SUPERANNUATION

Evening Post, Volume CXV, Issue 38, 15 February 1933, Page 3

SUPERANNUATION

GOVERNMENT BILL

COLONEL MCDONALD'S

EVIDENCE

Evidence was given to the Government Superannuation Funds Bill Committee today by Colonel T. W. McDonald. "Tho chief object of the Bill appears to be to compel annuitants and contributors to pay the shortages in the funds caused b,y default on the part of the State over a period of years, when it had overtaxed the people by millions of pounds, squandered millions of pounds on unnecessary undertakings, and instead of conserving the contributors' contributions to meet their retiring allowances the State has used them to meet current retiring allowances instead of meeting those allowances out of State subsidies for back service in accordance with its contract with those who joined the funds," he said. Colonel McDonald said he was chiefly concerned with that class of superanmiitant that came under the provisions of section 52 of the Finance Act, 1920, and section 28 of the Finance Act, 1921. Tho former Act provided that the Defence Minister could retire contributors whoso commissions dated prior to November 1, 1920, and whose age was not less than 55 years. That amendment was made to enable those officers who, by an amendment of the Defence Regulations made after they joined the fund, had their retiring ages reduced to 55 years of age to qualify for superannuation. There were about 67 such officers and the Government, presumably after referring the matter to the actuary to fix the sum required to prevent any extra burden bring placed on the fund by thoso compulsory early retirements, agreed with the Superannuation Board to pay £20,000 into the fund. If all the 07 officers had retired under the provision at one-sixtieth of their average salaries for the Jast threo years for each year's service (and that was the basis on which the £20,000 was granted) their early retirements would not entail any extra burden on the funds because that extra burden had been specially provided for. But of those 67 officers, some thirty retired of their own volition in preference to waiting to retire under the other provisions. They received a return of the contributions and compensation for the loss of office. For the purpose, the State made a further grant of some £7000 to be paid in lieu of superannuation, so that tho special grant of £20,000 had to meet the deficiencies through early retirement of only 37 officers. The fund had been assisted in those cases instead of being injured as the Bill implied. The Finance Act, 1921, placed a limit of £300 per annum on the amount the officers could draw, and that resulted in heavy loss to some who, instead of receiving their agreed upon allowances, received only £300, although the £20,000 grant provided for onesixtieth of the last three years' average salary for each year's service. Colonel McDonald contended that there was no legal or moral reason for including those officers in the provisions of the BiU, unless their retiring allowances were to be paid for twice. The Committee, adjourned till tomorrow.