VICTIMS OF INJUSTICE

Rotorua Morning Post, Volume 2, Issue 332, 20 September 1932, Page 3

VICTIMS OF INJUSTICE

COMMENTS ON GOYERMENT t SUPERANNU ATION ' FUNDS. i i STATE'S BREACH OF CONTRACT. "Not to put too fine a point on it, there has been a breach of contract on the part of the State," says "National Education," the official organ i of the New Zealand Educational Association, when diseussing the position of the State Superannuation Fund. It says that the employee contributors to the fund have been the vic- ' tims of injustice. The journal says that there is a come than lilcely possibility that the j subjact of the superannuation scheme ' will come before Pai'liament. "The j State Superannuation Fund and its ! financial stability have been the subject of reeent comment, and the National Exp'enditure Commission has made certain recommendations in regard to them," the paper says. "All State superannuation schemes and private group insurance schemes ' having the same object in view rest j on the basis of proportionate contribu- ! tions to the funds of both employer and employees," it goes on. "Thus the i employers settle in part the claim for high salary scales which would enable the employee to make his own arrangement for providing for old age. "The employee knows for his part that in paying a regular amount deducted from his salary into an inte-rest-Jearning fund on his behalf he need have little further anxiety as to his future. He is therefore content and satisfied to rexnain at a low salary. in the walk of life he has chosen. It is essential to the har-

monious and emcient workmg of any establishment, publie or private, that the staff should he contented. Superannuation is a very powerful factor in ensuring this: "It is obvious that the failure of either party to a superannuation scheme to carry out the obligations undertaken when it is launched will endanger the financial stability of the fund. That is precisely what has happened to the superannuation payments by the State. "The employees have done their part. The employers, th'e State, which is the people, have failed to do theirs. Not to put too fine a point upon it, there has been a breach of contract on the part of the State. "The Government may argue, when the time comes for the subject to be

1 r^. -rrrra discussed, that on various grounds the fund is actuarially unsound. But it eannot argue itself out of its default in respect to its share of the liability. It has been warned repeatedly hy its expert advisers of the danger of the course that it had been pursuing, but it has never done more than make spasmodic contributions. "The result has been that the funds have not been able to earn the interest to the extent that would have been possible had regular payments due hy the State been made. Thus the employee contributors have been done a double injustice."