Skip to main content

Building Trade (Payment By Results)

Volume 438: debated on Wednesday 18 June 1947

The text on this page has been created from Hansard archive content, it may contain typographical errors.

Motion made, and Question proposed, "That this House do now adjourn."—[ Mr. Pearson.]

12.53 a.m.

I make no apology for raising this matter at so late an hour, because this is an important subject, and the reason that it is raised is because the building industry, at, the moment, has a deplorably low output. Furthermore, an Incentive Committee, which has been sitting for many months, has not yet made a constructive report. The first question to answer is whether payment by results does really bring about an increase in production. I submit that it does, and I make that submission because the experiences of two employers of building labour have proved, beyond all doubt, that output does increase when payment is allied to results.

I refer to the experiences of Lord Quibell and also to the experience of my own firm. I take Lord Quibell's firm first. Lord Quibell has a building firm in the North of England and they were helping to erect 200 semi-detached houses at Scunthorpe. Lord Quibell has been a bricklayer himself and is a trade unionist of about 40 years' standing. On 1st June he wrote an article in the "Sunday Express," and I propose to quote from that article. It stated that when bricklayers were paid the trade union rate of 2s. 6d. an hour they probably laid 250 bricks a day Some of them did better, but on the average it was 250 bricks a day. When paid by results the output increased from 250 bricks to 750 bricks a day, while the wages of the men were doubled They went up from about £6 on time rates to £10 or £12 on piece work. Therefore, in Lord Quibell's experience, the men received twice the wages and produced three times the output in the same time. Lord Quibell wrote:
"When I say payment by results is a practical solution to a desperate problem, I am not making airy theories or trying to introduce something new and revolutionary, harming the trades unions and prejudicing the workers…I do not understand why there should be cavilling about such a common sense measure."
As to my own experience Experiments were carried out on two sites in the last few months. They were experiments in brickwork Now there are many types of briekwork—4½ inch, 9 inch, 14 inch, 22 inch; and the bricks can be pointed on both side or on one side only or left rough on both sides. This experiment was inch brickwork left rough both sides. I will compare the results on one site where the men were paid time rates with the other site where the work was done by a bricklayer who was made a sub-contractor so that in effect he was paid by piece rates. On time rates the men laid an average of 63 bricks an hour, taken over a period of two to three days. On the piecework basis the men were laying an average of 103 bricks an hour, or 40 bricks an hour more on the average than when working on time rates. That means to say two bricklayers paid by piecework rates average between them 206 bricks an hour while three Prick-layers paid by time rates will lay under 200 bricks an hour. It really boils down to this—both experiments, which had been carefully checked by stop watches and the work measured, showed that three men on time rates are needed to produce slightly less output than two men on piecework rates. That evidence was calculated fairly and dispassionately, and shows that output definitely increases when payment is related to output and not merely to attendance.

At the present moment the building industry is at a very low ebb, in fact the lowest for many years. The industry is certainly not a credit to this nation at the present moment. I would almost go so far as to say it is a disgrace to the country, because of the appallingly low output. So I venture to address some remarks to the four parties connected with the industry and I will try to make some constructive suggestions. I should not like to throw the whole of the blame at the door of any of the four parties. The four parties referred to are the Government, the trade unions, the employees, and the employers. I think is is a combination of circumstances which has made output so low, and all four must take their share of the blame.

First, may I make a reasonable request to the Government? That is that Defence Regulations 56AB should be suspended or amended. Regulations 56AB make it an offence for an employer to pay bonus rates to the men. It is keeping output low by prohibiting the men receiving more than the wage rates agreed for a particular area and they are agreed on a time basis. I am going to request the Government to remove or amend that Regulation as quickly as possible for this reason. An Incentive Committee has been sitting for many months. They have really come to no conclusion at all, and unless the Government give some sort of impetus to these negotiations there will be no chance of payment by results being adopted throughout the industry. Generally speaking, the Government have been fairly timid in their approach to the wages question. The other week the Parliamentary Secretary to the Ministry of Labour refused to take any responsibilities for wage negotiations. I think if the Government had frozen wages, as they have done in the building industry. It should really be their responsibility if output is not increased by reason of that Regulation being in force. To my mind it they do not remove it quickly, it will be nothing more than invincible inertia, at its most invincible.

I want now to say a word to the employers, of whom I am one. There is a very bad history in the building trade of relations between the men and the employers, and that is not necessarily the fault of either party. The trade is a difficult one, and the work takes place in the open under bad conditions. In the past there is no doubt about it the men have been worked very hard by certain types of piecework and they have resented it. I am sure the employers will have to lead in this industry, because they are presumed to be the leaders of the industry. They have more intelligence and more drive, and they have achieved more material prosperity than the employee. If they do not give the lead, they cannot expect the men to do so. I would urge the employers in the building industry to do several things. First, I should like to see them have joint consultations throughout the industry in a big way, particularly on sites. If these joint con- sultations do not produce immediate results, I hope the employers will not be disheartened, because it will take a considerable amount of time for the men to get their accumulated grievances off their chests. Second, I think the employers ought to disseminate information to the men as to what is going on. My hon. Friend the Member for Maidstone (Mr. Bossom), who has great experience in the building industry, will support me in that point.

At the moment the men are nearly always working without sufficient knowledge of the objective the management have in mind. They should have information presented to them in a lucid and clear manner. Most people when selling products today spend a tremendous amount in advertisng their wares, and I think the employers will have to "sell" information on the site to the employees if they want to improve conditions. Also, the employers ought to adopt more modern methods, not only of construction and production in the technical sense, but more modern methods of management and organisation. At the present moment in the building industry the organisation is what might be called pretty rough. They ought to remember that men are human beings and, therefore, more emotional than logical. They ought to remember as well that the men have accumulated grievances over a period of years and that they need careful and sympathetic handling before they will respond to any sort of joint consultation.

Now a word to the trades unions, Rule 12 (1) of the general rules of the National Federation of Building Trades Operatives reads as follows:
"Piecework. The plain-time rate method of payment constitutes a vital and well-established principle of the Federation, and the Federation Branch is the guardian of the principle. Should the piecework or any other deviation from plain-time rates operate the Federation Branch should at once write the affiliated branches with a view to an immediate withdrawal of labour for the enforcement of plain-time rates, and should further write the Regional Secretary for his attention, if necessary, to the matter."
So by the very constitution of the union they are committed absolutely, and committed up to the hilt, to time rates, and to time rates only. This has been further confirmed for they have expressed unalterable hostility to any system of payment by results. This was expressed in a recent resolution moved by the National Union of Building Trade Operatives. These are the very people who are sitting on a committee to decide whether or not the industry shall have payment by results; they have really made up their minds a long time ago that they will not have it. I would ask the union in all reasonableness to remove this rule and to face the future instead of continually facing the past, although I know they have had a very bad time in the past in the building industry. My other request to the union is to ask them to make an experiment. Would they take, say, half a dozen building jobs and allow three of them to be on payment by result rates and the other three on piecetime rates and have the full operations analysed objectively and dispassionately, carefully measured and the results put to the world at large?

I would like to turn for a moment to the paid officials of the union and I would refer particularly to the secretary of the National Federation of Building Trades Operatives—the rather stubborn Mr. Coppock. I have a good deal of sympathy with Mr. Coppock. The unions were originally started for the express purpose of bringing pressure to bear on the employers and obtaining higher wages, shorter hours and more leisure. These are the results that they want and they require results from their officials. Now, if those officials do not produce those results then clearly they will dismiss them and get other officials. For that reason I do not think too many harsh words should be spoken against union officials in general and Mr. Coppock in particular. But the problems of the unions is a very grave one for the country, not only in the building trade but in other trades, too. The problem is to turn them from destructive poachers into constructive gamekeepers. It is not an easy task to get the unions to be constructive.

Some of the unions, however, are certainly not helpful on these problems. They still want shorter hours and higher wages. Others are very helpful. The building unions have not assisted very much. I appeal to the unions, and to the union officials particularly, to help the country and the employers and to try to get some spirit of co-operation into the industry and to see if we can get a system of payment by results. At the present moment output is deplorably low and getting lower, and if we are not frightfully careful it will sink the nation because the heavy costs of housing and constructional work will be too heavy a burden for the country to bear. The Government have a big responsibility here and so have the employers, but the Government have most of the responsibility. The best way they can contribute to speeding building operations is to remove or amend Defence Regulation 56AB. Production in the country generally is low, and in the building trade very low. The way the country is going in economic affairs can best be summarised by a note Mr. Balfour once sent to the Soviet Union in which he said:
"Mr. Balfour has never doubted the complete efficacy of the Soviet system for making rich men poor. It is, in the more difficult, and, in Mr. Balfour's opinion, the more important task of making poor men rich that failure is to be feared."
Unless the Government take some sort of firm, determined, bold action that quotation may well be their epitaph.

1.10 a.m.

I am sure that those who are left in the House are very grateful to the hon. Member for Wallasey (Mr. Marples) for the reasoned way in which he has raised this intricate and difficult subject. He has dealt with three matters: First, the general problem of productivity in the building industry and the labour force in it: second, the more specific question within that of payment by results as a method of raising that productivity; and third, and most specifically, the removal or amendment of Regulation 56AB to clear the way for what he believes to be the right policy. In the time that is available to me I should like to say a word on each subject.

On the subject of productivity, there is no dispute that productivity is lower than before the war in the building industry and that it is in the interest of us all that it should be raised. At the same time I must lay emphasis on the fact that this is not to be attributed wholly to any change in the attitude or application of the workers in the industry. It is unquestionably due to shortage of materials and, above all, to the uneven flow of their supply to contractors on sites. I should like to call attention to the evidence that exists that, where two conditions are fulfilled, first, that the supply of materials is reasonably even and easy, and, second, where there is bold and active foremanship, prewar levels of productivity have been reached or at least nearly reached. Perhaps the hon. Member would excuse me if I quote from my own experience.

In my constituency there has been a long and successful record of direct house building and work has been commenced early and pursued with great expedition since the end of the war. There the levels of productivity are above 90 per cent. of what they were in 1938. I have information from contractors that where those two essential conditions are fulfilled—free supply of materials and competent skilled leadership and foremanship—then similar results can be obtained.

I come to the question of payment by results. Here I should like to make it clear that, of course, the Government are in favour of any system of remuneration or reward that will increase productivity or efficiency. They stated that in the White Paper making an economic survey for the current year, in which they said
"The Government attaches great importance to the introduction of systems of payment and other arrangements which provide the maximum incentive to increase output."
On the question of payment by results in the building industry, I am sure we should be in agreement that such a system cannot possibly produce results unless there is reasonable understanding of them and reasonable willingness to work under them on the part of the labour force to whom they are to be applied. Therefore, there can be no question of the Government imposing any such system upon the building industry or any other industry. That would be wholly contrary to the principle for which we stand, that methods of remuneration and payment conditions should be negotiated between the responsible bodies in this, as in all other industries.

What, then, is the Government's responsibility in this field? I think it is plainly threefold. In the first place, they must press for any reasonable system of rewards that will in fact -ïncrease output. In order to get that, as I have said before and applying it again to this point, it is necessary to secure the free and willing co-operation of the workers. The Ministry of Works did submit to the Incentives Committee evidence arising out of its ex- perience of operating a payment-by-results system during the war. We have, therefore, placed at the disposal of the committee—if my information is correct—and made available to them all the information we had in the field of the operation of such a system during the war. That is the first obligation and it has been discharged.

The second obligation is to ensure that the necessary raw materials are there, because it would be of no use either to the workers in the building industry, or to those who need houses or other forms of building, or to the country at large, if a method of increasing efficiency were adopted and the raw materials were not there. The only consequences of this would be that the men would be working themselves out of a job. So the responsibility rests plainly and squarely with the Government to do all it can to see that the raw materials are in ample supply. This is another subject, and I cannot begin to cover the activity and the record of the Government in these fields. We are pressing the clay industry for the production of the necessary supplies as hard and as fast as we can. That is the second essential obligation of the Government.

The last point arises, as the hon. Gentleman rightly emphasised, on the obligation of the Government to consider the provisions of Regulation 56AB. Here I am sorry—though it is a little late—that I must ask the House to bear with me in making two points. It would be a mistake to suppose that 56AB is concerned only with the conditions of payment. It contains three important parts and serves three essential purposes: first, the registration of the builders; second, the pro- visions governing the terms of reward; and third, the collection of statistics from the building industry. It is, I think, only with the second of these provisions that we are concerned. Now there is a consensus of opinion on both sides of the industry that these powers under 56AB need to be considered and revised. The particular form of the revision is now under consideration. It is, I think, conceded that revision will be necessary and I am in a position to say that within a reasonable period of time an announcement will be made.

Before the hon. Gentleman sits down, may I ask whether 56AB will be amended to allow the various employers to pay a system of bonuses if the man on the site so wishes it.

In the two minutes left I wish to say this. The speech we have just listened to might have been made appropriately two years ago. It is filled with complacency utterly out of place today. The hon. Gentleman the Parliamentary Secretary seems to have no conception at all of the situation facing the country and the demand of the people for houses. If he and his friends cannot produce something showing a little more energy, if they cannot produce more practical proposals, then God help the immediate future for the housewives of this country. It is scandalous—absolutely scandalous.

Question put, and agreed to.

Adjourned accordingly al Twenty-one Minutes after One o'Clock.