SUPERANNUATION

Evening Post, Volume CVII, Issue 129, 5 June 1929, Page 13

SUPERANNUATION

SHORTAGE IN FUNDS

OVERHAUL TO BE MADE

(By Telegraph.)

(Special to "Tho Evening Post.")

AUCKLAND, This Day. In his speech at the Town Hall last night the- Prime Minister announced the Government's intention to cause an overhaul to be made of the various State superannuation, funds.

"A matter which is engaging my attention is the position of the State superannuation funds, which I regret to say are not in a satisfactory financial position," said Sir Joseph Ward. "In recent years several factors have combined to greatly increase the burden on these funds. For instance, the altered price levels and the resulting salary increases arising out of the war have led to larger retiring allowances, while the accumulated funds,, of course, have not increased proportionately. The State subsidies to these funds should have been increased for this reason. Betirements at a much earlier age, particularly in the railway and post and telegraph branches of the service, than was originally contemplated are also adding considerably to the burdon on the funds. I may say that I am going to have the whole position of the. superannuation funds thoroughly investigated in order that the Government may bo in a position to consider what steps must be taken to place them on a sound footing for the future. The Government subsidies paid since the war have been considerably less than what the actuary has certified as necessary to make up the ampunts required to meet the pensions at present paid by tho fund. That.means that part of the pensions of .those .who have retired is being drawn from the accumulated contributions of the current contributors, and this is: quite unsound. The accumulated shortages against current pensions in the case of two of the funds are as follow:—

;"Publio Service superannuation fund £1,060,000. .. . .',-...

''Teachers' superannuation fund. £607,000. . ... . .

'In addition there is also a considerable, shortage in the case of the railway superannuation fund, although the actual figure is not available at the moment. It is certain, however, that the shortage for the three funds amounts to a very large sum, and steps will have to be takon to deal with these arrears which must be provided for by the State, irrespective of what is done to place the funds on a sound basis for the future."