War Relief Measures in British Guiana, 1939-1945
By Arlene Munro
November 21, 2002
During the early years of the Second World War, there were certain hardships in the British Caribbean such as food shortages, increased cost of living and blackmarketing. The factors responsible for these conditions were the disruption of shipping due to the 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 the subsidisation of food imports. These measures were deemed necessary because of the severe hardship experienced in the colony as a consequence of the 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 per cent in Georgetown and sixty-eight per cent on the sugar estates in the rural areas. Moreover, the cost of living index 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 per cent increase in prices when they produced them for sale weeks later, in spite of the existence of a price control organisation.
The factors leading to the adoption of war relief measures were mostly related to the war, the disruption of shipping lines with the 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. The war 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, the Transport Workers' Union the British Guiana Seamen's Union, and the British Guiana Mothers' 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, notably 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 subsidisation by government of prices of certain necessities. The Colonial Office policy had a two-fold objective, namely, 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 local 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 subsidized 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 subsidization, while the consumer was making the sacrifice and facing restrictions. He was no doubt referring to the necessary practice of rationing imports.
Another problem associated with subsidisation was the issue of subsidisation vis-à-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 Wartime 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, however, 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 at least had not risen.
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 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 war bonuses 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. 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.
Another expedient adopted by the government was the revision of salaries. This was due to 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. 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.