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COMPULSORY INSURANCE.

The letters signed " Dissatisfied " and "A Working Man," which recently appeared in our columns, are so far satisfactory that they indicate the existence of an intelligent interest in the question of life insurance on the part of those who are chiefly concerned. This is exactly what is desired, for there can lie no doubt that beneficial results will How from its free discussion. Both our correspondents, however, busy themselves with mere matters of detail—important in themselves, but in no way aft'ecting the principle involved ; which is, that those who are in the employ of the State shall make provision for old age and infirmity, so as not to be a burden on the community when they are past work. The imperative "shall," of course, implies compulsion; but if, as "A Working Man" asserts, the title of compulsory " rises in the gorge of freemen," the offending word can be struck out without injury to the principle of the Bill. The same correspondent insists upon the benefits derived from benefit societies in the shape of sick pay, and from insurance societies to families after the death of the breadwinner. But the main object of the measure under consideration is to provide employes with the means of subsistence during life. It surely is worth a little sacrifice, made in the days of health and vigor, to assure against want and privation when the sight is dim and the hands are feeble. For the information of this correspondent and the Service generally, it may be stated that " all persons" at present employed on the Government railways, and who have been so employed for not less than three years previously to the coming into operation of the proposed Bill, are to be recognised as "permanent employes," and the whole time of their service is to count.

"Dissatisfied" adopts another line of argument. His main objection is to the amount of the payments proposed to be levied. This is fairly matter for consideration; and it is to be presumed that there has been—or, if not, that there will be—an actuarial inquiry into this branch of the subject, and if these payments are found to be excessive in comparison with the prospective advantages, they will of course be reduced. But some of the calculations made in this letter are clearly wrong. In the case of a man earning 7s a day, if payment is made at the rate of 2s a week he will have contributed £lO4 in twenty years, and £156 in thirty years, which, even with interest at the rate of 5 per cent, calculated weekly, would not amount to £3OO. Further, the proposed retiring allowance is calculated upon the pay the employe may be receiving at the date of his retirement. So that, if by steadiness he had earned promotion and was in receipt of 12s a day at that date, his retiring allowance would be at the rate of 4s a day, or, say, £62 per annum. The same remark applies to other grades of the Service. On one point we incline to agree with our correspondent. In the case of death the entire balance of an employe's savings, with fair interest added, should be paid over to his surviving relatives. It is also reasonable that if an employe leaves the Service he should be entitled to receive the full sum of his accumulated savings, seeing that the State is no longer chargeable with his future maintenance. But these are all matters of detail; and, if the principle contended for is affirmed it will be an easy matter so to adapt these as to ensure their fitness and accuracy.

The German system, to which some allusion was made in a former article, goes very much farther than the proposals of the Railway Commissioners. As the lessons of experience are most valuable, a brief resume of that system will be appropriate to the subject. In the first place, its application is general, and embraces all classes of workmen, whether employes of the State or otherwise. The payments levied, and for which the employers are rendered liable, are at the rate of a fraction less than 8d per 20s of wages. Of this amount 5d is funded as an insurance against sickness and death, and the balance as an insurance against old age and infirmity. In case of sickness he is entitled to thirteen weeks' free medical attendance, including the supply of medicines, and also to accouchement fees if he is married, together with a money allowance equal to one-half his average wages. In case of death, equal to thirty days' wages of an ordinary laborer is paid to the survivors. In case of accident the injured workman receives the sick benefit and compensation for partial or total disablement. This, for a workman earning 20s a week, amounts to a pension of 58s per month if he is totally disabled; and if he is killed, £4 is allowed for burial expenses, and his widow—with, say, two children—receives forty-three shillings per month, till the children are fifteen years old. When old age and infirmity come on he can claim a pension ranging from £6 to £l2 10s a year, according to the length of time he has been employed. " Thus," says a writer on the subject, "the German workman, by " the deduction from his income of less "than eightpence in the pound, is "secured against any illness which " can prevent him from following "any employment he can get. "Sickness, death, disablement, and "infirmity are all provided for." The sick insurance fund is, on the whole, self-supporting; but in the case of any deficiency provision is

made foV its being supplied by the employers or the commune, and the accident fund is maintained wholly by the employers. The old age fund is supported by the workmen, the employers, and the State in equal proportions—that is, each pays a third. These provisions are far and away beyond the scheme contemplated by tho Railway Commissioners. With the waking of provision for sickness or disability from any cause it is not proposed to interfere. This is a matter which is best left to the friendly societies organised for that purpose; but it would not be out of place for the State to insist on its employes making such provision for themselves. The main point at issue is, that the thriftless shall not "loaf" on the thrifty; and this concerns the whole community. The stated objects of the Commissioners' scheme are to provide for retiring allowances, and for the payment at death of a sum of money to the deceased employe's representatives. Tt is limited to one branch of the Public Service; but, if it is good for one branch, it is good for and should extend to all. That it may not be entirely acceptable in its present crude state is possible : but it is now before the public, and discussion cannot but be beneficial. It would be well indeed if, in the case of all intended legislation, the measures to be submitted to Parliament in any session were submitted to the public during the preceding recess. In the present instance a measure of great moment, not only to the railway employes but to all others, has obtained the very great advantage of publicity before the State has been committed to its adoption, and nothing but good can result from this course having been pursued.

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https://paperspast.natlib.govt.nz/newspapers/ESD18890925.2.2

Bibliographic details

COMPULSORY INSURANCE., Issue 8021, 25 September 1889

Word Count
1,237

COMPULSORY INSURANCE. Issue 8021, 25 September 1889

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