1244

THE COLLIERY GUARDIAN

December 13, 1918.

and paid by the Coal Controller, who receives from
the coal owner 4s. per ton on all saleable coal. All
miners, miners’ leaders, coal owners and managers
with whom the author has discussed the matter have
expressed regret that the bonus was not applied in
the form of an ordinary increase of wage rates and
paid on the ton, the fathom or the shift, as the case
may be. The author entirely agrees, and yet thinks
that, from the Controller’s standpoint, the bonus on
the shift is the only practicable way.

If we accept, then, that the position required a
bonus system, we may now examine how it might be
best applied to increase both output and miners’
wages. The first capital error was in treating Scot-
land and England as one unit. The ideals of the
people, their outlook and their customs differ greatly.
The natural difficulties of the coal fields, and the
methods of attacking the problems of working the
seams, are entirely different. Hence when an attempt
is made to apply some uniform thing to both coun-
tries, such as a system of paying bonus, unending
difficulties arise. In many parts of England the coal-
producing shifts worked twelve days per fortnight.
Again, in other places it Was usual to pay night shift
men six turns for five. In either case the bonus was
directly applicable. In Scotland, however, it was
customary in some places to work ten days per fort-
night, in others eleven days, in pre-war times. During
the war the custom of working eleven days became
usual. The Controller directed that every miner who
worked five days in the five-day week should get six
bonuses. This system of paying for something which
was not done is totally foreign to Scottish custom
and practice, and has caused a great deal of trouble.
A miner who works eleven days gets 36s. bonus per
fortnight, or, roughly, 3s. 3d. per shift, which, added
to the standard wage of 10s., gives 13s. 3d. per shift.
Suppose, now, that a manager asks a miner to turn
out on the idle Saturday to repair his road and so
prepare for coal-getting proceeding smoothly during
the following week, the question arises : Who is to
pay the bonus? The Controller’s position is that he
has already paid for that day, the manager hesi-
tates to pay what he considers it is unjust to ask him
to pay, and the miner, naturally, refuses to work
a shift for 10s. when the trade union rate is in effect
13s. 3d. And now comes the Gilbertian aspect of
the arrangement, for if the manager says to the
miner, “ Take a holiday on Saturday, but come out
and do that job on the Sunday,” the Controller must
then pay the bonus. It might be said that the miner
is fined 3s. if he works on the idle Saturday. In
short, the incidence of the bonus directly reduces
output.

Apart from a minority of Bolsheviks, pacifists and
fainthearts, the author is certain that the miners of
Scotland, if treated properly, will put their backs
into it and increase output at once by 10 per
cent., but the incidence of the bonus must first be
altered. There may be insuperable difficulties in
application, but something of the following nature
should be adopted by the Controller with the permis-
sion of the Treasury, and applicable to Scotland only.

(1)	The twelve bonuses for eleven shifts should be

cancelled, and one bonus should be paid on
every shift, and fractions of bonus for frac-
tions of shifts.

(2)	The bonus should be raised to 3s. 6d. per shift,

of which 3s. would be paid direct and 6d.
deferred.

(3)	When each man’s quarterly income tax return is

compiled, the number of bonus shifts should be
shown, and only those with a predetermined
minimum number of shifts would be eligible
for the deferred 6d., w’hich would be used as
part payment of income tax, and men with
a given number of shifts to their credit should
be entitled to a rebate on income tax.

After conversations with many intelligent miners,
the author finds that feeling is strong in the matter
of income tax. Their view is that the industrious are
taxed, and slackers are not. It must be remembered
that direct taxation of workmen is new in this
country; they may become accustomed to it, but the
feeling is there, and is reducing output. If the
miners are handled sympathetically and with some
regard to their point of view, they will largely throw
aside all their old-time prejudices which regarded the
keeping down of the output per man as the first
article of their economic faith, and will loyally pro-
duce a largely increased output. The next question
is: How would the raising of bonus rates affect the
cost of production? If we assume that for every work-
man employed who receives the 3s. bonus 25 cwt. of
coal are produced, and that the average number of
working days per annum per man is 250, we arrive
at an output per man of 300 tons per annum—a fairly
correct figure. If we deduct from that figure 15 per
cent, for coal used at the colliery and dirt taken out
of the dross in the process of washing, we have an
output of saleable coal of 255 tons per man. Starting
on that assumption, we get the following : 250 shifts
at 3s., 750s. If we add to that 10 per cent, to cover
the extra bonus, we get 750 plus 75s., or a total of
825s., which, divided by 225 (the produce in tons of
250 shifts), gives a minimum cost per ton of 3s. 3d.
It probably in practice costs more. The coal owner
pays the Controller 4s., but the collieries require to
be maintained whether or no the productive men
attend, so it will not be surprising if the Controller
has little or no change left over after paying the
bonus. Now, if the Controller can get 275 shifts per
man per year, the output, without extra daily effort,
would be increased 9 per cent. Is it reasonable to
expect an average of 275 shifts per man per annum?
Every colliery manager will probably agree that it
is. Oncost men generally work a great deal more;
275 days’ work allows 52 Sundays free, and allows
38 days for holidays, illness, accidents, etc. Many
will think even 275 shifts a very low record, but it
must be remembered that in pre-war times about 220
shifts per annum was the Scotch collier’s average.

If the Controller got only a 9 per cent, increase,
how would he then stand? The actual hewing and
hand drawing of coal plus brushing accounts approxi-
mately for half the total cost of production. It
follows that the bonus costs per ton for oncost charges
(taken as 50 per cent, of the total labour cost) would
fall at least 8 per cent., and as the percentage of
fuel used at the colliery would fall at least per
cent., the Controller would probably have 285 tons
of saleable coal instead of 255.

With 275 shifts at 3s. 6d., the cost would not
exceed 3s. 5d. per ton, a saving of anything from
3d. to 7d. per ton. Possibly he fears that the miners
would not expend greater effort or give better
attendance. Even in that case he would win, because
they would not qualify for the deferred 6d., which
would revert to him.

Having a lifelong experience with Scotch miners
and the bonus system, the author is certain of success
on these lines. Earnings would go up, causes of fric-
tion between workmen and manager would be re-
moved, and pit committees would be relegated to the
limbo of forgotten things.

Coming now to the handling of the coal owners
by the Controller, grave errors have been made. The
question bristles with difficulties, but more generous,
and, what is better, more equitable arrangements are
in my opinion possible. As all are well aware, trade
unions generally laid aside their policy and their
privileges for the period of the war, and are, natu-
rally, on the watch lest any step taken during the
war would jeopardise their post-war conditions. So
with the coal owners—they must cast anxious eyes
into the future, and no doubt each has speculated as
to his position and the condition of his colliery for
coal production when control is removed.

Generally speaking, control has meant that the
slacker and the indifferent coal owner have been
treated better than the patriotic and energetic. Take
the case of a prosperous colliery that has raised out-
put by 1,000 tons per week, or, say, 45,000 tons per
annum, and assume that the profit in the pre-war
period was Is. per ton. The reward for this effort
amounts, according to my calculation, to £112. If
the capital of the company is £225,000, the managing
director has the privilege of announcing to his share-
holders that as a result of his great efforts, and with
the loyal co-operation of his staff, the dividends have
been increased by one-twentieth part of 1 per cent.
In this case in pre-war times increased output would
have meant increased profit, but, taking it at the
figure of Is., the profit on 45,000 tons would have
given £2,250, or 1 per cent, on the capital. If the
author were a managing director he would not in
these days make any extra effort except, perhaps,
from patriotic motives, for he cannot see that the
extra effort is worth doing from a financial point of
view. This is not the way to get output. All con-
nected with the industry, whether miners, owners or
managers, should be encouraged to greater effort.

In the case above mentioned the output might fall
15,000 tons below pre-war standard without ill-effect
on the profits. In any case, whatever the effort, or
lack of effort, 9 per cent, is sure as the profits. Old,
exhausted, unprofitable pits are kept open, and work
on new pits that should give ready return is stopped.

Surveying the whole arrangement, one might think
that the coal owners and miners’ representatives, each
mutually distrustful, suspicious, and jealous of the
other, met the Controller., who set about dividing that
he might rule. One might further think that the
Controller invited the miners’ leaders to draft a con-
trol agreement that would bind the coal owners fast,
and that he then requested the latter to retort on
the miners by drafting a bonus system that would
keep them poor and discourage production.

With all due respect to the leaders on both sides,
neither the coal owners’ nor miners’ representatives
go underground daily. Many have not been down for
a long period. They do not understand the practical
everyday little difficulties that arise. Neither of them
understands perfectly the workman’s point of view.
The Controller failed to call in the only body of men
who could clear away the little misunderstandings,
who could guard him against impracticable agree-
ments, who could soften the asperities of the acri-
monious discussion of strong opponents, and who could
guide him past the pitfalls for the feet of the un-
technical, viz., the coll ery managers.

Before sitting down to wages discussions, and before
binding himself by covenants he cannot honourably
alter or break, had he gathered around him a con-
sultative council of experienced colliery managers,
.he would have increased output considerably and
rendered frantic advertisements about pokers unne-
cessary. It is to be feared that even yet he has not
seen the light, judging from the ungracious decision
he gave on the last colliery managers’ application for
increase of salary. In brief, with all due respect, the
author would suggest to the Controller that if control
is likely to last six months longer, he should frankly
re-cast his system on the following lines: —

(1)	Scotland should be treated as a separate entity.

(2)	Bonus to miners and profits to coal owners should

be so altered that the industrious would get
fully rewarded and the slackers would suffer,
even if cost of living is high.

(3)	That colliery managers should be consulted.

The author holds a brief for neither coal owners nor
miners. Desire for increased output is the motive of
his plea.

Increase of Output per Man.

In “ Mining Economics : Some Notes and a Sugges-
tion,” read before the Mining Institute of Scotland
in April 1914,* the author drew attention to the
small output per man in Britain as compared with
America, and suggested, inter alia, that if the
standard of living of the miners could be raised by
better housing, an incentive to greater effort (and so
higher output per man) would be present. It is
probable that the Government will presently attack

* Colliery Guardian, April 17, 1914, p. 842.

the housing problem, which in my opinion is a re-
proach to us as a nation. The great stumbling-blocks
in the way of increased output per man are, in my
opinion : (1) The trade union policy of restricting
outputs with the object of maintaining or raising
prices, and consequently wage rate; (2) the incessant
bickering and squabbling between owners and miners,
arising chiefly out of the above-mentioned policy. As
a nation we throve in spite of that policy, principally
because we were the oldest and wealthiest of indus-
trial nations, because of our unique position as the
greatest shipping and financial nation, and because
our European rivals in mining were not up to our
standard of production per man. All this may now
be changed. The old world that existed before the
war is gone. Values are transformed, we know not how
or to what extent. Is our supremacy in all our old
fields of enterprise still existent? It is only prudent
to assume that they are not; and all of us, miners,
managers and owners, must bury our old prejudices
and pull together as one man. How important cheap
coal is to industry is hardly realised. Industrial firms
in the American coal fields can in normal time buy
coal for perhaps Cs. per ton. Can we approach that?
Probably not, but we must aim at it and strive for
it. Consider how much of the cost of production of
steel and iron goes in coal. Consider how much the
comfort and well-being of the nation may rest on
cheap, iron and steel. Cheap coal is, or soon will be,
a national necessity. How can it be secured?

In the old days owners, through their managers,
fixed on some arbitrary figure as the day’s wage, and
the miner fixed on another arbitrary figure as his
day’s darg. If some miners produced more coal than
gave them the day’s wage, the manager came along
and broke the ton rate, and frequently a squabble
ensued. If some miners earned less at the ton rate
than the day’s wage rate amounted to, an applica-
tion for increased ton rates preceded further
squabbles. We all know the history of the last twenty
years, with its mutual suspicions, its strikes, and
its restriction of output. Cannot we close this
miserable chapter and start anew? As already stated,
the author is of opinion that cheap coal is in the
near future a national necessity; hence if we do
not hang together we will hang separately. There
must be a concordat between Capital and Labour,
and the managers must help to bring it about, and
cheap coal spells hard work for all concerned, keener
management, and loyal co-operation of all hands.

The first step should be to put the regulation of
wages on a different basis and make it so that all
are directly interested in output. In some places in
the United States a bonus system exists by which,
if the output rises, both operator and workman
flourish, and if output falls both suffer. It is doubt-
ful if this is practicable here, but at any rate it is
infinitely better than our system, by which wage rates
are based on selling prices — a direct incentive to
restriction of output. The system suggested is as
follows : —

(1)	The wage rates should be based on profit per

ton. This entails—

(2)	A minimum (or standard) wage rate, and

(3)	A minimum (or standard) rate of profit per ton

(which it is surely possible to fix).

(4)	All ton rates should be registered in the office

of the local conciliation board which would
be set up in each district, and should only be
altered by means of an arbiter’s decision.

(5)	All increases over the standard rates of wages,

which at present are paid either per shift or
per ton, should be fixed by percentages and
paid for, not by increasing the rates as at
present, but should be added to each man’s
earnings as a percentage.

(6)	The manager or his under-manager should, as

at present, be authorised to make the usual
temporary rates for abnormality.

With such a system the following advantages would
be gained : —

(1)	The miner would be sure the higher his output,

the lower would be the cost per ton of output,
the greater the difference between cost of pro-
duction and selling price, hence the higher his
wage rates.

(2)	He would be sure that, no matter how high his

earnings, his rates could not be readily re-
duced ; hence he would fear no ill consequences
following on strenuous effort.

(3)	By paying increases by percentages on earn-

ings, petty squabbles about farthings on ton
rates would be avoided.

(4)	Disputes regarding partial breaks would not

occur.

Is it too much to hope that all restrictions of hours
of labour at mines set up by Acts of Parliament would
be swept away or allowed to fall into desuetude in a
few years? To safeguard juvenile labour by law is
surely a wise and necessary thing; but why should
the hours of labour of grown men, members of
perhaps the strongest trade union in the country, be
restricted unless the object is to restrict the output?
It has that effect, and perhaps was designed for the
purpose. If so, the author would strongly advise poli-
ticians to look up their primers on economics. Does
any colliery manager doubt that the output per man
in Scotland could be raised by 20 per cent. ? If and
when this is done the cost of production will go down,
profits and wages will be high, and industry will get
cheap coal. If strenuous exertion is, under these cir-
cumstances, demanded from the workmen, in the same
degree will the best efforts of the managers be
required. Increased productivity by the men entails
greater skill and energy from the manager.

Apart from the legal requirements regarding safety,
it may be said that the chief end of management is
to produce a plentiful supply of ventilation and empty
hutches at the working face. Having ensured these,
his efforts are chiefly directed towards raising the
percentage of productive and reducing that of non-
productive workers. With this object in view he
introduces coal-cutters, conveyors, auxiliary haulages,