“Sop to Cerberus”

Sun (Auckland), Volume II, Issue 345, 4 May 1928, Page 8

“Sop to Cerberus”

RAILWAY BENEFIT FUND Friendly Societies Indignant FRIENDLY SOCIETIES throughout New Zealand are concerned over the Government’s proposal to establish a subsidised sick benefit fund for railwaymen. Mr. John McLeod, dean of Auckland lodge secretaries, this morning expressed the opinion that the proposed funu was merely “a sop to Cerberus” to conciliate the railwaymen and prevent strikes.

There is legislative provision empowering the Government to supervise the administration of friendly society funds, and the societies are required to observe rigid standards of financial security. Since railway employees throughout New Zealand form a large proportion of their membership, the societies are indignant that their strength should be threatened by a fund not subject to the same rules.

The standards of friendly societies in New Zealand are admittedly high. There is a total of 1,000 lodges and courts, with 100,000 members. Their funds total nearly three and a-half millions, including over £3,100,000 in

sick and funeral funds alone, while medical and management funds amount to £153,867, widows’ and orphans’ funds to £ 21,166, and distress and benevolent funds to £56,177. Both the accumulated funds and the average capital per member show a steadily increasing tendency, and the latter now stands at £35 6s Bd. This is distinctly higher than the figure shown by friendly societies in any of the Australian States, of which Victoria has the best figure with £26. 3 s 4d. and Tasmania the lowest with £l3 Is 6d. By these comparisons it is possible to gauge the strength of the New Zealand societies. SOUND INVESTMENTS A feature of the operations of the New Zealand Friendly Societies has been the soundness of their investments. As in Auckland, they have invested in city property with considerable success. Here the Manchester Unity’s fine new block represents the latest of these enterprises. The average return on money invested for all societies throughout the country, is £5 16s 3d per cent., and the highest return is that gathered by the Sons and Daughters of Temperance, which earns 6.63 per cent., on its money.

All the societies in New Zealand are affected by the Government s proposal to establish a railway benefit fund. Obviously there are not many railway employees who will be eager to contribute to two separate funds, and, as the Government fund will be subsidised by the State, it can afford to make a smaller levy on its contributors. As a result the established friendly societies must inevitably lose in strength and membership. “It is affecting us very much,” said Mr. John McLeod, when questioned this morning. “TVe feel that the fund will be quite unsound from an actuarial point of view, as our information shows us that a deficit of £B,OOO will be made up by a levy on State funds. The taxpayer will thus be bearing the burden of supporting the fund. “We have many old-established members who will be compelled to withdraw from our society and subscribe to the railway fund. Every registered friendly society in New Zealand has protested, and the Prime Minister promised to defer the introduction of the scheme until we had been given means of considering it more fully. This promise has not been fulfilled.” GATHERING PROTESTS At a gathering of the Manchester I’ nit v Order in Hastings recently, strongly-worded resolutions were passed. It was contended that the scheme was a direct violation of the Government’s own requirements in the registration and certification of similar funds controlled by friendly societies, and that the transgression by the Government of its own legislative enactments would destroy confidence in the provisions of the Friendly Societies Act as a whole. Mr. R. Darlow, district secretary of the Ancient Order of Foresters, was as emphatic as Mr. McLeod: “I feel sure,” he said, “that if railwaymen give up membership in a friendly society to become contributors to this new fund, the day will come when they will regret the step." While they are concerned at the prospective formation of the railways scheme, the Auckland friendly societies have another matter for concern, nearer home. By an agreement with the Hospital Board, the local friendly societies receive a hospital levy from their members, and in turn pay hospital expenses incurred by the contributors. This has worked satisfactorily iu the past, but the hospital board now proposes, on account of growing maintenance costs, to raise its fees to the lodges. This means, according to the latter, that they will have great difficulty in meeting hospital bills and still keeping the levy at its present rate. Against the hospital board’s reference to increased costs, the societies set the argument

that under tjte past arrangements the board has been guaranteed payment, with no costs for collection-