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COMPULSORY INSURANCE IN GERMANY., Issue 7906, 14 May 1889
COMPULSORY INSURANCE IN GERMANY.
It will be remembered that some time ago Sir Harry (then Major) Atkinson propounded a scheme of compulsory State insurance for this Colony. No practical result followed his advocacy, owing principally to the interested opposition of the friendly societies, aided by the frightened cry of “Socialism ahead !” The question, however, is tolerably certain to be mooted on some subsequent occasion, and meanwhile some account of the important steps which have been taken in Germany in the same direction may not be without interest and instruction. Bismarckism and Socialism do not readily strike the mind as synonymous terms, but it is none the less a fact that to the German Chancellor belongs the authorship of perhaps the most distinctly socialistic (we use the word in its best sense) enactments at present in existence. Referring to the German insurance laws, Sir Edward Malet, British Ambassador at Berlin, terms them “ part of a social experiment on “a vast scale, which, if it succeeds, will “ form the most enduring title of the “ late Emperor William and Prince “Bismarck to the gratitude of their “countrymen.” The Foreign Office has published a report, by Mr Rennell Rodd, a member of the British Embassy at Berlin, dealing with the rise and progress of the movement in question; and from an abstract of this report we gain our information. What has already been done in Germany is only an instalment of the complete plan in contemplation. The object of the movement—which originated in 1881— was to establish a system of compulsory insurance for workmen against sickness, accidents, and old age. In the legislative proposals these three contingencies have been kept separate; indeed, as yet no provision has been made for insurance against old age. In 1883 the first step was taken by the enactment of a law compelling the insurance of the workmen against sickness. In this department the duty of insuring rests naturally with the workman himself, and his obligations and privileges are apparently very similar to those which exist in connection with voluntary societies. It is noteworthy, however, that if an illness lasts longer than thirteen weeks the case then comes under the operation of the second enactment — that passed in 1884, providing for insurance against accidents. In this branch the obligation of insuring lies upon the employer of labor, the provision being an organised treatment of that general principle of the liability of the employer which has its recognition now in British law. The law of 1884 only made insurance compulsory on employers in trades where accidents were frequent and likely; but in 1885 the provision was largely extended, and also made to include all workmen in the various Government departments, ■while in 1887 it was made to cover people engaged in marine occupations. The question of insurance against old age is to be dealt with hereafter. It is to be observed that agricultural laborers are not included in the compulsory operation of the scheme, “ unless they are “brought within its scope either by “ the local option of a community or “by means of internal legislation on “ the part of any one of the States com- “ posing the Empire.” The Government of Saxony has accordingly passed legislation bringing agricultural laborers under the scheme. It seems to be considered likely that the operation of these compulsory insurance laws will eventually be extended to “ all persons in the employment of others.” Such are the general principles of the German legislation in regard to insurance; but something must be said concerning the methods by which the scheme is worked. The management of the sickness department, in which the workman is his own insurer, is naturally sufficiently simple; but that of the accident branch, where the employer has to insure, rests upon a complicated system, the principle of which is to mitigate the compulsory force by joining a plan of selfgovernment with the general State control. The method is too elaborate for complete explanation, but the principle in this; an employer does not insure individually, but in conjunction with all his fellow-employers, who are grouped into associations according to convenient distinctions. Under the supervision of the Imperial Insurance Department these associations make their own statutes and control their own finances. Arbitration Courts exist in connection with each association, the president being a Government official, with representatives of employer and employed as assessors. The Imperial Department is, however, a final Court of appeal in all cases of dispute, though it is observable that even in this institution there are elected representatives both of the employers and workmen. Each employer contributes to the common fund according to the number of his workmen and the increase of peril attaching to hia work ; and from this common fund the indemnities to workmen are paid. These indemnities consist of assistance to self-insured workmen whose illness has extended beyond the limit of their changeability to the sick insurance fund, of allowances during disablement through accident, and grants to families in ease of death. The advantages of this associative system would seem, to be twofold. First, in cases of special disaster, no one employer is heavily mulcted; secondly, the position o£
the associations enables them to do a great deal towards the prevention of accidents. Considerable power is •nven them of enforcing regulations with this object; and “ the framing of “the resolutions, and the duty of “enforcing them, lie with the very “ people whose interest it is to pre- “ vent the occurrence of accidents.” Mr Rood’s report contains a summary of the first annual report issued by the Imperial Insurance Bureau, from which a few statistics may be given as showing the magnitude of the undertaking. During the year (1886) there were 62 associations with 366 sections, 39 salaried inspectors, 404 arbitration courts, 269,1/4 businesses, and 3,473,435 workmen insured# the total wage represented being computed at £1,114,169,432. The number of accidents was 100,159 ; of deaths by accident, 2,716. The amount paid by way of indemnity for accidents was £85,000, while the cost of administration amounted to no less than £116,200. This latter item, however, is likely to decrease year by year; and it is stated that, if the concern were entirely in Government hands, the cost would be greater. The total receipts in all branches amounted to £619,000, and the expenditure to £515,000, this latter sum including £270,000 for the establishment of a reserve fund. Judging from the tone of the report, the results of the “Socialistic” experiment are considered to be highly satisfactory. In giving an account of this bold scheme of German statesmanship we do not wish to be understood as presenting it as a necessary model for New Zealand legislators. If, indeed, the principle of compulsory insurance be at any time adopted in this Colony, a much simpler project will suffice, and it may bo that even for the adoption of the principle public opinion is not yet ripe. Still, we think there can be no doubt that present tendencies of political and social thought lie in this direction. The bugbear of “Socialism need not frighten us. True, Socialism has suffered much from the false adherence of unsocial istic anarchists ; but, rightly conceived, it is the sworn foe of anarchy, and is strictly compatible with “man’s true freedom, which can only lie in servitude to law. Prince Bismarck’s action is in itself a remarkable testimony to this fact. It is often said, with justice, that half of the legislation of the present day is a recognition of Socialism. Britons, as a rule, have a more or less vague prejudice against such legislation; but this is principally on account of its restraining, not its unsettling, influence. Paradox as it may seem, a false Liberalism, rather than a true Conservatism, is at the bottom of much opposition to radical proposals. Anyhow, it is well that we should acquaint ourselves with “ the heroic methods “by which the German Chancellor “ seeks to solve that great question of “labor which is presenting itself to “ Englishmen with so much imperious- “ ness.” Since the above was written the cablegrams have informed us that Prince Bismarck has introduced into the Federal Parliament a measure extending the principle of compulsory insurance to aged and indigent workmen, and that the Bill has passed the Representative Chamber.
COMPULSORY INSURANCE IN GERMANY., Issue 7906, 14 May 1889
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