By "surplus profits" is here meant any surplus which may remain over when labour has been paid on the scale referred to above, and managers and directors have been remunerated according to the market value of their services; when capital has received the rate of interest necessary to ensure an adequate supply, having regard to the risk involved, and when necessary reserves have been made for the security and development of the business.

(1) Surplus profits may go to one or more of the following: (a) The proprietors of the business, whether private individuals or ordinary shareholders.

(b) The directors and principal managers, who may or may not be the same as the persons mentioned under (a). (c) The employees.

(d) The consumers.

(e) The community generally.

(2) We cannot believe that either the proprietors or the workers are entitled to the whole of the surplus profits of the business, though they might reasonably ask for such a share as would give them an interest in its financial prosperity.

(3) The consumer should never be exploited. The price charged to him should always be reasonable, having in view the average cost of production and distribution; and the state should be asked to interfere to protect his interests when they are threatened by monopoly.

(4) We believe that in equity the community may claim the greater part of surplus profits. If this is not taken in the form of taxation, we think that it should be regarded by those into whose hands it passes as held in trust for the community. We are not prepared to suggest in detail schemes by which such a trust should be administered. If the profits are taken in the ordinary way by the proprietors, they should be regarded as a trust and spent for the common good, or the proprietors might limit the amount they themselves took out of the business, while surplus profits were put into a separate account, and spent, at the joint discretion of the proprietors and workers, for the benefit of the general public. Our point is that the bulk of them at least belongs to the community, and should be used in its interests.

In this connection we would ask all employers to consider very carefully whether their style of living and personal ex

penditure are restricted to what is needed to ensure the efficient performance of their functions in society. More than this is waste, and is, moreover, a great cause of class divisions.

CONCLUSION

In regard to many of the matters referred to in the preceding pages there is ample room for experiments. Pioneers and explorers, and "the makers of roads," are needed just as urgently in the industrial sphere as in the opening up of new tracts of fertile country. But we believe that if the longing for a better social order once grips the employing classes, such pioneers will not be lacking.

We believe it to be our duty to promote a progressive spirit in the various trade organisations with which we may be associated. In this connection we suggest the desirability of giving full information as to wages, average costs, and average profits in the industry, as a basis for effectual collective bargaining, and as a recognition of the public character of our industrial functions.

Some employer may tell us that we are asking him to draw too many practical inferences from a religious formula. But the conviction we have outlined is more than a formula. It is a vantage ground, from which we can survey the whole field of social and industrial life, seeing in it, not sheer blind turmoil, but a vast meaning and a vast hope. There is but one way of escaping from the implications of such a conviction. to abandon it entirely, to forsake the vantage ground, and to forget the only vision that could dominate our whole lives. Then the world of industry may revert to a soulless chaos in which we strive for our own ends. But those ends, even as we achieve them, will seem meaningless and vain.

Doubtless, to take the other course, and claim for our religious faith the final word upon the problems with which industry confronts us, may tax severely not only our financial resources, but heart, and will, and brain. But is this a disadvantage?

APPENDIX XIV

SHOP COMMITTEES AND LABOUR BOARDS

By ARTHUR GLEASON

(Reprinted from the Survey, May, 1917.)

WHAT is the workshop council? The head of one of the largest cocoa manufactories in the world has sent us the details of his council, as now in operation in the almond paste department. The cocoa business is not the best field for studying workers' control, because the labour is largely female, because the industry is not nationally organised like the building and engineering trades, and because the experiment is only in its beginning. But with a new application of a principle, we have to take it where we find it and push on with the experiment.

The departments of the factory have well defined sections, so each section has a sub- or sectional council. The number of delegates for each sectional council is fixed on the basis of one delegate for every twelve workers (of whatever age) or part of twelve exceeding six, employed in the section. Sitting with these at the meetings of each sectional council and having equal powers with them, are the manager of the department with the head and sub-overlookers, monitors or chargemen of the particular section. Should these, however (including the manager), exceed in number the workers' delegates, the members of the council representing the administration consist of the manager and head overlookers, together with as many of the sub-overlookers, chargemen and monitors (elected by ballot amongst themselves) as are required to make up a number equal to that of the workers' delegates. The manager of the department is ex-officio chairman of the sectional councils. He does not have a casting vote. In case of a drawn vote the matter is submitted to the director controlling the department.

In addition, there will be one delegate appointed by each

union concerned (for the men's sectional councils from the men's union, and for the women's sectional councils from the women's union), who shall be allowed to speak but shall have no vote. Such delegates shall be deemed to hold a watching brief for the union, but shall be in the employment of the firm and working in the department, and preferably, though not necessarily, in the section.

The departmental council is a distinct body from the sectional councils and consists of one member for every fifty workers (or part of fifty exceeding twenty-five), with an equal number of the administrative staff, namely, manager, head overlookers, sub-overlookers, monitors and chargemen. Where these exceed the workers, the members representing the administration will consist of the manager and head overlookers, together with as many of the sub-overlookers, chargemen and monitors (elected by ballot amongst themselves), as are required to make up a number equal to that of the workers' delegates.

At the meetings of the departmental councils there will also be one delegate appointed by the union representing the men and one by the union representing the women, who shall be allowed to speak, but shall have no votes. Such delegates shall be deemed to hold a watching brief for the union, but shall be in the employment of the firm and working in the department.

Further, the workers are entitled to have the attendance of a permanent official of their union, not necessarily in the employment of the firm, during the discussion of any matter on which they consider that they should have skilled assistance and advice. Any such official attending a departmental council meeting shall withdraw as soon as the matter is disposed of upon which his or her advice has been required.

Nothing that takes place at a sectional or departmental council shall prejudice the trade union in raising any question in the ordinary way. Questions of general principle, such as the working week, wage standards and general wage rules, shall not be within the jurisdiction of the councils.

All male employees over twenty-one years of age and all female employees over sixteen, who have been employed by the firms for six months (whether on the regular staff or not), will be eligible to vote for delegates to both the sectional or departmental councils and to become members of such coun

cils. Delegates are elected to serve for one year. They will be eligible for re-election so long as they remain in the employment of the company. No deduction will be made from the wages of day-workers for the time occupied as delegates in attending the council meetings, and piece-workers will receive an average wage for the time so occupied.

Based on this constitution, the sectional and departmental councils in the almond paste department work out as follows:

Men

(5)

Slab, machine and boiling (4th floor).

(6) Crystallising and piping (5th floor), cage and carting (3rd floor).

The number of delegates for each of these councils work out thus:

(5) Slab, machine and boiling (4th floor).......

(6) Crystallising and Piping (5th floor)

Cage and carting (3rd floor)..

9

2

II

5

Total