NATIONAL INSURANCE

Insurance against unemployment, sickness and old age is now undertaken in many countries by the government and in Great Britain it is under the control of the Ministry of Health and Social Security. A very limited scheme of social insurance existed in Germany as long ago as 1844, but in Great Britain national insurance dates from 1908-1911, Lloyd George being mainly responsible for its introduction. Previously some of the trade unions had provided insurance against sickness and unemployment for their members. In 1929 the scheme was extended to include pensions for widows.

In 1947 a more comprehensive scheme, based largely on the Beveridge Report, and including a wide range of new benefits, was introduced. Retirement and unemployment pay were increased, and the scheme was made compulsory on all but a very few workers. In addition, however, to contributions being demanded from those entitled to draw benefit, compulsory contributions have to be made by employers, and a third contribution is made by the government, which also finds it necessary to bear most of the cost of the health service. It was the intention both of Lloyd George and Beveridge that national insurance should be operated on strict insurance principles-that is, that the amounts paid should be sufficient to cover all payments of benefit. Owing to the continued decline in the value of money since the scheme was introduced, it has been necessary to increase the benefits, especially retirement pensions. Although the contributions have also been increased, this has not no been sufficient to cover the cost of benefits, and since 1964 the government has had to bear an increasing share of the cost. The last Labour Government proposed to introduce a more ambitious pension scheme with greatly increased contributions from both employers and employees.