SUPERANNUATION.

Auckland Star, Volume LXIII, Issue 282, 28 November 1932, Page 9

SUPERANNUATION.

CASE FOR CIVIL SERVICE.

PLEA FOR STABILITY.

The New Zealand Civil Service Institute, when giving evidence before the Select Committee of the House of Representatives, said it trusted that no postponement of the Government Superannuation Funds Bill would be contemplated.

"It is essential," the statement proceeds, "that the general taxpayer (of whom the Government for the time being is the accredited representative) should realise that the present position is mainly due to the fact that contributing offioers have had in effect to meet the Government's dishonoured promissory notes. That these promissory notes were not dishonoured on account of inability to pay is evidenced by the fact that during the period since the inception of the funds the aggregate of Budget surpluses to March 31, 1930, exceeded £33,960,000, yet promissory notes to the amount of "£2,036,000 odd were dishonoured during the same period in the case of the Public Service and teachers' funds."

The institute emphatically protested against being called upon to share oiv a 50-50 basis with the State a deficiency which was entirely the Government's, and not in any particular the contributors' or annuitants'. The institute regarded that as a breach of faith and of contract which was being inflicted on officers in the service.

"If the proposals in the bill are given effect to in their entirety, then the institute strongly desires that the control and administration of the funds be placed independently and absolutely in the hands of commissioners (with the responsibilities of trustees) appointed from the service, of whom the Government Actuary should be one," the statement proceeds. The institute would draw attention to the compulsory retirement within the past year of 457 members of the railway service with 35 years' and under 40 years' service—thus prematurely increasing the burden on the Railways Superannuation Fund by £108,000 per annum, while at the same time losing contributions for an average period of five years to the amount of approximately £5500 per annum. Had the Railways Superannuation Board not relied on section 119 of the Government Railways Superannuation Act, 1926, and section 16 of the Government Railways Amendment Act, 19*27 (Government guarantee of fund), and had that board the powers and responsibilities of trustees to maintain the solvency of the • fund, it is hardly conceivable that such methods of relieving the working railways account would have been adopted. The maximum new pensions granted from this fund in any one year up to> March 31, 1930, was £36,409 in 1924-25, while during the two years 1930-31 and 1931-32 new pensions to the amount of £40,573 and £143,807 respectively were placed on the fund. "As a result of these recent retirements, it is doubtful if the financial provisions of the bill will be sufficient to place this fund in a sound position, even on the proposed new basis, which will also very seriously penalise the annuitants, thus created, by reducing their pensions to an extent never even dreamt of at the time of their forced retirement. Th 6 position of this fund would appear to require special consideration to ensure its solvency."

The institute endorsed the abolition of the £300 limit of retiring allowance.