The Press TUESDAY, JULY 13, 1954. Social Security

Press, Volume XC, Issue 27400, 13 July 1954, Page 10

The Press TUESDAY, JULY 13, 1954. Social Security

(Another warning about the heavy : strain borne by the social security ■ system in New Zealand was given : recently by Dr. L. H. Cordery, president of the Christchurch (division of the British Medical Association. A summary of views i Dr. Cordery expressed in the “ New “ Zealand Medical Journal ” was printed last Saturday. Saying that many New Zealanders are well aware that the health services under social security are too costly and cannot be supported “ for ever ”, Dr. Cordery points to “the crux of the “ matter ”, ■which, he contends, is that the scheme is “ too compre-

“ hensive and financially unsound ”. (The public and politicians cannot be i reminded of these facts too often, Jif only because frequently heard (authoritative voices may do somej thing to check a trend towards ■reckless expansion of social security i benefits. When the social security system is considered, most persons are prone to consider only medical benefits. But these, as Dr. Cordery points out, constitute only a small part of the outgoings from the fund; though they are big enough to warrant, of course, constant scrutiny and the most careful review. But the scheme as a whole must be constantly examined. When he presented the National Accounts for the 1953-54 financial year recently, the Prime Minister mentioned that the total social security payments for the whole year amounted to £62,000,000, almost £3l for every man, woman and child in New Zealand. Despite the depreciated value of the pound,- these are formidable figures; they represent income that does not come from investments or anything of the sort, but from taxation levied by wages tax on all earnings in New Zealand and by social charge on other income. And that is not sufficient. For the last few years it has been necessary to subsidise the Social Security Fund by some £ 14,000,000 from funds derived from general taxation. In these circumstances, it is difficult to see how the system could take, the heavier strain that would necessarily be applied in a time of economic stringency. Even the small amount of unemployment that is recognised as usual in a state of “ full employment ” —as distinct from one of “ overfull employment ” —would at qnce transfer enough funds from the “receipts” side to the “ expenditure ” side to unbalance the fund seriously. Greater unemployment would test the fund correspondingly; and when the need was greatest, the fund would be most likely to fail those relying on it. The high cost of monetary benefits and the rapidly growing cost of health benefits suggest that this will be a real possibility if conditions become less buoyant. There are firm grounds for political agreement about social security, because both political parties arc committed to giving the most liberal social security benefits that New Zealand can afford; their great mistake up to the present has been to compete to feed the appetite of the scheme in times of economic prosperity, regardless of what would happen if the national income were curtailed. Unhappily, in an election year the parties would almost certainly reject an examination of social security from the scheme of practical politics. But this year the parties can avoid such gross irresponsibilities as trying to obtain votes by straining a heavily strained system still further, and rendering it even more unfitted to cope with emergency than it now is. Agreement now between the parties to refrain from using social security benefits as electioneering bait might lead, after the election, to agreement to a competent inquiry into the whole system. It is in everybody’s interests that the structure of social security be solid and secure, and in the interests of nobody more than those who would need it in times of adversity.