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considerably from one another. Other district funds have uniform regulations and rates of contribution for all the industries covered, and this type is regarded, particularly by employers in France, as the most satisfactory in the long run, especially as one of the consequences of family allowances may be an increase in the supply of labour in the coming generation, an increase from which all industries would benefit.
Equalisation funds organised on the initiative of the employers have received their greatest development in France. At the beginning of 1920 there were only six funds, but when the Fourth National Family Allowance Congress organised by the Comité des Allocations Familiales 1 was held at Mulhouse at the end of May 1924, it was announced that the number of funds was 151, covering 9,300 establishments with over a million workers.2 In Belgium, since the middle of 1922 twelve equalisation funds on the French model have been formed. It may be added that in addition to the funds set up by the employers, the Belgian Confederation of Christian Trade Unions has recently established a fund for the payment of family allowances in respect of all children, under sixteen years of age beginning with the third, of the permanent members of affiliated unions. This appears to be the only case in which a workers' organisation has established the system of paying family allowances.3
In Holland, several funds have been established either on the initiative of the employers or by means of collective agreements. In Germany, if account is taken of the extensive development of the family allowance system, the number of equalisation funds is very small. This may be due partly to the fact that during the greater part of the period in which allowances have been paid there has been little unemployment, and therefore little danger of discrimination against married workers. Also the allowances them
1 A central organisation set up by the funds for purposes of liaison, research and propaganda. A similar committee has been formed in Belgium.
? For mine workers, for whom in recent years employment has been good, allowances are paid, but no equalisation funds have been set up, while in the case of the railway companies which in a sense effect “equalisation," on account of their size, and of the public administrations, the danger of discrimination against married workers is small, and allowances are paid without the intermediary of equalisation funds.
3 Professor Edgeworth in his article “Equal Pay to Men and Women for Equal Work ” (ECONOMIC JOURNAL, December 1922) suggested (p. 457) that trade unions might, if they so desired, make provision for the children of members, and form equalisation funds. Various trade unions, in paying unemployment benefits to their workers, pay higher sums to those with dependents than to those without.
When unemployment became serious in 1923 and the beginning of 1924, complaints regarding discrimination against married workers began to be made.
selves have generally been small, so that the results from the setting up and maintenance of equalisation machinery would not have repaid the labour and expense involved.
Various proposals have been made, especially in France, in the Commonwealth of Australia, and the State of New South Wales, for making the payment of family allowances and membership of equalisation funds compulsory on all employers. The only country, however, where such a general law has been applied is Austria, where, at the end of 1921, a system of children's insurance was introduced, the payment of allowances out of contributions of the employers being made compulsory and equalisation on a district basis provided. The real value of the allowances became almost negligible in the autumn of 1922, owing to the rise in the cost of living, to which the allowances were not adjusted.
In France, the bill introduced into the Chamber by M. Bokanowski in 1920 had as object the making of the payment of family allowances and membership of a district or an industrial fund compulsory on all employers. The bill was defeated largely owing to the opposition of the employers.1 The Bill brought forward in New South Wales in 1919 by the Holman Administration, and the proposal of Mr. Piddington in 1920 for the Commonwealth of Australia, were similar to M. Bokanowski's bill in that the allowances were to be paid out of contributions of the employers. They differed from it, however, in proposing the setting up of a State equalisation fund.
The New South Wales Labour Government Bill of 1921 proposed the payment of family allowances not out of contributions by the employers, but out of State revenues. The French law of July 22, 1923, provides for such payments in respect of all children under thirteen years of age beyond the third.
Importance of the Amounts Paid Some indications may be given as to the importance of the amounts paid in family allowances, especially in the three countries in which the system is the most highly developed, namely, France, Belgium and Germany. In France at the end of May 1924 the averages of the amounts paid by the equalisation funds then established were 19 francs per month for the first child, 27 francs for the second, 35 francs for the third, and 43 francs for the fourth child. The average monthly wage of an adult workman in France being about 500 francs, the allowances constitute additions to the wage of less than 4 per cent. for one child, about 9 per cent. for two children, about 16 per cent. for three children and nearly 25 per cent. for four children.
1 A law was passed on December 19, 1922, which led to the making of the payment of allowances and membership of a fund compulsory, with minor exceptions, on all employers working on State contracts.
? See A. B. Piddington, K.C., The Next Step, Melbourne, 1922.
The equalisation funds were paying allowances at the end of May 1924 at the rate of over 128 million francs per annum, this constituting some 2 per cent. of the total wage bill of the establishments covered. In the mining industry in certain of the chief districts, the allowances are somewhat higher than those paid by equalisation funds, being in some cases 1 franc or even 1 franc 50 centimes per child per day. During 1923, the total amount paid in family allowances by the mining companies was about 80 million francs, this being about 5 to 6 per cent. of the wage bill.1 The allowances paid in respect of the children of State officials also form a relatively important addition to the salary, the scale from the beginning of 1924 being 495 francs per annum for each of the first two children and 840 francs per annum for other children.
In Belgium, the rates of allowances paid are generally somewhat lower than those in France, the most usual scale of payment being 10 francs per month for the first child, 20 francs for the second, 30 francs for the third and 40 francs for the fourth and succeeding children. In Germany in a number of industries allowances are paid not only in respect of the children, but also of the wife, a practice which is rarely adopted in France or Belgium. Among the industries in which allowances are paid in Germany the amounts are relatively low in the chemical industry, in which the addition in respect of the wife and two children together is only about 3 or 4 per cent. of the wage. In the metal industry the allowances are somewhat higher, and constitute an addition for the wife and two children of about 6 or 7 per cent. to the wage. The addition for such dependents in the case of mine workers is about 8 to 12 per cent. The allowances are highest for State officials and workers, being for the wife and two children about 15 per cent. of the salary in the case of upper grade officials, about 20 per cent. in the case of intermediate grade officials and of manual workers, and over 30 per cent. in the case of officials in the lowest grades. In Austria, Poland, and a number of other countries, the allowances constitute in many cases almost negligible additions to the wage.
1 The higher percentage of the total wage bill in the case of the mining com. panies is accounted for mainly by the fact that there is a larger proportion of adult male workers in this industry than in those covered by the equalisation funds which include, for example, the textile industry, in which the number of dependent children of the workers is relatively small.
The differences in the importance of the allowances in Germany and also in other countries as between one industry and another may partly be explained by the adoption in one industry of a relatively low rate of wages with comparatively high allowances and in another industry of a higher rate of wages but only small allowances; in other words, the greater application in some industries than in others of the principle of distribution according to needs.
Opinions regarding Family Allowances Opinions differ very widely as to the payment of family allowances. “To some the principle appears as a foretaste of communism, to others as a measure of wage economy; to some as the next step of advanced feminism, to others as a brake upon the industrialisation of home life. To many it appears above all else as a sweeping measure of child welfare.” i From the point of view of the opinions of employers and workers in the different industrial countries, a distinction may be drawn between those countries in which the system continues to be applied and those where it has not been adopted or was applied as a temporary measure only. The latter group includes the Scandinavian countries, together with Czechoslovakia, Switzerland and Great Britain, and in these, the employers and workers are strongly opposed to the system. In North America the subject has received little or no attention from employers or workers.
In Germany and various other Central European countries many employers and workers' organisations are opposed to family allowances, and regard them as a temporary necessity during an exceptional period. Among the workers' organisations in Germany the chief opposition comes from the Socialist Unions, the Christian Unions being, as in France, Belgium and Holland, favourable to the principle. The Socialist Unions consider that assistance for those with large families should be provided not by the employers but by the State, not by means of money payment, but by free education, apprenticeship, medical attendance, and the free feeding and even clothing of school children. They are strongly in favour of a wage policy which has as object the securing for all workers of a minimum wage adequate for an average family. They fear that the inclusion of family allowances in the terms of collective agreements will cause a division of interests in the Unions, between unmarried and married workers.1 Similar views are also held by the Socialist Unions in France, Belgium and Holland. In France and Belgium especially, the Socialist Unions were at first opposed to the payment of family allowances, which they regarded as a means of withholding the full increase in wages due on account of the rise in the cost of living; but as the system spread it was realised that, as a large number of workers were actually receiving allowances, it would be difficult to destroy the system, and it was accepted as a fait accompli. Attention was then directed to the methods by which allowances are provided, and strong opposition was raised against those features of the present system which savoured of paternalism or of charity on the part of the employers. Demands were made that instead of being voluntary and organised by the employers, the system should be made compulsory by law, and administered by joint committees representative of all the interests concerned, and that the allowances should be paid either out of State funds on the same lines as insurance benefits are provided for unemployment, sickness, disability and old age, or else out of compulsory contributions of the employers. The allowances should be paid only in the case of families larger than the average and it is considered, as in Germany, that the wage should be adequate for an average family. Opposition is also strong, as in other countries, against the practice in some cases adopted by the employers of withholding the allowances during strikes.
1 The Meaning of Family Endowment, by Mrs. M. D. Stocks, p. 7.
2 For certain opinions in Germany, see an article on “ The Family Wage Controversy in Germany," by Dr. E. Heimann (ECONOMIC JOURNAL, December 1923, p. 509).
The general attitude of employers in France and Belgium is that the system should be allowed to develop without any element of compulsion, their view being that a State scheme would be too rigid and would not allow of sufficient consideration being given to the special conditions of different industries and districts. They believe that a State system would involve complicated administration and control which would be far more costly than the present system. They also consider that the improvement in industrial relations which they claim to be one of the advantages of the present system would be lost if compulsion were introduced. It may be added that the French employers favour the drawing of a clear distinction between the wage or the payment for work done, which is the same for all workers whether married or unmarried, and the allowances which are largely independent of the quantity and quality of the work done. They point out that the allowances are frequently paid independently of the wage, often
1 This division of interests is less serious if the method is adopted of paying allowances in respect of large families only.