they make. The well-being of the members will be to a large extent governed by what they do during that period.
In regard to centralisation, I think that would be rendered necessary in the long run by the force of circum stances, but I hope, as a result, that there is not going to be a hardening of the attitude of the societies towards members applying for benefit. The general experience has been that the bigger the society the more difficult has been the task of members generally entitled to benefit getting it. Delays, objections, and very unnecessary restrictions have been, in many cases that came under my notice, imposed on members, and a considerable amount of hardship has resulted. I am afraid that the tendency will be towards a development of that hardness. Considered from that point of view it is not going, to that extent, to benefit the individual member.
At this stage I want to say a few words with regard to the question of compensation for the employees of existing societies. Presumably this Bill is brought in in the interests of the insured members, and, to that extent, in the interests of the community. Employees who have worked these societies, some of them exceedingly well and efficiently, have certain rights to compensation for the livelihood that is being torn from them. In the Bill the Minister has decided on a form of compensation that I, at all events, have never seen embodied in any Bill. It is a complicated and meaningless form of giving compensation, and takes the form of a gratuity of a limited sum, irrespective of the services. Let us see how it works out. Take the case of a man who has 20 years' service with an approved society. If his average salary was £200 for the last five years, the total amount he is entitled to is a lump sum of £1,000. He cannot very well hope to get employment outside in the present state of industry, so he must try to live on that £1,000. If he invests it in present-day conditions, he will be very lucky if he can get £35 per annum upon which he will have to live. Take the Railways Act, and the Railways Bill which we passed to-day, where compensation is given to a man with the same service and with the same salary. He would get if rendered redundant a pension of £100 a year for life. No member of this or the other House will say that that is an extravagant amount of compensation. Moreover the railwayman will have his compensation based on his salary for the last year, and rightly so, because it is what you are depriving him of, and not on what a man had three years ago or five years ago that compensation is given. The salary ought to be that during the last year, and presumably that is a salary that would continue to increase. Under this Bill it is proposed to take the average salary for the last five years, so that although a man might retire on £200, the actual salary upon which his compensation would be based might be £170 or £180. There is no arbitrator. If the man is not satisfied, or if he raises any question regarding compensation, the Minister is to decide. For very obvious reasons that is a most unsatisfactory type of arbitrator. Under these circumstances I do not think due regard has been had to the rights of the men, some of whom have given the best part of their lives to this type of employment, who are now being deprived of that employment in communal interests, and left pretty well to starve. The majority of them will have just enough to get on for a couple of years and then must fend for themselves. Instead of doing what was done in most amalgamations, the whole of the employees of the amalgamated unit becoming in the first instance employees of the new authority, in this case everyone is dismissed the moment the transfer takes place. The wording of the section is:
the services of all persons engaged in the administration of health insurance business carried on by such society shall be terminated.
A start is made by dismissing everyone immediately on transfer and then considering taking on some. In relation to amalgamation what happens is this, that every employee of the old company becomes automatically an employee of the new company, until the management looks around to see what staff is required. They know the most suitable of the existing staff they had working under them and what they were able to do. They retained as many as they found necessary and discharged and compensated those for whom they had no work. On general principles that would be a more satisfactory line to go on than this drastic method of dismissing everyone and then letting them go and fight for compensation. If there is a dispute they can go to the Minister from whom there is no appeal on a question of law to the courts. I think this is an exceedingly drastic way to deal with men who have just the same rights as railwaymen or anyone else.
There are a number of part-time employees, however, for whom there is no consideration, unless they can show that their income from this business was their principal means of livelihood. In other words if a man was drawing £80 from some employer, and drawing £75 from a national health insurance approved society, he could get no compensation because insurance work was not his principal means of livelihood. Some people have been able to carry on with what they got from the insurance society, and from other employment, but neither salary alone was sufficient to enable them to make a livelihood. If a man loses one employment now he gets no compensation. I agree that some secretaries of societies could very well afford to live on the salaries they got from some other employment. Presumably it is in order to get at those people that some very worthy employees are going to be hit. It would be better and it would make it easier in other directions if the deserving were not punished in order to get at the undeserving cases. I hope that when amendments are tabled the Minister will receive them more sympathetically than he did in the other House.
I move the adjournment of the debate.
Cathaoirleach
As there is no other business for to-morrow I think we might finish this Bill to-night. Do you wish to speak Senator?
No.
I am sorry I was not here for the opening of this debate. I was engaged elsewhere. I gather that Senator Dowdall suggested that the Bill was unnecessary, and that national health insurance could very well have gone on as it was. If I may say so, I think the Senator can hardly have realised the position in which a considerable number of societies were. It is certain that if the present system continued a number of societies would have found themselves in the position that they could not pay benefits and, for all practical purposes, they would go bankrupt. They could not meet their obligations.
A relatively small minority of societies.
A very considerable number of persons would perhaps be victimised.
I do not wish to interrupt the Minister. The figures which I have got, and which I think are fairly accurate, show that 53 societies had a substantial surplus on the 1928 valuation.
That is so, but as the Senator is aware, the figures since 1928 have not improved. Since 1928 the tendency has been for societies in deficiency to get worse and worse, and for other societies unfortunately to join them. The anticipation was that by the end of this quinquennial period, when the next actuarial valuation was made, the societies in deficiency would be more numerous and that the whole condition would be bad. We were faced with such a position that we had to take steps to secure that everybody entitled to go into national health insurance and who wished to do so would be secured the benefits they are entitled to under the Act. We had to do that—any Government that would be here would have had to face that position. I frankly admit that I have not had very considerable experience of national health insurance myself, but anyone in my position has to take the advice of those who are and have been from the beginning closely associated with national health insurance work. We debated this matter over a long period with the officials concerned. This Bill is the result of our discussions with them. We had a full investigation into the whole circumstances. We decided first of all that it was absolutely necessary that a step of this kind should be taken. Then we discussed the lines on which we should go, and these are set out in the Bill. No doubt on the Committee Stage Senators will suggest amendments. Perhaps they will improve the Bill, but that remains to be seen. I myself think that the Bill as it stands is as good a measure as we can get, but that does not preclude me from saying that every amendment put forward will receive my earnest consideration. I will be happy to receive any suggestions that may improve the Bill in any direction and make it a more useful instrument for doing the work of national health insurance in this country and of ensuring that everybody entitled to it will be secured their benefits.
We have not, as was suggested by Senator Johnson, yet drafted the rules. There have been rough drafts made of the rules but they are by no means complete. As Senator O'Farrell suggested, the unified society will not be brought into existence for three years after the passing of the Bill. It will take considerable time to bring in all the societies. During that time there will be a provisional committee. It will be one of the duties of that committee from the time it is appointed to give consideration to the question of the rules that will govern the societies. Of course societies that have not been taken in will continue to be governed by their own rules until they are taken over.
What rules will govern the societies taken in during the interval until the unified society comes into existence?
The rules drafted by the provisional committee. We have the heads of these rules drafted for them. The provisional committee will be composed of experienced people. They may want to draft their own rules. We have suggestions to put up to them, and if they adopt those suggestions well and good, but the responsibility will be on the provisional committee.
The Minister has stated that the unified society will not come into existence for three years.
Cathaoirleach
The Minister is closing the debate, Senator, and we cannot have any further speeches at this stage.
I simply want to ask the Minister a question.
Cathaoirleach
The position is as I have stated, Senator, that the Minister is closing the debate.
In view of the fact that the Minister was not present to introduce the Bill I think, sir, that your ruling is too stringent. I think Senators should be allowed to ask questions so that the Minister may be able to answer some points enunciated by the Parliamentary Secretary when he was speaking.
Cathaoirleach
The procedure on the Second Stage of a Bill is that the Minister in charge of the Bill opens and closes the debate. After the debate has been opened, each Senator can speak once; and any Senator who has given proper consideration to the Bill beforehand should be in a position to embody in his speech such questions as he desires to raise, so that the Minister may reply to them in his closing speech. This procedure is designed to obviate endless questions being put to the Minister on any stage of a Bill. Procedure of that kind would lead to a great waste of time in the House and would tend to the unsatisfactory conduct of debate. As regards Senator Dowdall's point that there has been a change in the handling of the Bill: it was introduced by the Parliamentary Secretary and the Minister is closing the debate. If the Senators see that any inconvenience is caused by that procedure, then certainly as far as my powers go I will allow questions to be put, but the position is that I am bound by rules of the debate. These rules are very explicit. A Senator may speak only once on the Second Stage of a Bill. I am bound by that. If the rules are to be broken indiscriminately by Senators standing up to ask questions every time they occurred to them it would lead to a great waste of time.
The only point I wish to deal with is this. The Minister said the unified society could not come into operation for three years. I would like to have that confirmed, because it is laid down in the Bill that the Minister may by order appoint a day for that not more than three years after the date of the passing of the Act. Three years is the extreme limit, and I hope that provision will be made use of. I hope that this measure will not come into operation for three years.
Cathaoirleach
The Senator, by reading the Bill, can get that information for himself. The Minister will please continue.
Of course the unified society will not be complete until the last approved society has been taken over. We have put in the limit of three years, but I hope it will not require three years to do that. I doubt if anybody can say what time it will require. I hope it will not be three years. We had to put in some period and to allow enough time to the provisional committee to do its work properly so that there would be nothing to regret afterwards. For that reason I am not in a position to satisfy Senator Johnson, who wishes to see the rules of the society before the Bill is passed. It is not in the province of the Minister to draft these rules. That will be the duty and the responsibility of the provisional committee. We certainly have rules in draft, but we cannot say that these will be the rules of the unified society until they have been adopted by the competent authority.
Senator Johnson also raised a question about the local committees, and pointed out, and rightly so, that there is nothing in the Bill to prevent that. It is quite possible that local committees will continue their work. We have an idea of having whole-time agents, men of experience in the work, in all parts of the country whose duty it will be to know every individual on their list. They will be given just as many people to look after as they can properly look after as whole-time people. They will have personal knowledge of every one in their areas. They will be in intimate touch with them. The agents will be in convenient places for the people, and will do the work probably as well as, some would think better than, the local committee. At any rate, there is nothing against the local committee. If the unified society and the members of the committee of management think well of it, we certainly would not put any obstacles in the way of local committees doing similar work to what they have been doing in the past.
Having regard, a Chathaoirligh, to the ruling you have given, may I ask if it would be in order to ask the Minister to comment on the fact stated by the Parliamentary Secretary that some measure of this sort was recommended after investigation by a committee as long ago as 1924? Would the Minister also tell me, on the figures given by the Parliamentary Secretary, if the benefits to insured persons increased by £247,000 between 1923 to 1928?
Cathaoirleach
If the Minister is in a position to give that information, then he can do so.
There was certainly a committee appointed in 1924. It examined over a considerable period the whole question of national health insurance. My recollection is that it recommended unification.
But things had not begun to get bad then.
Well, there certainly were complaints.
And there will be complaints when this Bill is passed too.
I do not suppose that the Seanad even could produce an absolutely perfect organisation. There were complaints, and it was not for nothing that the Committee of Inquiry was set up. I think it is generally agreed that the general unemployment that has developed in recent years has had a very bad effect on national health insurance: that people have been making use of national health insurance for unemployment purposes when their unemployment benefit had run out. That, possibly, is one of the causes of the very heavy drain on the resources of quite a number of societies. Then there is another aspect of the case that I think was bound to come to a head sooner or later, and that is, that it is the belief of many people of experience even in insurance matters— I speak with respect to Senator Dowdall—that this manner of dealing with national health insurance is not a national way of dealing with it.
As Senator Johnson said to-day, you have here a system which allows individuals to be insured by dividing them into classes, and that makes it entirely uneconomic and improper from an insurance point of view. You have them divided into classes and communities, a system that must be uneconomic, and cannot ever be put on a proper financial basis. That is so with regard to a certain number of the approved societies that are now working the national health insurance. We are almost bound to have a very much heavier drain on some classes of the community because of the nature of their occupations, and because societies can select the lives that they insure under the national health system. That is a wrong system, even judged from the purely insurance point of view, and the principle that governs all ordinary life insurance and ordinary fire insurance. The risks are selected in a way that makes certain classes of lives entirely uneconomic. It is to remedy that state of affairs, as well as to face the difficulty caused by the financial failure of some approved societies, that this Bill was introduced.
Is it in order to ask a further question?
Cathaoirleach
We shall be here until midnight if the Minister is to answer every question which Senators wish to put to him.
There was a motion to adjourn the debate.
Cathaoirleach
I must observe the Rules of Order.
I merely want to know how many people will be thrown out of employment as a result of this measure.
Cathaoirleach
The Senator will get ample opportunities of getting information on the Committee Stage, if he puts down an amendment. I am very sorry that I cannot allow the Senator to intervene now, but it was in the power of the Standing Committee to make this rule of order, and that rule I must observe. I called on the Minister to close the debate, and when the Minister had done so, Senator Dowdall asked for permission to put a question on this specific point which the Minister has answered. It would alter the whole course of the debate if I allowed any further questions.
I am not questioning your ruling.
Question—"That the Bill be now read a Second Time"—put.
I wish to be put on record as dissenting.
Cathaoirleach
I do not think that can be done except by the machinery of a division.
In that case I challenge a division.
Cathaoirleach
How many Senators want a division?
Mr. Dowdall rose.
Cathaoirleach
As only one Senator desires a division, it cannot take place.
Question declared carried, Senator Dowdall dissenting.
I move:—
That a Select Committee of seven Senators, of whom four shall form a quorum, be appointed to consider and take evidence upon the National Health Insurance Bill, 1933, with power to send for persons papers and records and to report its opinion for the information and assistance of the Seanad.
I think that the debate fully justifies this motion. The matter is distinctly complicated. Senator Johnson has asked for a lot of figures. Senator Dowdall has challenged certain figures given by the Parliamentary Secretary, and further figures have been given by the Minister. The whole matter is far too complicated for the ordinary full Committee of the House. I, accordingly, move the motion.
I second.
Would the Seanad not require notice of this motion?
Cathaoirleach
It does not. The motion is quite in order.
If I may say so, I think the motion, if carried, would probably mean a very considerable delay in passing the measure. If the Seanad were to set up a real thoroughgoing committee to inquire into this matter, the committee could easily spend six months or a year investigating it. I do not know how long this body would occupy in investigating national health insurance, generally, and the conditions of the various approved societies, but a considerable time might be spent, perhaps some would think spent with advantage.
I would point out that those who have had charge of this matter since the foundation of national health insurance, who were actually in control of it, as far as some of the individuals were concerned, all the time, have already investigated it. There was a committee appointed in 1924. We have had the officials, who have been in charge ever since, watching the progress of the scheme and it is as a result of close investigation and a close watch on the trend of events, in so far as national health insurance is concerned, and of the untoward development, financially speaking, of certain societies that this Bill has been brought in. We do not say that the matter is immediately urgent but it is fairly urgent and one that requires handling at the earliest possible date. We think that the sooner the unified society is brought into existence, the sooner national health insurance will be put on a sound basis for all parties concerned. The longer the matter is delayed the greater the risk will be in so far as quite a number of societies are concerned. I would urge the Seanad to assist us in putting national health insurance on a proper footing at the earliest possible moment. I do not think the Senator's suggestion would help towards that end.
I suggest that the Seanad might meet the Senator's objections by putting a time limit to the deliberations of the committee.
I am prepared to accept a time limit but really the Minister has told us that it is going to take three years to carry all these provisions into effect. Many of them do not require statutory sanction at all and surely concurrently with this investigation the Minister could make these arrangements. I think we shall require a committee in order to satisfy ourselves in regard to all the details of this measure which is so involved.
Standing Order 56 says:—
The Order of the Seanad setting up a Special Committee to consider a Bill may fix a date upon which the Committee shall report back to the Seanad.
I think that the suggestion of the Senator that a time limit should be fixed is quite reasonable. I would make that time limit very short.
Fourteen days.
Oh no, I would say a month.
My idea was that the Committee should report within a month.
I do not wish to place any obstacle in the Minister's way. I have some reasonable doubt in regard to the figures read out by the Parliamentary Secretary and I suggest that we should get an opportunity of verifying these figures. I suggest that the Committee be asked to report within three weeks.
Cathaoirleach
The motion now stands:—
That a Select Committee of seven Senators of whom four shall form a quorum be appointed to consider and take evidence on the National Health Insurance Bill, 1933, with power to send for persons, papers and records and to report its opinion for the information of the Seanad, the Committee to report by June 28th.
Who will select this Committee?
The Committee of Selection.
If we are allowing the Committee only three weeks to report the Committee of Selection will have to meet very soon.
Cathaoirleach
It can meet on Saturday next.
Motion put and declared carried.