The Akaroa Mail. FRIDAY, AUGUST 27.

Akaroa Mail and Banks Peninsula Advertiser, Volume V, Issue 428, 27 August 1880, Page 2

The Akaroa Mail. FRIDAY, AUGUST 27.

Rectriung to the report of the Registrar of Friendly Societies, which we have already noticed in a former issue, it is interesting to note something of what has been done during the year. Of course a good deal tjof the work of the office is of a purely formal nature, and is thus described in the report: —

" Tlie general work of the office in the administration of the Friendly Societies Act, 1877 and 1878-tho examination of returne and issue of queries on defects or errors therein, the correspondence relating tv registration and what may be necessary to Bectira compliance with the Acts, the general procedure connected with registration or cancelment thereof, the recording changes of officers of societies, and other details—occupies a considerable amount of time, and is similar in character from yeai§tn year."

Besides this, however, we learn that the transference on to cards of information in respect of members who were sick, died, or seceded during the year, is still kept up. The statistical tables for 1878 are complete, and in the hands of the printer, and those for 1879 are in a forward state. Seven new societies, and twelve new branches of registered societies have been registered during the year. Considering that a number of societies have been working under a scale of contributions, which has been pronounced by competent authorities to be utterly insufficient to provide for the benefits offered, it is satisfactory to find that many of them have seen the errors of their ways, and have improved in this particular. The Register gives the following list of

retained, the gr.idmd incrca.se of funds, in spite of tiio comparative age <>l' tin; lodges, being taken as evidence of adequacy. Two societies have been dissolved — one with i viow to re-construction on a now basis, and of this Uie Registrar says : — " Tlie New Plymouth Friendly Society is interesting as having buen tho lir&t society in the colony , to register, and also as being, so far as is known, tbe oldest society in New Zealand. It lias for some time past been in an approximately stationary state as regards number of members—the numbers of admissions and departures having been very small, and about.evenly, balanced;^ltsi'utn re progress, when reconstituted, de|eryes.tb be watched with very great interest. '■ It" lias hitherto charged a uniform contribution of 2s Gd per month, together with a small extra annual contribution for membars entering at the: higher ages, for a scab of benefits slightly higher than that guaranteed by most colonial branches of thotwo great English orders, , 'though with a saving clause as regards payments- in protracted sickness, but, as far back as ite operations have been watuhed/by the Kegistry Office, it lias realised a very di#h rate of interest on its funds. The average age of its members at tho time of dissolution,was about 42."

One section of the Act forbids the appropriation of an excess of interest over 4 per cent, earned by the Sick Fund to the Management Fund. Of this some lodges luive complained, and. the Registrar, or rather the Actuary attached to the office, has the following remarks among others on the necessity for the regulation:—

'•There is, however, in the present case another reason why the rate of interest assumed in a valuation or in the construction of tables should be somewhat lower than the rate which we may expect will be actually realized. This reason is contained in the fact that the tables.do not include any provision for the possibility of adverse fluctuations in the society's experience of sickiipss or mortal!ty—fluctuations which are likely to be very considerable in the case of small lodges, especially in _ regard to the amount of protracted sickness. Hence, if a society were to enter on a given period! o f, say, fire years with exactly onoiigh funds in hand to meet it's liabilities'according to the tables, and were throughout the five yenrs to appropriate all interest beyond 4 per cent to the Management Fund, it follows that, apart from the profits accruing from secessions, there would be an equal likelihood of a surplus or a deficiency at their close Now, the existence of a surplus is not a matter to be deprecated ; but a deficiency is a serious disaster. To permit the two results to be equally probable is quite an inadmissible course. Life insurance offices regard it as an axiom that there ought never to be a deficiency at a valuation. One counteracting element has already been alluded to-—namely, the profit arising from secesaion ; but, as a further and more perfect safeguard, it is desirable that the interest actually earned should exceed the interest assumed, so that the exoens may compensate for an unfavourable sickness experience, should such be the society's lot. It is not an infrequent thing for life insurance offices to realize a rate of interest exceeding by 2 per cent or 13 per cent the rate assumed in valuations and in the computation of the premiums. Thus the Australian Widows' Fund vva? recently \allied at 4£ per cent at a time when the annual interest was about 8£ percent on tho aggregate funds. Such are the general principles which forbid the application to irianageinent expenses of interest earned by a benefit;fund."

A very valuable instalment of the tables compiled, from the quinquennial returns is presented on page 8 of the report. The table in question is deduced from the returns of the four oldest lodges which will be Included in the experience table. The deductions are very valuable as showing conclusively what does not appear to have been evident to many of the compilers of rates of contribution, viz., that the amount of sickness experienced increases steadily with age, and on advanced ages takes an immense stride. Thus we find the average number of weeks' sicknes". per annum to. range from -202 to 33*897. In other words at the youngest ages each member was sick only a quarter; of a week in the year on an avcraaro, while the oldest members experienced , each 33 weeks and over a third during the same period. Or to put it in another fqrm—four members of a lodge at tlio earlier age would draw one week's sick pay between them in a year, while four of the older, members would be entitled to pay for over a hundred and thirty-thrpe weeks during the same space of time ! And yet there arc many societies which still follow the absurd practice of charging equal rates to members joining at all ages.

Another"point which strikes one from examination" of this table is that while it seems reasonable to expect a lower mortality in this country than in Great Britain, that is that members will enjoy longer life here than in those countries on whose experience and rates have been calculated, yet this longevity may by no means prove an unmixed benefit to the funds of those societies. For while the rate of sickness at most ages comparer, favorably with the English data, and in some instances falls below the lowest rates tabulated by Mr HadclifJ'e, yet at the advanced age it is higher than any tabulated by the same gentleman. In other words, while people will live longer, th»y will in many instances survive in numbers at those ages when an enormous amount of sickness may be

expected, and these provo a very heavy

drain on the funds of the societies to which they belong.

It is satisfactory to learn that seven lodges have boon valued during the past year, though the results .are not over favorable. In only one case, that of the Charles Bruce Lodgo, was a surplus shown. The other six lodges, forming the Hokitika district Manchester Unity, all showed a deficiency. In one case, that of- the Loyal Goldsborough Lodge, the deficiency was more than twenty times it« accumulated fund. In this instance; the, valuer recommended- amalgamation with some other lodge,'a course which was adopted. The valuer's remarks as to the causes of this disastrous state of affairs are eacli worthy of attention, and with them we will close this article. Mr Leslie says :—

"The experience of this lodge, illustrates very forcibly the necessity of the number of 'members in a lining sufficiently" large "to afford a fair basis for the operation of average before there Cfin' be' "any 3 safety. In" the lottery of chancos with small numbers some lodges in the diatrict have been fortunnto ; but this lodge has been very unfortunate, kntli the result is the large deficiency shown .by this valuation. . The sickness experienced has' been very much in excess of tlie expectation, and the mortality has also been above the average. 1, ' :