NATIONAL ANNUITIES.

Evening Post, Volume LXXII, Issue 71, 21 September 1906, Page 5

NATIONAL ANNUITIES.

■ .I ♦ THE GOVERNMENT'S PROPOSALS.. BILL INTRODUCED IN PARLIAMENT. WHAT THE MEASURE CONTAINS. LIBERAL PROVISIONS FOR OLD AGE. LARGE FAMILIES SUBSIDISED. Tho National Annuities Bill introduced by the Premier in the Houso of Representatives yesterday is a measure of 24 clauses. Tho preliminary sections of the Bill provide that the national annuities scheme is to form a branch of the Government Insurance Department, and tha commissioner is empowered to enter into any contract for tho granting of deferred life annuities and annuity assuf ances, and in tho words of the Bill it* self, "for insurance on a life or lives, and for the salo of annuities for life or otherwise, and for the granting of endowments and of superannuation allowances or pensions, and any contract' whatever dependent on the contingencies of human life not' repugnant to public property." Clause 4 provides that on 31st December, 1906, there shall be transfcrerd to the national annuities branch of the business of the department (a) all contracts then existing on the books of tho department of tho following classes :—(1): — (1) Immediate annuities, (2) deferred annuities, and (3> endowments and investments, and (bj tho full reserve "attaching to such contracts on that date. j SUBSIDIES BY THE STATE. The Bill provides that the Colonial Treasurer shall pay annually from the Consolidated Fund into the national annuities account the estimated amount | of subsidies according to the second | schedule of tho Bill. In order that tho proposals of the Government may bp intelligibly followed, it is well to set out here what the precise uabure ot these subsidies is. In the first placo ix> is provided that tho minimum, an- | nuity to be granted is £13 per annum, 1. If the subsidised deposits at the deferred! age do not amount to a sum sufficient to purchase an annuity of £13, the subsidised accumulations will be returned with compound interest at a rate of interest not higher than 3J per cent, and not lower than 2£ per cent, per annum. 2. The subsidy will be based upon tho premium payable. £166 per annum is tho maximum annuity for which the premiums will be subsidised, so that when the subsidised annuity roaches the maximum of £156 per annum any premiums paid to purchase additional amounts of annuity will not be subsidised. 3. The full subsidy will be given if the ago at timo of starting deposits is not less than 15 years of the deferred age; otherwise tha minimum .subsidy ,of 10 per cent, only will be given.. HOW FRIENDLY SOCIETIES ARE AFFECTED In' like manner subsidies arc to bo payable to any society or branch regktored under the Friendly Societies Act of 1882 in respect of the weekly aU lowances made by it during the preceding year (ended 31st December) to members who have attained the ago of 65 years on account of sickness ' or other : infirmity. In tho case of weekly -allowances made by such societies for sickness or other infirmity to membern under the age of sixty-five (where tho ! incapacitated tnember receives ' allow [ ances for 12 months or .upwards) subsidies shall bo paid on the following basis: — - '* (1) Where the incapacitated member'ft ago is between fifty-five and sixty-fiv« years a subsidy equal to 60 per cent of tho total allowances paid during the preceding year ended 31st December ; (Z) Between forty-five \ and fifty-five years a subsidy equal to 60 per cent, of the allowances ; (3) Between thirty-five and forty-fiv« years, 70' per cent, of the allpwanccs s (4) Bctwen twenty-five and thirty-fiva years, SO per cent of the allowances, and ■ • (5) Where his age is under 25 years, a subsidy of 90 per cont. of tho allowance. SCHEDULE OF PAYMENTS. The annuities will be payable b" lour equal quarterly instalments', the first of which will become due three months after tho deferred a ce. In tnc event of death at any timo\ bofme tha deferred age, all deposits (with cubsidies) will bo returned with compound interest at tho rete or 3 per cent, per annum. If death occurs during the first five years after deferred age, the £ S i f o^"' 0 years annui V will bo paid to the representatives of tho If death occurs after the first five. jears, a proportionate payment of In tho event of a policy taken Tablo" T a r C °°, ld - ance with labile I O r it l l 1 be , IDg surandercd •««* llT*'? ye f rs in force, IS tier cent, of the deposits will ha returned ; after three years 75 J£ ■saaygssas \ FEW EXAMPLES OF WORKING I V Vtt't the »fc»»eerf to W« age of seventy, an annuity* of 18 S " d or a cm* payment of £8 15s 3d ij lh* deposit naS made when too annuitant of seventy year*, an annuity of 10s lid ot a cash payment of £o 4s"7d. As the uge at which the deposit is made increases the annuity dwindfea in sympathy with th« illustrations given. Tho position will be more cleaily un* derstood from the tables below? A person who deposited a single £1 with the depiartmont, and never mate any further payments, would be entitled t6 amounts according "to th« foj. lowiug scale if he contracted td dra\» When he was- 60 xears or' 7o je*w ql£

laving regard- for his age when the deposit was made: — " Deferred, Ago GO. Dof erred, A ire 70. ' - Annuity Cash, Aunuity Cash from" for] a t from [or] at DeBOSJt. Ago 60. Age CO. Ago 70. Age 70.

Table IT. "provides for a minimum scale 6f deferred 'annuities for yearly premiums of £1. A' person of the age of live years who . entered .on a contract under the scheme to pay £1 per annum on a deferred -age of evxty years would get* an annuity of £11 14s 9d, or a cash payment •of £165 19s 7d. ' A similar contract on 1 deferred age of s>ixty-five years would produce an annuity of '£16 13s 9d or a cash payment of £190 9s ; and on a deferred age of seventy years, an annuity of £24 3s 3d, ox- £231 '& lid cash. H tho annuitant entered into the contract on the -sume basis wheri-he was twenty years old on a deferred age of sisty bo would get ftn annuity of £6 3s 4d, or a cash payment of £81 18s 10d;'on a deferred age of Bixty-five an annuity of £8 19s Bd, or £102 10s 4d.; on a deferred age of seven- j ty, an annuity of £13 5s Id, or £126 19s Id, and so on' downwards. This "principle of payments may be Explained, in tho same way as table 1. If a person goes into the ' scheme, and consistently pays a single £1 every year, he would be entitled to amounts according to the following scale if he contractBd to participate in .the annuities he was entitled to at 60 or 70 years of fcge, having regard for his age when the first deposit was made:— Deferred, Age GO. DaTei red, A ire 70. .Annuity Cask Aunuity Cosli from [or] at fioni for] nfc t)ep. AseCO. -i.Asre6O. Age 70. Aeo7o.

"Table HI. gives the 'premiums for annuity assurances with assurance payable at death before deferred age cf £100, apd a minimum annuity payable after deferred nge of £13 per annum. It 13 unnecessary to give the scale of premiums, howover, as they are based on the ordinary rates fixed by life insurance* companies doing business in the colony. > - CONTINGENT GRANTS. The' Bill, which is entirely based on the scheme propounded by the late Mr. Seddon, makes provisions for liber.il grants on the keep-the-cradle-full idea. For instance, an unmarried man gets a subsidy of 10 per cent, on his deposit, a married man l 2£ per cenl.', if tie lias one child living 15 per cent, if his family consists of two • children 17£ per cent., three children 20 per cent., four 22£ per cent., five 25 per cent., seven to nine 30 per cent., ten to twelve 32£ par cent., and the proud father of over twelve will get 35 per cent, 'lhe scheme is also designed to help tho poor man. rather tha,n, the. rich, . It. is provided, for instance, that an annuitant whoso earnings are under £156 per annum will get an.extr.a,.^uhsidy,of^,per cent,, over £156 and under_±<26o air extra subsidy of 2£ per cent., a widToweVor a widow will .get an extra .suljFidy" of the same, amount, 0. nrember'of - a -friendly- society -an extra Bnbsidyof 5 ye: cent., and tlje annuitant who excels iv "persistency in depositing" 2^ per cent. FOREGOING PROViSIOXSEXEMPLI- ' " FIED.' •"Persistency in depositing," the Bill explains^, meansl the .continuance for .three years of deposits averaging not less than -£B 12s per annum, during each of the three years- - An unmarried annuitant, -under the scheme, whp^ia..earning £5 per week or more, and wno is not a member of a friendly, society . and not '.'persistent," would* be entitled to a subsidy o£ only 10 per gent., but an unmarried man who is earning under £3 per week, is a friendly-eociety member,. -and. .a. "persistent" would <;et a subsidy of 22£ per cent. .-•A married man or woman earning- £5 per week or more, who is noi a member of a friendly society and not a "persistent," "would be entitled' t<ra subsidy of 12£ per cent. In the same way a married man, ■with three children, earning 10s" per day, ■will get "a subsidy" of 22£-per cent. ; and if a member of friendly society, persistent in depositing, the subsidy will be.3o "p^r cent. 'A married man, with over twelve children, earning under £3 a •week, a friendly society member, and '"persistent," subsidy 47^ pir cent. A .yjdow or widower, with twelve children, earning under £3 a week, a friendly 80member, and "persistent," subsidy 6tf per cent. '

kge. S s. (1. £ B. d. « Ul4 9 155 19 7 10 9 11 1 126 19 1 15 714 4 102 10 4 20 6 3 4 81 18 10 25 417 3 64 12 4 30 315 4 50 0 7 35 216 10 37 15 0 40 2 1 3 27 8 1 <5 1 8 2 18 14 0 50 17 1 11 7 5 66 7 10 5 3 11 £ 6. (I. £ s. d. 24 3 3 231 7 11 19 17 9 190 9 0 16 5 9 155 19 7 13 0 1 126 19 1 10 14 1 102 10 4 8 11 1 81 18 10 6 14 11 64 12 4 5 4 6 50 0 7 3 18 10 37 15 0 2 17 3 27 8 1 ,1 19 1 18 14 0

Age. 10 15 20 ■ 25 30 . 35 . 40 '45 SO 55 s. (I.c. £ c. (1. 946 4 3 7 10 5 4 7 6S• 4 8 1 5 7 3 14 2 483 2 5 3 11 2 12 7 342 4 3 2'lO 1 17 3 2 4 1 11 4 2 0 16 5 18 12 3 s.d. 18 4 15 5 13 0 10 11 9 2 7 9 6 6 5 6 4 7 3 11 3 3 £ s. £15 7 7 6 4, 5 4' 4 8 3 14 3 2 2 12 2 4 1 17 1 11