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Problems Problems
From: Problems: Articles
Date: April, 2012
By: Eamon Dyas

Minimum Wage, Part Two

The Minimum Wage And The Working Class

Part Two: Minimum wage up to the first Labour Government.

Introduction


The first part of this investigation outlined the manner in which the concept of the minimum wage is being redefined in Ireland. It was shown that the idea which has come to dominate thinking on the subject is a different concept than the one around which it was originally formed in pre-First World War Britain. It was also shown that the Irish Parliamentary Party under John Redmond was non-committal on the idea of the minimum wage until it became a practical prospect after the governing Liberal party began to support the idea in 1909. Redmond and the Irish nationalists then adopted a policy of outright opposition which continued until the First World War during which time members of the Irish Parliamentary Party began to articulate a different opinion on the subject.

It was the Irish Parliamentary Party which, by holding the balance of power at Westminster, sustained the Liberal Party in Government from the 1910 general election onward and Redmond, through a refusal to ally himself with the anti-war element in the Liberal Party directly facilitated the declaration of war in August 1914. He did this on the promise that Home Rule would result from such support and then, as the war entered its second year with the prospect of an ongoing war, he added a second line to his pro-war sales pitch on the basis that the Irish economy would gain economically as a result of the war - a so-called “war dividend”. Redmond believed that British government orders with Irish industries would generate significant industrial growth for the country.

However, as things turned out, while some sectors gained from the “war dividend” (notably agriculture and industries of the north of Ireland), the war did not result in any significant programme of investment in the industries of the south of Ireland. Although there were individual examples of large Government orders being placed with some factories (the Kynoch factory in Arklow being the most obvious) Government orders which resulted in any investment of scale were rare and usually reserved for those instances where the Government had no other choice. In the case of the Kynoch factory the pyrites found in the geology around Arklow were easily extractable and of a richer content than anything found outside Spain at the time and given the importance of pyrites to the production of explosives the British Government was compelled to place large orders with that factory. Despite Redmond’s hopes, generally speaking, British investment in Irish industry was kept at a minimum and the war actually hindered, rather than assisted the development of industry in the south of Ireland. This of course need not have been the case. If Britain had treated Ireland with any kind of equality there is no doubt but that southern Irish industry would have prospered. But Britain at the time retained the same imperial attitude towards the country (or at least that part of the country outside the industrialised Belfast hinterland) which viewed it primarily as a source of foodstuffs and labour.

British attitudes on this issue were epitomised by Government reactions to the attempts of Irish industrialists to re-establish a War Office Receiving and Testing Depot in Ireland in the years up to and during the First World War. Such a facility was required to enable Irish manufacturers to compete on fair terms for War Office contracts. A War Office Testing Depot had existed in Dublin up to 1854 when the British involvement in the Crimean War led to its removal with its functions, as far as Irish industry was concerned, being transferred to Woolwich in south-east London. There appears to have been no rational reason for this decision and the general suspicion was that the British Government was seeking to discourage any development of industry in the south of the country that might result from the allocation of War Office contracts. Without that facility Irish industry was compelled to compete at a disadvantage for such contracts. After 1854 any Irish manufacturer who wished to tender for British Government contracts was compelled to submit his tender together with samples of his products to Woolwich. He then had to wait until it was assessed for suitability in terms of price and specification. In those instances where the specification needed altering he was compelled to go through the process again and all the while losing time and ground to competitors on mainland Britain. Also, in those instances where he might be fortunate enough to gain a War Office contract his consignments were regularly examined in the Testing Depot at Woolwich to ensure a consistency of quality and on those occasions where a particular consignment was rejected he was expected to carry the burden of the cost of transporting the consignment to and back from Woolwich to enable rectification or a replacement to be supplied. All of this placed a disproportionate weight on the shoulders of Irish manufacturing and compounded the existing imbalance between small scale Irish production methods and large-scale industrial process on the mainland.

At the end of the nineteenth century a systematic lobbying campaign began in Ireland to have such a facility re-established in the country. The campaign included the Irish Trades Union Congress as well as various business interests and Chambers of Commerce. Yet, despite the handicap created by the absence of that facility, Irish industry was experiencing healthy growth in the years leading up to the First World War. The Land Acts of 1903 were beginning to show dividends not only for Irish agriculture but in the wider economy as some of the surplus capital generated by land reform began to find its way into Irish industry and helped to stimulate growth in that sector until the First World War intervened. The effects of British requirements during the war stopped such development in its tracks. Writing in 1918, Edward J. Riordan, an economist and Secretary of the Irish Industrial Development Association, had this to say:

“Abundant evidence is available to prove that for at least ten years prior to 1914 Irish industries were steadily increasing in number and output, and that the spirit of Irish enterprise was extending its wings wider than in the previous decade. But during the past four years these wings have been ruthlessly clipped. Let us review some of the chief restraints which have been imposed upon our industries.
Since the outbreak of the present War the British Government has acquired control of:-
Raw-materials of practically every kind.
Plant and machinery necessary for the manufacture of all description of products.
Shipping; railways; and canals.
What are designated as ‘essential industries,’ i.e. ship-building; the production of foodstuffs, etc.
Output of industries, and prices or products.
The sanctioning of raising of capital for new undertakings.
Restriction of exports to countries abroad.
. . . . Perhaps the best way to visualize the effects of this system of control is for the reader to imagine for a moment that he is, if he is not, an Irish manufacturer. He possesses a factory and a trained staff of workpeople; his customers place orders with him, as they were wont to do before the War; he requires certain kinds of raw-material, or perhaps plant and machinery to enable him to execute these orders; the sellers of the latter items inform him, as they are compelled to do, that they may only supply his requirements when he provides them with a Government Permit. Consequently, he applies to a Government Department for a Permit authorising him to purchase his requirements, and receives, in return, a set of forms which he must fill up – giving full particulars as to the purpose for which he requires a Permit, if the goods are required in respect of the execution of a Government or ‘essential industry’ contract; if they are not so required, he receives a notification that his application cannot be acceded to. In other words, broadly speaking, his output must be confined to (1) Government contracts; (2) the needs of agriculture; (3) the production of necessary foodstuffs; or (4) the production of ‘essential articles’ – these latter are defined by the Government and have been reduced to almost a minimum number of items. If he is not engaged in producing goods included in these categories, he is left with the alternative of closing his factory, dismissing his workers, and - ?” (Restraint of Industry, by E.J. Riordan. Published in Studies: an Irish Quarterly Review, vol. 7, no. 26. June 1918, pp.307-308).


Thus it was that from the early days of the war Irish industry was subjected to the twin obstacles of the absence of a War Office Receiving and Testing Depot in the country and the increasing regulation of industrial production by the British Government. In October 1916, under pressure from Irish industrial interests to establish a War Office Receiving Depot, Lloyd George took refuge in a totally superfluous commitment to an independent investigation into the need for such a Depot. The investigation was undertaken by Sir Maurice Levy and resulted in the obvious conclusion that the existence of such a Depot would be of significant benefit to Irish manufacturers. Levy’s report was available in November 1916 and yet, the British Government continued to prevaricate and delay until the very end of the war when one was nominally opened in Dublin but too late for its existence to serve any meaningful purpose.

The fact of the matter is that British interests during the war precluded any real effort to encourage the development of the industrial sector in the south of Ireland. Although Britain did require certain things from Ireland these requirements could only be met through the discouragement of industrial growth, the perpetuation of a low paid workforce and a useful reservoir of unemployed labour. Aside from the obvious need of foodstuffs supplied from Ireland, as the war progressed what the British war economy increasingly required was a reservoir of labour available to fill the gaps left in its own industries by the wholesale removal of its workers – something that was demanded by the inexorable growth of its army. While the use of women became the main source by which these gaps were filled there remained important areas where the existence of an alternative source of labour was advantageous. Consequently, from the British point of view it would not be sensible to permit any significant stimulation of industry in the south of Ireland and, as a corollary of that, to permit the emergence of any significant improvement in wages and conditions among the Irish workforce. As the war progressed it was the growing realisation of this and the emerging political threat from Sinn Fein that led some members of the Irish Parliamentary Party to become increasingly vocal in their criticism of the British government for its systematic failure to allocate more orders for Irish produced goods and its failure, beyond some cosmetic gestures, to make any concerted effort to extend the protection of British trade and wage boards to the workers of Ireland. (In 1910 and 1911 individual Irish Nationalist MPs like Thomas Kettle, Joe Devlin and J.J. Clancy had taken issue with the ongoing failure of the British Government to put the 1909 Trade Boards Act into operation in Ireland – a rather ironic position given the role the broader party had played in placing obstacles in the way of the automatic extension of the Act to Ireland – see Part One of this series).

The situation of the working class in Britain was very different to the situation confronting the working class in Ireland. While the war could be said to have led to an increase in the influence of the trade union movement in both Ireland and Britain the factors which generated this development in both countries were in marked contrast to one another. While in Ireland the trade unions were developing their influence through the twin causes of the condition of the working class and a resultant anti-establishment outlook which echoed the growing revolutionary feeling in the society, in Britain the trade unions were extending their influence through the adoption of an increasingly complicit position within the war effort. It was the price which the British establishment was prepared to pay for such complicity that formalised the social influence of the trade union movement in Britain. In Ireland, on the other hand, no such price was required. The British State, in following its interests, adopted policies in Ireland that discouraged the growth of the industrial sector and paid no attention to the trade union movement in the country. It simply went about serving its war interests in ways that brought in their wake the further alienation of the Irish working class from the British State.

In the meantime, in Britain the issue of the minimum wage had been given further impetus by the war and became a measure of the growth in trade union influence in society. Although the concept of the minimum wage continued to have a relevance to the working class in Britain and Ireland it took a different course in its subsequent history in both countries. As the minimum wage first assumed a legal existence in Britain and evolved in its earliest form in the British context it is necessary to examine the route of its development in that environment before embarking on an examination of the manner in which it evolved in Ireland after 1922.