DICTATING ON PRIVATE THRIFT

Evening Post, Volume CXXXVI, Issue 43, 19 August 1943, Page 4

DICTATING ON PRIVATE THRIFT

The refusal of the Government to sanction a local body' superannuation* scheme with a private insurance company is one more example of an everincreasing measure of State interference and control. The Nelson Harbour Board and its employees were in complete agreement on the scheme which the private company had submitted, but, when in accordance with .the provisions of the law, Ministerial approval was sought the Minister in Charge of the National Provident Fund (Mr. Nordmeyer) informed the board that he was not prepared to sanction an independent scheme at present and advised it to apply to the National Provident Fund for an adjustment of the contributions. This was done in spite of the fact that proposals which the State institution had submitted were considered to be beyond the reach of the board and the workers. The reasons which Mr. Nordmeyer has given for the Government's highhanded action are far from convincing and must be disturbing to local bodies which are anxious to do the best they can for their employees. "Legislative authority already exists for you to initiate a superannuation scheme, parallel to the Public Service scheme, or for your board to take advantage of the National Provident Act," said the Minister, "and it is considered that these channels adequately meet your reasonable requirements." Employers and employees, although in agreement as to the scheme best suited to their needs, are thus told, in effect, that they must either deal with the State or go without a scheme altogether. When the chairman of the board (Mr. Gould) described what had happened as being

against all business practice, he was putting the position very mildly.

This is not the only discouragement put on private thrift and self-reliance. When people contribute to superannuation schemes, either State, local body, or private, they do so with the idea of making provision for their old age. It is a form of .saving apart altogether from the compulsory contribution they must make to the Social Security Fund. But when they reach the retiring age they find that, because of the means test of the Social Security Act, they are debarred from ' receiving the full Security benefits for which they have, paid. Similarly, people who have no superannuation schemes but make provision for their future by some form of thrift —by insurance or other investment— are also barred from receiving full Social Security benefits. They are, in fact, in a worse position than members of superannuation schemes, for thai amounts they set aside are not subsidised, and every ls in the £ they pay into the Social Security Fund restricts their opportunity of making adequate provision for themselves. The operation of the means test, which, in the majority of cases, limits the income of married couples to £4 a week, really amounts to a levelling of incomes over the whole of the community. Contributors to superannuation schemes and those who make their own provision make extra payments, but in the result they receive no more than those who, either through lack of opportunity or desire, make no such provision. There is thus a complete lack of encouragement for thrift. Thrift, in fact, is penalised. Now, apparently, the Government, not content with limiting the amount of income to which people are entitled when they reach the retiring age, is dictating to those who still desire to contribute to superannuation schemes as to the form of scheme they -must adopt..