History of National Friendly - The Second Fifty Years
1914 saw Britain’s entry into the First World War. The war drew in all of the world’s economic great powers, forming two opposing alliances. The Allies were built up of the Russian Empire, the French Third Republic and the United Kingdom of Great Britain and Ireland versus the Central Powers of Germany and Austria-Hungary, the Ottoman Empire and, later, Bulgaria. The war would last until 11 November 1918 and take the lives of over nine million combatants and seven million civilians.
By 1918, National Deposit had lost 10,000 of its members, killed on active service, and was faced with a host of injured soldiers supporting them through convalescence and sickness benefits. The Society already offered convalescent facilities but decided that it should honour the fallen by building one of its own.
In 1923, as the Society grew, a new bigger premises in Queen’s Square, London, was completed and opened by the Duke of York (later King George VI). This would remain as the National Deposit Friendly Society's home right up until World War Two.
In 1939 the Society wisely moved premises to Shepton Mallet in Somerset, aware that the Queen’s Square premises in London and, indeed, the records and administration of 750,000 State members, would be vulnerable. This was a clever move. The property in Queen’s Square was so badly damaged, that when the Society moved its headquarters back to London, it did so at Buckingham Palace Road, where it remained until 1978.
1948 saw the inception of the National Health Service, which would become the largest and oldest single-payer healthcare system in the world. This would undoubtedly lead to the separation between state insurance and voluntary insurance as far as the friendly societies were concerned, leading to a great fall in National Friendly Deposit Society's membership.
National Deposit Friendly Society’s membership was split into two sections: firstly, the deposit section which stood at 1,559,696 members and, secondly, the state section which had 888,820 members as stated in the 1947 issue of the N.D.F.S. Annual Report. These numbers had dropped dramatically by 1950 with the state section no longer in existence due to the introduction of the NHS and the deposit section down to 925,467 members, losing over a third of its members in 3 years.
The National Health Service (NHS) became the publicly funded national healthcare system that would continue to provide healthcare to all legal English residents with the majority of services free at the point of use.
The National Health Service, established by the post-war Labour government, represented a fundamental change in the provision of medical services. The General Practitioner (GP) service became organised on the basis of a 'capitation fee' paid by the government on every patient registered with a doctor. Voluntary and municipal hospitals were integrated under state control, exercised by the Ministry of Health.
The Society subsequently approached Lord Beveridge, inviting him to study the problems presented to friendly societies by the National Insurance Act. National Deposit Friendly Society commissioned Lord Beveridge to write the report ‘Voluntary Action – A Report on Methods of Social Advance’. In the acknowledgements, Beveridge talks of the ‘spirited help of the National Deposit Friendly Society.’ He goes on to say “They provided not only the necessary funds but also office accommodation and other facilities in their own building at Universal House, in Buckingham Palace Road.”
Beveridge highlighted the popular appeal of a combination of insurance and saving as well as a need to differentiate their offering from that of the industrial life offices in which they were competing for business. He noted that friendly societies can offer in many ways a much better service to the public, free of liability to shareholders and free of the heavy expense of collectors. However, Beveridge clarified that friendly societies should not wait for these advantages to be discovered for themselves by the public but rather make them clear from the start.
The National Deposit Friendly Society already had insurance via its deposit-based healthcare. Later, a tax-exempt savings plan was launched which combined a saving mechanism with life insurance with the Society keen to offer the existing privilege of tax-exemption.
After the publication and wide circulation in 1948, the difficulty was how to translate such recommendation from Beveridge into action. Lord Samuel was persuaded to bring the question of voluntary action for social progress to the attention of the House of Lords, making it possible to debate Lord Beveridge’s third report. The summary of this debate noted that it was very pleasing to record that every one of the recommendations listed by Lord Beveridge received consideration by the respective authorities.
The developments that followed the action initiated by NDFS were of unquestioned benefit to the people of Britain as a whole. In the creation of the Friendly Societies Act of 1955, Lord Beveridge, the gifted author of Voluntary Action, made an important statement (1948) of this matter which is quoted below:
“In a totalitarian society all action outside the citizen’s home – and it may be much that goes on there – is directed and controlled by the state. By contrast, vigour and abundance of Voluntary Action outside one’s home, individually and in association with other citizens, for bettering one’s own life and that of one’s fellows, are the distinguishing marks of a free society. They have been outstanding features of British life… room, opportunity and encouragement must be kept for Voluntary Action in seeking new ways of social advance. There is need for political invention to find new ways of fruitful co-operation between public authorities and voluntary agencies.”
From the evidence here, it is likely that without National Deposit Friendly Society’s foresight and action in sponsoring the report Voluntary Action, it is more than probable that the Friendly Societies Act of 1955, the legislation of charities, and the extended powers of investment for trustees, would not have come into being.
1955 saw a new focus on life insurance and savings plans with National Deposit Friendly Society looking to diversify away from sickness-based products. Deposit (sickness) membership was down to 690,435 according to the Annual Report for the year however, assurance (savings) membership started at 26,560 in 1954 and increased to 29,363 in 1955. By 1970 assurance membership was up to 46,845 with deposit membership sitting at 352,788.