Speenhamland system

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The Speenhamland system, also known as the Berkshire Bread Act[1] was a form of outdoor relief intended to mitigate rural poverty in England and Wales at the end of the 18th century and during the early 19th century. The law was an amendment to the Elizabethan Poor Law. It was created as an indirect result of Britain’s involvements in the French Revolutionary and Napoleonic Wars (1793–1815).[2]

Operation[edit]

The system was named after a 1795 meeting at the Pelican Inn in Speenhamland, Berkshire, where a number of local magistrates devised the system as a means to alleviate the distress caused by high grain prices.[3] The increase in the price of grain may have occurred as a result of a poor harvest in the years 1795–96, though at the time this was subject to great debate. Many blamed middlemen and hoarders as the ultimate architects of the shortage.[citation needed]

The authorities at Speenhamland approved a means-tested sliding-scale of wage supplements in order to mitigate the worst effects of rural poverty. Families were paid extra to top up wages to a set level according to a table. This level varied according to the number of children and the price of bread. For example, if bread was 1s 2d (14 pence) a loaf, the wages of a family with two children were topped up to 8s 6d (102 pence).

The first formula was set at a time of high prices and possible over-charging, minimum wage inflation was deliberately muted compared to price rises. If bread rose to 1s 8d (20 pence) the wages were topped up to 11s 0d (132 pence). In this quoted example in percentage terms, a 43% price rise led to a 30% wage rise (wages fell from 7.3 to 6.6 loaves).

The immediate impact of paying the poor rate fell on the landowners of the parish concerned. They then sought other means of dealing with the poor, such as the workhouse funded through parish unions. Eventually pressure due to structural poverty caused the introduction of the new Poor Law (1834).

The Speenhamland system appears to have reached its height during the Napoleonic Wars, when it was a means of allaying dangerous discontent among growing numbers of rural poor faced by soaring food prices, and to have died out in the post-war period, except in a few parishes.[4] The system was popular in the south of England. William Pitt the Younger attempted to get the idea passed into legislation but failed. The system was not adopted nationally but was popular in the counties which experienced the Swing Riots during the 1830s.

Criticisms[edit]

In 1834, the Report of the Royal Commission into the Operation of the Poor Laws 1832 called the Speenhamland System a "universal system of pauperism". The system allowed employers, including farmers and the nascent industrialists of the town, to pay below subsistence wages, because the parish would make up the difference and keep their workers alive. So the workers' low income was unchanged and the poor rate contributors subsidised the farmers.

Thomas Malthus believed a system of supporting the poor would lead to increased population growth rates because the Poor Laws encouraged early marriage and prolific procreation, which would be a problem due to the Malthusian catastrophe (where population growth would exceed food production);[5] however, food production actually steadily grew by a third between 1790 and 1830 albeit with a smaller section of the populace able to access it due to mechanization,[6] and the population growth that actually happened was due to growing demand for child labor and not Speenhamland.[7]

David Ricardo believed that Speenhamland would create a poverty trap, where the poor would work less, which would make food production fall, in its turn creating the space for a revolution;[8] however, the poverty that existed back then was not caused a supposed Speenhamland "poverty trap", as "wage earners were permitted to keep at least part of their allowances when their earnings increased", but instead was the result of price hikes resulting from England returning to the gold standard, a policy Ricardo himself had recommended.[9]

There was also no unrest resulting from the adoption of the Speenhamland system; this was the result of the adoption of the gold standard and industrialization, which equally affected all the populace in areas with or without Speenhamland.[10]

This system of poor relief, and others like it, lasted until the passing of the Poor Law Amendment Act 1834, which prohibited Boards of Guardians supplementing the wages of full-time workers. This was not always implemented locally as Guardians did not want to separate families in workhouses, and it was often cheaper to supplement wages than operate larger workhouses.[11]

Evidence in the last thirty years shows that the bread scale devised during the Speenhamland meeting in 1795 was by no means universal, and that even the system of outdoor relief which found one of its earliest, though not the first, expressions in Speenhamland was not completely widespread. Allowances, or supplements, to wages were used generally as a temporary measure, and the nature of their execution changed in various regions. Mark Blaug's classic 1960 essay The Myth of the Old Poor Law charged the commissioners of 1834 with largely using the Speenhamland system to vilify the old poor law and create will for the passage of a new one. However, historians such as Eric Hobsbawm have argued the old poor law was still damaging by subsidising employers, and heightening dependency of workers' incomes on local aristocrats.[12]

Historical interpretations[edit]

Speenhamland appears to have been one among many systems of bread scales, but it most likely owes its notoriety to Frederick Eden's The State of the Poor (1797). Eden attacked the system as an impediment to agricultural progress. Though some of Blaug's more drastic assertions may be ill-founded or overly polemical, it appears evident that Speenhamland was by no means a household name, and that since the practice was by January 1795 (the famous meeting was in May) being used in various villages, usually in conjunction with other means of relieving the poor. Because of failed attempts to reform the existing poor law at a national level, the scarcity of 1795 was largely dealt with by innovations in a haphazard way at the local level, and it seems improbable that a national and uniform policy existed.

See also[edit]

Notes[edit]

  1. ^ Hammond, J L; Barbara Hammond (1912). The Village Labourer 1760-1832. London: Longman Green & Co. p. 19.
  2. ^ Polanyi, Karl, and Robert Morrison MacIver. The great transformation. Vol. 5. Boston: Beacon Press, 1957. p.168
  3. ^ Page, William; Ditchfield, P.H., eds. (1924). "Speen with Speenhamland, Bagnor and Benham". A History of the County of Berkshire. Victoria County History. 4. pp. 97–110.
  4. ^ Phillis Deane (1965) The First Industrial Revolution Cambridge: Cambridge Press. p144. ISBN 0-521-29609-9
  5. ^ Bregman, Rutger (May 5, 2016). "Nixon's Basic Income Plan". Jacobin. New York. Retrieved October 30, 2018. Another clergyman, Thomas Malthus, drew out Townsend’s ideas. In 1798, he described 'the great difficulty' on the road to progress, 'that to me appears insurmountable'. His premise was twofold: (1) humans need food to survive, and (2) the passion between the sexes is ineradicable. Conclusion: population growth will always exceed food production.

    "[...]

    "But the Speenhamland system apparently encouraged people to marry as fast and procreate as prolifically as possible. Malthus was convinced England was teetering on the brink of a disaster as terrible as the Black Death, which wiped out half the population between 1349 and 1353.
  6. ^ Bregman, Rutger (May 5, 2016). "Nixon's Basic Income Plan". Jacobin. New York. Retrieved October 30, 2018. Fears of declining food production were baseless as well. Agricultural production experienced a steady upward trajectory, increasing by a third between 1790 and 1830.

    "But while food was more plentiful than ever, a decreasing share of the English population could afford it. Not because they were lazy, but because they were losing the race against the machine.
  7. ^ Bregman, Rutger (May 5, 2016). "Nixon's Basic Income Plan". Jacobin. New York. Retrieved October 30, 2018. The population explosion that so worried Malthus was attributable chiefly to the growing demand for child labor, not basic income [i.e., the Speenhamland system].
  8. ^ Bregman, Rutger (May 5, 2016). "Nixon's Basic Income Plan". Jacobin. New York. Retrieved October 30, 2018. Economist David Ricardo (a close friend of Malthus) was equally skeptical. He believed basic income [i.e., the Speenhamland system] would create a poverty trap: the poor would work less, causing food production to fall, fanning the flames of a French-style revolution.
  9. ^ Bregman, Rutger (May 5, 2016). "Nixon's Basic Income Plan". Jacobin. New York. Retrieved October 30, 2018. Ricardo’s analysis was equally faulty. There was no poverty trap in the Speenhamland system: wage earners were permitted to keep at least part of their allowances when their earnings increased. And the rural unrest that so worried Ricardo was actually a result of price hikes caused by England’s return to the gold standard (which he recommended), not basic income [i.e., the Speenhamland system].
  10. ^ Bregman, Rutger (May 5, 2016). "Nixon's Basic Income Plan". Jacobin. New York. Retrieved October 30, 2018. Recent scholarship also highlights a mismatch between adoption of the policy and unrest; villages with and without the policy rioted in 1830.

    "All English peasants suffered from the return to the gold standard, along with industrialization in the north and the invention of the threshing machine. Threshers (which separate the wheat from the chaff) destroyed thousands of jobs in one fell swoop, depressing wages and inflating the cost of poor relief.
  11. ^ Grover, Chris (September 2015). "Understanding changes to Tax Credits: historical and policy dimensions of wage supplements in Britain". Lancaster University. Retrieved 26 April 2017.
  12. ^ E Hobsbawm and G Rudé, Captain Swing (1969) 50-51. E McGaughey, 'Will Robots Automate Your Job Away? Full Employment, Basic Income, and Economic Democracy' (2018) SSRN, part 3(1)

References[edit]