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Thursday, March 23, 2006
From Stabroek News...
History This Week
War relief measures in British Guiana, 1939-1945
By Arlene Munro
Thursday, March 23rd 2006

During the early years of the Second World War, there were certain hardships
in the British Caribbean such as food shortages, the increased cost of
living and black marketing. The factors responsible for these conditions
were the disruption of shipping due to the Second World War, the adoption of
the imperial war policy that imports be reduced, and the Caribbean's long
dependence on food imports, which retarded local food production.

As a consequence, the colonial administration of British Guiana took
measures to provide relief to the Guianese people. This relief was one
aspect of colonial wartime policy and was recommended by the Colonial
Office. The relief took the form of war bonuses, pension bonuses and
subsidisation of food imports. These measures were deemed necessary because
of the severe hardship experienced in the colony as a consequence of the
Second World War. For example, there were steep rises in the cost of living
index. Between 1938 and 1944, the cost of food rose by fifty-four percent in
Georgetown and sixty-eight percent on the sugar estates in the rural areas.
Moreover, the cost of living index had moved from 100 in 1938 to 161 in 1945
in the city while, in the rural areas, it rose from 100 in 1938 to 190 in
1945. Imported goods and food were scarce and rationed. Shopkeepers hoarded
goods and demanded as much as a 300 percent increase in prices when they
produced them for sale weeks later, in spite of the existence of a price
control organization. This Price Control Organization was given the
responsibility of regulating prices of imported commodities.

The factors leading to the adoption of war relief measures were mostly
related to the Second World War, the disruption in shipping lines with its
consequent shortages of supplies and the spiralling cost of living,
impoverishment, social discontent, trade union demands for increased wages,
and Colonial Office policy in the wake of the popular protests of the 1930s.

The most important factor leading to the provision of war relief was the
Second World War. It dislocated international shipping, including supply
lines to the Caribbean. In 1942, German U-boats wreaked destruction in the
waters surrounding Trinidad, sinking 130 ships, some of which were bauxite
shuttles from the Guianas. Occasionally, enemy submarines were observed just
off the coast of British Guiana in the Atlantic Ocean.

Consequently, from time to time, the Canadian ships which delivered imports
to British Guiana were unable to do so. For example, in 1942, there was a
temporary stoppage then arrangements were made for a combined
British-American-Canadian fleet of ships to resume shipping by September of
that year. So affected was the Caribbean that, in 1942, there was a two-week
period when British Guiana and Dominica lacked bread due to the shortage of
flour when ships failed to arrive.

Trade union demands for increased wages to counter the rising cost of living
constituted another factor contributing to war relief measures. On December
3, 1939, trade unions sent a resolution to the colonial administration
demanding increased wages for government employees and sugar workers. The
resolution cited the rising cost of living and the lack of employment
opportunities as some of the reasons for their demands. It stated that
merchants had raised prices just before the war started and it demanded
greater care in the controlling of prices. The British Guiana Labour Union,
the Man-Power Citizens' Association, Transport Workers' Union, British
Guiana Seamen's union, and the British Guiana Moulders' Union signed this
resolution.

Colonial Office policy was another factor contributing to war relief
measures. The Colonial Office, conscious of the hardships experienced in the
colonies and the potential for further social disaffection and popular
protest, was forced to adopt a policy of war relief. The 1930s had been a
period of labour unrest in British Guiana and the West Indies and it was
feared that this could occur again. Therefore, the Colonial Office
recommended the adoption of certain measures, e.g. the granting of cost of
living bonuses to government and private employees, the creation of a "small
and controlled rise in prices" to "stimulate local production in
substitution for goods previously imported" and, finally, the control of the
rise in the cost of living through deliberate subsidization by government of
prices of certain necessities. The Colonial Office policy had a two-fold
objective to provide relief for the colonies and to protect the industrial
interests of the United Kingdom. For example, its recommendation of war
bonuses instead of an increase in wages was made to prevent a rise in the
cost of production in the United Kingdom resulting from a rise in the prices
of colonial goods sold to the United Kingdom due to greater inflation as a
consequence of an increase in the living wage.

One of the war relief measures adopted by the government was subsidisation.
It was the system by which the government of British Guiana granted annual
subsidies for the importation of foreign products which the merchants
usually imported. This was done to prevent a rise in prices of products and
inflation. The objective of subsidisation was to keep the cost of essential
foods and goods at the pre-war level so that the working class could afford
them. In addition, if the cost of foods and goods remained low, there would
be fewer demands for wage increases. In 1942, the government decided to
subsidise essential commodities such as flour at the cost of $200,000.
Between September 1943 and February 1944, it subsidised fresh beef,
cornmeal, split peas, condensed milk, cooking butter, pickled beef, salt
fish, gas, diesel oil, kerosene, agricultural tools and charcoal.

The sugar industry was also persuaded to bear part of the cost of
subsidisation. The Executive Council agreed that an export tax should be
imposed on the sugar industry to be used to defray the cost of
subsidisation. Therefore, a tax of $1.00 was placed on each ton of sugar
produced in the colony.

Subsidisation was not without its opponents in the Legislative Council and
elsewhere. In 1945, Ayube Edun, Labour Representative in the Legislative
Council, made the observation that the industrialists, commercial firms,
banks, shopkeepers and pedlars were making financial profits from
subsidisation, while the consumer was making the sacrifice and facing
restrictions. He was no doubt referring to the necessary practice of
rationing imports.

Another problem was the issue of subsidisation vis-a-vis protection of local
substitutes. At a Legislative Council meeting of 1945 a decision was made to
stop subsidising flour because this encouraged greater flour consumption,
while local ground provisions were ignored. The Grow More Food campaign had
led to an over expansion of ground provisions and the surplus was being
thrown away.

How beneficial was subsidisation to the working class? At a Legislative
Council meeting in 1944 two conflicting views were given. One member of the
Council stated that due to subsidisation flour was being sold to the people
at prices below the pre-war cost. Another member contended that it was being
sold at the same price. In spite of their conflicting viewpoints, their
statements revealed that subsidisation had achieved its aim in that the
price of flour had not risen above the pre-war level.

By 1944, $1,969,531.12 was being spent on subsidisation. The Imperial
government provided $969,531.00 and the colonial government furnished
$1,000,000. As a consequence of the anticipated alteration in post-war
Imperial policy, subsidisation of all food imports except flour was
terminated in October 1947.

The granting of war relief bonuses by the government to the workers of
British Guiana was another form of war relief. It was considered preferable
to the granting of increased wages, which, it was argued, would lead to an
increase in the price of imports and greater inflation. At first, cost of
living bonuses were given to 'lower-paid workers' in 1940. As time went by,
other classes received bonuses as the range was extended to include workers
earning as much as sixty dollars per month. In 1942, the Legislative Council
agreed that workers would receive bonuses at the rate of fifteen percent on
the first $240 per annum, ten percent on the next $240 and five percent on
the last $240. In

1943 the range of government workers receiving bonuses was extended to
include those receiving a salary of $2,400 annually on condition that
subsidisation was increased. The maximum amount of bonus payable was $120
per annum, i.e. ten dollars per month.

Although war bonuses continued to be given to employees until 1947, they did
not bring about great improvement. They could hardly have done so because
they were so small. This payment of cost of living bonuses was being
practised throughout the British Caribbean.

War bonuses were also granted to the workers of the sugar industry by the
Sugar Producers' Association and to the bauxite workers by the Demerara
Bauxite Company.

Although the colonial government did not pay these allowances, workers in
both industries complained to the government whenever they were dissatisfied
with the rate of bonuses or the frequency with which they were paid.

War bonuses were also paid to retired government pensioners. This measure
had also been taken during the First World War. War bonuses for pensioners
were granted in response to proposals from the Legislative Council. On 30
July 1943, a committee comprising Council members E.G. Woolford, F.J.
Seaford, and Vincent Roth was appointed to consider offering war bonuses to
pensioners. The committee's report recommended that government pensioners
receive war bonuses with effect from 1 January 1944. Subsequently, it was
agreed that pensioners receiving $720 per annum and less would be granted
bonuses at the rate of fifteen per cent on the first $240 per annum, ten per
cent on the next $240, and five per cent on the last $240.

Another expedient adopted by the government was the revision of salaries.
This was because of the spiralling cost of living. By 1944, the cost of
living index had risen to 159 in Georgetown and 183 in rural areas. Salaries
were revised for the 'unclassified service' and the Police Force in 1943 as
well as the medical and post office workers in 1944. The post office workers
had taken strike action during that year. Also, an Anomalies Committee and
the O'Connor Committee continually revised salaries of other categories of
workers during the 1940s. The Anomalies Committee was appointed to
investigate and report on any anomalies pertaining to salaries of
subordinate employees, while taking into consideration the revised scales
recommended for different departments. Most of the recommendations of the
Anomalies Committee were adopted and implemented with effect from 1 January
1944.

The government of British Guiana, on the recommendation of the Imperial
government, sought to lessen the impact of the Second World War on the cost
of living in order to help Guianese by introducing the subsidisation of
imports, maintaining low prices of consumer goods, and offering cost of
living bonuses to pensioners. It also extended the range of government
workers receiving cost of living bonuses and increased government
expenditure in this respect.

The Colonial Office because of its fear of a recurrence of disturbances
similar to those of the 1930s, and because of the perceived efficacy of
these measures to combat inflation and subsequent demands for increased
wages from trade unions endorsed these measures.