National Pensions.

Manawatu Standard, Volume XLI, Issue 8197, 25 May 1906, Page 7

National Pensions.

The Premier's Proposals. How Friendly Societies Will Be Affected. Per Press Association. WELLINGTON, May 22. The president of the Friendly Soeie ties' Conference received a letter fron the Premier, which was read at th< sitting of the Conference to-day. The letter, referring to national pen sions, was as follows :—" It is with verj great pleasure that I lay before yoi some suggestions in connection with t national annuities measure, which ] contemplate introducing into Parlia' menfc during the coming session. Recognising as I do the enormous value of the services which Friendly {Societies have rendered to the nation, I am anxious that the National Annuities Bill should be so framed as to conserve the interests of the Friendly Societies to the greatest extent possible, and thus, perhaps, increase their usefulness to the country still further. To this end it has seemed to me that some such measure as the following would be most helpful. "(1) In the case of all weekly allowances, which are or will be made by societies or lodges to their aged members (i.e., members over sixty-five years of age) during sickness or other infirmity, I propose to offer a proportion of this weekly allowance. The lodge would in these cases go on as at present, itself paying the sick allowances to the aged members in the fr st instance, but at the end of every third year the Government would make a calculation to ascertain what aum the lodge was entitled to by way of a refund. The percentage of refunds in the case of each member would be on a sliding scale, ranging from 10 to 50 per cent ot the weekly allowance, according to family and other circumstances of the member, while drawing sick pay. This sliding scaie of refunds or subsidies would take into account the civil condition of the member—i.e., whether married or single, and the number of children —as points which affect the welfare of the community, the design being to encourage such modes of life (viz., thrift, marriage, etc.) which are conducive to the national welfare, and my Government recognises that of these habits, which are so important to us few (if any), can stand higher than membership in a well managed friendly society.

"(2) In the case of members who are under sixty-five years of age, the Government would, not be able to make a refund m respect o E the weekly allowance for is what known as " acute" sickness —i.e., sickness during the first twelve months after the commencement of the attack—but for all cases of sickness or other infirmity, where the incapacitated member is or will be drawing sick pay continuously for more than twelve months, I propose to offer to lodges a refund from the Treasury, according to the following scale :—Members aged. 55 to 65, 50 per cent, refund ; 45 to 55, 60 per cent, refund ; 35 to 45, 70 per cent, refund; 25 to 35, 89 per cent, refund ; under 25, 90 per cent, refund. The experience of Friendly Societies, and the theory of actuarial science, unite in providing that this payment for premature permanent invalidity—i.e., for chronic sickness or infirmity in the case of young and middle-aged members, which has already lasted for a period of twelve months continuously - is a risk which it is.pcculiarly unsuitable for a small lodge to undertake by itself. It is not that with a large membership, the aggregate amount of sick payment would be proportionately great, but the experience of different lodges is liable to vary so much with reference to this particular risk, that while many lodges escape even the small amount of such premature permanent sickness as the actuarial tables indicate for an average, some few lodges will be unfortunate enough to have far more than the average share of such permanent sickness, and will be liable to insolvency in spite of the best calculated scale of contributions. Hence the necessity for spreading this particular kind of risk over a larger area than the individual lodge, just as the funeral benefits granted by lodges have long ago been spread over the entire district to which the lodges belong. " (3) Besides giving these subsidies to the lodges and other societies as a direct refund of a certain percentage of weekly allowances, which they pay to their aged members and to those who are permanently invalided, I am anxious to give a special subsidy to members of Friendly Societies who may apply for deferred annuities from the Government under my national annuities scheme. Such annuities will be subsidised from the Treasury, in accordance with the sliding scale I have already referred, to, which takes infco account the elements of marriage, persistency in making deposits, etc.; but, feeling the extreme importance to the nation of the Friendly Societies, I propose to make an additional subsidy of 5 per cent in the case of any applicant for an annuity who is a mefhber of a Friendly Society. In the case, however, of these societies which have been pronounced at their last realisation to have an actuarial deficiency, it seems to me of such importance to strengthen the solvency of the sick and funeral fund, that I propose to allocate one-half of this additional subsidy of 5 per cent to that purpose, and I suggest that only the remaining half shall go towards increasing the annuity of the individual member. " (4) Irrespective of membership in Friendly Societies, it is proposed under my National Annuities Bill to allow all persons to take out deferred annuities with the Government—i.e., annuities beginning at such ages as sixty, sixtyfive, and seventy —by making deposits according to a certain scale which will be specified in the schedule to the Acs. These annuities will be subsidised by making payments from the Treasury. That will have the effect of increasing such annuities by amounts ranging from 10 to 45 per cent., according to the family and other circumstances of the applicant for the annuity; but, of course, in all these cases —i.e., in the case of persons who are not members of Friendly Societies—there will be no extra subsidy of 5 per cent, such as the Friendly Societies' members will be entitled to. I hope that the proposals that I have outlined will commend themselves to the judgment of the New Zealand Friendly Societies." WELLINGTON. May 24. The Colonial Conference of Friendly Societies gave consideration this afternoon to the letter received from the Premier on the subject of national annuities. Bro. Salek (Wanganui) said he w;ould liko to know why Friendly Societies should ba offered a refund and'turned

into charitable insitutions. They were independent in every way, and if they accepted anything at all they would bo amenable to the Government. Other societies encouraged thrift; the insurance companies did so by insuring for a given amount at a certain age, and he would like to know whether the Government would dare to make a similar offer to such institutions. The societies consisted of men who had bound themselves together for mutual help. They had never asked the Government for monetary assistance, and ho failed to see why they should be offered a sliding scale of refunds. The Societies wanted no assistance from the Government or any other body in the colony. Bro. Jull iHawke's Bay) felt that the Conference should do something more than pass a resolution rejecting the proposals, on the ground that they would not accept any help from the Government. Bro. Everett (Nelson) objected to cavalierly treating the proposals. The application of this scheme would enable them to take in the infirm, whom, under present circumstances, the Society reject. Bro. Harvey (Otaki) was of opinion that the Premier's idea was to encourage thrift. Bro. Moffatt hoped the scheme would receive every consideration. After further discussion Bro. Loasby moved an amendment which was carried, expressing the view that before a decided opinion could be expressed on the scheme, a Bill authorising refunds to societies should be before the societies.