SOUTHLAND BUILDING SOCIETY

Southland Times, Issue 18836, 1 June 1920, Page 2

SOUTHLAND BUILDING SOCIETY

To the Editor. Sir, —If “Shareholder” reads again my reference to the “new iniquity” he will see that he has expended much ink unnecessarily because obviously the term was applied only to a candidate bolding such ideas as those expressed by him. “Shareholder” returns to the charge of underpaid officials with a note of triumph. “Until recently certain members received very small salaries.” Let us “feee. In 19ID salaries and bonuses were only £55 less than this year. How then can “Shareholder” make such a statement '! If another increase has now been made, it is because new conditions have arisen requiring larger salaries on which to live. "Shareholder” takes exception to bonuses being included, because “they are really pay for extra time worked.” I think not. I learn on inquiry that the staff, besides getting an annual holiday of a fortnight, gets every public holiday and every bank holiday and these are considerable. These holidays are a set off to overtime at balance and a liberal set off they are. The bonus is given in view of the increased cost of living and is in line with other large institutions and are correctly classed with salary. “Shareholder” makes a comparison with directors’ fees to the disadvantage of the latter, of course. This comparison will stand investigation, too. One does not realise what a large concern this society is until figures are scanned. For instance, £380,500 loan money is now current and £150,000 was applied for last year. Now it is the Board of Directors and not the staff who are responsible for the safe conduct of this immense business. There are a president and nine directors entrusted by shareholders with the management. For remuneration they receive eight pence per share per annum, that is, a shareholder with one share pays eight pence for the services of these ten for a year. Does “Shareholder” seriously object to this? “Shareholder” says that borrowers who withdraw before their shares mature are unduly penalised. This sounds all right, like most of “Shareholder’s” assertions until they are examined. In practice it will be found that borrowers have not much to complain about. A contract is entered into and both parties are expected to see it through. Lenders have a right to refuse to accept repayment. Some do, but the common practice is to charge six or three months’ interest as a penalty. Three months is now the general rate. In the case of the society, with very large amounts out, it is desirable to keep them out in terms of the mortgage otherwise there is danger of a glut and large sums on hand earning nothing. Therefore, to discourage the practice a penalty in the shape of a loss of a proportion of the profits is provided. I think this explanation will suffice, sir, for most of your readers. Does “Shareholder” mean to suggest that the creation of a 20 years’ series would do away with bad pays Probably he would find the proportion much greater because only a class less able to pay would take up this series and the society in providing it would be courting trouble, well defined and plenty of it. I would, sir fain follow “Shareholder” further, but consideration for your space counsels a halt. I thank you, sir, for your courtesy and consideration. — lam, etc., EX-DEBENTURE HOLDER.