1.—14.

56

[g. hogben and M. FOX.

Mr. Hogben : I know there are other ways of doing it, such as adjusting it every live years; but what I have put before you seems to me such a simple way of managing it. 49. Mr. Fowlds.] And that £12,000 for the old members goes on for all eternity? Yes. If you want it to work itself out you must make the amount larger. If you make it £15,000 it will work itself out in something like forty-one years. 50. Mr. J. Allen.] As to the suggestion you make for new entrants : this £6,000 is the capital amount, is it not ?—You pay the capital amount for the new entrants each year, but it comes to the same amount as £2 a head on all the members. That more than does it; and even if after a certain number of years the rate of interest was such that you could not get 4 per cent., you would be safe — the capital liability would not be increasing. The rate of interest might have to be adjusted. That is why I should prefer provision being made to pay off the deficiency on the original members in a certain time—or to create a sinking fund, if you like. My suggestion would be, preferably, to pay a larger amount than £12,000 per annum in respect of the old members, and so pay the liability off altogether. Mr. Fox : Mine is hardly a scheme ;itis a suggestion. It struck me that what Mr. Allen wishes is something that will stand for a time, if not for ever. If the interest on the increasing liability were paid every year it would be something like this : the Government would have to pay, roughly, in the first year £320, in the second year £640, in the third year £960, and so on ; the amount increasing and going on. For the first five years it would be a simple matter to find out what that would be, and what would be the equivalent in the way of a yearly payment for five years. It would be something like, perhaps, £900 a year for five years, and then it would need to be adjusted. You have arranged for investigation of. the fund every five years, and that would be a proper time to make these adjustments, I consider. 51. Mr. J. Allen (to Mr. Fox).] The capital liability would be growing, would it not ? —lt would be increasing each year, on account of the new members coming in. 52. Mr. Fowlds.] Going back to a question that Mr. Allen asked you with reference to the amount ol £11,702 shown in Table 7, on page 60 —you stated that this contribution of £11,702 would be a decreasing quantity ?—Yes. 53. Is that so —I refer to the contribution for a minimum pension of £52 ?—Yes, certainly ; because it is only for the existing staff. That particular contribution is not necessary for the increasing new staff, because they are all supposed to enter at twenty-three, and by the time they are of pension-age they will be over the minimum of £52. So that that will dwindle as the existing members die off. 54. That is not reckoned as interest on the capital deficiency ?—No. 55. Mr. J. Allen (to Mr. Hogben).] Is there a limit of £120 in the Bill, or any limit as a maximum ? —No. 56. Is not the actuarial calculation made for a forty-sixtieths limit of total salary ?—Yes. 57. Is that in the Bill ?—Well, it is not a limit of the Bill, but one due to the facts. 58. Is there any maximum in the Bill at all ?—No ; but the higher salaries are safer than the lower salaries, because you do not increase the benefit of £200 to the widow in the case of the higher salaries. The benefit of £200 to the widow is given to all of them. The widow of a man who contributed on a salary of £100—that is, £5 a year—will get £200 in addition to the return of contributions; and the widow of a man who contributes £30 a year will get only the same sum added to the contributions. You will see from Mr. Fox's tables that a very good proportion of the money goes for that payment to the widow, which is in the way of provision for the children as well. 59. Mr. Fowlds.~\ In what table is that shown ? —ln Table 1, on page 57. If you will take age 23, for sixtieths, column 5, you will see that the contribution for the payment of this sum of £200 to the widow is £1 2s. 7d. per cent, out of £7 16s. 4d. for the four benefits covered by that table —say, £2 os. Bd. on the average salary of £180. Well, though a man might pay two or three times as much in contributions, the £2 os. Bd. does not increase, because you do not increase the £200. 60. Mr. J. Allen.] Do you mean to tell me, if there is no maximum in the Bill, a teacher cannot get more than £120 as a retiring-allowance ?—He goes in at twenty-three—he cannot get his certificate before he is twenty-one, and the majority will come in at about twenty-three—they must retire at sixty-five ; so it could not be more than forty-two sixtieths in any case. 61. That is more than forty-sixtieths ? —Yes ; but I do not think it is worth while making any condition limiting it specifically to forty-sixtieths. You will find that the Boards will retire them if they are not fit for service. The Boards will have no compunction in doing so when they know that a man will get a fair pension. I think you will find that practically the retiring-age will be sixty-three ; so it will, I think, work out to a maximum of forty-sixtieths. 62. Supposing that the average salary is £200 a year and the man retires after forty years' service, what will his retiring-allowance be ? —And supposing he continues to contribute, you mean ? 63. He retires at sixty, and he went in at twenty ?—He cannot go in before twenty-one. 64. Well, say twenty-three and sixty-three ?—That is, forty years ? 65. Yes ; and his average salary is £200 ?—Well, he will get £133 6s. Bd. 66. Well, that is more than £120 ?—Yes. 67. A good many members are under the impression that the Bill limits the pension to £120 ?— That is for the average salary. Ido not think it should be limited to £120. 68. Are not the actuarial calculations made on a limit of forty-sixtieths ? —Yes, that is quite right; but they are made on the average salary. A good many salaries are below £180, and a good many above it. Mr. Fox points out to me that the figure 18 that is inserted here in the pages would make the pension work out to forty-five-sixtieths ; but, as a matter of fact, in practice that could not be so. 69. Is there any need to put in any maximum limit ?—I do not think so. Mr. Fox : I do not think so, either. 70. Mr. J. Allen (to Mr. Hogben).] Under the Bill it is proposed that original members should get a minimum £52 ?—Yes.