H.—6.

1885. NEW ZEALAND.

FRIENDLY SOCIETIES (EIGHTH REPORT, BY THE REGISTRAR OF).

Presented to both Houses of the General Assembly pursuant to " The Friendly Societies Act, 1882," Section 5, Subsection (8).

REPORT FOR THE YEAR 1884. In addition to the ordinary work of the year, the compilation of the statistics of sickness and mortality experience, &c, among New Zealand Friendly Societies for the quinquennium 1878-82, was begun and completed in 1884. A full explanation, of the method employed in this tabulation is given below. As affording corroborative proof of the necessity for the repeated advice which has been given on the subject of a graduated and sufficient scale of contributions, the Registrar invites the attentive consideration of societies to the importance attached by an eminent authority to such a scale as an essential principle of safety. His remarks, moreover, on the question are in special reference to a New Zealand society. The Nelson District of the Independent Order of Odd Fellows, Manchester Unity, wishing to have the opinion of an English valuer as to its position, arranged with Mr. Reuben Watson, actuary to their order, to make a valuation of the district. His report was received last year, the valuation being made, as desired by the society, on a 5-per-cent. basis. Nevertheless, in the case of each lodge in the district there is shown a serious deficiency, and, as the weight of Mr. Watson's authority will perhaps carry conviction to some who have been inclined to dispute the arguments, and disregard the warnings of the Friendly Societies' Valuers resident in the colony, extracts are given from this additional and independent source. Nelson Lodge.- —"The general principles on which the lodge has been established are unsound. A very low rate of contribution has been charged, and no attention appears to have been paid to the increased value of the liabilities of those members who have been farthest advanced in life at the date of admission to the lodge. The high rate of interest derived from the invested funds seems to have had a misleading effect, and led to expectations which cannot possibly be fulfilled. It is not likely that the advantages which colonial friendly societies reap from the ample returns they derive from invested funds can continue for all time, and friendly societies should not make future promises which depend on the permanent realization of such high-interest rates. It cannot be intended to mislead, or in any way betray into false and ruinous expectations either the rising or any future generation. That, however, will be the effect of continuing to promise present benefits for present contribution rates. While young men continue to join and some secede, the consequences of insufficient contribution payments are concealed in a great measure ; but, as old age comes on, the errors so committed become exposed, but the consequences of them fall on to the wrong shoulders, and unintended injustice is the result. There can be no doubt that the future safety of this important lodge demands a readjustment of the contribution rates by graduated and equitable tables." Howard Lodge. —"There is evidence of able and careful management, but this of itself will not compensate for the unreasonably low contribution rate, nor will it make amends for the incomprehensible error of admitting members at various ages without any regard to the liabilities they bring on to the lodge. The adoption of a properly-graduated table of contributions for future members is an imperative necessity." Travellers' Best Lodge.- —" It is calculated that 5 per cent, will always be yielded by the whole of the funds and future contributions of the members. That rate has not been obtained during the last quinquennial period, and present investments do not seem to justify the expectation that 5 per cent, will be realized on the average in future transactions. The contributions are altogether insufficient, and disastrous failure is threatened; and this may come at a time when, from long-con-tinued affliction and natural decay, the assistance of the lodge is most required by the members. The lodge should adopt a properly-graduated table, for the system of equal rates of contribution, I—H. 5.